2012 VT 60


Nystrom
and Nystrom v. Hafford
(2011-283)
 
2012 VT 60
 
[Filed 03-Aug-2012]
 
NOTICE:  This opinion is
subject to motions for reargument under V.R.A.P. 40 as well as formal revision
before publication in the Vermont Reports.  Readers are requested to
notify the Reporter of Decisions by email at: JUD.Reporter@state.vt.us or by
mail at: Vermont Supreme Court, 109 State Street, Montpelier, Vermont
05609-0801, of any errors in order that corrections may be made before this
opinion goes to press.
 
 

2012 VT 60

 

No. 2011-283

 

Becky P. Nystrom,
  Scott and Laurie Nystrom


Supreme Court


 


 


 


On Appeal from


     v.


Superior Court, Windham Unit,


 


Civil Division


 


 


Casey J. Hafford


March Term, 2012


 


 


 


 


John
  P. Wesley, J.


 

Robert M. Fisher and Michael McGillion,
Law Clerk (On the Brief) of Fisher & Fisher, 
  Brattleboro, for Plaintiffs-Appellees.
 
Casey J. Hafford,
Pro Se, Townshend, Defendant-Appellant.
 
 
PRESENT:  Reiber, C.J.,
Dooley, Skoglund, Burgess and Robinson, JJ.
 
 
¶ 1.            
ROBINSON, J.   Defendant Casey Hafford
appeals pro se from the trial court’s order granting plaintiff Becky Nystrom’s request to partition jointly owned
property.  Mr. Hafford argues that the court
erred in rejecting his argument that he added Ms. Nystrom’s
name to the deed only in anticipation of marriage, in calculating the parties’
respective interests in the property, in granting Ms. Nystrom’s
request for occupancy, and in declining to award him attorneys’ fees in
connection with Ms. Nystrom’s father’s Prompt Pay Act
claim.  We affirm the trial court’s rulings concerning the partition
itself, but reverse the trial court’s ruling with respect to attorneys’ fees
and remand for reconsideration of Mr. Hafford’s fee
petition pursuant to the Prompt Pay Act.
¶ 2.            
The essential facts, viewed in the light most favorable to the
prevailing party, are as follows.  Mr. Hafford
and Ms. Nystrom were involved in a romantic
relationship between 2002 and 2009.  In 2007, Mr. Hafford
purchased a plot of land with his own money.  In 2009, he executed a
quitclaim deed conveying title to himself and to Ms. Nystrom as joint tenants with rights of survivorship. 
The parties subsequently constructed a home on the property, largely through
the efforts of Ms. Nystrom and her family
members.  When the relationship ended, Ms. Nystrom
filed this action, asking the court to partition the property and determine the value of each party’s share based on his or
her ownership interest and contributions to the property.  
¶ 3.            
Mr. Hafford, who was then represented by
counsel, filed an answer and counterclaim, asserting, among other things, that
he had conveyed a half-interest to Ms. Nystrom only
as a conditional gift in contemplation of a marriage that did not take
place.  Mr. Hafford subsequently moved to join
Scott and Laurie Nystrom, Ms. Nystrom’s
parents, in the action, noting that they had advanced labor, materials, and
money to the parties for the construction of the house and that they may claim
