Lundgren v. Upper Skagit Indian Tribe

389 P.3d 569, 187 Wash. 2d 857

Opinions

[As amended by order of the Supreme Court June 8, 2017.]

Johnson, J.

¶1 This case involves the relationship between in rem jurisdiction, Superior Court Civil Rule (CR) 19, and sovereign immunity. The issue is whether the Upper Skagit Indian Tribe’s (Tribe) assertion of sovereign immunity requires dismissal of an in rem adverse possession action to quiet title to a disputed strip of land on the boundary of property purchased by the Tribe. The superior court concluded that because it had in rem jurisdiction, it could determine ownership of the land without the Tribe’s participation. An inquiry under CR 19, as required by our cases, involves a merit-based determination that some interest will be adversely affected in the litigation. Where no interest is found to exist, especially in an in rem proceeding, nonjoinder presents no jurisdictional barriers. We find that the Tribe does not have an interest in the disputed property; therefore, the Tribe’s sovereign immunity is no barrier here to this in rem proceeding. The trial court properly denied the Tribe’s motion to dismiss and granted summary judgment to the property owner. We affirm.

Facts and Procedural History

¶2 Sharline and Ray Lundgren and the Tribe own adjacent properties in Skagit County, Washington. A barbed wire fence runs along the southern portion of the Tribe’s land. The fence spans the width of the Tribe’s lot, with a gate approximately halfway along the fence line. The land between the fence and the southern boundary of the Tribe’s lot is the land at issue in this case. For ease of reference, we refer to this land as the “disputed property.”

¶3 The Lundgrens bought the 10 acres of land immediately south of the disputed property in 1981. The property had been in their extended family since 1947, when Sharline Lundgren’s grandmother first bought the property. The Lundgrens established that the fence on the disputed property has been in the same location since at least 1947, and that for as long as their property has been in the family, they have treated the fence as the boundary line. Since 1947, the Lundgren family exclusively has harvested timber, cleared brush, kept the fence clear of fallen trees, and treated the disputed property on the southern side of the fence as their own.

¶4 The Tribe’s land had been previously owned by Annabell Brown for many decades. In 1984, she quitclaimed a one-quarter undivided interest in the property to her son David Brown. Upon her death, the rest of the property passed to her other children, Paul Brown, Vivian Jennings, and Barbara Carrell. In 2013, the Tribe bought the property from Paul Brown, Jennings, and Carrell, receiving a statutory warranty deed. The Tribe was evidently unaware of the fence when it purchased the property. The Tribe’s surveyors alerted the Tribe to the presence of the fence in October 2013 while surveying the property “in an effort to take the land into Trust.” Clerk’s Papers (CP) at 115.

¶5 In September 2014, the Tribe notified the Lundgrens in a letter that the fence did not represent the boundary and that they were asserting ownership rights to the entire property deeded to them in 2013. The Lundgrens initiated this lawsuit in March 2015. They asked the court to quiet title in the disputed property to them and sought injunctive relief. The Lundgrens moved for summary judgment, arguing they acquired title to the disputed property by adverse possession or by mutual recognition and acquiescence long before the Tribe bought the land. The Tribe moved to dismiss under CR 12(b)(1) for a lack of subject matter jurisdiction based on the Tribe’s sovereign immunity and under CR 12(b)(7),¹ which requires joinder of a necessary and indispensable party under CR 19.²

¶6 In the trial court, Judge Dave Needy denied the Tribe’s motion to dismiss. The Tribe moved for direct discretionary review of this ruling. Judge Susan Cook later granted the Lundgrens’ motion for summary judgment, holding the Lundgrens’ “claims of title ownership by adverse possession and mutual recognition and acquiescence is established. Legal title to the disputed property is owned by Plaintiffs.” CP at 159. Judge Cook noted that the fence was not hidden. Both parties recognized the fence as the boundary line and that it had clearly been on the property for much longer than the necessary 10 years. She noted that the Lundgrens’ labor on the property was established by numerous witness declarations. Importantly, she stated that “this is as clear as a case as I’ve had on the bench.” Verbatim Report of Proceedings (VRP) (May 7, 2015) at 20. The Tribe amended its motion for discretionary review to seek review of both Judge Needy’s and Judge Cook’s orders. We accepted direct review. See Order, Lundgren v. Upper Skagit Indian Tribe, No. 91622-5 (Wash. Feb. 10, 2016).

