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IN THE COURT OF APPEALS OF IOWA No. 9-390 / 08-1639 Filed July 2, 2009 TRI-COUNTY GRAIN CORPORATION, Plaintiff-Appellant/Cross-Appellee, vs. AMOS ZIMMERMAN d/b/a CANTRIL FEED & GRAIN, Defendant-Appellee/Cross-Appellant. ________________________________________________________________ Appeal from the Iowa District Court for Wapello County, Joel D. Yates, Judge.

Plaintiff appeals valuation date utilized to calculate grain-shortage damages and defendant cross-appeals for rent owed. REVERSED IN PART AND REMANDED. AFFIRMED IN PART

Sean P. Moore of Brown, Winick, Graves, Gross, Baskerville, & Schoenebaum, P.L.C., Des Moines, for appellant. Myron L. Gookin and Amy R. Miller of Foss, Kuiken, Gookin & Cochran, Fairfield, for appellee.

Considered by Mahan, P.J., and Eisenhauer and Mansfield, JJ.

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EISENHAUER, J. The Tri-County Grain Corporation appeals the valuation date of the grainshortage damages owed by Amos Zimmerman, the operator of Cantril Feed and Grain. Tri-County also appeals the statutory interest commencement date.

Zimmerman cross-appeals claiming the court erred in failing to find Tri-County owed him rent for grain storage. We affirm in part, but reverse and remand for correction of the statutory interest commencement date. I. Background Facts and Proceedings. Tri-County entered into a written lease for a grain warehouse facility owned by Zimmerman. In the summer of 2006, Zimmerman told Tri-County he would not renew the lease when it expired on September 1, 2006. Zimmerman stored both corn and soybeans for Tri-County in his warehouse. Under the terms of the lease, Zimmerman provided all the labor at the facility. Additionally,

Zimmerman was solely responsible for any grain shortages. If Tri-County sold any of its grain to Zimmerman, the lease provided Zimmerman would pay market price plus five cents per bushel. After the lease expired on September 1, 2006, the parties entered into an oral contract regarding Tri-County's remaining corn and soybeans. The parties agreed Zimmerman would purchase the corn and Tri-County would pay Zimmerman to transport the soybeans to ADM in Quincy, Illinois. Zimmerman needed corn for his nearby feed mill, but did not need soybeans. There was no discussion about Tri-County paying rent for storage and Zimmerman did not prepare invoices for rent. Tri-County did not pay rent after the lease expired.

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Zimmerman's purchase of Tri-County's corn was completed on December 29, 2006. Zimmerman did not deduct any rent/storage charges from his payment of $246,904.40 to Tri-County. On February 19, 2007, Zimmerman hauled the beans to ADM Quincy. Tri-County's agreement to pay Zimmerman for these hauling services was advantageous to Zimmerman because he bought supplies from ADM Quincy for his feed business. Therefore, he was not sending empty trucks to pick up his feed mill supplies. The parties stipulated a soybean shortage of 10,544.51 bushels occurred. Zimmerman does not dispute his responsibility for the shortage. The district court found "both parties knew of the soybean shortage sometime during September 2006," but the actual extent of the shortage (10,544.51 bushels) was not determined until February 19, 2007. In February 2007, Tri-County billed Zimmerman $76,444.11 for the soybean shortage. On July 17, 2007, Zimmerman, for the first time, claimed he was owed rent for storing Tri-County's corn and beans after September 1, 2006. Zimmerman's note to Tri-County stated: "If Tri-County Grain will charge

$76,444.11 for the beans I will charge them $76,444.11 for storage over that period of time that they left the beans and corn here without paying storage . . . ." The parties could not agree to a valuation for the soybean shortage and, on September 13, 2007, Tri-County filed suit. Tri-County claimed the soybeans should be valued at $7.23/bushel (approximately $76,000), the price on the February 19, 2007 delivery date. Zimmerman claimed the valuation should be $5.00/bushel (approximately $53,000), the price on the September 1, 2006 lease

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expiration date. Zimmerman also filed a counterclaim seeking an offset for rent for the two bins used by Tri-County for storage after the warehouse facility lease expired. At trial Zimmerman testified the rental offset should be $30,000. After a bench trial, the court determined the shortfall should be valued at a market price of five dollars per bushel. It awarded judgment in favor of TriCounty for $53,249.78 (five dollars market price plus five cents/bushel) with interest from August 26, 2008. The court denied Zimmerman's counterclaim for rent and ruled, "the court cannot conclude that a rental agreement . . . was part of the agreement reached by the parties." This appeal followed. II. Scope of Review. We review for correction of errors at law. Iowa R. App. P. 6.4. The district court's findings of fact have the effect of a special verdict and are binding on us if supported by substantial evidence. Van Oort Constr. Co. v. Nuckoll's Concrete Serv., Inc., 599 N.W.2d 684, 689 (Iowa 1999). "When a reasonable mind would accept the evidence as adequate to reach a conclusion, the evidence is substantial." Raper v. State, 688 N.W.2d 29, 36 (Iowa 2004). However, we are not bound by a district court's conclusions of law or application of legal conclusions. Id. "We view the evidence in a light most favorable to the trial court's judgment." Van Oort, 599 N.W.2d at 689. III. Soybean Shortfall Valuation. The parties agree the valuation for the soybean shortfall is governed by the measure of damages established in Iowa's Uniform Commercial Code: "[T]he measure of damages for nondelivery . . . by the seller is the difference

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between the market price at the time when the buyer learned of the breach and the contract price." Iowa Code

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