Chapter 47-30.2 Revised Uniform Unclaimed Property Act
CHAPTER 47-01 General Provisions
47-01-01. Ownership defined.
The ownership of a thing shall mean the right of one or more persons to possess and use it to the exclusion of others. In this code the thing of which there may be ownership is called property.
Source:
Civ. C. 1877, § 159; R.C. 1895, § 3266; R.C. 1899, § 3266; R.C. 1905, § 4702; C.L. 1913, § 5245; R.C. 1943, § 47-0101.
Derivation:
Cal. Civ. C., 654.
Notes to Decisions
Owner.
The owner of property is the one who has dominion of a thing, real or personal, corporeal or incorporeal, which he has a right to enjoy as he pleases, and to spoil or destroy it as far as the law permits, unless he is prevented by some agreement or covenant which restrains his right. Fleming v. Sherwood, 24 N.D. 144, 139 N.W. 101, 1912 N.D. LEXIS 17 (N.D. 1912).
Ownership.
Ownership is the right by which a thing belongs to an individual to the exclusion of all other persons. Fleming v. Sherwood, 24 N.D. 144, 139 N.W. 101, 1912 N.D. LEXIS 17 (N.D. 1912).
That which may be owned is property, and rights granted by statute may be owned. Iszler v. Jorda, 80 N.W.2d 665, 1957 N.D. LEXIS 95 (N.D. 1957).
Possessed and Used.
The term “possessed and used” is broader than the term “title” or the term “possession” and includes both. Fleming v. Sherwood, 24 N.D. 144, 139 N.W. 101, 1912 N.D. LEXIS 17 (N.D. 1912).
Law Reviews.
The North Dakota Land Trust, 45 N.D. L. Rev. 77 (1968).
Summary of significant decisions rendered by the North Dakota Supreme Court in 1989 relating to title to land, 65 N.D. L. Rev. 588 (1989).
47-01-02. Property — Classification.
Property is:
- Real or immovable; or
- Personal or movable.
Source:
Civ. C. 1877, § 162; R.C. 1895, § 3269; R.C. 1899, § 3269; R.C. 1905, § 4705; C.L. 1913, § 5248; R.C. 1943, § 47-0102.
Notes to Decisions
Affixation to Land.
Barn which was purchased and moved onto purchaser’s land and placed on blocks was not affixed to land as fixture but was personalty; purchaser had insurable interest in barn under fire policy even though land had been lost on execution sale before barn burned. Strobel v. Northwest G. F. Mut. Ins. Co., 152 N.W.2d 794, 1967 N.D. LEXIS 91 (N.D. 1967).
Defendant insured’s modular units as assembled and affixed to foundations for a motel were “real property” under this section and N.D.C.C. §§ 47-01-03 and 47-01-05; they therefore fell within the real property exception to the “damage to your product exclusion” in plaintiff insurer’s general liability policy. Scottsdale Ins. Co. v. Tri-State Ins. Co., 302 F. Supp. 2d 1100, 2004 U.S. Dist. LEXIS 2696 (D.N.D. 2004).
47-01-03. Real property defined.
Real or immovable property consists of:
- Land;
- That which is affixed to land, including manufactured homes as defined in section 41-09-02 with respect to which the requirements of subsection 6 of section 47-10-27 have been satisfied;
- That which is incidental or appurtenant to land; and
- That which is immovable by law.
Source:
Civ. C. 1877, § 163; R.C. 1895, § 3270; R.C. 1899, § 3270; R.C. 1905, § 4706; C.L. 1913, § 5249; R.C. 1943, § 47-0103; S.L. 2009, ch. 327, § 11; 2017, ch. 261, § 2, eff August 1, 2017.
Derivation:
Cal. Civ. C., 658.
Cross-References.
Real estate title by occupancy and accession, see N.D.C.C. ch. 47-06.
“Real property” defined, see N.D.C.C. § 1-01-49, subs. 6.
Notes to Decisions
- In General.
- Affixation to Land.
- Corporeal Hereditaments.
- Fixtures.
- Interest of Desert Entryman.
- Real Estate.
- Things Real.
In General.
Real property consists not only of land, but also of that which is affixed to land, that which is incidental or appurtenant to land, and that which is immovable by law. Mueller v. Mercer County, 60 N.W.2d 678, 1953 N.D. LEXIS 104 (N.D. 1953).
In an adversary proceeding seeking a declaration of rights under a gas and oil lease service agreement, the service agreement did not run with the land because it was not enough for the parties to call something a covenant that ran with the land, it was not an easement that was an estate in property or appurtenant to property, and the right to control produced oil and gas was not the grant of an interest in real property. Nine Pont Energy Holdings, Inc. v. Caliber Measurement Servs. LLC (In re Nine Point Energy Holdings Inc.), — B.R. —, — B.R. —, 2021 Bankr. LEXIS 1486 (Bankr. D. Del. June 1, 2021).
Affixation to Land.
Barn which was purchased and moved onto purchaser’s land and placed on blocks was not affixed to land as fixture but was personalty; purchaser had insurable interest in barn under fire policy even though land had been lost on execution sale before barn burned. Strobel v. Northwest G. F. Mut. Ins. Co., 152 N.W.2d 794, 1967 N.D. LEXIS 91 (N.D. 1967).
Defendant insured’s modular units as assembled and affixed to foundations for a motel were “real property” under this section and N.D.C.C. §§ 47-01-02 and 47-01-05; they therefore fell within the real property exception to the “damage to your product exclusion” in plaintiff insurer’s general liability policy. Scottsdale Ins. Co. v. Tri-State Ins. Co., 302 F. Supp. 2d 1100, 2004 U.S. Dist. LEXIS 2696 (D.N.D. 2004).
Corporeal Hereditaments.
Corporeal hereditaments are confined to land, and include not only the ground or soil, but everything which is attached to the earth, whether by course of nature or by the hand of man, and everything terrestrial, under or over it. Sox v. Miracle, 35 N.D. 458, 160 N.W. 716, 1916 N.D. LEXIS 174 (N.D. 1916).
Fixtures.
Fixtures, such as a barn, when permanently attached to the soil, are part of the real estate. Woolridge v. Torgrimson, 59 N.D. 307, 229 N.W. 805, 1930 N.D. LEXIS 143 (N.D. 1930).
Interest of Desert Entryman.
The interest of a desert-land entryman in public lands prior to his acquisition of a completed equitable title thereto is real property. Lower Yellowstone Irrigation Dist. v. Nelson, 71 N.D. 439, 2 N.W.2d 180, 1941 N.D. LEXIS 184 (N.D. 1941).
Real Estate.
The term “real estate” means an estate in fee or for life in land, and does not comprehend terms for years or any interest short of a freehold. Sox v. Miracle, 35 N.D. 458, 160 N.W. 716, 1916 N.D. LEXIS 174 (N.D. 1916).
Things Real.
Things real consist of lands, tenements, and hereditaments, the latter meaning anything capable of being inherited, either corporeal, incorporeal, real, personal, or mixed. Sox v. Miracle, 35 N.D. 458, 160 N.W. 716, 1916 N.D. LEXIS 174 (N.D. 1916).
Collateral References.
Solid mineral royalty as real or personal property, 68 A.L.R.2d 728, 735.
Manure as real or personal property as between seller and buyer of real property, 82 A.L.R.2d 1099.
Wills: term “money” or “moneys” in will as including real property, 76 A.L.R.3d 1254.
47-01-04. Land defined.
Land is the solid material of the earth, whatever may be the ingredients of which it is composed, whether soil, rock, or other substance.
Source:
Civ. C. 1877, § 164; R.C. 1895, § 3271; R.C. 1899, § 3271; R.C. 1905, § 4707; C.L. 1913, § 5250; R.C. 1943, § 47-0104.
Derivation:
Cal. Civ. C., 659.
Notes to Decisions
Compensation for Use of Pore Space.
When the provisions of N.D.C.C. §§ 38-11.1-04, 47-01-04, and 47-01-12 are read together, pore space is part of the surface owner's interest in the land for purposes of N.D.C.C. § 38-11.1-04. The Supreme Court of North Dakota concludes a surface owner may be entitled to compensation under N.D.C.C. § 38-11.1-04 for a mineral developer's use of the surface owner's subsurface pore space for disposal of saltwater generated as a result of drilling operations. 2017 ND 169, 2017 N.D. LEXIS 170.
47-01-05. Fixtures defined.
A thing is deemed to be affixed to land when it is attached to it by roots, as in the case of trees, vines, or shrubs, or imbedded in it, as in the case of walls, or permanently resting upon it, as in the case of buildings, or permanently attached to what is thus permanent, as by means of cement, plaster, nails, bolts, or screws.
Source:
Civ. C. 1877, § 165; R.C. 1895, § 3272; R.C. 1899, § 3272; R.C. 1905, § 4708; C.L. 1913, § 5251; R.C. 1943, § 47-0105.
Derivation:
Cal. Civ. C., 660.
Notes to Decisions
- Determination of Fixture.
- “Improvement to Real Property.”
- “Permanently Resting” Defined.
- Railroad Tracks.
- Realty or Personalty.
- What Constitutes a Fixture.
Determination of Fixture.
An agreement that an article annexed to realty may be removed by the tenant, thereby rendering inapplicable the common-law rules governing fixtures, may be entered into after annexation. Warner v. Intlehouse, 60 N.D. 542, 235 N.W. 638, 1931 N.D. LEXIS 201 (N.D. 1931).
In determining whether personal property became a fixture under the statute, the court will look into the intention of the persons making the annexation, the manner in which the article or building is annexed, and its adaptation to the use of realty. Gray v. Krieger, 66 N.D. 115, 262 N.W. 343, 1935 N.D. LEXIS 176 (N.D. 1935).
In determining whether personalty has become a fixture under this section, court will look to intention of person making the annexation, the manner in which building is annexed, and its adaptation to use of realty. Strobel v. Northwest G. F. Mut. Ins. Co., 152 N.W.2d 794, 1967 N.D. LEXIS 91 (N.D. 1967).
Notwithstanding the physical characteristics of a fixture, the parties may agree that it is personal property; however, such an agreement is not binding upon subsequent purchasers or mortgagees in good faith, without notice of the agreement. Conversely, a subsequent purchaser or mortgagee who joins in or has notice of the agreement is ordinarily bound thereby. Lundgren v. Mohagen, 426 N.W.2d 563, 1988 N.D. LEXIS 244 (N.D. 1988).
The determination whether there has been an agreement to treat fixtures as personalty is a question of fact. Marsh v. Binstock, 462 N.W.2d 172, 1990 N.D. LEXIS 225 (N.D. 1990).
Notwithstanding the physical characteristics of a fixture, parties may agree to give it the legal character of personalty. Marsh v. Binstock, 462 N.W.2d 172, 1990 N.D. LEXIS 225 (N.D. 1990).
Where contract for deed valued milking equipment at $8,000, and tax statement filed at time of sale stated that personal property valued at $8,000 was included, issue of material fact existed concerning whether vendor and purchaser agreed to treat milking equipment attached to barn as personalty precluding summary judgment in conversion action arising when equipment was sold by purchaser. Marsh v. Binstock, 462 N.W.2d 172, 1990 N.D. LEXIS 225 (N.D. 1990).
House was considered a fixture while it was being raised to have the foundation replaced where the intention was to have the house remain on the property permanently. Grinnell Mut. Reinsurance Co. v. Lynne, 2004 ND 166, 686 N.W.2d 118, 2004 N.D. LEXIS 293 (N.D. 2004).
“Improvement to Real Property.”
It was unnecessary to define the term “improvement to real property” because only one conclusion — that the grain bin was an improvement to real property — could reasonably be drawn, where the bin was a 10,000-bushel bin anchored to a cement slab by bolts, with a perforated floor nine inches above the cement slab upon which the bin rested, part of a grain-handling system which also consisted of two additional 10,000-bushel bins, a 3,500-bushel overhead bin, two hopper bins, and a leg, and since the bin was erected in 1967, the owner had never moved it or removed any of the anchors. Bellemare v. Gateway Builders, 420 N.W.2d 733, 1988 N.D. LEXIS 51 (N.D. 1988).
“Permanently Resting” Defined.
Under a statute including as realty what is affixed to the land, and providing that it is deemed to be affixed when permanently resting on it, the term “permanently resting” contrasts with transient or temporary. Nelson v. Kloster, 68 N.D. 108, 277 N.W. 390, 1938 N.D. LEXIS 88 (N.D. 1938).
Railroad Tracks.
While it may be true that railroad tracks are generally held to be personal property, when railroad tracks are placed on mining property a disputable presumption arises that they are part of the realty and an agreement to make them personal property is binding on a purchaser only if the purchaser has notice, actual or constructive, thereof. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
Realty or Personalty.
Parties may by agreement give to fixtures the legal character of realty or personalty at their option. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
Whether or not an agreement to treat fixtures as personalty is binding on a purchaser of the land depends on notice of the agreement to the purchaser. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
An agreement to give fixtures the legal character of personalty avails as against a purchaser of the land with notice thereof, actual or constructive. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
When an owner of realty and fixtures sells the fixtures separate from the real estate, a constructive severance occurs and the fixtures become personal property. Marsh v. Binstock, 462 N.W.2d 172, 1990 N.D. LEXIS 225 (N.D. 1990).
What Constitutes a Fixture.
A light plant in the basement of a farm dwelling house, with necessary equipment, and a hay carrier attached to a barn, with necessary equipment, are fixtures. Klocke v. Troske, 57 N.D. 404, 222 N.W. 262, 1928 N.D. LEXIS 144 (N.D. 1928).
Windmills, wells, and fences ordinarily are fixtures. Hasse v. Dewitz, 76 N.D. 108, 33 N.W.2d 625, 1948 N.D. LEXIS 63 (N.D. 1948).
Barn which was purchased and moved onto purchaser’s land and placed on blocks was not affixed to land as fixture but was personalty; purchaser had insurable interest in barn under fire policy even though land had been lost on execution sale before barn burned. Strobel v. Northwest G. F. Mut. Ins. Co., 152 N.W.2d 794, 1967 N.D. LEXIS 91 (N.D. 1967).
At time of sale, physical characteristics of milking equipment were characteristic of fixtures as equipment was permanently attached to barn by screws, electric wiring and separate piping for water and freon and equipment was specifically adapted to the use of the realty. Marsh v. Binstock, 462 N.W.2d 172, 1990 N.D. LEXIS 225 (N.D. 1990).
Defendant insured’s modular units as assembled and affixed to foundations for a motel were “real property” under this section and N.D.C.C. §§ 47-01-02 and 47-01-03; they therefore fell within the real property exception to the “damage to your product exclusion” in plaintiff insurer’s general liability policy. Scottsdale Ins. Co. v. Tri-State Ins. Co., 302 F. Supp. 2d 1100, 2004 U.S. Dist. LEXIS 2696 (D.N.D. 2004).
Collateral References.
Condemnation of land, separate valuation on, 1 A.L.R.2d 878.
Plumbing and heating materials delivered to premises but not installed, doctrine of constructive annexation as applied to, 10 A.L.R.2d 207.
Sprinkler system as fixture, 19 A.L.R.2d 1300, 1314.
Amusement apparatus or device as fixture, 41 A.L.R.2d 664.
Plumbing: appliances, accessories, pipes, or other articles connected with plumbing, as fixtures, 52 A.L.R.2d 222.
Carpets, linoleum, or the like, as fixtures, 55 A.L.R.2d 1044, 1048.
Electric range as fixture, 57 A.L.R.2d 1103.
Electronic computing equipment as fixture, 6 A.L.R.3d 497.
Insurance: what are “fixtures” within provision of property insurance policy expressly extending coverage to fixtures, 17 A.L.R.3d 1381.
Air-conditioning appliance, equipment, or apparatus as fixture, 69 A.L.R.4th 359.
Law Reviews.
Actions Arising out of Improvements to Real Property: Special Statutes of Limitations, 57 N.D. L. Rev. 43 (1981).
47-01-06. Appurtenances defined.
A thing is deemed to be incidental or appurtenant to land when it by right is used with the land for its benefit, as in the case of a way or watercourse, or of a passage for light, air, or heat from or across the land of another. Sluice boxes, flumes, hose, pipes, railway tracks, cars, blacksmith shops, mills, and all other machinery or tools used in working or developing a mine are deemed affixed to the mine.
Source:
Civ. C. 1877, § 166; R.C. 1895, § 3273; R.C. 1899, § 3273; R.C. 1905, § 4709; C.L. 1913, § 5252; R.C. 1943, § 47-0106.
Derivation:
Cal. Civ. C., 662.
Notes to Decisions
In General.
Fact that the railway tracks and the mine were owned by different parties is not dispositive of whether or not the tracks were “used in working or developing a mine”. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
“By Right”.
The words “by right” in this section are sufficiently broad to encompass a contractual right. Burlington N. R.R. v. Scheid, 398 N.W.2d 114, 1986 N.D. LEXIS 444 (N.D. 1986).
Collateral References.
Insurance: what are “appurtenant” private structures within provision of property insurance policy expressly extending coverage to such structures, 43 A.L.R.3d 1351.
47-01-07. Personal property defined.
Personal property shall mean and include every kind of property that is not real.
Source:
Civ. C. 1877, § 167; R.C. 1895, § 3274; R.C. 1899, § 3274; R.C. 1905, § 4710; C.L. 1913, § 5253; R.C. 1943, § 47-0107.
Derivation:
Cal. Civ. C., 663.
Cross-References.
“Personal property” defined, see N.D.C.C. § 1-01-49, subs. 7.
Notes to Decisions
Affixation to Land.
Barn which was purchased and moved onto purchaser’s land and placed on blocks was not affixed to land as fixture but was personalty; purchaser had insurable interest in barn under fire policy even though land had been lost on execution sale before barn burned. Strobel v. Northwest G. F. Mut. Ins. Co., 152 N.W.2d 794, 1967 N.D. LEXIS 91 (N.D. 1967).
Choses in Action.
Choses in action are personal property. Sykes v. Hannawalt, 5 N.D. 335, 65 N.W. 682, 1895 N.D. LEXIS 35 (N.D. 1895).
Equitable Lien.
The equitable lien on the distributee’s share, through which the estate could have collected its debt, was property and, as such, could be transferred. Aberle v. Merkel, 70 N.D. 89, 291 N.W. 913, 1940 N.D. LEXIS 150 (N.D. 1940).
Injury to Property.
The payment by the father of the funeral expenses of a son killed by wrongful acts of another impaired his total assets in that amount and was an injury to property. Iszler v. Jorda, 80 N.W.2d 665, 1957 N.D. LEXIS 95 (N.D. 1957).
The right of parents to the services of minor unmarried children is property by statutory definition, and the destruction of that right is an injury to property. Iszler v. Jorda, 80 N.W.2d 665, 1957 N.D. LEXIS 95 (N.D. 1957).
Collateral References.
What passes under term “personal property” in will, 31 A.L.R.5th 499.
47-01-08. What may be subject to ownership.
There may be ownership of the following:
- All inanimate things which are capable of appropriation or of manual delivery.
- All domestic animals.
- All obligations.
- Such products of labor or skill as the composition of an author, the good will of a business, trademarks, signs, and of rights created or granted by statute.
- Animals, wild by nature, only when on the land of the person claiming them, or when tamed, taken and held in possession, or disabled and immediately pursued.
Source:
Civ. C. 1877, §§ 160, 161; S.L. 1891, ch. 101, § 1; R.C. 1895, §§ 3267, 3268; R.C. 1899, §§ 3267, 3268; R.C. 1905, §§ 4703, 4704; C.L. 1913, §§ 5246, 5247; R.C. 1943, § 47-0108.
Derivation:
Cal. Civ. C., 655, 656.
Notes to Decisions
Good Will.
The good will of a business is property. Mapes v. Metcalf, 10 N.D. 601, 88 N.W. 713, 1901 N.D. LEXIS 80 (N.D. 1901).
Land Beneath Water.
Land underlying the water of an inland nonnavigable lake is the subject of private ownership. Brignall v. Hannah, 34 N.D. 174, 157 N.W. 1042, 1916 N.D. LEXIS 22 (N.D. 1916).
Lottery Right.
The player of a pinball machine acquires the right to receive free games if he wins, and this right, being subject to ownership, is property. Middlemas v. Strutz, 71 N.D. 186, 299 N.W. 589, 1941 N.D. LEXIS 151 (N.D. 1941).
Services of Child.
The right of parents to the earnings and services of an unmarried minor child is property subject to ownership. Iszler v. Jorda, 80 N.W.2d 665, 1957 N.D. LEXIS 95 (N.D. 1957).
Collateral References.
Contract, property rights in, as basis of liability for inducing breach of, 26 A.L.R.2d 1227.
Liability for interference with invalid or unenforceable contract, 96 A.L.R.3d 1294.
Punitive damages for interference with contract or business relationship, 44 A.L.R.4th 1078.
Who “harbors” or “keeps” dog under animal liability statute, 64 A.L.R.4th 963.
Liability for injuries caused by cat, 68 A.L.R.4th 823.
Law Reviews.
Good Will, 4 Dak. L. Rev. 15 (1932).
47-01-09. Public or private ownership — All property subject to.
All property in this state has an owner, whether that owner is the United States or the state, and the property public, or the owner an individual, and the property private. The state also may hold property as a private proprietor.
Source:
Civ. C. 1877, § 168; R.C. 1895, § 3275; R.C. 1899, § 3275; R.C. 1905, § 4711; C.L. 1913, § 5254; R.C. 1943, § 47-0109.
Derivation:
Cal. Civ. C., 669.
47-01-10. State ownership — Property appropriated or dedicated — Property having no owner.
The state is the owner of all property lawfully appropriated or dedicated to its own use and of all property of which there is no other owner.
Source:
Civ. C. 1877, § 169; R.C. 1895, § 3276; R.C. 1899, § 3276; R.C. 1905, § 4712; C.L. 1913, § 5255; R.C. 1943, § 47-0110.
Derivation:
Cal. Civ. C., 670.
Law Reviews.
Modern Escheat Statutes Dealing With Unclaimed Intangible Personal Property, 42 N.D. L. Rev. 441 (1966).
47-01-11. Private ownership — Persons qualified — Citizen — Alien.
Except as provided in chapter 47-10.1, any person, whether citizen or alien, may take, hold, and dispose of property, real or personal, within this state.
Source:
Civ. C. 1877, § 170; R.C. 1895, § 3277; R.C. 1899, § 3277; R.C. 1905, § 4713; C.L. 1913, § 5256; R.C. 1943, § 47-0111; S.L. 1979, ch. 484, § 7.
Derivation:
Cal. Civ. C., 671.
47-01-12. Scope of ownership — Above and below surface.
The owner of land in fee has the right to the surface and to everything permanently situated beneath or above it.
Source:
Civ. C. 1877, § 265; R.C. 1895, § 3372; R.C. 1899, § 3372; R.C. 1905, § 4808; C.L. 1913, § 5351; R.C. 1943, § 47-0112.
Derivation:
Cal. Civ. C., 829.
Cross-References.
Ownership of space over lands and waters of state in owners of surface beneath, see N.D.C.C. § 2-03-03.
Notes to Decisions
Encroachments.
In a property owner’s suit against adjoining owners for damage allegedly caused to his building by encroaching tree branches, N.D.C.C. § 47-01-17 was the more specific statute and thus governed over N.D.C.C. § 47-01-12 to the extent of any conflict, in accordance with N.D.C.C. § 1-02-07. The adjoining owners exclusively owned the tree, including the portions that encroached, and had a corresponding responsibility to maintain the entire tree. Herring v. Lisbon, 2012 ND 226, 823 N.W.2d 493, 2012 N.D. LEXIS 222 (N.D. 2012).
Collateral References.
Oil and gas royalty as real or personal property, 56 A.L.R.4th 539.
Treasure trove, modern status of rules as to ownership as between finder and owner of property on which found, 61 A.L.R.4th 1180.
47-01-13. Ownership of land includes water. [Repealed]
Repealed by S.L. 1963, ch. 419, § 7.
47-01-14. Land below high water mark — Regulated by federal or state law. [Repealed]
Repealed by S.L. 1995, ch. 435, § 2.
47-01-15. Banks and beds of streams — Boundary of ownership.
Except when the grant under which the land is held indicates a different intent, the owner of the upland, when it borders on a navigable lake or stream, takes to the edge of the lake or stream at low water mark. All navigable rivers shall remain and be deemed public highways. In all cases when the opposite banks of any stream not navigable belong to different persons, the stream and the bed thereof shall become common to both.
Source:
Civ. C. 1877, § 266; R.C. 1895, § 3373; R.C. 1899, § 3373; R.C. 1905, § 4809; C.L. 1913, § 5352; R.C. 1943, § 47-0115.
Derivation:
Cal. Civ. C., 830.
Cross-References.
Ownership of riparian accretions, see N.D.C.C. § 47-06-05.
Notes to Decisions
- Boundary of Ownership.
- Comparison with Federal Law.
- Doctrine of Reliction and Ambulatory High Water Mark.
- Effect of Meander Line.
- Land Between High and Low water marks.
- Missouri River.
- Nonnavigable Streams.
- Public Lands.
- Public Trust and Equal Footing Doctrines.
- Public Water.
- Purpose.
- State Title.
Boundary of Ownership.
Absent a contrary intent, the grant under which the [riparian] land is held includes a riparian grantee’s full interest in the shore zone, and necessarily precludes the state’s claim of absolute ownership to the high watermark; however, the equal footing and public trust doctrines establish that the state cannot totally abdicate its interest to the high watermark, and that a riparian landowner’s interest to the law watermark is not absolute. State ex rel. Sprynczynatyk v. Mills, 523 N.W.2d 537, 1994 N.D. LEXIS 224 (N.D. 1994).
Comparison with Federal Law.
While federal law extends an upland owner’s rights only to the ordinary high water mark, North Dakota law provides that an upland owner “takes to the edge of the lake … at low watermark.”101 Ranch v. United States, 714 F. Supp. 1005, 1988 U.S. Dist. LEXIS 16413 (D.N.D. 1988), aff'd, 905 F.2d 180, 1990 U.S. App. LEXIS 8644 (8th Cir. N.D. 1990).
It is not entirely clear from the language of this section whether it grants upland owners title or only a license or easement down to the ordinary low watermark, but it is apparent that North Dakota law would extend some interest or rights to upland owners not provided under federal law. 101 Ranch v. United States, 714 F. Supp. 1005, 1988 U.S. Dist. LEXIS 16413 (D.N.D. 1988), aff'd, 905 F.2d 180, 1990 U.S. App. LEXIS 8644 (8th Cir. N.D. 1990).
Doctrine of Reliction and Ambulatory High Water Mark.
For discussion of evidence sufficient to warrant application of the doctrine of reliction and an ambulatory high watermark to determine the boundary of a navigable body of water. In re Ownership of Bed of Devils Lake, 423 N.W.2d 141, 1988 N.D. LEXIS 113 (N.D. 1988).
Effect of Meander Line.
Where an irregular tract of land abuts upon a stream, and a meander line is run ostensibly along the shore line for the purpose of fixing the area of this tract, the real boundary is the shore line and not the meander line. Heald v. Yumisko, 7 N.D. 422, 75 N.W. 806, 1898 N.D. LEXIS 91 (N.D. 1898); Gardner v. Green, 67 N.D. 268, 271 N.W. 775, 1937 N.D. LEXIS 80 (N.D. 1937); Oberly v. Carpenter, 67 N.D. 495, 274 N.W. 509, 1937 N.D. LEXIS 105 (N.D. 1937).
A water line, rather than a meander line, ordinarily forms the boundary of a tract of land abutting a navigable body of water. In re Ownership of Bed of Devils Lake, 423 N.W.2d 141, 1988 N.D. LEXIS 113 (N.D. 1988).
Land Between High and Low water marks.
This section is a rule of construction under which an upland owner “takes” the interest granted in a conveying instrument to the low watermark, except when the grant under which the land is held indicates a different intent. The interests of a riparian grantee and the state in the area between the ordinary high watermark and the ordinary low watermark were not absolute, and that both parties had correlative interests in that area. North Shore v. Wakefield, 530 N.W.2d 297, 1995 N.D. LEXIS 52 (N.D. 1995).
Missouri River.
The state of North Dakota holds title to the bed of the Missouri River, which includes underlying oil and gas. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
State law was determinative of a dispute over mineral rights in and under the shore zone of the Missouri River. The federal district court found that abstention was appropriate and warranted in order to allow the state courts of North Dakota to decide unsettled issues of state law. Brigham Oil & Gas, L.P. v. N.D. Bd. of Univ. & Sch. Lands, 866 F. Supp. 2d 1082, 2012 U.S. Dist. LEXIS 77575 (D.N.D. 2012).
Nonnavigable Streams.
The owner of the banks along a nonnavigable stream owns the bed of the stream to its center or thread. Amoco Oil Co. v. State Highway Dep't, 262 N.W.2d 726, 1978 N.D. LEXIS 211 (N.D. 1978).
Public Lands.
Where public lands bounded on a stream are patented by the United States without reservations or restrictions, the riparian rights of the patentee are determined by the law of the state in which the lands lie. Oberly v. Carpenter, 67 N.D. 495, 274 N.W. 509, 1937 N.D. LEXIS 105 (N.D. 1937).
Public Trust and Equal Footing Doctrines.
Although a riparian landowner may claim absolute ownership of the land above the ordinary high watermark and the state may claim absolute ownership of the land below the ordinary low watermark via the public trust and equal footing doctrines, those doctrines and this section do not contemplate absolute ownership of the shore zone by either party; both parties have correlative interests in the shore zone. Under the public trust and equal footing doctrines, the state has interests in the shore zone which involve more than a navigational servitude, and under this section a riparian owner “takes” more than the mere right of access to the water. State ex rel. Sprynczynatyk v. Mills, 523 N.W.2d 537, 1994 N.D. LEXIS 224 (N.D. 1994).
State owned the mineral interests under the shore zone of navigable waters upon statehood in 1889 under the equal footing doctrine, and the enduring language of the anti-gift clause found in N.D. Const. art. X, § 18 precluded construing the language codified in N.D.C.C. § 47-01-15 as a gift of the State’s mineral interests under the shore zone to the upland owners; however, an upland owner was not precluded from taking to the low watermark if the chain of title established that the State had granted its equal footing interest to an upland owner. Reep v. State, 2013 ND 253, 841 N.W.2d 664, 2013 N.D. LEXIS 259 (N.D. 2013).
Public Water.
If an inland lake is navigable in fact, it is a public water. Roberts v. Taylor, 47 N.D. 146, 181 N.W. 622, 1921 N.D. LEXIS 99 (N.D. 1921); Rutten v. State, 93 N.W.2d 796, 1958 N.D. LEXIS 106 (N.D. 1958).
Purpose.
This section does not grant a riparian landowner absolute ownership of the shore zone, but is a rule of construction for determining the boundary for grants of riparian land and is not itself an absolute grant of ownership to the low watermark. State ex rel. Sprynczynatyk v. Mills, 523 N.W.2d 537, 1994 N.D. LEXIS 224 (N.D. 1994).
State Title.
As patented lands riparian to a navigable stream are eroded and washed away by the action of the water and become submerged below low watermark the title to such submerged lands passes by operation of law to the state. Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
The title of the state to lands below the low watermark of a navigable stream is coextensive with the bed of the stream as it may exist from time to time. Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
The state of North Dakota holds title to the bed of the Missouri River, which includes underlying oil and gas. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
Collateral References.
Apportionment and division of area of river as between riparian tracts fronting on same bank, in absence of agreement or specification, 65 A.L.R.2d 143.
Rights to land created at water’s edge by filling or dredging, 91 A.L.R.2d 857.
Right to accretion built up from one tract of land and extending laterally in front of adjoining tract without being contiguous thereto, 61 A.L.R.3d 1173.
Riparian owner’s right to new land created by reliction or accretion influenced by artificial condition not produced by such owner, 63 A.L.R.3d 249.
Law Reviews.
The Nature and Extent of Rights in Water in North Dakota, 51 N.D. L. Rev. 249 (1975).
North Dakota Century Code § 47-01-15
North Dakota Waterways: The Public’s Right of Recreation and Questions of Title, 64 N.D. L. Rev. 7 (1988).
47-01-16. Road or street — Boundary of ownership.
An owner of land bounded by a road or street is presumed to own to the center of the way, but the contrary may be shown.
Source:
Civ. C. 1877, § 267; R.C. 1895, § 3374; R.C. 1899, § 3374; R.C. 1905, § 4810; C.L. 1913, § 5353; R.C. 1943, § 47-0116.
Derivation:
Cal. Civ. C., 831.
Cross-References.
Transfer of land bounded by highway passes title to center of highway unless different intent appears from grant, see N.D.C.C. § 47-10-10.
Notes to Decisions
Eminent Domain.
City exercising its authority to create pedestrian malls pursuant to section 40-62-01 must initiate eminent domain proceedings to compensate abutting property owners since those owners are presumed to hold fee ownership in the street. City of Fargo v. Fahrlander, 199 N.W.2d 30, 1972 N.D. LEXIS 155 (N.D. 1972).
Land Owner’s Interest in Roads.
Court properly granted summary judgment to an insurer in a declaratory judgment action where a semi-truck was not covered under a farmer’s policy because an exclusion contained limited exceptions which did not provide coverage for motor vehicles on public roads or highways. The semi-truck was indisputably driven on public roads and it was irrelevant whether the state’s interest in highway abutting insured’s property was treated as an easement or a fee interest and N.D.C.C. § 47-01-16 did not operate to extend coverage, as the collision occurred more than two miles from the insured’s farm, and the driver had to cross several strips of highway that did not abut land owned by insured. The language of the policy precluded coverage for the semi-truck because it was designed for travel on public roads and subject to motor vehicle registration. Nationwide Mut. Ins. Cos. v. Lagodinski, 2004 ND 147, 683 N.W.2d 903, 2004 N.D. LEXIS 279 (N.D. 2004).
Pursuant to N.D.C.C. § 47-01-16, summary judgment was improper on plaintiff’s premises liability claim because it could not be determined as a matter of law that the landowner had no control over the premises on which the injury occurred or over the condition which allegedly caused the injury. Saltsman v. Sharp, 2011 ND 172, 803 N.W.2d 553, 2011 N.D. LEXIS 172 (N.D. 2011).
Collateral References.
Description with reference to highway as carrying title to center or side of highway, 49 A.L.R.2d 982.
Tree or limb falling onto adjoining private property, personal injury or property damage liability, 54 A.L.R.4th 530.
47-01-17. Tree occupying lands of adjacent owner — Ownership determined from trunk.
Trees whose trunks stand wholly upon the land of one owner belong exclusively to that owner although their roots grow into the land of another. Trees whose trunks stand partly on the land of two or more coterminous owners belong to them in common.
Source:
Civ. C. 1877, §§ 269, 270; R.C. 1895, §§ 3376, 3377; R.C. 1899, §§ 3376, 3377; R.C. 1905, §§ 4812, 4813; C.L. 1913, §§ 5355, 5356; R.C. 1943, § 47-0117.
Derivation:
Cal. Civ. C., 833, 834.
Notes to Decisions
Liability of Owner.
In a property owner’s suit against adjoining owners for damage allegedly caused to his building by encroaching tree branches, N.D.C.C. § 47-01-17 was the more specific statute and thus governed over N.D.C.C. § 47-01-12 to the extent of any conflict, in accordance with N.D.C.C. § 1-02-07. The adjoining owners exclusively owned the tree, including the portions that encroached, and had a corresponding responsibility to maintain the entire tree. Herring v. Lisbon, 2012 ND 226, 823 N.W.2d 493, 2012 N.D. LEXIS 222 (N.D. 2012).
Collateral References.
Measure of damages for destruction of or injury to trees and shrubbery, 69 A.L.R.2d 1335.
Rights and liabilities of adjoining landowners as to trees, shrubbery, or similar plants growing on boundary line, 26 A.L.R.3d 1372.
Measure of damages for destruction of or injury to fruit, nut, or other productive trees, 90 A.L.R.3d 800.
Measure of damages for injury to or destruction of shade or ornamental tree or shrub, 95 A.L.R.3d 508.
Tree or limb falling onto adjoining private property, personal injury or property damage liability, 54 A.L.R.4th 530.
47-01-18. Lateral and adjacent support.
Each coterminous owner is entitled to the lateral and adjacent support which that owner’s land receives from the adjoining land, subject to the right of the owner of the adjoining land to make proper and usual excavations on the same for purposes of construction on using ordinary care and skill, taking precautions to sustain the land of the other, and giving previous reasonable notice to the other of the intention to make such excavations.
Source:
Civ. C. 1877, § 268; R.C. 1895, § 3375; R.C. 1899, § 3375; R.C. 1905, § 4811; C.L. 1913, § 5354; R.C. 1943, § 47-0118.
Derivation:
Cal. Civ. C., 832.
Cross-References.
Right of receiving more than natural support as easement, see N.D.C.C. § 47-05-01.
Notes to Decisions
- Buildings and Other Structures.
- Failure to Give Notice.
- “Land” Defined.
- Purpose of Notice.
- Scope of Right to Support.
Buildings and Other Structures.
Where removal of lateral support has affected a building or other structure on adjoining land, this section, which applies only to the support of “land”, does not alter the common law, and in order to incur liability, the excavating owner must have failed to use ordinary care and skill in accomplishing his task. Hermanson v. Morrell, 252 N.W.2d 884, 1977 N.D. LEXIS 254 (N.D. 1977).
Failure to Give Notice.
Failure to give the notice which is required by this statute is evidence of negligence, but where plaintiff had personal knowledge of the excavation, the failure to give statutory notice of the excavation is not decisive of the issue of liability. Malmstad v. McHenry Tel. Co., 29 N.D. 21, 149 N.W. 690, 1914 N.D. LEXIS 4 (N.D. 1914).
“Land” Defined.
The term “land” as used in this section is subject to the definition found in N.D.C.C. § 47-01-04. Hermanson v. Morrell, 252 N.W.2d 884, 1977 N.D. LEXIS 254 (N.D. 1977).
Purpose of Notice.
The purpose of the notice provision of this statute is to enable the adjacent landowner to take steps for his protection if his neighbor has failed to do so. Malmstad v. McHenry Tel. Co., 29 N.D. 21, 149 N.W. 690, 1914 N.D. LEXIS 4 (N.D. 1914).
Scope of Right to Support.
This section does not grant to real property owners an absolute right to lateral support of their land, but rather a right to such support “subject to” the rights of adjoining landowners to excavate, provided they limit the excavation to those things which are proper and usual, do the work with ordinary care and skill, take precautions to sustain their neighbor’s land, and give the neighbor reasonable notice of their intent to excavate; but where an excavator fails to comply with any of the above conditions, he will be absolutely liable for any damages which result to his neighbor’s land, as at common law. Hermanson v. Morrell, 252 N.W.2d 884, 1977 N.D. LEXIS 254 (N.D. 1977).
Collateral References.
Liability of employer for injury to adjoining realty resulting from excavation work by independent contractor on his premises, 33 A.L.R.2d 111.
Measure of damages for loss of or interference with lateral support, 36 A.L.R.2d 1253.
Liability of excavators for damages to noncoterminous tract from removal of lateral support, 87 A.L.R.2d 710.
Dredging, liability for damages to adjacent land or building caused by, 62 A.L.R.3d 526.
47-01-19. Boundaries — Obligation of coterminous owners.
Coterminous owners are mutually bound to maintain equally the boundaries and monuments between them.
Source:
Civ. C. 1877, § 272; R.C. 1895, § 3379; R.C. 1899, § 3379; R.C. 1905, § 4815; C.L. 1913, § 5358; R.C. 1943, § 47-0119.
Derivation:
Cal. Civ. C., 841.
Cross-References.
Partition fences maintained by owners and occupants of land, see N.D.C.C. § 47-26-05.
47-01-20. Extent of ownership — Products and accessions.
The owner of a thing also owns all its products and accessions.
Source:
Civ. C. 1877, § 209; R.C. 1895, § 3316; R.C. 1899, § 3316; R.C. 1905, § 4752; C.L. 1913, § 5295; R.C. 1943, § 47-0120.
Derivation:
Cal. Civ. C., 732.
Notes to Decisions
Rebuttable Presumption.
The presumption that the owner of land owns a crop growing thereon may be overcome by proof that he has sold the crop, or other evidence to the contrary. Ellestad v. Northwestern Elevator Co., 6 N.D. 88, 69 N.W. 44, 1896 N.D. LEXIS 11 (N.D. 1896).
Things Added to Realty.
The word “accessions” applies to things added to the realty. Golden Valley Land & Cattle Co. v. Johnstone, 21 N.D. 101, 128 N.W. 691, 1910 N.D. LEXIS 145 (N.D. 1910).
Collateral References.
Motor vehicle, accession to, 43 A.L.R.2d 813.
47-01-21. Methods by which property may be acquired.
Property may be acquired by:
- Occupancy;
- Accession;
- Transfer;
- Will; or
- Succession.
Source:
Civ. C. 1877, § 580; R.C. 1895, § 3489; R.C. 1899, § 3489; R.C. 1905, § 4925; C.L. 1913, § 5468; R.C. 1943, § 47-0121.
Derivation:
Cal. Civ. C., 1000.
Cross-References.
Real estate title by occupancy and accession, see N.D.C.C. ch. 47-06.
Real property transfers, see N.D.C.C. ch. 47-10.
Notes to Decisions
Occupancy.
Possession does not constitute title, at least not until it has ripened into title, or adverse actions are barred by the statute of limitations. The fact that possession furnishes a presumption of title does not preclude the adverse party from showing a lack of title. Goss v. Herman, 20 N.D. 295, 127 N.W. 78, 1910 N.D. LEXIS 84 (N.D. 1910).
The right to maintain an action to remove a cloud upon the title to a nonpossessory interest in real property is a continuing right and a statute of limitations affecting such a right of action does not commence to run as long as the possession of the property is consistent with the nonpossessory interest. Yttredahl v. Federal Farm Mtg. Corp., 104 N.W.2d 705 (N.D. 1960); Wisness v. Paniman, 120 N.W.2d 594, 1963 N.D. LEXIS 76 (N.D. 1963).
47-01-22. Temporary easements to contain fixed termination date.
Whenever a temporary easement is acquired by the state or any of its agencies, departments, or institutions, or any political subdivision of the state in connection with highway or road construction or for any other purpose, a fixed date of termination shall be stated in such temporary easement, which date shall not be more than five years from the date of the easement.
Source:
S.L. 1965, ch. 310, § 1.
47-01-23. Landowner immunity — Use and condition of roads.
A landowner may not be held liable for a claim resulting from the use or condition of a road across the landowner’s property unless the landowner is primarily and directly responsible for the construction and maintenance of the road or an affirmative act of the landowner causes or contributes to the claim.
Source:
S.L. 1995, ch. 434, § 1.
CHAPTER 47-02 Classification of Ownership
47-02-01. Ownership — Classification.
The ownership of property is:
- Absolute; or
- Qualified.
Source:
Civ. C. 1877, § 171; R.C. 1895, § 3278; R.C. 1899, § 3278; R.C. 1905, § 4714; C.L. 1913, § 5257; R.C. 1943, § 47-0201.
Derivation:
Cal. Civ. C., 678.
47-02-02. Absolute ownership defined.
The ownership of property is absolute when a single person has the absolute dominion over it and may use it or dispose of it according to that person’s pleasure, subject only to general laws.
Source:
Civ. C. 1877, § 172; R.C. 1895, § 3279; R.C. 1899, § 3279; R.C. 1905, § 4715; C.L. 1913, § 5258; R.C. 1943, § 47-0202.
Derivation:
Cal. Civ. C., 679.
Notes to Decisions
Right of Disposition.
Absolute ownership of property implies the right of arbitrary disposition of such property by a capable and uninfluenced person. Johnson v. Johnson, 85 N.W.2d 211, 1957 N.D. LEXIS 144 (N.D. 1957); Hendricks v. Porter, 110 N.W.2d 421, 1961 N.D. LEXIS 89 (N.D. 1961); Holien v. Trydahl, 134 N.W.2d 851, 1965 N.D. LEXIS 164 (N.D. 1965).
47-02-03. Qualified ownership defined.
The ownership of property is qualified:
- When it is shared with one or more persons;
- When the time of enjoyment is deferred or limited; or
- When the use is restricted.
Source:
Civ. C. 1877, § 173; R.C. 1895, § 3280; R.C. 1899, § 3280; R.C. 1905, § 4716; C.L. 1913, § 5259; R.C. 1943, § 47-0203.
Derivation:
Cal. Civ. C., 680.
Law Reviews.
Estates in North Dakota, 30 N.D. L. Rev. 289 (1954).
47-02-04. Sole or concurrent ownership designated.
The ownership of property by a single person is designated as a sole or concurrent ownership.
Source:
Civ. C. 1877, § 174; R.C. 1895, § 3281; R.C. 1899, § 3281; R.C. 1905, § 4717; C.L. 1913, § 5260; R.C. 1943, § 47-0204.
Derivation:
Cal. Civ. C., 681.
47-02-05. Concurrent ownership defined.
The ownership of property by several persons is either:
- Of joint interests;
- Of partnership interests; or
- Of interests in common.
Source:
Civ. C. 1877, § 175; R.C. 1895, § 3282; R.C. 1899, § 3282; R.C. 1905, § 4718; C.L. 1913, § 5261; R.C. 1943, § 47-0205.
Derivation:
Cal. Civ. C., 682.
Law Reviews.
Article: In Re Tenancy By The Entirety - Married Couples, Common Law Marriages, And Same-Sex Partners: Orth v. Orth, see 85 N.D. L. Rev. 287 (2009).
47-02-06. Joint tenancy interest defined.
A joint interest is one owned by several persons in equal shares by a title created by a single will or transfer, when expressly declared in the will or transfer to be a joint tenancy, or when granted or devised to executors or trustees as joint tenants.
Source:
Civ. C. 1877, § 176; R.C. 1895, § 3283; R.C. 1899, § 3283; R.C. 1905, § 4719; C.L. 1913, § 5262; R.C. 1943, § 47-0206.
Derivation:
Cal. Civ. C., 683.
Cross-References.
Effect of homicide on joint tenancy, see N.D.C.C. § 30.1-10-03.
Notes to Decisions
- Bank Account.
- Divorce.
- Medical Assistance Benefits.
- Possession by One.
- Right of Survivorship.
- Savings Bonds.
Bank Account.
Deposit of money by one party in an account which designates depositor and another as joint owners creates a joint tenancy in the funds contained therein. First Nat'l Bank & Trust Co. v. Green, 66 N.D. 160, 262 N.W. 596, 1935 N.D. LEXIS 182 (N.D. 1935).
Divorce.
Property settlement agreement included in a divorce decree providing for the sale of property held in joint tenancy and a division of the proceeds severs the joint tenancy, and the former husband and wife hold the property as tenants in common until the property is sold. Renz v. Renz, 256 N.W.2d 883, 1977 N.D. LEXIS 166 (N.D. 1977).
Medical Assistance Benefits.
District court erred in ruling that the Department of Human Services was entitled to 100 percent of the net sale proceeds from the sale of a decedent’s home to pay for medical assistance benefits previously received by his deceased spouse because the Department’s recovery from a deceased Medicaid recipient’s joint tenancy property was limited to the deceased recipient’s fractional interest in the property. In re Estate of Krueger, 2019 ND 42, 923 N.W.2d 475, 2019 N.D. LEXIS 44 (N.D. 2019).
Possession by One.
Possession of joint tenancy property by one joint tenant is deemed possession of both, and each has right of enjoyment to extent of his interest. In re Estate of Paulson, 219 N.W.2d 132, 1974 N.D. LEXIS 213 (N.D. 1974).
Right of Survivorship.
A joint tenant who survives does not take the moiety of the other tenant from him or as his successor, but takes it by right under the conveyance or instrument by which the joint tenancy was created. In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
Joint tenancy real property became the property of the widow upon the death of her husband by right of survivorship and not by the will of the deceased husband. In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
Although creditors of decedent might have levied upon decedent’s interest in the real estate during his lifetime, upon his death title passes to the survivor subject only to payment of estate taxes. Schlichenmayer v. Luithle, 221 N.W.2d 77, 1974 N.D. LEXIS 182 (N.D. 1974).
Real property owned by joint tenancy became property of widow on death of her husband by right of survivorship, and provision of will which purported to give widow life estate with remainder to husband’s children was void, since husband had no interest in property which he could devise. Cranston v. Winters, 238 N.W.2d 647, 1976 N.D. LEXIS 192 (N.D. 1976).
Each joint tenant with a right of survivorship holds what amounts to a life estate with a remainder in fee contingent upon survival of the other joint tenant; thus, each joint tenant has a contingent fee estate from the time of the creation of the tenancy and the survivor takes nothing from the estate of the other upon his death; therefore, where husband and wife held all their property jointly and had done so since its acquisition, upon the death of the husband-debtor there was nothing on which a writ of execution could operate, and such writ was properly quashed. Jamestown Terminal Elevator v. Knopp, 246 N.W.2d 612, 1976 N.D. LEXIS 141 (N.D. 1976).
Savings Bonds.
Where series E savings bonds are listed in the name of two persons as coowners, a bond so issued will be paid to either coowner upon request and without the signature of the other. In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
If either coowner of a series E savings bond dies while the bond remains a valid obligation, the surviving coowner is recognized as the sole and absolute owner of the bond and entitled to a payment or reissue as though the bond has been registered in his or her name alone. In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
Collateral References.
Creation of right of survivorship by instrument ineffective to create estate by entireties or joint tenancy, 1 A.L.R.2d 247.
Character of tenancy created by owner’s conveyance to himself and another, or to another alone of an undivided interest, 44 A.L.R.2d 595.
What constitutes a devise or bequest in joint tenancy notwithstanding statute raising a presumption against joint tenancy, 46 A.L.R.2d 523.
Survivorship rights in joint bank account in name of incompetent and another, 62 A.L.R.2d 1091, 1100.
Estate by entireties as affected by statute declaring nature of tenancy under grant or devise to two or more persons, 32 A.L.R.3d 570.
Creation of joint savings account or savings certificate as gift to survivor, 43 A.L.R.3d 971.
Judgment lien or levy of execution on one joint tenant’s share or interest as severing joint tenancy, 51 A.L.R.4th 906.
Law Reviews.
North Dakota Joint Tenancies: Severance by Contract for Deed? 42 N.D. L. Rev. 351 (1966).
47-02-07. Partnership interest defined.
A partnership interest is one owned by several persons in partnership for partnership purposes.
Source:
Civ. C. 1877, § 177; R.C. 1895, § 3284; R.C. 1899, § 3284; R.C. 1905, § 4720; C.L. 1913, § 5263; R.C. 1943, § 47-0207.
Derivation:
Cal. Civ. C., 684.
Cross-References.
Partnerships, see N.D.C.C. tit. 45.
Notes to Decisions
Existence of Partnership Denied.
By themselves, neither joint tenancy, nor marriage, nor cosigning of a note establish a business partnership. Schlichenmayer v. Luithle, 221 N.W.2d 77, 1974 N.D. LEXIS 182 (N.D. 1974).
47-02-08. Interest in common defined.
An interest in common is one owned by several persons not in joint ownership or partnership. Every interest created in favor of several persons in their own right is an interest in common, unless acquired by them in partnership for partnership purposes, or unless declared in its creation to be a joint tenancy.
Source:
Civ. C. 1877, §§ 178, 179; R.C. 1895, §§ 3285, 3286; R.C. 1899, §§ 3285, 3286; R.C. 1905, §§ 4721, 4722; C.L. 1913, §§ 5264, 5265; R.C. 1943, § 47-0208.
Derivation:
Cal. Civ. C., 685, 686.
Notes to Decisions
Contribution Among Cotenants.
Where one cotenant pays more than his share of the expenses of the property, a cotenant who has not paid his share of the expenses and who fails to make contribution to the paying cotenant within a reasonable time may be deemed to have abandoned his interest in the property, and his interest will be forfeited to the paying cotenant; however, when the nonpaying cotenant has not failed to make contribution within a reasonable time, the interest of the paying cotenant is not expanded by virtue of his payment in excess of his share. Eastman v. Nelson, 319 N.W.2d 134, 1982 N.D. LEXIS 274 (N.D. 1982).
Right of Survivorship.
There is no valid reason nor any rule of law that forbids the creation of the right of survivorship in tenants in common. First Nat'l Bank & Trust Co. v. Green, 66 N.D. 160, 262 N.W. 596, 1935 N.D. LEXIS 182 (N.D. 1935).
Collateral References.
Partners, tenancy in common between, after dissolution, as affecting accountability for profits earned subsequently to dissolution, 55 A.L.R.2d 1391, 1417.
Character of tenancy created by owner’s conveyance to himself and another, or to another alone of an undivided interest, 44 A.L.R.2d 595.
47-02-09. Commencement and duration of interests.
In respect to the time of enjoyment an interest in property is:
- Present or future; and
- Perpetual or limited.
Source:
Civ. C. 1877, § 180; R.C. 1895, § 3287; R.C. 1899, § 3287; R.C. 1905, § 4723; C.L. 1913, § 5266; R.C. 1943, § 47-0209.
Derivation:
Cal. Civ. C., 688.
Collateral References.
Grant to one for life, and afterwards, either absolutely or contingently, to grantor’s heirs or next of kin, as leaving reversion or creating remainder, 16 A.L.R.2d 691, 714.
Gift or grant in terms sufficient to carry the whole property absolutely as so operating where followed by a purported limitation over of property not disposed of by the first taker, 17 A.L.R.2d 7.
Right of life tenant with power to anticipate or consume principal to dispose of it by inter vivos gift, 83 A.L.R.3d 135.
Treatment and method of evaluation of future interest in real estate or trust property not realized during marriage, 62 A.L.R.4th 107.
47-02-10. Present interest defined.
A present interest means that the owner is entitled to the immediate possession of the property.
Source:
Civ. C. 1877, § 181; R.C. 1895, § 3288; R.C. 1899, § 3288; R.C. 1905, § 4724; C.L. 1913, § 5267; R.C. 1943, § 47-0210.
Derivation:
Cal. Civ. C., 689.
47-02-11. Future interest defined.
A future interest means that the owner is entitled to the possession of the property only at a future period.
Source:
Civ. C. 1877, § 182; R.C. 1895, § 3289; R.C. 1899, § 3289; R.C. 1905, § 4725; C.L. 1913, § 5268; R.C. 1943, § 47-0211.
Derivation:
Cal. Civ. C., 690.
Notes to Decisions
Vested Remainder.
A person who is vested with title to land through the will of his father, though the land is subject to the life estate of his mother, is the owner of a vested remainder which is real property subject to the lien of a judgment. John Leslie Paper Co. v. Wheeler, 23 N.D. 477, 137 N.W. 412, 1912 N.D. LEXIS 110 (N.D. 1912).
Collateral References.
Treatment and method of evaluation of future interest in real estate or trust property not realized during marriage, 62 A.L.R.4th 107.
47-02-12. Perpetual interest defined.
A perpetual interest has a duration equal to that of the property.
Source:
Civ. C. 1877, § 183; R.C. 1895, § 3290; R.C. 1899, § 3290; R.C. 1905, § 4726; C.L. 1913, § 5269; R.C. 1943, § 47-0212.
Derivation:
Cal. Civ. C., 691.
47-02-13. Limited interest defined.
A limited interest has a duration less than that of the property.
Source:
Civ. C. 1877, § 184; R.C. 1895, § 3291; R.C. 1899, § 3291; R.C. 1905, § 4727; C.L. 1913, § 5270; R.C. 1943, § 47-0213.
Derivation:
Cal. Civ. C., 692.
47-02-14. Determination of time of creation of limitation.
The delivery of the grant, where a limitation, condition, or future interest is created by grant, and the death of the testator, when it is created by will, is to be deemed the time of the creation of the limitation, condition, or interest within the meaning of the laws of this state.
Source:
Civ. C. 1877, § 216; R.C. 1895, § 3323; R.C. 1899, § 3323; R.C. 1905, § 4759; C.L. 1913, § 5302; R.C. 1943, § 47-0214.
Derivation:
Cal. Civ. C., 749.
47-02-15. Future estates — Classification.
A future interest is either vested or contingent. It is vested when there is a person in being who would have a right, defeasible or indefeasible, to the immediate possession of the property upon the ceasing of the intermediate or precedent interest. It is contingent while the person in whom or the event upon which it is limited to take effect remains uncertain.
Source:
Civ. C. 1877, §§ 185 to 187; R.C. 1895, §§ 3292 to 3294; R.C. 1899, §§ 3292 to 3294; R.C. 1905, §§ 4728 to 4730; C.L. 1913, §§ 5271 to 5273; R.C. 1943, § 47-0215.
Derivation:
Cal. Civ. C., 693 to 695.
Notes to Decisions
Vested Remainder.
A person who is vested with title to land through the will of his father, though the land is subject to the life estate of his mother, is the owner of a vested remainder which is real property subject to the lien of a judgment. John Leslie Paper Co. v. Wheeler, 23 N.D. 477, 137 N.W. 412, 1912 N.D. LEXIS 110 (N.D. 1912).
Bankruptcy debtor’s remainder interest in farmland held subject to his mother’s life estate was a vested interest. In re Hankel, 223 B.R. 728, 1998 Bankr. LEXIS 991 (Bankr. D.N.D. 1998).
Collateral References.
“Divide and payover” rule, for purpose of determining vested or contingent character of estate, as affected by postponing enjoyment to let in an intermediate interest, 16 A.L.R.2d 1383.
Equal shares: nature of remainders created by will giving life estate to spouse of testator, with remainder to be divided equally between testator’s heirs and spouse’s heirs, 19 A.L.R.2d 371.
Gift or grant to one upon marriage, if married, payable at marriage, or the like, as vested or contingent, 30 A.L.R.2d 127.
Representation, taking by: provision of will that children, etc., of remainderman who dies before expiration of precedent estate or time fixed for distribution to remainderman, shall take the share to which he would have been entitled, as affecting the character of remainder as vested or contingent, 47 A.L.R.2d 900.
Character of remainder limited generally to life tenant’s children, 57 A.L.R.2d 103.
Character of remainder limited to surviving children of life tenant, 57 A.L.R.2d 197.
Vested or contingent remainder as created by inter vivos trust giving settlor, trustee, or life beneficiary power to exhaust trust fund or otherwise terminate trust, 61 A.L.R.2d 477.
Possibility of issue extinct, doctrine as to, as affecting property rights, 98 A.L.R.2d 1285.
47-02-16. Alternative contingencies.
Two or more future interests may be created to take effect in the alternative so that if the first in order fails to vest, the next in succession shall be substituted for it and take effect accordingly.
Source:
Civ. C. 1877, § 188; R.C. 1895, § 3295; R.C. 1899, § 3295; R.C. 1905, § 4731; C.L. 1913, § 5274; R.C. 1943, § 47-0216.
Derivation:
Cal. Civ. C., 696.
47-02-17. Improbable contingency — Future interest valid.
A future interest is not void merely because of the improbability of the contingency on which it is limited to take effect.
Source:
Civ. C. 1877, § 189; R.C. 1895, § 3296; R.C. 1899, § 3296; R.C. 1905, § 4732; C.L. 1913, § 5275; R.C. 1943, § 47-0217.
Derivation:
Cal. Civ. C., 697.
47-02-18. Future estates pass.
Future interests pass by succession, will, and transfer in the same manner as present interests.
Source:
Civ. C. 1877, § 191; R.C. 1895, § 3298; R.C. 1899, § 3298; R.C. 1905, § 4734; C.L. 1913, § 5277; R.C. 1943, § 47-0218.
Derivation:
Cal. Civ. C., 699.
47-02-19. Posthumous heir.
When a future interest is limited to successors, heirs, issue, or children, posthumous children are entitled to take in the same manner as if living at the death of their parent.
Source:
Civ. C. 1877, § 190; R.C. 1895, § 3297; R.C. 1899, § 3297; R.C. 1905, § 4733; C.L. 1913, § 5276; R.C. 1943, § 47-0219.
Derivation:
Cal. Civ. C., 698.
Cross-References.
Contingent interest defeated by birth of posthumous child, see N.D.C.C. § 47-02-29.
Collateral References.
Legal status of posthumously conceived child of decedent, 17 A.L.R.6th 593.
47-02-20. Mere possibility not an interest.
A mere possibility, such as the expectancy of an heir apparent, is not to be deemed an interest of any kind.
Source:
Civ. C. 1877, § 192; R.C. 1895, § 3299; R.C. 1899, § 3299; R.C. 1905, § 4735; C.L. 1913, § 5278; R.C. 1943, § 47-0220.
Derivation:
Cal. Civ. C., 700.
Notes to Decisions
Beneficiaries of Discretionary Trust.
Where the principal and income of a trust are payable to beneficiaries as a class, only in the uncontrolled discretion of the trustee, the beneficiaries do not have interests in the trust property, but have merely inalienable expectancies with no certainty of ultimate enjoyment. Brownell v. Leutz, 149 F. Supp. 98, 1957 U.S. Dist. LEXIS 3830 (D.N.D. 1957).
Nontransferability.
Under the real property law of both California and North Dakota, a mere possibility, such as an expectancy of an heir apparent, is not to be deemed an interest of any kind, and it cannot be transferred. Wacker Oil v. LoneTree Energy, 459 N.W.2d 381, 1990 N.D. LEXIS 163 (N.D. 1990).
47-02-21. Future interests — Limitation.
No future interest in property is recognized by the law, except such as is defined in this title.
Source:
Civ. C. 1877, § 195; R.C. 1895, § 3302; R.C. 1899, § 3302; R.C. 1905, § 4738; C.L. 1913, § 5281; R.C. 1943, § 47-0221.
Derivation:
Cal. Civ. C., 703.
47-02-22. Conditions of ownership — Definition.
The time when the enjoyment of property is to begin or end may be determined by computation or made to depend on events. In the latter case, the enjoyment is said to be upon condition.
Source:
Civ. C. 1877, § 196; R.C. 1895, § 3303; R.C. 1899, § 3303; R.C. 1905, § 4739; C.L. 1913, § 5282; R.C. 1943, § 47-0222.
Derivation:
Cal. Civ. C., 707.
Collateral References.
Substitution by will: time as of which members of class described as remainderman’s or life tenant’s “heirs”, “next of kin”, “descendants”, “issue”, “family”, or the like, substituted by will to take in place of deceased remainderman, are to be ascertained, 33 A.L.R.2d 242.
Inter vivos trust: time of ascertaining persons to take, under deed or inter vivos trust, where designated as the “heirs”, “next of kin”, “children”, “relations”, etc., of life tenant or remainderman, 65 A.L.R.2d 1408.
Condition of death: time to which condition of remainderman’s death refers, under gift or grant to one for life or term of years and then to remainderman, but if remainderman dies without issue, then over to another, 26 A.L.R.3d 407.
Adopted child as within class named in deed or inter vivos trust instrument, 37 A.L.R.5th 237.
47-02-23. Conditions — Classification.
Conditions are precedent or subsequent. The former fix the beginning, the latter the ending of the right.
Source:
Civ. C. 1877, § 197; R.C. 1895, § 3304; R.C. 1899, § 3304; R.C. 1905, § 4740; C.L. 1913, § 5283; R.C. 1943, § 47-0223.
Derivation:
Cal. Civ. C., 708.
Collateral References.
Ademption of specific legacy or devise to legatee, construction and effect of general legacy conditional upon, 2 A.L.R.2d 819.
Heirs: nature of estates or interests created by grant or devise to one and heirs if donee should have any heirs, 16 A.L.R.2d 670, 678.
Residence: validity of provision in will regulating or controlling beneficiary’s residence, 35 A.L.R.2d 387.
Family name: condition precedent or subsequent as created by provision in will conditioning gift on beneficiary’s assumption or retention of family name, 38 A.L.R.2d 1343, 1345.
Home: language providing premises as a home, or giving or granting same for such use, as creating life estate defeasible by failure to use premises as home, 45 A.L.R.2d 699.
Marriage to one of a particular religious faith, validity of provisions of deed prohibiting, penalizing, or requiring, 50 A.L.R.2d 740.
Effect of transfer of possibility of reverter or right of reentry, following conveyance of determinable fee or fee subject to condition subsequent, 53 A.L.R.2d 224.
Divorce or separation, validity of condition of gift depending on, 14 A.L.R.3d 1219.
Services: bequest or devise referring to services to be rendered by donee to testator during latter’s lifetime as absolute or conditional gift, 22 A.L.R.3d 771.
Support or services: testamentary devise or bequest conditioned upon beneficiary’s supporting or rendering services to named person as providing for condition subsequent or precedent, 25 A.L.R.3d 762.
Marriage: validity and construction of testamentary gift conditioned upon beneficiary’s remaining married, 28 A.L.R.3d 1325.
Effect of invalidity of provision conditioning testamentary gift upon divorce of beneficiary, on alternative provision conditioning gift upon spouse’s death, 74 A.L.R.3d 1095.
Effect of impossibility of performance of condition precedent to testamentary gift, 40 A.L.R.4th 193.
47-02-24. Illegal conditions void.
If a condition precedent requires the performance of an act wrong in itself, the instrument containing it is so far void, and the right cannot exist. If it requires the performance of an act not wrong of itself, but otherwise unlawful, the instrument takes effect and the condition is void.
Source:
Civ. C. 1877, § 198; R.C. 1895, § 3305; R.C. 1899, § 3305; R.C. 1905, § 4741; C.L. 1913, § 5284; R.C. 1943, § 47-0224.
Derivation:
Cal. Civ. C., 709.
Collateral References.
Effect of invalidity of provision conditioning testamentary gift upon divorce of beneficiary, or alternative provision conditioning gift upon spouse’s death, 74 A.L.R.3d 1095.
47-02-25. Restraints upon marriage void — Use until marriage.
Conditions imposing restraints upon marriage, except upon the marriage of a minor, or of the widow of the person by whom the condition is imposed, are void. This does not affect limitations when the intent was not to forbid marriage but only to give the use until marriage.
Source:
Civ. C. 1877, § 199; R.C. 1895, § 3306; R.C. 1899, § 3306; R.C. 1905, § 4742; C.L. 1913, § 5285; R.C. 1943, § 47-0225.
Derivation:
Cal. Civ. C., 710.
Notes to Decisions
Divorce Settlements.
Amendment of divorce judgment to require former wife, who had been awarded possession of the marital home, to pay former husband his share in the equity of the marital home upon the remarriage of the former wife, did not violate this section’s prohibition of restraints on marriage. Suko v. Suko, 304 N.W.2d 690, 1981 N.D. LEXIS 271 (N.D. 1981).
Collateral References.
Marriage to one of a particular religious faith, validity of provisions of deed prohibiting, penalizing or requiring, 50 A.L.R.2d 740.
Divorce or separation, validity of condition of gift depending on, 14 A.L.R.3d 1219.
Validity and construction of testamentary gift conditioned upon beneficiary’s remaining married, 28 A.L.R.3d 1325.
Effect of invalidity of provision conditioning testamentary gift upon divorce of beneficiary, on alternative provision conditioning gift upon spouse’s death, 74 A.L.R.3d 1095.
47-02-26. Restraints on alienation — When void.
Conditions restraining alienation, when repugnant to the interest created, are void.
Source:
Civ. C. 1877, § 200; R.C. 1895, § 3307; R.C. 1899, § 3307; R.C. 1905, § 4743; C.L. 1913, § 5286; R.C. 1943, § 47-0226.
Derivation:
Cal. Civ. C., 711.
Notes to Decisions
Due-on-Sale Clause in Mortgage.
Federal regulations permit federally chartered savings and loan associations to enforce due-on-sale clauses in real estate mortgages; such clauses do not violate this section. Northwestern Fed. Sav. & Loan Ass'n v. Ternes, 315 N.W.2d 296, 1982 N.D. LEXIS 238 (N.D. 1982).
Where Fee Simple Is Devised.
Where an estate in fee simple is given by will, an attempted testamentary restraint on the devisee’s power of alienation is void as repugnant to the nature of the estate given. Holien v. Trydahl, 134 N.W.2d 851, 1965 N.D. LEXIS 164 (N.D. 1965).
Collateral References.
Class: validity of provision of will or conveyance limiting alienation to certain individuals or those of a limited class, 36 A.L.R.2d 1437.
Validity of restraint on alienation, of an estate in fee, ending not later than expiration of a life or lives in being, 42 A.L.R.2d 1243.
Charities: validity and effect of provision or condition against alienation in gift for charitable trust or to charitable corporation, 100 A.L.R.2d 1208.
Preemptive rights to realty as violation of rule against perpetuities or rule concerning restraints on alienation, 40 A.L.R.3d 920.
Options: independent option to purchase real estate as violating rule against perpetuities or restraints on alienation, 66 A.L.R.3d 1294.
47-02-27. Suspension of power of alienation — Rule against perpetuities. [Repealed]
Repealed by S.L. 1991, ch. 484, § 6.
Note.
For present provisions, see Uniform Statutory Rule Against Perpetuities, N.D.C.C. §§ 47-02-27.1 to 47-02-27.5.
47-02-27.1. Statutory rule against perpetuities — Invalidity of certain contingent property interests, general powers of appointment, special powers of appointment, and general testamentary powers of appointment.
-
A contingent property interest is invalid unless:
- When the interest is created, it is certain to vest or terminate no later than twenty-one years after the death of an individual then alive; or
- The interest either vests or terminates within ninety years after its creation.
-
A general power of appointment not presently exercisable because of a condition precedent is invalid unless:
- When the power is created, the condition precedent is certain to be satisfied or to become impossible to satisfy no later than twenty-one years after the death of an individual then alive; or
- The condition precedent either is satisfied or becomes impossible to satisfy within ninety years after its creation.
-
A special power of appointment or a general testamentary power of appointment is invalid unless:
- When the power is created, it is certain to be irrevocably exercised or otherwise to terminate no later than twenty-one years after the death of an individual then alive; or
- The power is irrevocably exercised or otherwise terminates within ninety years after its creation.
- In determining whether a contingent property interest or a power of appointment is valid under subdivision a of subsection 1, subdivision a of subsection 2, or subdivision a of subsection 3, the possibility that a child will be born to an individual after the individual’s death is disregarded.
- If, in measuring a period from the creation of a trust or other property arrangement, language in a governing instrument seeks to disallow the vesting or termination of any interest or trust beyond, seeks to postpone the vesting or termination of any interest or trust until, or seeks to operate in effect in any similar fashion upon, the later of the expiration of a period of time not exceeding twenty-one years after the death of the survivor of specified lives in being at the creation of the trust or other property arrangement or the expiration of a period of time that exceeds or might exceed twenty-one years after the death of the survivor of lives in being at the creation of the trust or other property arrangement, that language is inoperative to the extent it produces a period of time that exceeds twenty-one years after the death of the survivor of the specified lives.
