IN THE SUPREME COURT

STATE OF NORTH DAKOTA

2022 ND 193

Ordahl, LLC, Plaintiff and Appellant

 v.

Arlene Lykken, Bruce Lykken, 

Paul Lykken, and Sandra Teske, Defendants and Appellees

No. 20220115

Appeal from the District Court of Cass County, East Central Judicial District, 

the Honorable John C. Irby, Judge.

REVERSED AND REMANDED.

Opinion of the Court by Jensen, Chief Justice.

Kasey D. McNary, Fargo, ND, for plaintiff and appellant.

Andrew D. Cook, West Fargo, ND, for defendants and appellees.

FILED 

IN THE OFFICE OF THE 

CLERK OF SUPREME COURT 

NOVEMBER 10, 2022 

STATE OF NORTH DAKOTA
1

Ordahl v. Lykken

No. 20220115

Jensen, Chief Justice.

[¶1] Ordahl LLC (“Ordahl”) appeals from a district court order granting 

Arlene Lykken, Bruce Lykken, Paul Lykken, and Sandra Teske’s (“the 

Lykkens”) motion for summary judgment and denying Ordahl’s motion for 

summary judgment. We conclude the court erred in determining the purchase 

agreement required Ordahl to terminate the agreement and limited Ordahl to 

a recovery of its earnest money. We reverse and remand this case for

consideration of whether Ordahl should prevail on its equitable claim to 

enforce the terms of the parties’ agreement through specific performance and, 

if necessary, consider the Lykkens’s request for reformation of the agreement.

I

[¶2] Ordahl and the Lykkens executed a purchase agreement for the sale of 

12 acres of land and an easement on adjacent property to the north of the 

parcel. Under the terms of the purchase agreement, Ordahl was required to 

provide a $10,000 earnest money payment.

[¶3] After the purchase agreement was signed, the Lykkens anticipatorily 

breached the agreement. Ordahl brought suit seeking a declaratory judgment 

declaring that Ordahl’s relief was not limited to the return of its earnest money.

Ordahl claimed it was not required to terminate the parties’ agreement and 

was entitled to enforce the terms of the agreement through the equitable 

doctrine of specific performance. The Lykkens counterclaimed seeking 

reformation of the purchase agreement.

[¶4] Both parties moved for summary judgment. The district court focused on

the interpretation of Section 12 of the parties’ agreement which provides as 

follows:

12. Remedies. If Buyer defaults under this Agreement, Seller shall

have the right to terminate this Agreement by giving written

notice thereof to Buyer. If Buyer fails to cure such default within

thirty (30) days after notice of cancellation, then this Agreement
2

will terminate, and upon such termination Seller will be entitled 

to receive and retain the Earnest Money as liquidated damages, as 

its sole and exclusive remedy and Buyer expressly waives and 

releases any and all claims for incidental or consequential

damages, time being of the essence of this Agreement. If Seller 

defaults under this Agreement, Buyer may terminate this 

Agreement and recover the Earnest Money as its sole and exclusive 

remedy and Buyer expressly waives and releases any and all claims 

for incidental or consequential damages.

(Emphasis added.) The court found the phrase “sole and exclusive 

remedy” to be unambiguous and held Ordahl was limited to termination 

of the agreement and the recovery of its earnest money. The court 

granted the Lykkens’s motion for summary judgment and dismissed 

Ordahl’s claims. Having dismissed Ordahl’s claims it was unnecessary 

for the court to resolve the Lykkens’s counterclaim for reformation.

II

[¶5] The standard for reviewing summary judgment 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 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. 
3

A district court’s decision on summary judgment is a question of 

law that we review de novo on the record.

Solberg v. McKennett, 2021 ND 44, ¶ 6, 956 N.W.2d 767 (quoting Aftem Lake 

Dev., Inc. v. Riverview Homeowners Ass’n, 2020 ND 26, ¶ 8, 938 N.W.2d 159).

[¶6] “Interpretation of a contract is a question of law if the intent of the 

parties can be ascertained from the agreement alone.” Airport Inn Enters., Inc. 

v. Ramage, 2004 ND 92, ¶ 10, 679 N.W.2d 269. A trial court’s finding regarding 

the legal effect of terms of a contract is a question of law, which is fully 

reviewable on appeal. Northstar Founders, LLC v. Hayden Capital USA, LLC, 

2014 ND 200, ¶ 45, 855 N.W.2d 614. “On appeal, this Court will independently 

review a contract to determine whether the district court erred in its 

interpretation of it.” Airport Inn, at ¶ 10. “We construe contracts to give effect 

to the parties’ mutual intent at the time the contract was formed.” Northstar, 

at ¶ 45. If possible, we will look to the language of the contract alone to 

determine the parties’ intent. N.D.C.C. § 9-07-04. Words are given their 

ordinary and popular meaning unless the words are used in a technical sense 

or given a special meaning. Myaer v. Nodak Mut. Ins. Co., 2012 ND 21, ¶ 10, 

812 N.W.2d 345. When interpreting a contract, we will read the contract as a 

whole to give effect to each provision. N.D.C.C. § 9-07-06. Whether a contract 

is ambiguous is a question of law. Northstar, at ¶ 47.

