This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. ß 480A.08, subd. 3 (2000).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

C0-00-1542

 

Karen Imoe, et al.,

Appellants,

 

vs.

 

Lake Investors, et al.,

Respondents,

 

Jerome Hettwer,

Respondent.

 

Filed April 3, 2001

Affirmed

Hanson, Judge

 

Sherburne County District Court

File No. C8-98-1953

 

 

John R. Koch, Reichert, Wenner, Koch & Provinzino, P.A., 501 St. Germain, P.O. Box 1556, St. Cloud, MN 56302 (for appellant Karen Imoe)

 

Robert J. Feigh, Hall & Byers, P.A., 1010 West St. Germain, Suite 600, St. Cloud, MN 56301 (for respondent Lake Investors)

 

Frank J. Rajkowski, Rajkowski Hansmeier, Ltd., 11 Seventh Avenue North, P.O. Box 1433, St. Cloud, MN 56302 (for respondent Jerome Hettwer)

 

††††††††††† Considered and decided by Harten, Presiding Judge, Crippen, Judge, and Hanson, Judge.

 

U N P U B L I S H E D†† O P I N I O N

HANSON, Judge


Appellant purchased a bowling alley under a contract for deed.† She argues that the financial statements presented by the broker (showing net income from the previous operation of the alley for 1992 through 1995) and the failure to disclose that the previous operator had suffered losses, constitute fraud as a matter of law.† Because there was sufficient evidence at the bench trial to support the district courtís findings that respondents had informed appellant how the financial statements were prepared and that they were unreliable, and had provided appellant opportunity to review the records of the previous operator, we affirm.

FACTS

In August of 1996, appellant Karen Imoe and her husband purchased a bowling alley in Big Lake from respondent Lake Investors.† Respondent Jerome Hettwer acted as real estate agent in the transaction.† The purchase price of $385,000 was based on real estate valued at $363,000 and personal property valued at $22,000.† No portion of the purchase price was allocated to goodwill or accounts receivable because the alley was out of business.

When Imoe first consulted Hettwer about bowling alley properties, Hettwer presented her with a 12-page brochure describing the Big Lake property.† The brochure included a financial statement developed by Hettwer from records provided by the previous operator of the alley, for 1992 through 1995.† The previous operator had leased the bowling alley from Lake Investors for several years before closing in May of 1996.† In preparing the financial statement for the brochure, Hettwer omitted the rental expenses of the previous operator because the alley was to be sold, not leased.† He also deleted other expenses peculiar to the prior operator, such as car and truck expenses.† He mistakenly included in operating revenues some amounts that had actually come from loans not from operations.†

Hettwer told Imoe that he could not vouch for the credibility of the previous operator or the accuracy of the financial statements.† He also told Imoe how the financial statements had been prepared and identified each adjustment he had made to the actual profit and loss statements of the prior operator.† Duane Schultz, of respondent Lake Investors, also met with Imoe prior to closing and gave her the opportunity to review all of the financial information that respondents had received from the prior operator.

Imoe and her husband made contract for deed payments until April of 1998, after which they made no further payments.† In August of 1998, their insurance policy was canceled and they ceased operation of the alley.

In September of 1998, the Imoes filed a complaint for recision of the contract for deed, alleging that respondents committed fraud in inducing the Imoes to purchase the property and seeking judgment for payments made to Lake Investors on the contract and other expenses.† In October of 1998, the Imoes entered into an agreement to return the real and personal property to Lake Investors in satisfaction of all past due contract payments or other obligations, reserving all claims made in the pending litigation.†

In September of 1999, the district court granted summary judgment against the husband, Murlan Imoe, on the grounds that he was not present during negotiations and had not been the recipient of any of the alleged fraudulent representations, but denied summary judgment against Karen Imoe, determining that there were genuine issues of material fact relating to her claims of fraud.† Murlan Imoe did not appeal.†

The matter was then tried to the court, without a jury, and on June 11, 2000, the court entered Findings of Fact, Conclusions of Law and Order for Judgment in favor of respondents, finding that Karen Imoe had not established the elements of fraud.† This appeal followed.†

D E C I S I O N

Imoe argues that the district courtís findings on the elements of fraud were not supported by the evidence and were clearly erroneous.† The question of fraudulent intent is an issue for the trier of fact. Sutton v. Viking Oldsmobile Nissan, Inc., 611 N.W.2d 60, 66 (Minn. App. 2000).† We will not set aside the district courtís findings of fact unless they are clearly erroneous, viewed ďin the light most favorable to the judgment of the district court.Ē† Rogers v. Moore, 603 N.W.2d 650, 656 (Minn. 1999) (citation omitted) (applying Minn. R. Civ. P. 52.01).

In finding that the respondents did not act with fraudulent intent, the district court considered the five elements recognized by the Minnesota Supreme Court:

The required elements of a fraud action are: (1) there was a false representation by a party of a past or existing material fact susceptible of knowledge; (2) made with knowledge of the falsity of the representation or made as of the party's own knowledge without knowing whether it was true or false; (3) with the intention to induce another to act in reliance thereon; (4) that the representation caused the other party to act in reliance thereon; and (5) that the party suffer pecuniary damage as a result of the reliance.

 

Specialized Tours, Inc. v. Hagen, 392 N.W.2d 520, 532 (Minn. 1986).† The district court found that while the financial statement was inaccurate, it was not a false representation; that respondents did not intend to induce Imoe to act in reliance upon it; that Imoe did not act in reliance upon it; and that Imoe suffered no damages.† In order to prevail on this appeal, Imoe must establish that each of these findings was clearly erroneous.

At trial, the district court heard testimony from Hettwer and Imoe regarding the real estate brochure and the financial statement it contained.† Hettwer testified that he told Imoe that the previous operator of the alley, from whom he obtained the financial information, was uncooperative; that the financial statement was unreliable; and that he could not vouch for its accuracy.† Imoe confirmed that Hettwer informed her of the financial statementís unreliability and that this caused her concern.† Hettwer further testified that he explained to Imoe each of the adjustments that he had made to the previous operatorís profit and loss statements.† Imoe did not contradict this testimony, and agreed that she had been given the opportunity to review the previous operatorís actual records and statements.† Thus, this is not a situation where the district court was required to assess contradictory testimony; the district court actually heard complimentary testimony that supported its findings that there was no false representation, no fraudulent intent and no reliance.† Those findings were not clearly erroneous.

Imoe argues that the district court committed reversible error in failing to make a finding on whether respondents knew their representations were false or made their representations without knowing whether they were true or false.† However, Imoe did not move for a new trial or amended findings before the district court and, thus, the only questions on appeal are whether the evidence sustains the findings of fact and whether such findings support the conclusion of law and the judgment.† Novack v. Northwest Airlines, Inc., 525 N.W.2d 592, 596 (Minn. App. 1995); see also Frank v. Illinois Farmers Ins. Co., 336 N.W.2d 307, 311 (Minn. 1983) (noting that where alleged omitted findings of fact are not brought to the attention of the district court in a motion for amended findings, there is nothing before the court to review on appeal).† Moreover, since the district court effectively found that respondents did not make a positive or unqualified representation, no additional findings were necessary.

Affirmed.