In the Matter of the Petition of Jane Serrano and Lynn Barbeau for certain relief relating to lands lying within St. Louis County, Minnesota as registered in Certificate of Title No. 328817.

This opinion is nonprecedential except as provided by
Minn. R. Civ. App. P. 136.01, subd. 1(c).

STATE OF MINNESOTA
IN COURT OF APPEALS
A21-0164

In the Matter of the Petition of Jane Serrano and Lynn Barbeau
for certain relief relating to lands lying within St. Louis County, Minnesota
as registered in Certificate of Title No. 328817.

Filed August 23, 2021
Reversed and remanded
Jesson, Judge

St. Louis County District Court
File No. 69DU-CV-19-3123

Patrick B. Steinhoff, Thomas F. DeVincke, Malkerson Gunn Martin, LLP, Minneapolis,
Minnesota (for appellants Jane Serrano and Lynn Barbeau)

Paul B. Kilgore, Fryberger, Buchanan, Smith & Frederick, P.A., Duluth, Minnesota (for
respondents Jeffery Forester and Penny Forester)

Considered and decided by Jesson, Presiding Judg e; Ross, Judge; and Smith,
Tracy M., Judge.
NONPRECEDENTIAL OPINION
JESSON, Judge
When appellants (sisters Jane Serrano an d Lynn Barbeau) sough t to refinance the
mortgage on their Lake Vermillion property, their parents co-signed the loan. To provide
their parents an interest in the property, appellants executed a quitclaim deed to themselves
and the parents as tenants in common. Altho ugh the first page did not limit the parents’
interest in the property, the second page included a “1%” notation. But certificate of title
for the Torrens property identified the parents’ interest as 50%.

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After the parents’ deaths, appellants and respondents (their other siblings) contested
their parents’ interest in the Lake Ve rmillion property in a sp ecial proceeding.
Respondents claimed that their parents had a 50% interest in the property; appellants
asserted that their parents had only a one percent interest in the property. Under the terms
of the parents’ wills, each of the four children would receive an equal share of their parents’
interest in the property, so the disputed ownership interest loomed large.
The district court granted summary judgment to respondents based on its conclusion
that the deceased father was a good-faith purchaser for value of appellants’ property despite
a claimed error in the deed. Because there are genuine issues of material fact that preclude
summary judgment, we reverse and remand to the district court for further proceedings.
FACTS
Appellants Jane Serrano and Lynn Barbeau and respondents Jeffery Forester and
Penny Forester are siblings, the children of Ba rbara and Edward Forester (the Foresters).
In 2003, appellants purchased as tenants in common two parcels of property, including a
seasonal cabin, on Lake Vermilli on. Ten years later, when appellants refinanced the
mortgage on the property, the lender required a co-signor. Their pare nts, the Foresters,
were willing to co-sign the mortgage. The mortgage lender, however, required them to
have an interest in the property in order to co-sign. As a result, appellants agreed to
quitclaim an interest in the property to the Foresters. Appellants assert that they intended
to transfer a one percent interest in the property to their parents.
Unfortunately, appellants did not seek legal help in drafting the quitclaim deed. The
deed lists “love and affecti on” as the consideration and shows a deed tax of $1.65, a

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minimum tax. But the face of the deed does not limit the Foresters’ interest in the property
to one percent. Rather, on the second page, next to the addre ss of the parcels, there is a
handwritten annotation of “1%,” which appellants allege was ad ded by Edward Forester.
The certificate (termed a “Torrens certificate of title” because the property here is Torrens
property subject to a particular statutory scheme) was issued on April 3, 2013, showing the
parties’ interests in the property as equally divided among appellants and the Foresters as
tenants in common.
Barbara Forester died on September 13, 2013 and Edward Forester died on July 31,
2014. All of Barbara’s estate passed to her husband. Respondents filed a petition for
determination of descent in the two probate matters.1 The parties agreed that the issue of
Edward Forester’s interest in the Lake Vermillion property would be reserved to a
proceeding subsequent, which is the method used to correct errors in a Torrens certificate.
Minn. Stat. § 508.71, subd. 2 (2020). Setting that issue aside, the probate court concluded
that Edward’s will left each of his children one -fourth of his estate, and, therefore, each
child had a one-fourth interest in his share of the Lake Vermillion property.
Appellants then filed a petition to resolv e the reserved issue in a separate
proceeding. Appellants sought to correct the Torrens certificate to reflect that only one
percent of the property had been transferred to the Foresters, while respondents asserted
that the Torrens certificate corre ctly showed that the proper ty was evenly divided among

1 When a person’s estate has not been probated for more than three years after the person’s
death, any interested party may ask the court to decide how the estate should be divided.
Minn. Stat. § 525.31 (2020).