Source:
S.L. 1991, ch. 484, § 1; 1993, ch. 449, § 1.
Derivation:
Cal. Civ. C., 715.
Note.
This chapter is an adoption of the Uniform Statutory Rule Against Perpetuities.
DECISIONS UNDER PRIOR LAW
Alternative Constructions of Will.
If one construction of a will will cause it to violate the rule against perpetuities, and another construction will make it comply with this rule, the latter will be preferred. In re Gray's Estate, 27 N.D. 417, 146 N.W. 722, 1914 N.D. LEXIS 55 (N.D. 1914).
Business Trusts.
Business trusts which suspend the power of alienation beyond the statutory limit are void under this section. Johnson v. Fitzmaurice, 127 N.W.2d 497, 1964 N.D. LEXIS 96 (N.D. 1964).
Common Law Rule.
The power of alienation prior to the enactment of S.L. 1933, ch. 203 could not be suspended for a period longer than during the continuance of the lives of persons in being at the creation of the limitation. Penfield v. Tower, 1 N.D. 216, 46 N.W. 413, 1890 N.D. LEXIS 27 (N.D. 1890).
Charitable Trusts.
Charitable trusts are not within the rule against perpetuities nor are they affected by or within the scope of statutory or constitutional provisions against perpetuities in general. Hagen v. Sacrison, 19 N.D. 160, 123 N.W. 518, 1909 N.D. LEXIS 95 (N.D. 1909).
Law Governing.
Chapter 203 of S.L. 1933 and chapter 274 of S.L. 1953, amending this section, did not apply to a trust created before the amendments were passed. Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
Oil and Gas Leases.
Interests in oil and gas leases are interests in real property, and may be subject to the rule against perpetuities in proper cases. But the usual lease for a term of years and so long thereafter as oil and gas is produced is seemingly impregnable under the rule. Nevertheless, there are some interests related to oil and gas leasing where sufficiently definitive decisional law has not accumulated to “settle” the subject. “Top leasing” is apparently one of them. Nantt v. Puckett Energy Co., 382 N.W.2d 655, 1986 N.D. LEXIS 263 (N.D. 1986).
Since there was no extension of bottom leases by production, no violation of the rule against perpetuities by indefinite suspension of defendant’s possession of oil and gas rights under its top leases occurred. Nantt v. Puckett Energy Co., 382 N.W.2d 655, 1986 N.D. LEXIS 263 (N.D. 1986).
Partially Valid Trust.
When a testator’s primary and dominant purpose is completely expressed in the trust provisions of the will, independent of any provisions that are void as against the statute on perpetuities, such portion expressing the primary intent of the testator will be held valid so as to carry out the testator’s intention as far as possible. Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
Period of Gestation.
The law allows the power of alienation to be suspended beyond the statutory period during the time of gestation in cases of an infant en ventre sa mere. Penfield v. Tower, 1 N.D. 216, 46 N.W. 413, 1890 N.D. LEXIS 27 (N.D. 1890).
Power to Change Property.
The power to change the trust property from real to personal estate will not save the trust from the condemnation of the statute. Penfield v. Tower, 1 N.D. 216, 46 N.W. 413, 1890 N.D. LEXIS 27 (N.D. 1890); Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
Power to Sell or Exchange Property.
Power to exchange or sell and reinvest the property of the trust, keeping the trust intact, does not remove restraints on alienability. Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
Rule Against Perpetuities.
Strictly speaking, in this state there is no statute against perpetuities. The common-law rule against perpetuities is not in force in this state as statutes dealing with restraints on alienation are found in this chapter. Anderson v. Blixt, 72 N.W.2d 799, 1955 N.D. LEXIS 145 (N.D. 1955).
Suspension of Power of Alienation.
An active or express trust suspends the absolute power of alienation during its continuance, and such a trust is therefore void when it is to continue for longer than lives in being at the death of the testator. Penfield v. Tower, 1 N.D. 216, 46 N.W. 413, 1890 N.D. LEXIS 27 (N.D. 1890); Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
Every estate, present or future, which suspends the power of alienation is void. Penfield v. Tower, 1 N.D. 216, 46 N.W. 413, 1890 N.D. LEXIS 27 (N.D. 1890).
If there is any possibility that the suspension may continue beyond the statutory limit, the suspension is void. Carlson v. Tioga Holding Co., 72 N.W.2d 236, 1955 N.D. LEXIS 139 (N.D. 1955).
A direction in a will giving the executor discretion as to when he shall sell the land and distribute the proceeds is valid, since the power of alienation is not suspended, though it may not be exercised during the period. Hagen v. Sacrison, 19 N.D. 160, 123 N.W. 518, 1909 N.D. LEXIS 95 (N.D. 1909).
A devise over, in case the devisee should refuse to accept the devise if not made subject to a condition precedent, does not suspend the power of alienation. In re Gray's Estate, 27 N.D. 417, 146 N.W. 722, 1914 N.D. LEXIS 55 (N.D. 1914).
If a testamentary trust suspends the power of the alienation of property beyond the time permitted by the statute against perpetuities in force at the time of the creation of the trust, such trust is invalid. Hull v. Rolfsrud, 65 N.W.2d 94, 1954 N.D. LEXIS 80 (N.D. 1954).
The test as to whether the absolute power of alienation has been suspended beyond the statutory limit is whether there is any possibility that the suspension may continue beyond it. If such possibility exists the suspension is void. Carlson v. Tioga Holding Co., 72 N.W.2d 236, 1955 N.D. LEXIS 139 (N.D. 1955).
The absolute power of alienation is suspended when there are no persons in being by whom an absolute interest in possession can be conveyed. Carlson v. Tioga Holding Co., 72 N.W.2d 236, 1955 N.D. LEXIS 139 (N.D. 1955).
A trust instrument which requires the trustee to hold real property intact for the duration of the trust and to distribute the rents and profits thereof to the beneficiaries of the trust suspends the absolute power of alienation during the continuance of the trust. Carlson v. Tioga Holding Co., 72 N.W.2d 236, 1955 N.D. LEXIS 139 (N.D. 1955).
A trust which suspends the absolute power of alienation for ten years and for as long thereafter as oil and gas may be produced upon the trust property suspends the power of alienation beyond the statutory limit. Carlson v. Tioga Holding Co., 72 N.W.2d 236, 1955 N.D. LEXIS 139 (N.D. 1955).
Trust to Provide Income for Beneficiaries.
A trust created by will, which was to run for fifteen years, with an optional provision for an additional five years, and which did not become effective until twelve years after the testator’s death, did not violate rule against perpetuities where all the beneficiaries of the trust were in being at the time of the testator’s death. In such case, the lives of the beneficiaries provided the required limitation on suspension of alienability. In re Montgomery, 144 N.W.2d 382, 1966 N.D. LEXIS 105 (N.D. 1966).
Validity Favored.
In case of ambiguity, the construction resulting in validity under our statutory rule against perpetuities is preferred. Nantt v. Puckett Energy Co., 382 N.W.2d 655, 1986 N.D. LEXIS 263 (N.D. 1986).
Collateral References.
Revocation or termination of trust, or withdrawal of funds or invasion of corpus thereof, settlor’s reservation of right of, as affecting operation of rule against perpetuities, 7 A.L.R.2d 1089.
Historical material: application of rule against perpetuities to trust for dissemination or preservation of material of historical or other educational interest or value, 12 A.L.R.2d 849.
Validity, under rule against perpetuities, of gift in remainder to creator’s great-grandchildren, following successive life estates to children and grandchildren, 18 A.L.R.2d 671.
Option created by will to purchase real estate as affected by rule against perpetuities, 44 A.L.R.2d 1214, 1228.
Application of rule against perpetuities to limitation over on discontinuance of use for which premises are given or granted, or the commencement of a prohibited use, 45 A.L.R.2d 1154.
Postponement of enjoyment of interest as affecting validity of perpetual nonparticipating royalty interest in oil and gas under rule against perpetuities, 46 A.L.R.2d 1268.
Cemeteries: rule against perpetuities as affecting validity of trust for maintenance or care of private cemetery, burial lot, tomb or monument, 47 A.L.R.2d 596, 622.
Separability for purposes of rule against perpetuities of gifts to several persons by one description, 56 A.L.R.2d 450.
Lease for term of years, or contract therefor, as violating rule against perpetuities, 66 A.L.R.2d 733.
Charitable trust: rule against perpetuities as affecting validity, as a charitable trust, of gift to church, church society, or trustees or officers thereof, without declaration or restriction as to its use or purpose, 81 A.L.R.2d 819, 827.
Equitable approximation doctrine, applicability to cut down to a permissible time period the time of a testamentary gift that violates rule against perpetuities, 95 A.L.R.2d 807.
Alternative contingencies, rule against perpetuities where estate is limited on, one within and one beyond the period allowed by the rule, 98 A.L.R.2d 807.
Possibility of issue extinct, doctrine as to, as affecting rule against perpetuities, 98 A.L.R.2d 1285.
Doctrine that gift which might be void under rule against perpetuities will be given effect where contingency actually occurs within period of rule, 20 A.L.R.3d 1094.
Options: independent option to purchase real estate as violating rule against perpetuities or restraints on alienation, 66 A.L.R.3d 1294.
Validity, as for a charitable purpose, of trust for publication or distribution of particular books or writings, 34 A.L.R.4th 419.
Law Reviews.
The Growing Uncertainty of Real Estate Titles, 65 N.D. L. Rev. 1 (1989).
Comparative Legislation.
Jurisdictions which have enacted the Uniform Statutory Rule Against Perpetuities include:
Cal. Probate Code, §§ 21200 to 21231.
Colo. Rev. Stat., §§ 15-11-1101 to 15-11-1107.
Conn. §§ 45a-490 to 45a-496.
Fla. Stat. § 689.225.
Ga. Code §§ 44-6-200 to 44-6-206.
Hawaii Rev. Stat., §§ 525-1 to 525-6.
Ind. Code, §§ 32-17-8-1 to 32-17-8-6.
Kan. Stat. Ann., §§ 59-3401 to 59-3408.
Mass. Gen. Laws Ann. ch. 190B, §§ 2-901 to 2-906.
Mich. Comp. Laws §§ 554.71 to 554.78.
Minn. Stat. §§ 501A.01 to 501A.07.
Mont. Code Ann. §§ 72-2-1001 to 72-2-1017.
Neb. Rev. Stat. §§ 76-2001 to 76-2008.
Nev. Rev. Stat. §§ 111.103 to 111.1039.
N.M. Stat. Ann., §§ 45-2-901 to 45-2-906.
Or. Rev. Stat. §§ 105.950 to 105.975.
S.C. Code Ann. §§ 27-6-10 to 27-6-80.
W.V. Code, §§ 36-1A-1 to 36-1A-8.
47-02-27.2. When contingent property interest or power of appointment created.
- Except as provided in subsections 2 and 3 of this section and in subsection 1 of section 47-02-27.5, the time of creation of a contingent property interest or a power of appointment is determined under general principles of property law.
- For purposes of sections 47-02-27.1 through 47-02-27.5, if there is a person who alone can exercise a power created by a governing instrument to become an unqualified beneficial owner of a contingent property interest or a property interest subject to a power of appointment described in subsection 2 or 3 of section 47-02-27.1, the contingent property interest or power of appointment is created when the power to become the unqualified beneficial owner terminates.
- For purposes of sections 47-02-27.1 through 47-02-27.5, a contingent property interest or a power of appointment arising from a transfer of property to a previously funded trust or other existing property arrangement is created when the contingent property interest or power of appointment in the original contribution was created.
Source:
S.L. 1991, ch. 484, § 2.
47-02-27.3. Reformation.
Upon the petition of an interested person, a court shall reform a disposition in the manner that most closely approximates the transferor’s manifested plan of distribution and is within the ninety years allowed under subdivision b of subsection 1 of section 47-02-27.1, subdivision b of subsection 2 of section 47-02-27.1, and subdivision b of subsection 3 of section 47-02-27.1, if:
- A contingent property interest or a power of appointment becomes invalid under section 47-02-27.1;
- A class gift is not but might become invalid under section 47-02-27.1 and the time has arrived when the share of any class member is to take effect in possession or enjoyment; or
- A contingent property interest that is not validated by subdivision a of subsection 1 of section 47-02-27.1 can vest but not within ninety years after its creation.
Source:
S.L. 1991, ch. 484, § 3.
47-02-27.4. Exclusions from statutory rule against perpetuities.
Section 47-02-27.1 does not apply to:
- A contingent property interest or a power of appointment arising out of a nondonative transfer, except a contingent property interest or a power of appointment arising out of a premarital or postmarital agreement, a separation or divorce settlement, a spouse’s election, a similar arrangement arising out of a prospective, existing, or previous marital relationship between the parties, a contract to make or not to revoke a will or trust, a contract to exercise or not to exercise a power of appointment, a transfer in satisfaction of a duty of support, or a reciprocal transfer.
- A fiduciary’s power relating to the administration or management of assets, including the power of a fiduciary to sell, lease, or mortgage property, and the power of a fiduciary to determine principal and income.
- A power to appoint a fiduciary.
- A discretionary power of a trustee to distribute principal before termination of a trust to a beneficiary having an indefeasibly vested interest in the income and principal.
- A contingent property interest held by a charity, government, or governmental agency or subdivision, if the contingent property interest is preceded by an interest held by another charity, government, or governmental agency or subdivision.
- A property interest, power of appointment, or arrangement that was not subject to the common-law rule against perpetuities or excluded by another statute of this state.
- Except to the extent otherwise provided in the governing instrument of a business trust, a business trust has perpetual existence, and a business trust may not be terminated or revoked by a beneficial owner or other person except in accordance with the terms of its governing instrument. A business trust, whether domestic or foreign, except for a real estate investment trust, may not own any interest in real property within this state. As used in this subsection “real estate investment trust” means a trust qualifying as a real estate investment trust under section 856 et seq., of the United States Internal Revenue Code of 1986 [26 U.S.C. 856 et seq.], or a trust qualifying as a real estate mortgage investment conduit under section 860 D of the United States Internal Revenue Code of 1986 [26 U.S.C. 860 D].
Source:
S.L. 1991, ch. 484, § 4; 2017, ch. 14, § 24, eff July 1, 2017; 2017, ch. 416, § 1, eff August 1, 2017.
Note.
Section 47-02-27.4 was amended 2 times by the 2017 Legislative Assembly. Pursuant to Section 1-02-09.1, the section is printed above to harmonize and give effect to the changes made in Section 24 of Chapter 14, Session Laws 2017, House Bill 2015; and Section 1 of Chapter 416, Session Laws 2017, House Bill 1228.
47-02-27.5. Prospective application.
- Except as extended by subsection 2, sections 47-02-27.1 through 47-02-27.5 apply to a contingent property interest or a power of appointment that is created on or after July 1, 1991. For purposes of this section, a contingent property interest or a power of appointment created by the exercise of a power of appointment is created when the power is irrevocably exercised or when a revocable exercise becomes irrevocable.
- If a contingent property interest or a power of appointment was created before July 1, 1991, and is determined in a judicial proceeding, commenced on or after July 1, 1991, to violate this state’s rule against perpetuities as that rule existed before July 1, 1991, a court upon the petition of an interested person may reform the disposition in the manner that most closely approximates the transferor’s manifested plan of distribution and is within the limits of the rule against perpetuities applicable when the contingent property interest or power of appointment was created.
Source:
S.L. 1991, ch. 484, § 5; 1997, ch. 51, § 36.
47-02-28. Termination of future interest — Provision by creator.
A future interest may be defeated in any manner, or by any act or means, which the party creating such interest provided for or authorized in the creation thereof, nor is a future interest thus liable to be defeated to be adjudged void in its creation on that ground.
Source:
Civ. C. 1877, § 212; R.C. 1895, § 3319; R.C. 1899, § 3319; R.C. 1905, § 4755; C.L. 1913, § 5298; R.C. 1943, § 47-0228.
Derivation:
Cal. Civ. C., 740.
Notes to Decisions
Specific Devise with Power.
A future executory interest in real estate may be devised which will not be rendered void by a specific devise to the first taker of such realty with a power of disposition. Priewe v. Priewe, 43 N.D. 509, 175 N.W. 732, 1919 N.D. LEXIS 68 (N.D. 1919).
47-02-29. Future interest dependent on death without successors is defeated by birth of posthumous child.
A future interest depending on the contingency of the death of any person without successors, heirs, issue, or children is defeated by the birth of a posthumous child of such person capable of taking by succession.
Source:
Civ. C. 1877, § 211; R.C. 1895, § 3318; R.C. 1899, § 3318; R.C. 1905, § 4754; C.L. 1913, § 5297; R.C. 1943, § 47-0229.
Derivation:
Cal. Civ. C., 739.
Cross-References.
Posthumous children entitled to take limited future interest as if living at death of parent, see N.D.C.C. § 47-02-19.
Collateral References.
Legal status of posthumously conceived child of decedent, 17 A.L.R.6th 593.
47-02-30. Future interest — Effect of change of intermediate interest.
No future interest can be defeated or barred by any alienation or other act of the owner of the intermediate or precedent interest, nor by any destruction of such precedent interest by forfeiture, surrender, merger, or otherwise, except as provided by section 47-02-32, or when a forfeiture is imposed by statute as a penalty for the violation thereof.
Source:
Civ. C. 1877, § 213; R.C. 1895, § 3320; R.C. 1899, § 3320; R.C. 1905, § 4756; C.L. 1913, § 5299; R.C. 1943, § 47-0230.
Derivation:
Cal. Civ. C., 741.
Notes to Decisions
Invalid Conveyance.
Son was not entitled to inherit mineral acres or an option to purchase real property from the son’s stepfather’s estate because the son’s mother’s attempt to convey the property to the stepson upon the mother’s death was invalid, as the mother only had a life estate in the property and, thus, nothing to convey upon the mother’s death. First Nat'l Bank & Trust Co. of Williston v. Solberg (In re Estate of Nelson), 2018 ND 118, 910 N.W.2d 856, 2018 N.D. LEXIS 119 (N.D. 2018), cert. denied, — U.S. —, 139 S. Ct. 2667, 204 L. Ed. 2d 1073, 2019 U.S. LEXIS 3738 (U.S. 2019).
47-02-31. Future interest restraining alienation — When void. [Repealed]
Repealed by S.L. 1991, ch. 484, § 6.
Note.
For present provisions, see Uniform Statutory Rule Against Perpetuities, §§ 47-02-27.1 to 47-02-27.5.
47-02-32. Future interest — Effect of determination of precedent interest — Contingent remainders not artificially destructible.
No future interest, valid in its creation, is defeated by the determination of the precedent interest before the happening of the contingency on which the future interest is limited to take effect, but should such contingency afterwards happen, the future interest takes effect in the same manner and to the same extent as if the precedent interest had continued to the same period.
Source:
Civ. C. 1877, § 214; R.C. 1895, § 3321; R.C. 1899, § 3321; R.C. 1905, § 4757; C.L. 1913, § 5300; R.C. 1943, § 47-0232.
Derivation:
Cal. Civ. C., 742.
47-02-33. Rights of owner of life estate.
The owner of a life estate may use the land in the same manner as the owner of a fee simple, except that the owner of a life estate must do no act to the injury of the inheritance.
Source:
Civ. C. 1877, § 256; R.C. 1895, § 3363; R.C. 1899, § 3363; R.C. 1905, § 4799; C.L. 1913, § 5342; R.C. 1943, § 47-0233.
Derivation:
Cal. Civ. C., 818.
Notes to Decisions
In General.
The owner of a life estate must do no act to injure the inheritance. Roach v. McKee, 66 N.D. 304, 265 N.W. 264, 1936 N.D. LEXIS 171 (N.D. 1936).
Because the deed creating the life estate in the life tenant only reserved the minerals in the property and did not reserve the surface, and the deed did not contain any language excluding application of the doctrine, it was clear that the open mines doctrine applied. Thus, the life tenant was entitled to the proceeds from the oil and gas production, including the royalties and bonus payments, and she was not required to hold the proceeds in trust for the remainderman. The district court erred in granting summary judgment in favor of the remainderman. Reese v. Reese-Young, 2020 ND 35, 938 N.W.2d 405, 2020 N.D. LEXIS 34 (N.D. 2020).
Open mines doctrine was a common law doctrine adopted as the law in North Dakota as it did not conflict with any statutory law, including the duties and relationship between life tenants and remaindermen in N.D.C.C. §§ 47-02-33 and 47-04-22. Reese v. Reese-Young, 2020 ND 35, 938 N.W.2d 405, 2020 N.D. LEXIS 34 (N.D. 2020).
Profits.
In a dispute between siblings over a trust, the trial court correctly determined that the trust instrument was not ambiguous as to the creation of life estate interests for defendant trustees; in accordance with N.D.C.C. § 47-02-33, defendants were entitled to profits from the trust lands during their lifetimes. Sabo v. Keidel, 2008 ND 41, 745 N.W.2d 661, 2008 N.D. LEXIS 41 (N.D. 2008).
Collateral References.
Mineral lease, rights of tenant for life and remaindermen inter se in royalties or rents under, 18 A.L.R.2d 98.
Life tenant’s right of action for injury or damage to property, 49 A.L.R.2d 1117.
Timber rights of life tenant, 51 A.L.R.2d 1374.
Eminent domain, distribution as between life tenant and remainderman of proceeds of, 91 A.L.R.2d 963.
Improvement assessments, duty as between life tenant and remainderman as respects payment of, 10 A.L.R.3d 1309.
Forfeiture of life estate for waste, 16 A.L.R.3d 1344.
Crops: rights in respect of crops as between estate of life tenant and remainderman, 47 A.L.R.3d 784.
Waste: right of contingent remainderman to maintain action for damages for waste, 56 A.L.R.3d 677.
Right of life tenant with power to anticipate or consume principal to dispose of it by inter vivos gift, 83 A.L.R.3d 135.
Duty as between life tenant and remainderman with respect to cost of improvements or repairs made under compulsion of governmental authority, 43 A.L.R.4th 1012.
47-02-34. Life estate — Obligation to maintain property — Waste — Taxes — Other charges and assessments.
The owner of a life estate must keep the buildings and fences in repair from ordinary waste and must pay the taxes and other annual charges and a just proportion of extraordinary assessments benefiting the whole inheritance.
Source:
Civ. C. 1877, § 271; R.C. 1895, § 3378; R.C. 1899, § 3378; R.C. 1905, § 4814; C.L. 1913, § 5357; R.C. 1943, § 47-0234.
Derivation:
Cal. Civ. C., 840.
Collateral References.
Duty as between life tenant and remainderman with respect to cost of improvements or repairs made under compulsion of governmental authority, 43 A.L.R.4th 1012.
CHAPTER 47-03 Accumulations of Property
47-03-01. Income defined.
The income of property, as the term is used in this title, includes the rents and profits of real property, the interest of money, dividends upon stock, and other produce of personal property.
Source:
Civ. C. 1877, § 215; R.C. 1895, § 3322; R.C. 1899, § 3322; R.C. 1905, § 4858; C.L. 1913, § 5301; R.C. 1943, § 47-0301.
Derivation:
Cal. Civ. C., 748.
47-03-02. Income from future interests — Dispositions.
Dispositions of the income of property to accrue and to be received at any time subsequent to the execution of the instrument creating such dispositions are governed by the rules prescribed in this title in relation to future interests.
Source:
Civ. C. 1877, § 204; R.C. 1895, § 3311; R.C. 1899, § 3311; R.C. 1905, § 4747; C.L. 1913, § 5290; R.C. 1943, § 47-0302.
Derivation:
Cal. Civ. C., 722.
47-03-03. Undisposed income — Persons entitled to future interest.
When, in consequence of a valid limitation of a future interest, there is a suspension of the power of alienation or of the ownership, during the continuation of which the income is undisposed of, and no valid direction for its accumulation is given, such income belongs to the persons presumptively entitled to the next eventual interest.
Source:
Civ. C. 1877, § 210; R.C. 1895, § 3317; R.C. 1899, § 3317; R.C. 1905, § 4753; C.L. 1913, § 5296; R.C. 1943, § 47-0303.
Derivation:
Cal. Civ. C., 733.
Collateral References.
Distribution of income released by declaration of invalidity of express direction for accumulation, 17 A.L.R.3d 231.
47-03-04. Accumulation of income — How directed. [Repealed]
Repealed by S.L. 1959, ch. 330, § 1.
47-03-05. Accumulation beyond minority of beneficiaries — Direction void. [Repealed]
Repealed by S.L. 1959, ch. 330, § 1.
47-03-06. Allowance to minor from accumulations.
When a minor for whose benefit an accumulation has been directed is destitute of other sufficient means of support and education, the district court, upon application, may direct a suitable sum to be applied thereto out of the fund.
Source:
Civ. C. 1877, § 208; R.C. 1895, § 3315; R.C. 1899, § 3315; R.C. 1905, § 4751; C.L. 1913, § 5294; R.C. 1943, § 47-0306; S.L. 1991, ch. 326, § 172.
Derivation:
Cal. Civ. C., 726.
47-03-07. Illegal accumulation. [Repealed]
Repealed by S.L. 1961, ch. 297, § 1.
CHAPTER 47-04 Estates in Real Property
47-04-01. Jurisdiction — State laws.
Real property within this state is governed by the law of this state.
Source:
Civ. C. 1877, § 217; R.C. 1895, § 3324; R.C. 1899, § 3324; R.C. 1905, § 4760; C.L. 1913, § 5303; R.C. 1943, § 47-0401; S.L. 1995, ch. 435, § 1.
Derivation:
Cal. Civ. C., 755.
Notes to Decisions
Covenant Running With the Land.
Court did not err in finding the planned unit development (PUD) had authority to impose assessments against the owner’s property, because the owner’s warranty deed plainly stated in its legal description that her property was within the PUD, and the amended declaration for the PUD was recorded and the owner was charged with constructive notice of its contents, including provisions imposing covenants running with her property; the owner’s obligations to the PUD were imposed by the covenants running with the land and she was bound by the amended declaration’s relevant provisions by the purchase of her property within the development. Wheeler v. Southport Seven Planned Unit Dev., 2012 ND 201, 821 N.W.2d 746, 2012 N.D. LEXIS 209 (N.D. 2012).
Collateral References.
Res judicata or collateral estoppel effect, in state where real property is located, of foreign decree dealing with such property, 32 A.L.R.3d 1330.
47-04-02. Classification of estates as to duration.
Estates in real property in respect to the duration of their enjoyment are:
- Estates of inheritance or perpetual estates;
- Estates for life;
- Estates for years; or
- Estates at will.
Source:
Civ. C. 1877, § 218; R.C. 1895, § 3325; R.C. 1899, § 3325; R.C. 1905, § 4761; C.L. 1913, § 5304; R.C. 1943, § 47-0402.
Derivation:
Cal. Civ. C., 761.
Notes to Decisions
Servant on Premises.
A servant who occupies real property as incidental to and as a part of his employment has no estate therein, and is not in possession thereof against his master. Davis v. Long, 45 N.D. 581, 178 N.W. 936, 1920 N.D. LEXIS 164 (N.D. 1920).
Law Reviews.
Estates in North Dakota, 30 N.D. L. Rev. 289 (1954).
47-04-03. Estates — Classification and definition.
Estates of inheritance and for life are called estates of freehold. Estates for years are chattels real. Estates at will are chattel interests, but are not liable as such to sale on execution.
Source:
Civ. C. 1877, § 222; R.C. 1895, § 3329; R.C. 1899, § 3329; R.C. 1905, § 4765; C.L. 1913, § 5308; R.C. 1943, § 47-0403.
Derivation:
Cal. Civ. C., 765.
47-04-04. Estate in fee defined.
Every estate of inheritance is a fee, and every such estate, when not defeasible or conditional, is a fee simple or an absolute fee.
Source:
Civ. C. 1877, § 219; R.C. 1895, § 3326; R.C. 1899, § 3326; R.C. 1905, § 4762; C.L. 1913, § 5305; R.C. 1943, § 47-0404.
Notes to Decisions
Language Not Passing Less than Fee Simple.
Where the testator owned land in fee simple, a devise of grain bins “with the right to utilize said bins upon the premises where they are now situated without paying any rent therefor,” was not a limitation that reflected an intent to pass less than a fee simple absolute title limiting the devise to the length of a person’s life. Schatz v. Schatz, 419 N.W.2d 903, 1988 N.D. LEXIS 54 (N.D. 1988).
Collateral References.
Park or playground purposes, nature of estate conveyed by deed for, 15 A.L.R.2d 975, 988.
Fee simple absolute estate as created by devise to one and heirs if donee shall have any heirs, 16 A.L.R.2d 670, 678.
Gift or grant in term sufficient to carry the whole property absolutely as so operating where followed by a purported limitation over of property not disposed of by the first taker, 17 A.L.R.2d 7.
Home: quantum or character of estate or interest created by language providing premises as a home, or giving or granting same for such use, 45 A.L.R.2d 699.
“Blood heirs” or “blooded heirs”, estate created by deed to one and, 89 A.L.R.2d 1222.
Railroad: deed to railroad company as conveying fee or easement, 6 A.L.R.3d 973.
Admissibility of extrinsic evidence to determine whether fee or absolute interest, or only estate for life or years, was given, 21 A.L.R.3d 778.
47-04-05. Estates tail abolished — Declared fees.
Estates tail are abolished and every estate which would be adjudged a fee tail at common law is a fee simple, and if no valid remainder is limited thereon, is a fee simple absolute.
Source:
Civ. C. 1877, § 220; R.C. 1895, § 3327; R.C. 1899, § 3327; R.C. 1905, § 4763; C.L. 1913, § 5306; R.C. 1943, § 47-0405.
Derivation:
Cal. Civ. C., 763.
Collateral References.
Fee tail as created by grant to one and heirs if donee should have any heirs, 16 A.L.R.2d 670, 678.
Reversion or remainder, rule as to effect of grant to one for life and in specified event to heirs or next of kin of grantor to create, as related to rule in Shelley’s Case, 16 A.L.R.2d 691, 714.
Conflict between granting and habendum clauses as to estate conveyed, 58 A.L.R.2d 1374.
“Blood heirs” or “blooded heirs”, estate created by deed to one and, 89 A.L.R.2d 1222.
47-04-06. Fee tail valid as contingent limitation upon a fee.
Where a remainder in fee is limited upon any estate which, by the common law, would be adjudged a fee tail, such remainder is valid as a contingent limitation upon a fee and vests in possession on the death of the first taker, without issue living at the time of that person’s death.
Source:
Civ. C. 1877, § 221; R.C. 1895, § 3328; R.C. 1899, § 3328; R.C. 1905, § 4764; C.L. 1913, § 5307; R.C. 1943, § 47-0406.
Derivation:
Cal. Civ. C., 764.
47-04-07. Estate for life is freehold.
An estate during the life of a third person, whether limited to heirs or otherwise, is a freehold.
Source:
Civ. C. 1877, § 223; R.C. 1895, § 3330; R.C. 1899, § 3330; R.C. 1905, § 4766; C.L. 1913, § 5309; R.C. 1943, § 47-0407.
Derivation:
Cal. Civ. C., 766.
Collateral References.
Life estate as created by grant to one and heirs if donee should have any heirs, 16 A.L.R.2d 670, 678.
Grant in terms sufficient to carry the whole property absolutely as so operating where followed by a purported limitation over of property not disposed of by the first taker, 17 A.L.R.2d 7.
Nontrust life estate expressly given for support and maintenance as limited thereto, 26 A.L.R.2d 1207.
Life estate as created by language providing premises as a home, or giving or granting same for such use, 45 A.L.R.2d 699.
Admissibility of extrinsic evidence to determine whether fee or absolute interest, or only estate for life or years, was given under will, 21 A.L.R.3d 778.
47-04-08. Future estate limited.
A future estate may be limited by the act of the party to commence in possession at a future day, either without the intervention of a precedent estate, on the termination by lapse of time, or otherwise, of a precedent estate created at the same time.
Source:
Civ. C. 1877, § 224; R.C. 1895, § 3331; R.C. 1899, § 3331; R.C. 1905, § 4767; C.L. 1913, § 5310; R.C. 1943, § 47-0408.
Derivation:
Cal. Civ. C., 767.
47-04-09. Reversion defined.
A reversion is the residue of an estate left by operation of law in the grantor or the grantor’s successors or in the successors of a testator commencing in possession on the determination of a particular estate granted or devised.
Source:
Civ. C. 1877, § 225; R.C. 1895, § 3332; R.C. 1899, § 3332; R.C. 1905, § 4768; C.L. 1913, § 5311; R.C. 1943, § 47-0409.
Derivation:
Cal. Civ. C., 768.
Notes to Decisions
Remainder or Reversion.
A future estate is a remainder only when it cannot be a reversion, and it cannot be both at the same time. Sailer v. Mercer County, 75 N.D. 123, 26 N.W.2d 137, 1947 N.D. LEXIS 52 (N.D. 1947).
Collateral References.
Remainder or reversion as resulting from grant to one for life, and in specified event to heirs or next of kin of grantor, 16 A.L.R.2d 691, 714.
Devisability of possibility of reverter, or of right of reentry for breach of condition subsequent, 16 A.L.R.2d 1246.
Validity and effect of transfer of possibility of reverter or right of reentry, following conveyance of determinable fee or fee subject to condition subsequent, 53 A.L.R.2d 224.
Validity of statute canceling, destroying, nullifying, or limiting enforcement of possibilities of reverter or rights of re-entry for condition broken, 87 A.L.R.3d 1011.
47-04-10. Remainder defined.
When a future estate, other than a reversion, is dependent on a precedent estate, it may be called a remainder and may be created and transferred by that name.
Source:
Civ. C. 1877, § 226; R.C. 1895, § 3333; R.C. 1899, § 3333; R.C. 1905, § 4769; C.L. 1913, § 5312; R.C. 1943, § 47-0410.
Derivation:
Cal. Civ. C., 769.
Notes to Decisions
Remainder or Reversion.
A future estate is a remainder only when it cannot be a reversion, and it cannot be both at the same time. Sailer v. Mercer County, 75 N.D. 123, 26 N.W.2d 137, 1947 N.D. LEXIS 52 (N.D. 1947).
Vested Remainder.
A person who is vested with title to land through the will of his father, though the land is subject to the life estate of his mother, is the owner of a vested remainder which is real property subject to the lien of a judgment. John Leslie Paper Co. v. Wheeler, 23 N.D. 477, 137 N.W. 412, 1912 N.D. LEXIS 110 (N.D. 1912).
Collateral References.
Possibility of issue extinct, doctrine as to, as affecting property rights, 98 A.L.R.2d 1285.
Grant to one for life, and afterwards, either absolutely or contingently, to grantor’s heirs or next of kin as leaving reversion or creating remainder, 16 A.L.R.2d 691, 714.
Comment note: “Divide and pay over” rule, for purposes of determining vested or contingent character of estate, as affected by postponing enjoyment to let in an intermediate interest, 16 A.L.R.2d 1383.
Nature of remainders created by will giving life estate to spouse of testator, with remainder to be divided equally between testator’s heirs and spouse’s heirs, 19 A.L.R.2d 371.
Gift or grant to one upon marriage, if married, payable at marriage, or the like, as vested or contingent, 30 A.L.R.2d 127.
Provision of will that children, etc., of remainderman who dies before expiration of precedent estate or time fixed for distribution to remaindermen, shall take the share to which he would have been entitled, as affecting the character of remainder as vested or contingent, 47 A.L.R.2d 900.
Character of remainder limited generally to life tenant’s children, 57 A.L.R.2d 103.
Nature of remainder created by inter vivos trust giving settlor, trustee or life beneficiary power to exhaust trust fund or otherwise terminate trust, 61 A.L.R.2d 477.
Survival: Where will names two or more remaindermen to take under different contingencies, must the one whose contingency occurs survive the other to make his interest transmissible?, 90 A.L.R.2d 312.
47-04-11. Limitation of suspension of absolute ownership. [Repealed]
Repealed by S.L. 1991, ch. 484, § 6.
Note.
See now Uniform Statutory Rule Against Perpetuities, N.D.C.C. §§ 47-02-27.1 to 47-02-27.5.
47-04-12. Trust — Suspension of power to alienate the same. [Repealed]
Repealed by S.L. 1991, ch. 484, § 6.
Note.
See now Uniform Statutory Rule Against Perpetuities, N.D.C.C. §§ 47-02-27.1 to 47-02-27.5.
47-04-13. Contingent remainder created on prior remainder — Effect. [Repealed]
Repealed by omission from this code.
47-04-14. Creation of estate — Limitation.
Subject to the provisions of this chapter and of chapters 47-01, 47-02, and 47-03, a freehold estate, as well as a chattel real, may be created to commence at a future day; an estate for life may be created in a term of years and a remainder limited thereon; a remainder of a freehold or chattel real, either contingent or vested, may be created, expectant on the determination of a term of years; and a fee may be limited on a fee upon a contingency which, if it should occur, must happen within the period prescribed in this chapter.
Source:
Civ. C. 1877, § 230; R.C. 1895, § 3337; R.C. 1899, § 3337; R.C. 1905, § 4773; C.L. 1913, § 5316; R.C. 1943, § 47-0414.
Derivation:
Cal. Civ. C., 773.
47-04-15. Life estates — Successive limitations. [Repealed]
Repealed by omission from this code.
47-04-16. Remainder upon successive life estates. [Repealed]
Repealed by omission from this code.
47-04-17. Contingent remainder on term of years — Limitation. [Repealed]
Repealed by omission from this code.
47-04-18. Life estate — Limitation on term of years. [Repealed]
Repealed by omission from this code.
47-04-19. Remainder limited on contingency.
A remainder may be limited on a contingency which, in case it should happen, will operate to abridge or determine the precedent estate. Every such remainder shall be deemed a conditional limitation.
Source:
Civ. C. 1877, § 235; R.C. 1895, § 3342; R.C. 1899, § 3342; R.C. 1905, § 4778; C.L. 1913, § 5321; R.C. 1943, § 47-0419.
Derivation:
Cal. Civ. C., 778.
47-04-20. Remainder limited to heirs of body of life tenant — Rule in Shelley’s Case abolished.
When a remainder is limited to the heirs, or heirs of the body, of a person to whom a life estate in the same property is given, the persons who, on the termination of the life estate are the successors or heirs of the body of the owner for life, are entitled to take by virtue of the remainder so limited to them and not as mere successors of the owner for life.
Source:
Civ. C. 1877, § 236; R.C. 1895, § 3343; R.C. 1899, § 3343; R.C. 1905, § 4779; C.L. 1913, § 5322; R.C. 1943, § 47-0420.
Derivation:
Cal. Civ. C., 779.
47-04-21. Remainder limited on estate for life or years — When effective.
When a remainder on an estate for life or for years is not limited on a contingency defeating or avoiding such precedent estate, it shall be deemed intended to take effect only on the death of the first taker or the expiration by lapse of time of such term of years.
Source:
Civ. C. 1877, § 237; R.C. 1895, § 3344; R.C. 1899, § 3344; R.C. 1905, § 4780; C.L. 1913, § 5323; R.C. 1943, § 47-0421.
Derivation:
Cal. Civ. C., 780.
47-04-22. Estate in fee, remainder, or reversion — Right of action.
A person having an estate in fee, in remainder, or reversion may maintain an action for an injury done to the inheritance, notwithstanding an intervening estate for life or years and although after its commission the person’s estate is transferred and the person has no interest in the property at the commencement of the action.
Source:
Civ. C. 1877, § 264; R.C. 1895, § 3371; R.C. 1899, § 3371; R.C. 1905, § 4807; C.L. 1913, § 5350; R.C. 1943, § 47-0422.
Derivation:
Cal. Civ. C., 826.
Notes to Decisions
Valid Cause of Action.
District court erred as a matter of law when it held that a vested remainderman did not have an action for waste against a life tenant for the removal of an airplane hanger upon the property. Ruggles v. Sabe, 2003 ND 159, 670 N.W.2d 356, 2003 N.D. LEXIS 175 (N.D. 2003).
47-04-23. Effect of unexecuted power.
A general or special power of appointment does not prevent the vesting of a future estate limited to take effect in case such power is not executed.
Source:
Civ. C. 1877, § 238; R.C. 1895, § 3345; R.C. 1899, § 3345; R.C. 1905, § 4781; C.L. 1913, § 5324; R.C. 1943, § 47-0423.
Derivation:
Cal. Civ. C., 781.
Collateral References.
Partial exercise of power of appointment, 4 A.L.R.2d 919.
Appointee’s renunciation of appointment, 9 A.L.R.2d 1382.
Revocation or amendment of exercise of power to appoint future interest, after exercise by inter vivos instrument, 60 A.L.R.3d 143.
Validity of testamentary provision making gift to person or persons meeting specified qualification and authorizing another to determine who qualifies, 74 A.L.R.3d 1073.
47-04-24. Covenants running with the land defined.
Certain covenants contained in grants of estates in real property are appurtenant to such estates and pass with them so as to bind the assigns of the covenantor and to vest in the assigns of the covenantee in the same manner as if they personally had entered into them. Such covenants are said to run with the land.
Source:
Civ. C. 1877, § 819; R.C. 1895, § 3784; R.C. 1899, § 3784; R.C. 1905, § 5229; C.L. 1913, § 5785; R.C. 1943, § 47-0424.
Derivation:
Cal. Civ. C., 1460.
Notes to Decisions
- Benefit to Adjoining Land.
- Covenant Not Running With the Land.
- Covenant Running With the Land.
- Invalid Covenants.
- Restrictions on Future Use of Land.
Benefit to Adjoining Land.
If a covenant is imposed for the benefit of the grantor’s adjoining land of which he remains the owner, the right to enforce the same passes to the grantees of the adjoining land. Anderson v. Marshall-Malaise Lumber Co., 66 N.D. 216, 263 N.W. 721, 1935 N.D. LEXIS 190 (N.D. 1935).
Covenant Not Running With the Land.
District court erred in holding that the intent of the original parties to a deed was controlling and created a perpetual covenant for payments to the sellers of a portion of waste disposal fees generated from a landfill upon the subject property that was binding upon the successor to the buyer’s interest because the covenant did not benefit the land and did not run with the land. Beeter v. Sawyer Disposal LLC, 2009 ND 153, 771 N.W.2d 282, 2009 N.D. LEXIS 161 (N.D. 2009).
Covenant Running With the Land.
Court did not err in finding the planned unit development (PUD) had authority to impose assessments against the owner’s property, because the owner’s warranty deed plainly stated in its legal description that her property was within the PUD, and the amended declaration for the PUD was recorded and the owner was charged with constructive notice of its contents, including provisions imposing covenants running with her property; the owner’s obligations to the PUD were imposed by the covenants running with the land and she was bound by the amended declaration’s relevant provisions by the purchase of her property within the development. Wheeler v. Southport Seven Planned Unit Dev., 2012 ND 201, 821 N.W.2d 746, 2012 N.D. LEXIS 209 (N.D. 2012).
Invalid Covenants.
Where the covenantor has neither title nor possession, the covenants do not run with the land so as to transfer the cause of action for the breach thereof to remote grantees by deeds purporting to convey the land. Bull v. Beiseker, 16 N.D. 290, 113 N.W. 870, 1907 N.D. LEXIS 68 (N.D. 1907).
Restrictions on Future Use of Land.
One owning the fee has the right to sell his land subject to such reservations or restrictions as to its future use and enjoyment as he may see fit to impose, provided they are not contrary to public policy. Anderson v. Marshall-Malaise Lumber Co., 66 N.D. 216, 263 N.W. 721, 1935 N.D. LEXIS 190 (N.D. 1935).
Collateral References.
Subdivision: omission from deed of restrictive covenant imposed by general plan of subdivision, 4 A.L.R.2d 1364, 1368.
College fraternity’s or sorority’s use of property as violation of restrictive covenant, 7 A.L.R.2d 436.
Alienation: rule limiting duration of restraints on alienation as applicable to covenant in deed restricting use of property, 10 A.L.R.2d 824.
Church as violation of covenant restricting use of property, 13 A.L.R.2d 1239.
Multiple residence as violation of restrictive covenant, 14 A.L.R.2d 1376.
Insurance: covenant of lessee to insure as running with the land, 18 A.L.R.2d 1051.
Affirmative covenants as running with the land, 68 A.L.R.2d 1022.
Conveyance “subject to” restrictions set forth in a recorded or other indicated instrument as imposing the restrictions on the land conveyed, 84 A.L.R.2d 780.
Hospital, sanitarium, home for aged, nursing home or the like as violation of restrictive covenant, 94 A.L.R.2d 726.
Building: what constitutes a “building” within restrictive covenant, 18 A.L.R.3d 850.
Consent: validity and construction of restrictive covenant requiring consent to construction on lot, 40 A.L.R.3d 864.
Building materials: covenant in deed restricting material to be used in building construction, 41 A.L.R.3d 1290.
Architectural style of buildings to be erected on land, validity and construction of restrictive covenant controlling, 47 A.L.R.3d 1232.
Enforcement: who may enforce restrictive covenant or agreement as to use of real property, 51 A.L.R.3d 556.
Change of neighborhood as affecting restrictive covenants precluding use of land for multiple dwelling, 53 A.L.R.3d 492.
Condominium: erection of condominium as violation of restrictive covenant forbidding erection of apartment houses, 65 A.L.R.3d 1212.
Use of property for multiple dwellings as violating restrictive covenant permitting property to be used for residential purposes only, 99 A.L.R.3d 985.
Restrictive covenants as to height of structures or buildings, 1 A.L.R.4th 1021.
Community residence for mentally disabled persons as violation of restrictive covenant, 41 A.L.R.4th 1216.
Restrictive covenant limiting land use to “private residence” or “private residential purposes”: interpretation and application, 43 A.L.R.4th 71.
Change in character of neighborhood as affecting validity or enforceability of restrictive covenant, 76 A.L.R.5th 337.
47-04-25. Covenants running with the land.
The only covenants which run with the land are those specified in this chapter and those which are incidental thereto.
Source:
Civ. C. 1877, § 820; R.C. 1895, § 3785; R.C. 1899, § 3785; R.C. 1905, § 5230; C.L. 1913, § 5786; R.C. 1943, § 47-0425.
Derivation:
Cal. Civ. C., 1461.
Notes to Decisions
Covenant Running With the Land.
Court did not err in finding the planned unit development (PUD) had authority to impose assessments against the owner’s property, because the owner’s warranty deed plainly stated in its legal description that her property was within the PUD, and the amended declaration for the PUD was recorded and the owner was charged with constructive notice of its contents, including provisions imposing covenants running with her property; the owner’s obligations to the PUD were imposed by the covenants running with the land and she was bound by the amended declaration’s relevant provisions by the purchase of her property within the development. Wheeler v. Southport Seven Planned Unit Dev., 2012 ND 201, 821 N.W.2d 746, 2012 N.D. LEXIS 209 (N.D. 2012).
Covenants Not Running with Land.
Covenants which do not run with the land are covenants of seisin, right to convey, and covenants against encumbrances. Gale v. Frazier, 30 N.W. 138, 4 Dakota 196, 1886 Dakota LEXIS 15 (Dakota 1886).
Covenants of seisin do not run with the land in this state. Bowne v. Wolcott, 1 N.D. 497, 48 N.W. 426, 1891 N.D. LEXIS 15 (N.D. 1891).
District court erred in holding that the intent of the original parties to a deed was controlling and created a perpetual covenant for payments to the sellers of a portion of waste disposal fees generated from a landfill upon the subject property that was binding upon the successor to the buyer’s interest because the covenant did not benefit the land and did not run with the land. Beeter v. Sawyer Disposal LLC, 2009 ND 153, 771 N.W.2d 282, 2009 N.D. LEXIS 161 (N.D. 2009).
Under North Dakota law, the only covenants that ran with the land were those specified by statute and those that were incidental thereto. A federal district court properly held that under North Dakota law, an area of mutual interest agreement (AMI) covenant did not run with the land but rather was a personal covenant that was enforceable only between the original parties to an agreement. Spring Creek Exploration & Prod. Co., LLC v. Hess Bakken Invs. II, LLC, 882 F.3d 1176, 2018 U.S. App. LEXIS 4096 (10th Cir. Colo. 2018).
On review of orders dismissing contract and tort claims against defendants, the covenants at issue did not run with the land because the North Dakota Supreme Court had definitively held that area of mutual interest agreements were personal covenants, not covenants made for direct benefit of property. Spring Creek Exploration & Prod. Co., LLC v. Hess Bakken Invs. II, LLC, 2018 U.S. App. LEXIS 9803 (10th Cir. Colo. Apr. 10, 2018).
47-04-25.1. Modification of covenants running with the land.
A covenant running with the land executed after August 1, 1997, must contain provisions addressing the modification of the covenant. If a covenant running with the land does not contain provisions relating to the modification of the covenant, eighty-five percent of all of the owners of the real property subject to the covenant may agree, in writing, to amend the covenant to include provisions relating to the modification of the covenant. Following approval of any modification, the modified covenant must be filed for recording with the recorder. This section does not apply to subdivisions that are not completed unless the subdivision has been in development for over fifteen years.
Source:
S.L. 1997, ch. 387, § 1; 2001, ch. 120, § 1.
47-04-26. Covenants running with the land — Classification.
All covenants contained in a grant of an estate in real property, which are made for the direct benefit of the property or some part of it then in existence, run with the land. Such covenants include covenants:
- Of warranty;
- For quiet enjoyment;
- For further assurance on the part of a grantor; or
- For the payment of rent, taxes, or assessments upon the land on the part of a grantee.
Source:
Civ. C. 1877, §§ 821, 822; R.C. 1895, §§ 3786, 3787; R.C. 1899, §§ 3786, 3787; R.C. 1905, §§ 5231, 5232; C.L. 1913, §§ 5787, 5788; R.C. 1943, § 47-0426.
Derivation:
Cal. Civ. C., 1462, 1463.
Cross-References.
Covenants implied from use of word “grant” in conveyance of realty, see N.D.C.C. § 47-10-19.
Notes to Decisions
- Building Restrictions.
- Covenant for Payment of Rent.
- Covenant of Seisin.
- Covenant of Warranty.
- Covenant Running With the Land.
- Covenants Not Running With Land.
- Covenants Not Specified.
Building Restrictions.
A covenant not to erect other than fireproof buildings is for the benefit of the adjoining land and runs with the land. Anderson v. Marshall-Malaise Lumber Co., 66 N.D. 216, 263 N.W. 721, 1935 N.D. LEXIS 190 (N.D. 1935).
Covenant for Payment of Rent.
When lessee exercises his option to purchase, the lessor is no longer entitled to rent unless there is an express stipulation in the lease so providing. Amann v. Frederick, 257 N.W.2d 436, 1977 N.D. LEXIS 161 (N.D. 1977).
Covenant of Seisin.
A covenant of seisin is broken if the covenantor does not have possession, right of possession, and the complete legal title, and when the covenant is broken an immediate cause of action arises. Mercer County State Bank v. Hayes, 34 N.D. 601, 159 N.W. 74, 1916 N.D. LEXIS 62 (N.D. 1916).
Covenant of Warranty.
A covenant of warranty of title in a grant of real property runs with the land. Aure v. Mackoff, 93 N.W.2d 807, 1958 N.D. LEXIS 109 (N.D. 1958).
Covenant Running With the Land.
Court did not err in finding the planned unit development (PUD) had authority to impose assessments against the owner’s property, because the owner’s warranty deed plainly stated in its legal description that her property was within the PUD, and the amended declaration for the PUD was recorded and the owner was charged with constructive notice of its contents, including provisions imposing covenants running with her property; the owner’s obligations to the PUD were imposed by the covenants running with the land and she was bound by the amended declaration’s relevant provisions by the purchase of her property within the development. Wheeler v. Southport Seven Planned Unit Dev., 2012 ND 201, 821 N.W.2d 746, 2012 N.D. LEXIS 209 (N.D. 2012).
Covenants Not Running With Land.
District court erred in holding that the intent of the original parties to a deed was controlling and created a perpetual covenant for payments to the sellers of a portion of waste disposal fees generated from a landfill upon the subject property that was binding upon the successor to the buyer’s interest because the covenant did not benefit the land and did not run with the land. Beeter v. Sawyer Disposal LLC, 2009 ND 153, 771 N.W.2d 282, 2009 N.D. LEXIS 161 (N.D. 2009).
Under North Dakota law, the only covenants that ran with the land were those specified by statute and those that were incidental thereto. A federal district court properly held that under North Dakota law, an area of mutual interest agreement (AMI) covenant did not run with the land but rather was a personal covenant that was enforceable only between the original parties to an agreement. Spring Creek Exploration & Prod. Co., LLC v. Hess Bakken Invs. II, LLC, 882 F.3d 1176, 2018 U.S. App. LEXIS 4096 (10th Cir. Colo. 2018).
On review of orders dismissing contract and tort claims against defendants, the covenants at issue did not run with the land because the North Dakota Supreme Court had definitively held that area of mutual interest agreements were personal covenants, not covenants made for direct benefit of property. Spring Creek Exploration & Prod. Co., LLC v. Hess Bakken Invs. II, LLC, 2018 U.S. App. LEXIS 9803 (10th Cir. Colo. Apr. 10, 2018).
In a case involving an oil-and-gas exploration and production agreement containing an incentive payment for sharing of drilling costs, district court did not err in concluding the incentive payment was not a covenant running with the land under this statute because the shared drilling costs was at best an indirect benefit to the land. Slawson Expl. Co. v. Nine Point Energy, LLC, 966 F.3d 775, 2020 U.S. App. LEXIS 22635 (8th Cir. N.D. 2020).
In an adversary proceeding seeking a declaration of rights under a gas and oil lease service agreement, the service agreement did not run with the land because it was not enough for the parties to call something a covenant that ran with the land, it was not an easement that was an estate in property or appurtenant to property, and the right to control produced oil and gas was not the grant of an interest in real property. Nine Pont Energy Holdings, Inc. v. Caliber Measurement Servs. LLC (In re Nine Point Energy Holdings Inc.), — B.R. —, — B.R. —, 2021 Bankr. LEXIS 1486 (Bankr. D. Del. June 1, 2021).
Covenants Not Specified.
Covenants running with the land are not confined to those specifically named, but include those which are implied. Northern Pac. Ry. v. McClure, 9 N.D. 73, 81 N.W. 52, 1899 N.D. LEXIS 109 (N.D. 1899).
Collateral References.
Restrictive covenant limiting land use to “private residence” or “private residential purposes”: interpretation and application, 43 A.L.R.4th 71.
47-04-27. Covenants — Limitation to designated assigns.
A covenant for the addition of some new thing to real property, or for the direct benefit of some part of the property not then in existence or annexed thereto, when contained in a grant of an estate in such property and made by the covenantor expressly for the covenantor’s assigns or to the assigns of the covenantee, runs with the land so far only as the assigns thus mentioned are concerned.
Source:
Civ. C. 1877, § 823; R.C. 1895, § 3788; R.C. 1899, § 3788; R.C. 1905, § 5233; C.L. 1913, § 5789; R.C. 1943, § 47-0427.
Derivation:
Cal. Civ. C., 1464.
47-04-28. Covenants running with the land — Owner of entire estate bound.
A covenant running with the land binds only those who acquire the whole estate of the covenantor in some part of the property.
Source:
Civ. C. 1877, § 824; R.C. 1895, § 3789; R.C. 1899, § 3789; R.C. 1905, § 5234; C.L. 1913, § 5790; R.C. 1943, § 47-0428.
Derivation:
Cal. Civ. C., 1465.
Notes to Decisions
Personal Restriction.
If a restriction or reservation is imposed for the personal benefit or convenience of the grantor, he is the only one who can enforce it. Anderson v. Marshall-Malaise Lumber Co., 66 N.D. 216, 263 N.W. 721, 1935 N.D. LEXIS 190 (N.D. 1935).
47-04-29. Covenants running with the land — Liability as holder only.
A person, merely by reason of having acquired an estate subject to a covenant running with the land, is not liable for breach of the covenant before the person acquired the estate, or after the person has parted with it or ceased to enjoy its benefits.
Source:
Civ. C. 1877, § 825; R.C. 1895, § 3790; R.C. 1899, § 3790; R.C. 1905, § 5235; C.L. 1913, § 5791; R.C. 1943, § 47-0429.
Derivation:
Cal. Civ. C., 1466.
47-04-30. Covenants running with the land — Apportionment of benefit or burden.
When several persons, holding by several titles, are subject to the burden or are entitled to the benefit of a covenant running with the land, it must be apportioned among them according to the value of the property subject to it held by them respectively, if such value can be ascertained, and if not, then according to their respective interests in point of quantity.
Source:
Civ. C. 1877, § 826; R.C. 1895, § 3791; R.C. 1899, § 3791; R.C. 1905, § 5236; C.L. 1913, § 5792; R.C. 1943, § 47-0430.
Derivation:
Cal. Civ. C., 1467.
47-04-31. Highways, railways, or rights of way — Covenants of warranty.
No covenants of warranty shall be considered as broken by the existence of a highway, railway, or a right of way for either, upon the land conveyed by any instrument of conveyance, unless otherwise particularly specified in the deed. Whenever in any instrument of conveyance delivered, filed, and recorded prior to the first day of January 1896, the grantor has conveyed real property in this state, but has reserved or sought to reserve a right of way over or across the same for the future construction of any railroad or highway without specifically locating or describing therein by metes and bounds such right of way, or proposed right of way, or by reference to permanent marks or monuments, such reservation shall be void in all things, and such conveyance shall have the same effect as if no such reservation had been made or attempted to have been made therein unless on July 1, 1907:
- The grantor or the grantor’s successor in interest was in actual possession of, or had located and permanently marked said right of way;
- Within one year thereafter filed or caused to be filed in the office of the recorder of the county wherein the land is situated, a plat describing such selection and such right of way, properly acknowledged so as to entitle the same to be recorded, and so as to distinguish readily and designate such right of way from the entire premises described in the conveyance from which it was attempted to be reserved; or
- Within such one-year period, an action was commenced in a court of competent jurisdiction for the purpose of definitely determining and locating such right of way, and establishing the owner’s right thereto, and in such case had filed and recorded a proper notice of lis pendens in the office of the recorder of the county in which such land was located.
Source:
S.L. 1901, ch. 64, § 1; R.C. 1905, § 5404; S.L. 1907, ch. 251, § 1; C.L. 1913, § 5960; R.C. 1943, § 47-0431; S.L. 2001, ch. 120, § 1.
Notes to Decisions
Easement.
Order holding that a railroad company had a valid easement on an owner’s property was upheld where the easement was properly described; the railroad tracks were in place when the owner obtained the property well over a decade ago and remained in place. Burlington Northern R.R. v. Fail, 2008 ND 114, 751 N.W.2d 188, 2008 N.D. LEXIS 115 (N.D. 2008).
Collateral References.
Construction and application of restricted covenants to the use of signs, 61 A.L.R.4th 1028.
47-04-32. Covenant may not prohibit display of political signs.
Notwithstanding any provision in a covenant, a covenant running with the land may not prohibit the outdoor display of a political yard sign by the owner or a resident on the owner’s property within sixty days before any primary, general, or special election. A covenant may include reasonable rules regarding the placement and manner of display of political signs.
Source:
S.L. 2007, ch. 395, § 1.
CHAPTER 47-04.1 Condominium Ownership of Real Property
47-04.1-01. Definitions.
In this chapter, unless context otherwise requires:
- “Common areas” means the entire project excepting all units therein granted or reserved.
- “Condominium” is an estate in real property consisting of an undivided interest or interests in common in a portion of a parcel of real property together with a separate interest or interests in space in a structure, on such real property.
- “Interest” means the fractional or percentage interest or interests ascribed to each unit by the declaration provided for in section 47-04.1-03.
- “Limited common areas” means those elements designed for use by the owners of one or more but less than all of the units included in the project.
- “Project” means the entire parcel of real property divided, or to be divided into condominiums, including all structures thereon.
- “To divide” real property means to divide the ownership thereof by conveying one or more condominiums therein but less than the whole thereof.
- “Unit” means the elements of a condominium which are not owned in common with the owners of other condominiums in the project.
Source:
S.L. 1965, ch. 311, § 1.
Notes to Decisions
Assessments on Condominium Units.
Whether the bank would be liable for assessments on unconstructed condominium units purchased at foreclosure depended upon whether or not it agreed, when it took the mortgage, that unconstructed units would be subject to assessment or knew, when it took the mortgage, that unconstructed units would be subject to assessment and acquiesced in such assessment, which were questions of fact precluding summary judgment. Century Park Condominium Ass'n v. Norwest Bank Bismarck, Nat'l Ass'n, 420 N.W.2d 349, 1988 N.D. LEXIS 49 (N.D. 1988).
Nothing in this section or section 47-04.1-11 prohibits assessments on unconstructed units for common expenses or prohibits personal liability of owners for such assessments by agreement; therefore, parties may, by agreement, provide for assessments and personal liability. Century Park Condominium Ass'n v. Norwest Bank Bismarck, Nat'l Ass'n, 420 N.W.2d 349, 1988 N.D. LEXIS 49 (N.D. 1988).
Condominium Ownership in General.
A condominium combines two distinct forms of ownership of real property: (1) exclusive ownership of an individual unit of a multi-unit condominium project, and (2) ownership as a tenant in common of the common area of the project, in proportion to each unit’s interest in the total project. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Condominium association had standing to intervene in a declaratory judgment action to determine what party was entitled to insurance proceeds arising out of damage done to its condominium complex roof, as it had associational standing because it was tasked with representing the interests of its members who lived in the condominium complex. Under the law governing condominiums, N.D.C.C. § 47-04.1-01 et seq., it had to record restrictions that were enforceable against any condominium unit owner, N.D.C.C. § 47-04.1-04, and it had to administer its bylaws to operate the condominium complex for the benefit of its members, N.D.C.C. § 47-04.1-07(1), which included fixing the roof for the benefit of its members. First Int'l Bank & Trust v. Peterson, 2011 ND 87, 797 N.W.2d 316, 2011 N.D. LEXIS 87 (N.D. 2011).
Collateral References.
Premises liability: liability of condominium association or corporation for injury allegedly caused by condition of premises, 45 A.L.R.3d 1171.
Defects: liability of vendor of condominiums for damages occasioned by defective condition thereof, 50 A.L.R.3d 1071.
Covenants: erection of condominium as violation of restrictive covenant forbidding erection of apartment houses, 65 A.L.R.3d 1212.
Injury to common areas of condominium development, proper party plaintiff in action for, 69 A.L.R.3d 1148.
Zoning or building regulations as applied to condominiums, 71 A.L.R.3d 866.
Self-dealing by developers of condominium project as affecting contracts or leases with condominium association, 73 A.L.R.3d 613.
Standing to bring action relating to real property of condominium, 74 A.L.R.4th 165.
Law Reviews.
Condominium: The Theory and the North Dakota Practice, J. Phillip Johnson, 44 N.D. L. Rev. 345 (1968).
Condominium Practice: A Second Look, J. Phillip Johnson, 51 N.D. L. Rev. 761 (1975).
Time Share Ownership: A Primer, 57 N.D. L. Rev. 151 (1981).
47-04.1-02. Recording of declaration to submit property to a project.
When the sole owner or all the owners, or the sole lessee or all of the lessees of a lease desire to submit a parcel of real property to a project established by this chapter, a declaration to that effect shall be executed and acknowledged by the sole owner or lessee or all of such owners or lessees and shall be recorded in the office of the recorder of the county in which such property lies.
Source:
S.L. 1965, ch. 311, § 2; 2001, ch. 120, § 1.
47-04.1-03. Contents of declaration.
The declaration provided for in section 47-04.1-02 shall contain:
- A description or survey map of the surface of the land included within the project.
- Diagrammatic floor plans of the structures built or to be built thereon in sufficient detail to identify each unit, its relative location and approximate dimensions.
- A description of the common elements.
- A description of the limited common elements.
- The fractional or percentage interest which each unit bears to the entire project. The sum of such shall be one if expressed in fractions and one hundred if expressed in percentage.
Source:
S.L. 1965, ch. 311, § 3.
47-04.1-04. Declaration of restrictions.
The owner of a project, shall, prior to the conveyance of any condominium therein, record a declaration of restrictions relating to such project, which restrictions shall be enforceable equitable servitudes where reasonable, and shall inure to and bind all owners of condominiums in the project. Such servitudes, unless otherwise provided, may be enforced by any legal or equitable owner of a condominium in the project.
Source:
S.L. 1965, ch. 311, § 4.
Notes to Decisions
- Amendment to Declaration of Restrictions.
- Enforcement of Restrictions.
- Restriction Defined.
- Waiver of Right to Notice of Restriction.
Amendment to Declaration of Restrictions.
This section prohibited the retroactive application of an amendment to the declaration of restrictions, which prohibited the leasing of the condominium units to nonowners except in limited circumstances, to those persons who had purchased a unit prior to the promulgation of the amendment and who had not acquiesced in such amendment. Breene v. Plaza Tower Ass'n, 310 N.W.2d 730, 1981 N.D. LEXIS 326 (N.D. 1981).
Enforcement of Restrictions.
A prerequisite to the enforceability of a restriction is that the restriction be recorded prior to the conveyance of any condominium unit; restriction adopted after the purchase of a condominium unit would not be enforceable against the purchaser except through the purchaser’s acquiescence. Breene v. Plaza Tower Ass'n, 310 N.W.2d 730, 1981 N.D. LEXIS 326 (N.D. 1981).
Condominium association had standing to intervene in a declaratory judgment action to determine what party was entitled to insurance proceeds arising out of damage done to its condominium complex roof, as it had associational standing because it was tasked with representing the interests of its members who lived in the condominium complex. Under the law governing condominiums, N.D.C.C. § 47-04.1-01 et seq., it had to record restrictions that were enforceable against any condominium unit owner, N.D.C.C. § 47-04.1-04, and it had to administer its bylaws to operate the condominium complex for the benefit of its members, N.D.C.C. § 47-04.1-07(1), which included fixing the roof for the benefit of its members. First Int'l Bank & Trust v. Peterson, 2011 ND 87, 797 N.W.2d 316, 2011 N.D. LEXIS 87 (N.D. 2011).
Restriction Defined.
In the absence of a statutory definition, supreme court held term “restrictions” to mean restrictive covenants. Breene v. Plaza Tower Ass'n, 310 N.W.2d 730, 1981 N.D. LEXIS 326 (N.D. 1981).
Waiver of Right to Notice of Restriction.
Knowledge of the provisions for amendment of the declaration of restrictions does not, without more, constitute the degree of knowledge necessary to establish a voluntary and intentional relinquishment of the statutory right to notice of a restriction prior to the purchase of a condominium unit. Breene v. Plaza Tower Ass'n, 310 N.W.2d 730, 1981 N.D. LEXIS 326 (N.D. 1981).
47-04.1-05. Reference to declaration for description of unit and common elements.
All subsequent deeds, mortgages, or other instruments may describe the individual units, the common elements, the land, or limited common elements by reference to appropriate numbers or letters as they appear on the declaration provided for in section 47-04.1-03 without repeating in detail the description of the units, common elements other than the land, or limited common elements. The reference must include the book and page of the recorded declaration.
Source:
S.L. 1965, ch. 311, § 5; 2007, ch. 396, § 1.
47-04.1-06. Incidents of a condominium grant.
Unless otherwise expressly provided for in the deeds, declaration of restrictions or plan, the incidents of a condominium grant are as follows:
- The boundaries of the unit granted are the interior surfaces of the perimeter walls, floors, ceilings, windows and doors thereof, and the units include both the portions of the building so described and the air-space so encompassed. The following except as provided above are not part of the unit: bearing walls, columns, floors, roofs, foundations, elevator equipment and shafts, central heating, central refrigeration and central air-conditioning equipment, reservoirs, tanks, pumps and other central services, pipes, ducts, flues, chutes, conduits, wires and other utility installations, whenever located, except the outlets thereof when located within the unit. In interpreting deeds and plans the existing physical boundaries of the unit or of a unit reconstructed in substantial accordance with the original plans thereof shall be conclusively presumed to be its boundaries rather than the metes and bounds expressed in the deed or plan, regardless of settling or lateral movement of the building and regardless of minor variance between boundaries shown on the plan or in the deed and those of the building.
- The common areas are owned by the owners of the units as tenants in common in proportion to each unit’s interest.
- A nonexclusive easement for ingress, egress, and support through the common area is appurtenant to and inseparable from each unit and the common areas are subject to such easements.
- Each condominium owner shall have the exclusive right to paint, repaint, tile, wax, paper, or otherwise refinish and decorate the inner surfaces of the walls, ceilings, floors, windows, and doors bounding that owner’s own unit.
- Except as provided in section 47-04.1-09, the common areas shall remain undivided, and there shall be no judicial partition thereof.
Source:
S.L. 1965, ch. 311, § 6.
Notes to Decisions
Condominium Ownership in General.
A condominium combines two distinct forms of ownership of real property: (1) exclusive ownership of an individual unit of a multi-unit condominium project, and (2) ownership as a tenant in common of the common area of the project, in proportion to each unit’s interest in the total project. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Interior Surfaces.
The interior surfaces of the perimeter walls, bearing walls, floors and ceilings of the individual units are not common areas, and unit owners are individually responsible for repairs to those areas of their unit. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Suit for Damages to Common Elements.
This chapter does not specifically authorize a condominium association to bring suit on behalf of unit owners with regard to damages to the common elements. Jablonsky v. Klemm, 377 N.W.2d 560, 1985 N.D. LEXIS 432 (N.D. 1985).
Collateral References.
Personal liability of owner of condominium unit to one sustaining personal injuries or property damage by condition of common areas, 39 A.L.R.4th 98.
47-04.1-07. Administration — Bylaws — Rules and regulations.
- The unit owners of each project shall provide for the administration of each project. The unit owners or administrative body established by the unit owners shall provide by bylaws for the maintenance of common elements, limited common elements where applicable, assessment of expenses, payment of losses, division of profits, disposition of hazard insurance proceeds, and similar matters. A true copy of such bylaws must be annexed to the declaration set forth in section 47-04.1-02 when adopted, and made a part thereof and filed in the office of the recorder. No modification of or amendment to the bylaws is valid unless set forth in an amendment to the declaration and unless the amendment is duly recorded in the office of the recorder.
