Opinion
No. CX-97-161.
Filed July 22, 1997.
Appeal from the District Court, Ramsey County, File No. C3-95-4172.
D. Clay Taylor, A. Richard Bailey, (for Appellant)
William M. Hart, Kenneth W. Dodge, Thomas E. Propson, (for Respondents Sonitrol Management Corp.)
Morgan Allen Godfrey, (for Respondents On Security Systems)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
On January 29, 1994, an arsonist vandalized the Sportmart store in Roseville. Appellant Sportmart, Inc. sustained approximately $2.4 million dollars in damages in the fire, submitted a claim to its insurer, and was compensated.
In April 1995, appellant brought this action against the arsonist, defendant John Chi Hargesheimer, and the corporate entities with whom appellant had contracted to design, install, service, and monitor an in-store security system at its Roseville store, respondents On Security Systems, Inc., d/b/a Sonitrol Chicagoland North, Sonitrol Management Corp., f/k/a Sonitrol of the Twin Cities, Inc., and Sonitrol Corp. The complaint alleges negligence; gross negligence; wilful, wanton, and intentional acts; misrepresentations; and violations of the Minnesota Unfair Trade Practices and Consumer Fraud Acts.
Respondent Sonitrol Management Corp. is the successor in interest to Sonitrol Twin Cities, the firm that actually installed and monitored the system in appellant's Roseville store. Respondent On Security Systems made the sales presentation to appellant, and respondent Sonitrol Corporation is On Security's franchisor. While these three respondents are distinct corporate entities, for purposes of this appeal they are treated as one.
The district court granted respondent's summary judgment motion, concluding that the action was time-barred because not brought within one year of the fire as required by the parties' contract and that rescission of the contract was unwarranted by the facts. We agree and affirm.
DECISION I.
Appellant argues that the grant of summary judgment was premature because it was based on an "incomplete record" containing only "written discovery documents" and no oral discovery. In the eight months between respondents' first notice of its summary judgment motion and the hearing on that motion, however, appellant seemingly made no attempt to take any depositions or gather any "oral" discovery. Nor did appellant request a continuance "to permit affidavits to be obtained or depositions to be taken or discovery to be had." Minn.R.Civ.P. 56.06. Appellant has not shown that, despite its diligence, it has been unable to obtain crucial discovery and that it needs more time. See Schluter v. United Farmers Elevator , 479 N.W.2d 82, 86 (Minn.App. 1991) (diligent showing required of party seeking continuance for additional discovery), review denied (Minn. Feb. 27, 1992). In addition, the alleged fraudulent misrepresentations were made to appellant's own employees, who have submitted affidavits outlining the representations. Because appellant's allegations regarding those representations are taken as true for the purposes of this summary judgment motion, deposition testimony to deny or explain those representations was not necessary. See Port Authority v. Harstad , 531 N.W.2d 496, 501 (Minn.App. 1995) (motion for continuance properly denied when additional discovery would not have changed result), review denied (Minn. June 14, 1995).
Finally, summary judgment was not per se inappropriate just because appellant alleged fraud: appellant still had the burden to plead its fraud claim with particularity and to establish a prima facie case of fraud. See Minn.R.Civ.P. 9.02 (fraud must be pled with particularity); Minn.R.Civ.P. 56.05 (party opposing summary judgment "must present specific facts showing that there is a genuine issue for trial"); Goward v. City of Minneapolis , 456 N.W.2d 460, 464 (Minn.App. 1990) (even at summary judgment stage, party must produce evidence of all material facts for which it bears burden of proof at trial). Thus, the district court did not err in granting respondents' summary judgment motion based on the record before it.
II.
Appellant alleged that during the parties' contract negotiations, one of respondents' salespersons told appellant that:
1. The system was the most accurate, sophisticated, highly sensitive and comprehensive security system available.
2. The system would be able to monitor and detect, prior to actual entry, the unauthorized entry into appellant's facility, and its monitoring operators were highly trained to be able to recognize and discriminate various sounds, including voice, glass breaking and cutting sounds, and would promptly notify the appropriate authorities.
3. The system would fully protect appellant's Roseville premises from hazards of burglary, vandalism, and fire.
4. The system would provide complete security protection, including the detection of audible noises prior to the entry of unauthorized intruders.
5. Glass breakage and/or door openings would be immediately detected and reported to the police by the system operators.
Appellant claims that it awarded respondents the contract based on these representations.
