author: KAPSNER, Justice.

text:
    2004 ND 46
    Sefin MUHAMMED, Plaintiff and Appellant v. Ellen WELCH, Defendant and Appellee.
    No. 20030182.
    Supreme Court of North Dakota.
    Feb. 25, 2004.

      Duane A. Lillehaug (argued), and H. Patrick Weir, Jr. (on brief), Lee Hagen Law Office, Ltd., Fargo, N.D., for plaintiff and appellant.
    Jacqueline Sue Anderson (argued), and William P. Harrie (on brief), Nilles, Hansen & Davies, Ltd., Fargo, N.D., for defendant and appellee.
   KAPSNER, Justice.

[¶ 1] Sefin Muhammed appealed from a summary judgment dismissing his personal injury action against Ellen Welch arising out of an automobile accident. We conclude the district court improperly granted summary judgment because Mu-hammed has raised a genuine issue of material fact whether the defendant is equitably estopped from raising the statute of limitations as a bar to the action. We reverse and remand for further proceedings.

I

[¶ 2] On December 27, 1995, Mu-hammed was a passenger in a vehicle that was struck by Welch’s vehicle in Fargo. The next day, Carlton Goughnour, an adjuster with Noble Adjustment Company, was assigned by Welch’s insurer, Austin Mutual Insurance Company, to investigate and adjust a claim relating to the accident. After investigating the accident, Goughn-our did not anticipate any personal injury claims and closed the file in August 1996. On April 30, 1998, Welch died from unrelated causes. No probate proceedings were initiated after her death and no personal representative was appointed for her estate.

[¶ 3] In January 1999, an attorney contacted Goughnour and informed him he was representing Muhammed on a personal injury claim arising from the accident. Unaware that Welch had died, Goughnour reopened the file and initiated settlement discussions with Muhammed’s attorney. In July 2001, Muhammed’» present attorneys began representing him on the claim.

[¶ 4] On September 12, 2001, Mu-hammed sued “Ellen Welch” and a summons and complaint were served by certified mail, restricted delivery, addressed to “Ellen Welch, P.O. Box 751, Dalton, MN 56324.” Pat Welch, Ellen Welch’s widower, received and signed for the certified mail on September 13, 2001, and turned it over to his insurance agent. The insurance agent forwarded the summons and complaint to Austin Mutual and also informed the company that Ellen Welch had died. Goughnour then learned that Ellen Welch was dead.

[¶ 5] Goughnour contacted Mu-hammed’s attorney and requested an indefinite extension of time to answer the complaint in the hope that a settlement could be reached. Muhammed’s attorney granted the request. Goughnour did not tell Muhammed’s attorney Ellen Welch was dead. In September 2001, Goughnour sent Muhammed’s attorney a letter stating in part:

During our conversation, you granted an indefinite time to answer your Summons and Complaint. Summons and Complaint was filed as statute of limitations was about to run out December of this year. We further discussed our $10,000 offer to your client, at the time he was represented by Paul Johnson. This offer stands.

[¶ 6] Settlement discussions continued until March 13, 2002, when Muhammed’s attorney withdrew the indefinite extension of time to file an answer. Ellen Welch’s death was not disclosed to Muhammed’s attorney during any of the settlement negotiations. On March 27, 2002, the day the statute of limitations expired, an answer was interposed on behalf of “Defendant Ellen Welch,” stating in part that “Defendant Ellen Welch” demanded a trial by a jury of nine. Her death was not disclosed in the answer. On April 10, 2002, the defense served an amended answer raising insufficiency of process and service of process and lack of subject matter jurisdiction. Muhammed’s attorney was not advised of Ellen Welch’s death until May 23, 2002.

[¶ 7] In January 2003, the defendant moved for summary judgment, arguing the action should be dismissed for insufficient service of process and because it was barred by the statute of limitations. Mu-hammed argued service on Pat Welch constituted service on Ellen Welch’s estate; the defendant fraudulently concealed Ellen Welch’s death, allowing an additional year after learning of her death to bring the action under N.D.C.C. § 28-01-24; and the doctrine of equitable estoppel applied to prevent the bar of the statute of limitations. The district court rejected these arguments and granted the motion for summary judgment dismissing Mu-hammed’s claim with prejudice.

II

[¶ 8] In Weiss v. Collection Ctr., Inc., 2003 ND 128, ¶ 8, 667 N.W.2d 567 (citations omitted), we summarized our standard of review for an appeal from a summary judgment:

Summary judgment is a procedural device which promptly resolves an action on the merits without a trial if the evidence shows either party is entitled to judgment as a matter of law and no dispute exists as to either the material facts or the reasonable inferences to be drawn from undisputed facts, or if resolving the factual disputes will not change the result. If reasonable persons could reach only one conclusion from the facts, issues of fact may become issues of law. “Even undisputed facts do not justify summary judgment if reasonable differences of opinion exist as to the inferences to be drawn from those facts.” When reviewing a summary judgment, this Court views the evidence in the light most favorable to the non-moving party and gives that party the benefit of all favorable inferences which reasonably can be drawn from the evidence. We review de novo the question of law whether the trial court properly granted summary judgment.

[¶ 9] The district court dismissed Mu-hammed’s claim because “service was never made on a personal representative” of Ellen Welch’s estate and because “the statute of limitations has now run.”

A

[¶ 10] Muhammed argues the district court erred in ruling service of process on Pat Welch did not constitute proper service on Ellen Welch’s estate.

[¶ 11] Absent valid service of process, even actual knowledge of the existence of a lawsuit is insufficient to effectuate personal jurisdiction over a defendant. Kimball v. Landeis, 2002 ND 162, ¶ 20, 652 N.W.2d 330. Muhammed relies on Code v. Gaunce, 315 N.W.2d 304, 306 (N.D.1982), in which this Court held service of process was sufficient where the defendant’s daughter signed for the certified mail instead of the defendant, because “the summons and complaint were sent by mail addressed to the person to be served, Gaunce, a return receipt was requested, and there is no question that delivery resulted.” Here, Muhammed attempted service under N.D.R.Civ.P. 4(d)(2)(A)(v), which permits service by “any form of mail ... addressed to the individual to be served and requiring a signed receipt and resulting in delivery to that individual.” Unlike the situation in Gaunce, Pat Welch’s signing of the certified mail did not result in delivery to Ellen Welch, nor could it have resulted in delivery, because Ellen Welch was deceased at that time. No probate proceedings were initiated after her death, and neither Pat Welch nor anyone else was appointed personal representative of her estate. Under these circumstances, the proper procedure is for a claimant to initiate probate proceedings in order to present a claim against the estate. See N.D.C.C. § 30.1-14-01; Matter of Estate of Stirling, 537 N.W.2d 554, 558-59 (N.D.1995).

[¶ 12] Service on the decedent’s widower did not constitute service on the decedent’s estate under these circumstances. We conclude the district court did not err in ruling service was insufficient for purposes of commencing an action against Ellen Welch’s nonexistent estate.

B

[¶ 13] Muhammed argues, because his claim against Ellen Welch’s estate was fraudulently concealed, the district court erred in not allowing him an additional year after learning of her death to file the lawsuit under N.D.C.C. § 28-01-24.

[¶ 14] Section 28-01-24, N.D.C.C., provides that “[w]hen, by fraud or fraudulent concealment, a party against whom a claim for relief exists prevents the person in whose favor such claim for relief exists from obtaining knowledge thereof, the latter may commence an action within one year from the time the claim for relief is discovered by him or might have been discovered by him in the exercise of diligence.” The statute “is designed to extend the period of time within which an action, otherwise barred by the passage of time because of a statute of limitation, may be brought when one, by fraud or fraudulent concealment, has prevented another from obtaining knowledge of the existence of a cause of action.” Phoenix Assurance Co. of Canada v. Runck, 366 N.W.2d 788, 791 (N.D.1985).

[¶ 15] Here, Muhammed alleges deception in not disclosing the death of a party, not deception in the existence of the cause of action. Muhammed was aware of the cause of action, but filed the action against a nonexistent party. We conclude the district court did not err in ruling N.D.C.C. § 28-01-24 was inapplicable under the circumstances.

C

[¶ 16] Muhammed argues the district court erred in ruling the defendant was not equitably estopped from relying on the statute of limitations as a bar to the action.

