Anderson v. Joseph
Annotate this Case
Download PDF
REPORTED IN THE COURT OF SPECIAL APPEALS OF MARYLAND No. 554 September Term, 2010 ALDA A. ANDERSON v. NER O JOS EPH, et a l. Graef f, Hotten, Kenney, James A ., III (Retired, Specially Assigned), JJ. Opinion by Graeff, J. Filed: July 11, 2011 This appeal involves the division of proceeds from a trustee s sale of property located at 2309 Sheridan Street, in Hyattsville, Maryland (the Pro perty ). It a ddre sses the a utho rity, and the impact, of one cotenant o btaining a m ortgage on jointly owned property without the consen t of the o ther cote nant. Alda A. Anderson, appellant, owned the Property as a tenant in common w ith Nero Joseph, appellee, who took out a $49,552.79 loan on the Property without her conse nt. After the sale of the Property, the trus tee propos ed a distributio n schedu le that dedu cted this loan from the proceed s prior to determining the 50% share of each of the parties. Ms. Anderson contends that this was improper, and that the loan should have been deducted only from Mr. Joseph s share of the proceeds. On appeal, she challenges the order of the Circuit Court for Prince George s County denying her Exception to the Trustee s Report of Sale. For the reasons set forth below, we reverse, in part, the judgmen t of the circuit c ourt. 1 1 In her brief, M s. Anderso n further arg ued that the court abus ed its discretion in denying her motion to show cause, which requested that the trustee, Erwin Jansen, be ordered to pay for her losses due to his breach of his fiduciary duty as trustee. She contended that Mr. Jansen s breach caused delay in the distribution of the sale proceeds, including interest of at least $500.00, plus legal fees incurred due to the exception and the show cause motion she was forced to f ile. At oral argu ment, how ever, Ms . Anderso n withdre w this claim, recognizing that Mr. Jansen, as a court-appointed trustee, had jud icial imm unity. See D Aoust v. Diamond, 197 M d. App. 19 5, 207 (20 10) (trustees tra ditionally are judicial officers when a ppointed b y the court, and as such, they are entitled to judicial immunity), cert. granted, 418 Md. 586 (2011). Accordingly, we will not address whether Mr. Jansen s actions, or inactions, c onstituted a b reach of h is fiduciary duty. W e further no te that, because Ms. Anderson represented herself, she did not incur legal fees, and th erefore, she would (continued...) FACTUAL AND PROCEDURAL BACKGROUND This is the second time this Court has addressed claims involving the Prop erty. In our prior unrepo rted op inion, Joseph v. Anderson, No. 2792, Sept. Term 2006, slip op. 1-6 (filed Apr. 15, 2008 ), we set for th the facts lea ding up to the first appe al. In 1989, Ms. Anderson purchased the Property and gifted a 50% interest in the Property to her brother, Terrence Anderson. Terrence s wife, Drucilla Anderson,2 subsequently was added to the deed, sharing Terrence s 50% in terest. The h alf interests were held as tenants in common. In 2002, Te rrence die d. At some point thereafter, Drucilla sought to refinance the mortgage and transfer her half interest in the Property to her son, Nero Joseph. When Ms. Anderso n received the closing d ocumen ts from the title company, she saw that the new deed was in the name of Mr. Joseph only. Ms. Anderson contacted the title company and/or the bank to add her name to the new deed. When she was advised that adding he r name to the deed would delay refinancing, and that the mortgage could not be paid without the refinancing, Ms. An derson ag reed to sign the dee d provide d that Mr. J oseph, imm ediately after the closing, would sign a quitclaim deed to put her name back on the title. After closing , howe ver, M r. Josep h refus ed to sig n the qu itclaim d eed. 1 (...continued) not be entitled to recover attorney s fees f rom M r. Jansen . See Friso n v. Math is, 188 Md. App. 97, 109 (2 009). 