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HomeMy WebLinkAbout00-6968 CIVILJULIANNE WANDELL, Plaintiff Vo : IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW KIMBERLEY A. CLARK,: Defendant NO. 00-6968 CIVIL TERM IN RE: ADJUDICATION BEFORE OLER, J. OPINION and DECREE NISI OLER, J., January 3, 2002. In this difficult partition action, the parties are the owners of a timeshare estate in a resort condominium in Carbon County, Pennsylvania, and a piece of real property in Cumberland County, Pennsylvania. By agreement of the parties, the court entered an order directing partition of these items of property "in proportion to [the parties'] respective interests."~ A preliminary conference pursuant to Pennsylvania Rule of Civil Procedure 1558 was held on August 1, 2001.2 The order resulting from the preliminary conference scheduled a final hearing for October 11, 2001, and stated, in pertinent part, as follows: The issues in the case for determination by the Court are (a) the proper percentages of contribution to the value of the parties' real property and time-share asset to be attributable to the ~ Order of Court, June 22, 2001. : In pertinent part, Rule 1558 provides as follows: (a) The court, after the entry of the order directing partition, shall direct the parties or their attorneys to appear for a preliminary conference to consider (1) whether the parties can agree upon a plan of partition or sale; (2) the simplification of the issues; (3) whether any issues or matters relating to the carrying out of the order of partition shall be referred to a master; and (4) such other matters as may aid in the disposition of the action. Pa. R.C.P. 1558(a). parties, and (b) the listing price for the sale of the realty. The parties are in agreement that the realty should be sold to a third party or to one of the parties, via a listing agreement, for the best price obtainable, and that the time-share should also be placed on the market and sold for the best price obtainable.3 Based upon the evidence presented at the hearing, a decree nisi will be entered disposing of the issues presented.4 STATEMENT OF FACTS Plaintiff is Julianne Wandell, an adult individual residing at 365 Petersburg Road, Carlisle, Cumberland County, Pennsylvania.5 Defendant is Kimberly Clark, an adult individual residing at 147 East North Street, Carlisle, Cumberland County, Pennsylvania. 6 The parties became acquainted at their place of employment,7 and in 1985 Defendant moved in with Plaintiff at Plaintiff's residence at 365 Petersburg Road in Carlisle.8 The parties apparently separated in December of 1999.9 Timeshare estate. At some point, the parties purchased a timeshare estate together,l° On November 3, 1997, they traded in this timeshare and purchased a new timeshare estate together. ~ ~ 3 Order of Court, August 3,2001. 4 The decree to be entered by the court, while permitting sale to a party through the device of a listing agreement, will also permit purchase by a party through a private sale in accordance with the Pennsylvania Rules of Civil Procedure applicable to partitions. Should the parties desire to forgo the advantages of a private sale, the decree will authorize their deviation from the terms of the decree by mutual agreement. 5 N.T. 60, Hearing, August 1, 2001 (hereinafter N.T. ~. 6 N.T. 99. 7 N.T. 60. 8 N.T. 60; see N.T. 75. 9N.T. 60, 94, 97-98. l0 N.T. 60. This timeshare estate was apparently at a place in the Pocono Mountains called the Carriage House. N.T. 102. ~ N.T. 60; Defendant's Exhibit 4, Hearing, August 1, 2001 (hereinafter Plaintiff's/Defendant's Exhibit __). The precise type of cotenancy which the parties assumed does not appear to be expressed in the documents relating to the purchase. 