U.S. Bank v. Langmaid

IN THE COURT OF APPEALS OF IOWA
No. 23-0076
Filed December 6, 2023
U.S. BANK NATIONAL ASSOCIATION AS SUCCESSOR BY MERGER OF U.S.
BANK NATIONAL ASSOCIATION ND,
Plaintiff-Appellant,
vs.
DON W. LANGMAID, JR., MARILYN L. LANGMAID, DON W. LANGMAID, JR.
and MARILYN LEE LANGMAID REVOCABLE TRUST, KIRK LANGMAID,
THERESA LANGMAID, MORTGAGE ELECTRONIC REGISTRATION
SYSTEMS, INC., QUICKEN LOANS, LLC, n/k/a ROCKET MORTGAGE, LLC,
and PARTIES IN POSSESSION,
Defendants-Appellees.
________________________________________________________________
Appeal from the Iowa District Court for Jasper County, Stacy Ritchie, Judge.
U.S. Bank appeals a district court ruling dismissing its petition with prejudice
for lack of subject matter jurisdiction. REVERSED AND REMANDED WITH
INSTRUCTIONS.
Donald J. Pavelka Jr. of Locher Pavelka Dostal Braddy & Hammes, LLC,
Council Bluffs, for appellant.
David J. Hellstern of Sullivan & Ward, P.C., West Des Moines, for appellees
Don W. Langmaid Jr, Marilyn L. Langmaid, Don W. Langmaid Jr. and Marilyn Lee
Langmaid Revocable Trust, Kirk Langmaid, and Theresa Langmaid.
Scott A. Hall of Carney & Appleby, PLC, Des Moines, for appellee Quicken
Loans, LLC, n/k/a Rocket Mortgage, LLC.
Considered by Bower, C.J., and Ahlers and Chicchelly, JJ.
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BOWER, Chief Judge.
U.S. Bank appeals a district court ruling dismissing with prejudice its
foreclosure petition against Don Langmaid; Marilyn Langmaid; Don W. Langmaid
and Marilyn Lee Langmaid Revocable Trust; Kirk Langmaid; Theresa Langmaid;
and Quicken Loans, LLC (collectively, the Langmaids), regarding property owned
by Don and Marylin. U.S. Bank contends, because the district court lacked subject
matter jurisdiction, it could not make a ruling on whether a homestead exemption
exists. U.S. Bank also contests the ruling any future petition is subject to the two-
dismissal rule enumerated in Iowa Rule of Civil Procedure 1.943. We reverse and
remand with instructions.
I. Background Facts and Proceedings
In a petition filed in 2019, U.S. Bank sought foreclosure of the Langmaids’
real estate in Jasper County. The parties settled, and the case was voluntarily
dismissed by U.S. Bank.
At issue here is a petition filed in June 2022 for foreclosure on the same
property, again filed by U.S. Bank. The Langmaids filed a pre-answer motion to
dismiss, claiming the property was agricultural property and therefore subject to
pre-foreclosure farm mediation pursuant to Iowa Code section 654A.6(1)(a)
(2022).
The district court granted the Langmaids’ motion to dismiss. U.S. Bank
appeals, claiming the court should have dismissed the case without prejudice
rather than with prejudice.
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II. Standard of Review
We review rulings on subject matter jurisdiction for errors at law. Shaefer
v. Putnam, 841 N.W.2d 68, 74 (Iowa 2013). A court has inherent power to
determine whether it has jurisdiction over the subject matter of the proceedings
before it. Klinge v. Bentien, 725 N.W.2d 13, 15 (Iowa 2006).
III. Subject Matter Jurisdiction
Iowa Code section 654A.6(a)(1) reads, “A creditor . . . desiring to initiate a
proceeding to enforce a debt against agricultural property which is real estate
under chapter 654 . . . shall file a request for mediation with the farm mediation
service.” Neither party disputes the district court finding this property is agricultural
property, and U.S. Bank acknowledges they failed to request mediation under the
statute. The only issue before us is whether the district court erred when it
dismissed the petition with prejudice for lack of lacked subject matter jurisdiction.
