Bangerter v. Petty

• Decision Date: 20 October 2009
• Docket Number: No. 20080562.,20080562.
• Citation: 225 P.3d 874,2009 UT 67
• Parties: Sonya Capri BANGERTER, Plaintiff and Petitioner, v. Ralph PETTY, an individual; Jarmaccc Properties, LLC, a Utah limited liability company; Jarmaccc, Inc., a Utah corporation; and John Does 1 through 10, individuals and entities whose true names are unknown, and who may claim some right, title, estate, lien, or interest in real property owned by plaintiff, Defendants and Respondents.
• Court: Utah Supreme Court

225 P.3d 874

2009 UT 67

Sonya Capri BANGERTER, Plaintiff and Petitioner, v. Ralph PETTY, an individual; Jarmaccc Properties, LLC, a Utah limited liability company; Jarmaccc, Inc., a Utah corporation; and John Does 1 through 10, individuals and entities whose true names are unknown, and who may claim some right, title, estate, lien, or interest in real property owned by plaintiff, Defendants and Respondents.

No. 20080562.

Supreme Court of Utah.

October 20, 2009.

James C. Haskins, Ryan M. James, Salt Lake City, for petitioner.

Ralph C. Petty, Salt Lake City, for respondents.

On Certiorari to the Utah Court of Appeals.

INTRODUCTION

PARRISH, Justice:

¶ 1 We granted certiorari in this case to determine whether the court of appeals erred in concluding that Jarmaccc Properties, LLC (Jarmaccc) did not waive its statute of limitations defense. Because we hold that the statute of limitations does not bar an individual, in actual possession of real property under a claim of ownership, from asserting a quiet title action, we need not address whether Jarmaccc waived its statute of limitations defense. We therefore remand this case to the court of appeals to consider whether the district court erred in deciding Jarmaccc's remaining claims.

FACTS AND PROCEDURAL HISTORY

¶ 2 Sonya Capri Bangerter has continuously occupied the real property (the Property) disputed in this case since she purchased it in April 1994. She has paid all the real estate taxes on the Property from 1994 to the present,¹ and she is the only individual or entity that has made mortgage payments on the Property.

¶ 3 In April 1995, a judgment was entered against Bangerter in the amount of $307.46 for failure to pay for dental services,² which ultimately resulted in a writ of execution that commanded the sheriff "to collect the judgment, with costs, interest, and fees, and to sell enough of defendant's non-exempt real property to satisfy the same." A deputy sheriff filed a notice of real estate levy against the Property and it was subsequently sold in March 1996 at a public auction for $1,550.00 to North American Recovery Services (N.A.R.), a collection agency. Bangerter failed to redeem the property within six months, and as a result N.A.R. was given a sheriff's deed to the Property in September 1996. More than a year later, an amended real estate certificate of sale execution was filed to correct an error in the legal description of the property that was present in the original notice of real estate levy and certificate of sale execution. N.A.R. subsequently filed a quitclaim deed to the Property in favor of Jarmaccc.

¶ 4 Bangerter alleges she never received any notice that the Property would be sold at a public auction to satisfy the judgment for the unpaid dental services. Indeed, Bangerter asserts that she was unaware that Jarmaccc or anyone else claimed an adverse interest in the Property until March 1998. Even then, Bangerter claims that she was ignorant of Jarmaccc's adverse claim of actual title. Rather, she believed that Jarmaccc held only a lien on the Property.

¶ 5 In March 1998, Bangerter filed for Chapter 13 bankruptcy. Shortly after Bangerter filed, Jarmaccc served Bangerter with the first and only Notice to Quit the Property. However, Jarmaccc did not pursue the Notice to Quit,³ nor did it file a motion seeking relief from the automatic stay provisions of the bankruptcy code. After Bangerter's first bankruptcy was dismissed, Bangerter filed for bankruptcy a second time.⁴ In Bangerter's second bankruptcy action, she listed Jarmaccc as a secured creditor with a lien on the Property for $1,200.00. Bangerter's bankruptcy plan provided that "[a]ny lien or other claim against the title of debtor's real property securing the claim of Jarmaccc Properties shall be extinguished and released by payment through the Plan." Jarmaccc received a copy of Bangerter's bankruptcy plan and failed to lodge any objections. Bangerter then paid Jarmaccc the full amount set out in the bankruptcy plan.⁵ In August 2003, after Jarmaccc had received full payment under the terms of the bankruptcy plan, the bankruptcy court dismissed Bangerter's second bankruptcy petition.

¶ 6 In January 2004, Bangerter filed this action against Jarmaccc seeking to quiet title to the Property. Bangerter argued that title to the Property should be quieted in her because the sheriff's deed was void and Jarmaccc was equitably estopped from claiming any title to the property where it failed to object to Bangerter's second bankruptcy plan that listed Jarmaccc as a secured creditor and where Bangerter had paid Jarmaccc the full amount set out in that plan. In its answer, Jarmaccc asserted that the statute of limitations barred Bangerter's quiet title action, that Jarmaccc held title to the Property, and that the bankruptcy proceeding could not convey title back to Bangerter.

