This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480A.08, subd. 3 (1996).

STATE OF MINNESOTA

IN COURT OF APPEALS

C7-96-2472

Ralph Burnet, et al.,

Respondents,

vs.

City of Wayzata,

Defendant,

and

Gary Holmes, defendant-intervenor,

Appellant.

Filed June 17, 1997

Affirmed;

Motions granted in part

and denied in part

Peterson, Judge

Hennepin County District Court

File No. 9513482

Geoffrey P. Jarpe, Larry B. Guthrie, Seth M. Colton, Stephen E. Yoch, Maun & Simon, PLC, 2300 World Trade Center, 30 East Seventh Street, St. Paul, MN 55101-4904 (for Respondents)

Robert L. Meller, Jr., Best & Flanagan, 4000 First Bank Place, 601 Second Avenue South, Minneapolis, MN 55402 (for Defendant)

Robert J. Tansey, Jr., Mark D. Wisser, Robins, Kaplan, Miller & Ciresi L.L.P., 2800 LaSalle Plaza, 800 LaSalle Avenue, Minneapolis, MN 55402 (for Appellant)

Considered and decided by Peterson, Presiding Judge, Lansing, Judge, and Schumacher, Judge.

U N P U B L I S H E D O P I N I O N

PETERSON, Judge

Appellant challenges a district court order denying his requests for sanctions and discovery. Because the district court did not abuse its discretion, we affirm. Respondents move to dismiss the appeal on jurisdictional grounds, to strike portions of appellant's reply brief, and for sanctions. We grant the motion to strike in part and deny respondents' other motions.

FACTS

Appellant Gary Holmes purchased a 3.5 acre lot on the shore of Lake Minnetonka in Wayzata, where he intended to build a house. In the spring of 1995, the City of Wayzata granted a setback variance and issued a grading permit to appellant. In preparation for construction, appellant brought in 1,150 truckloads of fill and removed topsoil, scrub trees, and bushes. On August 6, 1995, the city experienced heavy rains, causing fill and topsoil to wash from appellant's property into Lake Minnetonka and possibly onto a neighbor's property. The Minnesota Department of Natural Resources issued a criminal citation against appellant and his architect for allowing the soil to wash into the lake.

Respondents, who are neighboring landowners, petitioned the district court for a writ of mandamus directing the city to enforce provisions of its zoning ordinance and moved for a temporary restraining order or a temporary injunction to prevent the city from issuing appellant a building permit. Appellant was permitted to intervene and moved for dismissal, or, in the alternative, for summary judgment, and requested sanctions. On September 22, 1995, the district court denied the petition for writ of mandamus and the request for injunctive relief and denied appellant's motions and his request for sanctions.

Respondents appealed the district court's decision. While the appeal was pending, the city denied appellant's application for a building permit. This court dismissed the injunctive relief issue on mootness grounds and affirmed the district court's denial of the petition for a writ of mandamus. Burnet v. City of Wayzata, No. CX-95-2150 (Minn. App. Apr. 16, 1996).

On remand, respondents requested dismissal of their lawsuit. Appellant moved for sanctions pursuant to Minn. Stat. § 549.21, subd. 2 (1996), and Minn. R. Civ. P. 11, alleging that respondents brought bad faith and legally groundless claims for injunctive and mandamus relief. On July 10, 1996, a judgment dismissing the case was entered. The judgment did not address the pending motion for sanctions. On August 20, 1996, the district court held a hearing on the motion for sanctions. The court denied the motion for sanctions on October 31, 1996.

On December 6, 1996, appellant filed a notice of appeal from the order denying sanctions. Respondents moved for sanctions against appellant, asserting that the appeal is untimely, improper, and filed merely to harass the respondents. On December 31, 1996, appellant filed an appeal from the July 10, 1996, judgment dismissing the action and, thereafter, moved to consolidate the two appeals. On January 16, 1997, appellant voluntarily dismissed the appeal taken from the judgment of dismissal. Respondents then requested that this court dismiss the remaining appeal for lack of jurisdiction and moved to strike portions of appellant's reply brief as "new matter."

