Martinson Bros. v. Hjellum

Decision Date03 January 1985
Docket NumberNo. 10593,10593
Citation359 N.W.2d 865
PartiesMARTINSON BROS., a partnership, and John W. Martinson, Linda L. Martinson, and Susan M. Libecki, Plaintiffs, and Oscar B. Martinson, Plaintiff and Appellant, v. John HJELLUM and the Law Firm of Hjellum, Weiss, Nerison, Jukkala & Wright, Defendants and Appellees. Civ.
CourtNorth Dakota Supreme Court

Jerome S. Rice, Minneapolis, Minn., for plaintiff and appellant.

Mart R. Vogel, of Vogel, Brantner, Kelly, Knutson, Weir & Bye, Fargo, for defendants and appellees.

VANDE WALLE, Justice.

Martinson Bros., a partnership, and John W. Martinson, Linda L. Martinson, Oscar B. Martinson, and Susan M. Libecki brought an action for damages against John Hjellum and the law firm of Hjellum, Weiss, Nerison, Jukkala & Wright alleging legal malpractice in connection with the defense of the foreclosure and deficiency-judgment suits at issue in Oakes Farming Ass'n v. Martinson Bros., 318 N.W.2d 897 (N.D.1982). Following a bench trial, the district court ruled in favor of Hjellum. Oscar Martinson has appealed "from the Findings of Fact, Conclusions of Law and Order for Judgment" and from an order denying his post-trial motions. Hjellum has moved to dismiss both appeals. We deny Hjellum's motion to dismiss the appeal "from the Findings of Fact, Conclusions of Law and Order for Judgment;" grant Hjellum's motion to dismiss the appeal from the order denying Martinson's post-trial motions; and affirm the judgment of the district court.

MOTION TO DISMISS

On September 29, 1983, the district court issued its memorandum decision, which was designated to serve as its findings of fact, conclusions of law, and order for judgment. Judgment was entered on October 20, 1983.

Martinson has filed two notices of appeal. The first states that he appeals "from the Findings of Fact, Conclusions of Law and Order for Judgment entered in this action on the 20th day of October, 1983." 1 Hjellum asserts that we are without jurisdiction to consider this appeal.

Hjellum correctly points out that an order for judgment, as contrasted with the judgment itself, is not appealable. E.g., Fey v. Fey, 337 N.W.2d 159 (N.D.1983); Piccagli v. North Dakota State Health Dept., 319 N.W.2d 484 (N.D.1982). However, the circumstances in this case are almost identical to those present in Sacchini v. Dickinson State College, 338 N.W.2d 81, 82 n. 1 (N.D.1983), and Aasmundstad v. Dickinson State College, 337 N.W.2d 792, 793 n. 1 (N.D.1983). In both Sacchini and Aasmundstad appeals were taken " 'from the Order for Judgment entered in this action on the 20th day of December, 1982.' " Because the judgments themselves, rather than the orders for judgment, were entered on December 20, 1982, we treated the appeals as being taken from the judgments.

In this case, the judgment was entered on October 20, 1983, and it is the only document in the record bearing that date. We therefore conclude that the appeal is, in fact, from the judgment entered on that date. Cf. Eisenzimmer v. City of Balfour, 352 N.W.2d 628 (N.D.1984); Hadland v. Schroeder, 326 N.W.2d 709 (N.D.1982).

Martinson's second appeal is from the district court's memorandum and order

denying his post-trial motions for a new trial, for a directed verdict, for relief from judgment, and for a stay of judgment pending appeal. Martinson neither briefed nor argued in the district court or this court any issues related to these motions. See Rule 3.2(d), N.D.R.O.C. Martinson's brief in opposition to the motion to dismiss contains no response to Hjellum's arguments for dismissing the second appeal. We therefore deem it abandoned and dismiss Martinson's appeal from the district court's memorandum and order denying his post-trial motions.

MERITS
I. Facts 2

In the fall of 1977, the Martinsons decided to purchase a 2,300-acre potato-farming operation owned by the Oakes Farming Association [Oakes]. The Martinsons met with Hjellum, who had represented them in various legal matters beginning in 1969, and requested that he review a contract which had been prepared by Oakes's attorneys for the sale of the farmland and equipment. The contract listed the total purchase price of the real and personal property as $2,702,000, with the Martinsons assuming the obligations under three other contracts. The first contract to be assumed by the Martinsons was for the sale of real property which Oakes had purchased from Orrin and Naomi Streich, the second was an equipment installment sales contract between Oakes and the Streichs, and the third was for the sale of additional real property which Oakes had purchased from Leo and Alice Spitzer. Hjellum redrafted the agreement because of various omissions in the proposed contract. The Martinsons paid $5,000 in earnest money, and the contract was signed by all of the parties effective December 31, 1977.

