Justia Real Estate & Property Law Opinion Summaries

Articles Posted in Kentucky Supreme Court
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In this case, the Supreme Court of Kentucky addressed a dispute over the division of proceeds from the sale of a commercial property. The parties involved were business partners who had formed an LLC to manage the property. One of the partners, Allen, had previously asked his partners to sell their interests in the LLC to his children to resolve a tax problem. The partners agreed, but wanted to ensure they would not forfeit potential future profits from the property sale. They decided that proceeds from a future sale of the building would be split according to their ownership interests up to $8 million, and any proceeds above $8 million would be divided equally among them.In 2017, the property sold for $10 million, and a dispute arose over how to distribute the proceeds. One of the partners, Swyers, distributed the proceeds according to the previously agreed upon formula. However, the Allen family contested this, arguing that the entire proceeds should have been distributed according to ownership interests.The trial court ruled in favor of Swyers, finding that the agreement provided for a bifurcated distribution of proceeds, with an $8 million sale price threshold. The Court of Appeals disagreed, concluding that distributions of one-third each were warranted only if the total net proceeds exceeded $8 million.The Supreme Court of Kentucky reversed the Court of Appeals' decision, agreeing with the trial court's interpretation of the agreement. The court concluded that the parties had intended to split the proceeds on a sale price threshold of $8 million, and that only the sales commission needed to be deducted before calculating the distribution of the final $2 million of the sale price. View "SWYERS V. ALLEN FAMILY PARTNERSHIP #1" on Justia Law

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The Supreme Court reversed the decision of the court of appeals vacating the order of the circuit court granting summary judgment in favor of John and Beth Bruner and against Don and Cathy Cooper in this property dispute, holding that the circuit court did not err in granting Ky. R. Civ. P. 60.02 relief.The Coopers brought this action seeking to have a road that had been maintained by the fiscal court and used by the public and the Bruners, the Coopers' adjoining landowners, The circuit court ultimately concluded that the road was neither a public road nor an easement. Thereafter, the Bruners successfully sought relief from the court's orders regarding the road's classification under Rule 60.02. The circuit court subsequently granted summary judgment for the Bruners, finding that the road was a public road by prescription. The court of appeals vacated the summary judgment order. The Supreme Court reversed and reinstated the grant of summary judgment, holding that the circuit court did not err by granting the Bruners' motion for Rule 60.02 relief or by granting summary judgment in favor of the Bruners. View "Bruner v. Cooper" on Justia Law

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The Supreme Court reversed the opinion of the court of appeals in this case involving the concept of "waste" as it exists in Kentucky law, holding that Ky. Rev. Stat. 381.350 is applicable only in instances in which a party has pled voluntary waste.Under Ky. Rev. Stat. 381.350, a life tenant who commits waste against the corpus of an estate shall "lose the thing wasted and pay treble the amount at which the waste is assessed." At issue was when the statute of limitations began to run in this case, a question that required resolution of the concept of "waste" as it exists in Kentucky law, which required the Supreme Court either to affirmed its longstanding distinction between voluntary and permissive waste or to collapse the two categories into simply "waste." The Supreme Court held (1) long-standing case law continues to be accurate statements of the law of waste as it exists in Kentucky, therefore, section 381.350 continues to apply only to claims of voluntary waste; and (2) the trial court correctly determined that the plaintiff in this case stated claims for voluntary waste. View "Ferrill v. Stock Yard Bank & Trust Co." on Justia Law

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The Supreme Court reversed the judgment of the court of appeals reversing the order of the circuit court granting summary judgment in favor of John and Beth Bruner based on its finding that a disputed road was a public road by prescription, holding that the road was a public road by prescription.Don and Cathy Cooper sought to have the subject road, which had been maintained by the fiscal court and used by the public and the Bruners, adjoining landowners, declared their private driveway. During the litigation, the court of appeals affirmed the circuit court's order finding that the road was not a public road or an easement. The circuit court subsequently granted summary judgment for the Bruners, finding that the road was a public road by prescription. View "Bruner v. Cooper" on Justia Law

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In this appeal concerning the statutory ownership of a vehicle involved in a crash, the Supreme Court affirmed the court of appeals' decision affirming the order of the trial court granting summary judgment in favor of Central Motors, Inc., holding that the circuit court correctly held that Juan Garcia was the statutory owner of the vehicle at the time of the accident.Dolores Zepeda was the passenger in a 2002 BMW being driven by Darley Morales, the son of Juan Garcia, when Morales caused the car to crash in a single vehicle accident. As a result of the accident, Morales died and Zepeda was left paralyzed. Zepeda sued, among other defendants, Garcia for negligent entrustment and Central Motors as the purported statutory owner of the BMW. The trial court granted summary judgment for Central Motors, determining that Garcia, and not Central Motors, was the statutory owner of the vehicle at the time of the accident. The Supreme Court affirmed, holding that Central Motors substantially complied with Ky. Rev. Stat. 186A.220 and delivered possession of the vehicle pursuant to a bona fide sale, thus making Garcia the BMW's statutory owner. View "Zepeda v. Central Motors, Inc." on Justia Law

