Northstar Ctr. v. Lukenbill Family P'ship

• Docket Number: 20240034
• Decision Date: 21 November 2024
• Citation: Northstar Ctr. v. Lukenbill Family P'ship, 2024 ND 212, 20240034 (N.D. Nov 21, 2024)
• Parties: Northstar Center, LLC, Plaintiff and Appellee v. Lukenbill Family Partnership, LLLP, and Tundra Properties, LLC, Defendants and Appellants
• Court: North Dakota Supreme Court

1

2024 ND 212

Northstar Center, LLC, Plaintiff and Appellee v. Lukenbill Family Partnership, LLLP, and Tundra Properties, LLC, Defendants and Appellants

No. 20240034

Supreme Court of North Dakota

November 21, 2024

Appeal from the District Court of Williams County, Northwest Judicial District, the Honorable Joshua B. Rustad, Judge.

AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

Lisa M. Hettich(argued) and Garth H. Sjue(on brief), Williston N.D., for plaintiff and appellee.

Lawrence E. King, Bismarck, N.D., for defendant and appellantLukenbill Family Partnership, LLLP.

Erich M. Grant, Minot, N.D., for defendant and appellantTundra Properties, LLC.

OPINION

BAHR JUSTICE.

[¶ 1]Lukenbill Family Partnership, LLLP and Tundra Properties LLC appeal from a judgment entered after the district court granted Northstar Center, LLC summary judgment on Northstar's breach of contract claim against Lukenbill; granted Northstar summary judgment on its intentional interference with contract claim against Tundra; granted Lukenbill summary judgment on Lukenbill's indemnification claim against Tundra; and denied Tundra summary judgment on Tundra's breach of warranty claim against Lukenbill.We conclude the court erred by granting Northstar summary judgment on its breach of contract claim against Lukenbill; erred by granting Northstar summary judgment on its intentional interference with contract claim against Tundra; and erred by granting Lukenbill summary judgment on its indemnification claim against Tundra.Because genuine issues of material fact exist precluding summary judgment on Northstar and Lukenbill's claims, we reverse judgment on those claims and remand for further proceedings consistent with this opinion.We further conclude Tundra did not adequately brief whether the court erred in dismissing Tundra's breach of warranty claim against Lukenbill, and therefore waived the issue.We affirm judgment dismissing Tundra's breach of warranty claim.

I

[¶ 2] Lukenbill owned the disputed property in Williams County, North Dakota.In 2012, Lukenbill entered into a real estate contract ("agreement") to sell the disputed property to Templeton Enterprises, LLC.Templeton later transferred its rights under the agreement to Northstar.Ultimately, Lukenbill sold and transferred the disputed property to Tundra by warranty deed.

[¶ 3] The original agreement between Lukenbill and Templeton provided for the sale of a 120-acre parcel ("the disputed property") and the option to purchase another 105-acre parcel.The parties amended the agreement several times.A written amendment was made in February 2013 wherein Templeton and Lukenbill agreed, among other things, to sell the 105-acre parcel first with an option to purchase the 120-acre parcel:

The parties agree to amend the Purchase Agreement as follows:

l. The parties hereby agree to that the first closing on or before March 9, 2013 shall be for the 105 acres shown on exhibit A at the agreed price of $15,000.

2.The parties further agree that the remaining option shall be for the 120 acres shown on Exhibit A at the price of $16,000 which shall close on or before March 9, 2014.

3.The agreed increase in price due to the tax increase agreed in the original contract shall be due and payable [n]o later than January 1, 2014.The Taxes for the remaining options shall be due and payable no later than January 1, 2015.

4.All other terms and conditions remain the same.

Subsection 3 of the February 2013 amendment refers to provision 6(m) of the original agreement, which provides: "If said purchase increases capital gains liability to Seller, purchase price shall be increased proportionately."

[¶ 4]The parties closed on the 105-acre parcel on March 8, 2013.On March 8, 2013, the parties also agreed to an additional amendment(fourth addendum) regarding the disputed property:

1.The parties agree to amend said Purchase Agreement, and all addendums, as follows:

a. The initial described option to purchase 120 acres, at the price of $16,000 per acre, is hereby amended from an option to purchase, to a commitment to purchase the described 120 acres on or before March 9, 2014.

2.The parties also agree that a payment of 2% of the total purchase price shall be made to Jared Lukenbill, payable by the Buyer, upon closing.To the knowledge of the parties, this agreement constitutes the final agreement by and between Jared Lukenbill and the undersigned parties.

