author: DORIS O. HUSPENI, Judge.

text:
    ZURICH REINSURANCE (UK) LIMITED, a foreign corporation, et al., Respondents (C5-99-1870), Appellants (CX-99-1878), v. CANADIAN PACIFIC LIMITED, a foreign corporation, d/b/a CP Rail System, Canadian Pacific Limited, d/b/a Soo Line Corporation, a division and subsidiary of Canadian Pacific Limited, and Soo Line Railroad Company, Appellants (C5-99-1870), Respondents (CX-99-1878).
    Nos. C5-99-1870, CX-99-1878.
    Court of Appeals of Minnesota.
    July 3, 2000.

      Jerome B. Abrams, Laurie A. Heyerdahl, Abrams & Smith, P.A., Minneapolis, MN (for appellants Zurich Reinsurance, et al.).
    John M. Sheran, Leonard, Street & Dei-nard, Minneapolis, MN (for respondents Canadian Pacific, et al.).

      Considered and decided by TOUSSAINT, Chief Judge, AMUNDSON, Judge, and HUSPENI, Judge.
   OPINION

DORIS O. HUSPENI, Judge.

Both appellants Zurich Reinsurance (UK) Limited, et al. (Zurich), and respondents Canadian Pacific Limited, et al. (Canadian Pacific), appeal from summary judgments granted against each of them in a case concerning Zurich’s obligation to indemnify Canadian Pacific for payments made in a personal injury settlement. Zurich argues the settlement is unreasonable because (1) it is excessive; (2) Canadian Pacific failed to cooperate, demonstrating bad faith; and (3) a portion of the settlement was to extinguish possible claims for punitive damages, which they contend are not covered. Zurich also argues that it should not have been sanctioned attorney fees for failure to admit. Canadian Pacific argues summary judgment against Zurich was appropriate and requests that this court reconsider the summary judgment entered against it only if the summary judgment against Zurich is reversed. We affirm..

FACTS

On February 27, 1994, 16-year-old C.Y. was horribly burned and disfigured in an explosion outside his home. A derailment of a train owned by Canadian Pacific created a butane gas leak in one of the tank cars that caught fire and caused the explosion. C.Y. and his parents and brother (the Yales) also had their home and all of their property destroyed by the explosion. After internal investigations, Canadian Pacific concluded a sudden rapture in a section of the rail caused the derailment. It was determined that failure of the railroad to properly maintain the track led to the accident. Recognizing its liability, Canadian Pacific began settlement negotiations. Initial settlement negotiations were unsuccessful, and the Yales sued Canadian Pacific in federal district court.

Canadian Pacific was self-insured for the first $7,274,000 of liability. The next $10,911,000 was insured by indemnity policies issued by Zurich (60%) and Commerce and Industry Company of Canada (40%). Another insurer covered liability in excess of $18,185,000.

As part of its policies, Zurich had the rights to “associate with [Canadian Pacific] in the defense and control of any claim,” to have access to records, and to be kept informed. Zurich and Canadian Pacific were required to cooperate in the defense of claims. The policies did not have a clause requiring Zurich’s consent before Canadian Pacific could settle a claim. The policies included punitive damages exclusions.

Several people evaluated the Yales’ case for Canadian Pacific. Estimates of possible jury verdicts for compensatory damages ranged from $15 to $27 million. Canadian Pacific also researched the possibility of punitive damages. On May 20, 1996, a day-long mediation conducted by a U.S. magistrate judge resulted in a settlement of $21,850,000, in addition to money already provided by Canadian Pacific to cover some of C.Y.’s medical costs and the Yales’ relocation costs. The total was approximately $24 million. Zurich’s representative attended at least part of this mediation.

Canadian Pacific submitted a claim to Zurich for the full amount of its insurance coverage. Zurich paid Canadian Pacific $9,238,655 in Canadian currency, the amount it believed the settlement should have been worth. It denied the rest of the claim, leaving $4.2 million unpaid. Zurich then sought a declaratory judgment that the settlement between Canadian Pacific and the Yales was unreasonable, improper, and not binding on Zurich. Zurich also asked the trial court to allocate the amount of the settlement that was compensatory in nature. Defendants alleged various counterclaims.

The trial court granted summary judgment on all claims. Canadian Pacific then moved for sanctions against Zurich under Minn. R. Civ. P. 37.03 for failure to admit that

under the terms of the Zurich policy and the C & I policy [Canadian Pacific] could enter into a reasonable settlement of claims against them without the authorizations or consent of [Zurich], without compromising any right of indemnification for the Yale claims.

The trial court ordered Zurich to pay $25,000 of Canadian Pacific’s attorney fees. The trial court also ordered Zurich to pay the outstanding amount of their policy limits and prejudgment interest. The total judgment against Zurich was $4,829,670.33. Zurich appeals the summary judgment and the sanctions. Canadian Pacific opposes Zurich’s appeal and also appeals the summary judgment on its counterclaims, asking this' court to address its summary judgment appeal only if summary judgment against Zurich is reversed.

ISSUES

I. Was Zurich entitled to the protection afforded insurers in Miller-Shu-gart settlements?

II. Did Zurich raise a genuine issue of material fact to avoid summary judgment as to whether the settlement included punitive damages?

III. Did the trial court abuse its discretion in sanctioning Zurich for failing to admit the contract did not require Canadian Pacific to get Zurich’s consent before entering into a reasonable settlement?

ANALYSIS

In reviewing an order for summary judgment, this court asks: “(1) whether there are any genuine issues of material fact and (2) whether the lower courts erred in their application of the law.” State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990) (citation omitted). We must view the record in the light most favorable to .the party opposing summary judgment. Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn.1993). To establish a genuine issue of material fact, the party resisting summary judgment must present evidence that creates more than a metaphysical doubt as to a factual issue. DLH, Inc. v. Russ, 566 N.W.2d 60, 71 (Minn.1997). The appellant cannot rest on mere averments, but must show substantial evidence of a genuine issue for trial. Id. at 69-71.

On appeal from summary judgment interpreting an insurance contract, this court asks whether the trial court erred in construing the contract. The interpretation of an insurance policy is a question of law, which this court reviews de novo. Meister v. Western Nat’l Mut. Ins. Co., 479 N.W.2d 372, 376 (Minn.1992); see also State Farm Ins. Cos. v. Seefeld, 481 N.W.2d 62, 64 (Minn.1992) (“Insurance coverage issues are questions of law for the court.”). Insurance contract exclusions must be construed narrowly against an insurance company. Hubred v. Control Data Corp., 442 N.W.2d 308, 310 (Minn. 1989).

I.

Zurich claims it is entitled to-the protection afforded insurers in Miller-Shu-gart settlements because it had’ no control over the settlement. In Miller v. Shugart, the Minnesota Supreme Court held that in third-party indemnity cases, settlements must be reasonable and prudent. Miller v. Shugart, 316 N.W.2d 729, 735 (Minn. 1982).- Zurich’s reliance on Miller-Shugart is misplaced. Insurers faced with Miller-Shugart settlements are granted equitable protection because of the possibility of collusion between the parties creating an artificially high settlement when the insured has no personal liability.

In an authentic Miller-Shugart settlement, the insurer has denied all coverage, and the abandoned insured, left on its own, agrees with the plaintiffs that judgment in a certain sum may be entered against it in return for the plaintiffs releasing the insured from any personal liability.

Buysse v. Baumann-Furrie & Co. 481 N.W.2d 27, 29 (Minn.1992).

In this case, Zurich did not deny coverage completely and did not abandon Canadian Pacific. Instead, it requested to be included and informed by Canadian Pacific about the defense strategy and settlement negotiations. ' This case also differs from a Miller-Shugart settlement because evidence shows that Canadian Pacific negotiated extensively and did not avoid personal liability. The record demonstrates negotiations that spanned months and culminated in a 10-hour settlement negotiation session with a federal magistrate. Finally, far from avoiding personal liability, Canadian Pacific was itself liable for more than $8 million under the settlement. Canadian Pacific is also required to pay a retroactive premium to its other insurer. Because this settlement does not qualify as a Miller-Shugart settlement, Zurich does not qualify for the equitable protections provided in that case.

II.

Zurich argues that summary judgment was inappropriate because questions of material fact remain concerning the reasonableness of the settlement. Zurich argues that the settlement included money to avoid punitive damages, which are not covered under the policy. Zurich also contends that the settlement award is excessive and that entering into the settlement without its agreement constituted bad faith by Canadian Pacific. There is no merit in Zurich’s claims.

First, with regard to whether sufficient facts were raised to show the settlement included money to avoid punitive damages, we generally refuse to consider “hypothetical claims that might have been made in the underlying suit.” St. Paul Fire & Marine Ins. Co. v. National Chiropractic Mut. Ins. Co., 496 N.W.2d 411, 415 (Minn.App.1993), review denied (Minn. Apr. 29, 1993); see also Safeway Stores, Inc. v. National Union Fire Ins. Co., 64 F.3d 1282, 1288 (9th Cir.1995) (considering only “claims actually settled, which are defined by the allegations in the complaint”); Caterpillar, Inc. v. Great Am. Ins. Co., 62 F.3d 955, 964 (7th Cir.1995) (“[A]n insurer may not propose theories of liability never at issue in a complaint addressing allocation.”). This court considers the circumstances and events resulting in the settlement to determine what claims were actually settled. St. Paul Fire & Marine Ins. Co., 496 N.W.2d at 415.

The Yales did not claim punitive damages, and counsel for both the Yales and Canadian Pacific indicated that the settlement was based on compensatory damages and in no way included punitive damages. In his deposition, the Yales’ counsel said there was no discussion of punitive damages during the settlement discussions. When asked about facts forming the basis for his opinion about punitive damages, he added:

That was not my conversation with the defendant. I never claimed punitive damages against the defendant. We did not settle this case based on punitive damages. We based the settlement on the basis of compensatory damages. But if the case was going to be tried, I certainly intended * * * to attempt to prove the case for punitive damages and make such a claim.

Zurich, in arguing that Canadian Pacific and its counsel considered the possibility of the Yales claiming punitive damages if the case went to trial, cites Canadian Pacific’s internal memoranda concerning punitive damages and the fact that Canadian Pacific hired outside counsel to research the issue of punitive damages. Further, as part of its argument that the settlement is excessive, Zurich concludes that the settlement amount includes money for punitive damages. But Zurich did not present any facts linking considerations of the possibility of punitive damages .to the actual settlement amount. In contrast, Canadian Pacific presented testimony and damage evaluations showing punitive damages were not á consideration in the settlement. Zurich speculates that it is possible that the Yales might have amended their complaint to include a claim for punitive damages, and that the trial court might have allowed it; therefore, argues Zurich, the settlement might include sums that reflect punitive damages. But the record does not contain facts that substantially support this speculation.