2 Because there are several people with the last name Anderson, we will refer to Terren ce and Drucil la And erson u sing the ir first na mes. -2- On June 23, 2005, M s. Anderson filed, in the C ircuit Court for Prince G eorge s Cou nty, a request for declaratory and other relief, asking that the court reinstate her interest in the Property and order its sale in lieu of partition. Following a bench trial on December 7, 2006, the circuit court issu ed an ord er declaring that the title to the P roperty be held ha lf in the name of Ms. Anderson and half in the name of Mr. Joseph, as tenants in common. The court declined to order a sale in lieu of partition, opting instead to give the parties the opportun ity to explore the issue. On April 15, 2008, this Court affirmed the judgment of the circuit court in an unreported opinion. On May 27, 2008, Ms. Anderson filed a Motion for Sale and Appointment of Trustee, asserting that Mr. Joseph refused to list the Property for sale and had collected rent and insurance money on the Property without paying any profits he made to he r. She requested that the court: (1) order a sale in lieu of partition; (2) require Mr. Joseph to render an accounting as to monies collected from rent and other sources and pay 50% of any profits he made to her; an d (3) aw ard M s. And erson re asonab le legal f ees and costs. On July 15, 2008, the court a ppointed E rwin R.E . Jansen, Es quire, as trustee to sell the Property and divide the monies resulting from the sale . . . among the parties according to their resp ective rig hts. Pu rsuant to the cou rt s orde r, Mr. Jansen sold the Property by private s ale on J anuary 8 , 2009. On March 25, 2009, Mr. Jansen filed a Trustee s Report of Sale, indicating that the Property had been sold for $2 75,000, an d the cash d ue to sellers w as $95,24 0.47. In his -3- report, Mr. Jansen also indicated that Luis F. Gomez, Jr., on behalf of the law firm Tomes & Salter, LLC, had contacted him regarding a lien it had against the property in the amount of $18,985.02. Mr. Jansen noted that Mr. Joseph and Mr. Gomez had agreed to resolve the lien, which was f or unpaid attorney s fees, in excha nge for Mr. Jose ph s payment of $12,000 to Tomes & Salter, LLC. Mr. Jansen requested that the court ratify the sale, approve his Trustee s fees, and assign the monies to be distributed by the Trustee to each party. Pursuan t to Mr. Jansen s report, the proceeds would be distributed as follows: (1) $46,364.37 to be issued to Ms. Anderson; (2) $34,364.37 to be issued to Mr. Joseph; (3) $12,000 to be issued to Tomes & Salter, LLC; and (4) $2,511.73 to be issued to Mr. Jansen. Attach ed to the Trustee s Report of Sale was a certificate of service indic ating that a copy of the report was mailed on March 23, 200 9, to M s. And erson, M r. Joseph, and Mr. Luis F . Gomez, Jr., Mr. Josep h s previo us cou nsel. On July 24, 2009, Ms. Anderson filed an Exception to the Trustee s Report of Sale, asserting that she did not receive information regarding the sale of the Property until July 20, 2009. She noted that the form attached to the Trustee s Report of Sale indicated a payment of $49,533.23 to Bank of America from the sale of the proceeds,3 but she was unaware of any 3 In her Exce ption to the T rustee s Re port of Sa le, Ms. An derson ind icates that the payment for the Bank of America loan was $49,533.23. Although this number is consistent with the payoff amount listed on the HUD-1 in the record extract, the most recent copy of the HUD-1 in the Record indicates that the payoff amount was $49,552.79. The latter amount is the figure used by the Trustee and the figure that we will use in our calculations. (continued...) -4- encumbrance on the Property other than the first mortgage of approximately $103,000.00. She argued that, because the Property was in the sole name of Mr. Joseph since early 2005, she had no knowledge of the encumbrance on the Property, and if Mr. Joseph did encumber the Property without her knowledge or authorizatio n, he shou ld be totally and s olely obligated . . . to repay that debt. Ms. Anderson further asserted that she had not received a copy of Mr. Jansen s expenses and fees. She requested that she be provided further information regarding the Ban k of America loan prior to court approval of the T rustee s Repo rt of Sa le. On October 5, 2009, Ms. Anderson filed a Motion to Show Cause, noting that she had been advised that her Exception to the Trustee s R eport of S ale would not be hea rd until the Trustee filed a response, but Mr. Jansen had refused to file a response. She asserted that Mr. Jans en had b reac hed his fiduc iary duty to her by: (1) failing to keep her fully informed regarding the sale of the Property; and (2) failing to respond to her exce ption to his rep ort, which denied her access to the proceeds of the sale of the Property. Ms. Anderson requested that the court: (1) o rder Mr. Ja nsen to show cause why he should not be removed as trustee