Adair Holdings, L.L.C., a Nebraska Limited Liability Company v. Roger P. Escher, Mary J. Escher, and Persons in Possession

• Court: Court of Appeals of Iowa
• Decided: February 11, 2015
• Docket: 14-0477
• Status: Published

Opinion

IN THE COURT OF APPEALS OF IOWA

No. 14-0477 Filed February 11, 2015

ADAIR HOLDINGS, L.L.C., A Nebraska Limited Liability Company, Plaintiff-Appellee,

vs.

ROGER P. ESCHER, MARY J. ESCHER, and PERSONS IN POSSESSION, Defendants-Appellants. ________________________________________________________________

Appeal from the Iowa District Court for Washington County, E. Richard

Meadows Jr., Judge.

The defendants appeal from the district court’s ruling in an action to quiet

title. REVERSED AND REMANDED WITH DIRECTIONS.

Dennis J. Mitchell and Sean W. Wandro of Meardon, Sueppel & Downer,

P.L.C., Iowa City, for appellants.

John T. Clendenin and Colin C. Smith of Nyemaster Goode, P.C., Des

Moines, for appellee.

Considered by Danilson, C.J., and Doyle and Tabor, JJ. 2

DANILSON, C.J.

Roger and Mary Escher appeal from the district court’s ruling in an action

to quiet title, initiated by Adair Holdings, L.L.C. The Eschers maintain the

affidavit of service was defective and invalidated the tax deed. They also

maintain the district court abused its discretion by allowing the plaintiff to amend

the pleadings at the commencement of trial. Finally, they contend they are

entitled to equitable relief.

We conclude the scrivener’s error in the notary jurat of the affidavit of

service is not a defect that invalidates the tax deed. However, we determine the

district court abused its discretion in allowing the plaintiff to amend the pleadings.

Accordingly, we find it unnecessary to address the Eschers’ claim for equitable

relief. We reverse and remand with directions to dismiss without prejudice.

I. Background Facts and Proceedings.

The Eschers failed to pay their 2007 property taxes on the land in

question. In June 2009, a non-party, Central Properties, purchased the property

at a tax sale auction, paid the delinquent taxes, and received a tax sale certificate

in return. It held the tax sale certificate on the property for the one year and nine

months, pursuant to Iowa Code section 447.9 (2009).1 The Eschers did not

redeem the property during that period. On January 6, 2012, Central Properties

served a notice of expiration of the right of redemption on the Eschers.

After serving the Eschers with the notice of expiration of the right of

redemption, Central Properties filed an affidavit of service of notice with the

1 The law in effect at the time of the tax sale governs this appeal. See Iowa Code § 447.14. 3

Washington County treasurer on February 10, 2012. It is undisputed the affidavit

included an incorrect date in the jurat, listing the year as 2011 rather than 2012.

The filing of the affidavit of service of notice commenced the final ninety-

day redemption period, pursuant to Iowa Code section 447.12. The Eschers did

not redeem the property during the ninety days.

On May 10, 2012, Central Properties assigned its interest in the tax sale

certificate to Adair Holdings, L.L.C., the plaintiff in this matter. The next day, the

plaintiff obtained a tax deed to the property and recorded it in accordance with

the law.

On July 16, 2012, the plaintiff filed a quiet title action against the Eschers.

The second paragraph of the pleadings contained an incorrect legal description

of the property, describing a totally different parcel of land. The correct legal

description was contained in the attachments to the petition, which included the

tax deed, the tax sale certificate, and the previously served notice of right to

redemption.

The case was tried to the district court on October 8, 2013. At the outset

of the trial, the Eschers moved to dismiss the plaintiff’s petition because of the

incorrect legal description in the pleadings. In response, the plaintiff moved to

amend the petition to correct the legal description, and the district court granted

the motion to amend.

The district court issued its findings of fact, conclusions of law, and ruling

on February 11, 2014. The court ruled in favor of the plaintiff, and the Eschers

appeal. 4

II. Standard of Review.

We review the district court’s ruling in a quiet title action de novo.

Stecklein v. City of Cascade, 639 N.W.2d 335, 336 (Iowa 2005). We give weight

to the district court’s findings, but we are not bound by them. Id.

