Sievert v. LaMarca
| Decision Date | 14 May 1985 |
| Docket Number | No. C2-84-1501,C2-84-1501 |
| Citation | 367 N.W.2d 580 |
| Parties | Howard P. SIEVERT, Appellant, v. Donald D. LaMARCA, et al., Respondent, First State Bank of Lakefield, Respondent, and Dawn Sievert, additional party to counterclaim, Appellant. and FIRST STATE BANK OF LAKEFIELD, Respondent, v. Donald D. LaMARCA, et al., Respondents, Howard P. Sievert, Appellant. |
| Court | Minnesota Court of Appeals |
Syllabus by the Court
1. The trial court did not deprive appellant of a fair trial.
2. The trial court did not err in failing to direct a verdict in favor of appellant.
3. The trial court did not err in finding that appellant is not entitled to a mechanic's lien against respondent LaMarca's home.
4. The trial court did not err in denying appellant's motion for a new trial based on insufficiency of the evidence or excessive damages award. Ordinarily, comparative fault does not apply to contract cases. However, since no party objected to the special verdict submitting both contract and negligence theories, the instruction of the trial court became the law of the case. The court's error in instructions requiring proof by clear and convincing evidence for 5. The trial court erred in applying the doctrine of equitable estoppel to prevent respondent First Lakefield from foreclosing its mortgage against the Sievert farm under the assignment of a contract for deed.
fraud was not reversible because appellant-plaintiff, under the facts, had no basis for a fraud claim. Reliance on a future expectancy does not provide a basis for fraud. The instruction should have required only a fair preponderance of the evidence.
6. The trial court erred in computing the judgment amount awarded to respondent LaMarca as a result of appellant's negligence.
7. Respondent LaMarca is not entitled to damages and double costs under Minn.R.Civ.App.P. 138.
James Malcolm Williams, Minneapolis, for appellant.
John I. Halloran, Lacklan B. Muir, Minneapolis, for LaMarca et al.
J. David Jackson, Minneapolis, for respondent.
Heard, considered and decided by NIERENGARTEN, P.J., and FOLEY and LESLIE, JJ.
This case involves the financing and construction of a home for Dr. Donald LaMarca. The project was financed with loans from the First State Bank of Lakefield to LaMarca and to general contractor Howard Sievert. The loan to LaMarca was secured by a mortgage on the home, and the loan to Sievert by assignment of a contract for deed on Sievert's farm. LaMarca promised to pay Sievert and the bank from the proceeds of the sale of property in Illinois. LaMarca did not pay Sievert. Both he and Sievert defaulted on their respective bank loans.
Sievert brought a mechanic's lien foreclosure action claiming his lien took priority over the bank mortgage against the LaMarca house. LaMarca crossclaimed for negligent construction. The bank sought to foreclose on the mortgage and the contract for deed to satisfy LaMarca's and Sievert's respective debts, and Sievert counterclaimed against both LaMarca and the bank for breach of contract and fraud.
The case was tried to the court with an advisory jury by consent of the parties under Minn.R.Civ.P. 39.02. The trial court found that Sievert is not entitled to a mechanic's lien against the LaMarca home. The bank mortgage takes priority over all other claims. It ordered sale of the LaMarca house to satisfy the mortgage. The special verdict of the jury resulted in rulings adverse to appellant Sievert on the negligence issues, contract issues, fraud and damages.
The court also found that the bank has an equitable mortgage against the Sievert farm. However, despite the absence of fraud or breach of contract by the bank, the court concluded that the bank is equitably estopped from foreclosing that mortgage. It reformed the payment schedule for Sievert's loan.
Finally, upon the special verdict, the court found no fraud by LaMarca or the bank. It held that damages caused by Sievert's negligent construction of the home exceeded the amount LaMarca owed Sievert for the project. The court entered judgment for LaMarca against Sievert for the difference.
Sievert appeals, seeking cancellation of the bank's equitable mortgage, cancellation of his debt to the bank, entry of judgment on his mechanic's lien claim, and a new trial on his claims against LaMarca and the bank. The bank cross-appeals, seeking leave to foreclose its equitable mortgage against the Sievert farm. LaMarca seeks correction of a computation error and double costs and attorney fees under Minn.R.Civ.App.P. 138 for those portions of the appeal which he claims are frivolous.
In February 1977, Dr. Donald LaMarca moved to Lakefield, Minnesota from Glen Ellyn, Illinois. That fall he hired Howard Sievert to construct a luxury home for his family. According to LaMarca, his architect, and the building permit application, Sievert agreed to build the home for $180,000. According to Sievert, the project was a "materials and labor contract."
The First State Bank of Lakefield advanced LaMarca $125,000 to finance the home. The loan was secured by a mortgage on the property. LaMarca assured the bank that the loan would be repaid from the proceeds of the sale of his home in Illinois.
In January 1978, the bank informed LaMarca that it would not lend him additional money to complete the house. LaMarca asked Sievert to obtain a construction loan to complete the project. According to LaMarca, he promised Sievert that he would repay the bank $55,000 of whatever amount Sievert borrowed. That figure represented the quoted purchase price less the money already advanced Sievert for construction of the house. ($180,000 - $125,000). According to Sievert, LaMarca promised to repay all of the loan applied to construction of the LaMarca house.
