Patel v. Patel

THE STATE OF SOUTH CAROLINA

In The Court of Appeals

Ghanshyam “Danny” Patel,       
Respondent,

v.

Vinod Patel,       
Appellant.

Appeal From Horry County

J. Stanton Cross, Jr., Master-in-Equity

Unpublished Opinion No. 2004-UP-097

Submitted February 9, 2004 – Filed February
17, 2004

AFFIRMED

H. Jay Haar, of Surfside Beach, for Appellant.         

William W. DesChamps, Jr., of Myrtle Beach, for Respondent.

PER CURIAM: This is an action for the collection
of an indebtedness in the sum of $200,000.  Ghanshyam “Danny” Patel brought
this action against Vinod Patel, alleging breach of contract, breach of contract
accompanied by fraudulent act, constructive fraud, conversion, fraud and deceit
based upon misrepresentation, and negligent misrepresentation.  The master-in-equity
ruled in favor of Danny.  Vinod appeals, arguing a resulting trust theory. 
We affirm. [1]

FACTS

Danny has owned and operated motels
in the Myrtle Beach area since 1980.  Vinod is in the business of constructing
and owning motels and is a thirty-five percent shareholder in Classic Investment,
Inc., a South Carolina Corporation.  

In January 1998, Classic purchased
unimproved real property in Surfside Beach for $500,000.  Vinod and Danny each
advanced $250,000 to Classic to enable Classic to purchase the property.  The
$250,000 loan from Danny to Classic was evidenced by a promissory note from
Classic in favor of Danny.  Classic’s statement of assets, liabilities, and
stockholders’ equity as of December 1999 showed a land value of $500,000.  After
Classic purchased the property, it obtained a construction loan to build the
motel, and each of the shareholders guaranteed the loan.  Classic also entered
into a franchise agreement with Comfort Inn – the shareholders personally guarantying
the obligations.  Danny was never a guarantor of any franchise obligation or
construction loan.

By 2000, Danny had advanced the total
principal sum of $575,000 to Vinod and Classic.  Classic received $375,000 and
Vinod received $200,000, pursuant to Vinod’s request and for use in constructing
the motel.  Danny testified that this $200,000 was independent of the $250,000
he advanced to Classic in January 1998.  In the confession of judgment, Classic
admitted liability to Danny for the $375,000.  In addition, the Final Order
and Judgment of Sale and Foreclosure confirmed the $375,000 indebtedness of
Classic in favor of Danny.  This $375,000 indebtedness includes the $250,000
advance Danny made to Classic in January 1998.

Although Classic admitted liability to Danny for
the $375,000, when Danny demanded payment from Vinod for his $200,000 indebtedness,
Vinod refused.  Danny brought this action alleging breach of contract, breach
of contract accompanied by fraudulent act, constructive fraud, conversion, fraud
and deceit based upon misrepresentations, and negligent misrepresentation. 
At the April 24, 2002 hearing, the master-in-equity ruled in favor of Danny
and awarded judgment in the amount of $200,000 plus pre-judgment interest at
the legal rate of 8¾% from January 7, 2000 to the date of the order and post-judgment
interest at the rate of 12% per annum from the date of judgment until paid. 
Vinod appeals, arguing the master erred in failing to find a resulting trust
was created in which title to the property would be conveyed from Classic to
Danny upon completion of the motel.

STANDARD OF REVIEW

Although an action to determine a resulting trust sounds in equity,
Vinod’s resulting trust defense is based on an alleged contract between Classic
and Danny for the reconveyance of Classic’s property.  Because an action on
a contract is one at law, this action is at law.  Therefore, we may only correct
errors of law and we are bound to uphold the master’s findings of fact unless
there is no evidence that reasonably supports them.  Townes Assocs., Ltd.
v. City of Greenville, 266 S.C. 81, 86, 221 S.E.2d 773, 775 (1976).

LAW/ANALYSIS

Vinod argues the $200,000 he received from Danny
was not a loan, but partial repayment for the $250,000 sum he allegedly advanced
on behalf of Danny to purchase the motel property in January 1998.  He contends
Danny wanted to purchase the property, but could only come up with half of the
purchase price; therefore, he provided the other half of the purchase price
as a loan to Danny.  As a result, he claims the trial court erred in failing
to find a resulting trust was created between him and Danny when he allegedly
advanced $250,000 to Danny and agreed to convey the property to Danny at a later
date. 

