IN THE SUPREME COURT, STATE OF WYOMING
2013 WY 77
APRIL TERM, A.D. 2013
June 21, 2013
ORO MANAGEMENT, LLC,
Appellant
(Plaintiff),
v. No. S-12-0223
R.C. MINERAL & ROCK, LLC,
Appellee
(Defendant).
Appeal from the District Court of Fremont County
The Honorable Norman E. Young, Judge
Representing Appellant:
William L. Miller, Miller and Fasse, P.C., Riverton, Wyoming.
Representing Appellee:
Joel M. Vincent, Vincent and Vincent, Riverton, Wyoming.
Before KITE, C.J., and HILL, VOIGT, BURKE, and DAVIS, JJ.
NOTICE: This opinion is subject to formal revision before publication in Pacific Reporter Third. Readers
are requested to notify the Clerk of the Supreme Court, Supreme Court Building, Cheyenne, Wyoming
82002, of any typographical or other formal errors so that correction may be made before final publication in
the permanent volume.
BURKE, Justice.
[¶1] Appellant, ORO Management, LLC, (“ORO”) filed suit against Appellee, R.C.
Mineral & Rock, LLC (“R.C.”), seeking to set aside a foreclosure sale. The district court
granted summary judgment in favor of R.C. ORO challenges that decision in this appeal.
ORO contends that summary judgment was improper because R.C. failed to provide
sufficient notice of its intent to foreclose, and because a genuine issue of material fact
exists with respect to whether the published notice of foreclosure accurately stated the
amount due under the loan. We affirm.
ISSUE
[¶2] ORO presents a single issue for our review:
Did the district court [err] in gra n t i n g t h e
Defendant/Appellee’s Motion for Summary Judgment?
FACTS
[¶3] Between 2001 and 2003, Richard Mathey invested a total of $200,000.00 in ORO
Management, LLC, and became a member of the LLC along with Zane Pasma, ORO’s
managing member. After ORO ran into financial difficulties, Richard Mathey and his
wife, Randy Mathey, jointly issued a series of three loans to ORO, totaling $527,125.00,
which were secured by mortgages on “all of [ORO’s] interest” in property co-owned by
ORO and Ron Bixler.
[¶4] In 2005, the property owned by ORO and Mr. Bixler was partitioned following a
dispute between those parties. In 2006, Richard Mathey withdrew as a member of ORO
with the understanding that his capital contribution would be repaid. In 2007 and 2008,
ORO issued four $50,000 checks to Mr. Mathey. The ledger line on the first check
stated, “Richard Mathey . . . 1st dissolution installment.” The ledger line on the next three
checks stated “Partner Equity Pmt – Richard M.”
[¶5] In 2010, the Wyoming Secretary of State administratively dissolved ORO, and
Richard Mathey resigned as its registered agent. The company remained “inactive” until
after initiation of the foreclosure proceedings at issue in this case. In September, 2011,
the Matheys assigned their mortgages on the ORO property to Appellee, R.C. Mineral &
Rock, LLC. R.C. immediately began the process of foreclosing on the mortgages. R.C.
made private arrangements with Mr. Bixler to compensate him for his share of the
partitioned property.
[¶6] On September 21, 2011, R.C. sent notice of intent to foreclose via certified mail to
ORO in Green River, Wyoming, at the last known address listed with the Wyoming
1
Secretary of State. R.C. also sent a courtesy notice to Zane Pasma at his last known
address in Sheridan, Montana. However, Mr. Pasma’s name was misspelled as
“Plazma.” The notice sent to ORO was returned and marked “unable to forward, return
to sender,” and the notice sent to Mr. Pasma was returned as “unclaimed.” R.C. sent
notice to ORO and Mr. Pasma (as “Plazma”) again in October, but those notices were
also returned as “unable to forward” and “unclaimed.” R.C. did not send notice of the
foreclosure to Mr. Bixler.
[¶7] R.C. proceeded to publish notice of the foreclosure for four consecutive weeks in
the Lander Journal. A foreclosure sale was held on November 17, 2011, and R.C.
purchased the property for $825,557.78, the amount claimed due on the mortgages. ORO
made no attempt to redeem the property following the foreclosure.
