Justia North Dakota Supreme Court Opinion Summaries

The underlying dispute before the North Dakota Supreme Court in this case concerned two competing oil and gas leases. In 2006, Ritter, Laber and Associates, Inc. was part of a joint venture that was locating mineral owners and leasing their interests. Eugene and Carol Hanson entered into a lease agreement with Ritter ("EOG lease") and a "Side Letter Agreement" was executed at the same time, allowing Ritter to “exercise its option” to lease the minerals. If Ritter chose not to exercise the option, Ritter was required to “immediately release [the Hansons] from any further obligation.” The EOG Lease was not immediately recorded. In April 2007, Eugene and Carol Hanson executed a warranty deed to their son and daughter-in-law, Kelly and Denise Hanson, which included the minerals in question and was recorded. The deed reserved a 50% life estate in the minerals. In May 2007, Ritter recorded a “Memorandum of Oil and Gas Lease Option” that referenced the EOG Lease. In July 2007, Ritter recorded the EOG Lease and sent Eugene and Carol Hanson a letter stating it “has elected to exercise its option to lease.” In August 2007, Ritter’s partner sent the couple a check for roughly $37,000 “as total consideration for your Paid up Oil and Gas Lease dated December 20, 2006.” In September 2007, Ritter assigned the EOG Lease, along with a batch of other leases, to EOG. The assignment was recorded. In December 2007, Ritter obtained an oil and gas lease from Kelly and Denise Hanson listing the tracts in question ("Northern Lease"). It was recorded in January 2008 and assigned to Northern in June 2008. Northern filed suit seeking a declaration of what it owned. The court determined the transaction between Eugene and Carol Hanson and Ritter created an option to lease, Denise and Kelly Hanson had no notice of the option, and they took title to the minerals free of it. The court entered a partial judgment determining “the EOG Lease is not valid and subsisting insofar as it conflicts with the Northern Lease.” EOG Resources, Inc. appealed and Northern cross appealed, arguing the court erred when it declined to grant additional relief after its title determination. The Supreme Court held the district court erred when it quieted title in Northern. Judgment was reversed and the matter remanded for further proceedings. View "Northern Oil & Gas v. EOG Resources, et al." on Justia Law

On June 23, 2021, Kathy Schmidt filed a quiet title action covering property located in Benson County, North Dakota, offering a document titled “warranty deed” as evidence of title. The district court granted the defendants’ N.D.R.Civ.P. 12(b) motion to dismiss the complaint with prejudice based on lack of standing and res judicata. Schmidt filed two motions for reconsideration arguing the court failed to consider new evidence. She appealed when the trial court denied her motions. The North Dakota Supreme Court found the district court did not err in dismissing Schmidt’s complaint based on standing. Because the warranty deed did not convey Schmidt a valid interest in the property, she failed to meet the requirements in N.D.C.C. § 47-10-05. Therefore, she did not have standing to bring a quiet title claim. Additionally, since the invalidity of the warranty deed was litigated and a final judgment was rendered, the district court did not err in dismissing Schmidt’s complaint based on res judicata. View "Schmidt v. Hageness, et al." on Justia Law

Whitetail Wave LLC (“Whitetail”) appealed two district court judgments granting summary judgment and dismissing claims asserted by Whitetail against XTO Energy, Inc. (“XTO”) and the Board of University of School Lands of the State of North Dakota, the State of North Dakota, and the Department of Water Resources and Director (collectively “State”). Whitetail argued the court erred by: (1) dismissing its claim asserting the State had committed an unconstitutional taking of its property interest; (2) by dismissing Whitetail’s trespass, slander of title, unjust enrichment and constructive trust claims asserted against the State; (3) by determining XTO had not breached its lease agreement by failing to pay royalties owed to Whitetail; (4) by determining XTO did not violate N.D.C.C. § 47-16-39.1; and (5) by dismissing Whitetail’s constructive fraud claim asserted against XTO. Because the North Dakota Supreme Court concluded there were quiet title claims asserted by Whitetail remaining unresolved, it dismissed the appeal. View "Whitetail Wave v. XTO Energy, et al." on Justia Law

Blayne Puklich and Elyse Puklich were the children of Stan Puklich, who owned and operated an automobile dealership before his death. The dispute arose from the parties’ ownership of various business interests they either purchased or received from their father. Puklich Chevrolet, Inc. (PCI) owned the automobile dealership. B&E Holdings owned the real estate where the dealership was located. Blayne and Elyse each owned interests in these entities, and Elyse had assumed management responsibilities for both. Blayne appealed, individually and derivatively on behalf of B&E Holdings, LLP, a judgment dismissing his breach of fiduciary duty claim against Elyse and END L.L.L.P. Elyse cross appealed, arguing the district court erred when it denied her motion for N.D.R.Civ.P. 11 sanctions. The court held Blayne’s claim, which alleged Elyse breached fiduciary duties by usurping a real estate opportunity, was res judicata but not frivolous. Finding no reversible error as to either claim, the North Dakota Supreme Court affirmed the trial court. View "Puklich v. Puklich, et al." on Justia Law

