Cristie A Binhammer v. Daniel W Reilly

• Court: Court of Appeals of Virginia
• Decided: February 11, 2003
• Docket: 1907012
• Status: Unpublished

Opinion

COURT OF APPEALS OF VIRGINIA

Present: Judges Frank, Felton and Kelsey Argued at Richmond, Virginia

CRISTIE A. BINHAMMER MEMORANDUM OPINION * BY v. Record No. 1907-01-2 JUDGE WALTER S. FELTON, JR. FEBRUARY 11, 2003 DANIEL W. REILLY

FROM THE CIRCUIT COURT OF CHESTERFIELD COUNTY Herbert C. Gill, Jr., Judge

Paul T. Buckwalter, II, for appellant.

Jennifer E. Crossland (William H. Parcell, III; Parcell, Webb & Wallerstein, P.C., on briefs), for appellee.

Cristie Binhammer ("Binhammer") appeals from a final order of

partition of the marital home dated June 8, 2001. She contends on

appeal that the trial court erred (1) in voiding as a mutual

mistake of facts, the property clause, paragraph (D)(16), in the

property settlement agreement; (2) in failing to estop Daniel

Reilly ("Daniel") from claiming a higher value for his interest in

the family home, after acquiring his father's interest; and (3) in

rewriting the terms of the property settlement agreement and

increasing the value of Daniel's interest in the family home. For

the following reasons, we affirm the judgment of the trial court.

* Pursuant to Code § 17.1-413, this opinion is not designated for publication. I. BACKGROUND

On June 14, 1980, Cristie Binhammer and Daniel Reilly were

married. In June 1987, with the substantial financial

assistance of Daniel's father, William Reilly ("William"), the

couple purchased a house. William provided the couple with

approximately $10,000 as a down payment on the real estate and

for closing costs. He was an applicant with Binhammer and

Daniel for the purchase money loan for the property.

Binhammer and Daniel dispute whether the $10,000 was a loan

or a gift. Binhammer claims the money was a gift. Daniel

contends the money was a loan and that his father informed the

couple that they did not have to pay interest to him on the

$10,000 he provided. However, Daniel further contends that if

the house was sold, his father expected to be repaid. In

addition, the parties agreed that in return for the down

payment, William would be permitted to claim the value of

mortgage interest payments as a deduction on his tax returns.

He filed for the deduction on his tax returns each year until

1996, even though Daniel and Binhammer separated in 1991 and

divorced in 1993. In 1996, Binhammer refused to provide William

Reilly with the necessary documentation to claim the interest

deduction.

On June 12, 1987, the house was conveyed by deed to

Binhammer, Daniel, and William. The deed conveyed the property

as follows:

- 2 - This deed made this 12th day of June, 1987, by and between Richard G. Zyne and Paula C. Zyne, husband and wife, herein called "Grantor" and Daniel W. Reilly and Cristie A. Reilly, husband and wife, and William C. Reilly, herein called "Grantee":

Witness that for and in consideration of the sum of Ten Dollars ($10.00) and other valuable consideration . . . the said Grantors do hereby grant and convey with General Warranty and English Covenants of Title to the said Daniel W. Reilly and Cristie A. Reilly, his wife, a two thirds undivided interest as tenants by the entirety with the right of survivorship as at common law in and to the below described real property and to William C. Reilly, married, a one third undivided interest as his sole separate equitable estate to be held, owned, and disposed of as hereinafter set forth in and to the below described real property; the said Daniel W. Reilly and Cristie A. Reilly, his wife, and William C. Reilly, married, to hold title as joint tenants with the right of survivorship as at common law . . . .

(Emphasis added.)

On June 16, 1991, Binhammer and Daniel separated. On March

22, 1993, they entered into a property settlement agreement that

purported to address, among other things, their respective

interests in the home. The property settlement agreement states

in relevant part:

D. REAL ESTATE

16. MARITAL RESIDENCE. The parties agree that Husband's share of the equity in the home shall be fixed at $2,000.00 and shall be paid by Wife to Husband upon the earlier of (a) the sale of the home or (b) remarriage of the Wife.

