Court Opinion

ID: 9737026
Source: CourtListenerOpinion
Date Created: 2023-08-26 19:13:19.358647+00
Date Added: 2024-06-11T07:23:56.004213
License: Public Domain

NORTON, Judge
(dissenting).
I respectfully dissent. I believe the language of the supplementary purchase agreement is ambiguous; and after looking at the surrounding circumstances of this transaction, that the trial court clearly erred in finding that the parties intended to increase the purchase price, rather than to modify the terms of the promissory note.
Whether a contract is ambiguous is a legal question, and therefore not subject to the clearly erroneous standard of review. Western Contracting Corp. v. Dow Chemical Co., 664 F.2d 1097, 1100 (8th Cir.1981). A contract is ambiguous if it is susceptible to more than one interpretation based on its language alone. Lamb Plumbing & Heating Co. v. Kraus-Anderson, 296 N.W. 2d 859, 862 (Minn.1980). This supplemental agreement must be read in context with the original agreement. Chase Manhattan Bank, N.A. v. Clusiau Sales & Rental, Inc., 308 N.W.2d 490 (Minn.1981).
I believe the language in the supplemental agreement, “In addition to the consideration previously provided the Buyers agree to pay Seller an additional Seven Thousand,” is ambiguous. The original agreement provides that the buyer was to pay $23,000 on or before the day of closing and $7,000 two years later. When viewed in this light it is unclear whether the parties meant the money “previously paid” at the time the supplemental agreement was executed, or the purchase price “previously set out” in the prior agreement.
Because I believe the agreement language is ambiguous, extrinsic evidence must be considered to ascertain the meaning and the intent of the parties. Kehne Electric Co. v. Steenberg Construction Co., 287 Minn. 193, 196, 177 N.W.2d 309, 311 (1970). The court must view the agreement as a whole, and the plain language of the agreement, in the light of the surrounding circumstances of the parties at the time the agreement was negotiated and executed. Midway Center Assocs. v. Midway Center, Inc., 306 Minn. 352, 356, 237 N.W. 2d 76, 78 (1975).
The majority’s view that a buyer would unilaterally ask for an increase in the sales price, flies in the face of human nature. In focusing on the negotiations between the parties, I believe it lacks all credibility that the buyer would ask the seller for an addition to their agreement which would require Rigi, the buyer, to pay an additional $7000 over the $30,000 purchase price provided for by the prior agreement. I believe that the parties intended the consideration “previously provided” to be the money previously paid, which at that time was $23,-000 and that the parties agreed to have the remaining $7000 payment be based upon the amount of business Rigi did. Additionally, Mutsch, the seller, admitted on cross-examination that the $7000 promissory note was governed by the terms in the supplemental agreement.
I believe both the trial court and the majority err in finding that two separate $7000 amounts are intended by the parties. The supplemental agreement clearly references to the original purchase agreement, and the original purchase agreement includes the $7000 promissory note as part of the purchase price, to be paid two years later. The supplemental agreement is certainly meant to substitute the absolute $7000 promissory note payment in two years, for a new provision which makes the $7000 amount contingent on how well the business has done in two years.
The majority finds it significant in interpreting the meaning of this contract that Mutsch brought a claim to enforce the promissory note. While Mutsch may have brought a claim to collect money owed pursuant to the promissory note, Mutsch is not entitled to collect on this claim if the contingencies in the supplemental agreement were not fulfilled.
*206I believe the trial court clearly erred, in light of the negotiations and the surrounding circumstances of the parties, in finding that the parties intended the $7000 in the supplemental agreement to be additional to the $30,000 purchase price “previously set out” in the prior agreement, rather than additional to the $23,000 “previously paid” by the buyer.