*1 power gas. terminate Bohman’s has retained the But DNR “pollution permit from action in the event of or order corrective sewage storage, pump-out asso- facilities, boat fuel service Thus, objections have all environmental facilities.” ciated marina marina proposed in favor of the and resolved considered been planning commis- presented before the of evidence on the basis subsequent DNR board, county as reinforced sion and findings. county board summary, planning commission and
In while requirements procedural their zon- disregarded here have policy development the extent ing perimeter ordinance require Crystal, supra, City reversal Zylka unique intergov- case, situation another we conclude this purposes and balances the substantive checks ernmental development fully perimeter policy are zoning ordinance and decision of the trial court. an affirmance served Affirmed. STORES, INC. INC. v. RED OWL
THEISEN’S 2d 145. 243 N. W. 45626, 46170. 4, 1976 —Nos.
Gray, Plant, Mooty Anderson, & Bolinske, Robert V. Mark A. Nordenberg, and Simonson, James S. appellant.
Karlins, Grossman, Karlins, Siegel Brill, Brill, & Jr., J. E. and R. Grmpner, respondent. James Kelly, MacLaughlin,
Heard before Yetka, JJ., and and con- sidered and decided the court en banc.
Kelly, Justice. Defendant, Inc., appeals deny- Red Owl Stores from an order ing judgment its motion for a new trial and from a of the district refusing against ordering judgment court reform lease one real in defendant for back estate taxes accordance provisions. its We reverse. Market,
Plaintiff, Inc., formerly known as Theisen’s agreement Inc., into lease dated June defendant entered lessor, agreed Theisen’s, build- to construct a wherein operate grocery store. ing in lessee any percent pay Theisen’s 80 provides lease any percent of in- general and 50 real estate taxes increase payable prescribed in a special over those crease assessments describing reads base The lease clause part relevant as follows: against general taxes real estate event the In the
“8. payable currently premises demised term the demised subsequent after calendar general estate real exceed the premises have shall been currently due permises demised taxes yeas' the demised term calendar after first full pay completed, agrees Les- premises have been Lessee then sor, upon receipt appropriate tax statement In the thereof, eighty percent (80%) payment excess. special assess- and installments of assessments event the *3 currently payable against premises due and the ments demised year any subsequent the lease term or calendar the second completed shall exceed the premises have been after the demised special assessments and installments of special assessments currently payable in the due and against premises the demised prem- after the demised year of the lease term full calendar first Lessor, agrees pay completed, to then Lessee have been ises indicating pay- upon appropriate receipt tax statement the (Italics sup- thereof, percent excess.” fifty (50%) of such ment plied.) August by completed undisputed
It the store was making year drafted. the lease Red 1967 the base under as contending however, reformation of seeks “currently payable year in” the inad- words due and were changed year. Thus, vertently “levied in” the base from year parties argues, the base intended both was not 1967 but year taxes were levied the land com- first pleted store. The economic reason for Red contention is Owl’s followed, pay clear —if the as written is Red percent (due of the taxes in excess of the 1966 assessment 1967), payable in land, opposed which was based vacant percent (due to 80 of the taxes excess of the assessment 1968), plus was based on land the com- pleted store. negotiations concerning
