Minnesota Section 561.17 Waste

Waste - M.S. Section 561.17

Minnesota Section 561.17 Waste

Waste

When used with respect to real property subject to one or more life estates, legal dictionaries define the term “waste” to require:

permanent damage to real property,
which arises by reason of affirmative action taken – or a failure to take precautionary measures,
by either the holder(s) of a life estate, or the holder(s) of a term of years,
which results in loss to the holder(s) of a reversion interest or a remainder interest in the property.

See e.g., a complete definition in Black’s Law Dictionary, 7th Addition, Page 1584.

More than 100 years ago, the Minnesota Supreme Court defined “waste” in a similar context to be:

any unlawful act or omission of duty on the part of the tenant which results in permanent injury to the inheritance.

Whitney v. Huntington, 34 Minn. 458, 462, 26 N.W. 631, 632 (Minn., 1886), citing Title, “Waste,” Whart. Law Dict.; Abb. Law Dict.; Bouv. Law Dict.

Permissive Waste

In 1944, the Minnesota Supreme Court identified that the failure of a life tenant:

to make necessary and reasonable repairs to the buildings and fences located on a property, and
to pay the current property taxes when due,

constituted permissive “waste“.

Beliveau v. Beliveau, 217 Minn. 235, 243, 14 N.W.2d 360, 364 (1944).

Action For Waste – Old England

The history of the old English legal action for waste identified that it was founded in part on a “Statute of Gloucester” – adopted in the year 1278 – which provided that:

‘he which shall be attainted of waste shall lose the thing wasted, and moreover shall recompense thrice as much as the waste shall be taxed at.’

Black’s Law Dictionary, 7th Addition, Page 1584, citing Edwin E. Bryant, The Law of Pleading Under the Codes of Civil Procedure 13 (2d ed 1899).

In other words, the action allowed for both the recovery of the land in which waste had been committed, and treble damages.

Minnesota Section 561.17 Waste – Action

Some version of the English Statute of Gloucester has continuously been a part of the Minnesota Statutes since before the state was admitted to the union – the current version of which can be found in M.S. Section 561.17 – which provides in part as follows:

If a . . . tenant for life or years, . . . of real property, commits waste thereon, any person injured by the waste may bring an action against the waster therefor, in which there may be
judgment for treble damages
forfeiture of the estate of the party offending, and
eviction from the property.

Three consequences resulting from the commission of waste by the holder of a life estate were carried forward from the Statute of Gloucester to M.S. Section 561.17, including:

treble damages;
forfeiture of the estate of the wrongdoer; and
eviction from the property.

Polzin v. Aust – Minnesota Court of Appeals; 2012

In 2012, the chief judge of the Minnesota Court of Appeals – Judge Johnson – identified the historical basis for M.S. Section 561.17 in a dissenting opinion issued in an “unpublished decision” captioned as In re the Matter of: Polzin Incorporated v. James W. Aust (“Polzin v. Aust“):

The language of the statute has been in force since Minnesota attained statehood.

Polzin Inc. v. Aust (Minn App. 2012), citing Minn. Rev. Stat. (Terr.) ch. 74, §§ 16, 17 (1851); Pub. Stat. 1858, ch. 64, §§ 16, 17.

The statute is based in part on ancient English law, which authorized the forfeiture of a life estate or an estate for a term of years upon proof of waste.

Polzin Inc. v. Aust (Minn App. 2012), citing Curtiss v. Livingston, 36 Minn. 380, 382, 31 N.W. 357, 358 (1887) (citing Statute of Gloucester, 6 Edw. I, ch. 5 (1278)); see also Restatement (First) of Property § 198 cmt. a (1936).

But the forfeiture remedy was considered quite severe, and the authorizing statute fell into disuse in England and eventually was repealed in 1879.

Polzin Inc. v. Aust (Minn App. 2012), citing Mark S. Dennison, Remedies for Waste Committed by Tenant for Life or Years or by Other Party in Possession of Real Property, 47 Am. Jur. 3d Proof of Facts 399 § 4 (1998).

