Dillon v. Southern Management Corp. Retirement Trust , 2014 Utah LEXIS 54 ( 2014 )

AMENDED OPINION*
This opinion is subject to revision before
publication in the Pacific Reporter
2014 UT 14
IN THE
SUPREME COURT OF THE STATE OF UTAH
DOUGLAS C. DILLON and MOLLY R. DILLON,
Plaintiffs and Appellees,
v.
SOUTHERN MANAGEMENT CORPORATION RETIREMENT TRUST, et al.,
Defendants and Appellants.
No. 20120145
Filed May 13, 2014
Third District, Silver Summit
The Honorable Keith A. Kelly
No. 080500830
Attorneys:
Bruce A. Maak, Robyn L. Wicks, Salt Lake City, for appellees
Eric P. Lee, Kathleen E. McDonald, Salt Lake City, for appellants
ASSOCIATE CHIEF JUSTICE NEHRING authored the opinion of
the Court, in which JUSTICE PARRISH, JUSTICE LEE,
JUDGE VOROS, and JUDGE HANSEN joined.
Having recused themselves, CHIEF JUSTICE DURRANT and
JUSTICE DURHAM do not participate herein;
COURT OF APPEALS JUDGE J. FREDERIC VOROS, JR. and
DISTRICT JUDGE ROYAL I. HANSEN sat.
ASSOCIATE CHIEF JUSTICE NEHRING, opinion of the Court:
INTRODUCTION
¶ 1 Southern Management Corporation Retirement Trust
(SMCRT) seeks review of the district court’s grant of summary
* The court has added ¶ 61 and altered ¶ 62 to address
appellees’ request for attorney fees on appeal.
DILLON v. SOUTHERN MANAGEMENT
Opinion of the Court
judgment in favor of Douglas C. and Molly R. Dillon. The district
court determined that the trust deed encumbering the Dillons’
property in Park City was invalid, that SMCRT had slandered the
Dillons’ title, and that SMCRT was therefore liable for damages
under (a) section 57-1-38(3) of the Utah Code and (b) the trust
deed itself. The district court determined that the Dillons were
entitled to recover their attorney fees and that a portion of those
fees should be trebled pursuant to section 57-1-38 of the Utah
Code. SMCRT argues that each of these conclusions was
erroneous. We affirm the district court’s grant of summary
judgment and the majority of its award of damages, but reverse
its grant of treble attorney fees under Utah Code section
57-1-38(3).
BACKGROUND
¶ 2 SMCRT owns approximately twenty-five thousand
properties, including apartments, office buildings, resort
properties, and garages. SMCRT also funds loans secured by real
estate. In 2005 and 2006, SMCRT agreed to use Robert Rood and
his companies, Level One Capital Partners, LLC (Level One) and
Blue Horseshoe Portfolio Services (Blue Horseshoe), to originate
loans that would be funded by SMCRT. Under the agreement,
Level One and Blue Horseshoe would find borrowers, prepare
loan documents, and choose a title company to close the
transactions. SMCRT funded approximately thirty-two loans
through Mr. Rood and his companies.
¶ 3 In June 2006, Level One originated a $500,000 loan to
Thomas Gramuglia (loan or note). To secure the loan,
Mr. Gramuglia signed a trust deed (trust deed) for properties he
owned in New York (New York Property) and Park City (Park
City Property), under which Level One was named the
beneficiary. Later in June 2006, Level One assigned the trust deed
and note to SMCRT, but SMCRT did not record the assignment of
the trust deed until August 2008.
¶ 4 Initially, Mr. Gramuglia made loan payments to Level
One, and Level One in turn made monthly interest payments to
SMCRT. But despite the fact that he was making payments
directly to Level One, Mr. Gramuglia soon discovered that
SMCRT was involved with the loan. On August 1, 2006, SMCRT
sent Mr. Gramuglia a letter stating that the “servicing of the [loan]
had been transferred to [SMCRT], effective with the August 1,
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Opinion of the Court
2006 loan payment.” In December 2006, SMCRT sent
Mr. Gramuglia a similar letter. Upon Mr. Gramuglia’s inquiry,
SMCRT informed him to disregard the notices and continue
making loan payments directly to Level One. A similar situation
arose again in July 2007 when SMCRT informed Mr. Gramuglia
that his loan, which “originated . . . with Level One . . . and [was]
purchased by [SMCRT],” had matured and was immediately due
and payable in full to SMCRT. Mr. Gramuglia’s attorney sent a
reply letter to SMCRT explaining that Mr. Gramuglia had
extended the maturity date of the loan by exercising his option
with Level One over three months prior. The letter invited
questions from SMCRT. SMCRT did not respond.
¶ 5 Shortly thereafter, Mr. Gramuglia and Mr. Rood, who
was acting on behalf of Level One, discussed the possibility of
Mr. Gramuglia selling the Park City Property and using the
proceeds to pay down the balance of his loan. Mr. Gramuglia
proposed that in return for the partial prepayment, SMCRT
would agree to release the Park City Property from the trust deed,
and the remaining balance of the loan would then be secured
solely by the New York Property.
¶ 6 On August 15, 2007, Mr. Rood met with SMCRT’s
investment committee to discuss the modification of
Mr. Gramuglia’s loan and corresponding release of the Park City
Property. What happened in the meeting is a central source of
dispute between the Dillons and SMCRT. Three of the four
investment committee members could not recall what transpired
in that meeting. One member remembered that they had
discussed Mr. Gramuglia paying down part of the loan. The
handwritten notes of Michael McKinley, an investment committee
member, are the only significant written evidence of what
happened in the meeting. His notes read, in pertinent part:
Will pay down $250,000 on Park City UT 9/15
Refi pending for NY Property
Escrowed thru 10/1
Will extend until 12/31/07
@ 250,000 Rood will prepare modification
¶ 7 Based on this evidence, the Dillons contend that during
the meeting SMCRT “agreed in return for $250,000 payment from
the sale of the [Park City Property] to release the [Park City
Property].” In contrast, SMCRT’s position is that Mr. Rood was
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Opinion of the Court
there to ask for authority to modify the loan and that permission
was granted only if three conditions were met: (1) SMCRT’s
receipt of a $20,000 loan extension fee, (2) SMCRT’s receipt of
$250,000, and (3) the preparation and execution of “a loan
extension and modification agreement.”