- 3 - Husband hereby relinquishes all right, title and interest in the home other than that designated herein. Wife shall be responsible for all maintenance.

This agreement is based upon the following assumptions:

(1) Husband's father has no financial claim against the home.

(2) Wife is free to sell the home at her sole discretion.

(3) Husband may not use this figure to offset other obligations.

William was not a party to the property settlement

agreement and was not consulted by Binhammer or her attorney,

who prepared the document, prior to the execution of the

agreement. The agreement was affirmed, ratified, and

incorporated into the final decree of divorce on May 4, 1993.

On August 1, 1996, William Reilly executed a will leaving his

interest in the home to his son. The will states in pertinent

part:

I devise all of my right, title and interest in and to certain lot(s) and home located at 8245 Greenock Drive, Richmond, VA 23235, to my son, Daniel W. Reilly, in fee simple. Any indebtedness on said property will be assumed by Daniel W. Reilly and not paid from my estate.

In 1997, on a date not specified in the record, Binhammer

remarried. Subsequent to the marriage, however, she failed to

pay Daniel the $2,000 for his share of the equity in the home,

as required by the property settlement agreement. Also in 1997,

- 4 - Binhammer filed an application to obtain a loan for the home.

In order to obtain the loan, she mailed a deed to Daniel and

William asking for the transfer of their respective interests in

the home to her so that she would be the sole owner of the

property. Neither signed the deed because of the final illness

of William. The loan fell through.

Shortly thereafter, William Reilly died. Relying on the

provisions of his father's will, Daniel asserted ownership to

his father's one-third interest in the home. Relying on the

property settlement agreement, Binhammer initiated a suit for

specific performance to obtain, for $2,000, the original

one-third interest held by Daniel as well as the one-third

interest that passed to him through William's will.

On November 2, 2000, following a number of hearings, the

trial court held that the disposition of the marital residence

was based on certain assumptions, assumptions that "were not

accurate and constitute a mutual mistake of fact. The first

assumption was that 'husband's father has no financial claim

against the home.' The evidence is clear that the husband's

father had a legal interest in the home and, therefore, had a

financial claim against the home." As a result, the court

severed paragraph (D)(16) from the property settlement agreement

relating to the sale of the marital property and held the real

estate was subject to partition. Based on the language of the

1987 deed conveying the property and the transfer of William's

- 5 - interest at his death, the trial court ruled that Daniel owned a

two-thirds undivided interest in the property and that Binhammer

owned a one-third undivided interest.

On March 7, 2001, an ore tenus hearing was held. The trial

court reiterated its finding that Daniel owned a two-thirds

undivided interest and that Binhammer owned a one-third

undivided interest in the property. It set the equity property

value at $33,441.15 and permitted either party to purchase the

share of the other party. On June 8, 2001, the trial court

entered a final order of partition. Daniel was ordered to

convey his two-thirds interest in the property to Binhammer in

return for payment in the sum of $22,291.87. Binhammer

subsequently paid Daniel for his two-thirds undivided interest

and Daniel conveyed to Binhammer by deed, his undivided

interests in the subject property.

II. ANALYSIS

"Under familiar principles we view [the] evidence and all

reasonable inferences in the light most favorable to the

prevailing party below. Where, as here, the court hears the

evidence ore tenus, its finding is entitled to great weight and

will not be disturbed on appeal unless plainly wrong or without

evidence to support it." Pommerenke v. Pommerenke, 7 Va. App.

241, 244, 372 S.E.2d 630, 631 (1988) (quoting Martin v.

Pittsylvania Dep't of Soc. Servs., 3 Va. App. 15, 20, 348 S.E.2d

13, 16 (1986)).

