Court Opinion

ID: 2808750
Source: CourtListenerOpinion
Date Created: 2015-06-16 16:06:29.065362+00
Date Added: 2024-06-11T15:38:12.763657
License: Public Domain

This opinion will be unpublished and
                         may not be cited except as provided by
                         Minn. Stat. § 480A.08, subd. 3 (2014).

                              STATE OF MINNESOTA
                              IN COURT OF APPEALS
                                    A14-1948

                        Bank of America, National Association,
                                   Respondent,

                                           vs.

                               James B. Schelling, et al.,
                                     Appellants.

                                  Filed June 15, 2015
                                       Affirmed
                                   Bjorkman, Judge

                            Hennepin County District Court
                             File No. 27-CV-HC-14-5125

Orin J. Kipp, Wilford, Geske & Cook, P.A., Woodbury, Minnesota (for respondent)

William Bernard Butler, Butler Liberty Law, LLC, Minneapolis, Minnesota (for
appellants)

      Considered and decided by Bjorkman, Presiding Judge; Stauber, Judge; and

Klaphake, Judge.

                        UNPUBLISHED OPINION

BJORKMAN, Judge

      Appellants challenge summary judgment in an eviction proceeding, arguing that

(1) respondent’s failure to respond to their requests for admissions established facts in


 Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
their favor that preclude summary judgment and (2) the district court abused its discretion

by denying a stay of the eviction action pending the outcome of a related proceeding. We

affirm.

                                         FACTS

          In February 2006, appellants James Schelling and Jacki Schelling granted a

mortgage on their Minnetonka property to Mortgage Electronic Registration Systems,

Inc. (MERS) as nominee for Countrywide Bank, N.A. MERS assigned the mortgage to

respondent Bank of America, National Association (BOA) in August 2011.                 The

Schellings subsequently defaulted on the mortgage, and BOA commenced foreclosure

proceedings by advertisement. BOA purchased the property at the sheriff’s sale on

March 5, 2014, and the Schellings did not redeem during the six-month redemption

period.

          On September 18, 2014, BOA commenced this eviction action. The Schellings

answered, denying the allegations of the eviction complaint and averring that they would

be entitled to possession of the property when they succeeded in a registration action they

filed on July 21, 2014, challenging the foreclosure and BOA’s title. The Schellings also

served discovery requests, including requests for admissions; BOA did not respond.

BOA moved for summary judgment.           The Schellings opposed summary judgment,

arguing that BOA’s failure to respond to their requests for admissions established several

facts in their favor under Minn. R. Civ. P. 36, and moved for a stay pending the

resolution of the registration action. After a hearing before a housing court referee, the

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district court denied the Schellings’ motion for a stay and granted BOA summary

judgment.1 The Schellings appeal.

                                     DECISION

I.     BOA’s failure to respond to improper and immaterial requests for admissions
       does not preclude summary judgment.

       Summary judgment is appropriate if there are no genuine issues of material fact

and a party is entitled to judgment as a matter of law. Minn. R. Civ. P. 56.03. On appeal

from summary judgment, we review de novo whether there are any genuine issues of

material fact and whether the district court erred in applying the law. Ruiz v. 1st Fid.

Loan Servicing, LLC, 829 N.W.2d 53, 56 (Minn. 2013).

       An eviction action is a “summary court proceeding to remove a tenant or occupant

from or otherwise recover possession of real property by the process of law.” Minn. Stat.

§ 504B.001, subd. 4 (2014).        A party seeking eviction after a foreclosure must

demonstrate that (1) the mortgage on the property has been foreclosed, (2) the statutory

redemption period has expired, (3) the party seeking eviction has the right to possess the

property, and (4) the other party remains in possession of the property. Minn. Stat.

§ 504B.285, subd. 1(a)(1)(ii) (2014). A sheriff’s certificate is prima facie evidence that

all legal requirements relating to the sale have been met and that the purchaser holds title

in fee after the time for redemption has passed. Minn. Stat. § 580.19 (2014); see also

Minn. Stat. § 580.12 (2014) (providing that duly recorded sheriff’s certificate, “upon

1
  When the referee’s findings and order are confirmed by the district court, they become
the findings and order of the district court. Minn. R. Gen. Pract. 602; see also Minn. Stat.
§ 484.70, subd. 7(c) (2014).