Analysis

¶7 The superior court concluded that because it had in rem jurisdiction, it could determine ownership of the land without the Tribe’s participation. See VRP (Apr. 24,2015) at 24. While it recognized it could not join the Tribe against its will, the court found the Tribe’s attempt to use CR 19 to be “contrary to common sense, fairness, and due process for all involved.” VRP (Apr. 24, 2015) at 32.

¶8 The Tribe argues that dismissal is required for two reasons. First, it argues the superior court lacks jurisdiction because the Tribe has sovereign immunity from suit, which neither the Tribe nor Congress has waived for quiet title actions. See Appellant’s Opening Br. at 10. The Tribe differentiates between an in rem claim and in rem jurisdiction, asserting that “jurisdiction in this case can only lie if the Court has both subject matter jurisdiction and personal jurisdiction over the claims and parties. Thus, the mere fact of an in rem claim does not affect or somehow avoid threshold jurisdictional questions such as sovereign immunity.” Appellant’s Reply Br. at 5. Second, it argues that even if the lower court had in rem jurisdiction to hear the case, CR 19 requires dismissal because the Tribe is a necessary and indispensable party that cannot be joined due to sovereign immunity. See Appellant’s Opening Br. at 24-30; Appellant’s Reply Br. at 1.

¶9 The Lundgrens acknowledge that the Tribe has sovereign immunity. Resp’ts’ Br. at 6 (“The Lundgrens admit that the Tribe is entitled to sovereign immunity.”). They argue that because the court has in rem jurisdiction over the quiet title action, personal jurisdiction over the Tribe is unnecessary and its immunity is irrelevant. They also assert that because they obtained title by adverse possession before the Tribe purchased the property, “[t]he Tribe’s sovereign immunity does not deprive the court of jurisdiction over land the Tribe never owned.” Resp’ts’ Br. at 23. With regard to CR 19, the Lundgrens argue, “[b]ecause the Court has in rem jurisdiction, sovereign immunity is not a bar to jurisdiction, the Tribe is not an indispensable party, and Civil Rule 19 does not prevent the case from proceeding.” Resp’ts’ Br. at 29.

I. In Rem Jurisdiction

¶10 Superior courts in Washington have jurisdiction to exercise in rem jurisdiction to settle disputes over real property.³ Quiet title actions are proceedings in rem. Phillips v. Tompson, 73 Wash. 78, 82, 131 P. 461 (1913); see also 14 Karl B. Tegland, Washington Practice: Civil Procedure § 5:1, at 155 (2d ed. 2009). In such proceedings, the court has jurisdiction over the property itself. See Tegland, supra. Personal jurisdiction over the landowner is not required. In re Acquisition of Land & Other Prop. by City of Seattle, 56 Wn.2d 541, 544-45, 353 P.2d 955 (1960); see also In re Condemnation Petition of City of Lynnwood, 118 Wn. App. 674, 679 & n.2, 77 P.3d 378 (2003) (noting that quiet title actions are proceedings in which the court can exercise in rem jurisdiction, and that “[c]ourts may have jurisdiction to enter judgment with respect to property . . . located within the boundaries of the state, even if personal jurisdiction has not been obtained over the persons affected by the judgment”).

