from the District Court of LaMoure County, Southeast Judicial
District, the Honorable Daniel D. Narum, Judge.
D. McNary, Fargo, ND, for plaintiff and appellee.
F. Lester, Fargo, ND, for defendant and appellant.
VANDEWALLE, CHIEF JUSTICE.
Jared Larson appealed a district court judgment foreclosing a
mortgage in favor of Heartland State Bank. Larson argues the
judgment should be reversed because Heartland's notice
before foreclosure was legally insufficient. We affirm.
In July 2015, Larson granted a mortgage to Heartland for
property in LaMoure County. The mortgage secured three
promissory notes: 1) note 77392, executed in May 2014 for the
principal amount of $200, 000; 2) note 77444, executed in
June 2014 for the principal amount of $70, 000; and 3) note
77886, executed in July 2015 for the principal amount of
$575, 393.70. In March 2017, Heartland sued Larson seeking
foreclosure of the mortgage, alleging he defaulted under the
mortgage by failing to make payments on the notes.
Before suing Larson, Heartland served him with a notice
before foreclosure under N.D.C.C. §§ 32-19-20 and
32-19-21. The notice stated he had thirty days to reinstate
the mortgage by paying the following: 1) $212, 845.39 on note
77392; 2) $25, 949.28 on note 77444; and 3) $96, 083.20 on
note 77886, for a total of $334, 877.87. Larson did not pay
or offer to pay that amount within thirty days.
In September 2017, Heartland moved to amend its complaint
after its attorney learned of a July 2016 default judgment in
Stutsman County against Larson relating to the notes. A
judgment of $782, 273.17 was entered against Larson for
failing to pay the amounts due under the notes. Heartland
alleged in its motion to amend that in addition to not making
payments on the notes, Larson defaulted under the mortgage by
failing to satisfy the judgment. Larson objected, arguing the
amended complaint would be futile because the amendment would
make the notice before foreclosure legally insufficient. The
district court granted Heartland's motion to amend its
Heartland moved for summary judgment, arguing it was
appropriate because Larson failed to satisfy the Stutsman
County judgment. In response, Larson claimed that
Heartland's amended complaint rendered the notice before
foreclosure defective and fatal to Heartland's case.
Larson argued Heartland failed to strictly comply with the
notice before foreclosure requirements because the amount
that Heartland alleged was due on the notes in the notice
differed from the amount due under the default judgment. The
district court granted Heartland's motion, concluding the
notice before foreclosure was legally sufficient:
The Notice Before Foreclosure served by Heartland State Bank
did comply with the requirements of N.D.C.C. Ch. 32-19 under
the circumstances. At the time Heartland State Bank served
the Notice Before Foreclosure upon Larson there were no
installments of principal and interest due and owing by
Larson because the debt obligations had already been reduced
to a judgment entered in Stutsman County District Court, Case
No. 47-2016-cv-00361, in the amount of $782, 273.17, plus
interest at the daily rate of $126.23 from and after July 13,
2016 to the date of the entry of the Judgment.
court entered judgment foreclosing Heartland's mortgage.
Under N.D.R.Civ.P. 15(a), after a responsive pleading has
been served, a complaint may only be amended by leave of
court or by written consent of the opposing party.
Johnson v. Hovland, 2011 ND 64, ¶ 8, 795 N.W.2d
294. "A district court has wide discretion in deciding
whether to permit amended pleadings after the time for an
amendment has passed." Id. A court abuses its
discretion when it acts arbitrarily, unconscionably, or
unreasonably, or when its decision is not the ...