Peterka v. Janda

                    IN THE SUPREME COURT
                    STATE OF NORTH DAKOTA

                                  

Jared Peterka,                                          Plaintiff and Appellant
      v.
John E. Janda and Irene C. Janda, individually
and as Co-Trustees of the John E. Janda and Irene
C. Janda Living Trust, established October 30,
2018; Jacqueline Korczak, individually, and as
co-guardian and co-conservator of John and Irene
Janda, as Successor Trustee of the John E. Janda
and Irene C. Janda, established October 30, 2018;
Loretta Grad, individually, and as co-guardian
and co-conservator of John and Irene Janda,          Defendants and Appellees
      and
Catherine Enstad,                                                    Defendant



                                 No. 20240122

Appeal from the District Court of Traill County, East Central Judicial District,
the Honorable Steven E. McCullough, Judge.

AFFIRMED.

Opinion of the Court by Tufte, Justice.

Andrew D. Cook, West Fargo, N.D., for plaintiff and appellant.

Matthew D. Kirschenmann (argued) and Michael T. Andrews (on brief), Fargo,
N.D., for defendants and appellees.
                                 Peterka v. Janda
                                  No. 20240122
Tufte, Justice.

[¶1] Jared Peterka appeals from a district court judgment denying his claim for
declaratory judgment and dismissing his complaint. On appeal, he argues the
district court clearly erred by determining his option contract was voidable
under N.D.C.C. § 14-01-02. We affirm the judgment.

                                       I

[¶2] John and Irene Janda (collectively “the Jandas”) owned farmland in Walsh
County, North Dakota, namely Section 19-156-53 (“the disputed property”).
Jacqueline Korczak, Loretta Grad, and Catherine Enstad (collectively “the
Defendants”) are the adult daughters of the Jandas. Jared Peterka was a neighbor
and tenant of the Jandas.

[¶3] Jared Peterka’s father leased the disputed property for many years. In
2012, Jared Peterka assumed the lease and began farming the land. The lease was
renewed every three years, and in 2019 a right of first refusal for Jared Peterka
to purchase the land was added to the lease. In October 2018, the Jandas
established a living trust and conveyed the disputed property into the trust. The
Defendants are the residuary beneficiaries of the trust.

[¶4] On May 20, 2021, Irene Janda was admitted into a nursing home to recover
from a broken hip. On May 25, 2021, John Janda was admitted into the
same nursing home because “he was unable to care for himself safely without
assistance.” On June 14, 2021, the Jandas and Peterka executed an option to
purchase the disputed property. On July 15, 2021, guardianship and
conservatorship proceedings were commenced on behalf of the Jandas. On
October 14, 2021, the Jandas were found to be incapacitated, and permanent
guardianships were ordered under N.D.C.C. ch. 30.1-28. Two of the Defendants
were appointed guardians. The guardians rescinded the option to purchase the
disputed property.




                                       1
[¶5] Jared Peterka filed a complaint for declaratory judgment seeking
declaration that his option to purchase the disputed property is valid and
enforceable. The Defendants answered and filed a counterclaim, arguing the
option to purchase was the result of undue influence exerted by Peterka upon
the Jandas and the Jandas lacked capacity to execute the option in June of 2021.
A four-day bench trial was held in July 2023.

[¶6] Following trial, the district court entered a memorandum opinion and
order finding the option to purchase was facially valid, not the product of undue
influence, and not void for lack of capacity. The court further found the option
to purchase was voidable under N.D.C.C. § 14-01-02, and the option was voided
when the Defendants rescinded the option to purchase. The court denied
Peterka’s request for declaratory judgment and dismissed his complaint.
Judgment was entered. Peterka appeals.

                                         II

[¶7] Peterka argues the district court’s findings on capacity are clearly
erroneous because they are induced by an erroneous view of the law. He argues
the court’s finding that the Jandas had capacity to enter into the option to
purchase precludes a finding that the Jandas were of unsound mind, but
not entirely without understanding under N.D.C.C. § 14-01-02. He argues the
capacity to enter into a contract is the same capacity contemplated in N.D.C.C.
§ 14-01-02.

