## Facts

- Herman Cooper, his son Brian Cooper, and Brian’s wife Karen purchased Vermont real property in 1983 as co-owners, with Herman holding a 50% joint-tenancy interest and Brian and Karen holding the other 50% as tenants by the entirety.
- Herman initially paid the mortgage and expenses; later Brian assumed payments.
- During Brian and Karen’s divorce proceedings, Brian stopped paying, and the lender began foreclosure.
- Herman and his wife, Beatrice Cooper, arranged for Beatrice to acquire an assignment of the mortgage in her own name.
- After the assignment, Herman severed the joint tenancy, converting his interest to a tenancy in common and eliminating Karen’s survivorship rights in his share.
- Karen repeatedly sought information from Beatrice about the mortgage and status of any lender claims; Beatrice did not respond.
- For about two years, Beatrice made no demand for payments, then demanded nearly $100,000 within thirty days and filed a foreclosure action when payment was not made.
- Evidence supported that Herman orchestrated the mortgage purchase and foreclosure to retaliate against Karen in connection with the marital breakup.

## Issues

1. Whether co-tenants owe fiduciary duties regarding commonly owned property, and whether Herman’s mortgage/foreclosure conduct breached that duty.
2. Whether Beatrice acted as Herman’s agent in acquiring and enforcing the mortgage and was liable for participating in the breach of fiduciary duty.
3. Whether summary judgment and partial summary judgment were properly granted on foreclosure and fiduciary-duty liability, leaving damages for trial.
4. Whether the evidence supported emotional-distress damages and punitive damages arising from the conduct.
5. Whether the trial court properly handled Herman’s claim for contribution from the other co-owners for mortgage payments.

## Decision

- Affirmed summary judgment against Beatrice’s foreclosure claim because the mortgage was acquired and held for the benefit of the co-owners, precluding foreclosure as an adverse holder.
- Affirmed partial summary judgment that Herman breached his fiduciary duty as a co-tenant by using the mortgage assignment and foreclosure process to disadvantage Karen.
- Affirmed that Beatrice acted as Herman’s agent and was liable for aiding and participating in the fiduciary breach.
- Affirmed the jury award of emotional-distress damages against Herman and Beatrice and punitive damages against Herman.
- Reversed and remanded on contribution because the trial court improperly deferred that issue to an out-of-state divorce proceeding rather than adjudicating it.

## Legal Principles

- Co-tenants are in a fiduciary relationship as to the common property, with duties to protect common title and not directly or indirectly attack another co-tenant’s interest.
- A co-tenant may not obtain an apparent advantage over other co-tenants by acquiring an encumbrance and enforcing it in a manner inconsistent with co-tenancy obligations; such conduct can constitute a breach of fiduciary duty.
- Agency principles can impose liability on a person who, acting for a co-tenant, participates in conduct that breaches the co-tenant’s fiduciary obligations.
- Appellate review generally will not consider arguments against summary judgment that were not raised in opposition in the trial court.
- Emotional-distress damages may be awarded when supported by evidence of causation and harm linked to wrongful conduct; punitive damages require proof of bad motive or reckless indifference beyond mere negligence.
- A co-tenant who pays more than a proportional share of obligations affecting the common property may seek contribution, and the forum court should decide the claim rather than defer it to unrelated proceedings.

## Conclusion

The court held that co-tenancy creates fiduciary duties that bar a co-tenant from using a mortgage purchase and foreclosure strategy to harm another co-tenant, upheld compensatory and punitive damages based on retaliatory conduct, and remanded for adjudication of contribution.


Cooper v. Cooper, 173 Vt. 1, 783 A.2d 430 (Vt. 2001)