The record shows that punitive damages were never added to the complaint and testimony indicates that they were not considered in reaching the settlement. Because Zurich failed to produce substantial evidence supporting the argument that the settlement includes money for punitive damages, it has not sufficiently raised the issue of punitive damages to avoid summary judgment. See DLH, Inc., 566 N.W.2d at 69-71 (requiring substantial evidence that raises more than a hypothetical doubt about a material factual issue for trial).

Second, Zurich argues that Canadian Pacific acted in bad faith by settling the Yales’ claim despite Zurich’s rejection of the settlement terms. It is undisputed that the insurance contract lacks a clause requiring Canadian Pacific to get Zurich’s consent before settling a case. Absent such a protective clause, it is difficult to comprehend how Canadian Pacific could have been acting in bad faith by settling. Canadian Pacific knew Zurich did not agree with the settlement amount, but without a clause requiring consent, agreeing to a settlement despite an insurer’s opposition does not amount to bad faith in the absence of evidence of intent to defraud or collude. See, e.g., St. Paul Fire & Marine Ins. Co. v. Perl, 415 N.W.2d 663, 667 (Minn.1987) (upholding indemnity agreement when insurer did not incorporate language to protect itself and there was no intent to defraud). Because Zurich has not created a fact question as to whether -Canadian Pacific acted in bad faith, summary judgment was appropriate.

Furthermore, as the trial court noted numerous times, Zurich could have protected itself from its current situation by simply including in the contract a phrase requiring its consent before an insured may settle. Because Zurich did not choose to protect itself by inserting a control clause in the contract, this court will not use its equity powers- to read a reasonableness requirement into the indemnity insurance policy.

III.

Levying civil penalties is within the trial court’s discretion. State v. Alpine Air Prods., 490 N.W.2d 888, 897 (Minn.App.1992), aff'd, 500 N.W.2d 788 (Minn.1993). See also Przymus v. Commissioner of Pub. Safety, 488 N.W.2d 829, 832 (Minn.App.1992) (“The choice of sanctions under Minn. R. Civ. P. 37.02(b) for failure to comply with discovery is within the trial court’s discretion.”), review denied (Minn. Sept. 15, 1992). Absent an abuse of discretion, this court will not reverse a trial court’s award or denial of attorney fees. Becker v. Alloy Hardfacing & Eng’g Co., 401 N.W.2d 655, 661 (Minn. 1987). This court must uphold the trial court’s findings on the reasonable value of attorney fees unless they are clearly erroneous. Amerman v. Lakeland Dev. Corp., 295 Minn. 536, 537, 203 N.W.2d 400, 400-01 (1973).

The Minnesota Rules of Civil Procedure provide for sanctions against a party that “fails to admit * * * the truth of any matter as requested pursuant to Rule 36 ⅜ ⅜ * if the party requesting the admissions thereafter proves * ⅜ * the truth of any such matter.” Minn. R. Civ. P. 37.03. The sanction takes the form of paying the reasonable expenses, including attorney fees, the opposing party incurred in proving the truth of the matter. Id. There are four exceptions: (1) the request was objectionable, (2) the admission sought is not substantially important, (3) the party failing to admit reasonably believed it might prevail on the matter, or (4) the party had another good reason for failing to admit the truth of the matter. Id.

Zurich argues that it properly refused to admit that Canadian Pacific could enter into reasonable settlement of claims without authorization or consent of Zurich, without compromising any right of indemnification from Zurich, because the admission was poorly drafted and was of little overall importance. We conclude that this argument is without merit. The trial court found that the request for admission was clear and “went to the very heart of [Zurich’s] declaratory judgment suit.” The trial court also found that none of the exceptions in Minn. R. Civ. P. 37.03 applied to Zurich. These findings are supported by the record, which includes extensive argument related to the issue of Zurich’s control of the settlement and shows that Zurich did not object to the form of the admission. Zurich ultimately conceded that its insurance contracts did not contain a requirement that Canadian Pacific seek permission to settle claims. The trial court did not abuse its discretion in sanctioning Zurich.

The trial court determined that Canadian Pacific incurred fees and expenses as a result of the failure to admit because the issue was central to the case and extensively briefed. The trial court also acknowledged that

it would be virtually impossible to parse [Canadian Pacific’s] counsel’s billings to arrive at any reliable measure of the fees and expenses attributable to [Zurich’s] failure to admit.

The trial court, therefore, awarded $25,-000, which represented approximately 10% of the total billing by Canadian Pacific’s counsel between mid-March and mid-November 1998. Given the complexity involved in computing the exact amount of fees and expenses attributable to Zurich’s failure to admit, the trial court acted within its discretion in reaching the figure of $25,000.

Because we affirm the summary judgment against Zurich, we need not reach the apportionment issue or Canadian Pacific’s arguments against summary judgment on its counterclaims.

DECISION

Because Zurich is not afforded Miller-Shugart settlement protections and it did not raise a genuine issue of material fact concerning the inclusion of punitive damages in the settlement, the trial court did not err in granting summary judgment against it. The trial court did not abuse its discretion in sanctioning Zurich by imposing attorney fees or in setting the amount of the fee award.

Affirmed.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.

      . The policies are written in Canadian currency, but the trial court judgment was entered in United Slates dollars. Both parties agreed to the conversion rate and computation. Unless otherwise noted, the amounts referred to herein are in United States dollars.


source: Caselaw Access Project

author: RANDALL, Judge.

license: Public Domain

text:
    STATE of Minnesota, Respondent, v. Jesus Torres VILLALOBOS, Appellant.
    No. C9-99-1189.
    Court of Appeals of Minnesota.
    July 11, 2000.
    Review Denied Sept. 13, 2000.

      Mike Hatch, Attorney General, St. Paul and Amy Klobuchar, Hennepin County Attorney, J. Michael Richardson, Assistant County Attorney, Minneapolis, for respondent.
    John M. Stuart, Minnesota State Public Defender, Lyonel Norris, Assistant State Public Defender, Minneapolis, MN (for appellant).
    Considered and decided by LANSING, Presiding Judge, RANDALL, Judge, and WILLIS, Judge.
   OPINION

RANDALL, Judge.

Appellant challenges his conviction of second-degree unintentional murder on several grounds. He asserts that evidence obtained during a court-ordered mental examination was improperly admitted during the trial and that there is insufficient evidence to support his conviction. In his pro se brief, he challenges the validity of the arrest, asserting that it was in violation of the Vienna Convention, and he asserts that his counsel was ineffective because his counsel failed to call a particular witness. We reverse and remand.

FACTS

On October 9, 1997, appellant Jesus Torres Villalobos was at the American Indian Center in Minneapolis with several friends. Among the men in the group was Elias Solis-Holguin. Most of the men, including Villalobos and Solis-Holguin, had been drinking alcohol. Solis-Holguin was arguing with others in the group, including Villalobos.

The men left the American Indian Center and went to a nearby area known as “the jungle,” where people would go to socialize, cook, drink, and play music. Vil-lalobos was in a circle with three or four other men, and Solis-Holguin was walking around nearby. Villalobos then separated himself from the group, and he and Solis-Holguin headed toward some shrubbery. Witnesses in the area noted no sound of arguing or quarrelling between the two men until one of them was heard yelling, “No.” One witness testified that he saw Villalobos stab Solis-Holguin. Two other witnesses testified that they did not see the stabbing but saw Solis-Holguin clutching his stomach while Villalobos was standing next to him holding a knife. Solis-Holguin died of a stab wound.

Villalobos was charged with second-degree intentional murder and second-degree unintentional murder. After a jury trial in which Villalobos asserted self-defense, he was found not guilty of second-degree intentional murder but guilty of second-degree unintentional murder. He now challenges this conviction, asserting that evidence obtained during a court-ordered competency examination pursuant to Minn. R.Crim. P. 20 was improperly admitted and that there is insufficient evidence to support his conviction. Villalobos further asserts, through a pro se brief, that his arrest was improper under the Vienna Convention and that his counsel’s failure to call a particular witness constitute ineffective assistance of counsel.

ISSUES

1. Did the district court commit plain error by admitting evidence obtained during a Minn. R.Crim. P. 20 examination?

2. Did the jury have sufficient evidence to support its verdict?

3. Were appellant’s rights under the Vienna Convention violated?

4. Was appellant’s trial counsel ineffective?

ANALYSIS

I.

If the record does not reflect a specific objection to the admission of evidence, an appellate court generally will not consider a challenge to the admission of that evidence. State v. Tovar, 605 N.W.2d 717, 726 (Minn.2000); see also Bowen v. Arnold, 380 N.W.2d 531, 536 (Minn.App. 1986) (holding objection would not be considered on appeal where appellant’s attorney asked to approach bench, discussion held off the record, and no objection made on record), revieio denied (Minn. Mar. 27, 1986).

Here, no specific objection was made to the admission of the evidence in dispute. As the prosecutor began questioning Villa-lobos regarding statements made during the rule 20 examination, defense counsel asked to approach the bench. Defense counsel neither gave grounds for an objection nor did he state that he was making an objection. The conversation held at the bench was off the record. When cross-examination resumed, the prosecutor continued questioning Villalobos about his statements during the competency examination.

Absent a specific objection, this court will review a challenge to the admissibility of evidence only if the admission of such evidence was plain error. State v. Patterson, 587 N.W.2d 45, 52 (Minn.1998); see also Minn. R.Crim. P. 31.02 (stating court may consider plain errors affecting substantial rights on appeal even, if not brought to district court’s attention). To establish the existence of plain error, a three-prong test must be met: (a) there must be error, (b) the error must be plain, and (c) the error must affect substantial rights. State v. Griller, 583 N.W.2d 736, 740 (Minn.1998). If the appellate court concludes that these prongs are met, it must then determine whether addressing the error will ensure the fairness and integrity of the proceedings. Id.

We first determine whether error occurred here. Under Minn. R.Crim. P. 20, the prosecutor or defense attorney may request an examination to determine the defendant’s competency or the court may choose to order an examination on its own initiative. Minn. R.Crim. P. 20.01, subd. 2. Unless the defendant makes his or her mental condition an issue in the case, “[n]o evidence derived from the examination shall be received against the defendant.” Minn. R.Crim. P. 20.02, subd. 5.