[¶8] “A district court’s finding on capacity, or lack of capacity, is a question of
fact.” Vig v. Swenson, 

, 

; see also Slorby v. Johnson,

 (N.D. 1995) (“findings concerning capacity and competency
are questions of fact which will not be overturned on appeal unless they are
clearly erroneous under N.D.R.Civ.P. 52(a)”). “We will not set aside a district
court’s finding of fact unless it is clearly erroneous.” Vig, ¶ 14 (citing
N.D.R.Civ.P. 52(a)). “A finding of fact is clearly erroneous if it is induced by an
erroneous view of the law, if no evidence supports it, or if, on the entire record,
we are left with a definite and firm conviction a mistake has been made.” Id.




                                         2
[¶9] “Appellate courts review the record and findings as a whole and if the
controlling findings are supported by the evidence, they will be upheld on
appeal notwithstanding immaterial misstatements in the lower court’s decision.”
Pomarleau v. Pomarleau, 

, 

 (citations omitted).
Furthermore, “[w]e will not set aside a district court’s decision simply because
the court applied an incorrect reason, if the result is the same under the correct
law and reasoning.” Sholy v. Cass Cnty. Comm'n, 

, 

 (citations omitted).

                                       III

[¶10] Peterka argues the district court’s finding that the Jandas had capacity to
enter into the option to purchase precludes a finding that the Jandas were of
unsound mind, but not entirely without understanding under N.D.C.C. § 14-01-
02. We disagree, and conclude a finding that a contract was not void for lack of
capacity to enter into a contract does not preclude a finding the contract was
voidable under N.D.C.C. § 14-01-02. We agree certain passages in the district
court’s order create confusion. However, we conclude the district court’s
findings are not based on an erroneous view of the law, and the court’s findings
under N.D.C.C. § 14-01-02 are supported by the evidence.

[¶11] The district court found the option to purchase was not void for lack of
“contractual capacity” or the capacity to enter into a contract. Peterka does not
dispute this finding. The court then analyzed the Jandas’ capacity under
N.D.C.C. ch. 14-01 and found the Jandas lacked “guardianship capacity” under
N.D.C.C. § 14-01-02, rendering the option to purchase “voidable.” The court
explained:

             Section 14-01-02 also provides guidance for situations like the
      present, when a contract is executed by a proposed ward shortly
      before a guardianship is ordered. In this sense, the phrase “was not
      entirely without understanding” as used in this statute is the same
      as “having a general understanding of the nature and effect of the
      transaction” under the three-prong test for “contract capacity.”
      Thus, even when a person has the limited “contract capacity” under
      the three-prong test set forth above . . . , if that person actually
      lacked “guardianship capacity” (even though not yet judicially

                                        3
      determined) the person (by and through his guardian) could rescind
      a contract after a guardianship is put in place. In other words,
      the contract is voidable in favor of the person who “was not entirely
      without understanding,” (or had the three-prong cont[r]act
      capacity) by the person’s later guardian.

The court also explained “for purposes of interpretation of these statutes, ‘a
person entirely without understanding’ equals ‘a person of unsound mind’
equals a person whose ‘incapacity has been judicially determined’ equals a
person whose contracts are null and void.”

                                          A

[¶12] The district court’s reasoning attempts to reconcile capacity to enter into a
contract with a separate and distinct remedy at law for a conveyance or other
contract made by a person adjudicated incapacitated upon application for the
appointment of a guardian after the contract had been made. Specifically, the
court’s explanation that “‘a person entirely without understanding’ equals ‘a
person of unsound mind’ equals a person whose ‘incapacity has been judicially
determined’ equals a person whose contracts are null and void” misstates the
law by conflating separate remedies at law. If we examine the separate remedies
at law and view the district court’s findings from this perspective, then we see
the misstatements are immaterial to the controlling findings. See Pomarleau, 

, ¶¶ 24–25 (explaining that when the district court’s findings are not
perfect, immaterial misstatements should be viewed in light of the record and
findings as a whole). To untangle the district court’s explanation, we must
examine these separate remedies at law.

[¶13] First, each party must have the capacity to enter into a contract. If either
party lacks the capacity to contract, then the contract is void. “Generally, a
contract requires parties capable of contracting, consent of the parties, a lawful
object, and sufficient consideration.” Fettig v. Est. of Fettig, 

, 

 (citing N.D.C.C. § 9-01-02) (cleaned up). “‘Parties capable of
contracting’ refers to the contractual capacity of the parties.” Id. “All persons are
capable of contracting except minors and persons of unsound mind.” N.D.C.C.



