Articles Posted in Minnesota Supreme Court

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The clear-and-convincing standard applies when determining the existence of an oral contract for the conveyance of farmland when only money damages are sought for the claimed breach of that contract. Plaintiff argued that the Estates of his parents were obligated under an oral contract for the sale of land to convey farm property to him. After a second trial, the jury found by a preponderance of the evidence that an oral contract existed between Plaintiff and his parents and awarded Plaintiff damages for the breach of that contract. The Estates moved for judgment as a matter of law and a new trial, arguing that the district court instructed the jury on the incorrect standard of proof. The district court denied the motion. The court of appeals affirmed. The Supreme Court reversed and remanded the matter to the district court for a new trial, holding (1) the clear and convincing evidence is required to prove that an oral contract for the sale of land existed, regardless of whether the party seeks damages or specific performance; and (2) therefore, the district abused its discretion in denying Plaintiff’s motion for a new trial. View "Christie v. Estate of Dilman Christie" on Justia Law

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Claims brought against the manufacturer of a component part of an improvement to real property fell under an exception to the ten-year statute of repose because the improvement was “machinery installed upon real property.” See Minn. Stat. 541.051. Appellant manufactured the motor in a home’s heat-recovery ventilator. Sixteen years after the ventilator was installed, a fire started in the ventilator, causing property damage to the home. Respondent, the insurer of the homeowners, brought this subrogation action against Appellant. The district court granted summary judgment for Appellant, concluding that the ten-year statute of response for improvements to real property barred every claim except the claim alleging a post-sale duty to warn, which claim it dismissed upon summary judgment. The court of appeals reversed. The Supreme Court affirmed in part and reversed and remanded in part, holding (1) under the plain language of section 541.051, the ventilator containing Appellant’s motor was “machinery installed upon real property,” and therefore, the court of appeals properly reinstated Respondent’s breach of warranty, negligence, and product liability claims; and (2) Appellant did not have a duty to warn consumers of its product’s alleged defect after the time of sale. View "Great Northern Insurance Co. v. Honeywell International, Inc." on Justia Law

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At issue was whether an indemnity clause in a rental agreement required the renter to indemnify the rental company for the rental company’s negligence. The Tower Tap & Restaurant entered into an agreement to rent folding picnic tables from London Road Rental Center, Inc. for an event. Plaintiff injured his hip at Tower Tap’s event after one of the rented tables collapsed on him. Plaintiff sued Tower Tap and London Road. London Road filed a cross-claim against Tower Tap, seeking contractual indemnity based on the indemnity clause in the rental agreement. The district court granted summary judgment to London Road, concluding that the clause unequivocally covered liability for London Road’s own negligence. The court of appeals affirmed. The Supreme Court reversed, holding that the indemnity clause did not include express language that clearly and unequivocally showed the parties’ intent to transfer such liability to Tower Tap. View "Dewitt v. London Road Rental Center, Inc." on Justia Law

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A seller’s fraudulent statements about the fitness of a vehicle for the purpose for which it was purchased make disclaimers in purchase documents stating that the buyer purchased the vehicle “as is” ineffective. The district court in this case awarded relief to the buyer on both fraud and breach of warranty theories. The Supreme Court affirmed, holding (1) the buyer’s fraudulent statements about the fitness of the vehicle being sold for the purpose for which the vehicle was purchased made the “as is” disclaimers of implied warranties in the purchase documents ineffective under Minn. Stat. 336.2-316(3)(a); and (2) under the Uniform Commercial Code, a party may seek remedies for fraud, including breach of warranty, even after the rescission of a purchase contract, and therefore, the district court did not err in awarding damages under both fraud and breach of an implied warranty theories of liability. View "Sorchaga v. Ride Auto, LLC" on Justia Law

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Contrary to the holding of the district court, Appellant filed a timely legal-malpractice claim under Minn. Stat. 541.05(1)(5). Respondent, Appellant’s attorney, prepared an antenuptial agreement for Appellant and his then-fiancee, Cynthia Gatliff, but the agreement did not include statutorily required witness signatures, making it unenforceable. One year after Appellant married Gatliff, Respondent drafted a will for Appellant that incorporated the antenuptial agreement by reference. When Gatliff later filed for divorce, she alleged that the antenuptial agreement was invalid due to its lack of witness signatures. Appellant subsequently sued Respondent for legal malpractice. While the invalid execution of the antenuptial agreement fell outside the six-year limitations period for malpractice claims, Appellant argued that subsequent representations by Respondent that the anteuptial agreement was valid were separate legal-malpractice claims that each triggered their own statute of limitations periods. The district court granted Respondent’s motion for judgment on the pleadings, and the court of appeals affirmed. The Supreme Court reversed, holding that Appellant sufficiently alleged that Respondent’s will drafting formed the basis for a separate malpractice claims within the limitations period. View "Frederick v. Wallerich" on Justia Law