The supreme court interpreted this rule in State v. Lefthand, 488 N.W.2d 799 (Minn.1992). In Lefthand, the defense attorney requested a mental examination of the defendant, and the examining psychiatrist found the defendant competent to stand trial. Id. at 800. Over defense objections, the district court permitted the prosecution to impeach the defendant’s testimony during cross-examination by using statements the defendant made during the rule 20 examination. Id. In reversing, the supreme court held:

.On .its face, Rule 20 precludes the use of statements made by defendants in the course of the court-ordered mental ex- . aminations upon the issue of guilt. ■ The rule reflects clear intent that such statements will only be used on the issues of sanity or competence. In addition to securing the defendant’s Fifth Amendment right against self-incrimination, it is rather obvious that a contrary rule would undercut the usefulness of the Rule 20 examination.

Id. at 801.

Here, the defense did not raise issues of mental deficiency at trial. During cross-examination, the prosecutor questioned Villalobos about his statements to the rule 20 examiner. Villalobos admitted that he lied to the examiner when he repeatedly told her that he did not remember the incident. He testified that he lied to her because he had already lied to the police and wanted to keep a consistent story.

Similar to Lefthand, it was serious error to admit this evidence. We also conclude that the error was “plain.” See United States v. Olano, 507 U.S. 725, 734, 113 S.Ct. 1770, 1777, 123 L.Ed.2d 508 (1993) (stating “ ‘[p]lain’ is synonymous with ‘clear’ or, equivalently, ‘obvious’ ” (citation omitted)). The rule iterated in Lefthand is settled and stems from specific language in the Minnesota Rules of Criminal Procedure, which state:

No evidence derived from the examination shall be received against the defendant unless the defendant has previously made his or her mental condition an issue in the case.

Minn. R.Crim. P. 20.02, subd. 5. This rule is unambiguous. The prosecutor violated this rule.

We next consider whether this error substantially impacted the jury’s verdict. This prong of the plain-error test “is satisfied if the error was prejudicial and affected the outcome of the case.” Griller, 583 N.W.2d at 741. The burden is on the defendant to establish substantial impact. Id.

It is impossible, ever, to determine the exact reason for a jury’s verdict. There is no provision in the rules to cross-examine individual jurors after a verdict as to what their thought processes and votes were on each individual issue; jury deliberations are confidential and inviolate. Here, Villa-lobos’s testimony relating to the rule 20 examination went to his credibility. Villa-lobos conceded at trial that he stabbed Solis-Holguin but asserted that he acted in self-defense. Therefore, his credibility was vital to his defense. We conclude that the jury was prejudiced by admission of the rule 20 evidence. Cf. State v. Roberts, 296 Minn. 347, 353, 208 N.W.2d 744, 747-48 (1973) (holding where case’s outcome hinged on whether jury believed defendant or victim, erroneous admission of evidence that defendant requested counsel when asked by officer whether he committed crime could have reasonably influenced verdict and was not harmless error).

Because we conclude that erroneous admission of rule 20 evidence had a substantial impact on the jury’s verdict, we also conclude that the “fairness and the integrity of the judicial proceedings” would not be ensured absent a reversal and remand for new trial. Griller, 583 N.W.2d at 740.

II.

We need not address Villalobos’s sufficiency-of-the-evidence argument or his assertion that his trial counsel was ineffective because we are reversing and remanding for a new trial. Additionally, we need not address his contention that because he was not notified of his right to contact the Mexican Consulate, his arrest violated the Vienna Convention. This issue was not raised to the district court, and Villalobos failed to present evidence, or to even make the assertion, that he is a Mexican citizen. Thus, Villalobos has waived this issue. See State v. Sorenson, 441 N.W.2d 455, 459 (Minn.1989) (declining to rule on issue because issue was not raised in district court and there was insufficient information on record to allow review); State v. Kelley, 295 N.W.2d 521, 522 (Minn.1980) (holding issues not raised at trial are deemed forfeited).

DECISION

The district court committed plain error by admitting evidence at trial that was obtained during a Minn. R.Crim. P. 20 examination. The admission was error, the error was plain, and the error was substantial. Villalobos’ due process right to a fair trial was affected.

Reversed and remanded.

      . Villalobos testified that he came to the United States from Mexico at age 13, approximately 17 years before the trial. His citizenship was not discussed at trial.


author: PETERSON, J.

text:
    STATE of Minnesota, Respondent, v. Michael John KITTRIDGE, Appellant.
    No. C2-99-1535.
    Court of Appeals of Minnesota.
    July 11, 2000.
    Review Denied Sept. 13, 2000.
    Paul D. Baertschi, Steven M. Tallen, Tallen & Baertschi, Minneapolis, MN, for respondent.
    Steven C. Wang, Schneider Law Firm, Willmar, MN, for appellant.
    Considered and decided by PETERSON, Presiding Judge, HALBROOKS, and HUSPENI, Judges.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.

   OPINION

PETERSON, J.

In this appeal from convictions of obstructing legal process and driving under the influence, appellant Michael John Kit-tridge argues that the police did not have a basis for stopping the truck he was driving. We affirm.

FACTS

Appellant Michael John Kittridge was charged with driving under the influence (DWI), obstructing legal process, illegal use of in transit plates, intent to escape tax, and driving with expired registration. Kittridge moved to suppress the evidence against him and to dismiss the charges against him, arguing that the police stop of his truck was illegal. At the Rasmussen hearing, the parties stipulated to the pertinent facts and submitted memoranda. The district court denied Kittridge’s motions.

Kittridge waived his right to a jury trial and the parties agreed that the charges of obstruction of legal process and DWI would be tried to the court based on stipulated facts pursuant to Minn.R.Crim .P. 26.01, subd. 3. The remaining charges were dismissed. The parties entered the following stipulated facts into the record:

1. On August 24, 1998, [appellant] was driving a 1990 Chevrolet pickup truck in the City of Maple Grove, Hennepin County.
2. At approximately 8:34 p.m., Officer Hendrickson of the Maple Grove Police Department observed [appellant’s] vehicle travelling westbound on Interstate 694.
3. Officer Hendrickson observed an “In Transit” plate on the rear of the vehicle and a “regular” Minnesota license plate with expired registration on the front of the vehicle.
4. The police stopped the vehicle, observed indicia of intoxication and placed the driver ( [appellant] ) under arrest for driving while intoxicated.
5. During the arrest process, [appellant] allegedly struggled with the officers, resulting in the obstructing legal process charges.

The trial court found Kittridge guilty of obstruction of legal process and DWI.

ISSUE

After observing an expired license plate displayed on the front of the truck Kit-tridge was driving, did the police have a sufficient basis to stop the truck?

ANALYSIS

Kittridge argues that the police lacked a reasonable basis to stop him. He contends that although he had a license plate with an expired tab on the front of his truck, he did not violate the traffic code because he was displaying a valid “in transit” license plate on the back of the truck as permitted under Minn.Stat. § 168.053 (1998).

Once the facts are established, whether a motor-vehicle stop was valid is a question of law. State v. Hjelmstad, 535 N.W.2d 663, 664 (Minn.App.1995). The test is not whether the trial court’s decision is clearly erroneous, but whether, as a matter of law, the basis for the stop was adequate. Berge v. Commissioner of Pub. Safety, 374 N.W.2d 730, 732 (Minn.1985).

To make a legal investigatory stop of a motor vehicle, police must have “specific and articulable facts” that establish a “reasonable suspicion” of a driving violation or criminal activity. State v. McKinley, 305 Minn. 297, 302-04, 232 N.W.2d 906, 910-11 (1975). “All that is required is that the stop be not the product of mere whim, caprice, or idle curiosity.” State v. Johnson, 392 N.W.2d 685, 687 (Minn.App. 1986) (quotation omitted). “The test is whether the officer observed sufficient objective facts to support the stop.” Shull v. Commissioner of Pub. Safety, 398 N.W.2d 11, 14 (Minn.App.1986).

Kittridge is correct that Minn.Stat. § 168.053, subd. 1, authorizes the registrar of motor vehicles to issue an annual “drive-away in transit license plate” to an applicant engaged in the business of transporting vehicles owned by another who files an application and pays a registration fee. But that statute also provides that the drive-away in transit license plate “must be carried and displayed on the power unit consistent with section 169.79.” Id.

MinmStat. § 169.79 (1998) provides:

No person shall operate, drive or park a motor vehicle on any highway unless the vehicle is registered in accordance with the laws of this state and has the number plates for the current year only * * * conspicuously displayed thereon in a manner that the view of any plate is not obstructed. * * * If the vehicle is a * * * vehicle displaying a dealer plate, one plate shall be displayed on the rear thereof * * *.

(Emphasis added.)

The emphasized language in section 169.79 plainly states that the only number plates that are to be displayed on a motor vehicle are the number plates for the current year. The number plate displayed on the front of the truck Kittridge was driving was not a plate for the current year.

Kittridge argues that construing Minn.Stat. § 169.79 to prohibit displaying on the front of a motor vehicle a license plate that is not current while a current drive-away in transit license plate is displayed on the rear of the vehicle is inconsistent with Minn.Stat. § 168.053. In making this argument, Kittridge acknowledges that Minn.Stat. § 169.79 does not mention in transit plates, but, nevertheless, argues that a vehicle using a drive-away in transit license plate is only required to display one license plate on the rear of the vehicle.

Even if we assume that a vehicle using a drive-away in transit license plate is only required to display one license plate, we conclude that Minn.Stat. § 169.79 and Minn.Stat. § 168.053 are consistent. A person driving a motor vehicle with a current drive-away in transit license plate as permitted by Minn.Stat. § 168 .053 can easily comply with both statutes. All that must be done to satisfy the requirement in Minn.Stat. § 169.79 that number plates for the current year only be displayed on the vehicle is to remove from the vehicle any number plates that are not for the current year.

DECISION

Because Kittridge violated Minn.Stat. § 169.79 by displaying an expired license plate on the front of the truck he was driving, the police had a reasonable suspicion of a driving violation, which was a sufficient basis for stopping the truck.

Affirmed.

      . The facts to which the parties stipulated are stated in the order the district court issued following the Rasmussen hearing.

      . Minn.Stat. § 169.79 requires a vehicle displaying a dealer plate to display one plate, which is to be displayed on the rear of the vehicle. Kittridge does not cite any authority for his argument that the dealer-plate provision applies to drive-away in transit plates. But the state does not dispute Kittridge's claim that a vehicle displaying a drive-away in transit plate is required to display just one plate, which is to be displayed on the rear of the vehicle.


author: G. BARRY ANDERSON, Judge

text:
    Janet JOHNSON, Respondent, v. AMERICAR RENTAL SYSTEMS, d/b/a Host Rent-A-Car, Inc., Appellant, Wade Mitchell Boe, et al., Defendants, Robyn J. Kuzara, Special Administrator of the Estate of Franklin Ralph Johnson, deceased, Respondent, American Family Mutual Insurance Company, Respondent.
    No. C0-99-2151.
    Court of Appeals of Minnesota.
    July 11, 2000.