¶ 8 After Mr. Rood’s meeting with SMCRT’s investment
committee, Mr. Gramuglia listed the Park City Property and sold
it to the Dillons in September 2007. First American Title Insurance
Company (FATCO) handled the closing of the sale. FATCO
requested that Level One, as the record owner of the trust deed,
issue a written payoff letter listing the amount necessary to pay
off the note and release the trust deed on the Park City Property.
Level One provided the payoff letter to FATCO, dated August 29,
2007, and in it stated that the payoff amount was $250,000.
FATCO disbursed $250,000 to Level One on September 7, 2007.
On the same date, Mr. Gramuglia delivered a warranty deed to
the Dillons and they recorded it. 1 At the time of the purchase,
neither FATCO nor the Dillons knew that the beneficial interest
under the trust deed had been assigned to SMCRT because
SMCRT had not recorded the assignment.
¶ 9 Sometime after the Dillon closing in late 2007, SMCRT
initiated an investigation into Mr. Rood and Level One. Based on
that investigation, SMCRT concluded that Mr. Rood and his
entities had misappropriated money belonging to SMCRT.
¶ 10 On May 9, 2008, SMCRT filed a lawsuit in Montgomery
County, Maryland, against Mr. Rood and his entities seeking to
recover the allegedly misappropriated funds, including the
$250,000 paid by the Dillons at the Park City Property closing
1 The parties dispute whether SMCRT received any of the
$250,000 that was disbursed by FATCO to Level One. The Dillons
contend that SMCRT did receive the $250,000 through its agent,
Mr. Rood, because SMCRT approved the payoff amount at the
August 15 meeting and Level One collected that amount in its
capacity as SMCRT’s loan manager and servicer. SMCRT,
however, claims that Level One did not transfer any of the
$250,000 to SMCRT and that in any event Level One and Mr. Rood
were not acting as authorized agents when they orchestrated and
then received the payoff money.
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Opinion of the Court
(Rood Action). In the Rood Action, SMCRT asserted that
“SMCRT entered into a business relationship with Rood”
whereby, “acting in his individual capacity and/or through [his
companies] and pursuant to the agreements between the parties,
Rood would originate, process, underwrite, close and fund these
private loans.” SMCRT also stated that Mr. Rood and his
companies would “service the loan for [SMCRT] during the life of
each loan,” and that SMCRT did not have “any direct contact with
the borrowers either when the original loan was made or during
the term of the loans.”
¶ 11 On July 15, 2008, David Hillman, one of SMCRT’s
trustees, sent an email in which he explained to the recipient that
“on September 7, 2007 a closing occurred on the sale of
Gramuglia’s property in Utah to what appears to be innocent 3rd
parties.” Nevertheless, sometime that same summer, SMCRT
retained Park City attorney Dwayne Vance to initiate a
nonjudicial foreclosure of the Park City Property pursuant to the
Gramuglia trust deed. SMCRT also directed Mr. Vance to open a
dialogue with FATCO, with the hope of avoiding the foreclosure
process and resolving the matter informally. Mr. Vance made
several efforts to discuss resolution with both FATCO and the
Dillons, but he did not receive any response.
¶ 12 On November 17, 2008, Mr. Vance prepared a “Notice of
Trustee’s Sale” for the Park City Property, setting December 17,
2008, as the sale date. On December 5, the Dillons filed a
complaint against SMCRT. The complaint sought a restraining
order to enjoin SMCRT’s foreclosure sale. On December 12, the
district court granted the Dillons a temporary restraining order.
¶ 13 On January 15, 2009, SMCRT filed a “Motion to Stay
Proceedings,” pointing out that Mr. Rood had initiated
bankruptcy proceedings in Maryland. In support of its motion, it
argued that the results of the bankruptcy case would materially
advance the resolution of the Dillons’ claims. The district court
denied this motion. The Dillons filed a second amended
complaint on April 30, 2009.
¶ 14 SMCRT then filed a motion to dismiss portions of the
Dillons’ second amended complaint. The district court granted
portions of the motion and denied others. The Dillons’ surviving
causes of action included (1) a request for a declaratory judgment
that (a) the trust deed had been discharged by Mr. Rood and
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(b) the trust deed should have been released and reconveyed
under the Utah Recording Act, (2) a request for damages under
Utah Code section 57-1-38, stemming from SMCRT’s failure to
release the trust deed, (3) a request for recovery of attorney fees
under the terms of the trust deed, and (4) slander of title.
¶ 15 In December 2009, SMCRT executed and recorded a
reconveyance of the trust deed as part of a settlement in another
case it had filed in Maryland against Mr. Gramuglia (Gramuglia
Action). In the Gramuglia Action, SMCRT sought to recover
$500,000, plus interest and attorney fees, on the loan. During trial,
the parties settled. As part of the settlement, on December 11,
2009, SMCRT executed and recorded with the Summit County
Recorder a reconveyance of the trust deed and Mr. Gramuglia
paid SMCRT $300,000.
¶ 16 In April 2010, the Dillons brought a motion for partial
summary judgment, and in October, SMCRT filed its own motion
for partial summary judgment. 2 After hearing argument on the
motions, on April 7, 2011, the district court granted summary
judgment in favor of the Dillons. The court concluded that
SMCRT was liable to the Dillons on the four surviving claims.
The district court held (1) that the Utah Recording Act “rendered
2 In September 2010, before the court had ruled on their
motion for summary judgment, the Dillons filed a “Motion to
Apply Collateral Estoppel with Respect to the Summary
Judgment Issues.” This motion was based on the fact that at some
time earlier, SMCRT had filed suit against FATCO in Maryland
concerning the same issues (FATCO Action). In August 2010, the
Maryland court determined that Mr. Rood and his company,
Level One, were “authorized” by SMCRT to “quote and receive
the payoff of the Gramuglia Trust Deed in the Dillon transaction.”
The Dillons sought to apply collateral estoppel on this basis. The
district court agreed with the Dillons and in issuing its ruling on
summary judgment, simultaneously granted the Dillons’ motion
to apply collateral estoppel, using it as an “independent ground”
under which Mr. Rood and his company, Level One, could be
seen to have acted with authorization from SMCRT. However,
because we determine that Mr. Rood was acting as an authorized
agent under a ratification theory, we need not address the
collateral estoppel claim. See infra Part I.
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Opinion of the Court
the off-record interest of Southern Management in the Gramuglia
Trust Deed void as against the Dillons,” (2) that Mr. Rood and
Level One were authorized to act on behalf of SMCRT “in quoting
and receiving the payoff with respect to the Dillon closing in
return for a reconveyance of the Gramuglia Trust Deed,”
(3) SMCRT was liable for slander of title, and (4) SMCRT
wrongfully refused to reconvey the Gramuglia trust deed and
thus breached both the terms of the deed itself as well as Utah’s
Trust Deed Act. The court did not enter final judgment at that
time, but instead scheduled a one-day evidentiary hearing to
determine damages.