In asserting his resulting trust theory, Vinod
claims that title to the land was placed in the name of Classic for Danny’s
benefit.  We disagree and find the evidence shows Vinod and Danny each advanced
$250,000 to Classic to enable Classic to purchase the real property. 
A party attempting to prove the existence of a resulting trust in real property
must show by clear, definite, unequivocal, and convincing evidence that the
beneficiary of the trust paid a portion of the purchase money at the time of
the transaction.  Glover v. Glover, 268 S.C. 433, 435, 234 S.E.2d 488,
489 (1977).  Vinod failed to meet this burden of proof.  He did not prove by
definite, clear, unequivocal, and convincing evidence that the $250,000 Danny
advanced to Classic in January 1998 was partial payment for the real property,
instead of a loan to Classic.  The promissory note, confession of judgment,
and final order all document that the $250,000 Danny advanced to Classic in
January 1998 was a loan from Danny to Classic.  The promissory note, a written
contract, is binding against a claimed contemporaneous oral agreement that would
modify or vary it.  Ray v. South Carolina Nat’l Bank, Inc., 281 S.C.
170, 173, 314 S.E.2d 359, 361 (Ct. App. 1984).  Therefore, the written promissory
note, and the other written evidence, is controlling over Vinod’s alleged oral
agreement. 

Vinod alleges he intended for Classic to convey
its property and assets of Classic to Danny at a later date for a price to be
agreed upon.  However, for a resulting trust to be created, the beneficiary
of the trust, Danny, was required to pay the monies at the time of the purchase
of the property, not at some unspecified future date.  Glover, 268 S.C.
at 435, 234 S.E.2d at 489.  In addition, to form a binding contract, there must
be mutual manifestation of assent between the parties as to the contract terms,
and certain terms, such as price, time, and place, are indispensable and must
be set out with reasonable certainty.  McPeters v. Yeargin Constr. Co.,
290 S.C. 327, 331, 350 S.E.2d 208, 211 (Ct. App. 1986).  If a contract does
not fix a definite price term, there must be a definite method for ascertaining
it.  Id.  Therefore, in the present case, because the alleged agreement
for Classic to convey its property to Danny did not specify a date, price, or
a method for ascertaining the price, it is not binding and is unenforceable. 

We find sufficient evidence establishing an express
contract between Danny and Classic for a $250,000 loan.  However, even if the
promissory note, confession of judgment, and final order did not document this
express contract, we find the evidence shows the existence of an implied contract
for repayment.  To have a contract implied by law, there must be a benefit conferred
to a party, a realization of that benefit, and an inequitable retention of the
benefit.  Myrtle Beach Hosp. Inc. v. City of Myrtle Beach, 333 S.C. 590,
596, 510 S.E.2d 439, 442 (Ct. App. 1998).  Danny conferred a benefit of $200,000
to Vinod.  Vinod realized that benefit by receiving and depositing the money
into his account.  Vinod unjustifiably retained the $200,000 without conveying
to Danny any valuable consideration.  Implied contracts are similar to restitution,
which permits recovery of that amount the defendant has been benefited at the
expense of the plaintiff in order to preclude unjust enrichment.  Costa &
Sons Constr. Co. v. Long, 306 S.C. 465, 468, 412 S.E.2d 450, 452 (Ct. App.
1991).  Based on an implied contract theory, Danny should recover the $200,000
consideration he paid to Vinod.

As Vinod has not appealed the trial court’s findings
regarding the interest to be awarded on the $200,000, the trial court’s findings
are the law of the case.  First Union Nat’l Bank of South Carolina v. Soden,
333 S.C. 554, 556, 511 S.E.2d 372, 378 (Ct. App. 1998).  Therefore, we affirm
the award of pre-judgment and post-judgment interest. 

CONCLUSION

Based on the above, we find no error of law by
the trial judge.  Vinod’s resulting trust defense is unsubstantiated.  All the
evidence establishes the $250,000 Danny advanced to Classic in January 1998
was a loan, and no binding contract existed for conveying Classic’s assets to
Danny.  Thus, the $200,000 Danny gave to Vinod was not repayment of a loan,
but was a loan to Vinod; hence, Danny is entitled to collect the $200,000 from
Vinod.  Therefore, the order of the trial court is

AFFIRMED.

HEARN, C.J., ANDERSON and BEATTY, JJ., concur.

[1] We decide this case without oral argument pursuant
to Rule 215, SCACR.