Fidelity Bank v. Dunbar Armored, Inc., No. A04-997 (MN 12/14/2004)
| Decision Date | 14 December 2004 |
| Docket Number | No. A04-997.,A04-997. |
| Parties | Fidelity Bank, Edina Minnesota, et al., Respondents, v. Dunbar Armored, Inc., a Maryland corporation, Appellant, St. Paul Mercury Insurance Co., Defendant. |
| Court | Supreme Court of Minnesota (US) |
Appeal from the District Court, Hennepin County, File No. CT-02-010248.
William R. Skolnick, Sean A. Shiff, Skolnick & Associates, (for respondents).
Robert G. Haugen, David E. Camarotto, Johnson & Lindberg, P.A., (for appellant).
Considered and decided by Harten, Presiding Judge; Klaphake, Judge; and Stoneburner, Judge.
UNPUBLISHED OPINION
Respondents, an ATM operator and a bank, brought this action against appellant, an armored car company that transported cash between them, when they discovered a loss. Appellant counterclaimed for the final payment due under the parties' contract. A jury awarded respondents their claimed loss, less appellant's final payment. Appellant now challenges the denials of its pre-trial motion for summary judgment and its posttrial motion for judgment notwithstanding a verdict (JNOV) or a new trial. Because we see no error of law and no abuse of discretion in the denials of the motions, we affirm.
Appellant Dunbar Armored, Inc., (Dunbar) is engaged in the business of transporting currency and servicing automated teller machines (ATMs). Respondent Cash Systems, Inc. (CSI) is engaged in the business of providing ATMs. Respondent Fidelity Bank (Fidelity) is a national banking association.1 In February 1999, the parties entered into a one year "Tri-Party Armored Carrier Service Agreement" (the agreement) providing that Dunbar would service CSI's ATMs using cash from Fidelity. The agreement was renewed for another year in February 2000. After it expired in February 2001, Dunbar returned the cash. Fidelity discovered a shortage of $412,185.95.
CSI and Fidelity brought this action against Dunbar asserting claims of negligence, breach of fiduciary duty, breach of contract, misrepresentation, and conversion, and they moved for summary judgment on those claims. Dunbar alleged defenses of waiver by conduct and untimely notice of claims, and moved for summary judgment dismissing all claims against it; Dunbar also counterclaimed for the final payment owed under the agreement. The district court granted Dunbar's summary judgment on the claims of negligence and breach of fiduciary duty and dismissed those claims with prejudice. The district court found that fact questions precluded summary judgment on CSI's and Fidelity's claims of breach of contract, misrepresentation, and conversion, and on Dunbar's defenses of waiver by conduct and waiver by untimely notice.
Following trial, the jury found Dunbar liable on grounds of negligence, breach of fiduciary duty, breach of contract, and misrepresentation, and it awarded CSI and Fidelity $412,185.95, less Dunbar's final invoice of $32,602.49. Dunbar moved for JNOV or a new trial. That motion was denied, and Dunbar appeals both that denial and the denial of its motion for summary judgment.2
Dunbar first challenges the denial of its motion for summary judgment. The denial of a motion for summary judgment may be raised on appeal from the final judgment. Reinhardt v. Milwaukee Mut. Ins. Co., 524 N.W.2d 531, 533 (Minn. App. 1994), review denied (Minn. 14 Feb. 1995). On appeal from denial of summary judgment, this court must determine whether any genuine issues of material fact exist and whether the district court erred in applying the law. Zank v. Larson, 552 N.W.2d 719, 721 (Minn. 1996). Dunbar contends that the district court erred in denying summary judgment because CSI and Fidelity waived their right to bring this action through their continued dealing with Dunbar, through acquiescence in Dunbar's statements of account, and because CSI and Fidelity failed to make a prima facie claim of loss.
Dunbar does not contest the finding that it breached the agreement, but argues that CSI's and Fidelity's decision to extend the agreement for a second year operates as a de facto waiver of their right to sue for Dunbar's breach.3 Dunbar relies on Creative Communications Consultants, Inc. v. Gaylord, 403 N.W.2d 654, 657 (Minn. App. 1987) for the proposition that "[a] party's continued recognition of a contract as binding after the other party's alleged breach acts as a waiver of that breach." That reliance is misplaced. Creative Communications is distinguishable: it concerned a former employee who signed an employment agreement containing a non-compete provision, resigned and "executed a[nother] document acknowledging the validity of the non-compete covenant and agreeing to be bound by it," then accepted employment in breach of the non-compete and was sued for breach by the former employer. Id. at 656. This court rejected the employee's argument that he was excused from the non-compete covenant because the former employer had allegedly breached other provisions of the employment contract. Thus, Creative Communications refutes, rather than supports, Dunbar's argument.