-
The following provisions may not be included in the bylaws:
- Provisions that base assessment of common charges on the basis of whether the occupant of a unit is an owner, a tenant, or other person.
- Provisions that make payment of losses, division of profits, disposition of hazard proceeds, or any other topic that is within the scope of the bylaws, based on whether the occupant of a unit is an owner, a tenant, or other person.
- All bylaws, rules, and regulations as adopted by the unit owners or administrative body of the project must be reduced to writing and made available to every owner of any interest in the project.
- The unit owners shall also cause to be recorded in the office of the recorder the name of the person or persons who are responsible for the administrative duties and who may be designated as agent or agents for all owners for the service of legal process and possess such power and authority as may be provided in the bylaws.
Source:
S.L. 1965, ch. 311, § 7; 1983, ch. 500, § 1; 2001, ch. 120, § 1.
Notes to Decisions
Amendments.
Where condominium association filed a Declaration of Project, and it later amended its declaration to restrict pet ownership and where the declaration of covenants and restrictions specified that the association’s bylaws were annexed to the declaration, there was no support for plaintiff pet owner’s argument that the amendments that prohibited pet ownership were not properly adopted, or for his argument that 100 percent of the mortgage owners must have approved the amendments as it was undisputed that the by-laws allowed for amendments with approval of a two-thirds majority. Riverside Park Condos. Unit Owners Ass'n v. Lucas, 2005 ND 26, 691 N.W.2d 862, 2005 N.D. LEXIS 26 (N.D. 2005).
Subject Matter of Bylaws.
Bylaws have to relate to “maintenance of common elements, limited elements where applicable, assessment of expenses, payment of losses, division of profits, disposition of hazard insurance proceeds and similar matters”; prohibiting unit owners from leasing of a unit to nonowners is not within the scope of the subject matter of a bylaw and is, instead, governed by the provisions of section 47-04.1-04, relating to restrictions. Breene v. Plaza Tower Ass'n, 310 N.W.2d 730, 1981 N.D. LEXIS 326 (N.D. 1981).
Condominium association had standing to intervene in a declaratory judgment action to determine what party was entitled to insurance proceeds arising out of damage done to its condominium complex roof, as it had associational standing because it was tasked with representing the interests of its members who lived in the condominium complex. Under the law governing condominiums, N.D.C.C. § 47-04.1-01 et seq., it had to record restrictions that were enforceable against any condominium unit owner, N.D.C.C. § 47-04.1-04, and it had to administer its bylaws to operate the condominium complex for the benefit of its members, N.D.C.C. § 47-04.1-07(1), which included fixing the roof for the benefit of its members. First Int'l Bank & Trust v. Peterson, 2011 ND 87, 797 N.W.2d 316, 2011 N.D. LEXIS 87 (N.D. 2011).
Collateral References.
Validity and construction of condominium association’s regulations governing members’ use of common facilities, 72 A.L.R.3d 308.
Validity, construction, and application of statutes, or of condominium association’s bylaws or regulations, restricting number of units that may be owned by single individual or entity, 39 A.L.R.4th 88.
Condominium association’s liability to unit owner for injuries caused by third person’s criminal conduct, 59 A.L.R.4th 489.
Validity and construction of condominium bylaws or regulations placing special regulations, burdens, or restrictions on nonresident unit owners, 76 A.L.R.4th 295.
Validity and construction of regulations of governing body of condominium or cooperative apartment pertaining to parking, 60 A.L.R.5th 647.
47-04.1-08. Compliance with covenants, bylaws, and administrative provisions.
Each unit owner shall comply strictly with the bylaws and with the administrative rules and regulations adopted pursuant thereto, as either of the same may be lawfully amended from time to time, and with the covenants, conditions, and restrictions set forth in the declarations or in the deed to that owner’s unit. Failure to comply with such provisions shall be grounds for an action to recover sums due for damages, injunctive relief or such other relief as a court of proper jurisdiction may provide by the administrative body or in a proper case, by an aggrieved unit owner.
Source:
S.L. 1965, ch. 311, § 8.
Notes to Decisions
Amendments.
Where condominium association filed a Declaration of Project, and it later amended its declaration to restrict pet ownership and where the declaration of covenants and restrictions specified that the association’s bylaws were annexed to the declaration, there was no support for plaintiff pet owner’s argument that the amendments that prohibited pet ownership were not properly adopted, or for his argument that 100 percent of the mortgage owners must have approved the amendments as it was undisputed that the by-laws allowed for amendments with approval of a two-thirds majority. Riverside Park Condos. Unit Owners Ass'n v. Lucas, 2005 ND 26, 691 N.W.2d 862, 2005 N.D. LEXIS 26 (N.D. 2005).
Business-Judgment Rule.
The business-judgment rule applies to a board’s actions regarding repairs to the common areas of a condominium; where a challenge is made by an individual owner to an action of a condominium board, absent claims of fraud, self-dealing, unconscionability or other misconduct, the court should limit its inquiry to whether the board’s action was authorized and whether it was taken in good faith and in furtherance of the legitimate interests of the condominium. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Owner’s Right to Sue Association.
A unit owner may sue the condominium association for failure to comply with the condominium’s bylaws. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Collateral References.
Right of condominium association’s management or governing body to inspect individual units, 41 A.L.R.4th 730.
Standing to bring action relating to real property of condominium, 74 A.L.R.4th 165.
Validity and construction of regulations of governing body of condominium or cooperative apartment pertaining to parking, 60 A.L.R.5th 647.
47-04.1-09. Partition not available — Exceptions.
The provisions of chapter 32-16 relating to partition of real property shall not be available to any owner of any interest in real property included within a project established under this chapter as against any other owner or owners of any interest or interests in the same project, so as to terminate the project.
An action may be brought by one or more unit owners in a project for partition thereof by sale of the entire project, as if the owners of all of the condominiums in such project were tenants-in-common in the entire project in the same proportion as their interest in the common areas, provided, however, that a partition by sale shall be made only upon the showing that:
- Three years after damage or destruction to the project which renders a material part thereof unfit for its prior intended use, the project has not been rebuilt or repaired substantially to its state prior to its damage or destruction;
- All or a substantial and material portion of the project has been destroyed or substantially damaged, and that condominium owners holding in aggregate more than fifty percent interest in the common areas are opposed to repair or restoration of the project; or
- The project is obsolete and uneconomic, and that condominium owners holding in aggregate more than a fifty percent interest in the common areas are opposed to repair or restoration of the project.
Source:
S.L. 1965, ch. 311, § 9.
47-04.1-10. Withdrawal of property from project — Recording — Subsequent project.
Any property so constituted as a condominium project may be removed therefrom at any time, provided the sole owner or all of the owners execute, acknowledge, and record a declaration evidencing such withdrawal. If at such time there are any encumbrances or liens against any of the units, such declaration will be effective only when the creditors holding such encumbrances or liens also execute and acknowledge such declaration, or their encumbrances or liens are satisfied, or expire by operation of law.
No withdrawal of any property from a condominium project shall be a bar to any subsequent commitment to a condominium project.
Source:
S.L. 1965, ch. 311, § 10.
47-04.1-11. Liens against units for common expenses — Removal from lien — Effect of part payment.
A reasonable assessment for common expenses made by the administrative body upon any condominium and made in accordance with the recorded declaration and bylaws shall be a debt of the owner thereof at the time the assessment is made. The amount of any such assessment plus any other charges thereon, such as interest, costs, and penalties, as such may be provided for in the declarations and bylaws, shall be and become a lien upon the condominium assessed when the administrative body causes such assessment to be recorded in the office of the recorder for the county in which such condominium is located. The notice of assessment shall state the amount of such assessment and other charges and the name of the record owner thereof. Such notice shall be signed by an authorized representative of the administrative body or as otherwise provided in the declarations and bylaws. Upon payment of said assessment and charges in connection with which such notice has been so recorded, or other satisfaction thereof, the administrative body shall cause a notice to be recorded stating the satisfaction and the release of the lien thereof.
Source:
S.L. 1965, ch. 311, § 11; 2001, ch. 120, § 1.
Notes to Decisions
Bank Remedy.
Voluntariness implies choices and reasonable alternatives, and an act of necessity is not a voluntary act; thus, where a mortgage was issued in accordance with the Short-Term Mortgage Redemption Act, N.D.C.C. ch. 32-19.1, upon default, the bank’s only remedy, if any, was through foreclosure, and when the bank purchased the mortgaged property to minimize its loss, the trial court erred in determining that the bank’s purchase was voluntary, subjecting it to liability for the assessments for common expenses on unimproved lots. Century Park Condominium Ass'n v. Norwest Bank Bismarck, Nat'l Ass'n, 420 N.W.2d 349, 1988 N.D. LEXIS 49 (N.D. 1988).
Common Charges.
All unit owners are obligated to pay the common charges assessed against their unit, and the board may take prompt action to collect any common charges which remain unpaid for more than thirty days after the due date, or to foreclose the lien for common expenses. Agassiz W. Condominium Ass'n v. Solum, 527 N.W.2d 244, 1995 N.D. LEXIS 18 (N.D. 1995).
Condominiums.
Nothing in N.D.C.C. § 47-04.1-01 and this section prohibits assessments on unconstructed units for common expenses or prohibits personal liability of owners for such assessments by agreement; therefore, parties may, by agreement, provide for assessments and personal liability. Century Park Condominium Ass'n v. Norwest Bank Bismarck, Nat'l Ass'n, 420 N.W.2d 349, 1988 N.D. LEXIS 49 (N.D. 1988).
Disparity in the benefits received by owners of constructed and unconstructed condominium units supported the inference that a provision of the condominium declaration was ambiguous, creating a genuine issue of fact as to the declaration’s intent to limit liability of owners of unconstructed units for assessments. Century Park Condominium Ass'n v. Norwest Bank Bismarck, Nat'l Ass'n, 420 N.W.2d 349, 1988 N.D. LEXIS 49 (N.D. 1988).
Collateral References.
Expenses for which condominium association may assess unit owners, 77 A.L.R.3d 1290.
Personal liability of owner of condominium unit to one sustaining personal injuries or property damage by condition of common areas, 39 A.L.R.4th 98.
Liability of owner of unit in condominium, recreational development, time-share property, or the like, for assessment in support of common facilities levied against and unpaid by prior owner, 39 A.L.R.4th 114.
Validity and enforceability of condominium owner’s covenant to pay dues or fees to sports or recreational facility, 39 A.L.R.4th 129.
47-04.1-12. Other liens — Removal from — Part payment.
Subsequent to recording the declaration provided for in section 47-04.1-02 and while the property remains enrolled as a condominium project, no lien shall thereafter arise or be effective against the property. During such period liens or encumbrances shall arise or be created only against the individual units and general common elements and limited common elements where applicable, appurtenant to such unit, in the same manner and under the same conditions in every respect as liens or encumbrances may arise or be created upon or against any other separate parcel of real property subject to individual ownership.
In the event a lien against two or more units becomes effective, the owners of the separate units may remove their unit and the general common elements and limited common elements, where applicable, appurtenant to such unit from the lien by payment of the fractional or proportional amounts attributable to each of the units affected. Such individual payments shall be computed by reference to the fractions or percentages appearing on the declaration provided for in section 47-04.1-02 and bylaws annexed thereto. Subsequent to any such payment, discharge, or other satisfaction the individual unit and the general common elements and limited common elements applicable appurtenant thereto shall thereafter be free and clear of the lien so paid, satisfied, or discharged. Such partial payment, satisfaction, or discharge shall not prevent the lienor from proceeding to enforce the lienor’s rights against any unit and the general common elements and limited common elements, where applicable, appurtenant thereto not so paid, satisfied, or discharged.
Source:
S.L. 1965, ch. 311, § 12.
47-04.1-13. Real property tax and special assessments — Levy on each unit.
All real property taxes and special assessments shall be levied on each unit and its respective appurtenant fractional share or percentage of the land, general common elements and limited common elements where applicable as such units and appurtenances are separately owned, and not on the entire project.
Any exemption from taxes that may exist on real property or the ownership thereof shall not be denied by virtue of the registration of the property under the provisions of this chapter.
Source:
S.L. 1965, ch. 311, § 13.
Collateral References.
Real estate taxation of condominiums, 71 A.L.R.3d 952.
47-04.1-14. Covenant, declaration, bylaw, or other rule may not prohibit display of political signs.
Notwithstanding any provision in a covenant, declaration, bylaw, or other rule of a project, an owner or resident may not be prohibited from displaying a political yard sign on the owner’s property within sixty days before any primary, general, or special election. A covenant, declaration, bylaw, or rule may include reasonable restrictions regarding the placement and manner of display of political signs.
Source:
S.L. 2007, ch. 395, § 2.
47-04.1-15. Approval by lender of amendment.
Notwithstanding any requirement in the condominium declaration or bylaws requiring a lender’s approval of any amendment of the declaration or bylaws, after being given a thirty-day written notice beginning with the date of mailing, any lender contacted at the last-known address that does not refuse or approve of the proposed amendment is deemed to have approved the amendment. This section does not apply to any proposed amendment that affects a lender’s right to enforce the terms of the mortgage.
Source:
S.L. 2009, ch. 390, § 1.
CHAPTER 47-05 Servitudes
47-05-01. Easements attached to other lands.
The following land burdens or servitudes upon lands may be attached to other land as incidents or appurtenances and then are called easements:
- The right of pasturage.
- The right of fishing.
- The right of way.
- The right of taking water, wood, minerals, and other things.
- The right of transacting business upon land.
- The right of conducting lawful sports upon land.
- The right of receiving air, light, or heat from or over, or discharging the same upon or over land.
- The right of receiving water from or discharging the same upon land.
- The right of flooding land.
- The right of having water flow without diminution or disturbance of any kind.
- The right of using a wall as a party wall.
- The right of receiving more than natural support from adjacent land or things affixed thereto.
- The right of having the whole of a division fence maintained by a coterminous owner.
- The right of having public conveyances stopped or of stopping the same on land.
- The right of a seat in church.
- The right of burial.
Source:
Civ. C. 1877, § 244; R.C. 1895, § 3351; R.C. 1899, § 3351; R.C. 1905, § 4787; C.L. 1913, § 5330; R.C. 1943, § 47-0501; S.L. 2009, ch. 391, § 1.
Derivation:
Cal. Civ. C., 801.
Cross-References.
Transfer of realty passes all easements attached thereto, see N.D.C.C. § 47-10-11.
Notes to Decisions
- “Easement” Defined.
- Enumerated Easements Not Exclusive.
- Federal Easement for Waterfowl Production.
- Mineral Lessee.
- Watercourses.
“Easement” Defined.
An easement is a charge or burden upon one estate, the servient, for the benefit of another, the dominant. Johnson v. Armour & Co., 69 N.D. 769, 291 N.W. 113, 1940 N.D. LEXIS 206 (N.D. 1940).
Enumerated Easements Not Exclusive.
The enumerated easements in this statute are not exclusive and an easement can be granted to the public for park purposes or for use as public grounds by dedication at common law. Cole v. Minnesota Loan & Trust Co., 17 N.D. 409, 117 N.W. 354, 1908 N.D. LEXIS 68 (N.D. 1908).
Federal Easement for Waterfowl Production.
Property interest conveyed to United States for the purpose of waterfowl production in the prairie pothole area, restricting the owner from changing the natural contour or drainage of his land, whether or not a valid easement under North Dakota law, is a valid conveyance under federal law, and vested in the United States the rights stated therein. United States v. Albrecht, 496 F.2d 906, 1974 U.S. App. LEXIS 8747 (8th Cir. N.D. 1974).
Mineral Lessee.
Lessee under a mineral lease acquires an easement in surface estate for purpose of developing its mineral interest. Slaaten v. Cliff's Drilling Co., 748 F.2d 1275, 1984 U.S. App. LEXIS 16355 (8th Cir. N.D. 1984).
Watercourses.
Where a lower riparian owner conveys to the upper riparian owner the right to discharge waste, sewage and refuse into the stream, and agrees to permit the same to be carried off by the flow of the stream through the premises of the lower riparian owner, the agreement creates an easement on the land of the lower riparian owner. Johnson v. Armour & Co., 69 N.D. 769, 291 N.W. 113, 1940 N.D. LEXIS 206 (N.D. 1940).
Collateral References.
Electric line, correlative rights of dominant and servient owners in right of way for, 6 A.L.R.2d 205.
Misuse, abandonment, waiver or forfeiture of easement on ground of, 16 A.L.R.2d 609.
Persons entitled to use right of way created by express grant, effect of provisions designating or referring to, 20 A.L.R.2d 796.
Tenant: easements or privileges of tenant of part of building as to other parts not included in lease, 24 A.L.R.2d 123.
Party wall, right to increase height of, 24 A.L.R.2d 1053.
Party walls, loss by nonuser of private easement as to, 25 A.L.R.2d 1265, 1320.
Liens: easement, servitude or restrictive covenant as affected by enforcement of assessment or improvement liens, 26 A.L.R.2d 873.
Pipeline: correlative rights of dominant and servient owners in right of way for, 28 A.L.R.2d 626.
Conveyance of land as bounded by road, street, or other way as giving grantee rights in or to such way, 46 A.L.R.2d 461, 490.
Foreclosure of mortgage or trust deed as affecting easement claimed in, over or under property, 46 A.L.R.2d 1197.
Hunting and fishing: right created by private grant or reservation of right to hunt or fish on another’s land, 49 A.L.R.2d 1395.
Easement by prescription in artificial drains, pipes, or sewers, 55 A.L.R.2d 1144.
Dedication: right of owner of servient tenement subject to right of way to dedicate his land, 69 A.L.R.2d 1236.
Relocation of easements (other than those originally arising by necessity); rights as between private parties, 80 A.L.R.2d 743.
Extent and reasonableness of use of private way in exercise of easement granted in general terms, 3 A.L.R.3d 1256.
Expenses: right of servient owner to maintain, improve or repair easement of way at expense of dominant owner, 20 A.L.R.3d 1026.
Gate or fence, right to maintain across right of way, 52 A.L.R.3d 9.
Locating easement of way created by necessity, 36 A.L.R.4th 769.
Scope of prescriptive easement for access (easement of way), 79 A.L.R.4th 604.
Loss of private easement by nonuse, 62 A.L.R.5th 219.
47-05-01.1. Solar easement — Creation.
Any easement obtained for the purpose of exposure of a solar energy device to the direct rays of the sun shall be created in writing and shall be subject to the same conveyancing and instrument recording requirements as other easements. The term “solar energy device” means the device, mechanism, or apparatus designed to receive the direct rays of the sun and convert those rays into heat, electrical, or other form of energy for the purpose of providing heating, cooling, or electrical power.
Source:
S.L. 1977, ch. 425, §§ 1, 3.
47-05-01.2. Solar easement — Contents.
Any instrument creating a solar easement shall include, but shall not be limited to, all of the following:
- The vertical and horizontal angles, expressed in degrees, at which the solar easement extends over the real property subject to the solar easement.
- Any terms, conditions, or both under which the solar easement is granted or will be terminated.
- Any provisions for compensation of the owner of the property benefiting from the solar easement in the event of interference with the enjoyment of the solar easement or compensation of the owner of the property subject to the solar easement for maintaining the solar easement.
Source:
S.L. 1977, ch. 425, § 2.
47-05-02. Servitudes not attached to land.
The following land burdens or servitudes upon land may be granted and held, though not attached to land:
- The right to pasture, and of fishing.
- The right of a seat in church.
- The right of burial.
- The right of taking rents and tolls.
- The right of way.
- The right of taking water, wood, minerals, or other things.
- A historic easement granted with respect to a state historic site and buildings and structures thereon, or property listed in the national register of historic places, in accordance with the provisions of section 55-10-08.
Source:
Civ. C. 1877, § 245; R.C. 1895, § 3352; R.C. 1899, § 3352; R.C. 1905, § 4788; C.L. 1913, § 5331; R.C. 1943, § 47-0502; S.L. 1983, ch. 589, § 2; 2009, ch. 391, § 2.
Derivation:
Cal. Civ. C., 802.
Notes to Decisions
Executory Land Contract.
The vendee under an executory land contract obtains at law no real property nor interest in real property. The purchaser becomes the beneficial owner in equity, and the vendor retains legal title in trust for such vendee. Sox v. Miracle, 35 N.D. 458, 160 N.W. 716, 1916 N.D. LEXIS 174 (N.D. 1916).
47-05-02.1. Requirements of easements, servitudes, or nonappurtenant restrictions on the use of real property.
Real property easements, servitudes, or any nonappurtenant restrictions on the use of real property, which become binding after July 1, 1977, shall be subject to the requirements of this section. These requirements are deemed a part of any agreement for such interests in real property whether or not printed in a document of agreement.
- The area of land covered by the easement, servitude, or nonappurtenant restriction on the use of real property shall be properly described and shall set out the area of land covered by the interest in real property.
- The duration of the easement, servitude, or nonappurtenant restriction on the use of real property must be specifically set out, and in no case may the duration of any interest in real property regulated by this section exceed ninety-nine years. The duration of an easement for a waterfowl production area acquired by the federal government, and consented to by the governor or the appropriate state agency after July 1, 1985, may not exceed fifty years. A waterfowl production area easement that exceeds fifty years or which purports to be perpetual may be extended by negotiation between the owner of the easement and the owner of the serviant tenement. A waterfowl production area easement that exceeds fifty years or which purports to be permanent and is not extended by negotiation is void. The duration of a wetlands reserve program easement acquired by the federal government pursuant to the Food, Agriculture, Conservation, and Trade Act of 1990 after July 1, 1991, may not exceed thirty years.
- No increase in the area of real property subject to the easement, servitude, or nonappurtenant restriction shall be made except by negotiation between the owner of the easement, servitude, or nonappurtenant restriction and the owner of the servient tenement.
Source:
S.L. 1977, ch. 426, § 1; 1985, ch. 275, § 2; 1991, ch. 485, § 1; 2013, ch. 345, § 1.
Effective Date.
The 2013 amendment of this section by section 1 of chapter 345, S.L. 2013 becomes effective June 30, 2017.
Notes to Decisions
- Application.
- Deed Language.
- Railroads.
- Trespass.
- Waterfowl Production Areas.
- Wetlands Easements Acquired by United States.
Application.
Summary judgment was properly entered against appellant in a case alleging trespass and other causes of action because a 1953 permit issued to another constituted an easement, rather than a license, since it was not revocable at the will of a landowner; under N.D.C.C. § 47-10-11, a transfer of real property passed all easements, but a license was generally not assignable. Moreover, N.D.C.C. § 47-05-02.1(1) only applied to easements that became binding after July 1, 1977. Riverwood Commer. Park, LLC v. Std. Oil Co., 2011 ND 95, 797 N.W.2d 770, 2011 N.D. LEXIS 95 (N.D. 2011).
Deed Language.
Warranty deed did not create or reserve an express roadway easement by using the words “subject to” because they connoted a limitation on a grantor’s warranty, and not a reservation of rights. The evidence permitted an inference that a dirt trail was in existence before the warranty deed at issue was executed and that the grantor intended to limit the warranty because of the possible existence of an implied easement. Wagner v. Crossland Constr. Co., 2013 ND 219, 2013 N.D. LEXIS 223 (N.D. 2013).
Railroads.
Order holding that a railroad company had a valid easement on an owner’s property was upheld where the easement was properly described under N.D.C.C. § 47-05-02.1(1); the railroad tracks were in place when the owner obtained the property well over a decade ago and remained in place. Burlington Northern R.R. v. Fail, 2008 ND 114, 751 N.W.2d 188, 2008 N.D. LEXIS 115 (N.D. 2008).
Trespass.
April 2007 pipeline easement was ambiguous, and the district court erred in construing the easement as a matter of law. However, the district court did not err in ruling that an energy company's use of plaintiff's private road to access a second pipeline on plaintiffs' land was not authorized by a 2008 road use agreement and was a trespass. Krenz v. XTO Energy, Inc., 2017 ND 19, 890 N.W.2d 222, 2017 N.D. LEXIS 32 (N.D. 2017).
Waterfowl Production Areas.
To the extent this section’s limitation on the duration of easements encumbers the federal government’s acquisition of waterfowl production areas under the Migratory Bird Hunting and Conservation Stamp Act, 16 USCS § 718 et seq., it is invalid. United States v. North Dakota, 650 F.2d 911, 1981 U.S. App. LEXIS 12659 (8th Cir. N.D. 1981), aff'd, 460 U.S. 300, 103 S. Ct. 1095, 75 L. Ed. 2d 77, 1983 U.S. LEXIS 23 (U.S. 1983).
Wetlands Easements Acquired by United States.
This section, which limits nonappurtenant easements to a maximum term of 99 years, may not be applied to wetlands easements acquired by the United States under consents previously given pursuant to the Stamp Act, 16 USCS § 718 et seq. North Dakota v. United States, 460 U.S. 300, 103 S. Ct. 1095, 75 L. Ed. 2d 77, 1983 U.S. LEXIS 23 (U.S. 1983).
Law Reviews.
Waterfowl Production Areas: A State Perspective, 60 N.D. L. Rev. 659 (1984).
Article: Limitations on Easements In North Dakota May Have Unintended Consequences for Qualified Conservation Easement Charitable Contributions, 87 N.D. L. Rev. 343 (2011).
47-05-03. Dominant tenement defined.
A dominant tenement means the land to which an easement is attached.
Source:
Civ. C. 1877, § 246; R.C. 1895, § 3353; R.C. 1899, § 3353; R.C. 1905, § 4789; C.L. 1913, § 5332; R.C. 1943, § 47-0503.
Derivation:
Cal. Civ. C., 803.
47-05-04. Servient tenement defined.
A servient tenement means the land upon which a burden or servitude has been placed.
Source:
Civ. C. 1877, § 246; R.C. 1895, § 3353; R.C. 1899, § 3353; R.C. 1905, § 4789; C.L. 1913, § 5332; R.C. 1943, § 47-0504.
Derivation:
Cal. Civ. C., 803.
47-05-05. Servitude — Creation.
A servitude can be created only by one who has a vested estate in the servient tenement.
Source:
Civ. C. 1877, § 247; R.C. 1895, § 3354; R.C. 1899, § 3354; R.C. 1905, § 4790; C.L. 1913, § 5333; R.C. 1943, § 47-0505.
Derivation:
Cal. Civ. C., 894.
Collateral References.
Executor’s power to create easements, 44 A.L.R.2d 573.
47-05-06. Holding of servitude.
A servitude thereon cannot be held by the owner of the servient tenement.
Source:
Civ. C. 1877, § 248; R.C. 1895, § 3355; R.C. 1899, § 3355; R.C. 1905, § 4791; C.L. 1913, § 5334; R.C. 1943, § 47-0506.
Derivation:
Cal. Civ. C., 805.
Notes to Decisions
Implied Easements.
Plaintiffs failed to sustain their burden of proving an implied easement to their property, because the principles of implied easement are applicable between the original owners and their immediate grantees, and plaintiffs’ immediate grantees lacked knowledge of plaintiffs’ use at the time they bought the property from the plaintiffs. Lutz v. Krauter, 553 N.W.2d 749, 1996 N.D. LEXIS 211 (N.D. 1996).
Ownership by One Spouse.
This section applies where a spouse who is the sole owner of the servient tenement attempts to convey an easement over the servient tenement to both spouses as owners of the dominant tenement. Lutz v. Krauter, 553 N.W.2d 749, 1996 N.D. LEXIS 211 (N.D. 1996).
47-05-07. Servitude — Extent.
The extent of a servitude is determined by the terms of the grant or the nature of the enjoyment by which it was acquired.
Source:
Civ. C. 1877, § 249; R.C. 1895, § 3356; R.C. 1899, § 3356; R.C. 1905, § 4792; C.L. 1913, § 5335; R.C. 1943, § 47-0507.
Derivation:
Cal. Civ. C., 806.
Notes to Decisions
Extent of Easement.
If an easement over a neighboring lot is ultimately found to be necessary, the landowner is not automatically entitled to access giving him the “best” use of his land; rather, the scope of the easement granted depends not only on necessity, but also on whether it is consistent with the full reasonable enjoyment of the servient estate (i.e., the neighboring lot). Griffeth v. Eid, 1998 ND 38, 573 N.W.2d 829, 1998 N.D. LEXIS 30 (N.D. 1998).
Present use of a lane that was built on plaintiffs' property was consistent with the scope of an easement granted for highway purposes. Evidence supported that the lane was constructed to alleviate safety concerns because of congestion due to trucks waiting on the highway to access an oil-truck offloading facility. Ceynar v. Tesoro Logistics LP, 2017 ND 112, 894 N.W.2d 374, 2017 N.D. LEXIS 111 (N.D. 2017).
Question of Fact.
The determination of whether a particular use of an easement is reasonable is a question of fact. The supreme court’s review thereof is therefore limited to a determination of whether the finding is clearly erroneous. Radspinner v. Charlesworth, 369 N.W.2d 109, 1985 N.D. LEXIS 332 (N.D. 1985).
Reference to Grant.
Extent of an express easement must be determined by the terms of the grant; however, it may be necessary for the court to look at custom and usage to determine what was meant by the general terms used in the grant at the time it was executed. Minnkota Power Coop. v. Lake Shure Properties, 295 N.W.2d 122, 1980 N.D. LEXIS 278 (N.D. 1980).
Collateral References.
Reasonableness of use: extent and reasonableness of use of private way in exercise of easement granted in general terms, 3 A.L.R.3d 1256.
Scope of prescriptive easement for access (easement of way), 79 A.L.R.4th 604.
47-05-08. Partition of dominant tenement — Burden apportioned — Limitations.
In case of partition of the dominant tenement, the burden must be apportioned according to the division of the dominant tenement, but not in such a way as to increase the burden upon the servient tenement.
Source:
Civ. C. 1877, § 250; R.C. 1895, § 3357; R.C. 1899, § 3357; R.C. 1905, § 4793; C.L. 1913, § 5336; R.C. 1943, § 47-0508.
Derivation:
Cal. Civ. C., 807.
Collateral References.
Grant of part of cotenancy land, taken from less than all cotenants, as subject of protection through partition, 77 A.L.R.2d 1376.
Right of owners of parcels into which dominant tenement is or will be divided to use right of way, 10 A.L.R.3d 960.
47-05-09. Right of future owner in easements.
The owner of a future estate in a dominant tenement may use easements attached thereto for the purpose of viewing waste, demanding rent, or removing an obstruction to the enjoyment of such easement, although such tenement is occupied by a tenant.
Source:
Civ. C. 1877, § 251; R.C. 1895, § 3358; R.C. 1899, § 3358; R.C. 1905, § 4794; C.L. 1913, § 5337; R.C. 1943, § 47-0509.
Derivation:
Cal. Civ. C., 808.
47-05-10. Enforcement of easement — Right of action.
The owner of any estate in a dominant tenement, or the occupant of such tenement, may maintain an action for the enforcement of an easement attached thereto.
Source:
Civ. C. 1877, § 252; R.C. 1895, § 3359; R.C. 1899, § 3359; R.C. 1905, § 4795; C.L. 1913, § 5338; R.C. 1943, § 47-0510.
Derivation:
Cal. Civ. C., 809.
Collateral References.
Remedy of tenant against stranger for obstruction of easement, 12 A.L.R.2d 1192, 1210.
Necessary parties defendant to suit to prevent or remove obstruction or interference with easement of way, 28 A.L.R.2d 409.
47-05-11. Public servitude — Effect on owner of fee — Action for possession.
The owner in fee of a servient tenement may maintain an action for the possession of the land against anyone unlawfully possessed thereof, though a servitude exists thereon in favor of the public.
Source:
Civ. C. 1877, § 253; R.C. 1895, § 3360; R.C. 1899, § 3360; R.C. 1905, § 4796; C.L. 1913, § 5339; R.C. 1943, § 47-0511.
Derivation:
Cal. Civ. C., 810.
Notes to Decisions
Ejectment.
An original owner, or those claiming under him, of land dedicated to a public use may maintain ejectment against a permanent encumbrancer or occupier inconsistent with or repugnant to the purpose of the dedication or grant. Northern Pac. Ry. v. Lake, 10 N.D. 541, 88 N.W. 461, 1901 N.D. LEXIS 73 (N.D. 1901).
47-05-12. Extinguishment of servitude — Methods.
A servitude is extinguished:
- By vesting of the right to the servitude and the right to the servient tenement in the same person;
- By the destruction of the servient tenement;
- By the performance of any act upon either tenement by the owner of the servitude or with the owner’s assent if it is incompatible with its nature or exercise; or
- When the servitude was acquired by enjoyment, by disuse thereof by the owner of the servitude for the period prescribed for acquiring title by prescription.
Source:
Civ. C. 1877, § 254; R.C. 1895, § 3361; R.C. 1899, § 3361; R.C. 1905, § 4797; C.L. 1913, § 5340; R.C. 1943, § 47-0512.
Derivation:
Cal. Civ. C., 811.
Cross-References.
Maximum duration of temporary easements acquired by public agencies, see N.D.C.C. § 47-01-22.
Notes to Decisions
Abandonment.
Abandonment of an easement resting in an express grant must be established by clear and unequivocal evidence of decisive and conclusive acts. Harry E. McHugh, Inc. v. Haley, 61 N.D. 359, 237 N.W. 835, 1931 N.D. LEXIS 284 (N.D. 1931).
Nonuser.
A servitude resting in an express grant is not extinguished by a nonuser. Harry E. McHugh, Inc. v. Haley, 61 N.D. 359, 237 N.W. 835, 1931 N.D. LEXIS 284 (N.D. 1931); Royse v. Easter Seal Soc'y for Crippled Children & Adults, 256 N.W.2d 542, 1977 N.D. LEXIS 147 (N.D. 1977).
Where a highway within the limits of an incorporated city has been established by prescription, nonuser for the period prescribed for establishing a highway by prescription will vacate the highway. Casey v. Corwin, 71 N.W.2d 553, 1955 N.D. LEXIS 122 (N.D. 1955).
Ownership by One Spouse.
No easement was created where the spouse who was the sole owner of the servient tenement attempted to convey an easement over the servient tenement to both spouses as owners of the dominant tenement. Lutz v. Krauter, 553 N.W.2d 749, 1996 N.D. LEXIS 211 (N.D. 1996).
Collateral References.
Easement or servitude as affected by enforcement of assessment or improvement liens, 26 A.L.R.2d 873.
Loss of rights in way acquired by grantee under conveyance of land as bounded by road, street, or other way, 46 A.L.R.2d 461, 490.
Foreclosure of mortgage or trust deed as affecting easement claimed in, over, or under property, 46 A.L.R.2d 1197.
Loss of private easement by nonuse, 62 A.L.R.5th 219.
What constitutes, and remedies for, misuse of easement, 111 A.L.R.5th 313.
47-05-13. Restrictions on easements for forest purposes.
Notwithstanding any other provision of law, a person may not create, convey, or record any easement, servitude, or nonappurtenant restriction on the use of real property within thirty-three feet [10.06 meters] of the centerline of any section line if the purpose of that easement, servitude, or restriction is to retain or protect forests.
Source:
S.L. 1995, ch. 436, § 1.
47-05-14. Wind easement — Definition. [Renumbered]
Redesignated as section 17-04-02 under S.L. 2007, ch. 204, § 5.
Note.
This section has been redesignated as section 17-04-02 pursuant to S.L. 2007, ch. 204, § 5.
47-05-15. Wind easements — Creation — Term — Development required. [Renumbered]
Redesignated as section 17-04-03 under S.L. 2007, ch. 204, § 5.
Note.
This section has been redesignated as section 17-04-03 pursuant to S.L. 2007, ch. 204, § 5.
47-05-16. Severance of wind energy rights limited. [Renumbered]
Redesignated as section 17-04-04 under S.L. 2007, ch. 204, § 5.
Note.
This section has been redesignated as section 17-04-04 pursuant to S.L. 2007, ch. 204, § 5.
47-05-17. Severance of the right of access for hunting access prohibited.
The right of access to land to shoot, shoot at, pursue, take, attempt to take, or kill any game animals or game birds; search for or attempt to locate or flush any game animals and game birds; lure, call, or attempt to attract game animals or game birds; hide for the purpose of taking or attempting to take game animals or game birds; and walk, crawl, or advance toward wildlife while possessing implements or equipment useful in the taking of game animals or game birds may not be severed from the surface estate. This section does not apply to deeds, instruments, or interests in property recorded or executed before August 1, 2007.
Source:
S.L. 2007, ch. 398, § 1; 2009, ch. 391, § 3; 2021, ch. 333, § 1, eff August 1, 2021.
Notes to Decisions
Compliance.
Dismissal of a grantor’s complaint seeking reformation of a deed was appropriate because a reservation in the deed expressly providing the grantor with the right to hunt on any or all the premises was a severance of hunting rights from the surface rights that was prohibited. Hauer v. Zerr, 2020 ND 16, 937 N.W.2d 508, 2020 N.D. LEXIS 17 (N.D. 2020).
CHAPTER 47-06 Real Estate Title by Occupancy and Accession
47-06-01. Title by occupancy.
Occupancy for any period confers a title sufficient against all except the state and those who have title by prescription, accession, transfer, will, or succession.
Source:
Civ. C. 1877, § 581; R.C. 1895, § 3490; R.C. 1899, § 3490; R.C. 1905, § 4926; C.L. 1913, § 5469; R.C. 1943, § 47-0601.
Derivation:
Cal. Civ. C., 1006.
Cross-References.
Damages for willful detention of realty, see N.D.C.C. § 32-03-22.
Damages for wrongful occupation of realty, see N.D.C.C. § 32-03-21.
Notes to Decisions
Easement over Railroad Bed.
Where a railroad crossing is put in and used permissively, no right to an easement over the railroad bed is acquired. Lincoln v. Great N. Ry., 26 N.D. 504, 144 N.W. 713 (N.D. 1913).
Holder by Transfer.
Occupancy for a period short of the statutory limitations does not confer title against the holder of a title by transfer. Goss v. Herman, 20 N.D. 295, 127 N.W. 78, 1910 N.D. LEXIS 84 (N.D. 1910).
Collateral References.
Extinguishment by prescription of natural servitude for drainage of surface waters, 42 A.L.R.4th 462.
47-06-02. Title by prescription — Occupancy required.
Occupancy for the period prescribed by any law of this state as sufficient to bar an action for the recovery of the property confers a title thereto, denominated a title by prescription, which is sufficient against all.
Source:
Civ. C. 1877, § 582; R.C. 1895, § 3491; R.C. 1899, § 3491; R.C. 1905, § 4927; C.L. 1913, § 5470; R.C. 1943, § 47-0602.
Derivation:
Cal. Civ. C., 1007.
Cross-References.
Actions for recovery or possession of realty, statute of limitations on, see N.D.C.C. § 28-01-04.
Disabilities extending limitations on actions affecting realty, see N.D.C.C. § 28-01-14.
Presumption against adverse possession of real estate, see N.D.C.C. § 28-01-07.
Notes to Decisions
Partial Occupation of Tract.
Where there has been an entry upon land under color of title by deed, although the actual settlement and improvements are on only a small portion of the tract, yet, if no one possesses the rest of the tract, the law presumes the entry to be coextensive with the grant. Smith v. Gale, 144 U.S. 509, 12 S. Ct. 674, 36 L. Ed. 521 (1892), aff’g Gale v. Shillock, 4 Dakota 182, 29 N.W. 661 (1886), and Gale v. Shillock, 30 N.W. 138, 4 Dakota 196 (1886).
Pollution of Stream.
A city does not obtain a prescriptive right to pollute the waters of a river by emptying sewage therein for less than twenty years. Conlon v. City of Dickinson, 72 N.D. 190, 5 N.W.2d 411, 1942 N.D. LEXIS 130 (N.D. 1942).
Relation Back.
Title by prescription relates back to the inception of the use. Conlin v. Metzger, 77 N.D. 620, 44 N.W.2d 617, 1950 N.D. LEXIS 157 (N.D. 1950).
Collateral References.
Extinguishment by prescription of natural servitude for drainage of surface waters, 42 A.L.R.4th 462.
47-06-03. Title to real property — Adverse possession.
A title to real property, vested in any person who has been or hereafter shall be, either alone or including those under whom that person claims, in the actual open adverse and undisputed possession of the land under such title for a period of ten years and who, either alone or including those under whom that person claims, shall have paid all taxes and assessments legally levied thereon, shall be valid in law. Possession by a county under tax deed shall not be deemed adverse. A contract for deed shall constitute color of title within the meaning of this section from and after the execution of such contract.
Source:
S.L. 1899, ch. 158, § 1; R.C. 1899, § 3491a; R.C. 1905, § 4928; C.L. 1913, § 5471; R.C. 1943, § 47-0603; S.L. 1951, ch. 276, § 1; 1953, ch. 275, §§ 1, 2; 1957 Supp., § 47-0603.
Cross-References.
Limitations of actions, see N.D.C.C. ch. 28-01.
Notes to Decisions
- Constitutionality.
- Ancestor’s Possession Not Adverse to Heir.
- Breach of Warranty.
- Burden of Proof.
- Color of Title.
- Construction of Cabins.
- Cotenants.
- Evidence Sufficient.
- Knowledge.
- Length of Possession.
- Mineral Estates.
- Minor, Adverse Possession Against.
- Municipal Alley.
- Municipal Streets.
- Question of Fact.
- Tacking Possessions.
- Taxes.
- What Constitutes Adverse Possession.
Constitutionality.
The statute is retrospective but is not unconstitutional for that reason under the due process clause as against one who had an opportunity after its passage to assert a claim to the land or pay the taxes thereon before his title was extinguished. Schauble v. Schulz, 137 F. 389, 69 C.C.A. 581 (8th Cir. 1905).
Ancestor’s Possession Not Adverse to Heir.
Where land was held in joint tenancy by husband and wife and husband’s will made ineffective attempt to give wife a life estate with remainder to his children by a previous marriage, wife’s possession of the property after husband’s death and brief possession by his children thereafter did not pass title to children by adverse possession since wife’s possession was not hostile to interests of her sisters who were her heirs as well as her residuary devisees, there being no reason for sisters to believe that she was other than fee owner. Cranston v. Winters, 238 N.W.2d 647, 1976 N.D. LEXIS 192 (N.D. 1976).
Breach of Warranty.
Since the only “title” instrument under which a partnership could make an adverse possession claim under this provision was the unrecorded purchase memorandum it received from the defendant, and its ownership claim was therefore “by, through, or under” the defendant, its adverse possession claim against the adjacent lot’s owner constituted a breach of the defendant’s special warranty against claims against title by, under, or through himself, and provided the legal basis for an award of damages to the adjacent lot’s owner. State Bank & Trust v. Brekke, 1999 ND 212, 602 N.W.2d 681, 1999 N.D. LEXIS 230 (N.D. 1999).
Burden of Proof.
The person claiming property by adverse possession by virtue of a title has the burden to prove that he, either alone or including those under whom he claims, has been in actual open adverse and undisputed possession for a period of ten years and that he, either alone or including those under whom he claims, has paid all taxes and assessments legally levied thereon for such period. Simons v. Tancre, 321 N.W.2d 495, 1982 N.D. LEXIS 286 (N.D. 1982).
The burden of proving adverse possession rests with the person alleging it and must be established by clear and convincing evidence. Benson v. Taralseth, 382 N.W.2d 649, 1986 N.D. LEXIS 265 (N.D. 1986).
Quieting title to property in favor of property owners and dismissal of a neighbor's claim for adverse possession was appropriate because the neighbor failed to establish by clear and convincing evidence that the neighbor, or the neighbor's predecessors-in-interest, had actual, visible, and continuous possession of the disputed property for the required period of time. Moody v. Sundley, 2015 ND 204, 868 N.W.2d 491, 2015 N.D. LEXIS 218 (N.D. 2015).
Color of Title.
A tax deed constitutes color of title even if the tax upon which it was issued was void by reason of irregularities in the tax proceedings. Power v. Kitching, 10 N.D. 254, 86 N.W. 737, 1901 N.D. LEXIS 31 (N.D. 1901).
Tax deed valid on its face constitutes color of title. Stiles v. Granger, 17 N.D. 502, 117 N.W. 777, 1908 N.D. LEXIS 78 (N.D. 1908); McGee v. Stokes' Heirs at Law, 76 N.W.2d 145, 1956 N.D. LEXIS 110 (N.D. 1956).
Possession of land under a parol gift, accompanied by the delivery of a patent evidencing the donor’s title, does not constitute color of title which will enable the donee to obtain the protection of the ten-year statute of limitations. Urbanec v. Urbanec, 43 N.D. 127, 174 N.W. 880, 1919 N.D. LEXIS 35 (N.D. 1919).
A tax deed issued by the county auditor, although void on its face, is sufficient to confer on the grantee color of title which will support actual adverse possession. Grandin v. Gardiner, 63 N.W.2d 128, 1954 N.D. LEXIS 66 (N.D. 1954).
A decree of heirship which designates the heirs entitled to certain realty is color of title even if the proceedings on which it is based are subsequently determined to be invalid. Chapin v. Letcher, 93 N.W.2d 415, 1958 N.D. LEXIS 101 (N.D. 1958).
A tax deed constitutes color of title sufficient to support a title acquired under this section as against a royalty interest severed from the land after attachment of the tax lien but before issuance of the tax deed. Payne v. A. M. Fruh Co., 98 N.W.2d 27, 1959 N.D. LEXIS 96 (N.D. 1959).
Adverse claimant who did not possess any deeds and did not prove payment of taxes on any of property claimed failed to satisfy burden of proving color of title. Martin v. Rippel, 152 N.W.2d 332, 1967 N.D. LEXIS 82 (N.D. 1967).
Where plaintiff’s successor in interest purchased the property as a successor in interest to the former owners at a special repurchase proceeding provided for by section 19, Chapter 286, S.L. 1941, and not as an innocent purchaser at a regular tax sale, and where the special warranty deed given pursuant to the repurchase proceeding reserved the mineral estate to the grantors and was part of the record chain of title, plaintiff and her successor in interest did not possess the mineral estate under color of title and her possession of the surface estate did not constitute possession of the mineral estate sufficient for adverse possession. Sickler v. Pope, 326 N.W.2d 86, 1982 N.D. LEXIS 376 (N.D. 1982).
Where neither party challenged the determination by the trial court that the defendant acquired title to encroached property by adversely possessing it under color of title for ten years, the defendant partnership owned the entire building and land upon which it was situated by open and notorious possession. State Bank & Trust v. Brekke, 1999 ND 212, 602 N.W.2d 681, 1999 N.D. LEXIS 230 (N.D. 1999).
Construction of Cabins.
The construction of cabins held to constitute conduct so directly hostile and unmistakably clear as to satisfy the necessary requirements for adverse possession. Benson v. Taralseth, 382 N.W.2d 649, 1986 N.D. LEXIS 265 (N.D. 1986).
Cotenants.
Mere possession itself and the payment of taxes by a tenant in common is presumed to be for the benefit of all tenants in common, and the appropriation of rents and profits will not constitute adverse possession on the part of a tenant in common. Simons v. Tancre, 321 N.W.2d 495, 1982 N.D. LEXIS 286 (N.D. 1982).
A cotenant may hold adversely to other cotenants if his possession is such that it meets the requirements of the law of adverse possession; while one cotenant may oust another, it must be by acts so distinctly hostile to the rights of the other cotenants that the intent to dispossess is clear and unmistakable. Simons v. Tancre, 321 N.W.2d 495, 1982 N.D. LEXIS 286 (N.D. 1982).
Cotenant’s recording of oil and gas leases in which he was the only lessor, an affidavit stating that he was the sole and only owner, and a contract for deed for the entire property in which he was the only grantor constituted only constructive notice of his ouster of the other cotenants and was not sufficient notice to establish a hostile ouster for purposes of establishing title by adverse possession against his other cotenants. Nelson v. Christianson, 343 N.W.2d 375, 1984 N.D. LEXIS 237 (N.D. 1984).
Evidence Sufficient.
Trial court did not err in finding plaintiff acquired title to property through executed parol gift from his parents, and occupancy by adverse possession. Mertz v. Arendt, 1997 ND 113, 564 N.W.2d 294, 1997 N.D. LEXIS 106 (N.D. 1997).
Knowledge.
Actual knowledge of the adverse possession is not necessary if there is a course of conduct directly hostile and these acts of hostility are unmistakably clear. Benson v. Taralseth, 382 N.W.2d 649, 1986 N.D. LEXIS 265 (N.D. 1986).
The defendant’s knowledge and conduct regarding the encroachment of property was not relevant to his partnership’s ownership by adverse possession where neither party challenged the trial court’s determination that the partnership owned the encroached property by adverse possession, and provided no equitable basis for an award of damages to the owner of the adjacent lot for its loss of property. State Bank & Trust v. Brekke, 1999 ND 212, 602 N.W.2d 681, 1999 N.D. LEXIS 230 (N.D. 1999).
Length of Possession.
The doctrine of tacking possession is not applicable under this statute. J. B. Streeter, Jr., Co. v. Fredrickson, 11 N.D. 300, 91 N.W. 692, 1902 N.D. LEXIS 216 (N.D. 1902); McGee v. Stokes' Heirs at Law, 76 N.W.2d 145, 1956 N.D. LEXIS 110 (N.D. 1956).
Title to real property in this state may be acquired by the adverse, open, and exclusive undisputed possession thereof for a period of ten years under claim of title and by paying all taxes assessed against the land for such period. Woolfolk v. Albrecht, 22 N.D. 36, 133 N.W. 310, 1911 N.D. LEXIS 43 (N.D. 1911); Wright v. Jones, 23 N.D. 191, 135 N.W. 1120, 1912 N.D. LEXIS 81 (N.D. 1912).
Legal owners of property invalidly held under void tax deed were not guilty of laches because they failed to assert invalidity until eight years after date of tax from county. Strom v. Giske, 68 N.W.2d 838, 1954 N.D. LEXIS 120, 1955 N.D. LEXIS 94 (N.D. 1954).
The ten-year period is to be reckoned from the time that the adverse possession begins, and not from the time the first payment of taxes is made. Tarnovsky v. Security State Bank, 77 N.W.2d 828, 1956 N.D. LEXIS 131 (N.D. 1956); Schauble v. Schulz, 137 F. 389, 69 C.C.A. 581 (8th Cir. 1905).
One who has been in actual, open, adverse, and undisputed possession of land under color of title for a period of ten years and has paid all taxes and assessments legally levied thereon has a valid title thereto. Anderson v. Shelton, 92 N.W.2d 166, 1958 N.D. LEXIS 89 (N.D. 1958); Severson v. Simon, 110 N.W.2d 289, 1961 N.D. LEXIS 84 (N.D. 1961).
One who is in adverse possession of land and who later and upon the death of the owner, intestate, acquires by inheritance an interest therein as a cotenant with other heirs but continues in exclusive possession under his original adverse entry is not required to perform any other or further act of ouster in order to maintain his adverse possession against his cotenants. The continuity of his original adverse possession is not interrupted by his acquisition of an interest in the property or by the cotenancy. Anderson v. Shelton, 92 N.W.2d 166, 1958 N.D. LEXIS 89 (N.D. 1958).
Mineral Estates.
Trial court holding that surface estate owner’s extraction and use of coal did not constitute adverse possession of the severed mineral estate was not clearly erroneous where the extraction of the coal was done by dynamite blasting on a small scale and the coal was used only for domestic purposes. Burlington N. v. Hall, 322 N.W.2d 233, 1982 N.D. LEXIS 319 (N.D. 1982).
Where there is a severance of the mineral estate from the surface, the title to one cannot be acquired by adverse possession of the other, and possession of the surface estate under color of title with payment of taxes for the statutory period does not constitute possession of the severed mineral estate and is not adverse to the title holder of the mineral estate. Burlington N. v. Hall, 322 N.W.2d 233, 1982 N.D. LEXIS 319 (N.D. 1982).
Where the mineral estate had been severed from the surface estate, possession of the surface estate by a party and her predecessors in interest did not constitute possession of the severed mineral estate sufficient for adverse possession; such party and her predecessors in interest would need to have had open, adverse, and undisputed possession of the mineral estate for a period of ten years in order to claim title to the mineral estate by adverse possession. Sickler v. Pope, 326 N.W.2d 86, 1982 N.D. LEXIS 376 (N.D. 1982).
Party, who received a deed for the property pursuant to a contract for deed executed by only one cotenant and who established title to the entire surface estate by adverse possession against the other cotenants’ interests, did not establish title to the minerals by adverse possession where there was no actual possession of the minerals, and thus no ouster of the other cotenants’ interests in the minerals. Nelson v. Christianson, 343 N.W.2d 375, 1984 N.D. LEXIS 237 (N.D. 1984).
Minor, Adverse Possession Against.
The title to the land becomes valid after the payment of taxes and adverse possession for ten years as against minors as well as against adults, notwithstanding the provisions of C.L. 1913, § 7372 (28-01-14). Schauble v. Schulz, 137 F. 389, 69 C.C.A. 581 (8th Cir. 1905).
Municipal Alley.
Where plaintiff in an action to quiet title held land that formerly served as a city alleyway under color of title, possession of the property adverse to the city for the statutory period did not divest the city of its title in the property, even though plaintiff’s actions with respect thereto satisfied all the statutory requirements. Smith v. Anderson, 144 N.W.2d 530, 1966 N.D. LEXIS 107 (N.D. 1966).
Municipal Streets.
A municipality cannot be divested of the title of its streets held in trust for public use by adverse possession for the prescriptive period. City of Jamestown v. Miemietz, 95 N.W.2d 897, 1959 N.D. LEXIS 78 (N.D. 1959).
Question of Fact.
The determination of whether or not there has been an adverse use is a question of fact, which will not be set aside on appeal unless it is clearly erroneous. Benson v. Taralseth, 382 N.W.2d 649, 1986 N.D. LEXIS 265 (N.D. 1986).
Tacking Possessions.
The doctrine of tacking possessions, generally applicable under the statute of limitations for the recovery of real estate, does not apply under this statute, and such statute does not permit one claiming title thereunder to make out otherwise insufficient adverse possession and payment of taxes by adding to his possession the prior adverse possession of his grantor. J. B. Streeter, Jr., Co. v. Fredrickson, 11 N.D. 300, 91 N.W. 692, 1902 N.D. LEXIS 216 (N.D. 1902).
Taxes.
The claimant to title by adverse possession has fully complied with the law when he has paid the taxes upon the land, even though they have also been paid by the holder of the record title thereto. Benson v. Taralseth, 382 N.W.2d 649, 1986 N.D. LEXIS 265 (N.D. 1986).
What Constitutes Adverse Possession.
A cutting of hay upon wild prairie land, and paying taxes upon the land, does not establish a title under adverse possession. Page v. Smith, 33 N.D. 369, 157 N.W. 477, 1916 N.D. LEXIS 103 (N.D. 1916).
To establish a claim against cotenants, an adverse tenant must show adverse and hostile possession constituting ouster of the cotenants. Stoll v. Gottbreht, 45 N.D. 158, 176 N.W. 932, 1920 N.D. LEXIS 113 (N.D. 1920).
If a deed executed by a cotenant purports to convey full title to the land to a stranger and the grantee records his deed and enters into possession of all the land described in the deed, the possession of the grantee is adverse to the other cotenants and is under color of title. Morrison v. Hawksett, 64 N.W.2d 786, 1954 N.D. LEXIS 79 (N.D. 1954).
A county in possession of real estate under a void tax deed does not hold adversely against persons having the right to redeem from the tax sale. Accola v. Miller, 76 N.W.2d 517, 1956 N.D. LEXIS 116, 1956 N.D. LEXIS 117 (N.D. 1956).
When a tenant has surrendered possession to the landlord resulting in a complete termination of the lease, possession obtained thereafter under a reentry made under color of title from a different source shows hostility to and is adverse to the former landlord. Wilson v. Divide County, 76 N.W.2d 896, 1956 N.D. LEXIS 121 (N.D. 1956).
The possession of land or minerals under one tenant in common is also the possession of the other cotenants. Smith v. Nyreen, 81 N.W.2d 769, 1957 N.D. LEXIS 111 (N.D. 1957).
Where fence along north edge of disputed triangle of land was not erected for purpose of excluding adjoining landowner and where land, which was low and marshy and best suited for hunting, was used with larger tract for grazing and allowed to remain in wild state with fence having almost completely disappeared at time of quiet title trial, use of land was not sufficient to establish that it was held adversely, and no hostile possession was shown, so that title was not acquired by adverse possession. Woodland v. Woodland, 147 N.W.2d 590, 1966 N.D. LEXIS 146 (N.D. 1966).
Royalty interests cannot be possessed until the minerals have been extracted from the ground, at which point they become personal property. Therefore, royalty interests cannot be possessed for purposes of the statute of limitations in N.D.C.C. § 28-01-05 or for purposes of adverse possession under N.D.C.C. § 47-06-03. Siana Oil & Gas Co., LLC v. Dublin Co., 2018 ND 164, 915 N.W.2d 134, 2018 N.D. LEXIS 177 (N.D. 2018).
Collateral References.
Religious society, adverse possession by, 4 A.L.R.2d 123.
Mortgagee before foreclosure, adverse possession by, 7 A.L.R.2d 1131.
Recording statutes as affecting title by adverse possession, 9 A.L.R.2d 850.
Tacking adverse possession of area not within description of deed or contract, 17 A.L.R.2d 1128.
Seasonal possession: sufficiency, as regards continuity, of seasonal possession other than for agricultural or logging purposes, 24 A.L.R.2d 632.
Cotenants: possession by stranger claiming under conveyance by cotenant as adverse to other cotenants, as affected by nature or extent of possession, 32 A.L.R.2d 1214, 1223.
Mines or minerals, acquisition of title to, by adverse possession, 35 A.L.R.2d 124.
Mortgage foreclosure: possession of mortgagor or successor in interest as adverse to purchaser at foreclosure sale, 38 A.L.R.2d 348.
Landlord and tenant: adverse possession of landlord as affected by tenant’s recognition of title of third person, 38 A.L.R.2d 826.
Tax deed: void tax deed, tax sale certificate and the like as constituting color of title, 38 A.L.R.2d 986.
Grantor’s possession as adverse possession against grantee, 39 A.L.R.2d 353.
Reputation as to ownership or claim as admissible on question of adverse possession, 40 A.L.R.2d 770.
Cemetery or graveyard authorities, acquisition of title to ground through adverse possession by, 41 A.L.R.2d 925.
Parol gift of land, adverse possession by donee under, 43 A.L.R.2d 6.
Adverse possession of executor or administrator or his vendee as continuous with that of ancestor and heirs, 43 A.L.R.2d 1061.
Marketable title: title by or through adverse possession as marketable, 46 A.L.R.2d 544.
Tax sales or forfeitures by or to governmental units as interrupting adverse possession, 50 A.L.R.2d 600.
Trusts: possession and treatment of trust realty by trustee as sufficient repudiation of express trust to cause statute of limitations to run, 54 A.L.R.2d 13, 147.
Public property: acquisition by adverse possession or use of public property held by governmental unit otherwise than for streets, alleys, parks or common, 55 A.L.R.2d 554.
What acts, claims, circumstances, instruments, color of title, judgment, or thing of record will ground adverse possession in a life tenant as against remaindermen or reversioners, 58 A.L.R.2d 299.
Forged deed or bond for title as constituting color of title, 68 A.L.R.2d 452.
Judgment or decree as constituting color of title, 71 A.L.R.2d 404.
Executor or administrator, adverse possession of, as against deceased owner’s heirs or devisees, 73 A.L.R.2d 1097.
Boundaries: adverse possession involving ignorance or mistake as to boundaries — modern views, 80 A.L.R.2d 1171.
Cotenants, adverse possession between, 82 A.L.R.2d 5.
Railroads: adverse possession of railroad’s right of way by another, 95 A.L.R.2d 468, 479.
Encroachment: adverse possession based on encroachment of building or other structure, 2 A.L.R.3d 1005.
State or other governmental unit or agency, acquisition of title to land by adverse possession by, 18 A.L.R.3d 678.
Grazing of livestock or gathering of natural crop as fulfilling traditional elements of eminent domain, 48 A.L.R.3d 818.
Public use: use of property by public as affecting acquisition of title by adverse possession, 56 A.L.R.3d 1182.
Tolling statute: owner’s surveying of land as entry thereon tolling running of statute of limitations for purposes of adverse possession, 76 A.L.R.3d 1202.
Grazing of livestock, gathering of natural crop, or cutting of timber by record owner as defeating exclusiveness or continuity of possession by one claiming title by adverse possession, 39 A.L.R.4th 1148.
Law Reviews.
North Dakota’s Ten-Year Statute of Limitations, 28 N.D. L. Rev. 159 (1952).
Severed Mineral Interests, A Problem Without A Solution? 46 N.D. L. Rev. 451 (1970).
47-06-04. Fixtures — When tenant may remove.
When a person affixes that person’s property to the land of another without an agreement permitting that person to remove it, the thing affixed belongs to the owner of the land, unless the owner of the land chooses to require the former to remove it. A tenant may remove from the demised premises, anytime during the continuance of the tenant’s term, anything affixed thereto, for the purpose of trade, manufacture, ornament, or domestic use, if the removal can be effected without injury to the premises, unless the thing has become an integral part of the premises by the manner in which it is affixed. When any tenant upon agricultural land shall have built, erected, or placed upon such leased premises during the tenant’s tenancy, any grain bin, granary, or structure for the purpose of housing grain, and no written agreement between the landlord and the tenant has been made as to its removal, the tenant may remove the same at any time within eight months after the termination of the tenant’s lease and the vacating of said premises. The tenant shall not have said right of removal as against the owner or holder of any mortgage, deed, or conveyance which shall have been filed and recorded after the building, erection, or placing of such bin, granary, or structure, unless such tenant, within sixty days after such building, erecting, or placing, shall have filed in the office of the recorder a written notice describing the land, the character of the structure, and stating that the tenant intends to remove such structure as provided by law.
Source:
Civ. C. 1877, § 583; R.C. 1895, § 3492; R.C. 1899, § 3492; R.C. 1905, § 4929; C.L. 1913, § 5472; S.L. 1929, ch. 129, § 1; R.C. 1943, § 47-0604; S.L. 2001, ch. 120, § 1.
Derivation:
Cal. Civ. C., 1013.
Notes to Decisions
- Agreement Between Parties.
- Determination of Fixtures.
- Eminent Domain.
- Heating Equipment.
- Mortgagee’s Rights.
- Right to Remove Fixtures.
- Termination of Tenancy.
- Termination of Tenancy, Bankruptcy.
- Trade Fixtures Test.
- What Constitutes Fixtures.
Agreement Between Parties.
By agreement the parties concerned may give fixtures the legal character of realty or personalty, and such agreement will be enforced so long as the rights of third parties are not prejudiced thereby. Myrick v. Bill, 17 N.W. 268, 3 Dakota 284, 1883 Dakota LEXIS 3 (Dakota 1883); Warner v. Intlehouse, 60 N.D. 542, 235 N.W. 638, 1931 N.D. LEXIS 201 (N.D. 1931).
Determination of Fixtures.
The determination of whether or not items are trade fixtures is a question of law. Schnaible v. Bismarck, 275 N.W.2d 859, 1979 N.D. LEXIS 209 (N.D. 1979).
Eminent Domain.
Owner of trade fixtures is entitled to just compensation from the condemnor if such fixtures are taken or damaged as a result of a condemnation; fact that owner of trade fixtures removes such fixtures subsequent to the condemnation does not deny him his right to compensation for damage to the fixtures resulting from the condemnation. Schnaible v. Bismarck, 275 N.W.2d 859, 1979 N.D. LEXIS 209 (N.D. 1979).
Heating Equipment.
Heating apparatus constituted trade fixtures, where it was not permanently and irrevocably attached to building but was affixed simply by bolts, and was removed without causing any substantial damage to the building, as an adequate heating system is a sine qua non to the operation of a theater, since when a tenant installs fixtures in furtherance of his own purposes, there is a presumption that they are intended to be trade fixtures. R & D Amusement Corp. v. Christianson, 392 N.W.2d 385, 1986 N.D. LEXIS 382 (N.D. 1986).
Mortgagee’s Rights.
The fact that there was an agreement between the mortgagor and the seller of a light plant, that until the plant was paid for it should be considered chattel property, did not affect the rights of the mortgagees of the real estate or those claiming under them, as against the mortgagor. Klocke v. Troske, 57 N.D. 404, 222 N.W. 262, 1928 N.D. LEXIS 144 (N.D. 1928).
Fixtures annexed to the land by the mortgagor after the making of the mortgage were subject to the mortgage. Klocke v. Troske, 57 N.D. 404, 222 N.W. 262, 1928 N.D. LEXIS 144 (N.D. 1928).
Right to Remove Fixtures.
That which is affixed to land is real property and if property is affixed to the land of another without agreement permitting its removal, it belongs to the owner of the land unless he chooses to require its removal, except as otherwise provided by this section. Gussner v. Mandan Creamery & Produce Co., 78 N.D. 594, 51 N.W.2d 352, 1952 N.D. LEXIS 68 (N.D. 1952).
This section is liberally construed in favor of the right of a tenant to remove trade fixtures and when the tenancy is terminated for reasons other than the expiration of the full term, the right to remove trade fixtures must be exercised within a reasonable time after termination. Gussner v. Mandan Creamery & Produce Co., 78 N.D. 594, 51 N.W.2d 352, 1952 N.D. LEXIS 68 (N.D. 1952).
A fence placed on the property of another is the property of the landowner unless he chooses to require its removal, but if he requires its removal, then later tears it down and refuses to give it up to the true owner upon demand, he is guilty of conversion. Frank v. Schaff, 123 N.W.2d 827, 1963 N.D. LEXIS 114 (N.D. 1963).
The right of an outgoing tenant to remove trade fixtures is based upon the sound policy of encouraging trade and industry by allowing tenants to make the most beneficial use of the leased premises. Otherwise, a tenant would hesitate to undergo large expenditures in installing the necessities of his trade, if ownership of these articles would pass to the landlord by operation of law. R & D Amusement Corp. v. Christianson, 392 N.W.2d 385, 1986 N.D. LEXIS 382 (N.D. 1986).
In order for an agricultural tenant to preserve the right to remove a grain bin against a holder of a mortgage recorded after the erection of the bin, the tenant must file a description of the bin and a notice of his or her intent to remove it with the county register of deeds [now recorder]. Farm Credit Bank v. Martinson, 453 N.W.2d 816, 1990 N.D. LEXIS 83 (N.D.), cert. denied, 498 U.S. 846, 111 S. Ct. 131, 112 L. Ed. 2d 99, 1990 U.S. LEXIS 4468 (U.S. 1990).
Where tenant erected the grain bins in controversy on leased property prior to the recordation of bank’s mortgage, and tenant did not file a notice with the county register of deeds [now recorder] which would have given bank, as the holder of a mortgage, any notice of tenant’s intention to remove the bins, tenant failed to preserve his right of removal against the subsequent mortgagee; as a result, there was no reason to include him as a party in foreclosure proceedings on the leased property. Farm Credit Bank v. Martinson, 453 N.W.2d 816, 1990 N.D. LEXIS 83 (N.D.), cert. denied, 498 U.S. 846, 111 S. Ct. 131, 112 L. Ed. 2d 99, 1990 U.S. LEXIS 4468 (U.S. 1990).
Dental cabinets, which were screwed into the wall, plumbed, and wired, were intended by the parties to be trade fixtures sold with the dental practice where the cabinets were separately valued as personal property in the purchase price of the dental practice and listed as depreciable assets of the practice by both the former owner and the lessee. Pfeifle v. Tanabe, 2000 ND 219, 620 N.W.2d 167, 2000 N.D. LEXIS 269 (N.D. 2000).
Termination of Tenancy.
Where a tenancy is cut short on account of acts which work a forfeiture by the tenant of the remainder of the term but not an abandonment of the trade fixtures, such fixtures may be removed within a reasonable time after such termination of the tenancy. Hamilton v. Charlebois, 63 N.D. 504, 248 N.W. 676, 1933 N.D. LEXIS 202 (N.D. 1933).
Agricultural tenant lost any right to the fixtures and improvements that he left behind when his farm tenancy ended, long before the foreclosure. Because tenant had no possession of, nor an ownership interest in, the land or its improvements, the county court properly ordered him and his claimed goods evicted. Farm Credit Bank v. Martinson, 478 N.W.2d 810, 1991 N.D. LEXIS 229 (N.D. 1991).
Termination of Tenancy, Bankruptcy.
A trustee in bankruptcy succeeded to the rights of a bankrupt tenant in trade fixtures which tenant could remove within a reasonable time after the termination of the tenancy. Gussner v. Mandan Creamery & Produce Co., 78 N.D. 594, 51 N.W.2d 352, 1952 N.D. LEXIS 68 (N.D. 1952).
Trade Fixtures Test.
The general tests to be applied in determining if an item is a trade fixture are (1) annexation to the realty, either constructive or actual; (2) adaptation or application to the use or purpose to which that part of the realty to which it is connected is appropriated; and (3) intention to make the article a permanent accession to the freehold. Schnaible v. Bismarck, 275 N.W.2d 859, 1979 N.D. LEXIS 209 (N.D. 1979).
In general, three factors are examined to determine if an item installed in a building is a trade fixture: (1) The means by which it has been annexed to the real estate; (2) whether it is adapted to and necessary for the purpose for which the premises is devoted; and (3) whether the parties intended that the article become a permanent part of the realty. Preeminent among these factors is the parties’ intent; the other two factors find their primary utility as evidence of that intent. R & D Amusement Corp. v. Christianson, 392 N.W.2d 385, 1986 N.D. LEXIS 382 (N.D. 1986).
What Constitutes Fixtures.
A light plant firmly attached to the floor in the basement of a farm dwelling house, with necessary equipment, and a hay carrier attached to a barn, with necessary equipment, are fixtures. Klocke v. Troske, 57 N.D. 404, 222 N.W. 262, 1928 N.D. LEXIS 144 (N.D. 1928).
Whether an item constitutes a trade fixture depends upon the facts and circumstances of each case. However, a trade fixture can generally be defined as personal property annexed to the leased premises by the tenant for the purpose of carrying on the business to which the premises are devoted. R & D Amusement Corp. v. Christianson, 392 N.W.2d 385, 1986 N.D. LEXIS 382 (N.D. 1986).
Collateral References.
Sprinkler system as fixture as between landlord and tenant, 19 A.L.R.2d 1300, 1314.
Amusement apparatus or device as fixture, 41 A.L.R.2d 664.
Appliances, accessories, pipes, or other articles connected with plumbing as fixtures, 52 A.L.R.2d 222.
