Filed 3/19/20 by Clerk of Supreme Court

IN THE SUPREME COURT

STATE OF NORTH DAKOTA

2020 ND 67

Lakeview Excavating, Inc., Plaintiff and Appellant

v.

Dickey County and German Township, Defendants and Appellees

No. 20190195

Appeal from the District Court of Dickey County, Southeast Judicial District, 

the Honorable Daniel D. Narum, Judge.

AFFIRMED.

Opinion of the Court by Tufte, Justice.

James M. Cailao (argued), Moorhead, Minnesota, and Jon R. Brakke (on brief), 

Fargo, North Dakota, for plaintiff and appellant.

Austin T. Lafferty (argued) and Scott K. Porsborg (on brief), Special Assistant 

State’s Attorneys, Bismarck, North Dakota, for defendants and appellees.
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Lakeview Excavating, Inc. v. Dickey County

No. 20190195

Tufte, Justice.

[¶1] Lakeview Excavating appeals a district court judgment dismissing its 

complaint against Dickey County and German Township (Defendants) for 

breach of contract, intentional fraud, and misrepresentation. The court ruled 

Lakeview breached its contracts with the Defendants, and held Lakeview’s tort 

claims against the Defendants were barred by the statute of limitations. We

affirm.

I

[¶2] In the spring of 2012, the Defendants awarded to Lakeview three road 

construction project contracts funded by the Federal Emergency Management 

Agency (FEMA). The parties executed three identical contracts, one for each 

project. The contracts required Lakeview to provide the necessary documents

to satisfy FEMA requirements for funding.

[¶3] Lakeview had to use more material than was listed in the bid documents 

to complete the projects. Some of the material used by Lakeview was taken 

from private property without permission and resulted in litigation against 

Lakeview. See Taszarek v. Welken, 2016 ND 172, 883 N.W.2d 880; Taszarek v. 

Lakeview Excavating, Inc., 2019 ND 168, 930 N.W.2d 98. Lakeview completed 

the road construction projects in August 2012.

[¶4] In October 2016, Lakeview sued the Defendants for breach of contract, 

fraud, misrepresentation, and unlawful interference with business. Lakeview 

alleged the Defendants knew the material quantities listed in the bid 

documents provided by them were inaccurate when the documents were 

issued. Lakeview claimed that it relied on the quantities listed in the bid 

documents and that the shortage of materials available to Lakeview resulted 

in a significant cost increase and delayed the projects. Lakeview also claimed

that because it had to devote more resources to the projects, it was unable to 

timely complete additional road construction work in Benson County.
2

[¶5] The Defendants denied Lakeview’s allegations and counterclaimed, 

alleging Lakeview breached the contracts because it failed to provide proper 

paperwork to satisfy FEMA requirements for funding. The Defendants claimed 

FEMA denied funding for the projects because Lakeview did not fulfill its 

obligations under the contracts.

[¶6] Each party moved for summary judgment. The Defendants argued 

Lakeview’s claims were barred by the three-year statute of limitations. The 

Defendants asserted Lakeview knew in May 2012 that the Defendants were

aware of the inaccurate material quantities. The Defendants also argued 

Lakeview breached the contracts for failing to provide documents necessary for 

FEMA funding. The Defendants stated FEMA’s denial of funding caused 

damages of $248,949.14.

[¶7] The district court denied Lakeview’s motion and granted the Defendants’ 

motion. The court concluded Lakeview’s tort claims against the Defendants 

were barred by the three-year statute of limitations. The court ruled Lakeview 

breached the contracts and entered a $249,600.64 judgment against Lakeview.

II

[¶8] Lakeview argues the district court erred in granting the Defendants’ 

motion for summary judgment.

[¶9] This Court’s standard of review for summary judgments is well 

established:

Summary judgment is a procedural device under 

N.D.R.Civ.P. 56(c) for promptly resolving a controversy on the 

merits without a trial if there are no genuine issues of material 

fact or inferences that can reasonably be drawn from undisputed 

facts, or if the only issues to be resolved are questions of law. The 

party seeking summary judgment must demonstrate there are no 

genuine issues of material fact and the case is appropriate for 

judgment as a matter of law. In deciding whether the district court 

appropriately granted summary judgment, we view the evidence 

in the light most favorable to the opposing party, giving that party 

the benefit of all favorable inferences which can reasonably be 
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drawn from the record. A party opposing a motion for summary 

judgment cannot simply rely on the pleadings or on unsupported 

conclusory allegations. Rather, a party opposing a summary 

judgment motion must present competent admissible evidence by 

affidavit or other comparable means that raises an issue of 

material fact and must, if appropriate, draw the court’s attention 

to relevant evidence in the record raising an issue of material fact. 