and reimburse her for any los s, including in terest on the sale proceeds and legal fees; (2) review her exception to the report and enter an order increasing her portion of the net proceeds by one-half of the payment to Bank of America; (3) order Mr. Jansen and Mr. Joseph to pay her legal fees in the amount of $2,500; and (4) order Mr. Joseph to pay her 3 (...continued) -5- $1,000 for his failure to disclose his responsibility for the Bank of America debt, which caused a delay in t he distrib ution o f the sal e proce eds. On October 7, 2009, Mr. Joseph filed an answer, asserting that he had obtained the Bank of America loan to make necessary repairs to the basement of the Property following a massive flood. He contended that M s. Anderson knew about the damage[] to the basement from her mother-in-law, who was a close friend of my older sister, but she never offered assistance or requ ested to com e and v iew the dama ge hers elf. Mr. Joseph indicated that he had informed Mr. Jansen of the Bank o f Amer ica loan and had prov ided him w ith receipts for the repairs to the basement, and he requested that the court review the receipts if it considered Ms. Anderson s exceptions. Mr. Joseph asserted that he was not respon sible for M s. And erson s legal fe es. On November 17, 2009, Ms. Anderson filed a repl y to Mr. Joseph s answer. She argued that, even if Mr. Joseph did use the loan to repair flood damage to the property, she should not be obligated for the repairs because she knew nothing of any alleged damage or the loan and [Mr. Joseph] made the alleg ed exp enditur e for his and hi[ s] moth er s ben efit. She again requested that the court: (1) find Mr. Joseph solely liable and responsible for the Bank of America loan; (2) recalculate the proceeds from the sale of the Prope rty to require Mr. Joseph to repay the loan out of his portion of the proceeds; and (3) order M r. Joseph to pay her legal fees in the amount of $2,500, in addition to any additional fees and expenses incurred as a result of Mr. Joseph s actions. -6- On December 10, 2009, Mr. Joseph filed a letter with the court, addressing the allegations in Ms. Anderson s Motion to Show Cause and reply. Mr. Joseph reiterated that he took out the Bank of America loan to repa ir damage caused b y flooding in th e baseme nt, and he provided Mr. Jansen with receipts for such repairs. He requested that the court consider several attached documents, which included, inter alia, the following: (1) pictures of the flooded basement; (2) a local newspaper article regarding the flood; and (3) a letter from the purchaser of the property acknowledging the excelle nt conditio n of the ba sement, as well as the n ew ap pliance s in the k itchen a nd bas emen t. On February 2, 2010, the court held a hearing on Ms. Anderson s motions. Ms. Ande rson tes tified tha t the only c orrespo ndenc e she ha d receiv ed from Mr. Jansen regarding the Property was a letter notifying her that the court had appointed him to sell the Prop erty. She never received notification from Mr. Jansen that the Property had been sold. Instead, she found out several months later when she was contacted by Mr. Joseph s previous counsel, Mr. Gomez. She subsequently received copies of the documents associated with the sale, and she discovered the Bank of America loan. Ms. Anderson contacted Mr. Jansen and advised that she had not authorized any such loan, and she a sked that he investigate it further. Mr. Jansen told her that it was not his job to do so. At that point, she filed an exception to Mr. Jansen s report, and after Mr. Jansen failed to respond to her exception, she filed a motion to sh ow c ause why h e sho uld n ot be removed as truste e and orde red to pay for her losses. -7- With regard to the B ank of Ame rica loan , Ms. A nderso n asserte d that, although Mr. Joseph was entitled to encumber his half interest in the Prope rty, he had no rig ht to encumber her half interest. She stated that she was not aware of the loan, and she requested that the repayment of the loan not be paid out of her portion of the proceeds of the sale of the Prope rty. Mr. Joseph then testified that he obtained the Bank of America loan to repair a flood in the basement of the Property, as well as to do some work on the kitchen.4 He acknowledged that he did not discuss the flood or the loan with Ms. Anderson, explaining: We weren t talking, basically. She never spoke to me. She never lived in