Elk Park Ranch, Inc. v. Park County
| Decision Date | 08 April 1997 |
| Docket Number | No. 96-664,96-664 |
| Citation | 54 St.Rep. 293,935 P.2d 1131,282 Mont. 154 |
| Parties | ELK PARK RANCH, INC., a Montana Corporation; Channell Libbey; David A. Haug; Charles Kesting; David Amsk; Robert Payne; and Lemont Land Corp., a Montana Corporation, Plaintiffs and Appellants, v. PARK COUNTY, a political subdivision of the State of Montana, and the Clerk and Recorder of Park County, Defendants and Respondents. |
| Court | Montana Supreme Court |
James A. McLean, Drysdale, McLean & Nellen, Bozeman, for Plaintiffs and Appellants.
Tara DePuy, Park County Attorney, Livingston, for Defendants and Respondents.
Appellants Elk Park Ranch, Inc., et al. (Landowners), appeal the decision of the Sixth Judicial District Court, Park County, granting Respondent Park County's motion for summary judgment.
The Landowners raise two issues on appeal:
1. Did the District Court err in determining that the Landowners could not create twenty-acre tracts of record from a larger parcel by executing and recording a series of one-party deeds prior to the effective date of 2. Did the District Court err in concluding that Park County was not equitably estopped from denying the Landowners' establishment of twenty-acre tracts and from refusing to accept the one-party deeds of conveyance for the twenty-acre tracts?
the 1993 amendments to the Montana Subdivision and Platting Act (the Subdivision Act)?
The facts in this case are not in dispute. The following agreed-upon facts and law are relevant to this appeal:
1. Park County is a political subdivision of the State of Montana. The Clerk and Recorder of Park County is an elected official. Elk Park and LeMont are Montana corporations having their principal offices in Livingston, Montana. The individual appellants are all residents of Park County, Montana.
2. Effective on April 6, 1993, the legislature of the State of Montana amended the Subdivision Act, found at § 76-3-101, et. seq., MCA. One such amendment changed the definition of what constitutes a subdivision in the State of Montana. The pertinent sections of the amended Subdivision Act that define a subdivision and that are material and relevant to this case are:
Section 76-3-103(14), MCA. "Subdivision" means a division of land or land so divided that creates one or more parcels containing less than 160 acres that cannot be described as a one-quarter aliquot part of a United States government section, exclusive of public roadways, in order that the title to or possession of the parcels may be sold, rented, leased, or otherwise conveyed and includes any resubdivision and further includes a condominium or area, regardless of its size, that provides or will provide multiple space for recreational camping vehicles or mobile homes.
Section 76-3-103(15), MCA. "Tract of record" means a parcel of land, irrespective of ownership, that can be identified by legal description, independent of any other parcel of land, using documents on file in the records of the county clerk and recorder's office.
Section 76-3-104, MCA. What constitutes subdivision. A subdivision comprises only those parcels containing less than 160 acres that cannot be described as a one-quarter aliquot part of a United States government section when the parcels have been segregated from the original tract. The subdivision plat must show all the parcels whether contiguous or not.
3. The size of land defined as a subdivision in the Subdivision Act prior to said amendments was 20 acres; that is, if a division of land was 20 acres or more, there was not a requirement to comply with the Subdivision Act.
4. Furthermore, prior to and after the 1993 amendments to the Subdivision Act, a survey of land (other than a subdivision) was not required for division of land for sale if the land could be described as a 1/32 or larger aliquot part of a United States government section or lot. Section 76-3-401, MCA.
5. In February or March of 1993, prior to the effective date of the amendments to the Subdivision Act of April 6, 1993, a representative of Elk Park and LeMont, namely Kelly Meyers (Meyers) and their counsel, Karl Knuchel (Knuchel) had informal unplanned meetings with the then Park County Commissioners, the then Park County Attorney, William Nels Swandal (Swandal), and the then Park County Clerk and Recorder. Knuchel and Meyers expressed to Park County the desire of Elk Park and LeMont to record deeds with Park County of certain tracts of land owned by them by describing the land in separate twenty acre aliquot tracts. The Park County officials understood that it was Elk Park and LeMont's goal to establish separate twenty acre tracts before the effective date of the amendments to the Subdivision Act, in order to allow them to sell the twenty acre tracts to third parties without being subject to the new amendments of the Subdivision Act requiring subdivision review, surveying and platting of tracts of 160 acres or less.