Initial began the lease in October Egge, and were conducted between Leonard then Red Owl’s manager, Sr., assistant real Theisen, estate presi- and John then negotiations dent of Theisen’s Inc. pro- Those covered certain posed in the revisions Red Owl standard form lease relevant negotiation instant At case. the conclusion of this initial process, Egge submitted the revisions to Johnson, Richard counsel, Owl’s house prepared and Johnson a draft containing with a following rider real estate tax clause: general “7. In the event the against real estate taxes levied premises any subsequent demised full calen- dar premises of the lease term after the demised have been general shall exceed the real estate taxes levied premises demised in the first full calendar of the lease premises term after the demised completed, have been then agrees Lessor, pay upon Lessee receipt appropriate tax payment statement thereof, eighty percent (80%) * * excess; (Italics of such supplied.) *.” Egge Johnson’s lease draft sent Babcock, to Loren an attorney by Theisen, 12,1965, hired on March for review on be- half proposed of Theisen. Babcock a set drafted revisions which included a “currently from “levied” to payable” reference in the real estate tax *4 proposals clause. These generally meeting were discussed at a among Theisen, Babcock, Egge, and Johnson on March 1965. trial, Egge any At neither nor Johnson could recall discussion changing “currently about pay- Babcock’s “levied” to due and able.” Both Theisen Babcock were dead at the time of trial. letters, and revi- exchanges discussions, of
Following further here, change at issue tax clause sions, refer none of which a added which the clause revision of drafted Babcock special as- percent provision pay 50 would that Red Owl by Babcock. originally proposed sessments, percent as not 80 lease that provision in the final became a This second revision executed was change Egge Babcock’s at and Johnson testified trial
Both by mistake. incorporated in the final in the tax clause he when Babcock’s testified that he had noticed Johnson he made time March 31. At that examined Babcock’s revision “in” marginal copy the draft notations changed payable in” be phrase “currently should through on follow respect apparently did not to.” He to “with Bab- however, executed notations, lease was and the language. cock’s extensive expert with trial, Boblett,
At a real estate Robert case, testi- experience type instant involved tax clauses: concept fied for Owl as to “* * * it And, year, sense out of make have accomplish objective tenant landlord and long full load for the in which the taxes were pull.”
Roy Inc., Brothers, A. Moberg, Thorpe loan officer of financing store, obtained also for the testi- construction of fied that he had calculated the estimated real estate taxes based on the store when he evaluated loan. Theisen, Sr., No tax bills were sent John to Red inOwl 1966,1967, or 1968. The first tax bill sent in June 1969 was hand- appears written him follows:
“6-1-69 “Red Owl to Theisen Inc. payable in 1969 10,365.76
“Taxes payable in 1968 “Taxes 9,112.36
1.253.40 *5 65 1,002.70 80 %— Payable “Taxes for 16 Lot 227.62 1969 Due Theisen, 1,230.32 Inc. “Mr. Dixon your Fridley
“This is a statement for store. “Thanks J. L. Theisen” Other bills were sent in November and Novem- ber All these bills 1968 used com- as of for puting liability Red Owl’s increases, provided tax as not 1967 in the lease. charged Some of bills also Red Owl for the full special assessments, amount of percent provided instead the 50 objection. in the lease. paid Red all There bills without is gave no evidence that Red Owl Theisen counsel on advice or billings. these Theisen,
After the Sr., death John his sons discovered that lease, written, being complied corpora- as was not with. The brought tion then an action allegedly to recover back taxes owed. response, sought reformation and counterclaimed overpaid. for amounts it claimed to have The trial court denied judgment plaintiff reformation and ordered on its claim for taxes. single dispositive issue appeal that is of this as follows: is
Is there clear and evidence of a mutual mistake in the tax clause? holdWe that there is the trial court denying erred in reformation. heavy
There burden on one who seek reformation Fritz, 264, 266, contract. As we said in Fritz v. (1905): N. W.