      Gary L. Phleger, Wayzata (for respondent Janet Johnson).
    Scott P. Drawe, Stich, Angelí, Kreidler, Brownson & Ballou PA, Minneapolis (for appellant).
    Thomas Leo Garrity, Minneapolis (for respondent Wade Boe).
    Mark J. Condon, Chadwick, Johnson & Bridell, Minneapolis (for respondent City of Eden Prarire).
    Toni A. Beitz, Assistant County Attorney, Minneapolis (for respondent County of Hennepin).
    Ann Fitzgibbons, Eden Prairie (for respondent Robyn J. Kuzara).

      William M. Hart, Minneapolis (for respondent American Family Mutual Ins. Co.).
    Considered and decided by CRIPPEN, Presiding Judge, AMUNDSON, Judge, and ANDERSON, Judge.
   OPINION

G. BARRY ANDERSON, Judge

Appellant Americar Rental Systems (“Americar”) owned a rental car involved in an accident that injured respondent Janet Johnson. The district court found by way of summary judgment that Americar was liable for $125,000 of Johnson’s damages.

On appeal, Americar claims that its vicarious liability as an owner of the vehicle is limited to $105,000 as a result of the provisions of Minn.Stat. § 65B.49, subd. 5a(i)(2) (1996), and this exposure has been satisfied as a result of payments made by an insurer covering the driver.

We conclude that Americar is entitled to limited vicarious liability, but hold that payments from sources other than itself or its insurer do not satisfy this vicarious liability exposure. Accordingly, we modify the judgment against Americar to $105,-000.

FACTS

On November 2, 1996, respondent Janet Johnson was a passenger in a rental ear owned by appellant Americar and driven by her husband. Her husband ran a stop sign and collided with another vehicle. Johnson was injured and her husband died. On December 1, 1997, Johnson began an action against her husband’s estate, Americar and other parties.

At the time of the accident, Americar had an insurance policy in force from National Casualty Company which covered the rental car involved in the accident. The bodily injury liability limit on that policy was $1,000,000. The policy also purported to limit liability coverage on a “split limits” basis of $30,000 per person/$60,000 per occurrence in the event that a renter was driving the insured vehicle at the time of the accident. Johnson’s husband, the driver of the vehicle, was separately insured with American Family Insurance Company. The American Family policy had bodily injury liability limits of $100,000 per person/$300,000 per occurrence.

After litigation removed a number of parties from the case, the remaining defendants were Americar and the husband’s estate. The parties stipulated that husband was at fault and that Janet Johnson’s damages totaled $225,000.

On July 1, 1998, Americar moved for summary judgment, claiming that its vicarious liability, as owner of. the rental car, was capped at $105,000 under Minn.Stat. § 65B.49, subd. 5a(i)(2) (1996). The district court ruled that Americar did not meet the requirements of the statute, and, therefore, had unlimited vicarious liability. More specifically, the court ruled that, because Americar had- attempted to limit liability coverage provided to its renters to $30,000, it had not satisfied the requirements of the vicarious-liability-cap-statute, Minn.Stat. § 65B.49, subd. 5a(i)(2).

Americar and Johnson later filed cross-motions for summary judgment to determine the relative liability of the parties. The district court awarded Johnson $225,000, payable as follows:

Americar, through its insurer National Casualty, is responsible for the first $30,000.00 of the $225,000.00 in damages; American Family is' responsible for the next $100,000.00; the vicarious liability coverage of Americar is responsible for the final $95,000.00 of damages.

Americar appeals from the summary judgment.

. ISSUES

I. Did Americar meet the requirements of the vicarious-liability-cap-statute by purchasing a $1,000,000 liability policy covering its ownership risks?

II. Can this vicarious liability exposure be satisfied through payments from other sources?

ANALYSIS

In reviewing summary judgment, this court must determine whether any genuine issues of material fact exist and whether the district court erred in applying the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990). Because the facts of this case are undisputed and the issue on appeal involves statutory interpretation, this court must conduct a de novo review of the district court’s determinations. Hertz Corp. v. State Farm Mut. Ins. Co., 573 N.W.2d 686, 688 (Minn.1998).

I.

Americar claims that its vicarious liability as owner of the rental car is capped. Generally, the owner of an automobile is vicariously liable for the acts of a permissive user. See Minn.Stat. § 170.54 (1996) (in an accident, a permissive operator shall “be deemed the agent of the owner of such motor vehicle”). The purpose of this provision is to make the owner liable to those injured where no such liability would otherwise exist, giving an injured person more certainty of recovery by encouraging owners to obtain appropriate liability coverage. Shuck v. Means, 302 Minn. 93, 226 N.W.2d 285, 287 (1974). In 1995, the legislature chose to limit the vicarious liability of rental car companies in certain circumstances by amending the No-Fault Act as follows:

Notwithstanding section 170.54, an owner of a rented motor vehicle is not vicariously liable for legal damages resulting from the operation of the rented motor vehicle in an amount greater than $100,000 because of bodily injury to one person in any one accident and, subject to the limit for one person, $300,000 because of injury to two or more persons in any one accident, and $50,000 because of injury to or destruction of property of others in any one accident, if the oumer of the rented motor vehicle has in effect, at the time of the accident, a policy of insurance ⅜ * ⅜ covering losses up to at least the amounts set forth in this paragraph.

Minn.Stat. § 65B.49, subd. 5a(i)(2) (1996) (emphasis added); 1995 Minn. Laws ch. 225, § 1. In short, in exchange for maintaining a certain level of liability coverage, vicarious liability of the rental car company, as owner of the vehicle, is capped. This vicarious liability cap is to be adjusted for inflation; the parties agree, for this case, that the applicable cap amount for bodily injury to one person is $105,000. See Minn.Stat. § 65B.49, subd. 5a(i)(3) (1996).

The district court ruled that Ameri-car did not meet the statutory requirements because the National Casualty policy purported to limit bodily injury liability coverage to renters to $30,000 per person/$60,000 per occurrence, the minimum limits required by law. Americar argues, however, that it complied with the statutory requirements because it maintained liability coverage as the owner up to a maximum of $1,000,000.

In interpreting a statute that is unambiguous, effect must be given to its plain meaning. Tuma v. Commissioner of Econ. Sec., 386 N.W.2d 702, 706 (Minn. 1986). In this case, the district court’s interpretation of the statute does not fit with a plain reading of the statutory language. Minn.Stat. § 65B.49, subd. 5a(i)(2) requires only that the “owner” maintain a certain level of liability coverage. Here, Americar had a liability policy covering its ownership risks, among other things, up to $1,000,000.

The attempt by National Casualty to “split limits” by claiming that the permissive user (the renter) has only $30,000 as the first layer of coverage does not affect the $1,000,000 coverage provided to Ameri-car as “owner,” nor does it alter the plain requirements of the cap statute. We conclude that Americar met the statutory requirements by maintaining its $1,000,000 liability policy, and, thus, the limit on vicarious liability applies.

II.

Americar further claims that amounts paid by American Family, the personal insurer for the driver, satisfy its limited vicarious liability exposure. Amer-icar essentially argues that the purpose of the vicarious liability cap statute is to ensure that an injured party has at least $105,000 in available liability coverage, and where, as here, another insurer has paid amounts exceeding the $105,000, Ameri-car’s vicarious liability exposure has been satisfied.

Americar cites Agency Rent-A-Car, Inc. v. American Family Mut. Auto. Ins. Co., 519 N.W.2d 483 (Minn.App.1994), in support of its position:

[Respondent has never attempted to disavow its vicarious tort liability under Minn.Stat. § 170.54. The issue in dispute is not whether respondent could excuse itself from tort liability, but rather how much of that liability had to be satisfied by respondent’s admitted primary insurance obligation, and how much of the remaining liability had to be satisfied by excess insurance obligors.

Id. at 487. Americar argues that this language stands for the proposition that its limited vicarious liability exposure can be “satisfied” by payments from other insurance obligors.

Americar’s reliance on Agency is misplaced. Agency does not purport to define how the vicarious liability obligations of a rental car company are satisfied. The language relied upon by appellant simply recognizes that both an owner and a permissive user may have insurance coverage that will satisfy their joint liability to the injured party. But it is elementary and beyond dispute that these obligations are based upon entirely different legal concepts - the owner’s vicarious fault, and the driver’s active fault.

We conclude that Americar’s argument, clever though it may be, is ultimately unpersuasive. Its interpretation of the statute is contrary to the plain meaning of the statutory language and the intent of the No-Fault Act. Minn.Stat. § 65B.49, subd. 5a(i)(2), limits vicarious liability of rental car companies. The payments from American Family were based upon the active fault of the driver, not vicarious liability. It requires a strained reading of the statute, and the use of a rather amorphous application of joint and several liability, to reach the interpretation sought by Ameri-car.

Americar’s interpretation is not likely the one sought by the legislature. Under Americar’s construction of the statute, an accident victim could remain uncompensated for injuries. At the same time, a portion of the insurance policy mandated by the legislature in order to obtain the benefit of limited liability would remain unused. In order to take advantage of the limited liability provision, Americar needed at least $105,000 bodily injury insurance. Although Johnson has injuries exceeding the first $130,000 paid, Americar’s interpretation would require those injuries go uncompensated, leaving insurance required by law untouched. This could hardly have been the intent of the legislature.

Since Americar, on behalf of the lessee, concedes it owes $30,000, we conclude it is responsible for another $75,000 for a total of $105,000, as required by law.

DECISION

The district court erred by determining that Americar had not met the statutory requirements for limited vicarious liability. We hold that Americar’s liability in the present case is limited to $105,000. Accordingly, we reverse in part and modify the judgment.

Reversed in part, affirmed in part as modified.

      . On appeal, the parties do not dispute that National Casualty is responsible for the first $30,000 of the stipulated damages, and that American Family is responsible for the next $100,000. Neither party challenged the validity of the "split limits” provision in the National Casualty policy. But we question whether this "split limit” attempt plays any role in the determination of which policy pays first. In Hertz Corp. v. State Farm Mut. Ins. Co., 573 N.W.2d 686, 691 (Minn. 1998), the Minnesota Supreme Court held that the no-fault act (§ 65B.49, subd. 3(3)(d)) makes the policy covering the "owner” primary. This rule would seem to trigger coverage of all policies and their respective liability limits which cover such "ownership” risks. We question whether National Casualty can “shield” itself from its full primary obligations by creating a sub-policy covering its ownership risks when a renter is operating the rental car (yet still maintain it has an additional $970,000 in coverage for the very same ownership risks).


author: PETERSON, Judge

text:
    James MANSON, on behalf of himself and all others similarly situated, Appellant, v. STATE of Minnesota, DEPARTMENT OF EMPLOYEE RELATIONS, Respondent.
    No. C2-99-2166.
    Court of Appeals of Minnesota.
    July 11, 2000.
    Garrett D. Blanchfield, Jr., Jeffrey R. Anderson, Reinhardt & Anderson, St. Paul; and Robert A. Manson, Roseville (for appellant).
    Mike Hatch, Attorney General, Cassandra O. O’Hern, Assistant Attorney General, St. Paul, (for respondent).