[¶7] We conclude the purchase agreement is clear and unambiguous. The 

relevant clause of Section 12 provides: “If Seller defaults under this 

Agreement, Buyer may terminate this Agreement and recover the Earnest 

Money as its sole and exclusive remedy and Buyer expressly waives and 

releases any and all claims for incidental or consequential damages.” The plain 

meaning of the terms within Section 12 provide as follows: 1) in the event of a 

breach by the Lykkens, Ordahl may choose to terminate the contract, and 2) if 

Ordahl chooses to terminate the agreement, Ordahl’s relief is limited to a 

recovery of its earnest money.

[¶8] The district court found no ambiguity in the purchase agreement, but 

concluded the purchase agreement required Ordahl to terminate the 

agreement and limited Ordahl to the return of its earnest money. The court 
4

further found the agreement precluded Ordahl from pursuing the equitable 

action of specific performance, summarizing as follows: “Ordahl may walk 

away from the agreement with or without the recovery of the earnest money.”

[¶9] While we agree the purchase agreement is unambiguous, we conclude 

the district court’s interpretation of Section 12 is incorrect. The court ignored 

the first clause of the provision which provides Ordahl with the option to 

terminate the agreement and, instead, found the phrase “sole and exclusive 

remedy” to be determinative, limiting Ordahl to a return of the earnest money. 

While the phrase “sole and exclusive remedy” is intended to limit Ordahl’s 

recovery if Ordahl were to choose to terminate the agreement, we interpret 

contracts as a whole to give effect to each provision. N.D.C.C. § 9-07-06. As 

discussed in the following paragraph, giving effect to each provision provides

Ordahl with the choice of whether or not the contract is terminated, followed 

by the limitation of the post-termination remedy if termination is chosen by 

Ordahl.

[¶10] Before the phrase “sole and exclusive remedy” is the phrase “may 

terminate.” The words “may” and “terminate” in the clause are essential to the 

interpretation of Section 12. The district court found “[t]he term ‘may’ does not 

alter the remaining provisions of the Purchase Agreement” or allow Ordahl the 

option not to terminate the agreement. This is contrary to the plain meaning 

of the language. “The word ‘may’ is, when used in its ordinary meaning, 

permissive rather than compulsory.” Harding v. City of Dickinson, 33 N.W.2d 

626, 632 (N.D. 1948). We have held that the use of the word “may” in a 

statutory scheme is ordinarily understood as permissive rather than 

mandatory. Midthun v. N.D. Workforce Safety & Ins., 2009 ND 22, ¶ 12, 761 

N.W.2d 572 (quoting In re Adoption of K.S.H., 442 N.W.2d 417, 420 (N.D. 

1989)). We will only construe the word “may” as “must” where the context of 

the subject matter compels that construction. Id. at ¶ 13. The context here does 

not compel the construction of “may” as mandatory. Giving words their 

ordinary and popular meaning, we conclude the term “may” is permissive in 

this instance. Myaer, 2012 ND 21, ¶ 10. Ordahl may choose to terminate the 

purchase agreement or Ordahl may choose not to terminate the purchase 

agreement.
5

[¶11] The district court’s interpretation was premised on the assumption that 

Ordahl’s only option was to terminate the contract, seek a legal remedy as 

provided in the contract, and that specific performance is precluded because it 

is a remedy imposed following the termination of an agreement. We disagree. 

Our case law provides that specific performance is used to compel the 

performance of the obligations under the agreement, not a remedy following 

an early termination of an agreement.

[¶12] In Jonmil, Inc. v. McMerty, 265 N.W.2d 257, 261 (N.D. 1978) we 

recognized the plaintiff could not both “cancel the contract and at the same 

time sue for its specific performance.” We have also recognized the following 

with regard to specific performance:

[1] Specific performance is an equitable action, the

purpose of which is to compel parties to agreements to 

perform what they have contracted to do. 81 C.J.S. Specific 

Performance § 1b, p. 408.

