Netteland v. Farm Bureau Life Insurance Co.

De- and Kristerin NETTELAND Robert Corpora-

velopment Co., An Iowa Plaintiffs/Appellees,

tion, LIFE INSURANCE

FARM BUREAU

COMPANY, Bureau Federa- Management and Farm

tion Defendants/Appellants.

Corporation,

No. 92-1291. Appeals of Iowa.

Court of

Oct. negoti- Netteland called off

Bureau contends dispute over point one because of a ations at Netteland, however, apparently re- rates. or fifteen min- negotiations within ten sumed negotiations. utes of the break Netteland, According provided he Farm detailing his a written contract Joseph J. Mow- Bureau with Lagomarcino and Mark S. Russell, Moines, proposed agreement. Hanson, Bjork Des ry of & appellants. for 14,1989, a letter March Netteland sent On Hearn, Moines, appellees. R. Des John Farm Bu- including proposed rates to new in the The letter stated “a reduction reau. OXBERGER, C.J., Heard charges undoubt- percentage of for labor will SACKETT, HAYDEN and JJ. of edly result in a reduction of the caliber J., DONIELSON, part. takes no explana- requested an care.” Farm Bureau alleg- Farm Bureau tion of this statement. HAYDEN, Judge. edly negotiations after Netteland ended the appeal arises from a breach of con- inquiry This in a respond to this satis- refused brought by Robert Netteland and tract claim factory April manner. In 1989 Netteland against Development Company Kristerin going Farm to con- was notified Bureau Company Farm Bureau Life Insurance day-care provider another ser- tract with Bureau). (Farm vices. began plans In Farm Bureau to es: company, Kristerin De- Netteland and his day-care center at its West tablish child brought against Farm Bu- velopment, suit Farm Bureau established Des Moines office. contract, alleging negligence, reau breach of investigate day-care issues. a task force misrepresenta- gross negligence, fraudulent employees consisted of The task force contract, tion, contract, implied quasi conver- officer, Boyer. Farm Bureau and an Thomas sion, good covenant of faith and breach the Boyer chair task force served as the of this dealing, estoppel. fair Netteland president of administrative and was the vice him and an oral contract existed between reported The task force to the services. argued agree- the Farm Bureau. Netteland team, budding project reported in turn who ment had been breached and he was entitled management the insurance team. ren- profits to lost and the value of services management reported team to the insurance proceeded jury trial. The matter to a dered. management corporation. eventually all of Netteland dismissed his day-care The task force contacted several except of contract and claims the breach agencies investigation. April In its misrepresentation fraudulent claims. After May of 1988 Robert Netteland and his com- case, the close of Netteland’s Farm Bureau Development Company, pany, the Kristerin court moved for a directed verdict. The an expressed contacted Farm Bureau and misrep- directed a verdict on the fraudulent day-care facility. operating interest the Farm Bureau. resentation claim favor of Eventually, management corporation the 27, 1992, jury returned a On March approved the task force’s recommendation in favor of Netteland and awarded verdict negotiations into Farm Bureau enter $125,- profits damages in amount of lost Boyer August contacted Netteland. judgment 000. The district court filed a informing him Netteland of the decision. entry March on March 1992. Ón subsequent negotiations The extent of the granted the court a motion to extend parties is between the two contested. posttrial filing for the mo- deadline Thereafter, sought a point negotiations tions.

