Court Opinion

ID: 2824169
Source: CourtListenerOpinion
Date Created: 2015-08-11 04:28:29.891448+00
Date Added: 2024-06-11T11:31:12.480094
License: Public Domain

IN THE COURT OF APPEALS OF IOWA

                                 No. 15-0061
                             Filed August 5, 2015

IN RE THE MARRIAGE OF RUSSELL JAMES MERSMAN
AND JUDYTH JOANNE MERSMAN

Upon the Petition of
RUSSELL JAMES MERSMAN,
      Petitioner-Appellee,

And Concerning
JUDYTH JOANNE MERSMAN, n/k/a JUDYTH JOANNE ALBRITTON,
     Respondent-Appellee,

And Further Concerning
JAROD J. PEDERSEN and HEATHER R. PEDERSEN,
     Appellants.
________________________________________________________________

      Appeal from the Iowa District Court for Story County, Michael J. Moon,

Judge.

      Jarod and Heather Pedersen appeal from the denial of their “motion to

enforce decree and for specific performance.” AFFIRMED.

      Donald G. Juhl, Nevada, for appellants.

      William T. Talbot of Newbrough Law Firm, L.L.P., Ames, for appellee

Judyth Mersman.

      John L. McKinney of John L. McKinney Law Office, Ames, for appellee

Russell Mersman.

      Considered by Vogel, P.J., and Potterfield and Mullins, JJ.
                                                2

POTTERFIELD, J.

          Jarod and Heather Pedersen appeal from the district court’s order granting

Russell Mersman’s and Judyth Albritton’s motions to dismiss the Pedersens’

“motion to enforce decree and for specific performance” directed to Mersman and

Albritton’s decree of dissolution. The Pedersens allege they are interested in

purchasing a property in Nevada the court’s decree awarded to Mersman and

prescribed specific requirements for its sale. The district court did not err in

granting the motions to dismiss. The general rule is that intervention “will not be

allowed after final judgment or decree has been entered.” Morse v. Morse, 77
N.W.2d 622, 628 (Iowa 1956). Any claim the Pedersens have against Mersman1

is based upon his alleged post-decree breach of a sales contract to which Judyth

Albritton was not a party.

I. Background Facts and Proceedings.

          A decree dissolving the marriage of Russell Mersman and Judyth

Mersman, now known as Judyth Albritton, was filed on October 6, 2014. The

decree provided in part:

                  5. REAL ESTATE. The parties own certain real estate that
          is divided between the parties as follows:
                  5.1. Location and Description. The real estate has a street
          address of 66785-220th Street, Nevada, Iowa, and is legally
          described as:
                  The West ½ of the SE ¼ of the SE ¼ and the SW ¼ of the
          NE ¼ of the SE ¼, all in Section 35, Township 84 North, Range 22
          West of the 5th P.M., Iowa.
          Parcel Numbers #07-35-400-405 and #07-35-400-250.
                  5.2. Title to Russell. Russell shall have as his property the
          real property described herein above subject to the terms below.
                  5.3. Payment to Judyth. Russell shall pay to Judyth for her
          interest in the property the sum of $60,000.00 as follows: Beginning