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appellants and the Foresters. The district court granted respondents’ motion for summary
judgment, reasoning that the To rrens statute did not allow alte ration of the certificate of
title because the Foresters—and therefore, their heirs—were good-faith purchasers for
value. In doing so, the court noted that “had this been an action involving equitable relief,
the result might have been different.” And th e district court noted that “the evidence
submitted . . . strongly suggests that respon dents are getting more value from the subject
property than what their parents intended to receive during the mortgage refinancing
process.”
This appeal follows.
DECISION
Appellants contend that the district court erred by granting summary judgment
based on its conclusion that their deceased father was a good-faith purchaser despite a
claimed error in the deed. We review the district court’s grant of summary judgment
de novo to determine whether there are any genuine issues of material fact and whether the
district court erred in its application of the law. Montemayor v. Sebright Prods., Inc. ,
898 N.W.2d 623, 628 (Minn. 2017). In our review, we turn first to the statutory scheme at
issue here, then apply that law to the case before us.
This matter arises out of the Minnesota To rrens Act, Minnesota Statutes sections
508.01-.84 (2020). The Torrens Act provides for registration of the title to real property in
a single certificate of title, whic h is updated by the registrar of titles when a conveyance,
lien, instrument, or proceeding affects the title. In re Collier, 726 N.W.2d 799, 804 (Minn.
2007). The purpose of the Torrens system is to simplify conveyance of real property. Id.

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In theory, a person purchasing Torrens property can determine the status of the title merely
by examining the registration certificate itself, without having to resort to an extensive and
cumbersome search of all prior actions affecting title, as is required for abstract property.2
Id.
In light of the purpose of the Torrens system, i.e., that title be readily ascertainable
from the certificate,
[e]very person receiving a cer tificate of title pursuant to
a decree of registration and ev ery subsequent purchaser of
registered land who receives a certificate of title in good faith
and for a valuable consideration sha ll hold it free from all
encumbrances and adverse claims, excepting only the estates,
mortgages, liens, charges, and interests as may be noted in the
last certificate of title in the office of the registrar[,]

subject to some limited exceptions not applic able here. Minn. Stat. § 508.25 (emphasis
added). Because of this, the registrar of titles may not erase, alter, or amend an entry to a
certificate of title once it is attested, except “by order of the court or as otherwise provided
in [chapter 508].” Minn. Stat. § 508.71, subd. 1.
But the simplicity of the Torrens system is not set in stone. The statute permits the
registrar to correct clerical errors or omissions. Id., subd. 1a. And the registered owner
may also apply for a court order to correct a certificate for one of seven reasons:
(1) registered interests have terminated;

2 Under the abstract property sy stem, all documents that are re lated to a title of property,
such as transfers, dissolutions, inherita nces, foreclosures, and other actions, are
summarized in an abstract of title. Each tim e a property is transferred, all of these
documents must be examined in order to as certain whether there is marketable title.
Collier, 726 N.W.2d at 803-04.

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(2) new interests have been created;
(3) an error or omission was made when creating an entry;
(4) a person’s name has changed;
(5) a person’s marital status has changed;
(6) a corporate owner has dissolved; or
(7) “upon any reasonable ground, that any other alteration or
adjudication should be made.”
Id., subd. 2. We note that this last exception, upon any reasonable ground, significantly
expands the issues that may be litigated and serves as a basis for an exception to the Torrens
expectation that title be readily ascertainable from the certificate. In re Metro Siding, Inc.,
624 N.W.2d 303, 307-08 (Minn. App. 2001). As this court explained in Metro Siding, the
“scope of inquiry in a proceeding subsequent under Minn. Stat. § 508.71, subd. 2(7) . . . is
not limited to claims that can be resolved solely by referring to documents recorded on the
certificate of title.” Id. at 308. And we specifically concluded that “with proper notice, the
issue of the parties’ ownership interests in the property could be determined in a proceeding
subsequent.” Id.
With this Torrens statutor y backdrop in mind, we tu rn to the Lake Vermillion
property dispute before us. Here, the district court focused on the preliminary question of
whether the Foresters were purchasers in good faith and for value. The court relied upon
the following statutory language which provides that:
[t]he provisions of this section shall not give the court authority
to open the original decree of registration, and nothing shall be
done or ordered by the court which shall impair the title or

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other interest of the purchaser who holds a certificate of title
for value and in good faith , or of the purchaser’s heirs or
assigns without written consent of the purchaser or heirs or
assigns.