At some between stay granted the began Apparently, of execution. The court parties to break down. days post- on until three after its fighting issue was the rates to be day-care facility. Farm trial motions. charged 17, 1992, mo- April recommending On Farm Bureau filed “Farm Bureau contract for notwithstanding judgment operation the ver- tions of Child Care Center with July (Em- dict and new trial. On organization.” the Robert Netteland added.) court denied both motions. phasis Boyer manage- testified the August filed a notice of on 1992. corporation approved ment the recommenda- cross-appeals. August tions in on the memo contends, appeal Farm Bureau inter In the fall of On 1988 Netteland contacted alia, Boyer specifically parties there was insufficient evidence to submit ask had a regard day-care to the the issue of the existence of a deal with facility. Boyer contract and lost Netteland testified told him the man- agement corporation approved had him. questions I. Contract. The Netteland, Boyer When asked what he told an oral contract whether existed and whether testified: ordinarily it was are breached the trier of say approved. A: I didn’t he was Prods., Inc., Mapco fact. Dallenbach v. Gas Q: you say? What did A: I I believe (Iowa 1990) (citations 459 486 N.W.2d something said to the effect that “You’ve omitted). Farm Bureau contends there was day-care been selected to run the center. justify submitting insufficient evidence to to working architect], You’ll be with [the jury the issue of whether a contract something like that. parties. existed between the Our review is testified, stating as a result of for the correction of errors of law. Boyer’s placed yellow confirmation he Only certainty a reasonable an oral pages regarding facility, ad hired addi- Fortgang contract existed need shown. be employees, tional design assisted Bros., Cowles, 249 85 Iowa facility. and construction of the Farm Bu- (1957). words, N.W.2d 919 In other reau admitted it knew Netteland was adver- sufficiently terms must be definite deter tising the Farm Bureau child-care center. certainty mine with the duties and obli sought Farm Bureau admitted it Netteland’s gations party. Hawkeye of each Burke v. regard assistance with to the construction Co., Nat’l 474 Ins. N.W.2d 113 Life design building. of the (Iowa 1991) (citing Severson Elberon Ele agreement Terms of an are sufficient vator, (Iowa 1977)). Inc., 420 N.W.2d ly definite if the court can determine with All minor details of the contract not need certainty duty reasonable of each proven in pres the first instance in order to performance. and the conditions relative to ent the Fortgang issue the trier of fact. Burke, Severson, (citing 474 N.W.2d at 113 Bros., Inc., 249 Iowa at at 919. N.W.2d 420). August 250 N.W.2d at Prior to Boyer Thomas testified an oral contract Farm Bureau had the current rates or com parties: existed between the petitive day-care rates of over a local dozen So, Q: words, Boyer, in other Mr. providers. point Boyer At one told Nette- you’ve your deposition admitted to me percent land Farm Bureau wanted a ten you agreement, that had an an oral con- competitive Boyer discount on rates. admit Netteland, you, by tract with Mr. didn’t agreed ted at trial Netteland had to lower his deposition, By depo- that at least? A: this percent year. rates ten for the first was, I sition indicated that it correct. parties negotia involved in these Q: Okay. now we’ve established So skilled, experienced businessper tions were you agreement that an had oral with Mr. fully implications sons understood the Netteland, ques- haven’t A: we? Is that a they agreed upon. what We believe the tion? sufficiently complete given terms were when Q: this, According You bet it is. A: interpretations ordinary those reasonable my answer was correct. businesspersons willing give are consider Boyer July ing surrounding addition had submitted in circumstances. See Sev omitted). erson, (citation management corporation 1988 memo to the at 421 N.W.2d language properly court determined the rector to Farm Bureau. The The district agreement specifically required terms of the contract were established with provide necessary to certainty. Netteland to staff con- reasonable The court did not err operation day-care duct the child center. submitting the issue of whether It also restricted Netteland’s selection of a a contract existed and whether it had been director for the center. A director could not affirm on this issue. breached. We prior be selected over Farm Bureau’s written II. Statute Frauds. Farm Bu objection. Boyer specifically testified to this reau contends Netteland was barred from provision regarding a director. introducing supporting evidence an oral con Q: Okay. And so now we have [Nette- applied. tract because the statute of frauds architect, working gearing with the land] upon Farm Bureau bases its claim staff, up advertising Oh, parts one of the — 622.32(4) (1991), contending section Code your whatever with Mr. Netteland was five-year being negotiated contract was for a director, you approve had a period. provides, Iowa Code section 622.32 you? approve. didn’t A: Not hadWe pertinent part: guess you say requested asked —I would Except specially provid- when otherwise opportunity that Farm Bureau have the ed, following no evidence of the enumerat- with, any subsequent chat interview with competent, ed contracts is unless it be in director, person and we did not feel that writing signed by party charged and was, opinion, in our who we would to like by party’s agent: authorized have, then could we exercise the to (4) performed that Those are not to be reject. year. within one Q: right. Okay. All part But that was 622.32(4)(1991). § Iowa Code The statute of your was, arrangement, of it whatever evidence, frauds is a rule of not of substan- Netteland; Mr. correct? A: That’s cor- law, proof tive and relates to the manner of rect. not but does render oral contracts invalid. And, fact, Q: you did interview a Ward, 746, Johnson v. 265 N.W.2d 747-48 director, person up he lined to be didn’t (Iowa 1978); Stauter v. Walnut Grove you? Following Judy leaving, A: Miller’s 1971) Prods., (Iowa 188 N.W.2d 313 yes, we did. (citations omitted). plaintiffs may holdWe Q: you Cyndee Kusy, And met with impact avoid the of the of and statute frauds you and interviewed her to determine properly introduce evidence of the oral con- you whether wanted her to be the director Gardner, tract. See Gardner v. 454 N.W.2d there, you? out didn’t A: We talked with (Iowa 1990). 361, 363 her, her, you interviewed whatever term frauds, Under our statute it is well use, yes, would like to we did. partially per- established that a who We determine these acts were done agreement may forms under the avoid the agreement. Netteland accordance with the impact of the statute of frauds and intro- partial performance This constituted duce evidence the oral contract. Therefore, parties. the statute of frauds is (citations omitted). Id. Our courts have rec- applicable partial perfor- not because the conduct, acts, ognized any or circumstances impact mance was sufficient to avoid the “part performance” offered to show in order the statute of frauds allow the admission bring exception to a case within Gardner, parol evidence. See 454 N.W.2d statute of frauds must be 361; referable exclusive- 411; Knight, 292 N.W.2d In re Lind- ly unequivocably to the contract. In re Estate, sey’s 118 N.W.2d 598. We determine Estate, Lindsey’s 254 Iowa 118 properly parol the district court admitted (1962) (citations omitted); N.W.2d 605 exception evidence under the to the statute Anderson, Knight see also v. 292 N.W.2d of frauds. We affirm on this issue. 411, 417 objected III. Lost Farm Bureau Profits. In employees this case Netteland hired of an instruction on lost submission staff the facility presented profits ground new a di- on the the amount of the

