Pillsbury v. Butler

NOTICE: NOT FOR OFFICIAL PUBLICATION.
UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL
AND MAY BE CITED ONLY AS AUTHORIZED BY RULE.

IN THE
ARIZONA COURT OF APPEALS
DIVISION ONE

LESLEY PILLSBURY, Plaintiff/Appellant/Cross-Appellee,

v.

WILLIAM FORNEY BUTLER, Defendant/Appellee/Cross-Appellant.

No. 1 CA-CV 20-0187
FILED 03-25-2021

Appeal from the Superior Court in Maricopa County
No. CV2019-001762
The Honorable Pamela S. Gates, Judge

AFFIRMED

COUNSEL

Alexander R. Arpad, Phoenix
Co-Counsel for Plaintiff/Appellant/Cross-Appellee

Byrl R. Lane, Phoenix
Co-Counsel for Plaintiff/Appellant/Cross-Appellee

Udall Shumway PLC, Mesa
By Joel E. Sannes, Carson T.H. Emmons
Counsel for Defendant/Appellee/Cross-Appellant
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Decision of the Court

MEMORANDUM DECISION

Judge Jennifer B. Campbell delivered the decision of the Court, in which
Presiding Judge D. Steven Williams and Judge James B. Morse Jr. joined.

C A M P B E L L, Judge:

¶1 Lesley Pillsbury appeals the grant of summary judgment
dismissing her contract claims against William Forney Butler. Both
Pillsbury and Butler appeal the judgment determining Pillsbury’s interest
in two properties held as tenants in common. Pillsbury also appeals the
denial of her motion to amend to add a fraud claim, and Butler cross-
appeals the denial of attorneys’ fees. We affirm.

BACKGROUND

¶2 Pillsbury and Butler lived together for over 18 years. They
purchased a home in Gilbert that was ultimately titled to Pillsbury as the
sole owner. Butler works in the home-building industry, and in 2012, he
and Pillsbury moved from Gilbert into a house on 53rd Way in one of
Butler’s developments in Cave Creek. After the Gilbert property sold,
Pillsbury paid Butler $65,000 towards the purchase of the 53rd Way home.
The parties initially took title as joint tenants with right of survivorship but
later changed the title to a tenancy in common. Butler signed a beneficiary
deed granting his interest in the property to Pillsbury upon his death, and
Pillsbury named her adult son as the beneficiary of her interest in the
property upon her death.

¶3 In 2017, the parties moved into another home on 27th Street
in Cave Creek and put the 53rd Way property up for sale. They took title to
the 27th Street property as tenants in common and signed beneficiary deeds
like those for the 53rd Way property. The 53rd Way property sold in March
of 2019, and proceeds of $501,530.72 are being held in escrow.

¶4 After the parties ended their relationship, Pillsbury sued
Butler alleging breach of contract, breach of the covenant of good faith and
fair dealing, and unjust enrichment for failing to honor purported oral
agreements. She claimed she was entitled to 50% of the proceeds from the
53rd Way property, 100% of the 27th Street property, and either $2,000 in
monthly support payments or $504,000 from Butler. She claimed Butler was
unjustly enriched because she paid the parties’ living expenses throughout

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their relationship and did not receive the properties or the promised $2,000
monthly payments. Butler counterclaimed, asking for a judicial
determination as to the parties’ ownership interests in the properties and
their proceeds. He also sought to partition the 27th Street property through
a sale and divide the proceeds.

¶5 Butler moved for summary judgment, which the superior
court granted in part, finding the alleged oral agreements were
unenforceable under the statute of frauds but that a question of fact
precluded summary judgment on Pillsbury’s unjust-enrichment claim. The
court also found that questions of fact regarding Pillsbury’s interest in the
53rd Way property precluded summary judgment on Butler’s declaratory-
judgment claim. The court later denied Pillsbury’s request for a jury trial on
the remaining claim and counterclaims.

¶6 At the conclusion of the ensuing bench trial, the court rejected
the unjust-enrichment claim, finding Pillsbury had no reasonable
expectation she would be reimbursed for living expenses and that Butler
also paid some expenses. The court found the parties intended to hold both
properties jointly, each owning a one-half interest. The court awarded each
party 50% of the 53rd Way proceeds in escrow. The court also ordered that
when the 27th Street home is sold, the first $501,530.72 of the proceeds will
go to Butler to compensate for his contribution to the acquisition of the
property, and any remaining proceeds will be divided equally between the
parties.

¶7 Additionally, the superior court denied Pillsbury’s motion for
leave to amend the complaint to conform to evidence presented at trial to
add a fraud claim and ordered each party to pay his or her own attorneys’
fees and costs. Pillsbury timely appealed, and Butler timely cross-appealed.