2 The new timeshare estate consisted of an annual one-week period in a two- bedroom condominium unit in a resort in the Poconos known as Westwood at Split Rock, in Lake Harmony, Carbon County, Pennsylvania.12 The price of the timeshare estate was about $10,000.00, with the paperwork showing a purchase price of $8,360.19 and the balance being attributable to (an unstated) credit for the trade-in.13 The current fair market value of the asset remains at $10,000.00.TM At settlement, Defendant paid $2,763.26, which comprised a payment on the purchase price of $2,508.06 and a payment for closing costs, including recording fees, real estate transfer tax, and document preparation charges.15 The balance of the purchase price, in the amount of $5,852.13, was financed.16 Both parties were obligors on the promissory note evidencing the debt.17 With respect to payments of principal on the timeshare note, initially each paid half of the periodic payments on the note;la however, commencing in September, 1999, Defendant alone began making the periodic payments on this obligation.19 Payments made jointly by the parties reduced the principal on the loan by approximately $1,186.53; payments made solely by Defendant reduced the principal further by $1,605.49.20 Thus, Plaintiff should be credited with a $593.27 payment on principal, and Defendant should be credited with a $2,198.76 payment on principal. ~: N.T. 60-65; Defendant's Exhibit 4. ~s N.T. 61-62; Defendant's Exhibit 4. 14 Evidence at the hearing did not lead the court to conclude that the value of this asset had either increased or declined since its purchase by the parties. ~5 Defendant's Exhibit 4. 16 N.T. 62; Defendant's Exhibit 4. ~v N.T. 62; Defendant's Exhibit 4. 18 N.T. 62-63. 19 N.T. 74-75. :0 These calculations have been made on the basis of an amortization schedule applicable to a debt in the principal amount indicated, with interest at the annual rate of 10.99 percent. See Defendant's Exhibit 4. 3 The effect of the foregoing is that Plaintiff has contributed 20% to the value of the parties' interest in the timeshare estate and Defendant has contributed 80% to the value.2~ Prior to the dissolution of their friendship, the parties used the timeshare estate together.22 However, in 2000 and 2001, Defendant enjoyed the benefit of the estate without Plaintiff.23 The fair rental value of the timeshare does not appear of record. This asset is not capable of division, without prejudice to or spoiling the whole, into purparts under Pennsylvania Rule of Civil Procedure 1560. Nor is it the court's understanding that the parties are requesting that such a division be attempted. Realty. On March 24, 1999, the parties purchased a 1.179-acre tract of land containing a residence as joint tenants with right of survivorship in Penn Township, Cumberland County, Pennsylvania, for $53,000.00.24 The address of the property was 8 Cornman Road, Carlisle, Pennsylvania.25 The parties' intention was to eventually replace the existing residence on this property with a new home and move from Plaintiff's house to the new residence.26 The current fair market value of the property is $51,500.00.27 :~ This calculation takes into account the equal contribution of the parties from the trade-in, as well as the monetary contributions of each. :: N.T. 64. :3 N.T. 64. :4 Plaintiff's Exhibit 2; Defendant's Exhibit 1. :5 Plaintiff's Exhibit 2. :6 N.T. 67. :v Plaintiff's Exhibit 1. In arriving at this figure, the court found persuasive the testimony and report of Plaintiff's expert, Victor Piro, considered in conjunction with the price paid by the parties for the property, with residence, about two years before. Defendant's experts separately valued the land at $25,500.00 and the residence at $6,800.00, for a total of $32,300.00. Defendant's Exhibits 1-2. 4 In purchasing the property, the parties borrowed $24,000.00 from an institutional mortgagee.28 Apparently, both parties were obligors on the note evidencing this debt.29 In addition, (a) Defendant provided $1,000.00 as a down payment,3° (b) Plaintiff's mother advanced $14,000.00 in the form of an undocumented loan to Plaintiff for the settlement, (c) Defendant contributed $13,000.00 for the settlement, and (d) Plaintiff contributed $1,461.30 for the settlement.3~ With respect to payments of principal on the mortgage note, initially each party paid half of the periodic payments on the note.32 However, commencing in September of 1999, Plaintiff alone began making the periodic payments on this obligation.33 Presently, the principal on the mortgage obligation has been reduced by $2,580.70, from $24,000.00 to $21,419.30.34 Unfortunately, not all of the terms of the note associated with the mortgage appear of record,35 and it is not possible to utilize an amortization schedule to calculate precisely how much of the reduction in principal should be attributed to each party's payments. Based upon the available evidence, a reduction in principal in the amount of $1,262.90 will be attributed to the parties' joint payments, and $1,317.80 will be attributed to :8 Plaintiff's Exhibit 2. :9 See Defendant's Exhibit 5. As of September 5, 2001, the payoff on this obligation was $21,419.30. Id. 3o See Plaintiff's Exhibit 2; N.T. 88. 