      Considered and decided by DAVIES, Presiding Judge, PETERSON, Judge, and HALBROOKS, Judge.
   OPINION

PETERSON, Judge

Appellant argues that the district court erred when it determined that the Minnesota Department of Employee Relations did not violate the Minnesota Government Data Practices Act when it gave his social security number to an employee union. We reverse and remand.

FACTS

Appellant James Manson is an employee of the Minnesota Department of Revenue. Since 1989, Manson has been a member of a unit of employees that has been represented by the Minnesota Association of Professional Employees (MAPE). Respondent Minnesota Department of Employee Relations (DOER) is required by Minn.Stat. § 179A.06, subd. 3 (1998), to provide MAPE with a list of all employees in the unit represented by MAPE.

DOER identified Manson as one of the unit members and gave MAPE his name, address, telephone number, and social security number. When Manson was asked to supply his social security number, he was not informed that the number would be given to MAPE.

Manson brought suit against DOER, alleging that the release of state employee social security numbers to employee unions violated the Minnesota Government Data Practices Act. DOER moved to dismiss Manson’s complaint for failure to state a claim upon which relief can be granted. The district court determined that releasing Manson’s social security number was necessary because the social security number was the only data DOER possessed that differentiated Manson from all other employees. Based on this determination, the district court concluded that DOER did not violate the Government Data Practices Act and granted the motion to dismiss.

ISSUE

Did the district court err by determining that dissemination of Manson’s social security number was necessary?

ANALYSIS

In reviewing cases dismissed for failure to state a claim on which relief can be granted, “[t]he only question before us is whether the complaint sets forth a legally sufficient claim for relief. It is immaterial to our consideration here whether or not the plaintiff can prove the facts alleged.”

Elzie v. Commissioner of Pub. Safety, 298 N.W.2d 29, 32 (Minn.1980) (quoting Royal Realty Co. v. Levin, 244 Minn. 288, 290, 69 N.W.2d 667, 670 (1955) (emphasis in Elzie )). Statutory construction is a question of law, which this court reviews de novo. Sorenson v. St. Paul Ramsey Med. Ctr., 457 N.W.2d 188, 190 (Minn.1990).

The Minnesota Government Data Practices Act “regulates the collection, creation, storage, maintenance, dissemination, and access to government data in state agencies, statewide systems, and political subdivisions.” Minn.Stat. § 13.01, subd. 3 (1998). Under the Data Practices Act,

[a]n individual asked to supply private * * * data concerning the individual shall be informed of: (a) the purpose and intended use of the requested data within the collecting state agency * * ⅝; (b) whether the individual may refuse or is legally required to supply the requested data; (c) any known consequence arising from supplying or refusing to supply private * * * data; and (d) the identity of other persons or entities authorized by state or federal law to receive the data.

Minn.Stat. § 13.04, subd. 2 (1998). Private data on an individual shall not be disseminated by a state agency “for any purposes other than those stated to the individual at the time of collection.” Minn. Stat. § 13.05, subd. 4 (1998).

The social security numbers of individuals collected or maintained by a state agency * * * are private data on individuals, except to the extent that access to the social security number is specifically authorized by law.

Minn.Stat. § 13.49, subd. 1 (1998) (emphasis added).

Under Minn.Stat. § 13.49, subd. 1, Manson’s social security number is private data on an individual unless there is a law that specifically authorizes access to the social security number. And under Minn.Stat. § 13.05, subd. 4, if the social security number is private data on an individual, the number shall not be disseminated for any purpose other than those stated to Manson at the time he supplied the number.

It is undisputed that when Manson was asked to supply his social security number, he was not informed that the number would be given to MAPE. But DOER contends that because Minn.Stat. § 13.43, subd. 6 (1998), specifically authorizes access to Manson’s social security number, the number is not private data on an individual, and it was not necessary to inform Manson when he supplied his social security number that the number would be released to MAPE. Therefore, DOER concludes, Manson did not state a claim upon which relief can be granted.

Minn.Stat. § 13.43, subd. 6, provides:

Personnel data may be disseminated to labor organizations to the extent that the responsible authority determines that the dissemination is necessary to conduct elections, notify employees of fair share fee assessments, and implement the provisions of chapters 179 and 179A.

(Emphasis added.)

DOER argues that, as the responsible authority with respect to data disseminated to labor organizations, it has discretion to determine what information is necessary to conduct elections, notify employees of fair share fee assessments, and implement the provisions of chapters 179 and 179A. DOER contends that because it was necessary to give social security numbers to MAPE to implement the provisions of Minn.Stat. Ch. 179A, giving MAPE Manson’s social security number did not violate Minn.Stat. § 13.49, subd. 1.

The district court was persuaded by this argument. It found that

[t]he information required by the union is of the payroll type and requires the essential differentiation of plaintiff from all other[s] in the membership. The only item that differentiates people of common names is their Social Security number. True, their dates of birth could be a differentiation factor in most cases, however, there are people with the same names who have the same dates of birth. No one has the same Social Security number. Under, this common sense resolution, the “Tennes-sen warning” is not required.

This finding indicates that the district court determined that dissemination of social security numbers to MAPE was necessary. But Minn.Stat. § 13.43, subd. 6, does not provide that personnel data may be disseminated to labor organizations if a court determines that dissemination is necessary to implement the provisions of chapter 179 or 179A. The statute provides that “[pjersonnel data may be disseminated to labor organizations to the extent that the responsible authority determines that the dissemination is necessary.” Minn.

Stat. § 13.43, subd. 6. Consequently, if the responsible authority has not determined that dissemination of Manson’s social security number to MAPE is necessary to conduct elections, notify employees of fair share fee assessments, and implement the provisions of chapters 179 and 179A, Minn. Stat. § 13.43, subd. 6, does not permit dissemination of the number. The district court improperly based its decision on its own determination that dissemination of Manson’s social security number was necessary.

DOER argues that, as the responsible authority, it did determine that it was necessary to give social security numbers to MAPE to implement the provisions of Minn.Stat. Ch. 179A. But this argument, which is essentially a claim that there is a factual basis for determining that DOER’s dissemination of the social security numbers was specifically authorized by Minn. Stat. § 13.43, subd. 6, is premature. All that was necessary for Manson to defeat the motion to dismiss for failure to state a claim upon which relief can be granted was that his complaint set forth a legally sufficient claim for relief. Manson alleged that DOER released social security numbers to MAPE in violation of Minn.Stat. § 13.49, subd. 1. It is immaterial at this stage whether Manson can prove the factual basis for his claim.

DECISION

Minn.Stat. § 13.43, subd. 6 (1998), provides that personnel data may be disseminated to labor organizations to the extent that the responsible authority determines that the dissemination is necessary. Therefore, the district court improperly granted the motion to dismiss for failure to state a claim upon which relief can be granted based on its own determination that dissemination of Manson’s social security number was necessary.

Reversed and remanded.

      . The notice that an agency is required to provide an individual asked to supply private data concerning the individual is commonly referred to as a Tennessen warning.

      . The parties do not dispute that Manson’s social security number is personnel data. See Minn.Stat. § 13.43, subd. 1 (1998) (personnel data includes "data on individuals collected because the individual is or was [a state employee]”).


author: DANIEL F. FOLEY, Judge

text:
    PROGRESSIVE SPECIALTY INSURANCE COMPANY, Appellant, v. Kelly June WIDNESS, By and Through her parent and natural guardian, Sheila WIDNESS, Respondent, Adonna Ermal Enyart, by and through her parents and natural guardians, Gordon and Dixie Enyart, Respondent, Melissa Beth Baardsen, et al., Defendants.
    No. C7-00-33.
    Court of Appeals of Minnesota.
    July 11, 2000.

      Scott A. Brehm, Scott A. Brehm <& Associates, Minneapolis (for appellant).
    H. Patrick Weir, Jr., Leland F. Hagen, Lee Hagen Law Office, Ltd., Fargo (for respondent Kelly June Widness).
    John A. Hatling, Hatling Law Office, Fergus Falls (for respondent Adonna Er-mal Enyart).
    Considered and decided by KALITOWSKI, Presiding Judge, KLAPHAKE, Judge, and FOLEY, Judge.
   OPINION

DANIEL F. FOLEY, Judge

Appellant Progressive Specialty Insurance Company appeals from the district court decision determining it must provide liability coverage to a resident relative of the named insured, where the resident relative was driving a non-owned vehicle with permission. We affirm.

FACTS

On August 8, 1994, 16-year-old respondent Adonna Enyart was driving a car owned by Melissa Baardsen. Enyart was carrying several passengers, including Kelly Widness, when she was involved in a one-car accident. Respondent Widness sued the driver (Enyart) and the owner (Baardsen) for her injuries, but Baardseri’s car was uninsured.

Enyart resided with her mother at the time of the accident. Progressive had issued an automobile policy to the mother as named insured. Progressive refused to defend and indemnify Enyart in the accident, claiming that under the terms of its policy, resident relatives of the named insured were not afforded liability coverage while driving a non-owned vehicle. Progressive sought a declaratory judgment determining that it had no duty to defend and indemnify Enyart. The district court ruled that the Progressive provisions violated the no-fault act, and Progressive must provide liability coverage to Enyart. Progressive appeals.

ISSUE

Must an insurer provide residual liability coverage to resident relatives, as defined under Minn.Stat. § 65B.43, subd. 5 (1994), driving a non-owned vehicle with the owner’s permission?

ANALYSIS

In reviewing a summary judgment, the appellate court will address whether there are genuine issues of material fact and whether the district court erred in applying the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990). The facts in this case are undisputed, and the issue of whether coverage exists is a question of law. See Fallon McElligott, Inc. v. Seaboard Sur. Co., 607 N.W.2d 801, 803 (Minn.App.2000) (stating that interpretation of insurance policy is question of law).

Appellate courts apply the general principles of contract interpretation to insurance policies. Lobeck v. State Farm Mid. Auto. Ins. Co., 582 N.W.2d 246, 249 (Minn.1998). If the contract is clear and unambiguous, the language is given its usual meaning. Id. The policy must be construed as a whole. Auto-Owners Ins. Co. v. Evergreen, Inc., 608 N.W.2d 900, 908 (Minn.App.2000).

