please the court my name steve davidson i'm here on behalf of first dakota national bank i want to begin with a little bit of context about collateral assignments this was a forty two and a half million dollar commercial loan to an ethanol plant in north central nebraska when lenders make those those kinds of loans taking a security interest just in the hard assets themselves the equipment plant cetera doesn't provide the necessary protection to the lenders when there's a business like this whose ongoing value as an enterprise is dependent upon a contract that's in place  with a third party in this distance you can't run an ethanol plant less you have rail tank cars to take the ethanol out to where it's being sold and without that the value of the plant itself to the lenders as collateral is not the same that's why these contracts are so critical another example may be you know a loan to a manufacturing facility that has a building full of least equipment the lender is going to not only take an interest in that building but is going t an assignment of that lease because if there's a default selling that building with the equipment in it is worth a lot more to the lenders than selling the building standing alone so that's why these contracts are so critical and in that function the fact that they always contain this notice obligation on the counter party to the contract to the outside third party to give the lender notice that there's been a default by the  borrower and an opportunity to cure that default that's the most important term in the contract because that's what protects the lenders ability to keep that important contract in place to preserve the ongoing value of its collateral that's the context in which this breach occurred by eco energy the second bit of background that i think is really critical to your evaluation of these facts is the fact that that the lender here is not a country it's a participated loan of nine lenders including several foreign credit entities and which which often happens when you've got a you know forty million dollar loan you know first decode a national bank can't loan that much money so you participate the loan out which means the the interest is spread amongst that lending group and this is very a very unusual circumstance because usually the lead lender in a situation like this has the biggest piece of the loan by the time these events occurred the lead lender here at country had divested itself of most of its interest and held only fourteen per cent first to kota national bank was the majority lender was there provision was how first to code it could have become the lead participating you know i don't know i think i'm sure that the credit agreement is about hundred fifty pages i bet it's in there somewhere go ahead it is too but i can usually assign votes and all kinds of things going right right what we know is in this case a country remain the leader but first the coda had eight million dollars in this in this credit facility and and first dakota was dependent it's its interest in that loan was dependent upon ag countries representation of its interest as a lead lender and so ed countries job was to protect the interests of that group in a context where when a decision is made about ok we've got this notice about this these rail cars potentially being a default this is an important part of our collateral base should we advance another hundred thirty thousand dollars on a forty two million dollar loan to protect this asset that was not a country's decision to make that was the decision decision to be made by the majority then you look at what we start with which is an admission by eco energy that yes this collateral sign was in place yes it contained an obligation on us to tell you lender if there was a default and give you a reasonable opportunity to cure and the evidence is undisputed we forgot about we lost the document we didn't know we were supposed to give you that notice and so we breached we acknowledge that we breached the only question left for judge garage to decide and which is on appeal to you is how does causation work in that scenario and it's a really it's an interesting scenario in that the the the whole case the whole trial we did was was as judge gerard asked us to present it a question about events that never occurred to you know the question i think he wanted us to do to you know his that his decision was bank you haven't  satisfied your burden of proof to convince me that ag country would have paid the money to cure that was his finding how do we do that we're talking about an event that never happened and going back to issue is not you know so what you do in those cases is you present the full universe of facts and circumstances here was everything that would have affected that decision but that the legal issue here is what's the standard to be applied to the causation issue is it is it proving subjectively eg country would have cured which is inherently speculative unknown because eco energy by its breach prevented those sequence of events from ever happening so we don't know what they would have been but but what the district court did was looked at the related actions of the parties was there a willingness to extend financial support to this company that is admittedly not doing well even at that time and so there it's not completely speculative craig you're looking at the situation at the time what what are they doing otherwise in relation to this financial there and in that regard what the district court did was was look to countries decision to not advance funds at an earlier point in time and the important thing to remember there is that if you look at this objectively is when those decisions were made there was at the same time an a very active set of communications going on about the