Anita Kay Williams and W.A. Williams, her Husband; and James G. LaFont, Plaintiffs/Respondents, v. Sherman Kimes and Elaine Kimes, Husband and Wife, Individually and as Trustees of the Kimes Family Trust, dated November 27, 1990; and A.W. Kimes and Nina Kimes, Husband and Wife, Defendants/Appellants.

This slip opinion is subject to revision and may not reflect the final opinion adopted by the Court. Opinion Missouri Court of Appeals Southern District Case Style: Anita Kay Williams and W.A. Williams, her Husband; and James G. LaFont, Plaintiffs/Respondents, v. Sherman Kimes and Elaine Kimes, Husband and Wife, Individually and as Trustees of the Kimes Family Trust, dated November 27, 1990; and A.W. Kimes and Nina Kimes, Husband and Wife, Defendants/Appellants. Case Number: 22181 Handdown Date: 10/29/1998 Appeal From: Circuit Court of Mississippi County, Hon. David C. Mann Counsel for Appellant: W. Edward Reeves Counsel for Respondent: J. Michael Payne Opinion Summary: None Citation: Opinion Author: James K. Prewitt, Presiding Judge Opinion Vote: AFFIRMED. Crow and Barney, JJ., concur. Opinion: This is a continuation and perhaps the final chapter in a dispute regarding seventy-two acres sold at a foreclosure sale in 1988. That sale was held not to extinguish the right of persons holding a contingent remainder following a life estate, as they were not notified of the sale pursuant to Section 443.325.3(2), RSMo 1994. Williams v. Kimes, 949 S.W.2d 899 (Mo.banc 1997). The trial court's initial judgment was reversed and the cause remanded with directions that the claims for damages, credits, and other relief be "remanded to the trial court for proceedings in accordance with sec. 527.150, Subd. 2." 949 S.W.2d at 901. Thereafter in the trial court, Defendants-Appellants sought, among other relief "recoupment of the purchase price at the now-invalidated foreclosure sale together with interest on their purchase price from 1988 . . . and the imposition of an equitable lien upon the 72-acre tract." The trial court denied this request. Defendants appeal. Their point relied on is set forth marginally.(FN1)

Defendants cite numerous cases which they assert stand for the proposition that following an invalid foreclosure sale, the purchaser is entitled to be returned to the status quo he was in previous to the sale. We are convinced that those cases do not support Defendants, as here the sale was not invalid, but Defendants purchased only a life estate which ceased upon the death of Reba Wrather LaFont in 1993. Defendants apparently attempted to purchase the land in fee simple but at least the lack of notice to those holding a contingent remainder prevented Defendants from acquiring the fee. Some of the cases set forth in Defendant's brief are set forth marginally.(FN2) Emphasizing that the Supreme Court remanded to determine the parties' legal and equitable rights following Section 527.150.2, RSMo 1994, Defendants contend that the trial court denied the most significant aspect of their legal rights by determining that Defendants bought a life estate. They contend that equity requires that they be reimbursed, as they did not purchase what they intended. Under the evidence, Defendants should have recognized a risk in proceeding as they did, and they participated in what could be regarded as a scheme to cut out the contingent remainder holders. Reba Wrather LaFont was not able to convey the fee and wished to have the property sold and the encumbrance on it satisfied. Defendant Sherman Kimes agreed with her to bid at the foreclosure sale a price she set. Thereafter, there was a "friendly foreclosure" and the bank holding the note and deed of trust did not bid. Apparently no one else did. We agree with Plaintiffs that the equities are not on the side of those who may attempt by such a foreclosure to eliminate the interest of persons holding a contingent remainder. This matter is controlled by Michie v. Nat'l Bank of Caruthersville, 558 S.W.2d 270, (Mo.App. 1977). There, the purchasers of property at a foreclosure sale sued the foreclosing creditor seeking rescission and return of their purchase price. The debtor who executed the deed of trust owned only a life estate. The predecessor to this District held that caveat emptor applies to foreclosure sales and denied Plaintiffs' claim. Defendants' attempt to distinguish Mitchie, as the court there held there was no defect in the sale. The Plaintiffs in Mitchie bought a life estate because that was all the debtor owned to mortgage, whereas here, Defendants claim they bought a life estate only because of a defect in the foreclosure sale due to lack of notice. The parties agree, and for the purposes of this opinion we assume to be true, that except for the lack of notice, Defendants would have acquired a fee simple interest and the contingent remainder interests extinguished. Both here and in Mitchie, however, the purchaser attempted to purchase the fee but was not able to do so. In both cases, it appears that the purchasers knew, or could have discovered, the situations resulting in only life estates being purchased. We conclude the principles stated in Mitchie apply here.

Defendants purchased a life estate, used the property for several years, but not as long as they might have anticipated, based on Reba Rather LaFont's life expectancy at the time of the purchase. There may be, as Defendants assert, a "windfall" to Plaintiffs. We conclude, however, that this is a risk Defendants took when they attempted to eliminate the contingent remainder. Had Defendants' actions been successful, then Plaintiffs would have lost their interest in the land through no apparent fault of their own. If there is a windfall to Plaintiffs, Defendants are hardly in a position to complain. The judgment is affirmed. Footnotes: FN1.The trial court erred in entering judgment in favor of the Williams and against the Kimes on the Kimes' claim for recoupment of their 1988 foreclosure sale purchase price for the subject real estate (together with interest and less a credit for fair rental value of the property) and for the imposition of an equitable lien against the property to secure payment of same because the Supreme Court in the initial appeal of the matter invalidated the foreclosure sale as to the Williams' remainder fee interest and parties to an ineffective foreclosure sale are entitled to be restored to their status quo ante positions in that the Kimes effectively satisfied an indebtedness of the Williams (and their predecessors in interest) to which the real property would have been subject even if the Williams had received personal notice of the foreclosure sale, and the trial court's failure to allow recoupment of their purchase price by the Kimes resulted in a windfall "gift" of 72-acres of real property to the Williams without payment on their part of either the federal estate tax liability or the bank loan indebtedness associated with the property, which was paid by the Kimes. FN2.Kennon v. Camp, 353 S.W.2d 693 (Mo. 1962); Decker v. Evans, 221 S.W.2d 127 (Mo. 1949); Cordia v. Matthes, 130 S.W.2d 597 (Mo. 1939); Smith v. Holdoway Constr. Co., 129 S.W.2d 894 (Mo. 1939); McNatt v. Maxwell Investment Co., 50 S.W.2d 1040 (Mo. 1932); Scheer v. Trust Co. of St. Louis, 49 S.W.2d 135 (Mo. 1932); Young v. Kansas City Life Ins. Co., 43 S.W.2d 1046 (Mo. 1931); Ess v. Griffith, 30 S.W. 343 (Mo. 1895); IPI Liberty Village Associates v. Spalding Corners Associates, 751 S.W.2d 120 (Mo.App. 1988); Wakefield v. Dinger, 135 S.W.2d 17 (Mo.App. 1939). Separate Opinion: None This slip opinion is subject to revision and may not reflect the final opinion adopted by the Court.