Bridgeplace Associates, L.L.C., Respondent, vs. Henry J. Lazniarz, Appellant.

Bridgeplace Associates, L.L.C., Respondent, vs. Henry J. Lazniarz, Appellant. A04-2218, Court of Appeals Unpublished, August 9, 2005.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2004).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A04-2218

 

 

Bridgeplace Associates, L.L.C.,

Respondent,

 

vs.

 

Henry J. Lazniarz,

Appellant.

 

 

Filed August 9, 2005

Affirmed; motion granted

Halbrooks, Judge

 

 

Hennepin County District Court

File No. MC 04-000595

 

 

Norman J. Baer, Kristin B. Heebner, Anthony Ostlund & Baer, P.A., 3600 Wells Fargo Center, 90 South Seventh Street, Minneapolis, Minnesota 55402 (for respondent)

 

Denis E. Grande, Joanne H. Turner, Mackall, Crounse & Moore, PLC, 1400 AT&T Tower, 901 Marquette Avenue, Minneapolis, Minnesota 55402 (for appellant)

 

 

            Considered and decided by Willis, Presiding Judge; Halbrooks, Judge; and Parker, Judge.*

U N P U B L I S H E D   O P I N I O N

HALBROOKS, Judge

            Appellant challenges the district court's grant of summary judgment to respondent on its slander-of-title claim, arguing that the district court erred in concluding that appellant's mechanic's lien was filed with malice and that appellant's conduct increased respondent's special damages.  Appellant also contends that the district court erroneously dismissed appellant's counterclaim based on incorrect determinations that (a) appellant was acting as an unlicensed real-estate broker, (b) the alleged agreement failed for lack of consideration, and (c) the claim was subject to the statute of frauds.  Because we conclude that appellant has failed to demonstrate a genuine fact issue regarding malice and failed to demonstrate prejudice regarding special damages, we affirm the district court's grant of summary judgment on the slander-of-title claim.  Because appellant failed to contest the district court's conclusion of lack of consideration in his initial brief, we deem the issue waived and, therefore, grant respondent's motion to strike that argument from appellant's reply brief.  Because we conclude that appellant was barred from receiving a commission on the sale of the property because he lacked the required real-estate-broker's license, we affirm the district court's grant of summary judgment to respondent on appellant's counterclaim.

FACTS

Appellant Henry Lazniarz is a small-scale real-estate developer who has developed approximately one dozen residential projects over the last 25 years.  Respondent Bridgeplace Associates, LLC is a Minnesota limited-liability company formed in August 2003.  The members of Bridgeplace are Robert Lux, Thomas Dillon, and Stewart Stender.  APEX Asset Management Company (APEX) is owned by Lux and Stender and has been in the business of buying, operating, and selling commercial real estate since 1994. 

In January 2003, appellant learned of the availability of an office building at 220 Second Street South in Minneapolis (the building).  Because the building's sight lines included a view of the Mississippi River, appellant envisioned converting it to condominiums.  The building was owned by a partnership affiliated with Cargill and Northco Real Estate Services (Northco).  Over the next three months, appellant, Steve Johnson, and Dale Francis met with representatives of the sellers in an attempt to finalize a deal to purchase the building. 

In February, appellant gave Aaron Barnard, a real-estate agent employed by Northco, a proposed purchase agreement for the building.  Appellant's offer was rejected, but Barnard relayed terms that the sellers would be willing to accept: a purchase price of $2.7 million, $100,000 earnest money, and 30 days' due-diligence with the earnest money to become nonrefundable at the end of the 30-day period.  In late March or early April, appellant, Johnson, and Francis submitted a new purchase agreement.  In his affidavit, Barnard stated:

As a result of that purchase offer, the sellers, [appellant], Mr. Johnson and Mr. Francis reached an agreement in principle.  The agreement was contingent upon additional terms required by the seller, including the payment of $100,000 earnest money that would become non-refundable at the end of a thirty-day due diligence period. 

 

According to appellant, "[A]fter [appellant and his partners] presented [their] last purchase agreement to [the sellers] . . . [the sellers] announced that they [were] awarding [appellant] the project," subject to the additional condition that appellant and his partners submit "$100,000 earnest money which would go hard or be nonrefundable within so many days."  Because Johnson and Francis balked at paying the earnest money, the agreement was never signed, and appellant began to search for new partners.  Barnard subsequently

learned from [appellant] that Messrs. Johnson and Francis had decided they were not willing to meet the terms required by the seller.  Mr. Francis had been the "money partner" in this group, and without him, [appellant] could not purchase the property.  [Appellant] said he would look for [a] different financial partner.  [Barnard] said that was fine, but before [he] could consider any proposal, [Barnard] would need a letter of intent or purchase agreement and information about his proposed partners.  [Barnard] also told [appellant] that [he] was going to continue marketing the property to other potential buyers. 

 

Appellant spoke with a number of people about the project, but "none of them appeared to be able to move quickly."  He also contacted Jeffrey Minea, a real-estate broker with Welsh Companies.  Appellant and Minea met and "spent about an hour discussing the idea and the project."  According to Minea, appellant told him

[t]hat he had a purchase agreement ready to be signed, but it was not signed because [appellant] needed a down payment of $100,000, and he didn't have that capability, so he was looking for a financial partner to be able to step in and . . . be able to fund the earnest money, but [appellant] had also indicated that he had been awarded the project. 

