Nelson v. 15 White Barn Drive

2022 UT App 106

THE UTAH COURT OF APPEALS

LORI KATHRYN NELSON,
Appellant,
v.
15 WHITE BARN DRIVE LLC
AND JAMES HOUGHTALEN,
Appellees.

Opinion
No. 20210248-CA
Filed August 25, 2022

Second District Court, Ogden Department
The Honorable Ernest W. Jones
No. 190903147

Brad C. Smith, Attorney for Appellant
Howard Burt Ringwood and Spencer Wyatt Young,
Attorneys for Appellees

JUDGE MICHELE M. CHRISTIANSEN FORSTER authored this Opinion,
in which JUSTICE JILL M. POHLMAN and JUDGE RYAN M. HARRIS
concurred.1

CHRISTIANSEN FORSTER, Judge:

¶1 Lori Kathryn Nelson appeals the district court’s grant of
summary judgment in favor of 15 White Barn Drive LLC (White

1. Justice Jill M. Pohlman began her work on this case as a judge
of the Utah Court of Appeals. She became a member of the Utah
Supreme Court thereafter and completed her work on this case
sitting by special assignment as authorized by law. See generally
Utah R. Jud. Admin. 3-108(4).
Nelson v. 15 White Barn Drive

Barn) and James Houghtalen (collectively, the Defendants) on
Nelson’s claims of equitable mortgage and fraud.2 We affirm.

BACKGROUND3

¶2 Nelson owned certain real property (the Property)
as trustee of her mother’s trust. After her mother passed away,
Nelson “was fearful of defaulting on the mortgage that existed
at that time on the [P]roperty.” The mortgage was approximately
$36,000, and the Property was worth approximately $200,000.
Nelson discussed her financial worries with her friend,
James Houghtalen. He told her that although he did not have any
money of his own to lend her, he “might know some private
lenders.”

¶3 According to Houghtalen, he tried to help Nelson find a
lender but was unsuccessful because she was not employed.
Houghtalen’s wife (Wife) had the means to provide a loan, but
when Houghtalen approached her about lending money to
Nelson, she declined “because of [Nelson’s] financial situation.”
However, Wife offered to purchase the Property for $55,000 so
Nelson could pay off the mortgage and meet her other
obligations. Wife formed White Barn to purchase the Property
and gave Houghtalen a 1% interest in White Barn to facilitate the
transaction.

2. Nelson’s complaint also raised claims of quiet title and
constructive trust, but she does not address the dismissal of those
claims on appeal, and therefore, neither do we.

3. In reviewing the district court’s grant of summary judgment,
we view the facts “in the light most favorable to” Nelson, as “the
nonmoving party.” See Orvis v. Johnson, 2008 UT 2, ¶ 6, 177 P.3d
600 (quotation simplified).

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Nelson v. 15 White Barn Drive

¶4 Nelson believed that she had agreed to take a loan from
White Barn and that she was obligated to pay off the $55,000 loan
plus an additional “$10,000 as a good deed for [giving her] the
loan,” minus a credit for all rent payments White Barn received
from leasing the Property. On the other hand, Houghtalen and
Wife’s understanding of the agreement was that White Barn
would purchase the Property and then give Nelson the
opportunity “to repurchase the home in two years at a
predetermined price” of $65,000, less a partial rent credit of
approximately $70 per month—the amount of equity Wife
believed Nelson would have gained had she been paying on a
loan. Wife explained that the parties initially anticipated that
Nelson would live at the Property and pay rent, so they intended
to put the option-to-purchase terms in a lease agreement separate
from the sale agreement. According to Houghtalen and Wife, their
goal was to allow Nelson to take “two years to get her act together
and get a job and fix her credit” so that she could rebuy the
Property.

¶5 Houghtalen did not tell Nelson that Wife was the person
providing the funding for the transaction because Wife “wanted
it to strictly be a business transaction” so that Nelson would take
seriously the opportunity to buy back the Property and not see it
as assistance from a friend. Houghtalen assured Nelson that
White Barn would not attempt to sell the Property for two years.

¶6 Ultimately, Nelson decided not to reside at the Property,
so the parties did not prepare a lease agreement. When Wife
learned Nelson would not be living at the Property, she instructed
Houghtalen to inform Nelson of changes she wanted to make to
the agreement regarding the option to purchase, namely that
Nelson would not be able to repurchase the Property sooner than
two years after the transaction because Wife “wanted to make
sure [she] could get a long-term [renter] in there” during that
period. Nelson would then have from July 6, 2019, to September
1, 2019, “to purchase the Property from White Barn.” Although

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the rent credit the parties had discussed was initially based on
Nelson paying rent, Wife told Houghtalen that she would agree
to give Nelson the promised $70 rent credit even if White Barn
rented the Property to someone else.

