Justia South Carolina Supreme Court Opinion Summaries

Stephen E. Lipscomb ("Appellant"), the manager of SEL Properties, LLC ("SEL") appealed a jury verdict against him for tortious interference with a contract entered into by SEL with Dutch Fork Development Group, II, LLC and Dutch Fork Realty, LLC (collectively "Respondents"). Appellant contended that he could not be held individually liable in tort for a contract that was breached by SEL. Alternatively, Appellant challenged the jury's award of $3,000,000 in actual damages to Respondents on grounds: (1) that the trial judge erred in charging the jury that lost customers and lost goodwill were elements of damages as there was no evidence of such damages; and (2) that the award was improper and should have been reduced as the actual damages for the tort claim were "coextensive" with or subsumed in the jury's award of actual damages to Respondents for the breach of contract claim against SEL. Upon review, the Supreme Court found that Appellant was entitled to a directed verdict as to the claim of tortious interference with a contract. Accordingly, the Court reversed the jury's award of damages. View "Dutch Fork Development v. SEL Properties" on Justia Law

Appellant RFT Management Co., L.L.C. (RFT) brought this action against respondents Tinsley & Adams, L.L.P. and attorney Welborn D. Adams (collectively, Law Firm) based on their legal representation of RFT during the closing of its purchase of two real estate investment properties in Greenwood County. RFT alleged claims for (1) professional negligence (legal malpractice), (2) breach of fiduciary duty, (3) violation of the South Carolina Unfair Trade Practices Act1 (UTPA), and (4) aiding and abetting a securities violation in contravention of the South Carolina Uniform Securities Act of 2005 (SCUSA). The trial court granted a directed verdict in favor of Law Firm on RFT's causes of action regarding the UTPA and SCUSA, and it merged RFT's breach of fiduciary claim with its legal malpractice claim. The jury returned a verdict in favor of Law Firm on RFT's remaining claim for legal malpractice. RFT appealed, and the Supreme Court certified the case from the Court of Appeals for its review. Upon review of the matter, the Supreme Court affirmed the trial court with respect to all issues brought on appeal. View "RFT Management Co. v. Tinsley & Adams" on Justia Law

Two issues came before the Supreme Court in this case: (1) whether an assignee of a note and mortgage has a right to surplus funds generated by the foreclosure of a prior mortgage on the property; and (2) whether that assignee is barred from recovering the surplus funds because the note and mortgage assigned to it allegedly were closed without attorney participation. Upon review, the Supreme Court held that the assignee may recover the surplus funds even though it was not a lienholder of record at the time of the sale. The Court took the opportunity of this case to clarify its decision in "Matrix Financial Services Corp. v. Frazer," (714 S.E.2d 532 (2011)), and held that because the mortgage at issue in this case was filed before "Matrix," whether it was closed without the services of an attorney would not bar the assignee from receiving the surplus funds. View "BAC Home Loan Servicing, L.P. v. Kinder " on Justia Law

Brentwood Homes, Inc. and the other appellants in this case (collectively "Brentwood Homes") appealed a circuit court's order denying a motion to stay the proceedings and compel arbitration in a lawsuit filed by Petitioner Fred Bradley that arose out of his purchase of a home in South Carolina. Although Brentwood Homes conceded the Home Purchase Agreement did not meet the technical requirements of the South Carolina Uniform Arbitration Act (the "UAA"), it claimed the court erred in denying the motion because the transaction involved interstate commerce and thus was subject to the Federal Arbitration Act ("FAA"). Upon review, the Supreme Court concluded that because the essential character of the Agreement was strictly for the purchase of a completed residential dwelling and not the construction, the Court found the FAA did not apply. Furthermore, the existence of the national warranty and Bradley's use of out-of-state financing did not negate the intrastate nature of the transaction. Accordingly, the Court affirmed the circuit court's order denying Brentwood Homes' motion to stay the proceedings and compel arbitration as Brentwood Homes failed to offer sufficient evidence that the transaction involved interstate commerce to subject the Agreement to the FAA. View "Bradley v. Brentwood Homes" on Justia Law