Maryland. She lives in Las Vega s. Mr. Joseph stated that he had spoken about the flood with Mr. Gomez, his previous c ounsel, as w ell as Mr. Jan sen, to wh om he ga ve all of the re ceipts for the repairs. Mr. Jansen testified that Ms. A nderson advised h im several months ea rlier that she had not received notice of the sale.5 He testified, how ever, that he d id send he r a copy of his report of sale. Ms. Anderson brought to his attention the dispute over the Bank of America Loan, but he told her that he did not believe that [he] had any authority or oblig ation to 4 Mr. Josep h later clarified that it was not a loan, but an open line of credit, of which he had paid a portion, but not all, prior to the sale of the Property. Because the parties refer to it as a loan, and Mr. Joseph ultimately used the line of credit, we will refer to the transac tion as a loan. 5 The transcript erroneously refers to Mr. Jansen throughout the hearing as Mr. Jackson. We will refer to him as Mr. Jansen. -8- rectify that dispute. He also confirmed that, on one occasion, Mr. Joseph brought several receipts to his office regarding expenses he had incurred for renovations, but he had misplaced them. At the conclusion of the hearing, the court indicated that it would take the matter u nder ad viseme nt. On April 5, 2010, the court issued its order. Without any explanation of its reasons, the court denie d Ms. A nderson s Motion to Show Cause as to the request of the removal of the Tru stee, an d it denie d the E xceptio n to the T rustee s Repo rt of Sa le. This tim ely appea l follow ed. STANDARD OF REVIEW When an action is tried without a jury, the appellate court will review the case on both the law an d the evide nce. It will not set aside the judgment of the trial court on the evidence unless clearly erroneous, and will give due regard to the opportunity of the trial court to judge the credibility of the witn esses. M d. Rule 8-1 31(c). A factual find ing is clearly erroneous if there is no competent and material evidence in the record to support it. Hillsmere Shores Improvement Ass n, Inc. v. Singleton, 182 Md. App. 667, 690 (2008) (quoting Hoan g v. He witt Av e. Asso cs., LLC, 177 Md. App. 562, 576 (2007)). When the ruling of a trial court requires the interpretation and application of Maryland case law, however, we give no deference to its conclusions of law. Elderkin v . Carroll, 403 Md. 343, 35 3 (200 8). -9- A court s order to partition property and distribute proceeds of a sale pursuant to Md. Code (2010 R epl. Vol.) § 1 4-107(a) o f the Rea l Property Article , is equitable in nature, and the court has broad discretion in th e alloca tion of th e proce eds. Meyer v. Meyer, 193 Md. App. 640, 651 (201 0); Maas v. Lucas, 29 Md. App. 521, 525-26 (1975). As this Court recently explained, although we generally give deference to a trial cou rt s exercise o f its discretion, we do not defer to a lower c ourt s exercise of discretion based upon an error of law, nor when the court s ruling is clearly against the logic and effect of facts and inferences before the court. Meyer, 193 Md. A pp. at 651 (citations and quo tations omitted). DISCUSSION Ms. Anderso n argues th at the court er red in dismissing h er Excep tion to the Trustee s Report of Sale, asserting that the Bank of America loan should not have been paid from her one-half interest in the net sales proceeds. She states that, although the circuit court declared in 2006 that she had a half interest in the Property, it remained titled in the sole name of Mr. Joseph, and therefore, she had no access to, or information regarding the Property, and she was unawa re that Mr. Jose ph had en cumbere d the Prop erty without he r consent. Although she acknowledges that Mr. Joseph was free to encumber his own interest in the proper ty, Ms. Anderson asserts that he had no authority or right to encumber her inter est, without her authority or con sent, which she did no t provide. Sh e contend s that, in denying her Exceptio n to the Trustee s Rep ort of Sale, th e circuit cour t permitted M r. Joseph to -10- encumber her interest, thereby redu cing her inte rest to less than the 50% previous ly declare d by the c ircuit co urt. Mr. Jo seph d id not fil e a brief or othe rwise p articipate in this ap peal. The Court of Appeals recently defined a tenancy in common as a type of concurrent estate in which m ultiple parties ha ve interest in a single property. Fagnani v. Fisher, 