IN THE SUPREME COURT

STATE OF NORTH DAKOTA

2021 ND 99

PLS Services, LLC, Plaintiff and Appellant

v.

Valueplus Consulting, LLC, Defendant and Appellee

and

Clear Creek Retirement Plan LLC; John Wesley 

Johnson P.S. Defined Benefit Plan; 2011-12

Opportunity Fund 6-1, LLC; and all persons 

unknown claiming any estate or interest in, or 

lien or encumbrance upon, the real estate 

described in the Complaint; Robert L. Doremus 

and Shannon M. Doremus DBA Sound 

Investments Company; Dale John Huysman and 

Anita Ruth Huysman; and Rusty Fields, Defendants

No. 20200270

Appeal from the District Court of Williams County, Northwest Judicial 

District, the Honorable Paul W. Jacobson, Judge.

REVERSED AND REMANDED.

Opinion of the Court by McEvers, Justice.

Steven A. Lautt, Minot, ND, for plaintiff and appellant.

Trevor A. Hunter, Williston, ND, for defendant and appellee.

FILED 

IN THE OFFICE OF THE 

CLERK OF SUPREME COURT 

JUNE 3, 2021 

STATE OF NORTH DAKOTA
1

PLS Services v. Clear Creek Retirement Plan

No. 20200270

McEvers, Justice.

[¶1] PLS Services appeals a district court’s amended summary judgment 

dismissing its complaint against Valueplus Consulting, LLC, relating to a 

mortgage priority dispute. We conclude the district court did not abuse its 

discretion in certifying the summary judgment against PLS as final under 

N.D.R.Civ.P. 54(b), but we conclude the court erred in granting summary 

judgment. We reverse and remand.

I

[¶2] In February 2014, PLS was assigned two mortgages executed on June 

29, 2012, and recorded on July 10, 2012, against certain Williams County real 

property owned by Clear Creek Retirement Plan LLC. The subject property is 

legally described as:

Lot 22R, Block 9, Madison Ridge Rearrangement #3, in Blocks 7, 9 

& 10 in the E1⁄2 Section 30, Township 154 North, Range 101 West 

of the 5th P.M., Williams County, North Dakota

The mortgages and assignments to PLS contained incorrect legal descriptions 

and were therefore recorded in an errant tract index. The mortgages described 

the property as: “Lot 22R, Block 9, Madison Ridge Rearrangement,” instead of 

“Lot 22R, Block 9, Madison Ridge Rearrangement #3.” Lot 22R, Block 9, 

Madison Rearrangement does not exist.

[¶3] Clear Creek and Valueplus executed a June 2012 purchase agreement

whereby Valueplus agreed to purchase the subject property from Clear Creek. 

As part of the agreement, Clear Creek granted a $225,000 mortgage to 

Valueplus on July 12, 2012, containing the same errant legal description as 

the mortgages assigned to PLS. Valueplus executed a satisfaction of mortgage 

on March 15, 2013. On March 14, 2013, Clear Creek granted another $225,000 

mortgage to Valueplus containing the correct legal description of the subject 

property. Valueplus did not purchase the property from Clear Creek, and the
2

mortgage was satisfied by a November 2013 satisfaction of mortgage executed 

by Valueplus.

[¶4] In January 2014, Fidelity Capital Services LLC assigned to Valueplus a

mortgage against the subject property. The mortgage contained the correct 

legal description and was recorded in August 2013. In 2017, Valueplus sued 

Clear Creek to foreclose the mortgage. PLS moved to intervene, asserting its 

mortgages had priority. The district court denied PLS’s motion, and Valueplus

subsequently purchased the subject property in June 2019.

[¶5] In July 2019, PLS sued Clear Creek, Valueplus, and others, alleging it 

had a superior interest in the subject property. PLS sought reformation and 

foreclosure of its mortgages. Valueplus denied the allegation and moved for 

summary judgment, arguing it purchased the property in good faith because it 

was unaware of PLS’s mortgages containing an incorrect legal description. PLS 

opposed Valueplus’ motion, asserting Valueplus was not a good faith 

purchaser. PLS also argued it needed more time for discovery because 

Valueplus moved for summary judgment less than one month after answering 

the complaint.

[¶6] The district court granted Valueplus’ motion, concluding Valueplus was 

a good faith purchaser of the property and did not have actual knowledge or 

constructive notice of PLS’s mortgages. The court also concluded PLS’s claims 

against Valueplus were frivolous and ordered PLS to pay Valueplus’ costs,

including attorney’s fees. The court entered summary judgment ordering PLS 

to immediately release its lis pendens against the subject property and pay 

Valueplus $16,623 in costs and fees. On PLS’s motion, the court subsequently 

amended the summary judgment, certifying the judgment against PLS as final 

under N.D.R.Civ.P. 54(b).

