Property Law

Editor:
Paul F. Sherman, Esquire

Board of Adjustment’s decision is affirmed, reversing trial court, on grounds that include petitioners’ requesting non-use variance failed to satisfy their burden of showing practical difficulties existed to warrant the variance. Brown v. City of Maplewood, Missouri, No. 96548 (Mo. App. E.D., December 20, 2011), Clayton, J.

The Browns wanted to add a carport to their garage in Maplewood, an extension to the west of 20 feet. However, with the extension they would then be within 11.5 feet of their property line in violation of a 15 foot setback requirement. The Browns non-use variance (would authorize deviation from the setback restriction) was denied by the City’s Design Board and by the City’s Board of Adjustment (“B of A”). The Browns desired more parking, but the City’s B of A’s findings were that same was an adverse effect on neighbors and the public. The trial court then reversed the B of A’s denial and this appeal followed.

Was the B of A’s decision supported by competent and substantial evidence, or was same arbitrary and capricious?

Held: Trial court reversed, Board of Adjustment's decision of denial affirmed.
Reviewing the record, the Browns’ home (built over 100 years ago) was itself a legal, non-conforming use even though the east side was already at the property line. If extended to the west, as proposed, the Browns would lose their legal, non-conforming use status and then be in violation on the east side. Thus, the Browns’ “practical difficulties” showing required for a non-use variance were deficient and the B of A’s decision was not an abuse of its discretion. A two-car garage filled with “forty-five years of stuff” was insufficient justification for the request. Personal difficulty is not a unique or peculiar property condition.


Editor:
David F. Neiers, Esquire
Robert N. Faulkner, Esquire

Ambiguous item on Schedule B of a title commitment was found to be a requirement, the failure of which to be satisfied prior to closing was a breach of seller’s obligation to provide marketable title. JAS Apartments, Inc., v. Naji, et al., No. 91523 (Mo. banc, November 15, 2011), Fischer, J.

JAS Apartments, Inc. (“JAS”) signed a contract with Mohamad Ali Naji (“Naji”) to purchase property owned in Naji’s individual capacity. Naji was married at the time the contract was executed. The contract required Naji to obtain a title commitment for JAS insuring marketable title to the property. Naji obtained a title commitment that contained the exceptions to title and the requirements on a single Schedule B with no distinction between those items that were intended to be requirements and those intended to be exceptions. One of the items on Schedule B stated “the spouse, if any, of Mohamad Ali Naji must join in the proposed agreement.” Naji’s wife did not want Naji to sell the property so she refused to sign anything. Prior to closing, Naji informed JAS that he would not be able to obtain his wife’s consent to the transaction. JAS, interpreting the item as a requirement, sued to enforce the terms of the contract requiring Naji’s wife’s consent or extinguishing her rights allowing Naji to transfer marketable title. Naji argued that the item was an exception to which JAS agreed to take title due to its failure to object during its contractually permitted objection period. After a couple of appeals, the Supreme Court held that based on the evidence of record, it was intended by the title company that the item was to be a requirement, the completion of which being a condition to it issuing a title policy for marketable title. Since the item was a requirement, Naji breached the contract by not closing.

Held:
Remanded. The Court remanded for the circuit court to determine the appropriate remedy for the breach of contract by Naji.


Right of first refusal that does not provide that it runs with the land and binds the successors is a personal right and expires upon the death of the parties thereto. Anderson, et al. v. Parker, et al., No. 72431 (Mo. App. W.D., November 1, 2011), Howard, J.

