Justia North Dakota Supreme Court Opinion Summaries

Jared Larson appealed a district court judgment foreclosing a mortgage in favor of Heartland State Bank. Larson argued the judgment should have been reversed because Heartland’s notice before foreclosure was legally insufficient. The North Dakota Supreme Court found Larson raised an issue of defective notice during the pendency of the action after Heartland moved to amend its complaint. After reviewing the record, the Supreme Court concluded the defect did not impair Larson’s rights and was not fatal to Heartland’s foreclosure action. Rather than impair Larson’s rights, the Court found the defect benefited him: had he paid the amount due under the notice, the mortgage would have been reinstated under N.D.C.C. 32-19-28 and Heartland would have been required to start the process over to foreclose the mortgage. Because the defect did not impair Larson’s right to reinstate the mortgage, the Supreme Court concluded the district court did not err in granting Heartland’s motion to amend the complaint and motion for summary judgment. Judgment was affirmed. View "Heartland State Bank v. Larson, et al." on Justia Law

Great Plains Royalty Corp. appealed the dismissal of its complaint and deciding ownership of certain real property in favor of Earl Schwartz Co. (“ESCO”); Basin Minerals, LLC; SunBehm Gas, Inc.; and other defendants. In 1968, Great Plains’ creditors initiated a bankruptcy case by filing an involuntary petition under Chapter 11 of the Bankruptcy Code. The bankruptcy court ruled Great Plains was “a bankrupt,” and the case was converted to a liquidation proceeding under Chapter 7 of the Bankruptcy Code. The trustee received permission to sell the estate’s assets, an auction sale was held, and Earl Schwartz was the winning bidder. An order confirming sale of the assets was entered; the order stated Schwartz entered into an agreement with SunBehm to purchase certain properties in the bankruptcy estate, and title was transferred on those properties directly from the estate to SunBehm. The trustee did not collect sufficient funds from the auction to pay all creditors in full. The bankruptcy case was closed in 1974. In 2013, the bankruptcy case was reopened, and a successor trustee was appointed. The successor trustee collected funds sufficient to pay “a 100 percent dividend” to the estate’s creditors, and he attempted to disburse the funds to the unpaid creditors. While the case was open various adversary proceedings were brought, including some to determine ownership of certain properties. Some of the adversary proceedings were decided, and others were dismissed for lack of jurisdiction. The bankruptcy court discharged the trustee and closed the bankruptcy case in May 2016. In December 2016, Great Plains sued ESCO, Basin, and SunBehm to quiet title to oil, gas, and other minerals in and under three properties located in McKenzie County, North Dakota. ESCO and Basin were successors in interest to Schwartz. Great Plains argued the district court erred by finding the bankruptcy trustee intended to sell all of Great Plains’ assets, including those not listed in the auction sale notice, to Earl Schwartz. The North Dakota Supreme Court concluded the district court’s decision to quiet title in favor of the defendants was based on its misapplications of the law and findings that were not supported by the evidence. The Court considered the remaining issues and arguments and concluded they were either without merit or are unnecessary to its decision. Because the court’s findings were clearly erroneous, the Supreme Court reversed the district court’s judgment deciding ownership of certain properties and dismissing Great Plains’ complaint with prejudice. The matter was remanded for further proceedings to determine the parties’ claims and ownership of the properties. View "Great Plains Royalty Corporation v. Earl Schwartz Company, et al." on Justia Law

Debra Heitkamp, the personal representative of the Estate of Nick Lyons, appealed a district court judgment in favor of Kevin Kabella following cross-motions for summary judgment, alleging the district court improperly determined the parties’ agreement was invalid because it fell within the limitation on the length of agricultural leases provided by N.D.C.C. 47-16-02. Kabella and Lyons entered into an agreement pertaining to farmland on March 29, 2007. The agreement gave Lyons possession and use of the property “in perpetuity.” In addition to receiving the property in perpetuity, the agreement stated Kabella could sell the property subject to Lyons’ right to purchase the property. Prior to the 2012 farming season, Kabella attempted to lease the property to Kermit Anderson Jr. Lyons refused to vacate the property asserting he was entitled to the use and possession of the property pursuant to his agreement with Kabella. Anderson brought an eviction action to remove Lyons from the property. Kabella was included as a defendant to allow a resolution of any issues regarding the agreement between Kabella and Lyons. In the litigation initiated by Anderson, Anderson and Kabella asserted the March 29, 2007 agreement between Kabella and Lyons was invalid under N.D.C.C. 47-16-02. Lyons passed away in May 2013, and Heitkamp was appointed personal representative of the estate. The estate used the property since that time. In March 2017, Heitkamp on behalf of Lyons' estate. sued for a declaration the agreement was valid in perpetuity. The district court granted summary judgment to Kabella and found the agreement was a lease that fell within the restrictions of N.D.C.C. 47-16-02, and due to the non-occurrence of any of the contingencies contained in the agreement, it expired on its tenth anniversary, March 29, 2017. The court awarded Kabella damages equal to the fair value of the use of the property subsequent to March 29, 2017. The North Dakota Supreme Court concluded "reasonable persons can draw more than one conclusion regarding the nature of the parties’ agreement," and therefore reversed judgment and remanded for a determination of whether this agreement was a lease subject to the limitations of N.D.C.C. 47-16-02, or a grant, option to purchase, or contract for deed outside the limitations of N.D.C.C. 47-16-02. Because the question of whether the limitation within N.D.C.C. 47-16-02 applied to the parties’ agreement remained undetermined, the Supreme Court declined to decide if the agreement was invalid after extending for a period of ten years. View "Heitkamp v. Kabella" on Justia Law

