Blue Canyon Well Ass'n v. Jevne
410 P.3d 251
| N.M. Ct. App. | 2017Background
- Owners of properties sharing a well had an unrecorded well-sharing and easement Agreement; a group calling themselves "Blue Canyon Well Association" (Blue Canyon) was formed to manage the well.
- Blue Canyon sued neighbor Denise Jevne in magistrate court for unpaid well expenses; the complaint was signed by individual members identifying Blue Canyon.
- Magistrate court awarded damages and attorneys’ fees to Blue Canyon; Jevne appealed to district court.
- Movants (the individuals who signed the complaint) sought to amend the caption to substitute themselves for Blue Canyon, admitting no formal entity called "Blue Canyon Well Association" had been filed under NMSA 1978 § 53-10-1.
- The district court concluded the statute’s use of “may” made filing permissive, held Blue Canyon was an unincorporated association with capacity to sue, and entered judgment for Blue Canyon; Jevne appealed.
- The Court of Appeals considered whether statutory filing under § 53-10-1 is mandatory and whether common-law associations (unfiled) have capacity to sue.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 53-10-1 requires filing of statutory documents to form an unincorporated association | Filing is permissive because statute uses "may"; filing not required to form an association | Filing is mandatory; without filing no statutory association exists and it lacks capacity to sue | Filing is mandatory; § 53-10-1 requires the specified filing to create a statutory unincorporated association |
| Whether a common-law (unfiled) unincorporated association has capacity to sue | Common-law associations exist and § 53-10-6 grants the right to sue to all unincorporated associations (statutory or common law) | Precedent holds unincorporated associations have no legal existence unless recognized by statute; unfiled groups lack capacity | Common-law/unfiled associations have no legal existence or capacity to sue; only associations formed under § 53-10-1 may sue in the association’s name |
| Effect of failure to comply with § 53-10-1 on existing judgment | Blue Canyon contended judgment is valid despite lack of recorded filing | Jevne argued judgment is invalid because entered for a non-existent entity | Judgment in favor of Blue Canyon must be vacated because Blue Canyon lacked capacity to sue |
| Whether court must reach whether Blue Canyon was real party in interest | Blue Canyon urged merits and real-party-in-interest issues | Jevne argued real-party-in-interest problems exist; lack of capacity dispositive | Court did not reach real-party-in-interest because lack of capacity to sue was dispositive |
Key Cases Cited
- Flanagan v. Benvie, 273 P.2d 381 (N.M. 1954) (unincorporated associations, clubs, and societies have no legal existence absent statutory recognition)
- State ex rel. Overton v. N.M. Tax Comm’n, 462 P.2d 613 (N.M. 1969) (common-law association lacked legal existence and right to sue absent statutory formation or class representative procedure)
- Moongate Water Co. v. City of Las Cruces, 302 P.3d 405 (N.M. 2013) (statutory interpretation reviewed de novo; text is primary source of meaning)
- Baker v. Hedstrom, 309 P.3d 1047 (N.M. 2013) (statutes should be interpreted to avoid rendering language superfluous)
- State ex rel. E. N.M. Univ. Regents v. Baca, 189 P.3d 663 (N.M. 2008) (declining to read statutes permissively where that would render provisions superfluous)