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Skaw Nd Precast, LLC v. Oil Capital Ready Mix, LLC

Supreme Court of North Dakota

December 12, 2019

Skaw ND Precast, LLC, Plaintiff and Appellee
v.
Oil Capital Ready Mix, LLC, Agape Holdings, LLP, Scott Dyk and Samuel Dyk, Defendants and Appellants

          Appeal from the District Court of Williams County, Northwest Judicial District, the Honorable Paul W. Jacobson, Judge.

          David A. Tschider, Bismarck, ND, for plaintiff and appellee.

          Mark A. Schwab, West Fargo, ND, for defendants and appellants.

          OPINION

          VANDEWALLE, CHIEF JUSTICE.

         [¶1] Oil Capital Ready Mix, LLC; Agape Holdings, LLP; Scott Dyk; and Samuel Dyk (collectively "Dyk") appealed from a judgment awarding Skaw ND Precast LLC ("Skaw") $69, 295 in damages for conversion of its property. Because the district court's findings of fact are not clearly erroneous, we affirm the judgment.

         I

         [¶2] In March 2013, Skaw, a company which manufactures and sells precast concrete items, entered into a five-year agreement with Tioga Ready Mix ("Tioga"), a company which produces ready-mix concrete product, to rent a two-acre parcel of land to conduct its business. The base rent for the site was $700 per month, subject to reductions if Skaw purchased designated quantities of ready-mix product from Tioga. The agreement provided it would remain in effect until December 31, 2018, and it did not allow either party to unilaterally cancel the agreement.

         [¶3] In spring 2015, Skaw learned that Tioga had arranged to sell Tioga's assets at a public auction, including the two-acre parcel of property where Skaw conducted its business. Skaw's owners attended the auction sale in May 2015. The auction service notified all attendees that Skaw's assets on the premises were not part of the sale, that there was a lease in place between Skaw and Tioga, and that the lease went with the land. Dyk was the successful bidder at the auction and entered into a commercial purchase agreement with the sellers which did not include Skaw's product inventory or equipment and stated the sale was subject to "rights of tenants," but did not list Skaw as a tenant. Once Dyk got its ready-mix plant running, Skaw began purchasing concrete ready-mix product from Dyk for its business.

         [¶4] In August 2015, Dyk requested and was provided a copy of the March 2013 agreement between Skaw and Tioga. Dyk's attorney informed one of Skaw's owners that the agreement between Skaw and Tioga "is no longer capable of being performed" and that "we need to come to terms." Dyk attempted to renegotiate the terms of the 2013 agreement, and Skaw agreed to increase its monthly rental payments to $750 per month.

         [¶5] On September 23, 2015, Dyk mailed a "notice of non-renewal of lease" to Skaw stating:

PLEASE TAKE NOTICE that the lease under which you hold possession of the above described property will terminate pursuant to its own terms on November 22, 2015 and will not be renewed for a new term, nor allowed to be converted to a month-to-month tenancy. Please do not tender any money that will pay rent beyond the end of the term. Please further be advised that any money tendered, if accepted will have been accepted in error and will be returned.
PLEASE TAKE FURTHER NOTICE that you are required to surrender the premises to Samuel Dyk upon the termination date. Please return the premises in the same condition as you found it upon move-in, normal wear and tear excepted. Furthermore, you are required to return all keys upon vacating the premises. Failure to vacate the premises on or before the termination date will result in legal proceedings against you to recover possession of said premises.

         During late 2015, both Skaw and Dyk shut down operations for the winter offseason. Skaw did not comply with Dyk's "notice."

         [¶6] During the winter, Dyk built an earthen berm around Skaw's equipment which prevented Skaw from accessing it. Dyk also transported Skaw's concrete pad and block inventory off of Skaw's two acres to an area adjacent to Dyk's offices. Other Skaw assets were transported to undisclosed locations. When Skaw discovered the berm had been constructed and its assets had been moved, Dyk informed Skaw that Skaw had abandoned their temporary rental agreement in December 2015 and that law enforcement would be notified if there were "any attempts to breach the peace or trespass" on the property. Skaw replied that the 2013 lease was still valid and had not been ...


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