Detmers v. Costner

#26104-a-DG

2012 S.D. 35

                          IN THE SUPREME COURT
                                  OF THE
                         STATE OF SOUTH DAKOTA

                                  ****

PEGGY A. DETMERS and
DETMERS STUDIOS, INC.,
a South Dakota Corporation,                Plaintiffs and Appellants,

      v.

KEVIN COSTNER and
THE DUNBAR, INC.,
a South Dakota Corporation,                Defendants and Appellees.


                                  ****

                  APPEAL FROM THE CIRCUIT COURT OF
                    THE FOURTH JUDICIAL CIRCUIT
                  LAWRENCE COUNTY, SOUTH DAKOTA

                                  ****

                    THE HONORABLE RANDALL L. MACY
                                Judge

                                  ****
ANDREW R. DAMGAARD
A. RUSSELL JANKLOW of
Janklow Law Firm, Prof. LLC
Sioux Falls, South Dakota                  Attorneys for plaintiffs
                                           and appellants.

KYLE L. WIESE
JAMES S. NELSON of
Gunderson, Palmer, Nelson & Ashmore, LLP
Rapid City, South Dakota                   Attorneys for defendants
                                           and appellees.

                                  ****
                                           ARGUED MARCH 19, 2012

                                           OPINION FILED 05/09/12
#26104

GILBERTSON, Chief Justice

[¶1.]        In 2008, Peggy Detmers and Detmers Studios, Inc. (collectively

“Detmers”) brought suit against Kevin Costner and The Dunbar, Inc. (collectively

“Costner”). The suit sought declaratory judgment regarding an agreement on the

placement of sculptures Costner had commissioned from Detmers. After a bench

trial, the court granted judgment in favor of Costner. Detmers appeals. We affirm.

                                       FACTS

[¶2.]        In the early 1990s, Costner envisioned building a luxury resort called

“The Dunbar” on property he owned near Deadwood, South Dakota. After

discussions, Costner commissioned Detmers to design 17 buffalo and Lakota

warrior sculptures, intending to display them at The Dunbar’s entrance. The

bronze sculptures are 25% larger than life-size and depict three Lakota warriors on

horseback pursuing 14 buffalo at a “buffalo jump.” Detmers and Costner orally

agreed that she would be paid $250,000 and would receive royalty rights in the

sculptures’ reproductions, which were to be marketed and sold at The Dunbar’s gift

shop. When The Dunbar had not been built in the late 1990s, Detmers stopped

working on the sculptures.

[¶3.]        After several months of negotiations, on May 5, 2000, Costner sent

Detmers a letter detailing an agreement that would provide her additional

compensation in exchange for completing the sculptures. Detmers agreed and

signed the letter as requested, creating a binding contract. As part of the

agreement, Costner paid Detmers an additional $60,000, clarified royalty rights on



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reproductions, and provided her certain rights regarding display of the sculptures.

Paragraph three of the agreement, which is at issue in this case, provides:

              Although I do not anticipate this will ever arise, if The Dunbar
              is not built within ten (10) years or the sculptures are not
              agreeably displayed elsewhere, I will give you 50% of the profits
              from the sale of the one and one-quarter life scale sculptures
              after I have recouped all my costs incurred in the creation of the
              sculptures and any such sale. The sale price will be at our above
              standard bronze market pricing. All accounting will be
              provided. In addition, I will assign back to you the copyright of
              the sculptures so sold (14 bison, 3 Lakota horse and riders).

[¶4.]         Paragraph four of the agreement provides: “We will locate a suitable

site for displaying the sculptures if The Dunbar is not under construction within

three (3) years after the last sculpture has been delivered to the mold makers.”

Because the resort was not under construction within three years after the last

sculpture had been delivered, Detmers and Costner began looking for display

locations as required by paragraph four. Detmers suggested locations in Hill City,

while Costner considered locations near Deadwood.

