RENDERED: APRIL 2, 2021; 10:00 A.M.
TO BE PUBLISHED
Commonwealth of Kentucky
Court of Appeals
NO. 2020-CA-0152-MR
STUART WAYNE WRIGHT APPELLANT
APPEAL FROM BULLITT CIRCUIT COURT
v. HONORABLE RODNEY BURRESS, JUDGE
ACTION NO. 19-CI-00326
FRANK L. MILLER APPELLEE
OPINION
AFFIRMING
** ** ** ** **
BEFORE: CLAYTON, CHIEF JUDGE; GOODWINE AND KRAMER,
JUDGES.
CLAYTON, CHIEF JUDGE: Appellant, Stuart Wayne Wright, appeals the Bullitt
Circuit Court’s order granting summary judgment to Appellee, Frank L. Miller.
For the following reasons, we affirm.
BACKGROUND
This case involves the ownership of a 1973 Glen house trailer with
Vehicle Identification Number SN26L204ES1906 (hereinafter, “manufactured
home”)1 located on real property owned by Wright. Miller has title to the
manufactured home, but Wright claims the manufactured home is affixed to his
real property and, thus, he owns it.
The manufactured home at issue was made in 1973. It was then
transported to the real property at issue and placed on a foundation.
In 2001, Phillip and Sara Squires purchased the real property and
acquired the title to the manufactured home. To finance the purchase, the Squires
obtained a mortgage in 2001 and again in 2003. Wright claims the Squires’
mortgages included the manufactured home because the mortgages included “all
improvements” on the property, while Miller claims the mortgages were silent as
to the inclusion of the manufactured home. Regardless, in 2012, the Squires failed
1
Wright refers to the 1973 Glen house trailer as a “manufactured home,” while Miller refers to it
as a “house trailer.” A “manufactured home” refers to a dwelling built to conform to the
National Manufactured Housing Construction and Safety Standards Act of 1974, under which
the United States Department of Housing and Urban Development (HUD) promulgated certain
regulations. The 1973 Glen house trailer was built before the HUD regulations took effect.
However, the term “mobile home” (also referred to as a “house trailer”) has been replaced by the
term “manufactured home” under Kentucky law. See Kentucky Revised Statutes (KRS) 186.650
(amended, effective July 15, 1994, to substitute the term “manufactured home” for the term
“mobile home” in KRS Chapters 186 and 186A); see also 53A AM. JUR. 2D Mobile Homes and
Trailer Parks § 7, n.7 (2021) (citing 42 United States Code Annotated §§ 5401, et seq. as
amended by United States Public Law (Pub. L.) No. 96-399, § 308(c)(4) and Pub. L. No. 97-35,
§ 339B(c)).
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to make their mortgage payments and foreclosure proceedings were filed. As a
result, in 2013, the Master Commissioner sold the property to the Federal Home
Loan Mortgage Corporation (FHLMC).
In August 2013, FHLMC sold the property to Wright. The purchase
contract between FHLMC and Wright specifically disclosed that, although a
manufactured home sat upon the property, FHLMC did not have title to it:
[Wright] agrees and acknowledges that [FHLMC] has
been unable to obtain title to the Home, and that evidence
of title and title insurance, including an ALTA 7
Endorsement,2 may not be available nor issued on the
Home. Notwithstanding the foregoing, [Wright] is still
desirous of purchasing the Property.
Shortly after Wright purchased the property, on August 28, 2013, the
Squires obtained a duplicate certificate of title3 to the manufactured home from the
Kentucky Transportation Cabinet (KTC). Then, on September 3, 2013, the Squires
transferred that title and, thus, ownership of the manufactured home to Miller.
Neither party mentions what, if anything, transpired between 2013
and 2019, when Wright filed the underlying action against Miller. However,
2
“ALTA” stands for American Land Title Association. An ALTA 7 Endorsement is issued by a
title insurance company regarding whether a manufactured home situated on the insured land is
included in the policy definition of “land.”
3
Pursuant to KRS 186A.245(1), “[i]f a certificate of title is lost, stolen, mutilated, or destroyed
or becomes illegible, the owner or legal representative of the owner named in the certificate shall
promptly make application to the county clerk for and may obtain a duplicate, upon furnishing
information satisfactory to the Department of Vehicle Regulation.”
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Wright’s complaint alleges that, even though he bought the real property, Miller
claimed he had a right to evict him from the manufactured home that sits upon that
real property. In his lawsuit, Wright requested the circuit court to quiet title to the
manufactured home.
After answering discovery, Miller moved for summary judgment.
Miller claimed that a manufactured home remains personal property until
converted into real property using the statutory procedure set forth in KRS
186A.297. And, because the manufactured home was never converted to real
property, Miller argued he had title to the manufactured home and owned it as
personal property.
