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National Bank of Alaska v. Ketzler (6/6/2003) sp-5696
National Bank of Alaska v. Ketzler (6/6/2003) sp-5696
Notice: This opinion is subject to correction before
publication in the Pacific Reporter. Readers are
requested to bring errors to the attention of the Clerk
of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501, phone (907) 264-0608, fax (907) 264-0878,
e-mail corrections@appellate.courts.state.ak.us..
THE SUPREME COURT OF THE STATE OF ALASKA
NATIONAL BANK OF ALASKA, )
) Supreme Court No. S-9945
Appellant, )
) Superior Court No.
v. ) 4FA-00-141 PR
)
NANCY KETZLER, PERSONAL )
REPRESENTATIVE FOR DONALD )
KETZLER, ) O P I N I
O N
)
Appellee. ) [No. 5696 - June 6,
2003]
________________________________)
Appeal from the Superior Court of the State
of Alaska, Fourth Judicial District,
Fairbanks, Mary E. Greene, Judge.
Appearances: David J. Schmid, Law Offices of
David J. Schmid, Anchorage, for Appellant.
Richard W. Wright, Fairbanks, for Appellee.
Before: Fabe, Chief Justice, Matthews,
Eastaugh, and Carpeneti, Justices. [Bryner,
Justice, not participating.]
CARPENETI, Justice.
I. INTRODUCTION
I. Donald Ketzler executed a deed of trust in favor of the
National Bank of Alaska in order to secure a loan. After Donalds
death, his widow Nancy Ketzler moved to have the deed set aside.
The superior court ruled in favor of Nancy under AS 34.15.010,
setting aside the deed because Nancy did not join in the
conveyance and because she brought an action to set the deed
aside within the one-year period. National Bank of Alaska
appeals the decision of the superior court. Because we uphold
the superior courts interpretation of AS 34.15.010, we affirm.
II. FACTS AND PROCEEDINGS
A. Facts
Nancy and Donald were married in 1975. Beginning in
1976, the couple lived in a house Donald acquired from his
father. The Ketzlers occupied the house as their marital
residence and raised their three children there. Title to the
house was solely in Donalds name. Donald executed a will in 1983
that appointed Nancy as personal representative and left her all
of his estate.
On August 6, 1999 Donald executed a deed of trust on
the house in favor of National Bank of Alaska (NBA) in return for
a $55,000 loan. The deed contained a provision that Nancy was
required to sign in order to waive her homestead rights. The
parties have stipulated that Donald forged Nancys signature on
that portion of the deed. The deed was recorded on August 12,
1999.
On August 13, 1999 Nancy received documents from NBA
that informed her of the loan Donald had secured against the
house. Nancy promptly notified NBA that the signature on the
deed was not hers. NBA responded with a letter stating that it
would consider the document purporting to waive her homestead
rights invalid. NBA also contacted Donald and obtained
additional security on the loan including a truck and an all-
terrain vehicle. On December 25, 1999 Donald committed suicide.
After Donalds death, NBA accelerated the loan, declared it to be
in default, and sought to foreclose on the house.
B. Proceedings
A. Nancy applied for informal probate of Donalds will. She
applied for and was appointed personal representative of the
estate. Nancy then filed a motion to have the deed of trust
declared void and to enjoin the foreclosure, along with a motion
to establish exempt property and to set a family allowance. It
appears that Nancy subsequently recorded a notice of homestead.
Oral argument was heard and a recommendation made by
Standing Master Alicemary L. Closuit. Master Closuit recommended
that the superior court deny Nancys motion to have the deed
declared void. Master Closuit stated that, since Nancy had no
ownership interest in the house, the deed was still valid and NBA
could foreclose.
The superior court rejected Master Closuits
recommendations and granted Nancys motion to set the deed aside.
The superior court noted that AS 34.15.0101 requires both
spouses to join in a conveyance of the family home. However, the
court went on to note that the statute does not automatically
invalidate a deed when a spouse not appearing on the title fails
to join in the conveyance. And since Nancys name did not appear
on the title of the house, the deed was not invalid on its face.
Rather, the superior court determined that the deed could be set
aside under AS 34.15.010(d) because Nancy filed a motion to have
the deed set aside within one year of its execution. Therefore,
the superior court granted Nancys motion, and set the deed aside.
NBA appeals.
III. STANDARD OF REVIEW
We use our independent judgment in interpreting
statutes.2 The goal of statutory construction is to give effect
to the legislatures intent, with due regard for the meaning the
statutory language conveys to others.3 In interpreting statutes,
we look to the meaning of the language, the legislative history,
and the purpose of the statute in question.4 We adopt the rule
of law that is most persuasive in light of precedent, reason, and
policy. 5
IV. DISCUSSION
NBA argues that the superior court erred in finding
that AS 34.15.010 alone allowed for the setting aside of the
deed. NBA argues that AS 34.15.010(c) provides that the
requirement that a spouse join in a conveyance does not give that
spouse any interest in the property that the spouse did not
previously have. According to NBA, AS 34.15.010(d) allows for
invalidation of the deed only if the spouse that failed to join
in the deed appears on the title; the statute does nothing to
invalidate the deed if the spouse does not appear on the title.
