GLASSCOCK, Vice Chancellor.
This Opinion is unpleasant to write. I expect for some it will be painful to read. It involves at its at heart a most simple question: did the buyer and seller of commercial property in the town of Milton, Delaware, also intend to include in the sale a separate residential parcel, or was that parcel included in the sale documents by mistake? The amount at issue is small. The matter has been litigated far beyond what a rational evaluation of its costs and potential benefits would dictate. It has placed at issue documents that would otherwise be subject to attorney-client privilege, and has thus laid bare actions of individuals at respected law firms, in a way that hardly reflects well on those involved.
For the reasons that follow, I find that a deed recorded on behalf of the buyer, purporting to transfer the residential parcel, was altered by the buyer's attorney, to the detriment of the seller and without the effective consent of the seller. Because this altered deed was not signed by the seller, it is a nullity, and is ineffective to convey any property. The actual deed signed by the parties contained a reference to the residential parcel by tax number, but omitted that property from the metes and bounds description. The record makes it overwhelmingly clear that neither the buyer nor the seller intended to convey the residential property. For the sake of clarity, and in equity, I find that a reformed deed omitting reference to the residential property shall be executed and filed with the Sussex County Recorder of Deeds.
The facts below are not in dispute unless otherwise noted.
The Plaintiff, Point Management, LLC ("Point Management"), is a Delaware limited liability company comprising four members who are also family members: Colby Cox, Jessica Cox, Westley Cox, and their mother, Karla Draper. Colby Cox acted for Point Management in the sale of property to MacLaren, LLC.
Defendant MacLaren, LLC ("MacLaren"), is also a Delaware limited liability company. It is owned and managed by Dr. Jonathan L. Patterson.
Defendant and Third-Party Plaintiff Tunnell & Raysor, P.A. ("Tunnell & Raysor"), is a Delaware law firm. Tunnell & Raysor represented MacLaren in connection with its purchase of properties from Point Management and drafted the deed conveying those properties.
Third-Party Defendant Young Conaway Stargatt & Taylor ("Young Conaway") is a Delaware law firm. Young Conaway represented Point Management in its sale of properties to MacLaren and drafted the related purchase and sale agreement.
Artisans' Bank is a Delaware banking corporation holding liens for the benefit of MacLaren on properties conveyed by Point Management. Artisans' Bank was made a party to this action for notice purposes, as it holds liens on property over which Point Management claims rightful ownership, possession, and control, free of any liens or encumbrances.
On July 31, 2006, Point Management acquired property in Milton, Delaware, from Pintail Management, LLC ("Pintail"), as part of the resolution of a property division arising out of the divorce of Colby Cox's mother and stepfather. The deed named five tax parcels (the "Pintail Properties") and contained metes and bounds for each of the parcels.
On January 25, 2007, Point Management entered into an Exclusive Listing Agreement ("Listing Agreement") placing the Office Park for sale with William "Bill" Lucks of Commercial Sales Group ("CSG").
The "separate lot" referred to in the Listing Agreement is parcel 20.01, the southeastern portion of the Office Park. On June 25, 2007, Point Management deeded parcel 20.01 to O. Blake Reed and Donna Reed.
On or about August 18, 2007, Kristin Patterson, wife of Dr. Patterson, MacLaren's principal, saw a sign outside of the Office Park indicating that the property was for sale. She called CSG, whose phone number the sign listed, to inquire about the property. Rosemary Aslin received the call and scheduled a showing of the Office Park for Sunday, August 20, 2007. On that day, Aslin showed the Office Park to Dr. Patterson and his wife. The Pattersons did not view and were unaware of the Residential Property when they visited the Office Park.
After the Sunday showing, CSG, acting as dual agent for Point Management and MacLaren, prepared a document titled "Contract of Sale and Purchase Real Property," in which MacLaren offered to purchase the Office Park from Point Management for $2,000,000 (the "Offer").