 

Minea then arranged a meeting between appellant and Lux to discuss the project.  Before being contacted by Minea, neither Lux nor his associate, Dillon, had considered investing in the building.  On April 22, 2003, appellant, Minea, Lux, and Dillon met and toured the building.  Minea noted that during the meeting, appellant "gave an overview of the numbers and what he'd done, what homework he had done or research he had done and meeting with contractors to get costs and how he had gone about that process." 

Lux and Dillon "did not like the project" proposed by appellant and "clearly indicated" that they did not wish to be appellant's partner.  But Lux did think that the property presented "an opportunity for an interesting condominium development" if both the building and an adjacent parking lot could be acquired for a reasonable price.  He told appellant that he "was only interested in both parcels."  According to Minea, when Lux asked about the parking lot, appellant told him that it was owned by a different party but that purchasing both the building and the lot was possible.  The parties then discussed the issue of compensation.  Appellant initially wanted a condominium in the new project, but Lux preferred to pay cash.  Appellant indicated that during a subsequent conversation, Lux offered him $275,000more if Lux was also able to purchase the parking lot.  Although Lux could not remember the exact amount, he recalled that "it was in the 200s, 250, $270,000."

The parties disagree regarding what appellant was to be compensated for.  According to appellant,

[Lux] was compensating me for my vision on the project and introducing him to the project, [Lux] was compensating me for taking my place on the project rather than partnering with me, and he was compensating me to use the goodwill I created with Northco and Cargill to go tell them that [Lux] was going to take my place in the project and that he very much also wanted to purchase the [parking] lot next door. 

 

When asked what appellant was "prepared to sell for $275,000," Minea likewise stated that "[appellant] was willing to deliver the relationship that he hadhad built up with the seller[.] . . .  [Appellant] had created value, and . . . was asking for compensation to deliver a project." 

Lux, in contrast, testified that he believed that he was paying appellant to acquire a legal interest that appellant held in the building.  Lux stated, "In my mind, [appellant] had one piece of property under contract.  If he was able to get the other piece of property under contract and deliver them both to us, where it didn't go out to an open bid process, we were willing to pay [appellant] a fee." 

Minea "recall[ed] very distinctly that we talked about the fact that [appellant] did not have a purchase agreement signed. . . . [W]e explained this to [Dillon] and [Lux]."  Lux agreed that appellant did not tell him that appellant had signed a purchase agreement but testified that appellant indicated that he had been "awarded the project" or "awarded the contract."  According to Lux, he understood this to mean that appellant "already had some sort of legal control over the building." 

Lux further indicated that any payment to appellant was contingent upon Lux's ability to purchase both the building and the adjacent parking lot for $3.3 million.  Respondent notes that the ultimate purchase price was $3,670,000; therefore "the condition prerequisite to Lux's purported offer to pay [appellant] was never satisfied[Lux] was not able to buy the two properties for $3.3 million."  Appellant disagrees, contending that the compensation was for conveying the $3.3 million offer, but was not contingent on Lux's ability to purchase the properties for that price.  Minea's recollection is somewhat ambiguous.

Q.        Go back to the meeting on the sidewalk.  Was there an agreement reached among the four of you about compensation?

 

A.        Yes.

 

Q.        Okay. Tell me about that[.] . . .

 

A.        The way we left it . . . was that . . . we said what we wanted, [and Lux] said what he wanted, which was two parcels of property and a price of three-million-three, and we all agreed that that's how we would move forward. . . .

 

. . . .

 

Q.        Okay. In either case it was your understanding that payment to you and payment to [appellant] was depended upon [] Lux being able to acquire these two pieces of property for a price of $3.3 million; is that right?

 

A.        Yes.

 

Q.        And if [Lux] wasn't able to acquire those two pieces of property for $3.3 million, then you didn't get paid?

 

A.        No.  No.  Iit wasn'tthat part of it was not discussed. 

 

Appellant subsequently contacted Barnard and stated that he had met with Lux, who was interested in working with appellant to acquire the building and the adjacent parking lot.  After the April 22 meeting with Lux and Dillon, appellant had no further contact with Lux, APEX, or Bridgeplace.   

A few days later, Lux was contacted by Walt Van Heest, a sales agent for Northco, inquiring about Lux's interest in the building.  Lux said that he was interested, but only if he could also buy the adjacent parking lot.  According to Lux, it was during this conversation with Van Heest that he first learned that appellant had no legal interest in the propertyno contract with the seller and no control over the site.  From that point, Lux negotiated directly with Cargill through Northco.  Cargill representatives knew Lux from approximately 20 previous business ventures between APEX and Cargill.

On April 23, appellant contacted Barnard to advise Barnard that appellant had put together "a couple of groups" with interest in the property under the previously stated terms.  Barnard responded:

1) You cannot show the building without me.  Your doing so has created confusion in the market.  Several sources have told me that you have indicated that you have the building under contract.  This must STOP as this is not true.