an interest in the property.  Ms. Nystrom did
not object to Mr. Hafford’s motion and, along with
parents, moved to file an amended complaint that added parents as
plaintiffs.  The amended complaint included claims by parents for breach
of contract and unjust enrichment in connection with $32,062 advanced by the
parents to pay for construction costs, and for violation of the Prompt Pay Act
(PPA) in connection with father’s contributions of labor in connection with the
construction project.  The trial court granted the respective motions to
join parents and to add their claims to Ms. Nystrom’s
complaint.  
¶ 4.            
The parties waived the appointment of commissioners and submitted the
matter to the court for resolution.  After a two-day bench trial, the
court issued its order assigning the property to Ms. Nystrom
contingent on her paying Mr. Hafford $67,314 for his
interest.  See 12 V.S.A. § 5174 (allowing for assignment of real estate in
partition action provided that assignee pays other party his or her equitable
share).  At the outset, the court rejected Mr. Hafford’s
assertion that he had transferred the lot into joint names as a gift in
anticipation of marriage, and that his donative
intent was negated by Ms. Nystrom’s alleged
infidelity, which was incompatible with their plans to marry.  The court
noted that the parties had never been engaged, there was no writing establishing
that the transfer was in consideration of an expectancy of marriage, and the
deed was unconditional.  See Brousseau
v. Brousseau, 2007 VT 77, ¶ 12, 182 Vt. 533, 927
A.2d 773 (recognizing general presumption that the voluntary act of titling
property in another’s name creates inference of donative
intent and delivery).  Instead, the court credited Ms. Nystrom’s
testimony that Mr. Hafford had transferred the lot
into joint ownership at her request and based on the expectation that she and
her family members would make substantial contributions of time, money, and
labor in the eventual construction of the home built on the premises.  
¶ 5.            
Based on the largely undisputed evidence, the court found that Ms. Nystrom had contributed $31,524 toward improvements to the
property, and Mr. Hafford contributed $26,700, which
included the lot’s purchase price.  The parties jointly owed $33,048 to
parents for funds that they advanced toward the purchase of construction
materials.  
¶ 6.            
Turning to parents’ claims, the court found that Scott Nystrom, a licensed plumber and skilled practitioner of all
aspects of the building trades, was the de facto construction supervisor for
the home-building project.  The court found that the house was built almost
entirely with volunteer labor and Ms. Nystrom and her
parents supplied the substantial portion of it.  The court did not credit
father’s testimony, however, that he had told Mr. Hafford
that he expected to be paid for his labor in the event that Ms. Nystrom did not occupy the premises.  Accordingly, the
court rejected the father’s PPA claim that was predicated on his labor in
building the house.[1] 