Daniel and Debra Bearce (“the Bearces”) appealed a judgment entered in favor of Yellowstone Energy Development LLC (“Yellowstone”) after the parties’ cross motions for summary judgment. In June 2006, representatives of a business entity that would eventually become Yellowstone went to the Bearces' home seeking to purchase 170 acres of land they owned. Yellowstone successfully secured an exclusive option to purchase the land. In 2008, Yellowstone exercised its option to purchase the land and the parties entered into a contract for deed. In 2009, Yellowstone and the Bearces modified the contract for deed to alter some of the payment terms. Both the original contract for deed and the 2009 modified contract for deed included a term providing for the payment of a portion of the purchase price with “shares” of a contemplated ethanol plant. Yellowstone subsequently abandoned its plan to build an ethanol plant on the Bearces’ land. In July 2010, Yellowstone sent a letter to the Bearces advising them their $100,000 in “value” would be issued despite Yellowstone’s abandonment of the plan to build an ethanol plant. The letter stated ownership units had not yet been issued and explained the Bearces would receive their ownership interest “at the time shares are issued to all its members.” Shortly after receiving that letter, the Bearces executed and delivered a deed for the property to Yellowstone. In December 2011, and again in October 2012, the Yellowstone Board of Directors approved a multiplier of three units per $1 invested for individuals who had provided initial cash investment in Yellowstone. The Bearces’ interest in Yellowstone was not given the either 3:1 multiplier. The Bearces' objected, and Yellowstone continued to refuse to apply the multiplier to the Bearces' interest. When unsuccessful at the trial court, the Bearces appealed, challenging the district court’s exclusion of parol evidence to support their allegation of fraud in the inducement. The Bearces also challenged the district court’s conclusion the Bearces were not owed a fiduciary duty. After review, the North Dakota Supreme Court affirmed the district court’s judgment dismissing the Bearces’ claim for fraud and their claim for breach of contract. The Court reversed the district court’s dismissal of the Bearces’ claim for breach of a fiduciary duty and remanded for further proceedings. View "Bearce, et al. v. Yellowstone Energy Development, LLC" on Justia Law

Larry and Julie Schindler and the estate of Eugene Weisbeck appealed a judgment dismissing their action to reform warranty deeds and quiet title in themselves to certain Morton County, North Dakota property. Because the North Dakota Supreme Court could not determine whether the district court correctly applied the law, it reversed and remanded for further development of the record. View "Schindler v. Wageman" on Justia Law

Allen Lenertz appealed the dismissal of his claim for inverse condemnation against the City of Minot and awarding the City costs and disbursements. Between 2013 and 2014 the City installed a paved street and upgraded the storm water system adjacent to Lenertz's commercial property in southwest Minot. Lenertz's property subsequently suffered three flooding events. In 2016 Lenertz sued the City for inverse condemnation, alleging the City's actions in constructing the street and storm sewer system caused past and future flooding of his property and resulted in a total taking of his property. The City denied a taking occurred and raised affirmative defenses. The North Dakota Supreme Court concluded the district court: (1) did not err in ruling Lenertz established only a partial taking of his property; (2) did not abuse its discretion in denying his proposed expert witness's testimony; and (3) did not err in granting the City judgment under N.D.R.Civ.P. 50. The court did abuse its discretion, however, in awarding the City costs and disbursements. View "Lenertz v. City of Minot N.D." on Justia Law

Julian Bearrunner appealed after being convicted of class A misdemeanor criminal trespass and class A misdemeanor engaging in a riot, charges stemming from protests near the Dakota Access Pipeline. On appeal, Bearrunner argued the district court misinterpreted the criminal trespass statute by finding that the pasture was "so enclosed as manifestly to exclude intruders" as required to convict him of the trespassing charge. Bearrunner also argued the district court erred in finding that his conduct was "tumultuous and violent" as required to convict him of the engaging in a riot charge. Upon reviewing the record, the North Dakota Supreme Court concluded Bearrunner's conviction of class A criminal trespass under N.D.C.C. 12.1-22-03(2)(b) was supported by substantial evidence. However, there was not substantial evidence that Bearrunner engaged in violent conduct sufficient to support a conviction for the class A misdemeanor of engaging in a riot. Whether a fence is so enclosed as manifestly to exclude intruders is a finding of fact. Appellant's conduct did not rise to the level of "tumultuous and violent" as required under N.D.C.C. 12.1-25-01. View "North Dakota v. Bearrunner" on Justia Law