                                          4
§ 9-02-01. “Minors and persons of unsound mind have only such capacity as is
specified in statutes relating to such persons.” N.D.C.C. § 9-02-02.

[¶14] The applicable standard requires “the party attacking the validity of the
transaction . . . to prove the grantor, at the time of the transaction, was so weak
mentally as not to be able to comprehend and understand the nature and effect
of the transaction.” Vig, 

; see also Slorby, 

. The
district court relied on the standard outlined in Slorby to determine whether the
Jandas lacked capacity to enter into a contract. The standard provides:

      [B]efore a court may set aside a conveyance on the ground of mental
      incompetency of the grantor, the party attacking the validity of the
      deed must show that the grantor, at the time of the execution of the
      instrument, was so weak mentally as not to be able to comprehend
      and understand the nature and effect of the transaction involved.

Slorby, 

 (citing Runge v. Moore, 

 (N.D. 1972);
Hendricks v. Porter, 

 (N.D. 1961); Nordby v. Sagen, 

,

, Syllabus (1934)); see also Vig, 

 (citing Estate of
Wenzel-Mosset v. Nickels, 

, 

; Matter of Estate of
Nelson, 

 (N.D. 1996); Runge, 

; Lee v. Lee,

, 

 (1940); Meyer v. Russell, 

, 

 (1927)). Notably, the court did not apply this same standard to its
analysis regarding whether the option to purchase was voidable under N.D.C.C.
§ 14-01-02.

[¶15] The Defendants argued the Jandas lacked capacity to contract at the time
the option to purchase was executed. The district court found the Jandas “were
generally aware” of the nature and extent of property involved in the option,
aware of all the parties involved and who might be affected by the option, and
the effect of the contract. The court found the option to purchase was “not null
and void for want of a party capable of contracting under the general standards
for lack of ‘contractual capacity.’” Peterka does not dispute these findings.

[¶16] The district court next “consider[ed] the effect of provisions of Chapter 14-
01[, N.D.C.C.,] on this contract.” The court relied on N.D.C.C. § 14-01-02, finding


                                         5
the option to purchase was voidable. “Rescission of a contract on the ground of
mental incapacity is authorized by N.D.C.C. § 14-01-02.” Slorby, 

. Section 14-01-02, N.D.C.C., governs conveyances and other contracts made
by individuals “of unsound mind, but not entirely without understanding,” who
have been adjudicated incapacitated upon application for the appointment of a
guardian. This section makes the remedy of rescission available only to persons
therein described. See Volk v. Volk, 

 (N.D. 1963); see also
N.D.C.C. § 9-02-02 (“Minors and persons of unsound mind have only such
capacity as is specified in statutes relating to such persons.”).

[¶17] Chapter 14-01, N.D.C.C., governs the “powers of incompetents.” “A
person entirely without understanding has no power to make a contract of any
kind.” N.D.C.C. § 14-01-01. The contract is void. “A conveyance or other contract
of a person of unsound mind, but not entirely without understanding, made
before the person’s incapacity has been determined judicially upon application
for the appointment of a guardian is subject to rescission as provided by the laws
of this state.” N.D.C.C. § 14-01-02. The contract is voidable. “After a person’s
incapacity has been determined judicially upon application for the appointment
of a guardian, a person of unsound mind can make no conveyance or other
contract, nor delegate any power, nor waive any right until the person’s
restoration to capacity is determined judicially.” N.D.C.C. § 14-01-03. The
incapacity determination continues until a court declares otherwise.

[¶18] Under Chapter 14-01, N.D.C.C., a person of unsound mind may or may
not be entirely without understanding. Under the plain language of the statute,
it is clear that a person “entirely without understanding” may differ from a
person of “unsound mind.” See N.D.C.C. § 14-01-02 (“a person of unsound mind,
but not entirely without understanding”). The term “person of unsound mind”
refers to a set of people, which includes a subset of persons “entirely without
understanding.” See N.D.C.C. §§ 14-01-01 and 14-01-02. A person may be
both “of unsound mind” and “entirely without understanding.” See N.D.C.C.
§ 14-01-01. But a person may also be “of unsound mind” and not entirely without
understanding. See N.D.C.C. § 14-01-02. Section 14-01-02, N.D.C.C., applies
only to the subset of persons of unsound mind who are not entirely without



                                        6
understanding. If a person is entirely without understanding, the conveyance or
other contract is void under N.D.C.C. § 14-01-01.

