McNutt v. Estate of Barry D. McNutt

NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
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No. 09-4428
___________
KEVIN W. McNUTT; GLORIA J. McNUTT, H-W,
Appellants
v.
ESTATE OF BARRY D. McNUTT;
ANDREA H. KASARSKY, H-W, Individually and Jointly
____________________________________
On Appeal from the United States District Court
for the District of New Jersey
D.C. Civil Action No. 09-cv-00002
(Honorable Freda L. Wolfson)
________________________________________
Submitted Pursuant to Third Circuit LAR 34.1(a)
July 2, 2010
Before: SCIRICA, JORDAN and VANASKIE, Circuit Judges
Filed: July 7, 2010
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OPINION OF THE COURT
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PER CURIAM.
Kevin W. McNutt and Gloria J. McNutt (“Appellants”), husband and wife
proceeding pro se, appeal the order of the District Court denying their motion for
summary judgment, granting the appellees’ motion for summary judgment, and
dismissing the complaint. For the following reasons, we will affirm.
I.
This case arises out of an alleged oral agreement between Kevin McNutt and his
brother, Barry McNutt, regarding the ownership and upkeep of three lots of land. In the
1970s, appellants acquired a land parcel that had been owned by Kevin and Barry’s
parents, which was divided into three lots: Lot 25, 25.02, and 25.03. In 1984, appellants
sold Lot 25.03 to Equity Lenders Corporation to avoid foreclosure.
Appellants claim that Kevin took responsibility for Barry’s felony theft of
electrical services on the Lots in 1984. In exchange, they allege, they entered into an oral
“real estate contract” in 1987 (the “1987 Agreement”) with Barry at an attorney’s office 1 ,
wherein Barry agreed to (1) obtain a mortgage on Lot 25.02; (2) disburse funds from the
mortgage to appellants; (3) underwrite and pay for all maintenance and repair needs on
the Lots; and (4) satisfy the Equity Lenders mortgage on Lot 25.03.2 Three months before
the alleged agreement, Barry purchased Lot 25.02 from appellants for $130,000, paying
$30,000 in cash and obtaining a purchase money mortgage for the remaining $100,000.
1
The attorney declares that while both Kevin and Barry were clients of his, there
was never a meeting at his office.
2
Barry’s wife at the time, Martha Heisel, who appellants claim attended the
meeting with her father, now deceased, also declared that she did not attend any such
meeting and denied any knowledge of a contract between Kevin and Barry. She did state
that Barry had spoken of appellants’ money troubles and that Barry purchased a piece of
property to assist them.
2
Although Barry was the purchaser, appellants allege that they paid and satisfied the
mortgage in full in April 2002.3 Later in 1987, Barry purchased Lot 25.03 from Equity
Lenders for $29,400, paying $14,400 in cash and obtaining a purchase money mortgage
for the remainder. The mortgage is still unsatisfied, but no foreclosure or other collection
proceedings have commenced. Appellants produced sixteen checks from Barry to Kevin
between June 2001 and November 2003, totaling $21,571, the memo lines of which
indicate the payments were for equipment, repairs, and gifts.
Appellants allege that, in a 2003 three-way phone call between Barry, Barry’s wife
Andrea Kasarsky, and Kevin, Barry instructed Kasarsky to continue funding the 1987
Agreement.4 Barry died shortly thereafter; his will bequeathed Lots 25.02 and 25.03 to
Kevin. Appellants produced eight checks from Kasarsky to Kevin between November
2004 and May 2007, totaling $26,696.99, and six letters from Kasarsky, some of which
reference the checks. The memo lines indicate that the checks were for insurance, truck
expenses, and Christmas presents. Kasarsky declared that she sent money to Kevin out of
kindness and concern and that she encouraged Kevin to find work and earn income by
renting out the Lots. Eventually, Kasarsky declared, she refused to send any more money
to appellants after Kevin filed a construction lien against her in 2008.
3
The District Court noted that appellants submitted seven sporadically dated
checks signed by Gloria to Barry for $1,125.00 each. Because the court found for
appellees on other grounds, it did not reach the question whether appellants made any
payments on the mortgage.
4
Kasarsky denies that the 2003 phone call took place.
3
Appellants filed suit5 , raising claims for breach of contract and seeking damages in
the amount of $650,000 plus interest, plus punitive damages. They also sought an
unspecified amount to satisfy a mortgage on one of the lots of land in question. In a
strongly worded conclusion, the District Court dismissed the complaint with prejudice.
Appellants filed a timely appeal.
II.
We have jurisdiction under 28 U.S.C. § 1291. In reviewing a District Court’s
grant of summary judgment, we exercise plenary review, and apply the same standard that
the District Court is required to apply. Regents of Mercersburg Coll. v. Republic
Franklin Ins. Co., 458 F.3d 159, 163 (3d Cir. 2006); Fed. R. Civ. P. 56(c). Summary
judgment is proper when, viewing the evidence in the light most favorable to the non-
moving party and drawing all inferences in that party’s favor, there is no genuine issue of
material fact and the moving party is entitled to judgment as a matter of law. Celotex
Corp. v. Catrett, 477 U.S. 317, 322 (1986); Saldana v. Kmart Corp., 260 F.3d 228, 232
(3d Cir. 2001); Fed. R. Civ. P. 56(c). The party opposing summary judgment “may not
rest upon the mere allegations or denials of the . . . pleading,” but “must set forth specific
facts showing that there is a genuine issue for trial.” Saldana, 260 F.3d at 232 (internal
citations omitted).
