Eric A. Bartsch, Berens, Rodenberg & O'Connor, 519 Center Street, Post Office Box 428, New Ulm, MN 56073 (for Respondent)

James R. Anderson, Post Office Box 1196, Marshall, MN 56258 (for Appellant)

Considered and decided by Harten, Presiding Judge, Parker, Judge, and Davies, Judge.

Appellant Tom Regnier challenges the district court grant of summary judgment to respondent R & G Construction Company. Because we find that a genuine issue of material fact exists as to whether there was a mutual mistake of fact between the parties, we reverse and remand for further proceedings.

Here, the district court granted summary judgment to R & G Construction Company, finding that no genuine issue of material fact existed as to whether it was entitled to restitution of $11,104.40 of a $14,000 payment it made to landowner Tom Regnier.

R & G contracted with Regnier to remove approximately 20,000 yards of fill from Regnier's farm for a municipal airport project in return for $14,000 to be paid prior to removal of any fill. R & G removed only 2,826 yards and requested a refund of approximately $11,000. Regnier refused. R & G sued Regnier on the theory of mutual mistake of fact, claiming that because both parties were mistaken as to the amount of fill needed for the project, R & G should be allowed to avoid the contract. See Carpenter v. Vreeman, 409 N.W.2d 258, 261 (Minn. App. 1987) (mutual mistake consists of clear showing of misunderstanding, reciprocal and common to both parties, with respect to terms and subject matter of contract).

If both parties had been mistaken as to the amount of fill needed at the time the contract was signed, R & G would be entitled to a measure of restitution. See id., (if appellant proves mutual mistake of fact, and respondent has no affirmative defense, appellant is entitled to relief). We conclude, however, that a genuine issue of material fact exists as to whether both parties were mistaken.

It is undisputed that at the time the contract was signed, Regnier believed that approximately 20,000 yards of fill would be removed from his farm for the project. The question becomes whether at the time the contract was signed R & G also was mistaken as to the yardage required for the project. We believe that disputed facts bearing on that question demand resolution by a factfinder and preclude summary judgment.

R & G alleges that the contract was signed on Monday, July 17, 1995. Regnier alleges that it was signed on Saturday, July 22, 1995. The date of the contract is significant because the project was being resurveyed, an action that eventually affected the amount of fill needed. A representative from McLaughlin & Schultz, Inc. (the general contractor) testified that his project notes reflect that the resurvey was conducted on Monday, July 17, 1995. He also testified that R & G's Gregg Mathiowetz was present during the resurvey. Were this the case, R & G would have been aware on July 17, 1995 that less than approximately 20,000 yards would be needed from Regnier. When McLaughlin & Schultz, Inc. discovered the discrepancy, R & G was notified immediately. This notification would have occurred between Monday, July 17 and Friday, July 21. The date written on the contract is July 17. But both Regnier and Mathiowetz testified that the contract was signed on a Saturday. July 17 was a Monday. They remembered the day because Regnier wanted to come in over the weekend to avoid taking time off work. Were the contract signed on Saturday, July 22, and not Monday, July 17, R & G would have been fully aware at the time it signed the contract that it would not need 20,000 yards of fill from Regnier. The date the contract was signed is significant because Regnier alleges that R & G induced him to sign the contract by representing that approximately 20,000 yards of fill would be taken. Regnier contends that R & G knew that he would never agree to the removal of a mere 2,826 yards because the risk of damage to the land would not have been worth it to him.

The contract bears a notation that $14,000 was paid to Regnier on July 24, 1995. Both parties stated that Regnier was paid "a couple of days" after the contract was signed because R & G was anxious to start the removal but Regnier would not allow it until he was paid. Regnier picked up the check from R & G when the R & G office was closed (the check was left for him in the mailbox). This fact could support evidence of Regnier's desire to not miss work during the week and his contention that the contract was signed on a Saturday, not a Monday. Finally, Regnier testified that much of the contract had been prepared by the time he arrived at the R & G office, and only a few things were filled in immediately before his signing. This evidence could support an inference that the date (July 17) was filled in by R & G prior to the day Regnier actually signed the contract.

We conclude that because the date the contract was signed presents a genuine issue of material fact, summary judgment is inappropriate. Accordingly, we reverse and remand for trial.[1]

Reversed and remanded.

DAVIES, Judge (concurring specially).

I respectfully concur, but write separately because I believe it necessary to reach appellant's second issue, the erroneous measure of damages.

In its summary judgment, the district court granted damages measured by the contract unit price. On remand, if it is again found that there was a mutual mistake of fact, the question will recur on whether that is the proper measure of damages.

That is an improper measure of damages for summary judgment because appellant offered evidence that the farm property was damaged beyond the value of the fill extracted. The damages issue must therefore also be presented to the fact-finder.

If on remand the mistake is found to be unilateral, appellant may be entitled to loss-of-bargain damages, which will also raise questions of material fact.

[ ]¹In view of this disposition, we need not address the issue of damages presented by the district court's use of a contractual measure of damages despite its finding that there was no contract.