[¶8] Prior to expiration of the statutory redemption period, ORO filed suit to set aside
the foreclosure, claiming that R.C. failed to comply with Wyo. Stat. Ann. § 34-4-103
because it did not provide sufficient notice of its intent to foreclose to ORO or Zane
Pasma, its managing member. In response to R.C.’s motion for summary judgment,
ORO asserted that the foreclosure sale should be set aside for the additional reason that
Mr. Bixler had not been provided with written notice of R.C.’s intent to foreclose. ORO
sought to amend its complaint accordingly. ORO also claimed that the four $50,000
checks issued to Richard Mathey were intended as mortgage payments, and that,
consequently, the published notice of foreclosure overstated the amount owed on the
mortgage debt by $200,000.
[¶9] After holding a hearing on the summary judgment motion, the district court issued
an order granting the motion. First, after noting that R.C. had not contended that
Mr. Pasma was a record owner of the property, the court determined that Mr. Pasma was
not individually entitled to notice of R.C.’s intent to foreclose and that ORO’s argument
regarding its sufficiency lacked merit. The court also determined that R.C. had complied
with the statutory notice requirements with respect to ORO by sending notice via
certified mail, return receipt requested, to the most recent corporate address listed with
the Wyoming Secretary of State. Next, the court determined, based on an affidavit
submitted by Ron Bixler, that Mr. Bixler had actual notice of the foreclosure
proceedings. 1 Relying on Walker v. McAnnany, 802 P.2d 876, 879 (Wyo. 1990), the
court held that strict compliance with the statutory notice requirements is unnecessary
when a party has actual notice of an intent to foreclose. Finally, the court found that the
checks issued to Richard Mathey unambiguously indicated that they were intended as
1
The court noted that, in light of its conclusion with respect to Ron Bixler’s actual notice of the
foreclosure sale, ORO’s request to amend its complaint to add the claim that the foreclosure should be set
aside because R.C. failed to notify Mr. Bixler of the sale did not need to be addressed.
2
reimbursement for Richard Mathey’s capital contributions to the LLC, rather than
payments towards the Matheys’ jointly held mortgages. ORO appeals from the district
court’s summary judgment order.
STANDARD OF REVIEW
[¶10] Because summary judgment involves a purely legal determination, we undertake
de novo review of a trial court’s summary judgment decision. Glenn v. Union Pacific
R.R. Co., 2008 WY 16, ¶ 6, 176 P.3d 640, 642 (Wyo. 2008).
Summary judgment is appropriate when there are no genuine
issues of material fact and the moving party is entitled to
judgment as a matter of law. W.R.C.P. 56(c); Metz Beverage
Co. v. Wyoming Beverages, Inc., 2002 WY 21, ¶ 9, 39 P.3d
1051, 1055 (Wyo. 2002). “A genuine issue of material fact
exists when a disputed fact, if it were proven, would establish
or refute an essential element of a cause of action or a defense
that the parties have asserted.” Id.
Jacobs Ranch Coal Co. v. Thunder Basin Coal Co., LLC, 2008 WY 101, ¶ 8, 191 P.3d
125, 128-29 (Wyo. 2008).
DISCUSSION
[¶11] ORO contends the district court erred in granting summary judgment because R.C.
failed to send notice of its intent to foreclose to Ron Bixler, a record owner of the
property encumbered by the mortgages. 2 Relying on Ulery-Williams, Inc. v. First Wyo.
Bank, N.A.-Laramie, 748 P.2d 740 (Wyo. 1988), ORO asserts that R.C.’s failure to
establish strict compliance with Wyo. Stat. Ann. § 34-4-103 renders the foreclosure sale
void. ORO also claims that summary judgment was improper because there is a genuine
issue of material fact with respect to whether the payments to Richard Mathey were
intended as loan payments, as contended by ORO, or as reimbursement to Mr. Mathey
for his capital contributions to the company, as contended by R.C. Ultimately, ORO
requests that we reverse the district court’s order granting summary judgment, and
remand to the district court with instructions that R.C. re-initiate foreclosure proceedings
against ORO.