418 Md. 371, 382 (2011). Here, there is no dispute that Ms. A nderson and M r. Joseph were tenants in com mon. As tenants in common, Ms. Anderson and Mr. Joseph each had an equal right to possess, use, and enjoy the property. Id. (quoting Downing v. Downing, 326 Md. 468, 474 (1992)). They each possessed the authority to se ll or encumber their own individual interests. R ICHARD R. P OWELL , P OWELL ON R EAL P ROPERTY § 50.06[4] (Michael A. Wolf ed., 2010) ( Without consent of cotenants, each tenant in common may sell or encumber his or her proper ty interest, a nd thus inject a s tranger into the c otenan cy. ). The question here is whether Mr. Joseph had the authority to encumber Ms. Anderso n s one-ha lf interest in the P roperty witho ut her autho rity or consent. A review of case law in M aryland a nd othe r jurisdic tions ind icates th at the an swer is no. The Court of Appeals has explained that [o]ne tenant in common has no right to alter or change the property to the injury of the other without his assent. Burnham v. Baltimore Gas & Electric Co., 217 Md. 507, 521-22 (1958) (quoting Susquehanna Transmission Co. v. St. Clair, 113 Md. 667, 672 (1910)). In Burnham, the Court held that a cotenant cannot -11- by himself grant an easement that will bind his cotenants. Id. at 521. Sim ilarly, in Arbeson v. Winer, 298 Md. 282 (1983), the Court noted that one tenant in common has no power to make a lease of the entire estate that will be b inding up on his coten ants witho ut their consent. Id. at 294 (quoting Cook v. Boehl, 188 M d. 581, 5 93 (19 47)). Other jurisdictions h ave discus sed this princ iple in the context of a loan on prop erty. A review of these cases mak es clear that a tenant in co mmon who tak es out a loan on jointly held property can encumber only his or her interest, and another cotenant s interest in the property cannot be used to satisfy the loan. See Gonzalez v. Chase Home Finance LLC, 37 So. 3d 955, 9 57-58 (Fla . Dist. Ct. Ap p. 2010) (b ank entitled to enforce and f oreclose its mortgage only against the one -half interest o f the mortg agor, but no t against the o ne-half interest of the mo rtgagor s co tenant); Brock v. Yale Mortgage Corp., 700 S .E.2d 583, 586 (Ga. 2010) (co tenant wh o purporte d to conve y by deed an inter est in the entire p roperty encumbered her half interest, but did not bind non-consen ting cotenant s half interest); Land America Commonwealth Title Ins. Co. v. Kolozetski, 992 A .2d 681 , 692-93 (N.H. 2010) (cotenant could secu re mortgag e only on his h alf interest in property and could not encumber other co tenant s half inte rest). There are limited circumstances where an otherwise unauthorized act by one cotenant is binding on anothe r cotenant. T his occurs if the nonco nsenting co tenant subs equently affirms or ratifie s the acti on. See K ellejian v . Kesicki, 612 P.2d 63, 64-65 (Ariz. Ct. App. 1980) (although cotenant did not consent to o ther cotena nt s agreem ent to rent the p roperty -12- with an option to purchase, she ratified the act by continuing to accept option payments after she learned of the agreem ent); Geary v. Taylor, 179 S.W . 426, 428-2 9 (Ky. Ct. App. 1915) (cotena nts ratifie d lease b y acceptin g and re taining r ent paym ents). In the present case, the evidence was clear that Ms. Anderson did not consent to, or subseque ntly ratify, Mr. Josep h s action in obta ining the loan encu mbe ring the P rope rty. Ms. Anderson consistently asserted that she had no knowledge of the flooding in the basement of the Property or of the Bank of America loan. Mr. Joseph confirmed the lack of consent to encumber the Property with the loan, testifying at the hearing that he did not discuss the flood in the basem ent or the loa n with M s. Anderso n, and exp laining: We weren t talking, basically. She never spoke to me. Under these circumstan ces, wher e there wa s no evide nce for the circuit court to find that Ms. Anderson authorized Mr. Joseph to encumber the Property with the loan, the loan encumbered only Mr. Jose ph s half in terest in the P rope rty. Accor ding ly, it should have been deduc ted sole ly from M r. Josep h s sha re of the procee ds of th e sale. The division of proceeds should have been calculated by taking the gross amount due to the seller, $276,349.83,6 and subtr acting the $103,526.76 first mortgage, $27,532.55 settlement costs, $32.58 unpaid water bill, and $232.24 for hazard insurance,7 leaving total 6 The house was sold for $275,000, but an adjustment for county taxes brought the net due to s eller to $ 276,34 9.83. 