On January 8, 2020, the circuit court granted summary judgment to
Miller. The circuit court held that Wright had not produced any evidence that the
previous owner of the manufactured home executed and filed an affidavit of
conversion to real estate with the county clerk as set forth in KRS 186A.297(1).
Therefore, the manufactured home remained personal property and did not transfer
to Wright when he purchased the real property.
This appeal followed.
STANDARD OF REVIEW
The standard of review for an appeal of a summary judgment is
“whether the trial court correctly found that there were no genuine issues as to any
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material fact and that the moving party was entitled to judgment as a matter of
law.” Scifres v. Kraft, 916 S.W.2d 779, 781 (Ky. App. 1996); Kentucky Rules of
Civil Procedure (CR) 56.03. The trial court must view the record “in a light most
favorable to the party opposing the motion for summary judgment and all doubts
are to be resolved in his favor.” Steelvest, Inc. v. Scansteel Service Center, Inc.,
807 S.W.2d 476, 480 (Ky. 1991). Further, “a party opposing a properly supported
summary judgment motion cannot defeat it without presenting at least some
affirmative evidence showing that there is a genuine issue of material fact for
trial.” Id. at 482. “An appellate court need not defer to the trial court’s decision on
summary judgment and will review the issue de novo because only legal questions
and no factual findings are involved.” Hallahan v. The Courier-Journal, 138
S.W.3d 699, 705 (Ky. App. 2004).
ANALYSIS
Manufactured homes and real property have a unique relationship. Is
the manufactured home part of the real property upon which it sits or is the
manufactured home personal property? If the manufactured home is personal
property, how does it become real property?
Under Kentucky law, a manufactured home is considered personal
property, and its title is registered with the KTC in the same fashion as a car or a
boat. A manufactured home remains personal property unless it is transformed
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into part of the real property upon which it sits. So, if a person owns a parcel of
land and owns a manufactured home located on that land, she owns two separate
property interests: one in real property (the land) and the other in personal
property (the manufactured home). If this owner were to sell the land, title to the
manufactured home does not transfer to the new owner through the deed. The
manufactured home must first be converted into real property.
Kentucky law provides the procedure for converting a manufactured
home into real property. Under KRS 186A.297(1), “the owner may execute and
file an affidavit of conversion to real estate with the county clerk of the county in
which the real estate is located.” In the affidavit, the owner “shall attest to the fact
that the home has been or will be permanently affixed to the real estate and be
accompanied by a surrender of the Kentucky certificate of title.” Id. Finally,
“[t]he county clerk shall file the affidavit of conversion to real estate in the
miscellaneous record book.” Id.
Once the affidavit of conversion to real estate and the surrender of
title is filed, the manufactured home “shall be deemed” “as an improvement to the
real estate upon which it is located.” KRS 186A.297(2); see Bowling v.
Appalachian Federal Credit Union, 515 S.W.3d 686, 689 (Ky. App. 2017). The
property valuation administrator is furnished with a copy of the affidavit of
conversion to real estate “for inclusion in the real property tax rolls of the county.”
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KRS 186A.297(2). Notably, if any unreleased lien is displayed on the certificate
of title, the county clerk “shall not accept a surrender” of the title “unless it is
accompanied by a release of the lien.” Id.
For his appeal, Wright claims the circuit court erred in granting
summary judgment to Miller because: (1) he has an ownership interest in the
manufactured home because it is a permanent fixture on the land he purchased; (2)
he should not have had to produce evidence that the manufactured home was
converted into real property; (3) he did not have an opportunity to fully conduct
discovery; and (4) the circuit court did not consider the “unclean hands doctrine.”
For his first claim of error, Wright claims the manufactured home was
affixed to the property as early as 1995 because its title history reflects that Lillian
Parrish was the owner at that time and her “title status” was listed as “no title.”
Thus, he argues the manufactured home was already a fixture on the real property
by 1995 and when the Squires purchased the property in 2001, the deed transferred
both the manufactured home and the real property. Wright claims KRS
381.200(1), which provides that “[e]very deed, unless an exception is made
therein, shall be construed to include all buildings, privileges and appurtenances of
every kind attached to the lands therein conveyed[,]” supports his argument that
the Squires’ deed included the attached manufactured home. Moreover, Wright
asserts that the Squires’ mortgages must have included the manufactured home due
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to the amount of money they borrowed for the property and the Squires’ certificate
of title was meaningless. Finally, Wright contends that KRS 186A.297, which the
circuit court relied upon to hold that the manufactured home was never converted
to real property, does not control because it did not become effective until 2000,
which was after the manufactured home was already affixed to the land.
