Rabo Agrifinance, Inc. v. Rock Creek Farms

Decision Date21 August 2013
Docket Number26490.,Nos. 26486,s. 26486
Citation836 N.W.2d 631,2013 S.D. 64
CourtSouth Dakota Supreme Court
PartiesRABO AGRIFINANCE, INC., f/k/a AG Services of America, Inc., and Rabo Agriservices, Inc., Plaintiffs, v. ROCK CREEK FARMS, Defendant and Appellant, and David M. Finneman; Connie S. Finneman; successors in interest to David M. Finneman and Connie S. Finneman, d/b/a Airport Farms, Defendants and Appellants, and Michael Arnoldy and Ann Arnoldy, Defendants and Appellees, Farm Credit Services of America, f/k/a Farm Credit Services of the Midlands FCLA; Black Hills Federal Credit Union; Lutz/Laidlaw Partnership; AXA Equitable Life Insurance Company; Laidlaw Family Partnership; Tom J. Wipf; Amy Wipf; Johnny Jay Wipf, d/b/a Wipf Farms; Joann Wipf; Cen–Dak Leasing of North Dakota, Inc.; Sheehan Mack Sales and Equipment, Inc.; Farm Capital Company, LLC; Daniel R. Mahoney; Portfolio Recovery Associates, LLC; Pfister Hybrid Corn Co.; Kaup Seed & Fertilizer, Inc.; Joyce M. Wolken; Charles W. Wolken; Stan Anderson; Dennis Anderson; Kent Kjerstad; William J. Huber; Kenda K. Huber; Yu Blue SNI, LLC; U.S. Bancorp Equipment Finance, Inc.; Kenco Inc., d/b/a Warne Chemical & Equipment Company, Inc.; Doug Kroeplin AG Services, Inc.; Credico, Inc., d/b/a Credit Collections Bureau; Scot D. Eisenbraun; Melody Eisenbraun; Bart Cheney; Hal Oberlander; Kei Oberlander; Ray S. Olsen; Patrick X. Trask; Rose Mary Trask; Pennington County, South Dakota; Meade County, South Dakota; and The United States of America, Defendants.

OPINION TEXT STARTS HERE

Steven W. Sanford, Alex M. Hagen of Cadwell, Sanford, Deibert & Garry, LLP, Sioux Falls, South Dakota and Brian L. Utzman of Smoot & Utzman, PC, Rapid City, South Dakota, Attorneys for defendant and appellant Rock Creek Farms Appeal # 26486.

James P. Hurley of Bangs, McCullen, Butler, Foye & Simmons, LLP, Rapid City, South Dakota, Attorneys for defendants and appellants Finnemans Appeal # 26490.

Vince M. RocheElizabeth S. Hertz of Davenport, Evans, Hurwitz & Smith, LLP, Sioux Falls, South Dakota and Robert R. Schaub of Sundall, Schaub & Fox, PC, Chamberlain, South Dakota, Attorneys for defendants and appellees Arnoldys.

WILBUR, Justice.

[¶ 1.] David and Connie Finneman (Finnemans) (Appeal No. 26490) and Rock Creek Farms (RCF) (Appeal No. 26486), collectively referred to as Appellants, appeal the trial court's denial of Appellants' motions pursuant to SDCL 15–6–60(b)(Rule 60(b)). We affirm.1

FACTS AND PROCEDURAL BACKGROUND

[¶ 2.] Finnemans owned nearly 17,000 acres of farmland in Pennington and Meade Counties. The property was the subject of many mortgages, liens, and judgments.

[¶ 3.] In an effort to save their family farm from foreclosure, Finnemans deeded the property to RCF, an entity formed by Finnemans and an outside investor. RCF, Finnemans' successor in interest, funded a series of redemptions of the property. Michael and Ann Arnoldy (Arnoldys), brother and sister, purchased existing judgments on the property.