Colby Cox forwarded the Offer to Jennifer Noel, a Young Conaway attorney, on the same day that he received it. Colby indicated that a few minor changes needed to be made, including the name of the seller,
After reviewing the Offer, Santaniello determined that it was "bare bones" and that it would be quicker and easier to import the key terms of the Offer into a Young Conaway template sale agreement.
On August 24, 2007, Noel sent Colby Cox the draft Sale Agreement, which included the mistaken parcel number and the metes and bounds describing the Residential Property. Cox then executed the Sale Agreement on behalf of Point Management, unaware that it contained those errors.
That same day, Dr. Patterson signed the Sale Agreement on behalf of MacLaren. At the time he signed the agreement, Patterson was also unaware that the sale included the Residential Property.
CSG added its signature to the Sale Agreement as escrow agent and then faxed the executed agreement to Karen Miller, a real estate paralegal at Tunnell & Raysor. Tunnell & Raysor was not otherwise involved in the drafting of the Sale Agreement or the signing process. Dr. Patterson claims that he felt pressured by Young Conaway to execute the Sale Agreement quickly and that he did not review the terms of the Agreement with his attorney, Harold "Hal" Dukes of Tunnell & Raysor, prior to signing.
The execution of the Sale Agreement triggered the beginning of a sixty-day due diligence period as provided in the agreement. Upon receiving the executed Sale Agreement from CSG on October 1, 2007,
During this same period, Point Management was working with RE/MAX to lease the Residential Property, clearly unaware that it had just contracted to sell that property to MacLaren. On September 11, 2007, Gregory Cox of RE/MAX, Colby Cox's father, emailed Colby Cox notifying him that tenants had been located and attaching a form to remove the Residential Property from the market.
Meanwhile, during its title search of the five parcels identified in the Sale Agreement, Tunnell & Raysor discovered that parcel 20.01, the Reed Property, was not owned by Point Management, as it had been conveyed to the Reeds in June 2007, two months before MacLaren submitted its Offer. As described above, the Reed Property was irregularly shaped and included a narrow, trapezoidal portion that protruded from the western boundary of the Reed Property into the center of the other Office Park parcels. Colby Cox testified at his deposition that when he transferred parcel 20.01 to the Reeds, he believed the trapezoidal protrusion to be a separate parcel and not part of the conveyance.
These title defects with the Reed Property and the lot line adjustments they necessitated caused multiple delays in the closing date, which was originally scheduled for October 2007. According to Tunnell & Raysor attorney Jane Patchell, numerous other title defects existed in addition to the earlier conveyance of the Reed Property, including easements for incomplete utility lines and deed restrictions that were required to be terminated and removed to provide good marketable title to MacLaren.
According to Dr. Patterson's deposition testimony, he first learned of the Residential Property during the diligence period through a conversation with Hal Dukes. Patterson testified that he was reviewing papers with Dukes when Dukes notified him that there was "a little house up the street that's included."
For his part, Dukes testified that between signing in August 2007 and closing in February 2008, though he had several conversations with Dr. Patterson, Patterson never discussed purchasing a residential property on Chestnut Street.
Of the documents circulated during the due diligence period, only the HUD-1 settlement statement (the "HUD-1") referenced the Residential Property by street address. Four versions of the HUD-1 were circulated before closing.
On February 29, 2008, Karen Miller forwarded the fourth version of the HUD-1 to Cheryl Santaniello, indicating: "There are more changes to the HUD. The City taxe [sic] have not been paid and the final water reading for 611 Federal Suite A and 515 Chestnut need to be collected."
Karen Miller soon responded to Santaniello, stating:
Santaniello then relayed this information to Cox: "[611] is a street address assigned by the town to one of the parcels that makes up the federal street industrial park. Are we ok with the HUD-1? The water bills do pertain to the property being sold."