3~ N.T. 69, 89. Defendant's $13,000.00 contribution came in part from bonds which she cashed in; Plaintiff's $1,461.30 was apparently a portion of a $3,000.00 gift from her mother to her. N.T. 69-73, 89. Unfortunately, the figures testified to in this case do not match the amount collected from the borrowers at settlement as shown on the settlement sheet, and the court has reconciled them to the best of its ability in its capacity as trier of fact. 32 N.T. 99-100. 33 N.T. 75, 99-100. 34 Defendant's Exhibit 5. 35 Specifically, the interest rate and term of the loan do not appear of record. 5 Plaintiff's sole payments.36 Thus, Plaintiff should be credited with a $1,949.25 payment on principal, and Defendant should be credited with a $631.45 payment on principal. With respect to the loan from Plaintiff's mother, both parties seem to have felt at least a moral obligation to repay it.37 Thus, the parties jointly repaid $400.00 shortly after settlement to Plaintiff's mother,38 in September of 1999 Defendant paid an additional $8,600.00 on the debt,39 and Plaintiff has paid an additional $2,000.00 on the debt.4° Plaintiff still owes $3,000.00 on the debt.4~ The effect of the foregoing is that Plaintiff has contributed 27% to the value of the parties' interest in the property,42 and Defendant has contributed 73% to the value. The parties moved into the residence on the property in September of 1999.43 Plaintiff moved out of the residence in December of 1999.44 Defendant moved out of the residence in April of 2000.45 The fair rental value of the property does not appear of record. The property is presently vacant.46 36 This computation is based on a ratio developed from the periods of such payments applied to the total reduction in principal. 37 N.T. 70-71. 38 N.T. 70-71. 39 N.T. 70-71, 74-75. Plaintiff's mother had, by this time, effectively assigned her rights with respect to collection of $8,600.00 of the debt to her own mother (Plaintiff's grandmother). N.T. 71. Defendant thus paid the $8,600.00 to the assignee, Plaintiff's grandmother. Id. 4o N.T. 4~ N.T. 42 This 43 N.T. 44N.T' 45 N.T. 46 N.T. 73. This $2,000.00 was paid to Plaintiff's mother. Id. 73. percentage includes the $3,000.00 which Plaintiff owes to her grandmother. 97. 97. 97. 98. 6 Each party helped with maintenance and repairs in connection with the property.47 Defendant's father and uncle also provided assistance in the form of labor.48 The extent, if any, to which the value of the property was affected by the maintenance and repairs was not established by the evidence, in the view of the court, nor were these items shown to have been of a type properly describable as 49 permanent and necessary to the preservation of the property. This asset is not capable of division, without prejudice to or spoiling the whole, into purparts under Pennsylvania Rule of Civil Procedure 1560. Nor is it the court's understanding that the parties are requesting that such a division be attempted. DISCUSSION "Partition is a proceeding to divide land among co-owners, so that each may enjoy his or her share in severalty or the equivalent." 5 Goodrich-Amram 2d § 1551:1(1990). "The primary purpose of proceedings for the partition of real estate is to enable each owner to possess and control his or her own share of the estate exclusively, that is, to divide the estate among the several owners in order to prevent strife and disagreement between them." Id. In general, procedure in partition actions is governed by the rules pertaining to equity. Pa. R.C.P. 1551. Under the Pennsylvania Rules of Civil Procedure, in a partition action "property not capable of division without prejudice to or spoiling the whole shall be offered for private sale confined to the parties." Pa. R.C.P. 1563(a). Where a sale is not confined to the parties, it "shall be conducted in such manner and upon such terms as the court shall direct .... Pa. R.C.P. 1572(a). The required contents of an adjudication and decree in a partition action are set forth in Pennsylvania Rule of Civil Procedure 1570. In an ascertainment of the respective interests of the parties in a partition action, "adjustment for taxes is 47 N.T. 75-86. 