1
    Mersman has specifically waived filing a brief in this matter.
                                  3

on January 1, 2015, and continuing on a monthly basis thereafter,
$1,000.00 per month for a period of 60 months or until paid in full.
Russell may pay the balance owed in full at any time. Any amount
unpaid when due shall draw interest at the rate of 10% per annum.
Said amount is a judgment which shall constitute a lien on the real
estate.
        5.4. Mortgage and Other Expenses. Russell shall be
solely responsible for payment of mortgages, real estate taxes,
insurance, utilities, repairs or other expenses related to the property
and shall remove Judyth’s name from any debt associated with this
real estate no later than January 1, 2020. Until Judyth’s name is
removed from any such debt, Russell shall hold and save Judyth
harmless from any personal liability for said mortgage and note.
        5.5. Quit Claim Deed. Judyth shall sign a Quit Claim Deed,
prepared by counsel for Russell and approved by counsel for
Judyth, transferring Judyth’s interest to Russell upon payment in full
of the $60,000.00 amount and removal of her name from any debt
on the property.
        5.6. Sale of Real Estate. If any one of the monthly
payments required as set forth above is 10 days or more
delinquent, or if Judyth’s name has not been removed from the debt
on the real estate no later than January 1, 2020, whichever is the
first to occur, Russell shall be required to immediately list the real
estate described above to pay Judyth any amount remaining of the
$60,000.00 award, plus interest and to satisfy any remaining debt
on the property in Judyth’s name pursuant to the following terms:
        Upon the delinquency of any monthly payment required
above by at least ten days, or the failure to remove Judyth’s name
from the debt associated with this property no later than January 1,
2020, whichever is the first to occur, joint tenancy ownership of the
real estate by the parties is hereby severed and the parties shall
thereafter hold title as tenants in common. The real estate shall
immediately be listed for sale with a realtor to be chosen by
Russell. If Russell has not listed the property for sale within thirty
days of the event requiring him to do so, Judyth shall have the right
to choose the realtor and list the property for sale and Russell shall
cooperate with signing any necessary listing agreement. Russell
shall have a right to live in the house so long as he cooperates with
all recommendations of the realtor regarding the sale of the
property, including but not limited to maintaining the house in the
manner recommended for sale. Judyth shall be equally involved in
all decisions affecting the sale of the real estate. Russell shall
cooperate with the sale of the real estate and if he does not, Judyth
may return to Court to obtain approval or assistance from the Court
regarding the sale. The parties shall follow all recommendations of
the realtor regarding the listing price, sales price, terms of sale,
condition of the property during sale, etc. The Court shall retain
                                        4

      jurisdiction over the issue of the sale of the real estate until such
      time as the real estate has sold and closing has occurred.
              Upon the sale of the real estate and improvements, there
      shall first be deducted from the sale price the normal costs of sale
      including realtor commission, tax proration, abstracting, legal fees,
      transfer tax, and unpaid mortgage balances. Judyth shall be paid
      the amount remaining of the $60,000.00 owed by Russell from the
      remaining net proceeds. Judyth shall also be repaid any amount
      she has paid on the Bank of America debt referenced herein at
      paragraph 9.1.1 since April 15, 2014, minus all payments made by
      Russell since the entry of the Decree in this matter as repayment of
      said debt pursuant to the terms of section 9.1.1. Any remaining net
      equity or net loss shall belong solely to Russell, free and clear from
      any claim by Judyth. Russell shall be solely responsible for any
      loss or remaining debt upon sale and shall hold Judyth harmless
      therefrom. Russell shall be entitled to claim as a tax deduction in
      2014 any interest and taxes paid for the real estate.

      On December 16, 2014, a “motion to enforce decree and for specific

performance” was filed by “Intervenors Jarod J. Pedersen and Heather R.

Pedersen.” The motion asserted the Pedersens were “interested parties in a

parcel of real estate that forms a prominent part of the subject matter of the

above action” and asked that the court “enforce[ ] the Decree of Dissolution with

regard to disposition of the real property involved and Order[ ] Specific

Performance of a certain ‘Offer to Buy Real Estate and Acceptance.’”

      In their motion to enforce, the Pedersens asserted that on October 27,

2014, they submitted to Mersman an offer to buy the real estate in Story County,

Iowa, described as follows:

             The West One Half of the Southeast Quarter of the
             Southeast Quarter of Section 35, Township 84,
             Range 22 West of the 5th P.M. in Story County Iowa,
             also known as 66785 220th Street, Nevada, Iowa
             50201-7624 and bearing tax parcel l.D. Numbers 07-
             35-400-405 and 07-35-400-405
      with any easements and appurtenant servient estates, but subject
      to the following: a. any zoning and other ordinances; b. any
                                       5

      covenants of record; c. any easements of record for public utilities,
      and roads and highways, hereafter designated “The Real Estate.”
             2. PRICE. The purchase price shall be $180,000.00 payable
      at Seller’s Residence or such other location as designated by
      Sellers, as follows: $1,000.00 earnest money submitted with this
      Offer to be held in the Client Trust Account of John L. McKinney,
      Seller’s Attorney, and the balance of $179,000.00 payable in cash
      at the time of closing and possession. This offer is not contingent
      on Buyers’ sale of their existing residence.