In response, Miller argues the manufactured home was not converted
into real property under either KRS 186A.297 or the prior common law. The title
history reflects that the Squires acquired title to the manufactured home on June 8,
2001. They also had a duplicate title issued on August 28, 2013. This proves that
the manufactured home remained personal property with a title when the Squires
purchased the land in 2001 and after the foreclosure in 2013. Also, Miller
contends that the amount paid by the Squires does not prove that the manufactured
home was included in their mortgages. Finally, Miller claims the Squires’
mortgages were silent as to the manufactured home, which indicates it was not
included therein.
As explained, simply because a manufactured home is located on real
property does not mean the manufactured home is a permanent fixture or part of
that real property. Unless the statutory procedure set forth in KRS 186A.297 is
followed, the manufactured home remains personal property and is separate from
the real property upon which it sits. Bowling, 515 S.W.3d at 688 (holding “a
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manufactured home may become ‘permanently affixed’ to real property if the
mandates of KRS 186A.297 are fulfilled.”). Until these steps are taken, case law
holds that the manufactured home remains personal property. Barnette v. Grizzly
Processing, LLC, 809 F. Supp. 2d 636, 649 (E.D. Ky. 2011) (holding owners had
not complied with KRS 186A.297, so manufactured home remained personal
property); Citizens Nat’l Bank of Jessamine County v. Washington Mut. Bank, 309
S.W.3d 792, 796 (Ky. App. 2010) (footnote omitted) (“There is no question that
Reynolds did not comply with the requirements of KRS 186A.297 and, therefore,
the manufactured home remains personal property.”).
While Wright claims the manufactured home was converted into real
property before the Squires purchased the property in 2001, the active certificate of
title proves otherwise. By way of illustration, in the case of In re Starks, No. 10-
22108, 2011 WL 248521 (Bankr. E.D. Ky. Jan. 24, 2011), a federal bankruptcy
court sitting in Kentucky considered whether a manufactured home somehow lost
its character as personal property becoming either part of the real estate or a fixture
and subject to a mortgage. The court held that argument ignored the fact that an
active certificate of title existed for the manufactured home, which had not been
surrendered. Id. at *3-4. The court dismissed the argument that Kentucky’s
version of Article 9 of the Uniform Commercial Code4 rendered the manufactured
4
See KRS 355.9-502.
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home a fixture subject to a mortgage because KRS 186A.297 provides the sole
method for converting a manufactured home to real estate. Id. at *3. Similarly, the
manufactured home at issue in this case did not lose its character as personal
property because an active certificate of title exists, which is held by Miller.
Also, we conclude that Wright’s argument that KRS 186A.297 does
not apply because that statute was enacted in 2000 and after the manufactured
home was affixed to the real property is not supported by Kentucky case law. In
Hiers v. Bank One, West Virginia, Williamson, NA, 946 S.W.2d 196 (Ky. App.
1996), which was decided in 1996, the Court held that with respect to “any
property for which a certificate of title is required by KRS Chapter 186A, a
security interest in that property may be perfected or discharged only by a notation
in that vein on the certificate of title.” Id. at 198. Here, KRS Chapter 186A
required the manufactured home to have a title. KRS 186A.070(1) states that any
“state resident owner” of a manufactured home must obtain a certificate of title.
The title history evidence does not reflect any security interest against the
manufactured home, contrary to Wright’s argument that the manufactured home
was part of the real property that was foreclosed upon when the Squires defaulted
on their mortgages.
Additionally, Wright admitted that his purchase contract with
FHLMC, which bought the property in the foreclosure sale, did not include title to
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the manufactured home. Attached to Wright’s response to summary judgment was
the purchase contract addendum. In that addendum, which Wright signed, he
acknowledged that FHLMC had been unable to obtain title to the manufactured
home located on the real property. Thus, Wright knew the title to the
manufactured home was not included in his purchase.
Because Miller’s certificate of title established that the manufactured
home remained personal property, no genuine issue of material fact existed as to
the ownership of the manufactured home. At that point, the burden shifted to
Wright to present “at least some affirmative evidence” to avoid summary
judgment. Steelvest, 807 S.W.2d at 482. Because Wright was unable to produce
such evidence, we conclude that the circuit court did not err in granting summary
judgment to Miller.
For Wright’s second claim of error, he argues that he should not have
had to produce evidence that the manufactured home had been previously
converted into real property. As stated above, once Miller demonstrated he had
title to the manufactured home, the burden did, indeed, shift to Wright to present
some evidence. Id. Moreover, the circuit court did not hold that Wright had to
produce evidence that the previous owner of the manufactured home executed and
filed an affidavit of conversion to real estate with the county clerk. Instead, the
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circuit court held that Wright had not produced any such evidence. The circuit
court did not err in this conclusion.
