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You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Oates v. Holly (1/20/2012) sp-6646

Oates v. Holly (1/20/2012) sp-6646

        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, email 
        corrections@appellate.courts.state.ak.us. 

                 THE SUPREME COURT OF THE STATE OF ALASKA 

ELEANOR OAKES,                                 ) 
                                               )       Supreme Court No. S-14030 
                        Appellant,             ) 
                                               )       Superior Court No. 2NO-08-00316 CI 
        v.                                     ) 
                                               )       O P I N I O N 
DAVID and SINE HOLLY,                          ) 
                                               )       No. 6646 - January 20, 2012 
                        Appellee.              ) 
                                               ) 

                Appeal   from     the  Superior   Court    of  the  State  of   Alaska, 
                Second Judicial District, Nome, Ben Esch, Judge. 

                Appearances:   Peter      A.   Sandberg,   Wuestenfeld      &  Corey, 
                Anchorage,      for  Appellant.      Stuart  C.  Rader,    Ingaldson, 
                Maassen & Fitzgerald, P.C., Anchorage, for Appellees. 

                Before:   Carpeneti,   Chief   Justice,   Fabe,   Winfree,   Christen, 
                and Stowers, Justices. 

                PER CURIAM. 

I.      INTRODUCTION 

                 Eleanor Oakes owns a 7/8 undivided interest in a 20-acre parcel of land in 

Council, while David and Sine Holly own a 1/8 undivided interest in the property.  The 

parties went to court to partition the property, and each agreed to submit up to three 

partition proposals for the court's selection after it heard evidence about the choices.  The 

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superior   court   selected    one   of   Oakes's   proposals,   and    Oakes   hired    a  surveyor    to 

implement the division of the property. 

                The survey revealed a significant error in the map presented to the superior 

court of the selected proposal.         The error resulted in the Hollys acquiring more river 

frontage than Oakes had intended in the proposal selected by the superior court.  Oakes 

moved   to   amend   the   proposal,   but   the   Hollys   urged   that   the   selected   proposal   be 

implemented as surveyed.            The superior court concluded that under the doctrine   of 

mutual mistake,   Oakes   bore the risk of the drafting mistake in her proposals, and it 

enforced the proposal with the drafting error.             But because the error in the property 

description did not occur in the formation of contract, we conclude that the doctrine of 

mutual mistake is inapplicable. Instead, the error occurred during the evidentiary hearing 

and   formed   a   mistaken   factual   premise   for   the   trial   court's   decision. We   therefore 

remand to the superior court to determine whether it is appropriate to grant relief for 

mistake     under   Alaska    Civil   Rule   60(b),   and   if  so,  to  repartition   the  property    in 

compliance with AS 09.45.290. 

II.     FACTS AND PROCEEDINGS 

                The property at issue in this case is a 19.353-acre patented placer claim 

located in Council. The southern edge of the property is bordered by the Niukluk River. 

Eleanor Oakes owns a 7/8 undivided interest in the property while David and Sine Holly 

own a 1/8 undivided interest.        Each party has a cabin on the property. 

                On December 19, 2008, Oakes filed a complaint for judicial partition in the 

superior court.     The parties agreed that the property should be partitioned in kind; that 

the   value    of  the  property    should    be   based   on   the  raw    land,  without    regard    to 

improvements made on the property or any potential mineral deposits; and that each 

party should receive the land surrounding its own cabin.  They further agreed that each 

                                                   -2-                                             6646
 

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party would submit up to three partition proposals to the superior court and that the 

superior court's decision would be limited to selecting from among the six proposals. 

                 Each   side   submitted   three   partition   proposals.   The       proposals   differed 

chiefly   over   how   much   property   should   be   awarded   to   the   Hollys   and   where   that 

property should be located. Because of the land's topography, some parts of the property 

are   worth   more   than   others.   Specifically,   according   to   the   Hollys'   expert,   the   size, 

topography, amount of water frontage, and availability of road access all increase the 

relative value of a given proposal.  Prior to trial, Oakes stated that "[d]ue to the location 

of the Hollys' cabin [near the river], both sides agree that the Hollys will receive at least 

half of the useable riverfront." 

