Ehlen v. Melvin
823 N.W.2d 780
| N.D. | 2012Background
- Ehlen offered to buy the Melvins’ real property for $850,000 with a March 1, 2011 closing deadline and attached an Amendment.
- The Melvins modified terms upon review (Feb. 18, 2011), adding as is sale, limited mineral rights, a wetlands easement, an agricultural lease, and removal of equipment.
- The Melvins handwritten and signed changes, then returned the documents to Ehlen, who did not respond further.
- Schmitz relayed that the deal was off, then later said it would resume, while the Melvins had no further direct contact with Ehlen.
- By March 1, 2011 the Melvins learned Ehlen had not paid or initialed the amendments; the Melvins’ attorney terminated the transaction in a March 2, 2011 letter.
- The district court found no mutual assent to a contract; the action to enforce the Purchase Agreement was dismissed with prejudice and costs awarded to the Melvins.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a contract existed due to mutual assent. | Ehlen contends the agreement was binding; he accepted counteroffers. | Melvins’ changes created a counteroffer; no mutual assent on same terms. | No contract; mutual assent lacking; changes constituted a counteroffer. |
| Whether Melvins’ modifications constituted an effective acceptance by Ehlen. | Ehlen accepted any counteroffer. | Acceptance required sign/initial on modified terms; no acceptance by Ehlen. | Acceptance not proven; Ehlen did not accept the modified terms. |
| Whether parol evidence rule or statute of frauds bars enforcement. | Parol evidence/self-contained written terms allow modification. | Modifications were in writing; no oral terms; statute of frauds not triggered. | Parol evidence rule and statute of frauds do not bar the outcome; no contract. |
Key Cases Cited
- Jerry Harmon Motors, Inc. v. First Nat. Bank & Trust Co., 472 N.W.2d 748 (ND 1991) (contract formation involves mutual consent and elements beyond legal questions)
- B.J. Kadrmas, Inc. v. Oxbow Energy, LLC, 2007 ND 12 (ND 2007) (mutual assent determined by objective manifestations; credibility not reweighed on appeal)
- Lire, Inc. v. Bob’s Pizza Inn Restaurants, Inc., 541 N.W.2d 432 (ND 1995) (mutual assent assessed by same means; secret intentions irrelevant)
- Berg v. Lien, 522 N.W.2d 455 (ND 1994) (acceptance must be absolute and within offer terms; counteroffers create rejections)
- Greenberg v. Stewart, 236 N.W.2d 862 (ND 1975) (acceptance with changes is a counteroffer unless terms agreeable to both sides)