Evenson v. Hlebechuk

305 N.W.2d 13, 32 U.C.C. Rep. Serv. (West) 154, 1981 N.D. LEXIS 270
CourtNorth Dakota Supreme Court
DecidedApril 23, 1981
DocketCiv 9899
StatusPublished
Cited by12 cases

This text of 305 N.W.2d 13 (Evenson v. Hlebechuk) is published on Counsel Stack Legal Research, covering North Dakota Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Evenson v. Hlebechuk, 305 N.W.2d 13, 32 U.C.C. Rep. Serv. (West) 154, 1981 N.D. LEXIS 270 (N.D. 1981).

Opinion

ERICKSTAD, Chief Justice.

The defendants, David and Janice Hlebe-chuk, appeal from a summary judgment entered against them by the District Court of Cass County contending that they should have been allowed to present parol evidence concerning a promissory note issued by them to plaintiff, William Evenson. We affirm the summary judgment entered by the district court.

It is undisputed that Evenson was employed by the Hlebechuks to sell a twelve-plex apartment building in Casselton, North Dakota. A purchaser, Darwin Jacobson, was procured by Evenson. An earnest money receipt and agreement was entered into between Jacobson and the Hlebechuks. Jacobson paid $12,500 as a down payment. The Hlebechuks were to carry a contract for deed for the balance of $237,500 for a term of 20 years with a balloon payment due at the end of two years. At the end of this period, Jacobson had an option for an additional two-year period to pay the balloon.

On June 1, 1977, when the sale was consummated, the Hlebechuks executed a promissory note to Evenson in the amount of $12,500 “for services rendered by the payee to the makers in connection with the sale” of the apartment. 1 Subsequently, Jacobson failed to make any payments and in lieu of a foreclosure deeded the apartment building back to the Hlebechuks. Evenson demanded payment under the promissory note and the Hlebechuks refused to pay. They assert that the note was to become payable only if the balloon payment was made by Jacobson. Evenson contended that the promissory note was clear and unambiguous and that any parol evidence which contradicts the note is excluded by the parol evidence rule. The trial court, *15 after receiving briefs and holding a hearing, entered summary judgment for Evenson. The Hlebechuks assert the following issues on appeal:

“I.
“Whether the written contract of the parties, as evidenced by an Earnest Money Agreement and a Promissory Note executed by the parties, is ambiguous and uncertain as to Defendants’ obligation to pay Plaintiff his real estate commission for the sale of real property.
“II.
“Whether parol evidence is admissible to show the oral agreement of the parties subjecting Plaintiff’s real estate commission to a condition precedent that the purchaser make the deferred payments on a Contract for Deed with the Defendants, when that parol agreement was the inducing cause of a Promissory Note and an integral part of the consideration for the Promissory Note.
“HI.
“WTiether parol evidence is admissible to establish that a Promissory Note given for the commission on a sale of realty by the payee was delivered on the express condition that it was to be operative only when the purchaser made the deferred payments on the purchase price.
“IV.
“Whether Summary Judgment was appropriate under the circumstances of the present case.”

I. Scope of Review

On appeal from a summary judgment, we review the evidence in the light most favorable to the party against whom the summary judgment was granted. Jacob v. Hokanson, 300 N.W.2d 852, 854 (N.D.1980). The summary judgment will be upheld only if it appears that there is no genuine issue of any material fact and that the moving party is entitled to judgment as a matter of law. Rule 56, N.D.R.Civ.P.; Jacob v. Hokanson, supra; Winkjer v. Herr, 277 N.W.2d 579 (N.D.1979).

II. Admission of Parol Evidence

The district court determined that “[t]he promissory note together with the asserted earnest money contract and the asserted Contract for Deed are clear, certain and unambiguous on their face,” 2 and that pa-rol evidence was not admissible.

A. Ambiguous Contract

The Hlebechuks assert that the written agreement of the parties concerning the real estate commission is ambiguous and that parol evidence is admissible to explain the true meaning of the terms of the agreement.

The promissory note falls under the commercial paper chapter of North Dakota’s Uniform Commercial Code as it is a negotiable instrument. § 41-03-04, N.D.C.C. As required by Section 41-03-04, the note (a) was signed by the makers, the Hlebechuks; (b) contained an unconditional promise to pay a sum certain, $12,500 at 9¾% interest; (c) is payable at a definite time; and (d) is payable to the order of William Evenson. § 41-03-04, N.D.C.C. Thus, the note is governed by the Uniform Commercial Code.

The parol evidence rule of Section 9-06-07, N.D.C.C., also is applicable as a general principle of law to supplement the U.C.C. § 41-01-03, N.D.C.C.; Peoples Bank & Trust v. Reiff, 256 N.W.2d 336, 340 (N.D.1977).

Section 9-06-07, N.D.C.C., provides:

“9-06-07. Written contract supersedes oral negotiations. — The execution of a contract in writing, whether the law requires it to be written or not, supersedes all the oral negotiations or stipulations concerning its matter which preceded or accompanied the execution of the instrument.”

*16 We have previously held that “[t]his is a legislative enactment, in part, of the parol evidence rule. * * * This is not an evidentiary or interpretive rule, but rather one of substantive law.” Gajewski v. Bratcher, 221 N.W.2d 614, 626 (N.D.1974). Parol evidence is admissible, however, when the writing is ambiguous. Johnson v. Auran, 214 N.W.2d 641, 652 (N.D.1974). Whether or not the writing is ambiguous is a question of law for the court to determine. Id. at 653.

The district court considered the earnest money receipt and agreement between Jacobson and the Hlebechuks in reaching its determination that the writing was not ambiguous. At the bottom of this writing there is a handwritten note after the printed statement “OWNER’S CLOSING INSTRUCTIONS AND AGREEMENT TO PAY COMMISSION” which simply states “Deferred with Balloon”. This portion of the earnest money receipt and agreement is not signed by any of the parties. The Hle-bechuks contend that when this writing is interpreted and construed together with the promissory note it raises an ambiguity. We disagree.

The district court properly construed the promissory note and the earnest money receipt and agreement together as they were both executed as part of the same transaction and contained terms relating to the commission to be paid. § 41-03-19, N.D.C.C.; see also Sanden v. Hanson, 201 N.W.2d 404, 408 (N.D.1972).

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Cite This Page — Counsel Stack

Bluebook (online)
305 N.W.2d 13, 32 U.C.C. Rep. Serv. (West) 154, 1981 N.D. LEXIS 270, Counsel Stack Legal Research, https://law.counselstack.com/opinion/evenson-v-hlebechuk-nd-1981.