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Appellant BCBSM, Inc. (“Blue Cross”) denied respondent James Linn’s insurance claim because the requested treatment was not considered medically necessary under the parties’ health-plan contract. After Blue Cross denied the claim, an external-review entity determined that the treatment was, in fact, medically necessary for Linn’s condition. Blue Cross paid the claim, but Linn and his wife sued Blue Cross for breach of contract. The district court granted summary judgment for Blue Cross, concluding that the treatment was not medically necessary under the contract’s plain terms and that Blue Cross fulfilled its contractual obligations when it paid for the treatment following the external review. The court of appeals reversed. Because the Minnesota Supreme Court concluded: (1) external-review decisions were independent determinations of medical necessity that did not supersede contractual definitions of medical necessity; and (2) the health-plan contract plainly excluded coverage for Linn’s claim for treatment, the Court reversed. View "Linn v. BCBSM, Inc." on Justia Law

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Appellant suffered injuries after being hit by another driver. The at-fault driver’s liability insurer paid Appellant $100,000, the full amount available under the policy. Appellant made a settlement demand on State Farm, with whom he had an underinsured-motorist policy that also had a $100,000 coverage limit. State Farm offered less than $30,000 to settle the claim. Appellant filed a complaint against State Farm alleging breach of contract and claiming that he was entitled to the full amount recoverable under the policy. The district court ultimately entered judgment in the amount of $98,800. Thereafter, Appellant amended his complaint to add a claim under Minn. Stat. 604.18, which authorizes the award of “taxable costs” when an insurer denies benefits without a reasonable basis. The district court concluded that State Farm had denied Appellant insurance benefits without a reasonable basis. The court then determined that the “proceeds awarded” to an insured under section 604.18 are capped by the insurance policy limit. The court of appeals affirmed after determining that the state was ambiguous. The Supreme Court affirmed, holding that section 604.18 unambiguously caps “proceeds awarded” at the amount recoverable under the insurance policy. View "Wilbur v. State Farm Mutual Automobile Insurance Co." on Justia Law

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American Family Insurance Company (American Family) issued automobile insurance policies to policyholders that were later injured in automobile accidents. The policy contained an anti-assignment clause, but, in order to obtain medical treatment, the policyholders assigned their interests in basic economic loss benefits to their medical provider, Stand Up Multipositional Advantage MRI, P.A. (Stand Up). Stand Up filed suit against the policyholders, their attorneys, and American Family for failing to make payment directly to Stand Up in accordance with the assignments. The district court granted summary judgment for the defendants, concluding that the anti-assignment clause was unenforceable, and therefore, the assignments to Stand Up were valid. The court of appeals reversed. The Supreme Court affirmed, holding that the anti-assignment clause was valid and precluded the assignments the policyholders made to Stand Up. View "Stand Up Multipositional Advantage MRI, P.A. v. American Family Insurance Co." on Justia Law

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Mark Juelich and Steven Thoemke, former employees of Toyota-Lift of Minnesota, Inc. (TLM), claimed that TLM failed to pay them commissions they earned under their employment agreements with TLM. Juelich and Thoemke sought penalties under Minn. Stat. 181.14. The district court determined that TLM owed additional commissions to Juelich and Thoemke totaling $104,000 and that TLM was entitled to recover $815,000 from American Warehouse Systems, LLC (AWS) due to AWS’s breach of an asset purchase agreement entered into by AWS and TLM and its unjust retention of customer payments owed to TLM. The district court denied the request of Juelich and Thoemke for penalties under section 181.14, reasoning that the $814,000 judgment owed to TLM from AWS offset the unpaid commissions owed to Juelich and Thoemke. The court of appeals reversed, concluding that TLM was liable for statutory penalties under section 181.14. The Supreme Court affirmed, holding that when a court determines whether an employer is liable to an employee for the statutory penalty for nonpayment of wages under section 181.14, the court may not consider offsetting liabilities owed by the employee to the employer. View "Toyota-Lift of Minnesota, Inc. v. American Warehouse Sys., LLC" on Justia Law

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The Minnesota Department of Transportation (MnDOT) contracted with Mathy Construction Company for a public highway project. Mathy subcontracted with Storms, Inc. for excavation and fill work. After Storms completed its work, MnDOT issued a deductive change order reducing Mathy’s contract amount by $327,064 because of errors in the estimated quantities of excavation and fill required for Storms’ work. Mathy reduced Storms’ subcontract by the same amount. Storms subsequently sued Mathy for the reduction in the subcontract price. The district court granted summary judgment in favor of Storms, concluding that Mathy had breached the subcontract. The court of appeals affirmed. The Supreme Court reversed, holding that Mathy did not breach its subcontract with Storms by issuing a corresponding deductive change order to Storms. View "Storms, Inc. v. Mathy Constr. Co." on Justia Law