Allen v. Hall

2006 UT 70
This opinion is subject to revision before final
publication in the Pacific Reporter.
IN THE SUPREME COURT OF THE STATE OF UTAH
----oo0oo----
David J. Allen, an individual, No. 20050338
Plaintiff and Petitioner,
v.
Thomas K. Hall, an individual;
and Homecomings Financial Network,
Inc., a Delaware corporation,
Defendants and Respondents.
Chad R. Moore, an individual; and F I L E D
Melanie S. Moore, an individual,
Intervenors. November 17, 2006
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Third District, Salt Lake
The Honorable Tyrone E. Medley
No. 000904054
Attorneys: James G. Swensen, Salt Lake City, for petitioner
Thomas K. Hall, Draper, pro se
Bruce J. Nelson, Salt Lake City, for Homecomings
Ronald G. Russell, Matthew J. Ball, Salt Lake City,
for intervenors
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On Certiorari to the Utah Court of Appeals
NEHRING, Justice:
¶1 Sarah Satterfield acquired the marital home in her
divorce from David Allen, but with strings attached. If, for
example, Ms. Satterfield moved more than fifty miles from Salt
Lake City before the parties’ youngest child reached 18 years of
age, the fee interest in the home would revert to Mr. Allen, who
would be required to sell the home and divide the equity equally
with Ms. Satterfield.
¶2 Ms. Satterfield moved to North Carolina when her
youngest child was 14 years old. Before moving from Utah,

No. 20050338 2
Ms. Satterfield refinanced the home several times and conveyed
her interest in it to Thomas Hall who made improvements to the
home. Other conveyances and related debts secured by the
property followed. Mr. Allen sued to reclaim his interest in the
home. The trial court denied Mr. Allen’s claim. On appeal, the
court of appeals quieted title in Mr. Allen but required him to
assume the debt secured by the property after he conveyed the
home to Ms. Satterfield and to pay Mr. Hall for improvements
under the provisions of Utah’s Occupying Claimants Act, Utah Code
Ann. §§ 57-6-1 to -8.
¶3 We affirm the court of appeals’ award of title to
Mr. Allen but reverse the court’s determination that Mr. Hall is
entitled to protection under the Occupying Claimants Act and
remand for further proceedings on the merits of Mr. Allen’s claim
of unjust enrichment.
BACKGROUND
¶4 Mr. Allen and Ms. Satterfield were divorced in 1990.
The divorce decree awarded Ms. Satterfield the marital home.
Ms. Satterfield’s continued ownership of the home was contingent
upon making timely payments on the home’s mortgage and
maintaining her residence within fifty miles of Salt Lake City,
Utah, until after their youngest child turned eighteen.
According to the terms of the divorce decree, should
Ms. Satterfield fail to comply with either of these conditions,
the fee interest in the property would revert to Mr. Allen, who
would then “be responsible for all indebtedness thereon” and who
would be obligated to sell the property and equally divide any
equity realized from the sale with Ms. Satterfield.
¶5 All of the provisions of the divorce decree bearing on
this controversy are located in paragraph 10 of the
Allen/Satterfield divorce decree, which states:
[Allen] is purchasing the house and lot
located at 10159 Flanders Road, Sandy, Utah
which shall be awarded to [Satterfield] as
her sole and separate property subject to no
claim by [Allen] except as set forth in this
paragraph. [Satterfield] shall be
responsible for all indebtedness and expenses
therefrom, holding [Allen] harmless
therefrom. [Allen] shall provide
[Satterfield] with a quit-claim deed within
30 days of the divorce becoming final, with
said quit-claim deed to contain the
provisions that it is contingent upon

3 No. 20050338
[Satterfield] maintaining durrent [sic] house
payments and not moving from the Salt Lake
City area before the [parties’] last child
reaches age 18. . . . If [Satterfield] shall
move more than 50 miles from Salt Lake City
Utah before the last child reaches age 18,
ownership of the marital residence shall
revert to [Allen], who will then sell the
home and divide the proceeds equally with
[Satterfield], and who will be responsible
for all indebtedness thereon until the house
is sold. These provisions are to ensure that
the children have a suitable residence during
their minority, and are structured to provide
a benefit to [Satterfield] if she shall
continue to reside in Salt Lake City, Utah in
the form of all of the equity in said home,
and a detriment if she shall move, in the
form of the loss of one-half of the equity.
¶6 Mr. Allen transferred the property to Ms. Satterfield
by quit-claim deed in 1993. The deed contains the following
language of reservation:
This Quit-Claim Deed is subject to the rights
and reservations included in that certain
Decree of Divorce entered by the Third
Judicial District Court, Salt Lake County,
State of Utah in the case of David John Allen
v. Sarah Satterfield Allen, Civil No.
894903635 (dated May 17, 1990). Said Decree
of Divorce provides, in part, that if the
grantee fails to maintain current house
payments or if the grantee shall move more
than 50 miles from Salt Lake City, Utah,
before the grantor and grantee’s last child
reaches 18 year [sic] of age, title and
ownership of the above described property
shall revert to the grantor.
¶7 Ms. Satterfield and her children took possession of the
property and, between 1990 and 1998, refinanced it several times.
Mr. Allen was aware of some of the refinancing and even assisted
Ms. Satterfield in refinancing the home on at least one occasion.
Mr. Allen never received any proceeds from Ms. Satterfield’s
refinancing.
¶8 In January 1998, Ms. Satterfield conveyed the property
by quit-claim deed to Mr. Hall. Mr. Hall paid Ms. Satterfield

