Court Opinion

ID: 2801620
Source: CourtListenerOpinion
Date Created: 2015-05-18 20:09:04.92808+00
Date Added: 2024-06-11T12:21:59.978200
License: Public Domain

This opinion will be unpublished and
                        may not be cited except as provided by
                        Minn. Stat. § 480A.08, subd. 3 (2014).

                            STATE OF MINNESOTA
                            IN COURT OF APPEALS
                           A14-0637, A14-1215, A14-1525

                                 Bemidji Township,
                                    Appellant,

                                         vs.

                                   City of Bemidji,
                                    Respondent,

                                 Northern Township,
                                    Respondent.

                                 Filed May 18, 2015
                                      Affirmed
                                   Hooten, Judge

                           Beltrami County District Court
                              File No. 04-CV-12-2601

John J. Steffenhagen, Hellmuth & Johnson, PLLC, Edina, Minnesota (for appellant)

James J. Thomson, Kennedy & Graven, Chartered, Minneapolis, Minnesota (for
respondent City of Bemidji)

Jason J. Kuboushek, Iverson Reuvers Condon, Bloomington, Minnesota (for respondent
Northern Township)

      Considered and decided by Stauber, Presiding Judge; Cleary, Chief Judge; and

Hooten, Judge.
                         UNPUBLISHED OPINION

HOOTEN, Judge

       Appellant-township and respondent-city entered into a mediated settlement

agreement which, as the result of a binding arbitration proceeding, was determined to be

in full force and effect as to essentially all of its provisions and binding upon the parties.

In these consolidated appeals, appellant asserts that the district court erred by:

(1) confirming the arbitration award on terms other than those in the award;

(2) dismissing its pending district court action against respondents; (3) denying its motion

to amend its complaint; (4) dissolving a temporary injunction in its favor; (5) enforcing

the resulting judgment and ordering injunctive relief for respondent-city; and (6) staying

its post-appeal arbitration demand to determine whether appellant’s claims were barred

by the mediated settlement agreement. We affirm.

                                          FACTS

       The genesis of these proceedings was a number of agreements entered into by

appellant Bemidji Township (the Township), respondent City of Bemidji (the City), and

respondent Northern Township pursuant to Minn. Stat. § 414.0325, subd. 6 (2014): a

November 2004 orderly annexation agreement amended in March 2011 (OAA), and a

January 2005 joint powers agreement (JPA) revised in December 2007 (R-JPA). The

OAA provided that the City would annex certain properties of both townships and also

detach a few City properties to Bemidji Township. As provided for in the OAA, the JPA

and R-JPA created the Greater Bemidji Area Joint Planning Board and empowered the

board to handle zoning and land use issues for all three entities.

                                              2
      This consolidated appeal by the Township is from three separate orders and

judgments issued by the district court arising out of an action filed by the Township

against the City in August 2012. In its complaint, the Township alleged that the City had

repeatedly breached numerous provisions of the OAA by, in part, improperly annexing

properties and failing to provide proper municipal utility services to annexed properties.

The Township sought $50,000 in damages and a declaratory judgment that the OAA was

unenforceable due to the alleged breaches.

      A mediated settlement agreement resolving the suit was approved by the

governing bodies of both parties and took effect on June 11, 2013. Among other things,

the settlement agreement provided that the OAA and R-JPA would “be amended to

release [the] Township as a party,” with the caveat that such amendment would be

“[s]ubject to the approvals noted below.” The settlement agreement further stated that

“[a]ny approvals needed by Northern Township to effectuate this Mediated Settlement

Agreement must be obtained in order for this agreement to be effectuated.” Finally, the

mediated settlement agreement provided that “[a]ny dispute(s) and/or questions of any

kind or nature regarding this Settlement shall be decided by Binding Arbitration.”

      However, the board of Northern Township, which at this point was not a party to

the breach-of-contract action or the mediated settlement agreement, voted against

approving the agreement.     The City and the Township disagreed as to what effect

Northern Township’s lack of approval had on the validity of the settlement agreement.