D E C I S I O N

I. Jurisdiction

A party must appeal a judgment within 90 days from entry. Minn. R. Civ. App. P. 104.01. This court cannot extend the time to file an appeal. Minn. R. Civ. App. P. 126.02. We will dismiss an appeal not taken within 90 days after entry of judgment. Estate of Spiess v. Schumm, 442 N.W.2d 179, 180 (Minn. App. 1989).

Minn. R. Civ. P. 54.02, provides:

When multiple claims for relief or multiple parties are involved in an action, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for entry of judgment. In the absence of such determination and direction, any order or other form of decision, however designated, which adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties shall not terminate the action as to any of the claims or parties, and the order or other form of decision is subject to revision at any time before the entry of judgment adjudicating all the claims and the rights and liabilities of all the parties.

The district court order dismissing respondents' action stated only, "That the above entitled action is hereby dismissed, with prejudice." The order did not contain an express determination that there is no just reason for delay or an express direction for entry of judgment. Respondents contend that because the order contained no designation or reservation that fewer than all of the claims had been adjudicated, the order did not reserve the sanctions issue. Instead, respondents argue, the order adjudicated all claims and entry of the judgment of dismissal ended the case. Therefore, respondents conclude, appellant cannot appeal the order denying his request for sanctions because the order is not independently appealable and there is no judgment from which the order can be appealed.

Respondents' argument misconstrues rule 54.02. Under rule 54.02, a court that addresses some, but not all, of the issues before it is not required to expressly reserve any issue that has not been addressed in order to keep the issue before the court. Instead, all issues before the court, including issues the court has decided, remain before the court unless the court expressly determines that there is no just reason for delay and expressly directs entry of a final judgment regarding the issues it has decided. If the court makes these express determinations, a final judgment may be entered as to the issues it has decided, but issues the court has not decided remain before the court.

Here, respondents moved for voluntary dismissal on June 6, 1996. Appellant moved for sanctions on June 12, 1996, and a hearing on the motion was scheduled for August 20, 1996. The parties had a hearing on respondents' motion to dismiss.[1] Based on these facts, the judgment of dismissal entered on July 10, 1996, was a partial judgment because appellant's motion for sanctions was pending when the judgment was entered. Minn. R. Civ. P. 54.02. Because the district court's order of dismissal did not expressly determine that there was no just reason for delay nor expressly direct entry of judgment, the judgment entered on that order was not a "final" judgment. When the district court issued its order denying appellant's request for sanctions on October 31, 1996, all issues and claims had been adjudicated or addressed, and a final judgment should have been entered. In the interest of judicial economy, we will review the October 31, 1996, order rather than remand for entry of another judgment.

II. Appellant's Request for Sanctions

An appellate court reviews a decision regarding the award of sanctions under an "abuse of discretion" standard. Uselman v. Uselman, 464 N.W.2d 130, 141 (Minn. 1990). A court abuses its discretion when it reaches a conclusion that is "against logic and the facts on the record." Rutten v. Rutten, 347 N.W. 2d 47, 50 (Minn. 1984).

In denying appellant's motion for sanctions, the district court stated:

Since the [respondents] survived the motion for dismissal or summary judgment, sanctions are not appropriate. Judge Rosenbaum's ruling keeping the case alive indicates that she believed that the case was not entirely frivolous. It is not clear that the case was brought solely to harass Holmes. Therefore, Holmes' motion for sanctions is denied.

The Judge Rosenbaum ruling to which the district court referred was the September 22, 1995, order that denied respondents' petition for writ of mandamus and request for injunctive relief and also denied appellant's motion for dismissal, or, in the alternative, for summary judgment, and appellant's request for sanctions.

