NJR of Woodbury, Inc., d/b/a Footprints Academy, Appellant, vs. Tom Woida, et al., Respondents.

NJR of Woodbury, Inc., d/b/a Footprints Academy, Appellant, vs. Tom Woida, et al., Respondents. A05-268, Court of Appeals Unpublished, December 13, 2005.

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (2004).

 

STATE OF MINNESOTA

IN COURT OF APPEALS

A05-268

 

NJR of Woodbury, Inc.,

d/b/a Footprints Academy,

Appellant,

 

vs.

 

Tom Woida, et al.,

Respondents.

 

Filed December 13, 2005

Affirmed

Kalitowski, Judge

 

Washington County District Court

File No. C9-04-3214

 

William M. Bradt, Hansen, Dordell, Bradt, Odlaug & Bradt, P.L.L.P., 3900 Northwoods Drive, Suite 250, St. Paul, MN 55112-6973 (for appellant)

 

Gregory M. Hanson, 2104 Hastings Avenue, Suite 270, Newport, MN 55055 (for respondents)

 

            Considered and decided by Shumaker, Presiding Judge; Kalitowski, Judge; and Hudson, Judge.

U N P U B L I S H E D   O P I N I O N

KALITOWSKI, Judge

In this breach of contract action, appellant-school challenges the district court's grant of summary judgment on the issue of damages, arguing that the district court erred in determining that the school had mitigated its damages by enrolling another child into the kindergarten program.  Respondent-parents challenge the district court's grant of summary judgment, arguing that the district court erred by (1) dismissing respondents' consumer fraud counterclaims; and (2) finding the childcare agreement to be a valid contract.  We affirm.

D E C I S I O N

On appeal from summary judgment, this court determines (1) whether there are any genuine issues of material fact; and (2) whether the district court erred in its application of the law.  State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).  The party resisting summary judgment "must do more than rest on mere averments."  DLH, Inc. v. Russ, 566 N.W.2d 60, 71 (Minn. 1997).  A genuine issue for trial must be established by "substantial evidence."  Id.at 70.  A district court should grant a motion for summary judgment only "when the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue of material fact and that either party is entitled to a judgment as a matter of law." Fabio v. Bellomo, 504 N.W.2d 758, 761 (Minn. 1993).  A reviewing court views the evidence "in the light most favorable to the party against whom judgment was granted."  Id. 

I.

The district court granted summary judgment to appellant, NJR of Woodbury, Inc., holding respondents had breached an enrollment contract.  The district court set the damage amount at one year's tuition, the contractually agreed upon amount.  The district court then reduced that amount to zero, reasoning that appellant had completely mitigated its damages on the enrollment contract by enrolling another child into the kindergarten class.

Respondents presented the issue of mitigation of damages to the district court.  In response, appellant argued that although another student had enrolled, it lost profits on the enrollment contract made with respondents, because it would have accepted the additional student even if respondents had not breached the contract.

A breach of contract generally entitles the injured party to damages.  Restatement (Second) of Contracts § 346 cmt. a (1981).  This court will not disturb a damages award unless the "failure to do so would be shocking or would result in plain injustice."  Hughes v. Sinclair Mktg., Inc., 389 N.W.2d 194, 199 (Minn. 1986).  We review the district court's damages award only for an abuse of discretion, Dallum v. Farmers Union Cent. Exch., Inc., 462 N.W.2d 608, 614 (Minn. App. 1990), review denied (Minn. Jan. 14, 1991), and must view the evidence in the light most favorable to the award set.  Rayford v. Metro. Transit Comm'n, 379 N.W.2d 161, 165 (Minn. App. 1985), review denied (Minn. Feb. 14, 1986).

            The general measure of expectation interest damages for the injured party is the loss of value of the other party's performance, plus any other loss caused by the breach, less any cost or other loss avoided by not having to perform.  Restatement (Second) of Contracts § 347 (1981).  An injured party must use reasonable diligence to minimize or mitigate his or her damages.  Lanesboro Produce & Hatchery Co. v. Forthun, 218 Minn. 377, 381, 16 N.W.2d 326, 328 (1944); Deutz-Allis Credit Corp. v. Jensen, 458 N.W.2d 163, 166 (Minn. App. 1990).  The breaching party has the burden of proving that damages could have been mitigated.  Forthun, 218 Minn. at 381, 16 N.W.2d at 328.  

On appeal, appellant argues that the record does not support the district court's conclusion that the student who enrolled after the breach would not have been enrolled but for the breach.  Appellant also argues that because there is a material issue of fact in dispute regarding mitigation of damages, the district court erred in granting summary judgment on damages.  We disagree.

To prove mitigation of damages, respondents provided evidence that another child had been accepted into kindergarten shortly after respondents informed appellant that their daughter would not be attending kindergarten there.  Respondents also provided evidence that appellant had turned down students who had applied for admission to the kindergarten class. 

