Hough v. Harvey, C5-87-101

• Citation: 410 N.W.2d 53
• Decision Date: 04 August 1987
• Docket Number: No. C5-87-101,C5-87-101
• Parties: Curtis L. HOUGH, Appellant, v. Donald HARVEY, Respondent.
• Court: Minnesota Court of Appeals

Page 53

410 N.W.2d 53

Curtis L. HOUGH, Appellant, v. Donald HARVEY, Respondent.

No. C5-87-101.

Court of Appeals of Minnesota.

Aug. 4, 1987.

Syllabus by the Court

Trial court did not err in determining that respondent's actions did not manifest an intent to accept appellant's offer to sell stock.

Michael D. Quayle, Dudley R. Younkin, Green, Merrigan, Johnson & Quayle, P.A., Minneapolis, for appellant.

Thomas A. Foster, Foster, Waldeck & Lind, Ltd., Minneapolis, for respondent.

Heard, considered and decided by CRIPPEN, P.J., and LESLIE and LOMMEN, JJ. ^*

OPINION

LOMMEN, Judge.

This appeal is from a judgment in an action for breach of contract. Appellant Curtis L. Hough claims that respondent Donald Harvey accepted his offer to sell his stock in Castlewood Arabians, Inc., and Castlewood Corporation for $45,000 and assumption of a note for $176,000. He claims that Harvey's conduct manifested an acceptance of his offer, creating a binding contract which Harvey then breached by his failure to assume the note. The trial court held that Harvey did not accept appellant's offer, and no contract was formed. We affirm.

FACTS

The facts are not disputed. In August of 1984, appellant became dissatisfied with the management of two related corporations in which he held an interest, Castlewood Arabians, Inc., and Castlewood Corporation. Appellant then told Roger Hauge, a lawyer and the managing shareholder of the corporations, that he desired either control of the corporations, or to be bought out. He told Hauge that his terms for a buy-out were (1) return of the $45,000 he had invested in the two corporations, and (2) the assumption of a $176,000 note for which he was personally obligated at the Suburban National Bank of Eden Prairie (Bank).

Roger Hauge then located respondent as a potentially interested party. On August 13, 1984, the parties met to discuss the purchase of appellant's interest. Two events took place in September: Hauge and respondent went to the bank to discuss respondent's assumption of the note, and respondent loaned Castlewood Arabians $45,000. Castlewood Arabians then, through Roger Hauge, tendered two checks for $25,000 and $20,000 to appellant. Appellant accepted the checks and then endorsed the stock certificates in blank.

Although the bank had approved respondent's assumption of the note, respondent took no action to do so. Instead, in November of 1984, respondent notified appellant that he wished to have an audit made of the corporation's books. The audit was performed, and respondent deemed it prudent not to invest in the corporations.

Appellant then brought this action against respondent claiming that he had believed that he was selling his stock to respondent, not Castlewood Arabians, and further, that respondent had, through his conduct, manifested an intent to accept his offer, thereby creating a binding contract. Appellant claimed that it was only after the creation of the contract that respondent expressed an unwillingness to complete the transaction. Appellant thus claimed that respondent had breached the contract, and sought damages.

The trial court concluded that respondent's actions did not manifest an intent to accept appellant's offer to sell his interests in Castlewood Arabians and Castlewood Corporation, and that he did not express a willingness to be bound by the terms which were discussed. The trial court stated that although the parties had held preliminary discussions concerning respondent's proposed purchase of appellant's interests, no contract was ever formed by the parties. The trial court ordered judgment for respondent. Appellant's motion for amended findings of fact, conclusions of law and order for judgment was denied. The trial court entered judgment on December 16, 1986. Appeal is made from the December judgment.

ISSUE

Did the trial court err in determining that respondent did not manifest an intent to accept appellant's offer to sell his interests in the corporations?

ANALYSIS

In his post-trial motion, appellant accepted the trial court's findings of fact but disputed its conclusions of law as clearly erroneous. On appeal from the judgment, he once again challenges those conclusions and we review the denial of his motion for amended conclusions of law. See Minn.R.Civ.App.P. 103.04.

Appellant argues that he believed that the two checks were from respondent, not Castlewood Arabians, and further, that respondent "secretly" loaned Castlewood Arabians the money, making it appear as if respondent were actually purchasing appellant's interest. Appellant claims that the negotiations, the subsequent purchase of the stock, and respondent's discussion with the bank regarding assumption of appellant's note manifest an intent to accept appellant's offer, creating a binding contract.

The existence of a contract is primarily a question of fact to be determined by the trial court on the basis of evidence presented and the surrounding circumstances. Malmin v. Grabner, 282 Minn. 82, 86, 163 N.W.2d 39, 41 (1968). An acceptance of an...