48 N.T. 77-78. 49 As previously noted, the property is presently worth less than the parties paid for it. 7 permissible only where the obligation for contribution can be found through agreement of the parties or if the defense of voluntary payment can be otherwise overcome." 5 Goodrich-Amram 2d §1570(a):8. In addition, a prerequisite to an award of credit for expenditures for maintenance and repairs is that they be in the nature of "permanent improvements.., necessary to the preservation of the common property ...."5 Goodrich-Amram 2d § 1570(a):9. Based upon the foregoing findings of fact and principles of law, the following decree nisi is entered: DECREE NISI AND NOW, this 3rd day of January, 2002, upon consideration of Plaintiff's amended complaint in the above-captioned matter, and the court having previously ordered partition of two assets of the parties described hereafter, and following a hearing held on October 11, 2001, it is ordered, adjudged and decreed, for the reasons stated in the accompanying opinion, as follows: 1. Within 21 days of the date of a final decree, at a private sale, that party who is ready, willing and able to purchase the parties' timeshare estate at Westwood at Split Rock in Lake Harmony, Pennsylvania, shall be permitted to do so, provided that (a) the purchase price shall be based on a fair market value of the asset of no less than $10,000.00, (b) the other party is not ready, willing and able to purchase the asset on the basis of an equal or greater fair market value, (c) the legal liability of the other party on the debt which accompanied the purchase is extinguished, and (d) the parties receive the benefit of their equity in the asset in accordance with the percentages of contribution attributed to them in the accompanying opinion, the nonpurchaser to receive her benefit in cash. 2. In the event that neither party elects to purchase the asset at a private sale, the asset shall be put on the market by the parties, provided that (a) the asking price shall be $10,000.00, (b) if the asking price is not met within three months the asset shall be sold for the best offer received within the next month, and (c) the proceeds of the sale shall be divided between the parties in accordance with the percentages of contribution attributed to them in the accompanying opinion. 3. Within 21 days of the date of a final decree, at a private sale, that party who is ready, willing and able to purchase the parties' property at 8 Cornman Road, Carlisle, Pennsylvania, shall be permitted to do so, provided that (a) the purchase price shall be based on a fair market value $51,500.00, (b) the other party is not ready, willing and able to purchase the asset on the basis of an equal or greater fair market value, (c) the legal liability of the other party on the debt which accompanied the purchase is extinguished, and (d) the parties receive the benefit of their equity in the asset in accordance with the percentages of contribution attributed to them in the accompanying opinion, the nonpurchaser to receive her benefit in cash. 4. In the event that neither party elects to purchase the asset at a private sale, the asset shall be put on the market by the parties, provided that (a) the listing price shall be $51,500.00, (b) if the listing price is not met within three months the property shall be sold for the best offer received within the following month, and (c) the proceeds of the sale shall be divided between the parties in accordance with the percentages of contribution attributed to them in the accompanying opinion. 5. Notwithstanding the foregoing, each party shall also be credited with reductions in principal on the aforesaid debts 9 which are attributable to payments made by her since the hearing in this case on October 11,2001. 6. Nothing herein is intended to preclude the parties from deviating from the terms of this decree by mutual agreement. 7. All other relief requested by either party is denied. 