John and Lori Finstad granted ransom-sargent water Users an option to purchase t
ID: 350138 • Letter: J
Question
John and Lori Finstad granted ransom-sargent water Users an option to purchase their farmland and drill water wells. The option also permitted the Finstad’s to lease the property for up to ten years, provided they only use the land for pasture purposes. Four years later, ransom-sargent terminated the Finstad’s lease rights, because the Finstad’s had tilled up some of the land. in order to continue receiving government farm payments, the Finstad’s signed a new contract with ransom-sargent per- mitting the Finstad’s to lease the land for one year and to collect government payments for that year. By signing the contract, they also avoided a lawsuit with ransom-sargent. The contract included a release of all rights the Finstad’s had to lease the property under the original option agreement. The following year, ransom-sargent accepted bids to lease the land. after they were not awarded the lease, the Finstad’s sued ramson-sargent, alleging that their second contract was not supported by consideration and that their original option to lease should be upheld. were they correct?
Explanation / Answer
We reverse and remand for further proceedings.32–12.1–10 to the Finstads' contract claims, and genuine issues of material fact existed to preclude summary judgment. We conclude the district court erred in applying the three-year statute of limitations of N.D.C.C. §John and Lori Finstad appealed from a district court judgment which granted summary judgment in favor of Ransom–Sargent Water Users, Inc., n/k/a Southeast Water Users District, and its board members (collectively, “Water District”), and dismissed their complaint.
The Finstads owned 80 acres of a section of land in Ransom County and leased 240 adjacent acres in the same section from Willis and Doris Olson. The District was considering this tract of land as a potential site to drill water wells. In 1997, the Finstads and the Olsons granted to the District options to purchase the land. The options also allowed the Finstads and the Olsons to lease back the property for five years, after which they had a non assignable right of first refusal to lease back the property for an additional five years. The option provided:
"Seller may lease the property back from Buyer for five years after the option is exercised at the rate of $10.00 per acre, payable in advance each year. Seller shall thereafter have a non assignable right of first refusa1 in regard to the succeeding five year rental period
After the lease was terminated, John Finstad told the District that to maintain government Freedom to Farm, or Production Flexibility Contract ("PFC"), payments on the property, a current lease must be in place or the payments would be lost for 2001 and thereafter. As a political subdivision, the District was not eligible to receive the payments so a rental agreement needed to be executed. Ultimately, the District's attorney prepared two agreements. The first was a "Farm Rental Contract-Cash Rent" purporting to allow John Finstad to farm the property during 2001 for $1,441. The parties admit this was an artifice to allow John Finstad to receive the PFC payments. The farm rental contract stated it was "subject to a separate Agreement and Release signed concurrently herewith," which was the second agreement involved in the transaction. The "Agreement and Release" provided in part:
28–01–15(2) applies to their claims because theirs is an action upon a contract contained in an instrument affecting the title to real property. The Finstads contend the ten-year statute of limitations of N.D.C.C. §32–12.1–10 to their claims because that section only applies to tort claims against political subdivisions. The Finstads argue the district court erred in applying the three-year statute of limitations of N.D.C.C.
.1.As of the date hereof, their membership in Ransom-Sargent Water Users District shall be paid in full.
2. Releasors hereby release and discharge all rights they have to the [Finstads' former property] by reason of an Option to Purchase Real Property dated November 14, 1997, including all lease back rights and rights of first refusal contained therein.
3. Releasors hereby release and discharge all rights they have to the [Olsons' former property] by reason of an Assignment dated May 25, 2001 and signed by Willis L. Olson and Doris E. Olson.
4. Releasors specifically agree to remove all personal property owned by them which is now located on the [subject property] as soon as possible; provided, however, that they shall first contact Joel Heitkamp to advise him of the time for removal of said property.
5. Notwithstanding the Cash Rent Contract signed concurrently herewith, Releasors specifically agree that they will not enter upon any part of the [subject property] for any reason, from and after the date hereof, without the express permission of Joel Heitkamp
If a statute is ambiguous, we may consider the following in determining the legislature's intent:1–02–27. N.D.C.C. §Dimond v. State ex rel. State Bd. of Higher Educ., 2001 ND 208, ¶8, 637 N.W.2d 692. “If the provisions of any chapter or title conflict with or contravene the provisions of any other chapter or title, the provisions of each chapter or title must prevail as to all matters in question arising thereunder out of the same subject matter.”
The object sought to be attained.1.
The circumstances under which the statute was enacted.2.
The legislative history.3.
The common law or former statutory provisions, including laws upon the same or similar subjects.4.
The consequences of a particular construction.5.
The administrative construction of the statute.6.
The preamble.7.
Although the lack of citation to a controlling statute does not entitle this Court to ignore that statute, I am not prepared, without briefing and argument, to so quickly conclude the Legislature has preempted the field in this instance. Whether or not the definition of duress, which on its face is limited to physical confinement of persons or unlawful detention of property, is the only form of duress that the Legislature has or allows to be recognized is an open question which I would not answer under the facts of this case.
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