KNOCHE v. MORGAN

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Docket Number

No. 82CA0813

Attorney(S)

Harshman, Deister, Larson McBee, Douglas E. Larson, for plaintiff-appellee. Dufford, Waldeck, Ruland, Wise and Milburn, William H.T. Frey, for defendant-appellant.

Judges

Opinion by JUDGE KIRSHBAUM.

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Smart Summary

Factual and Procedural Background

Plaintiff Irene P. Knoche and her husband Richard purchased the subject property as joint tenants on July 20, 1959. Plaintiff filed a homestead declaration on August 5, 1965. On November 21, 1980, Richard executed a general warranty deed purporting to convey a one-half interest in the property to his daughter, defendant Ruth Morgan. Richard died on March 5, 1981. Plaintiff sued to quiet title and to set aside the deed. Defendant asserted abandonment as an affirmative defense, filed a counterclaim seeking reimbursement for costs expended preserving the property, and contended the 1980 deed severed the joint tenancy. Plaintiff moved for summary judgment that the deed was void; defendant cross-moved for summary judgment that the deed severed the joint tenancy. The trial court granted plaintiff's motion, denied defendant's cross-motion, declared the 1980 deed null and void, quieted title in plaintiff, and dismissed defendant's counterclaim. Defendant appealed.

Legal Issues Presented

Whether the 1980 deed executed by one joint tenant of homesteaded property is void under § 38-41-202(4), C.R.S., and thus incapable of severing the joint tenancy.
Whether the trial court properly granted summary judgment for plaintiff on the ground that the deed was void.
Whether the trial court erred in dismissing defendant's counterclaim for reimbursement for expenditures to preserve the property without resolving material issues of fact.

Arguments of the Parties

Plaintiff-Appellee's Arguments

The 1980 warranty deed is void under the predecessor of § 38-41-202 because one joint tenant cannot unilaterally destroy a joint tenancy in properly homesteaded property; therefore summary judgment declaring the deed void and quieting title in plaintiff was appropriate.

Defendant-Appellant's Arguments

Material issues of fact remain, precluding summary judgment.
As a matter of law, the 1980 deed severed the joint tenancy, preventing plaintiff from acquiring title as surviving joint tenant.
The existence of the 1980 deed is sufficient evidence of Richard's intent to sever the joint tenancy.
The trial court erred by dismissing defendant's counterclaim sua sponte for reimbursement of costs expended to preserve the property.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
Wise v. Thomas, 117 Colo. 376, 188 P.2d 444 (1947)	That a deed executed by one of two joint tenants of properly homesteaded property attempting to destroy the joint tenancy by unilateral conveyance is rendered void by statute.	The court applied Wise to hold the 1980 warranty deed void and of no effect as to severing the joint tenancy.
Abrahamsen v. Mountain States Telephone Telegraph, 177 Colo. 422, 494 P.2d 1287 (1972)	Support for granting summary judgment under C.R.C.P. 56 and guidance on summary disposition principles.	The court relied on Abrahamsen to conclude summary judgment was proper on the void-deed issue and later cited it to explain that summary judgment on the counterclaim was improper where material facts remained.
First National Bank v. Energy Fuels Corp., 200 Colo. 540, 618 P.2d 1115 (1980)	Illustrates that, outside homestead contexts, a deed by one joint tenant to a third party may be sufficient evidence of intent to sever the joint tenancy.	The court cited this case as an example of non-homestead precedent but distinguished it, holding the void deed statute controls for homesteaded property.
Walters v. Webster, 52 Colo. 549, 123 P. 952 (1912)	Another example that a deed by a joint tenant may indicate intent to sever joint tenancy in non-homestead situations.	The court referenced Walters but declined to apply its principle because the statute renders deeds affecting homesteaded property void.

Court's Reasoning and Analysis

The court found the material facts undisputed: joint tenancy acquisition in 1959, a homestead declaration in 1965, execution of the 1980 deed by one joint tenant, and the grantor's subsequent death. Applying § 38-41-202(4) as interpreted in Wise v. Thomas, the court concluded the statute renders void any unilateral attempt by one of two joint tenants to destroy a joint tenancy in properly homesteaded property; therefore the 1980 deed was void and could not sever the joint tenancy. Because the facts on that issue were not disputed, the trial court properly granted summary judgment for plaintiff under C.R.C.P. 56 as supported by Abrahamsen. The court rejected defendant's argument that the deed's mere existence was conclusive evidence of intent to sever, reasoning that a void instrument cannot be used as evidence of intent and that allowing such would undermine the homestead act's protective policy. Regarding the counterclaim for reimbursement, the court determined the trial court erred in dismissing it sua sponte: neither party sought summary judgment on the counterclaim, plaintiff did not admit or deny the counterclaim's allegations, the counterclaim was equitable in nature, and unresolved material facts remained; thus summary judgment on the counterclaim was improper and the matter must be remanded for further proceedings.

