Quinn v. Sharon Corp.

540 S.E.2d 474, 343 S.C. 411, 2000 S.C. App. LEXIS 179

• Court: Court of Appeals of South Carolina
• Decided: November 27, 2000
• Docket: 3262
• Status: Published

Opinions

HUFF, Judge:

Joseph Lee Quinn brought an action against the Sharon Corporation, his daughter, Sharon Quinn, and Sharon’s husband, Dennis Baker, seeking affirmation of his ownership of all of the issued and outstanding stock of the Corporation, damages, attorney’s fees and court costs against Sharon and Baker, and judgment of $272,330.82 on a promissory note. From an order granting the Corporation, Sharon, and Baker summary judgment, Joseph appeals.¹ We affirm.

STANDARD OF REVIEW

Summary judgment is appropriate when it is clear there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Wilson v. Moseley, 327 S.C. 144, 488 S.E.2d 862 (1997). In ruling on a motion for summary judgment, the evidence and all inferences which can be reasonably drawn therefrom must be viewed in the light most favorable to the non-moving party. Id.

FACTUAL/PROCEDURAL BACKGROUND

Viewing the record in the light most favorable to Joseph, the record reveals the following facts. In August, 1976, Joseph organized the Corporation, to which he conveyed most or all of his land and wealth. All of the 10,000 issued and outstanding shares of the Corporation were issued to Joseph. In accordance with his estate plan, Joseph transferred his shares of the Corporation to Sharon. Sharon was elected to all offices of the corporation at one time or another. Joseph stated in an affidavit that he explained to Sharon that he would remain the sole owner of the Corporation and she would have no interest in the Corporation until his death.

Until 1986, Joseph kept all the certificates of shares in his bank safety deposit box, to which Sharon had access. In 1986, Sharon removed the certificates from the safety deposit box. Joseph filed a lis pendens to prevent Sharon from conveying any of the corporation’s property. As a result of the dispute with her father, Sharon endorsed the shares in blank. Joseph stated he then returned the shares to his safety deposit box. In either 1990 or 1991, Joseph delivered the certificates to the Corporation’s accountant in order to keep them with the corporate records. After a medical scare in 1996, Joseph informed Sharon of the location of the certificates and Sharon retrieved them from the accountant. Joseph instructed Sharon to put the certificates back in his safety deposit box, but she failed to do so. In October of 1996, Joseph attempted to terminate the employment of Sharon’s husband, Dennis Baker. Thereafter, Sharon assumed control over the Corporation. Joseph filed the present action on November 19,1996.

LAW/ANALYSIS

Joseph argues the trial court erred in granting the Respondents summary judgment on his claims. We disagree.

The supreme court expressly adopted the doctrine of judicial estoppel, as it relates to matters of fact, in the case of Hayne Federal Credit Union v. Bailey, 327 S.C. 242, 489 S.E.2d 472 (1997). The doctrine precludes a party from adopting a position in conflict with one previously taken in the same or related litigation. Id. The purpose of the doctrine is not to protect litigants from allegedly improper or deceitful conduct by their adversaries, but to protect the integrity of the judicial process and the courts. Id. The supreme court explained,

In order for the judicial process to function properly, litigants must approach it in a truthful manner. Although parties may vigorously assert their version of the facts, they may not misrepresent those facts in order to gain advantage in the process. The doctrine thus punishes those who take the truth-seeking function of the system lightly. When a party has formally asserted a certain version of the facts in litigation, he cannot later change those facts when the initial version no longer suits him.

Id. at 251-52, 489 S.E.2d at 477.

In Hayne, the appellant contended he owned certain property by virtue of a resulting trust. The appellant had, in a previous divorce action, claimed he had no legal interest in the property and that the property was owned by his son. The court held, because the father had previously claimed his son owned the property, he was judicially estopped from later claiming ownership of the property.

In the instant case, the record shows Joseph had previously filed an answer and counterclaim dated March 16, 1992 in the case of Charles H. Smith v. Joe L. Quinn and The Sharon Corporation, Case No. 92-CP-23-304. There, Joseph admitted that Sharon owned and operated the Corporation and stated he had no authority to bind the Corporation. Similarly, in a hearing held June 16, 1992 in the case of State of South Carolina v. Joe Quinn, Case No. 91-GS-23-7358, 7359, Joseph testified Sharon owned the Corporation. He denied owning any real estate, stocks, bonds, notes, or other valuable property.

Joseph’s claim in the present action that he is the sole owner of the Corporation is in direct contravention to his assertions in the prior litigations. Were we to allow Joseph to change his position as to the facts and now claim ownership of the Corporation, “the truth-seeking function of the judicial process [would be] undermined.” Hayne, 327 S.C. at 252, 489 S.E.2d at 477. We therefore hold Joseph’s claim for ownership of the Corporation is barred by the doctrine of judicial estoppel.²

For the foregoing reasons, the order granting respondents summary judgment is

AFFIRMED.

GOOLSBY, J., concurs. ANDERSON, J., concurring in result only in a separate opinion.

1 . Joseph does not challenge the trial court's holding that his action on the promissory note is barred by the statute of limitations.

2 . Although not ruled upon by the trial court, respondents’ brief contains argument that appellant is judicially estopped from asserting he, and not his daughter, is the owner of all outstanding stock of the Corporation. See Rule 220(c), SCACR ("The appellate court may affirm any ruling, order, or judgment upon any ground(s) appearing in the Record on Appeal”); I'On, L.L.C. v. Town of Mt. Pleasant, 338 S.C. 406, 526 S.E.2d 716 (2000) (It is not always necessary for a respondent to present his issues and arguments to the lower court and obtain a ruling on them in order to preserve an issue for appellate review. The appellate court may review respondent’s additional reasons and, if convinced it is proper and fair to do so, rely on them or any other reason appearing in the record to affirm the lower court’s judgment.).