IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF IOWA

CENTRAL DIVISION



LARRY JOHNSON and MARVIN JOHNSON,
Plaintiffs, No. C 96-3079-MWB
vs.

PRELIMINARY AND FINAL INSTRUCTIONS

TO THE JURY

LAND O' LAKES, INC.,
Defendant.

____________________

TABLE OF CONTENTS

PRELIMINARY INSTRUCTIONS

NO. 1 - PRELIMINARY INSTRUCTIONS

NO. 2 - GENERAL

NO. 3 - BURDEN OF PROOF

NO. 4 - ELEMENTS OF CLAIMS

NO. 5 - DUTY OF JURORS

NO. 6 - ORDER OF TRIAL

NO. 7 - DEFINITION OF EVIDENCE

NO. 8 - CREDIBILITY OF WITNESSES

NO. 9 - STIPULATED FACTS

NO. 10 - DEPOSITIONS

NO. 11 - INTERROGATORIES

NO. 12 - OBJECTIONS

NO. 13 - BENCH CONFERENCES

NO. 14 - NOTE-TAKING

NO. 15 - ADMONITION

FINAL INSTRUCTIONS

NO. 1 - INTRODUCTION

NO. 2 - IMPEACHMENT OF WITNESSES

NO. 3 - PLAINTIFFS' CLAIMS

NO. 4 - THE PLAINTIFFS' CLAIM OF BREACH OF CONTRACT

NO. 5 - DEFENDANT'S COUNTERCLAIMS

NO. 6 - COUNTERCLAIM 1:
BREACH OF CONTRACT

NO. 7 - COUNTERCLAIM 2:
EQUITABLE ESTOPPEL

NO. 8 - AFFIRMATIVE DEFENSE OF EQUITABLE ESTOPPEL

NO. 9 - COUNTERCLAIM 3:
UNJUST ENRICHMENT

NO. 10 - DAMAGES--IN GENERAL

NO. 11 - DAMAGES--SPECIFIC

NO. 12 - DELIBERATIONS

VERDICT FORM

___________________________________



PRELIMINARY INSTRUCTION NO. 1 - PRELIMINARY INSTRUCTIONS

Members of the jury, before the lawyers make their opening statements, I give you these preliminary instructions to help you better understand the trial and your role in it. Consider these instructions, together with any oral instructions given to you during the trial and the written final instructions given at the end of the trial, and apply them as a whole to the facts of the case. In considering these instructions, the order in which they are given is not important.



PRELIMINARY INSTRUCTION NO. 2 - GENERAL

The following brief summary of the case is not to be considered evidence or proof of any facts or events in the case. It simply informs you of the factual disputes between the parties.

This is a civil case brought by plaintiffs Larry Johnson and Marvin Johnson, two farmers from Rockwell, Iowa, against defendant Land O' Lakes, Inc., which owns a grain elevator in Rockwell, Iowa, called the Rockwell Ag Center. The case involves several so-called "Hedge-to-Arrive" grain contracts or "HTAs" the Johnsons entered into with Land O' Lakes. The Johnsons contend that Land O' Lakes breached the contracts. The Johnsons seek damages for their resulting injuries. Land O' Lakes disputes this claim.

Land O' Lakes has also brought its own claims, called "counterclaims," in this lawsuit. Land O' Lakes contends that the Johnsons breached the HTAs, and that the Johnsons have been unjustly enriched by their failure to deliver corn or soybeans on the HTAs. Land O' Lakes contends that the Johnsons are barred or "equitably estopped"from denying the enforceability of the contracts. Land O' Lakes seeks damages for its resulting injuries. The Johnsons dispute these counterclaims.

You will be asked to resolve these disputes between the parties.



PRELIMINARY INSTRUCTION NO. 3 - BURDEN OF PROOF

In these instructions, you are told that your verdict depends on whether you find certain facts have been proved. The Johnsons have the burden of proving their claims, while Land O' Lakes has the burden of proving its counterclaims. However, different claims and counterclaims in this lawsuit must be proved according to different burdens of proof.

Breach of contract and unjust enrichment must be proved by the "greater weight of the evidence." To prove something by the greater weight of the evidence is to prove that it is more likely true than not true. It is determined by considering all of the evidence and deciding which evidence is more believable. If, on any issue in the case, the evidence is equally balanced, you cannot find that issue has been proved.

Equitable estoppel, however, must be proved according to a higher standard. This claim must be proved by "clear, convincing, and satisfactory evidence." Evidence is clear, convincing, and satisfactory if there is no serious or substantial uncertainty about the conclusion to be drawn from it.

Neither the "greater weight" of the evidence nor "clear, convincing, and satisfactory evidence" is necessarily determined by the greater number of witnesses or exhibits a party has presented. The testimony of a single witness that produces in your mind a belief in the likelihood of truth is sufficient for proof of any fact and would justify a verdict in accordance with such testimony. This is so, even though a number of witnesses may have testified to the contrary, if after consideration of all of the evidence in the case, you hold a greater belief in the accuracy and reliability of that one witness.

You may have heard of the term "proof beyond a reasonable doubt." That is a stricter standard which applies in criminal cases. It does not apply in civil cases such as this. You should, therefore, put it out of your minds.



PRELIMINARY INSTRUCTION NO. 4 - ELEMENTS OF CLAIMS

To help you follow the evidence, here is a brief summary of the elements of the Johnsons' claim and Land O' Lakes' counterclaims. You must give separate consideration to the claim of each of the Johnsons against Land O' Lakes. Likewise, you must consider separately each of Land O' Lakes' counterclaims against each of the Johnsons.