Accordingly, American courts generally have declined to adopt the forfeiture-for-waste remedy unless it is expressly provided by statute.

Polzin Inc. v. Aust (Minn App. 2012), citing A.E. Korpela, Annotation, Forfeiture of Life Estate for Waste, 16 A.L.R. 3d 1344, § 2 (1967); Restatement (First) of Property § 198 cmt. a (1936).

It appears that approximately half the states have enacted statutes authorizing the forfeiture-for-waste remedy.

Polzin Inc. v. Aust (Minn App. 2012), citing Restatement (Second) of Property: Landlord and Tenant § 12.2 statutory note (1977).

Some of those states have limited the applicability of the forfeiture remedy by making proof of malice a prerequisite to forfeiture, and Minnesota is among them.

Polzin Inc. v. Aust (Minn App. 2012), citing Minn. Stat. § 561.17; see also, N.D. Cent. Code § 32-17-23 (2010).

Thus, the history behind section 561.17 suggests that
the legislature intended to avoid ancient English law,
which allowed forfeiture to be ordered in every case of waste,
by imposing a higher standard of proof for the forfeiture remedy.

Polzin Inc. v. Aust (Minn App. 2012) (unpublished).

Forfeiture Requirements – Minnesota Section 561.17 Waste

The American common law requirements for forfeiture in the event that waste has been committed by the holder of a life estate have been adopted by Minnesota in M.S. Section 561.17, which provides in part as follows:

Judgment of forfeiture and eviction can only be given in favor of the person entitled to the reversion, against the tenant in possession when the injury to the estate in reversion is adjudged in the action
to be equal to the value of the tenant’s estate or unexpired term,
or
to have been done in malice.

Minnesota Section 561.17 Waste – Malice Requirement

M.S. Section 561.17 does not define the term “malice,” and prior to 2012, no appellate level Minnesota judicial decision had provided a definition of malice under the statute.

Majority Opinion – Malice Requirement

The majority opinion issued by the Minnesota Court of Appeals in Polzin v. Aust – written by Judge Huspeni – identified that the appropriate definition of malice under M.S. Section 561.17 should be as follows:

Malice “means nothing more than
the intentional doing of a wrongful act without legal justification or excuse, or . . .
the willful violation of a known right.”

Polzin Inc. v. Aust (Minn App. 2012), citing Rico v. State, 472 N.W.2d 100 (Minn. 1991), at 107 (quoting Carnes v. St. Paul Union Stockyards Co., 164 Minn. 457, 462, 205 N.W. 630, 631 (1925)).

The majority opinion in the Polzin v. Aust decision identified that the legal definition of malice with respect to M.S. Section 561.17 is objective in nature:

“Whether a wrongdoer’s motive in interfering is to benefit himself, or to gratify his spite by working mischief to another, is immaterial, malice in the sense of ill-will or spite not being essential.”

Polzin Inc. v. Aust (Minn App. 2012) (unpublished decision), citing Carnes v. St. Paul Union Stockyards Co., 164 Minn. at 462, 205 N.W. at 631-32.

According to the majority opinion, the definition of malice for purposes of M.S. Section 561.17 has three elements:

wrongful conduct,
intention to perform the conduct, and
a lack of legal justification for the conduct.

Dissenting Opinion – Malice Requirement

A strongly worded dissent issued by Judge Johnson in the Polzin v. Aust decision would have held the definition of malice identified in M.S. Section 561.17 to a higher standard of strict construction – which would create a greater burden on the plaintiff to satisfy given the forfeiture provision of the statute.

Courts have held that statutes permitting forfeiture should be strictly construed because of the severity of the remedy.

Polzin Inc. v. Aust (Minn App. 2012), citing Restatement (First) of Property § 198 cmt. b (1936); see also Roby v. Newton, 49 S.E. 694, 696 (Ga. 1905).

Likewise, forfeiture is a disfavored remedy in Minnesota if a forfeiture statute is ambiguous.

