District Court, West Jordan Department The Honorable James D.
Gardner No. 130405660
J. Porter, Kristen C. Kiburtz, Edward T. Wells, and David D.
Bennett, Attorneys for Appellants
N. Anderson and Scott R. Taylor, Attorneys for Appellee
Michele M. Christiansen Forster authored this Opinion, in
which Judges David N. Mortensen and Jill M. Pohlman
CHRISTIANSEN FORSTER, JUDGE.
After Lynnette Noerring and Justine Noerring (collectively,
the Noerrings) defaulted on a loan, Wells Fargo Bank, NA
(Wells Fargo) prepared to foreclose on the real property that
secured that loan. A title search revealed, however, that,
due to some missing words, the security interest in the
property had not been effectively conveyed. Wells Fargo filed
this action seeking, among other things, reformation of a
vesting deed. Following a bench trial, the court amended the
deed of trust entered into by the parties to reflect what all
parties believed they were doing at the time-creating and
conveying an enforceable deed of trust to secure the loan.
Appellants challenge that decision. We affirm.
On March 15, 2003, Lynnette created the OMI Trust,
designating herself as the trustee and her daughter, Justine,
as the sole beneficiary. The only asset placed into the trust
was the real property (the Property) at issue in this action.
Lynnette refinanced the Property several times. In each
instance, she transferred the Property by quitclaim deed from
herself, as trustee of the OMI Trust, to herself as an
individual. After executing a deed of trust on the Property
and closing the refinance, Lynnette typically conveyed the
Property back to herself, as the trustee of the OMI Trust, by
Lynnette broke from this pattern in one such iteration. In
February 2006, Lynnette executed a quitclaim deed (the 2006
Quitclaim Deed), purportedly transferring the Property to
Lynnette and Justine as individuals, which was recorded on
March 3, 2006. Instead of identifying the grantor as the
trustee of the OMI Trust-the record owner of the Property at
the time-the 2006 Quitclaim Deed instead listed the grantor
as "Lynnette Noerring, a married woman." Following
the recording of that quitclaim deed, the Noerrings
refinanced the mortgage on the Property with a loan from WMC
Mortgage Corp., which loan was secured by a trust deed, also
recorded on March 3, 2006.
Five months later, the Noerrings obtained a loan (the New
Century Note) from New Century Mortgage Corp. (New Century).
This loan satisfied the WMC loan and was, by its terms, to be
secured by a trust deed on the Property. In executing the New
Century Note, the Noerrings represented that they were title
owners of the Property. Along with the note, the Noerrings
executed several other documents at the closing,
acknowledging that the purpose of the transaction was for a
"residential mortgage loan," which entailed
providing the lender a security interest in the Property. The
New Century Trust Deed was signed by both Lynnette and
Justine and recorded on August 29, 2006. The New Century Note
was ultimately assigned to Wells Fargo as
The Noerrings later applied for and received two
modifications to the New Century Note and made payments for
approximately five years. On February 25, 2010, Lynnette passed
away. A little over a year later, Justine
defaulted on the New Century Note. A few months after the
default, Wells Fargo conducted a title search on the Property
in anticipation of foreclosure. The search revealed that the
title owner of the Property was Lynnette Noerring, as trustee
for the OMI Trust, and not Lynnette as an individual or
Lynnette and Justine as individuals.
Wells Fargo then initiated this action seeking, among other
things, reformation of the 2006 Quitclaim Deed. Specifically,
Wells Fargo sought "[a] judgment reforming the [2006
Quitclaim Deed] to reflect that Lynnette Noerring, as
trustee of the OMI Trust, conveyed the Property as the
grantor to the Noerrings, so that the Noerrings will be the
correct owner and grantor/trustor of the Property under the
[New Century Trust Deed]." (Emphasis added.) Wells Fargo
also sought an order declaring the New Century Trust Deed to
be valid and that it "encumbers and constitutes a first
priority lien against the entire Property."
Subsequently, Wells Fargo also requested that the New Century
Trust Deed be reformed to reflect that Lynnette, as trustee
of the OMI Trust, conveyed the security interest in the
Following a bench trial, the court concluded that Justine and
Lynnette, individually, and Lynnette, as trustee for the OMI
Trust, intended to grant a security interest in the Property
to New Century in order to secure the New Century Note. The
trial court found by clear and convincing evidence that the
Noerrings and New Century made a mutual mistake regarding the
New Century Trust Deed. Specifically, the court determined
that the Noerrings and New Century intended to create a valid
trust deed and convey a valid security interest in the
Property. Consequently, the trial court ordered
reformation of the New Century Trust Deed. The court changed
the grantor of the Property from Lynnette and Justine, as
individuals, to Lynnette, as trustee of the OMI Trust.
Justine and Darwin Long (collectively, Appellants) challenge
the trial court's decision.
AND STANDARDS OF REVIEW
Appellants raise three issues on appeal. First, they argue
that Wells Fargo's reformation claims are barred by the
nonclaim provisions of the Utah Uniform Trust Code and the
Utah Probate Code (collectively, the Nonclaim Statutes).
See Utah Code Ann. § 75-3-803(1) (LexisNexis
Supp. 2018); id. § 75-7-509(1).Appellants raise
this issue for the first time on appeal but assert that the
issue can be addressed despite the lack of preservation
because application of the Nonclaim Statutes present a
jurisdictional bar to Wells Fargo's claims. "As a
general rule, claims not raised before the trial court may
not be raised on appeal." State v. Holgate,
2000 UT 74, ¶ 11, 10 P.3d 346. However, "because
subject matter jurisdiction goes to the heart of a
court's authority to hear a case, it is not subject to
waiver and may be raised at any time, even if first raised on
appeal." In re adoption of Baby E.Z., 2011 UT
38, ¶ 25, 266 P.3d 702 (quotation simplified). The
applicability and interpretation of a statute is a question
of law, which we review for correctness. Fuller v.
Bohne, 2017 UT App 28, ¶ 9, 392 P.3d 898.
Second, Appellants argue that Wells Fargo's claims are
barred by the three-year statute of limitations applicable to
claims for relief on the ground of fraud or mistake. Utah
Code Ann. § 78B-2-305(3). Whether a statute of
limitations applies and whether the limitations period is
subject to tolling are questions of law. Shiozawa v.
Duke, 2015 UT App 40, ¶ 14, 344 P.3d 1174. However,
the determination of when a party reasonably should have
known the facts constituting the fraud or mistake claim is a
question of fact. Id. We will not disturb the
fact-finder's determination absent clear error. Sevy
v. Security Title Co. of S. Utah, 902 P.2d 629, 634
Third, Appellants contend that the trial court had no
authority to reform a deed by substituting a third party as
grantor, thereby creating a new deed. "Reformation of a
deed is a proceeding in equity." RHN Corp. v.
Veibell, 2004 UT 60, ¶ 35, 96 P.3d 935 (quotation
simplified). In equity actions, we review the trial
court's factual findings for clear error and its
conclusions of law for correctness. Id. We will not
overturn a trial court's formulation of an equitable