Carpets, linoleum, or the like, affixed by a tenant as fixtures, 55 A.L.R.2d 1044, 1048.
Electronic computing equipment as fixture, 6 A.L.R.3d 497.
Leases: what constitutes improvements, alterations or additions within provisions of lease permitting or prohibiting tenant’s removal thereof at termination of lease, 30 A.L.R.3d 998.
Air-conditioning appliance, equipment, or apparatus as fixture, 69 A.L.R.4th 359.
Time within which tenant’s right to remove trade fixtures must be exercised, 109 A.L.R.5th 421.
Law Reviews.
Survey of decisions regarding mortgages, 67 N.D. L. Rev. 334 (1991).
47-06-04.1. Mobile home storm shelters — Placement and transfer of ownership.
- Upon approval of the mobile home park owner, the owner of a mobile home located in the park may construct a storm shelter in the mobile home park. The approval must be in writing and must include the type, location, and use of the shelter, and an agreement between the park owner and the mobile home owner concerning ownership and maintenance of the shelter.
- Notwithstanding section 47-06-04, the agreement between the owner of the mobile home and the park owner must provide that the owner of the mobile home is the owner of the shelter and may remove the shelter provided the land is returned to its original condition during any time that person owns the mobile home.
-
The shelter owner may transfer ownership of the shelter to either a person who purchases the mobile home or to the mobile home park owner. The transfer must be in writing; must include the type, location, and use of the shelter; must include the maintenance responsibilities of the parties; and must be signed by both parties. If a mobile home owner transfers the shelter to a purchaser of the mobile home, the terms of the transfer must be the same as the terms of the agreement between the park owner and the mobile home owner required under subsection 1.
- If a suitable price cannot be agreed upon with the mobile home park owner, the shelter owner is deemed to have transferred the ownership and maintenance responsibilities of the shelter to the park owner without cost, unless the shelter is removed or the shelter is transferred to a purchaser of the mobile home as provided in this section.
- If the park owner is unwilling to assume ownership of the shelter, the park owner may require the mobile home owner to remove the shelter and return the land to its original condition.
- The park owner is not liable for any injury or damages that may occur to the mobile home owner as a result of the installation or use of the mobile home storm shelter.
- All shelters must meet with the approval of local governing bodies.
Source:
S.L. 1983, ch. 501, § 1; 1997, ch. 388, § 1.
47-06-05. Riparian accretions.
Where from natural causes land forms by imperceptible degrees upon the bank of a river or stream, navigable or not navigable, either by accumulation of material or by the recession of the stream, such land belongs to the owner of the bank, subject to any existing right of way over the bank.
Source:
Civ. C. 1877, § 584; R.C. 1895, § 3493; R.C. 1899, § 3493; R.C. 1905, § 4930; C.L. 1913, § 5473; R.C. 1943, § 47-0605.
Derivation:
Cal. Civ. C., 1014.
Cross-References.
Boundary of ownership to banks and beds of streams, see N.D.C.C. § 47-01-15.
Notes to Decisions
- Accretion Replacing Land Lost by Erosion.
- Accretions to Upland.
- Application.
- Division of Accretions.
- Doctrine of Reliction.
- Inland Lake.
- Island Accretion.
- Island Erosion.
- Patent from United States.
- Roadway Easements.
- Title in State.
Accretion Replacing Land Lost by Erosion.
Where land shown as riparian on the original survey is lost by erosion so that nonriparian land becomes riparian, and land is thereafter built by accretion to the land which was originally nonriparian, extending over the former location of the original riparian tract, the owner of the land which was originally nonriparian has title only to the accreted land within the boundary of the formerly nonriparian tract. All other land so accreted, extending over the area of the original riparian tract, becomes the property of the original riparian owner, or his successor in interest. Perry v. Erling, 132 N.W.2d 889, 1965 N.D. LEXIS 168 (N.D. 1965).
District court did not err in ruling as a matter of law that plaintiff could not claim title to accretions beyond the fixed boundary line set forth in his deed. Excepting land eroding into the river from the grant of property in defendants' deeds did not amount to a conveyance of accretions located in North Dakota to plaintiff. Norby v. Estate of Kuykendall, 2015 ND 232, 869 N.W.2d 405, 2015 N.D. LEXIS 252 (N.D. 2015).
Accretions to Upland.
The presumption that a conveyance of the upland conveys accretions to the upland is rebuttable. Jennings v. Shipp, 115 N.W.2d 12, 1962 N.D. LEXIS 74 (N.D. 1962).
Application.
The word “natural” tends to indicate that this section does not apply to accretion and reliction resulting from artificial or man-made efforts. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
For discussion of evidence sufficient to warrant application of the doctrine of reliction and an ambulatory high watermark to determine the boundary of a navigable body of water. In re Ownership of Bed of Devils Lake, 423 N.W.2d 141, 1988 N.D. LEXIS 113 (N.D. 1988).
Division of Accretions.
The law governing the title to accretions that have formed since the establishment of meander lines and other boundaries of governmental subdivisions by the original United States Government Survey does not require that the division of the accretions between adjacent riparian owners be made by extending the boundary lines of legal subdivisions. Jennings v. Shipp, 115 N.W.2d 12, 1962 N.D. LEXIS 74 (N.D. 1962).
The main object to be kept in view in a division of accretions is that the division shall be equitable and proportional so as to give each owner a fair share of the land to be divided and his due portion of the new shore line proportionate to his share of the original shore. Jennings v. Shipp, 115 N.W.2d 12, 1962 N.D. LEXIS 74 (N.D. 1962).
Accretions may be divided between adjacent riparian owners by agreement as well as by actual survey. Jennings v. Shipp, 115 N.W.2d 12, 1962 N.D. LEXIS 74 (N.D. 1962).
Doctrine of Reliction.
In the event of accretion and reliction, any accreted or bared land belongs to the owner of the bank. North Shore v. Wakefield, 530 N.W.2d 297, 1995 N.D. LEXIS 52 (N.D. 1995).
Inland Lake.
The owner of land fronting on a lake is entitled to any land properly added to his frontage by accretion, provided the process was gradual and imperceptible, and that his land was not originally separated from the water’s edge by the intervening property of any other person. Brignall v. Hannah, 34 N.D. 174, 157 N.W. 1042, 1916 N.D. LEXIS 22 (N.D. 1916); Roberts v. Taylor, 47 N.D. 146, 181 N.W. 622, 1921 N.D. LEXIS 99 (N.D. 1921).
Island Accretion.
The owner of an island is entitled to land added thereto by accretion to the same extent as the owner of land on the shore of the mainland. Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
Island Erosion.
Where island in river had completely eroded away by 1933, land formed by accretions to east bank of river belonged to owners of lots on bank even though accreted land extended over area formerly occupied by island lots; thus owners of bank land lots were entitled to compensation for condemnation of land rather than owners of island lots. Peterson v. United States, 384 F.2d 664, 1967 U.S. App. LEXIS 4768 (8th Cir. N.D. 1967).
Where islands in river which were part of certain riparian lots were completely washed away over a period of time, and subsequent accretion formed new portions of land on certain riparian lots on the river bank, such new areas were the property of the owners of the riparian properties to which the new land attached itself, and did not belong to the successors in interest of the original grantee of the island property. United States v. 2,134.46 Acres of Land, 257 F. Supp. 723, 1966 U.S. Dist. LEXIS 10039 (D.N.D. 1966), aff'd, Peterson v. United States, 384 F.2d 664, 1967 U.S. App. LEXIS 4768 (8th Cir. N.D. 1967).
Patent from United States.
Where public lands bounded on a stream are patented by the United States without reservations or restrictions, the riparian rights of the patentee are determined by the law of the state in which the lands lie. Oberly v. Carpenter, 67 N.D. 495, 274 N.W. 509, 1937 N.D. LEXIS 105 (N.D. 1937).
Roadway Easements.
Where an easement was held by the state for a roadway across riparian land up to the high-water mark of the river, the terminal point of said easement continues to be the high-water mark, even though land may be added to the servient estate by accretion, thus extending the easement. Greeman v. Smith, 138 N.W.2d 433, 1965 N.D. LEXIS 111 (N.D. 1965).
Title in State.
Under this statute, the title to accretions on a navigable river is not reserved in the state. Gardner v. Green, 67 N.D. 268, 271 N.W. 775, 1937 N.D. LEXIS 80 (N.D. 1937).
Collateral References.
Filling or dredging, rights to land created at water’s edge by, 91 A.L.R.2d 857.
Adjoining property: right to accretion built up from one tract of land and extending laterally in front of adjoining tract without being contiguous thereto, 61 A.L.R.3d 1173.
Artificial condition not produced by such owner, riparian owner’s right to new land created by reliction or by accretion influenced by, 63 A.L.R.3d 249.
47-06-06. Avulsion — Title — Reclamation by original owner — Limitations.
If a river or stream, navigable or not navigable, carries away by sudden violence a considerable and distinguishable part of a bank and bears it to the opposite bank or to another part of the same bank, the owner of the part carried away may reclaim it within a year after the owner of the land to which it has been united takes possession thereof.
Source:
Civ. C. 1877, § 585; R.C. 1895, § 3494; R.C. 1899, § 3494; R.C. 1905, § 4931; C.L. 1913, § 5474; R.C. 1943, § 47-0606.
Derivation:
Cal. Civ. C., 1015.
47-06-07. Ancient streambed taken by owners of new course as indemnity.
If a stream, navigable or not navigable, forms a new course abandoning its ancient bed, the owners of the land newly occupied take by way of indemnity the ancient bed abandoned, each in proportion to the land of which the owner has been deprived.
Source:
Civ. C. 1877, § 589; R.C. 1895, § 3498; R.C. 1899, § 3498; R.C. 1905, § 4935; C.L. 1913, § 5478; R.C. 1943, § 47-0607.
Notes to Decisions
- Application.
- Application to Oil and Gas Interests.
- Extrinsic Aids.
- Grant from United States.
- History.
- Indemnification of Former Owners.
- Mineral and Surface Rights.
- Modification of Common Law.
- Ownership in Severalty.
Application.
This section applies to both natural and artificial changes in the course of a navigable river and to an abandoned riverbed that still contains some water. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
By providing that avulsion results in a change of title when a stream forms a new course abandoning its ancient bed, this section modifies the common law, under which this transfer of title did not occur. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
This section makes no exceptions in transferring ownership of abandoned riverbeds; therefore, it applies with equal force to oil and gas rights. J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
Application to Oil and Gas Interests.
This section applies to determine ownership of oil and gas interests underlying an abandoned riverbed. Kim-Go, H.K. Minerals, Inc. v. J.P. Furlong Enters., Inc., 460 N.W.2d 694 (N.D. 1990).
Extrinsic Aids.
This section does not clearly resolve whether the former owners of separate interests in new riverbed take the abandoned riverbed in severalty or on an undivided basis. It is therefore ambiguous and of doubtful meaning in this respect, and the court may look to extrinsic aids to ascertain the intent of the legislature. Kim-Go, H.K. Minerals, Inc. v. J.P. Furlong Enters., Inc., 460 N.W.2d 694 (N.D. 1990).
Grant from United States.
A grant of land in the bed of a nonnavigable river made by the United States while holding complete sovereignty over the locality including it cannot be divested by a retroactive rule or declaration of the state subsequently created out of that territory, classifying the river as navigable. Gable v. Angle, 7 F. Supp. 967, 1933 U.S. Dist. LEXIS 1899 (D. Okla. 1933).
History.
For discussion of the history of this section, see J.P. Furlong Enters., Inc. v. Sun Exploration & Prod. Co., 423 N.W.2d 130 (N.D. 1988).
Indemnification of Former Owners.
The intent of this section is to compensate former owners of the new riverbed for loss by bestowing upon them ownership of the abandoned bed in a quantity proportionate to their former ownership. The purpose of that indemnity is to restore the parties to their former positions as closely as possible. Kim-Go, H.K. Minerals, Inc. v. J.P. Furlong Enters., Inc., 460 N.W.2d 694 (N.D. 1990).
Mineral and Surface Rights.
This section does not distinguish between mineral and surface rights to the abandoned channel. Kim-Go v. J.P. Furlong Enters., 484 N.W.2d 118, 1992 N.D. LEXIS 99 (N.D. 1992).
Modification of Common Law.
Although this section modifies common-law by providing that avulsion results in a change of title when a stream forms a new course abandoning its ancient bed, that modification does not require abandonment of the principle favoring divided ownership. Kim-Go, H.K. Minerals, Inc. v. J.P. Furlong Enters., Inc., 460 N.W.2d 694 (N.D. 1990).
Ownership in Severalty.
This section authorizes ownership of the abandoned riverbed in severalty if former ownership of the land under the new bed was several. Kim-Go, H.K. Minerals, Inc. v. J.P. Furlong Enters., Inc., 460 N.W.2d 694 (N.D. 1990).
Law Reviews.
The Nature and Extent of Rights in Water in North Dakota, 51 N.D. L. Rev. 249 (1975).
Summary of significant decisions rendered by the North Dakota Supreme Court in 1989 relating to title to land, 65 N.D. L. Rev. 588 (1989).
47-06-08. Islands and relicted lands in navigable streams belong to state.
Islands and accumulations of land formed in the beds of streams which are navigable belong to the state, if there is no title or prescription to the contrary. The control and management, including the power to execute surface and mineral leases, of islands, relictions, and accumulations of land owned by the state of North Dakota in navigable streams and waters and the beds thereof, must be governed by chapter 61-33.
Source:
Civ. C. 1877, § 586; R.C. 1895, § 3495; R.C. 1899, § 3495; R.C. 1905, § 4932; C.L. 1913, § 5475; R.C. 1943, § 47-0608; S.L. 1953, ch. 276, § 1; 1957 Supp., § 47-0608; S.L. 1967, ch. 476, § 1; 1977, ch. 144, § 3; 1987, ch. 187, § 9; 1989, ch. 552, § 1.
Derivation:
Cal. Civ. C., 1016.
Cross-References.
Transfer of possessory interests in “sovereign lands” to board of university and school lands, see N.D.C.C. ch. 61-33.
Garrison diversion conservancy district, see N.D.C.C. ch. 61-24.
Notes to Decisions
“Navigable Waters” Defined.
If the waters of the stream involved are capable of a proper public use in the environment where situated and to which they are or may be made subservient, it is a navigable stream for purposes of this statute. Roberts v. Taylor, 47 N.D. 146, 181 N.W. 622, 1921 N.D. LEXIS 99 (N.D. 1921).
Title in State.
Where an island or accumulation of land forms apart from the mainland by the deposit of alluvial accretions in the bed of a navigable stream, the title to such island or accumulation of land, together with all additions thereto formed by natural causes through the gradual and imperceptible process of accretion, is vested in the state. State v. Loy, 74 N.D. 182, 20 N.W.2d 668, 1945 N.D. LEXIS 66 (N.D. 1945); Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
Collateral References.
Applicability of rules of accretion and reliction so as to confer title to additions upon owner of island or bar in navigable stream, 54 A.L.R.2d 643.
47-06-09. Islands and relicted land in nonnavigable streams.
An island or accumulation of land formed in a stream which is not navigable belongs to the owner of the shore on that side where the island or accumulation is formed, or if not formed on one side only, to the owners of the shore on the two sides, divided by an imaginary line drawn through the middle of the river.
Source:
Civ. C. 1877, § 587; R.C. 1895, § 3496; R.C. 1899, § 3496; R.C. 1905, § 4933; C.L. 1913, § 5476; R.C. 1943, § 47-0609.
Derivation:
Cal. Civ. C., 1017.
47-06-10. Island formed by dividing stream — Title.
If a stream, navigable or not navigable, in forming itself a new arm divides itself and surrounds land belonging to the owner of the shore and thereby forms an island, the island belongs to such owner.
Source:
Civ. C. 1877, § 588; R.C. 1895, § 3497; R.C. 1899, § 3497; R.C. 1905, § 4934; C.L. 1913, § 5477; R.C. 1943, § 47-0610.
Derivation:
Cal. Civ. C., 1018.
Notes to Decisions
Scope of Statute.
This statute contemplates a situation where a stream in high water, whether suddenly by avulsion, or gradually by intermittent action at flood stage, cuts a new or auxiliary channel around a portion of the mainland and leaves such portion intact as an island and as a recognizable segment of the mainland from which it was severed. Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
This statute has no application to a case where the stream, moving by gradual and imperceptible degrees, eroded and utterly destroyed the mainland in the area in controversy, leaving no part of it intact and identifiable above the low-water mark. Hogue v. Bourgois, 71 N.W.2d 47, 1955 N.D. LEXIS 114 (N.D. 1955).
CHAPTER 47-07 Personal or Movable Property — General Provisions
47-07-01. Jurisdiction — Law of domicile applies.
If there is no law to the contrary in the place where personal property is situated, it is deemed to follow the person of its owner and is governed by the law of the owner’s domicile.
Source:
Civ. C. 1877, § 359; R.C. 1895, § 3465; R.C. 1899, § 3465; R.C. 1905, § 4901; C.L. 1913, § 5444; R.C. 1943, § 47-0701.
Derivation:
Cal. Civ. C., 946.
Notes to Decisions
In General.
The law controlling personal property is governed by the law of the domicile of the owner if there is no law to the contrary in the place where the personal property is situated. This limitation of the otherwise universal rule applies when the disposition of the property does violence to the law of the place where the property is located, or where it is contrary to public policy. American Standard Life & Accident Ins. Co. v. Speros, 494 N.W.2d 599, 1993 N.D. LEXIS 1 (N.D. 1993).
Law Reviews.
Modern Escheat Statutes Dealing With Unclaimed Intangible Personal Property, 42 N.D. L. Rev. 441 (1966).
47-07-02. Thing in action defined.
A thing in action is a right to recover money or other personal property by a judicial proceeding.
Source:
Civ. C. 1877, § 360; R.C. 1895, § 3466; R.C. 1899, § 3466; R.C. 1905, § 4902; C.L. 1913, § 5445; R.C. 1943, § 47-0702.
Derivation:
Cal. Civ. C., 953.
Cross-References.
Damages for conversion of personalty, see N.D.C.C. § 32-03-23.
Notes to Decisions
Claim for Damages.
Where the property of the owner is damaged by reason of the negligence or wrongful act of another, the owner’s right of action to recover is a property right. Kaiser v. Minneapolis, S. P., S. S. M. Ry., 62 N.W.2d 40, 1953 N.D. LEXIS 95 (N.D. 1953).
Value of Chose.
Prima facie a chose in action is worth what appears to be due upon it, and unless the presumption is rebutted by legal evidence, it is conclusive. Anderson v. First Nat'l Bank, 6 N.D. 497, 72 N.W. 916, 1897 N.D. LEXIS 28 (N.D. 1897), aff'd, 172 U.S. 573, 19 S. Ct. 284, 43 L. Ed. 558, 1899 U.S. LEXIS 1397 (U.S. 1899).
47-07-03. Thing in action transferable.
A thing in action arising out of the violation of a right of property or out of an obligation may be transferred by the owner. Upon the death of the owner, it passes to the owner’s personal representatives except when in the cases provided by law it passes to the owner’s devisees or successor in office.
Source:
Civ. C. 1877, § 361; R.C. 1895, § 3467; R.C. 1899, § 3467; R.C. 1905, § 4903; C.L. 1913, § 5446; R.C. 1943, § 47-0703.
Derivation:
Cal. Civ. C., 954.
Notes to Decisions
Contract Rights.
A cause of action for the breach of a covenant of seisin is assignable. Beulah Coal Mining Co. v. Heihn, 46 N.D. 646, 180 N.W. 787, 1920 N.D. LEXIS 71 (N.D. 1920).
Money due under a contract for personal service can be assigned notwithstanding the fact that the contract itself is not assignable. Dixon-Reo Co. v. Horton Motor Co., 49 N.D. 304, 191 N.W. 780, 1922 N.D. LEXIS 56 (N.D. 1922).
A contract for the sale of land, in so far as it expresses the purchaser’s obligation to pay the price, is transferable without the purchaser’s consent. First Sec. Bank v. Hillesland, 62 N.D. 31, 241 N.W. 289, 1932 N.D. LEXIS 147 (N.D. 1932).
Tort Claim.
The mere naked right of action for fraud and deceit is not a thing in action arising out of the violation of a right of property or out of an obligation. Grabow v. Bergeth, 59 N.D. 214, 229 N.W. 282, 1930 N.D. LEXIS 134 (N.D. 1930).
Fraud causing a pecuniary loss is not “damage to goods” of the deceased and a cause of action therefor does not survive, and is not assignable. Grabow v. Bergeth, 59 N.D. 214, 229 N.W. 282, 1930 N.D. LEXIS 134 (N.D. 1930).
A landowner’s claim for damages arising out of the negligent spraying of oats raised on his land is assignable. Burt v. Lake Region Flying Serv., 78 N.D. 928, 54 N.W.2d 339, 1952 N.D. LEXIS 88 (N.D. 1952).
Where the property of the owner is damaged by reason of the negligence or wrongful act of another, the owner’s right of action to recover damages is a property right and is assignable by the owner. Kaiser v. Minneapolis, S. P., S. S. M. Ry., 62 N.W.2d 40, 1953 N.D. LEXIS 95 (N.D. 1953).
47-07-04. Products of the mind — Ownership — Application.
The author of any product of the mind, whether it is an invention, a composition in letters or art, a design, with or without delineation or other graphical representation, has an exclusive ownership therein and in the representation or expression thereof which continues as long as the product and the representations or expressions thereof made by the author remain in the author’s possession.
Source:
Civ. C. 1877, § 570; R.C. 1895, § 3479; R.C. 1899, § 3479; R.C. 1905, § 4915; C.L. 1913, § 5458; R.C. 1943, § 47-0704.
Derivation:
Cal. Civ. C., 980.
Collateral References.
Sale of motion picture, radio, and television rights in play; defect in written record as ground for avoiding sale, 10 A.L.R.2d 728.
Television material, literary property in, 15 A.L.R.2d 785, 792.
Literary and artistic rights for purposes of, and their infringement by or in connection with, motion pictures, radio, and television, 23 A.L.R.2d 244.
Corporations: right to patent, copyright or trademark owned by corporation on dissolution thereof, 30 A.L.R.2d 938.
Telephone directory: telephone company’s rights in, and remedies available to protect, telephone directory and advertising material therein, 63 A.L.R.2d 1096, 1103.
Architectural plans, drawings or designs, what constitutes publication of, so as to result in loss of common-law copyright, 77 A.L.R.2d 1048.
Accountant, ownership of, and literary property in, working papers and data of, 90 A.L.R.2d 784.
Prospective assignment of renewal rights in copyright, 2 A.L.R.3d 1403.
Spoken word, common-law copyright in the, 32 A.L.R.3d 618.
Lectures, literary property in, 38 A.L.R.3d 779.
Punitive damages for invasion of common-law rights in literary property, allowance of, 40 A.L.R.3d 248.
Unfair competition by direct reproduction of literary, artistic or musical property, 40 A.L.R.3d 566.
Products liability: proof of defect under doctrine of strict liability in tort, 51 A.L.R.3d 8.
Invasion of privacy by radio or television, 56 A.L.R.3d 386.
Strict products liability: product malfunction or occurrence of accident as evidence of defect, 65 A.L.R.4th 346.
Parody as copyright infringement or fair use under Federal Copyright Act (17 USCS § 101 et seq.), 75 A.L.R. Fed. 822.
Law Reviews.
For Note: The Making Available Argument: Is Actual Distribution Required to Find Infringement Upon the Copyright Holder’s Distribution Right?, see 85 N.D. L. Rev. 371 (2009).
Article: Why Do All Casinos Seem To Be The Same? A Glance Into Casino Games, Gambling Machines And The Doctrine Of Fair Use, 87 N.D. L. Rev. 299 (2011).
Case Comment: Intellectual Property patents: The United States Supreme Court Affirms the Standard of Proof for Patent Invalidity: Microsoft Corp. v. I4i Ltd. P’ship, 131 S. CT. 2238 (2011), see 87 N.D. L. Rev. 401 (2011).
47-07-05. Joint ownership of products of the mind.
Unless otherwise agreed, a product of the mind in the production of which several persons are concerned jointly is owned by them as follows:
- If the product is single, in equal proportions; or
- If it is not single, in proportion to the contribution of each.
Source:
Civ. C. 1877, § 571; R.C. 1895, § 3480; R.C. 1899, § 3480; R.C. 1905, § 4916; C.L. 1913, § 5459; R.C. 1943, § 47-0705.
Derivation:
Cal. Civ. C., 981.
Collateral References.
Rights and remedies of coowners of copyright, 3 A.L.R.3d 1301.
47-07-06. Transfer of products of the mind.
The owner of any product of the mind, or of any representation or expression thereof, may transfer the owner’s property in the same.
Source:
Civ. C. 1877, § 572; R.C. 1895, § 3481; R.C. 1899, § 3481; R.C. 1905, § 4917; C.L. 1913, § 5460; R.C. 1943, § 47-0706.
Derivation:
Cal. Civ. C., 982.
47-07-07. Publication of products of the mind — Right to reproduce.
If the owner of a product of the mind intentionally makes it public, a copy or reproduction may be made public by any person without responsibility to the owner so far as the law of this state is concerned.
Source:
Civ. C. 1877, § 573; R.C. 1895, § 3482; R.C. 1899, § 3482; R.C. 1905, § 4918; C.L. 1913, § 5461; R.C. 1943, § 47-0707.
Derivation:
Cal. Civ. C., 983.
47-07-08. Identical products of the mind — Rights of respective owners.
If the owner of a product of the mind does not make it public, any other person subsequently and originally producing the same thing has the same right therein as the prior author, and such right is exclusive to the same extent against all persons except the prior author, or those claiming under the prior author.
Source:
Civ. C. 1877, § 574; R.C. 1895, § 3483; R.C. 1899, § 3483; R.C. 1905, § 4919; C.L. 1913, § 5462; R.C. 1943, § 47-0708.
Derivation:
Cal. Civ. C., 984.
47-07-09. Private communications — Ownership — Right of publication.
Letters and other private communications in writing belong to the person to whom they are addressed and delivered. They cannot be published, however, against the will of the writer except by authority of law.
Source:
Civ. C. 1877, § 575; R.C. 1895, § 3484; R.C. 1899, § 3484; R.C. 1905, § 4920; C.L. 1913, § 5463; R.C. 1943, § 47-0709.
Derivation:
Cal. Civ. C., 985.
47-07-10. Goodwill defined.
The goodwill of a business is the expectation of continued public patronage, but it does not include a right to use the name of any person from whom it was acquired.
Source:
Civ. C. 1877, § 577; R.C. 1895, § 3486; R.C. 1899, § 3486; R.C. 1905, § 4922; C.L. 1913, § 5465; R.C. 1943, § 47-0710.
Derivation:
Cal. Civ. C., 992.
Notes to Decisions
Length of Operation.
A business may possess good will even though it has been operated for a short period of time without net profits, or at a loss. Engstrom v. Larson, 77 N.D. 541, 44 N.W.2d 97, 1950 N.D. LEXIS 151 (N.D. 1950); Engstrom v. Larson, 79 N.D. 188, 55 N.W.2d 579, 1952 N.D. LEXIS 112 (N.D. 1952).
Partnership.
The good will of a partnership business is an asset of the partnership. Engstrom v. Larson, 77 N.D. 541, 44 N.W.2d 97, 1950 N.D. LEXIS 151 (N.D. 1950); Engstrom v. Larson, 79 N.D. 188, 55 N.W.2d 579, 1952 N.D. LEXIS 112 (N.D. 1952).
Reputation.
The good will of a business is the reputation it has established in the community, including the customers who usually trade there. MacFadden v. Jenkins, 40 N.D. 422, 169 N.W. 151, 1918 N.D. LEXIS 106 (N.D. 1918).
47-07-11. Goodwill — Transferability.
The goodwill of a business is property transferable in the same manner as any other.
Source:
Civ. C. 1877, § 578; R.C. 1895, § 3487; R.C. 1899, § 3487; R.C. 1905, § 4923; C.L. 1913, § 5466; R.C. 1943, § 47-0711.
Derivation:
Cal. Civ. C., 993.
Notes to Decisions
Adequacy of Consideration.
The good will of one’s business, although intangible, is adequate as a consideration for the promise of a purchaser and may form the subject matter of a contract of sale, in whole or in part. Mapes v. Metcalf, 10 N.D. 601, 88 N.W. 713, 1901 N.D. LEXIS 80 (N.D. 1901); MacFadden v. Jenkins, 40 N.D. 422, 169 N.W. 151, 1918 N.D. LEXIS 106 (N.D. 1918).
Corporate Assets.
Where the charter of a corporation expires after a long period of prosperity in the conduct of its business, and where for a period of years prior to its termination dividends had been earned and paid greatly in excess of a reasonable rate of interest on the capital invested, the good will has a substantial value, capable of being measured in money. Langer v. Fargo Mercantile Co., 48 N.D. 545, 186 N.W. 104, 1921 N.D. LEXIS 77 (N.D. 1921).
Presumption of Sale.
In absence of an expression to the contrary in the agreement of sale, the sale of a business will be presumed to pass the good will of the business with other assets. Engstrom v. Larson, 77 N.D. 541, 44 N.W.2d 97, 1950 N.D. LEXIS 151 (N.D. 1950); Engstrom v. Larson, 79 N.D. 188, 55 N.W.2d 579, 1952 N.D. LEXIS 112 (N.D. 1952).
Collateral References.
“Book value”: good will as included in “book value” in partnership agreement in determining value of partner’s interest, 47 A.L.R.2d 1425, 1429.
Good will as affecting rights and profits earned by partnership or joint adventure after death or dissolution, 55 A.L.R.2d 1391, 1417.
Implied transfer: sale of business or of real estate upon which business is conducted or transferring good will by implication, in absence of covenant not to compete, 65 A.L.R.2d 502.
Dissolution of partnership, accountability for good will on, 65 A.L.R.2d 521.
Eminent domain: good will or “going concern” value as element of lessee’s compensation for taking leasehold in eminent domain, 58 A.L.R.3d 566.
Divorce and separation: Goodwill in medical and dental practice as property subject to distribution on dissolution of marriage, 76 A.L.R.4th 1025.
Divorce and separation: Goodwill in law practice as property subject to distribution on dissolution of marriage, 79 A.L.R.4th 171.
Law Reviews.
Good Will, 4 Dak. L. Rev. 15 (1932).
47-07-12. Sale of goodwill — Warranty.
One who sells the goodwill of a business thereby warrants that the seller will not endeavor to draw off any of the customers.
Source:
Civ. C. 1877, § 1016; R.C. 1895, § 3983; R.C. 1899, § 3983; R.C. 1905, § 5430; C.L. 1913, § 5986; R.C. 1943, § 47-0712.
Derivation:
Cal. Civ. C., 1776.
Notes to Decisions
Restraint of Trade.
The provision that one who sells the good will of a business may agree to refrain from carrying on a similar business within specified territory excepts such a contract in restraint of trade from the condemnation of an illegality which otherwise would exist. Mapes v. Metcalf, 10 N.D. 601, 88 N.W. 713, 1901 N.D. LEXIS 80 (N.D. 1901).
47-07-13. Title deeds — Ownership passes with title.
Instruments essential to the title of real property which are not kept in a public office as a record pursuant to law belong to the person in whom, for the time being, such title may be vested, and pass with the title.
Source:
Civ. C. 1877, § 579; R.C. 1895, § 3488; R.C. 1899, § 3488; R.C. 1905, § 4924; C.L. 1913, § 5467; R.C. 1943, § 47-0713.
Derivation:
Cal. Civ. C., 994.
47-07-14. Museum records — Disposition of loaned or donated objects.
Every nonprofit or noncounty museum in this state which is loaned or receives by donation any object for public display or safekeeping must keep a record of those objects. The record must indicate the owner or owners of the loaned objects and their addresses. A duplicate of the record must be filed with the county in which the museum is located. The board of directors or any person in charge of a museum which is closing or closed must return loaned objects to the recorded owners. All unreturned or unclaimed objects must be retained for two years to ensure that individuals have the opportunity to reclaim loaned objects. After that time, unclaimed objects may be disposed of at the discretion of the board of directors or person in charge of the museum.
Source:
S.L. 1987, ch. 151, § 1.
CHAPTER 47-08 Accession to Personal Property
47-08-01. Things inseparably united.
When things which belong to different owners have been united so as to form a single thing and cannot be separated without injury, the whole belongs to the owner of the thing which forms the principal part, but such owner must reimburse the value of the residue to the other owner or surrender the whole to the other owner.
Source:
Civ. C. 1877, § 590; R.C. 1895, § 3499; R.C. 1899, § 3499; R.C. 1905, § 4936; C.L. 1913, § 5479; R.C. 1943, § 47-0801.
Derivation:
Cal. Civ. C., 1025.
Collateral References.
Confusion of goods by act of third person, 39 A.L.R.2d 555.
Accession to motor vehicle, 43 A.L.R.2d 813.
47-08-02. Principal part defined.
The principal part shall mean that part to which the other has been united only for the use, ornament, or completion of the former, unless the latter is the more valuable and has been united without the knowledge of its owner, who in the latter case, may require it to be separated and returned to the owner, although some injury should result to the thing to which it has been united. If neither part can be considered the principal part, the more valuable, or if the values are nearly equal, the more considerable in bulk, is to be deemed the principal part.
Source:
Civ. C. 1877, §§ 591, 592; R.C. 1895, §§ 3500, 3501; R.C. 1899, §§ 3500, 3501; R.C. 1905, §§ 4937, 4938; C.L. 1913, §§ 5480, 5481; R.C. 1943, § 47-0802.
Derivation:
Cal. Civ. C., 1026, 1027.
47-08-03. Materials of different owners united by labor of one — Inseparable without inconvenience — Common ownership.
When one has made use of materials which in part belong to that person and in part to another, in order to form a thing of a new description without having destroyed any of the materials, but in such a way that they cannot be separated without inconvenience, the thing formed is common to both proprietors in proportion, as respects the one, of the materials belonging to that person, and as respects the other, of the materials belonging to that person and the price of that person’s workmanship.
Source:
Civ. C. 1877, § 594; R.C. 1895, § 3503; R.C. 1899, § 3503; R.C. 1905, § 4940; C.L. 1913, § 5483; R.C. 1943, § 47-0803.
Derivation:
Cal. Civ. C., 1029.
47-08-04. Material of several owners — Admixture without consent of the same — Ownership — Determination.
When a thing has been formed by the admixture of several materials of different owners and neither can be considered the principal substance, an owner, without whose consent the admixture was made, may require separation if the materials can be separated without inconvenience. If they cannot be thus separated, the owners acquire the thing in common in proportion to the quantity, quality, and value of their materials. If the materials of one were far superior to those of the others, both in quantity and value, that person may claim the thing on reimbursing to the others the value of their materials.
Source:
Civ. C. 1877, § 595; R.C. 1895, § 3504; R.C. 1899, § 3504; R.C. 1905, § 4941; C.L. 1913, § 5484; R.C. 1943, § 47-0804.
Derivation:
Cal. Civ. C., 1030.
47-08-05. Thing made from another’s materials.
If one makes a thing from materials belonging to another, the latter may claim the thing on reimbursing the value of the workmanship unless the value of the workmanship exceeds the value of the materials, in which case the thing belongs to the maker, on reimbursing the value of the materials.
Source:
Civ. C. 1877, § 593; R.C. 1895, § 3502; R.C. 1899, § 3502; R.C. 1905, § 4939; C.L. 1913, § 5482; R.C. 1943, § 47-0805.
Derivation:
Cal. Civ. C., 1028.
47-08-06. Willful uniting material without consent — Nonconsenting owner entitled to product — Limitation.
The foregoing sections of this chapter are not applicable to cases in which one willfully uses the materials of another without the other’s consent. In such cases the product belongs to the owner of the materials if their identity can be traced.
Source:
Civ. C. 1877, § 596; R.C. 1895, § 3505; R.C. 1899, § 3505; R.C. 1905, § 4942; C.L. 1913, § 5485; R.C. 1943, § 47-0806.
Derivation:
Cal. Civ. C., 1031.
47-08-07. Union of material — Right to restitution or value by nonconsenting owner.
In all cases where one whose materials have been used without the person’s knowledge in order to form a product of a different description can claim an interest in such product, the person has an option to demand either restitution of the person’s materials in kind in the same quantity, weight, measure, and quality, or the value thereof, or where the person is entitled to the product, the value thereof in place of the product.
Source:
Civ. C. 1877, § 597; R.C. 1895, § 3506; R.C. 1899, § 3506; R.C. 1905, § 4943; C.L. 1913, § 5486; R.C. 1943, § 47-0807.
Derivation:
Cal. Civ. C., 1032.
47-08-08. Damages — Liability of person uniting materials of another.
One who wrongfully employs materials belonging to another is liable to that person in damages in addition to any other liability prescribed by this chapter.
Source:
Civ. C. 1877, § 598; R.C. 1895, § 3507; R.C. 1899, § 3507; R.C. 1905, § 4944; C.L. 1913, § 5487; R.C. 1943, § 47-0808.
Derivation:
Cal. Civ. C., 1033.
CHAPTER 47-09 Title by Transfer — General Provisions
47-09-01. Transfer defined.
Transfer is an act of the parties or of the law by which the title to property is conveyed from one living person to another.
Source:
Civ. C. 1877, § 599; R.C. 1895, § 3508; R.C. 1899, § 3508; R.C. 1905, § 4945; C.L. 1913, § 5488; R.C. 1943, § 47-0901.
Derivation:
Cal. Civ. C., 1039.
Cross-References.
Validation of execution of instruments, see N.D.C.C. ch. 1-04.
Notes to Decisions
Equitable Interest.
A sale under execution of corporate stock which has been pledged will pass to the purchaser at the sale the equitable interest of the pledgor. Van Cise v. Merchants' Nat'l Bank, 33 N.W. 897, 4 Dakota 485, 1887 Dakota LEXIS 14 (Dakota 1887).
Meander Line as Boundary.
Unless a deed indicates a contrary intent with an explicit reservation or exception, or the record title indicates a prior separation of the upland and the riparian land, a deed that designates a meander line as the boundary of a conveyance conveys the grantor’s property interest to the ordinary high watermark, and also correlative interests vis-`-vis the state in the area between the ordinary high watermark and the ordinary low watermark. North Shore v. Wakefield, 530 N.W.2d 297, 1995 N.D. LEXIS 52 (N.D. 1995).
47-09-02. What may be transferred — Exceptions.
Property of any kind may be transferred except:
- A mere possibility not coupled with an interest.
- A mere right of re-entry or of repossession for breach of a condition subsequent which cannot be transferred to anyone except the owner of the property affected thereby.
Source:
Civ. C. 1877, §§ 601 to 603; R.C. 1895, §§ 3510 to 3512; R.C. 1899, §§ 3510 to 3512; R.C. 1905, §§ 4947 to 4949; C.L. 1913, §§ 5490 to 5492; R.C. 1943, § 47-0902.
Derivation:
Cal. Civ. C., 1044 to 1046.
Notes to Decisions
Expectancy of An Heir Apparent.
Under the real property law of both California and North Dakota, a mere possibility, such as an expectancy of an heir apparent, is not to be deemed an interest of any kind, and it cannot be transferred. Wacker Oil v. LoneTree Energy, 459 N.W.2d 381, 1990 N.D. LEXIS 163 (N.D. 1990).
Undivided Interest.
An undivided one-half interest in land is an interest in property capable of being mortgaged or transferred. Ruble v. Grafton Nat'l Bank, 64 N.D. 129, 250 N.W. 784, 1933 N.D. LEXIS 257 (N.D. 1933).
Law Reviews.
Estates in North Dakota, 30 N.D. L. Rev. 289 (1954).
Real Property, Future Interests, Mere Possibilities, Mode of Conveyance, 25 Bar Briefs, State Bar Ass’n of N.D. 124 (1949).
47-09-03. Voluntary transfer defined — Consideration unnecessary.
A voluntary transfer is an executed contract, subject to all rules of law concerning contracts in general except that a consideration is not necessary to its validity.
Source:
Civ. C. 1877, § 600; R.C. 1895, § 3509; R.C. 1899, § 3509; R.C. 1905, § 4946; C.L. 1913, § 5489; R.C. 1943, § 47-0903.
Derivation:
Cal. Civ. C., 1040.
Notes to Decisions
Bill of Sale.
Where husband desires to give his personal property to his wife, the execution and delivery of a bill of sale thereof is equivalent to a delivery of the property itself. Lenihan v. Meyer, 111 N.W.2d 696, 1961 N.D. LEXIS 101 (N.D. 1961).
Deed of Real Estate.
Where the owner of real estate executes and delivers a voluntary transfer of such property in the form of a deed, done in good faith and as grantor, such deed transfers all of the title of the grantor therein to his grantee and such voluntary transfer needs no consideration to be sustained. Arhart v. Thompson, 75 N.D. 189, 26 N.W.2d 523, 1947 N.D. LEXIS 58 (N.D. 1947).
Where an aged, widowed mother executes and delivers to her only son a deed to all her real property, reserving in herself a life estate, and it appears in the evidence in an action to set aside the deed that the mother had a change of mind after the transaction was completed, equity does not require that the deed be set aside for failure of consideration. Young v. Smith, 191 N.W.2d 516, 1971 N.D. LEXIS 111, 1971 N.D. LEXIS 127 (N.D. 1971).
47-09-04. Transfer — How made.
A transfer may be made without writing in every case in which a writing is not required expressly by statute.
Source:
Civ. C. 1877, § 604; R.C. 1895, § 3513; R.C. 1899, § 3513; R.C. 1905, § 4950; C.L. 1913, § 5493; R.C. 1943, § 47-0904.
Derivation:
Cal. Civ. C., 1052.
Cross-References.
Contracts which must be in writing, see N.D.C.C. § 9-06-04.
Real estate transfers, writing required, see N.D.C.C. § 47-10-01.
Uniform Commercial Code, personalty other than goods and securities, statute of frauds, see § 41-01-16.
Uniform Commercial Code — Sales, statute of frauds, see N.D.C.C. §§ 41-02-08, 41-02-16, 41-02-43.
Uniform Commercial Code — Securities, statute of frauds, see N.D.C.C. § 41-08-13.
Notes to Decisions
Chose in Action.
A chose in action may be transferred either by parol or by written assignment. Roberts v. First Nat'l Bank, 8 N.D. 474, 79 N.W. 993, 1899 N.D. LEXIS 38 (N.D. 1899).
47-09-05. Names of transfers by writing.
A transfer in writing is called a grant, or conveyance, or bill of sale. The term “grant” in this title includes all these instruments unless it is specially applied to real property.
Source:
Civ. C. 1877, § 605; R.C. 1895, § 3514; R.C. 1899, § 3514; R.C. 1905, § 4951; C.L. 1913, § 5494; R.C. 1943, § 47-0905.
Derivation:
Cal. Civ. C., 1053.
Notes to Decisions
Grant.
A transfer, as applied to real estate, is termed a grant. North Dakota Horse & Cattle Co. v. Serumgard, 17 N.D. 466, 117 N.W. 453, 1908 N.D. LEXIS 71 (N.D. 1908).
The assignment of an oil and gas royalty in writing is a grant. Corbett v. La Bere, 68 N.W.2d 211, 1955 N.D. LEXIS 88 (N.D. 1955).
47-09-06. Delivery of written transfer — Requirement — Presumption from execution.
A grant takes effect so as to vest the interest intended to be transferred only upon its delivery by the grantor and is presumed to have been delivered at its date.
Source:
Civ. C. 1877, §§ 606, 607; R.C. 1895, §§ 3515, 3516; R.C. 1899, §§ 3515, 3516; R.C. 1905, §§ 4952, 4953; C.L. 1913, §§ 5495, 5496; R.C. 1943, § 47-0906.
Derivation:
Cal. Civ. C., 1054, 1055.
Notes to Decisions
- Acceptance by Grantee.
- Acceptance of Deed.
- Burden of Proof.
- Delivery by Recordation.
- Delivery Required.
- Failure to Record.
- Incomplete Deed.
- Intention of Grantor.
- Leasehold Interest.
- Presumption of Delivery.
- Quitclaim Deed.
- Vesting of Title.
Acceptance by Grantee.
Although conveyance by deed takes effect upon delivery of the deed by the grantor, it is well settled that “acceptance by the grantee is an essential part of a delivery”. CUNA Mortgage v. Aafedt, 459 N.W.2d 801, 1990 N.D. LEXIS 164 (N.D. 1990).
The recording of a deed may create a rebuttable presumption of its delivery to, and its acceptance by, the grantee, and a failure to renounce a deed after knowledge of its existence may also in some circumstances be sufficient to show that a grantee accepted the deed. However, presumptions of acceptance arise only when the deed is beneficial to the grantee, not when the deed places a burden on the grantee. CUNA Mortgage v. Aafedt, 459 N.W.2d 801, 1990 N.D. LEXIS 164 (N.D. 1990).
Acceptance of Deed.
Where debtor recorded a deed in which he conveyed mortgaged home back to mortgage company in order to avoid foreclosure, mortgage company did not “constructively accept” the deed by failing to object to the deed for four weeks. Debtor had been told that deed would not be accepted, but recorded deed anyway. Nor did delay in objecting raise issues of laches, estoppel, or presumption of acceptance. CUNA Mortgage v. Aafedt, 459 N.W.2d 801, 1990 N.D. LEXIS 164 (N.D. 1990).
Burden of Proof.
The burden is upon the grantee to prove delivery. Black v. Black, 58 N.D. 501, 226 N.W. 485, 1929 N.D. LEXIS 244 (N.D. 1929).
Delivery by Recordation.
Trial court’s finding, in effect, that recording deed to husband and wife from wife’s father in the Register of Deeds [now Recorder] office constituted delivery of the deed sufficient to transfer the title of land described therein was not clearly erroneous. Thus, it was proper for the trial court to consider the land described therein as property within marital estate and subject to distribution in divorce, even though the wife claimed the parties did not own the land because there was no delivery of the deed. Dinius v. Dinius, 448 N.W.2d 210, 1989 N.D. LEXIS 220 (N.D. 1989).
Under North Dakota law, an interest transferred by a deed does not vest until there is delivery of the deed, and absent a delivery of a deed, the deed is of no effect. It is true, however, that the recording of a deed may create a rebuttable presumption of its delivery to, and its acceptance by, the grantee. Doeling v. Berger (In re Berger), 497 B.R. 47, 2013 Bankr. LEXIS 3023 (Bankr. D.N.D. 2013).
Delivery Required.
No title passes under a deed unless there is either an actual or constructive delivery thereof. McManus v. Commow, 10 N.D. 340, 87 N.W. 8, 1901 N.D. LEXIS 40 (N.D. 1901).
A deed is of no effect unless it is delivered. Eide v. Tveter, 143 F. Supp. 665, 1956 U.S. Dist. LEXIS 3012 (D.N.D. 1956).
The interest transferred by a deed does not vest until there is a delivery of the deed. Jorgensen v. Crow, 466 N.W.2d 120, 1991 N.D. LEXIS 8 (N.D. 1991).
District court properly quieted title to real property in a grandmother because “delivery” was not statutorily presumed and the grandson failed to establish the deeds at issue were delivered inasmuch as the grandmother's attorney was not acting as the grandson's attorney, the deeds were neither actually nor constructively delivered, the grandmother had dominion or control over the deeds through her attorney, the attorney was not a stranger to the grandmother, and the deeds held by the attorney were not constructively delivered to the grandson. Rice v. Neether, 2016 ND 247, 888 N.W.2d 749, 2016 N.D. LEXIS 237 (N.D. 2016).
District court erred in entering a judgment quieting title to the disputed royalty interest in defendants because, although defendants testified that they did not intend to convey a royalty interest, they could not otherwise explain how plaintiffs obtained the royalty deed conveying a one-twelfth royalty interest in minerals to plaintiffs; defendants only provided speculative testimony that delivery to plaintiffs might have been accidental; and defendants failed to rebut with clear and convincing evidence the presumption that the royalty deed was delivered to and accepted by plaintiffs. Trulson v. Meiers, 2019 ND 243, 933 N.W.2d 922, 2019 N.D. LEXIS 241 (N.D. 2019).
Failure to Record.
Where a delivery of a deed is made unconditionally, the fact that the deed was not recorded until after death of the grantor does not affect the title. McGuigan v. Heuer, 66 N.D. 710, 268 N.W. 679, 1936 N.D. LEXIS 218 (N.D. 1936).
Incomplete Deed.
A deed delivered with the name of the grantee blank, and with no proper authorization shown to fill in the grantee’s name, is void on its face. Brugman v. Charlson, 44 N.D. 114, 171 N.W. 882, 1919 N.D. LEXIS 193 (N.D. 1919).
Intention of Grantor.
Whether there was a delivery of a deed depends upon the intention of the grantor. McGuigan v. Heuer, 66 N.D. 710, 268 N.W. 679, 1936 N.D. LEXIS 218 (N.D. 1936).
Words or conduct of the grantor evidencing his intention to render his deed presently operative and effectual so as to vest the estate in the grantee, and to surrender control over the title are necessary and sufficient to constitute a valid delivery. Eide v. Tveter, 143 F. Supp. 665, 1956 U.S. Dist. LEXIS 3012 (D.N.D. 1956).
Leasehold Interest.
Since an oil and gas lease is a transfer of an interest in real estate, an assignment of such lease also is a transfer of an interest in real estate and takes effect only on its delivery. Mar Win Dev. Co. v. Wilson, 104 N.W.2d 369, 1960 N.D. LEXIS 79 (N.D. 1960).
Presumption of Delivery.
It is presumed that a deed was delivered to the grantee on the day of its date and its date is presumed to be the true date. Leonard v. Fleming, 13 N.D. 629, 102 N.W. 308, 1905 N.D. LEXIS 2 (N.D. 1905); McMillen v. Chamberland, 71 N.D. 65, 298 N.W. 767, 1941 N.D. LEXIS 137 (N.D. 1941).
Clear and convincing evidence must be produced to rebut the presumption of the delivery of a deed to or ownership of an instrument by a grantee in whose possession the deed is retained. Cox v. McLean, 66 N.D. 696, 268 N.W. 686, 1936 N.D. LEXIS 216 (N.D. 1936).
The execution and recording of a deed creates a presumption of sufficient delivery and fixes the time when the deed becomes effective. Eide v. Tveter, 143 F. Supp. 665, 1956 U.S. Dist. LEXIS 3012 (D.N.D. 1956).
Quitclaim Deed.
Grantors’ physically handing quitclaim deed to grantee in attorney’s office effected absolute delivery of deed, passing title immediately in accordance with the terms of the deed. Bolyea v. First Presbyterian Church, 196 N.W.2d 149, 1972 N.D. LEXIS 162 (N.D. 1972).
Vesting of Title.
The delivery of a deed which has been knowingly executed with the intention of transferring title completes the transaction so far as the title is concerned, and vests title in the grantee. NORD v. NORD, 68 N.D. 560, 282 N.W. 507, 1938 N.D. LEXIS 147 (N.D. 1938).
The interest transferred to a grantee by a deed does not vest until there is a delivery of the deed by the grantor and acceptance of the deed by the grantee; a deed is of no effect unless it is delivered but, delivery is of no avail unless the grantor effectuates it with the intent that the deed presently pass title to the grantee. In re Estate of Dittus, 497 N.W.2d 415, 1993 N.D. LEXIS 41 (N.D. 1993).
Although the debtors provided extrinsic evidence indicating that a quitclaim deed between them and the lender was not intended to be an actual transfer of ownership, extrinsic evidence could not be considered under the parol evidence rule because the delivered and recorded deed clearly and unambiguously conveyed all of the debtors' right, title, and interest in the property to the lender. Finstad v. Gord, 2014 ND 72, 844 N.W.2d 913, 2014 N.D. LEXIS 74 (N.D. 2014).
47-09-07. Delivery must be absolute — Conditional delivery ineffective, becomes absolute.
A grant cannot be delivered to the grantee conditionally. Delivery to the grantee or to the grantee’s agent as such is necessarily absolute and the instrument takes effect thereupon, discharged of any condition on which the delivery was made.
Source:
Civ. C. 1877, § 608; R.C. 1895, § 3517; R.C. 1899, § 3517; R.C. 1905, § 4954; C.L. 1913, § 5497; R.C. 1943, § 47-0907.
Derivation:
Cal. Civ. C., 1056.
Notes to Decisions
- Acknowledgment of Instrument.
- Condition Precedent in Written Contract for Sale Void.
- Mortgage.
- Rebuttal of Presumption.
- Return of Deed.
- Sufficiency of Delivery.
Acknowledgment of Instrument.
To make transfer of real property by a deed valid as between the grantor and grantee, it is not necessary that the instrument be acknowledged. Bumann v. Burleigh County, 73 N.D. 655, 18 N.W.2d 10, 1945 N.D. LEXIS 82 (N.D. 1945).
Condition Precedent in Written Contract for Sale Void.
Title to mineral rights was transferred to the grantee as of the date of the manual delivery by the grantor and manual acceptance by the grantee of the mineral deeds notwithstanding provisions in the contract for sale providing that grantee was not to issue the consideration for such conveyance until he was satisfied that grantor’s title was acceptable, and that grantee would not claim ownership of the mineral interests until after such consideration (in the form of corporate stock) had been issued to grantor. Adams v. Little Mo. Minerals Ass'n, 143 N.W.2d 659, 1966 N.D. LEXIS 179 (N.D. 1966).
Mortgage.
A mortgage takes effect on its delivery free from any condition upon which the delivery was made. Sargent v. Cooley, 12 N.D. 1, 94 N.W. 576, 1902 N.D. LEXIS 6 (N.D. 1902).
Rebuttal of Presumption.
Clear and convincing evidence must be produced to rebut the presumption of the delivery of a deed to or ownership of an instrument by a grantee in whose possession the deed is retained. Cox v. McLean, 66 N.D. 696, 268 N.W. 686, 1936 N.D. LEXIS 216 (N.D. 1936).
Return of Deed.
If a deed has once been delivered, its return to the grantor for safekeeping or some other specific purpose does not destroy the effect of the delivery. Keefe v. Fitzgerald, 69 N.D. 481, 288 N.W. 213, 1939 N.D. LEXIS 176 (N.D. 1939).
Sufficiency of Delivery.
Where plaintiffs executed deed and placed it in the hands of agent of defendant for delivery pursuant to an agreement that agent should have the right to demand from his principal as a condition precedent to such delivery, that the principal should procure a deed to the agent for other land, plaintiff’s deed, having been delivered to defendant without the performance of such condition precedent, passed title, as it was incompetent for the agent to make any agreement securing a benefit for himself adverse to his employers’ interests. Holt v. Colton, 22 N.W. 495, 4 Dakota 67, 1885 Dakota LEXIS 4 (Dakota 1885).
If the grantor makes a manual delivery to the grantee of a deed absolute in form, intending to part with all authority and dominion over the instrument, the delivery is absolute and title passes immediately in accordance with the terms of the deed, notwithstanding any intention or understanding to the contrary between the parties. Ueland v. More Bros., 22 N.D. 283, 133 N.W. 543, 1911 N.D. LEXIS 45 (N.D. 1911); Anderson v. Overby, 46 N.D. 631, 180 N.W. 708, 1920 N.D. LEXIS 67 (N.D. 1920); NORD v. NORD, 68 N.D. 560, 282 N.W. 507, 1938 N.D. LEXIS 147 (N.D. 1938); Keefe v. Fitzgerald, 69 N.D. 481, 288 N.W. 213, 1939 N.D. LEXIS 176 (N.D. 1939); McMillen v. Chamberland, 71 N.D. 65, 298 N.W. 767, 1941 N.D. LEXIS 137 (N.D. 1941); Arhart v. Thompson, 75 N.D. 189, 26 N.W.2d 523, 1947 N.D. LEXIS 58 (N.D. 1947); Shuck v. Shuck, 77 N.D. 628, 44 N.W.2d 767, 1950 N.D. LEXIS 158 (N.D. 1950); Accola v. Miller, 76 N.W.2d 517, 1956 N.D. LEXIS 116, 1956 N.D. LEXIS 117 (N.D. 1956).
Where a grantee does not record a deed nor take possession of the land until after the decease of the grantor, and there is evidence that she had in mind a secret purpose to give back the title to the grantor in case he should survive the grantee, the deed nevertheless was absolute in the light of positive testimony to that effect. Cale v. Way, 46 N.D. 558, 179 N.W. 921, 1920 N.D. LEXIS 45 (N.D. 1920).
A deed given by a husband to his wife for cancellation of the husband’s debt to her father, and given by the wife to her father for safekeeping, is sufficiently delivered and founded on a good consideration. State Bank v. Newell, 55 N.D. 184, 212 N.W. 848, 1927 N.D. LEXIS 21 (N.D. 1927).
It is essential to a valid delivery that there be some act or declaration from which an intention to pass title may be inferred, and this is true although the grantee is of very immature years. Shuck v. Shuck, 77 N.D. 628, 44 N.W.2d 767, 1950 N.D. LEXIS 158 (N.D. 1950).
Whether there was a delivery of a deed depends upon the intention of the grantor. McGuigan v. Heuer, 66 N.D. 710, 268 N.W. 679, 1936 N.D. LEXIS 218 (N.D. 1936).
Where the individuals claimed title through a series of quitclaim deeds, the judgment quieting title in the owner was affirmed; this section did not apply in that the delivery of the deed was not conditional. Valley Honey Co., LLC v. Graves, 2003 ND 125, 666 N.W.2d 453, 2003 N.D. LEXIS 138 (N.D. 2003), cert. denied, 540 U.S. 1165, 124 S. Ct. 1179, 157 L. Ed. 2d 1212, 2004 U.S. LEXIS 900 (U.S. 2004).
Although the debtors provided extrinsic evidence indicating that a quitclaim deed between them and the lender was not intended to be an actual transfer of ownership, extrinsic evidence could not be considered under the parol evidence rule because the delivered and recorded deed clearly and unambiguously conveyed all of the debtors' right, title, and interest in the property to the lender. Finstad v. Gord, 2014 ND 72, 844 N.W.2d 913, 2014 N.D. LEXIS 74 (N.D. 2014).
47-09-08. Delivery in escrow.
A grant may be deposited by the grantor with a third person to be delivered on the performance of a condition, and on delivery by the depositary it will take effect. While in the possession of the third person and subject to condition, it is called an escrow.
Source:
Civ. C. 1877, § 609; R.C. 1895, § 3518; R.C. 1899, § 3518; R.C. 1905, § 4955; C.L. 1913, § 5498; R.C. 1943, § 47-0908.
Derivation:
Cal. Civ. C., 1057.
Notes to Decisions
- Creating the Escrow.
- Effect of Placing Document in Escrow.
- Interest of Agent.
- Subjects of Escrow.
- Termination of Escrow.
Creating the Escrow.
The placing by the parties thereto of a promissory note in the hands of a third party with instructions not to deliver the same until directed to do so by the maker did not constitute an escrow. Nichols & Shepard Co. v. First Nat'l Bank, 6 N.D. 404, 71 N.W. 135, 1897 N.D. LEXIS 12 (N.D. 1897).
An escrow of a grant can only be created by delivery to a third person and not by delivery to the grantee. Johnson v. Weldy, 79 N.D. 80, 54 N.W.2d 829, 1952 N.D. LEXIS 100 (N.D. 1952); Kunick v. Trout, 85 N.W.2d 438, 1957 N.D. LEXIS 153 (N.D. 1957).
A valid escrow may be made by oral agreement and its existence may, at least in part, be shown by circumstances and conduct indicating the intention of the parties. Ganser v. Zimmerman, 80 N.W.2d 828, 1956 N.D. LEXIS 172 (N.D. 1956); Kunick v. Trout, 85 N.W.2d 438, 1957 N.D. LEXIS 153 (N.D. 1957).
Effect of Placing Document in Escrow.
A document placed in escrow is simply left to await the happening of some event or fulfillment of a condition the performance of which rests entirely with the other party and the grantor or maker cannot recall the escrow nor control the document. Nichols & Shepard Co. v. First Nat'l Bank, 6 N.D. 404, 71 N.W. 135, 1897 N.D. LEXIS 12 (N.D. 1897); Kunick v. Trout, 85 N.W.2d 438, 1957 N.D. LEXIS 153 (N.D. 1957).
Interest of Agent.
The escrow agent cannot gain a personal interest in the transaction by imposing a condition upon delivery which inures to his own benefit, where the grantor has not likewise imposed such a condition precedent to delivery. Holt v. Colton, 22 N.W. 495, 4 Dakota 67, 1885 Dakota LEXIS 4 (Dakota 1885).
Subjects of Escrow.
An escrow agreement may apply to mortgages or other instruments deposited upon conditions similar to those prevailing in the escrow of deeds. Ganser v. Zimmerman, 80 N.W.2d 828, 1956 N.D. LEXIS 172 (N.D. 1956).
Termination of Escrow.
The death of a grantor while his deed is held in escrow does not invalidate the instrument and it may be subsequently delivered upon compliance by the grantee with the conditions of the escrow agreement or upon the happening of the contingency upon which valid delivery depends. Ganser v. Zimmerman, 80 N.W.2d 828, 1956 N.D. LEXIS 172 (N.D. 1956).
Time is not of the essence of an escrow agreement unless so specified, and if no time is specified performance should be had within a reasonable time unless such time of performance has been waived. Ganser v. Zimmerman, 80 N.W.2d 828, 1956 N.D. LEXIS 172 (N.D. 1956).
Collateral References.
Loss resulting from defaults or peculations of escrow holder, who must bear, 15 A.L.R.2d 870.
Interest: rights as between vendor and vendee under land contract in respect of interest as affected by deposit in escrow, 25 A.L.R.2d 951, 975.
Mortgage payments: rights in funds representing “escrow” payments made by mortgagor in advance to cover taxes or insurance, 50 A.L.R.3d 697.
47-09-09. Constructive delivery.
Though a grant is not actually delivered into the possession of the grantee, it is yet to be deemed constructively delivered in the following cases:
- When, by the agreement of the parties, the instrument is understood to be delivered at the time of execution and the circumstances are such that the grantee is entitled to immediate delivery; or
- When it is delivered to a stranger for the benefit of a grantee and the grantee’s assent is shown or may be presumed.
Source:
Civ. C. 1877, § 611; R.C. 1895, § 3520; R.C. 1899, § 3520; R.C. 1905, § 4957; C.L. 1913, § 5500; R.C. 1943, § 47-0909.
Derivation:
Cal. Civ. C., 1059.
Notes to Decisions
- Acceptance by Minor.
- Burden of Proof.
- Date of Acceptance.
- Delivery by Recordation.
- Delivery to Agent.
- Insufficient Delivery.
- Intention of Grantor.
- Life Estate in Grantor.
- Question of Fact.
Acceptance by Minor.
In order to have valid constructive delivery of a deed to a minor, there must be an agreement between the grantor and the guardian of the minor so as to entitle the grantee to an immediate delivery. McManus v. Commow, 10 N.D. 340, 87 N.W. 8, 1901 N.D. LEXIS 40 (N.D. 1901); Shuck v. Shuck, 77 N.D. 628, 44 N.W.2d 767, 1950 N.D. LEXIS 158 (N.D. 1950).
Burden of Proof.
A grantee who asserts title has the burden of proving a constructive delivery. Magoffin v. Watros, 45 N.D. 406, 178 N.W. 134, 1920 N.D. LEXIS 138 (N.D. 1920); Black v. Black, 58 N.D. 501, 226 N.W. 485, 1929 N.D. LEXIS 244 (N.D. 1929).
Date of Acceptance.
If the grantee in a deed, after learning that the deed had been delivered to a stranger for his benefit, accepts the same, such acceptance relates back to the time of the original delivery. Arnegaard v. Arnegaard, 7 N.D. 475, 75 N.W. 797, 1898 N.D. LEXIS 90 (N.D. 1898).
Delivery by Recordation.
Trial court’s finding, in effect, that recording deed to husband and wife from wife’s father in the Register of Deeds [now Recorder] office constituted delivery of the deed sufficient to transfer the title of land described therein was not clearly erroneous. Thus, it was proper for the trial court to consider the land described therein as property within marital estate and subject to distribution in divorce, even though the wife claimed the parties did not own the land because there was no delivery of the deed. Dinius v. Dinius, 448 N.W.2d 210, 1989 N.D. LEXIS 220 (N.D. 1989).
Delivery to Agent.
When the grantor shows that he parts with all control of the deed and leaves it with a third person as the agent of the grantee, the delivery is effected. McGuigan v. Heuer, 66 N.D. 710, 268 N.W. 679, 1936 N.D. LEXIS 218 (N.D. 1936).
Insufficient Delivery.
A deed left among other papers, with a letter showing an intention that the land described should go to the grantee on the death of the grantor, is not a constructive delivery. Black v. Black, 58 N.D. 501, 226 N.W. 485, 1929 N.D. LEXIS 244 (N.D. 1929).
There was no constructive delivery of the deed where grantor executed the deed without the knowledge of the grantee, retained possession of the deed in his bank box, retained possession of the keys to the bank box, and paid taxes on the land described in the deed until his death. First Nat'l Bank v. Bloom, 264 N.W.2d 208, 1978 N.D. LEXIS 241 (N.D. 1978).
Intention of Grantor.
An indispensable element to be considered in determining whether a deed has been delivered is the intention of the grantor. Stark County v. Koch, 107 N.W.2d 701, 1961 N.D. LEXIS 64 (N.D. 1961).
Where there was no evidence grantor intended to part with dominion and control of deeds in favor of grantees or to vest title to property in grantees there was no constructive delivery under this section. Frederick v. Frederick, 178 N.W.2d 834, 1970 N.D. LEXIS 91 (N.D. 1970).
Life Estate in Grantor.
If a deed is delivered to a third person to be delivered to the grantee on the death of the grantor, such delivery transfers the title to the grantee, subject to the life interest of the grantor in the land. Arnegaard v. Arnegaard, 7 N.D. 475, 75 N.W. 797, 1898 N.D. LEXIS 90 (N.D. 1898); Silbernagel v. Silbernagel, 79 N.D. 275, 55 N.W.2d 713, 1952 N.D. LEXIS 120 (N.D. 1952).
Question of Fact.
The question of constructive delivery of deeds to grantee named therein was a question of fact where the deeds were executed by grantee’s mother and left with bank with a statement that the grantor wanted the deeds recorded if anything happened to her. Magoffin v. Watros, 45 N.D. 406, 178 N.W. 134, 1920 N.D. LEXIS 138 (N.D. 1920).
Whether or not there was actual or constructive delivery of a deed is a question of fact. Thus, the findings of fact of the district court that there was actual or constructive delivery of a deed will be upheld by the supreme court unless it concludes that these findings are clearly erroneous. Dinius v. Dinius, 448 N.W.2d 210, 1989 N.D. LEXIS 220 (N.D. 1989).
Collateral References.
Sufficiency of delivery of deed where grantor retains, or recovers, physical possession, 87 A.L.R.2d 787.
47-09-10. Redelivery does not retransfer.
Redelivering a grant of real property to the grantor, or canceling it, does not operate to retransfer the title.
Source:
Civ. C. 1877, § 610; R.C. 1895, § 3519; R.C. 1899, § 3519; R.C. 1905, § 4956; C.L. 1913, § 5499; R.C. 1943, § 47-0910.
Derivation:
Cal. Civ. C., 1058.
Notes to Decisions
Destruction or Redelivery.
The destruction of an unrecorded but delivered deed does not divest the title of the grantee and revest it in the grantor. Russell v. Meyer, 7 N.D. 335, 75 N.W. 262, 1898 N.D. LEXIS 71 (N.D. 1898).
Where a grantor has deposited a deed with a third person to be delivered to the grantee after the death of the grantor, he cannot subsequently, by withdrawing or destroying the deed, affect a delivery thus completed. Silbernagel v. Silbernagel, 79 N.D. 275, 55 N.W.2d 713, 1952 N.D. LEXIS 120 (N.D. 1952).
Redelivering a deed of real property to the grantor does not operate to retransfer the legal title, nor is such retransfer effected by the destruction of the redelivered deed by the grantor. Kuntz v. Partridge, 65 N.W.2d 681, 1954 N.D. LEXIS 99 (N.D. 1954).
Immediate return of deed to the grantor may be considered as a circumstance bearing upon the question of whether or not the deed was delivered. Eide v. Tveter, 143 F. Supp. 665, 1956 U.S. Dist. LEXIS 3012 (D.N.D. 1956).
47-09-11. Interpretation of grants.
Grants shall be interpreted in like manner with contracts in general except so far as is otherwise provided by this chapter. If the operative words of a grant are doubtful, recourse may be had to its recitals to assist the construction, and if several parts of a grant are absolutely irreconcilable, the former part shall prevail. A clear and distinct limitation in a grant is not controlled by other words less clear and distinct.
Source:
Civ. C. 1877, §§ 612 to 614, 616; R.C. 1895, §§ 3521 to 3523, 3525; R.C. 1899, §§ 3521 to 3523, 3525; R.C. 1905, §§ 4958 to 4960, 4962; C.L. 1913, §§ 5501 to 5503, 5505; R.C. 1943, § 47-0911.
Derivation:
Cal. Civ. C., 1066 to 1068, 1070.
Cross-References.
Covenants implied from use of word “grant” in real estate conveyances, see N.D.C.C. § 47-10-19.
Interpretation of contracts, see N.D.C.C. ch. 9-07.
Notes to Decisions
- Easement.
- Extrinsic Evidence.
- Intent of Parties.
- Language of Deed.
- Leases.
- Reservations and Exceptions.
Easement.
Summary judgment was properly entered against appellant in a case alleging trespass and other causes of action because a 1953 permit issued to another constituted an easement, rather than a license, since it was not revocable at the will of a landowner; under N.D.C.C. § 47-10-11, a transfer of real property passed all easements, but a license was generally not assignable. Moreover, N.D.C.C. § 47-05-02.1(1) only applied to easements that became binding after July 1, 1977. Riverwood Commer. Park, LLC v. Std. Oil Co., 2011 ND 95, 797 N.W.2d 770, 2011 N.D. LEXIS 95 (N.D. 2011).
April 2007 pipeline easement was ambiguous, and the district court erred in construing the easement as a matter of law. However, the district court did not err in ruling that an energy company's use of plaintiff's private road to access a second pipeline on plaintiffs' land was not authorized by a 2008 road use agreement and was a trespass. Krenz v. XTO Energy, Inc., 2017 ND 19, 890 N.W.2d 222, 2017 N.D. LEXIS 32 (N.D. 2017).
