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Barkho v. Ready

Court of Appeals of Missouri, Western District, First Division

March 28, 2017

DANIEL BARKHO, Respondent,
v.
BETH READY, Respondent, DOUGLAS READY, Appellant.

         Appeal from the Circuit Court of Callaway County, Missouri The Honorable Gary M. Oxenhandler, Judge

          Before James Edward Welsh, P.J., Anthony Rex Gabbert, and Edard R. Ardini, Jr., JJ.

          James Edward Welsh, Presiding Judge.

         Douglas Ready appeals the circuit court's judgment ordering specific performance of an oral contract for the purchase of land and ordering him to pay attorneys' fees on behalf of Daniel Barkho and Beth Ready.[1] Douglas contends that the circuit court erred (1) in finding that the parties had an oral contract for the sale of property that was not barred by the statute of frauds because the evidence was insufficient to prove "by clear and convincing evidence beyond a reasonable doubt" that the parties entered an oral contract for the purchase of the land and (2) in ordering specific performance of the alleged oral contract rather than restitution. In regard to attorneys' fees, Douglas asserts that the circuit court erred in awarding Daniel and Beth attorneys' fees under the "special circumstances" or "very unusual circumstances" exception to the American Rule or abused its discretion in ordering him to pay Daniel's and Beth's attorneys' fees as a sanction under the court's inherent powers. We affirm.

         In 1981, the father of Daniel and Beth purchased a farm in Callaway County, Missouri. Their father, desiring to divide up the farm property between Daniel, Beth, and his four other children, [2] drew up a plan outlining the parcels of land that each child would receive. When their father died in 2009, their mother, Alene Barkho, became the owner of the property. Because of financial difficulties in making the payments on the property, Alene, in 2011, approached all of her children about their interest in purchasing the parcels of land that their father desired each child to have. At that time, Daniel could not obtain financing to purchase his designated parcel, Tract V.

         On May 29, 2011, Beth and her husband, Douglas, purchased property from Alene that included Tract V. Pursuant to the terms of the contract, Beth and Douglas agreed that if they desired to sell the property within 5 years of the date they purchased it, they would notify all of Beth's siblings. The contract stated:

Any of the said siblings of the Buyer who offer to purchase the property shall be entitled to purchase said property for a price equal to the cost paid by Buyer under this contract, together with the actual costs of any improvements placed upon the property by the Buyer from the date of the acquisition of title by the Buyer.

         The contract also provided: "With regard to Tract V, if Buyer offers same for sale, then Seller's child, Daniel M. Barkho shall have the right to refuse to purchase the property over any and all other siblings. Should he reject the right to purchase, then that right passes to the remaining siblings, equally." According to Daniel, he informed his siblings by word of mouth that it was his intent to purchase Tract V.

         Thereafter, in 2011, according to Beth, Douglas encouraged Daniel to go to bank in Callaway County to obtain a loan. Beth and Daniel went to the bank, but the bank denied the loan. In 2012, Daniel sought advice[3] from Douglas about a lending company based in Oklahoma. According to Daniel, he and Douglas had a discussion about the land and about it being transferred to Daniel. Daniel said that Douglas did not give him a figure in writing about the price of the land, but they discussed it verbally. In July 2012, Douglas computed figures for Tract V with the improvements on the land so that Daniel could inquire about a loan for the land.

         In January 2013, Daniel spoke to his boss about possibly borrowing money from him to purchase the land. When Daniel's boss agreed to loan him $45, 000, Daniel contacted Douglas and Beth and inquired about the purchase price of Tract V. Daniel said it was his understanding that he would pay $400 per acre plus the cost of any improvements on the land. On January 22, 2013, Douglas did a handwritten calculation of the purchase price of Tract V with improvements on the land at $45, 728.89 "as of 1/22/13." Beth emailed this figure to Daniel on January 27, 2013. Beth also emailed Daniel handwritten calculations from Douglas showing the figures "as of 7/30." Daniel said that he understood that the $45, 728.89 figure was the purchase price for the property, and Beth agreed that she and Douglas were willing to sell the land for that price.

         Between January and February 2013, Daniel and Douglas talked on the telephone about Daniel sending $45, 000 and paying the remaining balance of $728.89 at a later time. According to Daniel, Douglas was fine with that arrangement. Daniel, however, waited until he received his $1, 000 tax return so that he could add that to the $45, 000 he received from his boss as a loan. On March 11, 2013, Daniel's bank issued a cashier's check payable to "Doug or Beth Ready" in the amount of $46, 000, and the check was signed by Daniel's wife. When the check was mailed to Douglas and Beth, Douglas retrieved the check from their mailbox and put it "on the counter." A couple of days later, Beth asked Douglas where to deposit the check, and Douglas told her to deposit it in Maries County Bank. Thereafter, Beth mailed the cashier's check to Maries County Bank with a note to "Please deposit this on our loan account."

         When the bank received the check, it initially applied the check towards the principal on Douglas's and Beth's land loan. On April 10, 2013, Douglas contacted Maries County Bank and asked the bank to reallocate the $46, 000 on their land loan. In particular, Douglas instructed the bank to apply $11, 201.79 for the regular payment and to apply the remainder ($34, 798.21) towards the principal. Douglas never asked the bank to return the $46, 000 to him. On April 12, 2013, Maries County Bank, acting on directives from Douglas, reversed the $46, 000 principal payment and re-applied the payment as $11, 201.79 for a regular payment (consisting of $3, 099.44 as principal and $8, 192.35 as interest) and $34, 798.21 applied to principal.

         On April 22, 2013, Douglas texted Daniel and told him that he would call the title company "tomorrow. " Douglas also sent an email to Beth on that same day saying that he was "going to set the transfer of the land to Danny" on May 1, 2013. On April 23, 2013, Douglas contacted Boyd & Boyd, Inc., a land title company, regarding the sale of Tract V. Douglas requested that Boyd & Boyd issue a title insurance owner's policy in the amount of $31, 692, with a cash lender and counter closing. According to Julia Uhls, the owner of Boyd & Boyd, the date of May 1, 2013, "was chosen" as the closing date "because they wanted to do it as soon as possible and that was about the soonest Boyd & Boyd could deliver." Douglas also requested that Boyd and Boyd prepare a warranty deed to transfer the property. On April 28, 2013, Douglas texted Daniel and said, "They are supposed to call u on how the names supposed to be on title." Boyd & Boyd did contact Daniel about the name to put on the warranty deed, and Daniel instructed them to put it in his name only. On April 30, 2013, Douglas texted Daniel and said, "They only have your name on warranty deed. Is that the way u want it."

         Douglas instructed Boyd & Boyd to contact Beth when the warranty deed and title insurance policy were ready to be picked up. Boyd & Boyd prepared a title insurance owner's policy in the amount of $31, 692[4] for Tract V with the insured listed as Daniel and stating that title in the land was vested in Douglas and Beth. Boyd & Boyd also prepared a warranty deed and a billing statement for $228. The billing statement listed the customer as "Douglas Ready-Daniel L. Barkho." Beth picked up ...


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