8. This decree nisi shall automatically become a final decree without further order of court in the absence of a timely motion for post-trial relief pursuant to Pennsylvania Rule of Civil Procedure 227.1. BY THE COURT, J. Wesley Oler, Jr. J. Wesley Oler, Jr., J. Peter J. Russo, Esq. 5010 E. Trindle Road Suite 200 Mechanicsburg, PA 17055 Attorney for Plaintiff Maxine Kay Lewis, Esq. 1101 North Front Street Harrisburg, PA 17102 Attorney for Defendant 10 11 JULIANNE WANDELL, Plaintiff Vo : IN THE COURT OF COMMON PLEAS OF CUMBERLAND COUNTY, PENNSYLVANIA CIVIL ACTION - LAW KIMBERLEY A. CLARK,: Defendant NO. 00-6968 CIVIL TERM IN RE: ADJUDICATION BEFORE OLER, J. DECREE NISI AND NOW, this 3rd day of January, 2002, upon consideration of Plaintiff's amended complaint in the above-captioned matter, and the court having previously ordered partition of two assets of the parties described hereafter, and following a hearing held on October 11, 2001, it is ordered, adjudged and decreed, for the reasons stated in the accompanying opinion, as follows: 1. Within 21 days of the date of a final decree, at a private sale, that party who is ready, willing and able to purchase the parties' timeshare estate at Westwood at Split Rock in Lake Harmony, Pennsylvania, shall be permitted to do so, provided that (a) the purchase price shall be based on a fair market value of the asset of no less than $10,000.00, (b) the other party is not ready, willing and able to purchase the asset on the basis of an equal or greater fair market value, (c) the legal liability of the other party on the debt which accompanied the purchase is extinguished, and (d) the parties receive the benefit of their equity in the asset in accordance with the percentages of contribution attributed to them in the accompanying opinion, the nonpurchaser to receive her benefit in cash. 2. In the event that neither party elects to purchase the asset at a private sale, the asset shall be put on the market by the parties, provided that (a) the asking price shall be $10,000.00, (b) if the asking price is not met within three months the asset shall be sold for the best offer received within the next month, and (c) the proceeds of the sale shall be divided between the parties in accordance with the percentages of contribution attributed to them in the accompanying opinion. 3. Within 21 days of the date of a final decree, at a private sale, that party who is ready, willing and able to purchase the parties' property at 8 Cornman Road, Carlisle, Pennsylvania, shall be permitted to do so, provided that (a) the purchase price shall be based on a fair market value $51,500.00, (b) the other party is not ready, willing and able to purchase the asset on the basis of an equal or greater fair market value, (c) the legal liability of the other party on the debt which accompanied the purchase is extinguished, and (d) the parties receive the benefit of their equity in the asset in accordance with the percentages of contribution attributed to them in the accompanying opinion, the nonpurchaser to receive her benefit in cash. 4. In the event that neither party elects to purchase the asset at a private sale, the asset shall be put on the market by the parties, provided that (a) the listing price shall be $51,500.00, (b) if the listing price is not met within three months the property shall be sold for the best offer received within the following month, and (c) the proceeds of the sale shall be divided between the parties in accordance with the percentages of contribution attributed to them in the accompanying opinion. 5. Notwithstanding the foregoing, each party shall also be credited with reductions in principal on the aforesaid debts which are attributable to payments made by her since the hearing in this case on October 11,2001. 6. Nothing herein is intended to preclude the parties from deviating from the terms of this decree by mutual agreement. 7. All other relief requested by either party is denied. 8. This decree nisi shall automatically become a final decree without further order of court in the absence of a timely motion for post-trial relief pursuant to Pennsylvania Rule of Civil Procedure 227.1. BY THE COURT, J. Wesley Oler, Jr., J. Peter J. Russo, Esq. 5010 E. Trindle Road Suite 200 Mechanicsburg, PA 17055 Attorney for Plaintiff Maxine Kay Lewis, Esq. 1101 North Front Street Harrisburg, PA 17102 Attorney for Defendant