For Wright’s third claim of error, he argues he did not have a full
opportunity to conduct discovery before the circuit court granted summary
judgment to Miller. Wright claims Miller objected and did not fully respond to the
discovery he propounded. If Miller had fully responded, Wright claims he would
have received the Squires’ certificate of title, a copy of any affidavit or application
of the Squires to get their duplicate title, and information regarding Miller’s
payment to the Squires for the manufactured home, which could question Miller’s
claim of valid title.
In response, Miller claims that Wright never requested supplemental
discovery responses and never filed a motion to compel regarding the adequacy of
his responses. Miller further claims that Wright only asked for additional time for
discovery in his summary judgment response.
We see no error. Wright does not allege that the circuit court refused
to grant him additional time to conduct discovery. Likewise, the record does not
reflect that Wright requested supplemental discovery or that Wright properly made
a motion to compel a ruling on any of Miller’s objections. “[T]he hope that
something will come to light in additional discovery is not enough to create a
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genuine issue of material fact.” Benningfield v. Pettit Environmental, Inc., 183
S.W.3d 567, 573 (Ky. App. 2005).
The curtain must fall at some time upon the right of a
litigant to make a showing that a genuine issue as to a
material fact does exist. If this were not so, there could
never be a summary judgment since “hope springs
eternal in the human breast.” The hope or bare belief,
like Mr. Micawber’s, that something will “turn up,”
cannot be made basis for showing that a genuine issue as
to a material fact exists.
Neal v. Welker, 426 S.W.2d 476, 479-80 (Ky. 1968) (internal citation omitted).
“‘Belief’ is not evidence and does not create an issue of material fact.” Humana of
Kentucky, Inc. v. Seitz, 796 S.W.2d 1, 3 (Ky. 1990). “A party’s subjective beliefs
about the nature of the evidence is not the sort of affirmative proof required to
avoid summary judgment.” Haugh v. City of Louisville, 242 S.W.3d 683, 686 (Ky.
App. 2007). Wright’s subjective belief that further discovery could have
questioned the validity of Miller’s title to the manufactured home does not create a
genuine issue of material fact to avoid summary judgment.
For Wright’s final claim of error, he argues the circuit court erred by
not considering the “unclean hands doctrine.” Essentially, Wright claims the
Squires obtained the duplicate certificate of title to the manufactured home shortly
after he purchased the real property. Then, they immediately transferred that title
to Miller for an alleged nominal sum. He claims this amounted to unconscionable
conduct.
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In response, Miller claims Wright never produced any evidence of
wrongdoing, let alone wrongdoing sufficient to invoke the “unclean hands
doctrine.” The Squires acquired title to the manufactured home in 2001, at the
time they purchased the real property, and they had a duplicate title issued on
August 23, 2013. Miller asserts that the Squires had the right to sell the
manufactured home to whomever they wanted for whatever amount. Moreover,
Miller claims the “unclean hands doctrine” is an equitable defense the circuit court
did not need to consider to decide Miller’s summary judgment motion.
“Under the ‘unclean hands doctrine,’ a party is precluded from
judicial relief if that party ‘engaged in fraudulent, illegal, or unconscionable
conduct’ in connection ‘with the matter in litigation.’” Mullins v. Picklesimer, 317
S.W.3d 569, 577 (Ky. 2010) (quoting Suter v. Mazyck, 226 S.W.3d 837, 843 (Ky.
App. 2007)). A circuit court’s decision to invoke this equitable defense rests
within its sound discretion. Id.
While Miller may have obtained title to the manufactured home for a
nominal sum and in a time frame that seems unfair or questionable to Wright, the
circuit court was within its discretion not to invoke the equitable defense of the
“unclean hands doctrine.”
Equity is only a supplement to the law for when
there is no remedy at law. But it is a simple tenet that if
there is a statute or case precedent or rule going a certain
way, a trial court may not depart from it on the basis of
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equity. Law trumps equity.
Bell v. Commonwealth, Cabinet for Health and Family Services, Dep’t for
Community Based Services., 423 S.W.3d 742, 747-48 (Ky. 2014) (emphasis in
original). Here, the circuit court made a ruling based on KRS 186A.297 and
Kentucky precedent. The circuit court was within its discretion not to consider the
“unclean hands doctrine” when it granted summary judgment to Miller.
CONCLUSION
For the foregoing reasons, we affirm the order granting summary
judgment to Miller.
ALL CONCUR.
BRIEFS FOR APPELLANT: BRIEF FOR APPELLEE:
George R. Carter John R. Benz
Louisville, Kentucky Louisville, Kentucky
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