Brenda Zanders v. Richard Baker & Brenda Zanders v. Gordon Thomas
Brenda Zanders v. Richard Baker & Brenda Zanders v. Gordon Thomas
Opinion
*1133 Brenda Zanders and Joseph Reid were in a romantic relationship when Mr. Reid bought a house for Ms. Zanders to reside in, fix up, and make mortgage payments on. He agreed to sell Ms. Zanders the house in a few years, once she improved her financial standing. At the three-year mark, their relationship had ended, but they nonetheless renewed the agreement for another term. By the end of the second three-year period, Mr. Reid had taken out three mortgages on the property, and instead of selling the property to Ms. Zanders, Mr. Reid sold the property to Shirley and Richard Baker. Ms. Zanders sued both Mr. Reid and the Bakers and, during the pendency of the first appeal, the Bakers sold the property to Tina Brower-Thomas and Gordon Thomas. Ms. Zanders added the Thomases as defendants to her lawsuit on remand, where she ultimately failed to prevail on the majority of her claims. All parties involved-Ms. Zanders, the Bakers, and the Thomases-appealed from the trial court's order on various grounds, but the thrust of the various issues now presented is whether Ms. Zanders should get title to the property or compensation from the Bakers and Thomases for depriving her of that title. For the reasons discussed in this opinion, we reverse the trial court's order granting nominal damages for Ms. Zanders but in all other respects affirm.
I. Background
This case comes to us for the second time on appeal with a new host of arguments and a different set of parties. As partially summarized in our first decision,
Zanders v. Reid
,
By the end of the three-year period, Ms. Zanders's relationship with Mr. Reid had ended.
In 2004, at the conclusion of the second three-year term, Ms. Zanders offered to purchase the property from Mr. Reid for $ 190,000.
Months later, Ms. Zanders filed a complaint against Mr. Reid and the Bakers, alleging causes of action for breach of contract, promissory estoppel, fraud, interference with contractual relations, intentional interference with business expectancy, and violation of Ms. Zanders's right of first refusal under TOPA.
The trial court granted the Bakers' motion to strike Ms. Zanders's claims against them and for the entry of judgment in their favor, due to Ms. Zanders's failure to make the rent payments required by the protective order.
On appeal, we held that, though the entry of judgment for the Bakers in their Landlord and Tenant action against Ms. Zanders should stand, the trial court had erred by dismissing Ms. Zanders's claims for fraud and tortious interference with her contractual right to purchase her home from Mr. Reid.
While our decision in the first appeal was pending, the Bakers sold the property to Tina Brower-Thomas and Gordon Thomas. On remand, Ms. Zanders initially filed a complaint against Mr. Reid, the Bakers, and the Thomas parties. 2 Ms. Zanders's *1135 fifth and final amended complaint named only the Bakers and the Thomas parties, requested a declaratory judgment that neither party was a bona fide purchaser of the property, included a claim for a resulting and constructive trust against all parties, and alleged intentional interference with business expectancy and TOPA claims against the Bakers. In addition to monetary damages, Ms. Zanders requested an order setting aside any deed of property issued to the Bakers and an order for specific performance of the agreed upon subject property.
The trial court found that the Bakers and the Thomas parties were estopped and precluded from relitigating whether Ms. Zanders's TOPA rights were violated because each party was in privity with Mr. Reid and that neither party was a bona fide purchaser without notice. It therefore awarded Ms. Zanders nominal damages against the Bakers. The court declined to enter a constructive or resulting trust on the property, found that Ms. Zanders could not prevail on her claim for tortious interference, and denied Ms. Zanders's request for specific performance. In its order denying reconsideration, the trial court further declined to find the Bakers jointly and severally liable for Mr. Reid's TOPA violation or to enter a default judgment for Mr. Reid on the claims alleged against him in the second amended complaint.
On appeal, Ms. Zanders argues on various grounds that the court erred by not entering a default judgment against Mr. Reid, not awarding Ms. Zanders the property, not imposing a constructive and resulting trust, and not finding the Bakers jointly and severally liable for the award against Mr. Reid. The Bakers and the Thomas parties argue that the court erred by finding that they were precluded from arguing that Ms. Zanders's TOPA rights were not violated, and the Thomas parties additionally argue that they should be entitled to attorney's fees. We address these arguments in turn.
II. Discussion
A. Mr. Reid
At the outset, Ms. Zanders argues that the court erred by not allowing her to pursue her various claims against Mr. Reid. Following Ms. Zanders's second amended complaint, a default was entered against Mr. Reid for failing to participate in the case. Ms. Zanders did not move for a default judgment. Instead, she filed a third, fourth, and fifth amended complaint, without naming Mr. Reid as a party. She now contends that because Mr. Reid was mentioned in the pretrial statement following the fifth amended complaint, he is properly included in this suit, and that the trial court should have entered a default judgment against him.