167 speculative, The court overruled We determine the evidence in the record profits objection. was sufficient to submit the issue profits of lost as the result of the argues On breach of contract. conclude We the district present any evidence which could failed court did not err. We affirm on this issue. determining lost form the basis is for the correction of errors of Our review IV. Motion Continuance. R.App.P. 4. law. Farm Bureau contends the district court in overruling abused its discretion its motion profits, In order to recover for lost for continuance. Our standard of review on damages may overly speculative. not be this issue is abuse of discretion. Bell v. Iowa City Hullinger, v. Kansas Ins. Co. 459 Life (Iowa Court, App. Dist. 494 N.W.2d (Iowa App.1990) (citing N.W.2d 1992). (Iowa Knosby, v. Jamison 423 N.W.2d they unfairly Farm Bureau contends were 1988)). certainty The reasonable of the lost prejudiced by discovery Netteland’s abuses profits Township must be shown. Brown grant and the district court’s failure to them Kress, Mut. Ins. v. Ass’n a continuance as the result of these abuses. (Iowa 1983) (citations omitted). 299-300 discovery Farm Bureau contends the abuses Shinrone, Tosco, Inc., the Iowa comply pretrial included a failure with a Supreme approved following Court state- scheduling order and resulted in their inabili- ment: ty adequately prepare for trial. profits sought When the which are are Trial courts have broad discre contract, arising those out of the breached tion on motions for continuance. profits presumed those ... are to have Co., Rattenborg Montgomery Elevator contemplation defaulting been (Iowa (citations App.1989) N.W.2d party at the time he entered into the con- omitted). We will not interfere absent a tract, proved and are recoverable showing Marriage clear of abuse. re certainty. reasonable (Iowa 914, Hatzievgenakis, 434 N.W.2d 916 Shinrone, Tasco, Inc., 283 N.W.2d (citations omitted). App.1988) A district (Iowa 1979); 286 see 22 Dam- Am.Jur.2d ruling court’s on a motion for a continuance (1988). ages § 630 correct, presumptively is a chal only pres lenging ruling heavy It is essential a Netteland has burden to might reasonably presumption. Rattenborg, ent such evidence as be overcome the 438 expected to be available under the circum N.W.2d at 605. Farm Bureau must also Page County justice Appliance nearly stances. See Ctr. v. show substantial will more (Iowa 1984) Bell, Honeywell, by granting 347 N.W.2d 178 obtained a continuance. (Second) (citing Miller, (citing § Restatement of Torts 912 494 N.W.2d at 731 State v. 480 (1979)). (Iowa 1992)). cmt. d The record reveals factual N.W.2d deter We profits for which to basis calculate lost with mine Bureau has not shown the dis certainty. explained reasonable Netteland trict court denying abused its discretion in upon the source of the facts which he relied the motion. affirm on We this issue. calculating profits. in his lost Netteland’s V. Motion New Trial. Farm Bureau projections profitability were based on contends in the district court erred overrul- providers rates of other which had been com ing motion its for a new trial. Defendants force, piled Farm Bureau’s task costs of argue totality of the circumstances com- food, supplies, employees’ salaries which effectively deny bined to them a fair trial. experience Netteland calculated based on his explained in the business. Netteland also The trial court has broad discre how grant deny he determined lost Netteland tion to a new trial motion. Co., gross testified how he calculated revenues Kiner v. Reliance Ins. 463 N.W.2d (Iowa 14(f)(3). 1990); expenses and then subtracted R.App.P. reach his willWe profits figures. ruling not set aside the district court’s in the showing refusing interrog- of abuse of discre-