II

[¶7] Before reaching the merits of the appeal, we must first determine 

whether the district court appropriately certified entry of a final judgment 

under N.D.R.Civ.P. 54(b). Rule 54(b), N.D.R.Civ.P., preserves our longstanding policy against piecemeal appeals, and provides:
3

If an action presents more than one claim for relief, whether as a 

claim, counterclaim, crossclaim, or third-party claim, or if multiple 

parties are involved, the court may direct entry of a final judgment 

as to one or more, but fewer than all, claims or parties only if the 

court expressly determines that there is no just reason for delay. 

Otherwise, any order or other decision, however designated, that 

adjudicates fewer than all the claims or the rights and liabilities of 

fewer than all the parties does not end the action as to any of the 

claims or parties and may be revised at any time before the entry

of a judgment adjudicating all the claims and all the parties’ rights 

and liabilities.

[¶8] We review a district court’s decision to grant N.D.R.Civ.P. 54(b)

certification under an abuse-of-discretion standard. Tharaldson Ethanol Plant 

I, LLC v. Vei Glob., Inc., 2014 ND 94, ¶ 15, 845 N.W.2d 900. A court abuses its 

discretion when it acts in an arbitrary, unreasonable, or unconscionable 

manner, when its decision is not the product of a rational mental process 

leading to a reasoned determination, or when it misinterprets or misapplies 

the law. Id.

[¶9] The district court must weigh the competing equities and take into 

account judicial administrative interests in deciding whether to grant 

certification under N.D.R.Civ.P. 54(b). Tharaldson, 2014 ND 94, ¶ 16. “A Rule 

54(b) certification should not be routinely granted and is reserved for cases 

involving unusual circumstances where failure to allow an immediate appeal 

would create a demonstrated prejudice or hardship.” Citizens State BankMidwest v. Symington, 2010 ND 56, ¶ 9, 780 N.W.2d 676. We have outlined a 

list of factors a court should consider, including:

(1) the relationship between the adjudicated and unadjudicated 

claims; (2) the possibility that the need for review might or might 

not be mooted by future developments in the district court; (3) the 

possibility that the reviewing court might be obliged to consider 

the same issue a second time; (4) the presence or absence of a claim 

or counterclaim which could result in setoff against the judgment 

sought to be made final; (5) miscellaneous factors such as delay, 

economic and solvency considerations, shortening the time of trial, 

frivolity of competing claims, expense, and the like.
4

Tharaldson, at ¶ 16.

[¶10] “We have recognized that a Rule 54(b) certification may be appropriate 

if the certified judgment completely decides an entire claim.” Symington, 2010 

ND 56, ¶ 10. “We have also held that a district court does not abuse its 

discretion in granting a Rule 54(b) certification if the issues raised in the 

appeal will not be mooted by future developments in the district court.” Id.

(citing Public Service Comm’n v. Wimbledon Grain Co., 2003 ND 104, ¶ 12, 663 

N.W.2d 186; Hansen v. Scott, 2002 ND 101, ¶ 15, 645 N.W.2d 223; Symington 

v. Walle Mut. Ins. Co., 1997 ND 93, ¶ 8, 563 N.W.2d 400).

[¶11] The district court addressed the factors to consider in granting 

N.D.R.Civ.P. 54(b) certification, and it found “each of the factors weigh[ed] in 

favor of certification.” The court found the only claim between PLS and 

Valueplus was the priority of their interests in the subject property. The court 

found none of the unadjudicated claims involved the property; rather, PLS’s 

claims alleged breach, fraud, negligence, and unjust enrichment claims against 

other parties, for which PLS sought money damages. The court found the 

results of the unadjudicated claims will have no bearing on the priority dispute 

between PLS and Valueplus. The court found the priority dispute will not be 

mooted by the decision on PLS’s remaining claims. The court found a decision 

on the remaining claims would not offset the priority dispute between PLS and 

Valueplus. The court found PLS may suffer a harsh result because the 

summary judgment required PLS to release its lis pendens, and Valueplus may 

sell the property before PLS’s remaining claims are resolved.