James and Rose Mary Anderson (the “Andersons”) purchased property from John, James and Camden Riley (the “Rileys”) and also obtained a right of first refusal covering additional property owned by the Rileys. The right of first refusal was signed by the Rileys and merely stated that the Andersons had the first option to purchase a portion of the property at a cost deemed fair by a competent appraiser. Regardless of the use of the word “option”, the court found that the rights provided to the Andersons were preemptive rights in the form of a right of first refusal. After the last of the Rileys died, Mrs. Parker (the trustee of the survivor Riley brother’s trust) sold the property to a developer knowing of the Andersons’ right of first refusal. After the sale, the Andersons sued Mrs. Parker for breach of contract and fraud. The jury entered judgment in favor of the Andersons, but the trial court granted the defendant’s motion for judgment notwithstanding the verdict. This court, in affirming the trial court’s order, upheld the precedent in Missouri law that a preemptive right that does not specifically provide that it is binding on the heirs and assigns of the parties and does not indicate an intent that it survive beyond the lifetime of the parties is personal to the parties and expires at death.

Held: Affirmed.


Previously provided voluntary partial deeds of release from lender under deed of trust did not modify the terms of the deed of trust and create an obligation of the lender to provide partial deed of release to other purchasers of property subject to the deed of trust. Therefore, property owner did not have a vested right to the partial deed of release and could not force the issuance of same. Melson, et al., v. Traxler, et al., No. 72795, (Mo. App. W.D., November 1, 2011), Martin, J.

Carl and Martha Traxler (the “Traxlers”) conveyed 94 acres to Keith and Chastity Samuel (the “Samuels”) taking back seller financing secured by a deed of trust against the 94 acres. The Samuels obtained construction financing from Boone County National Bank (“Boone Bank”) over a portion of the 94 acres to subdivide the land into residential lots. The Traxlers agreed to subordinate their deed of trust to that of Boone Bank over the portion of the 94 acres that secured the Boone Bank loan.

Darrel and Mellony Melson (the “Melsons”) purchased one of the subdivided lots from the Samuels and obtained financing for the lot from First National Bank and Trust Company (“First National Bank”) which secured its loan with a deed of trust on the lot. At the closing of the lot to the Melsons at the office of Boone Central Title Company (“Boone Title”), the Boone Bank deed of trust was partially released with respect to the Melsons’ lot, but not the Traxlers’ deed of trust.

Several years later, Boone Title realized that it never obtained a partial release of the Traxlers’ deed of trust on the Melsons’ lot. Boone Title requested the partial release, but since the Samuels stop making payments, the Traxlers refused. The Melsons and First National Bank filed suit against the Traxlers to prevent foreclosure of the Traxlers’ deed of trust.

The Melsons and First National Bank filed a motion for summary judgment arguing that they had a vested right to the release of the Traxlers’ deed of trust as of the time the Melsons’ acquired their property because the Traxlers, First National Bank and the Samuels had a development plan through their course of performance wherein both the Traxlers and First National Bank would release their respective deeds of trust as the Samuels conveyed property and thus had a vested right to the release of the Traxlers’ deed of trust. The trial court granted the summary judgment and this appeal followed.

This court reversed stating that the uncontroverted facts did not establish a vested right in a partial release therefore entry of summary judgment was in error. The Melsons acquired the property with notice of the Traxlers’ deed of trust which did not contain an obligation on the Traxlers to execute partial deeds of releases at any time. The Melsons and First National Bank argued that the Traxlers’ execution of 14 previous partial deeds of release imposed an obligation to continue to provide partial deeds of releases on all other lots sold that were subject to the Traxlers’ deed of trust. The Melsons and First National Bank do not rely on any language in the Traxlers’ deed of trust but they argue that the deed of trust was modified by a course of conduct from the previous 14 partial deeds of releases. This alleged course of conduct is what the Melsons and First National Bank argue created a vested right to a partial deed of release on the Melsons’ property. The court relied on Missouri precedent to the effect that acontract is to be construed as written even if subsequent to its execution the parties act in a manner tending to show an interpretation at variance with the plain terms written in the contract. The court held that the Traxlers’ deed of trust was not modified by their subsequent course of performance of providing partial deeds of releases and because the Traxlers’ deed of trust did not contain a written obligation to provide partial deeds of releases, the Melsons and First National Bank did not have a vested right to obtain a partial deed of release from the Traxlers.

Held
: Reversed and remanded. The uncontroverted facts did not establish a vested right in a partial release, therefore entry of summary judgment was in error.