Dorothy J. Pierce Family Mineral Trust v. Jorgenson
2012 ND 100
| N.D. | 2012Background
- Derivative action by Limited Partners on behalf of Magic Partnership against Magic Corporation, B K Properties, Herslip Construction, and Kenneth Herslip.
- Limited Partners sought removal of Magic Corporation as general partner and damages for fiduciary breaches, plus piercing of corporate veils and punitive damages.
- District court removed Magic Corporation as general partner, awarded damages against Magic Corporation, Herslip Construction, and B K Properties, and denied piercing the veil and punitive damages.
- Court denied punitive damages due to discretion and absence of justification for exemplary damages.
- Court denied piercing the corporate veil, stating plaintiffs failed to prove the necessary elements under Coughlin and related standards.
- May 2010 amended judgment awarded damages and costs; no party appealed; later, Limited Partners sought post-judgment relief for veil piercing and punitive damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Authority to grant post-judgment veil piercing and punitive damages | Limited Partners seek piercing and punitive relief after judgment | District court lacked authority to reopen judgment for these issues | Denied; reopening required under Rule 59/60 |
| Whether post-judgment motion reopens final judgment under Rule 59/60 | Motion pursued relief outside Rule 59/60, but concerns re-opening judgment | Relief should follow Rule 59/60 procedures or an appeal | Held that post-judgment relief requires timely Rule 59/60 motion; district court did not err in denial |
| Role of ND law ch. 13-02.1 in post-judgment relief | Act provides authority to address fraudulent transfers and related remedies | Remedies not applicable to veil piercing or punitive damages in this posture | Remedies under ch. 13-02.1 do not authorize post-judgment veil piercing or punitive damages in this case |
| Effect of bankruptcy stays on post-judgment relief | Bankruptcy proceedings may permit relief outside automatic stay | Automatic stay may apply to related relief actions | Unnecessary to decide; the court affirmed dismissal without addressing stay issues |
Key Cases Cited
- Axtmann v. Chillemi, 740 N.W.2d 838 (2007 ND) (procedural distinctions; post-judgment veil piercing not in same action as judgment)
- Coughlin Constr. Co. v. Nu-Tec Indus., Inc., 755 N.W.2d 867 (2008 ND) (veil piercing requires showing injustice or fundamental unfairness; burden on plaintiff)
- Hamilton v. Hamilton, 410 N.W.2d 508 (1987 ND) (equitable relief from judgment; not applicable to post-judgment veil piercing here)
- Jablonsky v. Klemm, 377 N.W.2d 560 (1985 ND) (veil piercing considerations; precedents cited in analysis)
- Carlson v. Carlson, 802 N.W.2d 436 (2011 ND) (fraudulent transfers; interpretation of Uniform Fraudulent Transfer Act)
- Nerland Oil, Inc. v. Nerland, 620 N.W.2d 159 (2000 ND) (automatic stay applicability to non-debtor co-defendants in unusual circumstances)
- Production Credit Ass’n v. Klein, 385 N.W.2d 485 (1986 ND) (automatic stay limitations; co-defendants distinction)