[¶ 17] The court held estoppel did not apply in this case as a matter of law, because N.D.C.C. § 31-11-06 refers to a “party’s own” declaration, act or omission, and “the party against whom [Muhammed] is claiming estoppel is deceased and cannot be held to have intentionally or deliberately misled [Muhammed] into believing she was not deceased in order to avoid this lawsuit.” The court alternately held, even if estoppel did apply, Muhammed “would still need to serve Defendant’s estate with process,” and because “the statute of limitations has run on this claim, serving Defendant’s estate would be to no avail because the Complaint would not relate back to anything since the first service was a nullity.”

[¶ 18] This Court has recognized that the doctrine of equitable estoppel may preclude application of a statute of limitations as a defense by one whose actions mislead another thereby inducing that person to not file a claim within the statutory period. See Hoffner v. Johnson, 2003 ND 79, ¶¶ 25-26, 660 N.W.2d 909; Snortland v. State, 2000 ND 162, ¶ 15, 615 N.W.2d 574; Narum v. Faxx Foods, Inc., 1999 ND 45, ¶ 24, 590 N.W.2d 454; Reiger v. Wiedmer, 531 N.W.2d 308, 310 (N.D.1995); Burr v. Trinity Med. Ctr., 492 N.W.2d 904, 908 (N.D.1992); Schmidt v. Grand Forks Country Club, 460 N.W.2d 125, 129-30 (N.D.1990); Szarkowski v. Reliance Ins. Co., 404 N.W.2d 502, 507 (N.D.1987); Krueger v. St. Joseph’s Hosp., 305 N.W.2d 18, 25 (N.D.1981); Fetch v: Buehner, 200 N.W.2d 258, 261 (N.D.1972). A delay may be excusable if it is not unreasonably protracted, but is induced by the defendant’s promises, suggestions, or assurances which, • if carried into effect, would result in a solution or adjustment without litigation. Narum, 1999 ND 45, ¶ 24, 590 N.W.2d 454. In Schmidt, 460 N.W.2d at 129-30, we explained:

The reason for the rule is that “one cannot justly or equitably lull his adversary into a false sense of security, and thereby cause his adversary to subject his claim to the bar of the statute of limitations, and then be permitted to plead the very delay caused by his course of conduct as a defense to the action when brought.” Annot., Promises to settle or perform as estopping reliance on statute of limitations, 44 A.L.R.3d 482, 488 (1972). While “the mere conduct of settlement negotiations or discussions by a defendant with a-plaintiff does not alone provide a basis for estopping the defendant from pleading the statute of limitations” [Annot., Settlement negotiations as estopping reliance on statute of limitations, 39 A.L.R.3d 127, 131 (1971) ], it is sufficient if the defendant’s “ ‘conduct or promises are such as are naturally calculated to and do “induce plaintiff into a belief that his claim would be adjusted if he did not sue.” ’ ” Szarkowski v. Reliance Ins. Co., supra, 404 N.W.2d at 507 [quoting Douglass v. Douglass, 199 Okl. 519, 188 P.2d 221, 224 (1947) ].

[¶ 19] The doctrine of equitable estoppel is codified in N.D.C.C. § 31 — 11— 06, which provides that “[w]hen a party, by that party’s own declaration, act, or omission, intentionally and deliberately has led another to believe a particular thing true and to act upon such belief, that party shall not be permitted to falsify it in any litigation arising out of such declaration, act, or omission.” To successfully implement equitable estoppel under N.D.C.C. § 31-11-06, the plaintiff carries the burden of proving three elements:

First, the plaintiff must prove that the defendant made statements and “from the nature of defendant’s statements and all of the surrounding facts and circumstances that the statements were made with the idea that plaintiff would rely thereon.” ... Second, the “plaintiff must show that she relied on the representations or acts of defendant and, as a result of that reliance, she failed to commence the action within the prescribed period.” ... Lastly, “the plaintiff must show that the acts of defendant giving rise to the assertion of estoppel must have occurred before the expiration of the limitation period.”

Burr, 492 N.W.2d at 908.

[¶ 20] Additionally, the suppression of a material fact, which a party is bound in good faith to disclose, is equivalent to a false representation. Krueger, 305 N.W.2d at 25. For an estoppel to arise from silence, the silence must be accompanied by a duty to speak out, reasonable reliance on the silence, and resulting prejudice. Ray Co., Inc. v. Johnson, 325 N.W.2d 250, 254 (N.D.1982); see also Baird v. Stephan, 52 N.D. 568, 588, 204 N.W. 188, 195 (1925) (stating “[e]stoppel by silence arises where a person who by force of circumstances is under a duty to another to speak refrains from doing so and thereby leads the other to believe in the existence of a state of facts in reliance upon which he acts to his prejudice”); Branthover v. Monarch Elevator Co., 33 N.D. 454, 459, 156 N.W. 927, 929 (1916) (stating “[t]he true test is whether or not the circumstances are such as to impose upon one in equity and good conscience the duty to speak”). The existence of a duty to disclose relieves the injured party of the burden of showing an affirmative deception to postpone the running of a statute of limitations. Snortland, 2000 ND 162, ¶ 15, 615 N.W.2d 574.

[¶ 21] We reject the distinct court’s conclusion that equitable estoppel under N.D.C.C. § 31-11-06 does not apply because the statute refers to a “party’s own” declaration, act or omission, and the party against whom estoppel is claimed is deceased. It is widely recognized that “an insurance adjuster acting for an insurance company may be considered the agent of the insured so as to estop the defendant-insured from raising the statute of limitations defense.” Sander v. Wright, 394 N.W.2d 896, 899 (S.D.1986). See also 7 Holmes’ Appleman on Insurance 2d § 49.21 (1998), and cases cited therein. This Court implicitly recognized that principle in Reiger, 531 N.W.2d at 310, where we reversed a summary judgment and remanded for trial on the issue of whether any statements or actions of the defendant’s insurance adjuster estopped the defendant from raising the statute of limitations as a defense. We will not interpret N.D.C.C. § 31-11-06 to provide a loophole for evading an estoppel defense when the death of a “party” is the fact that has been allegedly concealed from the plaintiff.

[¶ 22] Our interpretation is supported by cases in which equitable estoppel has been asserted as a bar to application of the statute of limitations when, unknown to the plaintiff, the named defendant is deceased. For example, in Wells v. Lueber, 43 Ill.App.3d 973, 3 Ill.Dec. 126, 358 N.E.2d 293 (1976), the plaintiff and Orville Winet were involved in a car accident and Winet died several months later. The plaintiff sued for personal injuries within the statute of limitations, naming Orville Winet as defendant, but the summons was returned by the sheriff with a notation that Winet had died. After the statute of limitations expired, the plaintiff learned of Winet’s death and sought to amend the complaint to substitute the executors of Winet’s estate as defendants. The trial court granted the motion to amend and the defendant moved to dismiss because the amended complaint was barred by the statute of limitations. The plaintiffs argued the defendants were estopped from pleading the statute of limitations defense. The plaintiffs attorney submitted an affidavit stating that before the original complaint was filed, Winet’s insurance carrier conceded liability, made numerous settlement offers and made advance payments for lost wages and medical expenses. The attorney further stated the insurance carrier discussed settlement before and after expiration of the limitations period, encouraged plaintiffs counsel to delay in filing suit, and failed to inform the plaintiff or her attorney of Winet’s death. The trial court denied the motion to dismiss.

[¶ 23] The appellate court agreed with the defendants that the original complaint against Winet “was a complete nullity,” but affirmed the denial of the motion to dismiss and remanded for further proceedings on the issue of equitable estoppel:

The mere pendency of negotiations, of course, would not be sufficient to work an estoppel against defendants. The foregoing allegations, however, charge the insurance carrier with conduct calculated to lull the plaintiff into a reasonable belief that the case would be settled without suit and that the defense of the statute of limitations would not be asserted. Upon proof of such conduct, defendants could be estopped from asserting the statute of limitations, and prior decisions require that plaintiff be given an opportunity to present such proof to the trier of fact.
Despite the urgings of Orville Winet’s insurance carrier, as alleged, plaintiff did file a timely complaint, albeit against a non-existent party. The fact of her reliance on any representation made is thus put in issue. In- addition, plaintiff could easily have discovered that Orville Winet was dead from examining the return of service by the Madison County Sheriff in the circuit clerk’s file. A party claiming the benefit of estoppel must prove that he reasonably relied upon the representations and conduct of the party against whom the estoppel is alleged ... and did not close his eyes to the obvious .... In considering this element of the estoppel doctrine, the trier of fact may take the foregoing facts into account. Those facts, however, are not sufficient to require a ruling that, as a matter of law, plaintiff was not “lulled into a reasonable belief’ that her claim would be settled.

