Nancy S. Schneider, et al., Respondents,

This opinion will be unpublished and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
A18-0232

Nancy S. Schneider, et al.,
Respondents,

vs.

Merrill G. Oestreich,
Appellant,
Linda Oestreich, intervenor,
Appellant.

Filed September 10, 2018
Affirmed
Florey, Judge

Washington County District Court
File No. 82-CV-16-3220

David S. Kendall, Campbell Knutson, P.A., Eagan, Minnesota; and

Mark J. Vierling, Eckberg & Lammers, P.C., Stillwater, Minnesota (for respondents)

Joel M. Anderson, White Bear Lake, Minnesota (for appellants)

Considered and decided by Ross, Presiding Judge; Reyes, Judge; and Florey, Judge.
U N P U B L I S H E D O P I N I O N
FLOREY, Judge
After a series of nonpayments under the terms of a contract fo r deed, respondents
served appellants with a notice of cancellation of the contract for deed. Appellants filed a
motion to enjoin that notice, which the district court denied. Appellants appealed, arguing

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respondents’ cancellation notice failed to comply with statutory requirements and that the
district court abused its discretion by denying their motion for injunctive relief. We affirm.
FACTS
The parents of appellant Merrill G. Oestreich (Merrill G.) and respondents, Craig
R. Oestreich and Nancy Schneider (respondents), executed a trust in December 2005. The
trust designated the parents as the first trustees and initial beneficiaries, and the parents
transferred their interest in their homestead property (the property) to the trust.
The siblings’ father died in December 2008, and their mother be came the sole
trustee and beneficiary. In January 2010, the siblings’ mother executed a codicil to her will
in which she referenced a contract for deed that allegedly tran sferred the trust property to
appellants Merrill G. and his wife, Linda Oestreich. The codicil also contained a provision
stating that any “outstanding balance of any unpaid financial o bligations of Merrill G.”
owed to the mother at her death were “hereby devised, forgiven and bequeathed solely to
Merrill G.” by operation of the trust and the contract for deed. The referenced contract for
deed was never recorded.
Sometime in August or September 2011, the siblings’ mother exe cuted a second
contract for deed that transfe rred the property to appellants u nder the following terms:
(1) appellants were to pay the trust the purchase price of $345 ,000 with $17,200 prepaid;
(2) the remaining balance was to be paid in monthly installment s of $800; and (3) the
outstanding principal would accrue interest at 3.25% annual percentage rate (APR).

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The trust would convey marketable title to the property to appellants once these terms were
satisfied. This second contract for deed was recorded. The mother died in May 2016 and
Merrill G. became the successor trus tee. Each of the siblings then had a one-third
beneficiary interest in the trust.
Just before Merrill G. became trustee, he told respondents that he was not making
the monthly $800 payments to the trust. Respondents filed suit against appellants in July
2016. The lawsuit intended to clarify multiple issues with the trust, including, what effect
their mother’s codicil had on the trust, the current ownership of the property, an accounting
of the trust, and removal of Merrill G. as the successor truste e. Appellants countersued
and argued that various services and work on the property—both before and after the
mother’s death—should apply as an in-kind credit to offset the financial obligations under
the contract for deed. While litigation was underway, Merrill G. recorded a trustee’s deed
conveying the property to himself and his wife pursuant to the second contract for deed.
Respondents filed a motion for summary judgment which the dist rict court granted.
The district court found that the express terms of the second contract for deed required cash
payments and the trust’s bank records showed that neither the $17,200 prepayment nor any
of the monthly $800 installments were received. The district c ourt determined that the
mother’s codicil did not modify the trust and that title to the property remained within the
t r u s t s u b j e c t t o t h e t e r m s o f t h e s e c o n d c o n t r a c t f o r d e e d . T he district court rescinded
Merrill G.’s trustee’s deed conveying the property to himself a nd his wife and then
removed Merrill G. as trustee. The district court dismissed with prejudice all of appellants’

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counterclaims on the merits. Judgement was entered on January 4, 2017. Appellants did
not appeal.
On September 26, 2017, the trus t served appellants with a notice of cancellation of
the second contract for deed based on appellants’ failure to pay any amount due under the
contract. The notice of cancellation described the default as follows:
Failure to pay the prepayment due and payable on or
before September 30, 2011, namely, a prepayment in the
amount of $17,200; and
[f]ailure to pay any of the $800 per month payments due
the first day of each month after September 30, 2011 currently
at $57,600; and
[f]ailure to pay any contractual interest on all unpaid
balances, with the full outstanding principal amount of
$345,000 accruing interest at 3.25% APR since September 30,
2011.

The notice informed appellants that the contract for deed would be cancelled within 60
days unless the breach was cured.
Appellants filed a motion for a temporary injunction to stay th e cancellation on
November 2, 2017. Appellants agai n argued that they performed various services on the
property that should be applied as an in-kind credit towards the payment obligations under
the contract. The district court denied the motion since the e xpress terms of the contract
required cash payments—not services for cash and because appell ants were unlikely to
succeed on the merits of their claim. Appellants appealed.