¶ 17 On July 12, 2011, the court heard evidence on the
Dillons’ damages. Because of the nature of the dispute, the
Dillons’ damages were almost entirely in the form of attorney
fees. On October 14, 2011, the district court awarded the Dillons
attorney fees and costs totaling $1,603,182.07. 3 Of particular
importance to our holding, pursuant to Utah Code section
57-1-38(3) the court trebled the Dillons’ “Resisting Foreclosure”
and “Quiet Title” damages amounts, which included and indeed
were largely comprised of attorney fees.
¶ 18 SMCRT filed a rule 60(b) motion for relief from
judgment on October 7, 2011, which the district court denied.
This motion was based on a bankruptcy action in Maryland, in
which SMCRT and the bankruptcy trustee sued Mr. Rood for
fraud and conspiracy with respect to the thirty-two loans that
Mr. Rood made on behalf of SMCRT, including the Gramuglia
3 The court arrived at this figure by adding the Utah Code
section 57-1-38 damages with “Nonoverlapping Section 78B-5-826
damages.” Section 57-1-38 damages were awarded in several
categories. “Resisting Foreclosure damages” totaled $24,446.20
and accounted for the damages resulting from SMCRT’s wrongful
effort to foreclose. This included attorney fees and expenses
incurred to fight the foreclosure action. “Quiet Title damages”
totaled $458,956.91 and were the result of SMCRT’s continued
refusal to reconvey the trust deed. This number included attorney
fees and expenses incurred to establish that the trust deed was not
a valid encumbrance. The court awarded the Dillons damages on
the basis of their successful slander of title claim as well as in a
number of other categories.
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loan. After a trial, the Maryland bankruptcy court found that
Mr. Rood had “released, without consideration,” the Park City
Property “from the [trust deed]” and that SMCRT had no notice of
the release. The court also found that Mr. Rood “sent a
fraudulent payoff letter to [FATCO] that resulted in the title
company wiring $250,000” to one of Mr. Rood’s companies.
SMCRT argued that, under the doctrine of comity, the district
court should revise its summary judgment ruling on the basis that
the bankruptcy court had determined that Mr. Rood’s actions
were fraudulent. The court held that SMCRT showed “no legal or
procedural error or irregularity . . . as would justify the
application of Rule 60(b)(6).” Moreover, the court found that the
doctrine of comity “does not apply here” and even if it did, the
bankruptcy court’s “suggestion that Rood perpetrated a fraud
upon [SMCRT] and misappropriated its money would have no
effect upon the Summary Judgment Order.”
¶ 19 After entering its October 14, 2011 findings of fact and
conclusions of law on damages, the district court “became
concerned that it had not performed a sufficiently rigorous
analysis of the application of [Utah Code section] 57-1-38(3) in
awarding damages, and in particular, in determining what
amounts of attorney fees and costs should be trebled . . . .” The
court asked for supplemental briefing on the issue. It ultimately
determined that it had improperly trebled a portion of the Dillons’
damages—namely, those incurred after SMCRT reconveyed the
trust deed on December 11, 2009. On that basis, the court reduced
the total award of fees and costs to $1,120,395.69, and on
January 23, 2012, it issued “Amended Findings of Fact and
Conclusions of Law Concerning Damages,” and a separate “Final
Judgment.”
¶ 20 SMCRT timely appealed, and the Dillons cross-appealed.
We have jurisdiction over this matter pursuant to section 78A-3-
102(3)(j) of the Utah Code.
STANDARD OF REVIEW
¶ 21 “We review the district court’s grant of summary
judgment for correctness” and “accord no deference to [its]
conclusions of law.” 4 Rather, we review de novo whether the
4 Torian v. Craig, 2012 UT 63, ¶ 13, 289 P.3d 479.
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record shows that “there is no genuine issue as to any material
fact and that the moving party is entitled to judgment as a matter
of law.” 5 Moreover, “we may affirm the result reached by the
trial court if it is sustainable on any legal ground or theory
apparent on the record, even though that ground or theory was
not identified by the lower court as the basis of its ruling.” 6
ANALYSIS
¶ 22 This case began when the Dillons sought to stop
SMCRT’s foreclosure action and to quiet title in the Park City
Property. However, since SMCRT reconveyed the property
following a settlement in the Gramuglia Action in December 2009,
the focus of the case has become recovery of the attorney fees and
costs incurred by the parties.
¶ 23 SMCRT argues that the court erred when it granted the
Dillons summary judgment on the basis of a principal-agent
relationship between Mr. Rood/Level One and SMCRT. SMCRT
takes issue with both of the district court’s alternate grounds for
concluding that Mr. Rood was authorized to “quote and receive
the Dillon payoff and agree to the reconveyance of the Gramuglia
Trust Deed.” SMCRT challenges the district court’s finding that
Mr. Rood either had actual authority or SMCRT ratified that
authority, or alternatively, that SMCRT was estopped from
denying the agency relationship under the doctrine of collateral
estoppel (stemming from the Gramuglia Action). SMCRT also
argues that under the doctrine of comity, the district court should
have adopted the conclusion of the Maryland bankruptcy court,
which found that Mr. Rood was not acting as SMCRT’s agent
because he was actively defrauding SMCRT. We hold that
SMCRT ratified Mr. Rood’s actions in the Dillon transaction and
thus we do not address the collateral estoppel or comity
arguments.
¶ 24 SMCRT also argues that the district court erred when it
granted summary judgment to the Dillons and awarded them
damages, some of which were trebled under Utah Code section
57-1-38(3). SMCRT argues that summary judgment on the
5 UTAH R. CIV. P. 56(c).
6 Smith v. Frandsen, 2004 UT 55, ¶ 6, 94 P.3d 919 (internal
quotation marks omitted).
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Opinion of the Court
Dillons’ slander of title claim was improper because (1) the trust
deed was a valid encumbrance under which SMCRT, as
beneficiary, could lawfully foreclose and (2) the district court
erred in granting summary judgment where “malice,” a required
element of slander of title, was a disputed fact. We conclude that
the district court made an error of law with respect to slander of
title and thus we clarify the law and affirm on alternate grounds.
