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Benz Farm, Llp v. Cavendish Farms

September 15, 2011

BENZ FARM, LLP,
PLAINTIFF AND APPELLANT
v.
CAVENDISH FARMS, INC., DEFENDANT AND APPELLEE



Appeal from the District Court of Stutsman County, Southeast Judicial District, the Honorable Daniel D. Narum, Judge.

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

N.D. Supreme Court

Benz Farm, LLP v. Cavendish Farms, Inc.,

2011 ND 184 This opinion is subject to petition for rehearing. [Go to Documents]

[Download as WordPerfect]

AFFIRMED.

Opinion of the Court by VandeWalle, Chief Justice.

[¶1] Benz Farm, LLP ("Benz") appealed from a summary judgment dismissing its action against Cavendish Farms, Inc. ("Cavendish") for breach of contract and violation of the Unlawful Sales or Advertising Practices Act, N.D.C.C. ch. 51-15, and awarding Cavendish attorney fees. We affirm, concluding: (1) the district court did not err in granting summary judgment dismissing Benz's breach of contract claims; (2) the Unlawful Sales or Advertising Practices Act does not apply to, or create a cause of action against, a purchaser; (3) the district court did not abuse its discretion in denying Benz's motion to amend its complaint; and (4) the district court did not err in awarding Cavendish attorney fees.

I

[¶2] Cavendish owns and operates a potato processing facility in Jamestown. Benz is a limited liability partnership that grows and sells potatoes.

[¶3] In 2006, Cavendish and Benz entered into written agreements for the sale and purchase of potatoes. One was a "Grower Storage Agreement," under which Benz agreed to grow and sell, and Cavendish agreed to buy, 150,000 hundredweight of potatoes, to be stored after harvest by Benz until Cavendish directed they be delivered to its processing plant. The second agreement was a "Company Storage Agreement," under which Benz agreed to grow and sell, and Cavendish agreed to buy, 113,000 hundredweight of potatoes, to be delivered to and stored by Cavendish. The parties also entered into a written credit agreement, whereby Cavendish agreed to provide financing for Benz's expenses in growing the potatoes.

[¶4] Both storage agreements contained detailed provisions specifying quality requirements for the contracted potatoes, and Cavendish was not required to purchase any potatoes that fell below certain minimum quality standards. The agreements also provided that "[t]he potatoes will be grown on the fields designated in Exhibit A, which is attached and incorporated herein." At the time of signing the agreements there was no "Exhibit A," and the parties had not agreed on a designation of which fields would be stored by Benz and which by Cavendish. Benz subsequently submitted "Field Detail Forms" specifying the varieties of potatoes planted and other details, including which fields would be stored under each contract, but those forms were not signed by Cavendish.

[¶5] In September 2006, after Benz began delivering potatoes to Cavendish under the Company Storage Agreement, testing by an independent quality grading service revealed that the potatoes were affected by rot and pink eye and did not meet the minimum quality specifications of the contract. Cavendish expressed concern about accepting the potatoes into its storage facility because the problems could spread to the other potatoes stored there. Monte Benz, one of the Benz partners, suggested they could "switch fields," storing the potatoes from the affected fields in Benz's storage facilities and delivering better-quality potatoes from other fields for storage by Cavendish. Benz claims that the parties orally agreed to "switch fields" and that Cavendish also agreed to modify the delivery schedule and call for delivery of the deteriorating potatoes "as soon as possible" or within thirty days. Cavendish ultimately accepted delivery and paid for 80,000 hundredweight of the affected potatoes, but Benz disposed of the remaining 70,000 hundredweight as hog feed.

[¶6] In 2007, the parties entered into a Company Storage Agreement. Benz claims that there were numerous oral agreements regarding the dates that Cavendish would accept deliveries, but that Cavendish accepted only limited deliveries on those dates, causing inefficiencies and additional expenses for Benz.

[¶7] Benz brought this action against Cavendish in December 2008, alleging various claims and theories of liability. For purposes of our resolution of this appeal, Benz alleged that the parties had orally modified their 2006 written agreements and that Cavendish had breached the oral agreement by not timely calling for delivery of the deteriorating potatoes. Benz also alleged that Cavendish violated the Unlawful Sales or Advertising Practices Act, N.D.C.C. ch. 51-15, and breached oral agreements regarding delivery dates under the 2007 contract. Cavendish answered and sought attorney fees as allowed under the parties' written agreements.

[ΒΆ8] Cavendish moved for summary judgment dismissing Benz's claims. Benz filed a response to the motion for summary judgment and moved to amend its complaint to add new legal theories and claims for damages. The district court denied the motion to amend the complaint, ordered ...


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