## Facts

- Jay V. Thomas owned ranch property in Williams County, North Dakota; Jerry J. Thomas and his wife, Laurie, lived on and worked the ranch during Jerry’s marriage.
- Jay died in 1995; his will granted Jerry certain land and a “first option” to buy other ranch assets and remaining rural surface real estate on specified terms.
- Jerry did not immediately exercise the purchase option and instead occupied additional ranch land as a tenant, paying one year’s rent in advance.
- The remaining ranch land was placed into the Jay V. Thomas Family Trust, with Carol Kay Moen and LaRae A. Thomas as co-trustees.
- The trustees offered Jerry a written seven-year lease; according to the trustees, Jerry declined a seven-year commitment and agreed to a year-to-year lease, again paying a year’s rent in advance.
- Jerry died during the lease year; after the term ended, Laurie sought to continue leasing, the trustees refused, and Laurie and the children remained in possession.
- The trustees sued to quiet title, obtain exclusive possession, and recover damages for post-term use and occupation.

## Issues

1. Whether the trial court improperly admitted trustees’ testimony recounting Jerry’s oral statements declining a seven-year lease and agreeing to a year-to-year lease as inadmissible hearsay.
2. Whether, if the tenancy was year-to-year, the trustees could terminate at the end of the lease year and obtain quiet title, exclusive possession, and damages for continued occupation.

## Decision

- The North Dakota Supreme Court affirmed the judgment after a bench trial.
- The court held the trial court did not err in admitting testimony about Jerry’s oral statements concerning the lease terms.
- The court held the finding of a year-to-year lease was supported by the record and not clearly erroneous.
- Because the lease was year-to-year and was not renewed, the trust was entitled to exclusive possession and damages for Laurie’s post-term use and occupation.

## Legal Principles

- In a bench trial, the trial court determines witness credibility; appellate review of factual findings is for clear error and does not reweigh evidence.
- Testimony describing a party’s oral statements may be admissible when used to establish the existence and terms of an agreement (including statements showing intent and assent), rather than as hearsay offered solely for their truth.
- A year-to-year tenancy may be terminated at the end of the yearly term upon proper termination, and continued possession after termination supports recovery for use and occupation.

## Conclusion

The court upheld a judgment quieting title and granting possession to the trust, concluding that testimony about Jerry’s oral отказ of a seven-year lease and acceptance of a year-to-year tenancy was properly admitted and supported the finding that the trustees could terminate the lease and recover damages for post-term occupancy.


Moen v. Thomas, 627 N.W.2d 146 (N.D. 2001)