Bautista v Torres [2017] GUSC 17 (5 December 2017)

FRANCISCO TORRES, Individually and as the Previous Special Administrator and Now Executor of the Estate of Jesus U. Torres, Deceased, and PETER F. PEREZ,

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DANIEL U. TORRES and BARBARA M. DeMELLO,
Trustees under the Esteban Torres Family Trust Dated May 12, 1995,

Appeal from the Superior Court of Guam
Argued and submitted on June 1, 2017
Hagåtña, Guam

Appearing for Third-Party Defendant-Appellant: Joyce C.H. Tang, Esq. Leslie A. Travis, Esq. Civille & Tang, PLLC 330 Hernan Cortez Ave., Ste. 200 Hagåtña, Guam 96910 For Plaintiff-Intervenor-Appellees: Daniel J. Berman, Esq. Berman O’Connor & Mann Bank of Guam Bldg. 111 Chalan Santo Papa, Ste. 503 Hagåtña, Guam 96910	Appearing for Defendant-Appellees: John C. Terlaje, Esq. The Law Offices of John C. Terlaje, P.C. 194 Hernan Cortez Ave., Ste. 216 Hagåtña, Guam 96910

BEFORE: F. PHILIP CARBULLIDO, Presiding Justice^[1]; ROBERT J. TORRES, Associate Justice; ALBERTO E. TOLENTINO, Justice Pro Tempore.

PER CURIAM:
[1] Gloria C. Sholing appeals a final judgment of the Superior Court. Gloria Sholing contends the trial court erred by applying the law of the case doctrine to her counterclaims, by finding that her proposed claim for fraud was barred by the statute of limitations, and in deciding that her counterclaims were time-barred even under the doctrine of recoupment. She further argues the trial court abused its discretion by denying her motion for leave to file a second amended answer and counterclaims, and third-party cross-claims, by implication through entering final judgment. Appellees Daniel U. Torres and Barbara M. DeMello—trustees under the Esteban Torres Family Trust dated May 12, 1995—offer several rationales for affirming the judgment on other grounds in addition to defending the judgment on its own terms. For the reasons explained below, we reverse the Superior Court judgment in part, and remand for further consideration of Gloria Sholing’s arguments.