The coverage provided by the insurance policy must comply with the provisions of the Minnesota No-Fault Automobile Insurance Act, regardless of whether the contract provides otherwise. Minn.Stat. § 65B.49, subd. 8 (1994). In recognition of this requirement, the policy here provides that if any of its terms conflict with the statute, they will be amended to conform. Thus, the contract between the parties will govern an insurer’s liability “only as long as coverage required by law is not omitted and policy provisions do not contravene applicable statutes.” Streich v. American Family Mut. Ins. Co., 358 N.W.2d 396, 399 (Minn.1984) (citation omitted).

In this case of first impression, we are asked to decide whether an insurance policy that attempts to eliminate liability coverage to a resident relative driving a non-owned vehicle falls below the coverage mandated by the no-fault act. The no-fault act requires that an owner maintain residual liability coverage. Minn.Stat. § 65B.48, subd. 1 (1994). Such liability coverage must comport with the following:

[T]he reparation obligor shall be liable to pay, on behalf of the insured, sums which the insured is legally obligated to pay as damages because of bodily injury ⅝ * * arising out of the ownership, maintenance or use of a motor vehicle

Minn.Stat. § 65B.49, subd. 3(2) (1994) (emphasis added). Under Minnesota law, “insured” includes not only the named insured, but

the following persons not identified by name as an insured while (a) residing in the same household with the named insured and (b) not identified by name in any other contract for a plan of reparation security complying with sections 65B.41 to 65B.71 as an insured:
* ⅜ * *
(3) a minor in the custody of a named insured or of a relative residing in the same household with a named insured.

Minn.Stat. § 65B.43, subd. 5 (1994) (emphasis added). Enyart, who was a minor in the custody of her mother, the named insured, resided with her mother and was not the named insured on any other policy. Thus, she fell within the statutory definition of “insured.”

Under the plain language of the statute, Progressive must extend coverage to an insured “legally obligated to pay * * * damages because of ⅜ * * use of a motor vehicle.” Minn.Stat. § 65B.49, subd. 3(2) (emphasis added). Since the Progressive provisions attempt to restrict liability coverage to its insured (Enyart) while operating a non-owned vehicle, its provisions violate the minimum coverage required under the no-fault act and are, therefore, void.

Progressive contends that its provisions do not fall short of the coverage required under section 65B.49, subdivision 3(2). First, it argues that the loss was not one it was expecting; while it had the" opportunity to accept or decline the risk of insuring the mother, it was not given the same opportunity for her daughter, who was not even listed as an “additional driver” on the policy. It contends it was unable to charge a premium for Enyart, particularly for her use of a non-owned vehicle not insured by Progressive. Progressive’s own policy, however, explicitly provides coverage for minors in the custody of the named insured while driving the named insured’s car. Consequently, Progressive was able to take this into account in setting its premiums.

Progressive further claims that the no-fault act requires residual liability only as to each insured vehicle and that it does not mandate portable residual liability coverage when the insured drives another non-owned vehicle. Mutual Serv. Cas. Ins. Co. v. VanDoren, 424 N.W.2d 791, 795 (Minn. App.1988), review denied (Minn. July 28, 1988). Progressive contends that third-party benefits “liability coverage follows the vehicle and not the person.” Lobeck, 582 N.W.2d at 250 (citing Hilden v. Iowa Nat’l. Mut. Ins. Co., 365 N.W.2d 765, 769 (Minn.1985)). It asserts that coverage of non-owned vehicles “is inserted in automobile liability insurance as a convenience to the insured” and may be restricted “to prevent the insured from driving any number of additional automobiles and claiming coverage for all of them.” Boedigheimer v. Taylor, 287 Minn. 323, 329, 178 N.W.2d 610, 614 (1970).

The cited cases are distinguishable. In VanDoren, the named insured sought and was denied residual coverage for an accident in a “non-owned car” that was owned by a relative and that he used regularly. 424 N.W.2d at 792. The court denied coverage based on the policy of “preventing coverage of two or more automobiles when only a single automobile was insured.” Id. at 794 (citing Boedigheimer, 287 Minn. at 328, 178 N.W.2d at 613). -But that is not the situation here. Enyart is not seeking coverage for another vehicle that she drove regularly and that was owned but not insured by her mother. In Lobeck, the court upheld an exclusion in a policy that involved third-party benefits for the operation of non-owned vehicles used without the permission of the owner. 582 N.W.2d at 249-51. Here, Enyart drove the non-owned vehicle with permission.

Minn.Stat. § 65B.49, subd. 3(2), requires residual coverage for the insured for the use of “a” motor vehicle and does not limit coverage to the use of the named insured’s vehicle. Under the plain language of the statute, and consistent with the purposes of the no-fault act, we agree with the district court that Progressive’s policy must provide coverage here.

DECISION

The decision of the district court determining that Enyart was insured under her mothers policy while driving a non-owned vehicle with permission is affirmed.

Affirmed.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.


author: KLAPHAKE, Judge

text:
    John Willard HINCE, et al., Appellants, v. Michael O’KEEFE, Commissioner of the Department of Human Services, et al., Respondents.
    No. C0-00-49.
    Court of Appeals of Minnesota.
    July 11, 2000.
    Review Granted Sept. 13, 2000.

      Warren J. Maas, Brooklyn Park, (for appellants).
    Mike Hatch, Attorney General, Noah A. Cashman, Assistant Attorney General, St. Paul (for respondents).
    Considered and decided by KLAPHAKE, Presiding Judge, SCHUMACHER, Judge, and PORITSKY, Judge.

       Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const, art. VI, § 10.

   OPINION

KLAPHAKE, Judge

Appellants, 28 individuals who have been civilly committed to the Minnesota Sex Offender Program (MSOP) for an indeterminate period as sexual psychopathic personalities (SPPs), sexually dangerous persons (SDPs), or both, challenge the district court’s decision to dismiss their action for declaratory relief. Appellants sought a declaration that Minn.Stat. § 253B.22, subd. 1 (1998), requires the Commissioner of Human Services (the commissioner) to establish review boards at the two secure facilities where those committed to the MSOP are placed. We disagree and affirm.

FACTS

In 1971, the legislature authorized the commissioner to develop regional centers for the care of those committed as mentally ill, mentally retarded, or chemically dependent. 1971 Minn. Laws ch. 961, § 19 (codified at Minn.Stat. § 245.0312 (1998)). In 1998, the legislature authorized the commissioner to establish a new secure facility in Moose Lake for those committed as SPPs or SDPs. 1993 Minn. Laws 1st Spec. Sess. ch. 1, art. 7, § 28 (codified at Minn.Stat. § 246B.02 (1998)). MSOP provides care and treatment in this facility for 100 individuals civilly committed as SPPs and SDPs. Minn.Stat. § 246B.02. MSOP has expanded and its facilities now include two wings at the security hospital in St. Peter.

Under Minn.Stat. § 253B.22, subd. 1 (1998), the commissioner is required to establish and review boards for the regional treatment centers to review the admission and retention of patients at the treatment facility and to investigate complaints. Minn.Stat. § 253B.22, subd. 4 (1998). The commissioner has not established review boards for the MSOP sites, on the grounds that they were not “regional treatment centers” at which review boards were legislatively required or authorized. Here, appellants argue that the commissioner is required to establish review boards at the MSOP sites.

ISSUES

1. Does Minn.Stat. § 253B.22, subd. 1 (1998) require the commissioner to provide a review board for secure facilities established pursuant to Minn.Stat. §§ 246B.01-.04 (1998)?

2. Does the lack of a review board violate appellants constitutional rights?

ANALYSIS

When an appellate court reviews a case dismissed for failure to state a claim on which relief can be granted, the “only question before us is whether the complaint sets forth a legally sufficient claim for relief.” Elzie v. Commissioner of Pub. Safety, 298 N.W.2d 29, 32 (Minn.1980) (emphasis citation omitted).

Questions of statutory construction are legal questions reviewed de novo by an appellate court. In re Senty-Haugen, 583 N.W.2d 266, 268 (Minn.1998). If the language of the statute is “plain and unambiguous, the court must give it its plain meaning.” Wynkoop v. Carpenter, 574 N.W.2d 422, 425 (Minn.1998) (citation omitted). If interpretation is necessary, the court should give effect to the legislature’s intent. Minn.Stat. § 645.16 (1998); Cummings v. Koehnen, 568 N.W.2d 418, 422 (Minn.1997). If ambiguous, the rules of statutory construction must be applied. Correll v. Distinctive Dental Servs., 607 N.W.2d 440, 445 (Minn.2000).

I.

The commissioner is mandated to establish a review board “for each regional center to review the admission and retention of its patients receiving services under this chapter.” Minn.Stat. § 253B.22, subd. 1 (1998). “Regional center,” or “regional treatment center,” is defined as “any state operated facility for mentally ill, mentally retarded or chemically dependent persons which is under the direct administrative authority of the commissioner.” Minn. Stat. § 253B.02, subd. 18 (1998) (emphasis added). The definition of “treatment facility” refers to a hospital, community mental health center, or other treatment provider caring for mentally ill, mentally retarded, or chemically dependent persons. Minn. Stat. § 253B.02, subd. 19 (1998).

Appellants contend that the section applies to them, requiring establishment of review boards at the MSOP facilities, because persons committed as SPPs and SDPs are “patients” under the commitment act. Minn.Stat. § 253B.02, subd. 15 (1998) (defining patient as “any person who is receiving treatment or committed-under this chapter”). Further, they argue that the legislature did not limit the functions of the review board to regional centers, but instead referred more broadly to treatment facilities, which could encompass MSOP sites. See MinmStat. § 253B.22, subd. 4 (1998).

In some respects, the legislature treats commitments as mentally ill, mentally retarded, and chemically dependent differently from commitments as SPP and SDP. See Senty-Haugen, 583 N.W.2d at 269. One important difference is that those committed as SPP and SDP must be initially committed to “a secure treatment facility or to a treatment facility willing to accept the patient under commitment.” MinmStat. § 253B.18, subd. 1 (1998); see § 253B.185, subd. 1 (1998) (generally applying provisions of section 253B.18 to SPP and SDP commitments). The term “secure treatment facility” is defined as “the Minnesota security hospital or the Minnesota sexual psychopathic personality treatment center.” MinmStat. § 253B.02, subd. 18a (1998). By contrast, persons committed as mentally ill, mentally retarded, or chemically dependent must be committed to “the least restrictive treatment program or alternative programs which can meet the patient’s treatment needs * * * [including] regional treatment center services.” MinmStat. § 253B.09, subd. 1 (1998).

