Miller v. Simonson

Citation140 Idaho 287,92 P.3d 537
Decision Date24 June 2004
Docket NumberNo. 28537.,28537.
PartiesKatherine M. MILLER, a single woman, Plaintiff-Appellant, v. Rita SIMONSON, a single woman; and Judy C. Simonson, a single woman, Defendants-Respondents.
CourtUnited States State Supreme Court of Idaho

Hawley Troxell Ennis & Hawley LLP, Boise, for appellant. Lynnette M. Davis argued.

Rigby Thatcher Andrus Rigby Kam & Moeller, Chartered, Rexburg, for respondents. Gregory W. Moeller argued.

TROUT, Chief Justice.

Appellant Katherine Miller (Miller) appeals the district court's grant of partial summary judgment in favor of Respondents Rita and Judy Simonson (the Simonsons), finding that Miller had constructive notice of the Covenants, Conditions and Restrictions (CC & R's) placed upon a ten-acre tract of land she purchased in Teton County in 1997. Miller appeals the district court's determination on the basis that she had no actual notice of the CC & R's and also had no constructive notice because the CC & R's were incorrectly indexed by Teton County. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

In 1990 the Simonsons acquired real property in Teton County that they then platted into a subdivision called Redfeather Ranch. As a part of the subdivision, the Simonsons submitted for recording in the Teton County records, CC & R's restricting the use of their property. These restrictions included rules that only allowed property owners to construct fences of wood, that prohibited property owners from constructing any building within 100 feet of a property boundary, and which prohibited owners from keeping more than ten horses on a ten-acre parcel of land. However, the CC & R's were improperly indexed by Teton County officials under the name "Redfeather Ranch" instead of under the names of the Simonsons. Consequently, these CC & R's do not appear in the grantor-grantee index under the names of the Simonsons.

In 1994 the Simonsons submitted an Amendment to the CC & R's to Teton County to be recorded. The Amendment was not properly acknowledged and again, the instrument was improperly indexed by Teton County under the name Redfeather Ranch instead of under the names of the Simonsons.

The Redfeather Ranch subdivision included a particular ten-acre parcel ("the Property") that the Simonsons sold to Michael and Floyce Gallagher in 1990. In February 1997, Miller purchased the Property from the Gallaghers. Miller claims that at no time prior to the purchase did she receive actual notice of the CC & R's, even after specifically asking Michael Gallagher about any restrictions on use. Because Miller purchased the Property with the intent of raising and breeding horses, she constructed a shed within 100 feet of her property boundary and placed metal fence posts on the Property in furtherance of her plans.

In July 1997, Rita Simonson informed Miller of the existence of the CC & R's and demanded that Miller remove the fence posts and shed as they were in violation of its terms. In June 1998, Miller filed a declaratory judgment action in the district court alleging that because she had no actual or record notice of the CC & R's, she could not be forced to comply with them. On a motion for partial summary judgment by Miller, the district court found that because the Amendment to the CC & R's was not properly acknowledged it could not have been recorded, and therefore Miller could not have had notice as to its terms.

As to the original CC & R's, the district court found for the Simonsons, ruling that even though the CC & R's were not properly indexed by Teton County, the cases of Oregon Short Line R.R. Co. v. Stalker, 14 Idaho 362, 94 P. 56 (1908) and O'Connor v. Board of Comm'rs, 17 Idaho 346, 105 P. 560 (1909) are controlling and dictate that if a party submits an instrument governing real property to be recorded but the recording official fails to properly record it, subsequent purchasers of that real property are still on notice as to the instrument.

The Simonsons do not appeal the district court's findings as to the Amendment. Both parties stipulated to entry of a partial summary judgment and a Rule 54(b) certificate on the sole issue of whether the district court erred in holding that a subsequent purchaser of real property is charged with constructive notice of an instrument submitted for recording but improperly indexed by the official responsible for recording such instruments.