To resolve this dispute, the City demanded arbitration on July 31, 2013, in accordance

with the settlement agreement’s arbitration clause. During the arbitration process, both

                                             3
parties also moved the district court for temporary injunctions in the still-pending district

court action.

       On October 24, 2013, the arbitrator issued his award. The arbitrator found that

“[a]ny provision of the [settlement] [a]greement that involves Northern under the [OAA]

and [the R-JPA] must have Northern’s approval to be enforced.” He then found that the

settlement term releasing the Township from the OAA and JPA required Northern

Township’s approval, while the other terms of the settlement agreement between the

Township and the City did not. He therefore concluded that the settlement agreement

was enforceable and binding upon the Township and the City, but the provision releasing

the Township from the OAA and the JPA could not take effect until and unless Northern

Township approved. Neither the Township nor the City sought modification of the

arbitration award.

       The City moved to confirm the arbitration award on November 14, shortly after

the district court heard oral argument on the pending cross-motions for injunctive relief

on October 30. The district court ruled on the injunction motions on December 3,

granting injunctive relief for the Township and enjoining the City from taking any action

that affected the planning and zoning authority of the Township. The district court also

sua sponte joined Northern Township as an indispensable party to the action. After its

joinder, Northern Township filed a notice of removal and a new district court judge was

assigned to the case.

       While the City’s motion to confirm the arbitration award was still pending before

the newly-assigned district court judge, the Township moved to amend its complaint.

                                             4
The proposed amended complaint added Northern Township and the joint planning board

as parties and now sought declaratory relief and damages for breach of the OAA and the

R-JPA.

       In a March 20, 2014 order and accompanying judgment, the district court

concluded that the mediated settlement agreement had fully and finally resolved the

lawsuit due to the arbitrator’s determination that the settlement agreement was in full

force and effect, save for the provision releasing the Township from the OAA and R-JPA.

Accordingly, the district court (1) granted the City’s motion to confirm the arbitration

award; (2) denied the Township’s motion to amend its complaint; (3) vacated the

temporary injunction; and (4) dismissed with prejudice all claims in the case.         The

Township appealed from this order and judgment on April 18.

       On May 1, the Township demanded further arbitration with the City, seeking a

determination as to whether the prior arbitration award adjudicated the merits of the

underlying court action and barred its assertion of other claims. On May 14, the City

moved the district court to stay this arbitration demand. The City also moved for an

order enforcing the March 20 order and judgment, claiming that the Township was

refusing to comply with the court order and participate in the joint planning board.

       In a June 2, 2014 order, the district court granted the City’s motion to enforce the

district court’s prior order and judgment and ordered the Township to act in compliance

with the OAA and the R-JPA. The district court also granted the City’s motion to stay

arbitration, but noted that this stay was partially dependent on the outcome of the

                                             5
Township’s second lawsuit against the same defendants in a separate proceeding.1 The

district court then awarded costs, disbursements, and attorney fees to the City and

Northern Township. The Township appealed from this order and also appealed from a

later order and judgment confirming the amount of costs, disbursements, and attorney

fees awarded to the City and Northern Township. This court consolidated these two

appeals with the Township’s appeal from the March 20 order and judgment.

                                     DECISION

       The Township raises numerous challenges to the district court’s decisions in this

case. While it strenuously argues that the district court made a number of procedural

errors requiring us to reverse and thus revive this litigation, absent from those arguments

is the acknowledgement that the district court’s rulings were premised on a mediated

settlement agreement between the Township and the City and a binding arbitration award

interpreting the mediated settlement. “Settlement of disputes without litigation is highly

favored, and such settlements will not be lightly set aside by the courts.” Johnson v. St.

Paul Ins. Co., 305 N.W.2d 571, 573 (Minn. 1981) (citation omitted). Absent fraud,

misrepresentation, or mutual mistake of fact, we uphold settlements between equally-

situated parties, even if “a judicial decision should afterwards be made showing that these

rights were different from what they supposed them to be, or showing that one of them

1
  On March 24, 2014, the Township filed a second lawsuit against the City, Northern
Township, and the joint planning board, again alleging violations of the OAA and R-JPA.
On October 28, 2014, the district court dismissed nearly all of the claims brought by the
Township on the basis that such claims were barred by res judicata and collateral
estoppel, or were resolved by the mediated settlement agreement. This order has been
separately appealed and, after we denied consolidation with this case, is currently
pending before this court.

