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Steuerer v. Richards

Supreme Court of Idaho

October 2, 2013

Donald E. STEUERER, Plaintiff-Respondent,
v.
N.E.M. RICHARDS, a.k.a. Nicky Richards, Defendant-Appellant.

Page 293

The Simms Law Firm, Hailey, for appellant. Christopher P. Simms argued.

Williams, Meservy & Lothspeich, LLP, Jerome, for respondent. Robert E. Williams argued.

J. JONES, Justice.

This is an appeal from a judgment holding that two deeds executed by Donald Steuerer in favor of N.E.M. Richards were not intended as absolute conveyances, but instead were intended as mortgages to secure loans made by Richards to Steuerer.

I.

FACTUAL AND PROCEDURAL BACKGROUND

Steuerer purchased two lots in the City of Shoshone (the Property) in December of 1987 for $3,000. In 1990, Steuerer took up residence on the Property and became acquainted with Richards, who lived across the street. Richards " suffers from various physical and mental disabilities and had been treated for such disabilities at the VA Hospital since approximately 1998. These disabilities have an impact on her ability to recall and organize her thoughts." Between 1990 and 1997 Steuerer and Richards would visit each other from time to time.

In 1997, Steuerer was in need of funds and asked Richards to loan him some money. Richards agreed to loan Steuerer $5,000. Richards made an initial payment of $400 to Steuerer on February 25, 1997. On February 26, Steuerer executed and recorded a warranty deed conveying a half interest in the Property to Richards. Richards paid additional funds for the benefit of Steuerer on May 8, 2000, and Steuerer contemporaneously executed a quitclaim deed to the Property in favor of Richards. The parties later disputed (1) how much Richards had paid to or for the benefit of Steuerer and (2) whether the deeds were intended as absolute conveyances or whether these were lending transactions whereby the deeds were intended to be mortgages to secure repayment of the loans.

Steuerer filed suit against Richards in September of 2010, seeking to quiet title to the Property. He alleged that the deeds were intended as mortgages rather than absolute conveyances. Richards claimed that the deeds were absolute conveyances and that she therefore owns the Property. The matter was tried in July of 2011. On September 8, 2011, the district court issued its Judgment, holding that: (1) the deeds executed by Steuerer to the Property were intended by the parties to be mortgages to secure loans made by Richards to Steuerer; (2) Steuerer must pay to Richards $9,285.11 plus prejudgment interest of $7,395.88; and (3) upon payment of the monetary award, Richards must re-convey the Property to Steuerer. Richards appealed to this Court.

On appeal, Richards states that she " does not argue the findings of fact are clearly erroneous, but instead argues the District Court's conclusions of law are not sustained by the facts found." Therefore, the following findings are extracted from the district court's decision.

7. It appears from the testimony of Richards and Steuerer that their recollections of the events are not necessarily reliable, as to the amounts loaned and when....

Page 294

The court further finds that in February 1997 Richards agreed to loan $5,000.00 to Steuerer and that Richards would pay the money to Steuerer in monthly payments. Based on the evidence, the court can only find that the amount paid by Richards to Steuerer over six (6) months totaled $2,500.00.... The court finds that of the $5,000.00, Richards paid $2,500.00 to Steuerer.
8. [T]he first payment by Richards to Steuerer was on February 25, 1997. A Warranty Deed dated February 24, 1997 was prepared, whereby Steuerer conveyed to Richards a one-half interest in the subject property. The deed was notarized and recorded on February 26, 1997. The deed was signed by both Steuerer and Richards. Steuerer testified that the purpose of the deed was to be collateral for the $5,000 loan from Richards. Richards testified in her deposition that the purpose of the deed " was to have some kind of collateral."
9. Both parties were of the expectation and agreement that the amounts paid to Steuerer by Richards would be repaid by Steuerer and, upon repayment, Richards would re-convey her interest in the subject property to Steuerer. The parties did not agree as to a definite time for repayment, other than to agree that Steuerer would repay the monies as soon as possible or when he could. Richards, prior to the filing of this lawsuit, has never made a demand for repayment. There was no agreement as to any interest to be paid and it was not a topic of discussion in the original agreement.
10. Prior to June 20, 2011, the last time that Steuerer personally paid any real property taxes on the subject property was on April 2, 1997, in the amount of $201.58. This was for the 1994 property taxes, which were delinquent and the payment was inclusive of the tax, interest, and penalties owed to Lincoln County. In May 2000, Steuerer was delinquent in the payment of his property taxes on the subject property for the prior years of 1995 to 1999. Richards brought the property taxes current by her payments to Lincoln County dated May 8, 2000 and December 20, 2000.
11. On May 8, 2000, the same day that Richards paid part of the delinquent property taxes on the subject property, Steuerer executed a Quitclaim Deed to the subject property, wherein he conveyed his remaining interest in the subject property to Richards. The deed was notarized and recorded on May 8, 2000. As with the Warranty Deed, the Quitclaim Deed was signed by both Steuerer and Richards. The testimony of Steuerer and Richards is again in conflict as to the reason for the quitclaim deed; however, what is clear is that it was executed contemporaneously with Richards' agreement to pay the property taxes on the subject property. Richards testified that the purpose of the quitclaim deed was the same as the warranty deed, as collateral or " something to assure me that he was going to pay me back."

II.

ISSUES ON REVIEW


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