Opinion
No. C5-02-732.
Filed December 3, 2002.
Appeal from the District Court, St. Louis County, File No. C500601207.
Thomas W. Reed, Andresen, Haag, Paciotti Butterworth, P.A., (for appellant)
John F. Hedtke, Hedtke Law Office, (for respondents Hendrickson and Bruckelmyer)
Robert C. Maki, Shawn B. Reed, Maki Overom, Chartered, (for respondent Maki Overom, Chartered)
John N. Nys, (for respondent The Markham Company)
Jack Setterlund, (for respondent Sullivan Setterlund, Ltd.)
Considered and decided by Shumaker, Presiding Judge, Schumacher, Judge, and Klaphake, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2002).
UNPUBLISHED OPINION
A judgment-lien creditor purchased the debtor's real estate at an execution sale. The debtor's assignee redeemed. The creditor arranged for a second execution sale, and the debtor and his assignee contended that the law does not permit a second execution sale to satisfy an outstanding judgment lien. The district court held that it had previously ruled that a second sale is proper and that the debtor's assignee is barred by res judicata, collateral estoppel, and law of the case from relitigating the issue. We affirm.
FACTS
Stanley Henricksen owned two parcels of real estate in St. Louis County. His brother, Kent Henricksen, obtained a judgment against him in the sum of $241,786.86. Kent levied on Stanley's real estate, and the sheriff conducted an execution sale. Kent purchased the property for $22,500. Stanley then quitclaimed his interest in the real estate to a third brother, Dwane Henricksen, who redeemed the property.
Next, Stanley and Dwane brought a declaratory-judgment action against Kent, seeking a determination that the sheriff's sale at which Kent purchased the property was void. Through his answer, Kent sought a judgment that declared the execution sale valid, that Dwane took no greater interest than Stanley was able to convey, and that the property remained subject to Kent's judgment lien in the sum still outstanding. The district court ruled that the execution sale was valid and that the property still remained subject to Kent's lien, to the extent unsatisfied. There was no appeal challenging these rulings.
Kent then levied on the real estate a second time and scheduled an execution sale. Stanley and Dwane moved to cancel the sale. The district court denied the motion but ordered that the sale proceeds be deposited with the court. The sheriff held the sale, and Kent bought the property for $75,000. After no redemption occurred and the redemption period expired, Kent moved the district court to confirm the sale. Stanley and Dwane objected, but the court granted the motion. Stanley and Dwane appealed. Henricksen v. Henricksen, Nos. C7-99-333 C7-99-395 (Minn.App. Nov. 2, 1999) ( Henricksen I).
This court held that the district court's first judgment, from which no appeal was taken, fully resolved the issues regarding the validity of the first execution sale and the extent of Dwane's interest in the real estate. This court held the subsequent judgments void and vacated them. While Henricksen I was pending, Kent conveyed his interest in the real estate to the respondents.
After this court decided Henricksen I, Dwane brought a quiet-title action, seeking a judgment that declared him the fee owner of the real estate. Respondents moved to dismiss the action. The district court granted summary judgment in favor of respondents. Dwane appealed. Henricksen v. Bruckelmyer, No. C0-01-272 (Minn.App. Oct. 23, 2001) ( Henricksen II).
Dwane contended on appeal that the law does not allow a second execution sale after an execution sale has already been held. The district court had not dealt with this issue. Because the record was insufficient for meaningful review, this court remanded the case for the district court to determine whether the propriety of a second sale had already been decided and, if so, on what theory. If that issue had not been decided, the district court was to address the issue.
On remand of Henricksen II, the district court ruled that the parties had previously litigated the propriety of the second execution sale and that the parties did not appeal the court's judgment regarding this sale. The district court then concluded that relitigation of this issue was precluded by res judicata, collateral estoppel, and law of the case. Dwane then brought this appeal.
DECISION
This appeal arises out of the district court's order dated November 9, 2000, that granted to respondents summary judgment and dismissed appellant's quiet-title action. On appeal from summary judgment, we determine whether there are any genuine issues of material fact in dispute and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990) (citation omitted). The parties in this case agree that the material facts are not in dispute. On appeal from a summary judgment where the parties agree that the material facts are not in dispute, we review de novo whether the district court erred in its application of the law. My Brother's Keeper v. Scott County, 621 N.W.2d 479, 480 (Minn.App. 2001).
There are two issues in this appeal: first, whether the district court had ruled on the propriety of a second execution sale; and, second, whether the district court or this court ever determined that the second sheriff's sale contained procedural irregularities.
Propriety of Second Sale
Appellant Dwane Henricksen argues that the issue regarding the propriety of allowing a second execution sale was not previously asserted in the declaratory-judgment action. We disagree and conclude that the district court properly determined that collateral estoppel bars appellant from challenging the propriety of proceeding with a second sheriff's sale.