¶11 A court exercising in rem jurisdiction is not necessarily deprived of its jurisdiction by a tribe’s assertion of sovereign immunity. The United States Supreme Court has recognized this principle. In County of Yakima v. Confederated Tribes & Bands of Yakima Indian Nation, 502 U.S. 251, 255, 112 S. Ct. 683, 116 L. Ed. 2d 687 (1992), the county sought to foreclose property within the Yakama Indian Reservation for failure to pay ad valorem taxes. The Yakama Nation argued that state jurisdiction could not be asserted over fee-patented reservation land. The Supreme Court held that the Indian General Allotment Act allowed Yakima County to impose ad valorem taxes on reservation land. 25 U.S.C. §§ 334-381. The Court reached that conclusion by characterizing the county’s assertion of jurisdiction over the land as in rem, rather than an assertion of in personam jurisdiction over the Yakama Nation. In other words, the Court had jurisdiction to tax on the basis of alienability of the allotted lands, not on the basis of jurisdiction over tribal owners. See Anderson & Middleton Lumber Co. v. Quinault Indian Nation, 130 Wn.2d 862, 869-72, 929 P.2d 379 (1996) (describing County of Yakima, 502 U.S. 251).

¶12 This court has similarly upheld a superior court’s assertion of in rem jurisdiction over tribally owned fee-patented land. In Anderson, this court held that the Grays Harbor County Superior Court had in rem jurisdiction over an action to partition and quiet title to fee-patented lands within the Quinault Indian Reservation. In that case, the Quinault Indian Nation purchased a one-sixth interest in the surface estate of fee-patented land subject to a pending suit to partition and to a lis pendens. Relying on County of Yakima, and noting that an action to partition and quiet title is “a much less intrusive assertion of state jurisdiction over reservation fee patented land” than taxing and foreclosing fee lands, the court concluded the “Superior Court had proper in rem jurisdiction over [the] suit to quiet title and partition alienable and encumberable fee patented property situated within the Quinault Indian Reservation. . . . An action for partition of real property is a proceeding in rem ” Anderson, 130 Wn.2d at 872, 873. Furthermore, it was

not disputed that the trial court had proper jurisdiction over this action when it was filed. The subsequent sale of an interest in the property to an entity enjoying sovereign immunity (Quinault Nation) is of no consequence in this case because the trial court’s assertion of jurisdiction is not over the entity in personam, but over the property or the “res” in rem.

Anderson, 130 Wn.2d at 873. The court was exercising jurisdiction over the property, not over the Quinault Indian Nation, and thus the land was “subject to a state court in rem action which does nothing more than divide it among its legal owners according to their relative interests.” Anderson, 130 Wn.2d at 873. Because the court determined there was in rem jurisdiction, it did not need to address sovereign immunity.

¶13 Relying on Anderson, Division One of the Court of Appeals held that the court could exercise in rem jurisdiction in a quiet title action in which the Stillaguamish Tribe of Indians purchased land with notice of a pending quiet title action. Smale v. Noretep, 150 Wn. App. 476, 208 P.3d 1180 (2009). In Smale, the Smales sought to quiet title to property they claimed to have acquired through adverse possession against Noretep, the non-Indian original owner. After the Smales sued, Noretep sold the property by statutory warranty deed to the Stillaguamish Tribe. The deed noted the pending quiet title action, and the Smales added the Stillaguamish Tribe as a defendant. The Stillaguamish Tribe argued that sovereign immunity barred the action. The court found:

Because courts exercise in rem jurisdiction over property subject to quiet title actions, our Supreme Court has held that transferring the disputed property to a tribal sovereign does not bar the continued exercise of subject matter jurisdiction over the property. Accordingly, we hold that the superior court’s continuing jurisdiction over the land claimed by the Smales for the purposes of determining ownership does not offend the Tribe’s sovereignty.

Smale, 150 Wn. App. at 477.

¶14 The court noted, “The quiet title action in Anderson is similar to the quiet title action here in two crucial ways: both are proceedings in rem to determine rights in the property at issue and neither has the potential to deprive any party of land they rightfully own.” Smale, 150 Wn. App. at 483. The Smales alleged they acquired title to the land via adverse possession befoi'e the original owner sold to the Stillaguamish Tribe. If this were true, the Stillaguamish Tribe never possessed the land and thus never had land to lose. Nor were the Smales attempting to adversely possess against a sovereign. The court concluded that, as in Anderson, the doctrine of sovereign immunity did not apply and did not bar the quiet title action. County of Yakima, Anderson, and Smale establish the principle that our superior courts have subject matter jurisdiction over in rem proceedings in certain situations where claims of sovereign immunity are asserted.