Present use of a lane that was built on plaintiffs' property was consistent with the scope of an easement granted for highway purposes. Evidence supported that the lane was constructed to alleviate safety concerns because of congestion due to trucks waiting on the highway to access an oil-truck offloading facility. Ceynar v. Tesoro Logistics LP, 2017 ND 112, 894 N.W.2d 374, 2017 N.D. LEXIS 111 (N.D. 2017).
Extrinsic Evidence.
Where deeds conveying land and mineral interests were ambiguous as to parties’ intent concerning the estate in the mineral rights conveyed, trial court properly permitted use of an unrecorded land-purchase agreement to explain parties’ intent as to the mineral estate to be conveyed. Schulz v. Hauck, 312 N.W.2d 360, 1981 N.D. LEXIS 413 (N.D. 1981).
Intent of Parties.
Deeds are interpreted to ascertain and effectuate the parties’ mutual intentions. Stracka v. Peterson, 377 N.W.2d 580, 1985 N.D. LEXIS 442 (N.D. 1985).
Primary purpose in construing deed is to ascertain and effectuate intent of grantor even though principles of contract law guide inquiry. United States v. Johansen, 93 F.3d 459, 1996 U.S. App. LEXIS 20640 (8th Cir. N.D. 1996).
Language of Deed.
The language in the deed, if clear and explicit, shall govern the interpretation, and the parties’ intentions should be ascertained from the language alone, if possible. Royse v. Easter Seal Soc'y for Crippled Children & Adults, 256 N.W.2d 542, 1977 N.D. LEXIS 147 (N.D. 1977).
Insertion of the word “Royalty” in a printed deed form suited to the conveyance of a mineral interest created an ambiguity because rational contrary arguments could be made as to the meaning of the language in question. The grantor’s ambiguously expressed intentions were questions of fact to be determined with the aid of extrinsic evidence. Williams Co. v. Hamilton, 427 N.W.2d 822, 1988 N.D. LEXIS 191 (N.D. 1988).
District court erred in ruling as a matter of law that a railroad acquired only an easement under five separate deeds where the deeds unambiguously conveyed land, warranted title, and did not use any words limiting the grant, and no other provisions or language created ambiguity. EOG Res., Inc. v. Soo Line R.R. Co., 2015 ND 187, 867 N.W.2d 308, 2015 N.D. LEXIS 202 (N.D. 2015).
District court erred in ruling that the railroad acquired only an easement under a deed with a slightly different property description where the deed conveyed a strip, piece, or parcel of land to the railroad and included warranty and habendum clauses, and no other provisions or language limited the interest conveyed or created ambiguity in the type of interest conveyed. EOG Res., Inc. v. Soo Line R.R. Co., 2015 ND 187, 867 N.W.2d 308, 2015 N.D. LEXIS 202 (N.D. 2015).
Granting summary judgment as to a deed containing a materially different property description was improper where reasonable differences of opinion existed as to the inferences to be drawn from the deed's language. EOG Res., Inc. v. Soo Line R.R. Co., 2015 ND 187, 867 N.W.2d 308, 2015 N.D. LEXIS 202 (N.D. 2015).
District court erred in holding an ambiguity existed in the right-of-way deeds where, rather than granting and conveying a strip, piece, parcel, or tract of land, the deeds explicitly stated that they granted a right of way through the specified land and specifically limited the purposes of the right of way for the laying out, construction, and maintenance of a public drain. Sargent Cnty. Water Res. Dist. v. Mathews, 2015 ND 277, 871 N.W.2d 608, 2015 N.D. LEXIS 294 (N.D. 2015).
Leases.
Court interpreted grants of property in like manner with contracts and, therefore, the same reasoning applied to its interpretation of the lease. The designated acreage in an otherwise unambiguous lease was irrelevant in light of the specific description. Lario Oil & Gas Co. v. EOG Res., Inc., 2013 ND 98, 832 N.W.2d 49, 2013 N.D. LEXIS 93 (June 19, 2013).
Reservations and Exceptions.
Where the intent of the parties was that the conveyance was as to all of the premises “subject to” certain reservations and exceptions specifically referred to and the provision in question involved an interest thought to be in a third party, but later determined to be void and nonexistent, the provision did not exclude the nonexistent interest from the grant and was neither a reservation nor an exception of an interest by the grantor. United States v. McKenzie County, 187 F. Supp. 470, 1960 U.S. Dist. LEXIS 5105 (D.N.D. 1960), aff'd, 291 F.2d 161, 1961 U.S. App. LEXIS 4193 (8th Cir. N.D. 1961).
Collateral References.
Joining in subsequent instrument as ratification of prior ineffective deed, 7 A.L.R.2d 294.
Effect of supplying description of property conveyed after manual delivery of deed, 11 A.L.R.2d 1372.
“Offspring”: who are within gift or grant to “offspring”, 23 A.L.R.2d 842.
Effect on validity of instrument in form of deed of provisions therein indicating an intention to postpone or limit the rights of grantee until after the death of grantor, 31 A.L.R.2d 532.
Timber: sufficiency of description in exception or reservation as to standing timber, 35 A.L.R.2d 1422.
Written matter as controlling printed matter in construction of deed, 37 A.L.R.2d 820.
Habendum: conflict between granting and habendum clauses as to estate conveyed, 58 A.L.R.2d 1374.
Parol evidence: admissibility of parol evidence with respect to reservations or exceptions upon conveyance of real property, 61 A.L.R.2d 1390.
Boundaries: measurement in horizontal line or along surface or contour, 80 A.L.R.2d 1208.
Dwelling: meaning of terms “dwelling” or “dwelling house” or “house”, as used in the conveyance or exception or reservation clauses, 38 A.L.R.3d 1419.
Boundaries: description in deed as relating to magnetic or true meridian, 70 A.L.R.3d 1220.
Adopted child as within class named in deed or inter vivos trust instrument, 37 A.L.R.5th 237.
Law Reviews.
Deeds — Nature and Creation of Reservations — Reservation of a Property Interest in a Deed in Favor of the Grantor’s Spouse Is Effective When That Is the Grantor’s Intent, 60 N.D. L. Rev. 317 (1984).
47-09-12. Interpretation of descriptive words.
If any instrument relating to real or personal property shall be executed by or to any person as trustee, guardian, executor, administrator, or in any other representative capacity, and shall fail to identify clearly the beneficiary by name and the nature of the trust, the qualifying words in such instrument shall be treated as surplusage and as description only of the person by whom or to whom the instrument was executed.
Source:
S.L. 1917, ch. 239, § 1; 1925 Supp., § 5545a1; R.C. 1943, § 47-0912.
Notes to Decisions
Appellate Review.
In deciding ownership of mineral interests, the district court's findings about the existence of a resulting trust were not clearly erroneous. The district court properly considered the facts and circumstances of the case and found the use of the word “trustee” in the grant deed was evidence of an intent to create a trust at the time the property was conveyed. Markgraf v. Welker, 2017 ND 219, 902 N.W.2d 492, 2017 N.D. LEXIS 222 (N.D. 2017).
47-09-13. Grant shall be interpreted in favor of grantee — Exceptions.
A grant shall be interpreted in favor of the grantee, except that a reservation in any grant, and every grant by a public officer or body, as such, to a private party, is to be interpreted in favor of the grantor.
Source:
Civ. C. 1877, § 615; R.C. 1895, § 3524; R.C. 1899, § 3524; R.C. 1905, § 4961; C.L. 1913, § 5504; R.C. 1943, § 47-0913.
Derivation:
Cal. Civ. C., 1069.
Notes to Decisions
In General.
A grant executed by a private individual or corporation shall be interpreted in favor of the grantee, except that a reservation in a grant is to be interpreted in favor of the grantor. Corbett v. La Bere, 68 N.W.2d 211, 1955 N.D. LEXIS 88 (N.D. 1955).
Mineral Rights.
This section does not apply to the reservation of mineral rights under N.D.C.C. § 38-09-01. Salzseider v. Brunsdale, 94 N.W.2d 502, 1959 N.D. LEXIS 65 (N.D. 1959).
A grant [without a reservation] shall be interpreted in favor of the grantee and a conveyance of land, without any exception or reservation of the minerals constitutes a conveyance of 100 percent of the minerals as well as the surface. Acoma Oil Corp. v. Wilson, 471 N.W.2d 476, 1991 N.D. LEXIS 105 (N.D. 1991).
When Rule Inapplicable.
The rule of construction provided in this section does not apply where the court determines that no ambiguity or uncertainty exists. Harding v. Trenor, 157 F. Supp. 350, 1957 U.S. Dist. LEXIS 2506 (D.N.D. 1957).
In a quiet title action involving quitclaim deeds executed in favor of a deceased property owner’s son, the son’s reliance on various statutory construction rules was misplaced because they were a last resort and were not applicable when there were other means for ascertaining intent in order to resolve the dispute. Rolla v. Tank, 2013 ND 175, 837 N.W.2d 907, 2013 N.D. LEXIS 178 (N.D. 2013).
Law Reviews.
“And Other Minerals” as Interpreted by the North Dakota Supreme Court, Robert E. Beck, 52 N.D. L. Rev. 633 (1976).
The Meaning of the Word “Minerals”, 54 N.D. L. Rev. 419 (1978).
47-09-14. Without issue defined.
When a future interest is limited by a grant to take effect on the death of any person without heirs, or heirs of the person’s body, without issue, or in equivalent words, such words must be taken to mean successors or issue living at the death of the person named as ancestor.
Source:
Civ. C. 1877, § 617; R.C. 1895, § 3526; R.C. 1899, § 3526; R.C. 1905, § 4963; C.L. 1913, § 5506; R.C. 1943, § 47-0914.
Derivation:
Cal. Civ. C., 1071.
47-09-15. Words of inheritance or succession unnecessary to fee.
Words of inheritance or succession shall not be requisite to transfer a fee in real property.
Source:
Civ. C. 1877, § 618; R.C. 1895, § 3527; R.C. 1899, § 3527; R.C. 1905, § 4964; C.L. 1913, § 5507; R.C. 1943, § 47-0915.
Derivation:
Cal. Civ. C., 1072.
47-09-16. Transfer vests actual title — Thing includes incidents.
A transfer vests in the transferee all the actual title to the thing transferred which the transferor then has unless a different intention is expressed or is necessarily implied. It also transfers all its incidents unless expressly excepted, but the transfer of an incident to a thing does not transfer the thing itself.
Source:
Civ. C. 1877, §§ 619, 620; R.C. 1895, §§ 3528, 3529; R.C. 1899, §§ 3528, 3529; R.C. 1905, §§ 4965, 4966; C.L. 1913, §§ 5508, 5509; R.C. 1943, § 47-0916.
Derivation:
Cal. Civ. C., 1083, 1084.
Notes to Decisions
Ambiguous Transfer Agreement.
Transfer of rental signs from a rental sign business to a sign company did not constitute a gift in light of an ambiguous transfer agreement, as extrinsic evidence tended to establish that the transfer document was not intended to give ownership interest in the signs to the company but to allow the company to use the signs; therefore, the trial court did not err in dismissing the sign company owner’s suit for conversion after the signs and letters were taken by the rental sign business. Doeden v. Stubstad, 2008 ND 165, 755 N.W.2d 859, 2008 N.D. LEXIS 165 (N.D. 2008).
Assignment.
An assignment of the principal carries with it all the incidents thereof. Clark v. Sullivan, 3 N.D. 280, 55 N.W. 733, 1893 N.D. LEXIS 24 (N.D. 1893).
Conveyance of Deed.
A deed passes whatever interest the grantor has in the land unless words are used to show an intent to convey a smaller estate. Acoma Oil Corp. v. Wilson, 471 N.W.2d 476, 1991 N.D. LEXIS 105 (N.D. 1991).
Grantees were not entitled to quiet title to property because the grantor’s interest in the land of the decedent’s estate was still subject to administration and the personal representative’s power over the estate property was superior to any title or interest of the grantees in the estate property, while the grantor had no claim to the land held by a trust as the trustee had sole authority to act on behalf of the trust. Hogen v. Hogen, 2019 ND 17, 921 N.W.2d 672, 2019 N.D. LEXIS 23 (N.D.), cert. denied, — U.S. —, 140 S. Ct. 119, 205 L. Ed. 2d 33, 2019 U.S. LEXIS 5366 (U.S. 2019).
Grant in Deed.
The grants in deeds are conclusive against the grantors unless grounds exist to reform those conveyances. Mau v. Schwan, 460 N.W.2d 131, 1990 N.D. LEXIS 180 (N.D. 1990).
A grantor who, by warranty deed, purports to convey a fractional mineral interest is estopped from asserting title to a reserved fractional mineral interest in contradiction to the interest purportedly conveyed; the key question is, not what the grantor purported to retain for himself, but what he purported to give to the grantee. If both grant and reservation cannot be given effect, the reservation must fail. Mau v. Schwan, 460 N.W.2d 131, 1990 N.D. LEXIS 180 (N.D. 1990).
Mortgage.
The holder of the legal title to real estate may mortgage the real estate between the act of sale on foreclosure under a power contained in the prior mortgage and the expiration of the period allowed by statute for redemption. North Dakota Horse & Cattle Co. v. Serumgard, 17 N.D. 466, 117 N.W. 453, 1908 N.D. LEXIS 71 (N.D. 1908).
47-09-17. Present interest and benefit — When taken.
A present interest and the benefit of a condition or covenant respecting property may be taken by any natural person under a grant although not named a party thereto.
Source:
Civ. C. 1877, § 621; R.C. 1895, § 3530; R.C. 1899, § 3530; R.C. 1905, § 4967; C.L. 1913, § 5510; R.C. 1943, § 47-0917.
Law Reviews.
Deeds — Nature and Creation of Reservations — Reservation of a Property Interest in a Deed in Favor of the Grantor’s Spouse Is Effective When That Is the Grantor’s Intent, 60 N.D. L. Rev. 317 (1984).
The Growing Uncertainty of Real Estate Titles, 65 N.D. L. Rev. 1 (1989).
47-09-18. Land transfers — Filing requirements. [Retroactive application — See note]
A transfer of land between any federal, state, or local governmental entities must have a deed with a proper legal description filed with the county recorder.
Source:
S.L. 2017, ch. 315, § 1, eff August 1, 2017.
Note.
Section 2 of chapter 315, S.L. 2017 provides, “ RETROACTIVE APPLICATION. This Act is retroactive in application.”
CHAPTER 47-10 Real Property Transfers
47-10-01. Method of transfer.
An estate in real property, other than an estate at will or for a term not exceeding one year, can be transferred only by operation of law or by an instrument in writing, subscribed by the party disposing of the same or by the party’s agent thereunto authorized by writing. This does not abridge the power of any court to compel the specific performance of any agreement for the sale of real property in case of part performance thereof.
Source:
Civ. C. 1877, §§ 622, 993; R.C. 1895, §§ 3531, 3960; R.C. 1899, §§ 3531, 3960; R.C. 1905, §§ 4968, 5407; C.L. 1913, §§ 5511, 5963; R.C. 1943, § 47-1001.
Derivation:
Cal. Civ. C., 1091, 1741.
Cross-References.
Contracts required to be in writing, see N.D.C.C. § 9-06-04.
Minor’s disability to contract relating to real property, see N.D.C.C. § 14-10-09.
Mortgage of real property, see N.D.C.C. ch. 35-03.
Transfer by corporation, see N.D.C.C. § 10-19.1-26 and 47-10-05.1.
Transfer by nonprofit corporation, see N.D.C.C. § 10-33-21.
Notes to Decisions
- Acknowledgment.
- Grantor’s signature.
- Brokerage Contract.
- Buildings.
- Contract by Agent.
- Grantee’s Name Left Blank in Deed.
- Homestead Property.
- Improvements.
- Memorandum of Oral Agreement.
- Oral Option Agreement.
- Oral Trust Agreement.
- Parol Gift of Land.
- Part Payment and Improvements.
- Part Performance.
- Pleading.
- Possession.
- Possession and Improvements.
- Railroad Lands.
- Scope of Statute.
- Successor in Interest.
Acknowledgment.
To make a transfer of real property by a deed valid as between the grantor and the grantee, it is not necessary that the instrument be acknowledged. Bumann v. Burleigh County, 73 N.D. 655, 18 N.W.2d 10, 1945 N.D. LEXIS 82 (N.D. 1945).
As between the parties, the fact that the deed is not acknowledged does not prevent it from operating as a transfer of real estate. Knoshaug v. Pollman, 148 F. Supp. 16, 1957 U.S. Dist. LEXIS 3967 (D.N.D.), aff'd, 245 F.2d 271, 1957 U.S. App. LEXIS 4833 (8th Cir. N.D. 1957).
Failure of grantor to re-sign and re-acknowledge a deed that was altered by the grantee rendered that deed null and void on its face. Neither grantee's proffered justifications for altering an exhibit to the purchase agreement before recording it nor the alteration's purported harmlessness excused his noncompliance with the rules governing grantors. Armstrong v. Berco Res., LLC, 752 F.3d 716, 2014 U.S. App. LEXIS 9030 (8th Cir. N.D. 2014).
Grantor’s signature.
District court did not err in determining that a warranty deed document failed to meet the statutory requirements because the court did not clearly err in finding that the type-written document did not contain the grantor’s signature. K.S. v. S.M.H. (In re Guardianship & Conservatorship of S.M.H.), 2021 ND 104, 960 N.W.2d 811, 2021 N.D. LEXIS 103 (N.D. 2021).
Brokerage Contract.
A mere brokerage contract, whereby real estate broker was to receive all over a certain sum in case he found a purchaser for property, was not a contract for the sale of the property in contravention of this section. Kepner v. Ford, 16 N.D. 50, 111 N.W. 619, 1907 N.D. LEXIS 19 (N.D. 1907).
Buildings.
An agreement for the sale of a large, frame livery barn, affixed to and a part of the real estate, the barn to be wrecked and the lumber removed thereafter at the convenience of the purchaser, was a contract for the sale of an interest in real property and could not be enforced unless made in writing. Baird v. Elliott, 63 N.D. 738, 249 N.W. 894, 1933 N.D. LEXIS 230 (N.D. 1933).
Contract by Agent.
A contract of an agent to sell property is void in the absence of written authority signed by the owner. Ballou v. Bergvendsen, 9 N.D. 285, 83 N.W. 10, 1900 N.D. LEXIS 226 (N.D. 1900).
To make valid a written contract for the sale of real property signed by an agent of the vendor, the agent must have authority in writing from the owner so to do. Brandrup v. Britten, 11 N.D. 376, 92 N.W. 453, 1902 N.D. LEXIS 227 (N.D. 1902).
The statute of frauds deals with contracts necessarily affecting the title and conveyance of real estate as between the parties to the contract and does not include a contract of agency whereby the agent is to bid in real estate in the name of the principal. Schmidt v. Beiseker, 14 N.D. 587, 105 N.W. 1102, 1905 N.D. LEXIS 92 (N.D. 1905).
A contract for the conveyance of land, executed by the party to be charged may be enforced even though the authority of the agent of the vendee who signed the contract was not given in writing. Merritt v. Adams County Land & Inv. Co., 29 N.D. 496, 151 N.W. 11, 1915 N.D. LEXIS 25 (N.D. 1915).
A written contract for the sale of land, entered into by an agent of the vendor who has only a parol authority to contract for the sale thereof, is void. Halland v. Johnson, 42 N.D. 360, 174 N.W. 874, 1919 N.D. LEXIS 188 (N.D. 1919).
This statute applies to sales of privately-owned real estate at public auction, but the auctioneer has the authority to make the required memorandum on behalf of both the bidder and vendor. Brey v. Tvedt, 74 N.D. 192, 21 N.W.2d 49, 1945 N.D. LEXIS 67 (N.D. 1945).
Rule voiding real estate sale entered into with purchaser by agent who has only verbal authority from owner was applicable even though purported agent was attorney; mere payment of money consideration by buyer generally is not sufficient justification for enforcing oral contract to convey land; acts relied upon as partial performance, to take an oral agreement out of statute of frauds, must be such as to be incomprehensible unless related to the contract; payment of taxes, partial payment of $3,000 mortgage and possession of premises by purchaser were consistent with his operation of land under his seven-eighths ownership of property and were insufficient to take alleged oral contract for sale of remaining one-eighth interest in property out of statute of frauds. Tostenson v. Ihland, 147 N.W.2d 104, 1966 N.D. LEXIS 152 (N.D. 1966).
Grantee’s Name Left Blank in Deed.
Deed form left blank, except for the signature of the grantor and an attached description of the property, delivered by grantor to the grantee along with verbal instructions for grantee to have an attorney insert the description of the property and grantee’s name in the deed, was a valid transfer between grantor and grantee when deed was delivered in blank to the grantee. Mehus v. Thompson, 266 N.W.2d 920, 1978 N.D. LEXIS 252 (N.D. 1978).
Homestead Property.
A conveyance of a homestead that is not executed and acknowledged by both husband and wife is void. Dixon v. Kaufman, 79 N.D. 633, 58 N.W.2d 797, 1953 N.D. LEXIS 69 (N.D. 1953); Neset v. Rudman, 74 N.W.2d 826, 1956 N.D. LEXIS 91 (N.D. 1956).
Improvements.
When improvements to property are relied upon as part performance of an oral contract for purposes of removing it from the statute of frauds, the improvements made on the land must be valuable, substantial, and permanent. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
Memorandum of Oral Agreement.
A memorandum need not be a completed contract to satisfy the statute of frauds and it is sufficient if it is merely written evidence of the contract. Hartman v. McNamara, 186 F. Supp. 293, 1960 U.S. Dist. LEXIS 3429 (D.N.D. 1960).
A letter which purported to recite the terms of an offer to purchase real estate and which was certified to by the vendor as correct was insufficient to satisfy the statute of frauds where the instrument was prepared and signed after the oral sale agreement had been abrogated. Hartman v. McNamara, 186 F. Supp. 293, 1960 U.S. Dist. LEXIS 3429 (D.N.D. 1960).
Oral Option Agreement.
District court erred in ruling that an alleged oral option agreement to purchase a lake home was enforceable under the statute of frauds where it made no findings about the terms of the alleged oral agreement, such as the amount of the lease payments, the length of the lease, or the manner in which the option to purchase was to be exercised, the alleged purchasers' payment of the owners' mortgage obligations, taxes and related expenses were as consistent with a simple lease as with a lease with an option to purchase, and the alleged purchasers' mere attempt to to exercise the option was insufficient to remove an oral agreement from the statute of frauds. Knorr v. Norberg, 2014 ND 74, 844 N.W.2d 919, 2014 N.D. LEXIS 75 (N.D. 2014).
Oral Trust Agreement.
An oral agreement of trust between record landowner and others to hold land is void. United States v. Heasley, 170 F. Supp. 738, 1959 U.S. Dist. LEXIS 3779 (D.N.D. 1959), rev'd, 274 F.2d 733, 1960 U.S. App. LEXIS 5555 (8th Cir. N.D. 1960).
Parol Gift of Land.
Trial court did not err in finding plaintiff acquired title to property through executed parol gift from his parents, and occupancy by adverse possession. Mertz v. Arendt, 1997 ND 113, 564 N.W.2d 294, 1997 N.D. LEXIS 106 (N.D. 1997).
Part Payment and Improvements.
Part payment of the purchase price and substantial improvements to the property may remove an oral contract from the statute of frauds and create an enforceable contract constituting an enforceable equitable property interest. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
Part Performance.
Partial performance of a parol agreement concerning the sale of real property takes the contract outside the statute of frauds and equity will enforce specific performance by the party claiming protection of the statute. Fideler v. Norton, 30 N.W. 128, 32 N.W. 57, 4 Dakota 258 (Dakota 1886).
Part payment of the purchase price under a verbal agreement of sale of real estate is not, in and of itself, sufficient to take the verbal agreement out of the statute of frauds. Henry S. Grinde Corp. v. Klindworth, 77 N.D. 597, 44 N.W.2d 417, 1950 N.D. LEXIS 155, 1950 N.D. LEXIS 156 (N.D. 1950).
Partial performance of a parol agreement to convey an interest in real property is sufficient to take the oral agreement out of the statute of frauds. Brandhagen v. Burt, 117 N.W.2d 696, 1962 N.D. LEXIS 94 (N.D. 1962).
In an action by husband and wife, owning building and lot as joint tenants, to quiet title to a portion of their lot upon which defendant’s building encroached, where plaintiff husband entered into an oral agreement with the defendant for use of plaintiffs’ wall as a party wall and for an easement to a strip of plaintiffs’ lot, and pursuant to such oral agreement, the plaintiff husband allowed the defendant to construct his building, using such strip, and attach his building to plaintiffs’ building, and defendant spent large sums of money in construction of his building and to pay for repairs to the party wall, there was sufficient partial performance by the defendant to take the oral agreement out of the statute of frauds as between plaintiff husband and defendant. Brandhagen v. Burt, 117 N.W.2d 696, 1962 N.D. LEXIS 94 (N.D. 1962).
In order to be sufficient to relieve an oral agreement for the sale of real estate from the effect of the statute of frauds, the acts relied upon as partial performance must be of such a nature as to be incomprehensible unless viewed in relation to the contract to convey an interest in land. Parceluk v. Knudtson, 139 N.W.2d 864, 1966 N.D. LEXIS 202 (N.D. 1966).
Standing alone, the payment of money consideration by the buyer generally is not sufficient justification for enforcing an oral contract for the conveyance of real estate. Parceluk v. Knudtson, 139 N.W.2d 864, 1966 N.D. LEXIS 202 (N.D. 1966).
Actions of purchaser did not constitute sufficient part performance to remove an oral contract for the sale of real property from the statute of frauds where there was a dispute as to the amount of the property to be sold and the actions were consistent with either disputed amount. Anderson v. Mooney, 279 N.W.2d 423, 1979 N.D. LEXIS 251 (N.D. 1979).
The general rule is that contracts for the sale of real property and transfers of real property interests must be made by an instrument in writing. However, part performance of an oral contract which is consistent only with the existence of the alleged contract removes it from the statute of frauds. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
While partial payment of the purchase price alone is not justification for enforcing an oral contract to convey land, partial payment together with other acts such as possession or the making of valuable improvements may be sufficient to take a contract out of the statute of frauds. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
The trial court erred in granting summary judgment in partnership’s action seeking specific performance of an oral agreement for the purchase of real property where the partnership raised genuine issues of material fact in support of its allegations of an oral contract and partial performance of that contract so as to remove it from the statute of frauds. Johnson Farms v. McEnroe, 1997 ND 179, 568 N.W.2d 920, 1997 N.D. LEXIS 197 (N.D. 1997).
Absent a written contract or agreement, N.D.C.C. § 47-10-01 allowed a court to compel the specific performance of any agreement for the sale of real property in case of part performance thereof; the improvements made by the tenants and relied upon by the trial court did not unmistakably point to the existence of the alleged oral contract and were more consistent with a lease without an option to purchase, such that the alleged oral contract was not removed from the statute of frauds because there was not partial performance consistent only with the existence of the alleged contract. Fladeland v. Gudbranson, 2004 ND 118, 681 N.W.2d 431, 2004 N.D. LEXIS 215 (N.D. 2004).
Trial court did not err in granting possession of land to the personal representative of a mother’s estate because a son failed to prove that he had an oral contract for deed to buy the land from his parents; the son failed to clearly and definitely prove payments made by him were for the purchase of the real estate and he failed to prove by clear and definite evidence the existence of an oral contract for the sale of land which possessed all the necessary elements and features of an enforceable agreement. Although the trial court’s findings about the existence of an oral agreement considered criteria relevant to the statute of frauds, N.D.C.C. § 9-06-04(3), and specific performance in the context of finding there was no contract for the sale of land, the trial court’s findings reflected a correct application of the burden of proof under N.D.C.C. § 47-10-01 for claims for specific performance of an alleged oral contract to convey land. Thompson v. Thompson (In re Estate of Thompson), 2008 ND 144, 752 N.W.2d 624, 2008 N.D. LEXIS 142 (N.D. 2008).
It was not clear error to find a personal representative did not, under part performance, show an oral contract to sell an estate's real property to himself because (1) alternate theories explained the alleged contract's terms, and (2) the personal representative did not provide unequivocal evidence of the contract. Broten v. Broten, 2015 ND 127, 863 N.W.2d 902, 2015 N.D. LEXIS 115 (N.D. 2015).
In a quiet title action, an oral agreement relating to the purchase of property did not comply with the statute of frauds, and an argument that partial performance of the alleged oral contract precluded the application of the statute of frauds was not considered because it was raised for the first time on appeal. Klein v. Sletto, 2017 ND 26, 889 N.W.2d 918, 2017 N.D. LEXIS 14 (N.D. 2017).
Property owners failed to raise an issue of material fact that part performance removed an alleged agreement with the city from the statute of frauds because the affidavit and testimony of one of the owners provided nothing more than conclusory allegations of part performance; the owner’s testimony went no further than to allege she spent eight years cleaning the city’s streets so she could use them as pasture land. City of Glen Ullin v. Schirado, 2021 ND 72, 959 N.W.2d 47, 2021 N.D. LEXIS 73 (N.D. 2021).
Pleading.
This section is available as a defense under the general issue if the complaint fails to allege whether the contract was in writing. Fried v. Lonski, 48 N.D. 1023, 188 N.W. 582, 1922 N.D. LEXIS 135 (N.D. 1922); Brey v. Tvedt, 74 N.D. 192, 21 N.W.2d 49, 1945 N.D. LEXIS 67 (N.D. 1945).
Possession.
A judgment creditor with actual notice that a party is in possession of the property upon which the judgment lien attaches must make reasonable inquiry of the possessor’s interest in the property. If a possessor has an enforceable interest in the property under an oral contract of purchase, the judgment creditor takes subject to that interest. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
A possessor’s legal or equitable property interest is superior to the interest of a subsequent purchaser or judgment creditor who has notice, actual or constructive, of the possessor’s interest in the property. Williston Coop. Credit Union v. Fossum, 459 N.W.2d 548, 1990 N.D. LEXIS 174 (N.D. 1990).
Possession and Improvements.
Possession of real property must be actual, open, and notorious to serve as an act of part performance to take it out of the statute of frauds. Muir v. Chandler, 16 N.D. 551, 113 N.W. 1038, 1907 N.D. LEXIS 75 (N.D. 1907); Henry S. Grinde Corp. v. Klindworth, 77 N.D. 597, 44 N.W.2d 417, 1950 N.D. LEXIS 155, 1950 N.D. LEXIS 156 (N.D. 1950).
A contract for the sale of land within the statute of frauds may be enforced through an action for specific performance, although the requirements of the statute are not complied with, if the vendee takes possession and makes improvements on the premises. Mitchell v. Knudtson Land Co., 19 N.D. 736, 124 N.W. 946, 1910 N.D. LEXIS 12 (N.D. 1910); Syrup v. Pitcher, 73 N.W.2d 140, 1955 N.D. LEXIS 150 (N.D. 1955).
The statute of frauds cannot be invoked to defeat the parol gift of land, where the donee has taken possession and made improvements so that it would work substantial injustice to hold the gift void. Heuer v. Heuer, 64 N.D. 497, 253 N.W. 856, 1934 N.D. LEXIS 227 (N.D. 1934); Gran v. Gran, 69 N.D. 725, 290 N.W. 241, 1940 N.D. LEXIS 201 (N.D. 1940).
Possession of real estate obtained without the acquiescence of a vendor is not such possession as will constitute part performance and thus satisfy the statute of frauds. Brey v. Tvedt, 74 N.D. 192, 21 N.W.2d 49, 1945 N.D. LEXIS 67 (N.D. 1945).
Constructive possession is without force as a factor to take verbal agreement for the sale of real estate out of the statute of frauds. Henry S. Grinde Corp. v. Klindworth, 77 N.D. 597, 44 N.W.2d 417, 1950 N.D. LEXIS 155, 1950 N.D. LEXIS 156 (N.D. 1950).
In order to operate as a factor in the part performance of a verbal contract for the sale of real estate so as to take it out of the statute of frauds, improvements must be valuable, substantial, and permanent, and such that an action at law for damages would not afford adequate relief. Henry S. Grinde Corp. v. Klindworth, 77 N.D. 597, 44 N.W.2d 417, 1950 N.D. LEXIS 155, 1950 N.D. LEXIS 156 (N.D. 1950); Syrup v. Pitcher, 73 N.W.2d 140, 1955 N.D. LEXIS 150 (N.D. 1955).
An agreement for the conveyance of an interest in real property, within the statute of frauds, may be enforced, although it is not in writing, where the party takes possession and makes improvements on the property. Brandhagen v. Burt, 117 N.W.2d 696, 1962 N.D. LEXIS 94 (N.D. 1962).
Where defendants took possession pursuant to an oral contract of sale and made substantial permanent improvements to the property in reliance upon that contract, the statute of frauds did not bar specific enforcement of the oral contract of sale of the property. Green v. Gustafson, 482 N.W.2d 842, 1992 N.D. LEXIS 56 (N.D. 1992).
This section would not preclude enforcement of an alleged oral sales contract where the lessee invested labor and money in improvements on the premises; the lessor represented that she owned the land and would sell it to the lessee after the lease terminated. Ehrman v. Feist, 1997 ND 180, 568 N.W.2d 747, 1997 N.D. LEXIS 198 (N.D. 1997).
Railroad Lands.
Title of railroad grantor to after-acquired land passed to grantee by operation of law when patent was issued to the railroad by the United States. Bull v. Campbell, 225 F. 923, 141 C.C.A. 47 (8th Cir. 1915), appeal dismissed, 242 U.S. 610, 37 S. Ct. 17, 61 L. Ed. 525 (1916).
Scope of Statute.
This statute is not a limitation upon the language of N.D.C.C. § 9-06-04, which deals with transfers of oil, gas, or mineral leases. Petroleum Exch. v. Poynter, 64 N.W.2d 718, 1954 N.D. LEXIS 78 (N.D. 1954).
Successor in Interest.
The Farm Credit Bank is the successor in interest to the Federal Land Bank “by operation of law.” Farm Credit Bank v. Ziebarth, 485 N.W.2d 788, 1992 N.D. LEXIS 116 (N.D.), cert. denied, 506 U.S. 988, 113 S. Ct. 501, 121 L. Ed. 2d 437, 1992 U.S. LEXIS 7252 (U.S. 1992).
Collateral References.
Timber: sale or contract for sale of standing timber as within provisions of statute of frauds respecting sale or contract of sale of real property, 7 A.L.R.2d 517.
Specific performance: change of conditions after execution of contract or option for sale of real property as affecting right to specific performance, 11 A.L.R.2d 390.
Lease: sufficiency of memorandum of lease agreement to satisfy statute of frauds, as regards terms and conditions of lease, 16 A.L.R.2d 621.
Description or designation of land in contract or memorandum of sale, under statute of frauds, 23 A.L.R.2d 6.
Consideration: necessity and sufficiency of statement of consideration in contract or memorandum of sale of land, under statute of frauds, 23 A.L.R.2d 164.
Parties to action for specific performance of contract for conveyance of realty after death of party to the contract, 43 A.L.R.2d 938.
Specific performance: uncertainty as to terms of mortgage or of accompanying note or bond contemplated by real estate sales contract as affecting right to specific performance, 60 A.L.R.2d 251.
Venue of action for specific performance of contract pertaining to real property, 63 A.L.R.2d 456, 459.
Minerals: solid mineral royalty as real or personal property for purposes of statute of frauds, 68 A.L.R.2d 728, 735.
Lease: part performance doctrine with respect to renewal option in lease not complying with statute of frauds, 80 A.L.R.2d 425.
Specific performance: necessity and sufficiency of allegation, in a suit for specific performance on a contract for the sale of land, as to the adequacy of the consideration or as to the fairness of the contract, 100 A.L.R.2d 551.
Rescission: applicability of statute of frauds to agreement to rescind contract for sale of land, 42 A.L.R.3d 242.
Lease or sublease subscribed by one of the parties only, validity of, 46 A.L.R.3d 619.
Specific performance of land contract notwithstanding failure of vendee to make required payments on time, 55 A.L.R.3d 10.
Exception to rule that oral gifts of land are unenforceable under statute of frauds, 83 A.L.R.3d 1294.
Law Reviews.
The Statute of Frauds Restatement with North Dakota Annotations, 2 Dak. L. Rev. 373 (1929); 3 Dak. L. Rev. 319 (1930).
47-10-02. Sale of realty — Duty of seller.
An agreement to sell real property binds the seller to execute a conveyance in form sufficient to pass the title to the property.
Source:
Civ. C. 1877, § 988; R.C. 1895, § 3955; R.C. 1899, § 3955; R.C. 1905, § 5401; C.L. 1913, § 5957; R.C. 1943, § 47-1002.
Derivation:
Cal. Civ. C., 1731.
Notes to Decisions
Conveyance by Other than Vendor.
The tender, by a vendor under a contract to sell real estate, of a deed from a third party, the owner of the land agreed to be conveyed, does not comply with the contract calling for a deed from the vendor. McVeety v. Harvey Mercantile Co., 24 N.D. 245, 139 N.W. 586, 1913 N.D. LEXIS 1 (N.D. 1913).
Merchantable Title.
This section required seller to give merchantable title although agreement to sell realty failed to specify kind of title by which land was to be transferred. Overboe v. Overboe, 160 N.W.2d 650, 1968 N.D. LEXIS 70 (N.D. 1968).
Option to Purchase.
Where lessee-vendee in possession exercised an option to purchase an undivided one-half interest by tendering the purchase price, the option to purchase became an assignable contract of purchase and the lessee-vendee became the equitable owner of one-half interest and was entitled to share in the possession of the land. Olson v. Brodell, 128 N.W.2d 169, 1964 N.D. LEXIS 101 (N.D. 1964).
Collateral References.
Validity, construction and effect of land sale contract providing that title must be satisfactory to purchaser, 47 A.L.R.2d 455, 461.
Variance between offer and acceptance in regard to title as affecting consummation of contract for sale of real property, 16 A.L.R.3d 1424.
Vendor’s obligation to disclose to purchaser of land presence of contamination from hazardous substances or wastes, 12 A.L.R.5th 630.
47-10-02.1. Property disclosure — Requirements — Exceptions.
-
Unless the transaction is exempted under subsection 7, this section applies to a transaction for the sale, exchange, or purchase of real property if:
- A real estate broker, real estate broker associate, or real estate salesperson who is associated with a real estate brokerage firm represents or assists a party to the transaction; and
- The real property is a residential dwelling with no more than four units located in this state being sold or exchanged by the owner.
- Except as otherwise provided in an offer to purchase agreement, before the parties sign the final acceptance of the purchase agreement for the sale, exchange, or purchase of the real property, the seller in a transaction subject to subsection 1 shall prepare a written disclosure form and shall make the written disclosure form available to the prospective buyer. The written disclosure form must include all material facts the seller is aware could adversely and significantly affect an ordinary buyer’s use and enjoyment of the property or any intended use of the property of which the seller is aware. The written disclosure form must be in the form of the written disclosure form established by the North Dakota real estate commission under subsection 4 or in a substantially similar form and must include latent defects, general condition, environmental issues, structural systems, and mechanical issues regarding the property. The seller shall complete the written disclosure in good faith and based upon the best of the seller’s knowledge at the time of the disclosure.
- If a real estate broker, real estate broker associate, or real estate salesperson who is associated with a real estate brokerage firm represents or assists a party to the transaction, following the sale, exchange, or purchase of real property, the brokerage firm shall retain a copy of the written disclosure completed and signed by the seller and signed by the prospective buyer. The brokerage firm’s duties under this section do not supersede any other common law or statutory duties.
- The North Dakota real estate commission shall establish and make available a written disclosure form meeting the requirements of this section. In establishing the form, the commission shall consult with stakeholders, such as professional organizations.
- If a real estate broker, real estate broker associate, or real estate salesperson who is associated with a real estate brokerage firm violates this section, the state real estate commission may investigate and take disciplinary action under section 43-23-11.1.
- Unless the transaction is subject to subsection 1 or exempted under subsection 7, the seller of real property that is a residential dwelling with no more than four units located in this state being sold or exchanged by the owner shall comply with the provisions of this subsection. Except as otherwise provided in an offer to purchase agreement, before the parties sign the final acceptance of the purchase agreement for the sale, exchange, or purchase of the real property, the seller in a transaction subject to this subsection shall disclose to the buyer, in writing, all material facts the seller is aware could adversely and significantly affect an ordinary buyer’s use and enjoyment of the property or any intended use of the property of which the seller is aware. The written disclosure may be in the form of a written property disclosure form.
-
This section does not apply to transactions for the sale, exchange, or purchase of real property made:
- Pursuant to a court order;
- Between government agencies;
- By a mortgagor in default to a mortgagee;
- Pursuant to a foreclosure sale;
-
By a mortgagee or a beneficiary of a deed of trust who acquired the real property by a:
- Foreclosure;
- Deed in lieu of foreclosure; or
- Collateral assignment of beneficial interest;
- By a fiduciary administering a decedent’s estate, guardianship, conservatorship, or trust;
- Between co-owners of the real property;
- To a spouse, child, parent, sibling, grandchild, or grandparent; or
- If the real property is newly constructed residential real property with no previous occupancy.
Source:
S.L. 2021, ch. 334, § 1, eff August 1, 2021; 2019, ch. 378, § 1, eff August 1, 2019.
47-10-03. Agreement to give usual covenants on sale — Duty imposed.
An agreement on the part of a seller of real property to give the usual covenants binds the seller to insert in the grant covenants of seizin, quiet enjoyment, further assurance, general warranty, and against encumbrances.
Source:
Civ. C. 1877, § 989; R.C. 1895, § 3956; R.C. 1899, § 3956; R.C. 1905, § 5402; C.L. 1913, § 5958; R.C. 1943, § 47-1003.
Derivation:
Cal. Civ. C., 1733.
Cross-References.
Covenants implied from use of word “grant”, see N.D.C.C. § 47-10-19.
Covenants which run with the land, see N.D.C.C. §§ 47-04-24 to 47-04-26.
Damages for breach of covenant against encumbrances, see N.D.C.C. § 32-03-12.
Damages for breach of covenants in grants, see N.D.C.C. § 32-03-11.
Notes to Decisions
Contract for Marketable Title.
Where grantor covenanted to have a marketable title to land by time of transfer or he would withdraw it from sale, it was his duty to use good faith and reasonable efforts to perfect his title to all the lands involved. Sykes v. Robbins, 125 F. 433, 1903 U.S. App. LEXIS 4178, 1903 U.S. App. LEXIS 4179 (8th Cir. N.D. 1903).
Contract to Give Usual Covenants.
An executory contract to convey the deed with the usual covenants was not satisfied by a deed from vendor’s grantee, since the right to the vendor’s personal covenants not running with the land was a valuable right and the vendee was entitled to insist on receiving them in accordance with contract. Skinner v. Scholes, 59 N.D. 181, 229 N.W. 114, 1930 N.D. LEXIS 132 (N.D. 1930).
Covenant of Possession.
A provision whereby the seller is allowed to remain on the premises, unmolested and without the payment of rent, until certain notes are paid by the buyer, constitutes a personal covenant between the parties and is in no way inconsistent with the covenants required by this statute. Harding v. Trenor, 157 F. Supp. 350, 1957 U.S. Dist. LEXIS 2506 (D.N.D. 1957).
47-10-04. Form of covenants.
The covenants mentioned in section 47-10-03 must be in substance as follows:
The party of the first part covenants with the party of the second part that the former now is seized in fee simple of the property granted, that the latter shall enjoy the same without any lawful disturbance, that the same is free from all encumbrances, that the party of the first part and all persons acquiring any interest in the same through or for the party of the first part on demand will execute and deliver to the party of the second part, at the expense of the latter, any further assurance of the same that reasonably may be required, and that the party of the first part will warrant to the party of the second part all the said property against every person lawfully claiming the same.
Source:
Civ. C. 1877, § 990; R.C. 1895, § 3957; R.C. 1899, § 3957; R.C. 1905, § 5403; C.L. 1913, § 5959; R.C. 1943, § 47-1004.
Derivation:
Cal. Civ. C., 1734.
47-10-05. Grants — Execution — Witnesses sufficient — Seal unnecessary.
The execution of a grant of an estate in real property to entitle the same to be recorded, if it is not acknowledged, must be proved by a subscribing witness or as otherwise provided in sections 47-19-23 and 47-19-24. The absence of the seal of any grantor or grantor’s agent from any grant of an estate made in real property shall not invalidate or in any manner impair the same.
Source:
Civ. C. 1877, § 623; R.C. 1895, § 3536; R.C. 1899, § 3536; R.C. 1905, § 4973; C.L. 1913, § 5516; R.C. 1943, § 47-1005.
Collateral References.
Record of instrument without sufficient acknowledgment as notice, 59 A.L.R.2d 1299.
47-10-05.1. Presumption of corporate authority of officers — Application.
An officer of any foreign or domestic corporation, or a manager of any foreign or domestic limited liability company, is presumed to have the power and authority to execute and acknowledge, in its behalf, any instrument granting, conveying, or otherwise affecting any interest in or lien upon any property of the corporation or limited liability company, including contracts, mortgages, deeds, plats, replats, easements, rights of way, options, dedications, restrictions, releases, and satisfactions. Any such instrument executed by an officer of the corporation or limited liability company prior to July 1, 1983, and otherwise proper, is valid and effective.
Source:
S.L. 1983, ch. 502, § 1; 1993, ch. 54, § 106.
47-10-06. Form of grant.
A grant of an estate in real property may be made in substance as follows:
This grant made the day of , in the year of , between A.B., of , of the first part, and C.D., of , of the second part, witnesseth: That the party of the first part hereby grants to the party of the second part in consideration of dollars, now received, all the real property situated in , and bounded (or described) as follows: Witness the hand of the party of the first part. A.B.
Click to view
Source:
Civ. C. 1877, § 624; R.C. 1895, § 3537; R.C. 1899, § 3537; R.C. 1905, § 4973; C.L. 1913, § 5516; R.C. 1943, § 47-1006.
Derivation:
Cal. Civ. C., 1092.
Notes to Decisions
Blanks Left in Deed.
Deed form left blank, except for the signature of the grantor and an attached description of the property, delivered by grantor to the grantee along with verbal instructions for grantee to have an attorney insert the description of the property and grantee’s name in the deed, was a valid transfer between grantor and grantee when deed was delivered in blank to the grantee. Mehus v. Thompson, 266 N.W.2d 920, 1978 N.D. LEXIS 252 (N.D. 1978).
Form Not Mandatory.
The form provided in this section may be used but is not required as North Dakota law prescribes no particular form to be used in a grant of real property. Mehus v. Thompson, 266 N.W.2d 920, 1978 N.D. LEXIS 252 (N.D. 1978).
Collateral References.
Validity and effect of one spouse’s conveyance to other spouse of interest in property held as estate by the entireties, 18 A.L.R.5th 230.
47-10-07. Deed — Execution — Post-office and street address of grantee a prerequisite.
Each deed executed in which real estate is described shall contain the post-office address, and any known or existing street address if within the corporate boundaries of a city, of each grantee named in such deed.
Source:
S.L. 1929, ch. 249, § 1; R.C. 1943, § 47-1007; S.L. 1975, ch. 421, § 1.
Cross-References.
Deeds not containing post-office address prior to January 1, 1955, validated, see N.D.C.C. § 1-04-22.
Instrument not to be recorded without address, see N.D.C.C. § 47-19-05.
Notes to Decisions
Effect of Noncompliance.
A deed which fails to contain the post-office address of the grantee and is for that reason made ineligible for recording is nevertheless effective as a grant. Glascoe v. Bracksieck, 85 N.W.2d 423, 1957 N.D. LEXIS 150 (N.D. 1957).
Where post-office addresses of grantees were omitted from the deed, it was still valid as between grantor and grantees even though not entitled to be recorded. Rosenquist v. Harris, 138 F. Supp. 21, 1956 U.S. Dist. LEXIS 3722 (D.N.D. 1956).
47-10-08. Grant conclusive against whom.
Every grant of an estate in real property is conclusive against the grantor and every one subsequently claiming under the grantor, except a purchaser or encumbrancer who in good faith and for a valuable consideration acquires a title or lien by an instrument that first is duly recorded.
Source:
Civ. C. 1877, § 629; R.C. 1895, § 3540; R.C. 1899, § 3540; R.C. 1905, § 4977; C.L. 1913, § 5522; R.C. 1943, § 47-1008.
Derivation:
Cal. Civ. C., 1107.
Notes to Decisions
Grant Superior to Reservation.
A grantor who, by warranty deed, purports to convey a fractional mineral interest is estopped from asserting title to a reserved fractional mineral interest in contradiction to the interest purportedly conveyed; the key question is, not what the grantor purported to retain for himself, but what he purported to give to the grantee. If both grant and reservation cannot be given effect, the reservation must fail. Mau v. Schwan, 460 N.W.2d 131, 1990 N.D. LEXIS 180 (N.D. 1990).
Perfection by Recordation.
Perfection of a mortgage on real estate as against subsequent purchasers and encumbrancers is accomplished by recordation. Until recordation occurs, an unrecorded mortgage, while effective as between the parties themselves, is ineffective as against bona fide purchasers for value. Drewes v. Vatnsdal, 139 B.R. 472, 1991 Bankr. LEXIS 2071 (Bankr. D.N.D. 1991).
Quitclaim Deed.
Grant in quitclaim deed is conclusive against the grantors and their privies, and they are precluded from repudiating their agreement and denying the validity of their deed. Gajewski v. Bratcher, 221 N.W.2d 614, 1974 N.D. LEXIS 173, 1974 N.D. LEXIS 222 (N.D. 1974).
Reformation.
The grants in deeds are conclusive against the grantors unless grounds exist to reform those conveyances. Mau v. Schwan, 460 N.W.2d 131, 1990 N.D. LEXIS 180 (N.D. 1990).
47-10-09. Grant valid pro tanto.
A grant made by the owner of an estate for life or years, purporting to transfer a greater estate than the owner could transfer lawfully, does not work a forfeiture of the owner’s estate but passes to the grantee all the estate which the grantor could lawfully transfer.
Source:
Civ. C. 1877, § 630; R.C. 1895, § 3541; R.C. 1899, § 3541; R.C. 1905, § 4978; C.L. 1913, § 5523; R.C. 1943, § 47-1009.
Derivation:
Cal. Civ. C., 1108.
47-10-10. Title to highway, street, alley, and public right of way — Vacation.
A transfer of land bounded by a highway, street, alley, or public right of way passes the title of the person whose estate is transferred to the soil of the highway, street, alley, or public right of way in front to the center thereof unless a different intent appears from the grant. Every conveyance of real estate, which abuts upon a vacated highway, street, alley, or other public right of way, shall be construed, unless a contrary intent appears, to include that part of such highway, street, alley, or public right of way which attaches either by operation or presumption of law, to such abutting real estate upon such vacation.
Source:
Civ. C. 1877, § 631; R.C. 1895, § 3542; R.C. 1899, § 3542; R.C. 1905, § 4979; C.L. 1913, § 5524; R.C. 1943, § 47-1010; S.L. 1957, ch. 309, § 1; 1957 Supp., § 47-1010.
Derivation:
Cal. Civ. C., 1112.
Cross-References.
Covenants of warranty not broken by existence of highway right of way, exception, see N.D.C.C. § 47-04-31.
Presumption of ownership to center of street, see N.D.C.C. § 47-01-16.
Notes to Decisions
Contrary Intent.
A different intent appears from a grant when the soil beneath the highway is specifically excepted from the grant. Lalim v. Williams County, 105 N.W.2d 339, 1960 N.D. LEXIS 89 (N.D. 1960).
Vacation by Law.
A conveyance without any reservation by the owner of a lot adjoining a street will pass title to the center of the street except in cases where the street has been vacated, the manner provided by law. Welsh v. Monson, 79 N.W.2d 155, 1956 N.D. LEXIS 153 (N.D. 1956).
Collateral References.
Description with reference to highway as carrying title to center or side of highway, 49 A.L.R.2d 982.
47-10-11. Easements — Pass by transfer of property to which attached.
A transfer of real property passes all easements attached thereto and creates in favor thereof an easement to use other real property of the person whose estate is transferred in the same manner and to the same extent as such property obviously and permanently was used by the person whose estate is transferred, for the benefit thereof, at the time when the transfer was agreed upon or completed.
Source:
Civ. C. 1877, § 627; R.C. 1895, § 3538; R.C. 1899, § 3538; R.C. 1905, § 4975; C.L. 1913, § 5520; R.C. 1943, § 47-1011.
Derivation:
Cal. Civ. C., 1104.
Cross-References.
Easements attached to other land, see N.D.C.C. § 47-05-01.
Notes to Decisions
Easement Instead of License.
Summary judgment was properly entered against appellant in a case alleging trespass and other causes of action because a 1953 permit issued to another constituted an easement, rather than a license, since it was not revocable at the will of a landowner; under N.D.C.C. § 47-10-11, a transfer of real property passed all easements, but a license was generally not assignable. Moreover, N.D.C.C. § 47-05-02.1(1) only applied to easements that became binding after July 1, 1977. Riverwood Commer. Park, LLC v. Std. Oil Co., 2011 ND 95, 797 N.W.2d 770, 2011 N.D. LEXIS 95 (N.D. 2011).
Failure to Reserve or Except.
Failure to reserve or except an easement appurtenant to the real property transferred will pass the easement to the transferee even where the deed of transfer contains nothing about the easement. Royse v. Easter Seal Soc'y for Crippled Children & Adults, 256 N.W.2d 542, 1977 N.D. LEXIS 147 (N.D. 1977).
47-10-12. Warranties — Lineal and collateral abolished — Exceptions.
Lineal and collateral warranties with all their incidents are abolished but the heirs and devisees of any person who has made any covenant or agreement in reference to the title of, in, or to any real property are answerable upon such covenant or agreement to the extent of the land descended or devised to them in the cases and in the manner prescribed by law.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3544; R.C. 1899, § 3544; R.C. 1905, § 4981; C.L. 1913, § 5526; R.C. 1943, § 47-1012.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
47-10-13. Grant presumes fee simple title.
A fee simple title is presumed to be intended to pass by a grant of real property unless it appears from the grant that a lesser estate was intended.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3545; R.C. 1899, § 3545; R.C. 1905, § 4982; C.L. 1913, § 5527; R.C. 1943, § 47-1013.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
Notes to Decisions
- Husband Conveying to Wife.
- Presumption Not Conclusive.
- Rebutting the Presumption.
- Reservations and Exceptions.
Husband Conveying to Wife.
A deed by which the owner of realty purports to grant and convey realty to his wife conveys a fee simple title to her. Lee v. Lee, 70 N.D. 79, 292 N.W. 124, 1940 N.D. LEXIS 149 (N.D. 1940).
Presumption Not Conclusive.
This is not a conclusive presumption. Lalim v. Williams County, 105 N.W.2d 339, 1960 N.D. LEXIS 89 (N.D. 1960).
Rebutting the Presumption.
Evidence to overcome the presumption provided in this statute must be clear, specific, satisfactory, and convincing. Mechtle v. Topp, 78 N.D. 789, 52 N.W.2d 842, 1952 N.D. LEXIS 78 (N.D. 1952); Ives v. Hanson, 66 N.W.2d 802, 1954 N.D. LEXIS 112 (N.D. 1954); Burr v. Kelley, 74 N.W.2d 428, 1956 N.D. LEXIS 87 (N.D. 1956).
Reservations and Exceptions.
Reservations and exceptions to the grant should be set forth in the granting clause with the same prominence as the property granted, or, if placed elsewhere in the deed, must be so explicit as to leave no doubt that they are reservations or exceptions to the grant and not to the covenant of warranty. Royse v. Easter Seal Soc'y for Crippled Children & Adults, 256 N.W.2d 542, 1977 N.D. LEXIS 147 (N.D. 1977).
47-10-14. Grant takes effect on performance of condition.
An instrument purporting to be a grant of real property to take effect upon a condition precedent passes the estate upon the performance of the condition.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3546; R.C. 1899, § 3546; R.C. 1905, § 4983; C.L. 1913, § 5528; R.C. 1943, § 47-1014.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
Notes to Decisions
Waiver of Condition Precedent.
If a condition precedent which has been agreed upon in the preliminary agreement to execute a mineral deed is not included in the deed itself, such condition has been waived and title is presently conveyed by the deed. Accola v. Miller, 76 N.W.2d 517, 1956 N.D. LEXIS 116, 1956 N.D. LEXIS 117 (N.D. 1956).
Collateral References.
Effect on validity and character of instrument in form of deed of provisions therein indicating an intention to postpone or limit the rights of grantee until after the death of grantor, 31 A.L.R.2d 532.
47-10-15. After-acquired title.
When a person purports by proper instrument to convey real property in fee simple and subsequently acquires any title or claim of title to the real property, the real property passes by operation of law to the person to whom the property was conveyed or that person’s successor. A quitclaim deed that includes the word “grant” in the words of conveyance, regardless of the words used to describe the interest in the real property being conveyed by the grantor, passes after-acquired title. The use of a quitclaim deed, with or without the inclusion of after-acquired title in the deed, does not create any defect in the title of a person that conveys real property. This section applies to any conveyance regardless of when executed.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3547; R.C. 1899, § 3547; R.C. 1905, § 4984; C.L. 1913, § 5529; R.C. 1943, § 47-1015; S.L. 2013, ch. 346, § 1.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
Effective Date.
The 2013 amendment of this section by section 1 of chapter 346, S.L. 2013 became effective August 1, 2013.
Notes to Decisions
Adverse Possession.
Where grantor owned the property in fee simple at the time he purportedly executed the warranty deed transferring the property to the grantor, the doctrines of after-acquired title and estoppel by deed were not applicable to bar grantor’s claim to the property after the conveyance by adverse possession. Torgerson v. Rose, 339 N.W.2d 79, 1983 N.D. LEXIS 365 (N.D. 1983).
Estoppel by Deed.
The doctrine of estoppel by deed is not limited to grants falling within the provisions of this statute, but may arise from covenants of warranty contained in other grants. Aure v. Mackoff, 93 N.W.2d 807, 1958 N.D. LEXIS 109 (N.D. 1958).
Patented Lands.
Grant of public lands to railroad by patent in praesenti gave title to grantee of railroad which had conveyed the lands before execution of the patent. Bull v. Campbell, 225 F. 923, 141 C.C.A. 47 (8th Cir. 1915), appeal dismissed, 242 U.S. 610, 37 S. Ct. 17, 61 L. Ed. 525 (1916).
Quitclaim Deed.
After-acquired title by the grantor will not, as a general rule, inure to the benefit of the grantee under a quitclaim deed. Bilby v. Wire, 77 N.W.2d 882, 1956 N.D. LEXIS 136 (N.D. 1956); Aure v. Mackoff, 93 N.W.2d 807, 1958 N.D. LEXIS 109 (N.D. 1958).
When the quitclaim deed contains a warranty of title, the warranty estops the warrantor from asserting against the grantee or his assigns any after-acquired title derived through any act or conveyance of the warrantor prior to the deed. Aure v. Mackoff, 93 N.W.2d 807, 1958 N.D. LEXIS 109 (N.D. 1958).
Appellants asserted that under N.D.C.C. § 47-10-19, using the term “grant” implied certain covenants, but the deed from the grantor was plainly labeled as a quitclaim deed, and although the deed used the term “grant,” it did so in reference to the grantor’s right, title, and interest in the property, rather than specifically granting the entire fee to the grantee; proper consideration of the deed looked to the entire document, and after considering case law from South Dakota that discussed S.D. Codified Laws §§ 3249, 3254, the court construed the deed as a quitclaim deed and rejected appellants’ claim that use of the word “grant” transformed the entire deed so as to also pass after-acquired title under N.D.C.C. § 47-10-15. Carkuff v. Balmer, 2011 ND 60, 795 N.W.2d 303, 2011 N.D. LEXIS 43 (N.D. 2011).
Transfer by Operation of Law.
Where a person purports by a proper instrument to grant real property in fee simple and subsequently acquires any title or claim of title thereto, the title or claim so acquired passes by operation of law to the grantee. Stark County v. Koch, 107 N.W.2d 701, 1961 N.D. LEXIS 64 (N.D. 1961).
Divorce judgment did not convey after-acquired title in mineral interests because the judgment was not a quit claim deed and included no language granting or warranting the grantor's title to the mineral interests in fee simple, so the judgment purported to convey only the grantor's interest as distinguished from a fee simple title. Hall v. Malloy, 2015 ND 94, 862 N.W.2d 514, 2015 N.D. LEXIS 97 (N.D. 2015).
47-10-16. Reconveyance when estate defeated by nonperformance of condition subsequent.
When a grant is made upon condition subsequent and subsequently is defeated by the nonperformance of the condition, the person otherwise entitled to hold under the grant must reconvey the property to the grantor or the grantor’s successors by grant duly acknowledged for record.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3548; R.C. 1899, § 3548; R.C. 1905, § 4985; C.L. 1913, § 5530; R.C. 1943, § 47-1016.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
47-10-17. Encumbrances defined.
The term encumbrances includes taxes, assessments, and all liens upon real property.
Source:
Civ. C. 1877, § 633; R.C. 1895, § 3549; S.L. 1899, ch. 89, § 1; R.C. 1899, § 3549; R.C. 1905, § 4986; C.L. 1913, § 5531; R.C. 1943, § 47-1017.
Derivation:
Cal. Civ. C., 1105, 1106, 1109, 1110, 1114, 1115.
47-10-18. Liability of grantor.
Whoever conveys real estate by deed or mortgage containing a covenant that it is free from all encumbrances, when an encumbrance appears of record to exist thereon, whether known or unknown to that person, shall be liable in an action of contract, to the grantee and the grantee’s heirs, executors, administrators, successors, grantees, or assigns for all damages sustained in removing the same.
Source:
S.L. 1899, ch. 89, § 1; R.C. 1899, § 3549; R.C. 1905, § 4987; C.L. 1913, § 5532; R.C. 1943, § 47-1018.
Cross-References.
Damages for breach of covenant against encumbrances, see N.D.C.C. § 32-03-12.
Notes to Decisions
Attorney Fees in Reformation Action.
Although N.D.C.C. § 47-10-18 may entitle a party to attorney fees for a quiet title action, the Supreme Court of North Dakota concludes that N.D.C.C. § 47-10-18 does not authorize attorney fees for a reformation action, which is premised on a claim that a warranty deed does not reflect the parties’ true intentions. Anderson v. Selby, 2005 ND 126, 700 N.W.2d 696, 2005 N.D. LEXIS 162 (N.D. 2005).
Collateral References.
Marketability of title as affected by lien dischargeable only out of funds to be received from purchaser at closing, 53 A.L.R.3d 678.
47-10-19. Covenants implied from use of word grant.
From the use of the word “grant” in any conveyance by which an estate of inheritance or fee simple is to be passed, the following covenants, and none other, on the part of the grantor for the grantor and the grantor’s heirs to the grantee and the grantee’s heirs and assigns, are implied unless restrained by express terms contained in such conveyance:
- That previous to the time of the execution of such conveyance, the grantor has not conveyed the same estate, nor any right, title, or interest therein, to any person other than the grantee; and
- That such estate, at the time of the execution of such conveyance, is free from encumbrances done, made, or suffered by the grantor, or any person claiming under the grantor. Such covenants may be sued upon in the same manner as if they had been inserted expressly in the conveyance.
Source:
Civ. C. 1877, § 628; R.C. 1895, § 3539; R.C. 1899, § 3539; R.C. 1905, § 4976; C.L. 1913, § 5521; R.C. 1943, § 47-1019.
Derivation:
Cal. Civ. C., 1113.
Cross-References.
Damages for breach of covenant against encumbrances, see N.D.C.C. § 32-03-12.
Damages for breach of covenants in grant, see N.D.C.C. § 32-03-11.
Notes to Decisions
Contract for Sale.
Where the contract provided for the sale of land without specifying the kind of conveyance, it will be implied that a conveyance of the fee by deed with general warranty was intended. Hoth v. Kahler, 74 N.W.2d 440, 1956 N.D. LEXIS 89 (N.D. 1956).
Express Covenant Against Encumbrances.
The implied covenant against encumbrances raised by the use of the word “grant” in a conveyance in fee is restrained, as against the grantor, by an express covenant against encumbrances limited by its terms to the heirs, executors, and administrators of the grantor. Dun v. Dietrich, 3 N.D. 3, 53 N.W. 81, 1892 N.D. LEXIS 3 (N.D. 1892).
Joinder of Wife.
A wife who joins her husband in a deed for no purpose other than to release her homestead right in the property is not bound by the implied covenant arising from the use of the word “grant”. Dun v. Dietrich, 3 N.D. 3, 53 N.W. 81, 1892 N.D. LEXIS 3 (N.D. 1892).
Quitclaim Deed.
A quitclaim deed is one which purports to convey, and is understood to convey, nothing more than the interest or estate in the property described of which the grantor is seized or possessed, if any, at the time, rather than the property itself. Frandson v. Casey, 73 N.W.2d 436, 1955 N.D. LEXIS 155 (N.D. 1955).
Appellants asserted that under N.D.C.C. § 47-10-19, using the term “grant” implied certain covenants, but the deed from the grantor was plainly labeled as a quitclaim deed, and although the deed used the term “grant,” it did so in reference to the grantor’s right, title, and interest in the property, rather than specifically granting the entire fee to the grantee; proper consideration of the deed looked to the entire document, and after considering case law from South Dakota that discussed S.D. Codified Laws §§ 3249, 3254, the court construed the deed as a quitclaim deed and rejected appellants’ claim that use of the word “grant” transformed the entire deed so as to also pass after-acquired title under N.D.C.C. § 47-10-15. Carkuff v. Balmer, 2011 ND 60, 795 N.W.2d 303, 2011 N.D. LEXIS 43 (N.D. 2011).
Collateral References.
Measure of damages for breach of covenant of quiet enjoyment in lease, 41 A.L.R.2d 1414, 1454.
47-10-20. Attornment — When unnecessary.
Grants of rents, reversions, or remainders are good and effectual without attornments of the tenants, but no tenant, who before notice of the grant shall have paid rent to the grantor, must suffer any damage thereby.
Source:
Civ. C. 1877, § 632; R.C. 1895, § 3543; R.C. 1899, § 3543; R.C. 1905, § 4980; C.L. 1913, § 5525; R.C. 1943, § 47-1020.
Derivation:
Cal. Civ. C., 1111.
Cross-References.
Attornment to stranger void unless made with consent of landlord or in consequence of court judgment, see § 47-16-25.
47-10-21. Reservation of coal limited to description. [Repealed]
Repealed by S.L. 1979, ch. 187, § 108.
DECISIONS UNDER PRIOR LAW
Unconstitutional.
Since there is no reasonable basis for requiring that the nature, length, width and thickness of coal reservations be described in a deed when such description is not required of grants of coal, these sections (requiring that reservations be so described in order to be effective) create a classification which is unreasonable and which results in invidious discrimination against an interest in coal created by reservation as opposed to one created by a grant; this constitutes a violation of the equal protection clauses of the state constitution and the United States constitution. Christman v. Emineth, 212 N.W.2d 543, 1973 N.D. LEXIS 133 (N.D. 1973).
Christman decision was held to apply retroactively in Olson v. Dillerud, 226 N.W.2d 363, 1975 N.D. LEXIS 203 (N.D. 1975).
47-10-22. Reservation without description ineffectual. [Repealed]
Repealed by S.L. 1979, ch. 187, § 108.
DECISIONS UNDER PRIOR LAW
Unconstitutional.
Since there is no reasonable basis for requiring that the nature, length, width and thickness of coal reservations be described in a deed when such description is not required of grants of coal, these sections (requiring that reservations be so described in order to be effective) create a classification which is unreasonable and which results in invidious discrimination against an interest in coal created by reservation as opposed to one created by a grant; this constitutes a violation of the equal protection clauses of the state constitution and the United States constitution. Christman v. Emineth, 212 N.W.2d 543, 1973 N.D. LEXIS 133 (N.D. 1973).
Christman decision was held to apply retroactively in Olson v. Dillerud, 226 N.W.2d 363, 1975 N.D. LEXIS 203 (N.D. 1975).
47-10-23. Transfer by grantor to the grantor and another in joint tenancy.
Any person, firm, corporation, or limited liability company owning a legal or equitable title to or interest in any real property in the state of North Dakota may sell, transfer, and convey the same as grantor to the grantor and any other person, firm, corporation, or limited liability company, including the spouse of said grantor, in joint tenancy, with right of survivorship, without the necessity of any transfer or conveyance to or through any third person.
Source:
S.L. 1943, ch. 213, § 2; R.C. 1943, § 47-1023; S.L. 1993, ch. 54, § 106.
Cross-References.
Personal property interest, transfer by owner to himself and others in joint tenancy, validation of prior transfers, see N.D.C.C. §§ 47-11-14, 47-11-15.
Validating real property transfers in joint tenancy, see N.D.C.C. § 1-04-20.
Collateral References.
Character of tenancy created by owner’s conveyance to himself and another, or to another alone of an undivided interest, 44 A.L.R.2d 595.
47-10-23.1. Nontestamentary transfer between spouses — Presumption.
A nontestamentary transfer of real property between spouses shall be presumed to be for a consideration, and not a gift, unless otherwise stated in writing at the time of transfer. This presumption is conclusive.
Source:
S.L. 1979, ch. 483, § 1.
Notes to Decisions
Gifts.
District court properly determined that the transfers made by a wife to herself pursuant to a power of attorney from her husband were not gifts because she did not breach a fiduciary duty since she had authority to make the transfers under the power of attorney’s real estate transfer provision, there was no assertion or evidence of the existence of a writing made at the time of either transfer stating it was a gift, and the husband had a legal obligation to support her out of his individual property. Estate of Lindvig v. Jellum, 2020 ND 236, 951 N.W.2d 214, 2020 N.D. LEXIS 244 (N.D. 2020).
47-10-24. Description and definition of minerals in leases and conveyances.
All conveyances of mineral rights or royalties in real property in this state, excluding leases, shall be construed to grant or convey to the grantee thereof all minerals of any nature whatsoever except those minerals specifically excluded by name in the deed, grant, or conveyance, and their compounds and byproducts, but shall not be construed to grant or convey to the grantee any interest in any gravel, clay, or scoria unless specifically included by name in the deed, grant, or conveyance.
