Thimjon Farms Partnership v. First International Bank & Trust
837 N.W.2d 327
| N.D. | 2013Background
- Northern Grain Equipment, LLC, a grain equipment dealer, had a line of credit with First International Bank & Trust secured by Northern Grain assets including its deposit account.
- Northern Grain contracted with Thimjon and Hagemeister to build grain-handling systems; First International was not a party to those contracts and had no communications with Thimjon or Hagemeister.
- Down payments from Thimjon and Hagemeister were deposited into Northern Grain’s account at First International.
- Northern Grain’s line of credit matured January 5, 2010, and Northern Grain later ceased operations; First International decided in December 2009 not to extend a future line of credit and did not inform Northern Grain.
- Between November 2009 and March 2010, First International repeatedly told Northern Grain financing could continue if it paid down its line of credit, encouraged new contracts, and applied down payments to the line of credit, then refused further financing, causing breach risks for Thimjon’s and Hagemeister’s contracts.
- The district court granted summary judgment for First International and denied the plaintiffs’ motions to amend; the actions were consolidated and appealed, with the court affirming.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Interference with contract viability | Thimjon/Hagemeister allege FI induced Northern Grain to breach by diverting down payments and withholding future financing. | FI’s actions were justified as a secured creditor collecting a debt; no improper interference. | Dismissed; FI’s actions justified as legitimate debt collection. |
| Unlawful interference with business | FI’s conduct, including pressuring payments and blocking financing, unlawfully disrupted business relationships. | No independently tortious act; conduct justified as creditor rights. | Dismissed; no independent tortious interference proven. |
| Promissory and equitable estoppel | FI’s assurances of future financing formed a basis for promissory or equitable estoppel. | No direct communications to Thimjon/Hagemeister; lack of reliance; third-party promissory estoppel not supported. | Dismissed; essential reliance element missing. |
| Unjust enrichment | FI was unjustly enriched by funds diverted from Thimjon/Hagemeister via Northern Grain. | FI was entitled to repayment under the underlying loan; enrichment justified. | Dismissed; no unjust enrichment due to justified enrichment under contract. |
| Deceit (fraud) and amendment to add claims | FI deceived Northern Grain to influence its contracts, harming plaintiffs; amendment should be allowed. | No direct misrepresentation to plaintiffs; no duty; amendment futile and improper. | Dismissed; deceit claims fail; amendment denied as futile. |
Key Cases Cited
- Hilton v. N.D. Educ. Ass’n, 2002 ND 209 (ND 2002) (justification analysis for intentional interference with contract)
- Fankhanel v. M & H Constr. Co., Inc., 1997 ND 20 (ND 1997) (test for justification under Minnesota law adopted for ND cases)
- Van Sickle v. Hallmark & Assocs., Inc., 2008 ND 12 (ND 2008) (elements of intentional interference with contract)
- Ostlund Chem. Co. v. Norwest Bank, 417 N.W.2d 833 (ND 1988) (bank duty to disclose when responding to inquiry; deceit analysis)
- Peterson v. Zerr, 477 N.W.2d 230 (ND 1991) (recognition of interference principles and knowledge-based liability)
- Hayden v. Medcenter One, Inc., 2013 ND 46 (ND 2013) (unjust enrichment and contract-based justification)