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City of Watertown v. Dakota, Minnesota & Eastern Railroad

Citations: 551 N.W.2d 571; 1996 SD 82; 1996 S.D. LEXIS 90; 1996 WL 366649Docket: Nos. 19421, 19447

Court: South Dakota Supreme Court; July 2, 1996; South Dakota; State Supreme Court

Narrative Opinion Summary

In this case, Steven T. Horning, P.C. appealed a circuit court decision regarding a declaratory judgment on a license agreement between the City of Watertown and the Chicago, Northwestern Transportation Co. (CNW), related to an easement for an underground oil pipeline. The agreement, part of a larger project involving Missouri Basin Municipal Power Agency, was executed and subsequently transferred to DME, excluding License 95804. After acquiring the relevant property, Horning sought to terminate the license, contending it was revocable at will. The trial court, however, determined that the license was unambiguous and revocable only under specific conditions, rejecting the need for parol evidence. Horning's appeal contested this interpretation, especially the court's reading of paragraphs outlining revocation rights. The appellate court conducted a de novo review, affirming the trial court's decision by enforcing the written terms and dismissing Horning's arguments. Additionally, the City raised an issue regarding the nonexistence of defaults, but this was not preserved for appeal. The final ruling confirmed the license's terms, limiting revocation to predefined conditions, thus upholding the City's position.

Legal Issues Addressed

Admissibility of Parol Evidence

Application: Parol evidence was deemed inadmissible as the license agreement was found to be integrated and unambiguous, with the parties’ intent clearly reflected in the document.

Reasoning: Regarding the admissibility of parol evidence, it is stated that such evidence is not permissible if the contract is integrated, unambiguous, and the parties’ intent is clear.

Interpretation of License Agreements

Application: The court found that the language of License 95804 was clear and unambiguous, enforcing the terms as written without necessitating parol evidence.

Reasoning: The court determined the language of License 95804 was clear and unambiguous, revocable only upon specified conditions, and concluded that considering parol evidence would yield the same result.

Preservation of Issues for Appeal

Application: The City failed to preserve the issue of nonexistence of defaults for appeal by not objecting or proposing alternative findings, as the trial court did not rule on this matter.

Reasoning: By failing to object or propose alternative findings, City did not preserve this issue for appeal, and the appellate court will not address matters not ruled upon by the trial court.

Revocation of Licenses

Application: The license was deemed revocable only under specific conditions such as discontinuation of use, unauthorized use, or violation of terms, rather than at the discretion of the licensor.

Reasoning: The specific terms of this contract indicate that CNW relinquished that right, restricting revocation to the aforementioned conditions.