C & K Consulting v. Ward County Board of Commissioners (consol w/ 20190313

Filed 5/7/20 by Clerk of Supreme Court
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2020 ND 93
C & K Consulting, LLC, Appellant
v.
Ward County Board of Commissioners, Appellee
No. 20190312
Stonebridge Villas LLC, Appellant
v.
Ward County Board of Commissioners, Appellee
No. 20190313
Stonebridge Villas II LLC, Appellant
v.
Ward County Board of Commissioners, Appellee
No. 20190314
Stonebridge Development Company LLC, Appellant
v.
Ward County Board of Commissioners, Appellee
No. 20190315
Townhomes at Stonebridge LLC, Appellant
v.
Ward County Board of Commissioners, Appellee
No. 20190316
Appeals from the District Court of Ward County, North Central Judicial
District, the Honorable Todd L. Cresap, Judge.
REVERSED AND REMANDED.
Opinion of the Court by Tufte, Justice.
Benjamin J. Hasbrouck (argued), Michael S. Raum (on brief), and Aubrey J.
Fiebelkorn-Zuger (on brief), Fargo, N.D., for appellants.
Mitchell D. Armstrong (argued) and Brian D. Schmidt (on brief), Special
Assistant State’s Attorneys, Bismarck, N.D., for appellee.
C & K Consulting, LLC v. Ward County Board of Commissioners
Nos. 20190312–20190316
Tufte, Justice.
[¶1] C & K Consulting, LLC, Stonebridge Villas LLC, Stonebridge Villas II
LLC, Stonebridge Development Company LLC, and Townhomes at
Stonebridge LLC (together “C&K Consulting”) appeal from a district court’s
dismissal of their cases against the Ward County Board of Commissioners
(“Ward County”) and the court’s denial of their motion for post-judgment relief.
C&K Consulting argues the court erred when it dismissed the cases as a
sanction for missing a briefing deadline. Because the court did not conduct
the required sanctions analysis, we reverse the court’s dismissal judgment and
its order denying C&K Consulting’s motion for post-judgment relief and
remand for further proceedings.
I
[¶2] These consolidated cases are appeals from Ward County’s decisions on
C&K Consulting’s applications for tax abatement and refunds. On January
17, 2019, C&K Consulting appealed Ward County’s decisions to the district
court. On April 5, 2019, the court’s calendar control clerk sent a letter to the
lead attorney for each side setting briefing deadlines. The letter required C&K
Consulting to file a brief on or before April 26, 2019, and it required Ward
County to file its brief within ten days of service of C&K Consulting’s brief.
[¶3] On May 10, 2019, Ward County moved to dismiss the case. Ward County
argued that because C&K Consulting had not filed its brief and the deadline
had passed, the district court should dismiss the case pursuant to N.D.R.Ct.
11.5, which allows a court to sanction a party for violating a court rule or court
order. On May 14, 2019, C&K Consulting responded, advising the court they
had not abandoned the appeal. C&K Consulting explained the lead attorney
on the case had left the law firm representing C&K Consulting, causing
confusion within the firm. C&K Consulting stated the attorneys taking over
the file were unaware of the deadline. C&K Consulting requested the court
deny Ward County’s motion to dismiss and set a new briefing deadline.
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[¶4] On May 15, 2019, the district court granted Ward County’s motion to
dismiss, and a dismissal judgment was entered. The court found C&K
Consulting’s law firm employed approximately 275 attorneys and “[a]ttorneys
leaving and/or joining a firm of this size is a commonplace occurrence and
should not cause confusion within the firm.” The court concluded C&K
Consulting’s justification for missing the deadline was “insufficient.”
[¶5] On May 22, 2019, C&K Consulting moved for relief from the district
court’s judgment pursuant to N.D.R.Civ.P. 60(b). C&K Consulting argued
relief was warranted because, unlike notifications of all other filings in the
case, which were sent to all attorneys of record, notice of the calendar control
clerk’s letter was issued only to the lead attorney. Thus, according to C&K
Consulting, the attorneys and staff monitoring the case did not receive notice
of the briefing deadline. C&K Consulting also argued the court misapplied the
law when it did not analyze the factors required for issuance of sanctions set
out in Ringsaker v. North Dakota Workers Compensation Bureau, 2003 ND
122, ¶ 13, 666 N.W.2d 448, which Ward County’s motion to dismiss did not
address.
[¶6] On August 22, 2019, the district court denied C&K Consulting’s motion
for relief from the judgment. The court noted C&K Consulting’s response to
the dismissal motion did not raise the issue of whether the court should
analyze the Ringsaker factors. The court declined to analyze the Ringsaker
factors, reasoning that the only issue before it was “whether or not the court
properly dismissed the matter based upon the evidence and arguments made
at the time of the motion for dismissal.” On October 15, 2019, C&K Consulting
filed a notice of appeal from the dismissal order and judgments as well as the
order denying its motion for post-judgment relief.
