915 N.W.2d 664
N.D.2018Background
- Johnston Land Company sought to purchase property in Grand Forks that had been associated with attorney John E. Widdel Jr., who was ordered to refund $95,000 in attorney fees in prior litigation (Estate of Amundson).
- During fee litigation, attorney Sara K. Sorenson (for the beneficiaries) recorded an affidavit in Grand Forks County stating a particular parcel "may be pursued to satisfy the Judgment." The affidavit did not name the current owner, state a dollar amount, or explicitly assert a lien.
- Johnston filed a petition seeking (among other relief) a declaration that Sorenson’s affidavit is a nonconsensual common-law lien, a declaratory judgment striking the affidavit from the county records, damages, and fees.
- The district court ruled only that the affidavit was not a nonconsensual common-law lien, characterizing it as akin to a lis pendens, and declined to rule on Johnston’s other claims.
- Johnston appealed the limited ruling; the Supreme Court affirmed the lien determination but reversed and remanded for the district court to address Johnston’s remaining claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Sorenson’s recorded affidavit constitutes a nonconsensual common-law lien under N.D.C.C. § 35-35-01 | The affidavit operates as a nonconsensual common-law lien or notice that clouds title and inhibits alienability | The affidavit is merely notice akin to a lis pendens and does not create a lien or interest in the property | The affidavit is not a nonconsensual common-law lien; it does not claim an interest, state an amount, or purport to be a lien |
| Whether Johnston has a justiciable controversy to appeal after the district court’s lien ruling | Johnston contends remaining recordation creates a live controversy and potential harm to title searches and transactions | Sorenson contends the district court’s ruling removes legal effect and moots controversy | Court held a live controversy remains because the affidavit remains of record and could affect title searches; appeal not dismissed |
| Whether the district court abused discretion by not ruling on Johnston’s other requested relief (declaratory judgment, damages, fees) | Johnston argues the court should have adjudicated items c–g in its petition (striking affidavit, damages, attorney fees) | Sorenson did not directly contest jurisdiction to adjudicate other claims once lien issue decided | Court reversed in part and remanded for district court to rule on Johnston’s remaining claims |
| Proper characterization of the affidavit (lis pendens vs. lien) | Johnston: affidavit functions as a lien-like cloud on title | Sorenson: affidavit is notice only, like a lis pendens, and does not create a lien | Court agreed with characterization as notice akin to lis pendens, not a lien |
Key Cases Cited
- Estate of Amundson v. Widdel, 870 N.W.2d 208 (N.D. 2015) (background judgment for beneficiaries and prior litigation over attorney fees)
- McKenzie County v. Casady, 214 N.W. 461 (N.D. 1927) (a recorded notice of lis pendens does not, by itself, create a lien or interest in property)
- Nusviken v. Johnston, 890 N.W.2d 8 (N.D. 2017) (contrast of instrument asserting an attorney lien sufficient to meet nonconsensual lien criteria)
- State ex rel. Emps. of State Penitentiary v. Jensen, 331 N.W.2d 42 (N.D. 1983) (discusses how unwarranted clouds on title can inhibit alienability and cause difficult-to-quantify damages)