                 The   Hollys'   proposals   reflected   their   desire   to   retain   not   only   the   land 

immediately surrounding their cabin, but also all of the land that had historically been 

used by their family under a lease agreement with the previous owners, prior to Oakes 

and    the  Hollys    purchasing      their  respective    interests   in  the  property.    The     Hollys 

suggested that if such a partition resulted in the Hollys receiving more than 1/8 the value 
of the land, Oakes should receive owelty.1            Oakes responded that the Hollys' proposals 

would award the Hollys all of the most valuable land, while taking none of the less 

valuable land; that the Hollys' proposals would unfairly restrict Oakes's access to the 

usable river frontage; and that the land should be partitioned without resorting to owelty 
because owelty is disfavored.2          Oakes agreed to waive owelty if any of her proposals 

        1        Owelty refers to "[e]quality as achieved by a compensatory sum of money 

given after an exchange of parcels of land having different values or after an unequal 
partition of real property."       BLACK 'S LAW DICTIONARY 1214 (9th ed. 2009). 

        2        See AS 09.45.590 ("When it appears that partition cannot be made equal 

between the parties according to their respective rights, without prejudice to the rights 
and   interests   of   some   of   them,   and   a   partition  is   ordered,   the   court   may   adjudge 
                                                                                           (continued...) 

                                                    -3-                                               6646
 

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were selected, even if those proposals resulted in the Hollys receiving more than 1/8 of 

the land's value. 

                 On   July 13, 2009, after an evidentiary hearing considering the parties' 

arguments and testimony about the relative value of the partition proposals, the superior 

court selected Oakes's "Partition Proposal 1" as the most equitable, in compliance with 

AS 09.45.290.       Oakes's Proposal 1, as represented at the hearing, awarded the Hollys 

approximately   2.4   acres   of   property   starting   from   the   west   side   of   their   cabin   and 

stretching east to the eastern border of the property across the bank of Melsing Creek. 

Although this parcel contained approximately 1/8 (12.5%) of the property's acreage, the 

Hollys' appraiser testified that it was the most valuable of the six proposed parcels, 
containing about 15% of the property's value.3               In selecting this proposal, the superior 

court made findings in support of its choice: 

                         This proposal denies the [Hollys] access to all the land 
                 that was historically used when Harland Holly [the Hollys' 
                 father] was leasing, but provides some recompense due to the 
                 larger size and additional waterfront.           Also, the size of the 
                 resultant   lot   most   closely   reflects   one-eighth   of   the   larger 
                 parcel.     David      Holly    testified   that   the   portion    of  the 
                 waterfront closer to Melsing Creek more regularly floods and 
                 that   a   ditch   to   the   east   of   the   [Hollys']   present   cabin   is 
                 muddy.     However, according to the unrebutted testimony of 
                 [Oakes's son], there are mine tailings contained within this 

        2(...continued) 

compensation to be made by one party to another on account of the inequality."); see 
also 59A AM . JUR . 2D  Partition  175 (2011) ("The equalization of a partition by the 
award   of   owelty   should   not   be   resorted   to   where   it   is   possible   to   make   a   fair   and 
equitable division without it."). 

        3        The   Hollys'   appraiser   estimated   the   total   value   of   the   property   to   be 

$58,000 and the value of Oakes's Proposal 1 to be $8,700. 

                                                     -4-                                               6646
 

----------------------- Page 5-----------------------

                option     that  may    be  able   to  alleviate  some    or   all  of  the 
                problem. 

                         Selection of this option also avoids issues of possible 
                right of way encroachment for a gravel roadway that goes 
                from the river beach to a community road.   It also avoids the 
                necessity of making any owelty adjustment. According to the 
                testimony   of the   [Hollys'] expert witness, this   proposal   is 
                more     valuable    than   any   other   and    would    require   some 
                payment   to     [Oakes].     However,   [Oakes]   has   specifically 
                disclaimed any such payment. 