No. 20050338 4
$7,000 cash and assumed the existing first and second mortgages
totaling approximately $139,000. In June 1999, Mr. Hall retired
the existing mortgages when he refinanced the property with
Homecomings Financial Network, Inc., in the amount of $151,900.
¶9 Although Ms. Satterfield moved from the home after
selling it to Mr. Hall, she maintained her residence within fifty
miles of Salt Lake City. In July 1999, Mr. Allen’s reversionary
interest was awakened when Ms. Satterfield moved away from Utah.
Shortly thereafter, Mr. Allen contacted Mr. Hall and claimed
ownership of the property. Mr. Hall refused to recognize
Mr. Allen’s claim, and in 2000, Mr. Allen brought this quiet
title action against Mr. Hall. Mr. Hall counterclaimed, seeking
to quiet his own title and for damages including, in the event
the court eventually sided with Mr. Allen, reimbursement for
improvements he had made to the property.
¶10 The trial court quieted title to the property in
Mr. Hall. The trial court also found that were Mr. Allen to be
awarded title to the property, he would take the property subject
to all existing debt including the Homecomings mortgage, and that
Mr. Hall would be entitled to reimbursement of $52,279.36 for
improvements to the home and $6,974.67 in property taxes paid by
Mr. Hall. Mr. Allen appealed.
¶11 Meanwhile, Mr. Hall transferred the property to
Homecomings by deed in lieu of foreclosure and, in 2004, Mr. Chad
Moore and Mrs. Melanie Moore purchased the property from
Homecomings.
¶12 On appeal, the court of appeals affirmed in part and
reversed in part. The court of appeals reversed the trial
court’s ruling quieting title in Mr. Hall. It determined that
Mr. Allen was entitled to the property--subject to the debt
encumbering the property and reimbursement to Mr. Hall under the
Utah Occupying Claimants Act for the value of Mr. Hall’s
improvements to the property. We granted certiorari to answer
three questions: (1) whether Mr. Hall, who held title to
property subject to Mr. Allen’s reversionary interest, is
entitled to compensation for improvements under the Occupying
Claimants Act and, if so, whether the court of appeals properly
determined the value of the improvements; (2) whether Mr. Allen
was required to assume all mortgage debt on the property and not
just the mortgage that was in place when he deeded the property
to Ms. Satterfield; and (3) whether the court of appeals failed
to consider Mr. Allen’s own claims for unjust enrichment, based
upon Mr. Hall’s use of the property after ownership of the home
reverted to Mr. Allen.

5 No. 20050338
ANALYSIS
I. THE PROPERTY INTEREST CREATED BY THE DECREE OF DIVORCE WAS A
FEE SIMPLE DETERMINABLE
¶13 Both Mr. Hall’s right to recover for the value of the
improvements he made to the Allen/Satterfield home and the right
of creditors whose interests are secured by the home depend on
the nature of the property interest described in paragraph 10 of
the divorce decree. For reasons that we will explain, the
interest conveyed first to Ms. Satterfield then to Mr. Hall on to
Homecomings and finally to the Moores was a fee simple
determinable.
¶14 “If a fee estate can be determined or defeated by an
event which is not certain to occur, it is a defeasible fee
simple . . . . A defeasible fee gives the complete set of rights
of ownership to the grantee until the defeating event arises.”
James H. Backman, Thomas and Backman on Utah Real Property Law
§ 2.02(c), at 43 (1999) (Supp. 2004). Defeasible fee interests,
in turn, fall into two categories: fee simple determinable and
fee simple subject to a condition subsequent. The two classes of
defeasible interests may be distinguished by the consequences
that befall the holder of the defeasible interest if the event
that makes the fee defeasible occurs.
¶15 In the case of the fee simple determinable, the
defeasible fee will terminate automatically upon the occurrence
of the condition. Nelson v. Provo City, 872 P.2d 35, 38 (Utah
Ct. App. 1994) (citing Black’s Law Dictionary 615-16 (6th ed.
1990)). By contrast, a fee simple subject to a condition
subsequent is an estate that will be terminated only after the
grantor re-enters the land or makes a claim to it following the
occurrence of the condition. With the fee simple subject to a
condition subsequent, the grantee holds the fee subject to the
possibility of reverter and not the inevitability of reverter
that marks the fee simple determinable.
¶16 Paragraph 10 of the divorce decree states that, in the
event Ms. Satterfield moves more than fifty miles from Salt Lake
City before the youngest child of the parties turns eighteen
years of age, “ownership of the marital residence shall revert to
[Mr. Allen].” This is unambiguous language creating a fee simple
determinable. This language was repeated in the quit-claim deed
through which Mr. Allen conveyed the property to Ms. Satterfield.
The deed states that
if the grantee [Satterfield] fails to
maintain current house payments or if the