[¶ 4.] In July 2009, Rabo Agrifinance, Inc. and Rabo AgServices, Inc. (Rabo) initiated foreclosure proceedings (Rabo foreclosure) against Finnemans, RCF, and all parties who had or may have had an ownership or leasehold interest in the land. In the foreclosure pleadings, Rabo asserted: “The terms of the Loan Restructure Agreement further provide that David M. Finneman and Connie S. Finneman agree to waive all redemption rights to Rabo under any successful foreclosure by Rabo on any of the properties covered by the original mortgage and note, and any additions or amendments thereto.” Further, Rabo sought the court to “enter an order waiving all redemption rights held by Defendants David M. Finneman and Connie S. Finneman and Rock Creek Farms, successors in interest to David M. Finneman and Connie S. Finneman pursuant to the terms of the loan restructure agreement[.]

[¶ 5.] In late 2009, Rabo moved for judgment on the pleadings. On January 15, 2010, Judge John J. Delaney granted the motion and entered a judgment and decree of foreclosure in the Rabo foreclosure proceedings. Contrary to the foreclosure pleadings, the judgment and decree of foreclosure stated in pertinent part: “In particular, and notwithstanding any contrary or other provisions of the Mortgage or any related agreements, Defendant Rock Creek Farms is determined and adjudged to have the owner's right of redemption for a period of one year and other redemption rights under SDCL Chapter 21–52.” Further, the order stated: Plaintiff's Motion for Judgment on the Pleadings shall be and hereby is in all respects granted.” Arnoldys did not appeal from the Rabo foreclosure judgment or file a post-judgment motion disputing the provisions of the judgment at that time.2

[¶ 6.] In August 2010, RCF's counsel sent correspondence to Arnoldys' counsel, enclosing the judgment and decree of foreclosure, which stated: “Rock Creek Farms is adjudged as having the final owner's right of redemption as to the entirety of the property, which is res judicata as concerns our respective clients and their disputes.”

[¶ 7.] On May 12, 2011, Arnoldys sought to have the judgment and decree of foreclosure set aside by filing a motion for relief pursuant to SDCL 15–6–60(b). Judge Delaney entered an order on May 26, 2011, which granted Arnoldys' motion and vacated the portion of the judgment on the pleadings and decree of foreclosure that recognized RCF's final redemption rights. RCF filed motions to reconsider, for a new trial, for relief from judgment, and for a stay, or alternatively, for a temporary restraining order. Judge Delaney denied these motions on July 12, 2011. RCF and Finnemans each then appealed Judge Delaney's May 26, 2011 ruling to this Court.3 In March 2012, this Court dismissed these appeals because the United States, a party defendant, was not timely served with the notice of appeal. Rabo Agrifinance, Inc. v. Rock Creek Farms ( Rabo I ), 2012 S.D. 20, 813 N.W.2d 122.

[¶ 8.] On May 10, 2012, RCF sought relief from Judge Delaney's May 26, 2011 order at the trial court level pursuant to SDCL 15–6–60(b). Finnemans joined RCF in its motion to set aside the judgment. On May 29, 2012, Finnemans filed their own motion pursuant to SDCL 15–6–60(b), and additionally, asked the trial court to void the sheriff's deed that had been issued to Ann Arnoldy, as a result of the May 26, 2011 order. There are no affidavits in support of these motions in the record.

[¶ 9.] A motions hearing was held before Judge Craig A. Pfeifle 4 on July 24, 2012. Judge Pfeifle concluded that Rule 60(b) relief was not appropriate and denied relief. At the hearing, Judge Pfeifle stated:

[W]hile the parties have made some arguments as it relates to factual grounds or reasons to suggest that the application of Rule 60(b) is appropriate, it is going to be my determination that in this particular case the application for Rule 60(b) relief is an effort to change the result which was otherwise unsuccessful at the South Dakota Supreme Court, and I do not believe Rule 60(b) is an avenue to which a party can seek relief if an unfavorable result, including one based upon jurisdictional determinations, is issued by the Supreme Court of South Dakota.

Obviously that's a determination that the Supreme Court will make again, but my determination is going to be that a Rule 60(b) motion at this point in time is not appropriate and the motion will be denied in light of the Supreme Court's opinion dismissing the appeal in this case on the underlying appeal.

Judge Pfeifle entered an order on August 10, 2012, to this effect.

