Opinion
14-P-1679
12-01-2015
WASHINGTON MUTUAL BANK v. AMERICAN HOME MORTGAGE SERVICING, INC. & another.
NOTICE: Summary decisions issued by the Appeals Court pursuant to its rule 1:28, as amended by 73 Mass. App. Ct. 1001 (2009), are primarily directed to the parties and, therefore, may not fully address the facts of the case or the panel's decisional rationale. Moreover, such decisions are not circulated to the entire court and, therefore, represent only the views of the panel that decided the case. A summary decision pursuant to rule 1:28 issued after February 25, 2008, may be cited for its persuasive value but, because of the limitations noted above, not as binding precedent. See Chace v. Curran, 71 Mass. App. Ct. 258, 260 n.4 (2008).
MEMORANDUM AND ORDER PURSUANT TO RULE 1:28
Kathleen M. Whitenett appeals from a judgment of the Land Court finding the purported conveyances of property to Joan Raymond, Whitenett's mother and purported grantor, and subsequent conveyance to Whitenett null, void, and of no effect. On appeal, Whitenett claims the judge erred by unjustly enriching Time Financial, LLC, and argues for an alternative remedy based on an equitable estoppel theory. We affirm.
Time Financial, LLC, sold the property in question to Raymond, the decedent and initial purchaser, who then transferred the interest to her daughter, Whitenett. Raymond, through an invalid power of attorney, purchased the property using loans from American Brokers Conduit, who then assigned the mortgage to U.S. Bank, the successor trustee of Washington Mutual Bank (Washington Mutual).
A valid conveyance of real property requires that the grantor deliver and grantee accept title to the property. See Hawkes v. Pike, 105 Mass. 560, 562 (1870). Neither occurred in this instance because the recipient was dead when she allegedly accepted and then transferred the deed. See Frankowich v. Szczuka, 321 Mass. 75, 77 (1947) (delivery requires "the grantor intend the deed to effect a present transfer of the property and that the grantee by his conduct assent to the conveyance"). Whether an effective delivery occurred is a question of fact for the judge. See ibid. Here, the judge permissively determined that, because Raymond was ignorant of the transaction and never intended to accept a conveyance, the deed was ineffective. Because record evidence supports this finding, we do not disturb it. See Demoulas v. Demoulas Super Mkts., 424 Mass. 501, 510 (1997), quoting from T.L. Edwards, Inc. v. Fields, 371 Mass. 895, 896 (1976) ("[W]e do not 'review questions of fact found by the judge, where such findings are supported on any reasonable view of the evidence, including all rational inferences of which it was susceptible'").
The judge credited aspects of Whitenett's testimony explaining that Raymond died on March 31, 2006, and was under hospice care in the weeks preceding her death. Although the transfer occurred under a power of attorney and the date on the deed indicated that the conveyance occurred when Raymond was still alive, neither fact supports the validity of the purported delivery. First, the power of attorney is invalid because it was not signed by Raymond. Even if the signature were valid, the transaction would still be null and void, because the power of attorney would have terminated on Raymond's death. See Brown v. Cushman, 173 Mass. 368, 372-373 (1899). Second, the date written on the deed, here a date which predates Raymond's death, is not conclusive proof of the actual date of delivery. See Graves v. Hutchinson, 39 Mass. App. Ct. 634, 640 (1996) (presumption that date of delivery is the date listed on the deed may be overcome by "evidence of extrinsic facts or circumstances"). The judge permissibly found that the purported delivery never occurred, because despite the date listed on the deed, the closing attorney held the deed in escrow until after Raymond's death on April 3, 2006. Most importantly, none of the evidence or testimony at trial suggested Raymond had any knowledge of or took part in the purported conveyance, thereby preventing her from effectively accepting the deed from Time Financial or transferring it to Whitenett.
On appeal, Whitenett requests that we vacate the judgment and enforce the mortgage based on equitable principles in order to avoid unjustly enriching Time Financial. In support of her claim, she argues that creating a constructive trust where Whitenett remains on the property and Washington Mutual continues to hold the mortgage would prevent this unjust enrichment. We disagree. As noted, the judge correctly ruled that the mortgage and related purported conveyances are null and void. Regardless of the date on the conveyance itself, the initial buyer, whether in hospice care or deceased for the relevant time period, could not properly take part in a valid conveyance.
Refusing the constructive trust Whitenett seeks would not deprive her or Raymond of property to which either was otherwise lawfully entitled, because neither possessed any valid rights to the property. See Frankowich, supra at 77. Although a court may impose a constructive trust to prevent unjust enrichment, such a remedy is unnecessary and inapplicable here. See Maffei v. Roman Catholic Archbishop, 449 Mass. 235, 246-247 (2007). Any potential unjust enrichment claim against Time Financial for receiving funds related to the sale of the property in question is a claim for U.S. Bank, not Whitenett to pursue. It does not serve the interests of justice and equity to transfer property to a person without valid title in order to ensure that Time Financial does not profit from its incidental participation in Whitenett's fraudulent scheme.
Regardless, Whitenett here is not entitled to equitable relief because she does not have "clean hands." The unclean hands doctrine denies equitable relief to "one tainted with inequitableness or bad faith relative to the matter in which [s]he seeks relief . . ." Fidelity Mgmt & Research Co. v. Ostrander, 40 Mass. App. Ct. 195, 200 (1996), quoting from United States v. Perez-Torres, 15 F.3d 403, 407 (5th Cir. 1994). While the judge did not believe Whitenett planned this scheme or acted as the "moving force" behind it, the judge found that the evidence suggested that Whitenett was hardly an "innocent bystander." Because Whitenett appreciably participated in perpetuating this multi-level fraud, she will discover that the so-called "doors of equity" are closed. Ibid.
In particular, the judge found that Whitenett forged Raymond's signature on both the deed granting her title to the property as well as Raymond's signature on the power of attorney.
Claiming that Whitenett's appeal is a frivolous ruse to allow her to continue living at the foreclosed property without paying rent, Washington Mutual argues it is entitled to double damages and costs in defending the appeal under Mass.R.A.P. 25, as appearing in 376 Mass. 949 (1979). We disagree. Although we affirm the judgment, "[u]npersuasive arguments do not necessarily render an appeal frivolous." Avery v. Steele, 414 Mass. 450, 455 (1993). Whether an appeal warrants sanctions is left to our discretion and such sanctions are generally disfavored except in the most egregious cases. See id. at 455-456. Whitenett's appeal here presented a question "worthy of appellate consideration" and therefore does not justify awarding single or double attorney fees and costs. Hodge v. Klug, 33 Mass. App. Ct. 746, 758 (1992).
Judgment affirmed.
By the Court (Berry, Meade & Maldonado, JJ.),
The panelists are listed in order of seniority. --------
/s/
Clerk Entered: December 1, 2015.