[¶19] Other states have examined the words contained in N.D.C.C. §§ 14-01-01
and 14-01-02, explaining the distinction between a contract or conveyance that is
void and one that is voidable. See, e.g., Fleming v. Consol. Motor Sales Co., 

, 

 (1925); Jacks v. Estee, 

, 

 (1903). Under
N.D.C.C. § 14-01-01, “[a] person entirely without understanding has no power to
make a contract of any kind.” Analyzing this same language, Montana and
California courts have explained:

      [O]bviously, the term “understanding” is used to denote not the act
      of understanding, but the capacity or faculty of doing so; and the
      expression “without understanding” is to be understood as referring
      to persons without such capacity. Nor is the expression to be
      understood in its literal and extreme sense—for hardly in any case
      can even the most insane person be said to be without some degree
      of understanding (1 Wharton on Contracts, § 98); but rather it is to
      be understood as restricted to the subject-matter to which the section
      relates—which is that of contracts, executed and executory—and
      hence as applying to all persons who are entirely without the
      capacity of understanding or comprehending such transactions.

Fleming, 

, 

 (quoting Jacks, 

, 

).
Comparing N.D.C.C. §§ 14-01-01 and 14-01-02, “evince[s] a legislative attempt to
avoid conflicting judicial opinion as to when an instrument is utterly void or
merely voidable.” Id.

[¶20] Oklahoma explains the statutory language this way:

      The words “entirely without understanding” . . . have reference to
      the nature of the contract assailed. In order to render a deed void
      under this section on the ground of insufficient mental capacity, it
      must be shown that the grantor not only did not understand the
      nature of the transaction, but also that he was without sufficient
      mental capacity to understand it. While this particular section was
      not mentioned, we think the rule announced in Miller v. Folsom, 

, 

, announces the just and correct rule to be
      applied in determining the competency of a grantor to execute

                                          7
      a deed. It was there held that the test to be applied in such
      circumstances is that the grantor shall have the ability to understand
      the nature and effect of the act in which he is engaged and the
      business he is transacting, and that in order to invalidate the deed it
      must be shown that the grantor was incapable of comprehending
      that the effect of the deed when made, executed, and delivered
      would be to divest him of the title to the land set forth in the deed.

Sooner Fed. Sav. & Loan Ass'n v. Smoot, 

, 

.

[¶21] It follows that if, at the time they executed the option contract, the Jandas
were “entirely without understanding,” their acts were void under N.D.C.C.
§ 14-01-01. Id. Proof that they were of unsound mind would not be sufficient to
void the option contract under N.D.C.C. § 14-01-01. See id. However, N.D.C.C.
§ 14-01-02, “declares under what circumstances a contract of a person of
unsound mind, but not entirely without understanding, may be rescinded.”
Fleming, 

, 

.

[¶22] The standard for determining whether the option to purchase was void
under N.D.C.C. § 14-01-01, as articulated by other states’ courts, is very similar
to our standard for determining whether a contract is void for lack of capacity to
enter into a contract. Compare Smoot, 

 (“the grantor shall have the
ability to understand the nature and effect of the act in which he is engaged and
the business he is transacting, and that in order to invalidate the deed it must be
shown that the grantor was incapable of comprehending [ ] the effect of the deed
when made, executed, and delivered”); with Vig, 

 (“the grantor,
at the time of the transaction, was so weak mentally as not to be able to
comprehend and understand the nature and effect of the transaction”). However,
the standard to determine whether the option to purchase was voidable under
N.D.C.C. § 14-01-02 differs from the standard in assessing whether a contract is
void at its inception. Therefore, the district court’s findings that the Jandas lacked
capacity to enter into the option to purchase does not automatically preclude a
finding that the Jandas were of unsound mind, rendering the option to purchase
voidable under N.D.C.C. § 14-01-02.