¶7 In July 2017, Nelson and White Barn, through Houghtalen,
executed a real estate purchase contract (the REPC). The REPC
stated, “Seller represents that Seller has fee title to the Property
and will convey marketable title to the Property to Buyer at
Closing by general warranty deed.” The REPC further
contained an integration clause, which stated that “the
entire contract between the parties” consisted of “[t]he REPC
together with its addenda, any attached exhibits, and
Seller Disclosures” and that the contract “supersedes and replaces
any and all prior negotiations, representations, warranties,
understandings or contracts between the parties whether
verbal or otherwise.” Nelson also signed a warranty deed (the
Warranty Deed) conveying title to the Property to White Barn.
Neither the REPC nor the Warranty Deed contained any terms
regarding an option for Nelson to purchase the Property or the
amount of any rent credits she would receive, and the parties
never executed a separate agreement memorializing any such
terms.

¶8 According to Nelson, she “didn’t know” the parties’
agreement was to be “a purchase contract.” Nelson recounted the
following conversation that occurred right after she signed the
REPC:

[Houghtalen] says, “Well, you know you don’t own
the house anymore, . . . but look at the bright side,
the new owner’s going to have to pay for everything
that happens to the house.”

I says, “What do you mean by that?”

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He says, “Well, if the washer and dryer go bad,
they’re going to replace them. If the plumbing
floods, they’re going to have to fix it.”

I said, “Well, I guess that’s a plus, but it doesn’t
make me happy.”

According to Nelson, that was the first time she realized she had
sold the Property. Up until that point, she “thought it was a loan.”
She signed the REPC and the Warranty Deed without reading
them because she “trusted” Houghtalen.

¶9 Nelson later sued the Defendants, raising claims of quiet
title, equitable mortgage, constructive trust, and fraud. Nelson,
Wife, and Houghtalen were all deposed, and the following
exchange took place at Nelson’s deposition:

Q. Okay. In your complaint, you have alleged that
White Barn and Mr. Houghtalen have committed
fraud. Do you recall making that complaint?

A. I don’t recall using the word “fraud.”

Q. Would you consider—as you sit here today, do
you believe that the word—that the use of the word
“fraud” is inappropriate?

A. I think it’s a giant misunderstanding.

Q. Okay. You don’t think anything was
intentionally done?

A. No. I don’t think he meant to hurt me.

Q. Okay. So you genuinely believe that they were
trying to help you and that it was just a

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misunderstanding as to whether it was a purchase
or whether it was a loan?

A. Yes. I mean I knew nothing about his wife. It was
just [Houghtalen] that I dealt with. And I don’t think
he meant to hurt me.

¶10 Nelson filed a motion for summary judgment, which the
district court denied. The Defendants subsequently filed a motion
for summary judgment, which the district court granted. With
respect to Nelson’s equitable mortgage claim, the district court
determined that the written terms of the parties’ REPC governed
their agreement and that there was no basis to consider extrinsic
evidence of the parties’ intent. It accordingly granted the
Defendants’ motion for summary judgment on that claim. The
court also granted summary judgment in favor of the Defendants
on Nelson’s fraud claim because it determined that Nelson “failed
to provide any evidence to support her fraud claim.”

¶11 The Defendants requested their attorney fees and costs on
the ground that the REPC provided for such an award to the
prevailing party. Nelson failed to respond to this motion, and the
district court granted the request.

¶12 Nelson now appeals.

ISSUES AND STANDARD OF REVIEW

¶13 Nelson argues that the district court erred in granting the
Defendants’ motion for summary judgment on her equitable
mortgage and fraud claims.4 Summary judgment is appropriate

4. Nelson also challenges the district court’s denial of her motion
to strike affidavits submitted by the Defendants, which she claims
(continued…)

