Schwab v. Zajac

823 N.W.2d 737

2012 ND 239

Greg SCHWAB and Shelly Schwab, Plaintiffs and Appellees

v.Raymond ZAJAC, Defendant and Appellant.

No. 20120172.

Supreme Court of North Dakota.

Nov. 27, 2012.

Mark R. Western, Fargo, N.D., for plaintiffs and appellees.

Raymond Zajac, self-represented, Lidgerwood, N.D., defendant and appellant.

CROTHERS Justice.

[¶ 1] In an action stemming from a failed sale of land from Greg and Shelly Schwab to Raymond Zajac, Zajac appeals from a judgment entered after a jury awarded the Schwabs $4,000 on their slander of title claim against Zajac, the district court ordered disbursement of Zajac's payment of $10,000 in earnest money to the Schwabs and the court ordered Zajac to execute a document disclaiming any interest in the Schwabs' land. Zajac argues the district court erred in not admitting evidence at trial involving the Schwabs' attempt to cure a waterfowl easement on the land as an accommodation to complete the transaction, the court erred in not admitting evidence at trial of the present value of the Schwabs' land and denying him due process and a fair trial by taking over Zajac's self-represented case. We affirm the judgment and remand to the district court to determine the Schwabs' attorney fees on appeal for their slander of title claim.

I

[¶ 2] In August 2008, Zajac executed a purchase agreement to purchase a tract of land in Ransom County from the Schwabs for $196,000, with $10,000 as an earnest money payment made to an escrow agent. The purchase agreement provided for a closing date before November 12, 2008 and required the Schwabs to convey marketable title by warranty deed to Zajac “subject only to easements and reservations of record.” The purchase agreement stated that “[i]f the Seller shall meet all of the obligations imposed upon the Seller by this Offer to Purchase and the Buyer for any reason fails, neglects, or refuses to purchase the property within ten (10) days after fulfillment of the Seller's obligations, then at the Seller's option the earnest money ... shall be retained by the Seller as liquidated damages.” The purchase agreement provided Zajac with a seller's property disclosure statement as an “addenda” that was “part of the Purchase Agreement,” in which the Schwabs answered “no” to a question whether they were “aware if the property contains any U.S. Fish or Wildlife easement(s).” According to Greg Schwab, the Schwabs prepared the disclosure statement after receiving it from real estate agent Dale Haugen, who approached them about selling the land. The disclosure statement said the “disclosed information is given to the best of the seller's knowledge. This is not a warranty or guaranty of any kind by the seller(s) or any licensee(s) representing or assisting any party in the transaction(s). Information presented in this form is not intended to be part of any contract between buyer(s) and seller(s).”

[¶ 3] Zajac's attorney's subsequent review of the abstract of title for the land disclosed a United States Fish and Wildlife waterfowl easement, which was an easement of record on the property. Zajac refused to complete the purchase of the land on the designated closing date. According to Zajac, he agreed to complete the purchase if the Schwabs had the waterfowl easement removed and the Schwabs thereafter attempted to terminate the easement. On January 5, 2009, Zajac recorded an affidavit of interest in the land with the Ransom County Recorder of Deeds, which stated:

“4. Upon receiving a title opinion, I realized that the seller had misrepresented the property in the purchase agreement since there was a government waterfowl easement on the entire quarter and the property was represented as not having a government easement.

“5. The seller through their attorney offered to try to correct the misrepresentation by attempting to have the government waterfowl easement terminated. I through my attorney was agreeable to completing the purchase with the termination of the government waterfowl easement. Previously and continually I have and do request the return of my earnest money because of the misrepresentation. As of the date of this affidavit, the seller has not returned my earnest money, corrected the misrepresentation, or paid me damages caused by the misrepresentation.”

[¶ 4] The Schwabs sued Zajac for the earnest money for breach of the purchase agreement, for a determination that Zajac's recorded affidavit of interest in the land was null and void, to quiet title to the land and for special damages for slander of title stemming from Zajac's recorded affidavit of interest in the land. The Schwabs' complaint sought attorney fees and costs under N.D.C.C. § 47–19.1–09.

[¶ 5] Zajac filed an answer and counterclaim for fraud, claiming the Schwabs fraudulently failed to disclose the wildlife easement, which decreased the value of the land by at least $30,000 and induced him to execute the purchase agreement. He alleged he sought the return of his earnest money and the parties subsequently agreed Zajac would purchase the land after the Schwabs had the wildlife easement removed. He claimed he gave the Schwabs time to remove the easement and he filed the affidavit of interest with the Ransom County Recorder of Deeds in January 2009 to protect his interest in the land. Zajac sought return of his earnest money.