Appellant acknowledges that under Uselman, specific protections from sanctions are available for "a party who survives [dispositive] motions with the major claims intact." 464 N.W.2d. at 144 (emphasis added). Appellant argues, however, that the district court abused its discretion in denying him sanctions solely on the basis that respondents' claims survived dispositive motions because respondents' claims, in reality, did not survive his motion for summary judgment. Appellant contends that respondents' claims did not survive intact because Judge Rosenbaum denied respondents' request for injunctive relief and rejected respondents' request for a writ of mandamus on every ground. Thus, appellant concludes, nothing remained of respondents' claims, and Judge Rosenbaum, in effect, granted appellant's summary judgment motion.[2]

We first note that the district court did not deny sanctions solely on the basis that respondents' claims survived dispositive motions. The district court also expressly stated that it was not clear that the case was brought solely to harass appellant. Appellant also fails to recognize that Judge Rosenbaum's denial of injunctive relief and the request for a writ of mandamus was only a determination that respondents were not entitled to immediate relief. Judge Rosenbaum did not determine that respondents were not entitled to any relief. In denying respondents' requests for immediate relief while also denying appellant's motion for summary judgment, Judge Rosenbaum simply determined that respondents' action raised potentially viable claims, but the claims could not be decided without further litigation. A denial of injunctive relief does not lead inexorably to the conclusion that the underlying claims are frivolous.

Citing Vetter v. Security Continental Ins. Co., Nos. C3-95-2619, C3-96-374 (Minn. App. Aug. 13, 1996), appellant argues that the respondents should not be allowed to use the denial of his summary judgment motion as a shield against sanctions. In Vetter, sanctions were awarded to a party whose summary judgment motion was initially denied. Vetter is distinguishable from this case, however, because here the court never granted summary judgment while in Vetter, the court explicitly granted summary judgment upon reconsideration.

Appellant also argues that the trial court erred in denying him sanctions without making specific findings of fact. Appellant cites Deeb v. Deeb, No. C6-92-1188 (Minn. App. Dec. 22, 1992), in which this court held that the trial court erred in not making specific findings of fact when it denied sanctions. Deeb, however, is distinguishable because it involved an award of attorney fees under Minn. Stat. § 518.14 (1990). This court has held that the language of Minn. Stat. § 518.14 mandates findings that reveal the trial court's rationale regarding an attorney fee award. See Kronick v. Kronick, 482 N.W.2d 533, 536 (Minn. App. 1992) (findings necessary to reveal rationale for denying attorney fees under Minn. Stat. § 518.14). Neither Minn. Stat. § 549.21, subd. 2, nor Minn. R. Civ. P. 11 contains language requiring findings of fact. The district court did not err in denying appellant's request for sanctions without making a specific finding of fact.

Appellant argues that the district court abused its discretion in failing to award sanctions because the unrebutted evidence established that respondents acted in bad faith. The unrebutted evidence cited by appellant is: (1) a letter from one of the respondents who stated appellant was acting within his legal rights in developing his property; (2) a conversation in which another respondent threatened legal action unless appellant allowed the respondents to resolve the dispute on their terms with the city; and (3) an intermediary, acting for respondents, told appellant the lawsuit would end if he sold the property to respondents.

This evidence, however, does not establish bad faith as a matter of law because: (1) the respondent's letter stated, "If you follow the letter of the law, you are perfectly free of course to stick your finger in the eyes of all of us." The letter did not indicate that appellant was following the letter of the law, and the respondent had not yet met with an attorney to determine whether appellant was complying with the law; (2) merely threatening litigation does not constitute bad faith; and (3) offering a settlement in an attempt to end litigation does not constitute bad faith. We conclude that the trial court did not abuse its discretion in denying appellant's request for sanctions.