The Johnsons' claim against Land O' Lakes

1. Breach of contract by Land O' Lakes

For Larry or Marvin Johnson to win his claim of breach of contract, he must prove the following five elements by the greater weight of the evidence:

One, the existence of a contract;

Two, the terms of the contract;

Three, the plaintiff has done what the contract requires or has been excused from doing what the contract requires;

Four, Land O' Lakes has breached the contract; and

Five, the amount of any damage Land O' Lakes caused by its breach of the contract.

If an individual plaintiff has failed to prove all of the above elements by the greater weight of the evidence, your verdict must be for Land O' Lakes on that plaintiff's claim of breach of contract.



Land O' Lakes' counterclaims against the Johnsons

Next, I will give you a brief summary of the elements of Land O' Lakes' counterclaims.



1. Equitable estoppel against the Johnsons

To win its claim of equitable estoppel against one of the Johnsons, Land O' Lakes must prove the following four essential elements by clear, convincing, and satisfactory evidence against him:

One, he made a false representation or concealment of material facts;

Two, Land O' Lakes lacked knowledge of the true facts;

Three, he intended that Land O' Lakes act on his representations; and

Four, Land O' Lakes relied upon the representations to its prejudice and injury.

If Land O' Lakes has failed to prove all of the above elements by clear, convincing, and satisfactory evidence as to either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' counterclaim of equitable estoppel.



2. Breach of contract

To win its claim of breach of contract against one of the Johnsons, Land O' Lakes must prove the following five elements by the greater weight of the evidence against him:

One, the existence of a contract;

Two, the terms of the contract;

Three, Land O' Lakes has done what the contract requires or has been excused from doing what the contract requires;

Four, he has breached his contract; and

Five, the amount of any damage he caused by his breach of the contract.

If Land O' Lakes has failed to prove all of the above elements by the greater weight of the evidence against either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' claim of breach of contract.



3. Unjust enrichment

You will consider this counterclaim only if you find that there was no express contract between the parties or you find that the contract is unenforceable. To win its claim of unjust enrichment against one of the Johnsons, Land O' Lakes must prove the following five elements by the greater weight of the evidence against him:

One, an enrichment to him;

Two, an impoverishment of Land O' Lakes;

Three, a connection between his enrichment and Land O' Lakes' impoverishment;

Four, absence of a justification for the enrichment and impoverishment; and

Five, the absence of a remedy provided by the law.

If Land O' Lakes has failed to prove all of the above elements by the greater weight of the evidence against either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' claim of unjust enrichment.

This is only a preliminary outline of the elements of parties' claims and counterclaims. At the end of the trial, I will give you final written instructions that explain these claims and counterclaims in greater detail. Because they are more detailed, those final instructions govern on the elements of parties' claims and counterclaims.



PRELIMINARY INSTRUCTION NO. 5 - DUTY OF JURORS

It will be your duty to decide from the evidence what the facts are. You, and you alone, are the judges of the facts. You will hear the evidence, decide what the facts are and then apply those facts to the law which I will give you in these preliminary instructions, any instructions given during the trial, and in the final instructions at the conclusion of the case. You will then deliberate and reach your verdict. You are the sole judges of the facts; but you must follow the law as stated in my instructions, whether you agree with it or not.

You have been chosen and sworn as jurors in this case to try the issues of fact presented by the parties. Do not allow sympathy or prejudice to influence you. The law demands of you a just verdict, unaffected by anything except the evidence, your common sense, and the law as I will give it to you.

This case should be considered and decided by you as an action between persons of equal standing in the community, of equal worth, and holding the same or similar stations in life. In this case, the defendant is a corporation. The mere fact that a party is a corporation does not mean that it is entitled to any greater or lesser consideration by you. All persons, including individuals and corporations, stand equal before the law, and are entitled to the same fair consideration by you.

When a corporation is involved, of course, it may act only through natural persons as its agents or employees; and, in general, any agent or employee of a corporation may bind the corporation by the acts and declarations made while acting within the scope of the authority delegated to the employee by the corporation, or within the scope of the employee's or agent's duties as an employee or agent of the corporation.

You should not take anything I may say or do during the trial as indicating what I think of the evidence or what I think your verdict should be.



PRELIMINARY INSTRUCTION NO. 6 - ORDER OF TRIAL

The trial will proceed in the following order:

After I conclude these preliminary instructions, the plaintiffs' lawyer may make an opening statement. Next, the defendant's lawyer may make an opening statement. An opening statement is not evidence, but is simply a summary of what the lawyers expect the evidence to be.

The plaintiffs will then present evidence and witnesses and the defendant may cross-examine. Following the plaintiffs' case, the defendant may present evidence and witnesses and the plaintiff may cross-examine. Following the defendant's case, the plaintiffs may take a further opportunity to present additional evidence.

After the evidence is concluded, I will give you the final instructions on the law that you are to apply in reaching your verdict. The lawyers will then make their closing arguments to summarize and interpret the evidence for you. As with opening statements, closing arguments are not evidence. I will then give you some final instructions on deliberations, and you will retire to deliberate on your verdict.



PRELIMINARY INSTRUCTION NO. 7 - DEFINITION OF EVIDENCE

You shall base your verdict only upon the evidence, these instructions, and other instructions that I may give you during the trial.

Evidence is:

1. Testimony in person or testimony previously given, which includes depositions or videotaped depositions.

2. Exhibits admitted into evidence by the court.

3. Stipulations, which are agreements between the parties.

4. Any other matter admitted into evidence.

Evidence may be direct or circumstantial. You should not be concerned with these terms since the law makes no distinction between the weight to be given to direct and circumstantial evidence. The weight to be given any evidence is for you to decide.