Super. Ct. Civ. R. 55(b)(2) states that no later than "60 days after a default is entered, the party must apply to the court for a default judgment either by motion or praecipe, served on all parties, requesting the setting of an ex parte proof hearing." "An entry of default is simply an interlocutory order, whereas a default judgment is a final judgment that terminates the litigation and decides the dispute."
Arthur v. District of Columbia
,
Here, Ms. Zanders did not include Mr. Reid in her fifth amended complaint. He was not served or otherwise notified of continuing proceedings against him.
See
Threatt v. Winston
,
B. TOPA Claims
Because the jury had found in the first trial that Mr. Reid had violated Ms. Zanders's TOPA rights, the trial court concluded that the doctrines of collateral estoppel and res judicata barred the Bakers and the Thomas parties from challenging that finding. The court further ruled that neither the Bakers nor the Thomas parties were bona fide purchasers without notice, because they had separate bases for knowing of Ms. Zanders's interest in the property and accordingly should have questioned whether she might have rights under the TOPA statute. 4 The court thus declined to grant Ms. Zanders title to or possession of the house, 5 but awarded her nominal damages.
*1137
The Bakers and the Thomas parties contend that they should not have been precluded from arguing that Ms. Zanders's TOPA rights were not, in fact, violated, because she failed to provide a written statement of interest to Mr. Reid within 30 days, as required by
In 2010-following our decision in
Zanders I
and before Ms. Zanders filed her final amended complaint-we confirmed that in order to comply with the TOPA statement-of-interest requirement, a tenant was required to ensure that the notice
reached
the owner in 30 days, not to deposit the notice in the mail within 30 days.
Tippett v. Daly
,
We conclude that the trial court erred by finding that the Bakers and the Thomas parties were precluded and estopped from arguing that Ms. Zanders's TOPA rights were not violated as clarified under Tippett v. Daly , because neither party was in privity with Mr. Reid.
Collateral estoppel "renders conclusive in the same or a subsequent action determination of an issue of fact or law when (1) the issue is actually litigated and (2) determined by a valid, final judgment on the merits; (3) after a full and fair opportunity for litigation by the parties or their privies; (4) under circumstances where the determination was essential to the judgment, and not merely dictum."
Modiri v. 1342 Rest. Grp., Inc.
,
*1138
Shin v. Portals Confederation Corp.
,
"A privy is one so identified in interest with a party to the former litigation that he or she represents precisely the same legal right in respect to the subject matter of the case."
Modiri
,
Here, Mr. Reid sold the Bakers the property before Ms. Zanders initiated her action. She filed her TOPA claim against only Mr. Reid, who no longer had title at the time, and the Bakers were dismissed from the case and precluded from influencing the outcome of the TOPA issue at trial. At the time the first suit was filed, the Thomas parties were not even associated with the property. They did not take title from the Bakers until after the jury verdict in the first trial, from which the Bakers had been dismissed. 8 As a result, the *1139 trial court erred in finding that the Bakers and Thomas parties were in privity with Mr. Reid as to the TOPA claim adjudicated against him.
Claim preclusion does not apply for the additional reason that the question whether Ms. Zanders had complied with the statutory statement-of-interest requirement was not actually litigated and decided in the first trial.
See
Smith
,
At the end of trial, the jury received an instruction stating that in order to comply with TOPA, the tenant was required, upon receipt of sale, to provide the landlord within 30 days a notice of interest. Ms. Zanders argues that because the jury had already considered this argument and found that Ms. Zanders had complied with the statute, the issue has been previously litigated and decided. But there is no indication that Ms. Zanders's compliance with this statute was actually put in issue during the trial.
See
Paley v. Estate of Ogus
,
Because the parties were not in privity with Mr. Reid, and because the issue of Ms. Zanders's compliance with the statement-of-interest requirement was not previously litigated, the trial court erred in concluding that Ms. Zanders was entitled to nominal damages. The relevant facts are uncontested-Ms. Zanders did not deliver her statement of interest in the property to Mr. Reid within 30 days of receiving the written offer of sale as required by the statute in force at the time. Under
Tippett v. Daly
, Ms. Zanders was required to ensure that Mr. Reid actually received her statement within 30 days.
Ms. Zanders's argument that the holding in
Tippett
should not apply because the decision had not been issued at the time of original sale is unavailing. As Ms. Zanders herself notes, "judicial decisions interpreting statutes are 'given full retroactive effect in all cases still open on direct review and as to all events, regardless of whether such events predate or postdate our announcement of the rule.' "
Ross v. District of Columbia Dep't of Emp't Servs.
,
For these reasons, it was error for the trial court to preclude the Bakers and Thomas parties from arguing that Ms. Zanders had failed to comply with
C. Resulting and Constructive Trusts
Ms. Zanders next argues that the trial court erred in declining to impose both a resulting and constructive trust as an equitable remedy for unjust enrichment.
