TNT Cattle Co. v. Fife
| Decision Date | 31 January 2020 |
| Docket Number | No. S-18-1067.,S-18-1067. |
| Parties | TNT CATTLE COMPANY, INC., appellee, v. Dianna FIFE, appellant. |
| Court | Nebraska Supreme Court |
Jack W. Besse, of Parker, Grossart & Bahensky, L.L.P., Kearney, for appellant.
Siegfried H. Brauer, of Brauer Law Office, for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke, Papik, and Freudenberg, JJ.
This appeal involves a dispute between an out-of-state landlord and her tenant as to the duration of their farm lease agreement. Two writings were considered by the court as embodying their agreement, one which stated that the "lease period will go from January 2007 until December 2017 a ten year period" and the other providing that "[t]he land will be maintained ... from January 2007 until December 2017." The court found for the tenant that there was an 11-year lease and awarded damages for breach of contract. The landlord argues on appeal that the lower court lacked jurisdiction to issue the judgment, because title to the farmland was transferred into a trust before the tenant was evicted, and that therefore, the landlord in her capacity as sole trustee of the trust was an indispensable party. On the underlying merits, the landlord asserts that the lease was for 10 years and that, in any event, an oral modification replaced the written agreement such that an oral year-to-year lease governed when she gave notice of termination. The landlord also argues that the district court’s calculation of the tenant’s damages was based on speculative and conjectural evidence. We affirm the judgment below.
Rowland Trampe is the sole owner and president of TNT Cattle Company, Inc. (TNT). He entered into a long-term lease agreement with Dianna Fife to lease farmland located at "Section Twenty-Six (26), Township Ten (10) North, Range Seventeen (17), West of the 6th P.M., Buffalo County, Nebraska" (Fife farm). When Fife indicated to Trampe that he should vacate the Fife farm before the end of the lease term as understood by Trampe, TNT sued Fife. The fundamental disagreement between TNT and Fife was whether their written agreement provided that the lease period would end in December 2016 or in December 2017 and, further, whether a subsequent oral agreement to change the crops grown on the Fife farm rescinded the written agreement such that they were operating under an oral year-to-year lease when Fife advised Trampe the tenancy would be ending.
TNT’s original complaint was filed on April 19, 2017, and relied on a singular document containing the parties’ notarized signatures and stating that the "lease period will go from January 2007 until December 2017 a ten year period." An amended complaint claimed that this document in conjunction with another document executed at the same time constituted the written agreement between the parties. The other document, containing the notarized signatures of the parties dated the same as the first document, described that "[t]he land will be maintained by TNT ... from January 2007 until December 2017," without mention of a "ten year period."
TNT alleged in its original complaint filed on April 19, 2017, that "[Fife] has forwarded certain communications to [TNT] within the last few months that taken together indicate that [Fife] intends to breach the Lease and deny [TNT] possession of and access to the [Fife f]arm for the 2017 crop year." More specifically, TNT alleged Fife had asserted that the lease would terminate as of December 31, 2016, and that she had the right to exclude TNT after that date. TNT sought injunctive relief from any action by Fife to terminate the lease or dispossess TNT from the Fife farm before December 31, 2017; declaratory judgment that the lease ran through December 31, 2017; and damages for anticipatory breach of the lease. In the amended complaint, filed on September 14, 2017, TNT repeated the allegations of the original complaint, alleging still that TNT’s "anticipated dispossession" for the 2017 crop year would cause TNT irreparable harm and that in the event TNT is not granted injunctive relief, it would suffer damages for lost profits from the 2017 crop year.
Fife, in her answers, alleged that the parties had agreed that the lease term would end on December 31, 2016, and that any reference to "December 2017" was a mistake that should be construed against TNT, which she alleged was the scrivener. She alleged that, in any event, the long-term lease agreement was no longer controlling, because it was subsequently modified to an oral year-to-year lease. Fife counterclaimed against TNT for an accounting of her crop share during the course of their lease agreement, intentional interference with the contractual relationship with a lease agreement between "defendant" and a new tenant, and trespass, when Trampe allegedly allowed his cattle to graze on stalks on the Fife farm in the fall and winter of 2009 through 2012. TNT did not file any pleading in response to the counterclaim.