 

2) Cargill and [] Lux are speaking directly.  I do not have any additional information at this time.

 

3) With regard to your comments regarding your meetings with investors generating activity.  The sellers see you as a principal in the deal and not an agent.  We must clarify that you are not acting as an "agent[,"] but as a principal.  I also must further clarify that the deal that was on the table with [] Francis and [] Johnson is NO LONGER on the table.  The offer went away with the deal. 

 

On May 29, APEX submitted a letter of intent to purchase the two parcels for $3,670,000.  After further negotiations, APEX and the seller executed a purchase agreement on June 17.  APEX subsequently assigned its interest in the purchase agreement to Bridgeplace, which closed on the property on August 18, 2003. 

On December 30, 2003, appellant filed a mechanic's lien in the amount of $1,375,000 against the property purchased by Bridgeplace.  In the lien statement, appellant asserted that he was owed this amount for "labor performed or skill, material or machinery furnished to the land" in the form of "[p]lanning and [d]evelopment."  Appellant further claimed that these services were "performed or furnished from February 28, 2003 to [December 30, 2003]." 

At his deposition, appellant stated that the amount of the lien was calculated after consultation with his then-attorney, Solly Blustin.  Appellant then attempted to explain how they arrived at the $1,375,000 figure:

Q:        How much money did you believe Mr. Lux owed you when you filed this mechanic's lien on December 30th of 2003?

 

. . . .

 

A.        I believe Mr. Lux owed me $349,000.  I was advised by my attorney, Mr. Blustin, that my calculations weren't correct in determining that figure.

 

Q:        What was the basis for your determination that Mr. Lux owed you $349,000?

 

A:        Well, Mr. Lux and I agreed that he would pay me $275,000 to help him be in my place and make the purchase of the Bridgeplace building and that he would pay me more if he was also able to purchase the parking lot next-door.  If he were to purchase the Bridgeplace building for [$]2.6 million and pay me [$]275[,000], then in proportion if he were to purchase the whole site for [$]3.3[ million], . . . then in proportion that would calculate to about [$]349[,000].  Mr. Blustin didn't think that was a proper calculation of what I deserved.

 

. . . .

 

Q:        How did you arrive at $1,375,000?

 

A:        The fact that A[PEX] was able to obtain both sites allowed them to build a much larger building and have a more substantial project than just buying the single site with the existing building.  We had estimated that had we proceeded with the project on the existing building $4.5 million would have been made as a profit and the building would have been purchased for [$]2.6[ million].  Whereas if both sites were purchased, let's say for [$]3.3[ million], a larger building would be built, for example, as a 39-story building, which is what is approved now, so if one uses ratios as to what profit they would make in the large building when that's proportioned, . . . it calculates to be 1.375.

 

Q:        What calculates to be 1.375?

 

A:        . . . [I]f they're going to make [$]4.5 million in converting the existing building and they're willing to pay me [$]275[,000] to obtain the existing building[,] then they should pay me X for making a certain amount of profit in a 39-story building.

 

Q:        And what was the amount of profit that you thought they were going to make on the 39-story building?

 

A:        I don't have that on the tip of my tongue.  We had written it down somewhere and that exists, but I believe I assumed it would be a 15[-]percent profit on a certain investment . . . .  So the only missing unknown in that formula[,] or the calculation then, which I called X, calculates to be 1.375. 

 

When asked what labor he performed, or what skill, material, or machinery he furnished, appellant responded that he spent about 40 minutes discussing with Lux "the different aspects of converting the building, the engineering aspects, the design aspects, [and the] architectural aspects."  Appellant also noted that they discussed "how [] Lux would replace [appellant] in the project, would take [his] place on the project."  In addition, appellant stated that he was owed the money for "working . . . on A[PEX]'s behalf to obtain the project at the Bridgeplace site." 

On January 9, 2004, Bridgeplace sent appellant a letter demanding that he release the mechanic's lien and threatening legal action if he did not do so.  After receiving no response, Bridgeplace filed suit on January 19, alleging slander of title and tortious interference with a prospective business relationship, and attempted to serve appellant.  Approximately one week later, Bridgeplace's counsel received a letter from Blustin, stating that his firm represented appellant and inviting Bridgeplace to contact him regarding the lien.  After contacting appellant's counsel, Bridgeplace was informed that appellant had instructed the firm not to accept service on his behalf.  Bridgeplace then hired a private-investigation firm, which engaged in numerous unsuccessful attempts to personally serve appellant throughout February 2004.  On February 24, Bridgeplace served appellant by publication in accordance with Minn. R. Civ. P. 4.04(a).  Pursuant to rule 4.04(a), service became effective on March 17, 2004. 

On April 16, appellant answered and filed a counterclaim, alleging that Bridgeplace had breached an oral contract with appellant in which appellant would intercede with Cargill and Northco on behalf of Lux and his companies to effect the sale and purchase of the property.  Appellant released the mechanic's lien on the property on May 20.  Bridgeplace subsequently moved for summary judgment on its slander-of-title claim and appellant's counterclaim.  The district court granted Bridgeplace's motion in its entirety; however, the judgment was not entered due to Bridgeplace's remaining tortious-interference claim.  The district court also found that appellant had actively avoided service and awarded Bridgeplace attorney fees.  To allow an appeal to commence, the parties stipulated to dismissal of the remaining claim.  The tortious-interference claim was dismissed and judgment was entered.  This appeal follows.