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Nelson v. 15 White Barn Drive

where “the moving party shows that there is no genuine dispute
as to any material fact and the moving party is entitled to
judgment as a matter of law.” Utah R. Civ. P. 56(a). Thus, in
reviewing a motion for summary judgment, we must “review the
district court’s decision to ensure its legal conclusions were
correct, and we must review the record to ensure no genuine and

contradicted Houghtalen’s and Wife’s testimonies in their
depositions. See generally Harnicher v. University of Utah Med.
Center, 962 P.2d 67, 71 (Utah 1998) (“The general rule is that in a
summary judgment proceeding, when a party takes a clear
position in a deposition, that is not modified on cross-
examination, he may not thereafter raise an issue of fact by his
own affidavit which contradicts his deposition, unless he can
provide an explanation of the discrepancy.” (quotation
simplified)). However, Nelson does not identify any statements in
the relevant affidavits that she alleges contradict the depositions
or even cite those affidavits at all. Instead, she refers to statements
in the Defendants’ opposition to Nelson’s motion for summary
judgment in which they cited the affidavits and challenged
Nelson’s characterization of various statements in the
depositions. Nelson then leaves it to us to review that pleading
and cross-reference and compare the Defendants’ explanations
with the affidavits and the depositions. Because she has left to this
court the burden of sifting through the record and crafting an
argument, her argument is inadequately briefed. See Allen v. Friel,
2008 UT 56, ¶ 9, 194 P.3d 903 (“An appellate court is not a
depository in which a party may dump the burden of argument
and research.” (quotation simplified)). We therefore decline to
address its merits. See Fuller v. Springville City, 2015 UT App 177,
¶ 19, 355 P.3d 1063 (“It is well established that Utah appellate
courts will not consider claims that are inadequately briefed.”
(quotation simplified)).

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Nelson v. 15 White Barn Drive

material factual disputes exist.” Shree Ganesh, LLC v. Weston Logan,
Inc., 2021 UT 21, ¶ 13, 491 P.3d 885.

ANALYSIS

I. Equitable Mortgage

¶14 Nelson first challenges the district court’s grant of
summary judgment in favor of the Defendants on Nelson’s
equitable mortgage claim. She argues that the court should have
considered extrinsic evidence of the parties’ intent with respect to
the terms of the agreement between them and that, considering
that evidence in the light most favorable to Nelson, an issue of fact
existed regarding whether the REPC and the Warranty Deed
should be construed as an equitable mortgage on the Property
rather than an agreement to transfer title to the Property.

¶15 “[A] deed, absolute in form, may be construed as a
mortgage if it is intended as security under a parol agreement
rather than an outright conveyance.” Bown v. Loveland, 678 P.2d
292, 297 (Utah 1984). But “when the transaction features not only
a deed but also a contemporaneous written agreement stating the
terms of the transaction . . . , the deed will be read in light of the
written agreement and will be subject to the established rules of
construction concerning such agreements.” Glauser Storage, LLC v.
Smedley, 2001 UT App 141, ¶ 20, 27 P.3d 565. “Thus, if a party
claims a deed was intended as a mortgage, and no written
agreement regarding the transaction exists, courts have no choice
but to consider parol evidence to determine the parties’ intent.”
Id. “On the other hand, if the parties entered into a written
agreement at about the same time the deed was given, the court
will look first to that agreement in its effort to decide what the
parties intended.” Id. And in that case, “[a]ny attempts to vary the
unambiguous terms of the contemporaneous written agreement
is subject to the parol evidence rule,” which “operates . . . to

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Nelson v. 15 White Barn Drive

exclude evidence of contemporaneous conversations,
representations, or statements offered for the purpose of varying
or adding to the terms of an integrated contract.” Id. ¶ 21
(quotation simplified).

¶16 Here, the Warranty Deed was accompanied by the REPC,
which unambiguously demonstrated the parties’ intent to enter
into a purchase agreement rather than a mortgage. The REPC is
titled “Real Estate Purchase Contract” and accordingly concerned
a real estate purchase. It further provided that Nelson would
“convey marketable title to the Property to [White Barn] at
Closing by general warranty deed.” There is no reasonable
reading of this language that would allow the REPC or the
Warranty Deed to be construed as creating a mortgage, and
Nelson has suggested none. Accordingly, the parol evidence rule
applies to preclude evidence of the parties’ intent that
contradicted the written agreement.

