Rasminde, LLC, Respondent,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2016).

STATE OF MINNESOTA
IN COURT OF APPEALS
A16-1939

Rasminde, LLC,
Respondent,

vs.

Hutchinson Properties, LLC,
Appellant,

Citizens Bank & Trust Co., Hutchinson, MN,
Defendant.

Filed May 22, 2017
Affirmed
Bjorkman, Judge

McLeod County District Court
File No. 43-CV-15-668

Nathan R. Sellers, Fabyanske, Westra, Hart & Thomson, P.A., Minneapolis, Minnesota
(for respondent)

Curtis M. Bradford, Bradford Law Office, Ltd., Hutchinson, Minnesota (for appellant)

Considered and decided by Bjorkman, Presiding Judge; Hooten, Judge; and Reyes,
Judge.

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U N P U B L I S H E D O P I N I O N
BJORKMAN, Judge
After a bench tr ial in this dispute concerning payment for architectural services ,
appellant argues that the district court clearly erred in not finding that the parties ’ oral
contract conditioned appellant’s payment obligation on actual construction. We affirm.
FACTS
Appellant Hutchinson Properties, LLC owns the Hotel Jorgensen (the property) in
Hutchinson, Minnesota. In 2011, Hutchinson co-owner Jeff Haag met with Steve Jensen,
the owner of respondent Rasminde, LLC, to discuss possible redevelopment of the
property. The parties agreed that Rasminde would provide architectural services in
connection with the project; they did not reduce the agreement to writing.
Over the next two and a half years, Jensen created and provided Hutchinson with
plans for various potential uses of the property, including apartments, office space, and a
hotel. Jensen recorded 144 hours of work on the project from December 2011 through June
2012; 633.5 hours from January 2013 through June 2013; 58.5 hours from November 2013
through March 2014; and 20 hours from April 2014 through May 2014. The parties dispute
how much money Hutchinson paid Rasminde and whether it was in the form of progress
payments. But Hutchinson admits paying Rasminde $5,000 in 2013 for work performed
on the project. In May 2014, Rasminde concluded that “the nature of the project and the
construction date ha[ve] become uncertain” and submitted a final bill totaling $84,650.1

1 Construction did not occur.

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Haag refused to pay , advising Jensen by e -mail that the bill “caught [him] totally
off guard.” In June 2014, Rasminde recorded a mechanic’s lien in the amount of $84,650.
Nearly one year later, Rasminde commenced this action, alleging entitlement to payment
on the lien, and damages based on breach of contract and unjust enrichment. Hutchinson
interposed an answer and counterclaim, denying the existence of a contract or other
obligation to pay and alleging slander of title. At some point during the litigation, Jensen
discovered an accounting error and filed a partial satisfaction, reducing the lien amount to
$75,600.
The parties agreed to submit the case to t he district court for a bench trial . The
evidence focused on whether the parties’ oral contract conditioned Hutchinson’s
responsibility to pay for architectural services on actual construction of the redevelopment
project. It was undisputed that the parties entered into an oral contract and that Rasminde
provided the services reflected in its bill. Haag admitted that Rasminde performed some
of the work at his direction and does not dispute that he periodically discussed the project
with Jensen. Both Haag and Jensen acknowledged that they did not discuss an hourly rate
for Rasminde’s s ervices.2 But the two gave conflicting testimony concerning whether
Hutchinson’s responsibility to pay was contingent on the project’s construction.
Haag testified that the only discussion of fees occurred after they received proposals
from a few contractors. At that point, Haag asked Jensen for the percentage of architectural
fees to be charged, to which he never received a definitive answer. And Haag stated that

2 On appeal, Hutchinson does not dispute that Rasminde’s $100 hourly rate is reasonable.

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it was clear to both parties “all along” that compensation was “subject to the project going
forward” and being formalized.
Jensen testified that the parties’ agreement did not condition payment on
construction of the project. He noted that he would not track his hours as he did here if a
project called for a fixed fee, such as a percentage of the overall project costs . Jensen
testified that contingent agreements are unusual in the context of architectural services, and
would be in writing.
The district court found that (1) the parties entered into a contract, (2) Rasminde
performed the recorded services, (3) Rasminde’s customary rate for architectural services
is $100 per hour, and (4) the evidence does not s upport a finding of a contingent
compensation agreement. And the district court concluded that even if no contract existed,
Rasminde was entitled to payment on its mechanic’s lien pursuant to Minn. Stat. § 514.06
(2016).
Hutchinson appeals, but does not challenge the district court’s findings of fact or
conclusions of law as to the mechanic’s lien.
D E C I S I O N
“Findings of fact, whether based on oral or documentary evidence, shall not be set
aside unless clearly erroneous, and due regard shall be given to the opportunity of the
[district] court to judge the credibility of the witnesses.” Minn. R. Ci v. P. 52.01; see also
Fletcher v. St. Paul Pioneer Press , 589 N.W.2d 96, 101 (Minn. 1999) (“On appeal, a
[district] court’s findings of fact are given great deference, and shall not be set aside unless
clearly erroneous.”).