DISCUSSION

I. The Superior Court Properly Granted Summary Judgment to
Butler on Pillsbury’s Contract Claims.

¶8 Pillsbury alleged Butler breached oral agreements. On
summary judgment, the parties hotly contested whether they had made
such agreements and, if so, the terms of those agreements. The superior
court held that the statute of frauds barred enforcement of each of the
alleged contracts. We review the grant of summary judgment de novo,
considering the facts and any inferences drawn from those facts in the light
most favorable to the party opposing the motion. Tierra Ranchos Homeowners
Ass’n v. Kitchukov, 216 Ariz. 195, 199, ¶ 15 (App. 2007). Summary judgment

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is appropriate “if the facts produced in support of the claim or defense have
so little probative value, given the quantum of evidence required, that
reasonable people could not agree with the conclusion advanced by the
proponent of the claim or defense.” Orme School v. Reeves, 166 Ariz. 301, 309
(1990); Ariz. R. Civ. P. 56(a).

¶9 The statute of frauds bars any action on an oral agreement
that cannot be performed within one year. A.R.S. § 44-101(5). Pillsbury
alleged Butler made an oral promise to pay her $2,000 per month through
2039. Because that alleged promise could not be performed within one year,
the court correctly granted summary judgment against Pillsbury on that
claim.

¶10 The statute of frauds also bars any action “on oral contracts
for the conveyance of land.” Owens v. M.E. Schepp Ltd. P’ship, 218 Ariz. 222,
225, ¶ 14 (2008); A.R.S. § 44-101(6). Pillsbury alleged Butler had orally
agreed that the 53rd Way home would be hers and that after that home sold,
she would own all of the 27th Street home in exchange for relinquishing her
interest in the 53rd Way home. The deed for the 27th Street home
contradicts Pillsbury’s assertion that she owned 100% of that property.
Moreover, although Pillsbury claims the 53rd Way deed is consistent with
the alleged oral agreement that she had a 50% interest in that home, the
deed alone does not establish that Pillsbury was entitled to a 50% interest
in 53rd Way and, thus, does not satisfy the statute of frauds. Although it
was in writing, signed by both parties, and described the property, see
A.R.S. § 44-101, tenants in common do not presumptively take an equal
ownership interest. See Becchelli v. Becchelli, 109 Ariz. 229, 232 (1973),
superseded by statute on other grounds, A.R.S. § 25-318, as recognized in Jordan
v. Jordan, 132 Ariz. 38, 39 (1982); Register v. Coleman, 130 Ariz. 9, 12 (1981)
(holding joint tenancy deed failed to contain alleged additional terms and
conditions of an oral agreement and therefore did not satisfy statute of
frauds).

¶11 Pillsbury also argues questions of fact remained regarding
her part-performance defense to the statute of frauds. The part-
performance defense applies, however, only if the parties’ acts are
“inconsistent with all other explanations.” See Owens, 218 Ariz. at 227, ¶ 18
(“If the alleged acts do not conclusively establish that a contract exists,
reliance upon them would circumvent the evidentiary function of the
statute [of frauds].”); see also William Henry Brophy Coll. v. Tovar, 127 Ariz.
191, 194 (App. 1980) (“[T]he part performance alleged must be
unequivocally referable solely to the oral contract.”). Deciding whether
conduct is “sufficient to constitute part performance is a question of law.”

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Roe v. Austin, 246 Ariz. 21, 25, ¶ 9 (App. 2018) (citing William Henry Brophy
Coll., 127 Ariz. at 194).

¶12 According to Pillsbury, the parties partly performed the oral
agreements when (1) she paid and Butler accepted $65,000 towards the
purchase of the 53rd Way property; (2) she entered into a 20-year solar
panel lease in her own name; (3) she paid the party’s living expenses
through July 2019 even though she had far less financial means than Butler;
and (4) Butler not only told her, but also told others that the 27th Street
property was Pillsbury’s and that he had made arrangements so she could
afford to keep it. However, these actions and statements also would be
consistent with an agreement that Pillsbury owned an interest
proportionate to her $65,000 contribution or that she would take the
properties upon Butler’s death, which is also consistent with the tenants in
common and the beneficiary deeds.

¶13 Pillsbury contends that her part performance can be viewed
as consistent with the oral agreement she alleged and not, as the court
found, consistent with two people cohabitating in a romantic relationship.
But the relevant inquiry is whether the acts can only be explained by the
existence of the oral agreements Pillsbury claims, i.e., 50% ownership of
53rd Way property, 100% ownership of 27th Street property, and payments
of $2,000 per month until 2039 if the parties split up. See Roe, 246 Ariz. at 25,
¶ 11; Owens, 218 Ariz. at 226–27, ¶¶ 16, 18. Whether one explanation is more
persuasive is irrelevant. Roe, 246 Ariz. at 25–26, ¶¶ 11–12; Owens, 218 Ariz.
at 228, ¶ 23. Pillsbury did not show that the parties’ actions are consistent
only with the alleged oral agreements. Therefore, we affirm summary
judgment in Butler’s favor on the contract claims.

