M & M Farm, Inc., Appellant, v. John Pilla, Billie Pilla, Missouri Title Guaranty Co., D/b/amissouri Title Company and Insurance Company Ofminnesota, Appellees, 791 F.2d 639 (8th Cir. 1986)

M & M Farm, Inc. (M & M), brought suit against John and Billie Pilla (the Pillas) and Missouri Title Guaranty Company (Missouri Title), seeking rescission of a contract for the sale of real estate, reimbursement for improvements to the property, and damages for fraud. The basis of M & M's suit is its allegation that the Pillas sold M & M certain real estate on March 1, 1983, by a general warranty deed and that Missouri Title issued a title insurance policy on the property even though both the Pillas and Missouri Title knew at the time of the sale that the personal representative of the estate of John Pilla's mother was contesting John Pilla's title to the property.¹ 

The district court²  initially stayed M & M's federal court action against the Pillas and Missouri Title pending resolution of the state court proceedings over the property in question between John Pilla and the personal representatives of his mother's estate. After the Missouri Court of Appeals rendered its decision in Pilla v. Estate of Pilla, 689 S.W.2d 727 (Mo.App.1985), affirming the state circuit court's holding that John Pilla had validly exercised an option to purchase the property from his mother's estate, the district court dismissed M & M's action for fraud and rescission against the Pillas and Missouri Title. In dismissing M & M's action, the district court relied on the doctrine of after-acquired title,³  which provides that where a grantor, who had previously undertaken to convey property to a grantee by a warranty deed, subsequently acquires title to the property, the subsequently acquired title inures to the benefit of the grantee from the date of conveyance. See, e.g., Sabine v. Leonard, 322 S.W.2d 831, 835-36 (Mo.1959); Johnson v. Johnson, 170 Mo. 34, 70 S.W. 241, 245-47 (1902). The district court determined that once the Missouri Court of Appeals held that John Pilla had validly exercised his option to purchase the property from his mother's estate, title to the property in question immediately vested in M & M, dating back to March 1, 1983, and M & M thus no longer had a cause of action against the Pillas or Missouri Title. After careful consideration of the record, the briefs, and the arguments of the parties, we find that the district court did not err in dismissing M & M's complaint.

Affirmed. See 8th Cir.R. 14.