The Pedersens asserted further that Mersman accepted the offer on October 31,

2014, but,

      on November 25, 2014, the undersigned attorney received a letter
      from [Mersman’s attorney] Mr. McKinney dated November 21,
      which letter stated that Russell was “rescinding” his Offer because
      Judy was the owner of one-half of the property and she refused to
      cooperate with the sale and provide a deed for her alleged “one-
      half interest.” Mr. McKinney enclosed a check on his trust account
      for $1,000.00 and stated the closing was cancelled.
               11. The same date, the undersigned attorney replied to Mr.
      McKinney by letter, FAX and e-mail, stating among other things,
      that “rescission” was not a label that could be arbitrarily pinned on
      an intentional, unilateral breach of contract by the seller, and that
      Jarod and Heather intended to proceed with the purchase. Mr.
      McKinney’s original letter along with his check for $1,000.00 was
      enclosed and returned to him.
               ....
               18. Jarod and Heather have at all times been ready, willing
      and able to complete the purchase of the real estate they
      contracted for. The cash required for full payment of the acreage is
      in their bank and ready to disburse to the lienholders and Judy.
      The Pedersens have done absolutely nothing to breach the
      Agreement.
               19. Jarod and Heather, having contracted in more than good
      faith, are third party beneficiaries to the sale contemplated in the
      Agreement between Russell and Judy and confirmed by the Court’s
      Decree. Moreover, they are entitled to Specific Performance of
      their Offer, as this property is unique and is what they contracted
      for.
               20. Pursuant to Paragraph 15(c) of the attached Offer,
      signed and agreed to by Russell [Mersman], either party is entitled
      to “utilize any and all other remedies or actions at law or in equity
      available to them and shall be entitled to obtain judgment for costs
      and attorney fees.” Specific Performance is an equitable remedy
      for the breach of a contract to sell real property.
                                         6

              21. Pursuant to the same Paragraph 15(c), Intervenors are
      entitled to an award of their attorney’s fees incurred in prosecuting
      the enforcement of the Offer.
              WHEREFORE, Jarod and Heather respectfully move the
      Court for the following Orders:
              A. For an Order setting this matter for hearing on the earliest
      available Court and Motion Day. All or nearly all of the evidence on
      behalf of the Intervenors is in written form, and in light of the fact
      that Russell will walk away debt free and Judy will obtain her entire
      $60,000.00 before it even comes due, the only reason either of
      them can truthfully give the Court for their refusal to perform is
      simply “We just changed our minds and don’t want to do it.” A one-
      half hour hearing is more than sufficient to hear the evidence.
              B. In light of Section 5.6 of the Agreement, confirmed by the
      Court’s Decree, which states “The Court shall retain jurisdiction
      over the issue of the sale of the real estate until such time as the
      real estate has sold and closing has occurred[.],” for an Order
      directing that notice of hearing be served on Russell’s counsel, Mr.
      McKinney by EDMS, and served on Judy by ordinary first class mail
      to her address of record as shown on the records of the Clerk of
      this Court. (Their dissolution was final on October 6, 2014, a little
      over two months ago.) Notice should also be sent to her e-mail
      address which is judy@*** as shown on the attached Exhibit 2.
              C. At the conclusion of the hearing requested above, for an
      Order directing counsel including Judy’s attorney, if any—to
      prepare the necessary closing documents and promptly schedule a
      closing in the office of Mr. McKinney and further, if either party
      refuses to sign the necessary documents, for an Order directing the
      Clerk of Court to execute the necessary documents of transfer
      upon presentation to the Clerk of an affidavit signed by either
      attorney that one or both parties has refused to sign the
      documents, all pursuant to Section 11 of the Agreement and the
      statutory citations to the Code of Iowa set forth therein.
              D. For an Order awarding reasonable attorney’s fees to the
      undersigned attorney for the Intervenors, to be approved by the
      Court, and for the costs of this action.
              E. For an Order directing the Clerk of Court to list this action
      in the Lis Pendens index as provided by J.C. Sec. 617.10, et seq.
      The legal description is set forth in attached Exhibit 1.