Wells, 3 Ill.Dec. 126, 358 N.E.2d at 294-95 (citations omitted). The appellate court remanded the case for a jury to determine the equitable estoppel issue, and if the plaintiff succeeded on that issue, for a trial on the personal injury action. See also Vaughn v. Speaker, 156 Ill.App.3d 962, 109 Ill.Dec. 245, 509 N.E.2d 1084, 1088 (1987), aff'd, 126 Ill.2d 150, 127 Ill.Dec. 803, 533 N.E.2d 885 (1988) (holding plaintiff raised question of fact whether defendant could rely on statute of limitations by alleging insurance company did not inform plaintiff of defendant’s death and company conceded liability, advanced payments to settle property claim, discussed settlement before and after expiration of limitations peidod, and offered $15,000 to settle the personal injury claim).

[¶ 24] Another example is Pierce v. Johnson, 154 N.C.App. 34, 571 S.E.2d 661 (2002), where the plaintiff was involved in a car accident with John Daniel Johnson, who died of unrelated causes almost two years after the accident. John Daniel Johnson’s son, Roby Daniel Johnson, was appointed executor of the estate. Five months before the running of the statute of limitations, the plaintiff sued John Daniel Johnson for her personal injuries, and the executor of the estate accepted service of the complaint by signing the name “Daniel Johnson” on the return receipt for the certified mail. Id. at 662. The executor’s attorney, as “Attorney for Defendant,” moved to dismiss for lack of jurisdiction over the person, insufficiency of process, and insufficiency of service. Id. at 663. The executor’s attorney made two offers of judgment and served the plaintiff with interrogatories and a request for production of documents, all signed by the attorney as “Attorney for Defendant.” Id. After the statute of limitations expired, the executor’s attorney noticed a hearing on the motion to dismiss, and revealed for the first time that John Daniel Johnson had died. The plaintiff orally moved to amend the complaint and substitute the estate of the defendant, but the trial court denied the motion to amend and granted the motion to dismiss.

[¶ 25] The appellate court reversed and ruled the estate was equitably estopped, as a matter of law, from claiming the bar of the statute of limitations:

Here, the record shows that Ms. Pierce initiated the instant action on 28 April 2000, within the statute of limitations .... However, Ms. Pierce sued the decedent individually instead of bringing the suit against the personal representative or collector of defendant’s estate. The summons and complaint were then served on the personal representative of defendant’s estate, Roby Daniel Johnson. Instead of signing for the summons and complaint in his capacity as personal representative, Roby Daniel Johnson signed the return receipt “Daniel Johnson,” the name he shared with the deceased defendant. By so doing, the personal representative of Johnson’s estate missed an opportunity to inform Ms. Pierce that John Daniel Johnson was dead, and effectively, conducted the defense of the action as though John Daniel Johnson was still alive.
This misrepresentation as to the physical and legal existence of John Daniel Johnson was continued by the subsequent conduct of the purported “Attorney for Defendant.” On 6 June 2000, the motion to dismiss was filed in the name of John Daniel Johnson. Although the motion to dismiss did raise the issue of Ms. Pierce’s failure to name a real party in interest and failure to join a necessary party, since it was signed by the purported “Attorney for Defendant,” it did not place Ms. Pierce on notice that John Daniel Johnson was in fact dead and that she needed to proceed against the personal representative of John Daniel Johnson’s estate.
Additionally, after receipt of the motion, Ms. Pierce’s attorney filed the proof of service certifying that service was obtained on John Daniel Johnson at his last known address. Following that, Ms. Pierce’s attorney received two offers of judgment, a set of interrogatories and request for production of documents, and a request for monetary relief sought. They were all signed by the purported “Attorney for Defendant” and received within the statute of limitations. According to the record, the personal representative of John Daniel Johnson’s estate and the purported “Attorney for Defendant” took no affirmative steps to inform Ms. Pierce or her counsel that defendant was in fact dead. Had they done so, Ms. Pierce would have been able to amend her complaint to substitute the personal representative as party defendant within the statute of limitations, which did not expire until 14 October 2000.
As a result of the conduct of the personal representative and the purported “Attorney for Defendant,” Ms. Pierce was apparently led to believe that John Daniel Johnson was still alive. By the 8 March 2001 hearing, the statute of limitations expired and Ms. Pierce was without recourse. John Daniel Johnson’s estate should not benefit from such conduct. By them action, the personal representative of John Daniel Johnson’s estate and the purported “Attorney for Defendant” led Ms. Pierce to believe that John Daniel Johnson was still alive. Ms. Pierce and her counsel apparently relied on this representation. John Daniel Johnson’s estate cannot now assert an inconsistent position to the detriment of Ms. Pierce. Consequently, we hold as an additional ground for granting relief to Ms. Pierce that John Daniel Johnson’s estate was equitably estopped from asserting the statute of limitations as a defense to Pierce’s action.

Pierce, 571 S.E.2d at 667-68.

[¶ 26] As Wells, Vaughn and Pierce suggest, under certain circumstances, representatives of a deceased defendant may have an affirmative duty to speak. Courts have described the source of the duty as general notions of honesty and fair dealing, and left to the trier of fact to decide whether such a duty arises under the particular circumstances. See Delson v. Minogue, 190 F.Supp. 935, 937 (E.D.N.Y.1961); Kilburn v. Keenan, 27 Conn.Supp. 394, 240 A.2d 213, 214 (1967); Pellerin v. Cashway Pharm. of Franklin, 396 So.2d 371, 373 (La.Ct.App.1981); compare Yoh v. Hoffman, 29 Kan.App.2d 312, 27 P.3d 927, 931 (2001) (holding appropriate course for lawyer is “to stand silent or to inform opposing counsel and the court” of defendant’s death because “[k]nowingly filing a pleading on behalf of a dead person as though he or she is still alive is fraud”). North Dakota law also recognizes that “[k]nowingly misrepresenting to claimants pertinent facts or policy provisions relating to coverages at issue” is an unfair claim settlement practice “if done without just cause and if performed with a frequency indicating a general business practice.” N.D.C.C. § 26.1-04-03(9)(a).

[¶ 27] The district court principally relied on two decisions in dismissing Mu-hammed’s action. In Van Slooten v. Estate of Schneider-Janzen, 623 N.W.2d 269 (Minn.Ct.App.2001), two weeks before the statute of limitations expired the plaintiff sued Schneider-Janzen for damages resulting from an auto accident. The sheriff delivered the summons and complaint to the defendant’s husband, who informed the sheriff his wife had died. The sheriff noted the death on the certificate of service. There was no probate of Schneider-Jan-zen’s estate and no personal representative was ever appointed. More than two months after the statute of limitations expired, the plaintiff served the husband an amended summons and complaint naming as defendants Schneider-Janzen’s estate and the husband as personal representative. The appellate court ruled the trial court erred in failing to dismiss the lawsuit for insufficiency of service of process because service upon the husband “was insufficient to commence an action against the estate.” Id. at 271. The court reasoned it did not matter that the husband had actual notice of the claim because he was not the personal representative of the estate. The court also ruled that the amended summons and complaint could not relate back to the original summons and complaint to avoid the statute of limitations because the original action against the deceased was a “legal nullity” and, therefore, “there exists no action to which the amendment can relate back.” Id. at 271-72.

