Junk Brothers Land and Cattle v. Buchanan County, Iowa ( 2020 )

IN THE COURT OF APPEALS OF IOWA
No. 19-2084
Filed September 2, 2020
JUNK BROTHERS LAND AND CATTLE,
Plaintiff-Appellant,
vs.
BUCHANAN COUNTY, IOWA,
Defendant-Appellee.
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Appeal from the Iowa District Court for Buchanan County, Bradley J. Harris,
Judge.
Junk Brothers Land and Cattle appeals the district court ruling dismissing
its petition for breach of contract and entering judgment on Buchanan County’s
counterclaim for breach of contract regarding a lease to pasture land entered by
the parties. AFFIRMED.
James T. Peters and R.J. Longmuir of Peters & Longmuir, PLC,
Independence, for appellant.
Daniel G. Clouse, Independence, for appellee.
Considered by Vaitheswaran, P.J., and Mullins and Ahlers, JJ.
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AHLERS, Judge.
The basic facts of this case are fairly straightforward. In 2014, Junk
Brothers Land and Cattle1 (Junk Brothers) and Buchanan County, Iowa, signed a
three-year written lease whereby Junk Brothers rented a pasture owned by the
county. Junk Brothers made the first yearly rental payment on March 1, 2015, and
entered the property for the first time that day. According to Junk Brothers, it then
discovered the pasture fencing not visible from the road had deteriorated to the
point that some of the fencing was buried in the ground. In addition, gates in the
corral area of the pasture had been removed. Junk Brothers informed the county
that repairs were needed to the fencing, and the county agreed to make them.
However, in July 2015, before the county could make the repairs, Junk Brothers
refused to honor the lease because it was unable to keep cattle in the pasture as
it intended. In response, the county again solicited bids to rent the property after
new fencing was installed in August 2015, and the county eventually accepted a
new bid at a lower rate than Junk Brothers had agreed to pay.
Junk Brothers filed a petition alleging it and the county had entered a written
contract in the form of the lease and the county had breached the contract. The
county filed an answer in which it admitted the lease was a valid contract between
it and Junk Brothers and also filed a counterclaim seeking damages from Junk
Brothers for breach of contract. Following a bench trial, the district court found
Junk Brothers had failed to show the county had breached the lease and also found
Junk Brothers had breached the lease by terminating it early. The district court
1 Junk Brothers Land and Cattle is a partnership consisting of two partners with
the last name Junk.
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awarded the county damages calculated by taking the total amount Junk Brothers
owed under the lease, subtracting the amount Junk Brothers paid, and subtracting
the amount the replacement tenant owed for the remainder of the original lease
term. Junk Brothers appeals.
The parties maintain that our review of this case is de novo, which is
appropriate for equity cases. Iowa R. App. P. 6.907. However, we disagree that
this is an equity case rather than an action at law.2 “Generally, an action on
contract is treated as one at law.” Van Sloun v. Agans Brothers, Inc., 778 N.W.2d
174, 178–79 (quoting Atlantic Veneer Corp. v. Sears, 232 N.W.2d 499, 502 (Iowa
1975)). In actions based on nonperformance of a contract where the remedy
sought is monetary damages, the action is at law. Id. Both Junk Brothers’s claim
and the county’s counterclaim are based on breach of contract, and the only
remedy sought by either party was money damages. Therefore, we conclude this
is a law action. “The standard of review for a breach of contract action is for
correction of errors at law.” Iowa Mortg. Ctr., L.L.C. v. Baccam, 841 N.W.2d 107,
2 While we note this case was given an equity case number at the district court,
and the district court’s ruling referred to the parties as petitioner and respondent
(nomenclature typically used in equity cases) rather than plaintiff and defendant
(nomenclature typically used in law actions), we suspect this came about because
of an apparent error in the petition. In the caption of the petition, Junk Brothers
was referred to as “petitioner” while the county was referred to as “defendant,” an
incongruity that was compounded by Junk Brothers being referred to as “plaintiff”
throughout the body of the petition. We suspect Junk Brothers was referenced as
“petitioner” in the caption of the petition by mistake and this mistake led the clerk
to assign the case an equity case number, even though it is a law action. The
incongruous “petitioner and defendant” method of referring to the parties continued
in some later filings, but then even later filings included captions referring to the
parties as “plaintiff and defendant.” Given the random and inconsistent method of
referring to the parties throughout the filings, we place no weight on the equity case
number assigned to the case or the district court’s reference to the parties as
petitioner and respondent in determining whether this is an action at law or equity.
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110 (Iowa 2013). If the district court’s findings of fact are supported by substantial
evidence, we are bound by those findings. Id. However, the district court’s legal
conclusions or application of legal principles do not bind us. Id.