[¶5.]         On January 23 or 24, 2002, Costner called Detmers and they discussed

permanently placing the sculptures at a site on Costner’s property where he

intended to build The Dunbar.1 The project became known as “Tatanka.” Costner

hired landscape architect Patrick Wyss to design Tatanka. Costner instructed Wyss

to keep Detmers informed and involved in the design process. Detmers was


1.      During her deposition, Detmers initially denied that she received this phone
        call. After being confronted with telephone records, Detmers agreed Costner
        had called her. She then denied that Costner had suggested placement of the
        statutes at his Deadwood property during this call. During later questioning,
        she admitted that during the call he talked about The Dunbar location for the
        statutes.

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#26104

influential in the sculptures’ placement at Tatanka, including suggesting and

implementing wood “mock-ups” to predetermine the exact location of each

sculpture. Detmers, Costner, and Wyss were all present when the sculptures were

placed at Tatanka. Tatanka was funded solely by Costner and is a separate legal

entity from The Dunbar. In addition to the sculptures, Tatanka consists of a visitor

center, gift shop, café, interactive museum, and nature walkways. Both Detmers

and Costner spoke at Tatanka’s grand opening in June 2003, expressing

enthusiasm and pride in the attraction.

[¶6.]        In 2008, Detmers brought suit against Costner, seeking a declaratory

judgment that she did not agree to the placement of the sculptures as required by

paragraph three of their May 2000 contract. For relief, Detmers sought an order

requiring Costner to sell the sculptures with the proceeds dispersed consistent with

paragraph three. Detmers claimed that because The Dunbar had not been built

within ten years and the sculptures were not “agreeably displayed elsewhere,” she

was entitled to 50% of the proceeds from the sale of the sculptures.

[¶7.]        Before trial, Costner moved to use parol evidence. Detmers objected,

requesting a ruling that the May 2000 contract was unambiguous and parol

evidence was therefore inadmissible. The circuit court concluded that the May 2000

contract was unambiguous and denied Costner’s motion to admit parol evidence.

The sole issue at the bench trial was whether the sculptures were “agreeably

displayed elsewhere.” Costner, Detmers, and Wyss testified at trial.

[¶8.]        After post-trial briefing, the court granted judgment in favor of

Costner. The court maintained its earlier conclusion that the May 2000 contract

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was unambiguous. The court concluded that “‘[e]lsewhere,’ as used in the contract,

clearly means at a site other than The Dunbar.” Additionally, “[b]ecause The

Dunbar has not been built, any site is elsewhere, i.e., somewhere other than The

Dunbar. The placement of the sculptures at Tatanka is elsewhere.” The court also

concluded: “Detmers actions following the decision to place the sculptures at

Tatanka indicate that she agreed to display them at that location. . . .” Detmers

appeals.

                              STANDARD OF REVIEW

[¶9.]        “We will not set aside a trial court’s findings of fact unless they are

clearly erroneous.” Alto Twp. v. Mendenhall, 2011 S.D. 54, ¶ 9, 803 N.W.2d 839,

842. “[W]e review conclusions of law under a de novo standard, with no deference to

the trial court’s conclusions of law.” Id.

                                      ANALYSIS

[¶10.]       We restate and consolidate Detmers’ issues on appeal to whether the

circuit court erred in determining that the sculptures were “agreeably displayed

elsewhere,” as required under the contract. Under paragraph three, Detmers would

only be entitled to specific performance if The Dunbar was not built or the

sculptures were not “agreeably displayed elsewhere.” The issue at trial was

whether Detmers agreed to displaying the sculptures at Tatanka, which is a factual

inquiry. The circuit court concluded Detmers agreed, as demonstrated by her

conduct and actions, to permanent display of the sculptures at Tatanka.

[¶11.]       On appeal, Detmers does not dispute that she agreed to display the

sculptures at Tatanka. Instead, she asserts that she only agreed to the location

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because she had been promised or guaranteed that The Dunbar would still be built.