II. CR 19

¶15 Next, we turn to whether the Tribe must be joined to allow the action to proceed under CR 19. The Tribe asserts that even if the trial court had in rem jurisdiction to hear the case, CR 19 requires dismissal because the Tribe is a necessary and indispensable party that cannot be joined due to sovereign immunity. Appellant’s Opening Br. at 24. We disagree. In reaching our decision, we highlight the importance of CR 19 as a prudential standard that asks not whether a court has the power to decide a case, but rather whether it should.

¶16 CR 19(a) involves a three-step analysis. Auto. United Trades Org. v. State, 175 Wn.2d 214, 222-23, 285 P.3d 52 (2012). First, the court determines whether absent persons are “necessary” for a just adjudication. If the absentee parties are “necessary,” the court determines whether it is feasible to order the absentee’s joinder. Joinder is generally not feasible when tribal sovereign immunity is asserted. Auto. United Trades Org., 175 Wn.2d at 222 (citing Equal Emp’t Opportunity Comm’n v. Peabody W. Coal Co., 400 F.3d 774, 780-81 (9th Cir. 2005)). “If joining a necessary party is not feasible, the court then considers whether, ‘in equity and good conscience,’ the action should still proceed without the absentees under CR 19(b).” Auto. United Trades Org., 175 Wn.2d at 222. We have recognized that “[d]ismissal under CR 12(b)(7) for failure to join an indispensable party is a ‘drastic remedy’ and should be ordered only when the defect cannot be cured and significant prejudice to the absentees will result.” Auto. United Trades Org., 175 Wn.2d at 222-23 (quoting Gildon v. Simon Prop. Grp., Inc., 158 Wn.2d 483, 494, 145 P.3d 1196 (2006) (citing 7 Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1609, at 130 (3d ed. 2001))).

A. “Necessary” Party

¶17 A party must be joined if adjudication of the matter in the party’s “absence may (A) as a practical matter impair or impede the person’s ability to protect that interest or (B) leave any of the persons already parties subject to substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the person’s claimed interest.” CR 19(a). The heart of the rule is the safeguarding of the absent party’s legally protected interest. Auto. United Trades Org., 175 Wn.2d at 223.

¶18 The Tribe asserts that it has a legally protected interest because it claims record title ownership of the disputed property. Appellant’s Opening Br. at 25. An inquiry under CR 19, as required by our cases, involves a merit-based determination that an interest will be adversely affected in the litigation. In an in rem action, the property at issue is the focus of the proceeding. The nature and end result of an in rem action determines often competing interests in the property. This analysis is in contrast to civil actions, where the nature and end result is relief or judgment. This difference is important here in the context of a legally protected interest because the Lundgrens are not seeking to divest a sovereign of ownership or control. Rather, they are attempting to retain what they already own. Where no interest exists, nonjoinder presents no jurisdictional barriers. While this analysis seems, in a way, to put “the cart before the horse,” this is the relevant CR 19 analysis. Here, as our cases recognize, and as the trial court found, Sharline and Ray Lundgren acquired ownership by adverse possession long before the property was purchased by the Tribe. To find sovereign immunity, some impact on a sovereign’s interest should exist. No such interest exists in this case. In the trial court, the Tribe challenged the Lundgrens’ lawsuit to quiet title and defended against the motion for summary judgment.⁴ The Tribe claimed material issues of fact existed and challenges the summary judgment order here. Considering the facts in the light most favorable to the nonmoving party, we will affirm the trial court’s grant of summary judgment if we determine “that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” CR 56(c). The Lundgrens are entitled to judgment as a matter of law if the undisputed facts establish that the Lundgrens would have succeeded on an adverse possession claim. We hold that they have.

