*1 RURAL BANK OF AMERICAN
GREENWALD, Respondent, v. Hein, Maclay Hyde, Laura J. R. Gray, HERICKHOFF, Appellant, Ben Plant, Mooty Bennett, P.A., Mooty, Min- neapolis, Herickhoff, al., Anna et Defendants. Miller, Cousineau, Michael D. McGuire & HERICKHOFF, Ben defendant and Anderson, Chartered, Minneapolis, for Ben party plaintiff, Appellant, third Roth, Lundquist, Scott B. Lundquist & Minneapolis, for Mark Herickhoff. HERICKHOFF, Mark third defendant, Appellant. FORSBERG, Considered and decided CX-90-2341. and FOLEY and Appeals of Minnesota. OPINION 1991. CRIPPEN, Judge. Sept. 25, Review Granted granted judgment
The trial court for re- spondent Rural American Bank Green- following special jury wald verdict favor- ing appellant Ben Herickhoff. The trial court concluded that Minn.Stat. requiring the statute writing, ments be in barred a contract defense based on breach of an apply pro- first from operations appellant ceeds Ben applying Herickhoff’s loan before them to the Donna Herickoff.
FACTS Appellant Ben Herickhoff is a retired daughter-in-law, ap- farmer. His son and pellants Herickhoff, oper- Mark family ate Herickhoff farm once farmed Ben. 1980s,
Throughout the Mark and Donna farming op- received loans to finance their Greenwald, eration from State Bank of predecessor Rural Ameri- can Bank of State Greenwald. Mark and Donna more than needed $175,000 To bank’s limit. limit, Mark and Donna to exceed $175,000 agreed to borrow from bank farming opera- to be used to finance the Bank officials told Ben that the farming operation *2 362 ANALYSIS and his his loan after pay off
used to proceeds the off would paid loan was 2 Section states: and loan. off Mark’s Donna’s pay used to A on a in a was contained also assurance agreement the is credit vice-president by bank typed document consideration, writing, expresses in typed This document was Doug Winter. terms and forth the relevant by signed and was on bank letterhead by the signed farming oper- the 1987, proceeds 1(1) agree- describes credit pay completely to off used ation were ment as: Meanwhile, loan. Donna’s and Mark’s repayment to lend or forbear $175,000. remained at Ben’s loan balance action, in goods, or to money, repayment. Ben for sued Respondent otherwise of contract and fraud. Ben claimed breach financial accomodation. verdict, finding special jury The returned The that the trial court found agree- the loan respondent that breached pay agree- to Ben’s loan was appellants’ Responding ment. to alterna- ment afoul of section 513.33 be- that ran claim, jury found that tive the by properly cause was not confirmed fraudulently did induce Ben to enter executed document. We conclude jury After the into the loan contrary apply to the that an to granted “summary verdict, trial court the loan to one before another respondent, finding that the judgment” for not an under was enforceable money nor an to extend 2 which Minn.Stat. § credit. requires in writ- to be pay The Ben’s loan first ing.1 type also was not the “financial accomo- by dation” the In con- envisioned statute. ISSUE statute, struing “[gjeneral are the words (1988) meaning in ap- construed to be restricted their bar Does by pellants’ preceding particular of contract defense? words.” Minn. Wendt, judgment response case. O'Brien court was in come the law of the The trial (Minn.1980). respondent’s verdict” immedi- “directed motion ately began, premised ruling post-trial trial on Minn.Stat. The had two con- before trial court’s trial, First, sequences. mistakenly weeks before § 513.33. Two the court eliminat- complaint possibly promissory estoppel under was amended assert ed a defense. valid pretrial Sons, Mitchell, this motion taken un- Hayes statute. The was See Del 275, 284-85, Inc. v. 304 Minn. (1975) der the trial court as (prom- advisement and decided "summary judgment" jury after issory estoppel may be used to remove an oral judgment Second, frauds). the trial court’s were motion and from the statute of contract law, premised need not on matters jury that because the found breach- explore they properly were contract, whether considered validity ed the of the fraud verdict summary judgment under a directed verdict was thrown into Because breach claims, motion. fraud were contract and alternative contract, jury once found breach their trial, during