      Albritton filed a motion to dismiss, asserting “there is no evidence that

[she] was served with Original Notice or Petition in this matter”; “[p]ursuant to

Iowa Code Section 598.3, no actions may be joined with a dissolution action”;

“[t]he [Pedersens] have no standing to compel a titleholder of the real estate to
                                            7

sell their interest in real estate”; and “[a] person not party to the dissolution order

has no standing to request a court enforce a dissolution order.”

         Mersman, too, filed a motion to dismiss, stating Albritton “was given

judgment as against Respondent Mersman, in the amount of $60,000.00 as her

share of the real property jointly owned by the parties to the dissolution,” which

“judgment has not either partially or wholly been satisfied, and remains a lien

against the real property that the Intervenors are attempting to purchase.” He

maintained, “Specific performance is not a remedy that can be used to enforce a

real estate contract where the title holder cannot convey marketable title. Also,

where there is impossibility of performance, specific performance cannot lie.”

         The Pedersens filed a resistance to the motions to dismiss, asserting they

had a right to intervene in the dissolution proceeding, citing Wharff v. Wharff, 56
N.W.2d 1 (Iowa 1952).            They also contended service on Albritton was

accomplished when Mersman served her with original notice of the dissolution

“long ago” and the court retained jurisdiction over the sale of the property by

virtue of the dissolution decree language so stating.

         In regards to Mersman’s motion to dismiss the Pedersens claimed,

         This Court has the authority to enter a Decree of Specific
         Performance, require Russell to contribute the small amount of
         cash required to close this transaction, and Order both parties to
         execute the necessary closing documents as required by their own
         Settlement Agreement which became the Final Decree of the Court
         when their voluntary stipulation was approved.

         A hearing was held on January 5, 2015,2 after which the court entered an

order stating:

2
    No transcript of the proceedings was made.
                                          8

       “Intervenors” Jarod J. Pedersen and Heather R. Pedersen
       personally appeared with their attorney Donald Juhl.
              Intervenors have interjected themselves into this closed
       dissolution of marriage file in an attempt to enforce the terms and
       provisions of an agreement for the sale of real estate entered into
       by them and petitioner, Russell Mersman. They assert that by
       reason of the decree of dissolution of marriage entered herein on
       October 3, 2014, Russell Mersman is the legal title holder of certain
       property locally known and described as 66785-220th Street,
       Nevada, Story County, Iowa.
              Respondent, Judyth Albritton, has refused to cooperate with
       the intervenors in the transfer of the real estate, claiming that she is
       a joint tenant with her former husband in the ownership of the
       property and she does not wish to sell. She has not signed the real
       estate contract and apparently prefers to sell the property to other
       parties.
              Intervenors now wish to enforce the provisions of the decree
       as they interpret them and force Judyth Albritton to clear title to the
       real estate.
              Both [Mersman and Albritton] have filed motions to dismiss
       intervenors’ motion.
              A review of the file reveals that although Jarod Pedersen
       and Heather Pedersen have denominated themselves as
       intervenors in this dissolution of marriage action, they do not qualify
       as intervenors under Iowa R. Civ. P. 1.407. That rule sets forth
       when interventions may occur as a matter of right and when they
       may be granted as permissive by the court. Attempting to intervene
       into a closed case is not allowed either as a matter of right or by
       permission.
              Accordingly, the motion filed by Jarod J. Pedersen and
       Heather R. Pedersen must be dismissed.