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The Supreme Court affirmed the decision of the court of appeals affirming the determination of the circuit court that the security agreement between Harvey Haynes, the debtor, covered future advances made by Farmers Tobacco Warehouse (Farmers) so as to have priority over the security interest claimed by Versailles Farm Home and Garden, LLC (Versailles) in Haynes' 2013 tobacco crop, holding that there was no error.In 2014, Versailles brought this action against Haynes to collect on the balance due under the agreement. Versailles joined Farmers as a party to assert its claim against Farmers for conversion to the extent Farmers retained any proceeds in excess of the amount Haynes owed. Farmers admitted selling a portion of Haynes' 2013 tobacco crop and retaining the proceeds but denied doing so in violation of Versailles' security interest. The trial court granted Versailles' motion for summary judgment against Haynes and then granted Farmers' motion for summary judgment as to its cross-claim against Haynes asserting a first and superior lien in Haynes' 2013 tobacco crop. The Supreme Court affirmed, holding that the trial court did not err. View "Versailles Farm Home & Garden, LLC v. Haynes" on Justia Law

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The Supreme Court affirmed the decision of the court of appeals that a real property contract entered into by Henry Gray and William, Mary and Frank Stewart in this case was unenforceable under the statute of frauds but held that this decision did not apply equally to William, Mary and Frank.Henry entered into a real estate contract with Frank, his brother William, and William's wife, Mary. Later, Henry filed a complaint against Frank, William and Mary alleging breach of contract and requesting specific performance and damages. The trial court entered judgment in favor of Henry and awarded $19,286 in damages. The court of appeals reversed in part. The Supreme Court affirmed, holding (1) the contract at issue did not satisfy the statute of frauds; (2) the trial court's findings of fact may not serve as a basis to reverse the court of appeals' decision as to William and Mary; and (3) the court of appeals did not err when it reversed the trial court's damage award. View "Gray v. Stewart" on Justia Law

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The Supreme Court reversed the judgment of the court of appeals reversing the circuit court's grant of summary judgment in favor of homeowners in this complaint brought against them and their attorneys for wrongful use of civil proceedings and abuse of process, holding that the case must be remanded for reinstatement of summary judgment in favor of the homeowners.At issue was the proposed development by Bardstown Capital Corporation of Jefferson County residential property into a commercial center. The proposed development was ultimately approved, despite opposition by neighboring homeowners. The homeowners appealed, arguing that the rezoning ordinance was invalid due to, among other things, inadequacy of notice of the various zoning hearings. After the appeal was denied, Bardstown Capital brought this action against the homeowners. The circuit court granted summary judgment for the homeowners. The court of appeals reversed. The Supreme Court reversed, holding (1) the Noerr-Pennington doctrine afforded the homeowners immunity from claims of wrongful use of civil proceedings; and (2) the trial court properly applied the Doerr-Pennington doctrine and, therefore, did not err in granting summary judgment. View "Seiller Waterman, LLC v. Bardstown Capital Corp." on Justia Law

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The Supreme Court reversed the judgment of the court of appeals affirming the trial court's judgment awarding Borders Self-Storage & Rentals, LLC the sum of $140,000 in this highway condemnation action, holding that the circuit court erred by ruling that the Lawrence County Property Valuation Administrator's (PVA) tax assessment could not be introduced into evidence.At trial, Borders sought to introduce as evidence the assessed tax value of $230,000 reflected in the PVA's records. The circuit court denied the request and ultimately awarded Borders $140,000 as compensation for the condemnation of its real property. The Supreme Court reversed, holding (1) PVA assessments constitute relevant and probative evidence and should not be stricken; and (2) Borders was entitled to a new trial at which it may introduce the PVA's assessed tax value for the condemned lands. View "Borders Self-Storage & Rentals, LLC v. Commonwealth" on Justia Law

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The Supreme Court reversed the decision of the court of appeals reversing the circuit court's order that Defendant forfeit $3,759 in cash that law enforcement officials seized the day Defendant and her co-defendant were arrested, holding that the trial court's forfeiture order was not erroneous.In reversing the forfeiture order, the court of appeals concluded that the Commonwealth failed to establish slight traceability of the funds to drug-trafficking activities. The Supreme Court reversed, holding that the trial court did not clearly err in determining that sufficient facts existed to establish slight traceability of the money to drug activity and raising the presumption of forfeiture, and did abuse its discretion in determining that Defendant failed to rebut the statutory presumption of forfeiture. View "Commonwealth v. Doebler" on Justia Law