Evertson v. Sibley

Decision Date18 November 2022
Docket NumberSupreme Court No. S-17791
Citation520 P.3d 157
Parties Krister EVERTSON, f/k/a Kris Eriksson, Appellant, v. Lillian Eriksson SIBLEY, f/k/a Lillian K. Eriksson-Hebdon and Lillian K. Hebdon; Lillian K. Hebdon Living Trust; First National Bank Alaska; and Mat-Su Title Agency LLC, Appellees.
CourtAlaska Supreme Court

Krister Evertson, pro se, Wasilla, Appellant.

Anna C. Crary and Bruce A. Moore, Landye Bennett Blumstein LLP, Anchorage, for Appellees.

Before: Winfree, Chief Justice, Maassen, Carney, Borghesan, and Henderson, Justices.


MAASSEN, Justice.


A mother, son, and daughter conveyed real property among themselves by competing deeds. The daughter used the property as security for two bank loans and defaulted on the second one; when the bank attempted foreclosure, the son, claiming to be the property's owner, brought suit against the bank on a constructive notice theory, also alleging that the daughter's deed to the property was void because of fraud. The superior court found that the bank lacked notice of the son's alleged adverse interest and granted it summary judgment as a bona fide lender. The court also dismissed the fraud claim.

The son appeals. We affirm the grant of summary judgment on the bank's bona fide lender status, but we remand for a determination of whether the daughter acquired her deed as a result of fraud in the factum, which, if proven, would render her title and the bank's mortgage interest void.

A. Facts

This appeal concerns competing claims to a tract of real property in Wasilla. In January 2004 the owner, Krister Evertson, conveyed the property to his mother, Karin Eriksson, by a quitclaim deed he recorded in June. In August Karin conveyed the property back to Krister,1 but the deed memorializing this reconveyance was not recorded until October 2011, over seven years later.

In the meantime, in April 2008, Karin executed another quitclaim deed conveying the same property to her daughter Lillian Sibley, Krister's sister. The dispute here is focused in part on the circumstances of that conveyance. Krister asserts that "Lillian obtained title through fraud" because she "exercised undue influence and fraudulently caused Karin to sign [the] Quitclaim Deed." He asserts that Karin had been diagnosed with dementia and was "incapable of comprehending the nature or impact of the document" she was signing.

The quitclaim deed from Karin to Lillian was recorded one day after it was signed. A little over a week later, on April 30, 2008, Lillian pledged the property to First National Bank of Alaska (FNBA) as collateral to secure a $120,000 loan. The deed of trust was recorded on May 1.

On May 8 Krister signed another quitclaim deed to the property. This deed purported to transfer the property from himself and Karin to "Denali Trust." Krister admits that no trust with that name was actually created, and that Denali Trust was a fictional entity he "envisioned ... as a way to help protect [his] mother ... against fraud." He nonetheless recorded the deed to Denali Trust on May 20, 2008.

Lillian paid off her first FNBA loan in 2010 and a few months later entered into another loan agreement with FNBA for $200,000, again secured by a deed of trust on the property. This deed of trust was recorded in October 2010. In October 2011 Krister recorded the 2004 deed reflecting Karin's conveyance of the property to him.

Sometime around April 2018, Lillian defaulted on her second FNBA loan, and the bank prepared for a non-judicial foreclosure sale. Krister asserts that he was living on the property and taking care of Karin at the time.

B. Proceedings

In September 2018 the Alaska Office of Elder Fraud and Assistance filed a complaint against Lillian alleging that she had "committed Elder Fraud as defined in AS 44.21.415(g)(1)(C)[2 ] by causing [Karin] to sign a Quitclaim Deed," had failed to tender consideration for the deed, and had breached a duty of good faith and fair dealing.3 Two months later Krister recorded a lis pendens against the property and filed his own complaint against Lillian and FNBA, alleging that he had title to the property through adverse possession.4 FNBA moved for summary judgment; it argued that Krister's adverse possession claim failed because his attempted conveyance to the admittedly fictional Denali Trust precluded him from asserting a good faith claim to title.

Krister moved for leave to file an amended complaint containing three claims: (1) that Lillian had committed "fraud in the factum," a type of fraud that generally involves obtaining a person's signature through trickery;5 (2) that FNBA had actual and constructive notice of Krister's 2008 deed to Denali Trust when it made its second loan to Lillian; and, again, (3) that he had adversely possessed the property. FNBA did not oppose Krister's addition of a fraud in the factum claim, but it asked that Krister's second and third claims be denied because they were "identical to the original Complaint and should be resolved as a matter of law" on FNBA's pending motion for summary judgment.