[¶ 28] Van Slooten is distinguishable because the plaintiff did not assert that the defendant was equitably estopped from claiming the statute of limitations defense. Moreover, the “nullity theory” relied upon by the appellate court has recently fallen into disfavor by several courts when a deceased person, rather than the person’s estate, has been named erroneously as the defendant. See, e.g., Hamilton v. Blackman, 915 P.2d 1210, 1216-18 (Alaska 1996); Trimble v. Engelking, 130 Idaho 300, 939 P.2d 1379, 1381-82 (1997); Indiana Farmers Mut. Ins. Co. v. Richie, 707 N.E.2d 992, 996-98 (Ind.1999); Hinds v. Estate of Huston, 31 Kan.App.2d 478, 66 P.3d 925, 928-29 (2003); Pierce, 571 S.E.2d at 664-67. The nullity rule has been criticized as “a remnant of an earlier era of strict pleading requirements” because “precluding amendment and relation back where a party is improperly named, would frustrate the purpose of our modern rules of pleading which seek to promote the resolution of disputes on their merits rather than to bar suit based on antiquated pleading requirements.” Trimble, 939 P.2d at 1381. These courts hold their state counterpart to N.D.R.Civ.P. 15(c), which provides for relation back of an amended pleading, is applicable under these circumstances if the requirements of the rule have been met. See Hamilton, 915 P.2d at 1217-18; Trimble, 939 P.2d at 1381-82; Hinds, 66 P.3d at 928-29; Pierce, 571 S.E.2d at 666. Compare Richie, 707 N.E.2d at 997-98 (permitting a plaintiff to amend to substitute the estate for the decedent because the “fundamental purpose of rule 15(c) — fairness to the incoming defendant — is met where, as in this case, the suit seeks only insurance proceeds and the insurance company had actual notice and knowledge of the suit”). This Court has adopted a liberal interpretation of N.D.R.Civ.P. 15(c) to allow a defendant’s constructive notice of a suit to trigger the relation back of an amended pleading. See Wayne-Juntunen Fertilizer Co. v. Lassonde, 456 N.W.2d 519, 526 (N.D.1990).

[¶ 29] Kimball v. Landeis, 2002 ND 162, 652 N.W.2d 330, also relied upon by the district court, involved a negligence action against Landeis, whose mother had been appointed his legal guardian before the plaintiff served the summons and complaint on Landeis. Landeis moved to dismiss the action because the plaintiff had not served Landeis’s guardian. After the trial court quashed the service on Landeis, the plaintiff personally served Landeis’s guardian, but the statute of limitations had, by then, expired. The trial court granted Landeis’s motion for summary judgment. This Court affirmed dismissal of the claim against Landeis because it was barred by the statute of limitations. We concluded “actual knowledge of Kimball’s action did not confer personal jurisdiction over Landeis until his guardian was served.” Id. at ¶ 20. We also concluded the doctrine of equitable tolling did not apply because the plaintiff “failed to establish reasonable and good faith action.” Id. at ¶ 33. We further held, although the plaintiff claimed he was not aware Landeis had a guardian, “Landeis’s guardianship is a matter of public record, and Kimball has not demonstrated the guardianship could not have been ascertained by a timely diligent inquiry.” Id. at ¶ 30. While we did not condone Landeis’s failure to reflect his guardianship status in his answer, because the answer was mailed on the day the statute of limitations expired, “Lan-deis’s failure to identify the guardianship in his answer could not have affected Kim-ball’s failure to timely serve Landeis’s guardian.” Id. at ¶ 31. The record also reflected that the plaintiff had actual knowledge of the guardianship in June 2001, but did not attempt to serve the guardian until January 2002. Id. at ¶ 32.

[¶ 30] The district court in this case found Kimball “very analogous to the present situation” because “the first Answer served by Defendant in the present case came on the very day that the statute of limitations expired. The fact that Plaintiff was not informed that Defendant had died would not have mattered because Plaintiff would not have been able to timely serve a personal representative of Defendant’s estate.” However, Kimball is also distinguishable from the present case. Foremost, the equitable estoppel doctrine relied upon by Muhammed was not an issue in Kimball. Kimball, 2002 ND 162, ¶ 24, 652 N.W.2d 330, involved the doctrine of equitable tolling, which “[t]his Court has never adopted,” and which differs from the doctrine of equitable estoppel. See Burr, 492 N.W.2d at 908 (noting the doctrine of equitable estoppel is one of the options other than equitable tolling to extend or avoid the statute of limitations). The elements for equitable tolling differ from the elements of equitable estoppel under N.D.C.C. § 31-11-06, and require “1) timely notice, 2) lack of prejudice to the defendant, and 3) reasonable and good-faith conduct by the plaintiff.” Kimball, at ¶ 24. Kimball also did not involve the allegedly concealed death of a party or include allegations that the defendant requested and received an indefinite extension of time to answer the complaint. Although Kimball, at ¶ 31, may suggest a rejection of relation-back principles applied by some courts, and Bartell v. Morken, 65 N.W.2d 270, 274 (N.D.1954), may have indicated acceptance of the “nullity theory,” it is not necessary for us to apply these principles in this case. Courts which have adopted the nullity theory and rejected relation-back principles nevertheless have barred the defendant from raising the statute of limitations defense if the elements of equitable estoppel have been met. See, e.g., Vaughn v. Speaker, 126 Ill.2d 150, 127 Ill.Dec. 803, 533 N.E.2d 885, 889-92 (1988) (rejecting the relation-back doctrine to permit substitution of executor for decedent but remanding for factual determination whether defendant was equitably estopped from raising the statute of limitations defense); Wells, 3 Ill.Dec. 126, 358 N.E.2d at 295 (same); Moore v. Luther, 29 Kan.App.2d 1004, 35 P.3d 277, 279-81 (2001) (applying nullity theory when decedent was sued, but modifying dismissal to be without prejudice and suggesting executor could be sued and equitable estoppel could be raised to avoid statute of limitations).

[¶ 31] The parties in this case agree that the statute of limitations expired on March 27, 2002. Goughnour, the insurance adjuster, was informed of a potential claim in January 1999, about nine months after Ellen Welch died. No probate proceedings were initiated and no personal representative was appointed. Pat Welch was served September 12, 2001, signed for the certified mail, and gave the papers to his insurance agent, who turned them over to Austin Mutual. At this point, Austin Mutual and Goughnor had been informed that Ellen Welch was dead. Fully aware that Ellen Welch was dead and six months before the statute of limitations expired, Goughnor requested and obtained an indefinite extension of time to answer the complaint without informing Muhammed’s attorney of the death. Goughnour knew the statute of limitations was a concern to Muhammed. Settlement discussions continued without Goughnour or Austin Mutual disclosing the death. On the day the statute of limitations expired, the defendant finally answered without informing Muhammed of the death, and instead stated “Defendant Ellen Welch” demanded a jury trial. Not until one and one-half months after amending the answer to raise insufficiency of process and service of process and lack of subject matter jurisdiction, and more than two months after the statute of limitations had expired, was Mu-hammed informed that Ellen Welch was dead. Under these circumstances, we believe the trier of fact could find that Goughnour and Austin Mutual had a duty to disclose the fact of Ellen Welch’s death to Muhammed at least from the time Goughnor requested and received the indefinite extension of time to file the answer, and that Goughnour and Austin Mutual lulled Muhammed “into a false sense of security” that his claim would be settled without being subjected to the statute of limitations defense.

[¶ 82] It is arguable that Mu-hammed should not reasonably have relied on Pat Welch’s signature on the restricted delivery receipt as resulting in effective service on Ellen Welch, see N.D.R.Civ.P. 4(d)(2)(A)(v), and that Muhammed could have discovered on his own that Ellen Welch was dead. However, these factors do not defeat equitable estoppel as a matter of law, and are for the trier of fact to consider with the other evidence. See Wells, 3 Ill.Dec. 126, 358 N.E.2d at 295.

[IT 33] We conclude the district court erred in dismissing Muhammed’s complaint because he raised a genuine issue of material fact whether the defendant is es-topped from claiming the statute of limitations defense.

Ill

[¶ 34] It is unnecessary to address other issues raised. We reverse the summary judgment and remand for trial of the equitable estoppel issue. If equitable estoppel is found to apply in this case, Muhammed should be allowed to open and sue Ellen Welch’s estate for damages. If equitable estoppel does not apply, the case should be dismissed.

[¶ 35] GERALD W. VANDE WALLE, C.J., MARY MUEHLEN MARING, WILLIAM A. NEUMANN, and DALE Y. SANDSTROM, JJ., concur.


source: Caselaw Access Project

author: SANDSTROM, Justice.

license: Public Domain

text:
    2004 ND 40
    John DIXON, Plaintiff and Appellant v. McKENZIE COUNTY GRAZING ASSOCIATION, Defendant and Appellee.
    No. 20030005.
    Supreme Court of North Dakota.
    Feb. 25, 2004.
    Rehearing Denied March 23, 2004.

