Anderson v. Doms

BENCH, Judge

(concurring and dissenting):

133 I dissented in our earlier decision in Anderson v. Doms, 1999 UT App 207, 984 P.2d 392 (Anderson II). In Anderson II, I would have affirmed the trial court's determination that laches barred the remedy of rescission. Largely because I lost that battle, I concur with the main opinion's treatment of Anderson's cross-appeal.

134 I respectfully dissent, however, from the main opinion's ruling on Doms's appeal. When Anderson II was remanded, the trial court dutifully ordered rescission, but denied Doms recovery of the interest-only payments made from 1982 through 1984 on the Trust *933Deed Note.1 I would affirm that decision as being within the trial court's broad discretion to implement the equitable remedy of rescission.

185 The main opinion cites cases from other jurisdictions in constructing its technical rule that "the remedy of rescission includes recovery of interest paid," which can be denied only where the buyer is involved in something like fraud. I am not certain whether that is the rule in other jurisdictions. But I do know that there has never been any such limitation on the trial court's discretion in Utah. Utah's approach to the remedy of rescission was very carefully articulated in Ong International (U.S.A.) Inc. v. 11th Avenue Corp., 850 P.2d 447, 457 (Utah 1993) as follows:

At trial, plaintiffs elected the remedy of rescission. The goal of rescission is to restore the status quo that existed prior to the parties' agreement. The status quo rule "is not a technical rule, but rather it is equitable, and requires practicality in adjusting the rights of the parties. How this is to be accomplished, or indeed whether it can, is a matter which is within the discretion of the trial court under the facts as found to exist by the trier of fact." The trial court therefore has discretion to fashion an adequate and reasonable remedy so that an aggrieved party is adequately compensated for its loss, so long as that remedy is not duplicative.

Id. (citations omitted).

136 An example of Utah's approach is found in Dugan v. Jones, 724 P.2d 955 (Utah 1986), In Dugan, the trial court "disallowed [the] defendants interest on payments made on the purchase price for the period before rescission on the expressly stated ground that [the] defendants had the use and possession of the property." Id. at 957. Our supreme court considered this remedy and concluded that it was "eminently fair and equitable," given the trial court's discretion. Id.

137 In ordering rescission of the 1982 contract in the present case, I believe the trial court properly exercised its "discretion to fashion an adequate and reasonable remedy." Ong International, 850 P.2d at 457. Particularly because of the lengthy passage of time, and because Doms had the exclusive use and possession of the property, it was within the trial court's discretion to decide " 'Thlow [status quo] is to be accomplished, or indeed whether it can' " Id. (quoting Dugon, 724 P.2d at 957). I would therefore affirm the judgment of the trial court in its entirety. Alternatively, this case should be remanded so the trial court can apply the new standard here announced for the first time.

. The trial court awarded Doms the $10,000 earnest money, the $72,500 down payment, the taxes he had paid on the property, and prejudgment interest. On appeal, Doms seeks to add to that an award for $72,520 in interest-only payments made on the Trust Deed Note. He also claims he is entitled to over 20 years of interest on that sum of "well over $400,000."