9
"A resulting trust is a property relationship designed to effectuate the parties' intent when one party takes title to property for which another has furnished the consideration."
Edwards v. Woods
,
We review a court's findings as to the intent of the parties for clear error.
See
Edwards
,
A constructive trust is likewise a remedy for combatting unjust enrichment, and "arises where a person who holds title to property is subject to an equitable duty to convey it to another on the ground that he would be unjustly enriched if permitted to retain such interest."
Gray v. Gray
,
As we noted in
Zanders I
, Ms. Zanders had a potential claim for the imposition of a constructive trust against Mr. Reid, which she was free to pursue on remand.
Ms. Zanders argues that her case is most analogous to
Porter v. Zuromski
,
The key distinction between Ms. Zanders's case and
Porter
is that the defendant in
Porter
was a party to the initial oral agreement.
D. Attorney's Fees
Finally, the Thomas parties argue that the trial court erred by denying their motion for an award of attorney's fees, pursuant to
As the trial court noted, although Ms. Zanders had not prevailed in the Landlord and Tenant action, "[j]udgment for possession based on non-payment of a protective order does not have collateral estoppel effect."
Mullin v. N St. Follies Ltd.
,
III. Conclusion
For the foregoing reasons, we reverse the trial court's award of nominal damages to Ms. Zanders but otherwise affirm the judgment of the Superior Court.
So ordered.
Along with Ms. Brower-Thomas and Mr. Thomas, Ms. Zanders named Suntrust Mortgage, Inc., and Richard Lash, the trustee of the Deed of Trust for the property.
Ms. Zanders relies on
Pellerin v. 1915 16th Street, N.W., Co-op Ass'n
,
The Bakers argue that the trial court erred by concluding that they were not bona fide purchasers without notice. Specifically, they contend that it was irrelevant whether they knew that Ms. Zanders was residing in the property and making mortgage payments, because they did all they could be expected to do to feel comfortable that Mr. Reid had complied with TOPA prior to the sale. That the Bakers were aware of Ms. Zanders's expressed belief, through her actions and statement of interest (whether timely delivered or not), that she may have some claim to the property justifies the trial court's finding that they were in fact on notice.
See
Clay Props., Inc. v. Wash. Post Co.
,
The trial court decided not to award specific performance on the ground that Ms. Zanders had not established that she was "ready, willing, and able" to purchase the property. Ms. Zanders contests this finding on appeal, but because we conclude that the trial court erred in estopping the Bakers and the Thomas parties from rebutting Ms. Zanders's TOPA claim, we need not reach this issue. For the same reason-among other bases provided by the trial court-we also conclude that the Bakers and Thomas parties were not jointly and severally liable for the damages awarded in compensation for Mr. Reid's TOPA violation.
This statute was subsequently amended by D.C. Law 17-234, D.C. Law 18-193, and D.C. Law 22-120. The most recent amendment exempted single-family accommodations from TOPA coverage, except for those with elderly tenants or tenants with disabilities. Those tenants now have 20 days to deliver a written statement of interest.
Res judicata is more applicable where there is a second action than it is to claims arising within the same action.
See
Calomiris v. Calomiris
,
On occasion, courts have found that a successor in interest may be bound by a judgment where the property is transferred while an action is still pending.
See
Bank of Am., N.A. v. Griffin
,
In her brief on appeal, Ms. Zanders does not specify on what proceeds or property the court should have imposed a trust. She focuses her argument primarily on the alleged misconduct of Mr. Reid, without mention of the Bakers or the Thomas parties. Because she explicitly challenges the trial court's ruling on these issues as to counts alleged against all parties, however, we review the trial court's findings for error as to each party.
Ms. Zanders acknowledges this finding by the trial court in the section of her brief that challenges the court's conclusion that she did not satisfy the elements of tortious interference with a business interest. But instead of challenging the finding, she argues that the relevant fact for her tortious interference claim was that the Bakers were on inquiry notice when they purchased the property.
To establish a claim for intentional interference with business relations-or tortious interference-a plaintiff must establish, among other things, the "existence of a valid contractual or other business relationship" and "the defendant's knowledge of the relationship."
Onyeoziri v. Spivok
,
Another notable difference between Ms. Zanders's case and Porter is that in Porter , the plaintiff moved in and began making mortgage and other payments under the assumption that she was a joint owner of the property, when in fact, because of the defendant's misrepresentations, she was not. In contrast, Ms. Zanders made improvements to the property as a tenant, with the agreement that if she obtained the requisite financing, she might obtain the property from Mr. Reid. This distinction lends further support to the trial court's conclusion that there was "no basis on this record for a finding of mistake of fact, fraud, undue influence, or breach of fiduciary duty," and that Ms. Zanders was thus not entitled to a constructive trust.
Because we affirm the trial court's order declining to impose a constructive trust, we do not address the Bakers' laches defense.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.