                Oakes arranged for a surveyor to implement the partition.  Once the survey 

was conducted, however, it became clear that Oakes's Proposal 1, as surveyed, differed 

from the visual depiction of Oakes's Proposal 1 presented to the superior court. This was 

the   result   of   two   errors   made   by   Oakes's   counsel   when   drawing   Proposal   1:   first, 

Oakes's counsel drew the southeast corner of the property further east than it is actually 

located,   and   second,   the   visual   depiction   of   the   boundary   lines   did   not   accurately 

represent the written dimensions.  The effect of these errors was that Oakes's Proposal 1, 

as surveyed, awarded the Hollys less total acreage than represented to the superior court 

(approximately 1.9 rather than 2.4 acres) but gave the Hollys much more of the desirable 

river frontage west and uphill of their cabin. 

                Throughout July and August 2009, the parties attempted to negotiate a 

solution to the mistake in the proposal, but this effort was unsuccessful.                  The parties 

returned to the superior court, and Oakes requested that the superior court adopt a revised 

partition consistent with the outline of Proposal 1 as originally drawn on the photo and 

presented to the court.   Alternatively, Oakes suggested that an award of owelty be made 

to account for the error if the court were to enforce the flawed proposal.               Oakes argued 

that her Proposal 1 as surveyed did not reflect the superior court's earlier factual findings 

and that enforcing the drafting error would give the Hollys the valuable river frontage 

                                                   -5-                                              6646
 

----------------------- Page 6-----------------------

west and uphill of their cabin that the superior court intended to award to Oakes.  The 

Hollys responded that the superior court should either award them Oakes's Proposal 1 

as surveyed or select one of the Hollys' original proposals.                The Hollys argued that 

Oakes bore the risk of mistake in drafting her proposals and that the drafting error should 

be enforced. 

                On March 15, 2010, the superior court issued an order enforcing Oakes's 

Proposal 1 as   surveyed   despite the error.         The superior court found that "[Oakes's] 

proposal   seems   to   have   differed   in   outline   drawn   on   the   photo   of   the   site   from   its 

depiction   in   dimensions."      The   superior   court   recognized   that,   because   the   parcel 

awarded to the Hollys was smaller as surveyed than as depicted in the proposal, "if [the 

Hollys] had sought some type of reformation, the court would likely have granted it." 

The   superior   court   then   went   on   to   analyze   the   drafting   error   under   the   doctrine   of 

mutual mistake. 

                The superior court viewed the parties' agreement to provide three proposals 

to the court as a contract.       The superior court then determined   that the fact that the 

proposals did not accurately represent the property due to the mistaken location of the 

southeastern corner was a mutual mistake of fact that related to a basic assumption of the 

contract and had a material effect on the agreed-upon exchange. While the superior court 

found that both parties believed the location of the corner to be further eastward than the 

survey ultimately found, the superior court concluded that Oakes, the party requesting 

relief, was responsible for and bore the risk of mistake under the doctrine of "conscious 

ignorance" due to Oakes's decision to use cheaper and less accurate methods to create 

the proposals.     Oakes's attorney conceded that he had drawn the maps himself, using 

Google Earth images, a ruler, and a calculator.  In contrast, the Hollys hired a surveyor 

and used aerial maps to derive their proposals.             In oral argument before us, Oakes's 

                                                   -6-                                             6646
 

----------------------- Page 7-----------------------

attorney admitted that his mistake was more significant than any mistake the Hollys may 

have made. 

                On July 23, 2010, Oakes filed another motion asking the superior court to 

select Oakes's Proposal 1 as intended by Oakes and requested the court stay enforcement 

of a judgment pending an appeal.           On September 7, 2010, the superior court issued a 

final   judgment   partitioning   the   property   in   accordance   with   Oakes's   Proposal   1   as 

surveyed. 