7 Mr. Jansen had to return this am ount to the title company subsequent to closing due to an error in the calculation of the hazard insurance paid as part of the first mortgage payoff. -13- proceeds of $144,793.26 to be distributed. Subtracting trustee fees of $2,511.73, and then dividing the resulting amount of $142, 281.53 acc ording to each party s 50% in terest, results in the sum of $71,140.77 to each party. Mr. Joseph s portion would be reduced by $49,552.79 to satisfy the Bank of America loan, and $12,000 for the agreed-upon prior attorney s fees, lea ving hi m proc eeds in the am ount of $9,587 .98. The Trustee s calculations, which deducted the payment of the loan from the net proceeds of the sale of the Property prior to dividing the proceeds between the parties was erroneous. These calculations left Ms. Anderson with proceeds of $46,364.37, less than her 50% interest in the am ount of $71,14 0.77, an improp er divisio n of the procee ds. There remains a question, however, as to whether Mr. Joseph would be entitled to a credit for repairs he made to the house after the flood. Although Mr. Joseph did not specifically argue below that he was entitled to credit for the monies expended to repair the flooded basement and make improvements to the kitchen, it appears he was suggesting that when he explained that the loan was used to conduct needed repairs. 8 Even assuming that Mr. Joseph sufficiently preserved the issue for our review, the evidence here does not suppo rt a credit fo r paymen ts relating to repair s. The entitlem ent to contribution from a cotena nt depe nds on the type o f payme nt mad e. Ge nera lly, one cotenant who pays the mortgage, taxes, and other carrying charges of jointly owned property 8 Mr. Joseph was not represented below, and as indicated, he did not f ile a brief in this Court. -14- is entitled to contrib ution fr om the other. Crawford v. Crawford, 293 Md. 307, 309 (1982 ). Accord Pino v. Clay, 251 Md. 454, 456-57 (1968). With respect to repairs, however, the Court of Appea ls has expla ined: [T]he general rule is that one cotenant is entitled to contribution from another for necessary repairs and improvements when they were made with the assent of the other, or the repairs were necessary for the preservation of the building or other erec tion on the la nd, and w ere done b y one cotena nt after request of and refusa l by the othe r cotenan t . . . . Colburn v. Colburn, 265 Md. 468, 477 (1972) (quoting Woodcock v. Pope, 154 Md. 135, 147 (1928 )). In Colburn, in the context of a complaint f or an acco unting, the C ourt of A ppeals affirmed the trial court s refusal to give Mr. Colburn credit for repairs to rental property on the ground that he did not obtain authorization from Mrs. Colburn prior to making the repairs. Id. The Court stated: [F]actors such as the expedien cy of makin g necessa ry repairs, the pos sible obligations of third parties to make repa irs and, indeed, the necessity of the repairs themselves are proper objects of consideration for all of the joint owners. Mr. Colburn s action in not informing his wife of the performance of the repairs, deprived her of the opportunity to make these determinations prior to the m oney bei ng exp ended . Id. Similarly, here, the evidence shows that Mr. Joseph did not give Ms. Anderson the opportun ity to de term ine th e exp edie ncy or necessity of making the repairs prior to the money being exp ended. M oreover, M r. Joseph did not show that the repairs here were necessary for the preservation of the house; he did not even introduce evidence of the -15- specific repairs made.9 Accordingly, a credit was not warranted by the evidence as a matter of law. Accor ding ly, the Trustee s Report of Sale, which proposes a distribution of the proceeds of the sale of the P rope rty that fails to give Ms. Anderson her 50% share of the proceeds, is improper. The circuit court abused its discretion in denying Ms. An derson s Excep tion to th e Trust ee s Re port of Sale. JUDGMENT DENYING EXCEPTION R E V E R S E D . REM ANDED F O R PROCEEDINGS CONSISTENT WITH THIS OPINION. COSTS TO BE P AID BY APPELLEE, NERO JOSEPH. 9 There was no specific testimony at the hearing regarding what rep airs were made or how m uch w as spen t for spe cific rep airs. -16-
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