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[W]e examine the record to see if there is reasonable evidence
in the record to support the [district] court’s findings. And
when determining whether a finding of fact is clearly
erroneous, we view the evidence in the light most favorable to
the verdict. To conclude that findings of fact are clearly
erroneous, we must be left with the definite and firm conviction
that a mistake has been made.

Rasmussen v. Two Harbors Fish Co., 832 N.W.2d 790, 797 (Minn. 2013) (quotations and
citations omitted).
Hutchinson challenges the district court’s finding that the parties ’ oral agreement
did not condition Rasminde’s compensation for architectural design services “on the
building of the proposed project. ” Hutchinson argues that the district court’s rejection of
its contingent -compensation evidence reflects clear error. Specifically, Hutchinson
contends that Jensen’s testimony is undermined by the “o bjective evidence ,” including
Rasminde’s failure to submit more than two invoices over the term of its work, its
continued work in the absence of payment, and its failure to send past-due notices. We are
not persuaded.
First, Hutchinson’s argument invites us to second -guess the district court’s
credibility determinations. In addition to reviewing documentary evidence, the district
court weighed the c onflicting testimony of both Jensen and Haag. It found Jensen’s
explanations of the parties’ behavior to be more credible, and relied on that testimony as
grounds for its determination that compensation was not contingent on actual construction
of the project. It is not our role to reconcile conflicting evidence; we generally defer to a
district court’s credibility determinations and discern no reason to do otherwise in this case.
Minn. R. Civ. P. 52.01; Fletcher, 589 N.W.2d at 101.

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Second, we are not convinc ed that what Hutchinson calls “objective evidence”
renders the district court’s challenged findings of fact clearly erroneous.
Hutchinson contends that the lack of invoices objectively demonstrates that the
parties entered into a contingent compensation agreement. We disagree. Jensen testified
that he understood the parties’ arrangement to include a grace period, then progress
payments based on his hourly rate. The record reflects that Rasminde first sent an invoice
to Hutchinson in June 2012, which su pports Jensen’s testimony regarding a grace period.
The invoice included 144 hours of work completed from December 2011 through June
2012. Though Haag initially testified that he never saw the invoice, he ultimately
acknowledged that he may have received it. Rasminde submitted another invoice and
requested payment in the spring of 2014. The timing and work reflected in the invoices
correspond with Rasminde’s completion of substantial sub-projects, supporting Jensen’s
testimony regarding progress payments and rebutting Hutchinson’s argument that the
objective evidence undermines Jensen’s testimony.
Hutchinson next argues that Rasminde’s continued work in the absence of payment
supports a finding of a contingent compensation agreement. But Jense n testified that
Hutchinson paid $10,000 in the spring of 2012 and $5,000 in the spring of 2013 . The
district court found that half of the 2012 payment went toward the hotel project and half
toward an unrelated project. Hutchinson provides no support for his contention that this
payment was solely related to a different project. And Haag admits making a $5,000
payment in 2013. Like the invoices, these payments coincide with completion of sub -
projects and therefore support the progress-payment theory.

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Finally, Hutchinson suggests that the lack of past-due notices is objective evidence
that a contingent compensation agreement existed. But, as noted above, Jensen explained
that the parties agreed Rasminde could submit invoices after a grace period and t hat
Hutchinson would then make progress payments. And the record demonstrates such
payments were made at fairly regular intervals.
Ultimately, Hutchinson’s appellate arguments mirror the arguments the district
court rejected—that the behavior of the part ies sup ports a finding of a contingent
compensation agreement. We are not persuaded that the evidence before the district court
only supports Hutchinson’s theory. And we decline the implicit invitation to reweigh the
testimony and documentary evidence. In sum, we discern no clear error in the district
court’s findings of fact. And w e are not left with the definite and firm convicti on that a
mistake has been made.
Affirmed.