A Minnesota company sued for breach of contract can ask the court to dismiss the claim before filing an answer, under Rule 12.02 of the Minnesota Rules of Civil Procedure. In Minnesota state court the bar is low for the plaintiff: the complaint survives if relief is possible on any evidence consistent with the plaintiff’s theory. The motions that succeed are narrow ones, built on a defect the plaintiff cannot plead around.

Minnesota’s rules here come mostly from the court rules and the Minnesota Supreme Court’s reading of them, especially Walsh v. U.S. Bank, N.A., 851 N.W.2d 598 (Minn. 2014). A few statutes supply the defenses, such as the statute of frauds, the limitations periods, and the arbitration act. This page is part of my material on Minnesota contract law, written for a company that has been served with a contract lawsuit.

How does a motion to dismiss work in a Minnesota contract case?

A motion to dismiss asks the judge to end some or all of the case based on the complaint alone, before your company answers it. Minnesota’s rule lists six defenses that can be raised this way, and the motion must come before the answer, which has its own deadline.

Under Minn. R. Civ. P. 12.02, “the following defenses may at the option of the pleader be made by motion: (a) lack of jurisdiction over the subject matter; (b) lack of jurisdiction over the person; (c) insufficiency of process; (d) insufficiency of service of process; (e) failure to state a claim upon which relief can be granted; and (f) failure to join a party pursuant to Rule 19.” The same rule says “A motion making any of these defenses shall be made before pleading if a further pleading is permitted.” In a contract case, defense (e), failure to state a claim, carries most motions. Rule 12.01 provides that “Defendant shall serve an answer within 21 days after service of the summons upon that defendant unless the court directs otherwise pursuant to Rule 4.043,” and that “The service of a motion permitted under this rule alters these periods of time.” If the court denies the motion, the answer is due within a period that runs from notice of the court’s action.

The motion is a dispositive motion under the General Rules of Practice, which apply to “motions to dismiss a party or claim, motions for summary judgment and motions under Minn. R. Civ. P. 12.02(a)-(f).” Minn. Gen. R. Prac. 115.01. The moving party obtains a hearing date from the court administrator under Rule 115.02, then pays any required filing fee, serves and “files the documents with the court administrator at least 28 days before the hearing,” including the motion, a proposed order, any affidavits and exhibits, and a memorandum of law, under Rule 115.03. The current rule text controls the calendar. For a broader list of grounds to dismiss a lawsuit before trial, and for what an answer must contain if you answer instead, see those pages.

What standard does a Minnesota court apply to the complaint?

A Minnesota state court denies the motion if any evidence the plaintiff might produce, consistent with the plaintiff’s theory, could support the relief demanded. The court accepts the complaint’s facts as true but is not bound by its legal conclusions.

The Minnesota Supreme Court stated the test in Walsh v. U.S. Bank, N.A., 851 N.W.2d 598 (Minn. 2014): “A claim is sufficient against a motion to dismiss for failure to state a claim if it is possible on any evidence which might be produced, consistent with the pleader’s theory, to grant the relief demanded.” In the same case, the court said “we now decline to engraft the plausibility standard from Twombly and Iqbal onto our traditional interpretation of Minn. R. Civ. P. 8.01.” That means a motion arguing that the plaintiff’s story is unlikely, or thin on facts, generally fails in Minnesota state court. Minn. R. Civ. P. 8.01 requires only “a short and plain statement of the claim showing that the pleader is entitled to relief and a demand for judgment for the relief sought.”

The argument that remains is about law, not likelihood. In Hebert v. City of Fifty Lakes, 744 N.W.2d 226 (Minn. 2008), the court said “We are not bound by legal conclusions stated in a complaint when determining whether the complaint survives a motion to dismiss for failure to state a claim,” and in Bahr v. Capella University, 788 N.W.2d 76 (Minn. 2010), it added that “A plaintiff must provide more than labels and conclusions.” A federal court applies a different standard, covered in the questions below.

What makes a breach of contract complaint vulnerable to dismissal?

A contract complaint is vulnerable when it does not allege, or its own allegations defeat, one of the three elements of the claim. Minnesota’s pleading rules forgive missing detail, so the strongest target is an element the plaintiff cannot truthfully allege.

The Minnesota Supreme Court lists the elements as “(1) formation of a contract, (2) performance by plaintiff of any conditions precedent to his right to demand performance by the defendant, and (3) breach of the contract by defendant.” Lyon Financial Services, Inc. v. Illinois Paper & Copier Co., 848 N.W.2d 539 (Minn. 2014). The question on the motion is whether the facts alleged, read with the contract the complaint references, could satisfy each element.

