IN SUPREME COURT
Court of Appeals
Filed: July 19, 2007
Office of Appellate Courts
Mark David Gossman, et al.,
S Y L L A B U S
1. When the validity of a notice of lis pendens is challenged on the grounds that the allegations in the complaint in the underlying action are legally insufficient, the application to discharge the notice of lis pendens is not separate from the merits of the underlying action.
2. When the application to discharge the notice of lis pendens is not separate from the merits of the underlying action, an order denying discharge of the notice of lis pendens is not appealable under Minn. R. Civ. App. P. 103.03(g).
3. When the application to discharge the notice of lis pendens is not separate from the merits of the underlying action, an order denying discharge of the notice of lis pendens is not appealable under the collateral order doctrine.
Heard, considered, and decided by the court en banc.
O P I N I O N
Appellants Mark David Gossman, et al. (collectively, Gossman), filed an application to discharge a notice of lis pendens on Mark Gossman’s residence. The district court denied the application, and Gossman appealed. The court of appeals dismissed the appeal, holding that the denial of an application to discharge a notice of lis pendens is not immediately appealable. We granted Gossman’s petition for review and, for the reasons discussed below, affirm.
Respondents St. Croix Development,
LLC, and Montari Homes, Inc. (collectively,
April 4, 2006, St. Croix filed notices of lis pendens on four commercial
properties purchased by Mark Gossman after termination of his employment with
Notices of lis pendens are governed by Minn. Stat. § 557.02 (2006), which reads in relevant part:
[i]n all actions in which the title to, or any interest in or lien upon, real property is involved or affected, or is brought in question by either party, any party thereto * * * may file for record with the county recorder of each county in which any part of the premises lies a notice of the pendency of the action, containing the names of the parties, the object of the action, and a description of the real property in such county involved, affected or brought in question thereby. From the time of the filing of such notice * * * the pendency of the action shall be notice to purchasers and encumbrancers of the rights and equities of the party filing the same to the premises.
a notice of lis pendens is “properly filed only if plaintiff pleads a cause of
action which involvesor affects
the title to, or any interest in or a lien upon, specifically described real
property.” Rehnberg v. Minn. Homes, Inc., 236
With respect to the discharge of a notice of lis pendens, Minn. Stat. § 557.02 states:
Any party claiming any title or interest in or to the real property involved or affected may on such notice as the court shall in each case prescribe, make application to the district court in the county in which the action is pending or in which the real property involved or affected is situated, for an order discharging the lis pendens of record.
Consequently, by making a proper application, a party may obtain district court review of the validity of a notice of lis pendens.
In Rehnberg v. Minnesota Homes, Inc., we held that an order discharging a notice of lis pendens is
immediately appealable. 235
We have not previously addressed whether an order denying discharge of a notice of lis pendens is immediately appealable. Gossman argues that such an order is immediately appealable either under Minn. R. Civ. App. P. 103.03(g) or under the collateral order doctrine. We conclude that the order denying Gossman’s application to discharge the notice of lis pendens is not separate from the merits of the underlying action and is therefore not appealable under either Rule 103.03(g) or the collateral order doctrine.
Minnesota Rule of Civil Appellate Procedure 103.03(g) permits an appeal to be taken “except as otherwise provided by statute, from a final order, decision or judgment affecting a substantial right made in an administrative or other special proceeding.” In this case, the court of appeals held that the order denying the application to discharge the notice of lis pendens on the residence was not immediately appealable under Rule 103.03(g) because the order did not affect a substantial right.
We review the construction and
application of procedural rules de novo.
See Kastner v. Star Trails Ass’n,
646 N.W.2d 235, 238 (
In this case, Gossman seeks to have
the notice of lis pendens on the residence discharged on the grounds that the complaint
does not properly make out a claim that might entitle St. Croix to recovery of
an interest in the residence should St. Croix prevail at trial. In doing so Gossman argues, in accord with
our cases reviewing decisions involving notices of lis pendens, that
review of the allegations requires application of a standard similar to the
standard found in Minn. R. Civ. P. 12.03.
That standard tests the legal sufficiency of the pleading while assuming
the factual allegations to be true. Bodah v. Lakeville Motor Express, Inc.,
663 N.W.2d 550, 553 (
The collateral order doctrine permits
interlocutory appeals from qualifying district court orders, even if those
orders are not identified as immediately appealable by the Rules of Civil
Appellate Procedure. Kastner, 646 N.W.2d at 240. The collateral order doctrine applies to the
“‘small class [of decisions] which finally determine claims of right separable
from, and collateral to, rights asserted in the action, too important to be
denied review and too independent of the cause itself to require that appellate
consideration be deferred until the whole case is adjudicated.’”
In holding that an order denying an application to discharge a notice of lis pendens is not appealable under the collateral order doctrine, the court of appeals reasoned that such an order—unlike an order actually discharging notice of a lis pendens, which may affect a litigant’s ability to recover an interest in property in the event he or she prevails in the underlying action and which we have held to be appealable—involves only the impairment of the ability to sell property and is not sufficiently important to merit interlocutory appeal. The court also stated that Gossman has “not established that the September 18 order denying the motion to discharge the notice of lis pendens resolves an issue completely separate from the merits of the action.”
We agree with the court of appeals that Gossman’s application to discharge the notice of lis pendens on the residence is not separate from the merits of the underlying action. As discussed above, because review of the legal merits of the underlying action is required in order to determine whether denial of the application was proper in this case, the question presented is not separate from the merits of the action. Therefore, the district court’s order denying Gossman’s application is not immediately appealable under the collateral order doctrine.
While we conclude that the denial of Gossman’s
application to discharge the notice of lis pendens on the residence is not
immediately appealable, we recognize that a notice of lis pendens may place a
significant burden on a property owner. And
we realize that the inability to appeal the denial of an application to
discharge such a notice may exacerbate that burden. We are also not unmindful that our rules of
civil appellate procedure permit the immediate appeal of orders vacating or
sustaining attachments, which involve property interests similar to those
implicated by notices of lis pendens. See
are: Mark David Gossman; Stephanie Rae
Gossman; Commercial Equity Partners, Inc.; Tamhills Funding, LLC; Tamhills,
LLC; Maple Leaf Holdings, LLC; Pointe
 Minnesota Statutes § 557.02 also provides that a notice of lis pendens “shall be void and of no force nor effect” in the event that the underlying action “has not been brought to trial within two years after the filing of the lis pendens.”
 The appealability of an order granting discharge of a notice of lis pendens has not subsequently been questioned by this court, and we have no occasion to do so here.
 See, e.g., Grace Dev. Co., 306