Collateral estoppel precludes litigation of any issue that a party had a full and fair opportunity to litigate in a prior proceeding. Collateral estoppel applies in a later proceeding when
(1) the issue was identical to one in a prior adjudication; (2) there was a final judgment on the merits; (3) the estopped party was a party or in privity with a party to the prior adjudication; and (4) the estopped party was given a full and fair opportunity to be heard on the adjudicated issue.
Aufderhar v. Data Dispatch, Inc., 452 N.W.2d 648, 650 (Minn. 1990) (citation omitted). The doctrine applies even if the subsequent proceeding is predicated on a different cause of action. Hauser v. Mealey, 263 N.W.2d 803, 806 (Minn. 1978).
The question of the legal propriety of a second sheriff's sale was an issue raised in both the declaratory-judgment action and the current quiet-title action. In their declaratory-judgment action, Stanley and Dwane asked the court to declare that the first sheriff's sale was invalid. In response, Kent asked the court to find the sale valid and to rule that Dwane took no greater title and interest in the real estate than Stanley was able to convey, and, thus, the property remained subject to Kent's partially satisfied judgment lien. During summary-judgment motion proceedings in that action, Stanley and Dwane argued that they should not be
in a position of not knowing whether or not Stanley Henricksen is released from any obligation under the Judgment against him, and Dwane Henricksen is entitled to know what his rights are.
The district court noted that if the property is redeemed the owner gets the property back, but it is still subject to the lien "and you can levy again and again and again." The district court also indicated that whether it
declares the sheriff's sale null and void or not the property is still subject to a judgment lien in favor of Kent, in whosever [sic] hands the title is in.
It seems inescapable that the parties were litigating issues of the validity and enforcement of the judgment lien.
After the hearing, the district court ordered judgment declaring that the real estate remained subject to the unsatisfied judgment lien. Neither Stanley nor Dwane appealed. And in Henricksen I, this court held that the final judgment in the declaratory-judgment action determined the nature and extent of the parties' respective interests. The issue of the propriety of a second execution sale was litigated and finally determined on the merits in the declaratory-judgment action.
Appellant sought to raise the identical issue in the quiet-title action. The parties to both actions were either the same or in privity with prior parties. Appellant was a party in both actions, and respondents were in privity with Kent because he conveyed all his title and interest to them. See SMA Servs., Inc. v. Weaver, 632 N.W.2d 770, 774 (Minn.App. 2001) (noting that parties in privity "are those so connected with one another in law as to be identified with each other in interest") (citation omitted).
Finally, there is nothing in the record to suggest that appellant did not have a full and fair opportunity to be heard in the declaratory-judgment action. He was represented by counsel who set forth and argued appellant's position through pleadings, motion papers, memoranda, and oral argument, which are customary and proper ways for a litigant to fully present his case on the merits.
All of the elements of collateral estoppel have been satisfied. The district court did not err in precluding appellant from challenging the propriety of the second execution sale.
Regularity of Second Sale
Appellant also challenges the manner in which the second execution sale was executed. We find appellant's challenge on this matter to be untimely.
Under Minnesota law:
When a sale of real property is made upon execution, or pursuant to a judgment or order of a court, unless otherwise specified therein, the officer shall execute to the purchaser a certificate containing:
(1) A description of the execution, judgment, or order;
(2) A description of the property;
(3) The date of the sale and the name of the purchaser;
(4) The price paid for each parcel separately;
(5) If subject to redemption, the time allowed by law therefor.
Such certificate shall be executed, acknowledged, and recorded in the manner provided by law for a conveyance of real property, shall be prima facie evidence of the facts therein stated, and, upon expiration of the time for redemption, shall operate as a conveyance to the purchaser of all the right, title, and interest of the person whose property is sold in and to the same, at the date of the lien upon which the same was sold.
Minn. Stat. § 550.22 (2002) (emphasis added). Accordingly, appellant should have raised any alleged irregularities in the conduct of the second sheriff's sale before the redemption period had expired.
Our review of the record reveals that, before the second sheriff's sale, appellant challenged the amount allegedly remaining on the judgment, claiming that the amount stated on the notice of sale was not correct because appellant's previous redemption payment was not subtracted from the total judgment. Appellant then sought an order canceling the sheriff's sale until appellant was properly credited with his prior payment toward the judgment. The district court's March 1997 order stated that the notice of sale failed to reflect appellant's previous payments on the judgment debt. This court vacated the March 1997 order for lack of subject-matter jurisdiction, and appellant did not thereafter challenge the conduct of the second sheriff's sale during the statutory redemption period.
Because appellant failed to redeem the property or to otherwise challenge the manner in which the second sale was executed within the one-year redemption period as required by Minn. Stat. § 550.24(b) (2002), he cannot now challenge the title to the property. Because the time for redemption has expired, Kent Henricksen, the purchaser of the property at the sheriff's sale, now holds all right, title, and interest in the property. See id. Affirmed.