Three rules narrow the attack:

  1. Conditions precedent. Under Minn. R. Civ. P. 9.03, “it is sufficient to aver generally that all conditions precedent have been performed or have occurred. A denial of performance or occurrence shall be made specifically and with particularity.” A one-line allegation of performance is therefore enough at this stage, and your answer must identify specifically which condition did not occur.
  2. Fraud counts. Rule 9.02 requires that “In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity.” A fraud count added to a contract case without who, what, and when is a fair target.
  3. Vague complaints. If a complaint “is so vague and ambiguous that a party cannot reasonably be required to frame a responsive pleading,” Rule 12.05 lets you move “for a more definite statement before interposing a responsive pleading.” That motion asks for detail rather than dismissal.

A bare damages figure is not a pleading defect. Rule 8.01 says that when unliquidated damages over $50,000 are demanded, “the pleading shall state merely that recovery of reasonable damages in an amount greater than $50,000 is sought.” In my practice, when a client asked whether a contract claim that named no specific loss could be dismissed at the start, I explained that the motion would likely fail, because Minnesota’s lenient pleading rules let a contract claim go forward without a proven loss, and that the lack of harm becomes a stronger defense at summary judgment, after discovery shows what was actually lost.

What can the court consider besides the complaint?

On a motion to dismiss, the court reads the complaint and the documents the complaint references, such as the contract itself. Anything else you submit, such as an affidavit or your own emails, can turn the motion into a summary judgment motion.

In Northern States Power Co. v. Minnesota Metropolitan Council, 684 N.W.2d 485 (Minn. 2004), the court said “a court may consider documents referenced in a complaint without converting the motion to dismiss to one for summary judgment.” It then held that an affidavit the petition did not reference required conversion: “having considered the affidavit, it was error for the district court not to have treated the motion as one for summary judgment under Rule 56.” The conversion rule is in Rule 12.02 itself: when “matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56.”

The referenced-documents rule often helps the defense in a contract case, because a complaint for breach of contract usually references the contract sued on. If the contract’s text defeats the claim, the complaint’s reference to that contract puts the text before the judge.

When does an affirmative defense justify dismissal?

An affirmative defense, such as release, the statute of limitations, or the statute of frauds, is one your company raises. If a defense depends on other evidence, Rule 12.02 treats the motion as one for summary judgment once that evidence is presented and not excluded.

Minn. R. Civ. P. 8.03 lists the affirmative defenses, including “release, res judicata, statute of frauds, statute of limitations, waiver, and any other matter constituting an avoidance or affirmative defense.” In Hansen v. U.S. Bank Nat’l Ass’n, 934 N.W.2d 319 (Minn. 2019), the court said “An assertion that the statute of limitations bars a cause of action is an affirmative defense and ’the party asserting the defense has the burden of establishing each of the elements.’” It added: “We will not make inferential leaps in favor of the defendant to conclude that a lawsuit is time-barred.” The court reversed the court of appeals’ decision affirming the dismissal and remanded to the district court to reinstate the complaint.

Other defenses are covered in defenses to a breach of contract claim in Minnesota.

How do limitations and the statute of frauds work at the pleading stage?

A limitations defense supports dismissal only when it is clear from the allegations in the complaint that the period has run. The statute of frauds bars an action on certain agreements unless the agreement or a note or memorandum of it is in writing and subscribed by the party charged.

In Hansen, the Minnesota Supreme Court said “a motion to dismiss should be granted only when it is clear from the stated allegations in the complaint that the statute of limitations has run.” The Minnesota Court of Appeals had put the rule this way: “A motion to dismiss may be proper, however, when it is clear and unequivocal from the face of the complaint that the statute of limitations has run on all the claims asserted.” Jacobson v. Board of Trustees, 627 N.W.2d 106 (Minn. App. 2001). In Park Nicollet Clinic v. Hamann, 808 N.W.2d 828 (Minn. 2011), a physician sued his clinic over a length-of-service policy, and “In lieu of answering, Park Nicollet filed a motion to dismiss for failure to state a claim pursuant to Minn. R. Civ. P. 12.02(e), arguing that the statute of limitations had expired.” The Minnesota Supreme Court held that the claim accrued when the clinic refused to honor the policy and reversed the court of appeals, leaving the dismissal in place.

