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Linda A. Smestad, Plaintiff and Appellee v. Bruce G. Harris

May 11, 2011

LINDA A. SMESTAD, PLAINTIFF AND APPELLEE
v.
BRUCE G. HARRIS,
DEFENDANT AND APPELLANT



Appeal from the District Court of Morton County, South Central Judicial District, the Honorable Robert O. Wefald, Judge.

The opinion of the court was delivered by: Crothers, Justice.

N.D. Supreme Court

Smestad v. Harris,

2011 ND 91

This opinion is subject to petition for rehearing. [Go to Documents]

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AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.

Opinion of the Court by Crothers, Justice.

Smestad v. Harris

No. 20100216

[ ¶1] Bruce G. Harris appeals from a judgment awarding Linda A. Smestad $30,025 plus interest for loans Smestad claimed she made to Harris during their 18-month relationship. We conclude the district court's findings that an oral agreement existed between the parties for Harris to repay Smestad $30,025 for the loans and that Harris failed to prove his counterclaims are not clearly erroneous. However, we further conclude the oral loan agreement is unenforceable under the statute of frauds in N.D.C.C. § 9-06-04(4). We affirm the judgment in part, reverse in part, and remand for further proceedings to consider Smestad's claim based on unjust enrichment.

I

[ ¶2] Smestad and Harris were involved in a personal and business relationship from spring 2007 through late 2008. The couple did not marry, but Smestad moved into Harris's Mandan home in November 2007. Harris owned and operated Oasis Water Systems, Inc. ("Oasis"), a Subchapter S corporation with Harris as the sole shareholder. Smestad worked as an engineering technician for the city of Bismarck and also had a part-time job. During their relationship, Smestad, using two checking accounts, wrote numerous checks to Harris, Oasis, and others on behalf of Harris and Oasis.

[ ΒΆ3] After the relationship ended, Smestad brought this action against Harris seeking more than $112,000 "as reimbursement/repayment for monies" she had provided to him. Smestad claimed the "funds were provided with the understanding of both parties that they were in the nature of loans, subject to immediate or on demand repayment." Harris denied the allegations in the complaint and asserted the statute of frauds as an affirmative defense. Harris also counterclaimed seeking "dissolution of informal ...


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