No lease of mineral rights in this state shall be construed as passing any interest to any minerals except those minerals specifically included and set forth by name in the lease. For the purposes of this paragraph the naming of either a specific metalliferous element, or nonmetalliferous element, and if so stated in lease, shall be deemed to include all of its compounds and byproducts, and in the case of oil and gas, all associated hydrocarbons produced in a liquid or gaseous form so named shall be deemed to be included in the mineral named. The use of the words “all other minerals” or similar words of an all-inclusive nature in any lease shall not be construed as leasing any minerals except those minerals specifically named in the lease and their compounds and byproducts.
Source:
S.L. 1955, ch. 235, § 1; 1957, ch. 245, § 1; R.C. 1943, 1957 Supp., § 47-1024; S.L. 1969, ch. 403, § 1; 1983, ch. 503, § 1.
Notes to Decisions
- Constitutionality.
- All Other Minerals.
- Applicability.
- Life Estate.
- Reservation or Exception in Deed.
Constitutionality.
This section does not impose or demand invidious or unreasonable discriminatory requirements; it does not violate N.D. Const. Art. I, § 20 or the Fourteenth Amendment to the U.S. Constitution.Reiss v. Rummel, 232 N.W.2d 40, 1975 N.D. LEXIS 110 (N.D. 1975).
All Other Minerals.
The words “all other minerals” contained in a lease of real property for the purpose of mining and producing oil and gas and all other minerals do not include all inorganic matter, but are subject to some limitations. MacMaster v. Onstad, 86 N.W.2d 36, 1957 N.D. LEXIS 164, 1957 N.D. LEXIS 165 (N.D. 1957).
Where granting clause of deed transferring 15/480 mineral interest said “all the oil, gas, casinghead gas, casinghead gasoline and other minerals in and under (said land)” but did not use language setting forth specifically and separately intent to convey or include coal, deed did not convey any interest in coal in described property. Reiss v. Rummel, 232 N.W.2d 40, 1975 N.D. LEXIS 110 (N.D. 1975).
The words “all other minerals” contained in an oil and gas lease covered all other minerals which could be mined from the earth, and not just oil and gas. Evangelical Lutheran Church v. Stanolind Oil & Gas Co., 251 F.2d 412, 1958 U.S. App. LEXIS 5386 (8th Cir. N.D. 1958).
Applicability.
This section was not controlling in interpreting mineral reservation in deeds made long before this section became effective. McDonald v. Antelope Land & Cattle Co., 294 N.W.2d 391, 1980 N.D. LEXIS 258 (N.D. 1980).
Life Estate.
Probate court did not err in determining the land in the legacy trust was part of the estate and in determining the extent of the decedent’s life estate in a tract of land in Divide County because the trust had no estate planning purpose and was not created to benefit the decedent as it effectively deprived her of her real property during her lifetime; and the language of the deed provided the decedent with all the oil and gas revenue from the tract of land in Divide County during her lifetime as the deed conveyed the decedent’s and her husband’s surface rights and all their right, title, and interest to any and all oil, gas, coal, and other minerals in, under or upon the land, subject to a life estate for the decedent and her husband. Bouchard v. Biel (In re Estate of Brandt), 2019 ND 87, 924 N.W.2d 762, 2019 N.D. LEXIS 86 (N.D. 2019).
Reservation or Exception in Deed.
This section does not apply to transactions in which grantors retain mineral rights by reservation or exception; legislature intended to limit its application to those real property transactions where owners conveyed mineral rights under the circumstances outlined therein; “conveyance”, as used herein, has limited meaning and does not take on the meaning of the term as defined in N.D.C.C. § 47-19-42. Reiss v. Rummel, 232 N.W.2d 40, 1975 N.D. LEXIS 110 (N.D. 1975).
Collateral References.
Open pit mining, conveyance of minerals as including minerals recoverable only by, 1 A.L.R.2d 787.
Oil and gas as “minerals” within deed, lease or license, 37 A.L.R.2d 1440.
Clay, sand or gravel as “minerals” within deed, lease or license, 95 A.L.R.2d 843.
Coal or metallic ores; grant, lease, exception or reservation of “oil, gas and other minerals”, or the like, as including coal or metallic ores, 59 A.L.R.3d 1146.
Oil shale: grant, lease, exception or reservation of oil and/or gas rights as including oil shale, 61 A.L.R.3d 1109.
Surface mining: grant, reservation or lease of minerals and mining rights as including, without expressly so providing, the right to remove the minerals by surface mining, 70 A.L.R.3d 383.
Law Reviews.
Severed Mineral Interests, A Problem Without A Solution?, 46 N.D. L. Rev. 451 (1970).
Severed Mineral Interests, Ernest R. Fleck, 51 N.D. L. Rev. 369 (1975).
“And Other Minerals” as Interpreted by the North Dakota Supreme Court, Robert E. Beck, 52 N.D. L. Rev. 633 (1976).
The Meaning of the Word “Minerals”, 54 N.D. L. Rev. 419 (1978).
Surface Damages and the Oil and Gas Operator in North Dakota, 58 N.D. L. Rev. 457 (1982).
47-10-25. Meaning of minerals in deed, grant, or conveyance of title to real property.
In all deeds, grants, or conveyances of the title to the surface of real property executed on or after July 1, 1983, in which all or any portion of the minerals are reserved or excepted and thereby effectively precluded from being transferred with the surface, all minerals, of any nature whatsoever, shall be construed to be reserved or excepted except those minerals specifically excluded by name in the deed, grant, or conveyance and their compounds and byproducts. Gravel, clay, and scoria shall be transferred with the surface estate unless specifically reserved by name in the deed, grant, or conveyance.
Source:
S.L. 1975, ch. 422, § 1; 1983, ch. 504, § 1.
Notes to Decisions
Applicability.
This section was not controlling in interpreting mineral reservation in deeds made long before this section became effective. McDonald v. Antelope Land & Cattle Co., 294 N.W.2d 391, 1980 N.D. LEXIS 258 (N.D. 1980).
Life Estate.
Probate court did not err in determining the land in the legacy trust was part of the estate and in determining the extent of the decedent’s life estate in a tract of land in Divide County because the trust had no estate planning purpose and was not created to benefit the decedent as it effectively deprived her of her real property during her lifetime; and the language of the deed provided the decedent with all the oil and gas revenue from the tract of land in Divide County during her lifetime as the deed conveyed the decedent’s and her husband’s surface rights and all their right, title, and interest to any and all oil, gas, coal, and other minerals in, under or upon the land, subject to a life estate for the decedent and her husband. Bouchard v. Biel (In re Estate of Brandt), 2019 ND 87, 924 N.W.2d 762, 2019 N.D. LEXIS 86 (N.D. 2019).
Reservations and Exceptions.
Where language in deed did not constitute a reservation so clearly expressed and explicit as to leave no room for doubt, and was ambiguous as to whether the exception was an exception to the grant or to the warranty, the language did not effectively except or reserve to the grantor any mineral interest. Mueller v. Stangeland, 340 N.W.2d 450, 1983 N.D. LEXIS 415 (N.D. 1983).
District court properly granted summary judgment to appellee landowner in her action to quiet title to gravel, clay, and scoria in a section of land because the reservation of minerals in a 1970 warranty deed did not include gravel, clay or scoria under North Dakota law prior to July 1, 1975—before the enactment of N.D.C.C. § 47-10-25. George v. Veeder, 2012 ND 186, 820 N.W.2d 731, 2012 N.D. LEXIS 189 (N.D. 2012).
District court erred by concluding that a warranty deed was ambiguous and N.D.C.C. § 47-10-25 did not apply because the gravel had been reserved or conveyed in earlier deeds where the warranty deed was unambiguous and did not specifically reserve the gravel or other surface minerals as required by N.D.C.C. § 47-10-25. Even if the warranty deed and release of claims were read together, neither stated that the gravel was excluded from the conveyance. Estate of Seidel v. Seidel, 2021 ND 6, 953 N.W.2d 636, 2021 N.D. LEXIS 5 (N.D. 2021).
Law Reviews.
And Other Minerals as Interpreted by the North Dakota Supreme Court, Robert E. Beck, 52 N.D. L. Rev. 633 (1976).
The Meaning of the Word “Minerals”, 54 N.D. L. Rev. 419 (1978).
47-10-26. Authority of trustee.
The trustee of a trust that holds title to real property is presumed to have the power to sell, convey, and encumber the real property unless restrictions on that power appear in the records of the county recorder.
Source:
S.L. 2009, ch. 392, § 1.
47-10-27. Manufactured homes — Affixation to real property — Conveyance or encumbrance as real property.
- For purposes of this section, “manufactured home” means a manufactured home as defined in section 41-09-02. Notwithstanding this definition, for purposes of 11 U.S.C. 1322(b)(2), a manufactured home is deemed real property. For purposes of this section, a manufactured home is permanently affixed if the manufactured home is affixed to real property and connected to residential utilities, such as water, gas, electricity, or sewer or septic service.
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To convey or voluntarily encumber a manufactured home as real property, the following conditions must be met:
- The manufactured home must be permanently affixed to real property;
- The ownership interests in the manufactured home and the real property to which the manufactured home is or will be permanently affixed must be identical, provided, however, that the owner of the manufactured home, if not the owner of the real property, is in possession of the real property under the terms of a lease in recordable form that has a term that continues for at least twenty years after the date of execution and the consent of the lessor of the real property;
- The person having an ownership interest in the manufactured home shall execute and record with the recorder of the county in which the real property is located an affidavit of affixation as provided in subsection 3 and satisfies the other applicable requirements of this section; and
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Upon receipt of a recorded copy of the affidavit of affixation under subsection 5, a person designated in the affidavit for filing with the department of transportation shall file the recorded copy of the affidavit of affixation with the department of transportation, except that:
- In a circumstance described in item 1 of subparagraph a of paragraph 4 of subdivision a of subsection 3, the recorded copy of the affidavit of affixation and the original manufacturer’s certificate of origin, each as recorded in the county in which the real property is located, must be filed with the department of transportation under subsection 1 of section 39-05-35;
- In a circumstance described in item 1 of subparagraph b of paragraph 4 of subdivision a of subsection 3, the recorded copy of the affidavit of affixation, as recorded in the county in which the real property is located, and the original certificate of title must be filed with the department of transportation under subsection 2 of section 39-05-35; and
- In a circumstance described in item 2 of subparagraph a of paragraph 4 of subdivision a of subsection 3, item 2 of subparagraph b of paragraph 4 of subdivision a of subsection 3, or paragraph 6 of subdivision a of subsection 3, the recorded copy of the affidavit of affixation, as recorded in the county in which the real property is located, and an application for confirmation of conversion must be filed with the department of transportation under subsection 3 of section 39-05-35.
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An affidavit of affixation must contain or be accompanied by:
- The name of the manufacturer, the make, the model name, the model year, the dimensions, the manufacturer’s serial number of the manufactured home, and whether the manufactured home is new or used;
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- A statement that the party executing the affidavit is the owner of the real property described in the affidavit; or
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If not the owner of the real property:
- A statement that the party executing the affidavit is in possession of the real property under the terms of a lease in recordable form that has a term that continues for at least twenty years after the date of execution of the affidavit; and
- The consent of the lessor of the real property endorsed upon or attached to the affidavit and acknowledged or proved in the manner as to entitle a conveyance to be recorded;
- The street address and the legal description of the real property to which the manufactured home is or will be permanently affixed;
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If the manufactured home is not covered by a certificate of title, a statement by the owner to that effect, and either:
- A statement by the owner of the manufactured home that the manufactured home is covered by a manufacturer’s certificate of origin, the date the manufacturer’s certificate of origin was issued, the manufacturer’s serial number, and a statement that annexed to the affidavit of affixation is the original manufacturer’s certificate of origin for the manufactured home, duly endorsed to the owner of the manufactured home, and that the owner of the manufactured home will surrender the manufacturer’s certificate of origin to the department of transportation; or
- A statement that the owner of the manufactured home, after diligent search and inquiry, is unable to produce the original manufacturer’s certificate of origin for the manufactured home and that the owner of the manufactured home will apply to the department of transportation for a confirmation of conversion of the manufactured home; or
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If the manufactured home is covered by a certificate of title, either:
- A statement by the owner of the manufactured home that the manufactured home is covered by a certificate of title, the date the title was issued, the title number, and that the owner of the manufactured home will surrender the title; or
- A statement that the owner of the manufactured home, after diligent search and inquiry, is unable to produce the certificate of title for the manufactured home and that the owner of the manufactured home will apply to the department of transportation for a confirmation of conversion of the manufactured home;
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If the manufactured home is not covered by a certificate of title, a statement by the owner to that effect, and either:
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A statement whether the manufactured home is subject to one or more security interests or liens and:
- If the manufactured home is subject to one or more security interests or liens, the name and address of each party holding a security interest in or lien on the manufactured home, including each holder shown on any certificate of title issued by the department of transportation, the original principal amount secured by each security interest or lien, and a statement that the security interest or lien will be released; or
- A statement that each security interest in or lien on the manufactured home, if any, has been released, together with due proof of each release;
- If the manufactured home is not covered by a manufacturer’s certificate of origin or a certificate of title, a statement by the owner of the manufactured home to that effect and that the owner of the manufactured home will apply to the department of transportation for a confirmation of conversion of the manufactured home;
- A statement that the manufactured home is or will be permanently affixed to the real property;
- If the party executing the affidavit acquired the manufactured home before the affixation of the manufactured home to the real property, that party shall complete the statement required by subsection 2 of section 11-18-02.2; and
- The name and address of a person designated for filing the recorded copy of the affidavit of affixation with the department of transportation to whom the recorder shall return the recorded copy of the affidavit of affixation after the affidavit has been duly recorded in the real property records as provided in subsection 5.
- An affidavit of affixation must be duly acknowledged or proved in like manner as to entitle a conveyance to be recorded, and when so acknowledged or proved and upon payment of the lawful recording fees, the recorder shall immediately cause the affidavit of affixation and any attachments to the affidavit to be duly recorded and indexed under chapter 47-19.
- The affidavit of affixation must be accompanied by an applicable fee for recording and issuing a recorded copy of the affidavit.
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An affidavit of affixation must contain or be accompanied by:
- The act of permanently affixing a manufactured home to real property or the recording of the affidavit of affixation does not impair the rights of a holder of a security interest in or lien on a manufactured home perfected as provided in section 35-01-05.1, unless and until the due filing with and acceptance by the department of transportation of an application to surrender the title as provided in subsection 1 of section 39-05-35 and the release of the security interest or lien as provided in section 39-05-16.1. Upon the filing of a release, the security interest or lien perfected under section 35-01-05.1 is terminated.
- The affidavit of affixation must be presented for recording pursuant to chapter 47-19, together with the fees provided by law. Upon receipt from the recorder of a copy of the recorded affidavit of affixation by the person presenting the affidavit for recording, that person shall deliver for filing to the department of transportation the copy of the affidavit of affixation and the other documents as provided in subdivision d of subsection 2.
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A manufactured home is deemed to be real property when all of the following events have occurred:
- The home is permanently affixed to land as provided in subsection 1;
- An affidavit of affixation conforming to the requirements of subsection 3 has been recorded in the conveyance records in the office of the recorder in the county where the manufactured home is permanently affixed;
- A copy of the recorded affidavit of affixation has been delivered for filing to the department of transportation as provided in subsection 5; and
- The requirements of subsections 1 through 3 of section 39-05-35, as applicable, have been satisfied.
- Upon the satisfaction of the requirements of subsection 6, the manufactured home is deemed to be real property; any mortgage, deed of trust, lien, or security interest that can attach to land, buildings erected on the land, or fixtures affixed to the land attach as of the date of its recording in the same manner as if the manufactured home were built from ordinary building materials onsite. Title to the manufactured home must be transferred by deed or other form of conveyance that is effective to transfer an interest in real property, together with the land to which the structure has been affixed. The manufactured home is deemed to be real property and is governed by the laws applicable to real property and the department of transportation has no further authority or jurisdiction over the conveyance or encumbrance of the manufactured home.
- Except as provided in subsections 2, 3, 5, 6, and 7, an affidavit of affixation is not necessary or effective to convey or encumber a manufactured home or to change the character of the manufactured home to real property. An agreement by a party to the transaction by which the requirements of this subsection are waived is void as contrary to public policy.
- Nothing in this section impairs any rights existing under law before July 1, 2009, of anyone claiming an interest in a manufactured home.
Source:
S.L. 2009, ch. 327, § 12; 2017, ch. 89, § 2, eff August 1, 2017; 2017, ch. 261, §§ 3, 4, 5, eff August 1, 2017.
Note.
Section 47-10-27 was amended 4 times by the 2017 Legislative Assembly. Pursuant to Section 1-02-09.1, the section is printed above to harmonize and give effect to the changes made in Section 2 of Chapter 89, Session Laws 2017, House Bill 1250; and Sections 3, 4, and 5 of Chapter 261, Session Laws 2017, House Bill 1219.
47-10-28. Mobile home park — Ownership — Transfer of ownership — Tenant rights — Penalty.
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A person that owns or purchases an existing mobile home park shall:
- Obtain an annual license under section 23-10-03;
- Designate an official local office, except if the mobile home park contains fewer than twenty-six lots, which must be operational on the fifth business day after the change of ownership;
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The mobile home park shall:
- Have a designated telephone number manned on weekdays between the hours of eight a.m. and five p.m.;
- Have an operational emergency contact number manned at all times;
- Designate at least one individual for the property who has the authority to make decisions on behalf of and perform, or direct the performance of, duties imposed on the owner; and
- Provide a tenant with the contact information of the individual under paragraph 3;
- Provide written notice to a tenant of the mobile home park regarding the change of ownership within five business days after the change of ownership becomes effective. The written notice must include the information required under subdivision c; and
- Acknowledge receipt of tenant inquiries or complaints regarding the park, pursuant to section 23-10-10.1, within two business days of receiving the inquiry or complaint.
- A person that owns or purchases an existing mobile home park may not require a tenant who owns a mobile home located on the property to sell or transfer ownership of the home to the owner of the mobile home park, except as otherwise provided by law.
- A person that owns or purchases an existing mobile home park shall provide a tenant advance written notice of any modifications to park rules or regulations at least thirty days before the date the modifications take effect. Except for the rules and regulations under subsections 4 and 5, upon the effective date of modifications to park rules and regulations, an owner shall provide a tenant who owns a dwelling unit that fails to comply with the park rules and regulations written notice of the failure to comply and provide the tenant three months to remedy the failure or vacate the premises before initiating an action for eviction against the tenant. During the three-month period the tenant shall comply with the park rules and regulations that were in effect before the modifications became effective, including the payment of rent and any other financial obligations under the terms of the lease. During the three-month period, if the tenant provides the owner a signed document from a person in the business of relocating mobile homes declaring it is not possible to relocate the tenant’s dwelling unit within the three-month period, the three-month period must be extended to a date when the dwelling unit can be relocated or the date that is two months after the end of the three-month period, whichever date occurs first.
- A person that owns or purchases an existing mobile home park shall provide a tenant advance written notice of any modifications to park rules and regulations addressing sanitation and safety concerns at least thirty days before the date the modifications take effect.
- A person that owns or purchases an existing mobile home park shall provide a tenant advance written notice at least thirty days before implementing a rule or regulation regarding the removal of a tongue hitch, or any other modification to the dwelling unit to comply with state or federal housing or financing requirements.
- Mobile home park rules in effect on the date advance written notice regarding modifications is provided to a tenant remain in effect until the date the modified rules or regulations take effect.
- A person that purchases an existing mobile home park may not increase the monthly tenant rental obligation for six months if the rental amount was increased within the sixty-day period before the date the new owner acquired ownership of the park.
- A person that owns or purchases an existing mobile home park may purchase utility services, including water and sewer services on behalf of a tenant, and include the amount in the monthly rental obligation or bill the tenant as a separate charge based on actual usage. An owner may not charge a tenant more than the actual cost per unit amount paid by the landlord to the utility service provider, except for a reasonable administrative fee that may not exceed three dollars. An owner may not charge or back charge for the utility services of a tenant paying for the services as a portion of the tenant’s monthly rental obligation, unless the cost of providing the services increases. If the cost of providing utility services increases, an owner of a mobile home park may charge a tenant a reasonable amount to cover the increased cost of providing the service. The owner shall provide the tenant access to the records of meter readings taken at the mobile home lot of the tenant.
- A person that violates a provision of this section is subject to a civil penalty not exceeding one thousand dollars or actual damages, whichever is less, plus reasonable attorney’s fees and costs.
Source:
S.L. 2021, ch. 335, § 1, eff August 1, 2021.
CHAPTER 47-10.1 Agricultural Land Ownership by Aliens
47-10.1-01. Definitions.
In this chapter, unless the context or subject matter otherwise requires:
- “Agricultural land” means land capable of use in the production of agricultural crops, livestock or livestock products, poultry or poultry products, milk or dairy products, or fruit and other horticultural products but does not include any land zoned by a local governmental unit for a use other than, and nonconforming with, agricultural use, but does not include any oil, gas, coal, or other minerals underlying the land, any interest in minerals, separate from the surface, whether acquired by lease or otherwise, or any easements or tracts of land acquired in connection with the extraction, refining, processing, or transportation of minerals.
- “Interest in agricultural land” includes any leasehold interest.
Source:
S.L. 1979, ch. 484, § 1.
Collateral References.
Construction and application of terms “agricultural,” “farm,” “farming,” or the like, in zoning regulations, 38 A.L.R.5th 357.
47-10.1-02. Restriction on acquisition — Exceptions.
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An individual who is not a citizen of the United States, a citizen of Canada, or a permanent resident alien of the United States may not acquire directly or indirectly any interest in agricultural land unless:
- The individual is an alien entitled to enter the United States under the provisions of a treaty of commerce and navigation between the United States and the foreign state of which the individual is a national, solely to develop and direct the operations of an enterprise in which the individual has invested or to direct the operations of an enterprise in which the individual is actively in the process of investing a substantial amount of capital;
- The individual resides in this state for at least ten months out of every year;
- The individual actively participates in the operation of the agricultural land;
- The agricultural landholding does not exceed six hundred forty acres [258.99 hectares]; and
- The agricultural landholding includes a dairy operation.
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An individual who is permitted to acquire an interest in agricultural land under subsection 1 shall:
- Notify the agriculture commissioner of any land acquisition within thirty days of the acquisition; and
- Annually provide the agriculture commissioner with a list of all addresses at which the individual resided during the previous year and the dates during which the individual resided at each address.
- If an individual ceases to meet the exceptions provided for in subsection 1, the individual shall dispose of the agricultural land within twenty-four months.
- A partnership, limited partnership, limited liability company, trustee, or other business entity may not, directly or indirectly, acquire or otherwise obtain any interest, whether legal, beneficial, or otherwise, in any title to agricultural land unless the ultimate beneficial interest of the entity is held directly or indirectly by citizens of the United States or permanent resident aliens of the United States.
- This section does not apply to agricultural land that may be acquired by devise, inheritance, as security for indebtedness, by process of law in the collection of debts, or by any procedure for the enforcement of a lien or claim thereon, whether created by mortgage or otherwise; provided, that all agricultural land acquired in the collection of debts or by the enforcement of a lien or claim must be disposed of within three years after acquiring ownership if the acquisition would otherwise violate this section.
- This section does not apply to a foreign corporation or a foreign limited liability company which acquires agricultural land for use as an industrial site when construction contracts are entered into by the corporation or limited liability company within one hundred fifty days after acquisition of the land; provided, that this exception applies only to so much agricultural land as is reasonably necessary for industrial purposes. A foreign corporation or a foreign limited liability company which owns agricultural land for industrial purposes but which discontinues using the land for industrial purposes shall dispose of the land as provided by chapter 10-06.1. A foreign corporation or foreign limited liability company shall dispose of agricultural land acquired for industrial purposes within one year after acquisition if construction contracts are not entered into within one hundred fifty days after acquisition of the land.
- This section does not apply to citizens or subjects of a foreign country whose rights to hold land are secured by treaty or to common carriers by railroad subject to the jurisdiction of the interstate commerce commission.
Source:
S.L. 1979, ch. 484, § 2; 1981, ch. 460, § 1; 1993, ch. 54, § 106; 1999, ch. 50, § 66; 2005, ch. 387, § 1.
47-10.1-03. Recording. [Repealed]
Repealed by S.L. 2005, ch. 388, § 1.
47-10.1-04. Enforcement.
If the attorney general has reason to believe that any person is violating section 47-10.1-02, the attorney general shall commence an action in the district court in which any agricultural land relative to the violation is situated, or if situated in two or more counties, in the district court for that county in which a substantial part of the land is situated. The attorney general shall file for record with the recorder in each county in which any portion of the land is located a notice of the pendency of the action. If the court finds that the land in question is being held in violation of section 47-10.1-02, it shall enter an order so declaring. The attorney general shall file for record any such order with the recorder of each county in which any portion of the land is located. Thereafter, the person, partnership, limited partnership, limited liability company, trustee, or other business entity owning the land has a period of one year from the date of the order to divest itself of the lands. The one-year limitation period is deemed a covenant running with the title to the land against any grantee or assignee. Any land not divested within the time prescribed shall be sold at public sale in the manner prescribed by law for the foreclosure of a real estate mortgage by action. In addition, any prospective or threatened violation may be enjoined by an action brought by the attorney general in the manner provided by law. No title to land shall be invalid or subject to forfeiture by reason of the alienage of any former owner or person having a former interest therein.
Source:
S.L. 1979, ch. 484, § 4; 1993, ch. 54, § 106; 2001, ch. 120, § 1.
47-10.1-05. Reports.
The commissioner shall monitor for compliance with this chapter all reports transmitted to the commissioner pursuant to the Agricultural Foreign Investment Disclosure Act of 1978 [7 U.S.C. 3501 et seq.]. The commissioner shall make the reports available to the public.
Source:
S.L. 1979, ch. 484, § 5; 1993, ch. 54, § 106; 2011, ch. 339, § 1.
47-10.1-06. Penalty.
Any person violating section 47-10.1-02 is guilty of a class A misdemeanor.
Source:
S.L. 1979, ch. 484, § 6; 2011, ch. 339, § 2.
CHAPTER 47-10.2 Escrow Accounts
47-10.2-01. Definitions.
In sections 47-10.2-01 through 47-10.2-03, unless the context or subject matter otherwise requires:
- “Borrower” means the obligor under a residential mortgage held by a secondary mortgagee.
- “Excess amount” means any amount received in an escrow account during a calendar year in excess of three hundred dollars plus the amount necessary to pay real estate taxes, special assessments, and insurance premiums during that calendar year.
- “Secondary mortgagee” means a successor mortgagee not residing or domiciled in this state who purchased the interest originally belonging to the mortgagee who originated a loan, under which an escrow is required to assure payment of obligations including property taxes, special assessments, and insurance premiums, if that loan is secured by a first lien real estate mortgage or equivalent security interest in a dwelling that the borrower uses as a principal place of residence in this state, not including a mobile home.
- “Servicer” means a person or entity maintaining an escrow account for a secondary residential mortgagee.
Source:
S.L. 1991, ch. 486, § 1.
47-10.2-02. Notice of excess escrow payments.
If an escrow account is maintained by the servicer of a secondary residential mortgage for a secondary mortgagee, and the account contains an excess amount, the servicer shall provide written notice to the borrower, on or before March first of the following year, of the escrow account status. The information provided to the borrower must include the balance in the escrow account after the annual payment of taxes and special assessments.
Source:
S.L. 1991, ch. 486, § 2.
47-10.2-03. Application of excess escrow payments.
Upon receipt of the written notice under section 47-10.2-02, the borrower may, within thirty days after the date of the notice, elect in a written request to the servicer one of the following options:
- Refund of all or part of the excess amount; or
- Retention of all or part of the excess amount in the escrow account.
If the borrower does not advise the servicer in writing within the time provided in this section, the servicer may continue maintenance of the escrow account in the same manner until the next report to the borrower under sections 47-10.2-01 through 47-10.2-03. If the borrower advises the servicer of an election within the time prescribed in sections 47-10.2-01 through 47-10.2-03, the servicer must comply with the borrower’s election within thirty days of the election.
Source:
S.L. 1991, ch. 486, § 3.
47-10.2-04. Payments from escrow — Notice — Liability of lender or escrow agent.
-
If the borrower notifies the escrow agent as provided in subsection 2, is current in loan payments, and funds in the escrow account are sufficient, the borrower may direct the escrow agent under the borrower’s loan to do any of the following:
- Pay the property taxes by December thirty-first, if the escrow agent has received a tax statement for that property by December twentieth.
- Pay the property taxes on or before February fifteenth to qualify for the discount for early payment under section 57-20-09.
- Pay the property taxes when due.
- To require the escrow agent to make payments in any of the manners specified in subsection 1, the borrower shall send, by December first, written notice to the escrow agent specifying the manner in which the borrower wants the escrow agent to make payments under subsection 1. Once notified, the escrow agent shall annually make payments in that manner unless the borrower is not current in loan payments, unless funds in the escrow account are not sufficient, or unless otherwise notified in writing by the borrower by December first. If the borrower has never provided a written notice to the escrow agent, the escrow agent shall pay property taxes as provided in subdivision b of subsection 1.
- An escrow agent who fails to comply with a directive of a borrower under subsection 1 made within the time limitations under subsection 2 is liable to the borrower for five hundred dollars plus actual damages, costs, and reasonable attorney fees.
-
In this section, unless the context or subject matter otherwise requires:
- “Escrow agent” means a person who receives escrow payments on behalf of itself or another person.
- “Loan” means a loan under which an escrow is required by the lender to assure payment of property taxes and which is secured by a first lien real estate mortgage or equivalent security interest in a dwelling that the borrower uses as a principal place of residence, not including a mobile home.
Source:
S.L. 1991, ch. 109, §§ 2, 3.
47-10.2-05. Annual escrow account statement.
Each residential mortgagee, including any insurance company with articles of incorporation filed under section 26.1-01-03 or which is required to obtain a certificate of authority under section 26.1-01-05, intending to maintain an escrow account for the payment of taxes, assessments, insurance premiums, and other charges upon the mortgagor’s residence shall furnish annually each mortgagor with a detailed statement showing all debits and credits to the account.
Source:
S.L. 1991, ch. 90, § 3; 2003, ch. 71, § 4.
CHAPTER 47-11 Personal Property Transfers
47-11-01. Mode of transfer — General provisions.
The mode of transferring personal property other than the beneficial interest in an express trust is regulated, except as otherwise specifically provided in this title, in title 41.
Source:
Civ. C. 1877, § 635; R.C. 1895, § 3551; R.C. 1899, § 3551; R.C. 1905, § 4989; C.L. 1913, § 5534; R.C. 1943, § 47-1101; S.L. 1971, ch. 452, § 1; 1979, ch. 187, § 91.
Note.
The Uniform Consumer Credit Code has not been enacted by the Legislative Assembly.
DECISIONS UNDER PRIOR LAW
Analysis
Acceptance.
Under an executory contract, no title passed until the buyer accepted. Nichols & Shepard Co. v. Paulson, 6 N.D. 400, 71 N.W. 136, 1897 N.D. LEXIS 14 (N.D. 1897).
Until it was accepted, no title to a threshing machine passed under an agreement to purchase which provided that it might be returned if defective. Colean Mfg. Co. v. Feckler, 20 N.D. 188, 126 N.W. 1019, 1910 N.D. LEXIS 77 (N.D. 1910).
Identification of Like Property.
On the sale of personal property mixed with like property, separation of the part sold from the mass was not necessary for title to pass if the parties intended that title pass and the property sold had been identified. O'Keefe v. Leistikow, 14 N.D. 355, 104 N.W. 515, 1905 N.D. LEXIS 56 (N.D. 1905).
Order for Goods.
An order for goods passed no right of property therein. Sunshine Cloak & Suit Co. v. Roquette Bros., 30 N.D. 143, 152 N.W. 359, 1915 N.D. LEXIS 118 (N.D. 1915).
Vesting of Title.
The title to property would not pass so long as the contract of sale made by an agent in excess of his authority remained executory. Westby v. J. I. Case Threshing Mach. Co., 21 N.D. 575, 132 N.W. 137, 1911 N.D. LEXIS 129 (N.D. 1911).
Under an executory agreement where delivery and acceptance, vesting of title and payment were concurrent acts, the title did not vest until delivery and acceptance. Hart-Parr Co. v. Finley, 31 N.D. 130, 153 N.W. 137 (1915), explained, Orfield v. Harney, 33 N.D. 568, 157 N.W. 124, 1916 N.D. LEXIS 89 and Slimmer v. Martin, 42 N.D. 255, 172 N.W. 829, 1919 N.D. LEXIS 148 (N.D. 1919).
Where pursuant to the terms of an executory contract materials were to be furnished and labor performed, the contract was not divisible as between the material and labor so as to pass title to the materials before the required labor was performed, unless provided in the contract. Kopald Elec. Co. v. Mandan Creamery & Produce Co., 76 N.D. 503, 37 N.W.2d 253, 1949 N.D. LEXIS 72 (N.D. 1949).
47-11-02. Interest in express trusts — Operation of law or written instrument required.
The beneficial interest in an express trust can be transferred only by operation of law or by a written instrument subscribed by the person making the transfer or by the person’s agent.
Source:
Civ. C. 1877, § 634; R.C. 1895, § 3550; R.C. 1899, § 3550; R.C. 1905, § 4988; C.L. 1913, § 5533; R.C. 1943, § 47-1102; S.L. 1971, ch. 452, § 2.
Derivation:
Cal. Civ. C., 1135.
Notes to Decisions
Title in Trust.
Where the title to a boat was placed in two persons as trustees, to be held by them as part owners and for coowners, a bill of sale executed by the coowners would pass to the purchaser no title beyond the equitable interests of such coowners as beneficiaries of the trust. The Eclipse, 30 N.W. 159, 4 Dakota 218, 1886 Dakota LEXIS 19 (Dakota 1886).
47-11-03. When title passes. [Repealed]
Repealed by S.L. 1971, ch. 452, § 3.
47-11-04. Executory agreement. [Repealed]
Repealed by S.L. 1971, ch. 452, § 3.
47-11-05. Transfer by agent — Legal effect — Limitations. [Repealed]
Repealed by S.L. 1971, ch. 452, § 3.
47-11-06. Gift defined.
A gift is a transfer of personal property made voluntarily and without consideration.
Source:
Civ. C. 1877, § 639; R.C. 1895, § 3555; R.C. 1899, § 3555; R.C. 1905, § 4993; C.L. 1913, § 5538; R.C. 1943, § 47-1106.
Derivation:
Cal. Civ. C., 1146.
Cross-References.
Uniform Anatomical Gift Act, see N.D.C.C. ch. 23-06.2.
Uniform Transfers to Minors Act, see N.D.C.C. ch. 47-24.1.
Uniform Probate Code, gifts as advancements or satisfaction of devise, see N.D.C.C. §§ 30.1-04-10, 30.1-09-12.
Notes to Decisions
Acceptance Presumed.
Acceptance of a gift is presumed, in absence of condition to be performed by donee, especially when gift is from parent to child and operates entirely to donee’s benefit. In re Estate of Paulson, 219 N.W.2d 132, 1974 N.D. LEXIS 213 (N.D. 1974).
Bill of Sale.
Where husband desires to give his personal property to his wife, the execution and delivery of a bill of sale thereof is equivalent to a delivery of the property itself. Lenihan v. Meyer, 111 N.W.2d 696, 1961 N.D. LEXIS 101 (N.D. 1961).
Delivery of Gift.
Delivery of a gift may be actual or constructive. In re Estate of Paulson, 219 N.W.2d 132, 1974 N.D. LEXIS 213 (N.D. 1974).
Joint Tenancy.
Stock owner, by causing stock to be reissued to herself and others as joint tenants, effected valid gift inter vivos even though she retained possession of new stock certificates and received the income during her lifetime. In re Estate of Paulson, 219 N.W.2d 132, 1974 N.D. LEXIS 213 (N.D. 1974).
47-11-07. Gift — Writing or delivery required.
An oral gift is not valid unless the means of obtaining possession and control of the thing are given, nor, if it is capable of delivery, unless there is an actual or symbolical delivery of the thing to the donee.
Source:
Civ. C. 1877, § 640; R.C. 1895, § 3556; R.C. 1899, § 3556; R.C. 1905, § 4994; C.L. 1913, § 5539; R.C. 1943, § 47-1107.
Derivation:
Cal. Civ. C., 1147.
Notes to Decisions
Claiming Gift After Death of Donor.
Where a claim of a gift is not asserted until after the death of the donor, the evidence must be clear and convincing of every element requisite to constitute a gift. In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
Completed Gift.
To constitute a valid gift of personal property inter vivos, the delivery of the property must clearly appear and the donee must lose all control over the same. Luther v. Hunter, 7 N.D. 544, 75 N.W. 916, 1898 N.D. LEXIS 102 (N.D. 1898).
A verbal gift is invalid if it is not accompanied by a transfer of possession or by delivery, actual or symbolical. Ramsdell v. Warner, 48 N.D. 96, 183 N.W. 281, 1921 N.D. LEXIS 14 (N.D. 1921).
A completed “gift inter vivos” is a transfer of property made voluntarily and without consideration, effective immediately and irrevocably on unconditional delivery actual or symbolical, having regard to the circumstances and nature of the property. Reel v. Hansboro State Bank, 52 N.D. 182, 201 N.W. 861, 1924 N.D. LEXIS 112 (N.D. 1924); First Nat'l Bank & Trust Co. v. Green, 66 N.D. 160, 262 N.W. 596, 1935 N.D. LEXIS 182 (N.D. 1935).
To constitute a valid, effective gift inter vivos there must be an intention on the part of the donor to then and there transfer title to the property to the donee, coupled with an actual or constructive delivery of the property of a nature sufficient to divest the donor of all dominion over the property and to invest the donee therewith. Zeman v. Mikolasek, 75 N.D. 41, 25 N.W.2d 272, 1947 N.D. LEXIS 46 (N.D. 1947); In re Estate of Kaspari, 71 N.W.2d 558, 1955 N.D. LEXIS 123 (N.D. 1955).
Conflict of Law.
As this section is a general provision dealing with all oral gifts, while N.D.C.C. ch. 30.1-31 contains specific provisions governing joint accounts and disposition of funds remaining on deposit at death, any conflict between this section and N.D.C.C. ch. 30.1-31 would be resolved in favor of the latter. 508 N.W.2d 360.
Gift Not Found.
Transfer of rental signs from a rental sign business to a sign company did not constitute an oral gift confirmed by a written agreement in light of ambiguity in the transfer agreement, as extrinsic evidence tended to establish that the transfer document was not intended to give ownership interest in the signs to the company but to allow the company to use the signs; therefore, the trial court did not err in dismissing the sign company owner’s suit for conversion after the signs and letters were taken by the rental sign business. Doeden v. Stubstad, 2008 ND 165, 755 N.W.2d 859, 2008 N.D. LEXIS 165 (N.D. 2008).
Collateral References.
Opening savings account in sole name of another, without complete surrender of passbook, as a gift, 1 A.L.R.2d 538.
Survivor’s right to contents of safe deposit box leased or used jointly with another, 14 A.L.R.2d 948.
Corporate stock, necessity of delivery of stock certificate to complete valid gift of, 23 A.L.R.2d 1171.
Bill or note of third person, necessity of delivery of, by way of gift, 25 A.L.R.2d 642.
Life insurance policy, sufficiency of delivery to constitute gift of, 33 A.L.R.2d 273, 289.
Retention of possession as affecting gift by coowner of United States Savings Bonds, 37 A.L.R.2d 1226.
Delivery as element of gift of donor’s own check, 38 A.L.R.2d 594, 605.
Tangible chattels or securities, delivery as essential to gift of, by written instrument, 48 A.L.R.2d 1405.
Suicide, sufficiency of delivery of gift made in contemplation of, 60 A.L.R.2d 575.
Delivery as requisite of gift of debt to debtor, 63 A.L.R.2d 259.
Joint lease of safe deposit box as evidence in support or denial of gift inter vivos of contents thereof, 40 A.L.R.3d 462.
Death of donor: delivery of personalty to third person with directions to deliver to donee after donor’s death as valid gift, 57 A.L.R.3d 1083.
47-11-08. Gift irrevocable — Exception.
A gift, other than a gift in view of death, cannot be revoked by the giver.
Source:
Civ. C. 1877, § 641; R.C. 1895, § 3557; R.C. 1899, § 3557; R.C. 1905, § 4995; C.L. 1913, § 5540; R.C. 1943, § 47-1108.
Derivation:
Cal. Civ. C., 1148.
Collateral References.
Void marriage: rights of party to void marriage in respect of transfers or gifts to other in mistaken belief marriage was valid, 14 A.L.R.2d 918.
Marriage: gift or grant to one upon marriage, if married, payable at marriage, or the like, as vested or contingent, 30 A.L.R.2d 127.
Rights in respect of engagement and courtship presents when marriage does not ensue, 44 A.L.R.5th 1.
47-11-09. Gift in view of death defined.
A gift in view of death is one which is made in contemplation, fear, or peril of death and with intent that it shall take effect only in case of the death of the giver.
Source:
Civ. C. 1877, § 642; R.C. 1895, § 3558; R.C. 1899, § 3558; R.C. 1905, § 4996; C.L. 1913, § 5541; R.C. 1943, § 47-1109.
Derivation:
Cal. Civ. C., 1149.
Notes to Decisions
Certificate of Deposit.
A certificate of deposit payable to a designated payee or order and not endorsed may be the subject of a gift causa mortis. Rosenau v. Merchants' Nat'l Bank, 56 N.D. 123, 216 N.W. 335, 1927 N.D. LEXIS 80 (N.D. 1927).
Delivery Necessary.
A depositor indicating by a memorandum the desired disposition of a deposit after death did not make a gift in view of death. McGillivray v. First Nat'l Bank, 56 N.D. 152, 217 N.W. 150, 1927 N.D. LEXIS 85 (N.D. 1927).
Delivery to Third Person.
Where a depositor, expecting death, delivered a key to a third person who was directed to get the certificate of deposit for the donees, there was a sufficient showing of a present intention to make a gift causa mortis. Rosenau v. Merchants' Nat'l Bank, 56 N.D. 123, 216 N.W. 335, 1927 N.D. LEXIS 80 (N.D. 1927).
Unconditional Delivery.
A gift made in contemplation of death with the understanding that if the donor does not die the property will revert is a gift causa mortis. Zuber v. Erickson, 58 N.D. 322, 226 N.W. 510, 1929 N.D. LEXIS 213 (N.D. 1929).
Collateral References.
Life insurance policy as subject of gift causa mortis, 33 A.L.R.2d 273, 289.
Donor’s own check as subject of gift causa mortis, 38 A.L.R.2d 594, 605.
Husband’s gift causa mortis as fraud on wife, 49 A.L.R.2d 521.
Suicide, nature of gift made in contemplation of, 60 A.L.R.2d 575.
Gift of debt to debtor, 63 A.L.R.2d 259.
Inclusion of funds in savings bank trust (Totten Trust) in determining surviving spouse’s interest in decedent’s estate, 64 A.L.R.3d 187.
47-11-10. Gift in view of death — Presumption.
A gift made during the last illness of the giver or under circumstances which naturally would impress the giver with an expectation of speedy death is presumed to be a gift in view of death.
Source:
Civ. C. 1877, § 643; R.C. 1895, § 3559; R.C. 1899, § 3559; R.C. 1905, § 4997; C.L. 1913, § 5542; R.C. 1943, § 47-1110.
Derivation:
Cal. Civ. C., 1150.
47-11-11. Gift in view of death — Revocable — Rights of bona fide purchaser.
A gift in view of death may be revoked by the giver at any time and is revoked by the giver’s recovery from the illness or escape from the peril under the presence of which it was made or by the occurrence of any event which would operate as a revocation of a will made at the same time. When the gift has been delivered to the donee, the rights of a bona fide purchaser from the donee before the revocation shall not be affected by the revocation.
Source:
Civ. C. 1877, § 644; R.C. 1895, § 3560; R.C. 1899, § 3560; R.C. 1905, § 4998; C.L. 1913, § 5543; R.C. 1943, § 47-1111.
Derivation:
Cal. Civ. C., 1151.
47-11-12. Gift in view of death — Effect of will.
A gift in view of death is not affected by a previous will nor by a subsequent will unless it expresses an intention to revoke the gift.
Source:
Civ. C. 1877, § 645; R.C. 1895, § 3561; R.C. 1899, § 3561; R.C. 1905, § 4999; C.L. 1913, § 5544; R.C. 1943, § 47-1112.
Derivation:
Cal. Civ. C., 1152.
47-11-13. Gift in view of death — Legacy as to creditors.
A gift in view of death must be treated as a legacy so far as it relates only to the creditors of the giver.
Source:
Civ. C. 1877, § 646; R.C. 1895, § 3562; R.C. 1899, § 3562; R.C. 1905, § 5000; C.L. 1913, § 5545; R.C. 1943, § 47-1113.
Derivation:
Cal. Civ. C., 1153.
Notes to Decisions
Administration of Estate.
The subject of a gift causa mortis is not part of the donor’s estate and the personal representative cannot claim it except in case of necessity for the payment of debts which could not be paid otherwise. Seybold v. Grand Forks Nat'l Bank, 5 N.D. 460, 67 N.W. 682, 1896 N.D. LEXIS 49 (N.D. 1896).
A gift causa mortis should be treated as a legacy for the purposes of paying the actual costs of administration and for the purpose of satisfying creditors, including proper claims for funeral expenses and last illness. Rosenau v. Merchants' Nat'l Bank, 56 N.D. 123, 216 N.W. 335, 1927 N.D. LEXIS 80 (N.D. 1927).
Fraudulent Conveyances.
Where deceased transferred property to his wife one day before he died and the conveyances divested the grantor of all his property and rendered his estate insolvent, the conveyances must be held to have been made in fraud of creditors. Johnson v. Rutherford, 28 N.D. 87, 147 N.W. 390, 1914 N.D. LEXIS 87 (N.D. 1914).
47-11-14. Transfer of personal property by grantor to grantor and others in joint tenancy.
Any person, firm, corporation, or limited liability company owning an interest either legal or equitable in any personal property may grant, transfer, sell, and convey the same as grantor to the grantor and any other person, firm, corporation, or limited liability company in joint tenancy with right of survivorship without the necessity of any intermediate transfer or grant to or through a third person, if such personal property is tangible and has a situs in this state, if the property is intangible and the transfer or grant is made in this state, and in all other cases if such transfer is subject to the laws of this state.
Source:
S.L. 1957, ch. 310, § 1; R.C. 1943, 1957 Supp., § 47-1114; S.L. 1993, ch. 54, § 106.
Cross-References.
Real property interest, transfer by grantor to himself and another in joint tenancy, see N.D.C.C. § 47-10-23.
Law Reviews.
North Dakota Joint Tenancies: Severance by Contract for Deed?, 42 N.D. L. Rev. 351 (1966).
47-11-15. Validation of transfers of personal property by grantor to grantor and others in joint tenancy.
Any transfer or grant of an interest either legal or equitable in personal property heretofore made by any person, firm, corporation, or limited liability company as grantor to the grantor and any other person, firm, corporation, or limited liability company in joint tenancy with right of survivorship when such transfer is subject to the laws of this state is hereby declared legal and valid.
Source:
S.L. 1957, ch. 310, § 2; R.C. 1943, 1957 Supp., § 47-1115; S.L. 1993, ch. 54, § 106.
47-11-16. Nontestamentary transfer between spouses — Presumption.
A nontestamentary transfer of personal property between spouses shall be presumed to be for a consideration, and not a gift, unless otherwise stated in writing at the time of transfer. This presumption is conclusive.
Source:
S.L. 1979, ch. 483, § 2.
CHAPTER 47-11.1 Uniform Disclaimer Under Nontestamentary Instruments Act [Repealed]
[Repealed by S.L. 1993, ch. 334, § 50; S.L. 1995, ch. 322, § 27]
CHAPTER 47-12 Loans of Personal Property for Use
47-12-01. Loan for use defined.
A loan for use is a contract by which a lender gives to a borrower the temporary possession and use of personal property and the borrower agrees to return the identical personal property to the lender at a future time without reward for its use.
Source:
Civ. C. 1877, § 1074; R.C. 1895, § 4041; R.C. 1899, § 4041; R.C. 1905, § 5488; C.L. 1913, § 6050; R.C. 1943, § 47-1201.
Derivation:
Cal. Civ. C., 1884.
47-12-02. Degree of care to be exercised by borrower.
A borrower for use shall exercise great care for the preservation in safety and in good condition of the personal property borrowed.
Source:
Civ. C. 1877, § 1076; R.C. 1895, § 4043; R.C. 1899, § 4043; R.C. 1905, § 5490; C.L. 1913, § 6052; R.C. 1943, § 47-1202.
Derivation:
Cal. Civ. C., 1886.
47-12-03. Degree of skill to be exercised by borrower.
A borrower for use is bound to have and exercise such degree of skill in the care of the personal property borrowed as the borrower causes the lender to believe the borrower to possess.
Source:
Civ. C. 1877, § 1078; R.C. 1895, § 4045; R.C. 1899, § 4045; R.C. 1905, § 5492; C.L. 1913, § 6054; R.C. 1943, § 47-1203.
Derivation:
Cal. Civ. C., 1888.
47-12-04. Humane treatment of animals.
One who borrows a living animal for use shall treat it with great kindness and provide everything necessary and suitable for its general well-being.
Source:
Civ. C. 1877, § 1077; R.C. 1895, § 4044; R.C. 1899, § 4044; R.C. 1905, § 5491; C.L. 1913, § 6053; R.C. 1943, § 47-1204.
Derivation:
Cal. Civ. C., 1887.
47-12-05. Retention of title and increase by lender.
A loan for use does not transfer the title to the personal property. Its total increase during the period of the loan belongs to the lender.
Source:
Civ. C. 1877, § 1075; R.C. 1895, § 4042; R.C. 1899, § 4042; R.C. 1905, § 5489; C.L. 1913, § 6051; R.C. 1943, § 47-1205.
Derivation:
Cal. Civ. C., 1885.
47-12-06. Use by borrower limited to anticipated purposes.
The borrower of personal property for use may use it for such purposes only as the lender might reasonably anticipate at the time of lending.
Source:
Civ. C. 1877, § 1080; R.C. 1895, § 4047; R.C. 1899, § 4047; R.C. 1905, § 5494; C.L. 1913, § 6056; R.C. 1943, § 47-1206.
Derivation:
Cal. Civ. C., 1890.
47-12-07. Lender’s consent necessary in a third-party transaction.
The borrower of personal property for use shall not part with it to a third person without the consent of the lender.
Source:
Civ. C. 1877, § 1081; R.C. 1895, § 4048; R.C. 1899, § 4048; R.C. 1905, § 5495; C.L. 1913, § 6057; R.C. 1943, § 47-1207.
Derivation:
Cal. Civ. C., 1891.
47-12-08. Expenses in connection with borrowed personal property to be borne by borrower — Exception.
The borrower of personal property for use must bear all expenses in connection therewith during the time the same is held under the loan, except such expenses as are necessary to preserve the property from unexpected and unusual injury. For such expense, the borrower is entitled to compensation from the lender who, however, may exonerate the lender by surrendering the property to the borrower.
Source:
Civ. C. 1877, § 1082; R.C. 1895, § 4049; R.C. 1899, § 4049; R.C. 1905, § 5496; C.L. 1913, § 6058; R.C. 1943, § 47-1208.
Derivation:
Cal. Civ. C., 1892.
47-12-09. Lender to indemnify borrower for damages caused by concealed defects.
The lender of personal property for use shall indemnify the borrower for damages caused by defects or vices in it about which the lender knew at the time of lending and concealed from the borrower.
Source:
Civ. C. 1877, § 1083; R.C. 1895, § 4050; R.C. 1899, § 4050; R.C. 1905, § 5497; C.L. 1913, § 6059; R.C. 1943, § 47-1209.
Derivation:
Cal. Civ. C., 1893.
Collateral References.
Tort liability of one renting or loaning airplane to another, 4 A.L.R.2d 1306.
Liability of bailor of automotive machine for personal injury or death due to defects therein, 46 A.L.R.2d 404.
Liability of owner or operator of motorboat for injury or damage, 63 A.L.R.2d 343.
Liability of owner of powerboat for injury or death allegedly caused by one permitted to operate boat by owner, 71 A.L.R.3d 1018.
47-12-10. Reparation of personal property by borrower.
A borrower for use must repair all deteriorations or injuries to the personal property borrowed which are occasioned by the borrower’s negligence, however slight.
Source:
Civ. C. 1877, § 1079; R.C. 1895, § 4046; R.C. 1899, § 4046; R.C. 1905, § 5493; C.L. 1913, § 6055; R.C. 1943, § 47-1210.
Derivation:
Cal. Civ. C., 1889.
47-12-11. Return of property on demand of lender.
The lender of personal property for use may require its return at any time even though the lender lent it for a specified time or purpose. If, on the faith of such an agreement, the borrower has made such arrangements that a return of the property before the time agreed upon would cause the borrower loss exceeding the benefit derived by the borrower from the loan, the lender shall indemnify the borrower for such loss if the lender compels such return and the borrower has not violated the borrower’s duty in any manner.
Source:
Civ. C. 1877, § 1084; R.C. 1895, § 4051; R.C. 1899, § 4051; R.C. 1905, § 5498; C.L. 1913, § 6060; R.C. 1943, § 47-1211.
Derivation:
Cal. Civ. C., 1894.
47-12-12. Time for return of personal property to lender.
If personal property is lent for use for a specified time or purpose, it must be returned to the lender without demand as soon as the time has expired or the purpose has been accomplished. In any other case, it need not be returned until demanded. The borrower of personal property for use shall return it to the lender at the place contemplated by the parties at the time of the lending, or if no particular place was contemplated by them, at the place where it was at the time of the lending.
Source:
Civ. C. 1877, §§ 1085, 1086; R.C. 1895, § 4052; R.C. 1899, § 4052; R.C. 1905, § 5499; C.L. 1913, § 6061; R.C. 1943, § 47-1212.
Derivation:
Cal. Civ. C., 1895, 1896.
CHAPTER 47-13 Loans of Personal Property for Exchange
47-13-01. Loan for exchange defined.
A loan for exchange is a contract by which one delivers personal property to another and the latter agrees to return to the lender a similar thing at a future time without reward for its use.
Source:
Civ. C. 1877, § 1087; R.C. 1895, § 4053; R.C. 1899, § 4053; R.C. 1905, § 5500; C.L. 1913, § 6062; R.C. 1943, § 47-1301.
Derivation:
Cal. Civ. C., 1902.
47-13-02. Loan for use or for exchange subject to provisions of chapter.
A loan which the borrower is allowed by the lender to treat as a loan for use or for exchange at the borrower’s option is subject to all the provisions of this chapter.
Source:
Civ. C. 1877, § 1088; R.C. 1895, § 4054; R.C. 1899, § 4054; R.C. 1905, § 5501; C.L. 1913, § 6063; R.C. 1943, § 47-1302.
Derivation:
Cal. Civ. C., 1903.
47-13-03. Title transferred to borrower.
By a loan for exchange, the title to the thing lent is transferred to the borrower, and the borrower must bear all the expenses in connection therewith and is entitled to all the increase thereof.
Source:
Civ. C. 1877, § 1089; R.C. 1895, § 4055; R.C. 1899, § 4055; R.C. 1905, § 5502; C.L. 1913, § 6064; R.C. 1943, § 47-1303.
Derivation:
Cal. Civ. C., 1904.
47-13-04. Lender may not require change in obligations.
A lender for exchange may not require the borrower to fulfill the borrower’s obligations at a time or in a manner different from that which originally was agreed upon.
Source:
Civ. C. 1877, § 1090; R.C. 1895, § 4056; R.C. 1899, § 4056; R.C. 1905, § 5503; C.L. 1913, § 6065; R.C. 1943, § 47-1304.
Derivation:
Cal. Civ. C., 1905.
47-13-05. Indemnity to borrower for concealed defects.
The lender of personal property for exchange shall indemnify the borrower for damages caused by defects or vices in it of which the lender knew at the time of the exchange and concealed from the borrower.
Source:
Civ. C. 1877, § 1091; R.C. 1895, § 4057; R.C. 1899, § 4057; R.C. 1905, § 5504; C.L. 1913, § 6066; R.C. 1943, § 47-1305.
Derivation:
Cal. Civ. C., 1906.
47-13-06. Time and place for return of personal property to lender.
If personal property is exchanged for a specific time or purpose, a similar article shall be returned to the lender without demand as soon as the time has expired or the purpose has been accomplished. In any other case, it need not be returned until demanded. The borrower of personal property for exchange shall return a similar article to the lender at the place contemplated by the parties at the time of the exchange, or if no particular place was contemplated by them, at the place where it was at the time of the exchange.
Source:
Civ. C. 1877, § 1091; R.C. 1895, § 4057; R.C. 1899, § 4057; R.C. 1905, § 5504; C.L. 1913, § 6066; R.C. 1943, § 47-1306.
Derivation:
Cal. Civ. C., 1906.
CHAPTER 47-14 Loans of Money
47-14-01. Loan of money defined.
A loan of money is a contract by which one delivers a sum of money to another and the latter agrees to return at a future time a sum equivalent to that which the person borrowed. A loan for mere use is governed by chapter 47-12.
Source:
Civ. C. 1877, § 1092; R.C. 1895, § 4058; R.C. 1899, § 4058; R.C. 1905, § 5505; C.L. 1913, § 6067; R.C. 1943, § 47-1401.
Derivation:
Cal. Civ. C., 1912.
Notes to Decisions
- Essential Terms of Oral Agreement.
- Interest Rate.
- Loan of Money.
- Missing Terms or Incidentals in Loan Agreement.
Essential Terms of Oral Agreement.
Essential terms of an oral contract to continue lending money in the future include the amount and duration of the loans, interest rates, and, where appropriate, the methods of repayment and collateral for the loans, if any. Taken alone, the absence of any one of these terms may not be of great significance; however, viewed collectively, their absence is fatal to the existence of a binding contract. Delzer v. United Bank, 459 N.W.2d 752, 1990 N.D. LEXIS 153 (N.D. 1990).
Interest Rate.
Interest rate of the alleged line of credit under oral agreement could have reasonably been inferred from bank’s prevailing lending rate in the farming and ranching sector. Delzer v. United Bank, 459 N.W.2d 752, 1990 N.D. LEXIS 153 (N.D. 1990).
Loan of Money.
For a case discussing the meaning of “loan of money” or “money loaned” within the context of antideficiency statutes, see Borsheim v. Owan, 467 N.W.2d 95, 1991 N.D. LEXIS 48 (N.D. 1991).
In a case involving the default of promissory notes, summary judgment was properly granted in favor of an assignee because the notes, which were executed to finance crops, constituted traditional loans of money since they used the terms “principal” and “interest,” rather than “credit extended” and “credit service charge”; therefore, they did not fall under the definition of revolving charge account agreements. AG Acceptance Corp. v. Glinz, 2004 ND 154, 684 N.W.2d 632, 2004 N.D. LEXIS 283 (N.D. 2004).
Missing Terms or Incidentals in Loan Agreement.
In order to constitute a transaction a loan, it is not essential that there be a promissory note or a specified rate of interest or due date. If money passes from one individual to another with the understanding that it is to be repaid, the law will supply the missing details. Hook v. Crary, 142 N.W.2d 140, 1966 N.D. LEXIS 187 (N.D. 1966).
Collateral References.
Loan broker’s right to commission on transactions consummated after termination of employment, 27 A.L.R.2d 1348.
Admissibility of party’s book accounts to prove loans or payments by person by or for whom they are kept, 13 A.L.R.3d 284.
Loan brokers: measure of damages recoverable by loan broker for breach of brokerage contract, 67 A.L.R.3d 1069.
Right to recover money lent for gambling purposes, 74 A.L.R.5th 369.
State Regulation of Payday Loans, 29 A.L.R.6th 461.
47-14-02. Repayment in current funds.
A borrower of money must pay the amount due in such money as is current at the time when the loan becomes due, whether such money is worth more or less than the actual money lent.
Source:
Civ. C. 1877, § 1093; R.C. 1895, § 4059; R.C. 1899, § 4059; R.C. 1905, § 5506; C.L. 1913, § 6068; R.C. 1943, § 47-1402.
Derivation:
Cal. Civ. C., 1913.
Collateral References.
Evidence as to financial condition of debtor as admissible on issue as to payment of debt, 9 A.L.R.2d 205.
Future agreement: validity and enforceability of contract which expressly leaves open for future agreement or negotiation the terms of payment for property, 68 A.L.R.2d 1221.
Admissibility of party’s book accounts to prove loans or payments by person by or for whom they are kept, 13 A.L.R.3d 284.
47-14-03. Loan presumes interest.
Whenever a loan of money is made, it is presumed to be made upon interest unless it is expressly stipulated otherwise in writing at the time it is made.
Source:
Civ. C. 1877, § 1094; R.C. 1895, § 4060; R.C. 1899, § 4060; R.C. 1905, § 5507; C.L. 1913, § 6069; R.C. 1943, § 47-1403.
Derivation:
Cal. Civ. C., 1914.
Notes to Decisions
Distribution of Revenue to Counties.
Excess moneys paid to certain counties through improper distribution under N.D.C.C. § 39-04-39 did not constitute loan from counties receiving too little, and this section did not apply. Richland County v. State, 180 N.W.2d 649, 1970 N.D. LEXIS 136 (N.D. 1970).
Money Loaned to Estate.
A widow is entitled to interest on sums advanced for use of the estate pending settlement. In re Korsmo's Estate, 56 N.D. 927, 220 N.W. 128, 1928 N.D. LEXIS 216 (N.D. 1928).
Real Estate Purchase Contract.
A contract containing an option to purchase real estate, which option makes no reference to interest, is controlled by this section and N.D.C.C. § 47-14-05. Kuhn v. Hamilton, 138 N.W.2d 604, 1965 N.D. LEXIS 107 (N.D. 1965).
47-14-04. Interest defined.
Interest is the compensation allowed for the use, or forbearance, or detention of money, or its equivalent.
Source:
Civ. C. 1877, § 1095; R.C. 1895, § 4061; R.C. 1899, § 4061; R.C. 1905, § 5508; C.L. 1913, § 6070; R.C. 1943, § 47-1404.
Derivation:
Cal. Civ. C., 1915.
Notes to Decisions
Interest As Damages.
The statute regarding the right to interest on the recovery of damages certain or capable of being made certain by calculation fixes interest as the measure of damages for the detention of money due and payable to another. Jacobson v. Mutual Benefit Health & Accident Ass'n, 70 N.D. 566, 296 N.W. 545, 1941 N.D. LEXIS 202, 1941 N.D. LEXIS 203 (N.D. 1941).
Where money is wrongfully withheld or used without the consent of the owner, interest may be awarded as compensation. Allen v. Miller, 84 N.W.2d 571, 1957 N.D. LEXIS 133 (N.D. 1957).
Just Compensation.
Where an owner’s property is damaged within the purview of section 14 of the constitution of the state, interest from the date of the damage is a part of the just compensation the owner is entitled to recover. Donaldson v. City of Bismarck, 71 N.D. 592, 3 N.W.2d 808, 1942 N.D. LEXIS 94 (N.D. 1942).
Special Assessments.
Special assessments bear interest at the legal rate per annum from the time of delinquency. Hackney v. Elliott, 23 N.D. 373, 137 N.W. 433, 1912 N.D. LEXIS 113 (N.D. 1912).
47-14-05. Legal rate of interest — Interest after maturity.
Interest for any legal indebtedness must be at the rate of six percent per annum unless a different rate not to exceed the rate specified in section 47-14-09 is contracted for in writing. Unless otherwise agreed by the parties in writing, all contracts must bear the same rate of interest after maturity as they bear before maturity. A charge for a late payment penalty may be imposed only if the amount of the late charge or the method of calculation of the late charge has been agreed to by the parties in the loan documents that are signed by the borrower.
Source:
S.L. 1890, ch. 184, § 1; 1893, ch. 131, § 1; R.C. 1895, § 4063; R.C. 1899, § 4063; R.C. 1905, § 5510; C.L. 1913, § 6072; S.L. 1915, ch. 176, § 1; 1919, ch. 166; 1925, ch. 155, § 1; 1925 Supp., §§ 6072, 6072a; S.L. 1935, ch. 157, § 1; R.C. 1943, § 47-1405; S.L. 1975, ch. 356, § 2; 1981, ch. 462, § 1; 1997, ch. 389, § 1; 2013, ch. 347, § 1.
Effective Date.
The 2013 amendment of this section by section 1 of chapter 347, S.L. 2013 became effective August 1, 2013.
Cross-References.
Interest rate on judgments, see N.D.C.C. § 28-20-34.
Notes to Decisions
- In General.
- Accounting Methods.
- Contract Enforced for Statutory Rate.
- Court’s Discretion.
- Interest After Maturity.
- Interest As Compensatory Damages.
- Limit on Finance Charge.
- Merchants.
- Monetary Awards in Divorce Actions.
- Prejudgment Interest.
- Property Settlement in Divorce Proceeding.
- Suretyship Liability.
In General.
Interest is proper for breach of contract. Troutman v. Pierce, Inc., 402 N.W.2d 920, 1987 N.D. LEXIS 270 (N.D. 1987).
Attorney was charging the client “service charges” on her bill before the bill was due in June 1998, when the attorney quit representing the client, which constituted compensation for the use of money, not compensation for damages for the wrongful detention of money, and triggered application of the usury statutes; the attorney charged the client an interest rate higher than that permitted by N.D.C.C. § 47-14-09 before he completed his representation of her in June 1998, which was the date the court found the parties had agreed the client would pay the attorney for his services. Overboe v. Brodshaug, 2008 ND 112, 751 N.W.2d 177, 2008 N.D. LEXIS 108 (N.D. 2008).
District court erred by awarding the special prosecutor 6% per annum interest instead of the 1.5% monthly interest rate stated on the bill because N.D.C.C. ch. 47-14 applied to loans of money and there was no loan for money. Traynor Law Firm v. State, 2020 ND 108, 943 N.W.2d 320, 2020 N.D. LEXIS 107 (N.D. 2020).
Accounting Methods.
Where seller of tractor sued buyer to recover purchase price and cost of certain repairs, seller was entitled to interest at the statutory rate from time the debt arose until entry of judgment, and court used seller’s accounting methods to determine the amount due. Hoffman Motors v. Enockson, 240 N.W.2d 353, 1976 N.D. LEXIS 203 (N.D. 1976).
Contract Enforced for Statutory Rate.
A parol contract to pay interest in excess of the legal rate is enforceable as to the legal rate only. First Nat'l Bank v. Messner, 35 N.D. 78, 159 N.W. 92, 1916 N.D. LEXIS 140 (N.D. 1916).
Court’s Discretion.
The court in a divorce action is not limited to awarding interest at the legal rate specified in this section, but may award interest at any appropriate rate, commencing on any appropriate date, or may deny interest altogether. Dick v. Dick, 434 N.W.2d 557, 1989 N.D. LEXIS 16 (N.D. 1989).
Interest After Maturity.
A contract for the payment of interest in a note and mortgage executed subsequent to the statute was void to the extent that the interest after maturity exceeded the amount contracted for prior to maturity. LUTZ v. COFFEY, 61 N.D. 431, 238 N.W. 29, 1931 N.D. LEXIS 292 (N.D. 1931).
The provision requiring that contracts bear the same rate of interest after maturity as they bear before has no application to a note that is payable without interest before maturity. Allen v. Miller, 84 N.W.2d 571, 1957 N.D. LEXIS 133 (N.D. 1957).
Interest before maturity is compensation for use of money and is regulated by N.D.C.C. § 47-14-09 while interest allowed after maturity is compensation for damages for wrongful detention of money and is regulated by this section; provision in contract for higher interest rate after maturity than before, regardless of rate, is void as to such increase but will have no other effect on contract; note providing for higher than lawful rate of interest after maturity was not usurious since N.D.C.C. § 47-14-09 has application only to rate of interest chargeable before maturity. Oil Invs. v. Dallea Petroleum Corp., 152 N.W.2d 415, 1967 N.D. LEXIS 129 (N.D. 1967).
Interest As Compensatory Damages.
Where interest awarded was an element of compensatory damages, the statutory prejudgment-interest limitation was not applicable. Hart Honey Co. v. Cudworth, 446 N.W.2d 742, 1989 N.D. LEXIS 185 (N.D. 1989).
Interest landlord charged tenant after breach of the lease was compensation for damages for the wrongful detention of money and not interest charged before maturity or for the use of money, and thus was not subject to N.D.C.C. § 47-14-09. T.F. James Co. v. Vakoch, 2000 ND 9, 604 N.W.2d 459, 2000 N.D. LEXIS 9 (N.D. 2000).
Limit on Finance Charge.
Where there is no evidence of a retail installment contract, a revolving charge account agreement, or any other contract in writing about interest or finance charges and unless N.D.C.C. § 13-01-14 applies, there is no legal or contractual basis for a one and one-half percent per month finance charge, and seller would be limited to the presumed rate of interest of six percent per annum under this section. Royal Jewelers v. Kopp, 365 N.W.2d 525, 1985 N.D. LEXIS 277 (N.D. 1985).
Merchants.
A buyer’s assertion that there was no written agreement to pay interest because he did not sign any of the invoices specifying an interest charge was without merit between merchants, where the buyer did not object to the invoices. Northwestern Equip. v. Badinger, 403 N.W.2d 8, 1987 N.D. LEXIS 273 (N.D. 1987).
Monetary Awards in Divorce Actions.
It was not error to apply a two percent interest rate to a wife's equalization payment from a husband, rather than the 6.5 percent rate in N.D.C.C. § 28-20-34 or the six percent rate in N.D.C.C. § 47-14-05, because (1) no party presented evidence as to the proper rate, and (2) the court explained the reasons for setting the rate at two percent, which was within the range of rates argued by the parties. Adams v. Adams, 2015 ND 112, 863 N.W.2d 232, 2015 N.D. LEXIS 112 (N.D. 2015).
District court did not abuse its discretion in awarding interest on the husband's delayed cash payments to the wife because it compromised between the parties' interest rate proposals and required the husband to pay interest on the remaining cash award. Rebel v. Rebel, 2016 ND 144, 882 N.W.2d 256, 2016 N.D. LEXIS 145 (N.D. 2016).
Prejudgment Interest.
In the absence of a specific contractual rate of interest, prejudgment interest must be calculated at the prescribed legal rate of interest in legal and equitable actions. Hirschkorn v. Severson, 319 N.W.2d 475, 1982 N.D. LEXIS 282 (N.D. 1982).