On February 21, 2008, Milton approved the lot line adjustment and consolidation of the Office Park parcels, and the transaction proceeded to close on February 29, 2008. In the run-up to the closing, Tunnell & Raysor and Young Conaway circulated the necessary closing documents. Because Point Management would not be attending the closing, Tunnell & Raysor, on February 27th, sent Colby Cox a deed to be signed and notarized in advance of the February 29th settlement date.
Young Conaway reviewed the deed it received from Tunnell & Raysor and approved it for signature. On February 29, 2009, Cox signed the deed on behalf of Point Management and returned it to Tunnell & Raysor. This deed, which was the only deed signed by all of the parties, comprised three pages and included the tax parcel number for the Residential Property, together with those for the Office Park parcels, in the top right corner of the first page (the "Executed Deed").
The Executed Deed, i.e., the version of the deed last seen and approved by Colby Cox, was not the deed ultimately recorded. The "Recorded Deed" contained four pages instead of three, and it included an entirely new section, labeled "Tract No. 2: 2-35 20.11 52.03."
At her deposition, Patchell testified that after the closing she discovered the discrepancy between the tax parcels named in the Executed Deed and the properties described in the metes and bounds.
On March 11, 2008, Tunnell & Raysor forwarded the final version of the HUD-1 by email to Stephen Melanson, a Point Management representative. As discussed above, the HUD-1 referenced a water bill due for 515 Chestnut Street. In this email, Jane Patchell asked Melanson to confirm whether "the two tenants at Federal Street Office Park made their March rental payments to Point Management."
Over the next several months, Point Management took actions consistent with its purported belief that it still owned the Residential Property. In September 2008, Point Management and the LoBiandos renewed their lease agreement.
The dispute over the rightful ownership of the Residential Property would not materialize until January 2009, nearly a year after settlement, when Dr. Patterson contacted Tunnell & Raysor regarding tax or water bills he had paid on parcel 52.03, which Dr. Patterson would soon learn was an occupied residence. Among the documents circulated at the closing was an Assignment and Assumption of Leases from Point Management to MacLaren. The executed version of this document identifies the two tenants at the Office Park but makes no reference to the LoBiandos, the Residential Property tenants.
Dr. Patterson also called Hal Dukes sometime in January 2009 expressing the same concern regarding a tax or utility bill he had paid.
According to Dukes, he contacted Karen Miller, the real estate paralegal who had worked on the transaction, and the next morning Dukes's office prepared and delivered to Dr. Patterson a corrective deed that omitted the Residential Property (the "Corrective Deed").
Patchell responded to Dr. Patterson's email regarding the tax bills on January 21, 2009, and confirmed that parcel "22352011001900" represented former parcels 19.00, 20.02, 22.00, and part of 20.01 (the Reed Property protrusion), as combined by Sussex County.
Dr. Patterson was apparently confused by Patchell's response. He replied, "In the last settlement meeting, I think Hal said that the property is two parcels in case I wish to sell one. But maybe Hal could comment."
Evidencing his continued confusion regarding the properties owned by MacLaren and a lack of knowledge of the Residential Property, Dr. Patterson responded, "We do not own the lot on Chestnut St. It was bought by the Reeds as part of the settlement. If I understand this correctly, did I pay their property taxes (2352011005203 $571.20?) this round. Please comment."
It is an ill wind indeed that blows no man good. At some point following his phone conversation with Hal Dukes and his email exchange with Jane Patchell, Dr. Patterson's attitude toward the Residential Property apparently shifted from one of concern for liability exposure in a property he had not intended to purchase to one of opportunism born from the notion that he might get a free house out of this mess. By letter dated January 23, 2009, Dr. Patterson's wife advised the LoBiandos that MacLaren owned the Residential Property and that future rent should be paid to MacLaren.
Representing his change of heart in this matter, Dr. Patterson emailed his Tunnell & Raysor attorneys on January 26, 2009, informing them of Cox's communication with Dr. Patterson's wife:
Patchell responded to Dr. Patterson's email, indicating that she had just spoken to Cheryl Santaniello of Young Conaway, who had indicated that the inclusion of the Residential Property was a mistake.