      Charles L. Chapman, Chapman and Chapman, Bismarck, N.D., for plaintiff and appellant.
    Dennis Edward Johnson, Johnson & Sundeen, Watford City, N.D., for defendant and appellee.
   SANDSTROM, Justice.

[¶ 1] John Dixon appealed from a judgment dismissing his action against the McKenzie County Grazing Association (“MCGA”) and awarding MCGA $2,500 in attorney’s fees and $4,536.59 in costs. We hold Dixon’s claim against MCGA for breach of a fiduciary duty is barred by the statute of limitations, the trial court did not err in finding MCGA acted properly in finding Dixon engaged in 1994 and 1997 unauthorized grazing uses, MCGA had authority to change Dixon’s ranch from an inventory to a turn-in headquarters, and the trial court did not abuse its discretion in awarding MCGA attorney’s fees and costs. We affirm.

I

[¶ 2] MCGA is a cooperative grazing association organized under N.D.C.C. ch. 36-08 to lease national grasslands in McKenzie County from the federal government and to issue grazing permits to MCGA members. During the 1930s, the federal government purchased grasslands in McKenzie County to revegetate those lands and to stabilize the local economy. On behalf of the federal government, the Forest Service administers those leases with MCGA. The Forest Service and MCGA have adopted Grazing and Management Agreements with rules of management to govern grazing on the grasslands under MCGA’s jurisdiction.

[¶ 3] To become a MCGA member and obtain a grazing permit on grasslands under MCGA’s jurisdiction, an applicant must either own or lease “base property,” which is defined under MCGA’s rules of management as “designated property on which a grazing preference was established as original members came into the MCGA. Base property is identified in the MCGA records on the original applications and consisted of both deeded and leased acres.” In 1936, the federal government conducted a survey to determine prior grazing use of the grasslands. The 1936 survey and original base property were used to determine grazing preferences, which confer the right to graze a specified number of cattle for a specified number of months on the federal grasslands. A 1938 grazing agreement between MCGA and the United States required MCGA to classify grazing preferences as either a class A preference for applicants with a priority of use, or a class B preference for applicants without a priority of use. In 1966, MCGA adopted a policy that “[a]ll existing preferences shown on the records of the Association as of June 9, 1966, shall be recognized subject to the rules and regulations of the Association.” According to Dixon, MCGA’s action “lessened the rights of the original base property owners,” and in the early 1990s, MCGA addressed issues about base property and grazing preferences. During this process, the term “phantom rights” was used to refer to grazing preferences not attached to original base property. In 1993, the MCGA executive board issued a report that referred to phantom rights, and voted to accept the report after changing the reference to phantom rights to “the difference between the original rights and today[’s] rights.”

[¶ 4] In November 1942, Dixon’s grandfather applied for reinstatement as a member of MCGA. MCGA’s records state the application was for a “back membership” with fees paid for 1940, 1941, 1942, and 1943. MCGA approved the application in 1943. In 1952, MCGA approved an application to change the membership for the Dixon ranch from Dixon’s grandfather to Dixon’s father, W.D. Dixon. In 1972, W.D. Dixon’s membership in MCGA was transferred to the W.D. Dixon Trust. In 1983, MCGA approved an application to change the membership for the Dixon ranch from the W.D. Dixon Trust to W.D. Dixon, Shirley Dixon, and John Dixon. In 1986, John Dixon began managing the Dixon ranch.

[¶ 5] Since 1943, the grazing preference for the Dixon ranch has been set at 100 animal units on MCGA controlled land, and since the 1950s, the Dixon ranch has been classified as an “inventory headquarters,” which is defined under MCGA’s rules of management as “[a] ranch headquarters with private and allocated [Forest Service] lands, and on which the total number of animals are limited by the grazing preference.”

[¶ 6] In October 1993, MCGA’s Unauthorized Use Committee investigated an unauthorized-grazing-use complaint by the Forest Service against Dixon. Under MCGA’s rules of management, an unauthorized grazing use means “grazing livestock in excess or deviation of ... [an] annual permit, whether on headquarters or in a common grazing allotment.” An exception to an unauthorized grazing use is allowed “when excess units on inventory headquarters are in connection with normal management practices, i.e. branding, weaning, delay of turnout date, treating sick animals, etc., as long as the National Grasslands is not being abused.” According to MCGA’s president, MCGA found Dixon had not violated the unauthorized grazing use regulation, because, in addition to his annual permit, he had been issued a temporary permit that allowed him to temporarily have more than the permitted number of livestock on his ranch. According to MCGA’s secretary, after the 1993 complaint against Dixon, the Forest Service directed MCGA to “tighten up” how it issued temporary permits, and in 1994, MCGA developed a new form for temporary grazing permits, which was included in minutes sent to MCGA members.

[¶ 7] On December 15, 1994, MCGA’s Unauthorized Use Committee investigated an unauthorized-grazing-use complaint by a MCGA member against Dixon. MCGA concluded Dixon had engaged in an unauthorized grazing use in allowing 254 head of cattle over his permitted limit on his inventory headquarters without having been issued a temporary permit. MCGA changed the classification of Dixon’s ranch from an inventory headquarters to a turn-in headquarters, which is defined under MCGA’s rules of management as “[a] ranch headquarters with no allocated [Forest Service] land and only a summer dependency for the grazing preference.” The change in Dixon’s headquarters placed the federal land on his headquarters into common grazing area. According to MCGA, a member with an inventory headquarters can graze cattle on common federal land during the summer grazing season, but subjects his private deeded land to MCGA regulations and permit requirements, while a member with a turn-in headquarters can graze cattle on common federal land during the summer grazing season, but does not subject his deeded land to MCGA regulations and permit requirements. According to Dixon, the change in headquarters allowed him to increase his summer grazing on common federal land to 139 animal units, but decreased the size of his headquarters and required him to provide extra feed for the 139 animal units when he was not grazing on common federal land.

[¶ 8] In August 1997, MCGA’s Unauthorized Use Committee investigated an unauthorized-grazing-use complaint against Dixon. MCGA concluded Dixon had engaged in a willful, unauthorized grazing use in which his cattle were found in a part of a common grazing pasture where they were not authorized, and MCGA fined Dixon.

[¶ 9] In 1995, Dixon sued MCGA, alleging, among other things, MCGA diluted his grazing preference by issuing grazing preferences to individuals who originally did not own base property, MCGA acted arbitrarily and capriciously in finding him guilty of the 1994 unauthorized grazing use, and MCGA lacked authority to change his ranch from an inventory to a turn-in headquarters. In an amended complaint, Dixon alleged MCGA acted arbitrarily and capriciously in finding him guilty of the 1997 unauthorized grazing use.

[¶ 10] The trial court dismissed some of Dixon’s claims before trial, and after a bench trial, the court dismissed Dixon’s remaining claims. The court thereafter concluded three of Dixon’s claims, which had been dismissed before trial, were frivolous and awarded MCGA $2,500 in attorney’s fees for those claims. The court also awarded MCGA $4,536.59 in costs. Dixon appealed, and while his appeal was pending, we temporarily remanded to the trial court for the limited purpose of allowing it to consider Dixon’s motion to supplement the record with affidavits by MCGA’s president and its attorney from another case. The trial court denied Dixon’s motion to supplement the record.

[¶ 11] The trial court had jurisdiction under N.D. Const, art. VI, § 8, N.D.C.C. § 27-05-06, and N.D.R.App.P. 35(a)(3). Dixon’s appeal is timely under N.D.R.App.P. 4(a). This Court has jurisdiction under N.D. Const, art. VI, §§ 2 and 6, and N.D.C.C. § 28-27-01. .

II

[¶ 12] Dixon argues he is a direct beneficiary of the duties MCGA owes its members, and he claims his grazing preference has been diluted because grazing preferences have been extended to individuals who originally did not own base property. He argues “[i]n 1966, when the preferred status of Class A preferences was diminished, and again in the 1990s when the status of base property was reviewed, the MCGA had a duty to those persons, who were the beneficiaries of the original state law and the original charter, to protect their interest.... By failing to protect that original interest, the MCGA breached its duty to the original members and caused them, including [him], damage.”