The following are not evidence:

1. Statements, arguments, questions, and comments by the lawyers.

2. Objections and rulings on objections.

3. Testimony I tell you to disregard.

4. Anything you saw or heard about this case outside the courtroom.

You should not take anything I may say or do during the trial as indicating what I think of the evidence.



PRELIMINARY INSTRUCTION NO. 8 - CREDIBILITY OF WITNESSES

In deciding what the facts are, you may have to decide what testimony you believe and what testimony you do not believe. You may believe all of what a witness says, or only part of it, or none of it.

In deciding what testimony to believe, consider the witnesses' intelligence, their opportunity to have seen or heard the things they testify about, their memories, the motives they may have for testifying a certain way, their manner while testifying, whether they said something different at an earlier time, the general reasonableness of their testimony, and the extent to which their testimony is consistent with other evidence that you believe.

In deciding whether or not to believe a witness, keep in mind that people sometimes hear or see things differently and sometimes forget things. You need to consider therefore whether a contradiction is an innocent misrecollection or lapse of memory or an intentional falsehood, and that may depend on whether it has to do with an important fact or only a small detail.

You may hear testimony from persons described as experts. Persons who have become experts in a field because of their education and experience may give their opinions on matters in that field and the reasons for their opinions. Consider expert testimony just like any other testimony. You may accept it or reject it. You may give it as much weight as you think it deserves, considering the witness's education and experience, the reasons given for the opinion, and all the other evidence in the case.

Also, an expert witness may be asked to assume certain facts are true and to give an opinion based on that assumption. This is called a hypothetical question. If any facts assumed in the question are not proved by the evidence, you should decide if that omission affects the value of the expert's opinion.



PRELIMINARY INSTRUCTION NO. 9 - STIPULATED FACTS

The plaintiffs and defendant have agreed or "stipulated" to certain facts and have reduced these facts to a written agreement or stipulation. Any counsel may, throughout the trial, read to you all or a portion of the stipulated facts. You should treat these stipulated facts as having been proved.



PRELIMINARY INSTRUCTION NO. 10 - DEPOSITIONS

Certain testimony from a deposition may be read into evidence. A deposition is testimony taken under oath before the trial and preserved in writing. Consider that testimony as if it had been given in court.



PRELIMINARY INSTRUCTION NO. 11 - INTERROGATORIES

During this trial, you may hear the word "interrogatory." An interrogatory is a written question asked by one party of another, who must answer it under oath in writing. Consider interrogatories and the answers to them as if the questions had been asked and answered here in court.



PRELIMINARY INSTRUCTION NO. 12 - OBJECTIONS

From time to time during the trial I may be called upon to make rulings of law on objections or motions made by the lawyers. It is the duty of the lawyer for each party to object when another party offers testimony or other evidence that the lawyer believes is not properly admissible. You should not show prejudice against a lawyer or the party the lawyer represents because the lawyer has made objections. You should not infer or conclude from any ruling or other comment I may make that I have any opinions on the merits of the case favoring one side or the other. Also, if I sustain an objection to a question that goes unanswered by the witness, you should not draw any inferences or conclusions from the question itself.



PRELIMINARY INSTRUCTION NO. 13 - BENCH CONFERENCES

During the trial it may be necessary for me to talk with the lawyers out of your hearing, either by having a bench conference here while you are present in the courtroom, or by calling a recess. Please understand that while you are waiting, we are working. The purpose of these conferences is to decide how certain evidence is to be treated under the rules of evidence, and to avoid confusion and error. We will, of course, do what we can to keep the number and length of these conferences to a minimum.



PRELIMINARY INSTRUCTION NO. 14 - NOTE-TAKING

If you want to take notes during the trial, you may. However, it is difficult to take detailed notes and pay attention to what the witnesses are saying. If you do take notes, be sure that your note-taking does not interfere with listening to and considering all of the evidence. Also, if you take notes, do not discuss them with anyone before you begin your deliberations. Do not take your notes with you at the end of the day. Be sure to leave them on your chair in the courtroom. The court attendant will safeguard the notes. No one will read them. The notes will remain confidential throughout the trial and will be destroyed at the conclusion of the trial.

If you choose not to take notes, remember it is your own individual responsibility to listen carefully to the evidence. You cannot give this responsibility to someone who is taking notes. We depend on the judgment of all members of the jury; you must all remember and consider the evidence in this case.

Whether or not you take notes, you should rely on your own memory regarding what was said. Your notes are not evidence. A juror's notes are not more reliable than the memory of another juror who chooses to consider the evidence carefully without taking notes. You should not be overly influenced by the notes.

You will notice that we do have an official court reporter making a record of the trial. However, we will not have typewritten transcripts of this record available for your use in reaching your verdict.



PRELIMINARY INSTRUCTION NO. 15 - ADMONITION

You will not be required to remain together while court is in recess. However, to ensure fairness, you, as jurors, must obey the following rules:

First, do not talk among yourselves about this case, or about anyone involved with it, until the end of the case when you go to the jury room to decide on your verdict.

Second, do not talk with anyone else about this case, or about anyone involved with it, until the trial has ended and you have been discharged as jurors.

Third, when you are outside the courtroom, do not let anyone tell you anything about the case, or about anyone involved with it until the trial has ended and your verdict has been accepted by me. If someone should try to talk to you about the case during the trial, please report it to me.

Fourth, during the trial you should not talk with or speak to any of the parties, lawyers or witnesses involved in this case--you should not even pass the time of day with any of them. It is important not only that you do justice in this case, but that you also give the appearance of doing justice. If a person from one side of the lawsuit sees you talking to a person from the other side--even if it is simply to pass the time of day--an unwarranted and unnecessary suspicion about your fairness might be aroused. If any lawyer, party, or witness does not speak to you when you pass in the hall, ride the elevator, or the like, remember it is because they are not supposed to talk or visit with you either.