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D E C I S I O N
I. Appellants’ case is not ba rred under the rules of appellate procedure.

As a preliminary matter, respondents argue that appellants did not comply with
Minn. R. Civ. App. P. 108.02, which bars their appeal. Rule 108.02, subdivision 1, requires
a party seeking an order granting an injunction while an appeal is pending pursuant to
Minn. R. Civ. P. 62.02 to first move for the injunction at the district court. Rule 108.02
further provides:
[A] trial court may grant the relief described in subdivision 1
of this rule if the appellant provides security in a form and
amount that the trial court approves. The security provided for
in this rule may be in one instrument or several. The appellant
m u s t s e r v e p r o o f o f t h e s e c u r i t y i n a c c o r d a n c e w i t h R u l e
125.02.

Minn. R. Civ. App. P. 108.02, su bd. 2. The essence of responde nts’ argument is that
appellants did not provide the security and required proof under subdivision 2.
Respondents previously raised t his issue to this court, and we rejected this argument
because the “appellate rules explain how to seek a stay pending appeal, but do not require
an appellant to seek such relief.” Respondents’ confusion appears to stem from their belief
that the district court’s denial of appellants’ motion for temp orary injunction triggers
appellate rule 108.02. It does not. It is the injunction pending appeal under Minn. R. Civ.
P. 62.02 resulting from the denial of a temporary injunction th at implicates appellate rule
108.02. Because there was no request for an injunction pending appeal in this case, Minn.
R. Civ. App. P. 108.02 is inapplicable.

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II. Appellants forfeited their cl aim regarding compliance with statutory notice
requirements.

Appellants argue that respondent s’ notice of cancellation of th e contract for deed
failed to comply with statutory notice requirements. However, appellants did not raise this
issue in the district court when arguing for the temporary injunction. Parties on appeal are
bound by the theories actually tried in the district court, no matter how erroneous or careless
those theories were. Annis v. Annis, 84 N.W.2d 256, 261 (Minn. 1957). Appellate courts
generally do not consider matters not argued to and considered by the district court. Thiele
v. Stich, 425 N.W.2d 580, 582 (Minn. 1988).
In their motion for a temporary injunction, the document that l ed to this appeal,
appellants did not complain about the adequacy of the cancellat ion notice. Instead,
appellants appear to reargue the conclusions contained in the c ourt’s previously issued
summary-judgment order. We are unable to find anything in the record indicating that
appellants raised the issue in their motion for an injunction t hat concerned procedural
defects in respondents’ notice of cancellation. Further, couns el for appellants at oral
argument was unable to direct th is court to anywhere in the rec ord where this issue was
addressed in the district court. For this reason, we conclude the appellants are raising this
issue for the first time on appeal, and we decline to address the merits of the issue.

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III. The district court did not abuse its discretion by denying appellants’ motion
for a temporary injunction.

Appellants argue that the district court abused its discretion by denying their motion
to enjoin respondents’ notice of cancellation under Minn. Stat. § 559.211, subd. 1 (2016).1
Temporary injunctive relief is available under section 559.211 subdivision 1, “subject to
the requirements of rule 65 of the Rules of Civil Procedure for the District Courts.”
Under rule 65, district courts h ave broad discretion to grant o r deny a temporary
injunction, and this court will re verse only for abuse of that discretion. U.S. Bank Nat’l
Ass’n v. Angeion Corp. , 615 N.W.2d 425, 434 (Minn. App. 2000), review denied (Minn.
Oct. 25, 2000). In deciding whe ther to issue a temporary injun ction, courts consider the
following five factors: (1) the p reexisting relationship betwee n the parties; (2) the harm
that would result if the injunction were denied or issued; (3) the public policy of granting
or denying the injunction in light of the facts; (4) any administrative burdens in the judicial
oversight and enforcement of the i njunction; and (5) the likeli hood that one party or the
other will prevail on the merits. Dahlberg Bros. v. Ford Motor Co., 137 N.W.2d 314, 321-
22 (Minn. 1965). A district court’s factual findings in its co nsideration for an injunction
will not be set aside unless they are clearly erroneous. LaValle v. Kulkay, 277 N.W.2d 400,
402 (Minn. 1979).

1 Importantly, this appeal does not arise from the district court’s order granting summary
judgment to respondents. That judgment was entered on January 4, 2017, and became final
60 days later. See Minn. R. Civ. App. P. 104.01, subd. 1 (providing that “an appea l may
be taken from a judgment within 60 days after its entry” unless a different time is specified
by statute). Once the 60-day limit expires, the judgment becom es final—meaning that it
is no longer appealable and the district court’s jurisdiction t o amend the judgment is
terminated. Mingen v. Mingen, 679 N.W.2d 724, 727 (Minn. 2004).

