813 N.W.2d 49
Minn.2012Background
- UPB sought to recover attorney fees under loan documents securing the Haugens and HNE obligations.
- District court denied a jury trial on UPB's attorney-fees claim and awarded UPB over $400,000.
- Court of Appeals affirmed, holding the fee claim was equitable and not subject to a jury trial under the Minnesota Constitution.
- This case asks whether Minnesota’s Constitution guarantees a jury trial for a contract-based attorney-fees claim.
- UPB's claim for fees arises from contractual indemnity provisions in promissory notes, security agreements, mortgage, and guarantees.
- The Supreme Court of Minnesota held that such fee requests are legal claims with a jury right and remanded for new proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Minnesota Constitution guarantees a jury trial for a contract-based attorney-fees claim | Haugen asserts UPB's fee claim is legal and trial by jury is required. | Haugen contends the fee claim is equitable and not subject to a jury trial. | Yes; UPB's fee claim is legal and jury trial is required. |
| Whether a contractual indemnity claim for attorney fees is a legal action | UPB's indemnity claim is a money obligation under the contract and is legal in nature. | The claim is akin to restitution or equity and not a legal action. | Legal action; entitled to jury trial. |
| Whether the remedy sought (attorney fees) is inherently equitable or recoverable as money damages | Attorneys' fees under contract are recoverable as damages for breach. | Attorney-fee recovery is equitable and non-juryworthy. | Remedy is money damages under contract, thus legal and jury-triable. |
Key Cases Cited
- New Amsterdam Casualty Co. v. Lundquist, 293 Minn. 274, 198 N.W.2d 543 (Minn. 1972) (indemnity actions recoverable as money; jury trial proper)
- Raymond Farmers Elevator Co. v. American Surety Co. of New York, 207 Minn. 117, 290 N.W. 231 (Minn. 1940) (surety contract actions involve money damages and jury trial)
- Olson v. Synergistic Techs. Bus. Sys., Inc., 628 N.W.2d 142 (Minn. 2001) (right to jury trial depends on nature of controversy and relief sought)
- Abraham v. County of Hennepin, 639 N.W.2d 342 (Minn. 2002) (two-step inquiry: nature of controversy and relief sought)
- Landgraf v. Ellsworth, 267 Minn. 323, 126 N.W.2d 766 (Minn. 1964) (suit on contract for the recovery of money is a legal action triable to a jury)
- Dairy Queen, Inc. v. Wood, 369 U.S. 469, 82 S. Ct. 894 (U.S. 1962) (action on a debt under a contract is a legal, jury-triable action)
- Griswold v. Taylor, 8 Minn. 342 (Minn. 1863) (attorney-fees provisions in mortgage treated as contractual obligations)
- Campbell v. Worman, 58 Minn. 561, 60 N.W. 668 (Minn. 1894) (recovery of attorney fees under contract considered equity-like in some contexts)
- Schwickert, Inc. v. Winnebago Seniors, Ltd., 680 N.W.2d 79 (Minn. 2004) (costs and disbursements concept; distinguish contractual fees from costs)