[¶ 13] The trial court granted MCGA summary judgment on Dixon’s claims for breach of a fiduciary duty, concluding MCGA had no fiduciary obligation for transactions between it and an individual member and his claim was barred by the statute of limitations.

[¶ 14] Summary judgment is a procedural device for promptly disposing of a claim without a trial if, after viewing the evidence in the light most favorable to the non-moving party, there are no genuine issues of material fact or inferences that reasonably can be drawn from undisputed facts, or if the only issues to be resolved are questions of law. Tarnavsky v. McKenzie County Grazing Ass’n, 2003 ND 117, ¶ 7, 665 N.W.2d 18. In Tarnavsky, at ¶¶ 10-15, we affirmed a summary judgment dismissing a claim similar to that raised by Dixon. We did not decide whether a six-year or a ten-year statute of limitations governed the action, because we concluded the alleged wrongdoing occurred well outside either statute of limitations. Id. at ¶ 14. We said the right to bring a similar claim, if one existed, came into existence when Tarnavsky’s predecessors in interest released grazing preferences in the 1940s and no later than 1966 when MCGA eliminated the distinction between class A and class B preferences. Id. at ¶ 10. We concluded Tamavsky was not entitled to any greater rights under the statute of limitations than his predecessors in interest. Id. We rejected Tar-navsky’s argument the discovery rule saved his claim, concluding he knew or reasonably should have known of the difference in preferences during the years when he and his predecessors in interest were receiving grazing permits. Id. at ¶¶ 11-12. We also rejected Tarnavsky’s argument the annual issuance of grazing permits was a continuing wrong. Id. at ¶ 13.

[¶ 15] The Dixon ranch has been part of MCGA and has received grazing permits since the 1940s. Dixon’s grandfather became a member of MCGA in 1943, his father became a member of MCGA in 1952, and he became a member in 1983. Dixon brought this action against MCGA in 1995. Dixon argues his claim is not barred by the statute of limitations, because he lacked knowledge of the claim until 1993, MCGA’s establishment, review, creation, or identification of base property was not completed until 1996, and the annual issuance of grazing permits was a continuing wrong. Those arguments are the same as the arguments we rejected in Tarnavsky, 2003 ND 117, ¶¶ 10-14, 665 N.W.2d 18. We hold Dixon’s claim about a fiduciary duty and the dilution of his grazing preference is barred by the statute of limitations and by our decision in Tarnavsky.

Ill

[¶ 16] Dixon argues MCGA acted arbitrarily and capriciously in finding him guilty of the December 1994 unauthorized grazing use and in changing his headquarters from an inventory to a turn-in headquarters. Dixon also argues MCGA acted arbitrarily and capriciously in finding him guilty of the August 1997 unauthorized grazing use.

A

[¶ 17] We initially consider the appropriate standard for review of actions by MCGA, which is a cooperative grazing association organized under N.D.C.C. ch. 36-08. A grazing association’s governing body is subject to the general laws governing directors of cooperatives. N.D.C.C. § 36-08-08. In Lili v. Cavalier Rural Elec. Coop., Inc., 456 N.W.2d 527, 530 (N.D.1990), this Court said the business judgment rule applied to decisions by a cooperative’s board of directors:

Normally, the good faith acts of corporate directors within the power of the corporation and in the exercise of honest business judgment are considered valid and the courts generally will not interfere with or regulate the conduct of the directors in the reasonable and honest exercise of their judgment and duties where their judgment is uninfluenced by personal consideration.

[¶ 18] We conclude that standard applies to a trial court’s consideration of actions by a grazing association. We further conclude a trial court’s findings under that standard are renewable under the clearly erroneous standard of N.D.R.Civ.P. 52(a). A finding of fact is clearly erroneous if it is induced by an erroneous view of the law, if no evidence exists to support the finding, or if, on the entire record, we are left with a definite and firm conviction a mistake has been made. Hogan v. Hogan, 2003 ND 105, ¶ 6, 665 N.W.2d 672. A trial court’s choice between two permissible views of the weight of the evidence is not clearly erroneous. Id. (quoting Schmaltz v. Schmaltz, 1998 ND 212, ¶ 6, 586 N.W.2d 852). On appeal, we do not reweigh conflicts in the evidence. Center Mut. Ins. Co. v. Thompson, 2000 ND 192, ¶ 20, 618 N.W.2d 505.

B

[¶ 19] Dixon argues MCGA acted unreasonably in finding him guilty of the December 1994 unauthorized use. He argues he had a reasonable history of experience with MCGA under which the presence of non-permitted excess units on his headquarters had been accepted, and on December 5, 1994, he applied for a temporary permit for 260 extra units. He claims he assumed the temporary permit had been approved, because there was evidence no temporary permit had ever been denied and he had been approved for 170 extra units in 1992 and 176 extra units in 1993. He claims, although MCGA did not approve his application for a temporary permit, the normal business practice exception to excess units applied to his situation. He argues he was not guilty of a willful or intentional trespass in December 1994.

[¶ 20] MCGA’s operations manual provides that “[a]ny member grazing livestock in excess or deviation of his/her annual permit, whether on headquarters or in a common grazing allotment, is in unauthorized use.” An exception is allowed “when excess units on inventory headquarters are in connection with normal management practices, i.e. branding, weaning, delay of turn out date, treating sick animals, etc., as long as the National Grasslands is not being abused.” Under MCGA’s operations manual, an Unauthorized Use Committee shall immediately investigate unauthorized use grazing complaints and determine whether the unauthorized use was willful or intentional. If the Unauthorized Use Committee decides an unauthorized use was willful or intentional, the overage shall be removed and the Board will arrange a hearing. If the Board decides “an unauthorized use has been taken and the violator is a member of the MCGA, the Board shall apply the penalty rules.” Under MCGA’s operations manual, a “[violator shall be assessed five times the MCGA monthly grazing fee per animal for the first five units and ten (10) times the grazing fee per animal for each over five, and/or suspend or revoke the member’s or non-member’s permit.” MCGA’s operations manual also provides discretionary authority for MCGA to issue temporary permits.

[¶ 21] The trial court refused tosúbsti-' tute its judgment for MCGA’s determination that Dixon engaged in an unauthorized use in December 1994, and the court concluded the normal management practices exception to the excess units rule provided Dixon with no relief. The court decided MCGA acted in good faith in handling the 1994 unauthorized use complaint.

[¶ 22] There is evidence the Forest Service directed MCGA to “tighten up” its procedure for issuing temporary permits after 1993, and MCGA thereafter developed a form for temporary permits with notice to every MCGA member. There is evidence Dixon had 254 cattle over his permitted limit on his inventory headquarters on December 15, 1994, without having been issued a temporary permit. Although Dixon had applied for a temporary permit for 260 animal units on December 5, 1994, MCGA did not approve that permit, and there is evidence an applicant has the responsibility to make sure a temporary permit has been approved. Dixon’s December 5, 1994, application for a temporary grazing permit for 260 animal units stated the date “on” was “12/5/94” and the date “off’ was “5/15/95,” which supports an inference he intended to winter those cattle on his headquarters. There is evidence Dixon continued to haul cattle from a ranch in Oliver County and other non-MCGA controlled land in McKenzie County to his headquarters in McKenzie Co.unty after MCGA investigated the complaint on December 15. Although Dixon claims he was going to conduct a pregnancy check on the livestock, there is evidence he had not contacted a veterinarian until after the livestock had been brought to his headquarters. There is evidence that under the normal ranch practices exception, non-permitted cattle cannot be on an inventory headquarters unless they are in a feedlot, and there is evidence Dixon’s non-permitted cattle were on grasslands on his inventory headquarters and not in a feedlot. MCGA implicitly found Dixon had engaged in a willful and intentional unauthorized use when it proceeded to change his headquarters. Although there is some evidence supporting Dixon’s claim he did not engage in a willful and unauthorized grazing use. in December 1994, there is also evidence supporting a contrary finding. A trial court’s choice between two permissible views of the weight of the evidence is not clearly erroneous. Hogan, 2003 ND 105, ¶ 6, 665 N.W.2d 672. We are not left with a definite and firm conviction the trial court made a .mistake in finding MCGA acted in good faith in determining Dixon engaged in a willful and intentional unauthorized grazing use in December 1994. We therefore conclude the trial court’s findings are not clearly erroneous.

