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Homes v. Andrade

July 3, 2008

ST. JAMES MUTUAL HOMES, APPELLANT
v.
TRACY N. ANDRADE, APPELLEE



Appeal from the Superior Court of the District of Columbia (SC-1175-01) (Hon. Peter H. Wolf, Trial Judge).

The opinion of the court was delivered by: Terry, Senior Judge

Submitted November 19, 2002

Before FERREN, STEADMAN, and TERRY, Senior Judges.*fn1

This appeal arises from a dispute between St. James Mutual Homes ("St. James"), a cooperative housing corporation, and Tracy Andrade, one of its former members. After a non-jury trial, the court awarded Mr. Andrade the return of what the parties have referred to as "membership monies," which are the initial payments made to St. James when someone becomes a member of the cooperative, plus interest and court costs.*fn2 The trial court also denied St. James' counterclaim for unpaid "carrying costs" - i.e., the monthly payments a member makes to the cooperative. St. James argues on appeal (1) that the court erred in ruling that Mr. Andrade's claim for the return of his membership monies was not barred by the statute of limitations; and (2) that the court's denial of its counterclaim for unpaid carrying costs was based on an erroneous interpretation of the Occupancy Agreement. We affirm the judgment on Mr. Andrade's claim and hold that it was not barred by the statute of limitations, but on a ground different from that relied upon by the trial court. With respect to St. James' counterclaim, we reverse the judgment and remand the case for further proceedings.

I.

St. James is a corporation that owns and maintains a cooperative apartment building in the District of Columbia. In 1994 Mr. Andrade purchased a membership in St. James which entitled him to occupy a dwelling unit in that building for a three-year term, from June 1, 1994, through May 31, 1997. Admitted into evidence at trial was the Occupancy Agreement, which set forth the terms and conditions of Mr. Andrade's membership. Article 4 of the agreement states that when the three-year term expires, the membership will be automatically renewed for another three years unless "notice of the Member's election not to renew shall have been given to the Corporation in writing at least four months prior to the expiration of the then current term."

On July 22, 1997, almost two months after the initial three-year term ended, Mr. Andrade submitted a letter to Ms. Brown-Lee, the president of the Board of Directors, informing her that he would be moving out of his dwelling unit on August 31. He said the same thing in another letter, also dated July 22, 1997, to Mr. Lytle, the property manager of the building. Both letters were introduced into evidence. Mr. Andrade did in fact move out of his unit on August 31, 1997. According to his testimony, his decision to move was "willingly accepted" by both of these individuals.*fn3

St. James was not able to resell Mr. Andrade's dwelling unit until October of 1999, more than two years after he moved out. At no time between Mr. Andrade's departure and the resale of the unit did he pay any carrying costs, nor did St. James notify him of its intent to hold him accountable for any unpaid carrying costs. St. James did not return Mr. Andrade's membership monies, either when he moved out or when the unit was resold in October 1999, despite his repeated requests for St. James to do so.

On January 18, 2001, Mr. Andrade filed this action for the return of his membership monies. On March 15, 2001, the day of the trial, St. James filed a counterclaim for $7,525, seeking Mr. Andrade's unpaid carrying costs for the period from September 1, 1997, through October 31, 1999.*fn4

II.

An action for breach of contract must be brought within three years from the date of the breach. D.C. Code § 12-301 (7) (2001); see Western Union Telegraph Co. v. Massman Construction Co., 402 A.2d 1275, 1277-1278 (D.C. 1979). The trial court concluded that a breach occurred, and that Mr. Andrade's cause of action accrued, when St. James failed to return his membership monies when he moved out of the building. That event occurred in August 1997, more than three years before he filed this suit in January 2001. The court nevertheless held that Mr. Andrade's claim was not barred by the statute of limitations because "the corporation led him to believe that the sums would be returned upon the sale of the unit governed by his Occupancy Agreement," thus ruling in effect that Mr. Andrade was lulled into not filing a timely suit, and that St. James was therefore estopped from raising a statute of limitations defense. We hold that the trial court erred in ruling that Mr. Andrade's cause of action accrued in August 1997, but we also find that error harmless because we conclude that the cause of action did not accrue until October 1999. We therefore must sustain the trial court's decision that the suit is not barred by the statute of limitations. See, e.g., Cevenini v. Archbishop of Washington, 707 A.2d 768, 775 (D.C. 1998) ("if the decision of a trial court is correct, 'it must be affirmed,' even though the trial court 'relied upon a wrong ground or gave a wrong reason' " (citation omitted)).

"What constitutes the accrual of a cause of action is a question of law . . . ." Id. at 770-771 (citations omitted); accord, e.g., Executive Sandwich Shoppe, Inc. v. Carr Realty Corp., 749 A.2d 724, 735 (D.C. 2000) (citations omitted). Here we are dealing with a breach of contract claim, and therefore we must decide what triggered St. James' obligation to return Mr. Andrade's membership monies. The trial court ruled that St. James incurred this obligation when Mr. Andrade moved out. We hold, however, that his cause of action did not accrue until St. James failed to return the membership monies upon the resale of the dwelling unit in October 1999.

Admittedly, the Occupancy Agreement says nothing about the return of membership monies, and the by-laws - which give St. James in Section 8 (b) a thirty-day "option," but "not [an] obligation," to buy back the membership from any member who decides to leave, subject to deductions for any necessary repairs and deferred maintenance*fn5 - are silent as to when such monies must be returned.*fn6 Our holding is therefore based not on the agreement itself, but on documentary evidence outside of the agreement, namely, the Settlement Statement received by Mr. Andrade upon purchasing his unit. This document, which was admitted into ...


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