Gadeco v. Industrial Commission
2012 ND 33
| N.D. | 2012Background
- DSP and Becker appeal a district court judgment valuing Mark Rickert’s shares at dissolution (Dec. 2007) and rejecting an unwritten dissolution agreement.
- Becker sought to wind up DSP assets and obtain Mandan contract rights for herself, allegedly under an unwritten plan.
- Rickert demanded payment of fair value under N.D.C.C. § 10-19.1-87; DSP/Becker counterclaimed for unjust enrichment and argued no payment due.
- District court granted partial summary judgment that no implied/oral agreement to dissolve existed; a bench trial valued DSP at $557,273.
- Disputed issues included whether a statute of frauds precluded an unwritten dissolution agreement and whether partial performance removed the agreement from the statute.
- Appeal also challenged discovery rulings and the admissibility/impact of expert testimony (valuation) on damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Was there an enforceable unwritten dissolution agreement? | Rickert contends no enforceable unwritten agreement existed among shareholders. | DSP/Becker claim an unwritten agreement existed to dissolve in 2007 and transfer assets to Becker. | No enforceable unwritten agreement; statute of frauds bars. |
| Does partial performance remove an unwritten agreement from the statute of frauds? | Rickert argues partial performance would remove the contract from the statute. | DSP/Becker rely on years of profit sharing as partial performance. | Partial performance failed to establish consistent acts proving the unwritten contract; bar remains. |
| Did the district court properly apply the statute of frauds and related contract principles in summary judgment? | Rickert asserts no valid agreement; statute properly applied to bar claim. | Becker contends statute has exceptions and that written-like conduct supports enforcement. | Statute of frauds barred the unwritten dissolution agreement; summary judgment affirmed. |
| Were discovery rulings and expert-disclosure issues properly handled at trial? | Rickert contends discovery and expert procedures were proper and not unduly prejudicial. | DSP/Becker challenge discovery orders and acceptance of late expert testimony. | District court did not abuse discretion; discovery and expert rulings affirmed. |
| Was the valuation of DSP proper for purposes of a dissenting-shareholder remedy? | Rickert seeks fair value as of dissolution; valuation should reflect 2007 circumstances. | Becker/Becker supporters urge consideration of post-2007 profits to assess value. | Value properly determined as of dissolution date; post-2007 results irrelevant to fair value. |
Key Cases Cited
- First State Bank of Goodrich v. Oster, 500 N.W.2d 593 (N.D. 1993) (statute of frauds applies to contracts not performable within a year)
- In re Estate of Thompson, 2008 ND 144 (N.D. 2008) (partial performance must unmistakably point to the existence of the contract)
- Thompson v. North Dakota Workers’ Comp. Bureau, 490 N.W.2d 248 (N.D. 1992) (statute of frauds and partial performance discussion)
- Leno v. K & L Homes, Inc., 2011 ND 171 (N.D. 2011) (discovery discretion standard on appeal)
- Beaudoin v. JB Mineral Servs., LLC, 2011 ND 229 (N.D. 2011) (summary judgment and burden of production on issues of fact)