Western Energy Corporation appealed a district court judgment finding its quiet title action to be barred by applicable statutes of limitation and laches and awarding the mineral interests at issue to the Stauffers. In 1959, L.M. and C.S. Eckmann agreed to convey property to William and Ethel Stauffer through a contract for deed. The contract for deed included a reservation of the oil, gas, and other mineral rights in the property and described a five-year payment plan. After the payment plan concluded in 1964, the Eckmanns were to convey the property to the Stauffers by warranty deed. The warranty deed did not contain a mineral reservation, but stated that it was given "in fulfillment of a contract for deed issued on the 25th of May, 1959." Numerous conveyances, oil and gas leases, and similar transactions were completed by both the Eckmanns and Stauffers, as well as their successors in interest, between the execution of the warranty deed in 1959 and the filing of this quiet title action in 2016. Western Energy Corporation ("Western") obtained its interests in the subject minerals through mineral deeds executed in 1989 and 1990. The original parties to the warranty deed are all now deceased. Western filed this action to quiet title in 2016. Western and the Stauffers submitted stipulated facts to the district court. Although brought as a quiet title action, the relief requested was actually reformation of the warranty deed. The district court found reformation barred by the statutes of limitation as well as by the doctrine of laches. Further, the district court concluded the discrepancy between the contract for deed and the warranty deed was not enough to establish mutual mistake. Because it found that Western had not met its burden of proof to establish mutual mistake at the time of conveyance, the district court entered judgment quieting title of the minerals to the Stauffers. Finding no reversible error in the district court's judgment, the North Dakota Supreme Court affirmed. View "Western Energy Corporation v. Stauffer" on Justia Law

George Seccombe and other heirs of Olaf Nasset ("Nasset heirs") and the intervener plaintiffs, Slawson Exploration Company, Inc., and Alameda Energy, Inc., appealed a judgment deciding ownership of certain minerals in Mountrail County, North Dakota. Olaf Nasset died in November 1961, and Lakeside State Bank, as executor of his estate, petitioned the county court for authority to sell real property belonging to the estate. On August 6, 1962, the county court ordered the final discharge of the executor. A few days later, the executor petitioned to re-open the estate because reserved mineral interests were inadvertently left out of the final decree and it was necessary that the estate be reopened for the sole purpose of correcting the error by entering an amended final decree of distribution including the 1/2 mineral interest. The county court granted the petition. On August 10, 1962, an amended final decree of distribution was entered, stating each of the five named heirs received a 1/10 mineral interest. In 2012, the Nasset heirs sued the heirs of Gilbert Rohde and other parties claiming an interest in the minerals through the Rohde heirs. The Nasset heirs sought to quiet title and determine ownership of the minerals, revision of the executor's deed, and damages for a slander of title claim. They alleged the original heirs of Olaf Nasset intended to reserve a one-half mineral interest and they are entitled to receive legal title to one-half of the minerals as provided in the published notice of sale of the real property and the amended executor's deed. The Nasset heirs also sued Lakeside for breach of fiduciary duty, alleging Lakeside had fiduciary obligations to the estate, it was aware or should have been aware of the heirs' intention to retain a one-half mineral interest, and it breached its fiduciary duty by executing the executor's deed to Gilbert Rohde without properly reserving the mineral interests.The district court granted summary judgment in favor of the Rohde heirs and against the Nasset heirs, quieted title in favor of the Rohde heirs, and dismissed the Nasset heirs' claim for slander of title. The district court concluded the Rohde heirs own the minerals because the original executor's deed approved by the court was final, a legal action was required to undo the executor's deed, neither the heirs nor the executor commenced an action to correct or vacate the deed, and therefore the subsequent orders and the amended deed had no effect. The court also concluded the Nasset heirs' claims were barred by the statute of limitations. Finding no reversible error, the North Dakota Supreme Court affirmed the district court's judgment. View "Seccombe v. Rohde" on Justia Law

John Benson appealed a district court judgment quieting title action to Desert Partners IV, L.P. and Family Tree Corporation, Inc. for 32 net mineral acres in McKenzie County, North Dakota. Benson argued the district court abused its discretion in denying his request for a continuance of the trial and erred in its conclusion that Desert Partners and Family Tree were good-faith purchasers of the minerals. After careful consideration of the trial court record, the North Dakota Supreme Court concluded the district court did not err in its judgment, and affirmed. View "Desert Partners IV, L.P. v. Benson" on Justia Law