We review the trial court’s ruling on a motion to amend pleadings for an

abuse of discretion. See Rife v. D.T. Corner, 641 N.W.2d 761, 766 (Iowa 2002).

We will find an abuse of discretion when the court bases its decision on clearly

untenable grounds or to an extent clearly unreasonable. Id.

III. Discussion.

A. Affidavit of Service.

The Eschers maintain the affidavit of service regarding service for the

notice of right of redemption was defective. Specifically, they maintain the notary

portion of the document is incorrectly dated, amounting to a defect that

invalidates the tax deed.

Iowa Code section 447.12 provides, in part, “Service is complete only after

an affidavit has been filed with the county treasurer, showing the making of the

service, the manner of service, the time when and place where made, under

whose direction the service was made, and costs incurred as provided in section

447.13.” This section is “to be strictly construed in favor of the taxpayer.”

Pendergast v. Davenport, 375 N.W.2d 684, 688 (Iowa 1985). If the affidavit of

service “is incomplete or insufficient, the right of redemption is not cut off and no

valid tax deed can be issued.” Id. “[T]he courts are universally inclined to hold

the tax purchaser to a strict compliance with all the statutory provisions by which 5

the right of redemption is to be foreclosed.” Wood v. Yearous, 140 N.W. 362,

364 (Iowa 1913).

However, there is no statutory requirement regarding the jurat of the

affidavit. Here, the affidavit of service correctly stated the making of service, the

manner of service, the time and place where made, under whose direction it was

made, and the costs incurred. Although the affidavit of service is incorrectly

notarized as February 8, 2011, rather than February 8, 2012, the affidavit meets

all of the statutory requirements set forth in section 447.12. The district court

found the scrivener’s error contained in the jurat did not invalidate the tax deed.

We agree. The notary testified that it was a scrivener’s error and the date should

have been February 8, 2012. An error in the date is an amendable defect that

does not render the affidavit void. See Weeks v. Nationwide General Ins. Co.,

500 S.E.2d 620,623 (Ga. Ct. App. 1998); see also Stone v. Miller, 14 N.W. 781,

785 (Iowa 1882) (concluding it was proper to amend affidavits to correct an

omission and clerical error; Dalbey Bros. Lumber Co. v. Crispin, 12 N.W.2d 277,

279 (Iowa 1943) (holding the essential purpose of affidavit is to show the affiant

was sworn by recitals). Because the Eschers do not allege the body of the

affidavit failed to comply with sections 447.12 and 447.13, or that it was sworn,

we find no error.

B. Motion to Amend.

The Eschers also maintain the district court abused its discretion by

granting the plaintiff’s motion to amend the pleadings at the commencement of

the trial. Specifically, the Eschers contend that allowing Adair Holdings to amend

the pleadings to show the correct legal description of the land in question, a 6

different parcel, significantly changed the course of the litigation and substantially

altered their defense strategy. The Eschers also rely upon Iowa Code sections

694.2 and 694.3, which require the premises to be accurately described in the

petition and the notice.

A trial court has considerable discretion in ruling on motions for leave to

amend pleadings. Rife, 641 N.W.2d at 766. Amendments may be allowed at

any time before the case is finally decided, even after completion of the

evidence. Ackerman v. Lauver, 242 N.W.2d 342, 345 (Iowa 1976). “As long as

the amendment does not substantially change the issues or defense of the case,

the court should permit the amendment.” Rife, 641 N.W.2d at 767. In fact,

“[e]ven an amendment that substantially changes the issues may still be allowed

if the opposing party is not prejudiced or unfairly surprised.” Id.