2
ORO has abandoned its claims, asserted below, that Zane Pasma was entitled to notice of the
foreclosure, and that R.C. did not provide sufficient notice to ORO.
3
[¶12] R.C. contends that failure to provide written notice to Ron Bixler is immaterial
because R.C. gave Mr. Bixler actual notice of its intent to foreclose.3 R.C. also claims
there is no genuine issue of material fact with respect to the amount due under the loans
to ORO. First, R.C. contends the parole evidence rule bars consideration of evidence
extrinsic to the checks issued to Mr. Mathey. Second, R.C. contends that, even if the
extrinsic evidence is considered, that evidence does not create a genuine issue of material
fact. As discussed below, we agree that R.C.’s failure to send written notice to
Mr. Bixler is immaterial in light of the fact that Mr. Bixler had actual notice of R.C.’s
intent to foreclose. We also agree that ORO has failed to establish a genuine issue of
material fact.
[¶13] The prerequisites to foreclosure are set forth in Wyo. Stat. Ann. § 34-4-103
(LexisNexis 2011). That statute requires notice to be served upon the record owner of the
mortgaged property:
§ 34-4-103. Prerequisites to foreclosure.
(a) To entitle any party to give a notice as hereinafter
prescribed and to make such foreclosure, it is requisite:
...
(iv) That written notice of intent to foreclose the
mortgage by advertisement and sale has been served
upon the record owner, and the person in possession of
the mortgaged premises if different than the record
owner, by certified mail with return receipt, mailed to
the last known address of the record owner and the
3
R.C. also claims that ORO does not have standing to challenge the foreclosure on the grounds that R.C.
did not provide sufficient notice of its intent to foreclose to Mr. Bixler. As we have previously stated,
“Standing is a legal concept designed to determine whether a party is sufficiently affected to insure that
the court is presented with a justiciable controversy.” Jolley v. State Loan & Inv. Bd., 2002 WY 7, ¶ 6, 38
P.3d 1073, 1076 (Wyo. 2002). In order to establish standing, a plaintiff must demonstrate (1) a “concrete
and particularized” injury, (2) caused by the conduct complained of, and (3) that “the injury will be
redressed by a favorable decision.” Miller v. Wyo. Dep’t of Health, 2012 WY 65, ¶ 18, 275 P.3d 1257,
1261 (Wyo. 2012). R.C. concedes that “ORO has suffered an actual injury by losing its portion of the
land at issue in the foreclosure.” R.C. then attempts to argue, however, that ORO must demonstrate
“third-party standing” because “ORO is attempting to assert a purported violation of W.S. § 34-4-103 on
behalf of Mr. Bixler.” We do not agree with that proposition. Indeed, ORO asserts that its own interests
were harmed by R.C.’s failure to provide written notice to Mr. Bixler. Accordingly, because R.C. has
conceded ORO’s injury, and because its “third-party standing” analysis is inapposite, we will not address
the issue further.
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person in possession at least ten (10) days before
commencement of publication of notice of sale. Proof
of compliance with this subsection shall be by
affidavit.
[¶14] In Ulery-Williams, 748 P.2d at 740-41, notice of intent to foreclose on property
owned by Ulery-Williams, Inc. was sent to Earl and Edith Williams, officers of Ulery-
Williams, Inc., at their home address. The notice made no reference to the corporation.
Ulery-Williams filed an action to quiet its title to the mortgaged property, and the
mortgage bank defended the action by asserting that even though notice had been
erroneously sent to the Williams in their individual capacities, the corporation had actual
notice of the foreclosure proceedings, which was sufficient to satisfy the requirements of
Wyo. Stat. Ann. § 34-4-103(a)(iv). The district court agreed and granted summary
judgment in favor of the bank after finding that the irregularity in service of the notice did
not invalidate the proceedings and that Ulery-Williams, Inc. was properly notified of the
intent to foreclose. Id. at 741. On appeal, this Court indicated that Wyo. Stat. Ann. § 34-
4-103 requires strict compliance:
It is the rule in Wyoming that “[m]andatory statutes must be
obeyed, and courts have no right to make law contrary to that
prescribed by the legislature. In re Hartt’s Estate, 75 Wyo.
