Harman v. 105 Partners

2024 UT App 109, 556 P.3d 669
CourtCourt of Appeals of Utah
DecidedAugust 1, 2024
Docket20220076-CA
StatusPublished
Cited by3 cases

This text of 2024 UT App 109 (Harman v. 105 Partners) is published on Counsel Stack Legal Research, covering Court of Appeals of Utah primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harman v. 105 Partners, 2024 UT App 109, 556 P.3d 669 (Utah Ct. App. 2024).

Opinion

2024 UT App 109

THE UTAH COURT OF APPEALS

DAVID R. HARMAN, Appellant, v. 105 PARTNERS, LLC; ANTHONY M. THURBER; BREKKE R. FELT; AND LORRAINE THURBER, Appellees.

Opinion No. 20220076-CA Filed August 1, 2024

Fourth District Court, Provo Department The Honorable Robert A. Lund No. 210400689

J. Spencer Ball, Attorney for Appellant D. David Lambert and Richard A. Roberts, Attorneys for Appellees Anthony M. Thurber, Brekke R. Felt, and Lorraine Thurber Richard D. Flint and Angelica M. Juarez, Attorneys for Appellee 105 Partners, LLC

JUDGE RYAN D. TENNEY authored this Opinion, in which JUDGES MICHELE M. CHRISTIANSEN FORSTER and RYAN M. HARRIS concurred.

TENNEY, Judge:

¶1 The dispute before us involves two competing real estate developers (David Harman and 105 Partners, LLC, respectively) each of whom signed an agreement to purchase the same property Harman v. 105 Partners

from the same seller. 1 Through a set of circumstances set forth below, 105 Partners ended up with title to the Property. After this occurred, Harman sued both 105 Partners and the seller (Trust Defendants), raising a number of claims for relief. 2 The district court later dismissed all of Harman’s claims, and it also awarded attorney fees to both 105 Partners and the Trust Defendants based on its conclusion that they had prevailed in the suit.

¶2 Harman now appeals both the dismissal of his suit and the award of attorney fees. For the reasons set forth below, we first reject the assertions of 105 Partners and the Trust Defendants that Harman’s claims have become moot by recent events. Turning to the merits, we affirm the district court’s dismissal of some, but not all, of the claims. We accordingly reverse in part, vacate the award of fees, and remand for further proceedings consistent with this opinion.

1. As discussed below, this appeal turns in some measure on a potential differentiation between one purchaser’s attempt to purchase the land, the buildings on the land, or both. For simplicity, we’ll refer to the land and the buildings collectively as the Property, differentiating between them as needed, and we’ll likewise capitalize the word “property” in any quotation from the record that refers to the land and buildings in question.

2. Before the contested sale, the Property was owned by the Anthony Fernlund & Lorraine Thurber Trust (the Trust). In the suit at issue, Harman sued Anthony M. Thurber and Brekke R. Felt (who were the trustees of the Trust) and Lorraine Thurber (who was its beneficiary). For convenience, we’ll refer to them collectively as the Trust Defendants.

20220076-CA 2 2024 UT App 109 Harman v. 105 Partners

BACKGROUND

105 Partners and Harman Both Sign Contracts to Purchase the Property 3

¶3 The Property is comprised of two adjacent parcels of land in downtown Provo, Utah. In 2014, 105 Partners sought to obtain the Property so that 105 Partners could develop it. In August of that year, the Trust Defendants and 105 Partners signed an agreement that was titled “Contribution Agreement.” Under its terms, the Trust Defendants and 105 Partners created a partnership under which the Trust Defendants would convey the Property to 105 Partners in exchange for some shares of interest in 105 Partners. The Contribution Agreement specified that title to the Property would be conveyed to 105 Partners after 105 Partners received approval from Provo City for a project plan and after 105 Partners acquired another nearby property. These conditions were not immediately fulfilled, however, so title to the Property was not conveyed at that time.

¶4 In 2015, the Trust Defendants and 105 Partners amended the Contribution Agreement, adding provisions under which the Trust Defendants would convey title to the Property to 105 Partners within 30 days. The parties made further amendments in 2017 that memorialized, among other things, an additional capital contribution from Cobble Way Holdings, LLC (Cobble Way), which was a “substantial partner” in the development plans for the Property. Despite the terms of the 2015 amendment, the Trust

3. The facts set forth in this subsection of the Background are drawn from Harman’s complaint. See Lewis v. U.S. Bank Trust NA, 2020 UT App 55, n.1, 463 P.3d 694 (“On appeal from a motion to dismiss, we review the facts only as they are alleged in the complaint. We accept the factual allegations as true and draw all reasonable inferences from those facts in a light most favorable to the plaintiff.” (quotation simplified)).

20220076-CA 3 2024 UT App 109 Harman v. 105 Partners

Defendants did not convey title to the Property to 105 Partners in 2015, nor did they do so in 2017. And 105 Partners “never took any ancillary steps to obtain the conveyance of [the Property], including filing for record with the Utah County Recorder any instrument identifying the [Contribution Agreement], paying any of the taxes or expenses of [the Property], or taking any other action in furtherance of instigating the conveyance.”

¶5 In January 2020, Cobble Way communicated with 105 Partners about potentially dissolving the project because it had “not progressed, leaving the various contributed land parcels encumbered for over five years,” and Cobble Way and its owner also expressed the view that the “existing additional equity contribution requirement expired in August 2018, leaving no possibility of [105 Partners] obtaining a construction loan.” Further, Provo City had not approved the development project, and “the time period in which city approval could be given” had allegedly passed.

¶6 In August 2020, Harman entered the picture and offered to purchase the Property from the Trust Defendants for $500,000. The Trust Defendants accepted Harman’s offer, and Harman and the Trust Defendants each signed a Real Estate Purchase Contract (the REPC). Under a heading labeled “Offer to Purchase,” the REPC listed “Property (General Description): small commercial buildings located on” the address for the Property, which it then listed in a separate line. An attached Notice of Interest and Exhibit identified the underlying plats of land as well. Under the REPC, Harman was required to pay the purchase price of $500,000 by August 10, 2021.

¶7 After learning about the REPC, 105 Partners sued the Trust Defendants, seeking enforcement of the Contribution Agreement (including its subsequent amendments). Harman filed a motion to intervene in that lawsuit. On May 14, 2021, however, and before the court could rule on Harman’s motion to intervene, the Trust

20220076-CA 4 2024 UT App 109 Harman v. 105 Partners

Defendants and 105 Partners reached a settlement, and 105 Partners’ suit was voluntarily dismissed with prejudice. Under the settlement terms, the Trust Defendants agreed to convey title to the Property to 105 Partners in exchange for $375,000, and the parties soon executed that agreement. 4

This Lawsuit

¶8 Because Harman knew about the settlement agreement between the Trust Defendants and 105 Partners, Harman never tendered the $500,000 purchase price required by the REPC. Instead, on May 21, 2021, Harman filed the suit that’s at issue in this appeal. In this suit, Harman named both 105 Partners and the Trust Defendants as defendants. 5 And in conjunction with this suit, Harman filed a lis pendens against the Property.

¶9 In the Complaint, Harman alleged seven causes of action. For analytical reasons, we’ll discuss them in two groups.

¶10 In what we’ll call the Partnership Claims (comprised of Claims I through IV), Harman sought to invalidate the partnership that had been created between 105 Partners and the Trust Defendants, and he likewise sought to invalidate the

4. It’s a touch unclear from the record when title was actually conveyed.

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Cite This Page — Counsel Stack

Bluebook (online)
2024 UT App 109, 556 P.3d 669, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harman-v-105-partners-utahctapp-2024.