¶ 25 SMCRT argues, generally, that the district court erred in
granting summary judgment on behalf of the Dillons and thus
damages were inappropriate. They also argue that attorney fees
were improperly trebled under Utah Code section 57-1-38(3). The
Dillons cross-appealed on this issue and argue that they should
have received treble attorney fees for the entire action, not just for
the period prior to SMCRT’s reconveyance. Finally, SMCRT
argues that the Dillons are not entitled to attorney fees because
they did not incur any attorney fees—FATCO was liable for the
fees under the title insurance policy. We hold that the court
improperly trebled attorney fees under Utah Code section
57-1-38(3) and remand for a recalculation of damages. We affirm
the award of all other damages.
I. SMCRT RATIFIED THE ACTIONS OF
MR. ROOD AND LEVEL ONE
¶ 26 SMCRT argues that the district court erred when it
concluded that Mr. Rood and Level One were acting as SMCRT’s
agents. Specifically, SMCRT argues that there were not sufficient
facts to find either actual or implied authority in this case. The
Dillons maintain that there was a principal-agent relationship
between SMCRT, Mr. Rood, and Level One. The Dillons contend
that even in the absence of actual or apparent authority, SMCRT
nevertheless ratified Mr. Rood’s actions when it sued him to
recover the $250,000 the Dillons paid for the purchase of the Park
City Property. 7 We agree.
7 The Dillons make two other agency arguments. They claim
that by failing to record its assignment, SMCRT consciously
allowed Level One to remain the owner of record of the Park City
Property, which gave Level One apparent authority to deal with
prospective purchasers like the Dillons. They also argue that
Mr. Rood and Level One had apparent authority to complete the
transaction because SMCRT expressly stated to Mr. Gramuglia
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¶ 27 SMCRT responds by arguing that (1) for ratification to
occur, there must have been an agency relationship at the time of
the relevant conduct, (2) the Dillons presented no evidence that
SMCRT intended to ratify Mr. Rood’s conduct, and (3) SMCRT’s
lawsuit against Mr. Rood and his companies is not proof of
ratification.
¶ 28 It is a well-settled principle of agency law that “[a]
principal may impliedly or expressly ratify an agreement made by
an unauthorized agent.” 8 “[R]atification requires the principal to
have knowledge of all material facts and an intent to ratify.”9 “A
deliberate and valid ratification with full knowledge of all the
material facts is binding and cannot afterward be revoked or
recalled,” 10 particularly in cases where the principal has received
and retained the benefit of the ratification. 11
¶ 29 SMCRT argues that an actual agency relationship is a
prerequisite to application of the doctrine of ratification. This is
untrue. “Ratification of an agent’s acts relates back to the time the
unauthorized act occurred and is sufficient to create the
relationship of principal and agent.” 12 Thus, a threshold agency
determination is not required. 13
that he should be dealing directly with Level One and that that
manifestation of authority would have passed from
Mr. Gramuglia to the Dillons. Because we agree that SMCRT
ratified Mr. Rood’s actions by suing him to recover the $250,000,
we need not address the Dillons’ other agency arguments.
8 Bradshaw v. McBride, 649 P.2d 74, 78 (Utah 1982).
9 Id.
10 Id.
11Zions First Nat’l Bank v. Clark Clinic Corp., 762 P.2d 1090, 1099
(Utah 1988) (citing RESTATEMENT (SECOND) OF AGENCY §§ 98–99
(1958)).
12Id. at 1098 (quoting Bradshaw, 649 P.2d at 78). See also Jones v.
Mut. Creamery Co., 17 P.2d 256, 259 (Utah 1932).
13 See Zeese v. Estate of Siegel, 534 P.2d 85, 89 (Utah 1975)
(“[A]lthough the act may have [been] done without any precedent
authority, ratification creates the relation of principal and agent.”).
Moreover, even if an actual agency relationship were required,
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¶ 30 For ratification to occur, the principal must have
knowledge of all “material facts and circumstances relative to the
unauthorized act or transaction.” 14 “Ratification of an act about
which the principal knows nothing is inherently impossible.”15
Thus, an essential fact that is implicit to a finding of ratification is
the principal’s knowledge that an individual has acted
purportedly on behalf of the principal or as the principal’s agent.
SMCRT does not dispute that at the time it filed the Rood Action
it was aware of the actions Mr. Rood took purportedly on its
behalf during the sale of the Park City Property.
¶ 31 SMCRT also argues that there is no evidence that it
intended to ratify Mr. Rood’s actions. However, “[a] principal
may impliedly or expressly ratify an agreement made by an
unauthorized agent.”16 Ratification, “like original authority need
not be express. Any conduct which indicates assent by the
purported principal to become a party to the transaction or which
is justifiable only if there is ratification is sufficient.” 17
¶ 32 In its action against Mr. Rood, SMCRT was attempting to
recover the $250,000 Level One received as a result of selling the
Park City Property to the Dillons. But the only way SMCRT could
SMCRT would still lose. The parties agree that SMCRT received
twelve monthly interest payments on the Gramuglia loan between
August 2006 and July 2007 from funds held in escrow by
Mr. Rood’s company, Level One. This fact alone establishes that
there was an agency relationship between Mr. Rood and SMCRT.
SMCRT has presented no evidence to suggest that it terminated
this agency relationship prior to the sale of the Park City Property
in September 2007.
14 Jones, 17 P.2d at 259.
15 Zions First Nat’l Bank, 762 P.2d at 1098 (internal quotation
marks omitted). See also RESTATEMENT (THIRD) OF AGENCY:
RATIFICATION § 4, intro. note (2006) (explaining that “[a] person
may ratify the act of an actor who was not an agent at the time of
acting when the actor purported or assumed to act as the person’s
agent”).
16 Bradshaw, 649 P.2d at 78.
17 Moses v. Archie McFarland & Son, 230 P.2d 571, 573–74 (Utah
1951) (emphasis omitted).
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legitimately recover those funds was if it acknowledged
Mr. Rood’s authority with respect to the sale of the Park City
Property. As the Dillons point out, “[t]he Trust cannot
consistently claim that it was entitled to receive the Dillons’
$250,000 payment from [Mr.] Rood, but that [Mr.] Rood was
completely unauthorized to enter into the transaction through
which that payment was received.” SMCRT’s position that
Mr. Rood was unauthorized to sell the property to the Dillons
conflicts with SMCRT’s attempt to recover the $250,000. By suing
Mr. Rood to recover those funds, SMCRT ratified the transaction,
and that ratification “relates back to the time the . . . act
occurred.” 18 In other words, through ratification, regardless of
the agency status at the time of the transaction, it is as though
Mr. Rood was acting as an authorized agent of SMCRT the entire
time. 19 Moreover, to hold otherwise would allow SMCRT to take
contrary positions in independent legal proceedings and reap the
benefit of those contrary positions with the potential of obtaining
a double recovery. 20
18 Zions First Nat’l Bank, 762 P.2d at 1098 (quoting Bradshaw,
649 P.2d at 78).
19 RESTATEMENT (THIRD) OF AGENCY: RATIFICATION § 4, intro.
note (2006) (“By ratifying an act, a principal triggers the legal
consequences that would follow had the act been that of an agent
acting with actual authority.”).
