Lutz v. Schmillen
| Decision Date | 18 April 1996 |
| Docket Number | No. 95-80,95-80 |
| Citation | 915 P.2d 599 |
| Parties | Kennis LUTZ, Marsha Lutz, Loren Lutz, and Marion Lutz d/b/a Elk Track Ranch and Sheriden Trails; and Elk Track Ranch, Inc., a Wyoming business corporation, Appellants (Defendants), v. Scott SCHMILLEN and Josephine Schmillen, Appellees (Plaintiffs). |
| Court | Wyoming Supreme Court |
Lawrence B. Hartnett, Jackson, for Appellants.
Andrew L. Breffeilh, Jackson, for Appellees.
Before GOLDEN, C.J., and THOMAS, MACY, TAYLOR, and LEHMAN, JJ.
The only issue before the court in this case is whether the right of Kennis Lutz, Marsha Lutz, Loren Lutz, and Marion Lutz, d/b/a Elk Track Ranch and Sheriden Trails, and Elk Track Ranch, Inc. (collectively Lutz) to due process of law was infringed in connection with the confirmation of sale of real property pursuant to a court ordered execution. Lutz filed a Defendants' Objection to Sale of Property in which the improprieties asserted were that the expenses of an appraisal and expert witness fees from the trial of the case were included as costs of the execution and charged to Lutz; the failure of the sheriff to obtain an appraisal pursuant to WYO.STAT. § 1-17-316 (1988), using instead an appraisal previously obtained and paid for by Scott and Josephine Schmillen (Schmillen); and the request by Schmillen for an order confirming sale. We hold Lutz was entitled to a hearing with respect to the costs of execution charged in connection with the sale. We find no error in reliance upon a prior appraisal for purposes of a public sale nor in granting the motion for the order confirming sale except with respect to the costs. We reverse and remand to the district court to hold the hearing impliedly required by the statute at which it can consider whether trial expenses charged to Schmillen were improperly included in the costs of execution.
In the Appellants' Brief, Lutz articulates the single issue as:
A. Did the trial court err by failing to hold an evidentiary hearing, as requested by appellants, to present evidence to the court, through the testimony of witnesses, that an execution sale of appellants' real property was not in conformance with the provisions of the Wyoming Code of Civil Procedure; namely, §§ 1-17-301 et seq., in violation of appellants' right to due process of law.
In the Appellees' Brief, Schmillen does not state an issue but, instead, states these arguments:
A. The second appeal is rendered moot by the appellants [sic] redemption of the property.
B. The appellants failed to demonstrate appealable error.
C. The appellants failed to show that they were prejudiced by any alleged error.
D. Costs and penalties are appropriate.
The legal dispute between these parties is set forth in Lutz v. Schmillen, 899 P.2d 861 (Wyo.1995). The district court appointed a special master to wind up partnership affairs between the parties. To satisfy a judgment entered upon the report of the special master, real property belonging to Lutz was ordered sold at a public sale. The record discloses an appraisal of the subject property was made in the spring of 1994. That appraisal was ordered and paid for by Schmillen. The original public sale was postponed and ultimately held on November 10, 1994. Schmillen then moved for entry of an order confirming sale, and the sheriff submitted the Sheriff's Return and Report of Sale. These pleadings were both filed on November 10, 1994 and, on November 14, 1994, the district court issued an Order Concerning Motion to Confirm Sale, which required Lutz to file any response to the requested confirmation of sale within ten days.
Lutz did file a Defendants' Objection to Sale of Property on November 23, 1994, and Schmillen submitted a reply. Without the benefit of any hearing, the district court, on December 20, 1994, entered its Order Confirming Sale stating in part:
1. The sale of the real property seized in execution was in all respects regularly and fairly advertised, made and conducted in accordance with the Judgment and Order of Sale entered into in this case. The Defendants' objections thereto are speculative lacking in persuasive authority and wholly lacking in evidence.
The Lutz take their appeal from that order.