       The Pedersens filed a motion to amend or modify the ruling pursuant to

Iowa Rule of Civil Procedure 1.904(2), asserting there was no procedural bar to

intervening in a “closed case,” disagreeing the case was “closed” in any event,

and asserting they had an interest in the property distributed in the dissolution

and thus “had an absolute right to intervene.” The court denied the motion,

finding a rule 1.904(2) motion was not available as its ruling had been “based on

legal principles alone.”
                                            9

II. Discussion.

         The Pedersens appeal, contending they qualify as intervenors of right, and

the district court erred in concluding they were barred from intervening because

the case was “closed.”

         We begin by noting the Pedersens have never filed an application to

intervene nor did they serve a motion to intervene upon the parties to the

dissolution action—both of which are required by Iowa Rule of Civil Procedure

1.407.      Rather, they filed a “motion to enforce decree and for specific

performance.” Only after Mersman’s and Albritton’s motions to dismiss were filed

did the Pedersens assert that they were entitled to intervene.

         The ability to intervene in an action is governed by Iowa Rule of Civil

Procedure 1.407. The Pedersens assert they have a right to intervene in the

post-decree dissolution action under rule 1.407(1)(b), which provides:

                 (1) Intervention of right. Upon timely application, anyone
         shall be permitted to intervene in an action under any of the
         following circumstances: . . . (b) When the applicant claims an
         interest relating to the property or transaction which is the subject of
         the action and the applicant is so situated that the disposition of the
         action may as a practical matter impair or impede the applicant’s
         ability to protect that interest, unless the applicant’s interest is
         adequately represented by existing parties.
                 ....
                 (3) Procedure. A person desiring to intervene shall serve a
         motion to intervene upon the parties. The motion shall state the
         grounds therefor and shall be accompanied by a pleading setting
         forth the claim or defense for which intervention is sought.
                 (4) Disposition. The court shall grant interventions of right
         unless the applicant’s interest is adequately represented by existing
         parties. The court shall consider applications for permissive
         intervention and grant or deny the application as the circumstances
         require. The intervenor shall have no right to delay, and shall pay
         the costs of the intervention unless the intervenor prevails.
                                         10

       Even if we quibble with the district court’s terminology that there is no right

to intervene in a “closed case,” the sentiment is a correct statement of the law. In

Morse, 77 N.W.2d at 623, persons filed a post-dissolution motion to intervene,

asserting they

       held by virtue of a deed executed, delivered and recorded; that the
       intervener or interveners held the legal title to the respective
       properties prior to the commencement of the divorce action and the
       attachment and levy therein made; and the title of the respective
       interveners is paramount to and superior to any title, lien or claim of
       the plaintiff, Belle Morse. Each of the interveners ask their claims
       be investigated, upon hearing the levy under the attachment in the
       divorce action be released and the court grant such relief as may
       seem just in the premises.

The district court, after a trial on the Morse motion to intervene, ruled it did not

have jurisdiction to determine the matter. The supreme court stated, “It is the

general rule intervention will not be allowed after final judgment or decree has

been entered.”    Morse, 77 N.W.2d at 628 (emphasis added).            However, the

Morse court held that the

       parties have sought the jurisdiction of the court and have waived
       any objection thereto, as they did in the present case, the question
       of jurisdiction cannot thereafter be successfully raised. And this
       should be equally true even where a petition of intervention is filed
       after a decree has been entered and no appeal was taken. This
       would also be the situation where cross-petitions are filed to the
       petitions of intervention and the issues raised by the respective
       parties are submitted to and tried by the court.
               By virtue of the fact the interveners by their actions have
       waived their right to question the jurisdiction of the court it is our
       holding the trial court was in error in dismissing the petitions of
       intervention and plaintiff’s cross-petitions.     Consequently we
       reverse and remand the cause for a further consideration of the
       evidence originally submitted and such other matters as may be
       later presented.

Id. (emphasis added).
                                           11

       There is no such waiver in the case before us. Neither Mersman nor

Albritton waived their objection to the Pedersens’ attempt to inject themselves in

the completed dissolution proceedings. The general rule is thus applicable—

intervention is not allowed after a decree is entered. See id.

