Matthew Viscito, Mary Lynn Berntson, and Florence Properties, LLC, Plaintiffs and Appellants
Kevin Christianson, Pace's Lodging Corporation, Mednational, LLC, Aurora Medical Park No. 2, LLC, and Jeff Sjoquist, Defendants and Appellees
from the District Court of Grand Forks County, Northeast
Central Judicial District, the Honorable Debbie Gordon
T. Schuetzle, for plaintiffs and appellants.
Michael T. Andrews, for defendants and appellees.
Fair McEvers, Justice.
1] Matthew Viscito, Mary Lynn Berntson, and Florence
Properties, LLC, (collectively "Viscito") appeal
from a judgment entered on remand awarding Kevin
Christianson, Pace's Lodging Corp., Mednational, LLC,
Aurora Medical Park No. 2, LLC, and Jeff Sjoquist
(collectively "Christianson") attorney fees of $33,
405.14. We conclude the district court on remand did not
follow our mandate in Viscito v. Christianson, 2015
ND 97, 862 N.W.2d 777 (" Viscito I "),
when the court applied N.D.R.Civ.P. 41 to justify the full
amount of its prior attorney fees and costs award. We reverse
2] Our prior decision in Viscito I, 2015 ND 97, 862
N.W.2d 777, sets forth relevant facts in this case, which we
repeat here only insofar as necessary to assist in resolving
the issues raised in this appeal.
3] Viscito sued Christianson asserting claims regarding the
parties' agreement to build, own, and lease a hospital.
On August 1, 2013, the district court granted
Christianson's motion to compel arbitration, ordering the
parties to complete arbitration within six months. On January
30, 2014, Viscito moved for an extension of time to complete
arbitration. In response Christianson opposed the motion,
moved to dismiss the action with prejudice, and requested
"costs and fees incurred herein" under N.D.R.Ct.
11.5. In March 2014 the district court held a hearing on the
parties' motions and ruled from the bench that the case
be dismissed without prejudice and awarded Christianson
reasonable attorney fees and costs. In May 2014 the court
entered a judgment of dismissal without prejudice, awarding
Christianson $33, 405.14 for the full amount of costs and
attorney fees Christianson had incurred in defending the
4] Viscito appealed the judgment, arguing the district court
had abused its discretion in awarding all of
Christianson's costs and attorney fees incurred
throughout the case because the court misinterpreted the
rules authorizing sanctions. In Viscito I, 2015 ND
97, ¶¶ 31, 34, 862 N.W.2d 777, we reversed the
court's award and remanded for a determination of
authority on which the court had imposed sanctions and for
findings necessary to support its award. As we explained, the
record did not permit a meaningful review of the district
Based upon a review of the record, we are unable to determine
the authority the district court relied on for awarding
attorney's fees and costs. In Christianson's motion
to dismiss, it requested attorney's fees and costs under
N.D.R.Ct. 11.5. Although Christianson cited N.D.R.Civ.P.
41(b) [governing involuntary dismissal] in its supplemental
brief in support of the motion to dismiss with prejudice, it
appears Christianson cited N.D.R.Civ.P. 41(b) to support its
argument that the case should be dismissed with
prejudice, rather than to support its request for
attorney's fees and costs. Under N.D.R.Civ.P. 41(b),
"[i]f the plaintiff fails to prosecute or to comply with
these rules or a court order, a defendant may move to dismiss
the action or any claim against it. Unless the dismissal
order states otherwise, a dismissal under this subdivision
(b)... operates as an adjudication on the merits."
Because N.D.R.Civ.P. 41(b) does not explicitly authorize an
award of attorney's fees and costs, and the district
court dismissed without prejudice, it appears the district
court did not award Christianson attorney's fees and
costs under this rule.
As noted above, Christianson requested sanctions under
N.D.R.Ct. 11.5. Under N.D.R.Ct. 11.5, "[t]he trial court
may take any appropriate action against any person failing to
perform an act required by the rules or required by court
order. Appropriate action includes a sanction provided by
Rules 5, 11, 16, 25, 30, 37, 40, 45, or 56, N.D.R.Civ.P.
" Because Christianson argued Viscito failed to obey a
pretrial order, N.D.R.Civ.P. 16(f) applies to this case.
Under N.D.R.Civ.P. 16(f)(1)(C), "[o]n motion or on its
own, the court may issue any just orders... if a party or its
attorney:... fails to obey a scheduling or other pretrial
order." (Emphasis added.) If a court orders a
sanction under N.D.R.Civ.P. 16(f), "the judge must order
the party, its attorney, or both to pay the reasonable
expenses, including attorney fees, incurred because of
any noncompliance with this rule, unless the
noncompliance was substantially justified or that other
circumstances make an award of expenses unjust."
N.D.R.Civ.P.16 (f)(2) (emphasis added).
Rule 16, N.D.R.Civ.P., limits the award of sanctions to
reasonable expenses, including attorney fees, incurred "
because of any noncompliance with this rule."
Specifically, N.D.R.Civ.P. 16 limits the fees and costs to
those reasonable expenses incurred as a result of the failure
to obey a pretrial order. If N.D.R.Civ.P. 16 is the basis for
the sanction, the district court should have limited its
award of attorney's fees and costs to those incurred as a
result of Viscito's violation of the court order
compelling arbitration be completed within six months. The
district court provided no reasoning to explain why it
awarded attorney's fees and costs for the entire matter.
We are also unable to determine whether the district court
relied on its inherent power to sanction because it did not
reference its inherent power to sanction, nor did it conduct
the necessary analysis.
"A district court has the inherent power to sanction a
litigant for misconduct." Dronen v. Dronen,
2009 ND 70, ¶ 51, 764 N.W.2d 675. "Inherent power
sanctions require case-by-case analysis of all the
circumstances presented in the case." Bachmeier v.