This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. ' 480A.08, subd. 3 (1994).


Donna Schoon,


Donald R. Klosterbuer, et al.,
Terry Murphy, intervenor,

Rock County District Court
File No. C7-95-10

Filed July 30, 1996

Toussaint, Chief Judge

Douglas E. Schmidt, Timothy F. Moynihan, Krass, Monroe, Schmidt, Moxness & Gibson, P.A., 1650 W. 82nd Street, Suite 1100, Bloomington, MN 55431-1447 (for appellant)

Skewes, Klosterbuer & Vajgrt, Box 538, Luverne, MN 55156 (for Donald R. Klosterbuer, et al.)

Paul M. Malone, Malone & Mailander, 2605 Broadway Avenue, Slayton, MN 56172 (for Terry Murphy)

Considered and decided by Toussaint, Chief Judge, Crippen, Judge, and Huspeni, Judge.


TOUSSAINT, Chief Judge

Appellant Donna Schoon challenges the trial court's grant of respondent Donald Klosterbuer's motions for summary judgment. Schoon argues that the trial court erred when it ordered the funds in the Schoon Escrow Account transferred to the personal representative of the Steven W. Schoon estate. Appellant commenced an action against respondents Donald Klosterbuer, Timothy Dispanet and Terry Murphy to enforce the terms of an escrow agreement and sought an order to disburse the escrowed funds to her. The trial court determined that enforcement of the escrow agreement terminated at Steven Schoon's death. We affirm.


On appeal from summary judgment, we ask "whether there are any genuine issues of material fact" and "whether the lower courts erred in their application of the law." State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990). "[T]he reviewing court must view 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).

I. Contract

Appellant argues that an escrow agreement, which resulted from a Restraining Order in the Schoon's dissolution, and a subsequent letter from Mr. Schoon's attorney that acknowledged the terms of an agreement, provided evidence that there was a binding contract governing the disposition of the funds from the stock sale transaction. The escrow agreement stated in part:

II- * * * A restraining order has issued prohibiting the sale or disposition of the assets of the first and second parties without prior consent of the parties or approval by the court. III- The parties, through their attorneys have agreed that the sale is in the best interests of both parties and that such should be concluded as scheduled but with restrictions as to the disposition of the proceeds of the sale. * * * 4. The balance of the sale proceeds shall be deposited in an interest bearing account at First National Bank in Pipestone, Minnesota, said account to be entitled, "Schoon Escrow Account" * * * there to remain until further order of the District Court, Rock County, Minnesota. * * *

A subsequent letter from Donald Klosterbuer, Mr. Schoon's attorney, confirmed in part:

(1) proceeds from the sale were deposited in the "Schoon Escrow Account"; and (2) no disbursements would be made except on written instructions from the parties or upon court order.

Before his death in March 1993, Mr. Schoon drafted a new will providing: (1) bequests to appellant and a trust for their son; and (2) a bequest of the estate's residual value to Terry Murphy and naming her co-personal representative.

Appellant contends that: (1) Mr. Schoon's death did not destroy the terms of this agreement.; and (2) once the funds were deposited into the escrow account they remained subject to the terms of the escrow agreement, and not Mr. Schoon's will, which was confirmed in Mr. Klosterbuer's letter.

The trial court found that: (1) the escrow agreement did not constitute a valid contract because it was never signed by the parties; (2) neither party had a one-half interest in the resulting funds; and (3) because there was not an agreement for distribution of the funds, appellant could not now claim to have any interest in the escrow account.

The trial court did not err in determining that there were no genuine issues of material fact or in its application of the law. The parties conduct in carrying out the sale of stock and placing the proceeds in an escrow account reflects mutual assent to the terms of the escrow agreement. Neither the escrow agreement or the dissolution court's restraining order addressed the division of the proceeds from the sale.

The construction and effect of a contract are questions of law for the court, however, where there is ambiguity and construction depends upon extrinsic evidence and a writing, there is a question of fact for the jury. Turner v. Alpha Phi Sorority House, 276 N.W.2d 63, 66 (Minn. 1979). An offeree may accept an offer for a contract by conduct which leads the offeror reasonably to assume he assents and accepts the terms contained in the offer. Schwandt Sanitation v. City of Paynesville, 423 N.W.2d 59, 67 (Minn. App. 1988).

[R]equisite mutual assent does not require a subjective mutual intent to agree on the same thing in the same sense, but may be based on objective manifestations where a party by his words, conduct or both leads the other party to reasonably assume that he assents and accepts the terms of the others offer.


Mr. Schoon's death terminated the jurisdiction of the family court. Tikalsky v. Tikalsky, 166 Minn 468, 470, 208 N.W. 180 (1926). We agree with the trial court that distribution of escrowed funds is a probate asset subject to the terms of Mr. Schoon's will. On review of the record before us, we conclude that the evidence supports the trial court's finding that the escrow agreement did not control the distribution of the escrowed funds.

II. Constructive Trust

Appellant also argues that the restraining order issued by the trial court expressly precluded either party from disposing or transferring assets without mutual consent or by court order. Appellant contends that Mr. Schoon's new will, which was drafted while the restraining order was in effect, and without her knowledge, effectively violated the court order. Appellant ultimately argues that because the new will violated the terms of the restraining order, the court should establish a constructive trust to remedy the wrongdoing of Mr. Schoon. Appellant cites us to American Family Life Ins. Co. v. Noruk, 528 N.W.2d 921 (Minn. App. 1995), review denied (Minn.Apr. 27, 1995), in support of her argument.

In American Family, this court held that equitable principles controlled the disposition of life insurance proceeds, where the decedent changed the policy beneficiary designation, in violation of a restraining order issued in dissolution proceedings, but died before a final judgment was issued in the dissolution. Id. at 922. This court further stated:

[W]hen a life insurance policy's designated beneficiary is changed in violation of a dissolution court's temporary order, and the death of one of the parties intercedes before a final judgment is rendered, equitable considerations control in determining the ownership of policy proceeds. Where equities favor the estranged spouse, a constructive trust should be imposed to divert insurance proceeds from the designated beneficiary to the spouse.

Id. at 924. However, "when one of the parties [to the dissolution] dies, * * * a temporary restraining order has no effect and the court's jurisdiction to enforce it ends." Id. at 923 (citing Brown v. Agin, 260 Minn. 104, 114, 109 N.W.2d 147, 153 (1961)).

Concluding that Mr. Schoon's death terminated the dissolution proceedings, the trial court determined that it was proper to pay the proceeds from the stock sale to Mr. Schoon's personal representative, as directed by his will. The trial court then held that any additional matters involving the estate were best left to the probate court.

This was not an issue raised before the trial court. Generally, this court will consider "only those issues that the record shows were presented and considered by the trial court in deciding the matter before it." Thiele v. Stich, 425 N.W.2d 580, 582 (Minn. 1988) (quoting Thayer v. American Fin. Advisers, Inc.322 N.W.2d 599, 604 (Minn. 1982). Because we do not reach the issue of formation of a constructive trust, we need not determine whether American Family is distinguishable from this case. We conclude, therefore, that the district court did not err in granting respondent's motions for summary judgment.