D E C I S I O N

On appeal from summary judgment, this court asks (1) whether there are any genuine issues of material fact and (2) whether the district court erred in its application of law.  State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).  We review the evidence in the light most favorable to the party against whom summary judgment was granted.  Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993). 

When considering a motion for summary judgment, the district court is not to weigh the evidence or decide issues of fact; it is "solely to determine whether genuine factual issues exist."  DLH, Inc. v. Russ, 566 N.W.2d 60, 70 (Minn. 1997).  Any doubts about the existence of a genuine fact issue must be resolved in favor of its existence.  Rathbun v. W.T. Grant Co., 300 Minn. 223, 229, 219 N.W.2d 641, 646 (1974).  Nonetheless,

there is no genuine issue of material fact for trial when the nonmoving party presents evidence which merely creates a metaphysical doubt as to a factual issue and which is not sufficiently probative with respect to an essential element of the nonmoving party's case to permit reasonable persons to draw different conclusions.

 

DLH, 566 N.W.2d at 71.  Instead, the nonmoving party must show that "specific facts . . . exist which create a genuine issue for trial."  Borom v. City of St. Paul, 289 Minn. 371, 375, 184 N.W.2d 595, 597 (1971).

I.          Slander of Title

Appellant first argues that the district court erred in granting Bridgeplace's summary-judgment motion on its slander-of-title claim.

The elements required for a slander of title claim are:

 

(1) That there was a false statement concerning the real property owned by the plaintiff;

 

(2) That the false statement was published to others;

 

(3) That the false statement was published maliciously;

 

(4) That the publication of the false statement concerning title to the property caused the plaintiff pecuniary loss in the form of special damages.

 

Paidar v. Hughes, 615 N.W.2d 276, 279-80 (Minn. 2000).  Filing an inoperative document, if done maliciously, may constitute slander of title.  Id. at 280.  Appellant does not dispute that his lien statement was false or that it was published to others; rather, he argues that such publication was not malicious and that Bridgeplace suffered no special damages.  Accordingly, we address only the last two elements of the claim.

A.        Malice

Appellant contends that whether a defamatory statement was made with actual malice is a jury question and that advice of counsel is a complete defense to a claim of malicious prosecution.  The standard required to show malice in a slander-of-title case is not the same as the standard required to prove malice in an action for defamation.  See Quevli Farms, Inc. v. Union Sav. Bank & Trust Co., 178 Minn. 27, 29, 226 N.W. 191, 191 (1929) (noting that the two causes of action are based on different grounds and governed by different principles).  "[An] action for slander of title . . . is not an action for defamation in any proper sense, but an action to recover as damages the pecuniary loss sustained in consequence of a malicious and groundless disparagement of the plaintiff's title or property."  Id. at 30, 226 N.W. at 192.

In a slander-of-title case, malice requires that the disparaging statements be made without a good-faith belief in their truth.  See id. (stating that the plaintiff has the burden of proving that the false statements "were made without probable cause therefor[e]"). 

The law is that a communication, to be privileged, must be made upon a proper occasion, from a proper motive, and must be based upon reasonable or probable cause. . . .  The occasion loses its privilege if the statement is in fact false, and knowledge of the falsity is brought home to the person making it.

 

Virtue v. Creamery Package Mfg. Co., 123 Minn. 45, 46-47, 142 N.W. 1136, 1136 (1913) (emphasis added) (quotation omitted).

Here, the mechanic's lien filed by appellant contains two admittedly false elementsthat he was owed $1,375,000 by Bridgeplace for "[p]lanning and [d]evelopment" services and that those services were "performed or furnished from February 28, 2003 to [December 30, 2003]."  The question is whether there is a genuine factual issue regarding whether the lien was filed without a good-faith belief in its truth.  See DLH, 566 N.W.2d at 71; Quevli Farms, 178 Minn. at 30, 226 N.W. at 192.

In an action for slander of title, the presence or absence of malice is generally a question of fact for the jury.  See Restatement (Second) of Torts § 652(2)(f) (1977) (stating that in slander-of-title cases, "the jury determines whether . . . the defendant had knowledge of the falsity of the statement or acted in reckless disregard of its truth or falsity").  "[W]here there is sufficient evidence, or where there may be a fair difference of opinion, on the issue of malice, the question whether the defendant in an action for slander of title was actuated by malice is one of fact for the jury."  50 Am. Jur. 2d Libel and Slander § 568 (2004) (emphasis added) (summarizing Restatement rules); see also Cawrse v. Signal Oil Co., 103 P.2d 729, 731 (Or. 1940) (stating in a slander-of-title case that "[w]here different reasonable inferences can be drawn from the evidence on [the issue of malice], the question is for the jury to decide").  Likewise, although the district court determines what circumstances are necessary to establish a defense to slander of title, whether or not those circumstances exist is for the jury to decide.  See Restatement (Second) of Torts § 652(1)(e), (2)(i) (1977) (stating that in slander-of-title cases, the court determines "what circumstances are necessary to create a privilege[,]" while the jury determines "whether . . . the circumstances necessary to create a privilege existed").  Here, we must first determine whether appellant has asserted a potentially viable defense and, if so, whether there is a genuine fact issue regarding the presence or absence of circumstances establishing that defense.