                                            6
had no rights at all, and so nothing to forego.” N. States Power Co. v. City of Sunfish

Lake, 659 N.W.2d 271, 274 (Minn. App. 2003) (quoting Johnson, 305 N.W.2d at 574),

review denied (Minn. June 25, 2003). Likewise, arbitration is also a proceeding favored

in law. Seagate Tech., LLC v. W. Digital Corp., 834 N.W.2d 555, 559 (Minn. App.

2013), aff’d, 854 N.W.2d 750 (Minn. 2014).            Thus, we evaluate the Township’s

arguments while remaining cognizant of the “strong public policy interest in the finality

of settlements.” Johnson, 305 N.W.2d at 574.

                                             I.

       The Township makes a number of challenges to the district court’s March 20,

2014 order and judgment that resulted in the dismissal of this action. We address each of

them in turn.

   A. Confirmation of the Arbitration Award

       The district court confirmed the arbitration award in its March 20 order.       It

correctly noted that it was “compel[led]” to confirm the arbitration award under the

Minnesota Uniform Arbitration Act (MUAA), as the statute provides that the district

court “shall” confirm an award unless the award is otherwise modified, corrected, or

vacated. See Minn. Stat. § 572B.22 (2014). The Township made no motion to modify,

correct, or vacate the award within the statutory time limits.           See Minn. Stat.

§§ 572B.20(b), .23(b), .24(a) (2014) (providing deadlines for moving the arbitrator or

district court for modification, correction, or vacation of an award).

       The Township now argues that the district court’s March 20 order, along with that

order’s later enforcement in the June 2 order, “substantially expanded the breadth and

                                              7
terms of the [a]rbitration [award]” in violation of the MUAA. The Township points to

language in the MUAA providing that when the district court grants an order confirming

an arbitration award, “the court shall enter a judgment in conformity therewith.” Minn.

Stat. § 572B.25(a) (2014).      The Township claims that the district court erred by

interpreting and then confirming the award as opposed to returning the award to the

arbitrator for modification or correction, citing Menahga Educ. Ass’n v. Menahga Indep.

Sch. Dist. No. 821, 568 N.W.2d 863, 868–69 (Minn. App. 1997), review denied (Minn.

Nov. 18, 1997).     Specifically, the Township contends that the district court’s legal

conclusion that the Township continued to be a member of the joint planning board and

was bound by the OAA and R-JPA went beyond the scope of the arbitration award that

the district court was confirming.

       The Township is correct that the arbitration award does not specifically state that

the Township remains bound by the OAA and the R-JPA.              But, in the award, the

arbitrator concludes that the settlement agreement is enforceable and that the Township

cannot be released from the OAA and the R-JPA without the approval of Northern

Township. That is, the arbitrator deemed the provision in the settlement agreement

releasing the Township to have no legal effect without Northern Township’s approval,

and therefore there is nothing in the settlement agreement that affirmatively releases the

Township from the OAA or the R-JPA. Under these circumstances, there was nothing

for the district court to interpret after the arbitrator concluded that this provision was

ineffectual until Northern Township gave its approval. The district court’s conclusion

that the Township therefore remains bound by the agreements is wholly consistent with

                                            8
the arbitration award’s construction of the settlement agreement.        Accordingly, the

district court’s March 20 order requiring the Township to obey the OAA and R-JPA is

within the scope of the award.

   B. Dismissal of the Action

       In its motion to confirm the arbitration award, the City requested dismissal of the

action in accordance with the award and the settlement agreement. The district court

agreed, finding that the Township was “obligated to dismiss the [c]omplaint” pursuant to

the settlement agreement and the arbitration award’s direction that the parties carry out

the terms of that agreement. The district court thereby dismissed all claims in the case

with prejudice. “We review a district court’s dismissal of a claim with prejudice under an

abuse of discretion standard.”     Minn. Humane Soc’y v. Minn. Federated Humane

Societies, 611 N.W.2d 587, 590 (Minn. App. 2000).

