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Deppe v. Deppe

Court of Appeals of Iowa

July 6, 2017

JOHN DEPPE and DEPPE JJ, LLC f/k/a DOERSCHER-DEPPE, LLC, Plaintiffs-Appellants,
v.
DOUGLAS H. DEPPE and KIM DOERSCHER-DEPPE, Defendants-Appellees.

         Appeal from the Iowa District Court for Clinton County, Mark D. Cleve, Judge.

         John Deppe and his business, Deppe JJ, LLC, appeal following jury verdicts in favor of defendants Doug Deppe and Kim Doerscher-Deppe. AFFIRMED.

          Kevin J. Visser and Abbe M. Stensland of Simmons Perrine Moyer Bergman PLC, Cedar Rapids, for appellants.

          James D. Bruhn, PLC of Farwell & Bruhn, Clinton, for appellees.

          Considered by Potterfield, P.J., and Doyle and Tabor, JJ.

          DOYLE, Judge.

         John Deppe and his business, Deppe JJ, LLC, formerly known as Doerscher-Deppe, LLC, appeal following jury verdicts in favor of defendants Doug Deppe and Kim Doerscher-Deppe finding, among other things, that there was no breach of the parties' settlement agreement by the defendants. Plaintiffs assert the district court erred in not giving their proposed jury instruction defining the term "crop year" as used in the settlement agreement, arguing the term is defined by statute, regulation, by the court, by industry usage, and by the parties. Plaintiffs argue the district court compounded the error by instructing the jury that "There is no established legal definition of 'crop year' in this case." Upon our review, we conclude, based upon the language of the parties' settlement agreement along with the extrinsic evidence presented, there was no reversible instructional error. Further, we conclude that, even if there was instructional error, it did not result in prejudice because of Plaintiffs' failure to materially comply with the terms of the settlement agreement. Accordingly, we affirm the jury's verdicts.

         I. Background Facts and Proceedings.

         This appeal concerns the settlement agreement entered into by the former members of Doerscher-Deppe, LLC ("LLC")-John Deppe, his cousin Doug Deppe, and Doug's wife Kim Doerscher-Deppe. Doug, Kim, John, and John's wife, Joelle, have engaged in farming most of their lives. John, Doug, and Kim each have experience leasing farm land; Doug and Kim leased their own land to John, who owned his own equipment, to farm their land.

         Kim's father, owner and operator of Doerscher Ag, Ltd., passed away in 2006. His business owned land that was leased, but, by way of a trust in favor of Kim's mother, the trust was the lessor of some of that land and the rents collected were assigned to Kim's mother. Additionally, Kim's father, through his business and also individually, continually leased and farmed other farms. Upon his death, Kim and her two siblings each inherited a third of their father's company's shares.

         To maintain and farm the leases held by Kim's father's company, which still had time remaining upon them, John, Doug, and Kim formed LLC in 2007. John owned fifty percent, and Doug and Kim each owned twenty-five percent. LLC borrowed money for initial expenses, including paying rent due on the farmland leased and financing the crops. John custom farmed the land leased by LLC with his own equipment, and Kim sold the crops. The LLC would then pay John for his custom farming out of the proceeds of the sales. The money left in LLC after the expenses were paid was used to pay down the loan and to finance LLC's operations for the next year. Kim and Doug took care of LLC's books, including writing the checks to pay their landlords, and they maintained the relationships with their landlords, essentially acting as the face of LLC.

         By 2012, John, Doug, and Kim had disagreements concerning LLC's operation. Kim's mother terminated her trust's lease with LLC, as did Kim's brother, on behalf of Doerscher Ag, Ltd. John eventually filed suit against Doug and Kim.

         Ultimately, LLC's members entered into a settlement agreement in January 2013, setting forth numerous terms to which the parties assented. Among many things, the agreement provided that Kim and Doug would transfer their membership interest in LLC to John in exchange for a cash settlement. Additionally, the parties agreed to the following paragraphs at issue here:

3. [LLC] will be entitled to farm [several farms that LLC had leased, including the Wegener farm, the Curtis farm, the Merle Doerscher farm, the Kelly farm, and the Carter/Conklin farm]. . . .
4. Kim and Doug will be entitled to farm the [farmland leased by Doerscher Ag, Ltd. and the trust]. . . .
5. At the end of the 2013 crop year, all leases are open for ...

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