II. The Parties Shared Equal Ownership of Both Properties and Butler
Is Entitled to Reimbursement of the 27th Street Purchase Money.

¶14 The superior court held a bench trial on Pillsbury’s claim for
unjust enrichment, and on Butler’s counterclaims for declaratory judgment
and partition. Pillsbury does not appeal the judgment against her on her
claim for unjust enrichment. Although she argued that the superior court
erred by failing to have a jury decide factual issues raised by Butler’s
counterclaims, at oral argument, both parties agreed we need not decide
that issue.

¶15 Because this case was tried to the bench, we review the trial
court’s findings for clear error and will affirm if the court’s decision is
supported by any substantial evidence. Castro v. Ballasteros-Suarez, 222 Ariz.

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48, 51–52, ¶ 11 (App. 2009). This court “defer[s] to the trial court with
respect to any factual findings explicitly or implicitly made, affirming them
so long as they are not clearly erroneous, even if substantial conflicting
evidence exists.” John C. Lincoln Hosp. & Health Corp. v. Maricopa County, 208
Ariz. 532, 537, ¶ 10 (App. 2004). We will affirm the trial court’s judgment if
it is correct for any reason. S&S Paving and Constr., Inc. v. Berkley Reg’l Ins.
Co., 239 Ariz. 512, 514, ¶ 7 (App. 2016).

¶16 In ruling on Butler’s declaratory judgment and partition
claims, the court determined that the parties shared equal ownership of
both properties and that they both intended to use the proceeds from the
sale of the 53rd Way home to repay Butler for purchasing the 27th Street
property. To that end, the court ordered the proceeds from the sale of the
53rd Way home ($501,530.72) held in escrow until the 27th Street home is
sold. Upon sale, the escrowed amount would be divided equally between
the parties and the first $501,530.72 of the sale proceeds from the 27th Street
house would go to Butler to reimburse him for having paid for that home.
Any remainder of the proceeds would be divided equally between the
parties.

¶17 Pillsbury does not dispute the court’s finding that she and
Butler share equal ownership of the two homes. She made that concession
in the findings of fact she submitted to the superior court after trial, in
which she stated that the parties shared equal interests in the properties.
Instead, Pillsbury objects to the order requiring that Butler be reimbursed
$501,530.72 toward the amount that he paid to purchase the 27th Street
home. For his part, Butler does not object to the reimbursement provision
but argues the court’s 50-50 division of interests in the two properties was
not supported by the evidence. He contends that the parties’ respective
shares instead should be determined by their proportionate financial
contribution to the properties. See Becchelli, 109 Ariz. at 232.

¶18 The court’s reimbursement ruling is supported by substantial
evidence. Indeed, Pillsbury’s reply brief concedes that the evidence before
the court could support “the existence of an agreement between the parties
to pay Butler back for the purchase of the second house from the sale
proceeds of the first house.” Pillsbury argues that such an agreement could
not survive the statute of frauds, but she provides no legal authority for the
proposition that an agreement to reimburse another for money paid to
purchase real property is within the statute of frauds. See A.R.S. § 44-101.

¶19 Nor did the superior court err by deciding that the parties
shared equal ownership interests in the two properties. See McCready v.

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McCready, 168 Ariz. 1, 3 (App. 1991) (“The fundamental objective in a
partition action is to divide the property so as to be fair and equitable and
confer no unfair advantage on any of the cotenants.”) (citations omitted).

¶20 Butler argues the court erred by failing to adopt his argument
that the parties’ interests in the two properties should be divided in
proportion to their respective financial contributions to the properties. He
cites Becchelli for the “general rule” that, when one pays for property that is
taken in the name of another, there is a presumption that the property was
taken in trust for the benefit of the one who financed the purchase. 109 Ariz.
at 232. Assuming for purposes of argument that rule might apply here, the
result would merely be a presumption that may be overcome by contrary
evidence. See Restatement (Third) of Trusts § 9(1)(a) & cmts. a, d; see also 76
Am. Jur. 2d Trusts § 149 (2021) (“A purchase-money resulting trust does not
arise, however, if the person who paid the purchase price manifests an
intention that no resulting trust arise.”).

¶21 The evidence before the superior court on this issue certainly
was contradictory. The record showed the parties had modified the deeds
reflecting their respective ownership interests several times before they
settled on tenants in common. Further, Butler signed beneficiary deeds
granting his interest in the homes to Pillsbury upon his death and had
allowed Pillsbury to name her adult son as the beneficiary of her interest in
the properties upon her death. Finally, Butler conceded in a deposition that
he and Pillsbury might own equal shares in the properties, and at trial, he
was unable to articulate what percentage of ownership interests he
understood he and Pillsbury shared.