Polzin Inc. v. Aust (Minn App. 2012), citing Laase v. 2007 Chevrolet Tahoe, 776 N.W.2d 431, 439 n.10 (Minn. 2009).

As stated above, section 561.17 is ambiguous because the term “malice” has been defined by caselaw in inconsistent ways.

Polzin Inc. v. Aust (Minn App. 2012), citing Johnson, 293 Minn. at 410, 196 N.W.2d at 480.

Thus, the malice requirement of section 561.17 should be strictly construed, which requires a more stringent definition of malice.
A more stringent definition of malice also is necessary to give effect to another provision of section 561.17.
Because the term “malice” is ambiguous, we may interpret that part of the statute “in context with other provisions of the same statute.”

Polzin Inc. v. Aust (Minn App. 2012), citing In re Welfare of Children of J.B., 782 N.W.2d 535, 540 (Minn. 2010) (quotation omitted).

The first alternative means of obtaining forfeiture requires proof that the tenant’s waste is “equal to the value of the tenant’s estate or unexpired term.”

Polzin Inc. v. Aust (Minn App. 2012), citing Minn. Stat. § 561.17.

This is a relatively onerous requirement, with a legitimate economic rationale. If the owner of a future interest could obtain forfeiture under the statute’s second alternative relatively easily pursuant to a less stringent definition of malice,
that party would have no reason to invoke the statute’s first alternative,
wich effectively would make the first alternative superfluous.

In this case, the value of the waste may have been slight in comparison to the value of Aust’s estate, but Polzin avoided the issue by invoking malice.
Thus, the malice requirement of section 561.17 should be interpreted in a way that requires an additional showing so that the second alternative means of obtaining forfeiture is in balance with the first alternative. . . .
Both the grantor and grantee of a life estate are likely to place heavy reliance on the security of that property interest.
The grantee has the assurance of a place to live for the remainder of his or her life, with resulting financial benefits.
The grantor often derives satisfaction from the knowledge that, after his or her death, a loved one will be so provided for.
These reliance interests are at risk if section 561.17 allows for the easy forfeiture of a life estate in practically every case of waste.
We know from common experience that some people sometimes do not maintain their homes to the highest standards despite the best of intentions.
We should be wary of an interpretation of section 561.17 that would permit a few missing shingles, for example, to become a reason for an impatient owner of a future interest to accelerate his or her acquisition of the property.
Rather, we should insist on actual proof of malice, which was intended to ensure that the severe remedy of forfeiture was limited to appropriate cases rather than ordered in every case of waste.

Polzin Inc. v. Aust (Minn App. 2012).

In addition to a disagreement between the majority opinion and the dissenting opinion with respect to the definition of malice, the Polzin v. Aust decision was characterized by the court as “unpublished”, which means that it generally does not have precedential value when applied to other pending judicial decisions.

In other words, the Polzin v. Aust decision provides a certain degree of guidance in regards to a determination of whether waste has been committed by the holder of a life estate, but perhaps nothing more.

Conclusion – Minnesota Section 561.17 Waste

If you need assistance with respect to an issue regarding the possible commission by the holder of a life estate of M.S. Section 561.17 Waste, contact attorney Gary C. Dahle, 763-780-8390, or gary@dahlelaw.com.

Gary C. Dahle – Attorney at Law

2704 Mounds View Blvd., Mounds View, MN 55112

Phone: 763-780-8390 Fax: 763-780-1735

gary@dahlelaw.com

——— Gary C. Dahle Attorney at Law ———

Minnesota Section 561.17 Waste

Waste

Permissive Waste

Action For Waste – Old England

Minnesota Section 561.17 Waste – Action

Polzin v. Aust – Minnesota Court of Appeals; 2012

Forfeiture Requirements – Minnesota Section 561.17 Waste

Minnesota Section 561.17 Waste – Malice Requirement

Majority Opinion – Malice Requirement

Dissenting Opinion – Malice Requirement

Conclusion – Minnesota Section 561.17 Waste