Further, as the commissioner argues, the review boards primarily serve to review the admission and retention of mentally ill, mentally retarded, or chemically dependent patients. Minn.Stat. § 253B.22, subd. 1. Patients who believe commitment is no longer appropriate may report their concerns to a review board, which will then investigate and make a recommendation to the head of the treatment facility and the commissioner. Minn. Stat. § 253B.22, subd. 4. The head of a treatment facility is authorized to discharge individuals committed under these categories when the commitment period expires or when the treatment facility head determines that the person no longer needs care and treatment. MinmStat. § 253B.16, subd. 1 (1998). By contrast, patients committed as SPP and SDP are committed for an indeterminate time. MinmStat. § 253B.18, subd. 3 (1998). Both a “special review board” and the commissioner must concur before discharge is authorized. See MinmStat. § 253B.18, subds. 4c, 15 (1998).

That the legislature treats these placements differently is emphasized by the fact that it enacted a separate chapter to authorize the commissioner to establish the Minnesota Sexual Psychopathic Personality Treatment Center (MSPPTC) and to govern facilities for those committed as SPP or SDP. MinmStat. §§ 246B.01-.04 (1998). The commissioner is required to apply to the Commissioner of Health to license the MSPPTC as a “supervised living facility with applicable program licensing standards.” MinmStat. § 246B.03. Further, the commissioner was directed to adopt rules to govern the operation, maintenance, and licensure of the program at the MSPPTC or at any other facility that the commissioner operates for persons committed as a psychopathic personality. MinmStat. § 246B.04. Consistent with this directive, the commissioner promulgated such rules. Minn. R. 9515.3000-.3110 (1999). No review board is required by the applicable statute or rules.

Appellants, however, cite the following reference in the commitment act, which provides a circumstance under which a person committed as SPP or SDP should be transferred to a regional center:

If a person is committed [as SPP or SDP] after a commitment to the commissioner of corrections, the person shall first serve the sentence in a facility designated by the commissioner of corrections. After the person has served the sentence, the person shall be transferred to a regional center designated ■ by the commissioner of human services.

Minn.Stat. § 253B.185, subd. 2(b) (1998) (emphasis added.) Appellants argue that this reference shows a clear and unambiguous statement of legislative intent that the MSOP sites are considered regional centers.

The intent of this provision is to ensure that persons who are committed as SPP or SDP while serving a prison sentence complete the sentence before being transferred to a human services facility for treatment. We agree with the commissioner that the reference to “regional center” is only a vestige of an earlier statute that predated the statutory establishment of the MSOP sites as facilities for persons committed as SPP and SDP. See Minn. Stat. § 526.10, subd. 2(b) (1992) (earlier codification of statute containing reference to “regional center”).

II.

Next, appellants raise constitutional challenges. First, they claim their equal protection rights were violated when they were denied access to a review board. As the commissioner points out, appellants did not raise their equal protection claim in the lower court, so it should not be considered on appeal. See Thiele v. Stick, 425 N.W.2d 580, 582 (Minn.1988); In re Welfare of C.L.L., 310 N.W.2d 555, 557 (Minn.1981) (appellant may not raise constitutional issues for first time on appeal).

We nonetheless briefly address the issue. Because the fundamental right of liberty is involved in SPP and SDP commitments, we use a heightened degree of scrutiny. In re Blodgett, 510 N.W.2d 910, 917 (Minn.1994). This court must defer to the legislature, and the statute’s genuine and substantive distinctions must be reasonably connected to achieving the state’s legitimate purposes. In re Linehan, 557 N.W.2d 171, 186 (Minn.1996), vacated remanded on other grounds, 522 U.S. 1011, 118 S.Ct. 596, 139 L.Ed.2d 486 (1997), aff'd. as modified, 594 N.W.2d 867 (Minn. 1999), cert. denied, — U.S. -, 120 S.Ct. 587, 145 L.Ed.2d 488 (1999). As already discussed, differences exist between commitment as mentally ill, mentally retarded, or chemically dependent and commitment as SPP or SDP. These differences are justified by the increased danger posed by those committed as SPP or SDP. The failure to provide appellants a review board under Minn.Stat. § 253B.22, subd. 1, which is intended to apply to a different kind of commitment, thus does not violate equal protection.

Appellants also raise a double jeopardy argument, claiming that the denial of a review board is inherently punitive and is not related to commitment as SDP and SPP. The supreme court previously has rejected the argument that civil commitment as SPP or SDP violates double jeopardy, and appellants make no argument that would require a different result here. See In re Linehan, 594 N.W.2d 867, 872 (Minn.), cert. denied, — U.S. -, 120 S.Ct. 587, 145 L.Ed.2d 488 (1999).

DECISION

The decision of the district court dismissing the declaratory judgment action is affirmed.

Affirmed.

      . In 1997, the term “regional center” was changed to "regional treatment center” but retained the same definition. See 1997 Minn. Laws ch. 217, art. 1, § 15 (amending Minn. Slat. § 253B.02, subd. 18). Several sections, including Minn.Stat. § 253B.22, subd. 1, still use the term “regional center,” but the two terms appear to have the same meaning.


author: G. BARRY ANDERSON.

text:
    Maynard SIEVE, Trustee, Sieve Enterprises, Inc. Retirement Plan and Trust, Respondent, v. Philip C. ROSAR, Appellant.
    No. C7-00-50.
    Court of Appeals of Minnesota.
    July 11, 2000.

      Gregory Mark Miller, Gregory M. Miller and Associates, Ltd., Minneapolis, MN, respondent.
    William K Goodrich, Randall, Dehn & Goodrich, Anoka, MN, appellant.
    Considered and decided by TOUSSAINT, Chief Judge, ANDERSON and FOLEY , Judges.

       Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const, art. VI, § 10.

   OPINION

G. BARRY ANDERSON.

Appellant Philip Rosar challenges the district court’s grant of summary judgment in favor of respondent Maynard Sieve. Rosar argues that Sieve did not comply with the relevant statutes regarding redemption from a mortgage foreclosure. We agree that the district court erred by concluding that Sieve substantially complied with the requirements of the redemption statute and, therefore, we reverse. But, because the district court did not reach Sieve’s equitable estoppel claim, we remand the case to permit the court to make findings on that issue.

FACTS

In September 1997, respondent Maynard Sieve loaned $35,000 to Ronald and Darlene Lantz to purchase property in Anoka County. Prior to the Sieve loan, the property was encumbered by another mortgage held by Metco Mortgage Corporation. The Metco mortgage was later assigned to Fidelity Bank.

In 1998, the Lantzes failed to make payments on both the Fidelity and Sieve loans. Accordingly, Fidelity commenced a foreclosure action. On August 20, 1998, the Anoka County Sheriff held a public sale of the property. At the sale, appellant Philip Rosar purchased the property for $60,476.69. The Lantzes made no attempt to redeem the property.

In December 1998, Sieve recorded a notice of intent to redeem the property and served the notice of intent on Rosar. Pri- or to the commencement of Sieve’s redemption period, Sieve’s attorney had numerous discussions with Rosar and his wife. In those discussions, Sieve’s attorney notified Rosar that Sieve intended to redeem during his redemption period. The parties dispute whether the attorney informed the Rosars that Sieve planned to redeem directly with them as opposed to the sheriff.

Sieve’s redemption period ran from February 22 to March 1, 1999. On February 19, 1999, Sieve’s attorney and Rosar’s wife had a telephone discussion about the form of payment for redemption. Rosar’s wife informed the attorney that a certified check would be acceptable. The Rosars left the country for a vacation around February 22, 1999, and returned on March 1, 1999. Neither Rosar nor his wife ever informed Sieve or his attorney that they would be unavailable during the redemption period.

On February 25,1999, Sieve sent a cashier’s check in the redemption amount by courier to Rosar’s office. Gregory Meyers, who has an office in Rosar’s building, but allegedly is not an employee or agent of Rosar, signed for the envelope and eventually delivered it to Rosar when he returned from his vacation on March 2, 1999. Before and after the check was sent to Rosar, Sieve’s attorney left numerous messages with Rosar’s “assistants” seeking to arrange a time to complete the redemption. Rosar, then out of the country, did not respond.

After Sieve sent the redemption funds, he completed repairs on the property. Although the value of the repairs made by Sieve is disputed, the parties do not dispute that repairs were made.

In a letter dated March 9, 1999, Rosar first informed Sieve that he was returning the redemption funds because Sieve failed to meet the redemption requirements. On March 26, 1999, Sieve filed a summons and complaint seeking an order directing Ro-sar to accept the redemption funds. Sieve also asserted claims of unjust enrichment and misrepresentation seeking recovery of the amount due on its mortgage and the value of improvements made to the property. Both parties made motions for summary judgment. The district court granted Sieve’s motion for summary judgment and allowed Sieve to redeem with the sheriff. This appeal followed.

ISSUES

I. Did the district court err by concluding that Sieve substantially complied with the statutory requirements for redemption?

II. Can the doctrine of equitable estoppel apply for the benefit of a party who fails to comply with the redemption statute?

ANALYSIS

In reviewing summary judgment, this court must determine whether there are genuine issues of material fact and whether the district court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn.1990). The evidence must be viewed in the light most favorable to the party against whom judgment was granted. Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn.1993). Questions of law, such as questions of statutory construction, are reviewed de novo. Minneapolis Pub. Hous. Auth. v. Lor, 591 N.W.2d 700, 702 (Minn.1999).

The manner in which creditors must redeem from a mortgage foreclosure sale is set by statute:

The person desiring to redeem shall pay to the person holding the right acquired under such sale, or for that person to the sheriff who made the sale, or a successor in office, the amount required by law for such re demption, and shall produce to such person or officer:
(1) A copy of the docket of the judgment, or of the deed or mortgage, or of the record or files evidencing any other lien under which the person claims a right to redeem, certified by the officer in whose custody such docket, record, or files shall be, or the original deed or mortgage, with the certifícate of record endorsed thereon;
(2) Any assignment necessary to establish the person’s claim * ⅞ *;
(3) An affidavit of the person or the person’s agent, showing the amount then actually due on the person’s lien.

Minn.Stat. § 580.25 (1998) (emphasis added). The person redeeming must file these documents with the county recorder within 24 hours of the redemption. Id. The person or officer from whom redemption is made must complete a certificate of redemption, which also must be recorded. Minn.Stat. § 580.26 (1998). A creditor who fails to properly redeem forfeits his interest in the property. Community Ins. Agency v. Kemper, 426 N.W.2d 471, 474 (Minn.App.1988), review denied (Minn. Sept. 16,1988).