No. 20050338 6
grantee shall move more than 50 miles from
Salt Lake City, Utah, before the grantor and
grantee’s last child reaches 18 year [sic] of
age, title and ownership of the above
described property shall revert to the
grantor [Allen].
Accordingly, we conclude that Mr. Allen conveyed a fee simple
determinable to Ms. Satterfield.
II. AN OWNER WHO HOLDS IN FEE SIMPLE DETERMINABLE IS NOT
ENTITLED TO COMPENSATION FOR HIS IMPROVEMENTS UNDER THE UTAH
OCCUPYING CLAIMANTS ACT
¶17 The Utah Occupying Claimants Act, Utah Code Ann. §§ 57-
6-1 to -8, provides relief to a party who innocently, but
wrongfully, occupies real property under “color of title.” Our
state has extended such relief to occupants of land by statute
since statehood. We summarized the policy objectives of the Act
in our observation that
such statutes ameliorate the strict common
law rule that the record owner is entitled to
the improvements placed by another upon his
property and are based upon the equitable
doctrine of unjust enrichment, which entitles
the bona fide claimant, who acted while in
possession under color of title, to recover
the value of his improvements to the extent
that they unjustly enrich the record owner by
enhancing the value of his land.
Reimann v. Baum, 115 UT 147, 157-58, 203 P.2d 387 (1949).
¶18 In this case, Mr. Hall’s eligibility for relief under
the Act turns on whether he had “color of title” in the
Allen/Satterfield residence. The Act defines “color of title” in
section 57-6-4, stating:
Any person has color of title who has
occupied a tract of real estate by himself,
or by those under whom he claims, for the
term of five years, or who has occupied it
for less time, if he, or those under whom he
claims, have at any time during the occupancy
with the knowledge or consent, express or
implied, of the real owner made any valuable
improvements on the real estate, or if he or
those under whom he claims have at any time

7 No. 20050338
during the occupancy paid the ordinary county
taxes on the real estate for any one year,
and two years have elapsed without a
repayment by the owner, and the occupancy is
continued up to the time at which the action
is brought by which the recovery of the real
estate is obtained.
Utah Code Ann. § 57-6-4 (2000 & Supp. 2006).
¶19 A closer look at this provision discloses why Mr. Hall
does not satisfy its requirements. Section 57-6-4 creates a
definition of “color of title” that is a more restrictive
definition than the general understanding of the term. Under its
common meaning, “color of title” could be held by a party who
does not occupy the property. Under the Act, one must occupy
land to claim “color of title.” Of course, Mr. Hall occupied the
home and therefore met this requirement. However, Mr. Hall is
disqualified from recovery under the Act because his occupation
of the home was under a title that was too good to qualify as
“color of title.”
¶20 The Act’s definition of “color of title” shares with
its general meaning the core feature of title imperfection. A
holder by “color of title” has a claim to title that while having
the appearance of validity is in reality defective. See Black’s
Law Dictionary 266 (6th ed. 1990). This element of “color of
title” appears in section 57-6-4 when the text distinguishes the
occupying claimant from the “real owner.”
¶21 Mr. Hall was the “real owner” of the Allen/Satterfield
home when he made the improvements to it. There was no defect in
his title. He was the lawful owner of a fee simple determinable.
When he made the improvements to the property, there was no
guarantee that the value of the improvements would be enjoyed by
Mr. Allen. Indeed, there was little Mr. Allen could do about
Mr. Hall’s decisions concerning the property. As the fee holder,
Mr. Hall was free to deal with the property as he saw fit. Under
these circumstances, the considerations of fairness and equity
that form the policy rationale for the Act are not present.
¶22 The Act cannot reasonably co-exist with fee simple
determinable estates. The grantor of a fee simple determinable
has the expectation that the estate which may revert to him will
be of the same quality as the estate he conveyed. See
Restatement (First) of Property § 44 (1936). This expectation
would be frustrated were the grantor to be exposed to liability
for the costs of improvements over which he had no control.
There is nothing in the Act to suggest that the legislature

