This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. ß 480A.08, subd. 3 (1998).
STATE OF MINNESOTA
IN COURT OF APPEALS
Schaefer Chiropractic Center, Ltd., et al.,
Farmers & Merchants State Bank,
Filed December 7, 1999
Affirmed in part, reversed in part, and remanded
Stearns County District Court
File No. CX-98-2409
Robert D. Stoneburner, Stoneburner Law Office, 100 Washburne Ave., Paynesville, MN 56362 (for appellants)
H. Kelsey Page, Standke, Green & Greenstein, Ltd., 17717 Highway 7, Minnetonka, MN 55345 (for respondent Farmers & Merchants State Bank)
Stephen P. Larson, 219 Eighth Ave. S., St. Cloud, MN 56301-4251 (for respondent Vogt)
Considered and decided by Randall, Presiding Judge, Klaphake, Judge, and Holtan, Judge.[*]
U N P U B L I S H E D O P I N I O N
Schaefer Chiropractic Center, Ltd., and Michael J. Schaefer, D.C., individually, (collectively Schaefer Chiropractic) appeal from summary judgment granted in favor of their bank, respondent Farmers & Merchants State Bank (bank), in their action to recover nearly $80,000 in funds belonging to Schaefer Chiropractic. The funds were embezzled by Schaefer Chiropracticís office manager, Patricia Vogt, between 1988 and 1994, when she repeatedly submitted to the bank improperly endorsed checks made out to Schaefer Chiropractic, which the bank cashed. The bank filed a notice of review and challenges the district courtís refusal to order Schaefer Chiropractic to pay costs associated with the bankís obtaining evidence of the improperly cashed checks. Because the statute of limitations for claims arising out of the Uniform Commercial Code bars Schaefer Chiropracticís claim, we affirm summary judgment on their claims. Because there are numerous disputed material facts on the bankís claim for reimbursement of costs, we reverse and remand on that claim.
D E C I S I O N
The bank contends that the district courtís grant of summary judgment should be affirmed because the applicable statute of limitations had expired before Schaefer Chiropractic initiated this action. We agree. Under Minnesotaís version of the Uniform Commercial Code (UCC), there is a three-year statute of limitations for actions for "conversion of an instrument" or actions "to enforce an obligation, duty, or right arising under this article[.]" Minn. Stat. ß 336.3-118(g) (1998).
The limitations period "follows general law in stating that the period runs from the time the cause of action accrues." Minn. Stat. Ann. ß 336.3-118, UCC cmt. (West Supp. 1999). The UCC does not further define "accrues," but under the general law for contract and tort actions, a cause of action accrues either upon the breach or at the time of the act that causes injury. See, e.g., Berres v. Anderson, 561 N.W.2d 919, 922 (Minn. App. 1997), review denied (Minn. June 11, 1997); Zagaros v. Erickson, 558 N.W.2d 516, 522 (Minn. App. 1997), review denied (Minn. Apr. 17, 1997).
Thus, Schaefer Chiropracticís action is time-barred because Vogtís final acts of embezzlement occurred in 1994, four years before this action was commenced. Further, there are no facts that would support a claim that the bank fraudulently concealed Schaefer Chiropracticís cause of action and that the statute of limitations should therefore be tolled because Schaefer Chiropractic was ignorant of its cause of action. See Haberle v. Buchwald, 480 N.W.2d 351, 357 (Minn. App. 1992), review denied (Minn. Aug. 4, 1992). Although the district court did not rule on the bankís statute of limitations claim, it provides the proper basis for affirming the district courtís grant of summary judgment to the bank. See Northway v. Whiting, 436 N.W.2d 796, 798 (Minn. App. 1989) (appellate court "may affirm a summary judgment if there are no genuine issues of material fact and if the decision is correct on other grounds"); see also Krogness v. Best Buy Co., 524 N.W.2d 282, 287 (Minn. App. 1994) (appellate court "will affirm a summary judgment if it can be sustained on any grounds"), review denied (Minn. Jan. 25, 1995).
On review, the bank claims the district court erred in denying the bankís request for $6,123 in labor and copying costs associated with locating and copying the checks that Vogt submitted for cash payment. Under the partiesí contract, the bank could charge "a reasonable fee" for such enumerated services as overdrafts, stop payment requests, account maintenance, and "for any unusual services rendered by the financial institution in respect to the depositorís account."
The bank alleges that, through Schaeferís wife, Schaefer Chiropractic was informed that it would be costly to locate and copy the checks, was told of the outstanding amount for locating and copying the first set of checks, and agreed to pay the charges. The labor costs were charged at a rate of $20 per hour, although one of the two bank employees hired to do the copying stated that she was paid $8 per hour. The bank explained that the $12 per hour additional amount it charged Schaefer was for insurance and unemployment insurance it paid for these employees.
While there appears to be record support for the district courtís conclusion that the bankís claims were not "reasonable," we conclude that it was improperly resolved by summary judgment. This issue is interwoven with disputed facts concerning the existence of and effect to be given to a contract. As such, it was improper for summary judgment. See DLH, Inc. v. Russ, 566 N.W.2d 60, 70 (Minn. 1997) ("district courtís function on a motion for summary judgment is not to decide issues of fact, but solely to determine whether genuine factual issues exist"); Albany Roller Mills, Inc. v. Northern United Feeds & Seeds, Inc., 397 N.W.2d 430, 433 (Minn. App. 1986) (improper to grant summary judgment on contract claim where material fact issue exists on whether party had waived provision requiring written modification of contract). Thus, we reverse and remand on the bankís reimbursement of costs claim.
Affirmed in part, reversed in part, and remanded.[*] Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.