305, 295 P.2d 985 (1956).” Thomson v. Wyoming In-Stream
Flow Committee, Wyo., 651 P.2d 778, 787 (1982). On their
face, the provisions of § 34-4-103, W.S.1977, are mandatory.
The nature of a mandatory statute is described appropriately
by one text writer in this way:
“ . . . [B]ut where [the statute] directs acts or
proceedings to be done in a certain way and indicates
that a compliance with such provisions is essential to
the validity of the act or proceeding, or requires some
antecedent and prerequisite conditions to exist prior to
the exercise of the power, or be performed before
certain other powers can be exercised, the statute may
be regarded as mandatory.” E. Crawford, The
Construction of Statutes § 261 at 515 (1940).
In an encyclopedia and in another text, the necessity of strict
compliance with a notice requirement is emphasized.
“Whenever notice is necessary, it must appear that it
was served on the proper person, and there must be
strict compliance with a statute requiring service on a
5
particular person, so that service on another person is
not sufficient.” 66 C.J.S. Notice § 18 at 658 (1950).
“It is clear, of course, that there must be strict
compliance with a statutory provision designating
persons to whom notification is to be given.” 1 M.
Merrill, Merrill on Notice § 554 at 582 (1952).
Id. at 741-42. Ultimately, the Court held that the notice of foreclosure was insufficient:
“The actual notice to the Williams, which was not furnished to them as representatives of
the corporate appellant, does not suffice to satisfy the statutory requirement.” Id. at 742.
Importantly, however, the Court found the cases cited by the appellee involving actual
notice to the mortgagor were distinguishable “because, in those instances, actual notice
was acquired by agents of the corporation acting in that capacity.” Id.
[¶15] The decision in Ulery-Williams was distinguished in Walker, 802 P.2d 876. In
that case, Nauman-Walker, a general partnership consisting of Peter Nauman and Telford
Walker, granted a mortgage on property located in Teton County, Wyoming to Betty
McAnnany, as security for a loan. After the partnership defaulted on the loan, notice of
intent to foreclose by advertisement and sale was sent to the Nauman-Walker partnership
and to Peter Nauman and Telford Walker, by certified mail, return receipt requested, at
their last known addresses. Id. at 877-78. The notice to Mr. Walker was sent to the
address listed in a purchase agreement signed by Mr. Walker. It was returned with a
notation that Mr. Walker had moved and left no forwarding address. Id. at 878.
Ms. McAnnany subsequently foreclosed on the property securing her loan, and a
deficiency judgment was entered against Mr. Walker. On appeal, we affirmed the
deficiency judgment after finding that “the agreement in this case setting out appellant’s
address as the official address is the one which governs in the disposition in this case”
and that Ms. McAnnany was not bound by the address appearing on Mr. Walker’s motel
registration. Id. at 879. We also relied on the fact that Mr. Walker had actual notice of
the intent to foreclose:
Additionally, the record discloses that Nauman sent a copy of
the notice he had received to Walker with a note attached
inquiring whether Walker had “seen this.” Appellant thus had
actual notice from his partner.
...
There is no provision in W.S. 34-4-103(a)(iv), supra,
that prohibits actual notice of intent to foreclose other than by
mailing to the last known address of the record owner. We
find in Globe Mining Co. v. Anderson, 78 Wyo. 17, 47, 318
6
P.2d 373, 385 (1957) where it was said that “[d]efendants,
having knowledge of . . . claims, will not be heard to raise an
imperfect recordation of certificates of location as a defect of
which they can take advantage.” The court went on to say that
where there is an attempt in good faith “to comply with the
law, courts are inclined to be liberal in construing his acts so
as not to defeat his claim by technical criticism.” See also
Western Standard Uranium Company v. Thurston, 355 P.2d
377, 387 (Wyo. 1960) (quoting In re Roberts’ Estate, 58
Wyo. 438, 133 P.2d 492, 499 (1943)) where a general rule of
statutory construction is discussed wherein it was said that in
construing statutes, “‘[a] result which is . . . reasonable is
sought.’” It was noted that there was no penalty for failure to
abide by the statute.