Appellant stated that when he filed the mechanic's lien, he "believe[d] Mr. Lux owed [him] $349,000[, but] was advised by [his] attorney, Mr. Blustin, that [his] calculations weren't correct in determining that figure."  He then asserted that he arrived at the $1,375,000 figure after consulting with Blustin and applying a "formula" based on the presumed profit that Bridgeplace was going to realize on a 39-story condominium project. 

Appellant argues that reliance on the advice of counsel is a complete defense to a slander-of-title action.  The district court implicitly rejected this argument, finding that "[t]he fact that [appellant], on the advice of his attorney . . . , artificially inflated the value of the claimed lien . . . also evidences malice in this case."  (Emphasis added.)  Appellant correctly observes that this is an issue that has not been previously addressed in Minnesota, but cites Verspyck v. Franco, 841 A.2d 267 (Conn. App. Ct. 2004), rev'd on other grounds, 874 A.2d 249 (Conn. June 14, 2005), and the Restatement (Second) of Torts § 675 (1977) for support.  He also notes that Minnesota law currently recognizes advice of counsel as a defense to a claim of malicious prosecution, see, e.g., Miller v. Am. Nat'l Bank, 216 Minn. 19, 23, 11 N.W.2d 655, 657 (1943) (stating that "where a person states fully and fairly to an attorney all the facts known to him and is advised that such facts warrant a criminal prosecution, and[] act[s] in good faith in reliance on such advice, . . . he has a complete defense to an action for malicious prosecution"), and argues that slander-of-title actions present analogous circumstances. 

Bridgeplace argues that appellant's reliance on Verspyck and section 675 of the Restatement is misplaced because those authorities address reliance on advice of counsel in the context of malicious prosecution rather than slander of title.  Although this is true, there are cases in other jurisdictions that do address this issue in a slander-of-title context.  See, e.g., Lone v. Brown, 489 A.2d 1192, 1197 (N.J. Super. Ct. App. Div. 1985) (noting in a slander-of-title action, that "[r]eliance on the advice of counsel who has knowledge of the facts creates an absolute defense to a claim of malicious use of process"); Rowland v. Lepire, 662 P.2d 1332, 1335 (Nev. 1983) (stating in the context of a slander-of-title claim, that "evidence of a defendant's reliance on the advice of counsel tends to negate evidence of malice"); Alhambra Consol. Mines v. Alhambra Shumway Mines, Inc., 49 Cal. Rptr. 38, 44 (Cal. Dist. Ct. App. 1966) (noting that where a defendant fully and fairly disclosed facts to counsel, advice of counsel "can constitute a complete defense to charges of bad faith and malice" in an action for slander of title).  Moreover, the law regarding malicious prosecution provides a valid framework within which to analyze an advice-of-counsel defense.

The decision of the Indiana Court of Appeals in Harper v. Goodin, 409 N.E.2d 1129 (Ind. Ct. App. 1980), is particularly instructive.  In Harper, the defendant subcontractor filed a mechanic's lien on the plaintiffs' property when he became concerned that he would not be paid by the builder.  Id. at 1132.  Even though he was subsequently paid, the defendant refused to release the lien.  Id.  When the plaintiffs sued for slander of title, the defendant argued that there was no showing of malice where it had "filed the lien and refused to release it after payment upon advice of counsel."  Id. at 1134.  After noting that it could find no cases directly on point, the court stated:

[W]e believe the rule applied in malicious prosecution actions is applicable.  In those actions, the mere fact that a party procures and acts upon the advice of an attorney so obtained does not, of itself, exempt him from liability or afford absolute justification for the prosecution.  It is merely competent evidence tending to rebut malice and want of probable cause.  Such advice, to afford any protection, must be given upon a full and true statement of all the facts within the knowledge of the person seeking the advi[c]e, and must be acted upon in good faith and for an honest purpose.

 

Id. (emphasis added) (citation omitted).  The court then affirmed the judgment against the defendant, finding that evidence of advice of counsel was before the jury and that the jury could logically infer malice from that evidence.  Id. at 1135.  Accordingly, reliance on advice of counsel by a defendant in a slander-of-title action, although not conclusive, is evidence of good faith and probable cause, where the defendant has "fully and fairly" informed counsel of all relevant facts known to the defendant.  Cf. Miller, 216 Minn. at 23, 11 N.W.2d at 657 (applying advice-of-counsel defense to malicious-prosecution claim). 

The district court thus erred in implicitly rejecting appellant's advice-of-counsel defense.  But this does not end the inquiry.  We must consider whether there is a genuine fact issue regarding whether appellant fully and fairly informed his counsel of all the relevant facts and acted in good faith.

