Samir M. Shams v. Sona Hassan

IN THE COURT OF APPEALS OF IOWA

No. 18-2158
Filed January 9, 2020

SAMIR M. SHAMS,
Plaintiff-Appellant,

vs.

SONA HASSAN,
Defendant-Appellee.
________________________________________________________________

Appeal from the Iowa District Court for Polk County, Sarah E. Crane, Judge.

Samir Shams appeals the order dismissing his claims of conversion, breach

of contract, and breach of fiduciary duty against Sona Hassan following a bench

trial. AFFIRMED.

Kenneth J. Weiland Jr. of Weiland Law Firm, Des Moines, for appellant.

Steven C. Reed of Law Offices of Steven C. Reed, West Des Moines, for

appellee.

Considered by Doyle, P.J., Potterfield, S.J.*, and Carr, S.J.*

*Senior judges assigned by order pursuant to Iowa Code section 602.9206

(2020).
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CARR, Senior Judge.

Samir Shams appeals the dismissal of his claims against Sona Hassan.

Shams alleged Hassan, his sister, misappropriated $271,773.93 from a checking

account he entrusted her with to provide for his children and pay his bills while he

worked in Iraq from 2004 to 2006.1 The district court dismissed the claims after

finding his breach-of-fiduciary-duty claim was barred by the statute of limitations

and Shams failed his burden of proving conversion and breach of contract.

This action began in 2011. The district court dismissed Shams’s petition for

lack of personal jurisdiction, but the Iowa Supreme Court reversed. See Shams v.

Hassan, 829 N.W.2d 848, 852 (Iowa 2013). In 2015, a jury awarded Shams

$148,501.60 in damages but found in Hassan’s favor on her defamation

counterclaim, awarding her $29,566.25 in compensatory and punitive damages.

Our supreme court reversed the judgment against Hassan on appeal because the

district court failed to submit a factual dispute on the statute of limitations to the

jury. See Shams v. Hassan, 905 N.W.2d 158, 159 (Iowa 2017). It remanded the

matter for a new trial. See id.

A second trial occurred in September 2018, this time to the bench. The

parties stipulated “that if compensatory damages are to be awarded herein, and

not barred by affirmative defense, the amount shall be $148,501.60,” the amount

awarded by the jury in the first trial. In its ruling, the trial court found that the statute

of limitations barred only Shams’s breach-of-fiduciary-duty claim. But, although

his claims for conversion and breach of contract were not barred, the court

1 Hassan paid Shams $50,000 in 2009, but Shams alleges she refused to return
the remaining balance.
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determined that Shams failed to prove the elements of each by a preponderance

of the evidence.

The parties agree that our review is for correction of errors at law. See

Metro. Prop. & Cas. Ins. Co. v. Auto-Owners Mut. Ins. Co., 924 N.W.2d 833, 839

(Iowa 2019). The trial court’s fact findings have the effect of a special verdict and

are binding on us if supported by substantial evidence. See id. We view the

evidence in the light most favorable to the judgment, liberally construing the trial

court’s findings to uphold it. See id. The question is not whether the evidence

supports a different finding but whether it supports the finding the court made. See

id.

Shams contends the court failed to honor the parties’ stipulation. In his

view, the parties stipulated that he had proved each claim against Hassan and the

only question before the trial court was whether Hassan proved at least one

affirmative defense for each claim. But even if his interpretation of the stipulation

is correct, Shams has failed to preserve error on this claim. Shams states that he

preserved error by filing a timely notice of appeal, but this is insufficient. See

Thomas A. Mayes & Anuradha Vaitheswaran, Error Preservation in Civil Appeals

in Iowa: Perspectives on Present Practice, 55 Drake L. Rev. 39, 48 (2006) (noting

that although reference to filing a timely notice of appeal “is a common statement

in briefs, it is erroneous, for the notice of appeal has nothing to do with error

preservation”). “As a general rule, the error preservation rules require a party to

raise an issue in the trial court and obtain a ruling from the trial court.” Id.; accord

Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002) (“It is a fundamental doctrine

of appellate review that issues must ordinarily be both raised and decided by the
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district court before we will decide them on appeal.”). To preserve error, a party

must alert the district court to the issue at a time when the district court can take

corrective action. See Top of Iowa Coop. v. Sime Farms, Inc., 608 N.W.2d 454,

470 (Iowa 2000). That is because our error preservation rules are “designed to

preserve judicial resources by avoiding proceedings that would have been

rendered unnecessary had an earlier ruling on the issue been made.” Id. Although

Shams claims he could not have obtained a ruling earlier because it did not

become apparent until the judgment was rendered, filing a motion under Iowa Rule

of Civil Procedure 1.904(2) would have alerted the trial court to any error. See

Johnson v. Kaster, 637 N.W.2d 174, 182 (Iowa 2001) (holding landowners failed

to preserve error on a claim that the trial court erred in granting an easement that

substantially increased the burden on their property because they raised the issue

for the first time on appeal rather than request that the trial court enlarge or amend

its findings). Shams failed to do so. A motion under this rule “advise[s] counsel

and the appellate court of the basis of the trial court’s decision in order that counsel

may direct [an] attack upon specific adverse findings or rulings in the event of an

appeal.” Id. (quoting Ritz v. Wapello Cty. Bd. of Supervisors, 595 N.W.2d 786, 789

(Iowa 1999)).

Shams also contends that the trial court placed an unfair burden of proof on

him in proving his conversion claim. The main issue before the trial court was

whether Hassan used the funds as Shams intended and whether she failed to

return the remaining funds to Shams. Shams argues that to succeed on his claim,

the court required him to perform the near impossible task of proving a negative

by showing Hassan did not refund his money and that he had no control over it
5

because of Hassan’s actions. Because he had no access to the accounts in which

Hassan deposited the money, Shams argues that it is unfair to require him to prove

what happened to the money beyond stating Hassan did not return it to him.

In its ruling, the trial court noted the lack of documentary evidence

introduced at trial “due to the time lag between the events at issue and the bench

trial.” For instance, the only exhibit that purported to account for the funds was

Hassan’s response to an interrogatory. Neither party detailed the bank records or

tried to trace the funds. And the trial court noted that some bank records were

unavailable because of how much time had passed. The case therefore rested

largely on “which ‘side of the story’ the court [found] more credible—that of Shams

or that of Hassan.” And on that issue, the court found Hassan presented the more

credible evidence. It noted that Hassan’s son, Emery, testified that Hassan used

the funds to pay tuition and rent for Shams’s children. As we note below, the trial

court credited this evidence. Emery also testified that Hassan converted some

funds to cash, which others brought to Shams in Egypt. In contrast, the court noted

that Shams did not respond to the testimony about whether his children received

money for tuition or rent, and that it did not find his denial that he received cash in

Egypt credible given the other evidence. Noting that Shams bore the burden of

proving Hassan did not spend the funds as he intended, the court refused to

assume, without more, that Hassan converted the funds she deposited into her

account. We find no error.

Shams also challenges the trial court’s finding on Emery’s credibility, but

“[t]he trier of fact—here, the district court—has the prerogative to determine which

evidence is entitled to belief.” See Tim O’Neill Chevrolet, Inc. v. Forristall, 551
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N.W.2d 611, 614 (Iowa 1996). Because it is in a better position to evaluate the

credibility of the witnesses, factual disputes depending heavily on credibility “are

best resolved by the district court.” See id. Although another fact finder may have

concluded differently, substantial evidence supports the court’s conclusion that

Shams failed to prove his claims. Deferring to the trial court’s credibility findings

and applying the standard of review required, we affirm the order dismissing

Shams’s claims against Hassan.

AFFIRMED.