Appeal from the Superior Court of the District of Columbia; (Hon. Joseph M. Hannon, Trial Judge)
Before Steadman and Wagner, Associate Judges, and Kern, Senior Judge.
The opinion of the court was delivered by: Wagner
WAGNER, Associate Judge: Appellants, Louis A. Kleiman and his attorney, Ted Kavrukov, appeal from an order of the trial court requiring them to pay attorney's fees in the amount $17,928.00 to appellee, Carolyn R. Kleiman, and for appellant Kleiman to pay her $3,149.35 as costs as sanctions under Super. Ct. Civ. R. 11. The trial court ruled that appellants violated Rule 11 by filing an amended complaint seeking to enforce the terms of a property settlement agreement entered by the Kleimans which was incorporated, but not merged, in their final judgment of absolute divorce. The trial court's finding of a Rule 11 violation was based "mainly upon the overwhelming evidence that there never was a written separation agreement" between the parties as alleged in the amended complaint. The court made this finding after a hearing on the merits of appellant Kleiman's claim for division of former marital property pursuant to an agreement entered by the parties. We reverse and order the trial court to vacate the order granting Rule 11 sanctions.
The record discloses the following facts pertinent to our Disposition of the issues raised on appeal. Appellant Kleiman and appellee were granted a judgment of absolute divorce in the Superior Court of the District of Columbia on December 5, 1983. In that divorce action, appellant Kleiman alleged in the complaint, inter alia, that:
There are no property rights to be adjudicated. The parties have disposed of all such rights and obligations as exist between and among themselves pursuant to an agreement signed by both parties. The parties are financially able to abide by the terms and conditions contained in said agreement, and each has had the opportunity to have the advice of counsel with regard to same.
Appellee filed a verified answer admitting the allegations contained in the above-quoted paragraph. The judgment entered in the divorce action recites the court's finding, based upon the evidence adduced, and that the parties had disposed of their property rights pursuant to an agreement signed by both. The judgment further states that "said agreement is incorporated by reference, but is not merged." Both parties signed a praecipe in the divorce action informing the court that the case was uncontested as to all issues. Thereafter, both parties filed a notice of appeal on December 6, 1983, and both signed a praecipe dated that same date indicating that each waived any and all rights to appeal and sought to have the judgment become final immediately.
On April 29, 1986, appellant Kleiman, through counsel at the time, appellant Kavrukov, initiated this action by filing a complaint for partition and sale of real property pursuant to D.C. Code § 16-2901 (1989). He alleged that the parties were formerly husband and wife who owned the real property known as One & Two Logan Circle, N.W., Washington, D.C.; that the parties were tenants in common; that the property could not be divided without loss or injury to the parties; that he had maintained and preserved the property; and that he had made substantial improvements which entitled him to a certain amount of the proceeds. Appellee answered that the property was subject to division in kind in that each of the parties occupied one of two separate properties, although they were of unequal value. It was appellee who pleaded the provisions of the prior divorce judgment in her original answer, specifically contending:
in answer [to paragraph 4 of the complaint], the defendant alleges that a final judgment of divorce was entered in this court in the Family Division in Civil Action No. D-03251-83 on the 5th day of December, 1983, and at that time the court found as follows:
There are no property rights to be adjudicated. The parties have disposed of all such rights and obligations as exist between and among themselves pursuant to an agreement signed by both parties. Said agreement is incorporated by reference but is not merged.
Appellee further asserted that any property rights to be adjudicated in the partition action should be based on an equitable distribution "under the terms of the domestic relations case."
Only after appellee pleaded the prior judgment did appellant Kleiman file under the signature of appellant Kavrukov, as counsel, an amended complaint also setting forth the provision of the divorce judgment as relied upon by appellee in her original answer. Appellant Kleiman also alleged in the amended complaint that appellee refused to convey to him the real property known as Two Logan Circle pursuant to the referenced agreement and that he was ready and willing to convey to appellee, in kind, the property known as One Logan Circle. Appellants attached to the complaint what purports to be an unexecuted copy of the settlement agreement referred to in the divorce action. *fn1
In answer to the amended complaint, appellee admitted the existence of only an oral agreement between the parties at the time of the divorce. She also pleaded in bar the statute of frauds, the statute of limitations and/or laches, waiver, and estoppel. Appellee alleged that appellant Kleiman had failed and refused to perform his obligations under either the unsigned written agreement between the parties or their oral agreement. She also asserted that the unsigned written agreement did not reflect accurately the parties' oral agreement in that "several material terms of that agreement did not appear in the written unsigned agreement." Appellee prayed alternatively that the court rescind or cancel the contract, if it determined that one existed, or that it partition the parties' real property and award her 75% of the proceeds. *fn2 The trial court entered findings of fact and Conclusions of law on the record and ordered a partition by judicial sale of the property, granting 45% to Louis Kleiman and 55% to Carolyn Kleiman. *fn3
Appellee filed a motion for the imposition of Rule 11 sanctions based primarily upon the filing of the original complaint in this case. She contended that the original complaint represented an abusive litigation tactic. According to appellee, appellants' improper purpose for filing the original complaint is shown by appellants' trial testimony, as well as by the amended complaint, which she contends contradicts the original factual ...