Interest of Hoff
2013 ND 68
| N.D. | 2013Background
- Gundersons owned real property in Mountrail County and had an oil and gas lease with Holt recorded 2004; Holt assigned most interests to Murex and related entities in 2005; Creighton, through his agent Bradshaw, sought to lease the same minerals to Gundersons in 2007; Holt filed an affidavit in 2007 asserting a typographical error in the lease description; Creighton executed a lease with Gundersons in 2007 (recorded 2008) and later assigned to Antares and then Northern; Northern sued to quiet title in 2009 and sought to reform Holt’s lease under N.D.C.C. § 32-04-17; district court reformed Holt’s lease and quieted title in Murex, then this appeal ensued urging misapplication of good faith purchaser law and notice rules; the Supreme Court reversed and remanded for factual determinations on notice and good faith purchaser status
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Creighton was a good faith purchaser without notice | Northern contends Creighton lacked good faith due to constructive notice | Murex contends Creighton had notice or inquiry responsibility precluding good faith status | Dispute of fact on notice precludes summary judgment on good faith status |
| Whether reformation was proper given good faith third parties | Northern argues reformation would prejudice Northern’s rights | Murex argues reformation allowed if third parties act in good faith for value | Remanded to resolve factual questions on good faith, notice, and value to third parties |
| Whether the district court should have granted summary judgment on notice-related issues | Northern seeks judgment as a matter of law | Murex seeks determination based on undisputed facts | Summary judgment improper where reasonable inferences require trial-developed findings |
Key Cases Cited
- Diocese of Bismarck Trust v. Ramada, Inc., 553 N.W.2d 760 (N.D. 1996) (constructive notice and inquiry standard for notice of interests)
- Smetana v. Farmers Union Oil Co., 764 N.W.2d 665 (N.D. 2009) (good faith purchaser without notice; factual disputes require trial)
- Riedlinger v. Steam Bros., Inc., 826 N.W.2d 340 (N.D. 2013) (summary judgment review de novo; facts viewed in opposing party’s favor)
- Ehlen v. Melvin, 823 N.W.2d 780 (N.D. 2012) (contract formation timing; enforceability hinges on contract existence)
- Burris Carpet Plus, Inc. v. Burris, 785 N.W.2d 164 (N.D. 2010) (summary judgment standards; credibility and inferences not weighed at SJ)
- Nygaard v. Robinson, 341 N.W.2d 349 (N.D. 1983) (inferential determination of facts; some inferences require trial)