This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2004).
STATE OF MINNESOTA
IN COURT OF APPEALS
Filed January 24, 2006
P. Chinedu Nwaneri, Nwaneri & Associates, P.L.L.C., 2147
University Avenue, Suite 105, St. Paul, MN
55114-1326 (for appellant)
Shanda K. Pearson,
Rider Bennett, L.L.P., 33 South Sixth Street, Suite 4900,
Minneapolis, MN 55402;
D. Himlie, 325 Southdale Place, 3400 West 66th Street, Edina, MN 55435 (for respondent)
Considered and decided by Klaphake, Presiding
Judge, and Crippen, Judge.
P U B L I S H E D O P I N I O N
Appellant Ahmed Demmaj,
the vendee on a cancelled contract for deed, challenges the proof of service of
the notice of cancellation. Because the
record fails to demonstrate a genuine issue of material fact on the occurrence
of service of notice, and there is no merit in the other claims stated on
appeal, we affirm.
In 1992, appellant entered into a
contract for deed with Midway Smorgasbord for the purchase of property located
at 501 Snelling Avenue North
in St. Paul. Eleven years later, appellant defaulted on
the contract by failing to make numerous required payments. Notice of the default was mailed in October
A car log of Ramsey County Deputy
Sheriff Peluso confirms that he found appellant at the 501 Snelling Avenue North site on January
6, 2004, and personally served him with notice of cancellation of the contract.
Peluso also filed an affidavit of
service certifying that he personally served appellant with the notice. Appellant did not cure the default as
required in order to prevent the cancellation.
In April 2004, appellant responded
to an unlawful detainer action by commencing suit for a declaratory judgment
that the contract was not duly cancelled.
The district court’s summary judgment dismissed the suit based on a
determination that appellant defaulted on the contract and was properly served
with notice of cancellation.
D E C I S I O N
On appeal from summary judgment, we
review the record for the purposes of determining whether there are any genuine
issues of material fact and whether the district court erred in applying the law. Offerdahl v. Univ.
of Minn. Hosps. & Clinics, 426 N.W.2d 425, 427 (Minn. 1988). Summary judgment is proper when one party is
entitled to judgment as a matter of law.
R. Civ. P. 56.03.
1. Service of Notice
Appellant maintains that Deputy Peluso did not
serve him with notice on January 6, 2004.
We must take a sheriff’s affidavit of service to be strong evidence of
proper service. Kueffner v. Gottfried, 154 Minn. 70, 73, 191 N.W.
271, 272 (1922). “An officer’s
return cannot be impeached by means of equivocal and evasive affidavits, and,
to set aside and vacate a judgment on the ground that such a return is false,
the proof of its untruthfulness must be positive, satisfactory, and convincing.” Osman v. Wisted, 78 Minn.
295, 297, 80 N.W. 1127, 1127 (1899).
Deputy Peluso testified in his deposition that he
personally served appellant on January 6, 2004.
Contemporaneously with this service, Peluso completed a car log and the
affidavit of service that certified the same facts. Appellant denies that service occurred and
asserts that three months after the date of service Deputy
Peluso admitted to appellant that
he did not recall serving him with the notice of cancellation. But the district court did not err in
determining that appellant’s testimony, without documentation or other confirmation
does not constitute positive and convincing evidence sufficient to overcome the
presumption of validity with regard to the deputy’s affidavit.
Appellant argues that service was
improper and ineffective because Deputy Peluso did not make service at appellant’s
residence. But the statute and rules do
not establish different standards of proof for personal service at a place of
Appellant also argues that Deputy Peluso did not
establish how he knew to find appellant at the property. The letter requesting service incorrectly
identifies the general location of the property. But Peluso’s affidavit and car log indicate
that he found the precise address of the property, and the governing statute
and rule do not require that he show the manner in which he found the person he
personally served. The absence of that
evidence does not significantly weaken the attestation of Peluso at the time
the service occurred.
appellant failed to demonstrate a genuine issue of material fact on the
occurrence of service of notice, the district court did not err when it granted
summary judgment for respondent.
2. Other Issues
Appellant also argues that summary
judgment for respondent was improper because Midway Smorgasbord, the vendor
named in the contract, had been dissolved before the contract was executed and
had no interest in the property. Richard Elasky
was the sole shareholder of Midway, and the contract property was transferred
to him and the corporation dissolved in 1988, several years before the contract
was executed. After the contract was
executed, Midway transferred the vendor’s interest to Elasky’s living trust,
which is now represented by respondent Grace Elasky.
Elasky possessed the fee simple interest in the
property that was the subject of the contract for deed, and it is evident that
Midway Smorgasbord was an alter ego or instrumentality of Richard Elasky. A reviewing court can disregard the corporate
entity when the shareholder “owned all, or substantially all, of the stock,
treated the property as his own, and, most importantly, because no shareholder
or creditor would be adversely affected.”