Moreover, the agreement explicitly provided that
[a]ny practice or custom of [Fidelity, Dunbar, or CSI] at variance with the provisions of this Agreement shall not constitute a waiver of such provisions unless such practice or custom shall be agreed upon in writing and such writing shall be made an amendment to this Agreement.
Neither Fidelity nor CSI ever agreed in writing that their practice of extending the agreement for a second year was a waiver of the right to bring an action for breach of the agreement.
In September 2000 Dunbar sent a statement to Fidelity, which signed it and sent it to Dunbar's auditors, saying that, as of 23 August 2000, Dunbar held $317,360 for Fidelity. Dunbar relies on this statement to argue that Fidelity acquiesced in Dunbar's accounts and thereby waived the right to challenge them. But this statement refers only to the amount Dunbar was holding in a vault, not to the amount in the ATMs or in transit in Dunbar vehicles.
Dunbar relies on Kittler & Hedelson v. Sheehan Properties, 295 Minn. 232, 238, 203 N.W.2d 835, 839 (1973), which holds that retaining a statement of account without objecting to it "may under certain circumstances operate as proof of an acquiescence in or an admission of the correctness of the statement of account. . . ." (Quotation omitted.) But Kittler is readily distinguishable. It concerned an attorney-client dispute over fees: the client had retained the attorney's fee statements without objecting to them before bringing the lawsuit. Here, the dispute does not concern fees owed to Dunbar; it concerns approximately $412,000 in cash that disappeared during the parties' relationship. Kittler does not provide a basis for granting Dunbar summary judgment.
Dunbar also claims that it was entitled to summary judgment because CSI and Fidelity failed to make a prima facie claim of loss by showing where and when the loss occurred. This claim ignores the provision in the agreement that Dunbar would be liable "[f]or any loss or theft of [CSI] funds while those funds are in the exclusive possession of DUNBAR" and "at all times for the safety of any property received into [Dunbar's] possession at any time . . . ." CSI and Fidelity did not have to show where and when the loss occurred to make a prima facie claim under the agreement.
Dunbar relies on another provision in the agreement, "that . . . the unexplained loss of currency shall not create any presumption that DUNBAR is liable for such loss in the absence of proof DUNBAR was responsible for such loss." But CSI and Fidelity did more than assert an "unexplained loss of currency"; they provided evidence that independently created a presumption of Dunbar's liability. At the summary judgment stage, no more is required: "issues of causation also involve questions of fact and seldom can be disposed of on a motion for summary judgment." Bondy v. Allen, 635 N.W.2d 244, 248 (Minn. App. 2001) (quotation omitted).
The district court did not err in denying Dunbar's motion for summary judgment.
"On appeal from a denial of a motion for a new trial, the verdict must stand unless it is manifestly and palpably contrary to the evidence, viewed in a light most favorable to the verdict." ZumBerge v. N. States Power Co., 481 N.W.2d 103, 110 (Minn. App. 1992), review denied (Minn. 29 Apr. 1992). Because the district court has the discretion to grant a new trial, we will not disturb its decision absent a clear abuse of that discretion. Halla Nursery, Inc. v. Baumann-Furrie & Co., 454 N.W.2d 905, 910 (Minn. 1990). Dunbar argues that it is entitled to a new trial on two grounds: omission of items from the special verdict form and jury mistake.
Dunbar contendsthat the district court erred in not submitting to the jury questions on CSI's and Fidelity's comparative fault, breach of fiduciary duty, and breach of contract.4
Two of the claims against Dunbar, breach of contract and fraudulent misrepresentation, do not involve a comparative fault analysis. Submitting questions irrelevant to those claims would arguably have confused the jury. See Bilotta v. Kelley Co., 346 N.W.2d 616, 626 (Minn. 1984) (Simonett, J., concurring specially) (). Moreover, the jury found Dunbar liable on the two claims that do not involve comparative fault. When a jury's finding on some claims would not...
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