As we visualize it, the purpose of such notice is to
afford mortgagee an opportunity to bring the indebtedness
current or take other appropriate action to avoid foreclosure.
Even if appellee had a burden of making an extensive search
for a different address for appellant, which we do not believe
she had, appellant has not shown prejudice by his having
actual notice rather than receiving a notice by certified mail.
In the case before us, there was no prohibition against
appellant having actual notice from his partner of appellee’s
intent to foreclose her mortgage and there appears no question
about the good faith of appellee. Appellant had actual notice.
It has been broadly said by the Wyoming Supreme Court that
“[t]he law is almost elementary that whatever puts a party on
inquiry amounts to ‘notice.’” Rodin v. State ex rel. City of
Cheyenne, 417 P.2d 180, 195 (Wyo. 1966).
Id.
[¶16] Based on the foregoing authority, we agree with the district court that “Strict
compliance with the notice requirement of W.S. 34-4-103 is unnecessary when a party
has actual notice of intent to foreclose.” Ulery-Williams, 748 P.2d at 742, in
distinguishing cases in which agents of the record owner have actual notice of intent to
foreclose, suggested that strict compliance with Wyo. Stat. Ann. § 34-4-103 may not be
required under all circumstances. That principle was affirmed in Walker, 802 P.2d at
879, where this Court held that nothing in Wyo. Stat. Ann. § 34-4-103(a)(iv) “prohibits
actual notice of intent to foreclose other than by mailing to the last known address of the
record owner.” As noted in Walker, the purpose of providing notice “is to afford [the]
mortgagee an opportunity to bring the indebtedness current or take other appropriate
7
action to avoid foreclosure.” Id. In this case, Mr. Bixler had actual notice of R.C.’s
intent to foreclose. Accordingly, we conclude that R.C.’s failure to send written notice of
its intent to foreclose to Mr. Bixler does not provide a legal basis to set aside summary
judgment.
[¶17] ORO also claims that summary judgment was inappropriate because there was a
genuine issue of material fact as to whether the amount of the mortgage was overstated in
the notice of intent to foreclose published in the Lander Journal. ORO’s claim is based
on an assertion, contained in an affidavit submitted by Mr. Pasma, that the four $50,000
checks issued to Mr. Mathey were intended as payments on the mortgage debt owed to
Mr. and Mrs. Mathey. Mr. Pasma’s affidavit provides, in relevant part, as follows:
It is my understanding that those payments were to be applied
toward the payment of the debt secured by [the] mortgages
referred to above. Mr. Mathey directed the book-keeper for
ORO Management, LLC on how to prepare the checks and I
signed them. Checks were sent to me in bundles and I signed
them and sent them back.
In contending that the statement contained in Mr. Pasma’s affidavit creates a genuine
issue of material fact, ORO relies on Peterson v. Johnson, 46 Wyo. 473, 28 P.2d 487
(1934), a case in which this Court set aside a foreclosure sale on the grounds that the
published notice of foreclosure overstated the actual amount due upon the mortgage debt.
[¶18] The district court, in finding that Mr. Pasma’s assertion did not create a genuine
issue of material fact, distinguished the Peterson case in its order granting summary
judgment:
ORO contends that the checks were mortgage
payments and that R.C. failed to account for those payments
in calculating the amount due under the mortgages.
Accordingly, ORO argues that the notice of foreclosure
grossly overstated the amount due, which is grounds to set
aside the sale pursuant to Peterson v. Johnson, 46 Wyo. 473,
28 P.2d 487, 491 (1934). However, that case was
significantly different from the case at bar. Unlike the
plaintiff in Peterson, ORO has made no effort to redeem the
subject property, nor has it offered to do so. Further, the
court in Peterson noted that it did not “hold that it is
absolutely necessary to state with certainty the exact amount
legally due; for a party under a mistake of law or fact, may
honestly claim more than by law he would be entitled to, and
if the other party is not shown to be prejudiced thereby, the
8
sale should not be disturbed.” Id. ORO’s reliance on
Peterson is misplaced.