On appeal, Junk Brothers argues the lease was voidable because there
was no meeting of the minds between it and the county due to a mutual mistake
as to the condition of the fence when the lease was signed. We do not reach the
merits of this argument because we find two issues alluded to in the district court’s
ruling, but not addressed in the parties’ briefs, are dispositive, namely error
preservation and judicial estoppel against inconsistent positions.
As to error preservation, the district court noted in its ruling that Junk
Brothers raised the issue of mistake or lack of meeting of the minds for the first
time in its written closing argument and the position taken in the written closing
argument conflicted with the position taken in Junk Brothers’s pleadings and at
trial. Due to the conflicting and late nature of this argument, the district court
declined to address it. While we agree with the district court that Junk Brothers’s
after-the-fact raising of this issue was too late, of particular importance as it relates
to error preservation is the fact that Junk Brothers’s written closing argument urged
“there [was] no contract because the minds of the parties [did] not meet” and
“[t]here was no meeting of the minds and therefore no contract exist[ed].” This
conflicts with Junk Brothers’s position on appeal, which is that there was a contract
but it was voidable. Due to Junk Brothers raising a different issue on appeal than
raised at the district court, Junk Brothers has failed to preserve error on its claim
the contract is voidable. See State v. Rutledge, 600 N.W.2d 324, 325 (Iowa 1999)
(“Nothing is more basic in the law of appeal and error than the axiom that a party
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cannot sing a song to us that was not first sung in trial court.”). Although the county
did not raise this error preservation issue, we are free to do so on our own motion.
See Top of Iowa Coop v. Sime Farms, Inc., 608 N.W.2d 454, 470 (Iowa 2000) (“In
view of the range of interests protected by our error preservation rules, this court
will consider on appeal whether error was preserved despite the opposing party’s
omission in not raising this issue at trial or on appeal.”).
As to judicial estoppel, in its petition, Junk Brothers alleged the existence of
a contract between the parties and sought damages for breach of that contract.
Nowhere in the petition does Junk Brothers allege mistake, allege lack of meeting
of the minds, or seek avoidance of the contract. The county admitted the existence
of a contract in its answer and counterclaim. The case was tried based on those
pleadings, and the district court ruled on the claims as alleged in the pleadings.
Having taken the position in its pleadings and at trial that there was a valid contract
for which it was entitled to recover damages for its breach, Junk Brothers cannot
now take the opposite position that the lease was not a binding contract and seek
the remedy of avoidance. See State v. Duncan, 710 N.W.2d 34, 43 (Iowa 2006)
(“A party who has, with knowledge of the facts, assumed a particular position in
judicial proceedings is estopped to assume a position inconsistent therewith to the
prejudice of the adverse party.” (quoting Snouffer & Ford v. City of Tipton, 129
N.W. 345, 350 (Iowa 1911))); Wilson v. Liberty Mut. Group, 666 N.W.2d 163, 166
(Iowa 2003) (describing judicial estoppel as “a ‘common sense’ rule, designed to
protect the integrity of the judicial process by preventing deliberately inconsistent
—and potentially misleading—assertions from being successfully urged in
succeeding tribunals”); Duder v. Shanks, 689 N.W.2d 214, 221 (Iowa 2004)
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(“Judicial estoppel . . . applies when inconsistent positions otherwise meeting the
requirements of this doctrine are taken in the same proceeding.”); Beddall v. State
Street Bank & Trust Co., 137 F.3d 12, 23 (1st Cir. 1998) (“We generally will not
permit litigants to assert contradictory positions at different stages of a lawsuit in
order to advance their interests.”). Although neither party raised this issue in its
brief, “[b]ecause the doctrine is intended to protect the courts rather than the
litigants, an appellate court may raise estoppel on its own motion.” Duncan, 710
N.W.2d at 43–44. We determine Junk Brothers is estopped from arguing the lease
was not a binding contract or that it was voidable, having taken a contrary position
in its pleadings and presentation of evidence.
Finding these two issues dispositive, we do not reach the issue raised by
the parties, which is whether there was a mutual mistake and whether that made
the contract voidable. In fact, we would be unable to address this issue even if we
felt it appropriate to do so. As noted, the district court declined to address this
issue because it was raised for the first time in Junk Brothers’s written closing
argument submitted after trial. Junk Brothers did not file a motion pursuant to Iowa
Rule of Civil Procedure 1.904(2) or any other motion asking the district court to
expand its ruling to address the issue. Filing such a motion is required to preserve
error “when the district court fails to resolve an issue, claim, or other legal theory
properly submitted for adjudication.” See Meier v. Senecaut, 641 N.W.2d 532, 539
(Iowa 2002) (quoting Explore Info. Servs., 636 N.W.2d 50, 57 (Iowa 2001)). With
no ruling on this issue, we have no factual findings or legal conclusions by the
district court on this issue to review.
AFFIRMED.