possibility of ten aska the big investor and me and the majority owner of the ethanol plant pain that money to cure the default itself and the bank is sitting there watching this happen twice a bank going to say ok here's our hundred thirty thousand dollars when it knows that one of the investors in the ethanol plant is giving active consideration to that money so that at that point in time there's no motivation for the lender to do anything but sit back and watch and the lender knows that my this railcar collateral of mine is not at risk of being lost to me until i get that written notice from eco energy that i'm entitle to under this collateral assignment telling me the world has changed i'm going to take these cars away from you then it shifts to now it's my  decision and and i think what judge your did was he looked at those some of those initial facts we gave him a very rich record about all the other reasons why a reasonable lender would unquestionably pay the small amount of money in this context to preserve this collateral but what he said at the end of the day was i'm not convinced that ad country would have cured and part of that was because they didn't testify what he should have done is said because this is a scenario where a vents were prevented from happening by the breach itself the question he should have asked is what would a reasonable lender have done in all the facts and  maker in the shoes of ag country you have valuate all the surrounding objective facts and circumstances and you say say what would a reasonable lender have done and in this case there's you know as i said there's you've got you've got the dollars of course that you know you've got a market value for these cars that it increased more than four fold in two years you've got a an ethanol plant that is temporarily idle the waiting for the price of corn  got other parties ready and willing to pay the money for you as a lender the lender sitting there and it goes i've got to nasco the the majority owner who's going to fork over one hundred thirty thousand dollars and we know that because ultimately actually did so and if you're ed country you know you know i've got fourteen seventeen percent of this loan i've got first dakota national bank over there who's got double more than double the money in this ob in this debt that  do i know they're going to want to pay this hundred thirty thousand dollars because the economics of this situation makes sense that even given first dakota's twenty eight approximately percent interest in the loan the value of this collateral just to its share more weigh more than justifies the money necessary to keep the to keep the lease in place so had judged looked at that full universe and that he phrased that as a burden of proof issue and he said if you read if you read is the towards the end of the opinion especially when he talks about is you know here's all the evidence that's in front of me i'm not convinced first to kota that you have proven to me that ag country would have egg country itself would have cured it's not the same question as because that's a subjective question about that particular lender it's a broader issue than that  i'm i'm john hicks and i represent eco energy jester ard told us in his summary judgement opinion at pages twelve and thirteen that what we're going to try in front he did not tell us that we were going to try a case about what to ask a would do he did not tell us that we would track case about what first dakota would do he did not tell us that we would try a case about what some hypothetical hypothetical reasonably prudent lender would he told us directly i would suggest to the court that we are going to trial what would agc country have done at its core first decoders appeal is rises and falls here with its attack on will findings are clearly erroneous only if they're not supported by substantial evidence or this court is convinced that the legal analysis was wrong or this court is left with a definite and firm conviction that an error was made case quoted several other cases and said that queer essentially where there are two permissible views of the evidence the fact finders choice between them cannot be clearly erroneous so in response to mr davidson's argument that we should consider what would happen with all of these other parties that's not what judge jury told us to try and that's not the prop that's not the issue at hand the issue at hand is what would ag country have done and one of the factors that judge your order consider to be considered that the right to receive notice the notice that that first a code complains that advised of what was going on with the need to act and its business operations in two thousand and twelve what about the counter point that well maybe they were fully advised but they'd hadn't gotten  formal any formal notice of that default with an opportunity to cure and so we really didn't feel the urgency yet judge kelly what they knew progressively was that eco had called the fall they knew this because mr faber when the president told them they knew that eco energy was taking possession of the rail cars they knew that because mr fatal and told them that and there's no evidence in the record to say that to show that they would have done anything else had they received a piece of paper that said here's your notice of what you already know they had actual notice and day in and first a code is submitted no proof that they would have done anything any different than what was what was actually done and the things that judge gerard considered and in drawing his conclusion were the testimony of mr favor one and mr favor lin's view that ag country had had had enough they understood what was going on with need that they understood the status of the financial condition of need that and