C

[¶ 23] Dixon argues MCGA acted unreasonably by changing his ranch from an inventory to a turn-in headquarters as a result of the December 1994 unauthorized use. He argues the normal punishment for an unauthorized use is a monetary fine.

[¶ 24] The trial court -decided MCGA was authorized to change Dixon’s ranch from an inventory to a turn-in headquarters as a permissible sanction for the 1994 unauthorized use. Section 36-08-02(3), N.D.C.C., authorizes a grazing association to “[a]pportion to members grazing rights within its district on such terms, conditions, and limitations ... as may be specified by the board of directors of the association.” Under N.D.C.C. § 36-08-08(1) and (2), the dii’ectors of a grazing association may regulate and apportion grazing rights within the district. The directors may create grazing subdivisions in the district and determine the length of time a member may graze specified stock in a subdivision. N.D.C.C. § 36-08-08(3) and (4). The directors also may suspend or expel any member for refusing to abide by or conform to the rules and regulations of the association or its directors. N.D.C.C. § 36-08-08(10). MCGA’s articles of incorporation authorize it to apportion a member’s grazing rights on such terms, conditions, and limitations as specified by the directors and to do everything necessary and proper for the accomplishment of its objectives or conducive to the benefit of the association. Under MCGA’s operations manual, MCGA and the Forest Service must jointly “[t]ake appropriate and timely action against unauthorized livestock use.” MCGA members agree to “(cjomply with the By-laws, Rules of Management, policies and allotment management plans of the MCGA,” and a member’s grazing preference and annual permit may be suspended, revoked, or canceled for failure to comply with those provisions, including excess numbers. MCGA’s operations manual also provides that for unauthorized grazing use, a “[violator shall be assessed five times the MCGA monthly grazing fee per animal for the first five units and (10) times the grazing fee per animal for each over five, and/or suspend or revoke the member’s or non-member’s permit.”

[¶ 25] Those provisions authorize MCGA to fine, suspend, or revoke a member’s grazing permit for an unauthorized grazing use. MCGA did not impose a sanction as severe as suspending or revoking Dixon’s grazing permit. Rather, MCGA changed Dixon’s ranch from an inventory headquarters to a turn-in headquarters, which was within the range of sanctions MCGA could have imposed. We conclude the foregoing provisions authorized MCGA to change Dixon’s ranch from an inventory to a turn-in headquarters. We further conclude there is evidence to support MCGA’s decision to change Dixon’s headquarters, and the trial court’s findings on this issue are not clearly erroneous.

D

[¶ 26] Dixon argues MCGA acted arbitrarily and unreasonably in finding him guilty of a willful unauthorized grazing use in August 1997. He argues the evidence indicates the 1997 unauthorized use was neither willful nor intentional, and a fine was not warranted.

[¶ 27] The trial court said MCGA’s finding of a willful trespass by Dixon in August 1997 was based on circumstantial evidence. The court, however, declined to substitute its judgment for MCGA’s and found the greater weight of the evidence supported MCGA’s determination Dixon committed a willful or intentional trespass, because he had a duty to keep his cattle in the appropriate unit of a common pasture. There is evidence some of Dixon’s permitted cattle were found in a part of a pasture where they were not supposed to be in August 1997. There is evidence a MCGA member is responsible for keeping livestock in the correct part of a pasture. There also is circumstantial evidence Dixon’s cattle had been in a part of the pasture where they were not supposed to be for a considerable period of time. The circumstantial evidence supports an inference the August 1997 unauthorized use was willful. The trial court acknowledged the evidence was largely circumstantial and found the unauthorized use was willful. We do not reweigh conflicts in the evidence. Thompson, 2000 ND 192, ¶ 20, 618 N.W.2d 505. We conclude the trial court’s findings on the August 1997 unauthorized use are not clearly erroneous.

IV

[¶ 28] Dixon argues the trial court erred in awarding MCGA $2,500 in attorney’s fees. The court dismissed several of Dixon’s claims before trial, and the court thereafter found three of those claims were frivolous. The court found count four, which alleged MCGA attempted to coerce Dixon into accepting a change in the status of his grazing permit; count six, which alleged MCGA participated in a conspiracy to restrain Dixon from making lawful and legitimate use of his property in violation of N.D.C.C. ch. 51-08.1; and part of count seven, which alleged damage to Dixon’s business reputation, were frivolous. The court said there was such a complete absence of actual facts or law that no reasonable person could have thought a court would enter judgment in his favor as to those three claims, and the court awarded MCGA a total of $2,500 in attorney’s fees, with $1,000 allocated to count four, $1,000 allocated to count six, and $500 allocated to count seven.

[¶ 29] Under N.D.C.C. § 28-26-01(2), a court may, in its discretion, upon finding a claim for relief is frivolous, award reasonable attorney’s fees to the prevailing party. A claim is frivolous when there is such a complete absence of actual facts or law that a reasonable person could not have expected the court to render a judgment in that party’s favor. Soentgen v. Quain & Ramstad Clinic, P.C., 467 N.W.2d 73, 84 (N.D.1991). Although a trial court’s award of attorney’s fees for frivolous claims should not chill enthusiasm and creativity in pursuing factual legal theories, a court’s award of attorney’s fees is discretionary and will be upheld if the court has not abused its discretion. Id. at 84-85. A court abuses its discretion if it acts in an arbitrary, unreasonable, or unconscionable manner, its decision is not the product of a rational mental process leading to a reasoned decision, or it misinterprets or misapplies the law. Olander Contracting Co. v. Gail Wachter Inv., 2003 ND 100, ¶8, 663 N.W.2d 204.

[¶ 30] Dixon argues his “case has tested the authority of a North Dakota Grazing Association to alter his grazing rights, both by his claim that grazing permits have been issued to unqualified property owners and by his concern over the forced alteration of his headquarters. These are claims of first impression and thus do not touch settled law in North Dakota.”

[¶ 31] MCGA claimed it incurred $49,922.34 in attorney’s fees for the entire action; however, the trial court found only three of Dixon’s claims were frivolous and awarded MCGA $2,500 in attorney’s fees for those three claims. We conclude the court’s award and allocation of $2,500 in attorney’s fees for those three claims was the product of a rational mental process and was not arbitrary, unreasonable, or unconscionable. We therefore conclude the court did not abuse its discretion in awarding MCGA $2,500 in attorney’s fees.

V

[¶ 32] Dixon argues the trial court erred in awarding MCGA costs for photocopies, a binder used for trial exhibits, postage, long distance telephone calls, costs to retrieve tax returns that were not used at trial, and the unsubstantiated cost of a search of his records by the Forest Service.

[¶ 33] Under N.D.C.C. § 28-26-06(2), disbursements shall be taxed as part of the judgment in favor of the prevailing party for necessary expenses for procuring evidence necessarily used or obtained for use at trial. The allowance of costs and disbursements to a prevailing party under N.D.C.C. § 28-26-06 lies within the sound discretion of the trial court, and its decision will not be overturned on appeal absent an abuse of discretion. Huber v. Oliver County, 1999 ND 220, ¶ 22, 602 N.W.2d 710; Patterson v. Hutchens, 529 N.W.2d 561, 566-68 (N.D.1995); Richter v. Jones, 378 N.W.2d 209, 213 (N.D.1985).

[¶ 34] Dixon asserts he asked for receipts for certain disbursements but his request was rejected. In Huber, 1999 ND 220, ¶ 23, 602 N.W.2d 710, we said receipts and personal attestation were not required for costs under N.D.R.Civ.P. 54(e). The trial court was in a better position than this Court to determine the reasonableness and necessity of costs sought by MCGA. See Richter, 378 N.W.2d at 213. We conclude the trial court did not abuse its discretion in awarding MCGA costs for the items contested by Dixon.

VI

[¶ 35] Dixon argues the trial court erred in denying his motion to supplement the record with affidavits by MCGA’s president and its attorney in a non-related case in federal court. Dixon’s claims essentially relate to materials he asserts were not provided to him during discovery for this case. Discovery decisions are addressed to a trial court’s discretion and will not be reversed on appeal absent an abuse of discretion. Matter of Estate of Schmidt, 1997 ND 244, ¶ 7, 572 N.W.2d 430 (quoting In re Estate of Murphy, 554 N.W.2d 432, 440 (N.D.1996)). We are not persuaded the trial court abused its discretion in denying Dixon’s motion to supplement the record.