¶22 The superior court issued its ruling after thoroughly
reviewing the parties’ evidence and hearing two days of testimony. The
court found the parties were equal co-owners of both the 53rd Way and the
27th Street properties. It is undisputed Butler paid the entire purchase price
for the 27th Street property. The court found, and Pillsbury conceded, that
the parties intended that Butler would receive the proceeds of the 53rd Way
home to offset what he paid for the 27th Street home. Consistent with that
finding, the court correctly allocated to Butler the first $501,530.72 from the
sale of the 27th Street property and found that, as equal co-owners of that
home, the parties were to equally split any remaining sale proceeds.

¶23 While the issues at trial were hotly contested, the court’s
rulings are supported by substantial evidence including the deeds and the
parties’ respective testimony. Although Butler argues that the court
adopted a position for which neither party advocated, we cannot conclude

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that the court erred when it chose not to fully accept either party’s view of
the facts.

III. The Superior Court Properly Denied the Motion to Amend.

¶24 Immediately after trial, Pillsbury asked to amend the
complaint to add a fraud claim based on the evidence at trial. See Ariz. R.
Civ. P. 15(b)(2). She argued that Butler testified at trial that he never
intended to go through with his promise to revise his estate plan to provide
Pillsbury $2,000 per month, thus establishing his intent for purposes of
fraud. The superior court denied leave to amend, finding the issue was not
tried by implied consent and, alternatively, that the evidence did not
support a fraud claim. We affirm the denial of leave to amend absent an
abuse of discretion. MacCollum v. Perkinson, 185 Ariz. 179, 185 (App. 1996).

¶25 Contrary to Pillsbury’s argument, Butler did not expressly
consent to try a fraud claim. Nor can Butler’s consent be implied by his
testimony because the evidence Pillsbury cites was also relevant to the
unjust-enrichment claim. “[P]ermitting evidence relevant to an existing
issue to be admitted without objection does not constitute ‘implied consent’
to trial of an issue which has not been raised.” Magma Copper Co. v. Indus.
Comm’n of Ariz., 139 Ariz. 38, 47 (1983); see also Bujanda v. Montgomery Ward
& Co., Inc., 125 Ariz. 314, 316 (App. 1980) (consent cannot be implied “by
admission without objection of evidence relevant to an issue within the
pleadings”). We affirm the denial of the motion to amend the complaint.

IV. Attorneys’ Fees and Costs.

¶26 Both parties requested attorneys’ fees and costs prior to
trial—Butler under A.R.S. §§ 12-341 and -341.01; Pillsbury without citing a
relevant statute. The superior court denied them without comment. Butler
argues on cross appeal that the court erred by failing to state its reasons for
denying fees and that awarding him costs was mandatory.

¶27 “In any contested action arising out of a contract, express or
implied, the court may award the successful party reasonable attorney fees.”
A.R.S. § 12-341.01(A) (emphasis added). “The decision as to who is the
successful party for purposes of awarding attorneys’ fees is within the sole
discretion of the trial court, and will not be disturbed on appeal if any
reasonable basis exists for it.” Sanborn v. Brooker & Wake Prop. Mgmt., Inc.,
178 Ariz. 425, 430 (App. 1994). Additionally, “we will affirm the trial court’s
decision if it is correct for any reason.” Rancho Pescado, Inc. v. Nw. Mut. Life
Ins. Co., 140 Ariz. 174, 178 (App. 1984). “The successful party to a civil action

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shall recover from his adversary all costs expended or incurred therein
unless otherwise provided by law.” A.R.S. § 12-341 (emphasis added).

¶28 As indicated above, the award of attorneys’ fees under A.R.S.
§ 12-341.01(A) is discretionary. Although the superior court offered no
explanation for its denial of fees, the record clearly indicates that the
contested issues were resolved both for and against each party with neither
clearly prevailing. We therefore affirm the court’s denial of attorneys’ fees.

¶29 Butler also contends that Pillsbury rejected a written
settlement offer that was better than the award she received at trial, making
him the prevailing party as a matter of law. A.R.S. § 12-341.01(A). However,
Butler conceded there is no confirmation in the record of his settlement
offers to Pillsbury. Additionally, he filed no offer of judgment. See Ariz. R.
Civ. P. 68. Absent any record of the rejected settlement offers, we cannot
say that Butler was the prevailing party as a matter of law or that the court
erred by denying him costs.

¶30 Because neither party has clearly prevailed on appeal, we
deny both parties appellate fees and costs.

CONCLUSION

¶31 For the foregoing reasons, we affirm.

AMY M. WOOD • Clerk of the Court
FILED: HB

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