Opinion
No. CX-97-1150.
Filed December 30, 1997.
Appeal from the District Court, Hennepin County, File No. 9520314.
Galen E. Watje, Steven Moore, (for Respondent).
Scott J. Otero-Strouts, (for Appellant).
Considered and decided by Lansing, Presiding Judge, Davies, Judge, and Willis, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
Appellant Irwin Ketroser challenges the district court's grant of summary judgment against him, arguing that he has demonstrated the existence of a genuine issue of material fact. We affirm.
FACTS
In September 1991, appellant Irwin Ketroser hired respondent Concord Development Co. as his real estate agent to help him sell an apartment complex in Brooklyn Center. Concord first located Nazir A. Moghul as a buyer. Moghul and Ketroser entered into a contract for deed in January 1992, which Ketroser cancelled two months later due to Moghul's inability to manage the property.
Shortly afterward, Concord located Lenard J. Braun, who agreed to buy the property for $350,000. Braun and Ketroser entered into a contract for deed on May 4, 1992, which provided that Braun would pay Ketroser half of the monthly rent receipts, plus interest and additional cash, but with no down payment. Following the same procedure as in the previous transaction, Ketroser executed a promissory note in favor of Concord for a sales commission, in this case for $17,500, payable in monthly installments of $500. The note contained an acceleration clause providing that the full amount became due upon failure to make a payment.
The parties' accounts differ sharply as to what followed. Ketroser alleges that Braun failed to make payments under the contract, failed to pay utilities and insurance, and admitted to Ketroser that he lacked the capital to make necessary improvements to the building. Braun, in an affidavit, denied all Ketroser's allegations regarding his performance and stated that Ketroser had informed him before the sale that the city of Brooklyn Center was interested in buying the building. Two Concord agents, in affidavits, state that they met with Ketroser sometime in 1992 regarding his failure to make payments on the promissory note and that Ketroser said he had not paid because of financial difficulties related to his divorce. Both parties agree that in January 1993, Braun executed a quitclaim deed returning title to Ketroser, who sold the building to the city for an undisclosed price.
Braun alleges in his affidavit that the city bought the property for approximately $350,000, the same price Braun had paid. No other figure appears in the record.
In June 1994, Concord brought the instant breach of contract action seeking payment of the $17,500 sales commission, plus interest. Ketroser raised a defense of fraud in the inducement, alleging that Concord's agents had misrepresented to Ketroser that Braun possessed both experience in operating apartment complexes and the capital to make the improvements necessary to bring certain vacant apartments to marketable condition and that they knew or should have known that Braun in fact had neither the experience nor the capital. Ketroser also raised defenses of failure of consideration, frustration of purpose, unconscionability, and unjust enrichment, and he counterclaimed for damages.
In September 1995, Ketroser claimed in a deposition to have records documenting the terms of his sale to the city and Braun's failure to fulfill his obligations under the contract for deed, and he told Concord's attorney that he would produce them. When Ketroser failed to turn over any documents, Concord served a request for production of documents, followed by a motion to compel discovery, on which the district court apparently never ruled.
In September 1996, Concord moved for summary judgment. Court-ordered arbitration did not resolve the dispute. The court then granted summary judgment, based on Ketroser's failure to produce any support for his defenses other than his own assertions. The court also awarded costs and attorney fees to Concord. Ketroser appeals, and we affirm.
DECISION
Concord argues on appeal that Ketroser waived his defense of fraud and failed to plead the defense with particularity. Concord did not argue either of these issues in the district court and therefore may not raise them on appeal. See Thiele v. Stich , 425 N.W.2d 580, 582 (Minn. 1988). The sole remaining issue is whether Ketroser has presented sufficient evidence of the existence of a genuine issue of material fact for trial. Because all of Ketroser's affirmative defenses and counterclaims rely on the same basic allegation, that Braun was an unqualified buyer, the same analysis applies to all of Ketroser's arguments.
On an appeal from a grant of summary judgment, this court inquires (1) whether there are any genuine issues of material fact and (2) whether the district court erred in its interpretation of the law. State by Cooper v. French , 460 N.W.2d 2, 4 (Minn. 1990). This court must view the evidence in the light most favorable to the party against whom judgment was granted. Fabio v. Bellomo , 504 N.W.2d 758, 761 (Minn. 1993). Courts should resolve any doubt as to whether there is a genuine issue of material fact in favor of finding that a fact issue exists. Harvet v. Unity Medical Ctr., Inc. , 428 N.W.2d 574, 578 (Minn.App. 1988).
Minnesota courts have emphasized that summary judgment is a "blunt instrument" that should be employed "only where it is perfectly clear that no issue of fact is involved * * *." Id. (quoting Donnay v. Boulware , 275 Minn. 37, 45, 144 N.W.2d 711, 716 (1966)). However, Minn.R.Civ.P. 56.05 states that [w]hen a motion for summary judgment is made and supported * * * , an adverse party may not rest upon the mere averments or denials of the adverse party's pleading but must present specific facts showing that there is a genuine issue for trial.