Roepke v. W. Nat’l. Mut. Ins. Co.,
302 N.W.2d 350, 352 (Minn.
1981). This view of
the transaction fulfills the aim of the law to give effect to the intentions of
the parties as indicated in the contract instrument. See Knudsen
v. Transp. Leasing/Contract, Inc., 672 N.W.2d 221, 223 (Minn. App. 2003)
(noting that when interpreting an unambiguous contract, the plain language is
conclusive of the parties’ intent), review
Feb. 25, 2004).
Significantly, appellant ratified
the contract by means of payments made on the contract for more than ten
years. After Richard Elasky
died, appellant’s payments were made to respondent, his successor in
interest. And appellant’s contacts after
his default confirm his recognition of a lawful contract and respondent’s
ownership of the vendor’s interest.
Finally, there is nothing in the record to indicate that appellant did
not benefit from the possession of the property under the contract. Appellant’s arguments on
appeal conflict with evidence in the record on the intention of the parties at
the time of the contract and thereafter.
Similarly, appellant contends that
the notice of cancellation is ineffective because it came from the
corporation. We are mindful again that
the corporation was not an entity distinguishable in any relevant way from Richard Elasky. Moreover, the purpose of the statutory
cancellation procedure “is to give vendees notice of an impending cancellation
and a reasonable period of time to redeem their interest.” Conley v. Downing,
321 N.W.2d 36, 39 (Minn.
1982). Appellant does not point
to any evidence that he was confused by the cancellation notice. For like reasons, it is not legally
significant that the notice inadvertently spoke of “Midwest”
rather “Midway” Smorgasbord; the incorrect name did not diminish the
sufficiency of notice to appellant.
Appellant also contends that
respondent “forced” appellant to default by failing to return calls to
appellant during the period of redemption following the service of notice of
cancellation. Appellant has not claimed,
and the record does not show, that respondent interfered with appellant’s
attempts at redemption. And appellant
points to no law placing upon the vendor any
obligation of contact or notice to the vendee after the cancellation notice has
been duly served.
appellant contends that respondent waived her right to cancel the contract for
deed when she allowed appellant to cure his default in 2001, thereby violating
a time-is-of-the-essence clause in the contract. But this clause specifically provides that
neither the extension of time for payments nor waiver of the right to declare a forfeiture “shall in any manner affect Seller’s right to
cancel this contract because of defaults subsequently occurring”; the plain
meaning of the contract provision demonstrates that respondent retained the
right to cancel the contract for deed despite earlier defaults. Moreover, a party can waive the cancellation
of a contract for deed only when there is a showing, which did not occur here,
that “the waiving party had full knowledge of the facts and his legal rights and
intended to relinquish these rights.” Thomey v. Stewart, 391 N.W.2d 533, 536 (Minn. App. 1986).
Appellant also maintains that
respondent waived her right to cancel the contract for deed because she
retained three $500 money orders dated December 29, 2003. Appellant attempted to deliver the money
orders by placing them in respondent’s mailbox.
The mere delivery of a sum of money does not establish the required
acceptance by plaintiff. Jandric v. Skahen, 235 Minn. 256, 261, 50 N.W.2d 625, 628 (1951). The money orders represented a small fraction
of the amount of appellant’s default, and respondent did not cash the money orders but turned them over to
her attorney, who returned them to appellant by certified mail. The money orders were subsequently returned as
unclaimed to respondent’s attorney.
Nothing in this record suggested to appellant or shows to this court the
intention of respondent to keep the money orders.
his attack on the legality of the contract for deed, appellant contends that he
is entitled to specific performance in exchange for full payment on the
contract for deed. But once statutory
notice has been served and cancellation effected, all rights under a contract
for deed are terminated. Zirinsky v. Sheehan, 413 F.2d 481, 484
(8th Cir. 1969), cert. denied, 369 U.S. 1059 (1970); West v. Walker, 181 Minn. 169, 171, 231 N.W. 826, 827 (1930); Olson v. N. Pac. Ry. Co., 126 Minn.
229, 231, 148 N.W. 67, 68 (1914).
Similarly, appellant maintains that
the doctrine of equitable conversion establishes that he holds equitable title
to the property. But title interests of
the vendee are vested on the condition that the vendee does not default on the
contract. Tollefson Dev., Inc. v. McCarthy,
668 N.W.2d 701, 704 (Minn.
App. 2003). Because appellant did
not take action to cure the default after notice of cancellation was served, he
is no longer vested with equitable title.
In a further extension of his plea
for specific performance, appellant alleges fraud on the part of Richard Elasky
at the time of the execution of the contract for deed. But appellant did not plead fraud in his
amended complaint as required by Minn. R. Civ. P. 9.02. “Failure to particularly plead fraud
justifies summary judgment against the party alleging it.” Berke
v. Resolution Trust Corp., 483 N.W.2d 712, 717 n.3 (Minn. App. 1992), review denied (Minn. May 21, 1992).