Chard v. Chard: A Family Feud Over Business and Property Disputes

The case Chard v. Chard stemmed from a dispute between Stephanie Chard and her father, Kent Chard, over the Training Table restaurant chain in Utah. Founded by Kent in 1977, the business became the center of litigation after Stephanie purchased a 50% stake in 2012 using inheritance funds. While Stephanie and Kent each held equal ownership in the business, they disagreed over lease terms for the restaurant properties, which were controlled by Kent's entities, TT Three LC and Training Table Land and Holding LC.

The conflict escalated in 2015 when Stephanie proposed a business succession plan to acquire her father’s remaining interests. Kent rejected the proposal, prompting Stephanie to direct the company to withhold rent payments to Kent’s entities. Kent attempted to sell the properties to a third party, leading Stephanie to file a lawsuit that included claims of breach of fiduciary duty, fraud, and unjust enrichment.

Trial Court Proceedings

The trial court consolidated the landlord eviction claims with Stephanie’s broader lawsuit. However, Stephanie’s legal strategy faced challenges due to insufficient damage disclosures and the preclusive effect of earlier rulings in the eviction case. The trial court dismissed most of Stephanie’s claims and Kent’s counterclaims, leading both parties to appeal.

Appellate Court Ruling

The Utah Court of Appeals addressed multiple issues, affirming some dismissals and reversing others.

1. Unjust Enrichment Claim: The appellate court reversed the dismissal of Stephanie’s claim for unpaid services provided to Kent’s entities, noting that her invoices sufficiently supported the damages sought. The court found that excluding evidence based on incomplete disclosures was an abuse of discretion.

2. Breach of Fiduciary Duty Claims: Stephanie and Kent agreed in open court to dismiss their fiduciary duty claims against each other. Despite Stephanie's later objections, the court upheld the dismissal, finding no grounds to reinstate her claims.

3. Damages Disclosures: The appellate court found Kent’s supplemental damage disclosures adequate, reversing the trial court’s exclusion of his damages evidence. This decision reinstated some of Kent’s counterclaims.

4. Wrongful Lien Counterclaim: The court reinstated Kent’s claim, ruling that Stephanie’s filing of a lis pendens did not pertain to the title or possession of real property, violating Utah law.

5. Legal Malpractice and Fraud: The court affirmed the dismissal of these claims, emphasizing the lack of timely and specific arguments on appeal.

Implications

The appellate court’s rulings highlight the complexities of family business disputes and the importance of meeting procedural requirements in litigation. This case underscores the need for thorough and timely damage disclosures and adherence to the legal boundaries of lis pendens filings.

Resolve Business Disputes with Experienced Legal Guidance

Family business disputes, like those in Chard v. Chard, can be complex and emotionally charged. At Whitcomb Selinsky PC, our commercial litigation attorneys are dedicated to resolving conflicts effectively, whether through negotiation or litigation. We specialize in safeguarding your business interests and navigating intricate legal challenges. Visit our commercial litigation page to learn how we can assist with your business dispute.