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A trial is underway in a real estate dispute between pop superstar Katy Perry and the 84-year-old millionaire who says he was bamboozled into selling her his estate when he was mentally incapacitated.
A star-studded lawsuit
84-year-old Texas entrepreneur Carl Westcott, the father-in-law of “Real Housewives of Dallas” star Kameron Westcott and the millionaire founder of 1-800-Flowers, sued Perry, whose legal name is Katheryn Hudson, and Perry’s business manager, Bernie Gudvi.
Perry’s fiancé, actor Orlando Bloom, is also referenced in the complaint. According to testimony in court Thursday, the couple planned to raise their daughter, Daisy Dove, in the home.
A sprawling estate, a lengthy surgery and a quick return on investment
On May 29, 2020, Westcott purchased an eight-bedroom, 11-bathroom estate on nine acres in the Santa Ynez foothills in Montecito, California for $11.25 million. The oceanside area is known as a favorite locale for celebrity residents including Oprah Winfrey, Brad Pitt and Ellen DeGeneres.
Perry’s offer to purchase the home came less than two months after Westcott acquired the estate and was more than $3.75 above Westcott’s purchase price.
In the complaint, Westcott described his “frailty from advanced age and poor heath from Huntington’s Disease,” and related diminished cognitive function. He had a six-hour spinal surgery on July 10, 2020, just four days before Perry’s agent presented him with a contract to sell his home. Westcott said when he signed the contract, “he was suffering severe pain and/or post-surgical delirium,” was, “suffering from dementia and/or diminished mental cognitive functions caused by his Huntington’s Disease,” and was also, “under the influence of several intoxicating pain-killing opiates.”
The octogenarian said the drugs “had the effect of disorienting and intoxicating” him and, “deprived [him] of reason and understanding with respect to the terms and consequences of the contract.”
Westcott said that when Gudvi presented him with a written purchase offer on July 14, 2020, Westcott had been “unable to understand the nature and probable consequences of the proposed contract” and “lacked the requisite level of alertness and attention” to fully reason through the contracting process.
Per the complaint, Westcott also signed a separate contract the next day, with brokerage firm Berkshire Hathaway Home Services, California Properties — this time agreeing that Gudvi would act as a dual agent for the buyer and seller.
Westcott looks to cancel the contract
Westcott said he began to regain his faculties on July 22, 2020, and when he realized he did not want to sell his home, he contacted Berkshire Hathaway via email. The same day, according to Westcott, he received a letter from Perry.
“The letter stated how much she and her boyfriend, the actor Orlando Bloom, liked the house and that they were expecting a baby and wanted to raise their child in the home,” said the complaint.
Westcott said he was not swayed and declined Perry’s offer the next day, noting, “It does not matter to Mr. Westcott that Ms. Perry is willing to pay him $3,750,000 more than Mr. Westcott paid to purchase his home just a few months earlier.”
However, according to the complaint, Westcott received a letter from a lawyer representing both Gudvi and Perry on July 24, 2020. “The letter advised Mr. Westcott that Ms. Hudson was not willing to walk away from purchasing Mr. Westcott’s home and he is obligated to complete the sale,” said the complaint.
Void and voidable contracts for the sale of real estate
Generally, any contract signed by a person who lacks sufficient mental capacity to understand what they are doing will be deemed “voidable.” The distinction between a “void” contract, or one that cannot be enforced by either party due to a legal defect such as incapacity, duress, or fraud, and one that is “voidable” is that a voidable contract can later be ratified by the innocent party if they wish to adhere to the contract’s terms once the legal defect is remedied.
Should Westcott prevail in convincing the court that he lacked sufficient capacity to contract with Gudvi for the sale of the home, the court will nullify the contract. A nullification would mean dissolving the contract as if it never existed, and perhaps assessing costs or damages to one of the parties to resolve any persisting unfairness.
The trial began on Sept. 28 and is proceeding without a jury. Perry is expected to testify.
In addition to the property, Perry is asking for lawyers’ fees, $2.7 million to cover the cost of a similar rental in the area, and $3.21 million in damages for lost rent. Although Perry does not claim that she intended to lease the home, the damages are meant to estimate a dollar value for her damages.
Absent any contractual defect, agreements for the sale of real estate can give rise to a rarely-used legal remedy known as “specific performance,” which permits an aggrieved party to insist that a contract’s terms be carried out precisely as agreed upon. Should Perry succeed in convincing a court that the sale contract is enforceable and that money damages are insufficient to compensate her for the loss, she may be entitled to this remedy.
Perry’s history with real-estate disputes and octogenarians
In 2015, Perry was involved in a legal battle with the sisters of the Most Holy and Immaculate Heart of the Blessed Virgin Mary and the Archdiocese of Los Angeles in a property dispute over ownership of a gothic Tudor estate. A group of nuns sold the estate to restauranteur Dana Hollister, but the archdiocese later argued the nuns did not have the right to sell the property and instead approved a sale to Perry.
Perry won the lawsuit over the $15.5 million sale.
The dispute made headlines when one nun involved in the dispute, Sister Catherine Rose Holzman, collapsed and died in court at the age of 89. Holzman had said in an interview that, “Katy Perry represents everything we don’t believe in,” and commented that “It would be a sin to sell to her.”
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