Opinion
No. C9-96-903.
Filed October 22, 1996.
Appeal from the District Court, Goodhue County, File No. C795703.
Harry T. Neimeyer, (for appellant)
Barbara M. McLaughlin, (for respondent Helen A. Lee)
Timothy K. Dillon, (for respondent Robert W. Lee)
Considered and decided by Short, Presiding Judge, Parker, Judge, and Crippen, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1994).
UNPUBLISHED OPINION
Maria Lee brought this action against her former spouse and his mother to invalidate a $180,000 marital debt for lack of consideration. Following a bench trial, the trial court concluded the promissory note and agreement executed by Lee's former spouse and his mother were supported by fair consideration, and entered judgment for Lee's former spouse and his mother. On appeal, Lee argues the documents are not the result of reciprocal bargaining, but represent a device to transfer assets during a marriage dissolution proceeding. We affirm.
DECISION
The findings of a district court sitting without a jury will not be set aside unless clearly erroneous. Minn.R.Civ.P. 52.01. A finding is clearly erroneous if it is without substantial evidentiary support or induced by an erroneous view of the law. Reserve Mining v. State , 310 N.W.2d 487, 490 (Minn. 1981). On appeal, we examine the record in the light most favorable to the trial court's decision, and give deference to the trial court's opportunity to judge witness credibility. Minn.R.Civ.P. 52.01; see Jadwin v. Kasal , 318 N.W.2d 844, 847 (Minn. 1982) (viewing evidence in light most favorable to trial court findings); Roy Matson Truck Lines v. Michelin Tire Corp. , 277 N.W.2d 361, 362 (Minn. 1979) (noting the trial court, when sitting without a jury, is the sole judge of witness credibility and may accept all or only part of a witness' testimony).
It is elementary that a contractual promise must be the product of a bargained-for exchange. 1 Arthur L. Corbin, Corbin on Contracts § 1.10, at 27 (Joseph M. Perillo ed., rev. ed. 1993); Cederstrand v. Lutheran Brotherhood , 263 Minn. 520, 530, 117 N.W.2d 213, 220 (1962). While a contract must be supported by fair consideration, a court will not examine the adequacy of consideration as long as something of value has passed between the parties. See Baehr v. Penn-O-Tex Oil , 258 Minn. 533, 538-39, 104 N.W.2d 661, 665 (1960) (requiring exchange, although not of equivalent value, to support contractual promise); Ketterer v. Independent School Dist. No. 1 , 248 Minn. 212, 223-24, 79 N.W.2d 428, 436-37 (1956) (placing substantial value on structural improvements to property, therefore declining to address adequacy of one dollar nominal consideration); Chalmers v. Kanawyer , 544 N.W.2d 795, 798 (Minn.App. 1996) (declining to judge adequacy of consideration where party to contract suffered some legal detriment); Gunhus v. Engelstad , 413 N.W.2d 148, 153 (Minn.App. 1987) (refusing to determine whether consideration was so unfair as to hold lease unconscionable where parties exchanged something of value), review denied (Minn. Nov. 24, 1987) (citing Estrada v. Hanson , 215 Minn. 353, 356, 10 N.W.2d 223, 225-26 (1943)).
Lee admits her former mother-in-law made cash advances to the couple. However, Lee argues the trial court's finding of "fair consideration" was erroneous because: (1) her former mother-in-law intended the cash as "gifts;" and (2) her former spouse's decision to purchase his mother's 60 percent interest in Lee Chevrolet made no economic sense. By contrast, the trial court found: (1) Lee's former mother-in-law loaned her son $95,200, plus $20,000 in interest payments to keep the family's Chevrolet dealership business from failing; (2) Lee's former spouse purchased his mother's interest in Lee Chevrolet, thereby obtaining full ownership of the business; (3) this acquisition was prompted by General Motors Corporation's requirements for dealership; and (4) Lee's former mother-in-law expected repayment from the couple. Although there was conflicting evidence at trial, the court's findings are amply supported by testimony from Lee's former spouse and the bookkeeper at Lee Chevrolet, and by deposition testimony of Lee's former mother-in-law. Given the substantial record support for the trial court's finding that the debt was based on "fair consideration," the trial court's decision is not clearly erroneous.