¶19 To succeed on an adverse possession claim, possession must be “(1) open and notorious, (2) actual and uninterrupted, (3) exclusive, and (4) hostile.” ITT Rayonier, Inc. v. Bell, 112 Wn.2d 754, 757, 774 P.2d 6 (1989) (citing Chaplin v. Sanders, 100 Wn.2d 853, 857, 676 P.2d 431 (1984)). “Possession of the property with each of the necessary concurrent elements must exist for the statutorily prescribed period of 10 years.” ITT Rayonier, Inc., 112 Wn.2d at 757 (citing RCW 4.16.020). Additionally, we have held that title becomes vested when the elements of adverse possession, specifically the 10-year time period, are established. In Gorman v. City of Woodinville, 175 Wn.2d 68, 283 P.3d 1082 (2012), we recognized this principle. In that case, the claim was asserted and we found that title was acquired before the government purchased the land in question. We held that as long as the requisites of adverse possession were met before the property was transferred to the government, RCW 4.16.160—which otherwise shields the government from claims of adverse possession—did not control. We found that the quiet title lawsuit against the city could proceed since the legal determination only confirmed that the claim of adverse possession was satisfied before the city acquired the property. The principles recognized in Gorman are important here because the Lundgrens’ claim is based on the fact that title to the land was acquired long before the Tribe purchased the adjacent land.

¶20 The trial court, in granting summary judgment, relied on numerous declarations to find in favor of the Lundgrens. The record establishes that the disputed property has been in the Lundgrens’ extended family since 1947, first purchased by Sharline Lundgren’s grandmother. A permanent, visible, 1,306-foot-fence marked the boundary between the two properties for decades. The Tribe argues that evidence exists that “shows a dispute as to the parties’ knowledge of the existence of the fence.” Appellant’s Opening Br. at 34. Annabell Brown’s brother-in-law, Ray Brown, confirmed that both families were aware of the boundary fence and treated it as the property line. The Tribe asserts that Annabell Brown’s son, David Brown, had no idea the fence was there. Assuming this is true, David Brown’s lack of knowledge is not material to the legal issue in this case because the Lundgrens’ use of the land was sufficient to satisfy the elements of adverse possession. “Open” and “notorious” mean that activities or objects on the land are visible and discoverable, if not actually known, to the true owner. 17 William B. Stoebuck & John W. Weaver, Washington Practice: Real Estate: Property Law § 8.11, at 523 (2d ed. 2004). “[T]he owner is charged with constructive notice of permanent, visible objects placed on the ground, even if they are only slightly upon the land and would be seen to intrude only by scrupulous inspection or even by professional survey.” Stoebuck & Weaver, supra, at 525. The evidence shows that the Lundgrens exclusively possessed and maintained the disputed property. The Tribe asserted no evidence to rebut the testimony that the Lundgrens and their predecessors have gone onto the property, cut trees, trimmed branches, and perhaps mended the fence in the last 70-plus years. Significantly, Judge Cook, in granting summary judgment, stated that “this is as clear as a case as I’ve had on the bench.” VRP (May 7,2015) at 20. We find the material facts undisputed and affirm the entry of order of summary judgment.