II
[¶7] C&K Consulting argues the district court erred when it dismissed the
case as a sanction. C&K Consulting asserts dismissal as a sanction is excessive
and, “at an absolute minimum,” this Court should remand the case with
instructions for the district court to analyze the Ringsaker factors and
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reevaluate its analysis. Ward County asserts the appeal is untimely and
alternatively argues dismissal was an appropriate sanction.
A
[¶8] We first address the jurisdictional issue of whether the appeal is timely.
Ward County argues Rule 60(b) relief from the judgment is unavailable in this
case because the district court was sitting in an appellate capacity hearing an
appeal from a governmental body. Ward County argues that “[i]f Rule 60(b) is
not an available remedy in local governing body appeals, the appeal[s] should
be dismissed because they were not taken within sixty days of the district
court’s [dismissal] judgment.”
[¶9] In Lewis v. North Dakota Workers Compensation Bureau, this Court held
N.D.R.Civ.P. 60(b) was “inconsistent with the statutory appeal procedures
of the Administrative Agencies Practice Act.” 2000 ND 77, ¶ 11, 609 N.W.2d
445. We explained the North Dakota Rules of Civil Procedure apply to district
courts sitting in an appellate capacity only to the extent they are not
inconsistent with “the provisions of statutes relating to appeals to or review by
the district courts.” Id. at ¶ 7 (quoting N.D.R.Civ.P. 81(b)). The Court
reasoned that allowing a district court to grant Rule 60(b) post-judgment relief
in an administrative appeal would create a procedural inconsistency because
it would place the district court in the position of fact finder and allow it to
consider evidence that was not before the administrative agency. Id. at ¶ 11.
The Court also observed that relief similar to Rule 60(b) was available under
the Act, noting N.D.C.C. § 28-32-14 allows a party to petition the
administrative agency to reconsider a final order. Id.
[¶10] In a subsequent case, Friends of Duane Sand–2012 v. Job Service North
Dakota, 2016 ND 38, ¶ 6, 876 N.W.2d 433, we held an appeal was untimely
because it was taken from a denial of a Rule 60(b) motion, which we concluded
was a form of relief that was unavailable based on the rationale in Lewis.
Friends of Duane Sand appealed a Job Service decision to the district court.
Id. at ¶¶ 2-3. The court affirmed and entered judgment. Id. at ¶ 3. Friends of
Duane Sand moved for reconsideration under N.D.R.Civ.P. 59 and for relief
from the judgment under N.D.R.Civ.P. 60(b). Id. We applied the rationale
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from Lewis and concluded the post-judgment relief sought was not available.
Id. at ¶ 6. We therefore held the appeal was untimely:
Because [the Administrative Agencies Practice Act] only
authorizes appeals to this Court from a district court judgment
entered after appellate review of an administrative agency
decision, and because Friends of Duane Sand has appealed from
the order denying its post-judgment motion and has not timely
appealed from the district court judgment affirming the Job
Service decision, the appeal is not authorized by statute.
Id. at ¶ 7.
[¶11] Ward County argues Rule 60(b) relief is unavailable in this case because
the district court was sitting in an appellate capacity. As a result, Ward
County argues, C&K Consulting’s appeal is untimely under Friends of Duane
Sand. We disagree. This case differs in important ways from Lewis and
Friends of Duane Sand. Unlike appeals from administrative agencies under
the Administrative Agencies Practice Act, there is a limited statutory
framework for appeals from local governing bodies. Compare N.D.C.C. §§ 28-
32-42-49 with N.D.C.C. § 28-34-01. Nor is C&K Consulting seeking the type
of relief that would require the district court to shift from its appellate role to
that of a trier of fact. Rather, the Rule 60(b) relief C&K Consulting seeks is
from a procedural dismissal that was not based on the merits or facts decided
below. Thus, the rationale of Lewis and Friends of Duane Sand does not apply
here.
[¶12] Section 28-34-01, N.D.C.C., provides the procedures for appeals from
local governing bodies “to the extent that it is not inconsistent with procedural
rules adopted by the North Dakota supreme court.” The North Dakota Rules
of Civil Procedure “must govern procedure and practice to the extent these
rules are not in conflict with the statutes [relating to the appeals].”
N.D.R.Civ.P. 81(b). Given the nature of the relief C&K Consulting is seeking—
relief from a dismissal ordered for violation of procedure during the appeal
before the district court and not based on the facts or merits of the case before
the local governing body—we conclude application of Rule 60(b) in this case
would not create a procedural conflict or inconsistency.