3.There shall be no further deposit of earnest money for the remaining 120 acres. .... 5.Lastly, the parties agree the tax increase set forth in the purchase agreement shall be calculated at a rate of 6.945%.

(Emphasis added.)The tax increase referred to in paragraph 5 of the fourth addendum again refers to paragraph 6(m) of the original purchase agreement.The same day, Templeton assigned its rights, title, and interest in and to the agreement to Northstar.

[¶ 5] On March 8, 2013, in connection with closing on the first parcel, Northstar signed a promissory note.In the promissory note, Northstar promised to pay Lukenbill $107,561 on or before January 1, 2014.The closing document shows the promissory note covers the payment for the "adjusted price" or "tax increase" referred to in provision 6(m) under the warranties of the seller.Northstar did not make payment before January 1, 2014.In March 2014, Northstar tendered, and Lukenbill deposited, $108,710 for the note, which included interest for late payment on the note.

[¶ 6] Lukenbill contracted to sell the disputed property to Tundra, setting a closing date of March 15, 2014.Tundra and Lukenbill closed on the 120-acre parcel, and Lukenbill gave Tundra a warranty deed for the property.

[¶ 7] Northstar filed a complaint against Lukenbill and Tundra.Northstar alleged Lukenbill breached the agreement and Tundra intentionally interfered with Northstar's agreement with Lukenbill.The parties moved for summary judgment.The district court granted summary judgment in part, concluding Northstar met the payment terms of the agreement by providing the promissory note before the payment date, and Lukenbill breached the contract by selling and conveying the disputed property to Tundra.The court later held a bench trial on the issue of Northstar's damages due to Lukenbill's breach of contract.

[¶ 8] Lukenbill added a crossclaim against Tundra for indemnification.Tundra answered and filed a counterclaim against Lukenbill, alleging breach of warranty deed.Lukenbill answered the counterclaim, arguing Tundra's claims are barred by equitable and promissory estoppel, unclean hands, and the guarantee of indemnity contained in the purchase agreement.The parties moved for summary judgment on the crossclaim and counterclaims.After a hearing, the district court granted Lukenbill's motion for summary judgment on the issue of indemnification by Tundra and denied Tundra's motion for summary judgment on the issue of indemnification and breach of warranty.

[¶ 9] Northstar moved for summary judgment on its claim of intentional interference with contract against Tundra.The district court granted Northstar's motion for summary judgment, concluding Tundra intentionally interfered with Northstar and Lukenbill's contractual relationship.

[¶ 10] Lukenbill and Tundra appeal the district court's judgment disposing of the parties' claims.

II

[¶ 11] Our standard for reviewing a grant of summary judgment is well-established:

Summary judgment is a procedural device for the prompt resolution of a controversy on the merits without a trial if there are no genuine issues of material fact or inferences that can reasonably be drawn from undisputed facts, or if the only issues to be resolved are questions of law.A party moving for summary judgment has the burden of showing there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law.In determining whether summary judgment was appropriately granted, we must view the evidence in the light most favorable to the party opposing the motion, and that party will be given the benefit of all favorable inferences which can reasonably be drawn from the record.On appeal, this Court decides whether the information available to the district court precluded the existence of a genuine issue of material fact and entitled the moving party to judgment as a matter of law.Whether the district court properly granted summary judgment is a question of law which we review de novo on the entire record.

Berger v. Sellers, 2023 ND 171, ¶ 7, 996 N.W.2d 329(citation omitted).

III

[¶ 12] Lukenbill argues the district court erred by granting Northstar's motion for partial summary judgment and concluding Lukenbill breached the agreement to sell and convey the disputed property.Lukenbill contends Northstar breached the terms of the contract and amendments by failing to pay $107,560.69 on or before January 1, 2014, relieving Lukenbill from its obligation to convey the disputed property under the agreement.

[¶ 13] Generally, "[t]he interpretation of a contract is a question of law.On appeal, this Court independently examines and construes the contract to determine if the district court erred in its interpretation."Bearce v. Yellowstone Energy Dev., LLC, 2019 ND 89, ¶ 14, 924 N.W.2d 791(internal citation omitted).

[¶ 14]"The elements of a prima facie case for breach of contract are: (1) the existence of a contract; (2) breach of the contract; and (3) damages which flow from the breach."Berger, 2023 ND 171, ¶ 21(internal citations omitted)."A breach of contract is the nonperformance of a contractual duty when it is due."Id.(emphasis added);see alsoBehle v. Harr, 2021 ND 190, ¶ 11, 965 N.W.2d 860("Absent repudiation and...