1 While we reverse the court of appeals’ decision on this
issue, we note that the court of appeals did not fully analyze
the applicability of the Act to Mr. Hall’s property interest
because Mr. Allen conceded that Mr. Hall held the property under
“color of title.” We have exercised our discretion upon
certiorari review to consider whether the Act may be extended to
fee simple determinable interests irrespective of this
concession.
No. 20050338 8
intended that it supplant the core principles of fee simple
determinable estates, and we decline to bring them within the
reach of the Act. We therefore reverse the court of appeals’
determination that Mr. Hall was entitled to recovery under the
Act.1
III. MR. ALLEN IS ENTITLED TO HOLD TITLE FREE OF THE REMAINING
INDEBTEDNESS
¶23 Based on its interpretation of the terms of the decree
of divorce, the court of appeals held that Mr. Allen was liable
for indebtedness, secured by the property, that was acquired
after he conveyed the home to Ms. Satterfield. The court of
appeals agreed with the trial court that Mr. Allen’s consent to
“be responsible for all indebtedness thereon until the house is
sold” meant that he would be liable for debt acquired before the
property reverted to him by reason of Ms. Satterfield’s
relocation. This interpretation fails to account for the effect
of the reversion on that indebtedness.
¶24 The estate that reverted to Mr. Allen was the same
estate that he held at the time he conveyed the fee simple
determinable interest to Ms. Satterfield. That estate was one
unencumbered by any indebtedness acquired after the conveyance.
The language relied on by the court of appeals to justify
Mr. Allen’s liability for the indebtedness acquired by others
addresses only three forms of debt: the indebtedness that was in
place when he conveyed the property to Ms. Satterfield (it had
been long since paid off), indebtedness incurred by Mr. Allen
after title reverted to him, and indebtedness that he expressly
consented to assume. No indebtedness fell into any of these
categories. It is the nature of the fee simple determinable
property interest created by the terms of the decree of divorce
that defines the scope of Mr. Allen’s post-reversion debt
obligations. Upon the reversion of the property to Mr. Allen, no
indebtedness was owed on it, and thus no debt existed for which
Mr. Allen was responsible. We therefore hold that Mr. Allen’s
title is unencumbered by post-conveyance indebtedness.

9 No. 20050338
IV. WE REMAND TO THE TRIAL COURT FOR CONSIDERATION OF
MR. ALLEN’S UNJUST ENRICHMENT CLAIM AGAINST MR. HALL
¶25 The trial court quieted title in Mr. Hall and,
therefore, had no cause to consider Mr. Allen’s unjust enrichment
claim. The court of appeals reversed the trial court, and we
affirm, thus quieting title in Mr. Allen. We now must remand for
consideration of Mr. Allen’s unjust enrichment claims as we lack
the evidence to rule on this issue.
¶26 Both parties point to a three-element test for unjust
enrichment, which is taken from Desert Miriah, Inc. v. B&L Auto,
Inc., 2000 UT 83, ¶ 13, 12 P.3d 580. First, there must be a
benefit conferred by one person on another. Second, the conferee
must appreciate or have knowledge of the benefit. Third, there
must be acceptance or retention by the conferee of the benefit
under such circumstances as to make it inequitable for the
conferee to retain the benefit without payment of its value.
These are factual elements and have not been briefed by the
parties and as such cannot be determined by this court.
The facts underlying unjust enrichment claims
vary greatly from case to case, and the
doctrine of unjust enrichment was
specifically developed to address situations
that did not fit within a particular legal
standard but which nonetheless merited
judicial intervention. An appellate court’s
ability to clearly articulate
outcome-determinative factors in unjust
enrichment cases “remains elusive,” and thus
favors granting the trial court broad
discretion.
Id. ¶ 12.
CONCLUSION
¶27 We quiet title to this property in Mr. Allen. As
Ms. Satterfield passed no security interest down the chain of
title which survived the determining event and Mr. Hall lacked
the power to create any interest binding against Mr. Allen, the
property returns to Mr. Allen in fee simple absolute and clear of
any debt held by the parties to this action. We are obliged to
call attention to the fact that we have not considered the effect
of the term of the divorce decree which calls for the sale of and
division of the equity obtained from the property. Finally, as
the trial court had no reason to consider Mr. Allen’s unjust

No. 20050338 10
enrichment claim at trial, it is appropriate to remand the case
to the trial court for disposition consistent with this opinion.
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¶28 Chief Justice Durham, Associate Chief Justice Wilkins,
Justice Durrant, and Judge Shumate concur in Justice Nehring’s
opinion.
¶29 Having disqualified herself, Justice Parrish does not
participate herein; District Judge James L. Shumate sat.