Summary 2007 WY 184

Summary of Decision issued November 16, 2007

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Case Name: West America Housing Corp. v. Pearson

Citation: 2007 WY 184

Docket Number: S-07-0068

Appeal from the District Court of Laramie County, the Honorable Edward L. Grant, Judge

Representing Appellants (Defendants): Mary Elizabeth Galvan, Laramie, Wyoming.

Representing Appellee (Plaintiff): Don W. Riske and Sean C. Chambers of Riske, Salisbury & Kelly, PC, Cheyenne, Wyoming.

Issues: Whether a fully executed quitclaim deed, acknowledging payment of consideration and containing no reservation of rights may be set aside as void for lack of consideration under the doctrines of merger and estoppel by deed. Whether the trial court’s setting aside the quitclaim deed from Pearson to Oltman was plain error, requiring reversal to give effect to the doctrines of merger and estoppel by deed. Whether conveyance of the subject property to a party to the deed, by quitclaim deed, was sufficient to confer title in the property to the grantee, who could then dispose of the property by quitclaim deed to a subsequent grantee.

Facts/Discussion: Appellants challenge a January 2007 order of the district court which found that (1) a quitclaim deed from Pearson to Oltman was void for lack of consideration and (2) that subsequent quitclaim deeds were void because they were fraudulent conveyances. The Court made note that Joelson, Shoopman, Craver and Oltman purported to own WAHC. The district court’s order also quieted title to the disputed property in Pearson but did not award him any monetary damages.
Standard of Review: When a matter has been tried before the district court without a jury, the Court’s review of the court’s findings of fact is under the clearly erroneous standard. The issues raised in the appeal were not addressed to the district court in the proceedings below.
Appellants asserted the district court committed plain error because the principles of merger and estoppel by deed mandated reversal of the district court’s order. They also asserted that the doctrine of “merger” precluded the district court from concluding that there was no consideration paid to Pearson for the quitclaim deed because the quitclaim deed acknowledged that he received the consideration. The Court referred to their holding in Rehnberg v. Hirschberg that a contract for the sale of realty is executory until closing, at which time the contract has been executed, it merges with the deed and is no longer separately enforceable. The Court specifically stated they did not mean to dilute the important role of the doctrine by concluding that they would not consider Appellants’ contentions in that regard under the plain error rule. They noted that based on the evidence it was not plain error for the district court to conclude that the deed at issue was void for lack of consideration.
The Court stated in Kennedy Oil v. Lance Oil & Gas Co., Inc. that estoppel by deed was based upon the covenants contained in a warranty deed and does not therefore arise from a conveyance via quitclaim. The Court rejected Appellant’s claim of plain error because it was not argued to the trial court and because the plain error rule does not mandate that the Court consider it.
Since the Court affirmed the district court’s conclusion that the initial quitclaim deed was void, it flowed that the succeeding deeds were also void. However, the district court determined that they were fraudulent conveyances. The record reflects that Oltman conceded that the second and third quitclaim deeds were recorded with intent to defraud Pearson.

Holding: Based on the evidence it was not plain error for the district court to conclude that the deed at issue was void for lack of consideration. The district court’s findings were not clearly erroneous and its application of the law not in error. The order setting aside those conveyances and declaring them void was not erroneous.

Affirmed.

J. Hill delivered the opinion.

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