In deciding to dismiss with prejudice, the district court relied on Iowa Rule of Civil
Procedure 1.943, titled “Voluntary Dismissal,” which reads:
A party may, without order of court, dismiss that party’s own
petition . . . at any time up until ten days before the trial is scheduled
to begin. . . . A dismissal under this rule shall be without prejudice,
unless otherwise stated; but if made by any party who has previously
dismissed an action against the same defendant, in any court of any
state or of the United States, including or based on the same cause,
unless otherwise ordered by the court, such dismissal shall operate
as an adjudication against that party on the merits, in the interests of
justice.
The district court found it was required to dismiss the petition based on lack
of subject matter jurisdiction:
[T]his [forty]-acre plat of land described in the legal description is
agricultural property as defined by [Iowa Code section] 654A.1, and
[U.S. Bank] has therefore failed to:
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a. file a request for farm mediation . . .;
b. receive a farm mediation release . . . ‘
c. give [the Langmaids] proper deadlines for a notice to cure .
. . [and];
d. give [the Langmaids] a proper deadline for a notice to
accelerate . . . .
These errors, specifically regarding the farm mediation
requirements . . . are jurisdictional prerequisites to a creditor filing
action, meaning without them, this court is without jurisdiction to hear
this matter, and this matter must therefore be dismissed.
The district court further found the dismissal should be with prejudice: “Pursuant
to Iowa Rule of Civil Procedure 1.943 and 1.946, and finding that this Property is
protected as a homestead, and that Plaintiff does not have a signed homestead
exemption in its Mortgage, this matter should therefore be dismissed with
prejudice.”
We determine the district court acted beyond its power in making the
second part of this ruling. After finding it lacked subject matter jurisdiction, the
district court impermissibly made findings of fact and conclusions on the merits of
the case. See State v. Rutherford, ___ N.W.2d ___, ___, 2023 WL 7237087, at *2
(Iowa 2023) (noting “[w]ithout jurisdiction the court cannot proceed at all in any
cause” (citation omitted)). The district court’s conclusion the property is protected
as a homestead was a ruling on the merits.
The district court’s application of rule 1.943 was incorrect. Since the district
court dismissed U.S. Bank’s petition, it could not consider a voluntary dismissal as
contemplated by rule 1.943. The proper analysis here is found solely in rule 1.946:
“All dismissals not governed by rule 1.943 or not for want of jurisdiction or improper
venue, shall operate as adjudications on the merits unless they specify otherwise.”
(Emphasis added.) It is clear from the plain language of the rule that dismissals
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for lack of subject matter jurisdiction are to be without prejudice, as lack of
jurisdiction is one of only two exceptions to a dismissal constituting a judgment on
the merits.
The Langmaids argue ACC Holdings, LLC v. Rooney should control. 973
N.W.2d 851, 853–55 (Iowa 2022). In ACC Holdings, after voluntarily dismissing
two previous suits for forcible entry and detainer (FED), a tax deedholder filed a
third complaint on the same grounds. Id. at 852–53. The supreme court found the
second voluntary dismissal was an adjudication on the merits under rule 1.943 and
therefore held the case should be dismissed with prejudice. Id. at 854.
Specifically, the Langmaids claim the following hypothetical, posed in dicta of the
opinion, should inform our conclusions here:
Finally, consider a thought experiment. Suppose a district
court had involuntarily dismissed the second FED action. Would a
district court have allowed ACC to bring a third FED action based
merely on the same tax deed and the same continued occupancy?
We think clearly not. Accordingly, rule 1.943 barred ACC’s third FED
action, and it was error for the district court to conclude otherwise.
Id. at 855 (footnote omitted). We disagree. ACC Holdings deals with voluntary
dismissals. The Langmaids argue rule 1.943 should apply to the involuntary
dismissal here, but the plain text of rule 1.943 cuts against their claim. In ACC
Holdings, the supreme court refers to involuntary dismissals other than those
specifically set aside in rule 1.943, namely dismissals due to want of jurisdiction or
improper venue. Therefore, application of the principles espoused in ACC
Holdings would be improper here.
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We reverse the district court and remand for dismissal without prejudice in
accordance with this ruling.
REVERSED AND REMANDED WITH INSTRUCTIONS.