Even when the evidence is viewed in a light most favorable to appellant, respondents' alleged representations fail to support a prima facie claim for intentional misrepresentation or fraud in the inducement. The statements regarding the accuracy, comprehensiveness, or sophistication of the security system involve "puffery" or concern the future performance of the security system and its monitors. As such, these statements cannot support a claim of fraud. See, e.g., Rognlien v. Carter , 443 N.W.2d 217, 220-21 (Minn.App. 1989) (statements about future events cannot support action for fraud merely because represented act did not take place), review denied (Minn. Sept. 21, 1989); American Computer Trust Leasing v. Jack Farrell Implement Co. , 763 F. Supp. 1473, 1487 (D.Minn. 1991) ("A wide variety of statements ordinarily used in sales negotiations are not actionable as fraud. These include ordinary sales puffing, statements of opinion, and promises of future performance.") (citations omitted), aff'd , 967 F.2d 1208 (8th Cir. 1992), cert. denied , 506 U.S. 956 (1992). The statements regarding the training received by respondents' personnel are true and thus not actionable: the record shows that the operator on duty at the time of the break-in was trained to recognize hostile sounds, operate the equipment, and respond to alarms. Finally, the statements regarding what the system "would detect" and what the operators "would do" concern future performance and are not actionable. See Wojtkowski v. Peterson , 234 Minn. 63, 69, 47 N.W.2d 455, 458 (1951) (fraud claim cannot be predicated on mere promise or intention to perform unless shown that promissor did not intend to perform); Rognlien , 443 N.W.2d at 220-21. Because none of the representations allegedly made by respondents constitutes actionable fraud, the contract is enforceable and not subject to rescission.
Appellant insists that rescission is equitable relief, which is available to it under the Unlawful Trade Practices and Consumer Fraud Acts. Appellant thus argues that it need only prove that respondents violated the Acts by making negligent, as opposed to fraudulent, misrepresentations. A statute does not replace common law principles unless the statute expressly and clearly so states. See In re Estate of Kroyer , 385 N.W.2d 31, 33 (Minn.App. 1986). The only express reference to rescission in these Acts is found in a section of the Consumer Fraud Act allowing rescission as a remedy to victims of referral and chain selling. See Minn. Stat. § 325F.69, subd. 2 (1994). These Acts do not enlarge a party's right to rescind a contract beyond the limits established by common law. Because common law principles apply, rescission of this contract is not available except upon proof of fraudulent misrepresentation. See Carstedt v. Grindeland , 306 N.W.2d 105, 110 (Minn. 1981).
III.
Appellant argues that the district court erred in finding that the one-year suit limitation period of the contract was enforceable and in dismissing all of appellant's claims against respondents. Appellant insists that because the complaint included claims under the Consumer Fraud and Unlawful Trade Practices Acts, Minn. Stat. §§ 325D.09 — .16, 325F.68 — .70 (1994), the district court wrongly allowed the contract's shorter limitation provision to supersede Minnesota statutes.
Whether parties to a contract may validly shorten a statutorily prescribed limitation period involves a two-step analysis. The first inquiry is whether a specific statute prohibits the use of a different limitation period; if no such statute exists, the contract limitation will be upheld if reasonable in length. See Henning Nelson Constr. Co. v. Firemen's Fund. Am. Life Ins. Co. , 383 N.W.2d 645, 651 (Minn. 1986).
In this case, the provisions of the two Acts are silent on any applicable statute of limitations. Rather, appellant's claims under both Acts are governed by the six-year general statute of limitations provision set out in Minn. Stat. § 541.05, subd. 1(2) (1992). The legislature has not specifically prohibited parties from contracting for a shorter limitations period within which to bring these types of claims, as it has in at least one other statutory scheme. See, e.g., Minn. Stat. § 61A.07(2) (1994) (life insurance policies prohibited from containing provision limiting time for initiating any action to "less than five years after the cause of action shall accrue"). Nor has the legislature included a specific limitations period within either Act, as it has in other statutory schemes. See, e.g., Minn. Stat. § 176.151 (Workers' Compensation Act); § 325C.06 (Uniform Trade Secrets Act); § 325F.6658 (Farm Equipment Warranty Compliance); § 336.2-725 (contract for sale of goods under Uniform Commercial Code). Thus, no specific statute prohibited the parties in this case from contracting for a shorter period within which to bring claims.
Because appellant has not claimed or argued that the limitations period provided in the contract is unreasonable, this issue is waived and we need not address the second step of the analysis. See L H Transport, Inc. v. Drew Ag., Inc. , 403 N.W.2d 223, 226 (Minn. 1987). Thus, the district court did not err in concluding that the one-year contractual limitations period was enforceable. And that provision, which applied to all "claims, actions, or proceedings, legal or equitable," is broad enough to encompass all of appellant's claims, including its claim of fraudulent inducement. Cf. Michael-Curry Co. v. Knutson Shareholders Liquidating Trust , 449 N.W.2d 139, 141-42 (Minn. 1989) (arbitration clause enforceable and not automatically vitiated by claim of fraudulent inducement where clause specifically shows parties intended to arbitrate fraud or clause sufficiently broad to comprehend that issue of fraud was to be arbitrated); Atcas v. Credit Clearing Corp. , 292 Minn. 334, 348, 197 N.W.2d 448, 456 (1972) (same).
The district court's grant of summary judgment to respondents is affirmed.