Minn. Stat. § 508.71, subd. 2 (emphasis added ). The district court found that appellants
and the Foresters had a “good-faith belief that only 1% of the property was transferred,”
and concluded that this made the Foresters purc hasers in good faith, and, further, that the
Foresters purchased the property for value, because they co-s igned appellants’ mortgage.
And because respondents are heirs of the Forest ers, the district cour t concluded that it
lacked authority to impair their interest in property. While th e court recognized the
potential inequity in this holding, the district court concluded it could not apply equitable
principles because the Lake Vermillion property was Torrens property.
The description of the Foresters as “good-faith purchase rs” at the summary
judgment stage is troubling. A good-faith purchaser is one who does not have “actual
knowledge of a prior, unregistered interest in the property.” Collier, 726 N.W.2d at 809.
Appellants produced evidence that the Foresters were aware that they were receiving only
one percent of the property; if so, the Fo resters knew that appellants had a prior,
unregistered interest in the 49% of the property now identified as having been transferred
to the Foresters. To some extent, this allegation is supported by the handwritten figure of
“1%” included on the deed, as well as the consideration described as “love and affection”
and the minimum deed tax of $1.65, which do es not reflect the value of a transfer of
one-half of the property. These ambiguities ra ise a question as to whether the Foresters
were good-faith purchasers of 49% of the property.

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This open question is bolstered by additional writings made by Edward Forester that
support appellants’ allegations and which the district court did not consider in reaching its
conclusion. Respondents challenge the admissibility of this evidence, but the district court
granted summary judgment without a full examination of it; there is no ruling on whether
appellants’ proffered evidence is admissible or inadmissible under the rules of evidence.
See Minn. R. Civ. P. 56.03 (summary judgment must be based on admissible evidence).
Based on the evidence identif ied by appellants, there are genuine issues of material
fact concerning whether the Foresters were good-faith purchasers of 49% of the property,
particularly when the evidence is viewed in the light most favorable to the nonmoving
party. See STAR Ctrs., Inc. v. Faegre & Benson, L.L.P. , 664 N.W.2d 72, 76-77 (Minn.
2002). Accordingly, we conclude that the grant of summary judgment was premature.
And because the district court erroneousl y concluded that the Foresters were good
faith purchasers of 49% of the Lake Vermilli on property, it did not reach the issue of
whether the statutory exceptions (including the “any reasonable ground” exception)
applied when considering the parties ownership interests. When addressing the good faith
purchaser issue on remand—as well as potentia lly reaching the statutory exceptions—we
observe that the district court may apply equita ble principles, in its discretion. While the
Torrens system strives to add certainty to property transfers, the Minnesota Supreme Court
noted that “we have applied principles of equity when a result under th e Torrens Act
violates notions of justice and good faith.” Collier, 726 N.W.2d at 808. And in In re
Mortg. Elec. Registration Sys., Inc., this court upheld the district court’s revision of a title
certificate based on oral testimony that cont radicted the written deeds, and handwritten

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notations on the purchase agreement. 835 N. W. 2d 487, 490-92, 495 (Minn. App. 2013).
We further concluded that a party may ask for amendment of a certificate of title by
showing that the party is entitled to equitable relief. Id. at 498.3
Accordingly, we reverse and remand this matter to the district court for further
proceedings consistent with this opinion.
Reversed and remanded.

3 This court explicitly recognized that equita ble principles may be applied in a Torrens
proceeding, stating: “[F]ailing to apply [equitable doctrines in a proceedin g subsequent]
would subject mortgagees to the possibility that their inte rest may be precluded by
imprecise execution and registration of the relevant documents and would limit their ability
to protect their interest through a security instrument.” Id. at 497.