20 This is also consistent with the well-established principle
that a “defrauded party, after learning the truth will not be
permitted to go on deriving benefits from the transaction and later
elect to rescind.” Frailey v. McGarry, 211 P.2d 840, 845 (Utah 1949).
A contract that is allegedly entered through fraud or
misrepresentation is “voidable, and it is entirely within the right
of the injured party to affirm it or treat it as valid . . . [T]he party is
entitled to a reasonable time in which to decide upon the course
he will take. But this does not mean that he will be indulged in a
vacillating or hesitating course of conduct, but that he must . . .
avoid such a delay as will make the ensuing rescission injurious to
. . . the intervening interests of third persons.” Id. (internal
quotation marks omitted); see also Ockey v. Lehmer, 2008 UT 37,
¶ 32, 189 P.3d 51 (“The purpose of doctrines like ratification and
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¶ 33 In short, even if we accept the unlikely proposition that
Mr. Rood and Level One had no authority to act on behalf of
SMCRT at the time of the sale of the Park City Property, SMCRT’s
lawsuit against Mr. Rood and his entities constituted a ratification
of those actions. We therefore affirm the district court’s
conclusion that Mr. Rood was acting as SMCRT’s agent during the
Dillon transaction. Having found that Mr. Rood was SMCRT’s
agent through ratification, we need not address the other agency
arguments.
II. SUMMARY JUDGMENT WAS APPROPRIATE
ON THE SLANDER OF TITLE CLAIM
¶ 34 The Dillons claim that SMCRT slandered their title
because it published false information disparaging the Dillons’
title when it (1) improperly filed foreclosure documents against
the Dillons’ property, (2) communicated false information about
the state of the Dillons’ title to the Dillons’ lender, and (3) directed
the title company not to reconvey the Gramuglia trust deed.
SMCRT argues first that the Dillons’ title was in fact invalid and
thus SMCRT could not have committed slander of title.
Alternatively, they argue that slander of title requires actual
knowledge that the information published is false, and thus the
question of whether SMCRT had such knowledge is a disputed
fact inappropriate for summary judgment. We agree that slander
of title requires actual knowledge, but hold that the undisputed
facts nevertheless show that SMCRT committed slander of title as
a matter of law. We thus affirm the district court on alternate
grounds. 21
¶ 35 The district court correctly concluded that all of the
elements of slander of title were established by the undisputed
facts. However, the district court misstated the malice standard
when it reasoned that SMCRT “acted with malice under Utah law
because they knew or should have known that the Gramuglia trust
deed did not constitute an enforceable encumbrance against the
apparent authority is to avoid instances where a technicality can
be used to evade a contract . . . .”).
21 See Bailey v. Bayles, 2002 UT 58, ¶ 10, 52 P.3d 1158 (“It is well
settled that an appellate court may affirm the judgment appealed
from if it is sustainable on any legal ground or theory apparent on
the record . . . .” (internal quotation marks omitted)).
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Dillon Property.”22 We now clarify that to show malice in a claim
for slander of title, the plaintiff must prove that the defendant had
actual knowledge that the statements at issue were false.
¶ 36 Utah has adopted a four-step analysis in evaluating
slander of title claims:
To prove slander of title, a claimant must prove that
(1) there was a publication of a slanderous statement
disparaging claimant’s title, (2) the statement was
false, (3) the statement was made with malice, and
(4) the statement caused actual or special damages. 23
We have previously held that “the filing of an instrument in good
faith, though mistaken, is not actionable as slander of title.”24
Thus, for a slanderous statement to be malicious, the defendant
must have actually known that it was false or misleading. 25 Yet,
although the defendant must know that the statement is false, it
need not be “affirmatively shown that the wrong was done with
an intent to injure, vex or annoy, or because of hatred, spite or ill
will.” 26 Instead, malice “may be implied where a party
knowingly and wrongfully . . . publishes something untrue or
spurious . . . under circumstances that it should reasonably
foresee might result in damage to the owner of the property.”27
¶ 37 In seeking to foreclose on the Park City Property and in
various other communications, SMCRT represented that the loan
22 (Emphasis added).
23 First Sec. Bank of Utah, N.A. v. Banberry Crossing, 780 P.2d
1253, 1256–57 (Utah 1989) (emphasis added).
24 Howarth v. Ostergaard, 515 P.2d 442, 444 n.1 (Utah 1973).
25 Dowse v. Doris Trust Co., 208 P.2d 956, 958 (Utah 1949) (“At
the time [Defendant] filed the instrument he knew that he had no
rights or interest in the property . . . under such a state of facts his
filing was malicious.”); Howarth, 515 P.2d at 444 & n.1; First Sec.
Bank of Utah, 780 P.2d at 1257.
26 Howarth, 515 P.2d at 444; see also First Sec. Bank of Utah, 780
P.2d at 1257.
27 First Sec. Bank of Utah, 780 P.2d at 1257.
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Opinion of the Court
still encumbered the property and was in default. 28 These
statements were both disparaging and false. Because SMCRT
ratified his actions, 29 Mr. Rood was acting as an authorized agent
when he sold the property to the Dillons and accepted their
payment to discharge the trust deed. Therefore, the Gramuglia
loan was not enforceable as an encumbrance against the Park City
Property. 30 Since (1) the statements were false and (2) SMCRT
published that false information, the next question is whether
SMCRT acted with malice.
¶ 38 The undisputed facts show that SMCRT knew that the
information disparaging the Dillons’ title was false and SMCRT
should reasonably have foreseen, under the circumstances, that
publishing that information “might result” in damage to the
Dillons. 31 This constitutes implied malice.