Fifth, do not read any news stories or articles about the case, or about anyone involved with it, or listen to any radio or television reports about the case or about anyone involved with it.

Sixth, do not do any research or make any investigation about the case on your own.

Seventh, do not make up your mind during the trial about what the verdict should be. Keep an open mind until after you have gone to the jury room to decide the case and you and your fellow jurors have discussed the evidence.

DATED this 1st day of September, 1998.



_____________________________

MARK W. BENNETT

U. S. DISTRICT COURT JUDGE





FINAL INSTRUCTION NO. 1 - INTRODUCTION

Members of the jury, the instructions I gave you at the beginning of the trial and any oral or written instructions I gave you during the trial remain in effect. I now give you some additional instructions.

You must, of course, continue to follow the instructions I gave you earlier, as well as those I give you now. You must not single out some instructions and ignore others, because all are important. The instructions I am about to give you now, as well as the preliminary instructions given to you at the beginning of the trial, are in writing and will be available to you in the jury room. I emphasize, however, that the final instructions are not more important than the preliminary instructions, nor are written instructions more important than oral ones. Again, all instructions, whenever given and whether in writing or not, must be followed. This is true even though some of the instructions I gave you at the beginning of the trial are not repeated here.

In considering these instructions, the order in which they are given is not important.

Neither in these instructions nor in any ruling, action, or remark that I have made during the course of this trial have I intended to give any opinion or suggestion as to what your verdict should be.



FINAL INSTRUCTION NO. 2 - IMPEACHMENT OF WITNESSES

In Preliminary Instruction No. 8, I instructed you on the credibility of witnesses. I now give you this further instruction on how the credibility of a witness can be "impeached."

A witness may be discredited or "impeached" by contradictory evidence, or by evidence that at some time the witness has said or done something, or has failed to say or do something, that is inconsistent with the witness's present testimony. If you believe any witness has been impeached and thus discredited, it is your exclusive province to give the testimony of that witness such credibility, if any, as you may think it deserves.



FINAL INSTRUCTION NO. 3 - PLAINTIFFS' CLAIMS

The Johnsons contend that Land O' Lakes breached the contracts. The Johnsons seek damages for their resulting injuries. Land O' Lakes disputes the Johnsons' claims of breach of contract.

Remember that you must give separate consideration to the claim of each of the Johnsons against Land O' Lakes and you must give separate consideration to Land O' Lakes' defenses to the claims of each of the Johnsons. Also remember that, when a corporation is involved, as is the case here, it may act only through natural persons as its agents or employees; and, in general, any agent or employee of a corporation may bind the corporation by the acts and declarations made while acting within the scope of the authority delegated to the employee by the corporation, or within the scope of the employee's or agent's duties as an employee or agent of the corporation.



FINAL INSTRUCTION NO. 4 - THE PLAINTIFFS' CLAIM OF

BREACH OF CONTRACT

The Johnsons allege breach of contract by Land O' Lakes. For Larry or Marvin Johnson to win his claim of breach of contract, he must prove the following five elements by the greater weight of the evidence:

One, the existence of a contract.

"Contract" means the total legal obligation that results from the parties' agreement. "Agreement" means the bargain of the parties in fact as found in their language or by implication from other circumstances, including course of dealing or course of performance, as defined below. The existence of a contract requires a meeting of the minds on the material terms. This means the parties must agree upon the same things in the same sense. You are to determine if a contract existed from the words and acts of the parties, together with all reasonable inferences you may draw from the surrounding circumstances.



Two, the terms of the contract.

The written terms of the HTA contracts between Land O' Lakes and the Johnsons (1) include a term requiring actual physical delivery of grain under the contracts, and (2) do not, as written, provide Larry or Marvin Johnson with a right to roll the contracts to a new futures option month.

However, a writing signed by the parties need not contain all the material terms of the contract and such material terms as are stated need not be precisely stated. All that is required is that the writing afford a basis for believing that oral evidence of an agreement rests on a real transaction. The only terms that must appear in the writing is the quantity of goods involved in the agreement. Terms in a writing that is intended by the parties as a final expression of their agreement with respect to such terms as are included in it may not be contradicted by evidence of any prior agreement or of a contemporaneous oral agreement, but may be explained or supplemented. "Supplement" means "to add to."

Terms of the writing may be supplemented by a course of dealing. A "course of dealing" is a sequence of previous conduct between the parties to a particular transaction that is fairly to be regarded as establishing a common basis of understanding for interpreting their expressions and other conduct. A course of dealing can give particular meaning to and can supplement or qualify terms of an agreement.

Terms of the writing may also be supplemented by a course of performance. A "course of performance" can exist where a contract involves repeated occasions for performance by either party with knowledge of the nature of the performance and an opportunity for objection to it by the other. A course of performance accepted or acquiesced in without objection can be used to determine the meaning of the agreement.

Whenever it is reasonable to do so, the written terms of the agreement and any course of performance or course of dealing must be construed as consistent with each other. However, when it is unreasonable to do so, the written terms shall control over course of performance or course of dealing.

Terms of the writing may also be supplemented by evidence of consistent additional terms.