                                          8
[¶23] The district court’s confusion is understandable owing to our case law
purporting to adopt the same standard for capacity to enter into a contract as the
standard rendering a contract voidable under N.D.C.C. § 14-01-02. In Slorby, we
examined N.D.C.C. § 14-01-02 and erroneously adopted the same standard we
articulated as the capacity to enter into a contract “for determining incapacity
under [14-01-02]” by quoting a “long line of authority.” Slorby, 

(citing Lee, 

, 

 (examining capacity to enter into a
contract); Meyer, 

, 

 (examining capacity to execute a
deed); Johnson v. Johnson, 

, 224–225 (N.D. 1957) (examining
capacity to execute a deed)). In 1940, the Lee Court compiled cases, which we
have since repeated as the “test of capacity” at the time of the transaction. 

, 

; see Johnson, 

 (quoting Lee’s “test of
capacity” laid down several times and concluding “we are satisfied that he was
of such a mind and memory at the time of the execution of the deed, that he
understood and comprehended the meaning and effect thereof, and was able to,
and did exercise his will in executing the deed”); Hendricks v. Porter, 

 (N.D. 1961) (quoting Lee’s “test of capacity” laid down several times to
examine capacity to execute a deed); Runge, 

 (quoting Lee’s
“test of capacity” laid down several times to examine capacity to execute a deed);
Vig, 

 (citing Runge quoting Lee’s “test of capacity” laid down
several times to examine capacity to execute a deed); but see Slorby, 

 (apply Lee’s “test of capacity” laid down several times to determine
whether a deed is voidable under N.D.C.C. § 14-01-02). Our misstatement in
Slorby highlights the confusion in the district court’s analysis, which requires
clarification here.

[¶24] Slorby was a deviation from our clear distinction between the two
standards for separate remedies at law. In Runge, 

, this Court
examined “whether the mineral deed is voidable because of the unsoundness of
mind, as defined in Section 14-01-02, N.D.C.C., at the time of the transaction in
question.” The Runge court explained, under N.D.C.C. § 14-01-02, the district
court would be required to find “[Annie Bell] was of ‘unsound mind, but not
entirely without understanding’” at the time of the transaction in question in
order to set aside the deed. Id. at 102. The Court concluded evidence was not


                                        9
presented to support a finding that Bell was of unsound mind but not entirely
without understanding. Id. However, the Court went on to explain that “all of
the witnesses present at the time of the transaction . . . testified that, in their
opinion, Annie M. Bell was competent and did understand the transaction at the
time the mineral deed was executed and delivered.” Id. The Court quoted Lee’s
“test of capacity . . . laid down by this court several times” and then concluded
Bell “understood and comprehended the meaning and effect [of the deed] and
was able to and did exercise her will in executing the mineral deed in question.”
Id. at 103. The Runge Court correctly applied Lee’s “test of capacity” laid down
several times to determine whether Bell lacked capacity to execute the deed in
question.

[¶25] In Slorby, the underlying action was a rescission action commenced by a
conservator. The remedy at law was rescission. The district court found: “Melvin
Steffens was a person of unsound mind and suffered a mental deficiency caused
by advanced age or other cause or causes. This condition was such that Mr.
Steffens lacked sufficient understanding and capacity to make responsible
decisions regarding his property.” The court explained: “Melvin Steffens was not
able to enter into a Contract for Deed concerning the property since his mind and
memory were of a condition which rendered him incompetent to judge his rights
and interests in relation to the transaction.” Slorby, 

. This is the
correct application of the standard and appropriate supporting findings for
rescission under N.D.C.C. § 14-01-02. See Runge, 

 (court must
find the person of unsound mind but not entirely without understanding);
N.D.C.C. § 30.1-26-01(2) (“incapacitated person” under the probate code refers
to a person who “lacks capacity to make or communicate responsible decisions
concerning that person’s . . . legal affairs”).

[¶26] However, in Slorby, this Court adopted Lee’s test of capacity, which
analyzes the capacity to enter into a contract, and declared the same standard
applies to N.D.C.C. § 14-01-02. This was an error. The Slorby Court ultimately
analyzed the evidence and concluded: “On this record, we conclude that the trial
court’s finding that Steffens lacked the mental capacity to enter into the . . .
contract for deed is not clearly erroneous.” The Slorby Court articulated the
erroneous standard to examine whether the deed was voidable under N.D.C.C.

                                         10
§ 14-01-02, but ultimately determined the deed was void because Steffens lacked
the capacity to enter into the contract for deed, without distinguishing the two
separate remedies at law.