III.	   STANDARD OF REVIEW 

                We will not set aside a trial court's factual findings in a partition action 
unless those findings are clearly erroneous.4       Factual findings are only clearly erroneous 

if we are "left with a definite and firm conviction that a mistake has been made."5             "We 

review questions of law using our independent judgment and will adopt the rule of law 
that is most persuasive in light of precedent, reason, and policy."6         "Interpretation of an 

agreement between parties is a question of law   to which we   apply   our   independent 
judgment."7 

IV.	    DISCUSSION 

        A.	     The Doctrine of Mutual Mistake Is Not Applicable To The Drafting 
                Error. 

                The superior court concluded that the parties' agreement to submit up to 

three partition proposals each, and to limit the superior court's selections to the universe 

of the six proposals, was a contract.   The Hollys argued that the drafting error should be 

        4       Keenan v. Wade, 182 P.3d 1099, 1105 (Alaska 2008). 

        5       Id. 

        6       Id. (internal quotation marks omitted). 

        7       Brotherton v. Warner, 240 P.3d 1225, 1228 (Alaska 2010). 

                                                 -7-	                                          6646
 

----------------------- Page 8-----------------------

analyzed under the doctrine of mistake, and the superior court agreed.                   Although the 

parties' agreement to submit up to three proposals may have been in essence a partial 

settlement contract, we conclude that the doctrine of mutual mistake is not applicable 

because the drafting error was not a mistake that related to the formation of that contract. 

                Partitions can be accomplished through either a voluntary partition or an 
involuntary partition.8      Voluntary partitions are accomplished through contracts; the 

parties    agree   to  mutually     convey    certain   parts   of  the  property    to  one   another.9 

Involuntary partition actions are known as judicial partitions.10              Judicial partitions are 

governed by AS 09.45.290, which provides that "upon the requisite proofs being made, 

the   court   shall   order   a   partition   according   to   the   respective   rights   of   the   parties   as 

ascertained by it."     Here, the parties agreed to a judicial partition under AS 09.45.290. 

                Based on the modified procedure agreed upon by the parties, the superior 

court issued an order, on March 13, 2009, regarding procedures that memorialized the 

agreement to "offer up to three separate proposals" and clarified that "there would be an 

evidentiary hearing" during which the parties would "present evidence" after which the 

court would "select one of the proposals."  Under the agreement the superior court was 

required to choose from among proposals submitted by the parties. 

                The   superior   court   analyzed   the   discovered   drafting   error   in   Oakes's 

Proposal 1 under the doctrine of mutual mistake and ultimately allocated the risk of 

mistake to Oakes.  The doctrine of mutual mistake is a means of rescinding or reforming 

        8       4 THOMPSON ON REAL PROPERTY   38.02, 38.03 (David A. Thomas ed., 

2d ed. 2004). 

        9       Id.  38.02. 

        10      Id.  38.03(a)(1). 

                                                   -8-                                             6646
 

----------------------- Page 9-----------------------

a contract, but the doctrine is inapplicable here.11      Under the doctrine of mutual mistake, 

"[w]hen the parties to an agreement share a mistaken belief about a material fact, the 
agreement may be voidable."12         We have adopted the three requirements set forth in the 

Restatement (Second) of Contracts for determining when a mutual mistake makes a 

contract voidable: 

                The party seeking to void the contract must prove that (1) the 
                mistake relates to a basic assumption on which the contract 
                was made, (2) the mistake has a material effect on the agreed 
                exchange of performances, and (3) the party seeking relief 
                does not bear the risk of the mistake.[13] 

                Here, the superior court found that both parties were mistaken about the 

location of the southeastern corner of the property, explaining that both parties believed 
"that the larger parcel had a corner which was on the east side of Melsing Creek."14               But 

this   mistake,   which   was   reflected   in   Oakes's   Proposal   1,   did   not   relate   to   a   basic 

        11      See RESTATEMENT (SECOND) OF CONTRACTS  152 (1981) ("When Mistake 

Of Both Parties Makes A Contract Voidable"); RESTATEMENT (SECOND) OF CONTRACTS 
   155   (1981)   ("When   Mistake   Of   Both   Parties   As   To   Written   Expression   Justifies 
Reformation"); see also Old Harbor Native Corp. v. Afognak Joint Venture, 30 P.3d 101, 
108 (Alaska 2001) (discussing the requirements for reformation of a contract based on 
mutual mistake); Stormont v. Astoria Ltd., 889 P.2d 1059, 1061 (Alaska 1995). 