The Martinsons took possession on January 1, 1978, and placed the entire farm into the production of potatoes, contrary to the advice of others to diversify. They were inexperienced in the planting, growing, harvesting, and marketing of potatoes.

Many problems befell the Martinsons during 1978. The Martinsons failed to apply a recommended herbicide to the crop, irrigation equipment worked poorly, they were unable to secure adequate financing for the potato operation because of a poor credit rating, and the market price of potatoes dropped. The Martinsons' potato harvesters were repossessed during the harvest season. Hjellum successfully negotiated for the return of the harvesters so that harvest work could continue, and also assisted the Martinsons in securing a $100,000 loan to pay for harvest labor.

The Martinsons were unable to make any payments under the terms of their contract with Oakes. As a result, Oakes was unable to pay the Streichs. In October 1978, the Streichs brought two separate lawsuits against Oakes to foreclose the contract for deed and to cancel the equipment installment sales contract. Oakes then brought a cross-claim against the Martinsons in January 1979 seeking $633,879 for their failure to make the payments due under the December 31, 1977 agreement; $434,642 for their failure to pay the installments due under the Oakes-Streich equipment installment sales contract; and to foreclose and cancel any interest the Martinsons had in the real property involved, specifically reserving its right to request a deficiency judgment in a separate action. Hjellum, on behalf of the Martinsons, filed a counterclaim and an answer to the cross-claim, but did not assert as a defense that the December 1977 agreement for the sale of the real and personal property was nonseverable under this court's decision in McKee v. Kinev, 160 N.W.2d 97 (N.D.1968). 3

During the ensuing months, Hjellum advised the Martinsons to authorize a settlement and conferred on various occasions with his clients, counsel for the other parties, and the trial judge. The Martinsons, however, refused to accept any settlement offers and wished to continue to operate the farm.

The trial judge called a special term of court for March 1979 to fix a redemption period and determine possessory rights so that a crop could be produced for the 1979 season. Hjellum testified in the instant case that he believed the Martinsons faced an "impossible situation." Hjellum foresaw difficulty in proving the amounts asserted in the Martinsons' counterclaim and believed the Martinsons would be permitted little or no redemption period because they had paid only $5,000 on the $2,702,000 contract and would be financially unable to put in a crop for the 1979 season. Hjellum further testified that in view of the substantial indebtedness and the possibility of a deficiency judgment, he did not believe the Martinsons "had a ghost of a show in working it out" and continued to advise them that "this is a matter that had to be settled."

According to Hjellum, he continued to negotiate with counsel for the other parties and on March 21, 1979, reached an oral agreement with Douglas Christensen, counsel for Oakes, to the effect that Oakes would not seek a deficiency judgment if the Martinsons' financial statement demonstrated that it would not be "worthwhile" to pursue a deficiency judgment. Hjellum contacted John Martinson on March 23, 1979, and he agreed to accept the proposal. Hjellum understood the settlement to be that if the Martinsons' net worth was less than $90,000, Oakes would not seek a deficiency judgment. Hjellum testified that John Martinson assured him that their financial statement would show a net worth of well below $90,000.

On March 26, 1979, the date set for trial, the parties entered into an oral stipulation in open court. During the morning proceedings, the following settlement terms were dictated into the record:

"[Mr. Christensen] (8) That Martinson Brothers shall present to Oakes Farming Association a current financial statement which shall list all of their assets and liabilities for review by Oakes Farming Association; it being specifically recognized between the parties that Oakes Farming Association is entering into this stipulation and will no longer pursue its action for monetary damages against Martinson Brothers inasmuch as it appears that Martinson Brothers liabilities, either long term or short term, exceed their assets.

"It being further recognized and agreed that Oakes Farming Association, if the information becomes available or information ascertain [sic] by Oakes Farming Association which makes it appear that the statement is incorrect as to any material matters, that Oakes Farming Association reserves the right to proceed against Martinson Brothers for any deficiencies that they may have as a result of the sale of the land purchased by Martinson Brothers."

During the afternoon session, Christensen explained:

"MR. CHRISTENSEN: Well, for the record, the agreement perhaps was not properly stated this morning when we were discussing the financial statement of the...

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