¶ 7.            
The court’s initial decision suggests that it rejected the parents’
direct claims based upon their financial contributions to the construction
project and instead folded those claims into its analysis of Ms. Nystrom’s and Mr. Hafford’s
respective rights.  However, in its ultimate judgment order, the court did
enter a judgment in the parents’ favor in the amount of $33,048, to be treated
as a lien on the subject property.      
¶ 8.            
With respect to the partition, the court found that the equities tipped
in favor of Ms. Nystrom’s request for
occupancy.  It reasoned that Ms. Nystrom’s
greater contributions to the financing, organization, and “sweat equity,” in
the construction process outweighed Mr. Hafford’s
initial acquisition of the land at his sole expense.  Also to Ms. Nystrom’s credit was her capacity to inspire the devotion
of her parents and extended family, without whom the very well-built house
could not have been constructed except by substantial additional expenditures
of money and time.  Additionally, the court found that the presence of so
many members of Ms. Nystrom’s extended family in
locations proximate to the property favored her claim, as did her likely
superior capacity to finance a prompt payment for Mr. Hafford’s
interest, while absorbing the debt to her parents.  
¶ 9.            
The court determined that the fair market value of the property was
$172,500, and the equity to be divided was $139,452 after accounting for the
joint debt to parents of $33,048.  Each party’s share of the equity was
thus $69,726, which the court found must be further adjusted by the difference
in their respective monetary contributions toward the improvements.  Ms. Nystrom had contributed $4824 more than Mr. Hafford; therefore, her obligation to him was reduced by
$2412, leaving the value of Mr. Hafford’s interest at
$67,314.  It thus ordered Ms. Nystrom to pay
this amount to Mr. Hafford upon the assignment of his
interest in the property.  The court did not award attorneys’ fees to
either party.  
¶ 10.         The
court issued a subsequent order in response to a motion to amend and
clarify.  In this order, the court rejected Mr. Hafford’s
claim that he was entitled to attorneys’ fees as the substantially prevailing
party as to the claim brought by father under the PPA.  The court found
that, under all of the circumstances, plaintiffs were arguably the overall
prevailing parties and thus neither party could claim to have substantially
prevailed as to the claim under the PPA.  The court thus upheld its earlier
decision not to award attorneys’ fees.  
¶ 11.         In
reaching its conclusion, the court recognized that parents had chosen to pursue
a PPA claim for labor, forcing Mr. Hafford to defend
against this claim.  Nonetheless, the court concluded that, in general,
the testimony and evidence regarding parents’ claims focused on their overall
contributions of material and labor and thus supported Ms. Nystrom’s
equitable plea for occupancy pursuant to her partition claim.  While the
court did not find that father was entitled to reimbursement for his labor, it
did find parents’ testimony instrumental to Ms. Nystrom’s
claim in partition.  The court also noted that Mr. Hafford’s
separate claim based on lack of donative intent had
occupied a good deal of the evidence and testimony, and this placed him in an
untenable position when claiming to have “substantially prevailed” as to any
aspect of the litigation.  
¶ 12.         On
appeal, Mr. Hafford first argues that the court
should have credited his argument that the property transfer was made in
contemplation of marriage.  See 15 V.S.A. §§ 1001-1002 (while
cause of action for breach of contract to marry has been abolished, party may
have right of action for rescission of deed to real property when the sole
consideration for the transfer was a contemplated civil marriage which has not
occurred).  As reflected above, the court credited Ms. Nystrom’s
conflicting testimony that Mr. Hafford transferred
the property into joint names based on the expectation that Ms. Nystrom and her family would be contributing time and money
to the construction of a home on the property, and concluded that the evidence
did not support Mr. Hafford’s position.  The
trial court is entrusted with the responsibility of weighing the evidence and
assessing the credibility of witnesses.  Cabot v.
Cabot, 166 Vt. 485, 497, 697 A.2d 644, 652 (1997).  Its
findings on this question are supported by sufficient evidence in the record,
and we will not reweigh the evidence on appeal.
¶ 13.         Second,
Mr. Hafford makes several arguments relating to the
court’s calculation of the parties’ respective contributions to the equity in
the property.  He argues that the court should have found that, at the
time of the transfer of the property to the parties jointly, the property was
worth $80,000.  The trial court specifically rejected this argument. 
It found that the evidence offered in support of this claim was unreliable and
speculative.  The court found that the determinative values impacting its
analysis in this case were the purchase price, each
