may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1994).
STATE OF MINNESOTA
IN COURT OF APPEALS
Maria E. Lee,
Helen A. Lee,
Robert W. Lee,
Filed October 22, 1996
Goodhue County District Court
File No. C795703
Harry T. Neimeyer, Stringer & Rohleder, Ltd., 1200 Norwest Center, 55 East Fifth Street, St. Paul, MN 55101 (for appellant)
Barbara M. McLaughlin, Betcher Law Office, 425 West Third Street, Red Wing, MN 55066 (for respondent Helen A. Lee)
Timothy K. Dillon, Dillon Law Office, 400 West Mill Street, Cannon Falls, MN 55009 (for respondent Robert W. Lee)
Considered and decided by Short, Presiding Judge, Parker, Judge, and Crippen, Judge.
Maria Lee brought this action against her former spouse and his mother to invalidate a $180,000 marital debt for lack of consideration. Following a bench trial, the trial court concluded the promissory note and agreement executed by Lee's former spouse and his mother were supported by fair consideration, and entered judgment for Lee's former spouse and his mother. On appeal, Lee argues the documents are not the result of reciprocal bargaining, but represent a device to transfer assets during a marriage dissolution proceeding. We affirm.
It is elementary that a contractual promise must be the product of a bargained-for exchange. 1 Arthur L. Corbin, Corbin on Contracts § 1.10, at 27 (Joseph M. Perillo ed., rev. ed. 1993); Cederstrand v. Lutheran Brotherhood, 263 Minn. 520, 530, 117 N.W.2d 213, 220 (1962). While a contract must be supported by fair consideration, a court will not examine the adequacy of consideration as long as something of value has passed between the parties. See Baehr v. Penn-O-Tex Oil, 258 Minn. 533, 538-39, 104 N.W.2d 661, 665 (1960) (requiring exchange, although not of equivalent value, to support contractual promise); Ketterer v. Independent School Dist. No. 1, 248 Minn. 212, 223-24, 79 N.W.2d 428, 436-37 (1956) (placing substantial value on structural improvements to property, therefore declining to address adequacy of one dollar nominal consideration); Chalmers v. Kanawyer, 544 N.W.2d 795, 798 (Minn. App. 1996) (declining to judge adequacy of consideration where party to contract suffered some legal detriment); Gunhus v. Engelstad, 413 N.W.2d 148, 153 (Minn. App. 1987) (refusing to determine whether consideration was so unfair as to hold lease unconscionable where parties exchanged something of value), review denied (Minn. Nov. 24, 1987) (citing Estrada v. Hanson, 215 Minn. 353, 356, 10 N.W.2d 223, 225-26 (1943)).
Lee admits her former mother-in-law made cash advances to the couple. However, Lee argues the trial court's finding of "fair consideration" was erroneous because: (1) her former mother-in-law intended the cash as "gifts;" and (2) her former spouse's decision to purchase his mother's 60 percent interest in Lee Chevrolet made no economic sense. By contrast, the trial court found: (1) Lee's former mother-in-law loaned her son $95,200, plus $20,000 in interest payments to keep the family's Chevrolet dealership business from failing; (2) Lee's former spouse purchased his mother's interest in Lee Chevrolet, thereby obtaining full ownership of the business; (3) this acquisition was prompted by General Motors Corporation's requirements for dealership; and (4) Lee's former mother-in-law expected repayment from the couple. Although there was conflicting evidence at trial, the court's findings are amply supported by testimony from Lee's former spouse and the bookkeeper at Lee Chevrolet, and by deposition testimony of Lee's former mother-in-law. Given the substantial record support for the trial court's finding that the debt was based on "fair consideration," the trial court's decision is not clearly erroneous.