Appellant admitted it accepted another student after the breach.  But on appeal, appellant disputed that the student was accepted only because respondents' daughter withdrew and argued that there could have been many possible reasons for not accepting the two applicants.  But appellant's reasons for turning down the applicants were not on the record for the district court to consider.  And the record indicates that appellant refused to answer an interrogatory about students admitted and denied admittance to kindergarten, on the ground that it was irrelevant. 

            The issue of mitigation of damages was properly presented to the district court.  Respondents presented evidence of mitigation, which appellant failed to rebut.  A party "resisting summary judgment must do more than rest on mere averments."  DLH, Inc. v. Russ, 566 N.W.2d 60, 71 (Minn. 1997).  We therefore conclude that on this record the district court did not abuse its discretion in determining that appellant had mitigated its damages.

II.

 

            By notice of review, respondents argue that the district court erred in granting summary judgment to appellant on respondents' claim that appellant engaged in false advertising, deceptive trade practices, and made negligent and fraudulent misrepresentations that induced them to enter into the enrollment contract.  We disagree. 

Minnesota consumer protection statutes arguably protect individuals seeking educational services.  See generally Alsides v. Brown Inst., Ltd., 592 N.W.2d 468, 475 (Minn. App. 1999) (holding that educational services fall within the scope of Minnesota's Uniform Deceptive Trade Practices Act).  To sustain their claim under the consumer fraud act, respondents had the burden of proving that appellant intentionally made false promises or misrepresentations.  Id. at 474.  Respondents rely on appellant's print advertisements and the parent handbook as proof of appellant's false promises and misrepresentations.  Specifically, respondents allege that they were pressured to sign the contract, and they were guaranteed a small kindergarten class of no more than 24 students, with a teacher to student ratio of 1:12.

1.         Class size and teacher to student ratio

The print advertisements in the record indicated that there was a "projected class size of 15 students."  The parent handbook indicated, "We anticipate a maximum class size of 24, with one teacher and one teaching assistant, for a ratio of 1:12."  We conclude that the district court correctly characterized the "projected class size" and the "anticipate[d] maximum class size" language as mere estimatesthat were not false promises, misleading, or deceptive.  Moreover, as the district court noted, at the time of respondents' repudiation, the final number of students was 26, leaving the final teacher to student ratio at 1:13, which was not a material deviation from the estimated amounts.

Appellant did make some promises in its parent handbook.  Appellant promised not to exceed a 1:15 teacher to student ratio, stating, "In kindergarten, we will maintain a maximum ratio of 1:15."  Appellant did not surpass that number, because the 26 kindergarten students accepted were divided into two separate classes of 13 students each.  Appellant also promised that "[c]lass sizes for kindergarten will be held at 24 for the 2003-2004 school year."  By representing the class sizes for kindergarten in the plural, appellant indicated that there could be more than one kindergarten class, each of which would not exceed 24 students.  Thus, by accepting 26 kindergarteners and splitting them into two classes of 13 each, appellant met its promise. 

2.         Limited space

The print advertisements indicated that space was "limited due to small class sizes."  The district court correctly found that encouraging parents to enroll soon because class size was limited was not a "high pressure" deceptive trade practice.  As discussed above, class size was limited to 24 kindergarteners in each classroom.  Appellant could have stopped enrolling applicants when the enrollees numbered 24.  Appellant's decision to enroll more students and split them into two classes did not mean they had unlimited space or large class sizes.  Respondents did not provide sufficient evidence to show that appellant illegally pressured them into signing the contract merely by indicating to them that space was limited.

As a matter of law, the evidence provided by respondents was insufficient to support an essential element of their prima facie case.  We conclude that the district court did not err in dismissing respondents' counterclaim. 

III.

 

Respondents contend the district court erred in rejecting their claim that the before- and after-school childcare agreement was not a valid contract, because (1) "NJR of Woodbury, Inc." was not a party to the childcare contract, so they could not bring the action; and (2) the document lacked a start date and a price.  We disagree.

Generally, actions must be brought in the name of the party in interest, so strangers to a contract cannot sue for a breach of the contract.  Minn. R. Civ. P. 17.01; N. Nat'l Bank v. N. Minn. Nat'l Bank, 70 N.W.2d 118, 123 (Minn. 1955).  But Minn. R. Civ. P. 17.01 states that:

No action shall be dismissed on the ground that it is not . . . in the name of the real party in interest until a reasonable time has been allowed after objection for ratification of commencement of the action by . . . the real party in interest; and such ratification . . . shall have the same effect as if the action had been commenced in the name of the real party in interest.

 

Here, appellant provided an affidavit of Nicole J. Robbins, the president of both NJR of Woodbury, Inc. and Peace of Mind Daycare, Inc., ratifying "NJR of Woodbury d/b/a Footprints Academy" as the real party in interest.  Because appellant was ratified as the party in interest, we conclude that the district court did not err in finding that appellant was a party to the childcare contract.

Finally, respondents made an unsupported argument that the childcare agreement was not a valid contract because it lacked a start date and a cost amount.  We decline to address allegations unsupported by legal analysis or citation.  Ganguli v. Univ. of Minn., 512 N.W.2d 918, 919 n.1 (Minn. App. 1997).

Affirmed.