There is no dispute that Sieve did not pay the redemption funds to Rosar or the sheriff within his seven-day redemption period. Likewise, the parties do not dispute that Sieve never showed Rosar the required documents, never recorded those documents, and never filed a certificate of redemption. The district court nevertheless ruled that Sieve had sufficiently complied with the statutory requirements because he had made a “good faith attempt” to redeem and Rosar’s interest was not “materially prejudiced.”

The district court was faced with what it concluded were two conflicting lines of precedent on the extent of compliance necessary under the redemption statutes. Specifically, the district court was concerned with decisions holding that a redemptioner must strictly comply with the statute and a decision requiring only substantial compliance.

The statutory requirements for redemption have not changed since 1874 and, thus, even the earliest decisions speak to the issues involved in the present case. See Tinkcom v. Lewis, 21 Minn. 132, 134 n. 1 (Minn.1874) (setting forth the requirements for a valid redemption). Tinkcom provides one of the earliest, and perhaps best, statements on the extent of compliance required for redemption:

The right of redemption from sales upon foreclosure by advertisement is wholly the creature of the statute; and while we would construe the statute liberally in favor of the mortgagor and redeeming creditors, we cannot dispense with or repeal its positive terms. Merely formal deviations or irregularities may be overlooked; but there must be a substantial compliance with the express requirements of the statute, in order to [effect] a valid redemption.

Id. at 141.

In Moore v. Penney, 141 Minn. 454, 170 N.W. 599 (1919), the supreme court again touched on the redemption requirements. The court held that, in order to preserve his rights, a junior creditor must redeem from the next senior redeeming creditor, even if he was that senior creditor. Id. at 456, 170 N.W. at 600. Because the junior creditor in Moore had redeemed on his lien, the issue of compliance with the statute was not a question. Id. at 455, 170 N.W. at 599,. Nevertheless, the court made a statement that is central in the present dispute:

If [the creditor] elects to redeem, the statute prescribes what he must do to effect the redemption. Within a year from the date of the sale, he must give notice of his intention to redeem; and at the time of redeeming, he must produce proof of the lien under which he makes the redemption and of the amount due thereon, and must pay the amount of the claims from which he redeems. These statutory requirements are mandatory.

Id. at 456, 170 N.W. at 600, (emphasis added).

A few years later, in Rambeck v. LaBree, 156 Minn. 310, 314, 194 N.W. 643, 645 (1923), a senior creditor filed his redemption papers after the 24-hour deadline, but before the junior creditor attempted to redeem. The court, relying on Tinkcom’s substantial compliance language, held that the senior creditor’s tardiness in filing the documents did not invalidate the redemption. Id. at 315-16, 194 N.W. at 645. The court noted that the purpose of the requirement was to inform junior creditors of their redemption amount and that only these junior creditors could challenge noncompliance. Id. at 314-15, 194 N.W. at 644-45. The court held that filing the documents prior to the junior creditor’s attempted redemption, absent any showing of prejudice, constituted substantial compliance with the statute. Id. at 314, 194 N.W. at 645.

More than 50 years later, the supreme court issued the decision that is the cornerstone of Rosar’s argument. See Graybow-Daniels Co. v. Pinotti, 255 N.W.2d 405 (Minn.1977). There, a senior creditor held the first three mortgages and a junior creditor held the fourth. Id. at 406. The senior creditor failed to file notices of its intention to redeem on the second and third mortgages. Id. The junior creditor argued that the failure meant that the second and third mortgages were extinguished. Id. The supreme court, quoting and relying heavily on Moore, agreed, holding “that the redemption requirements of Minn.St. 580.24 must be strictly adhered to.” Id. at 407.

Just two years later, the supreme court decided another case in which a creditor failed to timely file a notice of intention to redeem. Remole v. Jonathan Dev. Corp., 277 N.W.2d 362 (Minn.1979). In Remole, however, the challenge was asserted by the purchaser at the foreclosure sale. Id. at 363. The court held that, absent a showing of prejudice, the purchaser had no standing to contest the late filing. Id. In so holding, the court noted that the purpose of the requirement was for the benefit on junior creditors and was not designed to benefit the purchaser. Id.

Analysis of the appellate decisions dealing with redemption leads to the conclusion that these two strains of thought are complementary rather than contradictory. Substantial compliance with the redemption requirements is all that is necessary to effect a valid redemption. While the essential elements of the statute must be strictly adhered to, failure to comply with the more formal requirements may be overlooked. Furthermore, whether a purchaser may challenge noncompliance with a particular statutory requirement depends on whether the requirement was intended for the benefit of the purchaser.

We turn now to the specific instance of noncompliance at issue in the present case — Sieve’s failure to make payment to the proper party within the time limitation. Whether a creditor may escape the statutory requirement to make timely payment to the proper person has already been decided by the supreme court. See In re Petition of Nelson, 495 N.W.2d 200 (Minn.1993). In Nelson, property was sold under a foreclosure sale. Id. at 201. The mortgagor intended to redeem, but did not get a check to his attorney until the last day of the redemption period. Id. The mortgagor’s attorney attempted to contact the purchaser’s attorney to discuss delivery, but the purchaser’s attorney did not return his call. Id. The mortgagor’s attorney mailed the check to the purchaser’s attorney and it arrived the next day, the day after the redemption period expired. Id. The purchaser refused to accept the redemption, claiming it was untimely. Id.

The Nelson court held that payment received one day after the redemption period expired was untimely. Id. at 202. The court noted that redemption is a “strict legal right” and to comply with the requirements a mortgagor must redeem within one year of the sale. Id.; see also State ex rel. Anderson v. Kerr, 51 Minn. 417, 420-21, 53 N.W. 719, 719 (1892) (holding the district court has no discretionary authority to enlarge or extend the time in which a party is allowed to redeem). Because the mortgagor’s payment was not received by the purchaser’s attorney until after the expiration of the redemption period, it was not timely. Nelson, 495 N.W.2d at 202.

The resolution of this issue by the Nelson court effectively settles the first issue in the present case. In order to comply with the statute, substantially or otherwise, the payment must be received by the proper party within the redemption period. Id. The parties do not dispute that this did not occur. Sieve did not comply with the statutory requirements.

We reject the argument that Rosar cannot complain of the tardiness because he was a purchaser and not a junior creditor. Although some of the statutory requirements are solely for the protection of junior creditors, the requirements at issue in this case must be, at least in part, for the benefit of the purchaser. The purchaser is certainly entitled to assurances that he will receive the redemption funds, either directly or through the county sheriff. The time limitation is also important to the purchaser in that it provides him a date certain when he knows the property is his. As the supreme court has noted, strict construction of the statute is necessary for predictability in real estate commerce. In re Petition of Brainerd Nat’l Bank, 383 N.W.2d 284, 289 n. 7 (Minn.1986).

The conclusion that Sieve failed to comply with the statute, however, does not resolve the case. The Nelson court addressed other potential means of overcoming a late redemption and, although the court in Nelson rejected all theories, it did not foreclose the possibility of their application under other circumstances. Nelson, 495 N.W.2d at 202-03.

The Nelson mortgagor argued that the purchaser was equitably estopped from asserting lateness because it failed to object for six days. Id. at 203. The supreme court rejected that argument because there was no showing that the mortgagor detrimentally relied on the failure to immediately object. Id. The circumstances in the present case, however, might demand a different result.

The elements of equitable estop-pel, as set forth by the supreme court, are:

1. There must be conduct — acts, language or silence — amounting to a representation or a concealment of material facts. 2. These facts must be known to the party estopped * * ⅜. 3. The truth concerning these facts must be unknown to the other party claiming the benefit of estoppel, at the time when such conduct was done, and at the time when it was acted upon by him. 4. The conduct must be done with the intention, or at least with the expectation, that it will be acted upon by the other party, or under such circumstances that it is both natural and probable that it will be so acted upon * * *. 5. The conduct must be relied upon by the other party, and, thus relying, he must be led to act upon it. 6. He must in fact act upon it in such a manner as to change his position for the worse.

Lunning v. Land O’Lakes, 303 N.W.2d 452, 457 (Minn.1980) (emphasis added) (quotation omitted); see also Thorson v. Rice County Dist. One Hosp., 437 N.W.2d 410, 414 (Minn.1989) (conduct includes not only words but also a “party’s silence or failure to act when normally action might be expected”) (emphasis added). The application of equitable estoppel is a question of fact unless only one inference can be drawn from the facts. Rice St. VFW, Post No. 3877 v. City of St. Paul, 452 N.W.2d 503, 508 (Minn.App.1990).

The district court did not reach Sieve’s equitable estoppel argument. In fact, Sieve may have two valid arguments. First, from the evidence in the record it can be inferred that Rosar and his wife, by a combination of words and silence, led Sieve’s attorney to believe that he could send the redemption funds to Rosar’s office and that completion of the redemption would be arranged. The evidence also supports an inference that the Rosars’ conduct was intended to induce, and did induce, Sieve to send the check to the office. Rosar argues that Sieve could have retrieved the check and redeemed from the sheriff, but common sense leads to a contrary conclusion. It seems highly unlikely that Meyers would have given an envelope addressed and belonging to Rosar to someone unknown to him.

Next, unlike the mortgagor in Nelson, Sieve has made an initial showing that he detrimentally relied on Rosar’s failure to make an immediate objection to Sieve’s noncompliance with the statute. More specifically, Sieve alleges that he incurred expenses in making repairs to the property.

Rosar argues that this court’s decision in First Nat’l Bank v. Pletsch, 543 N.W.2d 706 (Minn.App.1996), revieio denied (Minn. Apr. 16, 1996) precludes the application of equitable estoppel. We disagree. In Pletsch, the bank held two mortgages on the subject property. Id. at 707. The bank foreclosed on the first mortgage, but failed to redeem under the second mortgage. Id. at 708. When a junior lienholder who had acquired, unknown to the bank, a mortgage during the mortgagor’s redemption period redeemed under his mortgage, the bank’s second mortgage was extinguished. Id. The bank sought an “equitable exception” to the rule that if a person holds a lien on property and fails to redeem, that lien is extinguished when a junior lienholder redeems. Id. at 709. This court declined to create such an exception because, contrary to the bank’s assertions, there was no evidence of collusive, fraudulent or otherwise wrongful conduct. Id. at 710.

We are not asked here to create an exception to the statutory requirements. Instead, Sieve seeks to estop Rosar from asserting the defense that Sieve failed to comply with the statutory requirements. This is a significant distinction.

Because there are genuinely disputed issues concerning the application of equitable estoppel and because the decision to apply the doctrine rests within the discretion of the district court, see Dain Bosworth, Inc. v. Goetze, 374 N.W.2d 467, 471 (Minn.App.1985), we reverse and remand.

DECISION

The district court erred by granting summary judgment in favor of Sieve.

Reversed and remanded.