Millerberg v. Steadman

645 P.2d 602, 1982 Utah LEXIS 919

• Court: Utah Supreme Court
• Decided: March 16, 1982
• Docket: No. 17308
• Status: Published

Opinions

STEWART, Justice:

This is an appeal from an order of the district court specifically enforcing a settlement agreement between the parties. The action in the trial court was to divide the assets of a family corporation, the J. H. Allen Corporation. The assets of the corporation consist of a large ranch, including buildings, wells, equipment, other personal property, 15,000 acres of fee land, and 15,-000 acres of leased land. Dorothy Miller-berg and Nelda Steadman, daughters of J. H. Allen, each inherited 50% of the J. H. Allen Corporation. After they and their families fell into irreconcilable differences as to how the ranch should be managed, the Millerbergs filed this action for an involuntary dissolution of the corporation pursuant to Utah Code Ann., 1953, § 16-10-92, and a partition of the assets in kind.

The parties entered into a settlement agreement at a pre-trial conference. Pursuant to the agreement, the Millerbergs were to divide all the assets of the corporation into two “packages,” and the Stead-mans were to have the first choice as to which “package” they would elect to receive. The parties were also to cooperate in obtaining a tax-free division of the assets of the corporation pursuant to Section 355 of the Internal Revenue Code. As agreed, the Millerbergs divided the assets into two packages, but the Steadmans refused to make a choice.

On an order to show cause, the trial court held that the Millerbergs had fully complied with the settlement agreement and that the Steadmans had breached the agreement by failing to make a selection. The trial court ordered the Steadmans to select one of the two packages within ten days or forfeit their choice to the Millerbergs. The Stead-mans refused, and the Millerbergs then made their choice. The Steadmans also refused to sign a request for an IRS revenue ruling, despite a court order directing them to do so.

On appeal, the Steadmans contend that the trial court erred in ordering them to make a selection, and in allowing the Mil-lerbergs to make a selection after Stead-mans’ refusal to do so. Steadmans claim that they could not make a choice because the division of the property was not equitable, there was a failure to provide sufficient specificity for such matters as necessary access easements and rights-of-way, and the packages provided for joint and common use of certain assets rather than complete separation. Steadmans further contend that it was error to require them to execute the request for a Revenue Ruling because there was a misstatement of facts contained in the application.

There was no ambiguity in the agreement for one party to divide the assets and the other to select first. Given the size of the property and the necessity to provide access to water and various easements, it was, perhaps, inevitable that there would be some unresolved problems in any division. The division clearly did not resolve all possible disputes. The unresolved details, which are now urged by Steadmans to justify their refusal to comply with the agreement, affect both parties. If and when those details give rise to disputes, they will be in the context of specific circumstances, and the court should be better able to deal with them. In any event, the unresolved issues that exist are not sufficient to preclude enforcement of the stipulated agreement, and the Steadmans, who had first choice in the selection and refused to exercise that choice, cannot now claim that the division was basically unfair.

The settlement agreement in this case was entered into in the presence of the trial court. There is no claim of fraud or imposition. The unresolved issues now relied on were, for the most part, not presented to the trial judge as an obstacle to the performance of the agreement. Under the circumstances of this case, and the reasons presented by the appellants to the trial judge to excuse their non-performance, the trial judge acted within the ambit of necessary discretion in summarily enforcing the settlement agreement. See Robinson v. State Department of Natural Resources, Utah, 620 P.2d 519 (1980); Tracy Collins Bank & Trust Co. v. Travelstead, Utah, 592 P.2d 605 (1979).

We have no doubt that the district court, upon a proper showing, would permit any necessary amendment to the request for an IRS ruling if necessary to avoid a misstatement of fact.

Affirmed. Costs to respondents.

HALL, C. J., OAKS, J., and JAMES S. SAW AYA, District Judge, concur.