For a mechanic's lien to be valid, it must be filed within 120 days after completion of the work.  Minn. Stat. § 514.08, subd. 1 (2004); see also David-Thomas Cos. v. Voss, 517 N.W.2d 341, 343 (Minn. App. 1994) (stating that "the timing requirement of section 514.08 is strictly construed so that failure to file the lien statement within 120 days after completion of the work defeats the lien").  The district court concluded that when he filed his lien statement, appellant, "as a matter of law, had no good faith belief that he had ‘performed labor or furnished skill, material, or machinery' for the property through December 30, 2003 or within the previous 120 days." 

Appellant admitted at his deposition that he did little if anything after the April 22 meeting to help with the sale of the property.

Q:        What, if anything, did you do to assist Mr. Lux in his efforts to develop the Bridgeplace site after April 22nd?

 

. . . .

 

A:        I had conversations with Northco and I had conversations with Mr. Minea[,] who represented Mr. Lux.

 

. . . .

 

Q:        After April 22nd with whom did you have contacts at Northco?

 

A:        Mr. Barnard.

 

. . . .

 

Q:        In your contacts with Mr. Barnard[,] did you do anything to assist Mr. Lux?

 

A:        No.

 

Q:        In your contacts with Mr. Minea after April 22nd, did you do anything to assist Mr. Lux?

 

A:        I don't know.  I don't know what Mr. Minea did after I had those discussions with him. 

 

Barnard, the agent who handled the sale of the property, confirmed appellant's lack of involvement in the process:

Apart from the initial mention of Mr. Lux's name, [appellant] had absolutely no role in the sale to APEX/Bridgeplace . . . .  In fact, throughout the period when we were negotiating the sale to APEX, [appellant] continually asked to show the vacant office building to other prospective financial partners and persisted in telling me that he remained interested in acquiring the [building]. . . . [Appellant] certainly never had a legal interest in the property and the transaction with APEX was certainly not a result of any effort on [appellant's] part. 

 

Despite this, and after consulting with his attorney, appellant claimed on the mechanic's lien that he had performed or furnished services to Bridgeplace "from February 28, 2003 to [December 30, 2003]."  For the lien to be valid, appellant must have completed work for Bridgeplace on or after September 1, 2003120 days prior to the date he filed the lien.  See Minn. Stat. § 514.08, subd. 1 (stating the 120-day limitations period).  But the record contains no evidence that appellant furnished any services on or after this date.  Even if appellant was acting on the advice of counsel, he has presented no evidence that he fully and fairly informed his attorney of all the relevant facts or that he had a good-faith belief that he had furnished services to Bridgeplace on or after September 1, 2003.  See Borom, 289 Minn. at 375, 184 N.W.2d at 597 (noting that a party opposing summary judgment bears the burden of showing that "specific facts . . . exist which create a genuine issue for trial").  Thus there is no genuine fact issue regarding appellant's lack of good faith in the validity of the lien, and the district court did not err in finding malice as a matter of law.  Because we find malice with respect to the statement of dates on which work was performed, we need not address the issue of malice with respect to the lien amount.

B.        Special Damages.

Appellant also contends that the district court erred by awarding Bridgeplace special damages of $16,747.83.  Specifically, he disputes the district court's inclusion of "nearly $1,500 in fees incurred in serving" appellant, based on a finding that appellant was actively trying to avoid service.  Appellant further argues that in so doing, the district court made an impermissible assessment of appellant's credibility. 

We review a district court's award or denial of attorney fees and costs for an abuse of discretion.  Minn. Council of Dog Clubs v. City of Minneapolis, 540 N.W.2d 903, 904 (Minn. App. 1995), review denied (Minn. Jan. 25, 1996).  It is well established that reasonable attorney fees incurred as a direct consequence of an action to quiet title constitute special damages for the purposes of a slander-of-title claim.  Paidar, 615 N.W.2d at 281.  Appellant does not challenge the entire award, but argues that Bridgeplace is not entitled to "additional special damages incurred in attempting to serve him by publication when [Bridgeplace] could have served [appellant], simply and inexpensively, by mail."  Appellant further contends that the district court erred by making a factual determination regarding appellant's credibility.

Before the district court, appellant maintained that he was not attempting to avoid service, but was "in and out of town during much of the time in late January and the beginning of March 2004."  The district court found appellant's assertion "not credible, as a matter of law." 

On summary judgment, it is improper for a district court to weigh facts or determine the credibility of affidavits and other evidence.  Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S. Ct. 2505, 2511 (1986); DLH, 566 N.W.2d at 70.  Accordingly, the district court erred in finding appellant's argument "not credible."  We must now assess whether this error was prejudicial.

Appellant bears the burden of proving that an error is prejudicial.  Bloom v. Hydrotherm, Inc. 499 N.W.2d 842, 845 (Minn. App. 1993), review denied (Minn. June 28, 1993).  We will affirm a grant of summary judgment if it can be sustained on any ground.  Winkler v. Magnuson, 539 N.W.2d 821, 828 (Minn. App. 1995), review denied (Minn. Feb. 13, 1996); see also Katz v. Katz, 408 N.W.2d 835, 839 (Minn. 1987) (stating that an appellate court "will not reverse a correct decision simply because it is based on incorrect reasoning").