Holding and Implications

HOLDING: The court affirmed in part and reversed in part. It affirmed the trial court's grant of summary judgment to plaintiff insofar as the 1980 deed was declared null and void and title was quieted in plaintiff. It reversed the dismissal of defendant's counterclaim and remanded for further proceedings on that counterclaim.

Implications: The direct effect is that plaintiff's title is quieted and the 1980 deed is void as to its attempt to sever the joint tenancy in homesteaded property. The defendant's equitable counterclaim for reimbursement survives and must be reconsidered on remand; the opinion does not purport to establish a new rule beyond applying the existing statutory/precedential framework.

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Irene P. Knoche, Plaintiff-Appellee, v. Ruth Morgan, Defendant-Appellant.

Opinion by JUDGE KIRSHBAUM.

In this action to quiet title and to set aside a deed, defendant, Ruth Morgan, appeals the trial court's summary judgment entered in favor of plaintiff, Irene P. Knoche. We affirm in part and reverse in part.

The following material facts are undisputed. On July 20, 1959, plaintiff and her husband, Richard, purchased the property in question as joint tenants. On August 5, 1965, plaintiff filed a homestead declaration pursuant to the predecessor of § 38-41-202, C.R.S. 1973 (1982 Repl. Vol. 16A). On November 21, 1980, Richard Knoche executed a general warranty deed purporting to convey one-half interest in the subject property to defendant, his daughter. On March 5, 1981, Richard died.

In answer to plaintiff's complaint, defendant asserted the affirmative defense of abandonment and filed a counterclaim seeking reimbursement for costs expended for preserving the property. Plaintiff moved for summary judgment on the grounds that the 1980 deed was void. Defendant filed a cross-motion for summary judgment, asserting that the 1980 deed severed the joint tenancy and, therefore, prevented plaintiff from acquiring title to the property as a surviving joint tenant. The trial court granted plaintiff's motion, denied defendant's cross-motion, and dismissed defendant's counterclaim.

Defendant first asserts that material issues of fact remain for resolution and, alternatively, that as a matter of law the 1980 deed severed the joint tenancy between Richard Knoche and plaintiff. We disagree.

The undisputed facts here were sufficient to permit the trial court to rule that the 1980 warranty deed was void and of no effect. Section 38-41-202(4), C.R.S. 1973 (1982 Repl. Vol. 16A), renders void any attempt by one of two joint tenants of properly homesteaded property to destroy the joint tenancy by unilateral conveyance. Wise v. Thomas, 117 Colo. 376, 188 P.2d 444 (1947). The material facts respecting that issue are not disputed. Thus, the trial court properly entered a summary judgment. C.R.C.P. 56; Abrahamsen v. Mountain States Telephone Telegraph, 177 Colo. 422, 494 P.2d 1287 (1972).

Defendant alternatively argues that the very existence of the 1980 deed is sufficient evidence of Richard Knoche's intent to dissolve the joint tenancy to demonstrate conclusively that the joint tenancy was severed. In circumstances not involving homesteaded property, the existence of a deed executed by one joint tenant to a third party may be sufficient evidence, if not rebutted, to establish the severance of the joint tenancy. See, e.g., First National Bank v. Energy Fuels Corp., 200 Colo. 540, 618 P.2d 1115 (1980); Walters v. Webster, 52 Colo. 549, 123 P. 952 (1912). However, the General Assembly has determined that a deed affecting homesteaded property executed by one of two joint tenants is void. Wise v. Thomas, supra. We conclude that the void deed may not be deemed evidence of any intent. Therefore, it may not be utilized to defeat the homestead act's policy of protecting both owners of homesteaded property from disenfranchisement by the unilateral conduct of one joint tenant.

Defendant finally asserts that the trial court erred in dismissing, sua sponte, defendant's counterclaim. We agree.

Neither party requested the trial court to enter a summary judgment on the counterclaim, and plaintiff neither admitted nor denied the allegations that defendant was entitled to contribution for expenditures made by defendant to preserve the property. Thus, the counterclaims are equitable in nature, and the conclusion that defendant has no legal title to the property need not necessarily defeat her claims for reimbursement for sums allegedly expended to preserve the property. Additional questions of material fact must be resolved with regard to the counterclaims; hence, entry of summary judgment on those claims was improper. Abrahamsen v. Mountain States Telephone Telegraph Co., supra.

The judgment is affirmed insofar as it grants summary judgment to plaintiff, declares the 1980 deed null and void, and quiets title in the property in plaintiff. The judgment dismissing defendant's counterclaim asserted by defendant for reasonable costs of preserving the property is reversed, and the cause is remanded for further proceedings on the counterclaim.

JUDGE COYTE and JUDGE STERNBERG concur.