Consequently, NBA asserts that the deed is valid and enforceable
because Nancys name does not appear on the title.
The superior court concluded that, when a spouse does
not join in the conveyance and that spouses name appears on the
title, the deed is invalid on its face under AS 34.15.010.
However, when a spouse does not appear on the title, the superior
court stated that the spouse must either file a notice of
interest with the recording district or bring an action to set
the deed aside within one year from the recording of the
conveyance to invalidate the deed under AS 34.15.010(d). In
order to determine whether the superior courts interpretation of
AS 34.15.010 is the proper interpretation, we analyze the statute
section by section.6
First, AS 34.15.010(b) provides that [i]n a deed or
conveyance of the family home or homestead by a married man or a
married woman, the husband and wife shall join in the deed or
conveyance. The statute makes no distinction between spouses
whose names appear on the title and spouses whose names do not
appear on the title. The statute unequivocally states that, if
one spouse attempts to convey the property used as the family
home, then the other spouse must, as shown by the use of the word
shall, join in the conveyance. NBA seems to agree that this is
the appropriate reading of AS 34.15.010(b).
Second, AS 34.15.010(c) provides that [t]he requirement
that a spouse of a married person join in a deed or conveyance of
the family home or homestead does not create a proprietary right,
title, or interest in the spouse not otherwise vested in the
spouse. This section supports NBAs assertion that the statute
does not give Nancy any interest in the house that she did not
previously have. The superior court agreed with this conclusion,
stating that [s]ubsection (c) would mean that a spouse who is not
on the title would not acquire title in the property simply by
joining in the other spouses conveyance of an interest in the
property. Given the language of the statute, it appears that the
legislature intended to make clear that the requirement that a
spouse join in the conveyance of a homestead interest would not
create any proprietary right, title, or interest in that spouse.
Third, AS 34.15.010(d) provides:
Failure of the spouse to join in the deed or
conveyance does not affect the validity of
the deed or conveyance, unless the spouse
appears on the title. The deed or conveyance
is sufficient in law to convey the legal
title to the premises described in it from
the grantor to the grantee when the deed or
conveyance is otherwise sufficient, and
(1) no suit is filed in a court of
record in the judicial district in which the
land is located within one year from the date
of recording of the deed or conveyance by the
spouse who failed to join in the deed or
conveyance to have the deed or conveyance set
aside, altered, changed, or reformed; or
(2) the spouse whose interest in
the property is affected does not record,
within one year in the office of the recorder
for the recording district where the property
is situated, a notice of an interest in the
property.
The first sentence of this subsection means that, if a spouse who
appears on the title does not join in a conveyance of the family
home, the conveyance is per se invalid. The second sentence
addresses the situation in which a non-titled spouse does not
join in the conveyance: the conveyance is valid and enforceable
as long as it is otherwise sufficient, that is, it meets the
requirements of subsection (a) and so long as the non-titled
spouse neither files suit to set the conveyance aside within one
year from the recording of the conveyance nor files a notice of
interest in the property within the same period. This is the way
the superior court interpreted this subsection. We agree,
provided that the interest asserted within the one-year period
has a source independent of the joinder requirement of AS
34.15.010(b).
NBA asserts that subsection (d) applies only to deeds
in which the spouses name appears on the title and that spouse
did not join in the conveyance. The bank argues that subparts
(1) and (2) of subsection (d) apply to situations in which a
spouse is named on the title and does not join in the conveyance.
NBA argues that in those situations, the deed or conveyance would
not be per se invalid; rather, the spouse would still have to
bring an action to set aside the conveyance or file a notice of
interest in the recording district in order to have the
conveyance set aside. However, as the superior court noted, this
interpretation reads subsection (b) out of the statute, as the
requirement that both untitled and titled spouses join in deeds
would be meaningless if there was no way for untitled spouses to
enforce the rights protected by that requirement by invalidating
a deed.
The use of the word unless in subsection (d) implies
that the situation in which the spouse does appear on the title
and does not join in a conveyance is the situation in which the
deed is automatically invalid. Therefore, the requirement of
either filing a suit or recording a notice of interest applies to
spouses whose names do not appear on the title. In the absence
of such a reading, the blanket requirement that a spouse join in
the conveyance in subsection (b) would be meaningless as there
would be no consequence for a spouse not joining if that spouse
does not appear on the title. Non-titled spouses can invalidate
deeds and conveyances under AS 34.15.010 in the event that they
follow the procedure set out in AS 34.15.010(d) and are asserting
a right not created by AS 34.15.010.
NBA cites the territorial Alaska case of Spracher v.
Spracher7 in support of its interpretation of AS 34.15.010.
