Siclari v. Siclari

Termont Superior Court
Filed 09/20/2
Addison U Ttnit

VERMONT SUPERIOR COURT CIVIL DIVISION
Addison Unit Case No. 242-11-19 Ancv
7
Mahady Court
Middlebury VT 05753
802-388-7741
www.vermontjudiciary.org

Siclari et al vs. Siclari

DECISION ON CROSS-MOTIONS FOR SUMMARY JUDGMENT

This property dispute includes claims of breach of express trust, breach of resulting
trust, breach of constructive trust, unjust enrichment, wrongful possession of property,

trespass to chattel, and negligence for damage to personal property. Defendant Stephanie
Siclari moves for summary judgment on all claims except those related to personal

property. Plaintiffs Donald Siclari and Fudosan Kongo-Ji Temple, Inc. ("the Temple'')
cross-move for summary judgment on the constructive trust claim.
Facts
The following facts are undisputed unless otherwise noted. Defendant purchased
the property located at 149 Purinton Road, Lincoln, Vermont ("the property") on August

17, 2012. She financed the purchase through raa HUD loan from Union Bank. The
property was purchased in Defendant's name because she could get a more favorable
interest rate than if Plaintiff Donald Siclari had purchased it, and because she could get a

better interest rate than the Temple, which did not yet have 501(c)(3) status.

At the time of the property purchase in 2012, the Temple was incorporated, but it
had not yet filed for 501(c)(3) status, and did not obtain such status until 2015. Plaintiffs

assert, and Defendant denies, that Defendant was involved with the Temple as a voting
member.

Donald Siclari signed two "gift letters" shortly before the property purchase in

August 2012. The letters refer to gift payments of $20,000 and $80,000 to be applied to the

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purchase of the property. The letters refer to Donald Siclari as the “donor” and provide
the following in pertinent part:

(3) No repayment of the gift is expected or implied in the form
of cash or by future services of the recipient.

(4) The funds given to the homebuyer were not made available
to the donor from any person or entity with an interest in the
sale of that property including the seller, real estate agent or
broker, builder, loan officer, or any entity associated with them.

Exh. 8. The letters also contain the following warning: “Our signatures above indicate that
we fully understand that it is a Federal Crime punishable by fine, imprisonment, or both to
knowingly make any false statement concerning any of the above facts as applicable under
the provision of Title 18, United States Code, Section 1012 and 1014.” Id.
Although Donald Siclari alleges that he and Defendant agreed that Stephanie was to
transfer the property to the Temple after the purchase, there is no signed, written
agreement between Plaintiffs and Defendant for the transfer of the property to Plaintiffs.
The transfer did not take place because, among other reasons, the Temple had not yet
applied to be a 501(c)(3) entity. Plaintiffs allege that the property was to be transferred
when the Temple was in a position to hold the property and Donald Siclari was ready to
make the transfer. In 2015 when the Temple attained 501(c)(3) status, Plaintiffs did not
take steps toward the transfer.
Donald Siclari, a priest and president of the Temple, donated money to the Temple,
resulting in lower personal taxes for himself. From the time of the purchase of the
property until October 2020, money that Defendant paid toward property expenditures
such as the mortgage and taxes was reimbursed to her from the Temple’s account.
Plaintiffs had full, unlimited use of the property until July 2020, although there was no oral
or written property rental agreement between Plaintiffs and Defendant.
The Temple paid for renovations to the property, including kitchen and bath
upgrades, religious features, a studio/shed, and landscaping. There was no agreement
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between Plaintiffs and Defendant for Defendant to reimburse the Temple for renovations
to the property. The parties dispute the amount the Temple paid for the renovations as
well as whether the improvements resulted in an increase in value.

Discussion

To succeed on a motion for summary judgment, the moving party must demonstrate
that there is no genuine dispute regarding any material fact and that it is entitled to
judgment as a matter of law. V.R.C.P. 56(a). “When both parties move for summary
judgment, each is entitled to the benefit of all reasonable doubts and inferences when the
opposing party’s motion is being judged.” In re Beliveau NOV, 2013 VT 41, ¶ 7, 194 Vt. 1
(quoting City of Burlington v. Fairpoint Commc’ns, Inc., 2009 VT 59, ¶ 5, 186 Vt. 332). The
parties agree that no material facts are in dispute.
Defendant first argues that based on the undisputed facts, there is no resulting trust
creating Plaintiffs’ alleged legal interest in the property. It is a principle of equity that when
one person purchases real property with his own money and takes the deed in the name of
another, “a trust results, by operation of law, to the person paying the consideration.”
Gregoire v. Gregoire, 2009 VT 87, ¶ 15, 186 Vt. 322 (quoting Pinney v. Fellows, 15 Vt. 525, 538
(1843)). The elements of a resulting trust are “the payment of consideration and the
parties’ intent at the time of the conveyance.” Tokarski v. Gates, 138 Vt. 220, 222. It is
undisputed that the consideration in question came from Donald Siclari, who also signed
documentation indicating that the money was a gift with no expected repayment. The
purpose of the gift letter was to make a representation to the lender that Defendant would
not owe any repayment of the gift. Defendant argues that the unlawful use of the gift
letters to induce the HUD loan (with favorable terms for Defendant as borrower), see 18
U.S.C. § 1012, precludes relief in equity for Donald Siclari. See Shattuck v. Peck, 2013 VT 1,
¶ 14, 193 Vt. 123 (“[O]ne who seeks relief in equity must come to the court with clean
hands.”) (quoting Savage v. Walker, 2009 VT 8, ¶ 10, 185 Vt. 603 (mem.)). “The same
principle applies when the object of the conveyance is not to defraud a private creditor but