The Johnsons contend that the material terms of their HTA contracts with Land O' Lakes included a term that Land O' Lakes would be responsible for commission and margin requirements of the transactions set forth in the contract. The Johnsons contend that the material terms of their HTA contracts with Land O' Lakes also included a term that allowed the plaintiffs, at their discretion, if dissatisfied with the price they were to receive under their contracts, to "roll" the contracts into a deferred month and to sell the grain for cash. In determining whether these terms were part of the contract, you may consider the following:

a. the intent of the parties along with a reasonable application of the surrounding circumstances.

b. the intent expressed in the language used prevails over any secret intention of either party.

c. the intent may be shown by the practical interpretation of a contract by the parties and by the surrounding circumstances.

d. you must attempt to give meaning to all language of a contract. Because an agreement is to be interpreted as a whole, assume that all of the language is necessary. An interpretation that gives a reasonable, effective meaning to all terms is preferred to an interpretation that leaves a part of the contract unreasonable or meaningless.

e. the meaning of a contract is the interpretation a reasonable person would give it if he or she were acquainted with the circumstances both before and at the time the contract was made.

f. ambiguous language in a written contract is interpreted against the party who selected it.

g. where general and specific terms in the contract refer to the same subject, the specific terms control.

Every contract imposes on the parties to it an obligation of good faith in its performance. In the case of a merchant, the obligation of good faith requires both honesty in fact and the observance of reasonable commercial standards of fair dealing in the trade. In the case of non-merchants, the obligation of good faith requires honesty in fact. "Merchant" means a person who deals in goods of the kind or otherwise by the person's occupation holds that person out as having knowledge or skill peculiar to the practices or goods involved in the transaction or to whom such knowledge or skill may be attributed by the person's employment of an agent or broker or other intermediary who by the intermediary's occupation holds the intermediary out as having such knowledge or skill.



Three, the plaintiff has done what the contract requires or has been excused from doing what the contract requires.

When a person agrees to do something for a specified consideration to be received after full performance, that person is not entitled to any part of the consideration until he or she has performed as agreed, unless full performance has been excused by the act of the other party. However, a plaintiff who has not fully performed under the terms of the contract may still recover some amount if the failure to render performance due at an earlier time was not material. In determining whether a failure to render or to offer performance is material, the following circumstances are significant: (1) the extent to which the defendant will be deprived of the benefit the defendant reasonably expected; (2) the extent to which the defendant can be adequately compensated for the part of that benefit of which the defendant will be deprived; (3) the extent to which the plaintiff will suffer forfeiture; (4) the likelihood that the plaintiff will cure the failure, taking account of all the circumstances including any reasonable assurances; and (5) the extent to which the behavior of the plaintiff is in line with standards of good faith and fair dealing.

The plaintiff's performance is excused where the defendant clearly rejects the contract by giving notice to the plaintiff that the defendant will not perform. This is called "renunciation." The plaintiff's performance is also excused when the defendant makes a statement that, fairly read, amounts to a statement of intention not to perform the contract except on conditions that go beyond those provided in the contract. This is called "repudiation." Mere demand for performance under the contract is not repudiation.



Four, Land O' Lakes has breached the contract.

A breach of the contract occurs when the defendant fails to perform a term of the contract. A breach of contract also occurs when the defendant breaches the covenant of good faith imposed on the parties to every contract. A breach also occurs when the defendant "renounces" or "repudiates" a contract, as those terms were defined in the explanation to element three above.

A breach of contract also occurs when the defendant unreasonably demands adequate assurances of performance when not insecure or demands assurances that are unreasonable, and refuses to perform without such assurances. A demand for adequate assurances must be in writing. Between merchants, the reasonableness of grounds for insecurity and the adequacy or reasonableness of demands for or offers of assurances must be determined according to commercial standards. "Between merchants" means any transaction with respect to which both parties are chargeable with the knowledge or skill of merchants. "Merchant" was defined for you in the explanation of element two.

"Termination" of a contract occurs when either party puts an end to the contract otherwise than for its breach. On "termination" all obligations that are still executory on both sides are discharged, but any right based on prior breach or performance survives.

"Cancellation" occurs when either party puts an end to the contract for breach by the other and its effect is the same as that of "termination," except that the canceling party also retains any remedy for breach of the whole contract or any unperformed balance.



Five, the amount of any damage Land O' Lakes caused by its breach of the contract.

If an individual plaintiff has failed to prove all of the above elements by the greater weight of the evidence, your verdict must be for Land O' Lakes on that plaintiff's claim of breach of contract. However, if a plaintiff has proved all of these elements by the greater weight of the evidence, that plaintiff is entitled to damages for breach of contract in some amount, unless you find that the plaintiff is barred or "equitably estopped" by his representations from denying the enforceability of the contracts, as the affirmative defense of "equitable estoppel" is explained to you in Final Instruction No. 8. Remember that "greater weight of the evidence" was explained to you in Preliminary Instruction No. 3 on the burdens of proof.



FINAL INSTRUCTION NO. 5 - DEFENDANT'S COUNTERCLAIMS

Land O' Lakes has also brought its own claims, called "counterclaims," in this lawsuit. Land O' Lakes contends that the Johnsons breached the HTAs; that the Johnsons are barred or "equitably estopped" by their representations from denying the enforceability of the contracts; and that the Johnsons have been unjustly enriched by their failure to deliver corn or soybeans on the HTAs. Land O' Lakes seeks damages for its resulting injuries. The Johnsons dispute these counterclaims.



FINAL INSTRUCTION NO. 6 - COUNTERCLAIM 1:

BREACH OF CONTRACT

Land O' Lakes' first counterclaim against each of the Johnsons is a claim for breach of contract. To win its claim of breach of contract against one of the Johnsons, Land O' Lakes must prove the following five elements by the greater weight of the evidence against him:

One, the existence of a contract.