- 6 - This matter has been subject to a long and tortuous

journey, including several prior show cause orders issued by

this Court resulting from Binhammer's failure to adhere to our

rules for filing an appeal. The sole issue before us is whether

the trial court correctly determined the value of the parties'

respective interests in the marital home. The dispute arises

out of paragraph (D)(16) of the property settlement agreement

relating to the disposition of the marital home.

During oral arguments on November 14, 2002, the question

was raised as to whether we had jurisdiction to hear the appeal

from the final order of partition, a proceeding in equity. The

parties were asked to brief this additional question. Having

reviewed the briefs filed by counsel and considered the matter,

we conclude that we have jurisdiction pursuant to Code

§§ 17.1-405(3)(f) and 8.01-670(A)(1)(a).

A. MUTUAL MISTAKE

We first consider whether the trial court erred in voiding

as mutual mistake of facts, paragraph (D)(16) of the property

settlement agreement. We find that it did not.

Generally, "[i]f certain facts are assumed by both parties as the basis of the contract, and it subsequently appears that such facts did not exist, the contract is inoperative." Virginia Iron, Coal, & Coke Co. v. Graham, 124 Va. 692, 708, 98 S.E. 659, 664 (1919).

The mistake may be common to both parties to a transaction, and may consist either in the expression of their agreement, or in some

- 7 - matter inducing or influencing the agreement, or in some matter to which the agreement is to be applied. Nothing is more clear in equity than the doctrine that a contract founded in mutual mistake of the facts constituting the very basis or essence of it will avoid it.

Jennings v. Jennings, 12 Va. App. 1187, 1192, 409 S.E.2d 8, 12

(1991).

We agree with the trial court that paragraph (D)(16) of the

property settlement agreement was void because it was based on

the mutual mistake of facts assumed by the parties. The 1987

deed to the marital house clearly provides William Reilly with a

one-third undivided interest. His name appears on the purchase

money loan documents. Additionally, he provided the parties

with a substantial down payment on the purchase price of the

house and paid the closing costs. Despite the glaring evidence

of William's interest in the house, Binhammer's attorney

prepared the property settlement agreement without contacting

William as to his claims against the property and without

seeking to make him a party to the agreement. As drafted and

executed, the property settlement agreement assumed that William

had no financial claim against the home and that Binhammer was

"free to sell the home at her sole discretion." Both

assumptions were impossible to complete without affirmative acts

by William. The evidence clearly shows that William had an

interest in the house and because of that interest, Binhammer

was unable to sell it at her sole discretion. Since the

- 8 - property settlement agreement was based on assumed facts that

did not exist, the trial court did not err in voiding and

severing paragraph (D)(16) on the grounds of mutual mistake of

facts.

B. EQUITABLE ESTOPPEL

Having determined that the trial court did not err in

voiding paragraph (D)(16) in the property settlement agreement

because of mutual mistake of facts, we next consider whether the

trial court erred in failing to estop Daniel from claiming a

greater value for his interest in the family home than that

recited in paragraph (D)(16), particularly the claim of his

father's interest in the property acquired at his father's

death. The doctrine of equitable estoppel provides that a

"party is prevented by his own acts from claiming a right to

[the] detriment of [the] other party who was entitled to rely on

such conduct and has acted accordingly." Blacks Law Dictionary

551 (6th ed. 1990).

The elements necessary to establish equitable estoppel are (1) a representation, (2) reliance, (3) change of position, and (4) detriment, and the party who relies upon estoppel must prove each element by clear, precise, and unequivocal evidence. Dominick v. Vassar, 235 Va. 295, 298, 367 S.E.2d 487, 489 (1988). Because the doctrine of estoppel prevents the showing of the truth, it is applied rarely and only from necessity.

Princess Anne Hills Civic League, Inc. v. Susan Constant Real

Estate Trust, 243 Va. 53, 59, 413 S.E.2d 599, 603 (1992).

- 9 - Binhammer failed to prove the elements of estoppel by clear and

unequivocal evidence.