[¶12] Nothing in the record indicates Valueplus intended to sell the property

before the district court resolved PLS’s remaining claims. Nonetheless, the 

court’s remaining analysis is sufficient to understand the rationale for its 

decision and supports certification. The court completely decided the priority 

dispute between PLS and Valueplus, which is the lone claim between the 

parties. PLS’s remaining claims do not involve interests in the property, are 

not logically related legally and factually, and are not closely intertwined to its 

claim against Valueplus. PLS’s priority claim against Valueplus will need to 

be decided and will not be mooted by the court’s decisions on PLS’s remaining 
5

claims. The resolution of the remaining claims will not result in a setoff against 

PLS’s priority claim. Those factors weigh in favor of certification, and we 

conclude the court did not abuse its discretion in granting the N.D.R.Civ.P. 

54(b) certification to allow immediate appellate review of the priority claim.

III

[¶13] Our standard of review for a district court’s grant of summary judgment 

is well established:

Summary judgment is a procedural device for the prompt 

resolution of a controversy on the merits without a trial if there 

are no genuine issues of material fact or inferences that can 

reasonably be drawn from undisputed facts, or if the only issues to 

be resolved are questions of law. A party moving for summary 

judgment has the burden of showing there are no genuine issues 

of material fact and the moving party is entitled to judgment as a 

matter of law. In determining whether summary judgment was 

appropriately granted, we must view the evidence in the light most 

favorable to the party opposing the motion, and that party will be 

given the benefit of all favorable inferences which can reasonably 

be drawn from the record. On appeal, this Court decides whether 

the information available to the district court precluded the 

existence of a genuine issue of material fact and entitled the 

moving party to judgment as a matter of law. Whether the district 

court properly granted summary judgment is a question of law 

which we review de novo on the entire record.

Thompson-Widmer v. Larson, 2021 ND 27, ¶ 10, 955 N.W.2d 76 (quoting THR 

Minerals, LLC v. Robinson, 2017 ND 78, ¶ 6, 892 N.W.2d 193).“This Court has 

repeatedly held that summary judgment is inappropriate if the [district] court 

must draw inferences and make findings on disputed facts to support the 

judgment.” Farmers Union Oil Co. of Garrison v. Smetana, 2009 ND 74, ¶ 10, 

764 N.W.2d 665. The court may not weigh the evidence, determine credibility, 

or attempt to discern the truth of the matter when ruling on a summary 

judgment motion. Martin v. Marquee Pac., LLC, 2018 ND 28, ¶ 10, 906 N.W.2d 

65.
6

IV

[¶14] PLS argues the district court erred in concluding Valueplus was a good 

faith purchaser of the subject property.

[¶15] “A party’s status as a good faith purchaser without notice of a competing 

interest is a mixed question of fact and law.” Sundance Oil & Gas, LLC v. Hess 

Corp., 2017 ND 269, ¶ 12, 903 N.W.2d 712. We have stated the facts necessary 

to decide whether a party has attained the status of a good faith purchaser 

without notice constitute findings of fact. Id. Conversely, a district court’s 

ultimate determination a party acted in good faith constitutes a conclusion of 

law. Id.

[¶16] This Court has defined a good faith purchaser as follows:

Good faith is “an honest intention to abstain from taking 

any unconscientious advantage of another even through the forms 

or technicalities of law, together with an absence of all information 

or belief of facts which would render the transaction 

unconscientious.” N.D.C.C. § 1-01-21. A good-faith purchaser must 

acquire rights without actual or constructive notice of another’s 

rights. [Farmers Union Oil Co. v.] Smetana, 2009 ND 74, ¶ 16, 764 

N.W.2d 665. Actual notice consists of express information of a fact, 

N.D.C.C. § 1-01-23, and constructive notice is notice imputed by 

law to a person not having actual notice. N.D.C.C. § 1-01-24. A 

person who has “actual notice of circumstances sufficient to put a 

prudent person upon inquiry as to a particular fact and who omits 

to make such inquiry with reasonable diligence is deemed to have 

constructive notice of the fact itself.” N.D.C.C. § 1-01-25; Erway v. 

Deck, 1999 ND 7, ¶ 10, 588 N.W.2d 862. Whether a party acted in 

good faith is a question of fact. Smetana, at ¶ 15. “The record of 

any instrument shall be notice of the contents of the instrument, 

as it appears of record, as to all persons.” N.D.C.C. § 47-19-19. This 

Court long ago recognized that the language in N.D.C.C. § 47-19-

19 provides constructive notice of the contents of a recorded 

instrument to all purchasers and encumbrancers subsequent to 

the recording. First Nat’l Bank v. Big Bend Land Co., 38 N.D. 33, 

37, 164 N.W. 322 (1917). See Wheeler v. Southport Seven Planned 

Unit Dev., 2012 ND 201, ¶ 17, 821 N.W.2d 746; Bangen v. 

