Nelson v. Schellpfeffer
Decision Date | 15 January 2003 |
Docket Number | No. 22117.,22117. |
Parties | Robert E. NELSON, Plaintiff and Appellant, v. Donald A. SCHELLPFEFFER, Defendant and Appellee. |
Court | South Dakota Supreme Court |
Kent R. Cutler and Michael D. Bornitz of Cutler, Donahoe & Mickelson, Sioux Falls, South Dakota, Attorneys for plaintiff and appellant.
William G. Taylor and Daniel J. Harmelink of Woods, Fuller, Shultz & Smith, Sioux Falls, South Dakota, Attorneys for defendant and appellee.
[¶ 1.] This is an appeal from a judgment crediting a payment received by Robert E. Nelson (Nelson) from Sunshine Partners Limited Partnership (Sunshine) against an obligation Donald A. Schellpfeffer (Schellpfeffer) owed Nelson under a separate agreement (Agreement). We affirm.
[¶ 2.] Schellpfeffer is one of two general partners and a limited partner in Sunshine. Sunshine was organized for the purpose of acquiring and eventually selling a certain parcel of commercial real estate in Tucson, Arizona.
[¶ 3.] In late 1989 Schellpfeffer approached Nelson, soliciting investment in Sunshine. Nelson was reluctant. Schellpfeffer offered to eliminate Nelson's risk by promising to repay him the amount of his Sunshine investment together with twelve percent interest per annum on demand. Nelson accepted. The Agreement was reduced to writing and signed by the parties. It reads:
The parties agree to the following facts:
[¶ 4.] Over the course of several years Nelson's capital cash contributions to Sunshine grew to $197,000. Although Nelson was aware of the pending sale of a substantial portion of the Sunshine property in Tucson, on June 28, 1999 he made written demand of Schellpfeffer pursuant to paragraph one of the Agreement. Thirty days passed without payment. Nelson then sued Schellpfeffer.
[¶ 5.] In answer to Nelson's complaint, Schellpfeffer raised, as an affirmative defense, that substantial sums were being held in escrow by Sunshine which, when released, would reduce the amount he owed Nelson. In December 1999, Sunshine issued a check to Nelson in the amount of $110,057.96, his share of the proceeds from the sale of Tucson property.
[¶ 6.] This case was tried piecemeal to the court in February, April, and July 2001. The only issue was whether Schellpfeffer's obligation to Nelson under the Agreement should be reduced by the payment Nelson received from Sunshine. The trial court found in Schellpfeffer's favor, concluding that to allow Nelson to collect his capital cash contributions in full from Schellpfeffer and to keep the $110,057.96 return of capital from Sunshine would be "unfair ... unreasonable ... and unconscionable," and contrary to the intent of the parties.
[¶ 7.] The issue Nelson brings before this Court on appeal is whether the trial court erred in its interpretation of the Agreement. Contract interpretation is a question of law and the matter is reviewed here anew. AFSCME v. Sioux Falls School Dist., 2000 SD 20, 605 N.W.2d 811; Hayes v. Northern Hills General Hosp., 1999 SD 28, 590 N.W.2d 243.
[¶ 8.] The goal of contract interpretation is to see to it that the mutual intent of the parties is carried into effect. Singpiel v. Morris, 1998 SD 86, 582 N.W.2d 715. The contract is to be read as a whole, making every effort to give effect to all provisions. Crowley v. Texaco, Inc., 306 N.W.2d 871 (S.D.1981). When the words of a contract are clear and explicit and lead to no absurd consequences, the search for the parties' common...
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