“* ** equity Before a court of interfere to reform a substantially appear, alleged written instrument it must pleadings, agreement that there in fact a valid sufficient- ly expressing in parties; terms the real intention express there was fact a written contract which failed to mistake, intention; and that this failure was due mutual true inequitable conduct of the and fraud or to mistake one side * * competent evi- established must be These other.* facts contradictory, clear and dence, consistent and not which is preponderance equivocal, convincing Mere and not doubtful. * * * testimony is not relief will extended Such sufficient. *6 negli- laches, (as only own conduct those who have not their position ren- gence, put as to otherwise) in such a or themselves change especially unjust situation, when der it rights might third injuriously innocent affect the or status of (Italics parties.” supplied.) Hubbard, 349, N. 2d 510
See, also, 199 W. v. 293 Minn. Cool (1972); Co. Control Data Co. Metro Office Parks v. Clinic, (1973); Ltd. 278
348, 121 Mankato 205 2d Marso v. N. W. Valley Shopping (1967); 104, 2d 281 Golden Minn. 153 N. W. Center, 2d Super Realty, 256 Minn. 98 N. W. Inc. v. Valu appeal viewed Furthermore, will be on (1959). 55 evidence light prevailing party, and appeal most favorable findings unless overturned the trial court’s factual Procedure; clearly 52.01, Cool v. Rule Rules of Civil erroneous. supra; N. Hubbard, Greene, 251 Minn. 88 W. v. Camenker (1957). 2d 708
Notwithstanding
above,
reason for re-
we find sufficient
Theisen treated
(1)
evidence that John
in
uncontradicted
versal
arose;
year
any dispute
years
3
before
the base
for over
1968 as
expert testimony
(2)
uncontradicted
further
year in
tax clause is the
commercial lease
in this kind of
building.
on the land
which taxes are assessed
attorney were deceased
Theisen and
it is true that
While
persuasive
trial,
evidence of
we think the most
at the time of
1968
conduct. Theisen used
intent
found
his own
Theisen’s
billings
the execution of
in all
Owl after
as the
language
contrary
tax clause. Coun-
despite
of the
explain
as inadvertence
conduct
and the trial court would
this
sel
special
pointing
as-
minor mistakes
carelessness,
to other
billings.
consistency
sessment
We think
and duration
years coupled
conduct over
with the small
some
special
amounts of the
assessment
render these inferences
errors
highly improbable. The
for reformation
re-
standard
does not
quire proof beyond
doubt,
convincing
a reasonable
but clear and
Gartner,
evidence.
Gartner
Minn.
ported by expert testimony concept of Robert Boblett on the recog- of base commercial of this While leases kind. we nize, Boblett, may Mr. differ, as did that individual leases we can see no for a reason tax clause that real estate taxes allocates based increases over land assessments an assessment of the only. provision totally Such a would be a unreliable measure objec- the tax burden as a cost of the lessor and would defeat *7 tive of such clauses —to ensure a reasonable return the to lessor by permitting recovery major portion a of a increase the real improvements. estate tax burden the land and To hold otherwise, think, uphold absurdity. we a commercial
The two items of uncontradicted evidence discussed we have convincing are clear and that evidence of intent the Theisen’s base 1968—the be first taxes were the land clearly and the store. The similar so intent Red Owl is estab- by testimony lished representatives the of its and their business records it that assumed need be was the trial court and not discussed here. Since there is clear evidence parties, a mutual to mistake the the lease must be reformed indicate 1968 as the base the lease
Reversed remanded directions to reform opinion. consistent with this
Yetka, (dissenting). Justice deceased, attor- Theisen is now as is his
I dissent. The senior negotiating are neither ney with him so who worked great given testify. emphasis be to the fact No should here to billings accepted to Red Owl for Theisen 1968 as customary prior years It to death. would for several sending Owl in the advice and counsel of Red him to follow adequate experienced per- yearly billings. There evidence organization aware that were well sonnel changes attorney in the lease which made had made year, purpose than of deter- 1967 the base rather mining payments to lessee the additional be made based being so, seems me That it to on taxes and assessments. changes duty propose proper re- a to Red Owl had to executed, or, if it parties’ it was intent before flect part simply oversight proper make amend- on the of Red period execution. after its ments to the lease within reasonable years death before It wait after Theisen’s seems me to several require doctrine invoke the raised the issue should us to Red Owl equitable estoppel it. its say, I has sustained also believe Needless states, clearly proof because, majority opinion burden of heavy on one who would seek reformation burden there is (1905). Fritz, N. W. 705 Fritz v. contract. OTTERSTETTER REL. HARLEY EX STATE AND ANOTHER. BRUCE McMANUS 243N. 2dW. 730. 4, 1976 No.