[¶ 6] Zajac represented himself during a jury trial. A jury returned a special verdict, finding Zajac failed to prove the Schwabs committed fraud in failing to disclose the waterfowl easement. The jury also found Zajac was liable for slander of title, which caused the Schwabs $4,000 in damages. The district court ordered Zajac to execute a document disclaiming any interest in the Schwabs' land and ordered disbursement of the $10,000 earnest money payment from the escrow agent to the Schwabs. The earnest money was disbursed to the Schwabs, and Zajac executed a document disclaiming any interest in the Schwabs' land. The court thereafter awarded the Schwabs' attorney fees and costs of $7,642 incurred in the trial court for the slander of title claim.

II

[¶ 7] The Schwabs argue Zajac's appeal is limited to the parts of the judgment that have not been satisfied. Zajac responds the judgment has not been satisfied because he did not voluntarily acquiesce or have any control over the disbursement to the Schwabs of the $10,000 earnest money payment held by the escrow agent and because he has not paid the damages for the slander of title claim.

[¶ 8] “We will dismiss an appeal if the issues become moot or academic and no actual controversy is left to be determined.” Ramsey Fin. Corp. v. Haugland, 2006 ND 167, ¶ 8, 719 N.W.2d 346. “An actual controversy no longer exists when the issue has been rendered moot by a lapse of time, or the occurrence of related events which make it impossible for a court to grant effective relief.” Id. “[A] party who voluntarily pays a judgment against him waives the right to appeal from the judgment.” Id. at ¶ 9. “[V]oluntary acquiescence in a judgment also constitutes a waiver of the right to appeal.” Id. “[P]ayment or acquiescence under coercion or duress does not constitute a waiver.” Id. at ¶ 10. “[W]hether a judgment has been voluntarily paid depends upon the facts and circumstances of each particular case, and the party seeking dismissal of the appeal bears the burden of showing the judgment was paid voluntarily.” Mr. G's Turtle Mountain Lodge, Inc. v. Roland Twp., 2002 ND 140, ¶ 13, 651 N.W.2d 625. “A showing that the judgment has been paid, however, creates a presumption that the payment was voluntary.” Id.

[¶ 9] Here, a third party escrow agent disbursed the earnest money to the Schwabs, and the court ordered Zajac to execute a document disclaiming any interest in the Schwabs' land. However, the money judgment for the Schwabs' slander of title claim has not been paid. The issues raised by Zajac on appeal involve evidentiary issues and a claimed denial of due process and a fair trial. Those issues involve trial of the Schwabs' slander of title claim, which has not been satisfied, and the damages for that claim. On the record of the proceedings and the relationship of the issues on appeal to the unsatisfied claim, we conclude Zajac has not waived his right to appeal from the judgment.

III

[¶ 10] Zajac argues the district court erred in refusing to admit evidence about the Schwabs' attempt to cure the waterfowl easement as an accommodation to complete the land sale. He argues the court initially indicated it would allow evidence of the Schwabs' attempt to remove the waterfowl easement but later ruled the evidence was not relevant. He claims the court's initial ruling opened the door for admission of the evidence about the parties' negotiations, which he contends is relevant to his claim the Schwabs negligently misrepresented no waterfowl easement on the land existed.

[¶ 11] The Schwabs made a pretrial motion to preclude Zajac from introducing evidence about settlement negotiations or injecting issues of settlement at trial. At a pretrial conference, the court ultimately ruled it would exclude evidence of the Schwabs' attempts to eliminate the waterfowl easement after the following colloquy:

“MR. WESTERN: If Mr. Zajac wants to introduce testimony that we attempted to have the [easement] removed, I don't care. If he wants to, if he wants to speak to that, that's fine. But any other back and forth in terms of the negotiations, I think is inappropriate. I guess Mr. Zajac's affidavit of interest in real estate does state that there was an attempt to do this. We can explain why that was done and leave that at that. I don't—I just—

THE COURT: All right. I think that's a fair accommodation.

MR. ZAJAC: State law says you have 60 days to cure the title. It was over 60 days when this was done.

THE COURT: But Mr. Zajac, your argument assumes a fact that has not been proven, that this was an unmarketable title.

MR. ZAJAC: No. I—Okay.

THE COURT:...