Which period applies depends on the contract. Minn. Stat. § 541.05, subd. 1 provides: “Except where the Uniform Commercial Code otherwise prescribes, the following actions shall be commenced within six years: (1) upon a contract or other obligation, express or implied, as to which no other limitation is expressly prescribed.” For a sale of goods, Minn. Stat. § 336.2-725 provides: “An action for breach of any contract for sale must be commenced within four years after the cause of action has accrued.” The same subsection adds: “By the original agreement the parties may reduce the period of limitation to not less than one year but may not extend it.” Other statutes set periods for particular claims (Park Nicollet itself applied a different limitations statute), and accrual turns on the facts, so the current statute text and your own dates control. A summary of Minnesota limitations periods for business claims is on a separate page.

Minnesota’s general statute of frauds, Minn. Stat. § 513.01, says “No action shall be maintained” on certain agreements unless the agreement, or a note or memorandum of it, “is in writing, and subscribed by the party charged therewith.” The covered agreements include “(1) every agreement that by its terms is not to be performed within one year from the making thereof” and “(2) every special promise to answer for the debt, default or doings of another.” For goods, Minn. Stat. § 336.2-201 makes “a contract for the sale of goods for the price of $500 or more” unenforceable without a signed record, but subsection (3) lists exceptions, including where the defendant “admits in pleading, testimony or otherwise in court that a contract for sale was made.” An admission in your own answer or testimony that a contract for sale was made can therefore make the contract enforceable up to the quantity of goods admitted. Subsection (3) also makes the contract enforceable “with respect to goods for which payment has been made and accepted or which have been received and accepted (section 336.2-606),” and subsection (2) adds a separate rule “Between merchants if within a reasonable time a record in confirmation of the contract and sufficient against the sender is received,” unless the recipient gives notice of objection in a record within the time that subsection sets. More on exceptions to the statute of frauds.

How do forum selection and arbitration clauses move the case?

A forum-selection clause can support dismissal of a Minnesota case filed in the wrong place, and an arbitration clause can send the claim to arbitration and pause the lawsuit. Both rest on the contract the plaintiff is suing on.

In Hauenstein & Bermeister, Inc. v. Met-Fab Industries, Inc., 320 N.W.2d 886 (Minn. 1982), a Minnesota buyer sued a Florida seller over a used press brake in Hennepin County despite a Florida forum clause, and the Minnesota Supreme Court affirmed the dismissal. The court held that a forum agreement “should be given effect unless it is shown by the party seeking to avoid the agreement that to do so would be unfair or unreasonable,” and it grouped unreasonableness into three categories: “(1) the chosen forum is a seriously inconvenient place for trial; (2) the choice of forum agreement is one of adhesion; and (3) the agreement is otherwise unreasonable.” The burden is on the party resisting the clause, which helps the party relying on it. More on venue clauses that fail.

An arbitration clause works through a different motion. Under Minnesota’s arbitration act, a court asked to compel arbitration orders it unless it finds no enforceable agreement to arbitrate, and Minn. Stat. § 572B.07(f) provides: “If the court orders arbitration, the court shall on just terms stay any judicial proceeding that involves a claim subject to the arbitration.” In federal court, the Federal Arbitration Act says the court “shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration.” 9 U.S.C. § 3. Under both statutes, the result is a stay of the lawsuit while the arbitration proceeds, not a ruling on the merits. More on compelling arbitration in Minnesota.

What happens to tort and unjust enrichment counts pleaded with the contract claim?

Tort counts that only restate the contract breach, and unjust enrichment counts covering a subject a valid contract governs, are common targets in a contract case. Minnesota’s rules also let a plaintiff plead alternative theories, which limits how much of this can be cleared at the start.

On torts, the Minnesota Supreme Court held after a jury trial in Wild v. Rarig, 234 N.W.2d 775 (Minn. 1975) that “when a plaintiff seeks to recover damages for an alleged breach of contract he is limited to damages flowing only from such breach except in exceptional cases where the defendant’s breach of contract constitutes or is accompanied by an independent tort.” On equitable claims, the court said in United States Fire Insurance Co. v. Minnesota State Zoological Board, 307 N.W.2d 490 (Minn. 1981) that “equitable relief cannot be granted where the rights of the parties are governed by a valid contract.” Both rules give a defendant arguments against duplicate counts. On the other side, Minn. R. Civ. P. 8.05 provides that “A party may set forth two or more statements of a claim or defense alternatively or hypothetically, either in one count or defense or in separate counts or defenses,” so a plaintiff may plead unjust enrichment as an alternative to the contract count. More on Minnesota’s economic loss rule.

A remedy limit in the contract can also cap a claim, but for a sale of goods the Uniform Commercial Code limits that argument. Under Minn. Stat. § 336.2-719, “Where circumstances cause an exclusive or limited remedy to fail of its essential purpose, remedy may be had as provided in this chapter,” and “Consequential damages may be limited or excluded unless the limitation or exclusion is unconscionable.”

