Opinion
No. C8-96-2092.
Filed June 17, 1997.
Appeal from the District Court, Washington County, File No. CO931452.
Kevin K. Shoeberg, Eckberg, Lammers, Briggs, Wolff, Vierling, P.L.L.P., (for Appellant)
Barry William McKee, (for Respondent)
Considered and decided by Peterson, Presiding Judge, Lansing, Judge, and Crippen, Judge.
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (1996).
UNPUBLISHED OPINION
Appellant Harvey Berg argues the district court awarded him insufficient damages for replevin. Respondent Leland Gohlike filed a notice of review challenging the damages awarded to him for breach of contract. We affirm in part, reverse in part, and remand.
FACTS
Appellant Harvey Skip Berg owned two vintage cars, a 1929 SSK Mercedes and a 1930 Cabriolet C Mercedes. The engine for the Cabriolet C was not assembled. Berg signed an agreement with respondent Leland Gohlike under which Gohlike would be paid a commission if he sold one or both of the cars. The agreement also provided:
If Skip Berg sells one or both cars himself, he agrees to pay Lee Gohlike a commission of 2.5% on the sale(s).
The agreement finally provided that Gohlike would install several parts on the SSK at his own expense before the car was sold.
Gohlike installed the parts on the SSK at Berg's shop. Then, with Berg's permission, Gohlike took the Cabriolet C engine parts to his own shop to assemble them. When a dispute arose about the terms of the parties' agreement, Berg demanded that Gohlike return the engine parts. Gohlike refused. Berg sold the SSK himself, then sued Gohlike for replevin and several other related claims. Gohlike sued Berg for breach of contract and two other related claims.
The district court found that Berg had breached the parties' agreement by failing to pay Gohlike a commission on the sale of the SSK. The court awarded Gohlike damages of 2.5% of the sales price of the SSK. The district court also determined that Gohlike took a complete, but unassembled, engine from Berg's shop. The court found that an auction house had offered to set a $375,000 reserve price for the Cabriolet C with the unassembled engine and that $375,000 was the base value of the car in this condition. The court found that the Cabriolet C was worth $300,000 without the engine and that the engine therefore was worth $75,000. The court ordered Gohlike to return all the engine parts in his possession to Berg or to pay Berg $75,000.
DECISION
A district court's findings of fact will not be set aside on appeal unless they are clearly erroneous. Minn.R.Civ.P. 52.01. But we do not defer to the district court's decision on a question of law. Frost-Benco Elec. Ass'n v. Minnesota Pub. Utils. Comm'n , 358 N.W.2d 639, 642 (Minn. 1984).
1. Berg argues the district court erred in ordering only the return of the parts in Gohlike's possession. We agree. In a replevin action,
where the prevailing party is not in possession of the property, judgment must be entered in the alternative for the possession of the property or for its value where recovery is not possible.
Bogestad v. Bothum , 248 Minn. 198, 202, 79 N.W.2d 371, 375 (1956). The district court should have ordered Gohlike to return all the parts taken from Berg's shop or to pay damages. We reverse this part of the damage award and remand to allow the district court to enter such an order.
Gohlike admitted at trial that he no longer has all the parts taken from Berg's shop. In a replevin action,
[i]f possession cannot be obtained of the whole of such property but may be obtained for part thereof then the party entitled thereto may have possession of the part which may be obtained and recover the value of the remainder or may elect to take judgment for the value of the whole of such property.
Minn. Stat. § 548.04 (1994). On remand, the district court also must determine the value of any parts taken from Berg's shop that are no longer in Gohlike's possession.
Berg also argues that the district court erred in determining that the entire engine was worth $75,000 because this figure was calculated using the reserve price of the Cabriolet C rather than its fair market value. We agree. The proper measure of damages in a replevin action generally is "the fair, reasonable market value of the goods at the time of the taking." Schmalz v. Maxwell , 354 N.W.2d 549, 552 (Minn.App. 1984). Fair market value is "[t]he amount at which property would change hands between a willing buyer and a willing seller." Black's Law Dictionary , 597 (6th ed. 1990). A reserve price, however, is "[t]he price fixed and announced as the minimum at which property will be sold at an auction." The American Heritage Dictionary of the English Language 1535 (3d ed. 1992). The minimum price that a seller is willing to accept for an item at auction is not always the price that a buyer is willing to pay for the item. Further, the reserve price offered by an auction house is not always accepted by a seller. Because the district court here made no findings showing it had determined that the reserve price offered for the Cabriolet C also was its fair market value, the court's valuation of the engine was not based on fair market value. We reverse the $75,000 damage award and remand to allow the district court to determine the fair market value of the engine.
2. Gohlike argues the district court should have awarded him benefit of the bargain damages, rather than lost commission damages, because Berg breached an exclusive sales agreement. See Kalwitter v. Billick , 308 Minn. 325, 333, 242 N.W.2d 588, 594 (1976) (when action is for breach of exclusive sales agreement, damages are for breach of contract rather than for lost commission). But the parties' contract allowed either Berg or Gohlike to sell the cars and therefore was not an exclusive sales agreement. The cases cited by Gohlike do not apply, and the district court properly awarded him lost commission damages.
Gohlike also argues the district court erred in not awarding him damages for the parts he installed on the SSK, which were sold with the car. But the parties' agreement provided that Gohlike would install those parts on the SSK at his own expense. Given this language, the district court did not err in determining that Gohlike was not entitled to damages for his SSK parts.