Larry Grimlie, Linda Grimlie v. AgStar Financial Services, FLCA
A16-877
| Minn. Ct. App. | Dec 27, 2016Background
- Larry and Linda Grimlie owned an 80-acre parcel in Wright County; their 5-acre homestead was not formally split from the rest of the land.
- In 2002 AgStar made a mortgage secured by 75 acres (excluding the homestead).
- Larry filed Chapter 7 bankruptcy in 2004 and listed the AgStar debt; AgStar filed a proof of claim; discharge occurred in 2012.
- AgStar foreclosed by advertisement in 2013 (after an earlier defective notice); sheriff’s sale occurred August 21, 2013; one-year redemption lapsed August 21, 2014 and Grimlies did not redeem.
- After foreclosure AgStar obtained separate parcel IDs to create a 70-acre tract and a 5-acre homestead tract to comply with county zoning; AgStar sought eviction of the Grimlies from the 70-acre tract and offered to transfer the 5-acre parcel to the Grimlies (they refused).
- The district court denied the Grimlies’ temporary-injunction motion and granted AgStar’s motion to dismiss (treated as summary judgment) dismissing the Grimlies’ complaint; Grimlies appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Farmer-Lender Mediation Act (FLMA) applies | Grimlie: FLMA applies; AgStar failed to show his farm income was < $20,000 | AgStar: FLMA is inapplicable because the debt was listed in bankruptcy and AgStar filed a proof of claim (statutory exclusion) | Court: FLMA does not apply because the statute excludes debts scheduled in bankruptcy or with a proof of claim; summary judgment for AgStar |
| Whether AgStar failed to comply with foreclosure-by-advertisement technical statutory requirements (notice provisions in §§ 580.021 and 582.043) | Grimlie: Foreclosure defective because AgStar did not follow notice/loss-mitigation rules applicable to owner‑occupied residential property | AgStar: Those statutory notice provisions apply only to owner‑occupied residential properties up to four units; the mortgage covered agricultural acreage excluding the homestead | Court: These provisions do not apply to non‑residential agricultural land described in the mortgage; summary judgment for AgStar |
| Whether Grimlie may raise failure-to-comply with Minn. Stat. § 582.039 on appeal | Grimlie: Argues § 582.039 noncompliance | AgStar: Issue was not pleaded or argued below | Court: Issue not raised in district court may not be raised for first time on appeal; forfeited |
Key Cases Cited
- Larson v. Northwestern Mutual Life Insurance Co., 855 N.W.2d 293 (Minn. 2014) (standard of review for summary judgment)
- Fontaine v. Steen, 759 N.W.2d 672 (Minn. App. 2009) (issues not raised below ordinarily cannot be raised on appeal)
- Bailey v. Galpin, 41 N.W. 1054 (Minn. 1889) (land description controlling when it identifies the intended parcel)
- Rochat v. Emmett, 29 N.W. 147 (Minn. 1886) (deed description may convey title if it identifies land with certainty)
- Grimlie v. Georgen-Running, 439 B.R. 710 (Bankr. D. Minn. 2010) (bankruptcy proceedings and related fraudulent-transfer allegations relevant to Grimlie’s extended bankruptcy)