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[¶13] Having determined Rule 60(b) relief is available, we consider the
timeliness of C&K Consulting’s appeal. C&K Consulting filed their Rule 60(b)
motion six days after the district court entered its dismissal judgment. This
tolled the 60-day time period for an appeal from the judgment. See
N.D.R.App.P. 4(a)(3)(A)(vi); see also In re Estate of Bartelson, 2013 ND 129,
¶ 12, 833 N.W.2d 522 (“if a party timely files a motion for relief under
N.D.R.Civ.P. 60 no later than 28 days after notice of entry of judgment, the full
time to file an appeal runs from service of notice of the entry of the order
disposing of the Rule 60 motion”). The district court denied C&K Consulting’s
Rule 60(b) motion on August 22, 2019. C&K Consulting filed its notice of
appeal 55 days later on October 15, 2019. Thus, C&K Consulting’s appeal from
the underlying judgment, as well as its appeal from the order dismissing its
Rule 60(b) motion, is timely.
B
[¶14] We now turn to the merits of the appeal. C&K Consulting moved the
district court for Rule 60(b) relief, arguing the court misapplied the law when
it issued a sanction without conducting the analysis required by Ringsaker.
[¶15] Rule 60(b), N.D.R.Civ.P., allows the district court to grant relief from a
final judgment when, as relevant in this case, there has been a mistake,
excusable neglect, or “any other reason that justifies relief.” Rule 60(b)
attempts to balance the conflicting principles that litigation must be brought
to an end, but justice should be done. Workforce Safety and Insurance v. Eight
Ball Trucking, Inc., 2019 ND 102, ¶ 7, 925 N.W.2d 411 (quoting Carroll v.
Carroll, 2017 ND 73, ¶ 8, 892 N.W.2d 173).
[¶16] Our review is limited to whether there is a sufficient justification for
disturbing the finality of the judgment. Eight Ball Trucking, 2019 ND 102,
¶ 7, 925 N.W.2d 411. We review the court’s decision for an abuse of discretion.
Id. An abuse of discretion occurs when the court “acts in an arbitrary,
unreasonable, or unconscionable manner, when it misinterprets or misapplies
the law, or when its decision is not the product of a rational mental process
leading to a reasoned determination.” Id. at ¶ 8 (citing Riak v. State, 2015 ND
120, ¶ 14, 863 N.W.2d 894).
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[¶17] In Ringsaker we articulated the analysis the district court must conduct
before issuing sanctions pursuant to N.D.R.Ct. 11.5 for violations of court rules
or court orders. 2003 ND 122, ¶¶ 11-13, 666 N.W.2d 448. We stated that when
issuing such sanctions, the court “must” consider a number of factors, including
the culpability of the party being sanctioned, prejudice to the other party, and
the availability of less severe alternative sanctions. Id. at ¶ 13. Because the
district court in Ringsaker only considered culpability and did not consider the
other factors, we concluded “the trial court’s analysis was incomplete and it
abused its discretion.” Id. at ¶ 14. See also Viscito v. Christianson, 2015 ND
97, ¶¶ 30-31, 862 N.W.2d 777 (remanding case when district court did not
consider less severe sanctions); Belgarde v. Askim, 2001 ND 206, ¶ 13, 636
N.W.2d 916 (court abused its discretion when it ordered sanctions without
considering the availability of less severe sanctions).
[¶18] In the present case, the district court denied C&K Consulting’s Rule
60(b) motion without analysis of the Ringsaker factors because C&K
Consulting did not direct the court to those factors in its initial response to
Ward County’s motion to dismiss. However, the party requesting sanctions
ordinarily “bear[s] the initial burden to address the relevant factors and
apprise [the] court of the relevant law.” DeepGulf Inc. v. Moszkowski, 333
F.R.D. 249, 255 (N.D. Fla. 2019) (movant for sanctions did not carry its burden
when it failed to “provid[e] essential information that this court must consider
to address a motion for sanctions”). Ward County also did not identify the
requisite sanction analysis in its motion.
[¶19] We have identified a “more lenient standard” for granting Rule 60(b)
motions for cases disposed of on procedural grounds, and we have expressed a
preference for cases to be decided on the merits. Eight Ball Trucking, 2019 ND
102, ¶ 9, 925 N.W.2d 411. Applying this more lenient standard and the fact
that Ward County bore the burden of directing the district court to the relevant
analysis, we conclude the court abused its discretion when it chose not to
revisit its dismissal judgment, which was not supported by the required
Ringsaker analysis and was therefore a misapplication of the law. See
Belgarde, 2001 ND 206, ¶ 11, 636 N.W.2d 916 (ordering sanctions without
conducting complete analysis is a misapplication of the law).
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III
[¶20] We reverse the district court’s dismissal judgment and its order denying
C&K Consulting’s Rule 60(b) motion and remand with instructions for the
court to decide what sanction, if any, is appropriate under the Ringsaker
factors.
[¶21] Jerod E. Tufte
Lisa Fair McEvers
Gerald W. VandeWalle
Jon J. Jensen, C.J.
I concur in the result.
Daniel J. Crothers
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