Bartelson, 553 N.W.2d 754, 758 (N.D. 1996).
7

Sundance Oil & Gas, 2017 ND 269, ¶ 13 (quoting Desert Partners IV, L.P. v. 

Benson, 2016 ND 37, ¶ 13, 875 N.W.2d 510).

[¶17] PLS claims that because Valueplus had a similar mortgage containing 

the same errant legal description, Valueplus had or should have had notice of 

PLS’s mortgages, and should have inquired further into PLS’s competing 

interest.

[¶18] The district court concluded Valueplus acquired its interest in the 

subject property in good faith because it had no actual knowledge or 

constructive notice of PLS’s mortgages. The court concluded Valueplus did not 

have constructive notice of PLS’s mortgages under this Court’s decision in 

Hanson v. Zoller, 187 N.W.2d 47 (N.D. 1971). The court also found Valueplus 

did not have actual knowledge on the basis of the affidavit of Rakesh Gupta, 

Valueplus’ manager.

[¶19] In Hanson, 187 N.W.2d at 56, this Court “conclude[d] that a prospective 

purchaser cannot be deemed to have constructive notice of instruments that 

are not indexed in the tract index under the specific tract of real estate to which 

they pertain.” “[T]here must be substantial compliance with those sections of 

the recording laws that pertain to the matter of notice in order to give 

constructive notice.” Id. “Failure to index an instrument in the tract index does 

not constitute such compliance.” Id.

[¶20] Although Valueplus had a similar mortgage that included the same 

errant legal description, under Hanson, Valueplus did not have a duty to 

inquire further into PLS’s mortgages to determine the correct legal description 

of the mortgaged property. The district court correctly concluded Valueplus did

not have constructive notice that PLS’s mortgages were intended to encumber 

the subject property.

[¶21] The district court also found Valueplus did not have actual knowledge of 

the mortgages assigned to PLS. In making this conclusion, the court appeared 

to rely heavily on Rakesh Gupta’s affidavit. Gupta stated he had no knowledge 

of the errant legal description on the July 2012 mortgage with Clear Creek. 

Gupta stated Clear Creek, not Valueplus, handled the recording of the errant 
8

mortgage and subsequent satisfaction of the mortgage. Gupta stated he did not 

learn of PLS’s mortgages until PLS attempted to intervene in Valueplus’ 2017 

foreclosure action.

[¶22] Valueplus moved for summary judgment less than one month after 

answering the complaint. PLS opposed Valueplus’ summary judgment motion 

and requested a continuance under N.D.R.Civ.P. 56(f) for additional discovery 

on whether Valueplus had knowledge of the mortgages assigned to PLS. A 

party’s request for additional time for discovery under N.D.R.Civ.P. 56(f) is 

within the district court’s sound discretion. Choice Fin. Grp. v. Schellpfeffer, 

2006 ND 87, ¶ 9, 712 N.W.2d 855.

[¶23] Instead of addressing PLS’s request for additional discovery in its order 

granting summary judgment, the district court concluded Gupta’s affidavit 

was “uncontradicted” and Valueplus had no actual knowledge of PLS’s 

mortgages. However, PLS did not have the opportunity to cross-examine the 

statements made in Gupta’s affidavit or depose him. See Aho v. Maragos, 1998 

ND 107, ¶ 4, 579 N.W.2d 165 (Stating “summary judgment under Rule 56 is 

only appropriate if the nonmoving party has had a full opportunity to conduct 

discovery to develop information essential to its position.”); Choice Fin. Grp., 

2006 ND 87, ¶ 15 (Stating that when the facts are in the moving party’s 

possession a continuance of a motion for summary judgment for additional 

discovery should be granted almost as a matter of course.). We conclude the 

court abused its discretion by not addressing PLS’s Rule 56(f) request for 

additional discovery in its order granting summary judgment. We reverse and

remand for further proceedings.

V

[¶24] Because we are reversing the district court’s summary judgment in favor 

of Valueplus, we reverse the court’s award of attorney’s fees to Valueplus.
9

VI

[¶25] The amended summary judgment is reversed and remanded for further 

proceedings.

[¶26] Jon J. Jensen, C.J.

Gerald W. VandeWalle

Daniel J. Crothers

Lisa Fair McEvers

Jerod E. Tufte