The existence of a contract requires a meeting of the minds on the material terms. This means the parties must agree upon the same things in the same sense. You are to determine if a contract existed from the words and acts of the parties, together with all reasonable inferences you may draw from the surrounding circumstances.



Two, the terms of the contract.

The written terms of the HTA contracts between Land O' Lakes and the Johnsons (1) include a term requiring actual physical delivery of grain under the contracts, and (2) do not, as written, provide Larry or Marvin Johnson with a right to roll the contracts to a new futures option month.



Three, Land O' Lakes has done what the contract requires or has been excused from doing what the contract requires.

Four, one of the Johnsons has breached his contract.

A breach of the contract occurs when the defendant fails to perform a term of the contract. A breach of contract also occurs when one party to a contract fails to provide the other party with adequate assurances of performance after a justified demand for such assurances has been made in writing. To prove a failure to give adequate assurances, Land O' Lakes must prove the following: (1) reasonable grounds for insecurity arose with respect to one of the Johnsons' performance under his HTA contracts; (2) Land O' Lakes demanded from that counterclaim defendant, in writing, reasonable assurances of due performance of his HTA contracts; and (3) that counterclaim defendant failed to provide Land O' Lakes with adequate assurances of due performance of the HTA contracts within a reasonable time after Land O' Lakes' demand.



Five, the amount of any damage he caused by his breach of the contract.

If Land O' Lakes has failed to prove all of the above elements by the greater weight of the evidence against either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' claim of breach of contract. However, if Land O' Lakes has proved all of the above elements by the greater weight of the evidence as to one or both of the Johnsons, then Land O' Lakes is entitled to damages in some amount against him or them on its claim of breach of contract. Remember that "greater weight of the evidence" was explained to you in Preliminary Instruction No. 3 on the burdens of proof.



FINAL INSTRUCTION NO. 7 - COUNTERCLAIM 2:

EQUITABLE ESTOPPEL

Land O' Lakes' second counterclaim against each of the Johnsons is a claim of equitable estoppel. To win its counterclaim of equitable estoppel against one of the Johnsons, Land O' Lakes must prove the following four essential elements by clear, convincing, and satisfactory evidence against him:

One, he made a false representation or concealment of material facts.

A "representation" is any word or conduct asserting the existence of a fact. A representation of fact includes an opinion expressed for the deliberate purpose of deceiving another. A representation of fact includes a promise to perform a future act. A representation also includes an opinion. An opinion is a statement of a person's belief that a fact exists or that person's judgment as to quality, value, authenticity, or a similar matter.

A representation of fact implies that the maker has definite knowledge or information supporting his or her statement; a representation of opinion does not. You must consider all of the surrounding circumstances, including the exact words used, in deciding whether a representation is one of fact or opinion.

A fact is "material" if: (1) a reasonable person would consider it as important in making a decision; (2) the defendant knows or has reason to know that the plaintiff considers, or is likely to consider, the fact as important in making a decision; or (3) the fact influences a person to enter into a transaction that would not have occurred otherwise.

"Concealment" may be shown by actions to prevent another from learning about material information, or it may be shown by silence or inaction in response to a request for the material information.

Land O' Lakes alleges that the Johnsons made the following representations or concealments:

a. Larry Johnson represented to Land O' Lakes that he intended to perform his obligations under HTA contracts 904, 927, and 1004 through 1008 and concealed an intent not to perform those obligations.

b. Marvin Johnson represented to Land O' Lakes that he intended to perform his obligations under HTA contracts 834 through 836, 851, 857, 860, 900, 926, and 933 through 936 and concealed an intent not to perform those obligations.



Two, Land O' Lakes lacked knowledge of the true facts.

Three, he intended that Land O' Lakes act on his representations.

The necessary intention can be inferred from actions that show one of the Johnsons wanted to deceive Land O' Lakes as to representations or concealments or believed that in all likelihood Land O' Lakes would be deceived; the concealment or promise would deceive a person as to his intention to perform obligations under the HTAs; or one of the Johnsons concealed or made unfulfilled promises as to his intention to perform his obligations under the HTAs without regard for their importance to Land O' Lakes.



Four, Land O' Lakes relied upon the representations to its prejudice and injury.

Land O' Lakes must rely on the representation and the reliance must be justified. It is not necessary that the representation be the only reason for Land O' Lakes' action. It is enough if the representation was a substantial factor in bringing about the action. Whether reliance is justified depends on what Land O' Lakes can reasonably be expected to do in light of its own information and intelligence. Reliance is not justified if the representation is of an unimportant fact or is obviously false.

Land O' Lakes is justified in relying on one of the Johnsons' representations of opinion only if one or more of the following situations exist: (1) he has or claims to have special knowledge of the matter that Land O' Lakes does not have; (2) he has a fiduciary or other similar relation of trust and confidence with Land O' Lakes; (3) he has successfully tried to gain Land O' Lakes' confidence; (4) he knows of some special reason to expect that Land O' Lakes will rely on the opinion.

A person is presumed to be able to form his or her own opinion about the wisdom of entering into a routine transaction. A person entering into an ordinary transaction is not justified in relying upon the other party's "puffing," "sales talk," or other general opinion of the value of the transaction. However, a person may be justified in relying upon a statement that the transaction is satisfactory for the person's announced purpose.



If Land O' Lakes has failed to prove all of the above elements by clear, convincing, and satisfactory evidence as to either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' counterclaim of equitable estoppel. However, if Land O' Lakes has proved all of the above elements by clear, convincing, and satisfactory evidence as to either or both of the Johnsons, you must award damages to Land O' Lakes to the extent it was injured by its reliance on his or their representations or concealments. Remember that "clear, convincing, and satisfactory evidence" was explained to you in Preliminary Instruction No. 3 on the burdens of proof.