¶ 39 As discussed, SMCRT filed a lawsuit against Mr. Rood,
which had the effect of ratifying his actions with respect to the
sale of the property to the Dillons. 32 This lawsuit also
demonstrates that SMCRT had actual knowledge that the loan
had been released from the property. When SMCRT disparaged
the Dillons’ title, it is undisputed that it had already initiated legal
proceedings against Mr. Rood and Level One to recover the
Dillons’ $250,000 payment, a payment that the Dillons made to
release the loan and take clear title to the property. It is also
undisputed that SMCRT filed the Rood Action to obtain, among
other things, the Dillons’ payment. Therefore, SMCRT had actual
knowledge that the loan had been discharged because they
asserted in the Rood Action that they knew of and accepted the
consequences of the discharge of the loan. Yet, despite this
28These statements were made between August and
November 2008, with the filing of the “Notice of Default” on
August 15, 2008.
29 See supra Part I.
30 SMCRT filed suit against Mr. Rood to recover the payoff
amount in May 2008 and attempted to foreclose on the Park City
Property in November 2008.
31 First Sec. Bank of Utah, 780 P.2d at 1257.
32 Supra ¶¶ 32–33.
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knowledge, and despite privately acknowledging that the Dillons
were “innocent 3rd parties,” SMCRT still sought to foreclose on
the Park City Property.
¶ 40 As a result, the Dillons suffered damages, including,
among other things, legal fees they incurred to defend the
foreclosure action. Accordingly, all of the elements of slander of
title were satisfied by the undisputed facts. We thus clarify and
affirm the district court’s grant of summary judgment on slander
of title and hold that the Dillons are entitled to damages.
III. THE DISTRICT COURT PROPERLY AWARDED
DAMAGES TO THE DILLONS BUT ERRED
WHEN IT TREBLED ATTORNEY FEES
¶ 41 The final issues raised by SMCRT in this appeal concern
the district court’s award of attorney fees and costs to the Dillons.
SMCRT argues that the award was erroneous for a number of
reasons. First, it argues that the trust deed was valid and thus the
district court erred by awarding the Dillons fees for their
Recording Act claim 33 and their Trust Deed Act claim. 34 Second,
it argues that the district court erred when it trebled a portion of
the Dillons’ damages award and improperly included attorney
fees. 35 Third, SMCRT claims that the Dillons did not deserve an
attorney fees-based damages award because they have not paid
any fees—FATCO has, and FATCO cannot make a claim for fees
because subrogation does not apply. Finally, SMCRT argues that
the Dillons failed to properly apportion their claims.
¶ 42 The Dillons cross-appealed, challenging the district
court’s refusal to treble their attorney fees for the amounts
incurred after SMCRT reconveyed the property in December 2009.
The Dillons argue that they are entitled to trebled fees for the
entirety of this lawsuit, including the fees incurred after SMCRT
recorded the reconveyance. We disagree and hold that none of
the Dillons’ attorney fees should have been trebled.
¶ 43 We affirm the district court’s decision generally to
award fees under the Trust Deed Act (Utah Code section
33 UTAH CODE § 78B-5-826.
34 See UTAH CODE § 57-1-38(3).
35 See id.
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Opinion of the Court
57-1-38(3)) and the trust deed itself. But we reverse the district
court’s decision to treble the Dillons’ attorney fees under Utah
Code section 57-1-38(3)(a). Aside from the trebling of attorney
fees, we affirm the district court’s damages award. Accordingly,
we remand this case to the district court for recalculation of the
improperly trebled damages.
A. The Dillons Are Generally Entitled
to Attorney Fees and Costs
¶ 44 We agree with the district court’s conclusion that the
Dillons are entitled to fees and costs for (1) their claim under
section 57-1-38(3) of the Trust Deed Act and (2) their claim under
Utah Code section 78B-5-826 based on the attorney fee provision
of the trust deed itself.
1. The Dillons Are Entitled to Fees Under the Trust Deed Act,
Utah Code Section 57-1-38
¶ 45 Under Utah Code section 57-1-38(3),
A secured lender or servicer who fails to release the
security interest on a secured loan within 90 days
after receipt of the final payment of the loan is liable
to another secured lender on the real property or the
owner or titleholder of the real property for:
(a) the greater of $1,000 or treble actual damages
incurred because of the failure to release the
security interest, including all expenses incurred in
completing a quiet title action; and
(b) reasonable attorneys’ fees and court costs.
SMCRT argues that section 57-1-38(3) does not apply for a variety
of reasons. It argues that SMCRT never received payment, that
Mr. Rood lacked authority to modify the loan, that the payment
was not “final” within the meaning of section 57-1-38(3), and that
the statute of frauds required the modification and release to be in
writing. 36 We disagree and affirm the district court’s holding
36 SMCRT’s latter two arguments have been raised for the first
time on appeal and are thus unpreserved. SMCRT has not
provided any argument that an exception to the preservation rule
should apply and thus we will not address these claims. Patterson
v. Patterson, 2011 UT 68, ¶¶ 12–16, 266 P.3d 828 (“The policy of
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that the Dillons are generally entitled to damages and attorney
fees under Utah Code section 57-1-38(3).
¶ 46 Because SMCRT ratified Mr. Rood’s actions, 37 Mr. Rood
received the $250,000 final payoff as an agent of SMCRT. This
amount was a “final payment” under section 57-1-38(3) because
the trust deed beneficiary—SMCRT—via its agent, Mr. Rood,
“agree[d] for a sum certain to release a portion of the real
property pledged on the trust deed.” 38 Mr. Rood and the Dillons
agreed that for $250,000, the Gramuglia trust deed would no
longer encumber the Park City Property. Even after SMCRT
received final payment via Mr. Rood, it maintained that it had a
security interest in the Park City Property and directed the title
company not to reconvey the property. In other words, SMCRT
received the Dillons’ payoff in September 2007 but did not release
the trust deed and reconvey the Park City Property until
December 2009. We are not persuaded by any of SMCRT’s
defenses to liability under section 57-1-38(3). Therefore, we affirm
the district court’s conclusion that the Dillons are entitled to costs
and fees under the Trust Deed Act, Utah Code section 57-1-38(3).
2. The Dillons Are Entitled to Fees Under the Terms of the Trust
Deed Itself
¶ 47 The district court properly awarded damages to the
Dillons based on Utah Code section 78B-5-826, which states:
A court may award costs and attorney fees to either
party that prevails in a civil action based upon any
promissory note, written contract, or other writing
executed after April 28, 1986, when the provisions of
the promissory note, written contract, or other
writing allow at least one party to recover attorney
fees.
judicial economy is most directly frustrated when an appellant
asserts unpreserved claims that require factual predicates.”).
