The Next Step v. Redmon

Summary

The North Dakota Supreme Court affirmed dismissal of The Next Step’s quiet title action. The Court held that unincorporated associations generally cannot hold title to real property because they are not legal entities, and it declined to apply exceptions based on ascertainable membership or charitable trusts to the quitclaim deed at issue. The Court concluded that the district court properly dismissed the action.

Holdings

1. An unincorporated association is incapable of holding title to real property in North Dakota because it is not a legal entity, unless a recognized exception applies.
2. Askew did not abrogate the prohibition against unincorporated associations holding title to real property; it created an equitable estoppel exception concerning whether an association may be sued when it holds itself out as a legal entity.
3. The court declined to adopt or apply an ascertainable-beneficiary exception because The Next Step did not identify its members, trustees, membership requirements, or the individuals authorized to bind the association.
4. The cy pres exception for charitable transfers to unincorporated associations does not apply to this inter vivos quitclaim deed, which did not express a charitable purpose.

Questions Presented

1. Whether an unincorporated association is capable of holding title to real property in North Dakota.
2. Whether North Dakota should recognize an exception allowing title to property conveyed to an unincorporated association to vest in ascertainable members or be held in trust for the association.
3. Whether Askew v. Joachim Memorial Home abrogated the common-law prohibition against unincorporated associations holding title to real property.

Disposition

affirmed