Patchell's email conflicts with Dr. Patterson's assertion that Tunnell & Raysor alerted him to the Residential Property before settlement.
When Dukes did not receive a signed version of the Corrective Deed he had sent to Dr. Patterson, they communicated again. Though the record is unclear as to who initiated the phone call and when exactly the call occurred, Dr. Patterson's email exchange with Jane Patchell, described above, indicates that in late January 2009, Dr. Patterson wished to speak with Dukes and provided his phone number to Patchell for that purpose. At his deposition, Dukes recounted his conversation with Dr. Patterson:
In a January 28, 2009, voicemail left with Cheryl Santaniello, Dukes conveyed Dr. Patterson's stance regarding the Residential Property. Dukes explained that Dr. Patterson did not "per se" object to anything wanted by Santaniello or Colby Cox, but that Dr. Patterson needed time to "think it over" because he had paid for a title search and some legal work in connection with the Residential Property.
Apparently dissatisfied with the advice he was receiving from his Tunnell & Raysor attorneys, Dr. Patterson at some point reached out to David Barrett, his father-in-law and a Washington, D.C., attorney. On January 31, 2009, Dr. Patterson emailed Dukes and Patchell expressing that he appreciated the excellent service of Tunnell & Raysor and that he looked forward to working with the firm in the future.
Dukes responded that Cheryl Santaniello should be notified of Barrett's involvement on the ground that she might "make [Barrett] see that this matter will not result in a free house for Dr. Patterson."
Despite Dr. Patterson's email to Tunnell & Raysor requesting that any further discussion of the Residential Property with Cox's attorneys be directed to David Barrett, Tunnell & Raysor continued to communicate with Young Conaway and other attorneys who became involved as the dispute spiraled out of control. In a February 2, 2009, email to Santaniello, Patchell indicated that she and Dukes had spoken with Gene DiPrinzio, another attorney from Young Conaway, that afternoon, and that "[b]ased upon that conversation, Hal Left a message for Joe and Jan LoBiando on their home voice mail to continue paying monthly rent for 515 Chestnut Street to Colby Cox. . . . Hal has known Joe and Jan for years."
Several weeks later, by letter dated March 20, 2009, Dukes contacted David Barrett, stating that "it would appear that MacLaren, LLC should sign a corrective deed as soon as possible and straighten out this matter without the cost and time of litigation."
Shortly after Point Management initiated this action, on September 2, 2009, Dukes sent out two more letters, one to John Sergovic of Sergovic, Carmean & Wiedman, P.A., then-attorney for MacLaren,
In a similar letter to John Sergovic, Dukes expressed his positions that the Residential Property was conveyed by mutual mistake and that Dr. Patterson's statements demonstrated that "he had no knowledge of this property, had never looked at the property, did not intend to include this property in his offer to purchase the office park and that the lending institution had never appraised the property as part of the business park loan."
On August 29, 2009, Point Management filed a Verified Complaint asserting eleven counts against MacLaren, Tunnell & Raysor, and Artisans' Bank, including claims for reformation, fraud, misrepresentation, breach of contract, mistake, unjust enrichment, tortious interference, conversion, imposition of a constructive trust, and a notice count against Artisans' Bank. On January 15, 2010, Tunnell & Raysor filed a motion to dismiss the claims against it. On December 14, 2010, by telephonic ruling, I dismissed the claims of fraud and misrepresentation alleged against Tunnell & Raysor. In my ruling, however, I acknowledged that Point Management appeared to have claims against Tunnell & Raysor as the settlement agent, but that those claims did not lie in misrepresentation or common law fraud. Thus, I deferred dismissal for thirty days to allow Point Management to amend its complaint.
On January 5, 2011, Point Management filed its Verified Amended and Supplemental Complaint (the "Amended Complaint"), in which it asserts ten counts. Count I seeks a declaration that the Recorded Deed is defective on the ground that it was not the deed executed by the parties. Count I also seeks an order providing that a corrective deed conveying only the Office Park be executed and delivered by Point Management and accepted and recorded by MacLaren.