William Watson Eldridge III (Father) created two trusts for the ultimate benefit of his sons, William Watson Eldridge IV (Bill) and Thomas Hadley Eldridge (Tom). In 1973, Father formed a revocable trust (R-trust), for which he was the trustee. When Mother died in 1992, Father amended the R-trust to name Bill and Tom as co-successor trustees. In 1999, Father formed an irrevocable Qualified Personal Residence Trust (QPRT), for which he was trustee, and placed in it a Florida condominium (Florida condo) that he owned. Under the terms of the QPRT, Father could sell the Florida condo, but use of the proceeds was limited to the purchase of a replacement home to be placed in the trust, or the purchase of a separate annuity for the benefit of the trust. The trust document named Sons as co-successor trustees of the QPRT. The terms of the QPRT also provided that if Father died within eight years after its formation, the trust assets were to automatically transfer to the R-trust, of which Sons were beneficiaries. If Father was still living eight years after the formation of the QPRT, the trust assets were to be distributed equally among Sons. Father married Frances Eldridge (Wife) in 2001. Acting as trustee of the QPRT trust, Father sold the Florida condo and used the sales proceeds to buy a Hilton Head home. Instead of titling the Hilton Head home in the name of the QPRT trust, as required under the terms of the trust, he titled it in the name of the R-Trust. In 2003, Father transferred the Hilton Head home from the R-trust to himself and Wife, individually, as joint tenants with the right of survivorship. Father died in 2006, and under the right of survivorship, Wife's sole interest in the Hilton Head home became fully vested. Subsequently, she transferred title in the home to herself as trustee of the Frances Ulmer Eldridge Revocable Trust, of which Wife's children are the beneficiaries at her death. Bill and Tom, as trustees of the R-trust, filed suit against Wife and her trust, claiming that the Hilton Head home was held in either a constructive or a resulting trust for the benefit of the R-trust, and requesting the court to transfer the Hilton Head home to the R-Trust. After a bench trial, the master-in-equity issued judgment in favor of Wife. Upon review, the Supreme Court found that the Sons did not have an adequate legal remedy to cure Father's breach of trust. The law of the case was that a resulting trust arose over the Hilton Head home for the benefit of the R-Trust. Because the Sons filed a claim against Wife and her trust just over a year after Father's death, the Court held that laches could not apply to bar the Sons' claim. Accordingly, the Court reversed and remanded with direction that Respondents execute all documents necessary to re-transfer the Hilton Head home to the R-Trust. View "Eldridge v. Eldridge" on Justia Law

Respondent Hook Point, LLC (Hook Point) was granted a preliminary injunction preventing Appellant Branch Banking and Trust Company (BB&T) from drawing on, and Defendant First Reliance Bank (First Reliance) from honoring, a $1.5 million letter of credit. BB&T appealed. In late 2007, Hook Point sought a loan from BB&T for the purpose of developing a subdivision on property Hook Point owned on Lake Murray called Panama Pointe. BB&T issued a commitment letter to Hook Point in September 2007 indicating that it would loan the company $5.1 million and establish a $2 million line of credit to enable Hook Point to develop the subdivision. Security for the loan included a first mortgage on the Panama Pointe property, personal guarantees of Hook Point’s four principals, and a $1.5 million standby letter of credit issued by First Reliance in favor of BB&T. On December 23, Hook Point filed suit alleging several causes of action against BB&T, including for fraudulent misrepresentation by which BB&T induced Hook Point to enter into a loan agreement. Hook Point admitted to being $70,000 in arrears on interest but argued that the terms of the agreement did not permit BB&T to draw the full amount of the letter of credit (LC) if that exceeded the amount of interest due. It also sought an ex parte temporary restraining order to prevent First Reliance from honoring a draft on the LC by BB&T, which the court granted. After a hearing, the court also granted a preliminary injunction against drafts on or honor of the LC beyond amounts of accrued interest, requiring extension of the LC for one year, and requiring Hook Point to post a $50,000 bond with the court. The Supreme Court reversed the circuit court's grant of the injunction: "[t]he standard under which a fraud in the transaction claim must be measured when deciding whether to enjoin honor of a letter of credit requires that the beneficiary have no colorable claim or basis in fact for asserting its rights under the letter of credit. In this case BB&T has, in [the Court's] view, not only a colorable claim but an undeniable basis in fact for asserting its rights under the letter of credit. Therefore, the circuit court erred when it granted the preliminary injunction." View "Hook Point v. Branch Banking" on Justia Law

Appellant East Cherry Grove Realty Co., LLC, appealed a jury verdict which found that South Carolina held title to certain disputed canals in North Myrtle Beach. The question was submitted to the jury on three theories: that two quitclaim deeds established title in the canals; that the canals had been dedicated to the public; and that the State held title to the canals in trust for the public. The jury returned a verdict for the State on all three theories. Appellant argued that the trial court erred when it denied Appellant’s motions for directed verdict on each theory. Upon review, the Supreme Court found that the question of ownership under the quitclaim deeds was properly submitted to the jury and therefore affirmed the verdict. View "City of North Myrtle Beach v. East Cherry Grove Realty" on Justia Law

