Baker Farms v. LDS CORP.

42 P.3d 715, 136 Idaho 922
CourtIdaho Court of Appeals
DecidedMarch 4, 2002
Docket26602
StatusPublished
Cited by1 cases

This text of 42 P.3d 715 (Baker Farms v. LDS CORP.) is published on Counsel Stack Legal Research, covering Idaho Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Baker Farms v. LDS CORP., 42 P.3d 715, 136 Idaho 922 (Idaho Ct. App. 2002).

Opinion

42 P.3d 715 (2002)
136 Idaho 922

WADE BAKER & SONS FARMS, a partnership, Plaintiff-Counterdefendant-Appellant,
v.
CORPORATION OF THE PRESIDING BISHOP OF THE CHURCH OF JESUS CHRIST OF LATTER-DAY SAINTS, a Utah corporation; and Larry Adams, Defendants-Counterclaimants-Respondents.

No. 26602.

Court of Appeals of Idaho.

March 4, 2002.

*716 Anderson, Julian Hull, Boise, for appellant. Kenneth D. Nyman argued.

Service, Gasser Kerl, Pocatello; Parsons, Smith Stone, Burley, for respondents. Ron Kerl argued.

LANSING, Judge.

This action stems from a real estate transaction in which the purchaser of agricultural land agreed to collect rent from a lessee for the next farming season and remit the rental to the seller. When this rental payment was not made, the seller brought this action against the purchaser. The district court granted summary judgment for the purchaser on the basis that a condition precedent to the purchaser's obligation-payment of rent by the lessee-had not occurred and that the seller's interference had caused or contributed to the nonoccurrence of that condition precedent. We conclude that there are material factual issues that make summary judgment inappropriate, and we therefore vacate the judgment and remand this case for further proceedings.

I.

FACTUAL AND PROCEDURAL BACKGROUND

In the fall of 1994, plaintiff Wade Baker & Sons Farms ("Baker Farms") owned a 375 acre parcel of agricultural land and also held an option to repurchase another parcel of approximately 1,800 acres that Baker Farms had previously owned. Apparently anticipating that it would reacquire the 1,800 acres, Baker Farms entered into negotiations with a farmer, Larry Adams, for Adams to lease approximately 600 acres of the 1,800-acre parcel. However, in December 1994, before having signed a lease with Adams, Baker Farms began negotiating to sell its option on the 1,800-acre parcel to defendant Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints (the "LDS Corporation"). The LDS Corporation wanted to make this purchase but also wanted to purchase Baker Farms' 375 acre parcel. As part of the consideration to induce Baker Farms to sell the 375 acre piece, the LDS Corporation agreed that Baker Farms could retain the monetary benefit of the anticipated lease of the 600 acres to Adams, which called for Adams to pay rental of approximately $180,000. The parties structured the payment in this manner—as a retention by *717 Baker Farms of rental from the larger parcel—in an effort to shelter that payment from the reach of an Internal Revenue Service lien on the 375-acre parcel.

On January 19, 1995, the contract for the sale of the 1,800-acre parcel closed. On the same date, the LDS Corporation's attorney sent a letter to Baker Farms' attorney expressing the concern that the LDS Corporation's obligation to pay to Baker Farms the rent from the 600 acres "should be conditional" upon the LDS Corporation's receipt of the rent from Adams. In response to this concern, Baker Farms' attorney drafted a contract titled "Agreement Re: Payment of $180,000" that included the following clauses:

(a) It is understood and agreed by the Church and Baker Farms that simultaneous with the purchase of the 375 deeded acres ... the Church shall pay Baker Farms the sum of $180,000. The payment of $180,000 is conditioned upon not only the purchase and sale of the 1,855.593 acres but the sale of the 375 acres ....
(b) It is understood and agreed that simultaneous with the sale by Baker and the purchase by the Church of the 375 acres ..., the Church shall wire transfer to the trust account of [Baker Farms' attorney] the sum of $180,000 as rent which Baker is entitled to receive. The actual disbursement of the funds shall be made immediately after the 375 acre sale is concluded and the title insurance company has bound itself to issue title insurance and the rent has been paid.

(Emphasis added.) This draft agreement further provided that if Adams did not lease the 600 acres, then Baker Farms would be entitled to arrange for the lease of that parcel by a third party and to receive the lease rent, and if no third-party lease could be arranged, then Baker Farms would be entitled to farm the same acreage without payment of rent.

Baker Farms' attorney delivered a draft of this agreement on January 20, and the LDS Corporation's attorney responded with a letter of the same date indicating that the draft agreement had been accepted. For reasons that are not explained in the record, this contract was not signed by either party. Both parties acknowledge, however, that it accurately expresses the terms to which they had agreed as of January 20, 1995. The sale of the 375-acre parcel closed in May 1995. Baker Farms waived the requirement that the $180,000 be paid immediately after this closing, apparently to prevent the payment from coming to the attention of the Internal Revenue Service.

In the spring of 1995, Adams was allowed to begin farming operations on the 600 acres even though no lease was yet executed between him and the LDS Corporation and no rent had been paid. A lease was later executed, apparently in the late spring or early summer. It provided that the annual rent in an amount exceeding $185,000 was due and payable upon signing the lease, but Adams paid no rent. Adams represented to the LDS Corporation that he had paid the rent directly to Baker Farms through some side agreement involving a custom farming contract, a contention that Baker Farms denies. The LDS Corporation accepted Adams' representation of having paid the rent without obtaining confirmation from Baker Farms. Despite Baker Farms' subsequent demands, the LDS Corporation never collected the rent from Adams and never paid the $180,000 to Baker Farms. This action for collection of the sum was filed by Baker Farms in December 1997.

The LDS Corporation moved for summary judgment on two bases. First, it argued that under terms of the parties' oral agreement, as described in the January 20, 1995 unsigned contract, Adams' payment of the rent to the LDS Corporation was a condition precedent to the LDS Corporation's obligation to remit the $180,000 payment to Baker Farms. Because Adams had never paid the rent, the LDS Corporation asserted that its performance had never come due with respect to the $180,000. In the alternative, the LDS Corporation argued that a principal of Baker Farms, Rell Baker, had interfered with the collection of Adams' rent by giving Adams permission to delay the payment of rent. The district court accepted both of these arguments and granted summary judgment dismissing the action against the LDS Corporation. On appeal, Baker Farms contends *718 that the district court made errors of law and that there are material issues of fact that make summary judgment impermissible.

II.

ANALYSIS

Summary judgment is appropriate only if "the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." I.R.C.P. 56(c). Thus, "if uncontroverted facts lead to a definite disposition as a matter of law, summary judgment is appropriate." Jordan v. Beeks, 135 Idaho 586, 590, 21 P.3d 908, 912 (2001). A court considering a summary judgment motion must liberally construe the evidence in favor of the party opposing the motion and draw all reasonable inferences in that party's favor. Id.;

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Bluebook (online)
42 P.3d 715, 136 Idaho 922, Counsel Stack Legal Research, https://law.counselstack.com/opinion/baker-farms-v-lds-corp-idahoctapp-2002.