[¶ 10.] The issues in this appeal are:

1. Whether the trial court erred when it determined that a Rule 60(b) motion was not appropriate and denied relief.

2. Whether the trial court erred in denying Appellants relief from Judge Delaney's May 26, 2011 order.

STANDARD OF REVIEW

[¶ 11.] The parties disagree as to the applicable standard of review for this appeal. Arnoldys assert that the appropriate standard of review is abuse of discretion. Corcoran v. McCarthy, 2010 S.D. 7, ¶ 13, 778 N.W.2d 141, 146 (stating that [t]he decision to grant or deny a Rule 60(b) motion rests within the sound discretion of the [trial] court and will not be disturbed on appeal except for an abuse of discretion”). Conversely, RCF argues that Judge Pfeifle determined that he lacked authority to consider a Rule 60(b) motion. Thus, RCF contends that de novo review is appropriate where a Rule 60(b) motion is denied because of a court's perceived lack of authority to consider the motion. Lowry v. McDonnell Douglas Corp., 211 F.3d 457, 460 (8th Cir.2000) (quoting Spinar v. S.D. Bd. of Regents, 796 F.2d 1060, 1062 (8th Cir.1986)) (stating that we review the district court's power to entertain a motion for relief in the first instance de novo”).

[¶ 12.] While we ordinarily review a trial court's decision to grant or deny a Rule 60(b) motion under an abuse of discretion, Judge Pfeifle decided the Rule 60(b) motions as a matter of law based on undisputed facts. Indeed, Appellants' Rule 60(b) motions were not accompanied by any affidavits in support of the motions. Judge Pfeifle recognized that the parties had each made “arguments as it relate[d] to factual grounds or reasons to suggest that the application of Rule 60(b) [was] appropriate[.] Judge Pfeifle, however, determined that “in this particular case[,] the application for Rule 60(b) relief [was] an effort to change the result which was otherwise unsuccessful at the South Dakota Supreme Court and that a Rule 60(b) motion was not appropriate for this purpose. On this basis, Judge Pfeifle denied relief as a matter of law. Thus, we will review his determination under the de novo standard of review. See Rindal v. Sohler, 2003 S.D. 24, ¶ 6, 658 N.W.2d 769, 771 (stating [q]uestions of law are reviewed de novo”).

DECISION

[¶ 13.] In their briefs to this Court regarding the propriety of Judge Pfeifle's Rule 60(b) determination, Appe...

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5 cases
  • In re Estate of Bickel
    • United States
    • South Dakota Supreme Court
    • March 30, 2016
    ...Inc. v. Rock Creek Farms, that a Rule 60(b) motion made on undisputed facts is decided as a matter of law and reviewed de novo. See 2013 S.D. 64, ¶ 12, 836 N.W.2d 631, 636. Here, the question Gail raised via her Rule 60(b) motion is purely legal: Does Eddy's failure to serve notice of the J......
  • Hiller v. Hiller
    • United States
    • South Dakota Supreme Court
    • July 1, 2015
    ...judgment up for review, but only the decision on the request for relief from the judgment under Rule 60(b).” Rabo Agrifinance, Inc. v. Rock Creek Farms, 2013 S.D. 64, ¶ 14, 836 N.W.2d 631, 637 (quoting Lowe, 2006 S.D. 48, ¶ 10, 716 N.W.2d at 779). [¶ 23.] For the first time on appeal, James......
  • In re Estate of Bickel
    • United States
    • South Dakota Supreme Court
    • March 30, 2016
    ...Inc. v. Rock Creek Farms, that a Rule 60(b) motion made on undisputed facts is decided as a matter of law and reviewed de novo. See 2013 S.D. 64, ¶ 12, 836 N.W.2d 631, 636. Here, the question Gail raised via her Rule 60(b) motion is purely legal: Does Eddy's failure to serve notice of the J......
  • P'ship v. Rock Creek Farms
    • United States
    • South Dakota Supreme Court
    • February 19, 2014
    ...in attempt to again address the issues originally raised in Rabo I. The motions were denied and RCF and Finnemans appealed. Our decision in Rabo II affirmed the circuit court's denial of the Rule 60(b) motions. Rabo II, 2013 S.D. 64, ¶ 29, 836 N.W.2d 631, 641. As a result of our decision in......
  • Request a trial to view additional results

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