Court Opinion

ID: 9687371
Source: CourtListenerOpinion
Date Created: 2023-08-24 16:26:32.243931+00
Date Added: 2024-06-11T12:07:10.719882
License: Public Domain

PAUL H. ANDERSON, Justice
(dissenting).
I respectfully dissent. We have not previously answered the question of whether, in an action for slander of title, attorney fees and other legal expenses incurred in clearing title are recoverable as special damages. This is an important question, deserving an answer. But the majority has essentially put the cart before the horse by adopting Section 633 in its entirety in the context of facts that do not present the issue it seeks to decide.
A thorough examination of the facts and procedural history of this case makes two clear points. First, the record does not show a clear nexus between appellant Charles E. Hughes’ alleged attorney fees and legal expenses and any attempt to clear title to the real property (Property). Further, the record demonstrates that Hughes has not made even a prima facie showing that his quiet title and slander of title claims against Fidelity National Title Insurance Company of New York (Fidelity) were the direct and necessary consequence of Fidelity’s actions. Accordingly, this case falls woefully short of presenting a proper context within which to adopt a rule on whether attorney fees may constitute special damages. Therefore, we should either dismiss as improvidently granted or, in the alternative, affirm the district court’s grant of summary judgment.
Both Hughes and Fidelity agree that a pecuniary loss is required in a slander of title action. Hughes concedes that he sustained no pecuniary loss in the form of special damages other than his attorney fees and other legal expenses incurred in his prior litigation with the Paidars, but he claims that these are special damages. In support of his claim, he asserts that the clear trend nationally in recent years has been to recognize that attorney fees and other legal expenses incurred in clearing a disparaged title are recoverable as special *283damages in the common law action of. slander of title. He specifically cites Rorvig v. Douglas, 123 Wash.2d 854, 873 P.2d 492, 497 (1994), to support this argument. He further asserts that the Restatement supports allowing recovery of litigation expenses in a slander of title- action and urges that we adopt Section 633 of Restatement (Second) of Torts.
Fidelity asserts that Hughes’ emphasis on Section 633 is misplaced. It claims that even were we to adopt Section 633 of the Restatement, Hughes would not be entitled to recovery because the prior litigation expenses he incurred were not a direct consequence of Fidelity’s conduct. Thus, the key question becomes whether the attorney fees and other legal expenses incurred by Hughes during his prior litigation with the Paidars were a direct consequence of Fidelity’s conduct. Fidelity asserts that the record does not demonstrate that Hughes’ initial, unilateral action to evict the Paidars from the property was caused by Fidelity’s refusal to relinquish its claims on the Property. If Fidelity’s conduct did not necessitate the litigation with the Paidars, the attorney fees and other legal expenses are not recoverable. See Stickney v. Goward, 161 Minn. 457, 459-60, 201 N.W. 630, 631 (1925).
Section 633 specifically relates to the recovery of pecuniary loss for “impairment of vendibility or value caused by disparagement” and the expense of measures reasonably necessary to “remove the doubt cast upon vendibility or value by disparagement.” Restatement (Second) of Torts § 633(l)(a)-(b) (1977). For there- to be recovery, there must be legal causation. Here the comments to Section 632 of the Restatement are helpful. The injurious statement must be a substantial factor that brings about the loss. See Restatement (Second) of Torts, § 632, cmt. b (1977). A relevant part of the comment to Section 632 reads as follows:
Thus the vendibility of land, chattels or intangible things may be impaired when a statement makes them appear less desirable for purchase, lease or other dealings than they actually are. But the liability does1 not accrue until the publication of the disparaging matter operates as a substantial factor in determining the decision of a prospective purchaser or other interested persons, to refrain from buying or otherwise acquiring the thing in question, or causes the oumer to incur the expense of such legal proceedings as may be available or necessary to remove the cloud upon the vendibility that is cast upon it by the publication.
Id. (emphasis added).