Count II seeks reformation of the Recorded Deed on account of mutual mistake. Point Management asserts that neither the Sale Agreement nor the Recorded Deed reflects the intent of the parties and that both documents should be reformed to remove all reference to the Residential Property.
Count III seeks reformation on the ground of mutual mistake coupled with inequitable conduct. Point Management alleges inequitable conduct on the part of Tunnell & Raysor for filing a different deed than the one executed and for failing to inform Point Management for nearly one year that it had filed an altered deed. MacLaren is alleged to have initially agreed to correct the mistaken conveyance of the Residential Property before inequitably shifting its position and claiming rightful ownership of the property.
Count IV alleges breach of contract and negligence as a settlement agent against Tunnell & Raysor for inducing Point Management to rely on Tunnell & Raysor's representation that the deed it provided to Point Management for execution would be the deed filed. Point Management alleges that in filing an altered deed and in failing to inform Point Management of its having done so, Tunnell & Raysor, acting on behalf of MacLaren, breached an implied contract between Tunnell & Raysor and Point Management and negligently harmed Point Management.
Count V asserts a legal malpractice claim against Tunnell & Raysor on the basis that it owed duties of care and candor to Point Management and that it breached those duties when it recorded the altered deed and did not inform Point Management that it had done so.
Count VI alleges that, in the event that Tunnell & Raysor thought the Residential Property was part of the transaction, it was negligent in failing to include a description of that property in the deed it provided to Point Management for execution.
Count VII accuses MacLaren of tortiously interfering with Point Management's contract with the former tenants of the Residential Property.
Count VIII alleges unjust enrichment and conversion against MacLaren for obtaining the Residential Property without consideration, ejecting the tenants therein, and wrongfully continuing to possess and use the Residential Property without the permission of or compensation to Point Management.
Count IX seeks the imposition of a constructive trust against MacLaren with respect to all funds, consideration, and other things of value received by MacLaren as a result of its allegedly wrongful possession of the Residential Property.
Count X seeks to put Artisans' Bank, the holder of allegedly wrongful encumbrances on the Residential Property, on notice of Point Management's claims of rightful ownership, possession, and control of the Residential Property free and clear of liens and encumbrances placed thereon by or for the benefit of MacLaren.
Tunnell & Raysor answered the Amended Complaint on January 20, 2011, and asserted counterclaims and crossclaims for contribution or indemnification against all other parties, except for Artisans' Bank.
MacLaren answered the Amended Complaint on February 8, 2011, and asserted counterclaims against Point Management.
On February 1, 2011, Tunnell & Raysor filed a third-party complaint against Young Conaway asserting that Young Conaway was negligent throughout the course of the transaction, particularly in its preparation of the Sale Agreement, and breached its contractual duties to Point Management. Tunnell & Raysor asserts that, on these bases, it is entitled to contribution or indemnification from Young Conaway for any liability assessed against Tunnell & Raysor arising out of the transaction at issue.
Point Management and MacLaren have cross-moved for partial summary judgment on the issue of reformation. Tunnell & Raysor has moved for summary judgment on the counts asserted against it by Point Management—breach of contract and negligence as a settlement agent, legal malpractice, negligence, and unjust enrichment and conversion. Young Conaway seeks summary judgment against Tunnell & Raysor's claims for contribution and indemnification.
This Opinion addresses those motions.
Summary judgment is appropriate where the record reflects that no genuine issue of material facts exists and that the moving party is entitled to judgment as a matter of law.
The deed recorded on March 4, 2008, was not a document signed by the parties to the real estate transfer. Its metes and bounds description included the Residential Property, which the description in the Executed Deed did not. The Executed Deed, post execution, was placed in the possession of MacLaren's attorney who, as agent for the parties, was charged with recording it with the Sussex County Recorder of Deeds.