This has been interpreted to require the nonmoving party to submit specific facts, admissible in evidence, tending to prove each element of the party's claim. See, e.g., Kletschka v. Abbott-Northwestern Hosp., Inc. , 417 N.W.2d 752, 754 (Minn.App. 1988) (upholding summary judgment for defendant in reprisal discrimination case because plaintiff failed to allege specific facts indicating pretext), review denied (Minn. Mar. 30, 1988). The non-moving party may not rely on assertions in his pleading or on claims that the factual dispute will be developed at the time of trial. Borom v. City of St. Paul , 289 Minn. 371, 374-75, 184 N.W.2d 595, 597 (1971).
Minnesota courts have not been entirely consistent in their treatment of summary judgment motions in which the record consists entirely of competing affidavits. Compare Brenner v. Nordby , 306 N.W.2d 126, 126-27 (Minn. 1981) (concluding that competing affidavits created genuine issue of material fact) and Singh v. State Farm Mut. Auto. Ins. Co. , 523 N.W.2d 348, 350 (Minn.App. 1994) (holding that court may not simply accept as true testimony of interested witness where that testimony is challenged by non-moving party) with Bixler by Bixler v. J.C. Penney Co. , 376 N.W.2d 209, 216 (Minn. 1985) (stating that non-moving party must demonstrate that moving party's affiant could be impeached or might have other testimony valuable to opponent). The district court here relied on Havemeier v. Karlstad Equip. Farms , 406 N.W.2d 581, 583 (Minn.App. 1987), review denied (Minn. July 22, 1987), in which this court held that the plaintiff's allegation that the wife of one of the defendant partners "appeared" to act as a partner herself was insufficient to call into doubt the wife's unequivocal assertion in her affidavit that she was in fact not a partner. We find Havemeier distinguishable in that Ketroser asserts personal knowledge of Braun's failure to fulfill the contract. Ketroser in turn relies primarily on Kasson State Bank v. Haugen , 410 N.W.2d 392, 394-95 (Minn.App. 1987), in which this court reversed a grant of summary judgment where the pro se defendant had sent a letter alleging fraudulent inducement to the plaintiff bank in lieu of an answer to the complaint and testified consistently at the summary judgment hearing. Kasson, however, is unusual procedurally in that the district court heard testimony at the summary judgment hearing, and this court gave consideration to the non-attorney defendant's pro se status. See id.
We believe some of the apparent inconsistency in case law is explained by the logical availability of other forms of evidence. In Boulevard Del, Inc. v. Stillman , 343 N.W.2d 50, 52-53 (Minn.App. 1984), this court affirmed a grant of summary judgment where the defendant conducted no discovery and rested on his attorney's affidavit asserting that on "information and belief" the plaintiff had failed to fulfill certain contract obligations, although the record showed that the defendant knew who had personal knowledge of facts that might create triable issues. While this portion of the opinion is dictum, its logic is consistent with the fact that summary judgment functions procedurally as a review of the entire pretrial record to determine whether sufficient evidence exists to proceed to trial and is consistent with the general rule that the non-moving party may not rely on promises to produce evidence at trial. See Borom , 289 Minn. at 374-75, 184 N.W.2d at 597.
In general, the cases in which affidavits alone have been held sufficient to preclude summary judgment have been those in which the nature of the dispute made it unlikely that other evidence could exist. See, e.g., Brenner , 306 N.W.2d at 127 (dispute involving whether defendant represented to plaintiff that it was investigating matter); Howie v. Thomas , 514 N.W.2d 822, 825 (Minn.App. 1994) (dispute as to whether putative father engaged in intercourse with mother); Granell v. Veterans of Foreign Wars Milton Barber Post No. 3871 , 357 N.W.2d 431, 432 (Minn.App. 1984) (dispute as to whether employees had falsified records of hours worked). Here, by contrast, Ketroser repeatedly stated in his deposition that documentary evidence in support of his claim exists, but after failing to respond to two discovery requests, in response to the summary judgment motion he supplied only an affidavit that essentially restated the allegations in his complaint, with no explanation for his failure to produce any additional evidence and no request for a continuance.
Minnesota's summary judgment rules are designed to enable the court to determine the need for trial on the most complete record possible. See, e.g., Minn.R.Civ.P. 56.03 (providing strict ten-day notice requirement for summary judgment motions); Minn.R.Civ.P. 56.06 (permitting court to grant continuance or deny summary judgment motion where party provides reason why evidence cannot be produced). When the non-moving party frustrates this effort by failing to produce evidence that he claims to exist, despite the general rule that all inferences are to be made in favor of the non-moving party we find it proper for the court to infer that the evidence does not in fact exist. Cf. Minn.R.Civ.P. 37.02(b)(3) (permitting court to dismiss action as sanction for failure to comply with discovery order).
If Braun in fact did not make payments, in the absence of a contrary explanation any reasonable finder of fact would expect that records documenting Braun's default would exist and would be in Ketroser's possession. Here, Ketroser's affidavit and deposition testimony provide a scintilla of evidence, but more is required to establish a genuine issue of material fact. See DLH, Inc. v. Russ , 566 N.W.2d 60, 71 (Minn. 1997). We concur with the district court's conclusion that Ketroser failed to carry his burden of producing evidence tending to prove the existence of a genuine issue of material fact sufficient to preclude summary judgment.