When reasonable persons can reach only one conclusion from the 

evidence, a question of fact may become a matter of law for the 

court to decide. A district court’s decision on summary judgment is 

a question of law that we review de novo on the record.

Brock v. Price, 2019 ND 240, ¶ 10, 934 N.W.2d 5 (quoting Smithberg v. 

Smithberg, 2019 ND 195, ¶ 6, 931 N.W.2d 211).

III

[¶10] Lakeview argues the district court erred in concluding what it alleges as

its tort claims of actual fraud and intentional misrepresentation, negligent 

misrepresentation, and unlawful interference with business were barred by 

the statute of limitations.

[¶11] Chapter 32-12.1, N.D.C.C., governs tort claims against political 

subdivisions. Finstad v. Ransom-Sargent Water Users, Inc., 2011 ND 215, ¶ 16, 

812 N.W.2d 323. An action brought under N.D.C.C. ch. 32-12.1 “must be 

commenced within three years after the claim for relief has accrued.” N.D.C.C. 

§ 32-12.1-10.

[¶12] Lakeview contends the limitations period began running in October 2014 

when a representative for the County stated the Defendants knew the material 

quantities listed in the bid documents were inaccurate when the documents 

were issued.

Determining when a cause of action accrues is normally a question 

of fact, but it becomes a question of law when the material facts 

are undisputed. The statute of limitations generally begins to run 

from the commission of the wrongful act giving rise to the cause of 

action, unless an exception applies. The discovery rule is one 

exception, and under the discovery rule the accrual of a claim is 
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postponed until the plaintiff knew, or with the exercise of 

reasonable diligence should have known, of the wrongful act and 

its resulting injury. We have said, after acquiring knowledge of 

facts sufficient to put a person of ordinary intelligence on inquiry, 

a party has a responsibility to promptly find out what legal rights 

result from those facts, and failure to do so will be construed 

against the party. The discovery rule does not require full 

knowledge of the extent of an injury; rather, it only requires the 

party be aware of an injury.

Ayling v. Sens, 2019 ND 114, ¶ 11, 926 N.W.2d 147.

[¶13] Lakeview sued the Defendants in October 2016. The district court 

concluded Lakeview had notice of a possible claim and the statute of 

limitations began running on May 7, 2012:

Lakeview’s tort claims arise from the allegation that the 

Defendants were aware the quantities were incorrect but 

deliberately circulated false bid documents nonetheless. It is 

indisputable from the deposition of Brian Welken that Lakeview 

learned the Defendants were aware the quantities were incorrect 

on May 7, 2012. At that moment, Lakeview was on notice that the 

Defendants were aware the quantities were incorrect. Lakeview 

had the responsibility to investigate and find out what legal 

ramifications may [have] resulted from the fact. As a result, the 

statute of limitations accrued in May 2012, and expired in May 

2015. This action was not brought until October 31, 2016. This is 

after the statute of limitations expired and the tort claims are 

therefore barred.

[¶14] Lakeview contends the limitations period began running on October 21, 

2014. Charlie Russell, the County’s emergency management director, testified 

in a deposition that the County knew the material quantities listed in the bid 

documents were inaccurate when FEMA issued the documents. Lakeview 

claims Welken’s knowledge in May 2012 of the County’s awareness of 

inaccurate quantities was limited to a portion of a single project and not the 

whole project.
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[¶15] In May 2012, Welken learned of the County’s awareness of material 

shortages during a conversation with Russell. At Welken’s deposition, he was 

asked, “[On May 7, 2012,] was your awareness of the material shortage 

confined to site 7-11?” Welken responded, “At that time it was confined to site 

7-11, but it was making us concerned about the rest of the projects after our 

conversation with Charlie [Russell].” Welken testified he became aware of 

additional material deficiencies as “the job was ongoing.” Although Welken 

knew in May 2012 about the County’s awareness of material deficiencies for 

only a portion of the project, he testified he was “concerned about the rest of 

the projects.” He testified he recognized additional shortages as the work 

continued. Welken’s initial knowledge in May 2012 and his subsequent 

knowledge of additional deficiencies as the job continued through its 

completion on August 15, 2012, should have led Lakeview to inquire whether 

the County knew of the material deficiencies for the whole project when it 

issued the bid documents. Ayling, 2019 ND 114, ¶ 11, 926 N.W.2d 147 (stating 

the discovery rule does not require full knowledge of the extent of an injury).

