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CCC, Inc. v. J Class Collision, LLC

Supreme Court of West Virginia

February 15, 2019

CCC, Inc., a West Virginia Corporation, Defendant Below, Petitioner,
J Class Collision, LLC, a West Virginia limited liability company, Plaintiff Below, Respondent

          Kanawha County 15-C-2159


         Petitioner CCC, Inc., by counsel L. Richard Dorsey II, appeals the Circuit Court of Kanawha County's June 26, 2017, order ruling on a "Petition for Interpleader." Respondent J Class Collision, LLC, by counsel O. Gay Elmore Jr., filed a response in support of the circuit court's order. Petitioner filed a reply. On appeal, petitioner argues that the circuit court erred in denying its claim for rent from the period of January of 2017 through April of 2017 because it constituted additional sanctions without an award of the same.[1]

         This Court has considered the parties' briefs and the record on appeal. The facts and legal arguments are adequately presented, and the decisional process would not be significantly aided by oral argument. Upon consideration of the standard of review, the briefs, and the record presented, the Court finds no substantial question of law and no prejudicial error. For these reasons, a memorandum decision affirming the circuit court's order is appropriate under Rule 21 of the Rules of Appellate Procedure.

         In June of 2013, petitioner and respondent entered into a lease agreement whereby petitioner leased a commercial building located in Dunbar, West Virginia, to respondent. According to the lease agreement, petitioner gave respondent an "absolute" right to the "Option to Purchase" the subject property. During the course of the lease agreement, respondent expressed the intent to exercise the purchase option "on numerous occasions." Ultimately, around the summer of 2015, petitioner agreed to sell the property at issue, at which point respondent was approved for financing to complete the purchase. However, petitioner "refuse[d] to sell the Subject Property to [respondent] citing negative tax ramifications." As a result of petitioner's refusal to abide by the purchase option in the lease agreement, respondent filed a complaint seeking to compel petitioner to sell it the subject property in December of 2015. Petitioner then filed an answer and counterclaim asserting, among other things, that it was entitled to unpaid rent from respondent.

         Following a bench trial, the circuit court entered an order on July 11, 2016, in which it ruled that petitioner "shall abide by the terms of the Lease Agreement herein, and execute a deed to [respondent] thereby consummating the sale of the subject property." However, by order entered on December 1, 2016, the circuit court granted petitioner's motion to amend the judgment to include a ruling on petitioner's counterclaim for unpaid rent. In that order, the circuit court found that

[t]he remaining issues [petitioner] raised in its Motion to Amend are moot based on [petitioner's] representations at the hearing that it will close on the real estate transaction pursuant to the lease agreement, assuming that the rental payments are brought current. The transaction shall be closed by December 31, 2016.

         The circuit court further "ORDERED that conditional upon payment of such amount, [petitioner] shall consummate the sale of the real property at issue in this case to [respondent], pursuant to the terms of the Lease Agreement, by December 31, 2016." It is undisputed that respondent paid petitioner the full amount of money for unpaid rent that the circuit court awarded.

         On January 17, 2017, due to petitioner's failure to consummate the sale of the subject property, respondent filed a motion to enforce the circuit court's prior order and for attorney's fees and costs. Additionally, a third-party, Gravely Tractor and Lawn Equipment, Inc. ("Gravely"), filed a motion to intervene in the proceedings.

         In February of 2017, the circuit court held a hearing on the outstanding motions. Turning first to the motion to intervene, Gravely informed the circuit court that it did not seek to intervene in order to force the sale at issue, but rather to address issues concerning certain property rights that petitioner was ordered to convey to respondent and the effect such conveyance would have on its own property rights. Ultimately, the circuit court found that Gravely's motion to intervene was untimely, given that the matter had previously been resolved by a bench trial, and denied the same. Turning to respondent's motion, the circuit court found that petitioner "failed to comply with the December 1, 2016[, ] Order" and therefore granted the motion to enforce that order and to award respondent attorney's fees and costs in the amount of $4, 783. Further, pursuant to Rule 70 of the West Virginia Rules of Civil Procedure, the circuit court "execute[d] a Deed on behalf of [petitioner] conveying the subject property to [respondent] for the agreed upon consideration" as set forth in the lease agreement. The circuit court's order was entered on March 3, 2017.

         On March 8, 2017, petitioner filed a motion to amend the circuit court's findings or make additional findings of fact, or, alternatively, for a new trial or evidentiary hearing on the issue of the form of the deed. By order entered on March 17, 2017, the circuit court denied petitioner's motion without holding a hearing. As set forth above, petitioner failed to appeal from any of these orders ruling on the transfer of the property at issue.

         On April 21, 2017, Stephen L. Thompson, the escrow agent handling the closing on the subject property, filed a "Petition for Interpleader" seeking a ruling on the distribution of funds held. On June 15, 2017, the circuit court held a hearing upon the "Petition for Interpleader." During the hearing, petitioner raised issues with funds held in escrow for payments under the lease from January of 2017 through closing, which the record indicates did not take place "until April of 2017 . . . ." Because of the delay in closing, petitioner argued that it was entitled to lease payments for the additional time that respondent still had the benefit of the property. Respondent, however, "argued that [petitioner] should not benefit from its wrongful action and refusal to comply" with the circuit court's prior orders. Ultimately, the circuit court ruled that petitioner "shall not be entitled to any of the funds held by this Court for unpaid rents" and that the funds the circuit court held as of the date of the hearing were "to be paid unto Real Corp, LLC, care of Stephen L. Thompson . . . ." It is from the circuit court's June 26, 2017, order ruling on the interpleader petition that petitioner appeals.

         This Court has previously established the following standard of review:

"In reviewing challenges to the findings and conclusions of the circuit court made after a bench trial, a two-pronged deferential standard of review is applied. The final order and the ultimate disposition are reviewed under an abuse of discretion standard, and the circuit court's underlying factual findings are reviewed under a clearly erroneous standard. Questions of law are subject to a de novo review." Syllabus Point 1, Public Citizen, Inc. v. First National Bank in Fairmont, 198 W.Va. 329, 480 S.E.2d 538 (1996).

Syl. Pt. 1, Valentine & Kebartas, Inc. v. Lenahan, 239 W.Va. 416, 801 S.E.2d 431 (2017). On appeal, petitioner argues that in denying its request for rent payments for the period of January of 2017 through April of 2017, the circuit court "levied additional sanctions against [petitioner]" for the same issues that it previously awarded sanctions in its March 3, 2017, order. We note, however, that petitioner's ...

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