George Scott Register

In this declaratory judgment action, the plaintiff insurance company sought a ruling that it had no duty to defend or indemnify its insured, Gibbons, in a lawsuit brought by Lesselyoung for injuries sustained when a bullet fired from a rifle resting on the insured vehicle ricocheted and struck Lesselyoung. The court, applying North Dakota law, held that the injury did not arise out of the "use" of the automobile as contemplated by the policy's insuring clause. The reasoning focused on the policy language requiring the injury to arise from the ownership, maintenance, or use of the vehicle in its inherent nature as an automobile, rather than its incidental use as a gun rest.

torts & liabilitybusiness & regulatory

This case involved a petition by an IRS Special Agent to enforce two summonses served on respondent Orser, a CPA, seeking production of workpapers, records, and documents related to amended tax returns prepared for taxpayers Kenneth and Lois Peterson for the years 1960-1963. The court denied enforcement of the summonses. The undisputed facts showed that Orser had been retained by the Petersons' attorney, Vogel, to assist in representing the clients, that the underlying records remained the property of the Petersons, and that the taxpayers had expressly asserted their Fifth Amendment privilege against self-incrimination regarding disclosure of those materials. Because the documents were in the lawful possession of their owners rather than a third party, and Orser had no lawful means to obtain them against the owners' consent, an enforcement order would have been improper and unenforceable.

taxescriminal lawfederal powerprocedure

In this case, plaintiff White, an employee of Noble Drilling Company, was injured on the job and received workers' compensation benefits under North Dakota law before suing McKenzie Electric Cooperative and others in tort for his injuries. McKenzie then filed a third-party complaint against Noble seeking indemnity or contribution, alleging Noble's negligence in violating safety rules or that its own negligence was merely passive compared to Noble's active negligence. The court granted Noble's motion to dismiss the third-party complaint. The decision rested on the North Dakota Workmen’s Compensation Act, which the court interpreted as providing an exclusive remedy that bars all other claims against a complying employer like Noble, including those for indemnity or contribution by third parties, since there is no common liability or contractual relationship allowing such recovery.

labor & employmenttorts & liability

This case concerned a claim for refund of 1956 federal income taxes paid by shareholders of a corporation that sold substantially all its assets. Under Section 337(a) of the 1954 Internal Revenue Code, no gain or loss is recognized to the corporation if it adopts a plan of complete liquidation and distributes its assets within 12 months. The sale occurred on February 14, 1956, but the formal shareholder resolution adopting a liquidation plan was not passed until November 23, 1956. The court held that the plaintiffs failed to prove a plan of complete liquidation had been adopted by the corporation before the sale, as pre-sale discussions among officers and shareholders reflected only conditional intentions dependent on the sale occurring, and the burden of proof rested on the plaintiffs. Judgment was entered for the defendant.

taxesbusiness & regulatory

This case was a federal lawsuit by a union against an employer under Section 301 of the Labor Management Relations Act to compel arbitration of four grievances alleging that the company violated their collective bargaining agreement by contracting out maintenance and operating work at a North Dakota refinery. The court ruled that the employer did not have to arbitrate the grievances and dismissed the suit. The core reasoning was that the agreement's arbitration provision in Article II, Section 8, expressly excluded proposals to modify or amend the contract and any matters arising from them, and the grievances amounted to attempts to alter the company's subcontracting practices, which the parties had deliberately left outside the arbitration process; the court applied Supreme Court precedent limiting judicial inquiry to whether the contract on its face covered the claims. The court found the exclusion clause plain and controlling, without reaching the merits of the underlying disputes.

labor & employment

This diversity jurisdiction case arose from a December 1958 collision on a North Dakota highway after defendant corporation's employee towed a disabled vehicle belonging to co-defendant Weisz using an improperly attached chain that caused the towed car to veer across the centerline into oncoming traffic, injuring plaintiff Gillis. After Weisz settled with Gillis, the court tried the remaining claims of negligence against the corporation, which had denied liability and asserted contributory negligence. The court found the corporation negligent for failing to ensure the towed vehicle tracked properly behind the tow truck, given the offset attachment points, power steering without power, cold weather, and known traffic conditions on the highway, and rejected contributory negligence. It awarded damages to both Gillis and Weisz, including the reasonable value of military-provided medical services under the modern rule allowing such recovery, and entered judgment accordingly.

torts & liability

The case involved a supplier's claim under the Miller Act (40 U.S.C. § 270b) against a prime contractor and its surety for an unpaid balance of $1,559.14 on materials and labor furnished to a subcontractor for electrical work at the Minot Air Force Base. The supplier had no direct written contract with the prime contractor, provided the last materials on February 23, 1959, and gave written notice to the prime contractor only on June 15, 1959—outside the statutory 90-day window. The court dismissed the claims, ruling that timely written notice stating the amount claimed is a mandatory condition precedent to any right of action on the payment bond, that no implied contract or third-party beneficiary status existed, and that actual knowledge, established invoicing procedures, or partial payments by the prime contractor did not waive or satisfy the statutory requirement.