       The Township claims that the district court erred by dismissing the action after

confirming the arbitration award, and it primarily argues that dismissal is not required by

the terms of the arbitration award. This argument misconstrues both the arbitration award

and the settlement agreement. The settlement agreement provided:

              Each party’s attorney shall promptly file with all courts and
              agencies having jurisdiction, an executed copy of this
              [a]greement or otherwise cause all claims, charges and
              matters to be dismissed or withdrawn with prejudice, and
              each party shall execute and deliver in addition all other
              forms of separate written dismissal and withdrawal as may be
              required.

And, in the following paragraph, each party agreed to a complete release of “any and all

claims and causes of action of any kind or nature whatsoever . . . which may exist or

                                            9
might be claimed to exist, at, prior to or subsequent to the date hereof by reason of any

matter or thing arising out of or in connection with the claims in this mediation, and any

matter relating thereto.”     Consistent with these provisions in the agreement, the

arbitration award stated that “[b]oth the City and the Township are directed to cooperate

and as soon as practica[ble] to carry out all terms of the May 31, 2013 [settlement

agreement].” By the clear terms of these documents, the arbitration award contemplated

dismissal of the action in accordance with the settlement agreement.

       The Township also claims that the City waived any right to dismiss the action by

continuing to seek a temporary injunction after the arbitration award was issued.

“Minnesota favors arbitration as a means of conflict resolution, but the right to arbitration

may be waived.” Fedie v. Mid-Century Ins. Co., 631 N.W.2d 815, 819 (Minn. App.

2001), review denied (Minn. Oct. 16, 2001). Whether a party has waived its contractual

right to arbitration requires evidence that the party intended to relinquish this right and is

generally a question of fact subject to clear-error review. Id. Caselaw provides that a

party who chooses to commence and litigate a lawsuit waives the right to later demand

arbitration on the litigated issues. See, e.g., Anderson v. Twin City Rapid Transit Co.,

250 Minn. 167, 178–80, 84 N.W.2d 593, 601–02 (1957).

       But, the record here provides no indication that the City waived arbitration. The

City demanded arbitration, both parties participated in arbitration, and a resulting

arbitration award was issued. The parties’ cross-motions for injunctive relief were filed

while arbitration was still pending, and the MUAA explicitly provides that a motion

before the district court for provisional remedies that cannot be provided by the arbitrator

                                             10
“does not waive any right of arbitration.” Minn. Stat. § 572B.08(c) (2014). Given the

unique procedural history of this case, it would be illogical for us to conclude that the

City waived its right to enforce an arbitration award via action taken after the arbitration

process had already run its course.

       The Township also argues that, because of Northern Township’s failure to approve

its release from the OAA and the R-JPA, it received “incomplete . . . consideration” for

the settlement and the agreement was therefore unenforceable.          However, the plain

language of the agreement provides that the release of the Township from the OAA and

R-JPA was “[s]ubject to the approvals” of the City, the Township, and Northern

Township. The issue of whether Northern Township’s failure to approve the Township’s

release from the OAA and R-JPA would invalidate that provision or any other provision

of the agreement for lack of “complete consideration” was an issue for the arbitrator.

Because the Township failed to timely challenge the merits of the arbitration award, its

arguments are unpersuasive to the extent that it is seeking to relitigate the arbitrator’s

ruling that this provision was valid and enforceable as written. Even if this provision

were unenforceable because of a lack of complete consideration, the severance clause in

the agreement provides that, in such case, such result would not affect or impair the

remaining provisions of the agreement.

       The district court did not err by confirming the arbitration award and enforcing the

award by its dismissal of the Township’s action against the City and Northern Township.

                                            11
   C. Denial of the Motion to Amend

       The Township argues that the district court erred by refusing to allow it to amend

its complaint after the district court granted its motion for a temporary injunction and

joined Northern Township as a party. Because the City served its answer well before the

Township’s motion to amend and did not consent to the amended complaint, the

Township could only amend its complaint with leave of the court. See Minn. R. Civ. P.