III. Discovery and Due Process

Appellant contends that because he has a liberty interest in his right to gather evidence in support of his motion for sanctions, the trial court violated his due process rights by denying his motion to compel discovery. Appellant had the burden of proving his sanctions claim. The trial court denied him an opportunity to meet that burden, appellant argues, and thus violated his right to procedural due process, when it did not allow him to conduct discovery in support of his sanctions claim.

We know of no authority, and appellant does not cite any authority, that establishes a constitutional right to conduct discovery.[3] Absent any authority establishing such a constitutional right, we conclude that appellant was not unconstitutionally denied an opportunity to conduct discovery.

IV. Motion to Strike

Respondents move this court to strike portions of appellant's reply brief as new matter and impose sanctions for appellant's failure to follow Minn. R. Civ. App. P. 128.02, subd. 3. Respondents contend that appellant's reply brief contains new arguments that expand his analysis of the legal effect of the trial court's resolution of the mandamus issue.

"The reply brief must be confined to new matter raised in the brief of respondent." Minn. R. Civ. App. P. 128.02, subd. 3. For purposes of Rule 128.02, "new matter" means "new issues." State v. Medibus-Helpmobile, Inc., 481 N.W.2d 86, 93 (Minn. App. 1992), review denied (Minn. Mar. 19, 1992). An appellant must limit the reply brief to a concise answer to new points made by respondent, not a repetition of arguments previously made or new matter not in response to points made by respondent. Albert Lea Ice & Fuel Co. v. United States Fire Ins. Co., 239 Minn. 198, 205, 58 N.W.2d 614, 619 (1953). Although a reply brief will be construed liberally to allow an appellant to respond to a respondent's arguments, a reply brief "is not a vehicle to 'resurrect' issues that were omitted from the opening brief." 3 Eric J. Magnuson & David F. Herr, Minnesota Practice § 128.7 (1996).

Respondents correctly assert that in his reply brief, appellant for the first time, cited the mandamus statute, explained that mandamus is a "special proceeding", and argued that when the trial court denied the mandamus petition, it gave up jurisdiction over the case, which made its later denial of appellant's summary judgment motion void. Appellant could have raised this issue in his original brief. Because this argument was made for the first time in the reply brief, we grant the motion to strike.

Respondents also challenge portions of the reply brief discussing the jurisdictional issues addressed in appellant's brief and requested by this court in its January 10 order. Because these sections are not "new matter," the motion to strike is denied.

V. Respondents Request for Sanctions on Appeal

Respondents move for sanctions on appeal under Minn. R. Civ. P. 11 and Minn. Stat. § 549.21, subd. 2, arguing that this court lacks jurisdiction, the appeal is untimely, appellant egregiously mischaracterized the facts on two occasions, and appellant improperly argued "new matter" in his reply brief.

We deny respondents' request for sanctions because we find that this court has jurisdiction, that the appeal is timely, and that any mischaracterization of the facts in appellant's statements of the facts was not egregious. We agree that appellant argues "new matter" in the reply brief, but striking that portion of appellant's reply brief is a sufficient penalty.

Affirmed. Motions granted in part and denied in part.

[ ]1In an affidavit submitted on appeal, appellant's attorney states that there was no court reporter at the hearing, that appellant opposed the motion to dismiss on the ground that dismissal would affect the motion for sanctions, and that the court stated that the motion for dismissal would be granted, but the court would reserve the issue of sanctions for the previously scheduled August 20, 1996, hearing date.

[ ]2Appellant goes on to argue that the trial court later confirmed that nothing remained of respondents' claim when the court denied appellant's motion to compel discovery by staying the case pending appeal. The court, however, only held that allowing discovery to proceed on the narrow issue of damages while the case was on appeal would be counterproductive. Thus, staying the case pending appeal did not "effectively" grant summary judgment.

[ ]3 A California case held that a dismissal, without an opportunity for discovery, did not violate a constitutional right to due process. Dixon v. Superior Court, 30 Cal. App. 4th 733, 746 (Ct. App. 1994), review denied (Cal. Mar. 23, 1995).