Binhammer asserts that when Daniel signed the property

settlement agreement he represented that his father had "no

financial claim" against the home, thereby barring his claim to

any ownership interest of his father. Contrary to her

assertions, the record does not support such a contention. To

start, the trial court voided paragraph (D)(16) on which her

contention is based. With paragraph (D)(16) voided and severed

from the property settlement agreement, we must look to the

record for evidence that Daniel had affirmatively represented

that his father did not have an ownership interest in the

marital home and that Binhammer reasonably relied on that

representation. We find no such evidence.

The record before us indicates that Daniel's position has

consistently been that his father loaned the parties the money

to purchase the house and expected repayment should the house be

sold. The record reflects that neither Binhammer nor her

attorney contacted William to verify that he "had no financial

claim against the property." The record also reflects that

Daniel told Binhammer that she should talk with William about

any interest he claimed in the property.

It is inconceivable that Binhammer would rely on the

assumption that her father-in-law possessed no ownership or

financial interest in the marital home when the evidence clearly

- 10 - and overwhelmingly indicates the contrary. William's ownership

interest is reflected in the deed that creates a joint tenancy

with the right of survivorship of a one-third undivided interest

in the house. Furthermore, he provided a substantial down

payment for the property. His name appears on the purchase

money loan documents, and he deducted the interest from the

house payments, even for several years after they were divorced,

in lieu of Daniel and Binhammer making interest payments to him.

Neither Binhammer nor her attorney who drafted the property

settlement agreement contacted William to determine if the

assumptions were correct. Daniel had no authority to relinquish

any ownership interest his father possessed in the property or

the interests of any other third party without their consent.

Any reliance on the assumptions would be per se unreasonable

under the facts of this case.

Failing to prove the threshold elements, we need not

consider the other factors. We hold that the trial court did

not err in finding the evidence insufficient to apply the

doctrine of equitable estoppel.

C. VALUE OF DANIEL REILLY'S INTEREST

Finally we consider whether the trial court erred in

determining the value of Daniel's interest in the marital home,

at the time of his father's death. In the trial court below,

Binhammer requested that the marital home be partitioned and the

interests be valued as follows: (1) William's interest to be

- 11 - valued at zero, and (2) Daniel's one-third interest to be valued

at $2,000, based on the value set in the property settlement

agreement. The trial court refused such a valuation, finding

that Daniel and Binhammer based the disposition of the marital

home on certain assumptions it found to be mutual mistake of

facts. The court severed paragraph (D)(16) of the property

settlement agreement and ordered the property to be partitioned.

It determined from the evidence before it that Daniel owned a

two-thirds undivided interest and Binhammer a one-third

undivided interest.

The 1987 deed to the marital home clearly established that

from the time the home was purchased until his death, William

Reilly possessed a one-third undivided interest. Upon his

death, his will provided that any interest he owned in the

property would pass to Daniel. There is some question as to

whether William's one-third undivided interest passed by devise

under his will or passed in equal shares, to Binhammer and

Daniel, upon his death, as tenants in common by virtue of the

joint survivorship under the grantee clause of the deed. 1

However, the parties failed to preserve or brief that issue for

appellate review. Rule 5A:18. The evidence reflects no

1 See Jones v. Conwell, 227 Va. 176, 181, 314 S.E.2d 61, 64 (1984). Code § 20-111 provides that divorce creates a tenancy in common between former spouses who held the property during the marriage as tenants by the entirety with the right of survivorship as at common law.

- 12 - miscarriage of justice or other good cause justifying an

exception to the operation of Rule 5A:18. Binhammer acquired

the entirety of Daniel's fee simple interest in the property by

deed pursuant to the partition order.

The judgment of the trial court is affirmed. 2

Affirmed.

2 The Court denies Binhammer's request that she be awarded attorney's fees and costs in this appeal. Her continued insistence that William Reilly had no financial claim or ownership interest in the property, despite the clear language of the deed of conveyance, his substantial monetary contribution toward the purchase of the home, and his name being on the loan documents, has resulted in unnecessarily protracted litigation.

- 13 -