party’s documented expenses, and the present fair market value.  Given
that the house construction was, according to Mr. Hafford’s
own testifying appraiser, thirty-seven percent complete at the time of the
transfer, the trial court did not abuse its discretion in considering Mr. Hafford’s initial investment in the property rather than
its value at the time of transfer in conducting its equitable analysis.  
¶ 14.         Mr. Hafford further challenges the record support for the trial
court’s calculation of the parties’ contributions.  Ms. Nystrom provided evidence to support her claim that she
paid $31,524 in construction expenses; parents testified that their total
advances for materials, less repayments already made, amounted to
$33,048.  The parties stipulated to much of the
evidence underlying these figures.  Accordingly, we conclude that the
trial court’s findings with respect to the parties’ respective contributions were
supported by sufficient evidence in the record, and we will not reweigh the
evidence.
¶ 15.         Mr. Hafford also suggests that the trial court improperly
included an $8000 home equity loan that parents took out to help pay for
construction expenses as part of Ms. Nystrom’s
expenses and as part of the debt to parents.  The record does not
support this claim.  Mother testified that the total amount of outstanding
expenses advanced by parents was $33,048.  The $8000 loan was not itself
an expense but, rather, was the means they used to finance a portion of the
total expenses they claimed and documented.  Parents did “charge” Ms. Nystrom and Mr. Hafford interest
in connection with that $8000, since parents were paying interest on those
funds.  Likewise, Ms. Nystrom’s claimed and
documented contributions to the costs of building the house reflect her actual
expenses.  She did not claim the $8000 parents borrowed to finance some of
the expenses they advanced as part of “her” expenses.  We thus reject Mr. Hafford’s claim that this money should be deducted from Ms.
Nystrom’s contribution, as it was not included in the
first place.  
¶ 16.         In
addition, Mr. Hafford argues that parents should not
be reimbursed for the cost of vinyl siding that has not yet been
installed.  The record shows, however, that at the time of suit the siding
was not installed, but was on site and ready to go on the house.  
¶ 17.         Third,
Mr. Hafford challenges the trial court’s decision to
assign the property to Ms. Nystrom.  The court
identified numerous reasons why it assigned the property to Ms. Nystrom subject to her payment to Mr. Hafford
for his interest.  The court reasonably considered, among other factors,
Ms. Nystrom’s greater contribution to financing,
organizing, and facilitating the construction process, as well as her family’s
quite substantial contributions of labor and money.  Ms. Nystrom also testified that she had been pre-approved for a
loan, and the court did not err in finding that she had a “likely superior
capacity” to finance a prompt payment for Mr. Hafford’s
interest, while absorbing responsibility for the debt to her parents. 
Given this evidence, we cannot conclude that the trial court abused its
discretion in assigning Ms. Nystrom the
property.  See Weed v. Weed, 2008 VT 121, ¶ 16, 185 Vt. 83, 968
A.2d 310 (reviewing equitable remedies for abuse of discretion).  
¶ 18.         Finally,
Mr. Hafford challenges the court’s decision not to
award him attorneys’ fees under the PPA.  See 9 V.S.A. § 4007(c)
(providing that “[n]otwithstanding any contrary
agreement, the substantially prevailing party in any proceeding to recover any
payment within the scope of this chapter [addressing construction contracts]
shall be awarded reasonable attorneys’ fees in an amount to be determined by
the court or arbitrator, together with expenses”).  In his argument on
appeal, Mr. Hafford focuses on the PPA claim itself,
based on a claim for payment for father’s labor; Mr. Hafford
unequivocally prevailed on this claim, as the trial court found no evidence of
any agreement that father would be paid for his labor in the event that Ms. Nystrom did not occupy the house.  
¶ 19.         This
Court has held that, where a common core of facts supports multiple theories of
recovery, including PPA claims and non-PPA claims, “[t]he
lawsuit cannot be viewed as a series of discrete claims.”  Electric
Man, Inc. v. Charos, 2006 VT 16, ¶ 10, 179 Vt.
351, 895 A.2d 193 (quotation omitted).  Accordingly, we concluded that the
trial court in such a case abused its discretion in apportioning a PPA fee
award based on the recovery on each claim.  Id.  As a result,
in most construction cases that include PPA claims, courts typically determine
the substantially prevailing party, if any, and the award of fees with
reference to the broader range of claims at issue in the case rather than
simply focusing exclusively on the PPA claim.  See, e.g., B & F
Land Dev. v. Steinfeld, 2008 VT 109, ¶ 16, 184
Vt. 624, 966 A.2d 127 (where same evidence was central to plaintiff’s claim and
defendant’s PPA counterclaim, trial court properly awarded prevailing defendant
attorneys’ fees that included fees to defend against plaintiff’s claims). 
   