the We that course of observe inducement decision on fraudulent became ir- claimed the also Thus, conclude, respon- cannot relevant. we Ben's should be enforced under the loan first contends, already dent that the fraud issue has estoppel. promissory doctrine of Because the Likewise, appellants. against been determined jury trial asked the assume the court process employed by contract, the trial court consti- ment valid court did not was a rejecting respon- tutes several bases for one of jury estoppel consider the issue. estoppel verdict, argument dent's that an claim is barred jury After the trial court concluded jury’s verdict that contract was the contract unenforceable fraudulently Because we reinstate the induced. The trial 513.33. court erred verdict, ex- we need not further ruling contract that the contract was unenforceable after allega- promissory estoppel plore asking jury the fraud or to assume that the contract was instructions, to, Jury objected tions. if not be- valid. Here, 645.08(3)(1988). unless the Stat. acco- general phrase “any writing.” fitting for a preceding
modation” restricted debtor’s claim to enforce extension of cred- particular phrases “agreement to lend or brought it. the creditor has ac- money” “agree- repayment of forbear tion, and the debtor asserts his ** * ment extend credit.” support a claim creditor erred in *3 application phrase expand not of does handling repayment of a loan. favoring agreements statute all Because we hold that section 513.33 does Rather, “any phrase debtor. financial here, not apply we need not decide whether interpreted to mean accomodation” must be respondent’s letterhead was sufficient in the financial accomodation nature satisfy signing requirement statute’s lending or or some forbearance nor whether required could be agreement for other extension of credit. comply with an it did not was not a sign. We also not need decide whether agreement, agreement, or a forbearance an signature Herickoff’s on written Estes, extension credit. See Carlson v. agreement was fully needed to comply with (al- (Minn.App.1990) the statute. though mortgage an underlying is a credit within the definition 513.33, 1(1), prom- of section DECISION mortgage,
ise record because post-verdict We reverse the trial court’s any not an extension of credit nor other judgment in favor of and order accomodation, a credit reinstatement of the agreement).2 Reversed. interpretation sup- This of the statute is ported by legislative legis- its history. The FORSBERG, Judge (dissenting): regulate lation intended to those agreements extending promising credit or I respectfully majority dissent. The repayment or forbearance. S.F. When position takes eventually the bill that sec- became appellant’s the Bank to loan ahead 513.33, tion on was introduced the Senate of his son’s loan not a floor, author, Randolph its Senator Peter- within the Minn.Stat. son, prevent described it as an effort (a position argued by appellant). not even using ongoing lending borrowers an 1(1) (1988) de- relationship with lender enforce un- fines agreements for future loans. Com- Peterson, ments of Sen. Senate Committee money, goods, in ac- Whole, 6,May (tape). tion, purpose is by applying not served section other financial accommodation. agreements, here, 513.33 to like the one provides: The statute further obligations that address the may A debtor not maintain an action on a parties completed under a loan transac- writing, expresses consideration, fur- construction the statute is forth the relevant terms and compelled ther its on reme- signed the applies only dies. The statute to actions brought by the debtor to enforce a loan (1988). 2 states It subd. 2 “[a] question on seem that the Carlson, question Carlson, at was raised whether 127. Neither here, mortgage, record the al- parol raised issue de- evidence agreement, though might not a credit be barred cline to address this parol as evidence evidence rule. “financial accom- to make a attempt anis
modation." Cynthia Lynn Marriage of
In re the (now Carrizales), HAYES Appellant,
petitioner, *4 HAYES, Respondent.
Jeffrey S. CO-91-236. Appeals of Minnesota. Foley, Atty., Ramsey County Brad
Tom Johnson, Atty., Ramsey County A. Asst. Paul, appellant. for St. Paul, Guzik, P. St.
John decided Considered DAVIES, and NORTON and