Kvande v. Thorson , 2020 ND 186 ( 2020 )

Filed 08/27/2020 by Clerk of Supreme Court
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2020 ND 186Keith Kvande, Plaintiff and Appellee
v.
Dennis Thorson, Defendant and Appellant
No. 20190356
Appeal from the District Court of Williams County, Northwest Judicial
District, the Honorable Benjamen J. Johnson, Judge.
AFFIRMED.
Opinion of the Court by McEvers, Justice.
Charles L. Neff, Williston, ND, for plaintiff and appellee.
Thomas E. Kalil, Williston, ND, for defendant and appellant.
Kvande v. Thorson
No. 20190356
McEvers, Justice.
[¶1] Dennis Thorson appeals from a judgment ordering him to remove a
building from Keith Kvande’s property. Thorson argues laches and equitable
estoppel apply and prevent Thorson’s removal from the property. We conclude
the district court did not err by finding laches and equitable estoppel do not
apply and do not preclude the court from ordering the removal of the building
from Kvande’s property. We affirm.
I
[¶2] Kvande owns real property described as Lot 3 in Block 1 of the School
Addition to the City of Wheelock, Williams County, North Dakota. In 2012,
Thorson purchased a building located in Epping, North Dakota. Kvande and
Thorson had multiple discussions about moving the building to Kvande’s
property. Thorson claimed they discussed moving the building onto Kvande’s
property permanently, but Kvande claimed they only discussed moving the
building onto his property for temporary storage. The parties did not have a
written agreement about the property or the building.
[¶3] In fall 2012, Thorson had a concrete foundation poured for the building
on Kvande’s property and moved the building onto the foundation. Thorson
hooked the building up to sewer, water, and electrical service, and he began
living in the building. Thorson did not pay Kvande rent or purchase the
property.
[¶4] In May 2015 or 2016, Kvande demanded Thorson vacate the property,
but Thorson did not leave. Kvande then attempted to evict Thorson from the
property.
[¶5] In September 2017, Kvande sued Thorson, requesting the district court
order Thorson to remove the building from the property and return the
property to its prior state or award him the cost of having the building removed
and the property restored. Kvande alleged Thorson placed the building and the
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foundation on his property without his permission. Thorson answered and
counterclaimed for breach of contract and asserted Kvande’s claims were
barred by laches, estoppel, statute of frauds, waiver, or failure of consideration.
[¶6] After a bench trial, the district court found the parties did not have a
written agreement related to the property and the building, there was no
evidence the parties ever reached an agreement on the sale price of the
property, and there was not an enforceable oral contract for the sale of the
property to Thorson. The court found promissory estoppel does not apply
because there was no enforceable agreement and promissory estoppel requires
a promise or agreement with clear and definite essential terms. The court
found the doctrine of equitable estoppel also cannot be used to create an
enforceable agreement, and therefore does not apply. The court found laches
does not apply because Thorson failed to prove he was prejudiced by Kvande’s
delay in bringing the action.
[¶7] The district court ordered Thorson to remove or demolish the building
and the foundation and to restore the ground to its original grade within 120
days from the date of entry of the judgment. The court further ordered that if
Thorson failed to remove or demolish the building within the 120-day period,
the building would be deemed a fixture on the property and would belong to
Kvande. Judgment was entered.
[¶8] Thorson moved for a stay of execution of the judgment. The district court
granted Thorson’s motion.
II
[¶9] In an appeal from a bench trial, this Court reviews the district court’s
findings of fact under the clearly erroneous standard of review, and its
conclusions of law are fully reviewable. Larson v. Tonneson, 2019 ND 230, ¶ 10,
933 N.W.2d 84. A finding of fact is clearly erroneous if it is induced by an
erroneous view of the law, if there is no evidence to support it, or if after
reviewing all of the evidence, we are convinced a mistake has been made. Id.The court’s findings are presumptively correct, and we will not second-guess
the court’s credibility determinations. Id.2
III
[¶10] Thorson argues the district court erred by finding laches does not apply
and by finding he was not prejudiced by Kvande’s delay in bringing suit.
Thorson contends evidence established there was a four-year delay from the
foundation being dug for the building and Kvande demanding he leave the
property, and he was prejudiced by the delay in Kvande enforcing his rights.
Thorson claims he made improvements to the building and spent substantial
sums of money during that time.
[¶11] Laches is an affirmative defense arising out of equity. Black Stone
Minerals Co., L.P. v. Brokaw, 2017 ND 110, ¶ 16, 893 N.W.2d 498. “Laches is
a delay or lapse of time in commencing an action that works a disadvantage or
prejudice to the adverse party because of a change in conditions during the
delay.” Stenehjem ex rel. State v. Nat’l Audubon Soc’y, Inc., 2014 ND 71, ¶ 12,
844 N.W.2d 892 (quoting Johnson v. State, 2006 ND 122, ¶ 8, 714 N.W.2d 832).
Laches does not arise from the delay of time alone; rather, it is the delay in
enforcing a person’s rights that disadvantages another. Stenehjem, at ¶ 12.
[¶12] “The party against whom laches is sought to be invoked must be actually
or presumptively aware of his rights and must fail to assert them against a
party who in good faith permitted his position to become so changed that he
could not be restored to his former state.” Stenehjem, 2014 ND 71, ¶ 12 (quoting
Bakken v. Duchscher, 2013 ND 33, ¶ 19, 827 N.W.2d 17). The party asserting
laches has the burden of proving he was so prejudiced during the delay that he
cannot be restored to the status quo. Stenehjem, at ¶ 12. Whether laches bars
a claim is a fact intensive inquiry and depends on the facts and circumstances
of the case. Id. at ¶ 13. Laches is generally a question of fact. Siana Oil & Gas
Co., L.L.C. v. Dublin Co., 2018 ND 164, ¶ 24, 915 N.W.2d 134.