6. Elk Park and LeMont suggested that the land owned by them could be separately described by each owner all on a single deed, in twenty acre aliquot tracts wherein the owner would be both the grantor and the 7. The then Park County Commissioners and the then Clerk and Recorder advised Knuchel and Meyers that the legal opinion of the County Attorney would be required by them in the decision as to the type of deed(s) which would be acceptable to the county for recording.
grantee (a one-party deed). The other methods discussed were to have a separate deed for each twenty acre tract using a one-party deed, using a single deed or separate deeds by the use of a separate cooperative third party as the grantee (a "straw man"), who would then convey the twenty acre tracts back to the owners after recording the deed or deeds.
8. Swandal, the then Park County Attorney, was consulted and his opinion was that there was no legal impediments to recording the one-party deeds and he advised that the deeds could be recorded. He did not think it was necessary to use a straw man to create the separate twenty acre tracts. In his opinion as County Attorney, once a deed describing twenty acres in aliquot parts was filed before the effective date of the Subdivision Act, that deed would be of record and the parties could transfer the tracts out in accordance with that description.
The reasoning of the County Attorney at this time was that Elk Park could create a fictional legal entity and effectuate the transfer. However, the County Attorney felt that although Park County could require the filing of separate deeds for each tract, it was more efficient to allow the transfer on a one-party deed.
9. Based on the County Attorney's opinion and the County Commissioner's and Clerk and Recorder's acquiescence in that opinion, several one-party quit-claim deeds were recorded by the various Landowners.
10. In an action filed on May 24, 1993, for a Writ of Mandamus against the Ravalli County Clerk and Recorder, on July 12, 1994, the Montana Supreme Court decided Rocky Mountain Timberlands Inc. v. Lund (1994), 265 Mont. 463, 877 P.2d 1018, holding that a landowner cannot divide a large tract of land into twenty acre tracts by executing and recording a deed in which the grantor and the grantee are the same party. The Court held that such a deed was not a transfer and therefore not a division. The Court did not discuss in the decision the concept of "tracts of record" as defined in § 76-3-103(15), MCA. Prior to April 6, 1993, tracts of record were not defined in the Subdivision Act.
11. After the above decision came down, the then Park County Clerk and Recorder asked Swandal, the then Park County Attorney, if the one-party deeds should be removed from the record. Swandal told him, no, for two reasons: one, he thought that they were probably equitably estopped from doing so because of the previous meetings approving the filing of the one-party deeds and two, because he did not think the removal of the deeds could be accomplished without a court order.
12. On May 17, 1995, Denise Nelson (Nelson), the new Park County Clerk and Recorder, wrote and mailed the following letter to each of the Landowners:
Re: Aliquot part division of property.
On April 2, 1995, a document was recorded at the Park County Clerk and Recorder's Office describing the above property in aliquot parts. This does not constitute a division of land under Montana law. Attorney General's Opinion No. 66, Volume No. 38, states: "A segregation of one or more parcels of land from a larger tract held in single or undivided ownership constitutes a division of land under section 76-3-103(3), MCA, REGARDLESS OF HOW THE LARGER TRACT IS DESCRIBED IN RELATION TO ALIQUOT PARTS OF A UNITED STATES GOVERNMENT SURVEY."
Park County will not transfer any of the above described property and separate parcels unless they undergo subdivision review.
13. On July 1, 1995, Elk Park sold to Yellowstone II Development Group, Inc., a Montana Corporation (Yellowstone II), certain real property, including 28 twenty acre parcels described in the Elk Park one-party deeds referenced above. A "Notice of Purchaser's Interest in and to Real Property" referencing the sale from Elk Park to Yellowstone 14. On July 20, 1995, Tara DePuy (DePuy), who succeeded Swandal as Park County Attorney, wrote a letter to Jeffrey Pence, an attorney who represented certain parties who were opposed to the development of the Elk Park property and the sale to Yellowstone II, in which she stated "it is my opinion that Park County is estopped from denying the deeds that Elk Park is now recording."
II pursuant to an Agreement for Sale and Purchase of Real Estate and Option to Purchase Real Property under an installment contract was accepted and recorded by Nelson on July 14, 1995.
15. On or about August 30, 1995, a meeting was held with the Park County Commissioners, Park County Attorney, Clerk and Recorder, Park County Planner, the...
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