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Holmes Development, LLC v. Cook

Supreme Court of Utah
48 P.3d 895 (2002)


Cook Development (defendant) purchased a 323-acre parcel and a 73-acre parcel. Cook and Premier Homes together formed two companies, Lake Creek Farms (Farms) and Lake Creek Associates (Associates) for a development project. Cook conveyed the 323- and 73-acre parcels to Farms and Associates, respectively. When Cook and Premier ended their relationship, the companies agreed to convey both parcels back to Cook. However, the quitclaim deed conveying the larger parcel incorrectly identified Associates as the grantor rather than Farms. In May 1998, Cook sold both parcels via warranty deed to Holmes Development, LLC. In November, Premier, as manager for Farms, sold the 323-acre parcel to Keystone Development, LLC. Keystone sued to quiet title and recorded a lis pendens against the parcel. Although Keystone’s claim was defeated, the lis pendens prevented Holmes from selling any lots within the 323-acre parcel during the prime selling season while continuing to pay the bank that financed Holmes’s purchase of the land. Thus Holmes sued Cook for breach of the covenants of title. The trial court granted Cook summary judgment, holding that any breach was cured when Keystone’s claims were defeated. Holmes appealed.

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Holding and Reasoning (Russon, J.)

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