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Marine Credit Union v. Detlefson-Delano

Supreme Court of Minnesota

May 22, 2013

Marine Credit Union, Respondent,
v.
Anne K. Detlefson-Delano, Appellant, Jack Antonio, Respondent.

Office of Appellate Courts

Thomas B. Olson, Shaun D. Redford, Olson & Lucas, P.A., Edina, Minnesota, for respondent Marine Credit Union.

Dwight D. Luhmann, David A. Joerg, P.A., Preston, Minnesota, for appellant.

SYLLABUS

Any conveyance of the homestead to a third party pursuant to Minn. Stat. § 507.02 (2012) requires the signature of both spouses unless (1) a statutory exception to the signature requirement in section 507.02 applies or (2) one spouse has explicitly waived his or her rights under the homestead statute.

OPINION

PAGE, Justice.

This appeal arises out of a district court action brought by respondent Marine Credit Union (MCU) seeking to foreclose on the homestead that appellant Anne Detlefson-Delano and her husband Jack Antonio own.[1] The district court granted summary judgment to Detlefson-Delano after concluding that the mortgage Detlefson-Delano signed with MCU is void under Minn. Stat. § 507.02 (2012) because it was not also signed by Antonio. The court of appeals reversed, holding that the mortgage was valid despite the absence of Antonio's signature because Antonio had quitclaimed all of his interest in the homestead property to Detlefson-Delano before the mortgage was executed. We hold that the mortgage at issue here does not meet any of the statutory exceptions to the signature requirement in section 507.02 and that Antonio's quitclaim deed did not constitute an explicit waiver of his rights under the homestead statute. Therefore, we reverse.

In December 1994, Detlefson-Delano and her then-husband D.D. acquired property in Harmony, Minnesota. In 2003, Detlefson-Delano and D.D. divorced, and Detlefson-Delano was awarded sole ownership of the property. In 2005, Detlefson-Delano married Antonio, who began living on the property along with Detlefson-Delano and her two children. MCU does not dispute that the property became Antonio's homestead when he and Detlefson-Delano married.

In the summer of 2007, Detlefson-Delano and Antonio listed the property for sale with a real estate agent. According to Detlefson-Delano, the real estate agent asked that Antonio execute a quitclaim deed transferring his interest in the property to Detlefson-Delano in order to facilitate a sale of the property. On July 24, 2007, Antonio signed and delivered a quitclaim deed to Detlefson-Delano. The deed was recorded the following day, transferring "all the right, title, interest and claim" that Antonio had in the property to Detlefson-Delano.

When the property did not sell, Detlefson-Delano approached MCU about refinancing. According to Detlefson-Delano, Antonio thought that refinancing the property was necessary, and on January 18, 2008, Detlefson-Delano signed an $84, 000 note secured by a mortgage on the property in favor of MCU. MCU did not obtain Antonio's signature on either the note or the mortgage. The record indicates that the loan officer who made the loan for MCU was aware at the time that Antonio had previously executed a quitclaim deed to Detlefson-Delano and that Detlefson-Delano was married to Antonio. The loan officer claims that Detlefson-Delano led him to believe that Antonio had abandoned her and was no longer living in the area. Detlefson-Delano claims that MCU specifically told her that Antonio did not need to attend the mortgage closing. At the time this action was filed in the district court, Detlefson-Delano was living on the property with her two children, but she and Antonio have been estranged since sometime in 2009.

In October 2009, Detlefson-Delano defaulted on the note, which resulted in MCU commencing this foreclosure action. Detlefson-Delano counterclaimed, alleging that the mortgage is void pursuant to Minn. Stat. § 507.02 because it was not signed by Antonio. In its answer to the counterclaim, MCU asserted that the mortgage is valid because Antonio "agreed to [its] terms" by quitclaiming his interest in the property to Detlefson-Delano. MCU also amended its complaint and asserted that Detlefson-Delano should be equitably estopped from contesting the validity of the mortgage.

MCU moved for summary judgment. Finding no genuine issues of material fact, the district court denied MCU's motion and instead granted summary judgment to Detlefson-Delano as a matter of law. In doing so, the district court concluded that Detlefson-Delano was not estopped from asserting her claim and that the mortgage was void under Minn. Stat. § 507.02. The court also concluded that the quitclaim deed did not operate as a waiver of Antonio's homestead rights because (1) the deed was given for the purpose of listing the property for sale, (2) Antonio was living at the property and thus asserting his homestead rights when the mortgage was executed, and (3) the quitclaim deed was executed and delivered "subsequent to the execution of the mortgage."[2]

The court of appeals reversed, holding that the mortgage is valid even though Antonio had not signed it. Marine Credit Union v. Detlefson-Delano, 813 N.W.2d 429, 433 (Minn.App. 2012). According to the court, because Antonio's quitclaim deed was a complete transfer of all of his interest in the property to Detlefson-Delano, Antonio did not retain any homestead interest and, accordingly, only Detlefson-Delano's signature was required to convey the property. Id. at 432-33. The court also held that the district court's finding that the quitclaim deed was executed after the mortgage was clearly erroneous. Id. at 431. Notably, MCU did not pursue its equitable estoppel argument in the court of appeals. Id. at 431 n.1.

We granted Detlefson-Delano's petition for review on the sole issue of whether a quitclaim deed, transferring homestead property from one spouse to another, negates the requirement set out in Minn. Stat. ยง 507.02 that both spouses must sign a conveyance of the homestead to a third party. We denied MCU's petition for conditional cross-review on the issue ...


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