Rose Creek Development Corp. v. Plaza Development Group, Inc.

• Decision Date: 30 March 1994
• Docket Number: No. 930238,930238
• Parties: ROSE CREEK DEVELOPMENT CORPORATION, a North Dakota corporation, and Fred M. Hector and Earlyne Hector, Plaintiffs and Appellants, v. PLAZA DEVELOPMENT GROUP, INC., a North Dakota corporation, and Larry S. Nygard and Richard P. Burns, Defendants and Appellees. Civ.
• Court: North Dakota Supreme Court

Page 368

514 N.W.2d 368

ROSE CREEK DEVELOPMENT CORPORATION, a North Dakota corporation, and Fred M. Hector and Earlyne Hector, Plaintiffs and Appellants, v. PLAZA DEVELOPMENT GROUP, INC., a North Dakota corporation and Larry S. Nygard and Richard P. Burns Defendants and Appellees.

Civ. No. 930238.

Supreme Court of North Dakota.

March 30, 1994.

Dan D. Plambeck, Stefanson, Landberg & Plambeck, Moorhead, MN, for plaintiffs and appellants.

David S. Maring, Maring Law Office, Fargo, for defendants and appellees.

VANDE WALLE, Chief Justice.

Plaintiffs Rose Creek Development Corporation and Fred and Earlyne Hector appeal from a district court order granting a preliminary injunction against plaintiffs, enjoining plaintiffs from breaching a development agreement with the defendants, Plaza Development Group, Inc., Larry S. Nygard and Richard P. Burns, and ordering plaintiffs to transfer property to defendants in accordance with the agreement. We dismiss the appeal.

Plaintiffs Fred and Earlyne Hector are officers and the sole shareholders in plaintiff Rose Creek Development Corporation (Rose Creek); defendants Nygard and Burns are officers and sole shareholders in defendant Plaza Development Group, Inc. (Plaza). The two corporations entered into a development agreement whereby they formed a joint venture known as Rose Creek Associates (the joint venture). The objective of the joint venture was to develop into residential housing approximately 328 acres of land in south Fargo, North Dakota. The development was to surround a golf course, which was constructed on land donated by the Hectors to the Fargo Park District.

The land to be contributed by Rose Creek and Plaza was divided into six numbered "additions". The agreement required the parties to transfer land comprising a particular addition once the joint venture sold, or obtained commitments to purchase, 40% of the lots in that addition.

In accordance with the agreement, Rose Creek transferred to the joint venture land comprising additions one, two, and three. However, Rose Creek has refused to transfer any more property and seeks legal dissolution of the joint venture. Rose Creek and the Hectors contend that defendants have breached the development agreement and have violated fiduciary duties owed to them as joint venturers. Plaza opposes dissolution, counterclaimed against Rose Creek, and sought a temporary injunction against Rose Creek. Plaza's counterclaim includes allegations of breach of contract, breach of fiduciary duty, fraud and misrepresentation, conversion, interference with business relations, and damage to reputation. A trial date has been set for resolution of these issues, pending this appeal.

The district court granted Plaza's motion for a temporary injunction against Rose Creek and, because the joint venture had obtained commitments for 40% of the lots in the sixth addition, ordered plaintiffs to transfer the land comprising the sixth addition to the joint venture. The court further ordered that "Plaintiffs are enjoined from breaching the Development Agreement dated July 12, 1989" and that "Plaintiffs are required to fulfill the duties and obligations owed by them to the joint venture in accordance with the Development Agreement and related joint venture agreements."

The district court certified the order granting the temporary injunction under Rule 54(b), NDRCivP, and this appeal followed. The order did not specify facts justifying certification, but ordered, "this order shall be deemed a final order and ... there is no just reason for delay in entry of a final order." Defendants objected to Rule 54(b) certification at the hearing and, although defendants have not raised the issue on appeal, we consider the propriety of Rule 54(b) certification of the injunction on our own motion. See Regstad v. Steffes, 433 N.W.2d 202 (N.D.1988). "[W]e are not bound by ...