Upon review of the Executed Deed, however, the undisputed facts indicate that MacLaren's attorney, Ms. Patchell, noticed an inconsistency between the Sale Agreement and the Executed Deed, in that the latter did not include the Residential Property in the metes and bounds description. She therefore created a new document, the Recorded Deed. The Executed Deed was three pages long, and the third page was the signature page. Patchell created a new page three for the Recorded Deed, which comprised the metes and bounds description of the Residential Property "missing" from the Executed Deed. She renumbered the signature page (page three) of the Executed Deed as page four of the Recorded Deed, and attached that signature page to the Recorded Deed as though the parties had executed the Recorded Deed, and not the Executed Deed. She then caused this document, the Recorded Deed, to be recorded as though it were the deed executed by the parties. These facts are not in dispute.
The parties disagree vehemently, however, as to what permission, if any, was given by Point Management to MacLaren's attorney to alter the Executed Deed. According to Ms. Patchell, she spoke to Colby Cox on the telephone and explained that there was an inconsistency between the Sale Agreement and the Executed Deed. She purportedly sought Cox's permission to reconcile the property listed in the Executed Deed with the property described in the Sale Agreement. Patchell claims to have spoken directly to Cox, without his attorney present. Patchell admits that she did not tell Cox that the language she wished to add to the deed described the transfer of a parcel noncontiguous with the Office Park, or that it was a residential, rather than a commercial, property. She also did not tell Cox the address of the parcel to be added or read to Cox the description she intended to add to the deed. Patchell failed to send the new language she intended to add to the deed to Cox, or to his attorney, for review. Patchell never notified Cox's attorney that the deed had been altered. After receiving Cox's permission to make the change she had vaguely described, according to Patchell, she made the alteration in the deed.
Cox strongly denies that this conversation took place or that he ever authorized any alteration of the Executed Deed.
Assuming for purposes of this Opinion that Patchell's version of events is correct, the permission she received from Cox is insufficient to ratify the altered document she caused to be recorded with the Sussex County Recorder of Deeds.
That leaves, as between the parties, the Executed Deed as the effective deed. As described below, that deed does not transfer the Residential Property.
Because the Recorded Deed is a nullity, the Executed Deed is the operative document. The application of well-settled principles of deed construction supports a finding that the Executed Deed did not transfer the Residential Property. "The construction of a deed is a question of law."
The Executed Deed is not internally consistent. The legal description begins by identifying the subject properties as
As is clear from the referenced consolidation plan,
Some elements of the Executed Deed appear to contradict these clear exclusions of the Residential Property. The top-right corner of page one of the Executed Deed lists tax parcel 52.03.
The evidence of record overwhelmingly reflects that Point Management did not intend to sell and MacLaren did not intend to purchase the Residential Property. To begin with, the interactions between Point Management, MacLaren, and CSG, the real estate agency responsible for selling the Office Park, do not evidence an intent to convey the Residential Property. The Listing Agreement did not mention the Residential Property, and affidavits submitted by CSG agents Bill Lucks and Rosemary Aslin confirm that they had no knowledge of the Residential Property, that they did not list the Residential Property, and that the transaction in which they served as dual agents for Point Management and MacLaren was for the Office Park only. In fact, Point Management listed the Residential Property separately with RE/MAX. Moreover, Aslin showed only the Office Park to the Pattersons, who did not actually visit the Residential Property until January 2009, almost a year after settlement. Dr. Patterson has additionally confirmed that he was not aware of the Residential Property when Aslin showed him the Office Park in August 2007. Finally, the introduction of the Residential Property into the transaction occurred not by an act of either of the parties, but by a mistaken reference in the Offer drafted by CSG to the deed conveying the Pintail Properties.