Northwest Landowners Association filed suit to challenge the constitutionality of North Dakota Senate Bill 2344, which related to subsurface pore space. The district court granted the Association’s cross-motion for summary judgment, concluding S.B. 2344 was unconstitutional under the state and federal takings clauses. The State and Continental Resources appealed the district court’s summary judgment order and amended judgment. On appeal, the State argued S.B. 2344 did not violate the takings clauses and did not constitute an unconstitutional gift, and that the district court misapplied N.D.R. Civ.P. 56 by failing to consider evidence submitted by the State. Continental Resources argued the court erred in analyzing the Association’s facial challenge, in determining pore space had value as a matter of law, and in denying Rule 56(f) discovery. The North Dakota Supreme Court concluded the district court erred in invalidating the entirety of S.B. 2344. The trial court’s judgment was affirmed to the extent that it declared certain portions unconstitutional, but reversed to the extent it declared the remainder of the bill inseparable and invalid. View "Northwest Landowners Association v. State, et al." on Justia Law

Elton Lovro appealed a judgment dismissing his complaint with prejudice after the district court granted summary judgment in favor of the City of Finley (“City”). Lovro owned a house and property in Finley, Steele County, North Dakota. In March 2020, the City’s water line connected to the curb stop leading to Lovro’s home broke. Water flowed onto the property, damaging Lovro’s driveway and basement. Lovro sued the City for negligence and gross negligence, alleging the damages were caused by the City’s failure to properly operate, maintain, repair, and inspect their water system. Lovro also sued the City for breach of contract based on the City’s failure to properly and safely deliver water to his home. The City responded by denying the allegations that it was negligent, grossly negligent or that its acts or omissions caused the damages. The City denied the existence of any contractual relationship between Lovro and the City. The City affirmatively alleged that it was immune from suit under chapter 32-12.1 of the North Dakota Century Code. Lovro argues the district court erred in granting summary judgment dismissing his claims because the ruling was premature and discovery was still ongoing. Finding no reversible error, the North Dakota Supreme Court affirmed the district court. View "Lovro v. City of Finley" on Justia Law

Blue Appaloosa, Inc., appealed a judgment affirming an Industrial Commission order determining it violated N.D. Admin. Code ch. 43-02-03 by beginning construction of a treating plant prior to obtaining a permit or filing a bond with the Commission. Finding no reversible error, the North Dakota Supreme Court affirmed. View "Blue Appaloosa v. NDIC" on Justia Law

Koch Construction, Inc.; Marilyn Koch, Personal Representative of the Estate of Michael P. Koch; and Koch Property Investments, Inc. (collectively “appellants”) appealed the judgment and amended judgment entered in favor of Toman Engineering Company (“Toman”). Michael Koch owned and operated Koch Construction and Koch Property Investments (“KPI”). Toman provided engineering services to Koch Construction on various projects, including designing a stormwater management system for the Koch Meadow Hills residential development project in Dickinson, North Dakota. Michael died in August 2017. The stormwater management system included a detention pond referred to as the Marilyn Way Stormwater Pond, which was the detention pond at issue in this case. In 2016, Janet Prchal, Dean Kubas, and Geraldine Kubas, owners of property near the Koch Meadow Hills development, sued the City of Dickinson and KPI for damages, alleging the development of Koch Meadow Hills caused water to drain and collect on their properties. The Prchal lawsuit was settled in September 2018, and the settlement required modifications to be made to the Marilyn Way Stormwater Pond before June 30, 2019. The reconstruction work on the detention pond occurred during the summer and fall of 2019. Toman served a summons and complaint on Koch Construction and Marilyn Koch, to collect unpaid amounts for engineering services Toman provided to the defendants in 2017. Toman filed the complaint in the district court in June 2019. The appellants argued the district court erred in deciding they committed intentional spoliation of evidence and dismissing their counterclaim as a sanction. After review of the district court record, the North Dakota Supreme Court concluded the district court abused its discretion when it dismissed the appellants’ counterclaim as a sanction for spoliation of evidence. Judgment was reversed and the matter remanded for a new trial. View "Toman Engineering Co. v. Koch Construction, et al." on Justia Law

Mark McAllister appealed an amended judgment of condemnation that ultimately allowed the City of West Fargo to use its eminent domain power to acquire a right of way across his property. After review of the district court record, the North Dakota Supreme Court concluded the district court did not err in holding West Fargo was authorized to use quick-take eminent domain procedures for its sewage improvement project. Furthermore, the Court concluded the trial court did not abuse its discretion in granting West Fargo’s motion in limine to exclude testimony from trial that the taking impacted McAllister’s property’s conformance with the city’s setback requirements. View "City of West Fargo v. McAllister" on Justia Law

Brenda and Gene Sauvageau petitioned the North Dakota Supreme Court to exercise its original jurisdiction and issue a writ of supervision directing the district court to stop the Cass County Joint Water Resource District from using quick take eminent domain to acquire their property. The Sauvageaus claimed the District was prohibited from using quick take eminent domain to acquire a permanent right of way easement over their entire property. The Supreme Court concluded the quick take process was not available because the District is taking more than a right of way in the Sauvageaus’ property. The Court granted the Sauvageaus’ petition, directed the district court to vacate its order denying the Sauvageaus’ motion to dismiss the District’s complaint and remanded for further proceedings. View "Sauvageau, et al. v. Bailey, et al." on Justia Law