[¶16] We conclude the statute of limitations barred Lakeview’s tort claims 

when it sued the Defendants in October 2016. The district court did not err in 

granting the Defendants’ motion for summary judgment relating to Lakeview’s 

tort claims.

IV

[¶17] Lakeview asserts the district court erred in dismissing its breach of 

contract claim against the Defendants. Lakeview also argues the court erred 

in ruling Lakeview breached its contracts with the Defendants.

[¶18] “A breach of contract is the nonperformance of a contractual duty when 

it is due.” Swenson v. Mahlum, 2019 ND 144, ¶ 19, 927 N.W.2d 850. A party 

asserting a breach of contract must prove: (1) the existence of a contract; (2) a 

breach of the contract; and (3) damages flowing from the breach. Id.
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A

[¶19] Lakeview’s complaint alleged, “The failure of Dickey County and German 

Township to allow reasonable accommodations for Lakeview to complete the 

Projects so that Lakeview could reallocate resources to Benson County constitutes 

a breach of the Defendants’ Contracts with Plaintiff.” Lakeview claims the 

material quantities contained in the bid documents were incorporated into the 

three contracts with the Defendants. Lakeview asserts the shortage of 

materials caused it to spend more time on the project and it was unable to 

complete the Benson County project on time, resulting in liquidated damages.

[¶20] In dismissing Lakeview’s breach of contract claim, the district court 

concluded:

The contracts between the parties lack any clause or 

provision which required the Defendants to allow reasonable 

accommodations for Lakeview’s work on other projects. Further, 

any alleged breach due to the incorrect quantities cannot be a 

breach because the contracts do not guarantee a specific quantity 

or even a correct quantity. Lakeview claims there is a genuine 

dispute of fact as to whether the Defendants’ alleged utilization of 

incorrect quantities is a breach of contract; however, there is no 

contractual provision that would have been breached by such. 

Accordingly, there is no genuine dispute of fact and Lakeview’s 

claim for breach of contract cannot succeed.

[¶21] We agree with the district court. The contracts do not include a term 

specifying the material quantities for the job, nor do they require 

accommodations allowing Lakeview to work on other projects. The district 

court did not err in granting the Defendants’ motion for summary judgment on 

Lakeview’s breach of contract claim.

B

[¶22] Lakeview asserts the district court erred in concluding Lakeview 

breached its contracts with the Defendants.

[¶23] The three contracts state, “The Contractor will be responsible for all 

documentation and paper work required to satisfy the FEMA requirements.” 
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FEMA denied funding for the road construction projects because “the 

contractor [Lakeview] failed to obtain the appropriate bonding required for the 

contract,” and Lakeview used materials from private property without 

permission and without completing a cultural survey at the site where the 

materials were taken. The district court ruled that under the contracts’ 

language, there was no genuine dispute of fact that Lakeview breached its 

obligations under the contracts because it did not provide the required 

documents necessary for FEMA funding.

[¶24] Lakeview does not dispute it did not obtain the bonds required by FEMA. 

Lakeview argues the Defendants should have requested or required Lakeview 

to obtain or submit the bonds required for FEMA funding. Lakeview also 

asserts that the County later accepted responsibility for not obtaining the 

bonds in its communications with FEMA.

[¶25] We are not persuaded by Lakeview’s arguments. The three contracts 

plainly state “[Lakeview] will be responsible for all documentation and paper

work required to satisfy the FEMA requirements” for funding. See N.D.C.C. 

§ 9-07-02 (stating the “language of a contract is to govern its interpretation if 

the language is clear and explicit”). The contracts do not require the 

Defendants to request that Lakeview obtain or submit additional bonds. We 

conclude the district court did not err in granting summary judgment on the 

Defendants’ breach of contract claim.

V

[¶26] Lakeview’s remaining arguments are either without merit or not 

necessary to our decision. The judgment is affirmed.

[¶27] Jerod E. Tufte 

Daniel J. Crothers 

Lisa Fair McEvers

Gerald W. VandeWalle 

Jon J. Jensen, C.J.