Dixon v. Dixon
2017 ND 174
N.D.2017Background
- Shirley A. Dixon and her husband William created a trust (Shirley A. Dixon Revocable Trust) providing that trust property would be allocated equally among their four children; the couple transferred a McKenzie County tract (Section 31) into the trust.
- In 1996 William, as trustee, executed a warranty deed granting John Dixon a life estate in Section 31, with remainder to John’s children (or, if none, to the three daughters). The deed also stated it "excepted and reserved all prior mineral conveyances, reservations and easements of record."
- In 2000 William asked John to sign a mineral deed conveying an undivided three‑fourths mineral interest (stated as intent to convey 1/4 to each sibling) from John to the three siblings; John signed. The siblings and parents believed this conveyed fee simple mineral ownership equally.
- Billie Dixon (successor trustee) sued in 2013 seeking reformation/quiet title, alleging William intended to reserve minerals to the trust and did not intend to convey minerals outright to John in 1996; district court held a mutual mistake occurred and reformed the 1996 warranty deed to except and reserve the minerals to the trust.
- The district court found the 2000 mineral deed did not correct the mistake because John only held a life estate and thus could not transfer fee simple minerals; parties didn’t realize royalty consequences until later.
- John appealed, arguing (1) no mutual mistake supported reformation, (2) latent ambiguity/extrinsic evidence were improperly applied, (3) the statute of limitations barred reformation, and (4) the trial should have been continued or dismissed for failure to join the child’s successor conservator.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 1996 deed should be reformed for mutual mistake | Billie: deed didn’t reflect parties’ intent; parents intended minerals retained by trust and split equally among children | John: gift of property to him and equivalent cash to siblings means no mutual mistake; he didn’t know or suspect a mistake | Reformation affirmed: district court’s factual finding of mutual mistake supported by clear and convincing evidence and not clearly erroneous |
| Use of extrinsic evidence / latent ambiguity | Billie: extrinsic evidence admissible to show mutual mistake and correct instrument | John: deeds unambiguous; latent ambiguity finding was error so extrinsic evidence should not control | Court: deed unambiguous on face but extrinsic evidence admissible for reformation; district court erred in calling it a latent ambiguity but nonetheless properly relied on extrinsic evidence to find mutual mistake |
| Statute of limitations for reformation claim | Billie: issue not preserved for appeal; trial court didn’t rule timing of accrual and defendants failed to develop record | John: ten‑year limitations period under N.D.C.C. § 28‑01‑15(2) began in Dec 2000 when mistake was discovered | Held: statute‑of‑limitations argument was inadequately presented below and thus waived on appeal; court did not decide accrual question |
| Joinder/substitution of successor conservator (indispensable party) | Billie: suit was against John individually and as conservator; Rule 25 allows continuation against original party and substitution is discretionary and untimely here | John: child’s successor conservator appointed earlier was not joined, making trial procedurally deficient | Held: district court did not abuse discretion; motion was untimely and Rule 25 permits continuation against original party with judgment binding on successor in interest |
Key Cases Cited
- Freidig v. Weed, 868 N.W.2d 546 (N.D. 2015) (burden and standard for reformation; extrinsic evidence admissible to prove mutual mistake)
- Goodall v. Monson, 893 N.W.2d 774 (N.D. 2017) (latent ambiguity doctrine and admissibility of extrinsic evidence)
- Mau v. Schwan, 460 N.W.2d 131 (N.D. 1990) (reformation claims depend on factual showing; insufficiency of evidence can defeat reformation)
- KLE Constr., LLC v. Twalker Dev., LLC, 887 N.W.2d 536 (N.D. 2016) (standards for appellate review of bench trial findings; preservation of issues for appeal)
- Pamida, Inc. v. Meide, 526 N.W.2d 487 (N.D. 1995) (definition and examples of latent ambiguity)
- N.D. Mineral Interests, Inc. v. Berger, 509 N.W.2d 251 (N.D. 1993) (Rule 25 substitution; continuation against original party and binding effect on successor in interest)