¶ 20.         In
addition, we have recognized that, although an award of attorneys’ fees to the
substantially prevailing party in a PPA case is mandatory, trial courts have
significant discretion in identifying the prevailing party in such cases. 
Fletcher Hill, Inc. v. Crosbie, 2005 VT 1, ¶
12, 178 Vt. 77, 872 A.2d 292.  In affirming an
award of attorneys’ fees under the PPA to a contractor that was ordered to pay
a net judgment to a homeowner, this Court rejected a “net victor” test in favor
of “a more flexible and reasoned approach focused on determining which side
achieved a comparative victory on the issues actually litigated or the greater
award proportionally to what was actually sought.”  Burton v. Jeremiah
Beach Parker Restoration & Const. Mgmt. Corp., 2010 VT 55, ¶ 8, 188 Vt.
583, 6 A.3d 38 (quotations omitted).
¶ 21.         Notwithstanding
the flexible standard this Court has endorsed, we conclude that the trial
court’s order in this case exceeds its discretion.  PPA claims typically
arise in construction disputes in which one party seeks to be paid for its work
and the other party seeks to avoid paying on the ground that the work was
deficient.  In such cases, the commonality of facts underlying the PPA
claim and related claims and defenses sounding in contract, unjust enrichment,
consumer fraud, or other such causes of action, is apparent.  See Electric
Man, 2006 VT 16, ¶ 10 (applying “common core of facts” analysis where “[v]irtually all of the evidence is relevant to all of the
claims” (quotation omitted)).  This case falls outside of that
paradigm.  That is, this case is not a typical construction dispute in
which a court cannot reasonably determine the substantially prevailing party
with respect to the PPA claim without taking into account the panoply of other
claims on the table.
¶ 22.         Father’s
PPA claim is predicated solely on his labor in constructing the house on the
property subject to this partition action.  The subjects of the remaining
claims among the parties were: (1) whether the property was transferred into
joint names (Mr. Hafford’s and Ms. Nystrom’s) in contemplation of marriage without an intent
to transfer a property interest to Ms. Nystrom
independent of that expectation; (2) the extent of Mr. Hafford’s
and Ms. Nystrom’s respective contributions to, and
equitable interests in, the property; (3) the balance of the equities between
Mr. Hafford and Ms. Nystrom
with respect to assignment of the property; and (4) parents’ entitlement to
reimbursement for their financial contributions to the construction,
independent of their contributions of labor that formed the basis for the PPA
claim.[2] 
These various claims do not spring from a core of facts in common with with father’s PPA claim, which focused solely on his claim
for compensation for the time and labor he contributed to the building project,[3] and the evidence underlying these claims
is largely distinct from the evidence offered to prove and rebut father’s PPA
claim.  
¶ 23.         The
only other issue in the case with respect to which the evidence and argument
relating to father’s labor was relevant was Ms. Nystrom’s
request that she be assigned the property in the partition action; in
evaluating the PPA issue, the trial court emphasized that the testimony and
evidence regarding the contributions of material and labor by the parents was
instrumental to Ms. Nystrom’s equitable plea for
occupancy in the partition action.  But by crediting parents in
connection with their PPA claim for reimbursement for father’s labor with Ms.
Nystrom’s “win” on her equitable claim to
occupancy, the trial court treated parents and Ms. Nystrom
as essentially one party.  Although the personal and emotional alignment
of parents and child in this case is obvious, their legal interests were not so
overlapping as to warrant treating them as the same party.  While we can
imagine multi-party cases in which two or more parties share such a commonality
of legal and financial interests that the victory of one party on a claim or
set of claims involving a common core of facts may be imputed to another for
the purposes of determining who is the prevailing party for PPA purposes, in
this case the legal and financial interests of the parents and their daughter
are not so aligned.  
¶ 24.         We do
not mean to suggest that, in a more typical construction dispute, trial courts
must parse PPA and non-PPA claims in identifying the substantially prevailing
party in connection with the PPA claim, or in calculating a fee award.  We
reaffirm our prior holding that a fee award should not be apportioned
among claims that arise from a common core of facts.  Electric
Man, 2006 VT 16, ¶ 10.  However, as a threshold matter, trial
courts must consider and determine which claims do, in fact, arise from a
common core of facts insofar as the evidence relevant to those claims is the
same.  Id. ¶¶ 10, 17.
¶ 25.         On
remand, the trial court should make a reasonable effort to award Mr. Hafford legal fees associated with father’s PPA claim for
reimbursement for labor in connection with the construction project, as well as
any other claims by father resting on the same core set of facts.[4]  See Monahan v. GMAC Mortg. Corp., 179 Vt. 167, 199, 893 A.2d 298,
324 (2005) (determining attorneys’ fees attributable to specific claims is
a question of fact for the trial court).
Affirmed in part,
reversed in part, and remanded for further proceedings.
 
 

 


 


FOR THE COURT:


 


 


 


 


 


 


 


 


 


 


 


Associate
  Justice

 





[1] 
The trial court describes the PPA claim as a claim of both parents, and in
their respective briefs, both parties likewise characterize the claim. 
Although captioned in the complaint as a claim of “Scott & Laurie Nystrom,” the PPA claim itself was a claim for
reimbursement solely for father’s labor.  For that reason, we describe the
PPA claim as father’s claim, rather than as parents’ claim.


[2] 
Parents pled both unjust enrichment and breach of contract with respect to their
financial contributions to the project; the gravamen of both claims was that
parents were entitled to reimbursement for their financial contributions.
 


[3] 
Father cited his contributions of labor as the basis for his PPA claim and as a
basis for parents’ unjust enrichment claim.  To the extent that father
sought a remedy by way of unjust enrichment for his labor contributions,
he lost on that claim as well.


[4] 
For example, father pled a count entitled “conditional gift” that was
predicated on his contributions of labor to the construction project.



