Opinion ID: 901580
Heading Depth: 1
Heading Rank: 5

Heading: Present Intent to Assign the Loan

Text: [¶16.] The trial court found that the Minutes do not demonstrate clear evidence of a present intent to assign the 1804 Store loan. The Court stated in Northstream I that it must be clear that the party intended a present transfer of rights and did not merely bind himself to make a future transfer. 2005 SD 61, ¶ 15, 697 NW2d at 766. Typically, any language, however informal, will be sufficient to show the intent of the assignor. Id. The Court in Northstream I determined from the Minutes that an ambiguity or fact question existed concerning whether Security Bank's Board of Directors intended their action to be a present assignment of their interest, or a statement merely authorizing the assignment to be carried out at a later date. Id. ¶ 20. Because there was absence from the record of any testimony as to the intent of the [directors] the Court remanded the case for such evidence to be received and considered. Id. [¶17.] We have held that where a contract is uncertain or ambiguous, parol or extrinsic evidence may be used to determine the parties' intent. Kling v. Stern, 2007 SD 51, ¶ 8, 733 NW2d 615, 618; Hanks v. Corson County Board of County Commissioners, 2007 SD 10, ¶ 10, 727 NW2d 296, 301 (quoting Pauley v. Simonson, 2006 SD 73, ¶ 8, 720 NW2d 665, 668 (citing Jensen v. Pure Plant Food Intern., Ltd., 274 NW2d 261, 263-264 (SD 1979))). The trial court received parol evidence consistent with the directive in Northstream I, but did not consider this uncontroverted testimony on the issue of the intent to assign. [¶18.] This evidence shows that December 22 was the final meeting of Security's directors. Security's directors intended and believed the remaining assets, including the 1804 Store loan, were assigned from Security to Northstream at the meeting. Following this meeting, the attorney handling Security's liquidation sent Nordstrom a letter on January 15, 1993, stating, I understand you have completed the transfer of all of the assets of the Bank to the Bank's shareholders. . . . This letter directs Nordstrom to send the final report of Security's liquidation to the Comptroller of the Currency. Nordstrom sent the final report of liquidation to the Comptroller of the Currency, along with the Bank's original charter, on January 21, 1993. The final report of liquidation, signed by Nordstrom as being true and correct, represented that Security had no remaining assets. [¶19.] The 1804 Store presented no evidence to dispute this testimony. Wald testified that he questioned whether an assignment was made to Northstream. However, the 1804 Store began making monthly payments to Northstream after being advised that the loan was transferred to Northstream. The 1804 Store continued to do so for more than six years until the default occurred. [¶20.] The trial court's findings of fact on the issue of intent are subject to the clearly erroneous standard of review. Under clearly erroneous review, [w]e will overturn the trial court's findings of fact on appeal only when a complete review of the evidence leaves the Court with a definite and firm conviction that a mistake has been made. Hanks, 2007 SD 10, ¶ 9, 727 NW2d at 301. In Hanks, we upheld the trial court's interpretation of an ambiguous contract where the trial court properly considered the contract language together with extrinsic evidence to determine the intended scope of the agreement. Id. ¶ 10. [¶21.] In its memorandum opinion incorporated into the findings of fact and conclusions of law, the trial court stated that it believed testimony that Security's directors intended to transfer the remaining assets from Security to Northstream at the December 22, 1992 meeting. However, the trial court rejected this extrinsic evidence stating that this intent must be expressed in writing, which it is not. The trial court's failure to consider the extrinsic evidence was contrary to the Court's direction in Northstream I to consider testimony as to the intent of the directors of Security at the December 22, 1992 meeting. [¶22.] The Minutes provide satisfactory written evidence under the statute of frauds to show that Security intended to assign its remaining assets to Northstream. The undisputed testimony, which the trial court believed, clearly shows that Security had a present intent at the December 22, 1992 meeting to make an assignment to Northstream. We are convinced on this record that the trial court was clearly erroneous in determining otherwise.