II. STANDARD OF REVIEW

In reviewing the district court's decision on a motion for summary judgment, the standard of review is whether there are any genuine issues of material fact, and, if not, whether the prevailing party was entitled to judgment as a matter of law. I.R.C.P. 56(c). If the evidence shows no disputed issues of material fact, what remains is a question of law, over which the appellate court exercises free review.

Sacred Heart Medical Center v. Boundary County, 138 Idaho 534, 535, 66 P.3d 238, 239 (2003). When there is controlling precedent in Idaho law "the rule of stare decisis dictates that we follow it, unless it is manifestly wrong, unless it has proven over time to be unjust or unwise, or unless overruling it is necessary to vindicate plain, obvious principles of law and remedy continued injustice." Houghland Farms, Inc. v. Johnson, 119 Idaho 72, 77, 803 P.2d 978, 983 (1990).

III. THE DISTRICT COURT PROPERLY GRANTED SUMMARY JUDGMENT

The primary issue in this case is whether an instrument submitted for recording according to law is considered to give constructive notice to subsequent purchasers when the recording officials do not properly record the instrument. In this case, we acknowledge that neither party is at fault for the circumstances giving rise to this appeal. The Simonsons presented the validly acknowledged CC & R's to the Teton County officials to be recorded. Because of the recording error in which the CC & R's were recorded under the name of "Redfeather Ranch" instead of the individual names of the Simonsons, Miller could not have realistically found the CC & R's by inspecting the grantor-grantee index, which normally gives notice of such instruments. Consequently, the rule of law promulgated by this Court will necessarily injure the interests of an innocent party.

I.C. § 55-809 defines when an instrument is validly recorded for purposes of giving constructive notice to subsequent purchasers. This statute states: "An instrument is deemed to be recorded when, being duly acknowledged, or proved and certified, it is deposited in the recorder's office with the proper officer for record." Furthermore, I.C. § 55-811 directs:

Every conveyance of real property acknowledged or proved, and certified, and recorded as prescribed by law, from the time it is filed with the recorder for record, is constructive notice of the contents thereof to subsequent purchasers and mortgag(e)es.
Every conveyance of real property acknowledged or proved, and certified, and recorded as prescribed by law, and which is executed by one who thereafter acquires an interest in said real property by a conveyance which is constructive notice as aforesaid, is, from the time such latter conveyance is filed with the recorder for record, constructive notice of the contents thereof to subsequent purchasers and mortgagees.

These two statutes provide what must be done by a person desiring to record a document so as to provide notice to other people. They are the crux of Idaho's constructive notice recording laws.

On appeal, Miller argues that certain sections in Title 31, Chapter 24 of the Idaho Code further this definition of when an instrument is deemed to be recorded. These sections, designating the recording official's duties when presented with a document for recording, do state that a recorded instrument is to be listed in the grantor-grantee index under the name of the party recording the instrument. Specifically, I.C. § 31-2413 provides that when presented with an instrument to be recorded, a county recorder should note in the index "the grantor, or person executing the instrument; [and] the grantee, or person to whom the instrument is executed, if there be such." Miller argues these statutory duties are meant to be part of the recording process and as such, an instrument cannot be considered recorded for purposes of constructive notice unless the county recorder takes these steps.

Though the steps required of county recorders in Title 31, Chapter 24 are necessary elements of the recording process, they were not meant by the legislature to be part of the process that designates when an instrument is deemed recorded for purposes of constructive notice. I.C. §§ 55-809 and 55-811 clearly state than an instrument is deemed to be recorded for purposes of constructive notice when it is duly acknowledged and presented to the recorder's office for recording. We do not read the provisions of Title 31, Chapter 24 in derogation of those statutes to say that something more is required in order for an instrument to be deemed recorded for constructive notice purposes. Sections 55-809 and 55-811 designate what the...

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    ...30 P.3d 970, 973 (2001). The crux of Idaho's constructive notice recording laws are Idaho Code §§ 55-809 and 55-811. Miller v. Simonson, 140 Idaho 287, 92 P.3d 537 (2004). Section 55-809 defines when an instrument is deemed recorded. That is not an issue in the present case. Section 55-811 ......
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