15.01. “The district court should liberally grant motions to amend when justice requires

and doing so will not result in prejudice to the adverse party.” Ag Servs. of Am., Inc. v.

Schroeder, 693 N.W.2d 227, 235 (Minn. App. 2005). We will not reverse a district

court’s denial of a motion to amend “absent a clear abuse of discretion.” Johns v.

Harborage I, Ltd., 664 N.W.2d 291, 295 (Minn. 2003).

       The Township first claims that the district court failed to give a sufficient reason

explaining its denial of the motion to amend. The district court briefly explained its

rationale in refusing to allow the amendment in the memorandum accompanying its

March 20 order:

                      Instead of dismissing its complaint as ordered by the
              [a]rbitrator and requested by the City, the Township has
              doubled down by attempting to amend the [c]omplaint.
              Because I find that the Township was obligated to dismiss the
              [c]omplaint as of June 11, 2013, it follows that I cannot
              revive a case the parties agreed to dismiss by granting the
              Township’s motion to amend the [c]omplaint.

Thus, the district court gave a reason for its refusal to allow the amendment: the district

court would not allow the amendment of a complaint that the parties were obligated to

dismiss under the settlement agreement. The federal case cited by the Township, Foman

                                            12
v. Davis, specifically provides that futility of amendment, as well as bad faith and undue

prejudice to the opposing party, are reasons to disallow amendment under the federal

analogue to rule 15. See 371 U.S. 178, 182, 83 S. Ct. 227, 230 (1962). Minnesota

caselaw similarly provides that amendment of a complaint can be denied when it “would

serve no legal purpose” or would prejudice the opposing party.              Lumbermen’s

Underwriting Alliance v. Tifco, Inc., 465 N.W.2d 580, 584 (Minn. App. 1991), review

denied (Minn. Apr. 1, 1991). The parties’ settlement agreement required the dismissal of

all claims in the instant action, and moreover contained a complete, mutual release from

all asserted and unasserted claims. It would defy logic, and the settlement agreement, to

have allowed the Township to amend its complaint to add claims when it had already

agreed to dismissal of the suit.

       The Township next argues that the denial of its motion to amend is

“fundamentally irreconcilable” with the district court’s earlier decision to add Northern

Township as an indispensable party. “An indispensable party is one without whom the

action could not proceed in equity and good conscience.” Murray v. Harvey Hansen–

Lake Nokomis, 360 N.W.2d 658, 661 (Minn. App. 1985); see Minn. R. Civ. P. 19.01.

The first judge assigned to this case added Northern Township when it awarded a

temporary injunction in favor of the Township before any of the underlying issues raised

by the Township had been resolved by the district court. But, once the district court

confirmed the arbitration award, which had declared the settlement agreement to be

enforceable, the circumstances had changed. What initially involved unresolved claims

by the Township arising out of its settlement agreement with the City became a final

                                           13
resolution of those claims upon the district court’s confirmation of the arbitration award.

And, since the settlement agreement required the Township to dismiss the action in

district court, it necessarily required that the action also be dismissed against Northern

Township as well.

       The Township’s remaining arguments are unpersuasive. It argues that the denial

of its motion to amend prejudiced its separate lawsuit by facilitating later res judicata and

collateral estoppel defenses. However, “[a] judgment based on a settlement agreement is

a final judgment on the merits . . . with respect to those issues and claims actually

settled.” Goldberger v. Kaplan, Strangis & Kaplan, P.A., 534 N.W.2d 734, 736 n.1

(Minn. App. 1995), review denied (Minn. Sept. 28, 1995). The Township chose to settle

this lawsuit—it follows that it should then have to bear any preclusive consequences.

The Township also claims that the district court’s denial of its motion to amend led to the

injunction being dissolved for a lack of remaining claims. But, the Township agreed to

settle and dismiss their claims and, as explained below, this necessarily resulted in

dissolution of the temporary injunction.