¶17 Nelson alternatively asserts that a court may consider parol
evidence “in equity.” To be sure, one exception to the parol
evidence rule allows extrinsic evidence to be admissible in equity
“where the contract is alleged to be a forgery, a joke, a sham,
lacking in consideration, or where a contract is voidable for fraud,
duress, mistake, or illegality.” Tangren Family Trust v. Tangren,
2008 UT 20, ¶ 15, 182 P.3d 326. But while Nelson asserts that the
contract was procured by fraud, she provided no evidence to
support her fraud claim. See infra ¶¶ 21–23. Therefore, there was
no equitable basis for the court to consider extrinsic evidence of
the parties’ intent.5

¶18 Finally, Nelson asserts that the court should consider parol
evidence because she claims the REPC was “repudiated by every

5. Nelson did not raise claims of mutual mistake or reformation.

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party.”6 But while Nelson asserts that this demonstrates that there
was “no meeting of the minds” as to the REPC’s terms, she has
not identified any exception to the parol evidence rule that would
allow us to consider extrinsic evidence. Instead, Nelson relies on
Webster v. JP Morgan Chase Bank, NA, 2012 UT App 321, 290 P.3d
930, for the proposition that a plaintiff may be able to reasonably
rely on contemporaneous oral representations even if those terms
are not included in the contract or appear to be contradicted by
the contract. See id. ¶¶ 6–13. But unlike Nelson, the plaintiff in
Webster did not assert that the written contract was invalid due to
the agreement’s failure to reflect the oral representations; she
merely sought to enforce the oral representations. See id. Here,
Nelson has not raised any argument attempting to enforce the
option to purchase that she claims was left out of the REPC. 7
Instead, she asks the court to treat the REPC as a mortgage
because it did not contain additional terms she believes the parties
agreed to. Webster does not support such a result.

¶19 It is unfortunate if Nelson failed to understand the effect of
the agreement she signed, especially given the difference between
the purchase price and the apparent value of the Property. But “in
the context of contract formation, . . . each party has the burden to

6. Contrary to Nelson’s characterization of Houghtalen’s and
Wife’s testimonies, we see no evidence from which a reasonable
jury could conclude that either of these individuals repudiated the
terms of the REPC. Instead, both agreed that their intent was to
allow Nelson an opportunity to repurchase the Property and to
receive some credit for rent and that this agreement was never
reduced to writing.

7. Nelson never asked the court to enforce any version of the
option to purchase, and we are aware of no evidence suggesting
that Nelson attempted to exercise the option to purchase or that
the Defendants prevented her from doing so.

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read and understand the terms of a contract before he or she
affixes his or her signature to it.” McCleve Props., LLC v. D. Ray
Hult Family Ltd. P’ship, 2013 UT App 185, ¶ 12, 307 P.3d 650
(quotation simplified); see also Oliphant v. Estate of Brunetti, 2002
UT App 375, ¶¶ 20–21, 64 P.3d 587 (rejecting an argument that
there was no meeting of the minds because one party “did not
really know what she was signing”). Here, the terms of the REPC
and the Warranty Deed were clear, and in such a situation, we
must infer Nelson’s intent from the terms to which she explicitly
agreed. See Allen v. Bissinger & Co., 219 P. 539, 541–42 (Utah 1923)
(“The apparent mutual assent of the parties, essential to the
formation of a contract, must be gathered from the language
employed by them, and the law imputes to a person an intention
corresponding to the reasonable meaning of its words and acts.”
(quotation simplified)); see also Burningham v. Westgate Resorts,
Ltd., 2013 UT App 244, ¶ 21, 317 P.3d 445 (explaining that where
“the terms of the parties’ agreement are contained in a written
contract, . . . we look to that document to evaluate whether the
parties reached the required meeting of the minds”). While her
subjective intent and understanding may have been different,
there is no basis to credit it over the express terms of the contract
she signed. See Glauser Storage, 2001 UT App 141, ¶ 20 (explaining
that our courts have a “pronounced preference for gleaning the
parties’ intent, whenever possible, from written agreements
rather than from self-serving testimony”). Accordingly, we agree
with the district court that the Defendants were entitled to
summary judgment on Nelson’s equitable mortgage claim.

II. Fraud

¶20 Nelson next challenges the district court’s grant of
summary judgment in favor of the Defendants on her fraud claim.
To prove fraud, Nelson had the burden of demonstrating nine
elements:

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Nelson v. 15 White Barn Drive

(1) A representation; (2) concerning a presently
existing material fact; (3) which was false; (4) which
the representor either (a) knew to be false, or (b)
made recklessly, knowing that he had insufficient
knowledge upon which to base such representation;
(5) for the purpose of inducing the other party to act
upon it; (6) that the other party, acting reasonably
and in ignorance of its falsity; (7) did in fact rely
upon it; (8) and was thereby induced to act; (9) to his
injury and damage.