Prejudgment interest is calculated at rate provided by this section; after judgment, interest is calculated at rate provided by N.D.C.C. § 28-20-34. Bismarck Realty Co. v. Folden, 354 N.W.2d 636, 1984 N.D. LEXIS 324 (N.D. 1984).
Prejudgment interest at six per cent per annum on partner’s share of accumulated profits following dissolution of the partnership was upheld. Tarnavsky v. Tarnavsky, 147 F.3d 674, 1998 U.S. App. LEXIS 12129 (8th Cir. N.D. 1998).
Prejudgment interest on unpaid management fees was to be calculated at the rate of 6 percent where the relevant agreement did not specify an interest rate. Red River Wings, Inc. v. Hoot, Inc., 2008 ND 117, 751 N.W.2d 206, 2008 N.D. LEXIS 118 (N.D. 2008).
Hospital, as a “medical services provider,” who did not make disclosures to the consumer required under N.D.C.C. § 13-01-15 to charge the “late payment charge” allowed under N.D.C.C. § 13-01-14.1, was still entitled to prejudgment interest under N.D.C.C. § 47-14-05 at the legal rate of six percent per annum. Weeks v. Geiermann, 2012 ND 63, 814 N.W.2d 792, 2012 N.D. LEXIS 62 (N.D. 2012).
Property Settlement in Divorce Proceeding.
This section is not a limitation upon the trial court’s authority to make an equitable distribution of property in a divorce case; trial court had authority to order party to a divorce proceeding to pay interest at a rate greater than the legal rate established by this section in equal amortized payments on the unpaid balance of the sum the other party was to receive as her part of the couple’s property to be distributed upon the divorce. Klitzke v. Klitzke, 308 N.W.2d 385, 1981 N.D. LEXIS 335 (N.D. 1981).
Suretyship Liability.
The surety on a bond is liable for interest at the legal rate from the time of the demand made upon him. Stutsman County v. Dakota Trust Co., 47 N.D. 228, 181 N.W. 586 (1921), following Guilford School Dist. v. Dakota Trust Co., 47 N.D. 235, 181 N.W. 589, 1921 N.D. LEXIS 92 (N.D. 1921).
Collateral References.
Usury: provision for interest after maturity at a rate in excess of legal rate as usurious or otherwise illegal, 28 A.L.R.3d 449.
Revolving charge account contract or plan, validity and construction of, 41 A.L.R.3d 682.
Late charge: validity and construction of provision imposing “late charge” or similar exaction for delay in making periodic payments on note, mortgage or installment sale contract, 63 A.L.R.3d 50.
Law Reviews.
Recent Developments in North Dakota Contract Law, 60 N.D. L. Rev. 227 (1984).
North Dakota Supreme Court Review, (Red River Wings, Inc. v. Hoot, Inc., 2008 ND 117, 751 N.W.2d 206 (2008)), see 85 N. Dak. L. Rev. 503 (2009).
47-14-06. Annual rate when not specified.
When a rate of interest is prescribed by a law or contract without specifying the period of time by which such rate is to be calculated, it shall be deemed an annual rate.
Source:
Civ. C. 1877, § 1096; R.C. 1895, § 4062; R.C. 1899, § 4062; R.C. 1905, § 5509; C.L. 1913, § 6071; R.C. 1943, § 47-1406.
Derivation:
Cal. Civ. C., 1916.
47-14-07. Interest rate — Before and after breach.
Any legal rate of interest stipulated by a contract remains chargeable after a breach until the contract is superseded by a verdict or other new obligation.
Source:
Civ. C. 1877, § 1102; R.C. 1895, § 4068; R.C. 1899, § 4068; R.C. 1905, § 5515; C.L. 1913, § 6078; R.C. 1943, § 47-1407; S.L. 2013, ch. 347, § 2.
Effective Date.
The 2013 amendment of this section by section 2 of chapter 347, S.L. 2013 became effective August 1, 2013.
Notes to Decisions
In General.
Interest is proper for breach of contract. Troutman v. Pierce, Inc., 402 N.W.2d 920, 1987 N.D. LEXIS 270 (N.D. 1987).
Application of Section.
In the absence of a provision to the contrary, a note bears the same interest rate after maturity as before maturity. Colonial & United States Mtg. Co. v. Flemington, 14 N.D. 181, 103 N.W. 929, 116 Am. St. Rep. 670, decided prior to the enactment of Chapter 5, p. 9, of the 1905 Laws.
This section has no application to a promissory note that is payable without interest. Allen v. Miller, 84 N.W.2d 571, 1957 N.D. LEXIS 133 (N.D. 1957).
47-14-08. Interest on loans may be deducted in advance — Limitation.
The interest which would become due at the end of the term for which a loan is made, not exceeding one year’s interest in all, may be deducted from the loan in advance if the parties thus agree.
Source:
Civ. C. 1877, § 1099; R.C. 1895, § 4065; R.C. 1899, § 4065; R.C. 1905, § 5512; C.L. 1913, § 6075; R.C. 1943, § 47-1408.
Collateral References.
Usury, taking or charging interest in advance as, 57 A.L.R.2d 630, 663.
47-14-09. Usury — Definition — Maximum contract rate — Prohibition — Exclusions.
- Except as otherwise provided by the laws of this state, a person, either directly or indirectly, may not take or receive, or agree to take or receive, in money, goods, or things in action, or in any other way, any greater sum or greater value for the loan or forbearance of money, goods, or things in action than five and one-half percent per annum higher than the current cost of money as reflected by the average rate of interest payable on United States treasury bills maturing in six months in effect for North Dakota for the six months immediately preceding the month in which the transaction occurs, as computed and declared on the last day of each month by the state banking commissioner, but that in any event the maximum allowable interest rate ceiling may not be less than seven percent, and in the computation of interest the same may not be compounded; provided, however, that a minimum interest charge of fifteen dollars may be made. A contract may not provide for the payment of interest on interest overdue, but this section does not apply to a contract to pay interest at a lawful rate on interest that is overdue at the time such contract is made. Any violation of this section is deemed usury.
-
This section does not apply to a:
- Bona fide pawnbroking transaction in an amount not exceeding ten thousand dollars which is made by a bona fide pawnbroking business transacted under a pawnbroker’s license;
- Loan made to a foreign or domestic corporation, foreign or domestic limited liability company, cooperative corporation or association, or trust;
- Loan made to a partnership, limited partnership, or association that files a state or federal partnership income tax return;
- Loan or forbearance of money, goods, or things in action the principal amount of which amounts to more than thirty-five thousand dollars; and
- Loan made by a lending institution which is regulated or funded by an agency of a state or of the federal government.
- Notwithstanding the interest rate limit set under this section, state-chartered banks and the Bank of North Dakota may charge interest at a rate equal to the maximum allowable rate which lawfully may be charged for a particular type of loan by national banking associations or state or federally chartered savings and loan associations operating out of facilities located in this state.
- As used in this section, “bona fide pawnbroking transaction” means a transaction with a licensed pawnbroker which includes both possession and a pledge of tangible personal property.
Source:
S.L. 1890, ch. 184, § 2; 1893, ch. 131, § 2; R.C. 1895, § 4064; R.C. 1899, § 4064; R.C. 1905, § 5511; C.L. 1913, § 6073; S.L. 1915, ch. 176, § 2; 1925, ch. 155, § 2; 1925 Supp., § 6073; S.L. 1927, ch. 274, § 1; 1933, ch. 140, § 1; 1935, ch. 159, § 1; R.C. 1943, § 47-1409; S.L. 1969, ch. 404, § 1; 1975, ch. 71, § 2; 1979, ch. 485, § 1; 1981, ch. 463, § 2; 1993, ch. 54, § 106; 2001, ch. 406, § 1; 2013, ch. 348, § 1.
Effective Date.
The 2013 amendment of this section by section 1 of chapter 348, S.L. 2013 became effective August 1, 2013.
Cross-References.
Consumer Finance Act, maximum charges permitted, see N.D.C.C. § 13-03.1-15.
Interest rate chargeable by banks, see N.D.C.C. § 6-03-62.
Interest rate chargeable by building and loan association, see N.D.C.C. § 7-02-04.
Wholesaler’s or manufacturer’s service charge on overdue account, see N.D.C.C. § 51-07-14.
Notes to Decisions
- Class Action Maintainable.
- Compensation for the Use of Money.
- Compounded Interest.
- Effect of Change in Legal Rate.
- Fair Debt Collection Practices Act Claim.
- Installment Sales Contract.
- Interest After Maturity.
- Interest As Compensatory Damages.
- Interest on Mortgage.
- Usurious Small Loan Business.
- Service Charge.
Class Action Maintainable.
Farmer was entitled to maintain class action on allegations that grain elevators were charging usurious interest on advances to farmers where the same accounting procedure for billing interest was applied to all farmers; fact that some farmers may have signed notes while others did not, that there might be individual differences as to dates of advances and repayments and amount of damages and that there was only one party plaintiff and no other persons had sought to intervene did not preclude class action. Rogelstad v. Farmers Union Grain Terminal Ass'n, 226 N.W.2d 370, 1975 N.D. LEXIS 202 (N.D. 1975).
Compensation for the Use of Money.
Attorney was charging the client “service charges” on her bill before the bill was due in June 1998, when the attorney quit representing the client, which constituted compensation for the use of money, not compensation for damages for the wrongful detention of money, and triggered application of the usury statutes; the attorney charged the client an interest rate higher than that permitted by N.D.C.C. § 47-14-09 before he completed his representation of her in June 1998, which was the date the court found the parties had agreed the client would pay the attorney for his services. Overboe v. Brodshaug, 2008 ND 112, 751 N.W.2d 177, 2008 N.D. LEXIS 108 (N.D. 2008).
Compounded Interest.
This section clearly prohibits the compounding of interest on an applicable transaction; therefore, compounded interest was unenforceable and could not be collected by an action in the courts. Haider v. Montgomery, 423 N.W.2d 494, 1988 N.D. LEXIS 126 (N.D. 1988).
Effect of Change in Legal Rate.
Legislation reducing the lawful rate of interest, enacted subsequent to the execution of a note providing for interest at a rate then valid, did not taint the note with usury. Messersmith v. Reilly, 70 N.D. 638, 296 N.W. 920, 1941 N.D. LEXIS 209 (N.D. 1941).
Where the interest provision in a promissory note was lawful at the time the note was executed, the note was not rendered usurious by the execution of a subsequent contract to pay interest in excess of the lawful rate as consideration for extension of the time for payment of the original note. Messersmith v. Reilly, 70 N.D. 638, 296 N.W. 920, 1941 N.D. LEXIS 209 (N.D. 1941).
Where an original transaction is not tainted with usury in its inception, the fact that subsequent transactions with reference to the same matter may be usurious does not render the first transaction usurious. Messersmith v. Reilly, 70 N.D. 638, 296 N.W. 920, 1941 N.D. LEXIS 209 (N.D. 1941).
Fair Debt Collection Practices Act Claim.
Appellate court agreed with the district court that the corporation was entitled to summary judgment dismissing the Federal Fair Debt Collection Practices Act claim based upon violation of N.D.C.C. § 47-14-09(1), for charging interest on overdue interest because the corporation’s interest-on-interest violation was unintentional and was caused by a bona fide error of a clerical or data entry nature under 15 U.S.C.S. § 1692k(c), and a reasonable jury could have only concluded that the corporation’s procedures were reasonably adapted to avoid such errors. Wilhelm v. Credico, Inc., 519 F.3d 416, 2008 U.S. App. LEXIS 4479 (8th Cir. N.D. 2008).
Installment Sales Contract.
An installment sales contract for the sale and purchase of a farm combine was a “retail installment contract” within provisions of N.D.C.C. ch. 51-13, and therefore fell within the exception clause of this section, rendering its provisions inapplicable to the transaction. Mandan Supply v. Steckler, 244 N.W.2d 698, 1976 N.D. LEXIS 126 (N.D. 1976).
Interest After Maturity.
Interest before maturity is compensation for use of money and is regulated by this section while interest allowed after maturity is compensation for damages for wrongful detention of money and is regulated by N.D.C.C. § 47-14-05; provision in contract for higher interest rate after maturity than before, regardless of rate, is void as to such increase but will have no other effect on contract; note providing for higher than lawful rate of interest after maturity was not usurious since this section applies only to rate of interest chargeable before maturity. Oil Invs. v. Dallea Petroleum Corp., 152 N.W.2d 415, 1967 N.D. LEXIS 129 (N.D. 1967).
Interest As Compensatory Damages.
Interest landlord charged tenant after breach of the lease was compensation for damages for the wrongful detention of money and not interest charged before maturity or for the use of money, and thus was not in violation of this section. T.F. James Co. v. Vakoch, 2000 ND 9, 604 N.W.2d 459, 2000 N.D. LEXIS 9 (N.D. 2000).
Interest on Mortgage.
A mortgage given for interest partly in excess of the highest contract rate per annum is not void in this state. Grove v. Great N. Loan Co., 17 N.D. 352, 116 N.W. 345, 1908 N.D. LEXIS 57 (N.D. 1908).
Usurious Small Loan Business.
A usurious small loan business is a nuisance and may be enjoined at the instance of the state, even though the offender is amenable to the criminal law of the state. State ex rel. Burgum v. Hooker, 87 N.W.2d 337, 1957 N.D. LEXIS 182 (N.D. 1957).
Service Charge.
Where there was no evidence in the record to show that the plaintiff was a manufacturer or wholesaler entitled to the service charge authorized by N.D.C.C. § 51-07-14, the plaintiff had not shown that it was entitled to charge interest on interest. Northwestern Equip. v. Badinger, 403 N.W.2d 8, 1987 N.D. LEXIS 273 (N.D. 1987).
DECISIONS UNDER PRIOR LAW
Interest upon Interest.
Interest upon interest was not usury. Hovey v. Edmison, 22 N.W. 594, 3 Dakota 449, 1884 Dakota LEXIS 14 (Dakota 1884).
Price-Fixing.
The amended usury statute was not a price-fixing statute. Sayler v. Brady, 63 N.D. 471, 248 N.W. 673, 1933 N.D. LEXIS 200 (N.D. 1933).
Overdue Interest.
Statute providing that any contract to pay interest on interest overdue should be deemed usury did not render usurious a contract to pay interest at a lawful rate on interest overdue at the time the contract was made. Security Credit Co. v. Wieble, 67 N.D. 407, 272 N.W. 750, 1937 N.D. LEXIS 93 (N.D. 1937).
Collateral References.
Attorney fees and collection costs: usurious nature of provision in promissory note or other evidence of indebtedness for payment, as attorneys’ fees, expenses and costs of collection, of specified percentage of note, 17 A.L.R.2d 288, 295.
Computing interest on basis of three hundred sixty days in year, thirty days in month, or the like, as usury, 35 A.L.R.2d 842.
Commissions: expenses or charge in form of commissions to agents, brokers, or like intermediaries incident to loan of money, 52 A.L.R.2d 703.
Delay in delivering principal to borrower, usury as affected by, 57 A.L.R.2d 630, 663.
Prepayment: usury as affected by repayment of, or borrower’s option to repay, loan before maturity, 75 A.L.R.2d 1265.
Independent contract: payments under ostensibly independent contract as usury, 81 A.L.R.2d 1280.
Insurance: requiring borrower to pay for insurance as condition of loan, 91 A.L.R.2d 1344.
Expense or trouble of procuring money loaned, charging borrower for or with, 91 A.L.R.2d 1389.
Mistake in amount or calculation of interest or service charges for loan, usury as affected by, 11 A.L.R.3d 1498.
Advance in price for credit sale as compared with cash sale as usury, 14 A.L.R.3d 1065.
Share in earnings: agreement for share in earnings of or income from property in lieu of, or in addition to, interest as usurious, 16 A.L.R.3d 475.
Other debt: effect of borrower’s agreement to pay, guarantee or secure some other debt owed to or by lender, 31 A.L.R.3d 763.
Revolving charge account contract or plan, validity and construction of, 41 A.L.R.3d 682.
Escalator clause: validity and construction of provision (escalator clause) in land contract or mortgage that rate of interest payable shall increase if legal rate is raised, 60 A.L.R.3d 473.
Late charge: validity and construction of provision imposing “late charge” or similar exaction for delay in making periodic payments on note, mortgage or installment sale contract, 63 A.L.R.3d 50.
Acceleration clause, usury as affected by, 66 A.L.R.3d 650.
Validity of statutes, ordinances, and regulations governing pawn shops, 16 A.L.R.6th 219.
State Regulation of Payday Loans, 29 A.L.R.6th 461.
47-14-10. Civil liability for usury — Forfeiture of interest.
The taking, receiving, reserving, or charging of a rate of interest greater than is allowed by the laws of this state relative to usury shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it or which has been agreed to be paid thereon, and in addition thereto, a forfeiture of twenty-five percent of the principal thereof. In case the greater rate of interest has been paid, the person by whom it has been paid, or that person’s legal representative may:
- Recover back twice the amount of interest thus paid, together with twenty-five percent of the principal from the person taking or receiving the same, but an action must be commenced for such purpose within four years after the time when the usurious transaction occurred; or
- Offset twice the amount of such interest against any indebtedness which the person who paid the same owes to the party or parties receiving such usurious interest.
Source:
Civ. C. 1877, § 1100; S.L. 1887, ch. 207, § 1; 1893, ch. 131, § 3; R.C. 1895, § 4066; R.C. 1899, § 4066; R.C. 1905, § 5513; S.L. 1911, ch. 311, § 2; C.L. 1913, § 6076; S.L. 1919, ch. 235, § 1; 1925 Supp., § 6076; S.L. 1941, ch. 146, § 1; R.C. 1943, § 47-1410.
Notes to Decisions
- Action Under Federal Statute.
- Collection of Separate Claim.
- Computation of Double Interest.
- Contract Not Void.
- Maximum Rate.
- Payment of Interest.
- Power of Court.
Action Under Federal Statute.
The right given by federal statute to recover double the interest paid to a national bank, when the interest so paid is greater than that allowed by the laws of the state, is personal to the party paying the usurious interest, and an action to recover the same can be maintained only by such person or his legal representative. Lealos v. Union Nat'l Bank, 9 N.D. 60, 81 N.W. 56, 1899 N.D. LEXIS 138 (N.D. 1899).
Collection of Separate Claim.
The collection of another and distinct claim at the time of extending a mortgage, and demand for payment of such as condition subsequent to extending the mortgage, does not constitute usury. Miller v. Bank of Harvey, 22 N.D. 538, 134 N.W. 745, 1912 N.D. LEXIS 44 (N.D. 1912).
Computation of Double Interest.
In prescribing the amount recoverable when usurious payments have been made, plaintiff may recover double the amount of all interest payments made, and not merely the excess over the lawful rate. Waldner v. Bowdon State Bank, 13 N.D. 604, 102 N.W. 169, 1904 N.D. LEXIS 85 (N.D. 1904).
Contract Not Void.
The sale of land in mortgage foreclosure proceedings cannot be set aside because the contract was usurious. Robinson v. McKinney, 29 N.W. 658, 4 Dakota 290, 1886 Dakota LEXIS 10 (Dakota 1886).
Maximum Rate.
Where the interest rate charged under a promissory note did not exceed the maximum rate allowable, the forfeiture remedy under this section did not apply. Haider v. Montgomery, 423 N.W.2d 494, 1988 N.D. LEXIS 126 (N.D. 1988).
Payment of Interest.
In order to recover the penalty the statute contemplates an actual payment, and interest is not paid, within the meaning of the statute, by the giving of a renewal note or notes. Lindberg v. Burton, 41 N.D. 587, 171 N.W. 616, 1918 N.D. LEXIS 169 (N.D. 1918).
Although the client did not make any usurious payments to the attorney, charging a rate greater than allowed by the usury statutes triggered the usury sanctions under the first prong of N.D.C.C. § 47-14-10. Overboe v. Brodshaug, 2008 ND 112, 751 N.W.2d 177, 2008 N.D. LEXIS 108 (N.D. 2008).
Power of Court.
The parties to a usurious contract may purge it of usury by agreement, but a court of law or equity cannot do so after suit is brought and a defense of usury is interposed. Person v. Mattson, 33 N.D. 49, 156 N.W. 780, 1916 N.D. LEXIS 72 (N.D. 1916).
DECISIONS UNDER PRIOR LAW
Counterclaim.
A counterclaim could not be maintained, in action for the principal, to recover the interest agreed to be paid. Wood v. Cuthbertson, 21 N.W. 3, 3 Dakota 328, 1884 Dakota LEXIS 11 (Dakota 1884).
Usurious Note.
No action could be maintained against the original owner of a usurious promissory note, by the maker, to recover the amount thereof unless such original owner transferred or parted with such note before maturity, without giving the purchaser notice of its usurious character. Hanson v. Cummings State Bank, 6 N.D. 212, 69 N.W. 202, 1896 N.D. LEXIS 24 (N.D. 1896).
Collateral References.
Limitations: what statute of limitations governs action or claim for affirmative relief against usurious obligation or to recover usurious payment, 48 A.L.R.2d 401.
Evidence: quantum, degree or weight of evidence to sustain usury charge, 51 A.L.R.2d 1087.
Right, in absence of statute expressly so providing, to recover back usurious payments, 59 A.L.R.2d 522.
Evidence of other assertedly usurious transactions, admissibility in civil case involving usury issue, 67 A.L.R.2d 232.
Cumulative statutory penalties for usury transactions, recovery of, 71 A.L.R.2d 986, 1011.
Liability for the statutory penalty of persons other than the offending lender in a usurious loan transaction, 4 A.L.R.3d 650.
Borrower’s initiation of, or fraud contributing to, usurious transaction as affecting rights or remedies of the parties, 16 A.L.R.3d 510.
Reformation of usurious contract, 74 A.L.R.3d 1239.
47-14-11. Criminal penalty for usury.
Any person who shall take, receive, reserve, or charge a usurious rate of interest, in addition to being liable for the penalties and forfeitures specified in section 47-14-10, shall be guilty of a class B misdemeanor.
Source:
Civ. C. 1877, § 1100; S.L. 1887, ch. 207, § 1; 1893, ch. 131, § 3; R.C. 1895, § 4066; R.C. 1899, § 4066; R.C. 1905, § 5513; S.L. 1911, ch. 311, § 2; C.L. 1913, § 6076; S.L. 1919, ch. 235, § 1; 1925 Supp., § 6076; S.L. 1941, ch. 146, § 1; R.C. 1943, § 47-1411; S.L. 1975, ch. 106, § 519.
CHAPTER 47-15 Hiring of Personal Property
47-15-01. Hiring defined.
Hiring is a contract by which one gives to another the temporary possession and use of personal property, other than goods subject to chapter 41-02.1 or money, for reward, and the latter agrees to return the same to the former at a future time.
Source:
Civ. C. 1877, § 1103; R.C. 1895, § 4069; R.C. 1899, § 4069; R.C. 1905, § 5516; C.L. 1913, § 6079; R.C. 1943, § 47-1501; S.L. 1991, ch. 448, § 21.
Derivation:
Cal. Civ. C., 1925.
47-15-02. Obligations of letter.
One who lets personal property must:
- Deliver it to the hirer;
- Secure the hirer’s quiet enjoyment thereof against all lawful claimants;
- Put it into a condition fit for the purpose for which the letter lets it; and
- Repair all deteriorations thereof not occasioned by the fault of the hirer and not the natural result of its use.
Source:
Civ. C. 1877, § 1123; R.C. 1895, § 4089; R.C. 1899, § 4089; R.C. 1905, § 5537; C.L. 1913, § 6100; R.C. 1943, § 47-1502.
Derivation:
Cal. Civ. C., 1955.
Collateral References.
Automotive vehicle or machine, liability of bailor for personal injury or death due to defects in, 46 A.L.R.2d 404.
Products liability: application of strict liability in tort doctrine to lessor of personal property, 52 A.L.R.3d 121.
Liability of owner or bailor of horse for injury by horse to hirer or bailee, 6 A.L.R.4th 358.
47-15-03. Remedy against letter.
If a letter fails to fulfill the letter’s obligations as prescribed by section 47-15-02, the hirer, after giving the letter notice to do so, if such notice may be given conveniently, may expend any reasonable amount necessary to make good the letter’s default and may recover such amount from the letter.
Source:
Civ. C. 1877, § 1125; R.C. 1895, § 4091; R.C. 1899, § 4091; R.C. 1905, § 5539; C.L. 1913, § 6102; R.C. 1943, § 47-1503.
Derivation:
Cal. Civ. C., 1957.
47-15-04. Ordinary care.
The hirer of personal property must use ordinary care for its preservation in safety and in good condition.
Source:
Civ. C. 1877, § 1106; R.C. 1895, § 4072; R.C. 1899, § 4072; R.C. 1905, § 5519; C.L. 1913, § 6082; R.C. 1943, § 47-1504.
Derivation:
Cal. Civ. C., 1928.
Collateral References.
Theft: tort liability of bailee for theft by servant, 15 A.L.R.2d 829, 846.
Automobile: liability of bailee for hire of automobile for loss of, or damage to, contents, 27 A.L.R.2d 796.
Liability of owner or operator of motorboat for injury or damage, 63 A.L.R.2d 343.
Insurance: fire policy on contents or the like as covering property of insured’s customers or bailors, 67 A.L.R.2d 1241.
Insurance: bailee’s duty to insure bailed property, 28 A.L.R.3d 513.
Motor vehicle leasing contracts, construction and effect of, 43 A.L.R.3d 1283.
Airplane: liability of bailee of airplane for damage thereto, 44 A.L.R.3d 862.
Insurance: bailor’s right of direct action against bailee’s theft insurer for loss of bailed property, 64 A.L.R.3d 1207.
Fairs: validity and construction of contract exempting agricultural fair or similar bailee from liability for articles delivered for exhibition, 69 A.L.R.3d 1025.
Liability of bank or safe-deposit company for its employee’s theft or misappropriation of content of safe-deposit box, 39 A.L.R.4th 543.
47-15-05. Limitation of use to purpose for which let.
When personal property is let for a particular purpose, the hirer must not use it for any other purpose. If the hirer uses it for a purpose other than that for which it was let, the letter may hold the hirer responsible for its safety during such use in all events, or may treat the contract as thereby rescinded.
Source:
Civ. C. 1877, § 1108; R.C. 1895, § 4074; R.C. 1899, § 4074; R.C. 1905, § 5521; C.L. 1913, § 6084; R.C. 1943, § 47-1505.
Derivation:
Cal. Civ. C., 1930.
47-15-06. Title to products.
The products of personal property hired, during the hiring, belong to the hirer.
Source:
Civ. C. 1877, § 1104; R.C. 1895, § 4070; R.C. 1899, § 4070; R.C. 1905, § 5517; C.L. 1913, § 6080; R.C. 1943, § 47-1506.
Derivation:
Cal. Civ. C., 1926.
47-15-07. Injuries — Reparation by hirer.
The hirer of personal property must repair all deteriorations or injuries thereto occasioned by the hirer’s ordinary or gross negligence.
Source:
Civ. C. 1877, § 1107; R.C. 1895, § 4073; R.C. 1899, § 4073; R.C. 1905, § 5520; C.L. 1913, § 6083; R.C. 1943, § 47-1507.
Derivation:
Cal. Civ. C., 1929.
Notes to Decisions
In General.
The hirer of personal property must repair all deteriorations or injuries thereto occasioned by his ordinary or gross negligence. Tweeten v. Miller, 477 N.W.2d 822, 1991 N.D. LEXIS 212 (N.D. 1991).
47-15-08. Expenses borne by hirer.
A hirer of personal property must bear all such expenses concerning it as naturally might be foreseen to attend it during its use by the hirer. All other expenses must be borne by the letter.
Source:
Civ. C. 1877, § 1124; R.C. 1895, § 4090; R.C. 1899, § 4090; R.C. 1905, § 5538; C.L. 1913, § 6101; R.C. 1943, § 47-1508.
Derivation:
Cal. Civ. C., 1956.
47-15-09. Termination of hiring in general.
The hiring of personal property terminates:
- At the end of the term agreed upon;
- By the mutual consent of the parties;
- By the hirer’s acquiring a title to the property hired superior to that of the letter;
- By the destruction of the property hired; or
- If the hiring is terminable at the pleasure of one of the parties thereto, by notice to the other of the party’s death or incapacity to contract, but in no other case is it terminable thereby.
Source:
Civ. C. 1877, §§ 1111, 1112; R.C. 1895, §§ 4077, 4078; R.C. 1899, §§ 4077, 4078; R.C. 1905, §§ 5524, 5525; C.L. 1913, §§ 6087, 6088; R.C. 1943, § 47-1509.
Derivation:
Cal. Civ. C., 1933, 1934.
47-15-10. Termination before end of term by letter.
The letter of personal property may terminate the hiring and reclaim the property before the end of the term agreed upon when the:
- Hirer uses or permits a use of the property hired in a manner contrary to the agreement of the parties; or
- Hirer does not make, within a reasonable time after request, such repairs as the hirer is bound to make.
Source:
Civ. C. 1877, § 1109; R.C. 1895, § 4075; R.C. 1899, § 4075; R.C. 1905, § 5522; C.L. 1913, § 6085; R.C. 1943, § 47-1510.
Derivation:
Cal. Civ. C., 1931.
47-15-11. Termination before end of term by hirer.
The hirer of personal property may terminate the hiring before the end of the term agreed upon:
- When the letter, within a reasonable time after request, does not fulfill the letter’s obligations, if any, as to placing and securing the hirer in the quiet possession of the thing hired, or putting it into a good condition, or repairing it; or
- When the greater part of the property hired, or that part thereof which was, and which the letter at the time of the hiring had reason to believe was, the material inducement to the hirer to enter into the contract, perishes from any cause other than the ordinary or gross negligence of the hirer.
Source:
Civ. C. 1877, § 1110; R.C. 1895, § 4076; R.C. 1899, § 4076; R.C. 1905, § 5523; C.L. 1913, § 6086; R.C. 1943, § 47-1511.
Derivation:
Cal. Civ. C., 1932.
Notes to Decisions
Landlord and Tenant.
A landlord who agrees to furnish heat for the proper heating of the building leased and fails to keep his contract, after having been given notice of the defect and allowed a reasonable time in which to remedy it, commits acts which in law will be regarded a constructive eviction of the tenant from the premises. Russell v. Olson, 22 N.D. 410, 133 N.W. 1030, 1911 N.D. LEXIS 60 (N.D. 1911).
47-15-12. Payment of proportionate hire.
When the hiring of personal property is terminated before the time originally agreed upon, the hirer must pay the due proportion of the hire for such use as the hirer actually has made of the property unless such use is merely nominal and of no benefit to the hirer.
Source:
Civ. C. 1877, § 1113; R.C. 1895, § 4079; R.C. 1899, § 4079; R.C. 1905, § 5526; C.L. 1913, § 6089; R.C. 1943, § 47-1512.
Derivation:
Cal. Civ. C., 1935.
47-15-13. Return of property by hirer.
At the expiration of the term for which personal property is hired, the hirer must return it to the letter at the place contemplated by the parties at the time of hiring, or if no particular place was contemplated by them, at the place at which it was at the time of hiring.
Source:
Civ. C. 1877, § 1126; R.C. 1895, § 4092; R.C. 1899, § 4092; R.C. 1905, § 5540; C.L. 1913, § 6103; R.C. 1943, § 47-1513.
Derivation:
Cal. Civ. C., 1958.
CHAPTER 47-15.1 Consumer Rental Purchase Agreement
47-15.1-01. Definitions.
As used in this chapter, unless the context or subject matter otherwise requires:
- “Advertisement” means a commercial message in any medium that aids, promotes, or assists a consumer rental purchase agreement.
- “Cash price” means the price at which the lessor would have sold the property to the consumer for cash on the date of the consumer rental purchase agreement for the property.
- “Consumer” means an individual who rents property under a consumer rental purchase agreement.
-
“Consumer rental purchase agreement” includes an agreement for the use of property by a consumer primarily for personal, family, or household purposes for an initial period of four months or less, regardless of whether there is any obligation beyond the initial period; which is automatically renewable with each payment after the initial period but does not obligate or require the consumer to continue renting or using the property beyond the initial period, and which permits the consumer to become the owner of the property under the terms of the consumer rental purchase agreement. The term does not include:
- A rental purchase agreement primarily for business, commercial, or agricultural purposes, or an agreement with a governmental agency or instrumentality or organizations.
- A lease or agreement that constitutes an installment sale or installment contract as defined in section 51-13-01.
- A lease of a safe deposit box.
- A lease or a bailment of personal property incidental to the lease of real property and which contains no provision for the consumer to have an option to purchase the leased property.
- A lease of a motor vehicle.
- A hiring defined under chapter 47-15.
- A security interest under chapter 41-09.
- “Consummation” means the time at which a consumer becomes contractually obligated on a consumer rental purchase agreement.
- “Lessor” includes a person who regularly provides the use of property through consumer rental purchase agreements and to whom rental payments are initially payable on the face of a consumer rental purchase agreement.
Source:
S.L. 1993, ch. 450, § 1.
47-15.1-02. Inapplicability of other laws.
Consumer rental purchase agreements under this chapter are not governed by the laws relating to a retail installment contract or a retail installment sale as defined in section 51-13-01 or security interest as defined in section 41-01-09.
Source:
S.L. 1993, ch. 450, § 2; 2007, ch. 354, § 28.
47-15.1-03. Disclosure of information.
-
A lessor shall include in a consumer rental purchase agreement:
- The total number, total amount, and timing of all payments necessary to acquire ownership of the property.
- A statement that the consumer does not own the property until the consumer has made the total payments necessary to acquire ownership.
- A statement that the consumer is responsible for the fair market value of the property at the time it is lost, stolen, damaged, or destroyed, if that is the intent of the lessor.
- A description of the leased property sufficient to identify the property to the consumer and the lessor, including any identification numbers, if applicable, in a statement indicating whether the property is new or used. A statement indicating that the property is used when in fact it is new is not a violation of this chapter.
- A statement of the cash price of the property. If the agreement includes a lease of two or more items as a set, in one agreement, a statement of the aggregate cash price of all the items is sufficient.
- The total of initial payments paid or required to be paid at or before consummation of the agreement or delivery of the property, whichever is later.
- A statement that the total amount of a payment does not include other charges such as late payment penalties; default, pickup, or reinstatement fees; and other fees which must be separately disclosed in the contract.
- A statement clearly summarizing the terms of the consumer’s option to purchase, including a statement that the consumer has the right to exercise any early purchase options and the price or formula or method for determining the price at which the property may be purchased at any given time.
- A statement identifying the party responsible for maintaining or servicing the property while the property is being leased, together with a description of that responsibility, and a statement that if any part of the manufacturer’s express warranty covers the leased property at the time the consumer acquires ownership of the property, the warranty is transferred to the consumer, if allowed by the terms of the warranty.
- The date of the transaction, the identification of the lessor and consumer, and the address where the property will be primarily located during the possession of the consumer under the consumer rental purchase agreement.
- A statement that the consumer may terminate the agreement at any time without penalty by voluntarily surrendering or returning the property in good repair, ordinary wear and tear excepted, along with any payment of any past-due rent.
- Notice of the right to reinstate an agreement as provided in this chapter.
- A statement that the lessor is required by law to provide the consumer a written receipt, upon request by the consumer at the lessor’s place of business, for each payment made by cash or money order.
-
A consumer rental purchase agreement must contain, immediately above or adjacent to the place for the signature of the consumer, a clear, conspicuous, printed or typewritten notice, in boldface, ten-point type, substantially the following language:
- DO NOT SIGN THIS BEFORE YOU READ THE ENTIRE AGREEMENT, INCLUDING ANY WRITING ON THE REVERSE SIDE, EVEN IF TOLD YOU DO NOT NEED TO.
- DO NOT SIGN THIS IF IT CONTAINS ANY BLANK SPACES.
- YOU ARE ENTITLED TO AN EXACT COPY OF ANY AGREEMENT YOU SIGN.
- In a transaction involving more than one lessor, only one lessor is required to make the disclosures, but all lessors are bound by the disclosures. The disclosures must be made before the consumer rental purchase agreement is executed. The disclosures must be made clearly and conspicuously in writing in at least eight-point type and a copy of the disclosures and the consumer rental purchase agreement must be provided to the consumer. If a disclosure becomes inaccurate as a result of any act or occurrence caused by the consumer or by an agreement or consent entered into after delivery of the required disclosures, the resulting inaccuracy is not a violation of this chapter.
- Compliance with the Federal Consumer Leasing Act of 1976 [Pub. L. 94-240; 90 Stat. 257; 15 U.S.C. 1601, 1640, 1667-1667e] regarding disclosures in consumer rental purchase agreements satisfies the requirements of this section.
NOTICE TO CONSUMER — READ BEFORE SIGNING
Source:
S.L. 1993, ch. 450, § 3; 1999, ch. 50, § 67.
47-15.1-04. Prohibited provisions and agreements.
A consumer rental purchase agreement may not contain the following provisions, and, such included provision is not enforceable:
- A confession of judgment.
- A negotiable instrument.
- A security interest or any other claim of a property interest in any goods except those goods delivered by the lessor pursuant to the consumer rental purchase agreement.
- A wage assignment.
- A waiver by the consumer of claims or defenses.
- A provision authorizing the lessor or a person acting on the lessor’s behalf to enter upon the consumer’s premises or to commit any breach of the peace in the repossession of the goods.
Source:
S.L. 1993, ch. 450, § 4.
47-15.1-05. Reinstatement of agreement — Repossession.
-
A consumer who fails to make a timely rental payment may reinstate the agreement without losing any right or option that exists under the agreement by the payment of:
- All past-due rental charges;
- The reasonable costs of repossession and redelivery if the property has been repossessed; and
- Any applicable late fee within five days of the renewal date if the consumer pays monthly, or within two days of the renewal date if the consumer pays more frequently than monthly. A late fee may not be more than three dollars or five percent of the delinquent lease payment, whichever is greater.
- If a consumer has paid less than two-thirds of the total amount of payments necessary to acquire ownership and the consumer has returned or voluntarily surrendered the property other than through judicial process during the applicable reinstatement period set forth in this section, the consumer may reinstate the agreement during a period of not less than thirty-one days after the date of the return of the property.
- If a consumer has paid two-thirds or more of the total amount of payments necessary to acquire ownership and the consumer has returned or voluntarily surrendered the property other than through judicial process during the applicable period set forth in this section, the consumer may reinstate the agreement during a period of not less than forty-five days after the date of the return of the property.
- This section does not prevent a lessor from attempting to repossess property during the reinstatement period. A repossession does not affect the consumer’s right to reinstatement. Upon reinstatement, the lessor shall provide the consumer with the same property or substitute property of comparable quality and condition.
Source:
S.L. 1993, ch. 450, § 5.
47-15.1-06. Renegotiation for new agreement — Extensions.
-
A renegotiation of an agreement occurs when an existing consumer rental purchase agreement is satisfied and replaced by a new agreement undertaken by the same lessor and consumer. A renegotiation is considered a new agreement requiring new disclosures. The following events may not be treated as a renegotiation:
- The addition or return of property in a multiple-item agreement or in the substitution of leased property if the average payment allocation to a payment is not changed by more than twenty-five percent.
- A deferral of extension of one or more periodic payments or portions of a periodic payment.
- A reduction in charges in the lease or agreement.
- A lease or agreement that has become the basis for a legal action.
- No disclosure is required for any extension of a consumer rental purchase agreement under the same terms as the original agreement except for the extension.
Source:
S.L. 1993, ch. 450, § 6.
47-15.1-07. Advertisement of consumer rental purchase agreement.
-
If an advertisement for a consumer rental purchase agreement refers to or states the dollar amount of any payment and the right to acquire ownership of any one specific item, the advertisement must also clearly and conspicuously state the following items, as applicable:
- That the transaction advertised is a consumer rental purchase agreement;
- The total amount of payments necessary to acquire ownership; and
- That the consumer acquires no ownership rights if the total amount necessary to acquire ownership is not paid.
- Any owner or personnel of a medium in which an advertisement appears or through which an advertisement is disseminated is not liable for a violation of this section.
- This section does not apply to any advertisement that does not refer to or state the amount of any payment or which is published on radio, in the yellow pages of a telephone directory, or in any similar directory of business.
Source:
S.L. 1993, ch. 450, § 7.
47-15.1-08. Penalties — Remedies — Lessor to preserve evidence.
-
A lessor who fails to comply with this chapter is liable to the consumer for:
- The greater of the actual damages sustained by the consumer as a result of the violation or, in the case of an individual action, twenty-five percent of the total payments necessary to acquire ownership, but not less than one hundred dollars nor more than one thousand dollars; and
- The costs of the action and reasonable attorney’s fees.
- A lessor who violates section 47-15.1-07 is liable to the consumer for actual damages suffered from the violation, the costs of the action, and reasonable attorney’s fees.
- If there is more than one lessor, liability may be imposed only on the lessor who made the disclosures. When no disclosures have been made, liability must be imposed jointly and severally on all lessors.
- When there is more than one consumer, there may be only one recovery of damages under subsection 1.
- Multiple violations in connection with a single consumer rental purchase agreement entitle a consumer to only one recovery under this section.
- A consumer may not take any action to offset any amount for which a lessor is potentially liable under subsection 1 against any amount owed by the consumer unless the amount of the lessor’s liability has been determined by judgment of a court of competent jurisdiction in an action to which the lessor was a party. This subsection does not bar a consumer then in default on the obligation from asserting a violation of this chapter as an original action or as a defense or counterclaim to an action brought by the lessor to collect an amount owed by the consumer.
- In connection with any transaction under this chapter, the lessor shall preserve evidence of compliance with this chapter for not less than two years from the date of consummation of the agreement.
Source:
S.L. 1993, ch. 450, § 8.
CHAPTER 47-16 Leasing of Real Property
47-16-01. Leasing of real property — Definition.
Leasing is a contract by which one gives to another the temporary possession and use of real property for reward and the latter agrees to return such possession to the former at a future time.
Source:
Civ. C. 1877, § 1103; R.C. 1895, § 4069; R.C. 1899, § 4069; R.C. 1905, § 5516; C.L. 1913, § 6079; R.C. 1943, § 47-1601.
Derivation:
Cal. Civ. C., 1925.
Notes to Decisions
Agreement Constituted Lease.
District court did not err in ruling the 2013 agreement between the seller and the tenant was a lease which the landowner could not cancel at will because the landowner acquired the property subject to the rights of the tenants; the agreement stated it was effective until December 31, 2018, and contained provisions for monthly rent; up until the lawsuit, the parties treated the agreement as a lease; and the rent modification did not relieve the landowner of its obligations under the lease or allow it to eject the tenant from the property. Skaw ND Precast, LLC v. Oil Capital Ready Mix, LLC, 2019 ND 296, 936 N.W.2d 65, 2019 N.D. LEXIS 287 (N.D. 2019).
Conveyance of Interest in Land.
A real property lease is generally considered a contract and a conveyance of an interest in land. Diocese of Bismarck Trust v. Ramada, Inc., 553 N.W.2d 760, 1996 N.D. LEXIS 214 (N.D. 1996).
Reward May Be Labor or Services.
The reward for the possession and use of real property may be in the form of labor or services rendered, and a carpenter who paid no rent in money, but agreed to work two hours each evening for the privilege of living in an apartment, was a tenant. Huus v. Ringo, 76 N.D. 763, 39 N.W.2d 505, 1949 N.D. LEXIS 96 (N.D. 1949).
Collateral References.
What constitutes abandonment of residential or commercial lease — modern cases, 84 A.L.R.4th 183.
47-16-02. Limitations on leases.
No lease or grant of agricultural land reserving any rent or service of any kind for a longer period than ten years shall be valid. No lease or grant of any city lot reserving any rent or service of any kind for a longer period than ninety-nine years shall be valid.
Source:
Civ. C. 1877, § 203; R.C. 1895, § 3310; R.C. 1899, § 3310; S.L. 1903, ch. 151, § 1; R.C. 1905, § 4746; C.L. 1913, § 5289; R.C. 1943, § 47-1602.
Derivation:
Cal. Civ. C., 717.
Notes to Decisions
Agricultural Land.
In a partnership dispute, a reviewing court did not have to address a trial court’s interpretation of agricultural land in N.D.C.C. § 47-16-02 because, even assuming there was a possessory interest in a bin site, there was evidence to support the finding that a partner was not ejected from the bin site. The testimony showed that a truck was parked across a road to prevent the removal of equipment, but not to prevent the use of the bins. Knudson v. Kyllo, 2012 ND 155, 819 N.W.2d 511, 2012 N.D. LEXIS 155 (N.D. 2012).
A son's two leases with his mother for farmland were valid and enforceable because each was by operation of law limited to the life estate interest of the mother and thus contained a conditional term not necessarily in excess of 10 years. Vig v. Swenson, 2017 ND 285, 904 N.W.2d 489, 2017 N.D. LEXIS 296 (N.D. 2017).
District court erred in entering a judgment in favor of an owner following cross-motions for summary judgment because, even if the district court concluded that document at issue was subject to the 10-year statutory restriction of agricultural leases, the document was ambiguous with regard to whether it was an option to purchase, a contract for deed, or a lease, the court had to consider whether the document had a separate, distinct, and enforceable objective of providing the first lessee with a right of first refusal. Heitkamp v. Kabella, 2019 ND 96, 925 N.W.2d 446, 2019 N.D. LEXIS 101 (N.D. 2019).
Contracts Not Within Terms of Statute.
A lease of agricultural land “for the full term of forty years or during the full term of the natural life” of the lessees, for a certain cash consideration, conveyed a life estate and not an estate for years, and the same was not within the condemnation of this section. Wegner v. Lubenow, 12 N.D. 95, 95 N.W. 442, 1903 N.D. LEXIS 16 (N.D. 1903).
A contract whereby lower riparian owner, in consideration of furnishing electricity for fifteen years, conveyed to the upper riparian owner the right to discharge waste products into the stream to be carried off through the premises of the lower riparian owner was not void as condemned by this statute. Johnson v. Armour & Co., 69 N.D. 769, 291 N.W. 113, 1940 N.D. LEXIS 206 (N.D. 1940).
A lease of agricultural land reserving rent or service of any kind which “shall continue so long as any one of the owners is still alive”, although of indefinite duration, is not a lease for a longer period than ten years, and is valid for the life of the surviving lessor or at least ten years from the date of the complete execution thereof if she lives that long. Anderson v. Blixt, 72 N.W.2d 799, 1955 N.D. LEXIS 145 (N.D. 1955).
In order for the ban on leases of agricultural lands for a term of more than ten years to apply, the property must actually be leased for agricultural purposes, not merely suitable for such purposes; thus the term of a lease of a radio transmission tower site on farmland was not limited by the ten-year provision. Berry-Iverson Co. v. Johnson, 242 N.W.2d 126, 1976 N.D. LEXIS 222 (N.D. 1976).
Lease of agricultural lands for the purpose of mining sand, gravel, and rock was not subject to the ten-year limitation of this section where, although not specifically stated in the lease, a construction of the entire lease authorized the lessee to use the land for mining purposes only and did not authorize its use for agricultural purposes, and the land was in fact used only for mining purposes by the lessee. Trauger v. Helm Bros., 279 N.W.2d 406, 1979 N.D. LEXIS 256 (N.D. 1979).
District court properly declared that the tenants complied with a lease relating to grain and farm equipment storage, declared the lease remained in effect, and dismissed the landlord's eviction action because the leased property was not agricultural land where the lease plainly stated that it was not suitable for farming and excluded pasture land, and remained functional—which the family equated with “good condition and repair”—since the lease was executed. Zundel v. Zundel, 2017 ND 217, 901 N.W.2d 731, 2017 N.D. LEXIS 221 (N.D. 2017).
No Violation of Statute.
Language of the agreement used the term “in perpetuity” in conjunction with other terms, including allowing the sale of the property at any time and the ability to opt out, and either the lessor or the lessee could terminate the lease within 10 years and both were uncertain events, and thus the agreement did not necessarily extend for a period longer than 10 years under the statute, and the district court did not err in finding the agreement did not violate the statute and was not invalid. Anderson v. Lyons, 2014 ND 61, 845 N.W.2d 1, 2014 N.D. LEXIS 62 (N.D. 2014).
“Rent” Defined.
The term “rent” is a profit arising out of land and payable periodically. Wegner v. Lubenow, 12 N.D. 95, 95 N.W. 442, 1903 N.D. LEXIS 16 (N.D. 1903); Johnson v. Armour & Co., 69 N.D. 769, 291 N.W. 113, 1940 N.D. LEXIS 206 (N.D. 1940).
Collateral References.
Construction and effect of statutes limiting duration of agricultural leases, 17 A.L.R.2d 566.
47-16-02.1. Rent controls — Prohibited.
A political subdivision may not enact, maintain, or enforce an ordinance or resolution that would have the effect of controlling the amount of rent charged for leasing private residential or commercial property. This section does not impair the right of a political subdivision to manage and control residential property in which the political subdivision has a fee title interest.
Source:
S.L. 1993, ch. 451, § 1.
47-16-03. Filing farm lease containing reservation of title to crop — Waiver of rights on failure to file.
- When a lease of a farm contains a provision reserving title in the lessor to any part of the crops in excess of the rental share of the lessor until the stated conditions of the lease have been complied with by the lessee, such lease must be filed in the office of the recorder in the county in which the land described therein is located if notice by a real estate recording is sought, and must be filed electronically in the central indexing system if recording in the central notice system is sought, prior to July first in the year in which the crops are raised to render such reservation of title effective as to subsequent purchasers or encumbrancers of any part of the grain over and above the lessor’s rental share produced upon the land.
- The failure to file such lease or contract in accordance with this section constitutes a waiver by the lessor of all rights reserved by that person over and above that person’s rental share in such crops as against any subsequent purchaser or encumbrancer of the lessee.
- The secretary of state shall provide an electronic system that includes the pertinent information from the lease that may be filed in the central notice system. A lessor may file this electronic statement and obtain the same rights under this section as if the lessor had filed the lease.
-
The fee required to file and index this notice of lease is:
- As provided in section 11-18-05, if the notice of lease is only a real estate recording;
- As provided in section 41-09-96, if the notice of lease is filed only to gain protection under the central notice system; or
- As provided in section 11-18-05, if a real estate recording is sought and according to section 41-09-96 if electronically filed to gain protection under the central notice system.
Source:
S.L. 1941, ch. 5, § 1; R.C. 1943, § 47-1603; S.L. 1987, ch. 552, § 1; 2001, ch. 120, § 1; 2011, ch. 250, § 5; 2013, ch. 257, § 31.
Effective Date.
The 2013 amendment of this section by section 31 of chapter 257, S.L. 2013 becomes effective August 1, 2015, or earlier (See contingency note below).
Note.
Section 50 of chapter 257, S.L. 2013 provides: “CONTINGENT EFFECTIVE DATE. Sections 1 through 27 and sections 29 through 47 of this Act become effective August 1, 2015, or earlier if the secretary of state makes a report to the legislative management and to the information technology committee certifying that the information technology components of the electronic filing system are ready for implementation of those provisions of this Act, in which case those sections become effective ninety days following the completion of the certificate requirement.” [Ch. 372 amends chapter 257 of 2013 to provide a new effective date, August 1, 2016.]
Cross-References.
Record title, see N.D.C.C. ch. 47-19.
Notes to Decisions
Applicability.
The filing requirement applies to any lease that reserves an interest in crops, and not just those leases containing conditions. The title of the original act supports this conclusion. In re Wild, 795 F.2d 666, 1986 U.S. App. LEXIS 27181 (8th Cir. N.D. 1986).
The applicability of this section does not turn on the nature of the landlord’s claim of interest, whether it be a mere lien or claim of title as owner. In re Wild, 50 B.R. 410, 1985 Bankr. LEXIS 6763 (Bankr. D.N.D. 1985).
Effect of Failure to File.
Failure to file is a waiver of rights by the lessor only against subsequent purchasers or encumbrancers in good faith of the lessee. The statute does not make a reservation of title void. KERN v. KELNER, 75 N.D. 292, 27 N.W.2d 567, 1947 N.D. LEXIS 68 (N.D. 1947).
The reservation of interests in crops is ineffective against subsequent purchasers and encumbrancers unless the lessor files the lease with the register of deeds [now recorder]. In re Wild, 795 F.2d 666, 1986 U.S. App. LEXIS 27181 (8th Cir. N.D. 1986).
If the lessor intends to reserve a title interest, that interest may be preserved as against the lessee by merely entering into an agreement for the same. If, however, such reservations are to be effective as against subsequent purchasers and encumbrancers of the lessee, then the lease providing for an exception to the general law of N.D.C.C. § 47-16-04 must be filed with the register of deeds [now recorder]. Failure to file a lease as required constitutes a waiver by the lessor of all rights reserved by him in the crops. Even a reservation of a title interest may be lost in this fashion. In re Wild, 50 B.R. 410, 1985 Bankr. LEXIS 6763 (Bankr. D.N.D. 1985).
Purpose of Filing Requirement.
The purpose of requiring a lessor to file a lease if he wishes to preserve his claim of interest or reserve title in crops grown on a leasehold is to protect third parties who otherwise would have no knowledge of what the arrangement might be between the lessor and lessee and would assume that all crops grown belonged to the lessee and were thus available to satisfy their liens. In re Wild, 50 B.R. 410, 1985 Bankr. LEXIS 6763 (Bankr. D.N.D. 1985).
Trial court erred in concluding that N.D.C.C. § 47-16-03 applies to lessor’s cash rent lease to give her priority over a bank in crop proceeds because the statute applies only to crop-share agreements. Sec. State Bank v. Orvik, 2001 ND 197, 636 N.W.2d 664, 2001 N.D. LEXIS 225 (N.D. 2001).
Collateral References.
Reservation of vendor’s crop rights in land contract, effectiveness of, in absence of such reservation in deed later executed, 8 A.L.R.2d 565.
Garnishment, sharecropper’s share in crop wholly or partly unharvested as subject to, 82 A.L.R.2d 858.
47-16-04. Products during lease belong to lessee — Exception.
In the absence of any agreement to the contrary between the lessor and the lessee, the products received from real property during the term of a lease belong to the lessee.
Source:
Civ. C. 1877, § 1104; R.C. 1895, § 4070; R.C. 1899, § 4070; R.C. 1905, § 5517; C.L. 1913, § 6080; R.C. 1943, 47-1604; S.L. 1987, ch. 552, § 2.
Derivation:
Cal. Civ. C., 1926.
Cross-References.
Rights of tenant for years or at will, see N.D.C.C. § 47-16-27.
Notes to Decisions
- Application to Lease of Real Property.
- Express Agreement Required.
- Parties May Agree Otherwise.
- When Filing Is Required.
Application to Lease of Real Property.
This section is applicable to a lease of real property in the absence of an agreement by the parties to the contrary. Hamilton v. Winter, 281 N.W.2d 54, 1979 N.D. LEXIS 266 (N.D. 1979).
Express Agreement Required.
If an interest of any kind is to be retained by or preserved in the lessor, it must be by express agreement of the parties. In re Wild, 50 B.R. 410, 1985 Bankr. LEXIS 6763 (Bankr. D.N.D. 1985).
Parties May Agree Otherwise.
This section does not prevent the parties from agreeing otherwise, and a lessee may waive his right and be a party to a contract governed by N.D.C.C. § 47-16-03. KERN v. KELNER, 75 N.D. 292, 27 N.W.2d 567, 1947 N.D. LEXIS 68 (N.D. 1947).
The result of this section may be altered by an agreement between the lessor and the lessee. In re Wild, 795 F.2d 666, 1986 U.S. App. LEXIS 27181 (8th Cir. N.D. 1986).
When Filing Is Required.
If the lessor intends to reserve a title interest, that interest may be preserved as against the lessee by merely entering into an agreement for the same. If, however, such reservations are to be effective as against subsequent purchasers and encumbrancers of the lessee, then the lease providing for an exception to the general law of this section must be filed with the register of deeds [now recorder]. Failure to file a lease as required constitutes a waiver by the lessor of all rights reserved by him in the crops. Even a reservation of a title interest may be lost in this fashion. In re Wild, 50 B.R. 410, 1985 Bankr. LEXIS 6763 (Bankr. D.N.D. 1985).
47-16-05. Lease of realty presumed for one year.
A lease of real property, other than lodgings, in places where there is no usage on the subject, is presumed to be for one year from its commencement, unless otherwise expressed in the lease.
Source:
Civ. C. 1877, § 1116; R.C. 1895, § 4082; R.C. 1899, § 4082; R.C. 1905, § 5529; C.L. 1913, § 6092; R.C. 1943, § 47-1605.
Derivation:
Cal. Civ. C., 1943.
Notes to Decisions
Application of Presumption.
The statutory presumption was applicable in a case where there was a lease of premises for the purpose of carrying on mercantile business and there was no evidence of any established usage respecting the rental of business property in the city where the premises were located. Foster v. National Tea Co., 74 N.D. 37, 19 N.W.2d 760, 1945 N.D. LEXIS 50 (N.D. 1945).
Where lessor placed lessee in possession of the premises as a tenant, while the parties negotiated the final terms of a contemplated long-term lease, and lessee partially performed its duties, even if the trial court determined that the parties did not agree to a long-term lease, lessee had a one-year lease under this section, absent further evidence sufficient to overcome the presumption of a one-year lease. Stonewood Hotel Corp. v. Davis Dev., 447 N.W.2d 286, 1989 N.D. LEXIS 205 (N.D. 1989).
The presumption in this section controlled where tenant went into possession as a tenant, owner did not sign proposed long-term lease, the parties did not agree that the tenancy was month-to-month, and no evidence of usage was presented. Stonewood Hotel Corp. v. Seven Seas, 452 N.W.2d 94, 1990 N.D. LEXIS 49 (N.D. 1990).
47-16-06. When a lease is presumed renewed.
If a lessee of real property remains in possession of the real property after the expiration of the lease and the lessor accepts rent from the lessee, the parties are presumed to have renewed the lease on the same terms and for the same time, not exceeding one year. Except in the case of a lease with an automatic renewal clause, if a lessee of real property for residential purposes remains in possession of the property after the expiration of the lease and the lessor accepts rent from the lessee, the parties are presumed to have renewed the lease as a month-to-month tenancy.
Source:
Civ. C. 1877, § 1118; R.C. 1895, § 4084; R.C. 1899, § 4084; R.C. 1905, § 5531; C.L. 1913, § 6094; R.C. 1943, § 47-1606; S.L. 2007, ch. 399, § 1.
Derivation:
Cal. Civ. C., 1945.
Notes to Decisions
- Acceptance of Rent.
- Change in Written Contract.
- Continuation of Written Contract.
- Disputable Presumption.
- Implied Tenancy Is a New Tenancy.
- Termination of Lease.
Acceptance of Rent.
The acceptance of rent operates as evidence that the landlord consents to the renewal or extension of the contract, and, where the evidence is adequate to establish such consent without a receipt of rent, the receipt or failure to receive the rent is not material. Wadsworth v. Owens, 21 N.D. 255, 130 N.W. 932, 1911 N.D. LEXIS 92 (N.D. 1911).
Change in Written Contract.
A change in a written contract of lease relating to the furnishing of seed and crop division did not alter the nature or break the continuity of a holding so as to terminate a year to year hold-over tenancy. TIMM v. ARVIDSON, 58 N.D. 634, 227 N.W. 59, 1929 N.D. LEXIS 259 (N.D. 1929).
Continuation of Written Contract.
If the lessee remains in possession after the expiration of the hiring and the lessor accepts rent from him, the parties are presumed to have renewed the hirings on the same terms and for the same time, not exceeding one year, and the rights of the parties are governed by the provisions of the contract which had expired. Herrmann v. Minnekota Elevator Co., 27 N.D. 235, 145 N.W. 821, 1914 N.D. LEXIS 33 (N.D. 1914), overruled, Minneapolis Iron Store Co. v. Branum, 36 N.D. 355, 162 N.W. 543, 1917 N.D. LEXIS 194 (N.D. 1917); TIMM v. ARVIDSON, 58 N.D. 634, 227 N.W. 59, 1929 N.D. LEXIS 259 (N.D. 1929).
Where tenant retained possession of farm after the expiration of the original term of the lease, the written farming contract or lease executed in 1940 continued in force as a document to be considered in determination of what arrangements landlord had with tenant in 1956 to 1958 for qualifying the landlord for old-age benefits. Celebrezze v. Benson, 314 F.2d 219, 1963 U.S. App. LEXIS 5941 (8th Cir. N.D. 1963).
Disputable Presumption.
The presumption raised by this section is disputable and where it appeared that the lessor and the lessee were dissatisfied with the conditions of the lease and for some time had been conducting negotiations for a new lease, the evidence disputed the presumption of extension or renewal. Foster v. National Tea Co., 74 N.D. 37, 19 N.W.2d 760, 1945 N.D. LEXIS 50 (N.D. 1945).
This section only raises a disputable presumption that the lease was renewed on the same terms. Willman v. Harty Co., 305 N.W.2d 909, 1981 N.D. LEXIS 294 (N.D. 1981), overruled, Shark v. Thompson, 373 N.W.2d 859, 1985 N.D. LEXIS 387 (N.D. 1985).
Trial court’s finding that the landlord was entitled to evict a holdover tenant under N.D.C.C. § 47-32-01(4) after expiration of the commercial lease was not clearly erroneous. The evidence rebutted the presumption of automatic lease renewal under N.D.C.C. § 47-16-06 for an additional term, because the tenant was in default of lease and failed to timely pay the security deposit required for lease renewal. Working Capital # 1, LLC v. Quality Auto Body, Inc., 2012 ND 115, 817 N.W.2d 346, 2012 N.D. LEXIS 107 (N.D. 2012).
Implied Tenancy Is a New Tenancy.
A mortgage given to secure the prompt payment of rent according to the terms of a written lease does not secure rents which become due after the expiration of the lease and under a tenancy arising by implication of law. Field v. Mott, 9 N.D. 621, 84 N.W. 555 (1900).
Termination of Lease.
Court did not err in holding that the leases terminated on December 31, 2011 and in dismissing the lessee's counterclaims because there was no automatic renewal, the lessors' letter sent to the lessee was effective to exercise the lessors' right to terminate the leases for any cause at the end of the one-year term, the lessee failed to raise a genuine issue of material fact about corporate ratification, and the lessee's counterclaim was time-barred as a matter of law. Funke v. Aggregate Constr., Inc., 2015 ND 123, 863 N.W.2d 855, 2015 N.D. LEXIS 121 (N.D. 2015).
Collateral References.
Landlord’s consent to extension or renewal of lease as shown by acceptance of rent from tenant holding over, 45 A.L.R.2d 827.
Binding effect on tenant holding over of covenants in expired lease, 49 A.L.R.2d 480.
Options: holding over under lease, or renewal or extension thereof, as extending time for exercise of option to purchase contained therein, 15 A.L.R.3d 470.
Sublessee’s rights with respect to primary lessee’s option to renew lease, 39 A.L.R.4th 824.
47-16-06.1. Automatic renewal of leases of residential real property — When notice required.
Notwithstanding the provisions of section 47-16-06, in any lease of a specified term of two months or more of real property used for residential purposes, the lessor may not enforce an automatic renewal clause of a lease unless the lessor has notified the lessee in writing, delivered personally or by first-class mail, of the automatic renewal provision, not less than thirty days prior to the expiration date of the current lease. If such notice has not been given, the lease expires, and the terms of the latest lease convert to a month-to-month tenancy.
Source:
S.L. 1991, ch. 487, § 1.
47-16-07. Leases — Notice by landlord to change terms — When effective.
In all leases of land or tenements, or of any interest therein, from month to month, the landlord may change the terms of the lease to take effect at the expiration of the month upon giving notice in writing at least thirty days before the expiration of the month. The notice, when served upon the tenant, shall operate and be effectual to create and establish as a part of the lease the terms, rent, and conditions specified in the notice, if the tenant shall continue to hold the premises after the expiration of the month. For the purpose of this section, notice may be served in any reasonable manner which actually informs the tenant of the changes in the terms of the lease.
Source:
Civ. C. 1877, § 261; R.C. 1895, § 3368; R.C. 1899, § 3368; R.C. 1905, § 4804; C.L. 1913, § 5347; R.C. 1943, § 47-1607; S.L. 1979, ch. 486, § 1.
Derivation:
Cal. Civ. C., 827.
Collateral References.
Notice: inclusion or exclusion of first and last days in computing time for giving notice of termination of lease which must be given a certain number of days before a known future date, 98 A.L.R.2d 1331.
Application to commercial lease of rule that lease may be canceled only for “material” breach, 54 A.L.R.4th 595.
47-16-07.1. Real property and dwelling security deposits — Limitations and requirements.
-
The lessor of real property or a dwelling who requires money as a security deposit, however denominated, shall deposit the money in a federally insured interest-bearing savings or checking account for the benefit of the tenant. The security deposit and any interest accruing on the deposit must be paid to the lessee upon termination of a lease, subject to the conditions of subsection 2. A lessor may not demand or receive security, however denominated, in an amount or value in excess of one month’s rent, except:
- A lessor may accept an amount or value up to two month’s rent, as security, from an individual convicted of a felony offense as an incentive to rent the property to the individual.
- A lessor may demand an amount or value up to two months rent, as security, from an individual who has had a judgment entered against that individual for violating the terms of a previous rental agreement.
- A lessor may charge a lessee a pet security deposit for keeping an animal that is not a service animal or companion animal required by a tenant with a disability as a reasonable accommodation under fair housing laws. A pet security deposit may not exceed the greater of two thousand five hundred dollars or an amount equivalent to two months’ rent.
-
A lessor may apply security deposit money and accrued interest upon termination of a lease towards:
- Any damages the lessor has suffered by reason of deteriorations or injuries to the real property or dwelling by the lessee’s pet or through the negligence of the lessee or the lessee’s guest.
- Any unpaid rent.
- The costs of cleaning or other repairs which were the responsibility of the lessee, and which are necessary to return the dwelling unit to its original state when the lessee took possession, reasonable wear and tear excepted.
- A lessor is liable for treble damages for any security deposit money withheld without reasonable justification.
- Upon a transfer in ownership of the leased real property or dwelling, the security deposit and accrued interest shall be transferred to the grantee of the lessor’s interest. The grantor shall not be relieved of liability under this section until transfer of the security deposit to the grantee. The holder of the lessor’s interest in the real property or dwelling at the termination of a lease shall be bound by this section even though such holder was not the original lessor who received the security deposit.
- This section applies to the state and to political subdivisions of the state that lease real property or dwellings and require money as a security deposit.
Application of any portion of a security deposit not paid to the lessee upon termination of the lease must be itemized by the lessor. Such itemization together with the amount due must be delivered or mailed to the lessee at the last address furnished lessor, along with a written notice within thirty days after termination of the lease and delivery of possession by the lessee. The notice must contain a statement of any amount still due the lessor or the refund due the lessee. A lessor is not required to pay interest on security deposits if the period of occupancy was less than nine months in duration. Any amounts not claimed from the lessor by the lessee within one year of the termination of the lease agreement are subject to the reporting requirements of section 47-30.2-04.
Source:
S.L. 1977, ch. 428, § 1; 1979, ch. 487, § 1; 1983, ch. 505, § 1; 1985, ch. 507, § 1; 1989, ch. 553, § 1; 1995, ch. 437, § 1; 2003, ch. 393, § 1; 2007, ch. 400, § 1; 2009, ch. 393, § 1; 2015, ch. 312, § 1, eff August 1, 2015; 2017, ch. 316, § 1, eff August 1, 2017; 2019, ch. 379, § 1, eff August 1, 2019; 2021, ch. 337, § 16, eff July 1, 2021.
Effective Date.
The 2015 amendment of this section by section 1 of chapter 312, S.L. 2015 became effective August 1, 2015.
Notes to Decisions
Deposit Withheld Unreasonably.
The determination of whether a security deposit is withheld unreasonably is a question of fact and will not be overturned unless clearly erroneous. Mitchell v. Preusse, 358 N.W.2d 511, 1984 N.D. LEXIS 418 (N.D. 1984).
Trial court’s conclusion that landlord unreasonably withheld security deposit after consenting to tenants’ cancellation of lease upon his failure to make apartment habitable within a reasonable time, thus breaching rental contract, would be affirmed. Mitchell v. Preusse, 358 N.W.2d 511, 1984 N.D. LEXIS 418 (N.D. 1984).
Collateral References.
Advance rental payments made under lease terms, right of lessor to retain upon lessee’s default in rent, 27 A.L.R.2d 656.
Guarantor: liability of lessee’s guarantor or surety beyond the original period fixed by lease, 10 A.L.R.3d 582.
Landlord-tenant security deposit legislation, 63 A.L.R.4th 901.
Law Reviews.
For Article: Landlord Weapon or Tenant Shield? A Proposal to Reform North Dakota’s Residential Security Deposit Statute, see 85 N.D. L. Rev. 251 (2009).
47-16-07.2. Statement detailing condition of premises to accompany rental agreement.
A landlord shall provide the tenant with a statement describing the condition of the facilities in and about the premises to be rented at the time of entering a rental agreement. The statement shall be agreed to and signed by the landlord and tenant. The statement shall constitute prima facie proof of the condition of the facilities and the premises at the beginning of the rental agreement.
Source:
S.L. 1981, ch. 464, § 2.
47-16-07.3. When landlord may enter apartment.
A landlord may enter the dwelling unit:
- At any time in case of emergency or if the landlord reasonably believes the tenant has abandoned the premises, or the landlord reasonably believes the tenant is in substantial violation of the provisions of the lease or rental agreement.
- Only during reasonable hours, and in a reasonable manner, for the purpose of inspecting the premises; for making necessary or agreed repairs, decorations, alterations, or improvements; for supplying necessary or agreed services; or for exhibiting the residential dwelling unit to actual or potential purchasers, insurers, mortgagees, real estate agents, tenants, workmen, or contractors. Unless it is impractical to do so the landlord shall first notify and receive the consent of the tenant which shall not be unreasonably withheld, which consent shall identify a time certain. A landlord shall not abuse the right of access or use it to harass or intimidate the tenant.
For the purposes of this section, consent shall be presumed from failure to object to access after notice of intent to enter at a time certain has been given. Notice may be given by personal service, by posting the notice in a conspicuous place in or about the dwelling unit for a reasonable period of time, or by any other method which results in actual notice to the tenant.
Source:
S.L. 1981, ch. 464, § 1.
47-16-07.4. Fraudulent misrepresentations — Receipt of security deposit.