FINAL INSTRUCTION NO. 8 - AFFIRMATIVE DEFENSE OF

EQUITABLE ESTOPPEL

Land O' Lakes also asserts equitable estoppel as an affirmative defense to the Johnsons' claim of breach of contract by Land O' Lakes. If you find that Land O' Lakes has proved all of the elements of equitable estoppel, as explained in Final Instruction No. 7, by clear, convincing, and satisfactory evidence, against one or both of the Johnsons, then you must further find that he or they are barred from asserting that the HTA contracts are unenforceable on his or their claim of breach of contract in Final Instruction No. 4, and that he or they are barred from denying his or their obligations under the HTA contracts as a defense to Land O' Lakes' claim of breach of contract in Final Instruction No. 6. Remember that "clear, convincing, and satisfactory evidence" was explained to you in Preliminary Instruction No. 3 on the burdens of proof.



FINAL INSTRUCTION NO. 9 - COUNTERCLAIM 3:

UNJUST ENRICHMENT

Land O' Lakes' third counterclaim against each of the Johnsons is for unjust enrichment. You will consider this counterclaim only if you find that there was no express contract between the parties or you find that the contract is unenforceable. To win its claim of unjust enrichment against one of the Johnsons, Land O' Lakes must prove the following five elements by the greater weight of the evidence against him:

One, an enrichment of one of the Johnsons.

You may find that one of the Johnsons was enriched if you find that he profited by delivering grain on the cash market.



Two, an impoverishment of Land O' Lakes.

You may find that Land O' Lakes was impoverished if you find that it paid commissions, margin calls, or other expenses in anticipation of the Johnsons delivering grain on their HTA contracts.



Three, a connection between his enrichment and Land O' Lakes' impoverishment.

There is a connection between one person's enrichment and another person's impoverishment when the enrichment of one is a substantial factor in producing the impoverishment of the other and when the impoverishment would not have happened except for the enrichment. "Substantial factor" means that the enrichment of one person has such an effect in producing the impoverishment of the other as to lead a reasonable person to regard it as a cause.



Four, absence of a justification for the enrichment and impoverishment.

An unjust enrichment of a person occurs when he retains money or benefits that in justice and equity belong to another. Therefore, the law will order the person benefitted to pay just value to prevent unjust enrichment.



Five, the absence of a remedy provided by the law.

Remedies at law include damages for breach of contract. Therefore, you may find this element is proved only if you find that there is no enforceable contract upon which Land O' Lakes could obtain damages for the contract's breach.



If Land O' Lakes has failed to prove all of the above elements by the greater weight of the evidence against either Larry or Marvin Johnson, or both, your verdict must be for him or them on Land O' Lakes' claim of unjust enrichment. However, if Land O' Lakes has proved all of the above elements by the greater weight of the evidence against one or both of the Johnsons, then Land O' Lakes is entitled to damages in some amount against one or both of them on its counterclaim of unjust enrichment. Remember that "greater weight of the evidence" was explained to you in Preliminary Instruction No. 3 on the burdens of proof.



FINAL INSTRUCTION NO. 10 - DAMAGES--IN GENERAL

If you find in favor of one of the parties on one of his or its claims or counterclaims, you must award that party such sum as you find will fairly and justly compensate that party for any damages you find that party sustained as a direct result of the other party's wrongful conduct. However, I must explain to you now some matters applicable to all of your determinations of damages.

Because each of the parties has asserted several claims or counterclaims, you must award full damages for each claim or counterclaim on which you find that party has prevailed. Do not be concerned with any overlap of damages.

In arriving at the amount of damages on a claim or counterclaim, you cannot establish a figure by taking down the estimate of each juror as to damages and agreeing in advance that the average of those estimates shall be your award of damages for that claim or counterclaim.

Remember, throughout your deliberations, you must not engage in any speculation, guess, or conjecture. Although the precise amount of a party's damages may be difficult to determine, that should not affect the party's recovery. On the other hand, a party is not to be awarded purely speculative damages. Damages may be awarded only when there is some reasonable basis in the evidence in the case for determining that the party has in fact suffered a loss, even though the amount of such loss is difficult to determine.

You must not award damages under any of these Instructions by way of punishment or through sympathy. Your judgment must not be exercised arbitrarily, or out of sympathy or prejudice, for or against any of the parties. The amount you assess for any item of damage must not exceed the amount caused by the wrongful conduct of a party as proved by the evidence.

The fact that I am instructing you on the proper measure of damages should not be considered as an indication that I have any view as to which party is entitled to your verdict in this case. Instructions as to the measure of damages are given only for your guidance, in the event that you should find that a party is entitled to damages in accord with the other instructions.



FINAL INSTRUCTION NO. 11 - DAMAGES--SPECIFIC

The parties seek damages for three different kinds of claims: breach-of-contract claims, an equitable estoppel claim, and an unjust enrichment claim. I will now explain the measure of damages for each of these kinds of claims.

Breach of contract. This measure of damages applies to the Johnsons' claim of breach of contract, as explained in Final Instruction No. 4, and to Land O' Lakes' counterclaim of breach of contract, as explained in Final Instruction No. 6. The measure of damages for breach of contract is an amount that will reimburse the party making the claim or counterclaim for the loss caused by his or its reliance on the contract and that will place him or it in as good a position as if the other party had not breached the contract. The damages you award for breach of contract must be foreseeable or have been reasonably foreseen at the time the parties entered into the contract.

