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Elk Ridge Lodge, Inc., A Wyoming Corporation v. George M. Sonnett

July 8, 2011

ELK RIDGE LODGE, INC., A WYOMING CORPORATION, APPELLANT (PLAINTIFF/THIRD-PARTY DEFENDANT),
v.
GEORGE M. SONNETT, JR. AND WENDY Z. BURGERS-SONNETT, HUSBAND AND WIFE, APPELLEES (DEFENDANTS/THIRD-PARTY PLAINTIFFS).
GEORGE M. SONNETT, JR. AND WENDY Z. BURGERS-SONNETT, APPELLANTS (DEFENDANTS/THIRD-PARTY PLAINTIFFS),
v.
DANIEL FOX AND TERRY REACH, AS INDIVIDUALS D/B/A ELK RIDGE LODGE, INC.;
AND ELK RIDGE LODGE INC., A WYOMING CORPORATION, APPELLEES (THIRD-PARTY DEFENDANTS).



Appeal from the District Court of Sublette County The Honorable Marvin L. Tyler, Judge

The opinion of the court was delivered by: Burke, Justice.

Before KITE, C.J., and GOLDEN, HILL, VOIGT, and BURKE, JJ.

NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming 82002, of any typographical or other formal errors so that correction may be made before final publication in the permanent volume.

[¶1] George M. Sonnett, Jr., and Wendy Z. Burgers-Sonnett purchased approximately twenty acres of land and improvements in Sublette County, Wyoming, from Elk Ridge Lodge, Inc. To finance part of the purchase price, the Sonnetts gave Elk Ridge a promissory note secured by a mortgage on the property. They later defaulted on the note, and Elk Ridge filed suit against the Sonnetts seeking judgment and foreclosure on the property. The Sonnetts responded with counterclaims against Elk Ridge. Both parties filed competing motions for summary judgment.

[¶2] The district court granted summary judgment in favor of Elk Ridge on its foreclosure claim, and against the Sonnetts on their counterclaims. In Docket No. S-10-0192, the Sonnetts appeal that decision. The district court also denied Elk Ridge's request for attorneys' fees and costs pursuant to the terms of the promissory note and mortgage. In Docket No. S-10-0191, Elk Ridge appeals that decision. We will affirm the district court's decisions in both appeals.

ISSUES

[¶3] The Sonnetts present these three issues in Docket No. S-10-0192:

1. Did the district court err in granting summary judgment to Elk Ridge, and in denying summary judgment to the Sonnetts, on the Sonnetts' counterclaim of breach of warranty (breach of the implied covenant against encumbrances), ruling, as a matter of law, that language contained in the deed of conveyance excluded a recorded encumbrance from Elk Ridge's warranty.

2. If the district court erred under issue 1, did the district court also err in granting summary judgment on Elk Ridge's claim for a money judgment and request for a decree of foreclosure where the Sonnetts' counterclaim may diminish or defeat Elk Ridge's claim?

3. Did the district court err by granting summary judgment to Elk Ridge on its request for the equitable relief of foreclosure where the Sonnetts invoked equity in defense and where the court made no findings as to the equities?

In Docket No. S-10-0191, Elk Ridge asserts a single issue:

The decision of the trial court, in denying Elk Ridge Lodge, Inc.'s motion for attorneys' fees and costs, was an abuse of discretion.

FACTS

[ΒΆ4] Harold and Leda Reach owned a substantial tract of property in Sublette County, Wyoming. In 1989, they applied to the county to change the zoning on a twenty-acre parcel of that property from Agricultural to Recreational, with the stated purpose of developing a lodge for resort use. In order to gain approval of the application during the hearing process, the Reaches offered a set of restrictive covenants entitled the "Proposed Masterplan of Elk Ridge Lodge Development." This proposed Master Plan restricted the use and development of the property more than the standard limitations placed on property with Recreational Zoning. The County accepted the Master Plan and approved ...


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