[¶13] The district court found laches does not apply because Thorson’s
circumstances have remained unchanged since the fall of 2012, and therefore,
Thorson was unable to prove any prejudice due to Kvande’s delay in bringing
suit. The court found, “Thorson suffered no prejudice from Kvande bringing
this action in 2017 instead of 2013.”
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[¶14] Thorson argues the district court erred by finding there was no evidence
of prejudice because there was evidence he spent $10,000 to move the building
and install a concrete foundation. He contends Kvande could have stopped him
and Kvande’s failure to assert his rights caused Thorson considerable expense.
[¶15] Evidence established Thorson completed excavation for the foundation,
had the foundation poured, and installed a power pole on the property, before
the building was moved onto the property. Thorson testified the foundation
was in place when he moved the building to Kvande’s property in fall 2012.
Thorson testified he hooked the building up to the septic system that was
already on the property, the building was not hooked up to the city or rural
water, and he put a pole in for electrical and MDU put a meter on the pole.
Evidence also established Kvande was aware of work Thorson was completing
on the property before the building was moved onto the property. Evidence
established the work on the property occurred in 2012 around the time the
building was moved onto the property, and Thorson did not present any
evidence of improvements made or costs incurred after the building was placed
on the property. There was no evidence about any improvements to the
property after Thorson moved the building onto the foundation. Thorson failed
to allege or prove any prejudice occurred by the delay between the building
being placed on the property and the lawsuit being filed.
[¶16] In regard to Thorson’s argument of the prejudice caused by Kvande’s
failure to stop the process of installing the foundation and moving the building,
Thorson misconstrues the requirements of laches. Whatever sums Thorson
expended on any improvements to the land could have been ascertained, and
therefore he could have been compensated and restored to his former status.
See Strom v. Giske, 68 N.W.2d 838, 847 (holding the defense of laches cannot
be sustained when a party can be restored to his former status). Thorson has
not argued on appeal that he is entitled to money damages, rather he argues
that he should not be removed from the property.
[¶17] Laches is an equitable defense. Evidence established Kvande and
Thorson did not have an agreement to convey the property to Thorson. Thus,
a successful laches claim would divest Kvande of his interest in the property.
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We are not aware of any precedent allowing a party’s claim to convert laches
into an offensive weapon capable of divesting an owner of property interests
through inaction. Cf. Black Stone Minerals, 2017 ND 110, ¶ 16 (stating the
Court was not aware of any precedent that would allow the party’s claim to
convert laches into an offense weapon capable of divesting a surface owner of
mineral interests through inaction).
[¶18] The evidence supports the district court’s finding that Thorson did not
prove he was prejudiced by Kvande’s delay in bringing an action. We conclude
the court did not err in finding laches does not preclude Kvande’s claim.
IV
[¶19] Thorson argues equitable estoppel applies and prevents Kvande from
denying the existence of an agreement. He contends there was an enforceable
agreement to allow him to permanently live on the property.
[¶20] Estoppel is generally a question of fact. Blume Constr., Inc. v. State ex
rel. Job Serv. N.D., 2015 ND 285, ¶ 32, 872 N.W.2d 312. This Court has said
the purpose of equitable estoppel is to preserve rights already acquired and not
to create new rights. Lohse v. Atl. Richfield Co., 389 N.W.2d 352, 357-58 (N.D.
1986). “[E]quitable estoppel does not by itself give rise to a cause of action, and
it cannot be used to create an enforceable agreement between the parties.”
Hayden v. Medcenter One, Inc., 2013 ND 46, ¶ 27, 828 N.W.2d 775.
[¶21] Although Thorson claims there was an agreement, he testified they did
not agree on the essential terms. He testified he did not pay Kvande anything
for his use of the property during the years he has been living there, he did not
pay the property taxes, and they did not agree on a purchase price. The district
court found there was no agreement, and the evidence supports that finding.
Because there was no evidence of an agreement, the court did not err in finding
equitable estoppel does not apply.
[¶22] To the extent Thorson argues the district court erred in finding
promissory estoppel does not apply, this Court has said promissory estoppel
requires the promise to be “clear, definite, and unambiguous as to essential
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terms before the doctrine of promissory estoppel may be invoked to enforce an
agreement . . . .” Valentina Williston, LLC v. Gadeco, LLC, 2016 ND 84, ¶ 25,
878 N.W.2d 397 (quoting Univ. Hotel Dev. v. Dusterhoft Oil, Inc., 2006 ND 121,
¶ 11, 715 N.W.2d 153). Thorson and Kvande never agreed to a purchase price
of the property or a rental payment. The parties did not agree to the essential
terms, and therefore the alleged agreement cannot be enforced under
promissory estoppel.
[¶23] We conclude the district court did not err in finding equitable estoppel
and promissory estoppel do not apply.
V
[¶24] Thorson requests this Court order the district court to reset its 120-day
order for removal of the building from the property. He states the deadline is
presently stayed until this Court rules on the matter, but he claims the
deadline will have already passed if this Court affirms the judgment. We
decline to grant his request.
VI
[¶25] We affirm the judgment.
[¶26] Lisa Fair McEvers
Daniel J. Crothers
Jerod E. Tufte
Gerald W. VandeWalle
Jon J. Jensen, C.J.
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