The interactions between the parties and their attorneys up to and beyond the signing of the transaction also dispel any notion that the Residential Property was meant to be included. Colby Cox told his attorneys from Young Conaway that he intended to convey the Office Park; he made no mention of the Residential Property. Rather, Young Conaway clearly added the Residential Property by mistake, committing the same error made by CSG in using the Pintail Properties as a reference during the drafting process. Dr. Patterson admits that when he signed the Sale Agreement, drafted by Young Conaway, he was not aware of the Residential Property, had never visited it, and thought he was buying the property shown to him by Rosemary Aslin—the Office Park.
Evidence from the due diligence period and the closing of the transaction further weighs against the inclusion of the Residential Property. Dr. Patterson had the Office Park inspected but did not do the same for the Residential Property. Nor did Dr. Patterson inform his lender, Artisans' Bank, of the Residential Property. Post-signing, Point Management continued to act consistent with its belief that it owned the Residential Property, working with RE/MAX to sell or lease the property and eventually renting it out to the LoBiandos in a one-year agreement that included a right of first refusal in the event of a sale. Further, in the only instance in which Cox saw the address of the Residential Property, as opposed to its tax parcel number, in the context of the Point Management-MacLaren transaction, Cox immediately expressed his confusion to Young Conaway and informed his attorneys that Point Management was not selling the Residential Property. Unfortunately, in response Young Conaway assured Cox that the listing of utility charges for the Residential Property in the HUD documents was probably only a result of Milton collecting payments from him due to his common ownership of the Office Park.
Events surrounding the closing also belie Dr. Patterson's purported intent to purchase the Residential Property. The Assignment and Assumption of Leases circulated at closing, though transferring the leases of the Office Park tenants, made no mention of the Residential Property tenants.
After closing in March 2008, Point Management continued to act as if it had not conveyed the Residential Property, as it worked with the LoBiandos to establish a back rent payment plan. Point Management's ownership of the Residential Property was apparently unquestioned until January 2009, when Dr. Patterson received a utility bill for that property. According to Hal Dukes, Patterson became upset because he had no intention of purchasing a residential property, had no insurance on the Residential Property, and did not know who owned the property or who occupied it. Dukes testified that Patterson wanted the problem rectified immediately. In one email exchange with Jane Patchell, in which Patchell explicitly described a residential property noncontiguous with the Office Park, Patterson indicated that MacLaren did not own a Chestnut Street property.
Dr. Patterson soon changed his tune, however. Once informed by his Tunnell & Raysor attorneys that the Residential Property was in his name, Patterson seemingly convinced himself that he was entitled to retain the property. Dr. Patterson's sense of entitlement was not mollified by the advice of Hal Dukes,
The only evidence presented by MacLaren in support of Dr. Patterson's purported intent to purchase the Residential Property is Dr. Patterson's deposition testimony. Yet over the course of multiple depositions, not once did Dr. Patterson affirmatively represent that he intended to purchase or expected to receive the Residential Property as part of the transaction. When asked this most basic and central question, i.e., what he intended to purchase, Dr. Patterson supplied circuitous half-answers. For example, when asked what his expectation was as to what he was purchasing for $2 million, Patterson responded that he expected to purchase "[w]hat was described in the contract."
Patterson even refused to acknowledge whether he knew or did not know what he was purchasing from Point Management:
Dr. Patterson's testimony can essentially be summarized as, "I intended to purchase whatever was in the contract, though I had no idea what was in the contract." In other words, Patterson argues that MacLaren intended to purchase whatever it ultimately purchased, grab-bag fashion. This circular reasoning does not controvert the ocean of evidence indicating that neither Point Management nor MacLaren intended to include the Residential Property. Tellingly, not once during his multiple depositions did Dr. Patterson testify in a straightforward manner that he intended to purchase the Residential Property. No amount of circuitous prevarication by Dr. Patterson can conceal the fact that, despite numerous opportunities, he never asserted under oath the very position he now argues before this Court.
The Plaintiff offered in its briefing an analogy which I find apt.