[2] The remedy of specific performance is purely

equitable, and is available to a party who is injured or 

damaged by a breach of an agreement or contract. Though it 

is an equitable action, it is available to enforce agreements 

even though the injured party may have a legal remedy for 

damages, because in many cases an action for damages 

would not afford adequate relief. In such cases, equity 

permits the specific performance of the agreement of the 

parties on the theory that the most just termination of any 

contract is its complete performance by all parties in 

accordance with its terms. When parties enter into an 

agreement, each expects to receive certain benefits 

therefrom, and they never can be fully compensated unless 

such parties perform in accordance with the terms and 

provisions of their agreement.

Larson v. Larson, 129 N.W.2d 566, 567 (N.D. 1964). Recently, we recognized 

that specific performance was an equitable action “available to enforce 

agreements . . . .” Dale Expl., LLC v. Hiepler, 2018 ND 271, ¶ 9, 920 N.W.2d 

750 (quoting Larson, at 567). We have also noted “[s]pecific performance would 
6

require the parties to perform their respective contractual promises.” Huber v. 

Oliver Cty., 529 N.W.2d 179, 183 (N.D. 1995) (citing 71 Am.Jur.2d. Specific 

Performance § 211 (1973)).

[¶13] Because specific performance requires parties to perform their 

contractual promises, specific performance is inconsistent with termination of 

the agreement. See RESTATEMENT (SECOND) OF CONTRACTS § 378 cmt. d (1981)

(“The remedy of specific performance or an injunction and that of restitution 

are also inconsistent.”). See also 18 Wash. Prac., Real Estate § 21.26 (2d ed.) 

(2022) (“Forfeiture and specific performance are totally inconsistent remedies, 

one supposing the contract to be terminated and the other supposing it to be 

subsisting.”). See also 28A C.J.S. Election of Remedies § 15 (2022) (“As a general 

rule, a remedy based on the theory of the affirmance of a contract or other 

transaction is inconsistent with a remedy arising out of the same facts and 

based on the theory of its disaffirmance, or rescission[.]”). Other courts have 

similarly held specific performance is distinct from termination of the 

agreement. In reviewing a claim for specific performance, the Eastern Division 

of the United States District Court of Illinois noted “[t]ermination, like 

rescission, extinguishes the parties’ remaining obligations, such that there is 

nothing to perform, making specific performance entirely inconsistent with the 

self-help termination remedy under the contract.” 12 Corbin on Contracts § 

66.9 (2022) (quoting Lone Star-Cardinal Motorcycle Ventures VIII, LLC v. BFC 

Worldwide Holdings, Inc., 2016 WL 3671504, *3 (N.D. Ill. 2016)).

[¶14] By seeking specific performance, Ordahl chose not to terminate the 

contract, an option consistent with the phrase “may terminate.” Therefore, the 

district court’s finding that under the contract Ordahl’s only option was to 

terminate the agreement was incorrect. The court’s interpretation would 

render meaningless the phrase “may terminate” and require Ordahl, upon a 

breach by the Lykkens, to terminate the agreement and recover its earnest 

money. The court’s interpretation modifies the phrase from the permissive

“may terminate” to the mandatory “shall terminate.” When reading the entire 

phrase as a whole, it is clear Ordahl has the option to terminate the parties’

agreement and, if the agreement is terminated, Ordahl’s legal remedy would 

only be limited to return of its earnest money. Alternatively, Ordahl has the 
7

option not to terminate the purchase agreement and may instead seek specific 

enforcement of the agreement. The court’s interpretation fails to recognize that 

specific performance is an equitable remedy enforcing the terms of an 

agreement, not a remedy following the termination of an agreement. We 

further note that specific performance is not an absolute right, but is an 

equitable remedy, and the district court will need to follow equitable principles 

to determine if it is appropriate in this case. Wolf v. Anderson, 334 N.W.2d 212, 

215 (N.D. 1983).

III

[¶15] We conclude the unambiguous language of the purchase agreement 

allowed Ordahl the option to terminate the purchase agreement upon breach 

by the Lykkens with the sole and exclusive legal remedy of a return of its 

earnest money. However, Ordahl chose not to terminate the agreement and 

instead sought the equitable relief of specific performance to enforce the 

parties’ obligations under the terms of the agreement. We reverse the district 

court’s grant of summary judgment in favor of the Lykkens, reverse the finding 

that Ordahl is limited to return of its earnest money, and remand for findings 

on whether Ordahl is entitled to specific performance and, if necessary, 

consideration of the Lykkens’s reformation claims.

[¶16] Jon J. Jensen, C.J.

Gerald W. VandeWalle

Daniel J. Crothers

Lisa Fair McEvers

Jerod E. Tufte