Waxler v. Dalsted

• Decision Date: 28 February 1995
• Docket Number: No. 940266,940266
• Citation: 529 N.W.2d 176
• Parties: William C. WAXLER, Loren R. Waxler and Gregory J. Waxler, Plaintiffs and Appellants, v. Kenneth L. DALSTED, personal representative of the Estate of Loren M. Waxler, deceased, Lorraine A. Waxler, and all persons unknown claiming any estate or interest in or lien or encumbrance upon the property described in the Complaint, 1 Defendants and Appellees. Civ.
• Court: North Dakota Supreme Court

Page 176

529 N.W.2d 176

William C. WAXLER, Loren R. Waxler and Gregory J. Waxler Plaintiffs and Appellants, v. Kenneth L. DALSTED, personal representative of the Estate of Loren M. Waxler, deceased, Lorraine A. Waxler, and all persons unknown claiming any estate or interest in or lien or encumbrance upon the property described in the Complaint,¹ Defendants and Appellees.

Civ. No. 940266.

Supreme Court of North Dakota.

Feb. 28, 1995.

Mervin D. Nordeng (argued), Wegner, Fraase, Nordeng, Johnson & Ramstad, Fargo, for plaintiffs and appellants.

Kenneth L. Dalsted (argued), Gilje & Dalsted, Jamestown, for defendants and appellees.

NEUMANN, Justice.

William C. Waxler, Loren R. Waxler, and Gregory J. Waxler (Waxler sons) appealed a district court summary judgment quieting title to certain real estate in Loren M. Waxler and Lorraine Waxler. We reverse and remand for further proceedings.

Loren M. and Harriet M. Waxler were divorced in 1964. Harriet was awarded custody of the Waxler sons. At the time of their divorce, Harriet and Loren M. owned two quarter sections of farmland, less a 40-acre parcel previously sold. They stipulated how the land was to be distributed and their agreement was incorporated into the following provision of the divorce decree:

"[T]he net income derived from this property, after all normal business expenses are deducted, shall be used as an aid to the college education fund necessary for the children of the Parties herein and all net funds so derived shall be set aside for that purpose. [Loren M.] shall assume the responsibility of providing funds for the college education for the children of the Parties herein and during said period of college, [Harriet] will not receive any income from said premises, and that as of this date the income from said premises shall be saved for college for the children of the Parties herein by [Loren M.].

"At the time the last child completes college or graduate school, or is no longer attending college, these premises shall be divided with one-quarter Section going to [Harriet] and one-quarter Section going to [Loren M.] and that if no agreement can be made on which quarter shall go to whom, the said property shall be sold and the proceeds be divided evenly between the Parties."

Loren M. Waxler and Lorraine were married in 1965. Harriet died in 1970. The attorney representing the administrator sent a letter to Loren M., advising him that, as to the farmland, "[u]nder the laws of joint tenancy, you as the survivor automatically inherit the undivided interest owned by your ex-wife." The final decree of distribution of Harriet's estate noted that an undivided one-half interest in the farmland "is vested in Loren M. Waxler pursuant to the laws pertaining to property held in joint tenancy." In 1991, Loren M. conveyed to Lorraine a joint tenancy interest in the farmland.

The Waxler sons filed suit against Loren M. and Lorraine in 1992. The complaint sought to have title to an undivided one-half interest in the farmland (W 1/2 of Section 17, Township 137, Range 64) quieted in the Waxler sons; the farmland partitioned and the Waxler sons awarded the NW 1/4 of Section 17; the farmland declared to be subject to a trust and that they be granted an accounting of the proceeds of the trust created in their parents' divorce judgment, and judgment for the amount due shown by the accounting. The Waxler sons moved for summary judgment. The district court denied the motion and, instead, ordered summary judgment quieting title to the farmland in Loren M. and Lorraine as joint tenants, declaring that the Waxler sons had no interest in the farmland, and declaring that Loren M. was entitled to all proceeds of the farmland free of any claims of his sons.

The dispositive issue is whether or not the 1964 stipulation of Harriet and Loren M. about the disposition of their farmland or their 1964 divorce judgment severed their joint tenancy ownership of the farmland. We hold that the joint tenancy was severed.

This case is governed by Renz v. Renz, 256 N.W.2d 883 (N.D.1977). When Ernest and Mary Lou Renz were divorced in 1962, they stipulated that certain property held in joint tenancy was " 'to be divided equally, less any incumbrance that is against said property as soon as property is sold.' " Id. at 884. The stipulation was made a part of the judgment. This court held that the Renz's joint tenancy ownership of the property had been severed and a tenancy in common created, for two reasons: (1) "[T]he parties voluntarily severed the joint-tenancy relationship, and thereby created in themselves a tenancy in common" [id. at 886]; and (2) " '[I]n a divorce proceeding where there is a final disposition of jointly held property, such a decree effectuates a severance of the joint tenancy unless the decree specifically declares that the parties shall continue to hold the property as joint tenants instead of as tenants in common.' " Id. at 886, quoting Snyder v. Snyder, 298 Minn. 43, 50, 212 N.W.2d 869, 874 (1973). Here, as in Renz, Harriet and Loren M. voluntarily severed their joint tenancy ownership of their farmland and created a tenancy in common by their property settlement agreement in conjunction with their divorce. Also, as in Renz, the Waxler divorce decree finally disposed of their jointly held property and severed their joint tenancy ownership of the farmland because it did not specifically declare that the parties would continue to hold the property as joint tenants instead of as tenants in common. Therefore, from the time of their divorce in 1964, Harriet and Loren M. owned the farmland as tenants in common and Harriet's interest did not pass to Loren M. upon her death.

The district court held that Renz should be applied prospectively only, and not retroactively, so that Renz was inapplicable to the Waxler divorce judgment and property distribution agreement. The court erred in failing to apply Renz.

"As a rule, judicial decisions apply 'retroactively.' Indeed, a legal system based on precedent has a built-in presumption of retroactivity." Solem v. Stumes, 465 U.S. 638, 642, 104 S.Ct. 1338, 1341, 79...