may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Damark International, Inc.,
Herold Marketing Associates, Inc.,
Filed July 27, 1999
Hennepin County District Court
File No. 96015669
Konstandinos Nicklow, Meshbesher & Spence, Ltd., 1616 Park Avenue, Minneapolis, MN 55404 (for respondent).
Considered and decided by Peterson, Presiding Judge, Short, Judge, and Shumaker, Judge.
Appellant challenges the trial court's denial of its alternative motions for amended findings or a new trial, arguing that (1) the special verdict question regarding contract integration and course of dealing was not a jury issue; and (2) it should have been allowed to amend the complaint and allege consumer fraud. We affirm.
Appellant Damark International, Inc. sells merchandise to the public through catalogs. Respondent Herold Marketing Associates, Inc., d/b/a Graphics Technologies, Incorporated (GTI), sells computer products.
Beginning in 1989, Damark regularly purchased computer products from GTI. The parties used Damark's purchase order form as the written evidence of their transactions. At first, the form provided that Damark would deduct the cost of or receive credit for defective products, and that a product is defective if a customer says it is. Damark later changed the form to delete the customer reference. Still later, Damark changed the form to provide for returns for "cash credit." Until 1995, despite the varying language of the form regarding returns, GTI routinely accepted Damark returns within one year of sale and gave Damark a cash refund or a credit on its account.
In 1995, two of GTI's manufacturers went out of business. After that, GTI refused to accept returns of goods made by those manufacturers. Damark sued for breach of contract.
Toward the end of the discovery period, Damark moved to amend its complaint to add a consumer fraud count. GTI moved to add a counterclaim for consumer fraud. The court reserved its ruling until completion of Damark's case-in-chief.
At trial, GTI introduced a Damark purchase order and argued that the order expressed the complete agreement of the parties. Apparently, paragraph 22 appeared in all versions of the purchase order; it stated:
This purchase order represents the entire agreement of the parties. None of the terms and conditions contained in this purchase order may be added to, modified, superseded or otherwise altered except by a written instrument signed by an authorized representative of DAMARK and Seller, and each shipment received by DAMARK from Seller shall be deemed to be only upon the terms and conditions contained in this purchase order notwithstanding any terms or conditions that may be contained in any acknowledgement invoice or other form of Seller and notwithstanding DAMARK's act of accepting or paying for any shipment or similar act of DAMARK.
Because of this language, GTI sought to exclude any parol evidence that contradicted the purchase order. The trial court noted that the purchase order was ambiguous in some respects, and, over GTI's objection, the court allowed Damark to introduce evidence of the parties' prior course of dealing as to merchandise returns so as to explain the ambiguities.
At the conclusion of the trial, the court decided to have the jury answer six special verdict questions. The first four pertained to the parties' agreements and course of dealing:
QUESTION NO. 1
Did [Damark] and [GTI] have an agreement wherein Damark would be allowed to return all customer returns to GTI for a period of one year from the date of purchase, regardless of whether the product was, in fact, defective?
QUESTION NO. 2
Did GTI fully reimburse Damark for all product returned by Damark to GTI?
QUESTION NO. 3
Was there a course of dealing by and between Damark and GTI whereby GTI unconditionally agreed to accept all of Damark's customer returns for a period of one year?
QUESTION NO. 4
If your answer to Question No. 1 or to Question No. 3 is "yes," then answer this question: does either the agreement in Question 1 or the course of dealing in Question 3 contradict the "Remedies" provision (paragraph 7) or the "Entire Agreement" provision (paragraph 22) of Damark's purchase orders?
Question 5 asked about damages for GTI's refusal to accept returned merchandise, and question 6 asked about damages for GTI's failure to reimburse Damark for returned merchandise.
The jury answered yes to questions 1, 3 and 4, and no to question 2. The jury answered questions 5 and 6 by inserting damages amounts.
Before the court submitted the case to the jury, Damark objected to the inclusion of question No. 4 on the special verdict form, arguing that the subject of that question was an issue of law for the court.
After the jury returned its verdict, the court ordered entry of judgment in Damark's favor for only $13,314, the amount in question 6. Because of the jury's affirmative answer to question 4, the court did not award the damages in question 5. The court denied Damark's posttrial motions and Damark appealed.
On appeal from a denial of a motion for a new trial, the verdict must stand unless it is manifestly and palpably contrary to the evidence, viewed in the light most favorable to the verdict.
ZumBerge v. Northern States Power Co., 481 N.W.2d 103, 110 (Minn. App. 1992), review denied (Minn. Apr. 29, 1992) (citation omitted).
Special Verdict Question 4
Despite the fact that all of Damark's purchase orders contained an integration clause, Damark agrees that it was proper for the court to admit parol evidence of the parties' course of dealing. However, it was improper, according to Damark, for the court to ask the jury whether any agreement outside the purchase order or any course of dealing contradicted the purchase order language. Damark contends that the issue in question 4 is a question of law for the court.
In allowing parol evidence on the issue of merchandise returns, the court was attempting to resolve ambiguities in Damark's purchase orders. This was proper under the U.C.C.:
Terms * * * set forth in a writing intended by the parties as a final expression of their agreement with respect to such terms as are included therein may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement but may be explained or supplemented
(a) by course of dealing * * *
(b) by evidence of consistent additional terms[.]
Minn. Stat. § 336.2-202 (1998).
In asking question 4, the court was attempting to determine whether any other agreement or a course of dealing contradicted Damark's purchase order. The answer would inform the court of the ultimate legal result of the case because
[t]he express terms of an agreement and an applicable course of dealing * * * shall be construed whenever reasonable as consistent with each other; but when such construction is unreasonable express terms control * * * course of dealing.
Minn. Stat. § 336.1-205(4) (1998).
Because the purchase orders drafted by Damark expressly provided that they contained the entire agreement between the parties, the terms of the purchase orders regarding merchandise returns would control any inconsistent agreement or course of dealing. Even if, as Damark argues, only the trial court had authority to answer question 4, the trial court ultimately did answer that question by adopting the special verdict "as the Court's Findings of Fact" and by concluding that the "jury's findings in this Special Verdict are supported by the law and the evidence." The trial court did not err by submitting question 4 to the jury and then adopting the jury's answer as its own.
Motion to Amend
The court ultimately denied Damark's motion to amend its complaint to add a consumer fraud count. Damark argues that the court's determination that the Consumer Fraud Act did not apply was error. The act provides in part:
Subdivision 1. Fraud, misrepresentation, deceptive practices. The act, use, or employment by any person of any fraud, false pretense, false promise, misrepresentation, misleading statement or deceptive practice, with the intent that others rely thereon in connection with the sale of any merchandise, whether or not any person has in fact been misled, deceived, or damaged thereby, is enjoinable as provided herein.
Minn. Stat. § 325F.69, subd. 1 (1998).
The decision to allow an amendment to a party's pleading is discretionary with the trial court. Copeland v. Hubbard Broad., Inc., 526 N.W.2d 402, 405 (Minn. App. 1995). Here, the court listened to all of Damark's evidence before making its ruling and thus was able to evaluate the credibility of that evidence. We cannot re-evaluate credibility issues. General v. General, 409 N.W.2d 511, 513 (Minn. App. 1987). Damark's burden was to produce sufficient evidence to sustain its claim of fraud. See Hunt v. University of Minn., 465 N.W.2d 88, 95 (Minn. App. 1991) (motion to amend properly denied when additional claim is not supported by evidence). If the court resolved credibility conflicts on the issue of fraud against Damark, which it apparently did, there was insufficient evidence to prove a fraud claim. Thus, the court properly exercised its discretion in denying Damark's motion to amend.