¶ 7 After both parties filed cross motions for summary judgment, the district court quieted title in Bangerter holding that (1) the original sale of the Property failed to convey any title because the deed contained an incorrect legal description, (2) Jarmaccc failed to object to the bankruptcy plan, and (3) Bangerter would be injured if Jarmaccc was "allowed to contradict its actions in accepting the payments made pursuant to the Chapter 13 plan." The district court also rejected Jarmaccc's statute of limitations arguments.

¶ 8 On appeal, the court of appeals reversed the district court and held that Jarmaccc did not waive its statute of limitations defense and that, pursuant to Nolan v. Hoopiiaina (In re Hoopiiaina Trust), 2006 UT 53, 144 P.3d 1129, the statute of limitations bars Bangerter's quiet title action against Jarmaccc. Bangerter v. Petty, 2008 UT App 153, ¶¶ 15-24, 184 P.3d 1249. Because the court of appeals held that Bangerter's quiet title action was barred by the statute of limitations, it did not consider whether the district court erred in its determination that Jarmaccc's deed was defective because of an incorrect legal description or whether Jarmaccc was equitably estopped from claiming title to the Property.

¶ 9 Bangerter petitioned for certiorari, which we granted. We have jurisdiction in this case pursuant to Utah Code section 78A-3-102(3)(a) (2008).

STANDARD OF REVIEW

¶ 10 "On certiorari review, we review the decision of the court of appeals, not the decision of the district court." Nolan v. Hoopiiaina (In re Hoopiiaina Trust), 2006 UT 53, ¶ 19, 144 P.3d 1129. We review "the court of appeals' decision for correctness, with particular attention to whether [it] reviewed the [district] court's decision under the correct standard." State v. Worwood, 2007 UT 47, ¶ 11, 164 P.3d 397. Summary judgment is appropriate where "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Utah R. Civ. P. 56(c).

"Therefore, when an appellate court reviews a district court's grant of summary judgment, the facts and all reasonable inferences drawn therefrom [are viewed] in the light most favorable to the nonmoving party, while the district court's legal conclusions and ultimate grant or denial of summary judgment are reviewed for correctness." Massey v. Griffiths, 2007 UT 10, ¶ 8, 152 P.3d 312 (alteration in original) (internal citation and quotation marks omitted).

ANALYSIS

¶ 11 We granted certiorari in this case to determine whether the court of appeals erred in holding that Jarmaccc did not waive its statute of limitations defense when it failed to identify the limitations statute it relied upon in its original Answer to Bangerter's complaint.⁶ Because we hold that the statute of limitations does not apply to quiet title actions where the claimant is in actual possession of the property in question under a claim of ownership, we need not address whether the court of appeals erred in holding that Jarmaccc did not waive its statute of limitations defense.⁷

I. A STATUTE OF LIMITATION NEVER BARS A PARTY FROM BRINING A QUIET TITLE ACTION WHEN THAT PARTY IS IN ACTUAL POSSESSION OF THE REAL PROPERTY AT ISSUE UNDER A CLAIM OF OWNERSHIP

¶ 12 In Branting v. Salt Lake City, we established the general rule that where "the action is purely one to remove a cloud or to quiet the title [to real property], the statute of limitations has no application." 47 Utah 296, 153 P. 995, 1001 (1915). However, in Branting we also held that "all actions in which the principal purpose is to obtain some affirmative relief ... clearly come within the [statute of limitations]." Id. More recently, in Nolan v. Hoopiiaina (In re Hoopiiaina Trust), we attempted to "clarify the rule regarding the application of the statute of limitations to a quiet title action." 2006 UT 53, ¶ 21, 144 P.3d 1129. In that case, we held that "a court must examine the relief sought in order to determine whether the statute of limitations applies." Id. ¶ 27. If the action is a true quiet title action, meaning an action merely to "quiet an existing title against an adverse or hostile claim of another," then the statute of limitations will not bar the claim. Id. ¶ 26 (internal quotation marks omitted) (emphasis in original). However, "[i]f the party's claim for quiet title relief can be granted only if the party succeeds on another claim, then the statute of limitations applicable to the other claim will also apply to the quiet title claim." Id. ¶ 27.

¶ 13 Relying on our analysis in In re Hoopiiaina Trust, Jarmaccc argues that Bangerter's claim is not a true quiet title action because Bangerter must first succeed on her claim to void the sheriff's deed before she can have title quieted in her, and therefore the statute of limitations bars Bangerter's claim to the Property. Bangerter, on the other hand, argues that In re Hoopiiaina Trust is distinguishable from this case on the basis that it did not involve a quiet title action where the claimant was in actual possession of the property....