5
Appellants filed suit in the Superior Court of New Jersey, Law Division,
Hunterdon County. Appellees removed the case to federal court. The District Court’s
jurisdiction was proper under 28 U.S.C. § 1332.
4
A factual dispute is genuine if there is a sufficient evidentiary basis on which a
reasonable jury could find for the non-moving party, and it is material only if it might
affect the outcome of the suit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986); Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir. 2006). A plaintiff’s
proffered evidence must be sufficient to meet the substantive evidentiary standard the jury
would have to use at trial. Anderson, 477 U.S. at 255. If appellants failed to “make a
showing sufficient to establish the existence of an element essential” to their case, and for
which they bear the burden of proof at trial, there can be no “genuine issue as to any
material fact,” and we must affirm the entry of summary judgment. Celotex, 477 U.S. at
322-23.
III.
After thorough review of appellants’ arguments on appeal, in light of the record,
we conclude that the District Court properly granted summary judgment for appellees.
Appellants alleged in the first two counts that Kasarsky has the responsibility, both
personally and as executrix of Barry’s estate, to continue to pay funds under the 1987
Agreement and that her failure to do so was intentional. Appellants may bring an action
for breach of contract against the estate and Kasarsky as its representative if they could
have brought the same action against Barry during his lifetime. See Flicker v. Chenitz,
150 A.2d 688, 692 (N.J. Super. Ct. App. Div. 1959). To establish that a valid contract
existed, a claimant must show that an offer, acceptance, and consideration existed, Cont’l
5
Bank of Pa. v. Barclay Riding Academy, Inc., 459 A.2d 1163, 1171-72 (N.J. 1983), and
that the parties reached a “meeting of the minds.” DeVries v. Evening Journal Ass’n, 87
A.2d 317, 318 (N.J. 1952).
We agree with the District Court that appellants have presented no documentary
evidence of the 1987 Agreement’s offer or acceptance. Because appellants’ case
“depends upon oral testimony with respect to statements or acts by . . . [Barry], . . . the
entire cause of action must be proven by clear and convincing evidence.” Chance v.
McCann, 966 A.2d 29, 48 (N.J. Super. Ct. App. Div. 2009) (applying New Jersey’s
“Dead Man’s Act,” N.J. Stat. Ann. § 2A:81-2). Appellants’ only evidence that the 1987
meeting took place and that an agreement was reached is their own self-serving
testimony. The other alleged attending witnesses denied ever participating in such a
meeting. Likewise, the checks for repairs, equipment, and gifts from Barry and Kasarsky
are sporadic and insufficient to prove the existence of a contract under a course of
conduct theory. Accordingly, we agree with the District Court that appellants have failed
to set forth facts showing that there is a genuine issue for trial. See Saldana, 260 F.3d at
232.
The District Court also properly found that even if the 1987 Agreement existed, it
would be unenforceable because it is illegal. See Duff v. Trenton Beverage Co., 73 A.2d
578, 584 (N.J. 1950); N.J. Stat. Ann. § 2C:29-4 (“A person commits a crime if he . . .
agrees to accept any pecuniary benefit in consideration of refraining from reporting to law
6
enforcement authorities the commission . . . of any offense”). As the District Court
reasoned, appellants’ alternate position is that Barry agreed to help his brother out of
kindness, which means he was not contractually obligated to do so.6
We also agree with the District Court that Kasarsky cannot be held personally
liable for the 1987 Agreement because she has received no consideration. Appellants
claim that Barry instructed Kasarsky to continue making payments pursuant to the 1987
Agreement after his death. They point to the eight checks and six letters Kasarsky wrote
to appellants as proof of her intent to be bound. However, an agreement to modify an
existing valid contract must be supported by consideration. Warner-Lambert Pharm. Co.
v. Sylk, 471 F.2d 1137, 1143 (3d Cir. 1972) (internal citations omitted). Appellants claim
Kasarsky received the benefit of the repairs they made to the Lots. However, Kasarsky
has never owned any of the Lots. Accordingly, we agree that, even presuming a valid
contract existed, Kasarsky never received any consideration that would bind her to a
modification, and as such, the 1987 Agreement is unenforceable against her.
In Counts Three and Four, appellants argue that Barry is the owner of record of
Lot 25.03; that Kasarsky, both personally and as executrix, is obligated to satisfy the
unpaid mortgage on that lot; and that her failure to do so is deliberate and intentional.
6
The District Court also considered that to the extent appellants raised a claim for
unjust enrichment, the claim fails because they cannot show that Barry unjustly retained
any benefit without payment. See VRG Corp. v. GKN Realty Corp., 641 A.2d 519, 526
(N.J. 1994).
7
The District Court properly denied these claims. For the reasons stated above, Kasarsky,
in either capacity, is not bound by the terms of the 1987 Agreement. Moreover, Kevin is
the owner of Lot 25.03, pursuant to Barry’s bequest.
Finally, in their brief to this Court, appellants argue that the estate should have
taken action to transfer title to Lots 25.02 and 25.03 to Kevin, and point to a letter from
Kasarsky in which she stated that she “hope[d]” to have titled transferred to him. They
claim that the District Court erred in failing exercise its equitable powers to clear title to
the lots, “free and clear of any mortgages.” Appellees correctly note that appellants did
not raise this claim below. As such, the claim is waived. See, e.g., Medical Protective
Co. v. Watkins, 198 F.3d 100, 105 n.3 (3d Cir. 1999); Barnes v. Am. Tobacco Co., 161
F.3d 127, 155 n.36 (3d Cir. 1998).
Accordingly, we will affirm the judgment of the District Court.
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