A lease or rental agreement for real property or a dwelling unit which is entered into upon partial or total reliance of fraudulent misrepresentations may be terminated by the party fraudulently induced into the lease or rental agreement and that party shall receive any security deposit made pursuant to the lease or rental agreement together with any accrued interest on the deposit.
Source:
S.L. 1983, ch. 506, § 3.
47-16-07.5. Disability documentation for service or assistance animal in rental dwelling.
A landlord may require reliable supporting documentation be provided by a tenant of a rental dwelling that is subject to a no pets policy, if the tenant asserts a disability requiring a service animal or assistance animal be allowed as an accommodation on the rented premises under any provision of law. Reliable supporting documentation may be provided by a physician or medical professional who does not operate in this state solely to provide certification for service or assistance animals. Reliable supporting documentation must confirm the tenant’s disability and the relationship between the tenant’s disability and the need for the requested accommodation. A landlord may not require supporting documentation from a tenant if the tenant’s disability or disability-related need for a service animal or assistance animal is readily apparent or already known to the landlord.
History. S.L. 2015, ch. 313, § 1, eff August 1, 2015; 2017, ch. 317, § 1, eff August 1, 2017.
Effective Date.
This section became effective August 1, 2015.
47-16-07.6. Service animals — Housing — Penalties for furnishing fraudulent disability documentation.
- An individual is guilty of an infraction if the individual, in an attempt to obtain a reasonable housing accommodation under section 47-16-07.5, knowingly makes a false claim of having a disability that requires the use of a service animal or assistance animal or knowingly provides fraudulent supporting documentation in connection with such a claim.
- If the individual pleads guilty or is convicted of an offense under subsection 1, a lessor may evict a lessee and the lessor is entitled to a damage fee, not to exceed one thousand dollars, from a lessee if the lessee provides fraudulent disability documentation indicating a disability requiring the use of a service animal or assistance animal.
Source:
S.L. 2017, ch. 317, § 2, eff August 1, 2017.
47-16-08. Quiet possession of leased property.
An agreement to lease real property binds the lessor to secure to the lessee the quiet possession of such property during the term of the lease against all persons lawfully claiming the same.
Source:
Civ. C. 1877, § 1105; R.C. 1895, § 4071; R.C. 1899, § 4071; R.C. 1905, § 5518; C.L. 1913, § 6081; R.C. 1943, § 47-1608.
Derivation:
Cal. Civ. C., 1927.
Notes to Decisions
Duty of Landlord.
A landlord is not answerable in damages to a tenant for eviction from leased property unless the eviction be due to some wrongful act on the part of the landlord, either personally or by some person acting under his authority, or by or through such person, or because of some paramount title. Smith v. Nortz Lumber Co., 72 N.D. 353, 7 N.W.2d 435, 1943 N.D. LEXIS 74 (N.D. 1943).
Lease of Joint Tenancy.
Where one joint tenant leased her own interest in the common property to another without the consent of the other joint tenant, the lessees succeeded to the rights of the lessor, and were entitled to enjoy the possession of the property with the other joint tenant as a joint tenant with an undivided one-half interest in the property. Bangen v. Bartelson, 553 N.W.2d 754, 1996 N.D. LEXIS 216 (N.D. 1996).
Collateral References.
Breach of covenant of quiet enjoyment as basis of landlord’s liability for injury to tenant’s personal property caused by water overflowing from defective appliances in other premises of landlord, 26 A.L.R.2d 1044, 1047.
Breach of covenant for quiet enjoyment in lease, 41 A.L.R.2d 1414, 1454.
47-16-09. Ordinary care must be exercised by lessee.
The lessee of real property must use ordinary care to preserve such property in safety and to keep it in good condition.
Source:
Civ. C. 1877, § 1106; R.C. 1895, § 4072; R.C. 1899, § 4072; R.C. 1905, § 5519; C.L. 1913, § 6082; R.C. 1943, § 47-1609.
Derivation:
Cal. Civ. C., 1928.
Cross-References.
Tenant’s obligations as to maintenance of residential dwelling unit, see N.D.C.C.§ 47-16-13.2.
Collateral References.
Neglect: liability of tenant for damages to leased property due to his acts or neglect, 10 A.L.R.2d 1012.
Extent of lessee’s obligation under covenant to surrender premises in prescribed condition of repair, 20 A.L.R.2d 1331, 1339.
Tort liability to third persons, tenant’s obligation under lease as basis of, 44 A.L.R.3d 943.
47-16-10. Injuries to real property — Must be repaired by lessee.
The lessee of real property must repair all deteriorations or injuries thereto occasioned by the lessee’s ordinary negligence.
Source:
Civ. C. 1877, § 1107; R.C. 1895, § 4073; R.C. 1899, § 4073; R.C. 1905, § 5520; C.L. 1913, § 6083; R.C. 1943, § 47-1610.
Derivation:
Cal. Civ. C., 1929.
Collateral References.
Who, as between landlord and tenant, must make or bear expense of alterations, improvements or repairs ordered by public authorities, 22 A.L.R.3d 521.
Measure and elements of damages for lessee’s breach of covenant as to repairs, 45 A.L.R.5th 251.
47-16-11. Use of real property for purpose leased — Violation.
When real property is leased for a particular purpose, the lessee must not use it for any other purpose. If the lessee violates the lease in this respect, the lessor may hold the lessee responsible for the safety of the property during such use in all events or may treat the contract as rescinded thereby.
Source:
Civ. C. 1877, § 1108; R.C. 1895, § 4074; R.C. 1899, § 4074; R.C. 1905, § 5521; C.L. 1913, § 6084; R.C. 1943, § 47-1611.
Derivation:
Cal. Civ. C., 1930.
Notes to Decisions
Provision Against Subletting.
A provision in a lease forbidding the subletting of the whole of the premises necessarily forbids the subletting of a part thereof. Minneapolis, S. P. & S. S. M. Ry. v. Duvall, 67 N.W.2d 593, 1954 N.D. LEXIS 117 (N.D. 1954).
Collateral References.
Subletting or renting part of premises as violation of lease provision as to subletting, 56 A.L.R.2d 1002.
Zoning regulations restricting contemplated use of premises, rights between landlord and tenant as affected by, 37 A.L.R.3d 1018.
Grazing or pasturage agreement as violation of covenant in lease or provision of statute against assigning or subletting without lessor’s consent, 71 A.L.R.3d 780.
Express or implied restriction on lessee’s use of residential property for business purposes, 46 A.L.R.4th 496.
47-16-12. Obligations of lessor to repair dwelling. [Repealed]
Repealed by S.L. 1977, ch. 429, § 7.
Note.
For present provisions, see § 47-16-13.1.
47-16-13. When lessee may repair or vacate premises.
If within a reasonable time after notice from the lessee of dilapidations which the lessor ought to repair the lessor neglects to do so, the lessee may:
- Repair the premises and deduct the expense of such repair from the rent;
- Recover it in any other lawful manner from the lessor; or
- Vacate the premises, in which case the lessee shall be discharged from further payment of rent or performance of other conditions.
Source:
Civ. C. 1877, § 1115; R.C. 1895, § 4081; R.C. 1899, § 4081; R.C. 1905, § 5528; C.L. 1913, § 6091; R.C. 1943, § 47-1613.
Derivation:
Cal. Civ. C., 1942.
Notes to Decisions
Common-Law Relationship Not Altered.
While this section and repealed N.D.C.C. § 47-16-12 gave tenant new remedies against a landlord they do not otherwise alter the relationship of landlord and tenant under the rule of the common law. Newman v. Sears, Roebuck & Co., 77 N.D. 466, 43 N.W.2d 411, 1950 N.D. LEXIS 143 (N.D. 1950).
Notice to Vacate.
This section requires a lessee to give the lessor notice before vacating the premises. Hofmann v. Stoller, 320 N.W.2d 786, 1982 N.D. LEXIS 309 (N.D. 1982).
Where lessee provided lessor with written notice of his intent to terminate the lease and vacate the premises two months prior to vacating and also made several verbal complaints regarding the property in person and by telephone, this was sufficient evidence to support the trial court’s finding that the lessor received notice under this section. Pfeifle v. Tanabe, 2000 ND 219, 620 N.W.2d 167, 2000 N.D. LEXIS 269 (N.D. 2000).
Sewer Connection.
In lessor’s action to recover rent, lessee could not counterclaim damages caused by failure to connect the cellar of dwelling with a sewer, there being no showing of an express contract so to do; the sewer connection would have been a new improvement rather than a repair. Torreson v. Walla, 11 N.D. 481, 92 N.W. 834, 1902 N.D. LEXIS 242 (N.D. 1902).
Tenant’s Remedies.
In response to landlord’s claim for rent due, tenant asserted its right to either abate by virtue of deprivation of use of fire-damaged elevator unrepaired by landlord, or to deduct for the cost of repairs made by tenant following landlord’s failure to repair within a reasonable time pursuant to two lease clauses and this section. Peterson v. Front Page, Inc., 462 N.W.2d 157, 1990 N.D. LEXIS 226 (N.D. 1990).
Commercial landlord’s failure to repair leaking roof and malfunctioning air conditioning unit in a store after repeated demands from the tenant left the premises unfit for occupancy for the purposes for which they were intended and constituted a constructive eviction justifying the tenant’s vacating the premises. CAP Partners v. Cameron, 1999 ND 178, 599 N.W.2d 309, 1999 N.D. LEXIS 198 (N.D. 1999).
Collateral References.
Tenant’s right to make repairs or rebuild at landlord’s cost, where landlord has covenanted to repair, 28 A.L.R.2d 464.
Fire, duty of landlord under express covenant to repair, rebuild, or restore, where property is damaged or destroyed by, 38 A.L.R.2d 682.
Suit: capacity of tenant to sue independent contractor, as third-party beneficiary, for breach of contract between landlord and such contractor for repair or remodeling work, 46 A.L.R.2d 1210.
Who, as between landlord and tenant, must make or bear expense of alterations, improvements or repairs ordered by public authorities, 22 A.L.R.3d 521.
Rent strike: validity and construction of statute or ordinance authorizing withholding or payment into escrow of rent for period during which premisses are not properly maintained by landlord, 40 A.L.R.3d 821.
Set-off against rent: tenant’s right, where landlord fails to make repairs, to have them made and set-off cost against rent, 40 A.L.R.3d 1369.
Class action: propriety of class action in state courts to assert tenants’ rights against landlord, 73 A.L.R.3d 852.
47-16-13.1. Landlord obligations — Maintenance of premises.
-
A landlord of a residential dwelling unit shall:
- Comply with the requirements of applicable building and housing codes materially affecting health and safety.
- Make all repairs and do whatever is necessary to put and keep the premises in a fit and habitable condition.
- Keep all common areas of the premises in a clean and safe condition.
- Maintain in good and safe working order and condition all electrical, plumbing, sanitary, heating, ventilating, air-conditioning, and other facilities and appliances, including elevators, supplied or required to be supplied by the landlord.
- Provide and maintain appropriate receptacles and conveniences for the removal of ashes, garbage, rubbish, and other waste incidental to the occupancy of the dwelling unit and arrange for their removal.
- Supply running water and reasonable amounts of hot water at all times and reasonable heat, except if the building that includes the dwelling unit is not required by law to be equipped for that purpose or if the dwelling unit is so constructed that heat or hot water is generated by an installation within the exclusive control of the tenant and supplied by a direct public utility connection or if the water or heat is unavailable due to supply failure by a public utility.
- In case of noncompliance with the requirements of subdivisions b through f of subsection 1, a reasonable time shall be allowed to remedy such noncompliance.
- If the duty imposed by subdivision a of subsection 1 is greater than any duty imposed by any other subdivision of that subsection, the landlord’s duty shall be determined by reference to subdivision a of subsection 1.
- The landlord and tenant of a single-family residence may agree in writing that the tenant perform the landlord’s duties specified in subdivisions e and f of subsection 1 and also specified repairs, maintenance tasks, alterations, and remodeling, but only if the transaction is entered into in good faith.
-
The landlord and tenant of any dwelling unit other than a single-family residence may agree that the tenant is to perform specified repairs, maintenance tasks, alterations, or remodeling only if:
- The agreement of the parties is entered into in good faith and is set forth in a separate writing signed by the parties and supported by adequate consideration.
- The work is not necessary to cure noncompliance with subdivision e of subsection 1.
- The agreement does not diminish or affect the obligation of the landlord to other tenants in the premises.
- The landlord may not treat performance of the separate agreement described in subsection 4 as a condition to any obligation or performance of any rental agreement.
Source:
S.L. 1977, ch. 429, § 1.
Notes to Decisions
- Animals.
- Inapplicability to Commercial Leases.
- Maintenance of Habitable Premises.
- Waiver of Landlord’s Breach.
Animals.
In an action for injuries incurred by a child who was clawed by a cat on rental property owned by a housing authority, the trial court’s instructions improperly failed to state that the housing authority was not liable for such injury unless it knew or had reason to know of the animal’s dangerous or vicious propensities. Amyotte v. Rolette County Hous. Auth., 2003 ND 48, 658 N.W.2d 324, 2003 N.D. LEXIS 53 (N.D. 2003).
Inapplicability to Commercial Leases.
There is no statutory authority or case law authority in North Dakota that supports the argument for an implied warranty of habitability or fitness for a lease on commercial property. B.W.S. B.W.S. Inv. v. Mid-Am Restaurants, 459 N.W.2d 759, 1990 N.D. LEXIS 160 (N.D. 1990).
Maintenance of Habitable Premises.
Trial court’s conclusion that landlord unreasonably withheld security deposit after consenting to tenants’ cancellation of lease upon his failure to make apartment habitable within a reasonable time, thus breaching rental contract, would be affirmed. Mitchell v. Preusse, 358 N.W.2d 511, 1984 N.D. LEXIS 418 (N.D. 1984).
Waiver of Landlord’s Breach.
Tenants’ storage of some furniture and boxes in apartment did not constitute an intentional election to waive landlord’s breach of his duty to make the apartment habitable. Mitchell v. Preusse, 358 N.W.2d 511, 1984 N.D. LEXIS 418 (N.D. 1984).
DECISIONS UNDER PRIOR LAW
“Intended for Occupation by Humans.”
The cellar and first story of a building in a business block did not constitute a building intended for the occupation of human beings within former statute requiring lessor to put such buildings in a condition fit for human occupation and to keep them in repair unless otherwise agreed. Edmison v. Aslesen, 27 N.W. 82, 4 Dakota 145, 1886 Dakota LEXIS 2 (Dakota 1886).
Collateral References.
Right of recovery for repairs by tenant against stranger wrongfully interfering with his possession, 12 A.L.R.2d 1192, 1210.
Signs: repair and maintenance of advertising signs on leased premises, 20 A.L.R.2d 940, 950.
Tenant’s right to make repairs or rebuild at landlord’s cost, where landlord has covenanted to repair, 28 A.L.R.2d 446.
Fire, duty of landlord under express covenant to repair, rebuild, or restore, where property is damaged or destroyed by, 38 A.L.R.2d 682.
Covenant for quiet enjoyment, landlord’s entry to make repairs as breach of, 41 A.L.R.2d 1414, 1454.
Public authorities: who, as between landlord and tenant, must make or bear expense of alterations, improvements or repairs ordered by public authorities, 22 A.L.R.3d 521.
Habitability: modern status of rules as to existence of implied warranty of habitability of fitness for use of leased premises, 40 A.L.R.3d 646.
Aggravated negligence or similar fault, landlord’s failure to repair as, 40 A.L.R.3d 795.
Set-off against rent: tenant’s right, where landlord fails to make repairs, to have them made and set-off cost against rent, 40 A.L.R.3d 1369.
Strict liability of landlord for injury or death of tenant or third person caused by defect in premises leased for residential use, 48 A.L.R.4th 638.
Violation of statute or ordinance requiring landlord to furnish specified facilities or services as ground of liability for injury resulting from tenant’s attempt to deal with deficiency, 63 A.L.R.4th 883.
Landlord’s liability for injury or death of tenant’s child from lead paint poisoning, 19 A.L.R.5th 405.
Landlord’s liability for failure to protect tenant from criminal acts of third person, 43 A.L.R.5th 207.
Landlord’s liability to third party for repairs authorized by tenant, 46 A.L.R.5th 1.
Apportionment of liability between landowners and assailants for injuries to crime victims, 54 A.L.R.5th 379.
Liability of owner or operator of self-service filling station for injury or death of patron, 60 A.L.R.5th 379.
Liability of landlord for injury or death occasioned by swimming pool maintained for tenants, 62 A.L.R.5th 475.
Law Reviews.
For Article: Landlord Weapon or Tenant Shield? A Proposal to Reform North Dakota’s Residential Security Deposit Statute, see 85 N.D. L. Rev. 251 (2009).
47-16-13.2. Tenant obligations — Maintenance of dwelling unit.
A tenant of a residential dwelling unit shall:
- Comply with all obligations primarily imposed upon tenants by applicable provisions of building and housing codes materially affecting health and safety.
- Keep that part of the premises that the tenant occupies and uses as clean and safe as the condition of the premises permit.
- Periodically remove all ashes, garbage, rubbish, and other waste from the tenant’s dwelling unit, and dispose of them in a clean and safe manner.
- Keep all plumbing fixtures in the dwelling unit or used by the tenant as clean as their condition permits.
- Use in a reasonable manner all electrical, plumbing, sanitary, heating, ventilating, air-conditioning, and other facilities and appliances including elevators in the premises.
- Not deliberately or negligently destroy, deface, damage, impair, or remove any part of the premises or knowingly permit any person to do so.
- Conduct oneself and require other persons on the premises with the tenant’s consent to conduct themselves in a manner that will not disturb the tenant’s neighbors’ peaceful enjoyment of the premises.
Source:
S.L. 1977, ch. 429, § 2.
Cross-References.
Lessee of realty to use ordinary care, see N.D.C.C. § 47-16-09.
Notes to Decisions
- Fire Caused by Cigarette.
- Limited Obligation to Invitees and Landlord.
- Responsibility for Conduct of Third Persons.
Fire Caused by Cigarette.
In an action brought by apartment owner against tenant for damages caused by a fire, where owner failed to present probative evidence which would have allowed the jury to determine that tenant had exclusive control of the cigarette which allegedly was the instrumentality which caused the fire, so that the jury was left to speculate as to which of three persons had been in control of the offending instrumentality, it was error to instruct the jury on res ipsa loquitur. Victory Park Apartments v. Axelson, 367 N.W.2d 155, 1985 N.D. LEXIS 306 (N.D. 1985).
Limited Obligation to Invitees and Landlord.
The trial court did not err in concluding that tenant had no duty as a tenant of only part of the building, beyond a duty to warn its invitees and notify the landlord about dangers in the entries and hallways. Jacobs v. Anderson Bldg. Co., 459 N.W.2d 384, 1990 N.D. LEXIS 150 (N.D. 1990).
Responsibility for Conduct of Third Persons.
This section imposes responsibility on tenants for conduct of third persons only where the tenant has actual knowledge or is aware of the wrongful conduct. Victory Park Apartments v. Axelson, 367 N.W.2d 155, 1985 N.D. LEXIS 306 (N.D. 1985).
This section requires that the tenant, in addition to having knowledge or being aware of the wrongful conduct of a third person, must have consented to, allowed, authorized or otherwise acquiesced in such conduct. Victory Park Apartments v. Axelson, 367 N.W.2d 155, 1985 N.D. LEXIS 306 (N.D. 1985).
Collateral References.
Liability of tenant for damages to leased property due to his acts or neglect, 10 A.L.R.2d 1012.
Public authorities: who, as between landlord and tenant, must make or bear expense of alterations, improvements or repairs ordered by public authorities, 22 A.L.R.3d 521.
47-16-13.3. Unconscionability.
-
If a court of competent jurisdiction, as a matter of law, finds:
- A residential dwelling unit rental agreement or any provision thereof was unconscionable when made, the court may refuse to enforce the agreement, enforce the remainder of the agreement without the unconscionable provision, or limit the application of any unconscionable provision to avoid an unconscionable result.
- A settlement in which a party waives or agrees to forego a claim or right under sections 47-16-13.1 through 47-16-13.6 or under a rental agreement was unconscionable when made, the court may refuse to enforce the settlement, enforce the remainder of the settlement without the unconscionable provision, or limit the application of any unconscionable provision to avoid an unconscionable result.
- If unconscionability is put into issue by a party or by the court upon its own motion, the parties shall be afforded a reasonable opportunity to present evidence as to the setting, purpose, and effect of the rental agreement or settlement to aid the court in making the determination.
Source:
S.L. 1977, ch. 429, § 3.
Collateral References.
Promotional literature: statements in promotional or explanatory literature issued by lessor to lessee as ground for relief from contract, 43 A.L.R.3d 1386.
47-16-13.4. Remedy after termination.
If the rental agreement is terminated, the landlord has a claim for possession and for rent and a separate claim for actual damages for breach of the rental agreement.
Source:
S.L. 1977, ch. 429, § 4.
Notes to Decisions
Landlord’s Loss of Ownership As Damages.
Where tenant under a commercial lease failed to pay rent due to a dispute over repairs and landlord lost building to foreclosure, trial court did not err in awarding damages to landlord for loss of enjoyment of ownership of building and loss of potential market value. B.W.S. B.W.S. Inv. v. Mid-Am Restaurants, 459 N.W.2d 759, 1990 N.D. LEXIS 160 (N.D. 1990).
Collateral References.
Liquidated sum for failure to vacate premises or surrender possession at expiration of lease, validity and construction of lease provision requiring lessee to pay, 23 A.L.R.2d 1318.
Advance rental payments made under lease terms, right of lessor to retain upon lessee’s default in rent, 27 A.L.R.2d 656.
Measure of damages for tenant’s failure to surrender possession, 32 A.L.R.2d 582, 611.
Forcible detainer or similar possessory action, right of landlord who has conveyed property to third person to maintain, 47 A.L.R.2d 1170.
Executor or administrator, power to recover rent under existing lease, 95 A.L.R.2d 277.
Dispossess tenant without legal process, right of landlord legally entitled to possession to, 6 A.L.R.3d 177.
47-16-13.5. Mitigation of damages.
Any party aggrieved under sections 47-16-13.1 through 47-16-13.6 may recover appropriate damages. However, the aggrieved party has a duty to mitigate damages.
Source:
S.L. 1977, ch. 429, § 5.
Collateral References.
Landlord’s duty, on tenant’s failure to occupy, or abandonment of, premises, to mitigate damages by accepting or procuring another tenant, 75 A.L.R.5th 1.
47-16-13.6. Enforcement of sections 47-16-13.1 through 47-16-13.6.
Any right or action provided by sections 47-16-13.1 through 47-16-13.6 is enforceable by action and the court may award reasonable attorney’s fees to the prevailing party.
Source:
S.L. 1977, ch. 429, § 6.
Collateral References.
Lease provision relating to attorneys’ fees, construction and effect of, 77 A.L.R.2d 735.
Amount of attorneys’ compensation in matters involving real estate, 58 A.L.R.3d 1336.
Notes to Decisions
Attorneys' Fees.
District court abused its discretion in denying a lessor reasonable attorneys' fees as the prevailing party based on the terms of the lease because the district court did not treat the eviction as a summary proceeding; by extending the proceedings to allow for supplemental briefing and further motion, the district court should have addressed the legal issues raised in the post-hearing motion for attorneys' fees. Cheetah Props. 1, LLC v. Panther Pressure Testers, Inc., 2016 ND 102, 879 N.W.2d 423, 2016 N.D. LEXIS 98 (N.D. 2016).
47-16-13.7. Eviction — Lessee liable for rent during term of lease.
A lessee evicted according to law is liable for rent during the remainder of the term of the lease. However, this section does not relieve the landlord of the duty to mitigate damages.
Source:
S.L. 1993, ch. 319, § 2.
47-16-14. When a lease of real property terminates.
The leasing of real property terminates:
- At the end of the term agreed upon;
- By the mutual consent of the parties;
- By the lessee’s acquiring title to the property leased superior to that of the lessor; or
- By the destruction of the property leased.
Source:
Civ. C. 1877, § 1111; R.C. 1895, § 4077; R.C. 1899, § 4077; R.C. 1905, § 5524; C.L. 1913, § 6087; R.C. 1943, § 47-1614.
Derivation:
Cal. Civ. C., 1933.
Notes to Decisions
Expiration of Term.
A lease is terminated by the expiration of the term of the tenancy as fixed by the lease without notice to either party. Wilson v. Divide County, 76 N.W.2d 896, 1956 N.D. LEXIS 121 (N.D. 1956).
Intent to Surrender Premises.
That business for which the premises had been leased had been terminated, that lessee’s fixtures had all been sold to other parties, that on the date he left the keys to the premises in the cash register drawer, the lessee had no other property in the store, and that lessee had no further use for the premises, all persuasively indicate that lessee intended to surrender the leased premises. Sanden v. Hanson, 201 N.W.2d 404, 1972 N.D. LEXIS 109 (N.D. 1972).
When the tenants had fully performed their obligations and accepted the benefits under an unsigned written termination agreement, their actions were equally consistent with voluntary surrender of the leased premises and with mitigating their damages for the landlord’s alleged breach of the lease, and summary judgment for the landlord was improper. Pierce v. B.P.O. of Elks Lodge No. 1214, 2004 ND 26, 673 N.W.2d 914, 2004 N.D. LEXIS 36 (N.D. 2004).
Mutual Consent.
Mutual consent of the parties may be express or implied from the conduct of the parties. A lease may be terminated or surrendered either by express agreement or by operation of law, whereby the surrender results from acts of the parties to the lease which imply mutual consent to the termination. Sanden v. Hanson, 201 N.W.2d 404, 1972 N.D. LEXIS 109 (N.D. 1972).
Purchase by Lessee.
Although lessors may have invalidly granted an easement in gross to the United States during the term of the lease, the rights of the lessees under the lease terminated by their purchase of the property and their title is subject to the easement granted by the prior owners. United States v. Albrecht, 496 F.2d 906, 1974 U.S. App. LEXIS 8747 (8th Cir. N.D. 1974).
Collateral References.
Lease giving landlord percentage of lessee’s profits or receipts, termination, 38 A.L.R.2d 1113, 1117.
Condition of premises within contemplation of provision of lease or statute for termination of lease in event of destruction of or damage to property as result of fire, calamity, the elements, act of God, or the like, 61 A.L.R.2d 1445.
Fire: condition of premises within contemplation of provision of lease or statute for termination of lease in event of destruction of, or damage to, property as result of fire, 61 A.L.R.2d 1445.
Calculation of rental under commercial percentage lease, 58 A.L.R.3d 384.
47-16-15. Notice of termination of lease.
- A lease of real property for a term not specified by the parties is deemed to be renewed as stated in section 47-16-06 at the end of the term implied by law, unless one of the parties gives notice to the other of an intention to terminate the lease, at least as long before the expiration of the lease as the term of the hiring itself, not exceeding one calendar month.
- In tenancies from month to month, and unless the parties have otherwise agreed in writing to a longer notice period or a different notice time, either party may terminate the tenancy by giving at least one calendar month’s written notice at any time. The rent is due and payable to and including the date of termination.
- If a landlord changes the terms of the lease pursuant to section 47-16-07, the tenant may terminate the lease at the end of the month by giving at least twenty-five days’ notice.
- Any agreement that requires a lessee to give notice that exceeds one month from the end of a month to terminate a lease of real property for residential purposes must state the notice requirement and provide space for the lessee to initial next to the notice requirement. If the notice is not initialed by the lessee at the time of executing the lease, the lessee may terminate the lease on the last day of a month with at least one calendar month’s notice.
- If a lease converts to a month-to-month tenancy under section 47-16-06 or 47-16-06.1, either party may terminate the lease on the last day of a month with at least one calendar month’s notice.
Source:
Civ. C. 1877, § 1119; R.C. 1895, § 4085; R.C. 1899, § 4085; R.C. 1905, § 5532; C.L. 1913, § 6095; R.C. 1943, § 47-1615; S.L. 1963, ch. 318, § 1; 1979, ch. 486, § 2; 1985, ch. 507, § 2; 2007, ch. 399, § 2.
Derivation:
Cal. Civ. C., 1946.
Notes to Decisions
Federally Subsidized Housing.
Although either party to a lease of real estate property can normally terminate a month-to-month tenancy with proper notice under this section, federal regulations place additional burdens on owners of subsidized projects. Community Homes v. Quast, 510 N.W.2d 648, 1994 N.D. LEXIS 19 (N.D. 1994).
Written Notice Required.
Written notice to terminate is required whether the lease is oral, or written. United Accounts v. Teladvantage, 499 N.W.2d 115, 1993 N.D. LEXIS 76 (N.D. 1993).
Because tenants did not provide their landlord with sufficient written notice of their intent to terminate the lease as required under N.D.C.C. § 47-16-15(2), the trial court did not err in concluding the landlord's withholding of the security deposit was legally permissible and reasonably justified as a matter of law. Chegwidden v. Evenson, 2015 ND 131, 863 N.W.2d 843, 2015 N.D. LEXIS 131 (N.D. 2015).
Collateral References.
Inclusion or exclusion of first and last days in computing time for giving notice of termination of lease which must be given a certain number of days before a known future date, 98 A.L.R.2d 1331.
Sublessee’s rights with respect to primary lessee’s option to renew lease, 39 A.L.R.4th 824.
47-16-16. When lessor may terminate lease.
The lessor of real property may terminate the lease and reclaim such property before the end of the term agreed upon when the lessee:
- Uses or permits a use of the property leased in a manner contrary to the agreement of the parties; or
- Does not make such repairs as the lessee is bound to make within a reasonable time after a request is made.
Source:
Civ. C. 1877, § 1109; R.C. 1895, § 4075; R.C. 1899, § 4075; R.C. 1905, § 5522; C.L. 1913, § 6085; R.C. 1943, § 47-1616.
Derivation:
Cal. Civ. C., 1931.
47-16-17. When lessee may terminate lease.
The lessee of real property may terminate the lease before the end of the term agreed upon:
- When the lessor does not fulfill the lessor’s obligations, if any, within a reasonable time after request, as to placing and securing the lessee in the quiet possession of the property leased, or putting it into a good condition, or repairing it; or
- When the greater part of the property leased, or that part which was, and which the lessor had reason to believe was, the material inducement to the lessee to enter into the contract, perishes from any cause other than the ordinary negligence of the lessee.
Source:
Civ. C. 1877, § 1110; R.C. 1895, § 4076; R.C. 1899, § 4076; R.C. 1905, § 5523; C.L. 1913, § 6086; R.C. 1943, § 47-1617; S.L. 1983, ch. 82, § 91; 1985, ch. 82, § 117.
Derivation:
Cal. Civ. C., 1932.
Notes to Decisions
Failure to Make Repairs.
Commercial landlord’s failure to repair leaking roof and malfunctioning air conditioning unit in a store after repeated demands from the tenant left the premises unfit for occupancy for the purposes for which they were intended and constituted a constructive eviction justifying the tenant’s vacating the premises. CAP Partners v. Cameron, 1999 ND 178, 599 N.W.2d 309, 1999 N.D. LEXIS 198 (N.D. 1999).
Notice.
Where lessee provided lessor with written notice of his intent to terminate the lease and vacate the premises two months prior to vacating and also made several verbal complaints regarding the property in person and by telephone, this was sufficient evidence to support the trial court’s finding that the lessor received notice under this section. Pfeifle v. Tanabe, 2000 ND 219, 620 N.W.2d 167, 2000 N.D. LEXIS 269 (N.D. 2000).
47-16-17.1. Termination due to domestic abuse.
- A tenant to a residential lease who is a victim of domestic violence as defined in section 14-07.1-01 or fears imminent domestic violence against the tenant or the tenant’s minor children if the tenant or the tenant’s minor children remain in the leased premises may terminate a lease agreement, as provided in this section, without penalty or liability.
-
The tenant must provide advance written notice to the landlord stating:
- The tenant fears imminent domestic violence from a person named in a court order, protection order under section 14-07.1-02, ex parte temporary protection order, order prohibiting contact, restraining order, or other record filed with a court;
- The tenant needs to terminate the tenancy; and
- The specific date the tenancy will terminate.
- The notice must be delivered by mail, facsimile communication, or in person before the termination of the tenancy.
- A landlord may not disclose information provided to the landlord by a tenant documenting domestic violence under this section. The information may not be entered into any shared database or provided to any person, but may be used as evidence in an eviction proceeding, in a claim for unpaid rent or damages arising out of the tenancy, or as otherwise required by law.
- A tenant terminating a lease under this section is responsible for the rent payment for the full month in which the tenancy terminates and an additional amount equal to one month’s rent, subject to the landlord’s duty to mitigate. The tenant is relieved of any other contractual obligation for payment of rent or any other charges for the remaining term of the lease, except as provided in this section.
- This section does not affect a tenant’s liability for delinquent, unpaid rent, or other amounts owed to the landlord before the lease was terminated by the tenant under this section.
- The tenancy terminates, including the right of possession of the premises, on the termination date stated in the notice under subsection 2. The amount equal to one month’s rent must be paid on or before the termination of the tenancy for the tenant to be relieved of the contractual obligations for the remaining term of the lease as provided in this section.
-
For purposes of this section, timing for the payment of the lessee’s security deposit under section 47-16-07.1 is triggered by either of the following:
- If the only tenant, including the tenant’s minor children, is the tenant who is the victim of domestic violence, upon the first day of the month following the date the tenant vacates the premises.
- If there are additional tenants bound by the lease, upon the expiration of the lease.
- Notwithstanding the release of a tenant from a lease agreement under this section, the tenancy continues for any remaining tenants.
- A person may not refuse to rent, refuse to negotiate for the rental of, or in any other manner make unavailable or deny a dwelling to an individual, or otherwise retaliate in the rental of a dwelling solely because a tenant or applicant or a household member of the tenant or applicant exercised the right to terminate a lease under this section.
- In an action for a violation of this section, the court may award statutory damages of one thousand dollars. The court also may award actual damages, reasonable attorney’s fees, costs, and disbursements.
Source:
S.L. 2009, ch. 394, § 1; 2011, ch. 340, § 1; 2015, ch. 122, § 2, eff August 1, 2015.
Effective Date.
The 2015 amendment of this section by section 2 of chapter 122, S.L. 2015 became effective August 1, 2015.
47-16-18. When lease of real property is terminated by death.
Only a lease of real property which is terminable at the pleasure of one of the parties to the contract is terminated by the notice to one party of the death or incapacity of the other party to contract. Upon the death of a lessee of real property for residential purposes, however, and at the option of any surviving lessee or of the estate of the decedent, the lease terminates on the last day of the month in the month following the death of the lessee unless the lease term expires before that time.
Source:
Civ. C. 1877, § 1112; R.C. 1895, § 4078; R.C. 1899, § 4078; R.C. 1905, § 5525; C.L. 1913, § 6088; R.C. 1943, § 47-1618; S.L. 2009, ch. 395, § 1.
Derivation:
Cal. Civ. C., 1934.
Collateral References.
Death of lessee as terminating lease, 42 A.L.R.4th 963.
47-16-19. Term of lease governed by manner of payment of rent.
The renting of lodgings for an unspecified term is presumed to have been made for such length of time as the parties adopt for the estimation of the rent. Thus renting at a weekly rate of rent is presumed to be for one week. In the absence of any agreement respecting the length of time of the rent, the leasing is presumed to be monthly.
Source:
Civ. C. 1877, § 1117; R.C. 1895, § 4083; R.C. 1899, § 4083; R.C. 1905, § 5530; C.L. 1913, § 6093; R.C. 1943, § 47-1619.
Derivation:
Cal. Civ. C., 1944.
47-16-20. Rents — When payable.
When there is no contract or usage to the contrary, the rent of agricultural and wild land shall be payable yearly at the end of each year. Rents of lodgings shall be payable monthly at the end of each month. Other rents shall be payable quarterly at the end of each quarter from the time the lease takes effect. The rent for a lease shorter than the periods herein specified shall be payable at the termination of the lease.
Source:
Civ. C. 1877, § 1120; R.C. 1895, § 4086; R.C. 1899, § 4086; R.C. 1905, § 5533; C.L. 1913, § 6096; R.C. 1943, § 47-1620.
Derivation:
Cal. Civ. C., 1947.
Collateral References.
Time for payment of rentals under lease giving landlord percentage of lessee’s profits or receipts, 38 A.L.R.2d 1113, 1117.
Calculation of rental under commercial percentage lease, 58 A.L.R.3d 384.
47-16-21. When proportionate part of lease paid by lessee.
When the leasing of real property is terminated before the time originally agreed upon, the lessee must pay the due proportion of the lease for such use as the lessee actually has made of the property unless such use is merely nominal and of no benefit to the lessee.
Source:
Civ. C. 1877, § 1113; R.C. 1895, § 4079; R.C. 1899, § 4079; R.C. 1905, § 5526; C.L. 1913, § 6089; R.C. 1943, § 47-1621.
Derivation:
Cal. Civ. C., 1935.
Notes to Decisions
Rent Obligation.
As a tenant of commercial property, tenant had duty to pay rent until it exercised its right to terminate lease by vacating property, based on failure of landlord to make repairs. Peterson v. Front Page, Inc., 462 N.W.2d 157, 1990 N.D. LEXIS 226 (N.D. 1990).
47-16-22. Rent due upon lease for life — Recovery.
Rent due upon a lease for life may be recovered in the same manner as upon a lease for years.
Source:
Civ. C. 1877, § 262; R.C. 1895, § 3369; R.C. 1899, § 3369; R.C. 1905, § 4805; C.L. 1913, § 5348; R.C. 1943, § 47-1622.
Derivation:
Cal. Civ. C., 824.
47-16-23. Rent dependent on life of person — Collection after death.
Rent dependent on the life of a person may be recovered after as well as before that person’s death.
Source:
Civ. C. 1877, § 263; R.C. 1895, § 3370; R.C. 1899, § 3370; R.C. 1905, § 4806; C.L. 1913, § 5349; R.C. 1943, § 47-1623.
Derivation:
Cal. Civ. C., 825.
47-16-24. Lessee must give written notice before removal of property from premises. [Repealed]
Repealed by S.L. 1975, ch. 106, § 673.
47-16-25. Notice of adverse proceedings to landlord.
Every tenant who receives notice of any proceeding to recover the real property occupied by the tenant, or the possession thereof, must:
- Inform the tenant’s landlord immediately of the notice; and
- Deliver the notice to the landlord.
The tenant shall be responsible to the landlord for all damages which the landlord may sustain by reason of any omission by the tenant to inform the landlord of the notice or to deliver it to the landlord, if such notice is in writing. The attornment to a stranger is void unless made with the consent of the landlord or in consequence of a judgment of a court of competent jurisdiction.
Source:
Civ. C. 1877, § 1121; R.C. 1895, § 4087; R.C. 1899, § 4087; R.C. 1905, § 5534; C.L. 1913, § 6097; R.C. 1943, § 47-1625.
Derivation:
Cal. Civ. C., 1948, 1949.
Notes to Decisions
Attornment to Owner of Superior Title.
As between the landlord and tenant, a subsequent lease between the tenant and the owner of a superior title is void unless made with consent of the landlord or after judgment against the landlord. Yeam v. Dempsey, 55 N.D. 259, 212 N.W. 852, 1927 N.D. LEXIS 32 (N.D. 1927).
Duty of Tenant.
Under this section, it is the duty of a tenant who desires to improve his possessory right to first surrender possession to his lessor. Yeam v. Dempsey, 55 N.D. 259, 212 N.W. 852, 1927 N.D. LEXIS 32 (N.D. 1927).
Where a tenant surrendered possession of land to the landlord and then reentered under color of title from a different source, his possession was not as tenant of the record owner and he owed no duty to the record owner to inform him of proceedings to forfeit the record owner’s title to the land. Wilson v. Divide County, 76 N.W.2d 896, 1956 N.D. LEXIS 121 (N.D. 1956).
Notice to Contract Holder of Public Lands.
The tenant of the holder of a contract for public lands receiving notice intended to affect the immediate possession and ownership of crops must give the landlord notice. Yeam v. Dempsey, 55 N.D. 259, 212 N.W. 852, 1927 N.D. LEXIS 32 (N.D. 1927).
47-16-26. Double letting of room prohibited.
One who rents part of a room for a dwelling is entitled to the whole of the room, notwithstanding any agreement to the contrary. If a landlord rents a room as a dwelling for more than one family, the person to whom the landlord first rents any part of it is entitled to the possession of the whole room for the term agreed upon. Every tenant in the building under the same landlord is relieved from all obligation to pay rent to the landlord while such double letting of any room continues.
Source:
Civ. C. 1877, § 1122; R.C. 1895, § 4088; R.C. 1899, § 4088; R.C. 1905, § 5535; C.L. 1913, § 6098; R.C. 1943, § 47-1626.
Derivation:
Cal. Civ. C., 1950.
47-16-27. Right of tenant.
A tenant for years or at will, unless the tenant is a wrongdoer by holding over, may:
- Occupy the buildings.
- Take the annual products of the soil.
- Work mines and quarries open at the commencement of the tenant’s tenancy.
- Cultivate and harvest the crops growing at the end of the tenant’s tenancy.
The tenant has no rights to the property other than such as are given the tenant by the agreement or instrument by which the tenant’s tenancy is acquired or by the provisions of this section.
Source:
Civ. C. 1877, §§ 257, 258; R.C. 1895, §§ 3364, 3365; R.C. 1899, §§ 3364, 3365; R.C. 1905, §§ 4800, 4801; C.L. 1913, §§ 5343, 5344; R.C. 1943, § 47-1627.
Derivation:
Cal. Civ. C., 819, 820.
Cross-References.
Mineral leases, specification of minerals to be leased, see N.D.C.C. § 47-10-24.
Products during lease belong to lessee, see N.D.C.C. § 47-16-04.
Notes to Decisions
Doctrine of Emblements.
The fundamental purpose of the doctrine of emblements is to assure the tenant compensation for his labor, and thus encourage husbandry as a matter of public policy. Rosenstein v. Williams County, 73 N.D. 363, 15 N.W.2d 378, 1944 N.D. LEXIS 71 (N.D. 1944).
This section supersedes the common law doctrine of emblements. Hamilton v. Winter, 281 N.W.2d 54, 1979 N.D. LEXIS 266 (N.D. 1979).
Leases of Fixed Duration.
This section applies only to leases of uncertain duration, not to leases of fixed terms. Hamilton v. Winter, 281 N.W.2d 54, 1979 N.D. LEXIS 266 (N.D. 1979).
Transfer Rights.
Assuming that bankruptcy debtors, who were general partners in a partnership, had a right to occupy the partnership’s property as tenants at will, such an occupancy right did not bestow the debtors with the rights to transfer the partnership property into their own names, and the debtors did not have any other legal or equitable claim or right to the property. Hoggarth Bros. v. Sec. State Bank of N.D. (In re Hoggarth Bros.), 2004 U.S. Dist. LEXIS 7198 (D.N.D. Apr. 22, 2004).
47-16-28. Succession to rights in real property or rent transfers.
A person to whom any real property is transferred or devised upon which rent has been reserved, or to whom any such rent is transferred, is entitled to the same remedies for recovery of rent, for nonperformance of any of the terms of the lease or for any waste or cause of forfeiture as that person’s grantor or devisor might have had.
Source:
Civ. C. 1877, § 259; R.C. 1895, § 3366; R.C. 1899, § 3366; R.C. 1905, § 4802; C.L. 1913, § 5345; R.C. 1943, § 47-1628.
Derivation:
Cal. Civ. C., 821.
Notes to Decisions
Covenants.
A covenant in a lease that the lessees would save and hold the lessor harmless from losses arising out of the destruction of property on the leased premises passed to the assignee of the lessor and the assignee was entitled to recover thereon. Northern Pac. Ry. v. McClure, 9 N.D. 73, 81 N.W. 52, 1899 N.D. LEXIS 109 (N.D. 1899).
Cropping Contract.
A grantee of land which was conveyed to him without a reservation of crops is entitled to recover the money due to the owner under the contract made between his grantor and the cropper who was in possession of the land at the time of the conveyance. Martin v. Royer, 19 N.D. 504, 125 N.W. 1027, 1910 N.D. LEXIS 39 (N.D. 1910).
Notice of Prior Transfer of Rights.
Where the lessor’s grantee knew at the time of the grant that the grantor had transferred all his rights under a lease to another, the grantee could not claim any rights under this section. Vincent v. Reynolds Farmers Elevator Co., 53 N.D. 749, 208 N.W. 158, 1926 N.D. LEXIS 31 (N.D. 1926).
Collateral References.
Liability of lessee who assigns lease for rent accruing subsequently to extension or renewal of term, 10 A.L.R.3d 818.
47-16-29. Remedies against assignees of lessor.
Whatever remedies the lessee of any real property may have against the lessee’s immediate lessor for the breach of any agreement in the lease, the lessee may have against the assigns of the lessor. The assigns of the lessee may have remedies against the lessor and the lessor’s assigns except upon covenants against encumbrances or relating to the title or possession of the premises.
Source:
Civ. C. 1877, § 260; R.C. 1895, § 3367; R.C. 1899, § 3367; R.C. 1905, § 4803; C.L. 1913, § 5346; R.C. 1943, § 47-1629.
Derivation:
Cal. Civ. C., 822, 823.
Collateral References.
Sublessee’s rights with respect to primary lessee’s option to renew lease, 39 A.L.R.4th 824.
47-16-30. Remedies against assignees of lessee.
Whatever remedies the lessor of any real property has against the lessor’s immediate lessee for the breach of an agreement in the lease or for recovery of the possession, the lessor also has against the assignees of the lessee for any claim for relief accruing while they are such assignees, except when the assignment is made by way of security for a loan and is not accompanied by possession of the premises.
Source:
Civ. C. 1877, § 260; R.C. 1895, § 3367; R.C. 1899, § 3367; R.C. 1905, § 4803; C.L. 1913, § 5346; R.C. 1943, § 47-1630; S.L. 1985, ch. 82, § 118.
Derivation:
Cal. Civ. C., 822, 823.
Collateral References.
Sublessee’s obligation to sublessor to perform latter’s covenants in original lease, 24 A.L.R.2d 707.
Relative rights and liabilities of landlord, tenant, assignee, or sublessee where act is done increasing insurance rates, 30 A.L.R.2d 489.
Effect of assignment or sublease on obligations of lessee under provision for landlord’s receipt of percentage of lessee’s profits or receipts, 38 A.L.R.2d 1113, 1117.
Calculation of rental under commercial percentage lease, 58 A.L.R.3d 384.
Sublessee’s rights with respect to primary lessee’s option to renew lease, 39 A.L.R.4th 824.
Merger or consolidation of corporate lessee as breach of clause in lease prohibiting, conditioning, or restricting assignment or sublease, 39 A.L.R.4th 879.
47-16-30.1. Abandoned property — Disposal by lessor.
Property with a total estimated value of not more than two thousand five hundred dollars which is left on the premises of a leased dwelling may be retained by the lessor and disposed of without legal process twenty-eight or more days after the lessor received actual notice that the lessee has vacated the premises or twenty-eight or more days after it reasonably appears to the lessor that the lessee has vacated the premises. The lessor is entitled to the proceeds from the sale of the property. The lessor may recover, from the lessee’s security deposit, any storage and moving expenses in excess of the proceeds from the sale incurred in disposing of the property. If the lessor removes the abandoned property from the dwelling unit after a judgment of eviction has been obtained and the special execution has been served, the lessor has a lien upon the property for the reasonable amount of any storage and moving expenses and may retain possession of the property until the charges have been paid. The lien does not have priority over a prior perfected security interest in the property.
Source:
S.L. 1983, ch. 506, § 2; 1985, ch. 507, § 3; 1995, ch. 438, § 1; 1997, ch. 390, § 1; 2013, ch. 349, § 1.
Effective Date.
The 2013 amendment of this section by section 1 of chapter 349, S.L. 2013 became effective August 1, 2013.
Notes to Decisions
Forclosure.
Even where a valid lien under the statute exists, a creditor must foreclose on the lien before terminating the tenant's interest in the property; there is no indication in either the statutory language or the legislative history that the lien created in the statute was intended to circumvent all foreclosure proceedings. Poppe v. Stockert, 2015 ND 252, 870 N.W.2d 187, 2015 N.D. LEXIS 256 (N.D. 2015).
Noncompliance.
District court erred in granting a mover and a landlord summary judgment in tenants' conviction action and in allowing them the right to dispose of the tenants' property because the landlord failed to meet the requirements imposed by the statute by not serving a special execution and by disposing of property valued in excess of $ 1,500 without legal process; a special execution was required but the landlord admitted that no special execution was obtained or served on the tenants. Poppe v. Stockert, 2015 ND 252, 870 N.W.2d 187, 2015 N.D. LEXIS 256 (N.D. 2015).
Property Valuation.
Because a landlord and a mover did not dispute the property valuation, which was above the $1,500 statutory maximum, the statute did not apply. Poppe v. Stockert, 2015 ND 252, 870 N.W.2d 187, 2015 N.D. LEXIS 256 (N.D. 2015).
47-16-31. Gas and oil lease cancellation — When owner makes application. [Repealed]
Repealed by S.L. 1953, ch. 277, § 4.
47-16-32. Application for cancellation of gas and oil lease — Contents. [Repealed]
Repealed by S.L. 1953, ch. 277, § 4.
47-16-33. Notice of cancellation issued by recorder upon filing application. [Repealed]
Repealed by S.L. 1953, ch. 277, § 4.
47-16-34. Appearance in district court — Lessee or assignee. [Repealed]
Repealed by S.L. 1953, ch. 277, § 4.
47-16-35. No appearance in district court — Lessee or assignee. [Repealed]
Repealed by S.L. 1953, ch. 277, § 4.
47-16-36. Duty of lessee to have terminated or forfeited lease released — Publication notice — Satisfaction of lease to be recorded — Notice to real property owner — Remedies.
When any oil, gas, or other mineral lease given on real property situated in any county of North Dakota and recorded therein terminates or is forfeited it is the duty of the lessee, the lessee’s successors or assigns, within fifteen days after the date of the termination or forfeiture of any lease, to have the lease surrendered in writing, the surrender to be signed by the party making the same, acknowledged, and placed on record in the county where the leased real property is situated without cost to the owner thereof. If the lessee, the lessee’s successors or assigns, fails or neglects to execute and record the surrender within the time provided for, then the owner of the real property may serve upon the lessee, the lessee’s successors or assigns of record, in person or by registered or certified mail, at the lessee’s last-known address, or if the post-office address is not shown of record then by publication once a week for three consecutive weeks in a newspaper of general circulation in the county where the real property is situated, a notice in writing in substantially the following form:
To : I, the undersigned, owner of the following described land situated in County, North Dakota: (description of land) upon which a lease dated , , was given to notify you that the lease has terminated or become forfeited by breach of the terms thereof, that I elect to declare and do declare the lease forfeited and void and that, unless you do, within twenty days from this date, notify the recorder of the county as provided by law that the lease has not been forfeited, I will file with the recorder a satisfaction of lease as provided by law, and I demand that you execute or have executed a proper surrender of the lease and that you put the same of record in the office of the recorder of the county within twenty days from this date. Dated , .
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The owner of the real property may after twenty days from the date of service, registration, or first publication of the notice, file with the recorder of the county where the real property is situated a satisfaction of lease setting forth that the affiant is the owner of the real property, that the lease has terminated or that the lessee, or the lessee’s successors or assigns, has failed or neglected to comply with the terms of the lease, reciting the facts constituting the failure and that the same has been forfeited and is void, and setting out in satisfaction of lease a copy of the notice served, as above provided and the manner and time of the service thereof. If the lessee, the lessee’s successors or assigns, gives notice in writing within twenty days after service to the recorder of the county where the real property is located that the lease has not been forfeited and that the lessee, the lessee’s successors or assigns, still claim that the lease is in full force and effect, then the satisfaction of lease may not be recorded but the recorders shall notify the owner of the real property of the action of the lessee, the lessee’s successors or assigns, and the owner of the real property is entitled to the remedies now provided by law for the cancellation of the disputed lease. If the lessee, the lessee’s successors or assigns, fails to notify the recorder, as above provided, then the recorder shall record the satisfaction of lease and thereafter the record of the lease is not notice to the public of the existence of the lease or of any interest therein, or rights thereunder, and the record may not be received in evidence in any court of the state on behalf of the lessee, the lessee’s successors or assigns, against the lessor, the lessor’s successors or assigns.
Source:
S.L. 1951, ch. 233, § 1; 1953, ch. 277, § 1; 1955, ch. 290, § 1; R.C. 1943, 1957 Supp., § 47-1636; S.L. 1977, ch. 430, § 1; 1981, ch. 465, § 1; 1999, ch. 51, § 23; 2001, ch. 120, § 1.
Cross-References.
Drilling or mining leases by county, see N.D.C.C. § 11-27-05.
Oil, gas and mineral leases, publicly owned land, see N.D.C.C. chs. 38-09 and 38-11.
Notes to Decisions
- Constitutionality.
- Failure to Respond.
- Lessor’s Right to Invoke Section.
- “Registration”.
- Time to Give Notice.
Constitutionality.
The fact that lessee may have less time to respond when lessor’s notice is sent by mail, since his time to respond is computed from the mailing date and not from the date of receipt, than when given by personal service or publication does not result in a denial of due process where lessee has a reasonable time left to respond after receiving the mailed notice; time to respond was reasonable where after receiving the mailed notice lessee still had eighteen days in which to act. Taurus Corp. v. Roman Yourk Equity Pure Trust, 264 N.W.2d 688, 1978 N.D. LEXIS 224 (N.D. 1978).
Failure to Respond.
Lessee’s failure to respond within twenty days to an owner’s notice of termination does not result in the lessee losing all its property interests in the lease, but results only in the loss of record evidence. Ridl v. EP Operating Ltd. Pshp., 553 N.W.2d 784, 1996 N.D. LEXIS 220 (N.D. 1996).
Lessor’s Right to Invoke Section.
Lessor is not required to obtain a judicial determination that the lease is terminated or forfeited as a prerequisite for proceeding under this section. Taurus Corp. v. Roman Yourk Equity Pure Trust, 264 N.W.2d 688, 1978 N.D. LEXIS 224 (N.D. 1978).
“Registration”.
The word “registration” means the date of mailing of certified or registered mail. Taurus Corp. v. Roman Yourk Equity Pure Trust, 264 N.W.2d 688, 1978 N.D. LEXIS 224 (N.D. 1978).
Time to Give Notice.
The rules on computation of time contained in the North Dakota Rules of Civil Procedure do not apply to this section. Taurus Corp. v. Roman Yourk Equity Pure Trust, 264 N.W.2d 688, 1978 N.D. LEXIS 224 (N.D. 1978).
Lessee has twenty days from the date of personal service, twenty days from the date of mailing of certified or registered mail, or twenty days from the date of first publication of the notice to give his notice to the register of deeds [now recorder] that he disputes the alleged forfeiture of the lease. Taurus Corp. v. Roman Yourk Equity Pure Trust, 264 N.W.2d 688, 1978 N.D. LEXIS 224 (N.D. 1978).
Law Reviews.
Oil and Gas — Leases: The Supreme Court of North Dakota Holds That a Lessee’s Failure to Respond Within Twenty Days to a Notice of Termination of a Lease Does Not Result in Automatic Termination of Interest in the Lease, 74 N.D. L. Rev. 799 (1998).
47-16-37. Action to obtain release — Damages, costs, and attorney’s fees — Attachment.
Should the owner of such lease neglect or refuse to execute a release, then the owner of the leased premises may sue in any court of competent jurisdiction to obtain such release, and may also recover in such action of the lessee, the lessee’s successors or assigns, the sum of one hundred dollars as damages, and all costs, together with a reasonable attorney’s fee for preparing and prosecuting the suit, and may also recover any additional damages that the evidence in the case will warrant. In all such actions, writs of attachment may issue as in other cases.
Source:
S.L. 1951, ch. 233, § 2; R.C. 1943, 1957 Supp., § 47-1637.
Notes to Decisions
Constitutionality.
This section does not violate the equal protection clause of the federal constitution or §§ 21 and 22 of article I of the state constitution by the fact that it allows a trial court to award statutory damages, costs, and reasonable attorney fees to a prevailing lessor and not to a prevailing lessee. Nygaard v. Robinson, 341 N.W.2d 349, 1983 N.D. LEXIS 411 (N.D. 1983).
Appellate Review.
District court, which declared an oil and gas lease terminated, did not err in concluding a lessee failed to timely pay or tender the required sum under the parties’ agreement. Although the parties’ supplemental agreement allowed the lessee to tender the sum by check or draft mailed or delivered to the lessor by the termination date, the check or draft had to be immediately payable and funded on that date, not delayed until some future date, to satisfy the agreement’s requirement that the sum be tendered by the termination date. Beaudoin v. JB Mineral Servs., LLC, 2011 ND 229, 808 N.W.2d 671, 2011 N.D. LEXIS 232 (N.D. 2011).
Law Reviews.
Oil and Gas — Leases: The Supreme Court of North Dakota Holds That a Lessee’s Failure to Respond Within Twenty Days to a Notice of Termination of a Lease Does Not Result in Automatic Termination of Interest in the Lease, 74 N.D. L. Rev. 799 (1998).
47-16-38. Surrender of lease by lessee.
Any oil and gas or mining lease that has been or may hereafter be recorded in the office of the recorder of any county may be discharged and canceled of record by the recording of a certificate of cancellation signed by the lessee or the lessee’s assigns of record, or the lessee’s duly authorized attorney in fact or personal representative, including a foreign executor or administrator, or a corporation or limited liability company by its duly authorized officers or managers surrendering all of the lessee’s right, title, and interest in and to said lease, which certificate shall be acknowledged as prescribed by law.
Source:
S.L. 1951, ch. 233, § 3; 1953, ch. 277, § 2; R.C. 1943, 1957 Supp., § 47-1638; S.L. 1993, ch. 54, § 106; 2001, ch. 120, § 1.
Collateral References.
Abandonment of oil or gas lease by parol declaration, 13 A.L.R.2d 951.
Rights of parties to oil and gas lease or royalty deed after expiration of fixed term where production temporarily ceases, 100 A.L.R.2d 885.
47-16-39. Record of surrender.
The certificate of cancellation mentioned in section 47-16-38 shall be recorded at length and shall be noted on the margin of the record of the lease.
Source:
S.L. 1951, ch. 233, § 4; 1953, ch. 277, § 3; R.C. 1943, 1957 Supp., § 47-1639.
47-16-39.1. Obligation to pay royalties — Breach.
- The obligation arising under an oil and gas lease to pay oil or gas royalties to the mineral owner or the mineral owner’s assignee, to deliver oil or gas to a purchaser to the credit of the mineral owner or the mineral owner’s assignee, or to pay the market value thereof is of the essence in the lease contract, and breach of the obligation may constitute grounds for the cancellation of the lease in cases in which it is determined by the court that the equities of the case require cancellation. If the operator under an oil and gas lease fails to pay oil or gas royalties to the mineral owner or the mineral owner’s assignee within one hundred fifty days after oil or gas produced under the lease is marketed and cancellation of the lease is not sought or if the operator fails to pay oil or gas royalties to an unleased mineral interest owner within one hundred fifty days after oil or gas production is marketed from the unleased mineral interest owner’s mineral interest, the operator thereafter shall pay interest on the unpaid royalties, without the requirement that the mineral owner or the mineral owner’s assignee request the payment of interest, at the rate of eighteen percent per annum until paid. If the aggregate amount is less than fifty dollars, the operator may remit semiannually to a person entitled to royalties the aggregate of six months’ monthly royalties. The district court for the county in which the oil or gas well is located has jurisdiction over any proceeding brought under this section. The prevailing party in any proceeding brought under this section is entitled to recover court costs and reasonable attorney’s fees. This section does not apply if mineral owners or their assignees elect to take their proportionate share of production in kind, in the event of a dispute of title existing that would affect distribution of royalty payments, or if a mineral owner cannot be located after reasonable inquiry by the operator; however, the operator shall make royalty payments to those mineral owners whose title and ownership interest is not in dispute.
- This section does not apply to obligations to pay oil and gas royalties under an oil and gas lease on minerals owned or managed by the board of university and school lands.
Source:
S.L. 1961, ch. 295, § 1; 1981, ch. 466, § 1; 1995, ch. 439, § 1; 2007, ch. 401, § 1; 2009, ch. 314, § 2; 2011, ch. 265, § 6; 2021, ch. 119, § 2, eff August 1, 2021.
Notes to Decisions
In General.
This section was enacted as a means of increasing the bargaining power of landowners in their dealings with major oil companies concerning rights under oil and gas leases. Imperial Oil of North Dakota, Inc. v. Consolidated Crude Oil Co., 851 F.2d 206, 1988 U.S. App. LEXIS 8954 (8th Cir. N.D. 1988).
N.D.C.C. § 47-16-39.1 suggested that the possibility of future royalties was, or at least might be in a given case, an important component of the oil and gas lease; the relative importance of the royalty clause to the landowners could not be ascertained from the written document. Ir. Oil & Gas, Inc. v. Riemer, 2011 ND 22, 794 N.W.2d 715, 2011 N.D. LEXIS 36 (N.D. 2011).
District court erred in granting summary judgment to an oil and gas company in the trustees' action for an accounting and all unpaid revenue because the court did not determine the validity of the trust's claim in the 1/8% royalty interest in the property and concluded that the company was not the proper party; however if the trust had a valid interest in the property, the company was a proper party from which to recover the underpayment, the company could not rely solely on its division order, to which the trust was not a party, to protect itself from liability without first proving its accuracy, and a determination of the “dispute of title exception” was contingent upon a finding as to the accuracy of the company's division order. Maragos v. Newfield Prod. Co., 2017 ND 191, 900 N.W.2d 44, 2017 N.D. LEXIS 192 (N.D. 2017).
Cancellation Not Required.
District court did not abuse its discretion in refusing to declare a cancellation of an oil and gas lease for lessee’s failure to make royalty payments where there was a legitimate dispute between the lessee and lessor as to amount of royalty payments, and subsequent to filing of action by lessor for such payments, lessor accepted royalty payments upon terms of lessee subject to lessor’s claim for additional payments based upon his calculation of the amount of royalty payments. West v. Alpar Resources, 298 N.W.2d 484, 1980 N.D. LEXIS 339 (N.D. 1980).
Legislative Intent.
This section represents a judgment by the North Dakota legislature that traditional damage remedies are simply inadequate to protect mineral owners’ royalty interests. The legislature has supplanted common law equity with its own weighing of equitable principles and has determined that the nonpayment of royalties may be grounds for cancellation of a mineral lease. Imperial Oil of North Dakota, Inc. v. Consolidated Crude Oil Co., 851 F.2d 206, 1988 U.S. App. LEXIS 8954 (8th Cir. N.D. 1988).
The North Dakota legislature intended to make cancellation available as a remedy for the nonpayment of royalties in appropriate cases even where a damages remedy might be adequate. Imperial Oil of North Dakota, Inc. v. Consolidated Crude Oil Co., 851 F.2d 206, 1988 U.S. App. LEXIS 8954 (8th Cir. N.D. 1988).
Liability.
District court did not err in holding an assignee liable for the pre-bankruptcy confirmation royalties owed to the mineral owners because they did not receive notice of the owner’s bankruptcy proceedings, and the assignee was the entity formed under the reorganization plan and received assignment of the owner’s interest under the relevant oil and gas leases .
Remedy.
Where over a period of several years, defendant simply refused to make royalty payments to plaintiff and the failure to pay was intentional cancellation was the appropriate remedy. Imperial Oil of North Dakota, Inc. v. Consolidated Crude Oil Co., 851 F.2d 206, 1988 U.S. App. LEXIS 8954 (8th Cir. N.D. 1988).
District court did not err in awarding the mineral owners simple interest, rather than compound interest, because, while the mineral owners were the prevailing parties in their action for royalty payments, the plain language of the statute did not specifically require an award of interest to be compounded. Van Sickle v. Hallmark & Assocs., 2013 ND 218, 2013 N.D. LEXIS 224 (Nov. 25, 2013).
Collateral References.
Construction and effect of provision in mineral lease excusing payment of minimum rent or royalty, 28 A.L.R.2d 1013.
Payment of stipulated minimum royalties or annual rental under solid mineral lease as precluding lessor’s claim of forfeiture or abandonment, 87 A.L.R.2d 1076.
47-16-39.2. Inspection of production and royalty payment records — Penalty.
-
A royalty owner, a royalty owner’s assignee, or a designated representative, upon written notice, is entitled to inspect and copy the oil and gas production and royalty payment records for the lease of the person obligated to pay royalties under the lease or division order. The person obligated to pay royalties under the lease shall make that person’s oil and gas royalty payment and production records available for inspection and copying at that person’s usual and customary place of business within the United States. A royalty owner may bring an action to compel the person obligated to pay royalties to allow inspection and copying of oil and gas production royalty payment records. In order for the royalty owner to prevail in such an action, the royalty owner must establish that:
- The royalty owner or the royalty owner’s assignee complied with notice requirements of this section;
- The notice specified the lease involved, the time period under review and the records requested;
- The royalty owner notified the person obligated to pay royalties at the address printed on the information statement as prescribed by rules adopted by the industrial commission pursuant to section 38-08-06.3; and
- The person obligated to pay royalties denied inspection of the records or failed to respond within thirty days of service of notice.
- The district court for the county in which the oil or gas well is located has jurisdiction over all proceedings brought pursuant to this section. If the royalty owner or the royalty owner’s assignee is successful in any proceeding brought pursuant to this section, the district court shall allow the royalty owner or the royalty owner’s assignee to recover court costs; reasonable costs, fees, disbursements, and expenses incurred by the royalty owner or the royalty owner’s assignee or a designated representative in inspecting and copying the oil and gas production and royalty payment records of the person obligated to pay royalties under the lease; and reasonable attorney’s fees.
-
If a royalty owner, a royalty owner’s assignee, or a designated representative is the board of university and school lands:
- The records in subsection 1 must be sent electronically, or in a manner acceptable to the board, to a location designated by the board.
- Notwithstanding subsection 2, at the discretion of the board, a proceeding brought under this section may be brought in the district court of Burleigh County or in the county in which the oil or gas well is located.
-
If the board of university and school lands is successful in any proceeding brought under this section, the district court shall allow the board to recover court costs; reasonable costs, fees, disbursements, and expenses incurred by the board in inspecting the copying the oil and gas production and royalty payment records of the person obligated to pay royalties under the lease; and reasonable attorney’s fees.
- The district court also shall assess a civil penalty of two thousand dollars per day for each day the person obligated to pay royalties under the lease failed to send the oil and gas royalty payment and production records to the board in accordance with subsection 1.
- The civil penalty under subdivision a ceases to accrue on the date the proceedings are initiated under subsection 1.
Source:
S.L. 1987, ch. 553, § 1; 2019, ch. 380, § 1, eff August 1, 2019.
47-16-39.3. Division orders — Definition, function, and operation.
A division order is an instrument executed by the operator, the royalty owners, and any other person having an interest in the production directing the purchaser of oil or gas to pay for the products taken in the proportions set out in the instrument. Royalty payments may not be withheld because an interest owner has not executed a division order. A division order may not alter or amend the terms of the oil and gas lease. A division order that varies the terms of the oil and gas lease is invalid to the extent of the variance and the terms of the oil and gas lease take precedence.
Source:
S.L. 1987, ch. 554, § 1.
47-16-39.4. Resolution of spacing unit ownership interest disputes.
If the mineral owner and mineral developer disagree over the mineral owner’s ownership interest in a spacing unit, the mineral developer shall furnish the mineral owner with a description of the conflict and the proposed resolution or with that portion of the title opinion that concerns the disputed interest.
Source:
S.L. 2013, ch. 280, § 2.
Effective Date.
This section became effective August 1, 2013.
47-16-40. Record of lease as notice for definite term — Extension upon contingency — Affidavit.
When an oil, gas, or mineral lease is hereafter given on land situated within the state of North Dakota, the recording thereof in the office of the recorder of the county in which the land is located shall impart notice to the public of the validity and continuance of said lease for the definite term therein expressed, but no longer. If such lease contains the statement of any contingency upon the happening of which the term of any such lease may be extended, such as, and as much longer as oil and gas or either are produced in paying quantities, the owner of said lease may at any time before the expiration of the definite term of said lease file with said recorder an affidavit setting forth the description of the lease, that the affiant is the owner thereof and the facts showing that the required contingency has happened. This affidavit shall be recorded in full by the recorder, and such record together with that of the lease shall be due notice to the public of the existence and continuing validity of said lease, until the same shall be forfeited, canceled, set aside, or surrendered according to law.
Source:
S.L. 1951, ch. 233, § 5; R.C. 1943, 1957 Supp., § 47-1640; S.L. 2001, ch. 120, § 1.
Notes to Decisions
Bona Fide Purchaser.
In a dispute over an oil and gas lease, it was error for a trial court to grant summary judgment upon concluding, as a matter of law, that an individual was not a bona fide purchaser, due to having constructive notice of another’s claim when recording the lease, because (1) whether the individual had notice was a question of fact, (2) deciding an issue on summary judgment was not appropriate if the court had to draw inferences or make findings on disputed facts, (3) although two corporations argued the facts were not disputed, the corporations did not agree on the inferences that could be drawn from the evidence, (4) more than one inference could reasonably be drawn from the evidence and findings of fact were required, which was not appropriate in a summary judgment proceeding, (5) whether the individual acquired property rights in good faith and for value required findings of fact about the events surrounding a transaction, and (6) a factual dispute existed about whether the individual had constructive notice when the individual acquired rights under the lease. Northern Oil & Gas, Inc. v. Creighton, 2013 ND 73, 830 N.W.2d 556, 2013 N.D. LEXIS 73 (N.D. 2013).
47-16-41. Demand for release before bringing action — Evidence.
At least twenty days before bringing the action provided for in section 47-16-37, the owner of the leased land, either personally or by the owner’s agent or attorney, shall demand of the holder of the lease, if such demand by ordinary diligence can be made in this state, that said lease be released of record. Such demand may be either written or oral. When written, a carbon or written copy thereof, when shown to be such, may be used as evidence in any court with the same force and effect as the original.
Source:
S.L. 1951, ch. 233, § 6; R.C. 1943, 1957 Supp., § 47-1641.
47-16-42. Wind energy leases — Termination. [Renumbered]
Redesignated as section 17-04-05 under S.L. 2007, ch. 204, § 5.
Note.
This section has been redesignated as section 17-04-05 pursuant to S.L. 2007, ch. 204, § 5.