Hughes’ prior litigation involved (1) the unlawful detainer action brought by Hughes to have the Paidars evicted, and (2) the Paidars’ declaratory judgment brought one week before the trial of Hughes’ unlawful detainer action in which the Paidars sought specific performance of the purchase agreement. For Hughes to recover, Fidelity’s conduct must be the immediate and direct legal cause of the unlawful detainer action, but the unlawful detainer action is unrelated to removing any impairment of vendibility. There is even less of a connection between Fidelity’s conduct and the Pai-dars’ specific performance action. In this action, the Paidars in essence sought specific performance of the purchase agreement that, in the end, they performed.
• It was not until after the Paidars’ 'specific performance action was filed and settled that Hughes sought to “quiet title” to the Property and he did not commence his action until August 21, 1997, 24 days after the Paidars, on the record in open court, waived any objection to Fidelity’s filing. At this point, the quiet title action was not necessary to preserve this deal or the ven-dibility of the property.
Further, the Paidars did not seek to rescind the purchase agreement;- rather, they were trying to get the court to enforce the purchase agreement. It was Hughes, by virtue of his unlawful detainer *284action, who wanted to rescind the purchase agreement after the Paidars made nearly $50,000 in improvements to the property. By the time this action by Hughes was brought, the Paidars had guaranteed that they would defend, hold, and save Hughes harmless from any claims made by Fidelity. The prior litigation expenses with respect to the Paidars that Hughes seeks to recover were not the direct legal consequence of Fidelity’s conduct. Rather, these litigation expenses were the consequence of Hughes’ unlawful detainer action to eject the Paidars from the property after they had made significant improvements. The record on its face fails to support Hughes’ claim even if we were to adopt Section 633.
We should at least require some prima facie showing of' a legal causation for the alleged special damages before we adopt Section 633’s statement of the law and remand to the district court for reconsideration. I conclude the district court properly granted Fidelity’s summary judgment motion and the court of appeals properly affirmed. The district court may have based its analysis on what the majority perceives to be an erroneous conclusion of law; however, the record supports the court’s decision regardless of the propriety of that conclusion. We do not issue advisory opinions on hypothetical facts; rather, we make conclusions of law regarding the facts present in a given case. The majority’s holding today is essentially an advisory opinion.1
I have one further concern with respect to the action taken by the majority. This case arises in the context of a cloud on title to real property. But Section 633 is much broader and applies to publication of an injurious falsehood that affects the vendi-bility or value of a product in any context. While the majority only addresses Section 633 in the context of a slander of title against real property, it does not so limit its holding. Consequently, to adopt this section in a case where the facts do not demonstrate that liability exists, the court, in what is an advisory opinion, adopts a new rule in a context that provides no clear boundaries for future application of the rule.
I would dismiss review of this matter as improvidently granted or, alternatively, affirm the decision of the lower court.

. The majority compounds its misunderstanding of this case by claiming that its decision is in accord with our earlier decision in Moreno v. Crookston Times Printing Co., 610 N.W.2d 321 (Minn.2000). The majority ignores the key and obvious difference between these two cases. In Crookston, we remanded after the district court misapplied the correct legal standard and the court of appeals reversed, incorrectly stating the law on the fair and accurate reporting privilege. Id. at 334. We remanded to the district court after discussing the correct legal standard and reversing the court of appeals. See id. Remand in Crook-ston was necessary after we had corrected the holding of the court of appeals, a holding binding on the lower courts of this state. In the case before us today, the court of appeals never reached the question of attorney fees as special damages. It affirmed the district court on the issue of causation, concluding as I do, that the record simply does not support Hughes’ claims that any of this litigation was caused by Fidelity’s actions. If the district court's statement of law in this matter is incorrect, it is not binding on any other court and does not compel review in the same manner. The adoption of a new rule of law should be based on facts that, if proven, support that rule. See, e.g., Lake v. Wal-Mart Stores, Inc., 582 N.W.2d 231, 235 (Minn.1998).