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A & R Fugleberg Farms, Inc. v. Triangle Ag

April 7, 2010

A & R FUGLEBERG FARMS, INC., RANDY FUGLEBERG, NICK FUGLEBERG, AND JEREMY FUGLEBERG, PLAINTIFFS,
v.
TRIANGLE AG, LLC AND COOPERATIVE FINANCE ASSOCIATION, INC., DEFENDANTS.



The opinion of the court was delivered by: Ralph R. Erickson, Chief Judge United States District Court

ORDER ADOPTING IN PART AND REVERSING IN PART THE MAGISTRATE JUDGE'S REPORT AND RECOMMENDATION

The undersigned judge referred Plaintiffs' Motion for Summary Judgment and Defendant Triangle Ag, LLC's Motion to Dismiss to the magistrate judge for preparation of a Report and Recommendation (Doc. #65). The Court has received a Report and Recommendation from the Honorable Karen K. Klein, United States Magistrate Judge, pursuant to 28 U.S.C. § 636, recommending that Counts 1, 2, and 3 be dismissed, that material questions of fact preclude the dismissal of Count 4, that summary judgment is premature as to Count 5, and that Plaintiffs' motion for summary judgment be denied in its entirety.

On March 18, 2010, Plaintiffs filed objections to the Report and Recommendation (Doc. #78). Plaintiffs contend that the magistrate judge misapplied the law and failed to view the evidence in the light most favorable to the nonmoving party. Rule 72(b)(2), of the Federal Rules of Civil Procedure, provides that a party may respond to another party's objections within 14 days. Defendant Triangle Ag's response was due on April 1, 2010, but it was not filed until April 5, 2010. While the response is technically untimely, the Court finds no prejudice to Plaintiffs in considering Triangle Ag's responsive brief. Now, therefore, the Court has conducted a de novo review of those portions of the Report and Recommendation Plaintiffs object to and carefully reviewed the entire file. For the reasons explained below, the Report and Recommendation is ADOPTED in part and REVERSED in part.

SUMMARY OF DECISION

Neither the statute of frauds nor the parol evidence rule bars Plaintiffs' claims and thus the Court adopts the magistrate judge's recommendation that Defendant Triangle Ag's motion to dismiss on these grounds be denied. The parties have not had an opportunity to conduct discovery with regard to any of the claims; therefore, summary judgment is premature as to all claims. To the extent that the Report and Recommendation is contrary to this conclusion, it is reversed. Further, based on the limited evidence in the record, there are genuine issues of material fact precluding summary judgment as to each of the claims. Accordingly, Plaintiffs' motion for summary judgment is DENIED as to each claim and Defendant Triangle Ag's motion to dismiss/for summary judgment is DENIED as to each claim. To the extent that the Report and Recommendation is contrary to this conclusion, it is reversed.

FACTUAL BACKGROUND

Plaintiffs entered into an oral contract to purchase fertilizer from Triangle Ag (Doc. #6, Aff. Wes Roll ¶ 5). The contract price was for a total amount of $381,150.00, which Plaintiffs paid up front (Id.). Plaintiffs financed the purchase price through a loan obtained from Cooperative Finance Association. While Plaintiffs and Triangle Ag agree there is a binding purchase agreement, they disagree about whether the contract included a cancellation provision. The limited evidence in the record on this issue consists of contradictory affidavits (Docs. #20, 21, 22, 55, 60).

Plaintiffs assert that Kevin Poppell and Brad Fronning, representatives of Triangle Ag, told them they could cancel the contract for $50 per ton on each ton of remaining fertilizer to be delivered plus pay interest on the loan with Cooperative Finance Association (Docs. #20, 21, & 22). Plaintiffs allege the cancellation provision was a material term of the purchase agreement, which induced them to enter into the contract. Brad Fronning counters that he did not agree that Plaintiffs could cancel the purchase agreement by paying $50 a ton (Doc. #55, Aff. Brad Fronning). Fronning admits to negotiations regarding a cancellation provision, but claims he told Plaintiffs that they would have to sign a written contract to include such a provision (Id.). Kevin Poppel, the other Triangle Ag representative involved in the contract, is no longer employed by Triangle Ag (Doc. #6, Aff. Roll ¶4). Further, Cooperative Finance Association avers that none of its employees or representatives told Plaintiffs they could avoid liability on the loan by repaying only the outstanding interest (Doc. #60, Aff. Bruce Mead).

SUMMARY JUDGMENT STANDARD

In considering a motion for summary judgment, in contrast to a motion to dismiss, a court may examine the pleadings, depositions, admissions, affidavits, interrogatories, and inferences to be drawn therefrom to determine whether summary judgment is appropriate. Delzer v. United Bank of Bismarck, 459 N.W.2d 752, 755 (N.D. 1990). The parties filed various affidavits. The magistrate judge converted Defendant Triangle Ag's motion to dismiss into a motion for summary judgment. In doing so, the evidence must be viewed in a light most favorable to the nonmoving party, and the nonmoving party enjoys the benefit of all reasonable inferences to be drawn from the evidence. Smith v. Ashland, Inc., 250 F.3d 1167, 1171 (8th Cir. 2001).

ANALYSIS

1. Statute of Frauds

Triangle Ag contends the oral contract is unenforceable under the statute of frauds. The magistrate judge's analysis of this issue is thorough and the undersigned agrees it is a correct interpretation of North Dakota law and hereby adopts the reasoning in its entirety. For the reasons stated in the magistrate judge's Report and Recommendation, Triangle ...


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