Opinion ID: 1347565
Heading Depth: 1
Heading Rank: 3

Heading: Oral farm agreement.

Text: The parties also entered into an oral farm partnership in 1990 which was to run for two years. It appears it is customary in the industry to have such contracts by oral agreement. Each party contributed their respective land to the Agricultural Stabilization and Conservation Service (ASCS) program to increase their acreage base and maximize their benefits. This program was a price support program for wheat farmers. Each party had certain prescribed duties under the agreement. Olsen was to receive 60 percent and Airheart 40 percent of the ASCS payments and any profits from the sale of the grain. [2] After one year under the agreement, Olsen sold 2,400 acres which were part of the oral agreement. Airheart claims Olsen breached the agreement because of the premature withdrawal of these acres. There was testimony, over objection, that the acres would have yielded 38 bushels per acre. Airheart's damages were calculated by multiplying the number of bushels per acre, 30, times $3.10 price per bushel, times 2,400 acres, times Airheart's 40 percent interest, equalling $105,280.00. Olsen objected to this damage assessment because the claim of 2,400 acres of wheat base acres removed is without support in the evidence, is a claim for net profit from unfurnished seed, fuel not provided and work never performed. 2. Whether the trial court properly calculated the damages for breach of the farming agreement? [T]he amount of damages to be awarded is a factual issue to be determined by the trier of fact[.] Sander v. The Geib, Elston, Frost Professional Assoc., 506 N.W.2d 107, 119 (S.D.1993) (citation omitted). When reviewing questions of fact on appeal, this Court defers to the fact finder and will not overturn its decision unless clearly erroneous. Permann v. Dept. of Labor, Unemployment Ins. Div., 411 N.W.2d 113, 115 (S.D.1987). The trial court's assessment of damages was as follows: 30 bushels per acre times $3.10 per bushel = $93.00 2400 acres times $93.00 per acre = $223,200.00 total $223,200.00 times Airheart's 40 percent interest = $89,280.00; $89,280.00 plus 40 percent of the $40,000 ASCS payment = total lost profits of $105,280.00. The trial court found the average yield per acre would be 30 bushels, although testimony indicated that the land yielded 38 bushels per acre the previous year. The trial court did not state whether lowering the number of bushels was to offset the price of fuel, labor and seed, which Airheart was required to provide under the agreement. Olsen objected as indicated above. Therefore, this amount represents gross profit, not net profit. The trial court should have subtracted Airheart's expenses for labor and materials under the agreement. See Winterton v. Elverson, 389 N.W.2d 633, 637 (S.D.1986) (loss of crop damages assessment must subtract necessary expenses). A damages computation error may be corrected on appeal. Id. It was error to assess damages without considering that Airheart would be required to provide labor and other materials if the acres had been farmed. See Id. We reverse and remand to the trial court to reduce the damages by considering Airheart's expenses under the agreement. MILLER, C.J. and AMUNDSON and KONENKAMP, JJ., concur. GILBERTSON, J., not having been a member of the court at the time this case was submitted, did not participate.