business & regulatoryprocedure

This case involved a bankruptcy trustee challenging the validity of bonds and a related trust indenture executed by a corporation's promoters before the entity was formally incorporated in North Dakota, as well as whether certain equipment such as oil tanks constituted real property fixtures subject to the mortgage or unsecured personal property. The court held that the pre-incorporation actions, while noncompliant with statutory and constitutional requirements, were not void and could be ratified or adopted by the corporation after formation. It further determined that the equipment was personal property because it was not permanently affixed to the land, had been assessed and taxed as such by the corporation itself, and was readily removable. As a result, the trust indenture constituted a valid first mortgage on the corporation's real property but was void and ineffective against unsecured creditors with respect to the personal property.

business & regulatorypropertyprocedure

This case was a declaratory judgment action brought by Sunshine Mutual Insurance Co. to determine coverage under a liability insurance policy it issued on a 1949 Oldsmobile. The policy named Richard Mai as the insured and included an omnibus clause extending coverage to permissive users. The underlying facts involved a 1956 car accident in North Dakota in which Walter Mai was driving the insured vehicle and collided with a car owned by Arthur Peterson, injuring both Petersons. The court found that at the time of the accident Walter Mai was using the car solely for his own purposes without the express or implied permission of Richard Mai, who had left the vehicle with another family member. Accordingly, the court held there was no coverage under the policy and the insurer had no liability for any damages arising from the accident.

torts & liabilitybusiness & regulatory

This case involved landowners suing the United States under the Federal Tort Claims Act and a private law for damages to their farmland, fences, buildings, and crops allegedly caused by a government-built dike on adjacent property that protected a federal nursery project. The court ruled for the defendant after finding that the dike contributed only partially to some flooding effects but that the major, substantial damages stemmed from periodic natural floods that would have occurred anyway. Plaintiffs' evidence of specific proximate damages was deemed insufficient, as it was not limited to the claimed years, failed to isolate the dike's effects from other factors like prior floods and silt accumulation, and relied on speculative calculations rather than reasonably certain proof.

torts & liabilitypropertyfederal power

This case involved a railroad company suing the consignee of an interstate shipment of roofing slabs to recover unpaid freight charges under the Interstate Commerce Act. The court granted the plaintiff's motion for summary judgment against the individual defendant, finding him liable for the full freight amount. The core reasoning was that the bill of lading contained a non-recourse clause signed by the shipper, which under federal law shifted liability for charges to the consignee upon delivery, and the defendant's claims regarding damaged goods were barred because no timely damage claim was filed and no counterclaim was pleaded.

business & regulatory

This case involved a dispute over title to North Dakota farmland and associated mineral rights. Otto Tveter executed and recorded a warranty deed conveying the property to his children from his first marriage while reserving a life estate for himself, though the deed remained in his possession until litigation arose. He later executed an oil and gas lease to plaintiff Eide without the children's involvement. The court held that the recorded deed was validly delivered, as the grantor's actions and the presumption from recording established an intent to pass immediate title subject to the life estate, and that a life tenant lacks authority to grant a mineral lease without the remaindermen. Accordingly, the lease was declared void, and Eide was entitled to a refund of the lease payment.

property

This case was a declaratory judgment action brought by an insurance company against its policyholder and others involved in a car accident, seeking a ruling that the company's automobile liability policy did not cover the incident. The policy covered the named insured's Dodge truck and extended to temporary substitute vehicles used with permission when the truck was out of service. The accident occurred when an employee, McFall, drove his own Oldsmobile while on company business after the truck broke down. The court granted the insurer's motion for summary judgment, holding that there was no coverage because McFall lacked permission from the named insured to use the Oldsmobile, and this legal conclusion followed from undisputed facts under the policy language.

business & regulatorytorts & liabilityprocedure

This case involved a dispute over a 1950 Contract for Deed for land in North Dakota, where plaintiff Harold Metzler sought reformation of the contract, specific performance, and damages, claiming that a provision granting him 6% of 50% of the mineral rights did not reflect the parties' true agreement due to a mutual mistake about the defendant's ownership interest in the minerals. The court found that the written contract, which had been drafted by the plaintiff's attorney based on the defendant's prior offer, accurately expressed the parties' intentions at the time. The plaintiff failed to meet the burden of proving mutual mistake by clear, satisfactory, and convincing evidence, as the mistake concerned the extent of the defendant's mineral rights rather than an error in reducing the agreed terms to writing. Judgment was entered for the defendant.

propertyprocedure

This case involves the United States seeking recovery of unpaid 1950 premiums on wheat and flax crop insurance policies issued by the Federal Crop Insurance Corporation to defendant Shaw. The defendant denied liability, claiming he attempted to cancel the policies via oral requests to agents in late 1949 and early 1950, that agents assured him no further action was needed, and raising defenses of estoppel and usury on interest provisions. The court ruled for the plaintiff, granting judgment for the premiums due. It held that the policies expressly required written notice of cancellation by the December 31 deadline to terminate coverage for the following year, that paragraph 29 barred any waiver or modification except by authorized written action, and that equitable estoppel did not apply because the defendant possessed the policies, knew or should have known the terms, and had equal access to the facts.

business & regulatoryfederal power