Here, despite being aware of Bridgeplace's concerns about the lien, appellant instructed his attorney not to accept service on appellant's behalf.  Accordingly, Bridgeplace hired a private investigation firm which "attempted to effectuate service on [appellant] on numerous occasions throughout February 2004[, but] [d]espite repeated attempts . . . was unable to" do so.[1]  Bridgeplace then concluded that appellant was attempting to avoid service and decided to serve him by publication.

Minn. R. Civ. P. 4.04(a) provides for service by publication:

(1) When the defendant is a resident individual domiciliary having departed from the state with intent to defraud creditors, or to avoid service, or remains concealed therein with the like intent;

 

. . . .

 

(4) When the subject of the action is real or personal property within the state in or upon which the defendant has or claims a lien or interest, or the relief demanded consists wholly or partly in excluding the defendant from any such interest or lien[.]

 

Minn. R. Civ. P. 4.04(a)(1), (4).  Pursuant to this rule:

The summons may be served by three weeks' published notice in any of the cases enumerated herein when the complaint and an affidavit of the plaintiff or the plaintiff's attorney have been filed with the court.  The affidavit shall state the existence of one of the enumerated cases, and that affiant believes the defendant is not a resident of the state or cannot be found therein, and either that the affiant has mailed a copy of the summons to the defendant at the defendant's place of residence or that such residence is not known to the affiant.  The service of the summons shall be deemed complete 21 days after the first publication.

 

Minn. R. Civ. P. 4.04(a).  In accordance with rule 4.04(a), Bridgeplace "mailed a copy of the [s]ummons to [appellant] at his home address and published a copy of the [s]ummons in Finance and Commerce for 21 consecutive days."[2]  Bridgeplace also filed the required affidavit with the district court.  Service became effective on March 17. 

Appellant argued to the district court that he should not be "responsible for the extra cost [Bridgeplace] spent in serving him[, because Bridgeplace] failed to include an acknowledgement in its service by mail in February[ and] chose to serve by publication, although [appellant] could be found in the state."  Appellant also contended that "between service and when [appellant] released his lien, nothing happened in this case." 

The district court reviewed Bridgeplace's claimed attorney fees and concluded that they were reasonable, stating:

16.       [Appellant] is . . . incorrect that "nothing happened" between service and when [appellant] released his lien.  After service was effectuated on March 17, 2004, [appellant] was late filing his [a]nswer and [c]ounterclaim; he failed to appear for a duly noted deposition on April 16, 2004; [Bridgeplace's attorney] began drafting a notice of motion and motion for default for his client; counsel spoke and corresponded about withdrawing the lien; [Bridgeplace's attorney] began drafting [Bridgeplace's] motion for judgment on the pleadings; there was a scheduling conference with the [district] [c]ourt on May 12, 2004; then, finally, the lien was withdrawn on May 20, 2004.  The [district] [c]ourt considers those events significant activity.

 

Appellant argues that the district court's credibility determination was "integral" to its award of attorney fees.  But the above record amply demonstrates other grounds that reasonably support the district court's award.  Therefore, the district court did not abuse its discretion in awarding Bridgeplace $16,747.83 in special damages upon summary judgment. See Winkler, 539 N.W.2d at 828.

II.        Appellant's Counterclaim.

Appellant also challenges the district court's grant of summary judgment in favor of Bridgeplace on appellant's counterclaim alleging breach of an oral contract to pay appellant to "intercede" on Bridgeplace's behalf in the sale of the property.  Specifically, appellant asserts that the district court erred by finding the counterclaim barred because (1) the alleged contract was within the statute of frauds, (2) the alleged agreement lacked consideration, and (3) appellant lacked a real-estate-broker's license.

A.        Lack of Consideration

We first address the question of lack of consideration.  Bridgeplace argues that because appellant, in his initial brief, did not challenge the district court's conclusion that the alleged agreement failed for lack of consideration, the issue is waived.  We agree.  Issues not briefed on appeal are waived.  Melina v. Chaplin, 327 N.W.2d 19, 20 (Minn. 1982).  Respondent's motion to strike is therefore granted.

Because lack of consideration is, by itself, sufficient to support the district court's grant of summary judgment, we need not reach the remaining grounds.  Nonetheless, we address them below, noting that they provide alternative support for the district court's ruling.

B.        Licensing

Appellant argues that the district court erred by concluding that appellant's claim was barred, as a matter of law, by Minn. Stat. § 82.18 (2004)[3] because appellant did not possess the required real-estate-broker's license.  When a district court grants summary judgment based on the application of a statute to undisputed facts, the result is a legal conclusion, which we review de novo.  Lefto v. Hoggsbreath Enters., 581 N.W.2d 855, 856 (Minn. 1998). 

Section 82.18 provides, in relevant part:

No person shall bring or maintain any action in the courts of this state for the collection of compensation for the performance of any of the acts for which a license is required under this chapter without alleging and proving that the person was a duly licensed real estate broker, salesperson, or closing agent at the time the alleged cause of action arose.

 

Minn. Stat. § 82.18, subd. 1.  "This section is penal in nature and will defeat a claim for commissions if a plaintiff fails to allege and prove that [he or she was] duly licensed."  Ike v. Anderson, 369 N.W.2d 321, 322 (Minn. App. 1985). 