If you find that Land O' Lakes breached its contract with Larry or Marvin Johnson or both of them in accordance with the five elements set forth in Final Instruction No. 4, the specific measure of damages is the profit which Larry or Marvin Johnson would have made from full performance of the contract by Land O' Lakes. If you do not find that Land O' Lakes breached its contract with Larry or Marvin Johnson or both of them in accordance with the five elements set forth in Final Instruction No. 4, then you must not use this specific measure of damages for Larry or Marvin Johnson's claim of breach of contract against Land O' Lakes.

If you find that Larry or Marvin Johnson or both of them breached his or their contracts to deliver grain to Land O' Lakes in accordance with the five elements set forth in Final Instruction No. 6, the specific measure of Land O' Lakes' damages is the difference between the market price of the grain at the time Land O' Lakes learned of the breach and the contract price of the grain. Market price is determined at the place where the grain was to be delivered. If you do not find that Larry or Marvin Johnson breached his or their contracts to deliver grain to Land O' Lakes in accordance with the five elements set forth in Final Instruction No. 6, then you must not use this specific measure of damages for Land O' Lakes' claim of breach of contract against Larry or Marvin Johnson.

Remember that damages for breach of contract, like other elements of that claim or counterclaim, must be proved by the greater weight of the evidence.

Equitable estoppel. This measure of damages applies to Land O' Lakes' counterclaim of equitable estoppel, as explained in Final Instruction No. 7. The measure of damages for equitable estoppel is the extent to which Land O' Lakes was injured by its reliance on the representations or concealments.

Remember that damages for equitable estoppel, like other elements of that counterclaim, must be proved by clear, convincing, and satisfactory evidence.

Unjust enrichment. This measure of damages applies to Land O' Lakes' counterclaim of unjust enrichment, as explained in Final Instruction No. 9. The party that has been unjustly enriched must "compensate" or pay "just value" to the impoverished party. Therefore, the damages you award for unjust enrichment are the amount of Land O' Lakes' impoverishment caused by the unjust enrichment of Larry or Marvin Johnson or both of them.

Remember that damages for unjust enrichment, like other elements of that counterclaim, must be proved by the greater weight of the evidence.



FINAL INSTRUCTION NO. 12 - DELIBERATIONS

In conducting your deliberations and returning your verdict, there are certain rules you must follow.

First, when you go to the jury room, you must select one of your members as your foreperson. That person will preside over your discussions and speak for you here in court.

Second, it is your duty, as jurors, to discuss this case with one another in the jury room. You should try to reach agreement if you can do so without violence to individual judgment, because a verdict must be unanimous. Each of you must make your own conscientious decision, but only after you have considered all the evidence, discussed it fully with your fellow jurors, and listened to the views of your fellow jurors. Do not be afraid to change your opinions if the discussion persuades you that you should, but do not come to a decision simply because other jurors think it is right, or simply to reach a verdict. Remember at all times that you are not partisans. You are judges--judges of the facts. Your sole interest is to seek the truth from the evidence in the case.

Third, if you need to communicate with me during your deliberations, you may send a note to me through the Court Security Officer, signed by one or more jurors. I will respond as soon as possible either in writing or orally in open court. Remember that you should not tell anyone--including me--how your votes stand numerically.

Fourth, your verdict must be based solely on the evidence and on the law which I have given to you in my instructions. The verdict must be unanimous. Nothing I have said or done is intended to suggest what your verdict should be--that is entirely for you to decide.

Finally, I am giving you the verdict forms. A verdict form is simply the written notice of the decision that you reach in this case. You will take this form to the jury room, and when each of you has agreed on the verdicts, your foreperson will fill in the form and date it, all jurors will sign it, and the foreperson will advise the Court Security Officer that you are ready to return to the courtroom.

DATED this ____ day of September, 1998.





_____________________________

MARK W. BENNETT

U. S. DISTRICT COURT JUDGE





IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF IOWA

CENTRAL DIVISION

LARRY JOHNSON and MARVIN JOHNSON,
Plaintiffs, No. C 96-3079-MWB
vs.

VERDICT FORM

LAND O' LAKES, INC.,
Defendant.

____________________



On the claims and counterclaims presented, we, the Jury, find as follows:

PLAINTIFFS' CLAIMS

CLAIMS PREVAILING PARTY

(Mark only one for each claim)

DAMAGES, IF ANY

(Complete only if party making the claim prevails)

Larry Johnson's claim of breach of contract ____ Larry Johnson

____ Land O' Lakes



$
Marvin Johnson's claim of breach of contract ____ Marvin Johnson

____ Land O' Lakes



$


DEFENDANT'S COUNTERCLAIMS
COUNTERCLAIMS PREVAILING PARTY

(Mark only one for each counterclaim)

DAMAGES, IF ANY

(Complete only if party making the counterclaim prevails)

Land O' Lakes' counterclaim of breach of contract against Larry Johnson ____ Land O' Lakes

____ Larry Johnson



$
Land O' Lakes' counterclaim of breach of contract against Marvin Johnson ____ Land O' Lakes

____ Marvin Johnson



$
Land O' Lakes' counterclaim of equitable estoppel against Larry Johnson ____ Land O' Lakes

____ Larry Johnson



$
Land O' Lakes' counterclaim of equitable estoppel against Marvin Johnson ____ Land O' Lakes

____ Marvin Johnson



$
Land O' Lakes' counterclaim of unjust enrichment against Larry Johnson ____ Land O' Lakes

____ Larry Johnson



$
Land O' Lakes' counterclaim of unjust enrichment against Marvin Johnson ____ Land O' Lakes

____ Marvin Johnson



$




Date: ________________



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FOREPERSON



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JUROR JUROR



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JUROR JUROR



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JUROR JUROR



____________________________

JUROR