[2] The underlying case is sprawling, generating multiple appeals. See Bautista v. Torres, CVA16-020 (another appeal by Gloria Sholing’s siblings). It is also related to a probate matter, In re Estate of Jesus U. Torres, Superior Court Case No. PR0104-02, which itself has generated an appeal and writ case, see In re Estate of Jesus U. Torres, CVA17-005; Bautista v. Superior Court (Torres), WRP17-001. The facts we expound upon here are relevant to the instant appeal.
[3] In September 1967, the Sholing Family—siblings Rosario Bautista, Manuel Sholing, and Gloria Sholing (“Sholing Siblings”), and their mother Ana Sholing, acting individually and as attorney-in-fact for her children—signed a retainer agreement (the “1967 Agreement”) with attorney Jesus U. Torres (“Attorney Torres”). For $200.00 per month—payable October 1, 1967, through September 30, 1987—Attorney Torres agreed to handle legal matters related to the lease of several properties on which the Pacific Islands Club hotel is currently built (the “PIC Property”).
[4] Several days after the agreement was signed, Attorney Torres sent a letter to Manuel Sholing (the “1967 Letter”) explaining the terms of a lease he had negotiated. In that letter, he mentions his retainer fees under the 1967 Agreement, which he explains are “for my services and services that I have agreed to render in the future.” Record on Appeal (“RA”), tab 211, Ex. D (1967 Letter to Manuel Camacho Sholing as attached to Decl. of Leslie Travis, May 28, 2010).
[5] In October 1987, the same parties signed a new retainer agreement (the “1987 Agreement”). This agreement recognized that Attorney Torres had been retained for the preceding twenty years and created a new retainer agreement guaranteeing Attorney Torres ten percent of the annual rental of the PIC Property from October 1, 1987, through September 30, 2012. The amount to be paid under the 1987 Agreement was written to be “earned and vested” immediately and would be paid in full in consideration for Attorney Torres’s professional services rendered for as long as he was able to provide them. Record on Appeal (“RA”), tab 211, Ex. C (1987 Agreement as attached to Decl. of Leslie Travis).
[6] The 1987 Agreement states that during that same month of October, the Sholing Family entered into an agreement with the lessee of the PIC Property implementing escalation clauses to the Sholing Family’s benefit. Throughout this period, Attorney Torres sent periodic statements to the Sholing Family to inform them of the total rent collected and the amounts of taxes and legal fees deducted.
[7] Attorney Torres passed away in August 2002, and Ana Sholing passed away in September 2005.
[8] In April 2007, Rosario Bautista and Manuel Sholing filed a complaint against Francisco Torres, individually and as the previous special administrator and now executor of Attorney Torres’s estate (together, the “Estate”), and attorney Peter F. Perez (“Attorney Perez”) alleging breach of fiduciary duty, deceptive trade practices, and negligence, and requesting rescission and restitution. They subsequently amended their complaint three times.
[9] Daniel Torres and Barbara DeMello (“Heirs”) later intervened. They alleged breach of contract claims against the Sholing Siblings, bringing Gloria Sholing into the suit for the first time.
[10] Gloria Sholing filed an Answer, and later an Amended Answer and Counterclaims. Gloria Sholing alleged in her counterclaims against the Heirs that the 1987 Agreement was void for lack of consideration and was unconscionable; she also sought restitution. Gloria Sholing later moved to dismiss the Heirs’ complaint for lack of standing, and the court later did so.
[11] The Heirs filed a motion for summary judgment on Rosario Bautista and Manuel Sholing’s third amended complaint and Gloria Sholing’s counterclaims. The memorandum in support of that motion argued, among other things, that the statutes of limitation had run on the Sholing Siblings’ claims and that they should be further barred by laches. Gloria Sholing opposed the motion. The trial court took the matter under advisement.
[12] Gloria Sholing thereafter filed a motion for leave to file a second amended answer and counterclaim, and third-party cross-claims, seeking to assert, among other claims, that there was fraud in the inducement of the 1987 Agreement. She argued that the 1967 Letter, disclosed to her during discovery, gave rise to the new claim. The Heirs filed an opposition, and Gloria Sholing replied. The trial court did not take action on Gloria Sholing’s motion.
[13] Several other parties filed motions for summary judgment that the trial court acted on before the Heirs’ motion for summary judgment. The trial court granted Attorney Perez’s motion for summary judgment on Rosario Bautista and Manuel Sholing’s third amended complaint, finding that the statutes of limitation had run on the claims and that they would further be barred by laches. Subsequently, the trial court granted an Estate motion for summary judgment on the third amended complaint on the same grounds.
[14] Thereafter, the trial court issued a decision and order granting the Heirs’ motion for summary judgment. The court found Gloria Sholing’s counterclaims were barred, whether by application of the law of the case doctrine or an independent application of the statutes of limitation. It also found that the doctrine of recoupment did not apply to preserve Gloria Sholing’s claims because laches still applied. In disposing of the claims, the trial court also engaged briefly with Gloria Sholing’s fraud claim, even though it had not formally acted on the motion to file amended pleadings in which that claim was proferred.
[15] Having disposed of all issues before it, the trial court entered judgment in favor of the defendants and dismissed the matter with prejudice. Gloria Sholing timely appealed.

[16] This court has jurisdiction over an appeal from a final judgment of the Superior Court. 48 U.S.C.A. § 1424-1(a)(2) (Westlaw through Pub. L. 115-84 (2017)); 7 GCA §§ 3107, 3108(a) (2005).

[17] “We review a trial court’s decision granting a motion for summary judgment de novo.” Hawaiian Rock Prod. Corp. v. Ocean Hous., Inc., 2016 Guam 4 ¶ 13 (citing Zahnen v. Limtiaco, 2008 Guam 5 ¶ 8; Taitano v. Lujan, 2005 Guam 26 ¶ 11). “In rendering a decision on a motion for summary judgment, the court must draw inferences and view the evidence in a light most favorable to the non-moving party.” Bank of Guam v. Flores, 2004 Guam 25 ¶ 7 (quoting Edwards v. Pac. Fin. Corp., 2000 Guam 27

Supreme Court of Guam

Bautista v Torres [2017] GUSC 17 (5 December 2017)