The district court’s written response to the defendants’ resistance to the

plaintiff’s motion to amend stated:

. . . . The issues presented in the case are not substantially changed by the amendment. Although the legal description of the property involved would change, the underlying issues and cause of action would remain the same. Even if the amendment could be regarded as substantially changing the issues of the case, Defendants cannot seriously argue they were prejudiced or unfairly surprised by Plaintiff’s proposed amendment Attached to the Petition were the Tax Deed, the Certification of Purchase from the Washington County tax sale, and the Notice of Expiration of Right of Redemption. Both the Tax Deed and the Notice of Expiration of Right of Redemption contained the correct legal description. Additionally, the Certificate of Purchase from the Washington County tax sale contained a correct abbreviated legal description, the VIN number of the property, and a parcel number particular to the property at issue. Defendants came to trial adequately prepared to dispute Plaintiff’s claim to the property bearing the correct legal description. In fact, all evidence presented at trial, from both sides, relates to the real property with the proper legal description. No evidence 7

was presented relating to the real property with the legal description listed in paragraph two of Plaintiff’s Complaint. Further, Defendants did not ask for additional time to prepare due to surprise or prejudice, or even argue that they were surprised. CF. Ackerman, 242 N.W.2d at 345 (finding that trial court did not abuse its discretion in granting leave to amend where party claiming surprise and lack of opportunity to defend because of proposed amendment did not ask for a continuance to eliminate those problems.)

After reviewing the record, we disagree. We believe a quiet title action

that references the wrong parcel of land as opposed to a minor correction or

typographical error, substantially changes the issues in such a proceeding. We

think the pleading and notice were deficient to the extent the motion should have

been denied.

First, we are not convinced a motion to amend alleviates the failure to give

notice of the action containing an accurate description of the property. See Iowa

Code § 649.3 (“The notice in such action shall accurately describe the property,

and, in general terms, the nature and extent of the plaintiff’s claims, and shall be

served as in other cases.”). We assume our legislature intended to require

ample notice to a defendant facing a quiet title action involving his or her real

estate interests or claims by specifically reciting what should be in the notice.

Here, the notice to quit recites the wrong description, and the original notice fails

to include any of the requirements of section 649.3.

Secondly, our supreme court has noted that although a particular property

description is generally not required in a petition, a statute may require it.

Hagenson v. United Tel. Co. of Iowa., 164 N.W.2d 853, 858 (Iowa 1969)

(concluding a petition alleging trespass was not fatally descriptive for failing to

reasonably describe the property). Here, section 649.2 requires a description “as 8

accurately as may be.” “[A] description is bad which is uncertain, erroneous, or

misleading.” Hangenson, 164 N.W.2d at 858. The petition filed in this action

was both erroneous and misleading because the petition and its attachments

referenced two different parcels.

Third, we are not convinced that Adair Holdings was entitled to move to

amend the petition particularly where it admits the legal description was in error.

It is axiomatic and fundamental law that the “plaintiffs must secure a decree

quieting their title on the strength of their own title and not on the weakness of the

adversary.” Reutter v. Middlebrook, 131 N.W.2d 817, 820 (Iowa 1964). Further,

Iowa Code section 649.1 states that a quiet title action “may be brought by

anyone whether in or out of possession, having or claiming interest therein.”

(emphasis added). Thus, the plaintiff must claim an interest in the property

identified in the petition and, to succeed, must rely on the strength of their own

title. Where the wrong parcel is described in a quiet title petition, did Adair

Holdings even have an interest in the property identified in the petition? If Adair

Holdings did not have any interest in the property identified in the petition and

upon which this action was initiated, how may we say they are entitled to amend

the petition? Again, we may reach a different result if the description error was

insubstantial or simply a minor typographical error.

We conclude, because this was a quiet title action and the petition

described the wrong parcel of land, the issues were substantially changed.

Moreover, the notice did not comply with Iowa Code section 649.3. Under these

facts and for the reasons given, we are unable to conclude the motion to amend

was properly granted because of lack of prejudice, unfair surprise, or the failure 9

to seek a continuance. Accordingly, we conclude the district court abused its

discretion in granting the plaintiff’s motion to amend.

IV. Conclusion.

We find the scrivener’s error in the notary jurat of the affidavit of service is

not a defect which invalidates the tax deed, but the district court abused its

discretion in allowing the plaintiff to amend the pleadings. Accordingly, we need

not address the Eschers’ claim for equitable relief. We remand with directions to

the district court to enter an order in compliance with this ruling and granting the

Eschers’ motion to dismiss. However, the dismissal shall be without prejudice.

Costs shall be assessed to the plaintiff.

REVERSED AND REMANDED WITH DIRECTIONS.