   D. Dissolving the Temporary Injunction

       The Township next argues that the district court abused its discretion by sua

sponte dissolving the temporary injunction when the district court dismissed the action.

In its March 20 order, the district court vacated the temporary injunction originally

granted by the first judge as a “necessary corollary” to its dismissal of the action,

reasoning that the injunction would “disappear[]” as a matter of course with the lawsuit’s

dismissal and would further be “inconsistent” with the arbitration award.

                                             14
       “A temporary injunction is an extraordinary remedy,” and “[i]ts purpose is to

preserve the status quo until adjudication of the case on its merits.” Haley v. Forcelle,

669 N.W.2d 48, 55 (Minn. App. 2003) (quotations omitted), review denied (Minn. Nov.

25, 2003). “The grant of a temporary injunction does not establish the law of the case or

constitute an adjudication on the merits.” Id. “[C]ourts have the inherent power to

amend, modify, or vacate an injunction where the circumstances have changed and it is

just and equitable to do so.” Channel 10, Inc. v. Indep. Sch. Dist. No. 709, St. Louis

Cnty., 298 Minn. 306, 327–28, 215 N.W.2d 814, 829 (1974). We review the district

court’s ruling for an abuse of discretion. See Krueger v. Wash. Fed. Sav. Bank of

Montevideo, 406 N.W.2d 543, 546 (Minn. App. 1987).

       The Township’s various arguments regarding the district court’s dissolution of the

temporary injunction must fail in light of the fact that the district court was dismissing the

lawsuit, with prejudice, at the behest of the parties’ mediated settlement agreement. The

temporary injunction could not continue operating after the dismissal with prejudice of

the underlying suit. See Arnoldy v. Nw. State Bank, 142 Minn. 449, 451, 172 N.W. 699,

699 (1919) (“Necessarily, the injunction would fall when final judgment was entered.”).

Analogous federal law provides that a temporary injunction necessarily dissolves when

the case is dismissed and final judgment is entered. See U.S. Philips Corp. v. KBC Bank

N.V., 590 F.3d 1091, 1093 (9th Cir. 2010) (collecting cases); 11A Charles Alan Wright,

Arthur R. Miller & Mary Kay Kane, Federal Practice & Procedure § 2947 (3d ed. 2013)

(“A preliminary injunction remains in effect until a final judgment is rendered or the

complaint is dismissed . . . .”). We conclude that the district court did not abuse its

                                             15
discretion by dissolving the temporary injunction when it dismissed the underlying

lawsuit.

                                            II.

       The Township also challenges the district court’s June 2, 2014 order and resulting

order and judgment awarding attorney fees and costs and disbursements on two grounds.

    A. Enforcement of the March 20 Order and Attorney Fees

       After judgment was entered on the March 20 order, the City moved the district

court “to order the Township to take no action that is inconsistent” with the March 20

order and judgment, in light of the Township’s continued refusal to obey the OAA and

R-JPA and to cease conducting its own zoning and planning activities. The resulting

order of the district court indicated that it was granting the City’s motion for an order

“enforcing the March 20, 2014 [o]rder and [f]inal [j]udgment,” and further ordered that

the Township immediately cease all actions and activities related to its own zoning and

planning. The district court also granted the City’s motion for costs, disbursements, and

attorney fees.

       The Township raises two challenges2 to these district court actions, each of which

is ultimately unpersuasive. Building on its prior argument, the Township first argues that

this injunctive relief and attorney-fee award further impermissibly expands upon the

2
  The Township’s reply brief included additional arguments on this issue that were not
argued in its principal brief or raised in respondents’ briefs. These arguments have
therefore been forfeited and will not be considered here. Wood v. Diamonds Sports Bar
& Grill, Inc., 654 N.W.2d 704, 707 (Minn. App. 2002) (“If an argument is raised in a
reply brief but not raised in an appellant’s main brief, and it exceeds the scope of the
respondent’s brief, it is not properly before this court and may be stricken from the reply
brief.”), review denied (Minn. Feb. 26, 2003).