37 Supra ¶¶ 26–33.
38 UTAH CODE § 57-1-40.5(1)(a) (allowing partial reconveyance
of a trust deed, which is secured by more than one parcel of real
property when a beneficiary agrees to a sum certain for partial
release and such amount is paid).
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Opinion of the Court
SMCRT presented two positions on the district court’s award of
attorney fees under section 78B-5-826. On the one hand, SMCRT
argues that the district court improperly awarded section
78B-5-826 attorney fees to the Dillons based on their Recording
Act claim because that claim was based on the statute, not the
trust deed. But SMCRT agrees that section 78B-5-826 gave the
district court discretion to award attorney fees to the prevailing
party because the action was in part “based upon” a “promissory
note, written contract, or other writing.” 39
¶ 48 We recently clarified what it means for an action to be
“based upon” a contract for the purposes of Utah Code section
78B-5-826. “[A]n action is ‘based upon’ a contract under the
statute if a party to the litigation assert[s] the writing’s
enforceability as a basis for recovery.” 40 There is no doubt that
SMCRT is asserting the enforceability of the trust deed in this
case. Nor is there any dispute that the trust deed allows for its
holder to be reimbursed for attorney fees incurred in any
litigation “which may arise in respect” to the trust deed. SMCRT
was the holder of the trust deed by virtue of its beneficial
assignment from Level One. Therefore, had SMCRT been the
prevailing party in this action, it would have been entitled to
attorney fees under the trust deed. Accordingly, the district court
did not abuse its discretion in awarding the Dillons attorney fees
under Utah Code section 78B-5-826, as prevailing parties in this
litigation. We therefore affirm.
B. The District Court Erred When It Trebled
the Dillons’ Attorney Fees
¶ 49 In the end, the district court awarded the Dillons
$1,120,395.69 for attorney fees and costs. Part of the reason that
the award was so large is that the district court construed section
57-1-38(3) of the Utah Code to allow for the trebling of attorney
fees. The Dillons argue that this decision was proper because the
statute provides for the recovery of “treble actual damages
incurred because of the failure to release the security interest,
including all expenses incurred in completing a quiet title
39 UTAH CODE § 78B-5-826.
40 Insight Assets, Inc. v. Farias, 2013 UT 47, ¶ 24, __ P.3d __
(alterations in original) (internal quotation marks omitted).
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action,” 41 which they believe includes attorney fees. SMCRT, on
the other hand, argues that because the statute contains a separate
clause discussing attorney fees and court costs, the district court
erred by including attorney fees within the trebled award. We
agree with SMCRT and remand for the district court to recalculate
damages.
¶ 50 Section 57-1-38(3) of the Utah Code provides:
A secured lender or servicer who fails to release the
security interest on a secured loan within 90 days after
receipt of the final payment of the loan is liable to
another secured lender on the real property or the
owner or titleholder of the real property for:
(a) the greater of $1,000 or treble actual damages
incurred because of the failure to release the security
interest, including all expenses incurred in completing
a quiet title action; and
(b) reasonable attorneys’ fees and court costs.
The question of whether the “actual damages incurred” referred
to in subsection (3)(a) includes attorney fees is a matter of
statutory interpretation. When interpreting a statute, we look to
the plain language first, “recognizing that our primary goal is to
give effect to the legislature’s intent in light of the purpose the
statute was meant to achieve.” 42 When completing textual
analysis, we “avoid interpretations that will render portions of a
statute superfluous or inoperative.”43 We also “seek to render all
parts thereof relevant and meaningful.” 44 Thus, the plain
language of specific provisions should be read harmoniously with
that statute’s other provisions. 45 If we have reviewed the statute’s
41 UTAH CODE § 57-1-38(3)(a).
42 In re Reinhart, 2012 UT 82, ¶ 17, 291 P.3d 228 (internal
quotation marks omitted).
43 Hall v. Utah State Dep’t of Corr., 2001 UT 34, ¶ 15, 24 P.3d 958.
44 Id. (internal quotation marks omitted).
45 Lyon v. Burton, 2000 UT 19, ¶ 17, 5 P.3d 616.
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Opinion of the Court
structure and plain language and the provision is ambiguous,
only then will we look to legislative history for guidance. 46
¶ 51 Under these basic principles of statutory interpretation,
we conclude that subsection 3(a)’s reference to “all expenses” does
not include attorney fees. Although the Dillons’ interpretation is
plausible, it is foreclosed by the legislature’s inclusion of
subsection 3(b) because if 3(a) were to include attorney fees, 3(b)
would be rendered superfluous. Contrary to the Dillons’
argument, the legislature’s inclusion of subsection 3(b) indicates
the legislature’s intent to carve out attorney fees from the
“expenses” that can be trebled under 3(a). That is, had the
legislature intended for attorney fees to fall under the purview of
subsection 3(a), it would not have included 3(b) at all. But since it
did include subsection 3(b), 3(a)’s reference to “all expenses”
cannot be read to include attorney fees.
¶ 52 The Dillons argue that if attorney fees are not
recoverable under subsection 3(a), “then the expenses to be
trebled will be essentially zero because there are no other material
expenses in a quiet title action.” But this argument is based upon
a misreading of the statute, which provides for the recovery of
“damages incurred because of the failure to release the security
interest,” of which “all expenses incurred in completing a quiet
title action” 47 are but a part. Such damages could include, for
example, lost profits if a seller is unable to perform under a real
estate purchase contract because her lender refuses to timely
release the lien. Thus, we are not persuaded by the Dillons’
argument that “the expenses to be trebled will be essentially zero”
if attorney fees are not recoverable under Utah Code section 57-1-
38(3)(a).
¶ 53 The Dillons also try to distinguish between subsection
3(a) and 3(b) by arguing that 3(a)’s reference to “damages” can
include attorney fees without rendering 3(b) superfluous because
3(b) is only concerned with attorney fees incurred in recovering the
damages referred to in 3(a). In other words, the Dillons argue that
section 57-1-38(3) allows for the recovery of attorney fees under
subsection 3(b) that were incurred while attempting to recover
46 Id.
47 UTAH CODE § 57-1-38(3)(a).
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damages under 3(a), which were comprised of attorney fees. This
argument is unavailing, since either subsection 3(a) or 3(b) would
still be superfluous. Had the legislature meant to allow triple
attorney fees, it would not have expressly provided for the
recovery of those fees in a separate provision.
¶ 54 For these reasons, we conclude that attorney fees are not
recoverable and thus cannot be trebled under subsection 3(a).
Accordingly, we hold that the district court erred when it trebled
attorney fees along with all of the Dillons’ other damages. We
remand to allow the district court to recalculate that portion of the
damage award consistent with this opinion.
