Brash v. Gulleson
2013 ND 156
| N.D. | 2013Background
- Janet L. Brash (individually and as personal representative of Dr. Larry Brash’s estate) sued William M. Gulleson after Gulleson returned only seven cows when Brash demanded the 130 cows encompassed by a 2000 written Cow/Calf Production Lease Agreement.
- The 2000 Agreement recited that the Brashes would furnish 130 cows then “presently situated on renter’s farm” and that Gulleson would give the Brashes 40% of the annual calf crop; it also stated the owner would provide replacements to maintain ~130 head.
- Gulleson acknowledged the written terms but asserted the 130 figure was a mistaken recitation of fact (a goal rather than actual herd size) and raised failure of consideration as an affirmative defense.
- At bench trial the district court found Dr. Brash had not maintained 130 cows (testimony and records showed herd decline to seven brood cows by 2004), allowed parol evidence to prove the actual herd size, and concluded there was a failure of consideration in performance.
- The court dismissed Brash’s claims with prejudice; on appeal the Supreme Court reviewed factual findings for clear error and affirmed the judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether parol evidence may be admitted to show failure of consideration in a written bailment/lease | Brash: parol evidence cannot vary a written contract; Gulleson may not reform or contradict the written terms without statutory grounds | Gulleson: parol evidence is admissible to prove failure of consideration (the 130-cow recitation was a mistaken factual statement) | Court: Parol evidence admissible to prove failure of consideration; district court did not err |
| Whether there was a failure of consideration (i.e., owner failed to furnish 130 cows) | Brash: the written Agreement required 130 cows and Gulleson breached by not returning animals or accounting for them | Gulleson: owner never had 130 cows; performance bargained-for never rendered, so contract became unenforceable | Court: Sufficient evidence supports finding of failure of consideration; not clearly erroneous |
| Whether Gulleson waived contract terms or breached duties as a bailee | Brash: Gulleson had custody and should be presumed negligent for missing cattle; owner entitled to statutory presumptions/judgment | Gulleson: he accounted for all cows actually entrusted and was not negligent; he complied with the agreement as performed | Court: Credited Gulleson’s accounting and testimony; found no proven breach by Gulleson |
| Whether trial court erred in relying on extrinsic evidence/course of dealing to construe the contract | Brash: extrinsic evidence cannot alter an unambiguous written contract | Gulleson: contract must be read with parties’ course of dealing; recited herd count was a factual recital subject to proof | Court: Contract permitted interpretation in light of circumstances and usage; court properly considered extrinsic evidence to determine intention and actual performance |
Key Cases Cited
- Taghon v. Kuhn, 497 N.W.2d 403 (N.D. 1993) (possession and degree of control determine bailment; bailment standards applied to cattle agreements)
- Tweeten v. Miller, 477 N.W.2d 822 (N.D. 1991) (temporary possession obligations and hirer duties under bailment law)
- Check Control, Inc. v. Shepherd, 462 N.W.2d 644 (N.D. 1990) (definition and effect of failure of consideration; standard of review for factual findings)
- Bakken v. Duchscher, 827 N.W.2d 17 (N.D. 2013) (contract interpretation principles: whole contract, circumstances, ambiguity analysis)
- Johnson Farms v. McEnroe, 568 N.W.2d 920 (N.D. 1997) (parol evidence admissible to show actual consideration differed from recital)