Spracher was a divorce action in which the husband mortgaged the
homestead without the wifes signature and the wife sought to set
aside the conveyance.8 The statute at issue in Spracher was
almost identical to the statute at issue here.9 The court held
that the statute did not give the wife an interest in the
property, but this holding is inapposite in this case. The wifes
inability to invalidate the conveyance was based on the divorce,
as the court held that her homestead rights did not survive the
divorce.10
We agree that the statute does not give an untitled
spouse an interest in property. Instead, the interest asserted
must have a source independent of the statute. But our case is
different from Spracher. Here, Nancys interest in the property
survived her husband, in fact it vested with his death.11
Nancy had at least two valid interests in the property
within the scope of AS 34.15.010s protection. The interest
required for Nancy to challenge the deed is supplied by the
probate homestead allowance12 and her right to inherit the
decedents property (according to his valid will,13 by exercising
her right to an elective share of his estate,14 or through the
laws of intestate succession15). Because Donalds will left the
property to Nancy, she was entitled to inherit the decedents
interest in the home. Likewise, the probate homestead exemption
would have protected Nancys interest in the home. These
interests are not created by AS 34.15.010, but are precisely the
type of rights that AS 34.15.010 is intended to protect. The
statute protects for one year Nancys right to inherit the
property she would have been entitled to inherit in the absence
of an improperly acquired deed against that property. Because
invalidation of the deed would protect a right to inherit the
home, Nancy has the right under AS 34.15.010 to invalidate the
deed.
Because Nancy Ketzler timely took the action that the
statute provides will invalidate a deed that fails to contain the
signature of the untitled spouse in order to protect her right of
inheritance, the superior court correctly held that the banks
deed could be invalidated and proceeded to invalidate it.
Therefore, we uphold the superior courts decision to set aside
the deed of trust.
V. CONCLUSION
Because we find that the superior court properly
interpreted AS 34.15.010, we AFFIRM the setting aside of the deed
of trust.
_______________________________
1 AS 34.15.010 states:
(a) A conveyance of land, or of an
estate or interest in land, may be made by
deed, signed and sealed by the person from
whom the estate or interest is intended to
pass, who is of lawful age, or by the lawful
agent or attorney of the person, and
acknowledged or proved, and recorded as
directed in this chapter, without any other
act or ceremony whatever.
(b) In a deed or conveyance of the
family home or homestead by a married man or
a married woman, the husband and wife shall
join in the deed or conveyance.
(c) The requirement that a spouse of a
married person join in a deed or conveyance
of the family home or homestead does not
create a proprietary right, title, or
interest in the spouse not otherwise vested
in the spouse.
(d) Failure of the spouse to join in the
deed or conveyance does not affect the
validity of the deed or conveyance, unless
the spouse appears on the title. The deed or
conveyance is sufficient in law to convey the
legal title to the premises described in it
from the grantor to the grantee when the deed
or conveyance is otherwise sufficient, and
(1) no suit is filed in a court of
record in the judicial district in which the
land is located within one year from the date
of recording of the deed or conveyance by the
spouse who failed to join in the deed or
conveyance to have the deed or conveyance set
aside, altered, changed, or reformed; or
(2) the spouse whose interest in
the property is affected does not record,
within one year in the office of the recorder
for the recording district where the property
is situated, a notice of an interest in the
property.
2 Alderman v. Iditarod Props., Inc., 32 P.3d 373, 380
(Alaska 2001).
3 Tesoro Alaska Petroleum Co. v. Kenai Pipe Line Co., 746
P.2d 896, 905 (Alaska 1987).
4 Muller v. BP Exploration (Alaska) Inc., 923 P.2d 783,
787 (Alaska 1996).
5 Berger v. Wien Air Alaska, 995 P.2d 240, 242 (Alaska
2000) (quoting Williams v. Utility Equip., Inc., 837 P.2d 1112,
1117 (Alaska 1992)).
6 Our search of the legislative history uncovered nothing
that assists interpretation of the statute, and the parties have
not referred us to useful legislative history. The statute as
originally codified in 22-3-1 ACLA 1949 consisted of one
paragraph containing the provisions now codified as AS
34.15.010(a)-(b). The legislature amended the statute in 1953 to
add the text now codified as AS 34.15.010(c)-(d).
7 17 Alaska 698 (D. Alaska 1958).
8 Id. at 702-03.
9 Id. at 702.
10 Id. at 705.
11 The territorial courts opinion that the spouse in
Spracher had no interest that survived the divorce is not
necessarily consistent with contemporary legal standards. The
property in question there would be considered marital property
under todays standards because a divorce was pending and as such
would be subject to division in the divorce even though held only
in the name of the husband. Marital property is not a species of
ownership but it arguably represents a sufficient interest to
receive protection under the statute. This question is not
presented in this case and we do not resolve it here.
12 AS 13.12.402.
13 AS 13.12.501-13.12.921.
14 AS 13.12.202(a).
15 AS 13.12.102.
