Morgan County man’s order to pay $16k for property affirmed, COA rules

A man who failed to pay more than $15,000 for property he agreed to purchase could not convince the Indiana Court of Appeals on Thursday that he was wrongly ordered to hand over the money.

Not long after Kenneth Stephens began working with Richard Tabscott, the two men entered into an agreement where Stephens would purchase a property from Tabscott where he could live. Tabscott later claimed that they agreed Stephens would purchase the property for $16,000, but Stephens never paid.

After the deed to the property was signed over and Stephens still hadn’t paid, Tabscott sued in Morgan Superior Court, alleging breach of contract, fraud, theft and conversion. He also sought to recover payment for the property. Stephens pleaded an affirmative defense under the Statute of Frauds, among others, but the trial court rejected his arguments.

Specifically, it denied Stephens’ argument that a strict application of the Statute of Frauds disposed of Tabscott’s claims and concluded that in failing to pay the purchase price, Stephens had committed breach of contract, theft, and conversion.

Additionally, the trial court found that Stephens had fraudulently induced Tabscott to transfer the property with no intention of paying the agreed price. It thus ordered Stephens to pay Tabscott $16,000 for the property and $4,000 for attorneys fees.

If unpaid within 90 days, the trial court stated it would issue and order reforming the deed and transferring the property back to Tabscott.

On appeal, Stephens asserted that that the trial court erred by not applying the Statute of Frauds to bar Tabscott from attempting to enforce the oral contract.

“In this case, Tabscott has by all accounts performed his part of the agreement. The Property has been transferred by warranty deed to Stephens, and Stephens has accepted such transfer. Indeed, Stephens possesses and claims the property as his own by virtue of the warranty deed, which he accompanied Tabscott to record. Under these circumstances, it has long been understood that an action by the seller of land to recover the purchase price is not foreclosed by the Statute of Frauds,” Judge Robert Altice wrote for the appellate court.

“A purchaser such as Stephens cannot escape liability for the purchase price on the ground that the Statute of Frauds prohibits the enforcement of verbal contracts for the sale of an interest in land,” it wrote.

Thus, the appellate court concluded that because Tabscott was not seeking to enforce a contract for the sale of land, but to collect the purchase money on account of such sale, the trial court properly permitted him to do so, notwithstanding the Statute of Frauds.

It also found that the evidence supported the trial court’s finding that Stephens accepted and encouraged the deed transfer while promising to pay $16,000 to Tabscott but with no intention to do so.

However, the appellate court remanded after concluding that Tabscott presented no evidence regarding his attorney’s fees in the case of Kenneth Stephens v. Richard Tabscott, 20A-PL-00562.

“The trial court awarded $4000 in fees. While this amount might certainly be reasonable upon submission of evidence, we can find no support for it in the record. Accordingly, we remand for the trial court to hold a hearing regarding the reasonable attorney’s fees incurred by Tabscott,” it concluded.