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expiration of the time for redemption,” operates “as a conveyance to the purchaser . . . of

all the right, title, and interest of the mortgagor in and to the premises named therein at

the date of such mortgage, without any other conveyance”).

       The Schellings argue that material fact issues are present by virtue of BOA’s

failure to respond to their requests for admissions. See Minn. R. Civ. P. 36.01 (providing

that a party effectively admits a matter of which an admission is requested if it fails to

respond within 30 days). We disagree. First, the district court properly determined that

the formal discovery procedures set out in the Minnesota Rules of Civil Procedure do not

apply because they are inconsistent with the “informal” discovery called for under

housing-court rules. See Minn. R. Gen. Pract. 601 (providing that Minnesota Rules of

Civil Procedure govern housing-court proceedings only “where not inconsistent” with

housing-court rules); see also Minn. R. Gen. Pract. 612 (stating that housing-court

proceedings are “summary” in nature). Second, the Schellings’ requests for admissions

relate to facts concerning the foreclosure process and the validity of BOA’s title—matters

that are outside the narrow scope of an eviction proceeding. See AMRESCO Residential

Mortg. Corp. v. Stange, 631 N.W.2d 444, 445 (Minn. App. 2001). The only material

facts are undisputed: The mortgage was foreclosed, BOA purchased the property at the

sheriff’s sale, the sale was accurately documented in a sheriff’s certificate, the sheriff’s

certificate was properly recorded, the redemption period has expired, and the Schellings

remain on the property. On this record, we conclude that no material facts exist and the

district court properly granted BOA an eviction judgment.

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II.    The district court did not abuse its discretion by denying a stay of the eviction
       proceeding pending the outcome of the Schellings’ registration action.

       A district court has discretion to stay an eviction proceeding in favor of a related

action if the moving party shows a “case-specific justification” for doing so. Deutsche

Bank Nat’l Trust Co. v. Hanson, 841 N.W.2d 161, 164 (Minn. App. 2014). “A dispute

regarding the underlying mortgage is not such a reason.” Id. And even when the moving

party provides a case-specific reason, the district court is not required to grant a stay.

Fed. Home Loan Mortg. Corp. v. Nedashkovskiy, 801 N.W.2d 190, 192 (Minn. App.

2011). We will not reverse the denial of a stay absent an abuse of discretion. Id.

       The Schellings contend that the “case-specific justification” for staying the

eviction proceeding is that the registration action is necessary for BOA to obtain title to

the property and therefore “necessary to a fair determination of the eviction action.” See

Bjorklund v. Bjorklund Trucking, Inc., 753 N.W.2d 312, 318-19 (Minn. App. 2008)

(holding abuse of discretion to deny stay in favor of “necessary” related action), review

denied (Minn. Sept. 23, 2008). We are not persuaded. BOA must commence a separate

proceeding to change the ownership line on the certificate of title. Minn. Stat. § 508.58,

subd. 1 (2014). But the Schellings have cited no authority for the proposition that it must

do so before it may gain possession through an eviction proceeding. To the contrary, the

foreclosure process effectuates the transfer of ownership, regardless of whether the

property is registered or not. Minn. Stat. § 580.12; see also Minn. Stat. § 508.57 (2014)

(“Mortgages upon registered land may be foreclosed in the same manner as mortgages

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upon unregistered land.”).     The registration process merely codifies that transfer of

ownership. See Minn. Stat. § 508.58, subd. 1.

       The Schellings failed to demonstrate that the registration action they commenced

to challenge BOA’s claim to the property has any bearing on the eviction proceeding, let

alone that it is necessary to a fair determination of that proceeding. Accordingly, we

conclude the district court did not abuse its discretion by denying their motion for a stay.

       Affirmed.

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