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A. Preexisting relationship

“A temporary injunction is an extraordinary equitable remedy, and its purpose is to
preserve the status quo until ad judication of the case on the m erits.” Pac. Equip. &
Irrigation., Inc. v. Toro Co. , 519 N.W.2d 911, 915 (Minn. App. 1994), review denied
(Minn. Sept. 16, 1994). The district court found that the appe llants’ arguments for the
temporary injunction were identical to those giving rise to its previous summary-judgment
order. Although it did not say the status quo would be preserved, the district court implied
this result when it noted that appellants brought their injunction motion “weeks before the
cancellation” of the contract for deed, and that the court did not see a need to issue an
injunction “in order to give [appellants] the opportunity to have these claims addressed at
this late juncture.” We agree with the district court that den ying appellants’ motion did
little to change the parties’ exis ting relationship at the time , and we conclude the district
court’s findings were not clearly erroneous.
B. Potential harm

Standing alone, failing to show irreparable harm is generally e nough to deny a
temporary injunction. Morse v. City of Waterville , 458 N.W.2d 728, 729 (Minn. App.
1990), review denied (Minn. Sept. 28, 1990). And while appellants must show “irreparable
harm to trigger an injunction,” respondents only need to show “substantial harm to bar it.”
Pac. Equip. & Irrigation., Inc., 519 N.W.2d at 915.
The district court relied on its previous summary-judgment finding that appellants
failed to pay any amount toward the contract for deed. It found that in the abse nce of an
injunction, respondents would have a right to regain possession of the property. “For each

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month that the buyer has not made the required payment,” the di strict court wrote, “the
seller suffers additional damages.” This harm would be compounded if an injunction were
put in place because respondents could not attempt to mitigate their damages. The district
court reasoned that there was “simply no reason to compound [re spondents’] plight” by
depriving them of “possession and control by issuing an injunct i o n . ” W e a g r e e . T h e
contract for deed re quired appellants to make an initial paymen t and monthly payments,
something that had not yet occurred at the time of the district court’s decision. Allowing
appellants to continue nonpayment exacerbated the harm to respondents. We conclude the
district court’s findings regarding potential harm were not clearly erroneous.
C. Public policy

The district court found that t he claims in the injunction moti on were already
decided in the summary-judgment decision and appellants “have known since at least June,
2017, that the Trust intended to sell the Property.” The court concluded that finality of
these claims and alleviating the administrative burdens involve d in further judicial
oversight weighed against issuing the injunction. Again, we ag ree. The district court
settled these claims prior to a ppellants’ injunction motion and public policy cautioned
against allowing the district court to referee the claims again ; the district court did not
clearly err in its findings.
D. Likelihood of success

The likelihood that one party will succeed on the merits is the most important factor
in the Dahlberg analysis. Softchoice, Inc. v. Schmidt, 763 N.W.2d 660, 666 (Minn. App.
2009). The district court conclu ded appellants were unlikely t o succeed on the merits

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because the claims in their injunction motion were already heard on the merits, and decided
against them with prejudice, in the court’s summary-judgment order.2
In their motion for a temporary injunction, appellants claimed that their “credits”—
that is, services appellants made to the property in upkeep and more—likely totaled more
than the purchase price of the contract for deed. Given this p ossibility, appellants argued
that the notice of cancellation’s demand for the full amount of the contract was inequitable
without completing an accounting of these “credits.” The distr ict court rejected this
argument because it is “the legal nature of a contract for deed that the buyer on a contract
for deed is allowed to occupy the property and is required to k eep it up.” The court went
on to explain that buyers in a contract for deed run the risk that they could lose all contract
payments and investments if the contract is cancelled. This is not inequitable, the court
concluded, because any improvements made by a purchaser in a co ntract for deed “are
made solely at their own risk, to which they benefit if they co mplete the transaction, and
to which they lose if they do not.”
The district court also reitera ted that the plain language of the contract for deed did
not allow in-kind credits to subs titute for payment. The distr ict court found the contract
language required “payment of cash” to the trust, and that it w as “undisputed that
[appellants] have made no cash payments” required under the contract for deed. We have

2 As to the possibility that some of appellants’ arguments might involve new allegations,
specifically, that certain servi ces provided by appellants to M errill G.’s mother and the
property should offset the contract price, the district court concluded any such claims were
improper because they “must be raised in a new lawsuit, properly served and filed pursuant
to the Rules of Civil Procedure.”

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said that a “clear and unambigu ous contract is enforced in acco rdance with the plain
language of the contract.” Terminal Transp., Inc. v. Minn. Ins. Guar. Ass’n , 862 N.W.2d
487, 489 (Minn. App. 2015), review denied (Minn. June 30, 2015). The district court
concluded that based on the express language of the contract al one, appellants’ services
could not be used as a credit to offset the contract price.
Based on our review of the record, we do not believe the district court clearly erred
in these findings. Appellants’ injunction claims are similar, if not identical, to their
summary-judgment claims, which were decided against them and became final before their
injunction motion. And even if these claims were properly before the district court for the
first time in the injunction motion, they would likely fail on the merits because the express
contract language requires cash payments, and the very nature o f a contract for deed
assumes the risk that improvements to property could be lost in a cancellation. For all these
reasons, we conclude the district court did not abuse its discr etion by denying appellants’
motion for temporary injunction.
Affirmed.