C. The Dillons Are Entitled to an Award of Attorney Fees
for Fees Paid by FATCO
¶ 55 SMCRT argues that the Dillons are not entitled to
attorney fees in this action because FATCO has paid all of the
attorney fees and has neither subrogated its claim nor is a party to
this action. SMCRT couches its argument in terms of subrogation,
and argues that FATCO failed to satisfy the fourth element
required for subrogation: that the entire debt be paid. The
Dillons argue that subrogation is irrelevant and frame the issue as
simply whether fees are recoverable by an insured even if a
nonparty insurer paid those fees—an issue of first impression in
Utah. FATCO was contractually obligated under the trust deed to
defend the Dillons against SMCRT’s foreclosure.
¶ 56 While we have not specifically determined whether an
insured can recover attorney fees paid for by a nonparty (insurer
or otherwise), we have never required a party recovering fees to
provide proof that they have paid or will pay the attorney fees
incurred. Rather, our inquiry has always been limited to whether
the overall attorney fees awarded to a party are reasonable. 48 And
for good reason. Failure to award attorney fees to a prevailing
party, for the sole reason that there is insurance coverage or a
generous benefactor, would give the nonprevailing party “an
undeserved windfall. . . . [And] [w]hy should a nonprevailing
[party] be afforded any fortuitous benefit from such
48See Strohm v. ClearOne Commc’ns, Inc., 2013 UT 21, ¶ 51, 308
P.3d 424; Softsolutions, Inc. v. Brigham Young Univ., 2000 UT 46,
¶¶ 47–48, 1 P.3d 1095.
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Opinion of the Court
circumstances?” 49 Put another way, “[w]hen a party’s insurer is
providing [legal aid] and coverage, the party and the insurer are,
to the limits of the coverage, one party [act]ing under the name of
the insured. The benefits flowing from a party’s insurance
coverage flow in favor of the insured party, not the adverse
party.”50 Additionally, to hold otherwise would require district
courts to delve into the financial arrangements between attorneys
and clients, far beyond the scope of the litigation—a task we
refuse to impose on district courts. Accordingly, FATCO’s
fulfillment of its contractual obligation by paying the attorney fees
in defending the Dillons’ title is not a barrier to recovery of those
fees. We now turn to SMCRT’s challenge of the reasonableness of
the attorney fees award.
D. The District Court Otherwise Properly
Calculated the Fee Award
¶ 57 SMCRT presents two challenges to the district court’s
method of calculating the fee award—that the Dillons failed to
properly allocate their fees among successful claims, unsuccessful
claims, and claims for which there is no entitlement to attorney
fees; and that the award was unreasonable because the district
court included work performed that was not “reasonably
necessary to adequately prosecute the matter.” 51
¶ 58 SMCRT’s first challenge is based on the sufficiency of the
evidence. 52 As the Dillons correctly point out, the district court
made extensive findings of fact with regard to the allocation of
fees, and SMCRT failed to marshal the evidence to challenge the
sufficiency of the evidence supporting these findings, as required
by Utah Rule of Appellate Procedure 24(a)(9). Because SMCRT
failed to marshal, we are not persuaded that there was an
inadequate evidentiary basis for the attorney fees award.
49Aspen v. Bayless, 564 So. 2d 1081, 1083 (Fla. 1990) (internal
quotation marks omitted).
50 Ferrer v. Ngo, 73 P.3d 73, 80 (Haw. Ct. App. 2003).
51 Dixie State Bank v. Bracken, 764 P.2d 985, 990 (Utah 1988).
52 SMCRT argues “[g]iven the inadequate evidentiary basis for
an award under the circumstances, the court abused its discretion
in failing to deny fees altogether.”
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¶ 59 “An appellant cannot demonstrate that the evidence
supporting a factual finding falls short without giving a candid
account of that evidence.” 53 “Formal briefing requirements aside,
an argument that does not fully acknowledge the evidence
supporting a finding of fact has little chance, as a matter of logic,
of demonstrating that the finding lacked adequate factual
support.” 54 Because SMCRT has failed to carry its burden to
demonstrate that the evidence supporting the district court’s
findings is insufficient, we reject this claim on appeal.
¶ 60 SMCRT also challenges the award of attorney fees for
the time period after it reconveyed the trust deed in December
2009. SMCRT argues that the relief the Dillons sought was clear
title, which they received as a result of the reconveyance;
therefore, fees thereafter were not “reasonably necessary to
adequately prosecute” the Dillons’ claim for clear title. SMCRT’s
argument is unavailing. While SMCRT may have reconveyed the
trust deed prior to judgment in this case, it continued to argue the
enforceability of the trust deed even on appeal. Given these facts,
the district court did not abuse its discretion when it included
attorney fees incurred after the reconveyance.
E. The Dillons’ Fees on Appeal
¶ 61 As a final matter, we address the Dillons’ claim that they
are entitled to an award of attorney fees incurred on appeal. We
have “interpreted attorney fee statutes broadly so as to award
attorney fees on appeal where a statute initially authorizes
them.” 55 Additionally, when a party is entitled to attorney fees
below and prevails on appeal, that party is “also entitled to fees
reasonably incurred on appeal.” 56 Therefore we hold that the
Dillons are entitled to receive the attorney fees that they
reasonably incurred on appeal.
53 State v. Mitchell, 2013 UT App 289, ¶ 31, 318 P.3d 238.
54 Id. (internal quotation marks omitted).
55 Valcarce v. Fitzgerald, 961 P.2d 305, 319 (Utah 1998).
Id.; see also R.T. Nielson Co. v. Cook, 2002 UT 11, ¶ 27, 40
56
P.3d 1119.
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Opinion of the Court
CONCLUSION
¶ 62 We hold that SMCRT ratified Mr. Rood’s actions and so
affirm the district court’s grant of summary judgment on all
related claims. We also affirm the district court’s grant of
summary judgment in favor of the Dillons on slander of title but
clarify that slander of title requires actual knowledge of falsity.
Finally, we hold that the district court correctly determined that
the Dillons were en titled to recover damages, including attorney
fees and costs, under section 57-1-38(3) of the Utah Code and
under the trust deed itself. The district court erred, however,
when it concluded that Utah Code section 57-1-38(3) permits the
trebling of attorney fees. Accordingly, we remand this case to the
district court so that the fee award can be recalculated in a manner
consistent with this opinion. We also instruct the district court to
calculate and award the Dillons the attorney fees that they have
reasonably incurred on appeal.
26