absence of clear discretion to submit the Kiner, at 13. affirm on tion. 463 N.W.2d atories. We this issue. cross-appeal Netteland raises two is- On the district court did not We determine (1) right sues: Farm Bureau waived its denying abuse its discretion in Farm Bu- staying execution in the district reau’s motion for a new trial. We affirm on (2) court, and district court erred this issue. directing plaintiffs a verdict on fraud claim. VI. Cross-Examination. limiting court erred in maintains district VIII. Waiver. Netteland contends plaintiff its cross-examination of appeal by defendants waived their history filing regarding his lawsuits and stay obtaining a of execution. Netteland experience gained he as a witness. The support cites Iowa Code section 626.60 in plaintiffs objection district court sustained argument. provides: his The section “No relevancy. based on stay appeal shall be allowed after a of execu tion has been obtained.” Iowa Code scope of cross-examination is (1991). § 626.60 within the trial court’s discretion. We re proceedings surrounding set forth the We verse for an abuse of discretion and then stay of execution. On March only appears prejudice Avery if it resulted. judgment entry the district court filed a Co., Implement v. Harms 270 N.W.2d jury’s day verdict. The next Farm Bu- (Iowa 1978); McEnerney, see Lund v. reau filed a motion to extend time to file posttrial motions. The district court extend- The district court ruled Netteland’s filing April ed the deadline to 1992. On litigation involvement in other unrelated 6,1992, April Farm Bureau filed a motion for testimony his was not relevant to the issues pursuant of execution to Iowa Rule of involved this case. determine the We Civil Procedure The district court court did not abuse its discretion district granted stay, stating proceed- all further objection sustaining plaintiffs based on rele ings “stayed period were to be for a of three vancy. affirm on this issue. We days beyond filing of this Court’s upon post defendants’ trial motions.” Farm Interrogatories. VII. Farm Bu judgment Bureau later filed motions for not- argues reau the district court abused its dis withstanding the verdict and new trial. The failing special cretion in to submit four inter post- court filed its on Farm Bureau’s rogatories jury. to for an We review July denying trial motions on both R.App.P. abuse discretion. Iowa appealed. motions. Farm Bureau later jury requested given Dorr, In Brenton Brothers v. the Iowa special interrogatories concerning four Supreme recognized types Court three existed, they whether a believed contract stays of execution: breached, whether the contract had been [F]irst, by which those are ordered prof- whether Netteland was entitled to lost rendered, judgment court in which the its, and the extent of the lost Farm any appellate pro- but not as the result of interrogatories these were ceedings, proceed upon and which necessary jury to ensure the understood the that, cause, ground for some the execution limited it issues with which was confronted. judgment ought postponed to be to interrogato- The court refused to submit the date, or, subsequent perhaps, ought some ries. all; second, place not to take at those interrogatories of, attend, consequence The submission of which are a or third, appellate proceedings; is within the trial discretion court. those (Iowa Freshour, Six v. 231 N.W.2d which from [Iowa result statutes Code sec- 1975). interrogatories granting The court stated the tion 626.58] the defendant a fur- jury. would helpful satisfy judgment not be We deter ther time in which to upon giving security mine the district court did not abuse its his certain therefor. general control of its cumstances and facts of this case Farm Bu- Each court has such preven- appeal. not waive its process enables it to act for the reau did as tion of all abuse thereof. IX. Directed Verdict. re Dorr, 725, 728, 239 Brenton Bros. v. 213 Iowa viewing whether the district court was cor omitted). (1931) (citations 808, 809-10 N.W. directing in rect verdict on Netteland’s stay. fraud claim we must determine whether sub involves the first class of