After a pretrial hearing, the court found the evidence insufficient to warrant a temporary injunction, reasoning that TNT had failed to establish a clear right to an injunction by virtue of the lease agreement, because that agreement was ambiguous. A bench trial was held on permanent injunctive relief and the underlying claims of declaratory judgment and breach of contract, bifurcating the trial on the underlying merits of these claims from a determination of any damages. Trial on Fife’s counterclaim was postponed until after the court’s determination on Fife’s claims. The court ultimately found that injunctive relief was moot, but found in favor of TNT for breach of contract and awarded TNT damages.
The evidence at trial demonstrated that Fife had purchased the Fife farm in January 2003 and that from that time until 2008, Trampe farmed the land under an oral year-to-year arrangement. Prior to Fife’s acquisition, Trampe had been farming the land for the previous landlord.
Trampe testified that in the summer of 2007, he and Fife began discussing putting an irrigation pivot on the Fife farm in order to utilize all the approved irrigated acres and thereby not lose the Fife farm’s designation with the U.S. Department of Agriculture Farm Service Agency. Trampe noted that the dry hay was "becoming older hay and was going to fizzle out" anyway.
Trampe offered to assist at his own expense with some of the "dirt work" necessary for installation of a pivot so long as he could recoup that investment through a 10-year lease. The pivot was installed and began operation in 2008 for the 2008 farm year.
According to Trampe, he understood that the 10-year lease period would commence once the pivot was in place. Trampe explained that when negotiating the new arrangement, he was aware that the pivot would not be installed until the spring of 2008. Thus, he understood that the duration of the new lease would be for one final year of dryland hay production plus 10 years of irrigated row crop production.
Fife acknowledged multiple telephone conversations with Trampe generally pertaining to installation of pivot irrigation, but she could not recall "anything at all" with respect to what was said.
Trampe testified that after discussing the matter at length over the telephone, Fife mailed a lease document to him with the crops and percentages left blank. The original draft lease agreement sent by Fife with items left blank was entered into evidence as exhibit 4. Trampe explained that he had found the document the night before the trial.
The document as sent by Fife originally provided: "The land will be maintained by TNT Cattle Co., ... from January 2007 until December 20__." Further, several lines of the document described that "[c]rop percentage will be __% for the sale of [specified crop]," alternating "for TNT Cattle Co." and "for Dianna S. Fife Trust." These lines specified alfalfa, soybeans, and corn. Four similar lines following left the crop blank. The document provided that "None of Dianna S. Fife heirs may contest this contract."
The forwarding letter, exhibit 3, which Trampe had also located the evening before trial, stated in relevant part:
I am enclosing a rough draft of a contract for us to sign. See what you think and let me know. If you like it, just fill in the number of years in the blank and the percentage of crops etc. You can re-type it if you like. I think you will need to initial the % areas when you go to a Notary. I will have to do the same so they know we both agree on it. You can go to a Notary and then send them to me and I will sign them in front of a Notary. I will send your copy back to you and I will keep a copy. I have no problem with the number of years you want to work the land. I don't plan to sell it for a long time.
Fife did not recall the letter, but acknowledged that her signature was on it.
The blank for the end date of the lease period in exhibit 4 was filled in by Trampe as 2017. Trampe filled in the percentages for the sale of alfalfa as 50 percent to TNT and 50 percent to the "Dianna S. Fife Trust." Trampe filled in the blanks for the lines pertaining to soybeans and corn as 66.7 percent to TNT and 33.3 percent to the "Dianna S. Fife Trust." The four other lines were simply left blank. Trampe then signed the agreement in the presence of a notary.
Fife objected to the admission of exhibits 3 and 4 on the grounds of foundation and unfair surprise. The court overruled the objections and admitted exhibits 3 and 4 into evidence.
Trampe testified that based on the letter and exhibit 4, he had created another document, exhibit 1, which provided in full:
Rowland Trampe owner and operator of TNT Cattle Co. Inc. agrees to rent the farm ground from Dianna Fife in section 26 T-10-N-R-17-W in Grant township. The lease period will go from January 2007 until...
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