VII

[¶ 36] We affirm the judgment dismissing Dixon’s claims against MCGA.

[¶ 37] GERALD W. VANDE WALLE, C.J., WILLIAM A. NEUMANN, MARY MUEHLEN MARING and CAROL RONNING KAPSNER, JJ., concur.


author: PER CURIAM.

text:
    2004 SD 15
    STATE of South Dakota, Plaintiff and Appellee, v. Duane J. ST. JOHN, Defendant and Appellant.
    No. 22774.
    Supreme Court of South Dakota.
    Considered on Briefs Nov. 17, 2003.
    Decided Feb. 4, 2004.
    Lawrence E. Long, Attorney General, Frank Geaghan, Assistant Attorney General, Pierre, Attorneys for plaintiff and appellee.
    Jeremiah J. Davis, Pennington County Public Defender’s Office, Rapid City, Attorneys for defendant and appellant.
   PER CURIAM.

[¶ 1.] Duane St. John appeals his conviction for aggravated assault. We affirm.

FACTS

[¶ 2.] St. John was a thirty-four-year-old resident of Rapid City with a severe alcohol problem. Early on the morning of June 22, 2002, he arrived home in an extremely intoxicated condition after a night of partying. His noisy attempts to find something to eat woke up his live-in girlfriend and the two quarreled. The girlfriend called the police and officers Nustad and Dennis responded to the call.

[¶ 3.] Officer Nustad was the first officer on the scene. In order to separate the quarreling couple and evaluate the situation, Nustad had St. John step outside the residence and sit in the back of his patrol car. In the meantime, Officer Dennis arrived and spoke to St. John’s girlfriend by the front door of the residence. Officer Nustad joined the conversation and advised the girlfriend that the best option was to take St. John to Detox. Nustad then returned to his patrol car and told St. John that he was going to take him to Detox. St. John replied, “Okay, let’s go.” At that point, Officer Dennis approached the patrol car and told Nustad that St. John had some car keys that his girlfriend needed. Nustad opened the car door and asked St. John for the keys. St. John quickly got out of the vehicle, stood up, pulled the keys out of his right front pocket and then, in one continuous motion, stepped forward and punched Nustad in the chest with his right hand. Although he was taken by surprise, Nustad was able to step back and block another punch thrown by St. John. Nustad then pulled out his pepper spray and sprayed St. John in the face. By that time, Officer Dennis had come to Nustad’s aid and the two officers repeatedly instructed St. John to get down on the ground. St. John ignored their instructions and resisted their efforts to handcuff him. Eventually the officers wrestled St. John to the ground, handcuffed him behind his back, placed him in the patrol car and transported him to the county jail.

[¶ 4.] As a result of these events, St. John was charged with one count of aggravated assault under SDCL 22-18-1.1(3):

Any person who:
* * *
(3) Attempts to cause or knowingly causes any bodily injury to a law enforcement officer or other public officer engaged in the performance of the officer’s duties;
* * *
... is guilty of aggravated assault. Aggravated assault is a Class 3 felony.

[¶ 5.] St. John’s jury trial was on January 29, 2003 and the jury returned a guilty verdict. The trial court suspended the execution of an eight year penitentiary sentence and placed St. John on probation on various terms and conditions including 180 days confinement in the county jail. St. John appeals.

ISSUE

[¶ 6.] Did the trial court err in instructing the jury?

[¶ 7.] Given the absence of any evidence of actual bodily injury to a law enforcement officer, St. John’s counsel moved at the close of all the evidence that the case be submitted to the jury only on the question of whether St. John attempted to cause bodily injury to an officer. See SDCL 22-18-1.1(3). The trial court was initially reluctant to narrow the jury instructions, but eventually struck any proposals requiring a showing of actual bodily injury to a law enforcement officer. St. John’s counsel then proposed instructions on specific intent and diminished capacity. These proposals were rejected by the trial court on the basis that aggravated assault is a general intent crime. St. John argues that the trial court committed reversible error in rejecting his proposed jury instructions because the attempt element of SDCL 22-18-1.1(3) makes it a specific intent crime.

[¶ 8.] This Court reviews the refusal of proposed jury instructions under the abuse of discretion standard. See State v. Downing, 2002 SD 148, ¶ 26, 654 N.W.2d 793, 800 (citing State v. Webster, 2001 SD 141, ¶ 7, 637 N.W.2d 392, 394). Trial courts have broad discretion in instructing the jury and their instructions are satisfactory when, as a whole, they properly state the applicable law and inform the jury. Id.

[¶ 9.] The sufficiency of the jury instructions here turns on whether aggravated assault by attempting to cause bodily injury to a law enforcement officer is a specific or general intent crime. The law of specific versus general intent in the context of aggravated assault under SDCL 22-18-1.1 is relatively well-settled.

[¶ 10.] In State v. Rash, 294 N.W.2d 416 (S.D.1980), the defendant, like St. John, arrived at his home in a drunken stupor and engaged in a physical confrontation with his wife that resulted in her hospitalization. The defendant was convicted of aggravated assault under SDCL 22-18-1.1(1), attempting to cause or causing bodily injury to another under circumstances manifesting extreme indifference to the value of human life. During trial, the defendant proposed jury instructions on specific intent that were refused by the trial court. On appeal, the defendant argued that the word “attempts” in SDCL 22-18-1.1(1) required the State to prove that he had a specific criminal desire or intent. This Court disagreed observing that “attempt” merely meant that the defendant’s acts unequivocally demonstrated that a crime was about to be committed. The Court further observed that the Legislature may forbid the doing .of an act and make its commission a crime without regard to intent and that it left any words referring to a specific intent out of the statute. Accordingly, the Court concluded that specific intent on the part of the defendant was not an essential element of aggravated assault under SDCL 22-18-1.1(1) and that an instruction on specific intent was not required.

[¶ 11.] Rash was closely followed in State v. Schmiedt, 525 N.W.2d 253 (S.D.1994). Schmiedt also involved officers summoned to a domestic disturbance. On their arrival, the defendant made various threatening comments and began walking around the house carrying a handgun that he had kept within his reach. The defendant was later charged with aggravated assault under SDCL 22-18-1.1(5), attempting by physical menace with a deadly weapon to put another in fear of bodily harm. The defendant requested a jury instruction on specific intent which was refused by the trial court. On appeal, the defendant argued that the word attempt in SDCL 22-18-1.1(5) required a showing of specific intent. This Court followed Rash and concluded:

The same rationale is applicable to SDCL 22-18-l.l(5)(“attempts by physical menace with a deadly weapon to put another in fear of imminent serious bodily harm.”) It is silent as to intent and the only intent necessary is a general intent to try to put someone in fear by physical menace with a deadly weapon.

Schmiedt, 525 N.W.2d at 256.

[¶ 12.] State v. Barrientos, 444 N.W.2d 374 (S.D.1989) involved a charge of aggravated assault under SDCL 22-18-1.1(2), attempting to cause or knowingly causing bodily injury with a dangerous weapon. On appeal, the defendant questioned whether conviction under the “knowingly causes” portion of the statute required proof of a specific intent. Noting that the statute prescribed no additional mental state beyond the “knowledge” required to accompany the act causing bodily injury, the Court concluded that aggravated assault under the provision was a general intent crime. Barrientos, 444 N.W.2d at 376. That determination was reaffirmed in State v. Latham, 519 N.W.2d 68, 72 (S.D.1994) where this Court upheld a trial court determination that SDCL 22-18-1.1(2) contains no intent requirement.

[¶ 13.] In each of the foregoing cases, this Court held that aggravated assault was a general intent crime despite statutory language making an attempt an element of the offense. We reached this result because of the absence of any additional mental state required by the applicable statutory provisions. SDCL 22-18-1.1(3) also fails to require any additional mental state'. Thus, SDCL 22-18-1.1(3) defines only a general intent crime. Because aggravated assault under SDCL 22-18-1.1(3) is only a general intent crime, jury instructions on specific intent and diminished capacity in this case would have been inappropriate. See State v. Primeaux, 328 N.W.2d 256, 259 (S.D.1982). The trial court committed no abuse of discretion in refusing them.

[¶ 14.] Affirmed.

[¶ 15.] GILBERTSON, Chief Justice, and SABERS, KONENKAMP, ZINTER and MEIERHENRY, Justices, participating.