FNBA then filed another summary judgment motion, asserting that it was a bona fide lender6 with no notice of Krister's adverse claim to the property or Lillian's alleged fraud in obtaining title. In opposition Krister contended that FNBA had constructive notice of his 2008 deed to Denali Trust because it would have discovered the deed had it conducted a "No Plat Subdivision Search" on the Department of Natural Resources’ website. He also argued that FNBA had inquiry notice of possible fraud in Lillian's acquisition of title given multiple indicia of fraud associated with her 2010 loan application.

The court granted Krister's motion for leave to amend his complaint, but at the same time it granted FNBA summary judgment on Krister's adverse possession claim. A month later it granted FNBA summary judgment on the bona fide lender issue as well, concluding that FNBA lacked actual or constructive notice of any claims with priority over Lillian's interest in the property. Krister then filed his amended complaint, now limited to an assertion that Lillian had acquired her deed from Karin as a result of fraud and that Lillian's deed and conveyance to FNBA were therefore void.

FNBA moved for the entry of final judgment, asserting that all of Krister's claims had been resolved by the court's two summary judgment orders. FNBA also answered Krister's amended complaint, asserting that it was barred by the summary judgment orders and failed to assert a claim entitling him to relief. Krister opposed the entry of final judgment, arguing that his fraud in the factum claim remained to be litigated.

The superior court entered final judgment in favor of FNBA, invalidated and expunged Krister's lis pendens, and dismissed Krister's amended complaint with prejudice. Krister moved for reconsideration, which the superior court denied.

Krister appeals, arguing that the superior court erred by deciding FNBA was a bona fide lender and by dismissing his amended complaint.


"We review a grant of summary judgment de novo and will affirm the judgment if there are no contested issues of material fact and if the moving party is entitled to judgment as a matter of law."7 Whether someone is a bona fide lender is a question of law we review de novo.8 "We apply our independent judgment to questions of law, adopting ‘the rule of law most persuasive in light of precedent, reason, and policy.’ "9 "We review trial court decisions regarding motions to dismiss de novo, deeming all facts in the complaint true and provable."10

A. It Was Not Error To Decide On Summary Judgment That FNBA Was A Bona Fide Lender.

The superior court concluded that FNBA had neither actual nor constructive notice of an adverse interest in the property and therefore was a bona fide lender with priority over any claim of Krister's. "A bona fide purchaser is one who ‘acquired title without notice, actual or constructive, of another's rights and also must have paid value for the same’ ";11 the rules applicable to bona fide purchaser status apply equally to lenders.12 Krister argues that FNBA had constructive notice of his 2008 deed to Denali Trust and inquiry notice of Lillian's potential fraud, and therefore it was error to grant summary judgment on this issue to FNBA. But we agree with the superior court's conclusion that FNBA was a bona fide lender.

1. FNBA had no notice of Krister's 2008 deed to Denali Trust.

Krister did not dispute the basic facts underlying the court's decision of FNBA's bona fide lender status on summary judgment: FNBA's first loan to Lillian, in April 2008, preceded Krister's purported conveyance of the property to Denali Trust in May of that year, and when FNBA conducted a title search before making its second loan to Lillian in 2010, it did not discover Krister's deed to Denali Trust because the deed was outside the chain of title. Nor did Krister dispute that FNBA's inquiry included not only a search for conveyances in the chain of title using Lillian's name, but also a tract search to locate all documents referencing the subdivision plat number since 1976. FNBA's inquiry did not reveal Krister's 2008 deed to Denali Trust because the deed did not contain the property's subdivision plat number.

A "buyer is only charged with ‘constructive notice of all the facts which [it] might have learned by means of a due and reasonable inquiry.’ "13 Alaska Statute 40.17.080(a) provides that "from the time a document is recorded in the records of the recording district in which land affected by it is located, the recorded document is constructive notice of the contents of the document to subsequent purchasers and holders of a security interest in the ... property." We held in Sabo v. Horvath , however, that a deed "recorded outside the chain of title[ ] does not give constructive notice to [a purchaser] and is not ‘duly recorded’ under the Alaskan...

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