The court further concluded that the checks issued to Mr. Mathey were unambiguous,
barring consideration of extrinsic evidence to interpret them, because “They were issued
by ORO to Richard Mathey, and the ledger line notations clearly indicate that the
payments were intended as something other than mortgage payments, to wit, ‘partner
equity payments’ or ‘dissolution payments.’” The court determined, however, that even
if it was at liberty to consider extrinsic evidence, that evidence did not create a genuine
issue of material fact:
Even if the Court were to conclude that the checks
were ambiguous and were to consider the extrinsic evidence
submitted by the parties, [] there is no genuine issue of
material fact as to whether the checks were intended as
mortgage payments. R.C. submits the affidavit of [Richard]
Mathey stating that he and Pasma discussed the checks and
agreed that they were to be applied to Mathey’s unsecured
capital contributions to ORO. The checks were issued in
2007 and 2008, after Mathey withdrew from ORO, and the
total amount of the payments matches the amount Mathey
claims he invested in the company. The checks were made
out to Mathey individually, not to the Matheys, who held the
mortgages as tenants by the entireties. Aside from the four
checks, ORO made no other payments to Mathey or the
Matheys, prior to or after Mathey’s withdrawal from the
company.
Aside from the assertions set forth in Pasma’s
affidavit, ORO presents no evidence that the checks were
intended as mortgage payments. Pasma states that he lacks
extensive formal education and does not understand contracts.
He alleges that he “understood” the payments were to be
applied toward the mortgages. He also “believe[s]” he made
another payment of “approximately” $57,000.00 to Mathey,
which was to be applied to the secured debt; however, ORO
provides no documentation of this alleged payment. The
party opposing summary judgment “must affirmatively set
forth material, specific facts in opposition to a motion for
summary judgment, and cannot rely only upon allegations
and pleadings . . . , and conclusory statements or mere
opinions are insufficient to satisfy the opposing party’s
burden.” Hatton v. Energy Elec. Co., 2006 WY 151, ¶ 9, 148
9
P.3d 8, 12-13 (Wyo. 2006). In Wyoming, “[a] party’s
subjective intent is not relevant” in interpreting a contract or
instrument. Hunter v. Reece, 2011 WY 97, ¶ 16, 253 P.3d
497, 501 (Wyo. 2011). Pasma’s assertions are insufficient to
raise a genuine issue of material fact on this issue. R.C. is
entitled to summary judgment.
[¶19] We agree with the district court’s reasoning on this issue, and we note that ORO,
which devotes a single paragraph of its appellate brief to its claim that the dispute over
the amount of the mortgage debt raises a genuine issue of material fact, has presented no
reason to depart from the district court’s analysis. Our review of the record confirms the
district court’s conclusion that the checks issued to Mr. Mathey were unambiguously
intended as partner dissolution payments, as stated on the checks. Further, as noted by
the district court, in contrast to the mortgagor in the Peterson case, ORO is unable to
demonstrate that the alleged overstatement of the amount due under the mortgage
resulted in prejudice. For the foregoing reasons, we conclude that ORO has not set forth
facts sufficient to establish a genuine issue of material fact. The district court properly
granted summary judgment to R.C.
[¶20] As a final matter, we must address R.C.’s request for attorneys’ fees pursuant to
W.R.A.P. 10.05. That rule provides that “If the court certifies there was no reasonable
cause for the appeal, a reasonable amount for attorneys’ fees and damages to the appellee
shall be fixed by the appellate court and taxed as part of the costs in the case.” R.C.
claims that “There was no reasonable cause for ORO’s appeal because it had conceded
every argument made by R.C.” We find no basis to conclude that ORO conceded the
issues discussed above, or that there was no reasonable cause for this appeal.
Accordingly, R.C.’s request for attorneys’ fees is denied.
[¶21] The district court’s order granting summary judgment in favor of R.C. is affirmed.
10