A license is required for any person who,

for another and for commission, fee, or other valuable consideration or with the intention or expectation of receiving the same directly or indirectly lists, sells, exchanges, buys or rents, manages, or offers or attempts to negotiate a sale, option, exchange, purchase or rental of an interest or estate in real estate, or advertises or holds out as engaged in these activities.

 

Minn. Stat. § 82.17, subd. 18(a) (2004).[4]  The district court concluded that appellant's actions fell within this definition, stating, "There is no doubt that [appellant] was trying to effect a sale of the property . . . so that [he] would realize the anticipated . . . compensation."  This conclusion is supported by appellant's own characterization of his counterclaim as one for breach of an oral contract to "intercede on behalf of Lux and his companies to deal and negotiate with Lux to effect the sale and purchase of the property."          Appellant concedes that he is not licensed as a real-estate broker, salesperson, or closing agent.  He argues, however, that he is a real-estate "developer" and thus "specifically exempted from the[se] licensing requirements."  Under Minnesota law,

the term real estate broker does not include . . . any person who acquires real estate for the purpose of engaging in and does engage in, or who is engaged in the business of constructing residential, commercial or industrial buildings for the purpose of resale if no more than 25 such transactions occur in any 12-month period and the person complies with section 82.50 [concerning trust account requirements].

 

Minn. Stat. § 82.23(i) (2004)[5] (emphasis added).  Thus, to establish that he is exempt from the licensing requirement, appellant must demonstrate that he satisfies both factors listed in the statute. 

Appellant contends that he has presented evidence showing that he has not engaged in more than 25 real-estate transactions in any 12-month period.  But he makes no argument and points to nothing in the record to support a contention that he has complied with the trust-account requirements of Minn. Stat. § 82.50.  As a result, appellant has failed to establish that he was exempt from the licensing requirements. 

Because appellant failed to show that he was exempt from the licensing requirements, he cannot maintain his action for compensation on the alleged oral contract.  Therefore, the district court properly held that appellant's claim was barred as a matter of law and granted summary judgment to Bridgeplace.  See Douglas v. Shuette, 607 N.W.2d 142, 147-48 (Minn. App. 2000) (affirming district court's grant of summary judgment where the appellant failed to show that he was exempt from the broker-licensing requirements), review denied (Minn. May 16, 2000).

C.        Statute of Frauds

Finally, appellant argues that the district court erred in concluding that the alleged contract was subject to the statute of frauds.  The determination of whether the statute of frauds has been satisfied is generally a question of law, which we review de novo.  Upsher-Smith Labs. v. Mylan Labs., Inc., 944 F. Supp. 1411, 1425 (D. Minn. 1996); Simplex Supplies, Inc. v. Abhe & Svoboda, Inc., 586 N.W.2d 797, 800 (Minn. App. 1998), review denied (Minn. Feb. 24, 1999). 

Disregarding situations inapplicable in this case, the Minnesota statute of frauds provides that "[n]o estate or interest in lands, . . . nor any trust or power over or concerning lands, or in any manner relating thereto, shall hereafter be created, granted, assigned, surrendered, or declared, unless by act or operation of law, or by deed or conveyance in writing."  Minn. Stat. § 513.04 (2004).  "The word ‘interest' is the broadest term applicable to claims in or upon real estate.  In its ordinary signification among men of all classes it is broad enough to include any right, title, or estate in, or lien upon, real estate."  Hatlestad v. Mut. Trust Life Ins. Co., 197 Minn. 640, 644, 268 N.W. 665, 667 (1936) (emphasis added) (quotation omitted).  If an agreement "embraces an interest in land," it is within the statute of frauds.  Franklin Auto Body Co. v. Wicker, 414 N.W.2d 509, 513 (Minn. App. 1987) (holding that an agreement "compromising" redemption rights in real property embraced an interest in land sufficient to bring the agreement within the statute of frauds).

The district court concluded that the agreement between appellant and Bridgeplace embraced an interest in real estate and was thus subject to the statute of frauds.  We note that despite his repeated assertions that he was "awarded the project," appellant had no interest in the property and thus nothing to convey.  But if appellant had truly had any interest of the type intimated to Lux, the agreement would have been within the statute of frauds.

            Affirmed; motion granted.

*  Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10. 

[1] Appellant argues that Bridgeplace's evidence regarding the unsuccessful attempts at service are "inadmissible hearsay."  Because there is no evidence that this argument was raised before the district court, we do not address it here.  Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988).

[2] Appellant concedes that Bridgeplace sent him a copy of the summons and complaint, but notes that an acknowledgment of service was not included.  But rule 4.04(a) does not require inclusion of such an acknowledgment.  See Minn. R. Civ. P. 4.04(a). 

[3] Formerly Minn. Stat. § 82.33; renumbered as section 82.18 by 2004 Minn. Laws ch. 203, art. 2, § 61.

[4] Formerly Minn. Stat. § 82.17, subd. 4(a); renumbered as section 82.17, subd. 18(a), by 2004 Minn. Laws ch. 203, art. 2, § 61.

[5] Formerly Minn. Stat. § 82.18(i); renumbered as section 82.23(i) by 2005 Minn. Laws ch. 203, art. 2, § 61.