       The Pedersens cite Wharff, 56 N.W.2d at 3-4, for support.               The case

before us, however, is in a different procedural phase. Wharff was a dissolution

action where one issue was the division of realty the parties’ held in tenancy in

common but which had been purchased with money the wife held in trust for

children by a previous marriage. Wharff, 56 N.W.2d at 2. The wife’s children

from the previous marriage moved to intervene in the dissolution action, asking to

have a trust for their benefit imposed on the realty. Id. Then-civil procedure rule

75, stated: “Any person interested in the subject matter of the litigation, or the

success of either party to the action, or against both parties, may intervene at

any time before trial begins,[3] by joining with plaintiff or defendant or claiming

adversely to both.” See id at 2-3 (emphasis added). The supreme court allowed

the intervention, noting the divorcing parties had “offered for the decision of the

court the question of the ownership of certain realty, as an incident to their

divorce suit.” Id. at 3. The court opined:

       Upon determination of a divorce suit, if a divorce be granted, it is
       the duty of the trial court to make such order as may be right
       concerning alimony, support, and division of the property of the
       parties. There seems every reason in policy why, if there are third
       parties claiming an interest in either the real or personal property,
       the entire matter should be decided at once. Such a course will do

3
  Rule 1.407(1) states, “Upon timely application, anyone shall be permitted to intervene
in an action under any of the following circumstances . . . .” The language from the
former rule suggests when an application would be “timely,” i.e., at any time before trial
begins.
                                           12

         away with a multiplicity of suits and will enable the court to make
         orders concerning property rights and allowances with a full
         knowledge of the exact extent of the interests of the litigants. In the
         case at bar, if the court is not to be permitted to know the real
         interest of the plaintiff and defendant in the realty and personalty
         now owned by them, if this must be left to determination in a future
         and separate suit brought by the proposed intervenors, it will be
         greatly hampered in making a fair order. Principles of expediency
         and of a fair administration of justice approve the determination of
         all rights in one action.

Id. at 4. The court also stated that even if the trial court found neither party was

entitled to divorce, nonetheless, “[a] trust can be impressed, or denied,

regardless of whether the interests of the plaintiff and defendant are determined.”

Id. at 5.     Those considerations are not present in the instant case.            The

Pedersens do not claim they had an interest in the property prior to entry of the

dissolution decree. Rather, they claim to be aggrieved by Russell Mersman’s

rescinding the contract for sale of the property entered into after the decree was

filed.   Wharff and the expediency considerations expressed therein are not

applicable here.

         The Pedersens claim there is support for their motion to be found in In re

Marriage of Ballstaedt, 606 N.W.2d 345 (Iowa 2000). We do not find the case

applicable. Ballstaedt involved a post-dissolution action for alimony and child

support and an income withholding order. 606 N.W.2d at 347. The “heart of the

appeal” was whether the proceeds from an installment sale entered into while the

dissolution action was pending constituted income subject to withholding. See id.

The assignee of the sellers’ rights was found to have a right to intervene in the

withholding action. See id. at 350.
                                         13

       The Pedersens contend that Mersman’s and Albritton’s motions to dismiss

“are nothing more than a thinly veiled assault upon a written, enforceable

contract to purchase real property.” This argument itself suggests the dissolution

action is not the proper vehicle for their claim. The Pedersens assert a breach-

of-contact claim against Mersman. Albritton is not party to that contract. Cf.

State ex rel. Miles v. Minar, 540 N.W.2d 462, 465 (Iowa Ct. App. 1995)

(upholding trial court’s denial of mother’s motion to intervene in an action to

establish paternity filed by the child support recovery unit against putative father

and noting “[l]itigation would not be reduced by intervention, and [mother’s]

presence in the lawsuit as a party would have done little to assist in the efficient

disposition of the case”). The Pedersens are not parties to the dissolution action,

did not have an interest in the property prior to the dissolution decree being filed,

and they have presented no support for their claim that they are third-party

beneficiaries of the decree.

       We affirm the dismissal of their motion to enforce decree and for specific

performance.

       AFFIRMED.