In 1969, the State sued Appellant Yelsen Land Company alleging that the State owned "all tidelands, submerged lands, and waters" adjacent to Morris Island.  Appellant answered and claimed it owned all the tidelands, submerged lands, and marshes adjacent to Morris Island. Appellant also counterclaimed for trespass on those lands by the Corps of Engineers in the form of spoilage dredged from Charleston Harbor, the digging of a ditch, and the erection of a dike. In the first appeal, the Supreme Court held that the legal questions of title to the land should be tried to a jury and that the trial judge erred in denying the State a jury trial. The jury returned a general verdict for the State, having been charged that title to tidelands, submerged lands, and all land below the high water mark on navigable streams were presumptively the State's unless the entity claiming title can show a specific grant from the sovereign that included the words "to the low water mark."  It was also charged that it was to determine title to marshlands and to return damages for appellant if it found the State had trespassed on marshland owned by appellant or if it found a taking. Following the jury verdict, Appellant moved for a judgment non obstante verdicto and a new trial, both of which the trial judge denied in a written order. In 2007, Appellant brought this suit against the State contending that the dredging spoils placed in the tidelands had created new highlands, and that as the adjacent highland owner, it was the owner of the newly “accreted” highlands as well.  The State Ports Authority (SPA) sought to intervene, but in lieu of intervention, Appellant was permitted to amend its complaint to add the SPA. A Master granted the State and the SPA summary judgment, and Appellant appealed.  The Supreme Court affirmed, finding res judicata applied to bar Appellant's attempt to relitigate title to the property. View "Yelsen Land Company v. South Carolina" on Justia Law

The property which was the subject of this appeal was owned by Appellant Peggy McMaster and located in the City of Columbia in the immediate vicinity of the University of South Carolina. Pursuant to the Ordinance, only one "family" may occupy a single dwelling unit. At the time this dispute arose, the property was occupied by four unrelated individuals—Appellant Gray McGurn and three other young women, all of whom were undergraduate students at the University of South Carolina. After receiving a neighborhood complaint, the City's Zoning Administrator conducted an investigation and determined the occupants violated the Ordinance. McMaster appealed the violation notice to the City's Board of Zoning Appeals arguing the Ordinance was not violated and in the alternative, the Ordinance was unconstitutional. Following a hearing, the Board affirmed the zoning violation. Appellants appealed the Board's decision to the circuit court. The circuit court found the Ordinance's definition of "family" did not violate the Due Process Clause of the South Carolina Constitution. Following its review, the Supreme Court found the Ordinance was a valid exercise of the City's broad police power and that there was a rational relationship between the City's decision to limit the number of unrelated individuals who may live together as a single housekeeping unit and the legitimate governmental interests of controlling the undesirable qualities associated with "mass student congestion." View "McMaster v. Columbia Board of Zoning" on Justia Law

Petitioner All Things Possible, Inc. (ATP) sold an undeveloped lot to Respondents Michael and Marsha Moseley. The lot was burdened by an underground, surface-water drainage easement running diagonally across the entire length of the property, essentially cutting the lot in half. ATP, through its agents, was aware of the Moseleys' desire to build a home on the lot. According to the Moseleys, they "absolutely" relied upon the falsified plat in purchasing the lot, together with assurances from ATP related to the Moseleys' ability to build on the lot. As noted by the court of appeals, the Moseleys were induced to purchase the lot without obtaining an independent survey of the property. Conversely, the real estate contract contained standard provisions, including the right of the Moseleys to conduct a title examination and procure a survey of the lot. After purchasing the lot, the Moseleys learned of the easement and the resulting inability to build a home suited to their needs. The Moseleys sued ATP alleging multiple causes of action, including fraud. The matter was tried nonjury solely on the fraud claim. The trial court found that fraud had been established by clear and convincing evidence and awarded actual and punitive damages against ATP. The judgment against ATP was affirmed. On appeal, ATP argued that there was no clear and convincing evidence that it engaged in fraud. Furthermore, ATP argued that the alleged misrepresentation was discoverable in the chain of title, and therefore, the Moseleys' claim should have failed as a matter of law. The Supreme Court disagreed: "constructive notice is 'inapplicable especially 'where the very representations relied on induced the hearer to refrain [from] an examination of the records.'" The Court affirmed the appellate court's decision. View "Moseley v. All Things Possible" on Justia Law