                                            16
arbitration award and fatally conflicts with the first judge’s earlier temporary injunction

in favor of the Township. These arguments are as equally unavailing here as they were

regarding the March 20 order. We can reject the Township’s request that we reverse the

attorney-fee award because the Township’s only assertion of error regarding that award is

that the district court’s “expan[sion]” of the arbitration award rendered the attorney-fee

award a “nullity.” As addressed supra, the March 20 order’s legal conclusion that the

Township was bound by the OAA and R-JPA was within the scope of the arbitration

award, and consequently the June 2 order was also within the scope of the award to the

extent that the district court granted relief based on the legal conclusion of its prior order.

And, any inconsistency between the June 2 order and the earlier temporary injunction is

irrelevant—that injunction was imposed before the arbitration award had been confirmed,

and it was finally dissolved by the March 20 order.

       The Township also claims that, in enjoining the Township from conducting certain

activities, the district court was required to analyze the temporary injunction factors in

Dahlberg Bros., Inc. v. Ford Motor Co., 272 Minn. 264, 274–75, 137 N.W.2d 314, 321–

22 (1965). Typically, we review a district court’s determination on a motion for an

injunction for an abuse of discretion, and “[t]he [district] court’s failure to make the

appropriate findings or conclusions of law constitutes error, requiring reversal and

remand.” Oxford Dev., Inc. v. Cnty. of Ramsey, 417 N.W.2d 319, 321 (Minn. App.

1988). But, we conclude that the district court was not required to address the Dahlberg

Bros. factors in its determination here. We construe the district court’s order as granting

permanent, not temporary, injunctive relief, and thus the district court had no reason to

                                              17
consider the temporary injunction factors. Rather, the district court was required to

consider the inadequacy of legal remedies and whether the injunction was “necessary to

prevent great and irreparable harm.” River Towers Ass’n v. McCarthy, 482 N.W.2d 800,

805 (Minn. App. 1992), review denied (Minn. May 21, 1992). “[I]rreparable harm may

be inferred from the breach of a contract between private parties,” id., and the only

adequate remedy to prevent the harm to the City of the Township’s continued refusal to

abide by its agreements appears to be the permanent injunctive relief ordered by the

district court. Based on this record, the findings of the district court, and the fact that the

Township does not challenge the merits of the permanent injunction on appeal, we

conclude that the district court did not err by ordering injunctive relief requested by the

City.

   B. Stay of Arbitration

        Two weeks after filing its appeal from the March 20 order and judgment, the

Township demanded additional arbitration with the City on two issues: (1) whether the

arbitration award adjudicated the merits of the already-dismissed prior court action; and

(2) whether the March 20 order bars claims brought by the Township against the City in

the separate lawsuit apart from those asserted by the Township in its initial complaint in

this case. The City moved to stay the arbitration demand. The district court granted an

arbitration stay in its June 2, 2014 order, but noted that the stay was partially dependent

on the outcome of the Township’s second, separate lawsuit against the City, Northern

Township, and the joint planning board.

                                              18
       The Township first argues that the district court lacked jurisdiction to stay

arbitration while its order and judgment were on appeal. While an appeal is pending, the

“[district] court’s authority to make any order that affects the order or judgment appealed

from” is suspended. Minn. R. Civ. App. P. 108.01, subd. 2. However, “the [district]

court retains jurisdiction as to matters independent of, supplemental to, or collateral to the

order or judgment appealed from.” Id.

       We conclude that the district court properly exercised jurisdiction over the City’s

motion for an arbitration stay, as its ruling on the issue of arbitrability did not affect the

March 20 order and judgment on appeal. Caselaw indicates that district courts cannot

amend an already-appealed order and judgment. See, e.g., Gummow v. Gummow, 356

N.W.2d 426, 428 (Minn. App. 1984) (holding that district court lacked jurisdiction to

enter post-appeal order amending judgment and decree).              Here, the order staying

arbitration did not affect the substance of the underlying order and judgment, as it simply

stayed a proceeding that was intrinsically collateral to the order and judgment on appeal.