Detmers cannot point to anything in the record supporting this assertion other than

her own testimony. The circuit court found that Detmers was never promised or

guaranteed that the Dunbar would be built. Costner maintained throughout this

suit that he continues to attempt to build The Dunbar, but cannot promise it will

happen. Detmers has not shown any findings to be clearly erroneous.

[¶12.]       Furthermore, this action centers around a clause in the contract

addressing what would happen if the resort was not built. The contract itself

contemplates the possibility that The Dunbar might not be built. Detmers cannot

assert that she was not aware that The Dunbar’s future was questionable. Detmers

has not demonstrated that the circuit court’s finding was clearly erroneous. As to

Detmers’ argument that the finding was unnecessary, the court appeared to address

it because it was an issue raised by Detmers through questioning.

[¶13.]       Detmers asserts that to the extent the court used the testimony of

Patrick Wyss to find that Detmers had not been guaranteed The Dunbar would be

built, the court erred. The court found: “Testimony from Costner and others

associated with The Dunbar and Tatanka projects indicates that although Costner

has been attempting to build The Dunbar for years, and continues to try to build it,

he has never promised Detmers or anyone else that it would actually be built.”

(Emphasis added.) Presumably, Wyss is an “other[] associated with” the projects as

he was the only other person to testify besides Costner and Detmers.

[¶14.]       Wyss was prepared for trial by Costner’s counsel. He testified as a fact

witness, called adversely as part of Detmers’ case-in-chief. Wyss was sequestered,

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#26104

so he had not heard Costner’s testimony, given after being called adversely, or

Detmers’ testimony. Detmers’ counsel asked whether, during the time the

sculptures were being placed at Tatanka, “there was not only an understanding by

[Wyss] but an understanding by Peggy Detmers that the Dunbar resort was

ultimately going to be built.” Wyss responded “No.” Detmers’ counsel then

attempted to impeach Wyss with his deposition testimony where he was asked: “So

the placement of the monument back in 2002, there was always an understanding,

and it was being told to Peggy, that the Dunbar was still going to be built at that

time; right?” Wyss responded, “That was my understanding.”

[¶15.]       Detmers made a motion after trial to strike Wyss’ changed trial

testimony. The court denied the motion. Detmers argues that the court should not

have relied on Wyss’ testimony. A review of Wyss’ testimony reveals the context of

Wyss’ statements and his questioning. During Wyss’ deposition, counsel was

questioning Wyss on whether “the plan was still to build The Dunbar” when the

sculptures were being placed. The context of the questioning shows that Costner

and his team were still working towards building The Dunbar, and the placement of

Tatanka was important to ensure The Dunbar could go forward if investors

committed. Wyss explained at trial that “[t]he context of that conversation was the

planned hotel . . . .” He continued to emphasize that “there were efforts in place to

attempt to get the hotel built.”

[¶16.]       Wyss’ responses to Detmers’ “impeachment” questions provide the

necessary framework for understanding his answers. The circuit court was able to

witness Wyss and the questioning at trial to determine credibility and the weight

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#26104

that should be afforded his testimony. We will not second-guess that

determination. Even if the court did err in relying on Wyss’ testimony, Detmers has

not shown that the finding was clearly erroneous in light of the entire record

indicating that Detmers had no reason to assume The Dunbar would be built.

[¶17.]          Detmers also argues that the circuit court erred as a matter of law in

its construction of the term “elsewhere.” She asserts that “elsewhere” must be

somewhere other than the proposed site for The Dunbar. She suggests that the

circuit court’s conclusion rewrites the contract. Additionally, she argues that if

“elsewhere” is ambiguous, it should be construed against Costner. However,

Detmers asserted before trial, and the court agreed, that the contract was

unambiguous. That decision was not appealed.2

[¶18.]         The circuit court concluded as a matter of law that the regular

meaning of the term “elsewhere” applied. The court noted that Black’s Law

Dictionary defines elsewhere as “in another place, in any other place,” and

Webster’s Dictionary defined it as “in or to another place.” See Black’s Law

Dictionary 560 (8th ed. 2004). Accordingly, there must first be a designated place to

determine if somewhere is “another place.” Paragraph three provides: “if The

Dunbar is not built within ten (10) years or the sculptures are not agreeably

displayed elsewhere.” (Emphasis added.) The designated place is The Dunbar. The


2.       “Whether the language of a contract is ambiguous is . . . a question of law.”
         Pankratz v. Hoff, 2011 S.D. 69, ¶ 10 n.*, 806 N.W.2d 231, 235 n.*. Even if
         this Court were to decide that the contract was ambiguous, the language of
         the contract, in addition to the findings of the circuit court, support judgment
         for Costner.