While the authority to charge the judgment debtor with the costs of execution in connection with the levy of execution upon real property is somewhat speculative, we have no question that this is the practice in Wyoming. WYO.STAT. § 1-17-316(c) (1988) provides:
If upon the return it appears that two-thirds ( 2/3) of the appraised value of the judgment debtor's interest in the real estate levied upon is sufficient to satisfy the execution with costs, the judgment on which the execution is issued shall not operate as a lien on the residue of the debtor's estate to the prejudice of any other judgment creditor. Except as expressly authorized by law, no real estate shall be sold for less than two-thirds ( 2/3) of the appraised value of the judgment debtor's interest in the property.
This appears to be the statutory justification for charging costs against the judgment debtor.
We note from Lutz, 899 P.2d at 863, that the special master filed his final report on October 29, 1993, and the judgment was filed simultaneously. Other than the fees of the special master, the parties were required to bear their own costs. The Sheriff's Return and Report of Sale and canceled checks, all dated the same day of the sale, show Schmillen to have been paid $389,522.94, the amount of the judgment with interest and costs, plus $10,127.50 for reimbursement of fees paid to Hoffman & Associates Appraisers. The Hoffman fees were broken down as follows:
3"31"94 $4,000.00 Narrative appraisal: Elk Track Ranch, 35 miles
northeast of Jackson, Wyoming; property of Elk
Ranch, Inc
7"9"93 $1,625.00 Jackson Hole Dude Ranch preparation for court
and court time @ $100 per hour: 16.25 hours for
dates of 6"25"93 to 6"29"93
3"10"93 $ 67.50 Secretarial work, 7.5 hours @ $9.00
3"5"93 $4,000.00 Narrative appraisal: Jackson Hole Dude Ranch
Fish Creek Drainage, Teton County, WY
property of Scott and Josephine Schmillen
1"13"93 $ 210.00 Snowmobile Rental
1 machine @ $105
2 machine @ $105 (share 50"50 with
Moeller Appraisal)
1"13"93 $ 75.00 3 Extra copies of the Appraisal @ $25 each
11"12"92 $ 150.00 Darrel Hoffman, 1.5 hours @ $100 for Review of
Preliminary Value Letter of Oct. 14, 1992,
prepared by Charles R. Blazek: Elk Track Ranch,
Teton County, WY; property of Kennis, Marsha,
Loren and Marion Lutz
It is clear from the breakdown that $6,127.50 of the Hoffman fee was attributed to dates prior to the filing of the final report by the special master and antedating the judgment of the court. Without more information, those charges appear to be related to the resolution of the lawsuit and did not attach as costs of execution.
Lutz contends the Fourteenth Amendment to the Constitution of the United States providing, " * * * nor shall any State deprive any person of life, liberty, or property, without due process of law * * *," and Article 1, Section 6 of the Constitution of the State of Wyoming providing, "[n]o person shall be deprived of life, liberty or property without due process of law" address the sale of property upon execution. Lutz then contends the provisions of WYO.STAT. §§ 1-17-301 to -345 (1988) articulate the process that is due them under the law of the state of Wyoming. In particular, WYO.STAT. § 1-17-321 requires the court to find "that the sale was made in all respects in conformity with the code of civil procedure * * *." This court has held that, in the confirmation of the sale on mortgage foreclosure, objections to the sale and confirmation must be seasonable and specific. Grieve v. Huber, 41 Wyo. 168, 283 P. 1105, reh'g denied, 285 P. 788 (1930). Lutz satisfied this requirement.
We believe this court spoke with wisdom about such situations in Barber v. Barber, 349 P.2d 198, 201 (Wyo.1960):
Even had the receivers acted within the limited scope of the court's order and sold the property to the highest and best bidders, it would have been necessary to permit a hearing upon defendant's protest. Plaintiff urges that the hearing on an application for confirmation is limited to the face of the proceedings, and we think this is correct, but even so, all interested persons are entitled to be heard before a judicial sale is confirmed by final decree. The hearing, or an opportunity to be heard, is an essential element of due process of law. In L.C. Jones Trucking Co. v. Superior Oil Co., 68 Wyo. 384, 234 P.2d 802, we noted...
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