they did have actual knowledge of what was happening to these royal cars there was also testimony from mr fay girl in this critical that on behalf of need act he went to ag country in asked for the money to cure the default in the eco dispute in the record and there's no real basis to conclude that ag country would have done anything any different than it did first the code argues that we should look at this from the standpoint of what a reasonable winner would do but that's not what the standard should be what the standard should be is what did the research what did this lender  what did the facts that were a deuce did trial indicate that this cylinder would do and the facts that were reduced to trout indicated that this lender had had enough that this lender was not  had no intention of pure in this default in fact there was testimony at trial that this lender knew of the importance of future operations of the rail cars that were at issue in the lease state though so you know we address his argument a state could adopt an objective standard they could make it real clear that it's an objective standard you know what his argument is and so if north dakota done that he would have a strong point please address his main argument about the north dakota law being objective objective standard well may it please the court the north dakota statute we would submit doesn't say what the first dakota national bank says that it has what it says is that this is an issue on the measure of ordinary course of thanks it the ordinary course of things well the the cases that we found that we referred to the late how case indicate that what that addresses is that heavily versus baxendale consequential damages issue and not what would some reasonably prudent linder do what would the effect to be if a reasonably prudent lender acted what we have here in considering the objective facts are the facts that judge gerard considered when he concluded that ag country had no intention of or that actually  circumstances the surrounding circumstances were those that discussed earlier the fact that the the plant had shut down the fact that country knew that the that at country knew that the the relvar lease was in default that ad country was asked to find the defaulted lease payments is there any other north dakota law statutory or case law that helps address this particular issue your honor none that we found that we were able to cite in our brief if there is we did not find it but we believe that what what happened here is that judge gerard considered the objective manifestations of what the intent of ag country was in this particular instance and concluded that  x country would not appear that ag country had had enough of this and that ag country sought to reduce its exposure and not advance additional fines so what so really what the district court is saying is  f having made that finding of fact that you just stated that it would not of cured then it wasn't damaged wasn't damaged by a lack of notice that the ad is the damage it's a day image question that the absence of receiving a piece of paper confirming what ag country already knew was not the proximate cause of any damage to any country because again ag country knew an egge country made its decision not to step forward in cure and not to advance additional fines and the less the court has further questions for me i'll yield to my coll it's fact finding on the wrong question is what happened because the question is is driven by north dakota law and proximate cause and we get this it's an unusual circumstance so there isn't a case but what we do see in north dakota law is that is that when you're talking about contractually significant events it's not just a piece of paper it's a contractually significant event and there is no court of law talking about mutual assent to a contract be evaluated in objective terms of versus subjective there's north dakota law that i've given you in the brief talking about conditions in a contract that require knowledge of a party you don't have the party come and say i knew therefore the condition satisfied you look at all the surrounding facts and circumstances and you determine what up a reasonable person in the shoes of that party know went off so that the condition is a lie ho the closest case  yeah it's mowen and and then they'll send construction or the to that number ok so and then you look at the statute you look at the common law definition of proximate cause in north dakota the talks about damages not flowing from the bre close case i think so but as i said there are contract aces in north dakota that apply this objective test and all this proximate cause issue the point of all this law i gave you from north dakota is that proximate cause is always viewed objective and that's what should happen here well if the if this objective if this reasonable linder that you that you describe  must must have all of the characteristics of the actual linder in the case and be in and be faced with all of the circumstances then what's the difference what's the difference between a subjective and objective in in this kind of case the difference happens because in this circumstances the a vet that caused activity never happened what we're trying to evaluate is well what would have occurred had this very important contractual notice been sent to the lender that changes the universe of circumstance and everything that happened before that really you know you can i suppose draw inferences from  they're relevant but what what you're looking at to decide here is is a decision that you never got got to be made facts that never got to be created because a contract was breached and the notice was never given and forty three ninety one first go to national versus echo energy alosi has submitted for decision and the co