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#26104

circuit court concluded that “elsewhere” meant at a place other than The Dunbar.

And because The Dunbar had not been built, Tatanka was elsewhere.

[¶19.]       Costner points out that the circuit court and Detmers both assign

“elsewhere” its ordinary meaning, i.e., “in another place.” The analysis diverges on

whether “in another place” means another place from The Dunbar itself or from The

Dunbar’s intended site. Costner asserts that the circuit court was correct in

concluding that “elsewhere” is in a place other than The Dunbar resort itself, which,

according to the language, must be built. The land could not be built, but the resort

could. Furthermore, the terms of the contract plainly do not say The Dunbar site.

[¶20.]       “Contract interpretation is a question of law” reviewed de novo.

Clarkson & Co. v. Cont’l Res., Inc., 2011 S.D. 72, ¶ 10, 806 N.W.2d 615, 618. “When

interpreting a contract, ‘this Court looks to the language that the parties used in

the contract to determine their intention.’” Id. ¶ 15, 806 N.W.2d at 619 (quoting

Pauley v. Simonson, 2006 S.D. 73, ¶ 8, 720 N.W.2d 665, 667-68). “When the words

of a contract are clear and explicit and lead to no absurd consequences, the search

for the parties’ common intent is at an end.” Nelson v. Schellpfeffer, 2003 S.D. 7, ¶

8, 656 N.W.2d 740, 743.

[¶21.]       The plain words of the contract unequivocally provide that if The

Dunbar was not built or the sculptures were not agreeably displayed elsewhere,

then Detmers would be entitled to the relief described in paragraph three.

“Elsewhere” must be understood in relation to the named place in the contract –

The Dunbar. Costner is correct that to accept Detmers argument would rewrite the

contract to include The Dunbar’s intended location as well as the resort itself. This

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#26104

we will not do. See Culhane v. W. Nat’l Mut. Ins. Co., 2005 S.D. 97, ¶ 27, 704

N.W.2d 287, 297 (“[W]e may neither rewrite the parties’ contract nor add to its

language . . . .”). As a matter of law, the court did not err in its conclusion that

Tatanka was elsewhere from The Dunbar. This conclusion is supported by giving

the terms in the parties’ contract their plain and ordinary meaning.

[¶22.]        Detmers also alleges that the court was clearly erroneous in finding

that Tatanka was intended to be separate and distinct from The Dunbar. She

points to newspaper articles and testimony in the record indicating that if The

Dunbar is built, Tatanka would be part of the resort property.

[¶23.]        The record and numerous exhibits support the circuit court’s finding

that Tatanka is separate from The Dunbar. Testimony reinforced that Tatanka was

constructed and managed as a separate legal entity from The Dunbar proposal. In

her response to Costner’s proposed findings of fact, Detmers concedes that Tatanka

is a stand-alone site. Detmers has not demonstrated that the court was clearly

erroneous or made an error of law in determining that Tatanka was separate from

The Dunbar.

                                    CONCLUSION

[¶24.]        The circuit court did not err or make any clearly erroneous factual

findings in determining that the sculptures are “agreeably displayed elsewhere,” in

the absence of a guarantee from Costner that The Dunbar would be built.

Furthermore, the circuit court did not err in concluding that Tatanka was

“elsewhere” under the language of the contract. We affirm.

[¶25.]        KONENKAMP, ZINTER, SEVERSON, and WILBUR, Justices, concur.

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