Carlton v. Brown, 2014 UT 6, ¶ 37, 323 P.3d 571 (quotation
simplified). Because Nelson would bear the burden of proving
these elements at trial, the Defendants could establish that they
were entitled to summary judgment on the fraud claim by
demonstrating that Nelson had failed to present sufficient
evidence in support of any one or more of these elements. See Salo
v. Tyler, 2018 UT 7, ¶ 2, 417 P.3d 581 (explaining that where the
nonmoving party “will bear the burden of production at trial . . .
the moving party may carry its burden of persuasion” on a motion
for summary judgment—“without putting on any evidence of its
own—by showing that the nonmoving party has no evidence to
support an essential element of a claim”).

¶21 In support of her fraud claim, Nelson alleged in her
complaint that Houghtalen made the following false
representations:

(a) That he would procure a private lender who
would advance funds to [Nelson];

(b) That the private lender was someone other
than . . . Houghtalen;

(c) That the private lender would advance funds
in exchange for a fee of $10,000.00;

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(d) That the private lender expected to be repaid
and reconvey the [P]roperty in question to
[Nelson];

(e) That . . . Houghtalen would provide a payoff
upon request; and

(f) That by engaging in this course of dealing,
[Nelson] could preserve and retain the
[P]roperty, value in the [P]roperty, and its
equity for herself and her use.

¶22 Except for the final representation on the list, Nelson has
not pointed us to any evidence that Houghtalen misrepresented
the terms of the parties’ agreement; neither does a review of her
deposition testimony reveal any such evidence. Nelson asserted
during her deposition that Houghtalen told her he “might know
some private lenders” and that he would “check with them.”
While she asserted that she signed the REPC and the Warranty
Deed without reading them because she “trusted” Houghtalen,
she did not recount her conversations with Houghtalen regarding
the transaction with White Barn or what Houghtalen represented
to her about that transaction. Instead, she discussed her personal
understanding of the transaction: that she “thought it was a loan,”
that she believed she would “have to pay the [$]55,000 plus”
“$10,000 as a good deed for doing the loan” within two years, and
that she expected to get credit for any rent paid for the house in
the meantime.

¶23 As to the final representation, there is evidence that both
Houghtalen and Wife entered into the transaction with the intent
to help Nelson get into a position to reclaim the Property.
Specifically, both of them testified that White Barn, through
Houghtalen, had agreed to give Nelson the opportunity to
repurchase the Property after two years by paying White Barn
$65,000 during a two-month window between July and

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September 2019. But Nelson has not pointed to any evidence
suggesting that any representations regarding Houghtalen’s and
White Barn’s intent to help Nelson by allowing her to repurchase
the Property were false. In fact, Nelson herself did not believe the
Defendants committed fraud—she expressed during her
deposition her belief that the incident was “a giant
misunderstanding” and that Houghtalen did not mean to hurt
her.

¶24 In the absence of any evidence of fraudulent statements,
Nelson cannot meet her burden to establish her fraud claim. See
Salo, 2018 UT 7, ¶ 2. Therefore, the district court did not err in
granting summary judgment in favor of the Defendants.

III. Attorney Fees

¶25 Nelson challenges the district court’s award of attorney
fees to the Defendants on the ground that the court erred in
granting summary judgment in favor of the Defendants and that
they were therefore not the prevailing parties. She also requests
that she be awarded her fees based on Utah’s reciprocal fees
statute. Because we affirm the district court’s ruling, we
necessarily reject the premise of Nelson’s argument. Accordingly,
we affirm the district court’s award of fees.

¶26 The Defendants request their fees and costs on appeal
based on the terms of the REPC. Because the Defendants were
awarded their fees below and they have prevailed on appeal, we
grant their request for attorney fees and costs incurred on appeal.
See Wing v. Code, 2016 UT App 230, ¶ 27, 387 P.3d 601 (“When
under a contractual fee provision a party is entitled to attorney
fees below and prevails on appeal, that party is also entitled to
fees reasonably incurred on appeal.” (quotation simplified)).

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CONCLUSION

¶27 The district court did not err in granting summary
judgment in favor of the Defendants on Nelson’s equitable
mortgage and fraud claims. The court could not consider parol
evidence to vary the terms of the parties’ written REPC, and
Nelson failed to present sufficient evidence of fraud. Moreover,
the court did not err in awarding attorney fees in favor of the
Defendants. Accordingly, we affirm and remand for the district
court to calculate the Defendants’ attorney fees incurred on
appeal.

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