In his testimony since, Dr. Patterson has artfully avoided answering whether MacLaren actually intended to purchase the Residential Property from Point Management, a straightforward issue that has somehow generated countless hours of legal work and innumerable pages of legal briefing and document production. Though these efforts may have squandered attorney and judicial resources, they have nonetheless resulted in a staggering amount of evidence confirming that the parties did not intend to include the Residential Property in the transaction.
The only evidence suggesting that Patterson even knew of the Residential Property before closing is his contention that Hal Dukes informed him of that property's existence during the diligence period.
MacLaren argues that (1) Patterson's purported pre-closing awareness of the Residential property and (2) Patterson's testimony that he intended to purchase "what was described in the contract" support MacLaren's argument that it intended to purchase the Residential Property. In ruling on a motion for summary judgment, this Court must determine whether a genuine issue of material fact exists requiring a trial.
Patterson's self-interested, ex post averments that he intended to purchase "whatever was in the contract" do not directly contradict the Plaintiff's assertion that the parties did not intend to include the Residential Property in the transaction, an assertion verified by the record evidence. Further, MacLaren's arguments find no support from Dr. Patterson's testimony regarding his pre-closing conversation with Hal Dukes. Even if that conversation occurred as described by Patterson, no rational fact-finder could find, in light of the overwhelming evidence to the contrary, that, because of Dukes's comments, Patterson expected to receive a noncontiguous residential property as part of the transaction. Thus, no genuine issue of material fact requiring a trial exists regarding the effect of the Executed Deed.
MacLaren has not argued in the alternative that the Executed Deed should be reformed to include the Residential Property. A party seeking reformation must prove by clear and convincing evidence that the parties came to a specific prior understanding that differed materially from the written agreement.
The operative deed here, the Executed Deed, has not been recorded. Moreover, the Executed Deed contains inconsistencies that I have resolved in this Opinion, but which have the potential for confusion if that deed is recorded. The parties shall execute a corrective deed that corrects the parcels listed on page one of the Executed Deed to match the metes and bounds in that document (i.e., the reference to tax parcel 52.03 on page one shall be removed). Additionally, the "BEING" clause on page two of the Executed Deed shall be corrected to read "BEING part of the lands conveyed to Point Management, LLC from Pintail Management, LLC . . . ." Any additional corrections necessary to remove all reference to the Residential Property from the Executed Deed shall also be made. This corrective deed shall be recorded in substitution for the Recorded Deed, nunc pro tunc. The parties shall provide me a form of order to be recorded with the corrective deed, consistent with this Opinion.
The findings in this Opinion will necessarily affect the outstanding motions of Young Conaway and Tunnell & Raysor. The parties should supplement or revise their arguments accordingly. I will schedule a conference with all of the parties to discuss how to proceed on the remaining claims and motions. The parties should confer in advance and determine what supplementation of the existing briefing is necessary.
For the reasons above, MacLaren's Motion for Partial Summary Judgment is denied. Because I have found that the Recorded Deed is a nullity, and that the Executed Deed does not convey the Residential Property, Point Management's Motion for Summary Judgment seeking reformation of the deed is moot. A corrective deed shall be filed consistent with this Opinion, however, removing ambiguities from the Executed Deed. The parties shall provide a form of order consistent with this Opinion.
Though I do not doubt that Ms. Miller testified honestly, the email's meaning appears contrary to her recollection. Both the Tunnell & Raysor version and the version cited by Point Management suggest that the "Round Pole Branch" line was meant to describe 515 Chestnut Street, while the "Federal Street Office Park" line was meant to describe the three listed Federal Street properties. The Young Conaway version is at most ambiguous. Moreover, regardless of whether Ms. Miller intended "Federal Street Office Park" to refer a Chestnut Street property listed in a separate paragraph and identified as "part of [the] subdivision of Round Pole Branch," it is difficult to take seriously the argument that a property that (1) in no way abuts Federal Street, (2) is residential, (3) is noncontiguous with the other properties composing the Office Park, and (4) is absent from any plot plan or survey of record depicting the Office Park is nonetheless part of the Federal Street Office Park.
Id. at 18:22-19:5.