B. “Indispensable” Party

¶21 Because we have found that the Tribe is not a necessary party, we need not continue the CR 19 analysis. However, it is important to note that the principle of indispensability is rooted in equitable considerations. Auto. United Trades Org., 175 Wn.2d at 227 (citing Crosby v. Spokane County, 137 Wn.2d 296, 309, 971 P.2d 32 (1999)). The central question is whether an action can proceed “in equity and good conscience.” CR 19(b). The CR 19 inquiry requires “careful exercise of discretion” and is “ ‘heavily influenced by the facts and circumstances of individual cases.’ ” Auto. United Trades Org., 175 Wn.2d at 229 (quoting Wright, Miller & Kane, supra, § 1604, at 39). Of importance here is that dismissal would result in no adequate remedy for the plaintiff. Because of a strong aversion to dismissal, great weight is given to this factor. There is no alternative judicial forum for the Lundgrens. See Wash. Supreme Court oral argument, Lundgren v. Upper Skagit Indian Tribe, No. 91622-5 (June 9, 2016), at 11 min., 42 sec. to 12 min., 7 sec., audio recording by TVW, Washington State’s Public Affairs Network, http://www.tvw.org (explaining that although there is a tribal court, “the Upper Skagit Indian Tribe has not waived its sovereign immunity from suit in its tribal court, so there would not be a claim in the Upper Skagit Tribal Court to be brought by the plaintiffs”).

¶22 The purpose of CR 19 is to serve “ ‘complete justice’ ” by permitting disputes to go forward only when all parties are present to defend their claims. Auto. United Trades Org., 175 Wn.2d at 233. But as we stated in Automotive United Trades Organization, “ ‘complete justice’ may not be served when a plaintiff is divested of all possible relief because an absent party is a sovereign.” 175 Wn.2d at 233. In this instance, dismissal leads to no justice at all. In Automotive United Trades Organization, we emphasized that sovereign immunity is meant to be raised as a shield by a tribe, not as a sword. Here, a survey of the property was done a month after the property was deeded to the Tribe. See Appellant’s Opening Br. at 5-6. A survey of the property before purchase would have disclosed the existence of the fence and at minimum put a purchaser on notice to determine the property boundaries. The Lundgrens had acquired title by adverse possession decades before the Tribe acquired record title in 2013. After the Lundgrens commenced the quiet title action, the Tribe claimed sovereign immunity and joinder under CR 19 to deny the Lundgrens a forum to acquire legal title to property they rightfully own. The Tribe has wielded sovereign immunity as a sword in disguise. While we do not minimize the importance of tribal sovereign immunity, allowing the Tribe to employ sovereign immunity in this way runs counter to the equitable purposes underlying compulsory joinder. See Auto. United Trades Org., 175 Wn.2d at 233-34. Finding otherwise, as correctly articulated by the trial court, is “contrary to common sense, fairness, and due process for all involved.” VRP (Apr. 24, 2015) at 32. We affirm the superior court.

Owens, Wiggins, González, and Yu, JJ., concur.

1 “How Presented. Every defense, in law or fact, to a claim for relief in any pleading, whether a claim, counterclaim, cross claim, or third party claim, shall be asserted in the responsive pleading thereto if one is required, except that the following defense! ] may at the option of the pleader be made by motion: ... (7) failure to join a party under [CR] 19.’’

2 “(a) Persons to Be Joined if Feasible. A person who is subject to service of process and whose joinder will not deprive the court of jurisdiction over the subject matter of the action shall be joined as a party in the action if (1) in the person’s absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person’s absence may (A) as a practical matter impair or impede the person’s ability to protect that interest or (B) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the person’s claimed interest. If the person has not been so joined, the court shall order that the person be made a party. If the person should join as a plaintiff but refuses to do so, the person may be made a defendant, or, in a proper case, an involuntary plaintiff. If the joined party objects to venue and the person’s joinder would render the venue of the action improper, the joined party shall be dismissed from the action.

“(b) Determination by Court Whenever Joinder Not Feasible. If a person joinable under (1) or (2) of section (a) hereof cannot be made a party, the court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: (1) to what extent a judgment rendered in the person’s absence might be prejudicial to the person or those already parties; (2) the extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided; (3) whether a judgment rendered in the person’s absence will be adequate; (4) whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder.’’

3 Article IV, section 6 of the Washington Constitution expressly establishes that our state’s superior courts “shall have original jurisdiction in all cases at law which involve the title or possession of real property.’’ See also RCW 2.08.010.

4 In rem actions require giving notice to any and all persons or entities who may claim an interest in the property to allow those potential claimants the opportunity to participate in the action and assert their interest.