This case stay supports every “arises out of and reason of the stantial evidence element of McGraw, supervisory power of the court over its own the claim. Swanson v. 447 N.W.2d (Iowa 1989). it is process, and is available whenever neces- Evidence is considered sary justice.” light in accomplish the ends of Id. most favorable to the stay against at 239 N.W. 810. This “is whom the motion is directed. Id. court, always a discretional matter with the Evidence is substantial if a could rea sonably every and will not be reversed this court unless infer from it the existence of capriciously power to issue the same is element of the claim. Id. If the evidence is omitted). (citations substantial, appro exercised or abused.” Id. not a directed is verdict provides priate. Iowa Rule of Civil Procedure 246 Id. The trial court is vested with guidance stay. determining further on the The rule considerable discretion is states: whether evidence sufficient to submit an Ventures, jury. issue to the Business [judgment If motions under R.C.P. 243 City, notwithstanding or verdict] [new trial] [judgment petition or under R.C.P. 252 The district court directed a verdict be- filed, timely modified] vacated or are cause was not there substantial evidence may, in court its discretion and on such support misrepresentation the fraudulent terms, any, proper it order a as deems agree claim. We and affirm. stay any proceedings, or all further appeal Costs of this are assessed one-third process judg- executions or enforce the appellees appellants. and two-thirds to ment, pending disposition of such motion AFFIRMED. petition. post- Iowa R.Civ.P. 246. Bureau filed OXBERGER, C.J., concurs. April trial motions on 1992. The district granted stay court later of execution which SACKETT, J., part concurs in and dis- days was to last until three after it ruled on part. sents in

the motions. The court ruled on the motions July on 1992. The of execution SACKETT, (concurring part Judge 7,1992, days August expired three later. On dissenting part). appeal. Farm Bureau filed a notice of part part. I concur in dissent Farm Bureau did not seek an while damages for defen- Plaintiffs recovered in was existence. Rule Civil alleged dants’ breach of an contract stay in Procedure 246 allows for a order that plaintiffs supply child care services may posttrial the court such motions. address ap- employees. defendants’ Defendants have properly district court followed rule 246 The cross-appealed. I pealed plaintiffs have Dorr, 246; and case law. See Iowa R.Civ.P. appeal would reverse on defendants’ and af- 728-29, at 213 Iowa at 239 N.W. 809-10. plaintiffs’ cross-appeal. firm I would dis- on acquire advantage did not miss the ease. significant delay proceedings a in stay. on no Plaintiffs’ claim is based on an oral con- based We have found case primary is interpreted applied which our have tract. The issue this courts prohibit evidence to Iowa Code section 626.60 so to an whether there was substantial stayed support finding plaintiffs a and defendants appeal after a trial court has an exe- binding five-year oral purpose disposing post- cution for the had entered into a agree majority trial under the cir- contract. I cannot with the motions. We determine sup- that there was substantial evidence

port finding. such of statute

Defendants have raised issue frauds, contending precludes the statute five-year oral contract.

the enforcement of ultimately parties clearly intended to be plaintiffs’

bound a written document. The precludes

contention the statute of fraud en

forcement has merit. See Marti v. Ludek

ing, 193 Iowa 185 N.W.

(1921). passed

A number of drafts of a contract parties. These contracts ad-

between the rates, termination, parties to the

dressed

contract, director, approval of the mainte- premises, and the effect of

nance

regulatory standards. agreement contingent an

While there was clearly reaching agreement,

on an there meeting agree- An

never a of the minds.

ment to contract the future is not a con- Rapids,

tract. See Air Host Cedar Comm’n, Rapids Airport

Cedar

450, 453 significantly, I find no evidence of a

Most

meeting price of the minds of the that would care, charged for child one obviously significant aspects

the most of the contract. agreed price.

I I find no evidence of an also agreement

find no as to a defined formula for charges.

increases JAMES, Appellant,

Jesse W. CORPORATION,

SHELLER-GLOBE

Appellee.

No. 93-295. Appeals

Court of of Iowa.

Oct.

Case Details

Case Name: Netteland v. Farm Bureau Life Insurance Co.

Court Name: Court of Appeals of Iowa

Date Published: Oct 28, 1993

Citation: 510 N.W.2d 162

Docket Number: 92-1291

Court Abbreviation: Iowa Ct. App.