Moreover, the Township’s arbitration demand sought an arbitrator’s ruling as to the

effect of the initial arbitration award, which by extension would affect the order and

judgment on appeal. Consequently, the district court would have risked running afoul of

rule 108.01 if it had not exercised its jurisdiction and stayed arbitration.3

3
  The Township also contends that the district court’s attorney-fee award violates rule
108.01, subd. 2. This argument is unavailing, as caselaw provides that attorney-fee
claims are “treated as a matter independent of the merits of the litigation.” Spaeth v. City
of Plymouth, 344 N.W.2d 815, 825 (Minn. 1984).

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       The Township also contends that the district court improperly applied the MUAA

by granting the arbitration stay, in light of the settlement agreement’s arbitration clause.

The statute provides that:

              On motion of a person alleging that an arbitration proceeding
              has been initiated or threatened but that there is no agreement
              to arbitrate, the court shall proceed summarily to decide the
              issue. If the court finds that there is an enforceable agreement
              to arbitrate, it shall order the parties to arbitrate. If the court
              finds that there is no enforceable agreement, it may not order
              the parties to arbitrate.

Minn. Stat. § 572B.07(b) (2014).        “In actions to stay arbitration, the limited issue

presented to the district court is the existence and scope of the arbitration agreement.”

Indep. Sch. Dist. No. 775 v. Holm Bros. Plumbing & Heating, Inc., 660 N.W.2d 146, 149

(Minn. App. 2003). “The court shall decide whether an agreement to arbitrate exists or a

controversy is subject to an agreement to arbitrate . . . .” Minn. Stat. § 572B.06(b)

(2014). We conduct an independent interpretation of the arbitration agreement. Heyer v.

Moldenhauer, 538 N.W.2d 714, 716 (Minn. App. 1995).

       The settlement agreement provides that “[a]ny dispute(s) and/or questions of any

kind or nature regarding this [s]ettlement shall be decided by [b]inding [a]rbitration.”

(Emphasis added.) Both of the Township’s claims in its arbitration demand fell outside

the scope of this arbitration clause. The Township sought to have the arbitrator not only

review the merits of its own arbitration award and the district court’s March 20 order, but

to also issue a “threshold determination” as to the preclusive effects that the March 20

district court order would have in the separate district court action. But, the arbitration

clause does not provide that the parties can pursue arbitration in order to relitigate the

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arbitrator’s prior award or the actions of the district court pursuant to that award. Instead,

if the Township desired review of either the arbitration award or the March 20 district

court order, it had clear avenues to obtain such review: a vacation, modification, or

correction motion within the statutory time limit for the arbitration award, and an appeal

to this court relative to the district court order. The Township failed to pursue a vacation,

modification or correction motion within the statutory time limit, and was already

pursuing an appeal of the district court order confirming the arbitration award.           As

recognized above, the district court correctly recognized that allowing arbitration to

proceed would have undermined this court’s authority on appeal.

       The Township lastly argues that the district court lacked jurisdiction to stay

arbitration on the second claim in its arbitration demand, the effect of the arbitration

award on the Township’s claims in its separate lawsuit, because the current district court

judge in this case had been assigned to, and then removed from, the separate lawsuit.

The Township argues that the district court ignored the notice of removal and exercised

jurisdiction in the separate suit by issuing the stay in this case.

       This argument is wholly without merit. The only authority cited by the Township

in support of this argument is a case holding that the judge in a prior action can be

removed under Minn. R. Civ. P. 63.03 in a subsequent action involving similar parties

and claims. See Omaha Fin. Life Ins. Co. v. Continental Life Underwriters, Ins. Co., 427

N.W.2d 290, 291–92 (Minn. App. 1988), review denied (Minn. Oct. 26, 1988). There is

no indication here that the district court judge refused to honor the Township’s removal

motion, as he was removed in the separate suit. The district court’s order in this case

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consciously refrains from invading the jurisdiction of the district court in the separate

lawsuit. Instead of deciding the arbitrability issue itself, the district court shifted the

resolution of arbitrability and other accompanying issues onto the decisionmaker who

had the Township’s new claims before it in a separate lawsuit.

      Affirmed.

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