[¶27] In contrast, the Runge Court specifically applied Lee’s “test of capacity”
laid down several times to determine whether Bell lacked capacity to execute the
deed in question after concluding the record did not support a finding that Bell
was of unsound mind but not entirely without understanding under N.D.C.C.
§ 14-01-02. In Vig, this Court specifically rejected the Estate’s claim that
commencement of guardianship proceedings around the time frame of execution
of the quit claim deed would “compel a finding that Junietta Swenson lacked
capacity to execute the quit claim deed.” 

. The two standards
are separate and distinct.

[¶28] To the extent Slorby purports to adopt the same standard to determine
whether an individual lacks capacity to enter into a contract as to examine
whether a contract or other conveyance is voidable under N.D.C.C. § 14-01-02,
we clarify here that the standards are distinct. While the standard to determine
whether a contract is void for lack of capacity to enter into a contract is very
similar to the capacity rendering a contract void under N.D.C.C. § 14-01-01, we
have explained that section 14-01-01 differs from 14-01-02. Section 14-01-02,
N.D.C.C., requires a finding of an “unsound mind.”

[¶29] The district court did not materially misstate the law. Nor did any
misstatement result in an erroneous application of the law in making the court’s
findings. We therefore review whether the district court’s findings are supported
by the evidence.

                                       B

[¶30] Under N.D.C.C. § 14-01-02, the option to purchase is a contract made
before the Jandas’ incapacity was determined judicially upon application for the
appointment of a guardian. Three months after the execution of the option to
purchase, the district court judicially determined the Jandas were incapacitated
in guardianship proceedings under N.D.C.C. ch. 30.1-28. The petitions for
guardianship were filed only one day after the execution of the option to

                                       11
purchase. Therefore, section 14-01-02, N.D.C.C., applies, and the option contract
is subject to rescission if the court finds the Jandas were “of unsound mind.”

[¶31] Chapter 14-01, N.D.C.C., does not define “unsound mind.” The North
Dakota Century Code uses the term “unsound mind” when describing
“capacity” or “competency” in the areas of contract law, marriage, civil
liabilities, and disabilities and guardianships of individuals, including criminal
defendants. See, e.g., N.D.C.C. §§ 9-02-02, 14-01-02, 14-04-01, 14-10-03, 28-03-04,
28-03-06, 32-03-08. Examining the marriage statutes, we have explained, “there
has been a hesitancy on the part of the courts to judicially define the phrase
‘unsound mind.’” Johnson v. Johnson, 

 (N.D. 1960) (explaining
“[e]xamination of authorities discloses that there is no precise definition of the
term ‘unsound mind’, as employed by Section 14-0401, [NDRC 1943], and the
difficulty of formulating a comprehensive definition long has been recognized”).
In the context of civil remedies and commencing lawsuits, we examined the
statutory term “insane” under N.D.C.C. ch. 28-01 and explained California’s
definition of “insane,” which is interchangeable with the term “mentally
incompetent,” that “a person having an unsound mind or having a mental
condition rendering that person incapable of comprehending legal rights” is a
useful and accurate definition. BASF Corp. v. Symington, 

, 695 n.2
(N.D. 1994) (emphasis added).

[¶32] Section 14-01-03, N.D.C.C., describes a person who has been judicially
determined to be incapacitated by guardianship proceedings as “a person of
unsound mind.” See also In re Guardianship of Frank, 

 (N.D.
1965) (emphasis added) (quoting Goetz v. Gunsch, 

 (N.D.
1956)) (“Section 30-10-02, N.D.C.C., vests in the county court power to appoint a
guardian of the person or estate, or both, where the jurisdictional facts exist and
the person ‘is of unsound mind, or from any cause mentally or otherwise
incompetent to manage his own property.’”). Under the Uniform Probate Code,
“incapacitated person” means:

      [A]ny adult person who is impaired by reason of mental illness,
      mental deficiency, physical illness or disability . . . to the extent that
      the person lacks capacity to make or communicate responsible


                                         12
      decisions concerning that person’s matters of residence, education,
      medical treatment, legal affairs, vocation, finance, or other matters,
      or which incapacity endangers the person’s health or safety.

N.D.C.C. § 30.1-26-01(2).