        12      Stormont, 889 P.2d at 1061. 

        13      Id. (citing RESTATEMENT  (SECOND) OF  CONTRACTS  152 cmt. a (1981)) 

(emphasis added, internal quotation marks omitted). 

        14      The Hollys maintain that "[t]here is no evidence that the Hollys made a 

mistaken assumption concerning the location of the southeast corner of the parcel."                  It 
is unclear how this proposition would be helpful to them since the Hollys maintain that 
the doctrine of mutual mistake should inform our analysis.                 Nevertheless, while the 
superior court found that the mistake was "mutual," at oral argument before us Oakes's 
counsel admitted that the error in Oakes's proposal was more significant because the 
Holly error in "distance is not quite so far" as that of Oakes. 

                                                  -9-                                            6646
 

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assumption of the parties' agreement to adopt procedures for resolving the litigation. 

Indeed, the contract was already fully formed when the drafting error was presented to 

the superior court.   The essentials of the contract were articulated by the superior court 

in its March 2009 procedural order:             The court would hold an evidentiary hearing at 

which   evidence   would   be   presented,   each   side   would   submit   up   to   three   separate 

proposals, and after the hearing the court would select one of the proposals. 

                 There   was   no   mistake   regarding   any   of   these   basic   provisions   of   the 

contract, or the factual premises upon which the agreement was based.                        Rather, the 

drafting error occurred nearly three months after adoption of the procedural agreement 

when Oakes's attorney, using inadequate tools, drafted and submitted the  proposals on 
June 8, 2009.15     After Oakes's Proposal 1 was chosen, the resulting survey revealed a 

mismatch between the actual parcel and the parcel intended by the superior court. 

                As Oakes argues, the error in this case casts doubt on the balancing of 

interests performed by the superior court when it chose Oakes's Proposal 1.  In choosing 

Oakes's Proposal 1, the trial court reasoned that it was the best option, even though the 

Hollys would be forced to give up their "historical" use of the land, because "the size of 

the resultant lot most closely reflects [the Hollys'] one-eighth [interest]," through its 

"larger size and additional waterfront" and this proposal "avoids issues of possible right 

of   way   encroachment   .   .   .   ." This   decision   was   premised   on   incorrect   information 

supplied to the superior court.  As a result, the superior court's findings no longer match 

its   partition   of   the   property. Although   the   parties   reached   an   agreement   as   to   the 

procedure to be used to present the right to a partition to the trial court, they did not 

waive their equitable rights under AS 09.45.290. Because the doctrine of mutual mistake 

        15      Notice of Filing Proposed Judicial Partitions,  Oakes v. Holly, Case No. 

2NO-08-316 CI, June 8, 2009. 

                                                   -10-                                                6646 

----------------------- Page 11-----------------------

is inapplicable, the allocation of risk of the mistake to Oakes is not dispositive of the 

outcome. 

        B.      The Parties May Be Entitled To Relief Under Civil Rule (60)(b)(1). 

                The   question   whether   to   grant   relief   from   drafting   errors   is   commonly 

addressed by courts under Alaska Civil Rule 60(b).               Rule 60(b)(1) permits a court to 

relieve   a   party   from   a   judgment   for   "mistake,   inadvertence,   surprise,   or   excusable 

neglect."   While "Alaska case law does not clearly pinpoint which claims for relief are 

properly cognizable under Rule 60(b)(1) . . . it appears that when a party is seeking relief 

due to the movant's mistake or neglect the claim falls under Rule 60(b)(1); but when the 
parties are mutually mistaken the claim falls under Rule 60(b)(6)."16 As the superior 

court found, the mistake in this case had a "material effect" upon the outcome of the 

case. The superior court's original findings that the Hollys would have a parcel with less 

river frontage but of a larger size, and that the partitioned lots would reflect the relative 

values of the owners' shares, seem to conflict with the newly surveyed, smaller parcel 

that allocated more waterfront to the Hollys. 