Sievert borrowed $177,000 from the First State Bank. He and his wife assigned to the bank a contract for deed to a farm as security. According to Sievert and his wife, LaMarca and bank president Bernard Rue induced him to put up his farm as collateral by promising that he would be paid first from the proceeds of the sale of LaMarca's Illinois house. Rue assumed that Sievert would be repaid from the proceeds, but denied any bank guarantee of repayment by LaMarca.
According to Sievert and some of the workers, construction was slowed and costs elevated by lack of detailed plans and by LaMarca's frequent change of orders. LaMarca countered that he merely demanded some work be redone because of shoddy construction. LaMarca, his architect, and a building contractor testified concerning the home's numerous structural and cosmetic defects.
LaMarca's family moved into the partially completed house in November 1978. Later that month, the home was damaged by a boiler fire. After the fire, the parties had a falling out, and Sievert ceased work on the home. LaMarca took over supervision and payment of workers.
In May 1979, LaMarca sold his Illinois home. From the proceeds he paid the bank $32,500 and Sievert $10,000. Neither LaMarca nor the bank informed Sievert that the Illinois house had been sold until the proceeds had been fully disbursed.
LaMarca moved from Lakefield in September 1979 and ceased making payments on his bank loan in 1981. Sievert failed to pay his bank loan when it fell due in January 1980.
1. Was Sievert denied a fair trial by:
a. the bank's leading cross-examination of LaMarca,
b. admission of testimony by a caretaker and a housing contractor, and/or by
c. jury misconduct?
2. Did the trial court err in submitting the following issues to the jury:
c. diversion of funds by Sievert, and/or
d. Sievert's negligence in construction of the home?
3. Did the trial court err in finding as a matter of law that Sievert is not entitled to a mechanic's lien against the LaMarca house?
4. Did the trial court err in denying appellant's motion for a new trial on the following grounds:
a. the evidence was insufficient to support the verdict;
b. excessive damages award;
c. error in jury instructions on the burden of proof for fraud?
5. Did the trial court err in prohibiting foreclosure of the bank's equitable mortgage?
6. Did the trial court err in its computation of the judgment against Sievert in favor of LaMarca?
7. Was respondent LaMarca entitled to attorney fees and double costs under Minn.R.Civ.App.P. 138?
1(a). The trial court did not abuse its discretion in allowing the bank, over Sievert's objection, to ask leading questions during its cross-examination of LaMarca. Minn.R.Evid. 611(c) permits leading questions on cross-examination.
1(b). Without further explanation, Sievert contends that the trial court "erroneously allowed unqualified farmers to testify as construction engineers as to standards of care, damages and, by implication, causality." He is apparently referring to testimony by caretaker Roger Hotzler and housing contractor Donald Jensen.
Hotzler testified only as to the physical appearance of the house as foundation for admission into evidence of photographs he took of the house. Jensen's qualifications as an expert in home construction were established by his testimony that he built between 60 and 70 houses during his 35 years in the construction business. A trial court has broad discretion in determining the sufficiency of the foundation laid for an expert opinion, and its decision will not be reversed except for a clear abuse of that discretion. Wenner v. Gulf Oil Corp., 264 N.W.2d 374, 382 (Minn.1978). Here, the court did not abuse its discretion.
1(c). Sievert contends that during voir dire one juror tried to get excused by asking questions and leaving the jury box. When this failed, the juror allegedly tried to contact LaMarca's attorney to retain him in a separate matter. However, there is no evidence in the record to support the misconduct claim. Sievert did not take any of the...
To continue reading
Request your trial
-
1999 -NMSC- 6, Allsup's Convenience Stores, Inc. v. North River Ins. Co.
...with the option of objecting to comparative fault questions, even though contract issues were involved. See Sievert v. LaMarca, 367 N.W.2d 580, 583 (Minn.App.1985) (where special verdict submitted both contract and negligence theories in comparative fault form, and no party objected, instru......
-
Gopher Oil Co., Inc. v. Union Oil Co. of California
...rescission of a written agreement. Martin v. Guarantee Reserve Life Ins. Co., 155 N.W.2d 744, 748 (Minn.1968); Sievert v. La Marca, 367 N.W.2d 580, 588-89 (Minn.Ct.App.1985). The circumstances of this case do not rise to the level of plain error. The district court based its instructions on......
-
State by Humphrey v. Alpine Air Products, Inc., C8-92-740
...by clear and convincing evidence, especially where a party seeks to avoid the effects of a written instrument. In Sievert v. LaMarca, 367 N.W.2d 580, 589 (Minn.App.1985) (common law fraud action), pet. for rev. denied (Minn. July 17, 1985), this court Whatever the basis for the Weise holdin......
-
Taylor v. Sheehan, C9-88-1259
...concluded in accordance withMartin v. Guarantee Reserve Life Insurance Co., 279 Minn. 129, 155 N.W.2d 744 (1968) and Sievert v. LaMarca, 367 N.W.2d 580 (Minn.Ct.App.1985), pet. for rev. denied (Minn. July 17, 1985) that the fair preponderance of the evidence standard was the proper standard......