[¶33] A four-day bench trial was held on this matter. “The Court heard
considerable evidence concerning the Jandas’ mental state, both from lay people
and from experts.” The court “heard from two different attorneys who
represented the Jandas, at or about this time” and from three separate medical
or psychological professionals. Both parties presented expert testimony, and the
court-appointed expert in the Jandas’ guardianship proceedings also testified.
The court further reviewed two recordings of the Jandas from June 14 and June
16, 2021. The court reviewed the expert and visitor reports from the guardianship
proceedings as well as the transcript from the hearing on the guardianship
proceedings. The court also reviewed the Jandas’ medical records beginning in
October 2019.

[¶34] On the basis of the record, the district court found:

             Both of the Jandas were of advanced age in 2021. Both were,
      as found by the Court in the guardianship proceedings, suffering
      from degenerative mental conditions (John from “dementia” and
      Irene from “Alzheimer’s dementia.”) In May of 2021, Irene had
      fallen and broken her hip. By June 14, 2021, both John and Irene had
      moved out of their home and into the Hatton Prairie Valley nursing
      home. Even before that date, their medical records indicate mental
      failings.
             For example, after a medical appointment on February 21,
      2021, John’s doctor indicated he had a “history of . . . progressive
      memory loss.” On a Hatton Prairie Village Bowel Assessment Form
      for John dated May 25, 2021, there is indicated a diagnosis of
      “dementia.” John’s records at Hatton Prairie Village indicate a
      diagnosis of “dementia” on June 23, 2021. On his Hatton Valley
      Prairie Care Plan there is a note from June 2, 2021, which states:
      “John has a memory/recall problem, decision making problems”
      and a notation of “dementia.” On June 11, 2021, there is an indication
      in the Hatton Prairie Village Long Term Record that John at times
      “did not recall previous conversations.”

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             Irene’s medical records contain similar instances which show
      mental failings significantly before October 14, 2021. For example,
      on her Hatton Valley Prairie Care Plan, there is a note on June 1,
      2021, which states: “Irene has a memory recall problem” and a
      notation of “dementia.” In a Long Term Record from Hatton Prairie
      Valley dated June 13, 2021, it outlines the following exchange:
      “’We’ve been here 2 wks and our kids haven’t been here to visit.’
      Reminded that they had been here by CNA and she replied ‘Don’t
      tell my daughter I’m confused.’” On June 14, 2021, the date the
      Option was signed, an Occupational Therapy note states that Irene
      “demonstrates increased confusion this date in telling therapist a
      story, repeating self excessively.” Similarly, on June 15, 2021, the
      Long Term Record reports: “PT & OT both report that she is more
      confused today. She asked them both several times who they were
      and did not retain that information.”

(Internal record citations omitted.)

[¶35] The district court weighed the competing experts’ opinions and found “the
Plaintiff’s expert’s opinion less credible and less convincing than that of the other
experts.” The district court found “from the totality of the evidence presented,
that on June 14, 2021, when the Option was executed, a guardianship would have
been warranted for both the Jandas and that they lacked ‘guardianship capacity.’
Thus, even though the Jandas exhibited ‘contract capacity’ at that time (or, in the
language of the Section 14-01-02, ‘were not entirely without understanding’), the
Option was voidable and subject to rescission.” The district court previously
explained by its own definitions, “a person who has been adjudicated as
incapacitated in a guardianship proceeding is a person of unsound mind, or in
other words, a person who lacks ‘guardianship capacity.’” Therefore, the district
court found the Jandas were of unsound mind but not entirely without
understanding under N.D.C.C. § 14-01-02, rendering the option contract
voidable. The district court’s findings are supported by the record.

[¶36] “We do not reweigh evidence or reassess credibility, nor do we reexamine
findings of fact made upon conflicting testimony. We give due regard to the trial
court’s opportunity to assess the credibility of the witnesses, and the court’s
choice between two permissible views of the evidence is not clearly erroneous.”


                                         14
Vig, 

 (cleaned up). Having reviewed the record and findings
as a whole, we conclude the controlling findings are supported by the evidence
and the findings are not based on an erroneous view of the law. Nor are we left
with a definite and firm conviction a mistake has been made. The district court’s
findings are not clearly erroneous.

                                      IV

[¶37] We have considered the parties’ remaining arguments and conclude they
are either unnecessary to our decision or without merit. We affirm the district
court judgment.

[¶38] Jon J. Jensen, C.J.
      Daniel J. Crothers
      Lisa Fair McEvers
      Jerod E. Tufte
      Douglas A. Bahr




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