                In   an   unpublished   decision,   we   upheld   the   superior   court's   modified 

property division in response to a Rule 60(b) motion for relief because of a mistaken 
property boundary and a mistaken belief about the requirements for subdivision at trial.17 

Other courts have also considered requests for relief from mistakes made in surveyed 
parcels through a Rule 60(b)(1) analysis.18         Oakes requested relief from the trial court's 

        16      Richard v. Boggs, 162 P.3d 629, 635 (Alaska 2007) (citing  Williams v. 

Crawford, 982 P.2d 250, 255 (Alaska 1999)). 

        17      See Eckert v. Eckert, Mem. Op. & J. No. 534, 1991 WL 11657781, at *1-3 

(Alaska, Feb. 20, 1991). 

        18      See Scureman v. Judge, No. C.A. 1486-S, 1998 WL 409153, at *4 (Del. Ch. 

                                                                                        (continued...) 

                                                  -11-                                            6646
 

----------------------- Page 12-----------------------

order   based   upon   her   counsel's   drafting   mistakes   and   because   the   superior   court's 

findings in support of its partition order no longer matched the reality of the surveyed 

partitioned   parcel.   The superior court has not yet had an opportunity to review this 

question under Civil Rule 60(b).          We remand to the superior court for consideration 

whether relief from the partition order should be granted.             It will be up to the superior 

court to determine whether to invite other proposals from the parties or to revise the 

partition based on the evidence already submitted. 

                We make one last observation: The superior court expressed understandable 

concern about the discrepancy in effort and cost between the two parties given Oakes's 

use of inferior tools and methods. Oakes's drafting error has already caused considerable 

delay.   But this concern can be addressed through the award of costs and attorney's fees 
if the superior court deems a fee award appropriate.19 

        18(...continued) 

June 26, 1998) (finding negligence in challenging the error negated the Rule 60(b)(1) 
claim brought to remedy a survey error); Martin v. Schaad, No. 02CA65, 2004 WL 
57408, at *5 (Ohio App., Jan. 8, 2004) ("assuming the . . . contentions are correct that 
the boundary line contained in the survey that the court adopted does not follow the 
eastern    edge   .  .  .  then  such  an  error  is  a  'mistake'   within   the  meaning     of  Civ. 
R.  60(B)(1)"); Kunzler v. O'Dell, 855 P.2d 270, 274-75 (Utah App. 1993) (finding 
"evidence was later found to be erroneous, making the factual description of the legal 
ruling incorrect" to be a cognizable claim under Rule 60(b)); Ryan v. Harris, No. 16910- 
0-II,   1998   WL   546117,   at   *3   (Wash.   App.,   Aug.   28,   1998)   (finding   untimeliness 
foreclosed relief under a 60(b) claim brought to remedy an incorrect survey). 

        19      See Gregor v. Hodges, 612 P.2d 1008, 1010 (Alaska 1980) (finding that 

after   granting    a  60(b)   motion    for  mistake,   the  nonmoving      party   should    be  paid 
reasonable costs and attorney's fees); see also Hertz v. Berzanske, 704 P.2d 767, 773 
(Alaska 1985),partially overruled by statute as recognized by McConkey v. Hart, 930 
P.2d 402, 407 n.4 (Alaska 1996) (finding that "using the court's equitable powers" the 
costs of witnesses and attorney's fees could have been reimbursed to the nonmoving 
party    of  an  overturned     default   judgment     under   a  good    cause   standard    of  Civil 
                                                                                       (continued...) 

                                                 -12-                                            6646
 

----------------------- Page 13-----------------------

V.      CONCLUSION 

               The   doctrine   of   mutual   mistake   does   not   apply   to   the   drafting   error   in 

Oakes's Proposal 1. We remand to the superior court to determine whether the judgment 

can be set aside under Rule 60(b)(1), and if so, to partition the property in compliance 

with AS 09.45.290. 

        19(...continued) 

Rule 55(e)). 

                                                -13-                                            6646 
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