This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Ronald L. Merchlewitz, et al.,
Agora Syndicate, Inc.,
Tower Special Facilities, Inc.,
Filed January 18, 2000
Reversed and remanded
Hennepin County District Court
File No. 98008051
David G. Newhall, Christopher H. Yetka, Lindquist & Vennum, P.L.L.P, 4200 IDS Center, 80 South Eighth Street, Minneapolis, MN 55402 (for respondents Ronald L. Merchlewitz, et al.)
Steven E. Wolter, Douglas A. Kelley, P.A., Centre Village Offices, Suite 2530, 431 South Seventh Street, Minneapolis, MN 55415;
Regina M. Chu, Regina M. Chu, P.A., 701 Fourth Avenue South, Suite 500, Minneapolis, MN 55415; and
Michael P. Tone, Wilson, Elser, Moskowitz, Edelman & Dicker, L.L.P., 120 North LaSalle Street, Chicago, IL 60602 (for appellant)
Robert W. Kettering, Jr., Thomas A. Forker, Arthur, Chapman, Kettering, Smetak & Pikala, P.A., 500 Young Quinlan Building, 81 South Ninth Street, Minneapolis, MN 55402 (for respondent Tower Special Facilities, Inc.)
Britton D. Weimer, Hagglund, Weimer & Speidel, 4000 Water Park Place, 5101 Olson Memorial Highway, Minneapolis, MN 55422 (for respondent Heartman Agency)
Considered and decided by Anderson, Presiding Judge, Short, Judge, and Foley, Judge[*].
U N P U B L I S H E D O P I N I O N
Ronald Merchlewitz (Merchlewitz) was injured when a participant’s vehicle crashed into the stands at the Stockton Stampede Mud Drag Races. Agora Syndicate, Inc. (Agora) insured Midwest Four Wheel Drive Association (Midwest) and Stockton Area Promotions Group (SAPG) against injury to spectators at the race, which they sponsored. But the insurance contract contained a motorized-vehicle-liability exclusion.
Merchlewitz filed a negligence action against Midwest and SAPG. As part of a Miller-Shugart settlement agreement, Midwest consented to a $100,000 judgment and SAPG agreed to pay its policy limits of $1,000,000. Merchlewitz then sued Agora to enforce the judgment. On appeal from summary judgment granted in favor of Merchlewitz, Agora argues the trial court erred by: (1) reforming the insurance contract and granting summary judgment when there were genuine issues of material fact; (2) denying summary judgment to Agora on Merchlewitz’s fraud claims; (3) holding that Agora was collaterally estopped from attacking the reasonableness of the Miller-Shugart settlements; (4) requiring Agora to pay attorney fees when the policy was reformed to provide coverage; and (5) refusing to vacate the judgment based on Agora’s offer of newly discovered evidence. We reverse and remand.
D E C I S I O N
On appeal from summary judgment, we determine whether genuine issues of material fact exist and whether the trial court erred in its application of the law. State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990); see Minn. R. Civ. P. 56.03 (setting forth trial court standard for summary judgment). This court views 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). Summary judgment is not intended to substitute for a trial when there are factual issues to be determined. DLH, Inc. v. Russ, 566 N.W.2d 60, 69-70 (Minn. 1997).
Reformation requires clear and convincing evidence of three elements: (1) a valid agreement between parties expressing their real intentions, (2) a written instrument that fails to express the parties’ real intentions, and (3) failure resulting from the parties’ mutual mistake or a unilateral mistake accompanied by fraud or inequitable conduct by the other party. Nichols v. Shelard Nat’l Bank, 294 N.W.2d 730, 734 (Minn. 1980). In reforming the insurance contract and granting judgment for Merchlewitz, the trial court adopted Merchlewitz’s facts and reasoning. But the record indicates there are genuine issues of material fact concerning: (1) whether Heartman Agency and Tower Special Facilities, Inc. were Agora’s agents; (2) whether the alleged conversation between Jenna Luebbens and Theresa Biron took place; (3) what knowledge the insured had about coverage of accidents involving motor vehicles; and (4) whether the parties had a valid agreement expressing their real intentions. See O’Malley v. Ulland Bros., 549 N.W.2d 889, 892 (Minn. 1996) (finding fact material if its resolution will affect outcome of case); Zappa v. Fahey, 310 Minn. 555, 556, 245 N.W.2d 258, 259-60 (1976) (defining material fact as one affecting outcome or result of case depending on its resolution); see also Vacura v. Haar’s Equip., Inc., 364 N.W.2d 387, 391 (Minn. 1985) (holding existence of an agency relationship is a question of fact).
Tower argues different exclusions in the same numbered endorsements constitute enough evidence to reform the contract. See American Sur. Co. v. Williford, 243 F.2d 494, 498 (8th Cir. 1957) (holding insurer cannot change terms of oral contract by issuing nonconforming policy). But this argument also depends on resolution of material facts related to the question of agency. After a careful review of the record, we conclude fact issues preclude summary judgment. Because we reverse the judgment, we also vacate attorney fees and costs awarded to Merchlewitz.
Reversed and remanded.[*] Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.