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to mislead the government.” Id. (citing In re Estate of Bruner, 338 F.3d 1172, 1177 (10th
Cir.2003)) (“Under the maxim, [h]e who comes into equity must come with clean hands, a
court ... will not lend its aid ... to one who has been a participant in a transaction the
purpose of which was to defraud a third person, to defraud creditors, or to defraud the
government.”).
However, regardless of whether Donald Siclari acted with unclean hands when he
executed the gift letters, and even if the Court credited Plaintiffs’ assertion that the parties’
plan was always that Defendant would transfer the property to the Temple, there is no
disputed or undisputed fact that supports a conclusion that the parties’ intent at the time of
purchase was for Donald Siclari to benefit from a resulting trust. There are also no
undisputed or disputed facts that the Temple paid the consideration. Therefore, as a
matter of law, Defendant is entitled to summary judgment on the resulting trust claim.
Constructive trust is also an equitable remedy:
A court may impose a constructive trust when a party obtains
some benefit that they cannot, in good conscience, retain. “It is a
familiar principle of equity that a trust is implied whenever the
circumstances are such, that the person taking the legal estate,
whether by fraud or otherwise, cannot enjoy the beneficial
interest without violating the rules of honesty and fair dealing.”
Legault [v. Legault], 142 Vt. [525,] 529 . . . [(1983)] (quotations and
citations omitted). Courts may employ constructive trusts to
avoid unconscionable results and to prevent unjust enrichment.
Preston v. Chabot, 138 Vt. 170, 174–75 . . . (1980).

Weed v. Weed, 2008 VT 121, ¶ 17, 185 Vt. 83. Here, again, Defendant argues that Donald
Siclari acted with unclean hands and is therefore not eligible to seek relief in equity.
Plaintiffs contend that the Court must examine all the facts in detail to make a
determination about the circumstances related to unclean hands. However, Plaintiffs do
not lay out sufficient factual assertions to show that Donald Siclari’s unclean hands remain
a disputed issue. It is undisputed that he executed the gift letters that attest that he
expected no repayment or service on the recipient’s part, yet he expected Defendant to
turn the property over to the Temple. Either the gift letters represent a genuine intention
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that Defendant never repay the amount given to her, in which case she does not hold the
property in constructive trust for Donald Siclari’s benefit, or the gift letters are fraudulent,
in which case Donald Siclari is also not entitled to benefit from a constructive trust. The
Court therefore grants Defendant’s motion for summary judgment on the constructive
trust claim with regard to Donald Siclari.
Notwithstanding Donald Siclari’s conduct in executing gift letters that represented
that he expected no repayment for the gifts that he gave to Defendant, when in fact he
expected her to transfer the property to the Temple, the undisputed facts do not at this
time support the conclusion that the Temple itself acted with unclean hands. The
undisputed facts do not support the conclusion that the gift letters, the basis of the finding
of unclean hands, apply to or originated from the Temple and not merely from Donald
Siclari personally. The undisputed facts also do not show that Defendant made mortgage
or other payments toward the property, prior to barring the Temple from use of the
property, that the Temple did not reimburse to her. When considering Defendant’s
motion for summary judgment on the constructive trust claim as it relates to the Temple,
and making all reasonable inferences for the nonmoving party, the Court could infer that
Defendant was aware at the time of purchase that she was expected to turn the property
over to the Temple, and while she made payments related to the property, the Temple’s
reimbursement of those payments was based on the unwritten agreement that she
purportedly had made with the Temple, that the property was not truly hers, but rather,
was for the Temple’s use and eventual ownership. Based on those inferences, it is possible
that at trial, the Temple would be able to prove that it would not be equitable for
Defendant to retain the property outright, without some unjust enrichment.
Along related lines, the elements of unjust enrichment are “(1) a benefit was
conferred on defendant; (2) defendant accepted the benefit; and (3) defendant retained the
benefit under such circumstances that it would be inequitable for defendant not to
compensate plaintiff for its value.” Reed v. Zurn, 2010 VT 14, ¶ 11, 187 Vt. 613 (quoting
Center v. Mad River Corp., 151 Vt. 408, 412 (1989). Here, a “gift” of $100,000 toward the

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downpayment on a property was given to Defendant. Then, as Defendant made mortgage
and other payments related to the property, the Temple reimbursed her. There are no
undisputed facts that would indicate that Defendant made any unreimbursed payments
related to the property before the date when she excluded Plaintiffs from the property.
Whether or not the Temple’s asserted hundreds of thousands of dollars spent on
renovations increased the property value, and even if the $100,000 is deemed solely a gift,
as represented by the documents that Donald Siclari signed, then a finder of fact could still
reasonably conclude that it would be inequitable—a windfall—for Defendant to retain the
property at no other cost to her, since the Temple reimbursed her for all expenses. For this
reason, the claim of unjust enrichment cannot be decided in Defendant’s favor based on
the undisputed facts at this juncture. For related reasons, it also remains in dispute whether
it would be equitable for the Court to impose a constructive trust to the Temple’s benefit.
Order
For the reasons stated above, the Court grants Defendant’s motion for summary
judgment with regard to Donald Siclari’s claims for resulting trust, constructive trust, and
unjust enrichment, and the Temple’s claim for resulting trust. The Court denies
Defendant’s motion for summary judgment with regard to the Temple’s claims for
constructive trust and unjust enrichment. The Court denies Plaintiffs’ motion for summary
judgment.
Signed Electronically on September 18, 2024 pursuant to V.R.E.F. 9(d).

_________________________________________
David Barra
Superior Court Judge

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