What does the ruling on the motion change for your company?

A granted motion often leads to an amended complaint rather than the end of the case, and a denied motion sends you to the answer with your failure-to-state-a-claim defense preserved. The motion also locks in some defenses and forfeits others.

  • Amendment. Under Minn. R. Civ. P. 15.01, “A party may amend a pleading once as a matter of course at any time before a responsive pleading is served.” After that, “a party may amend a pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires.” A dismissal for a curable gap usually invites a better-drafted complaint.
  • Preserved defense. Under Minn. R. Civ. P. 12.08(b), “A defense of failure to state a claim upon which relief can be granted” may be made in the answer, “by motion for judgment on the pleadings, or at the trial on the merits.” Rule 12.03 allows that later motion “After the pleadings are closed but within such time as not to delay the trial.”
  • Waived defenses. Rule 12.07 bars a second motion on a defense “then available” but left out of the first, “except a motion as provided in Rule 12.08(b) hereof on any of the grounds there stated,” and Rule 12.08(a) says lack of personal jurisdiction, insufficiency of process, and insufficiency of service of process are waived if “omitted from a motion in the circumstances described in Rule 12.07.” Every available service and jurisdiction objection should therefore go in the first motion.
  • Certification. The attorney who signs the motion certifies under Minn. R. Civ. P. 11.02 that “the claims, defenses, and other legal contentions therein are warranted by existing law or by a nonfrivolous argument for the extension, modification, or reversal of existing law or the establishment of new law.”

The decision to file should weigh what the motion will cost, what it can end or move, and what it shows the plaintiff about your defense.

Should we move to dismiss a complaint that only says damages exceed $50,000?

Usually not on that ground alone. Minn. R. Civ. P. 8.01 requires that form: when unliquidated damages greater than $50,000 are demanded, the pleading shall state merely that recovery of reasonable damages in an amount greater than $50,000 is sought. Under the Minnesota Supreme Court’s standard in Walsh v. U.S. Bank (2014), a claim survives if relief is possible on any evidence consistent with the plaintiff’s theory. The amount and proof of the loss are usually tested later, in discovery and at summary judgment.

Can we attach our own emails to a motion to dismiss?

Only if the complaint references them. The Minnesota Supreme Court has said that a court may consider documents referenced in a complaint without converting the motion to dismiss to one for summary judgment. Under Minn. R. Civ. P. 12.02, if, on a motion asserting failure to state a claim, other matters outside the pleading are presented and not excluded, the motion is treated as one for summary judgment under Rule 56, and every party gets a reasonable opportunity to present its own material. Attaching your own emails therefore usually changes the motion you are bringing.

Is the motion worth filing if the plaintiff can simply amend?

It depends on the defect. Under Minn. R. Civ. P. 15.01, leave to amend shall be freely given when justice so requires, so a curable gap, such as a missing allegation, often produces a better complaint rather than a dismissal. Rule 15.01 also lets a party amend a pleading once as a matter of course at any time before a responsive pleading is served. A motion is more useful when the problem cannot be pleaded around: a limitations defense clear from the complaint’s own allegations, a forum-selection clause, or an arbitration agreement. The decision should weigh what the motion shows the plaintiff about your defense against the cost of answering an amended complaint.

Does a federal court apply the same standard?

No. Federal courts apply the plausibility standard from the U.S. Supreme Court’s Twombly and Iqbal decisions, which the Minnesota Supreme Court declined to adopt in Walsh v. U.S. Bank (2014). Fed. R. Civ. P. 12(b) also lists improper venue as a motion defense, which the Minnesota rule does not. Under both rules, a motion for failure to state a claim that relies on matters outside the pleadings, presented to and not excluded by the court, is treated as a summary judgment motion.

Can we recover our attorney fees if the court dismisses the case?

As a general rule, not without a contract or statute that authorizes it. In Kallok v. Medtronic, Inc., 573 N.W.2d 356 (Minn. 1998), the Minnesota Supreme Court said the American rule “prevents a party from shifting its attorney fees to its adversary without a specific contract or statutory authorization.” A fee clause in the contract the plaintiff is suing on is therefore worth reading before you decide whether to file.

What if the contract requires arbitration and the plaintiff sued anyway?

You can ask the court to order arbitration under Minn. Stat. § 572B.07. Unless the court finds that there is no enforceable agreement to arbitrate, it shall order the parties to arbitrate, and it may not refuse because the claim lacks merit or grounds for the claim have not been established. If the court orders arbitration, it shall on just terms stay any court proceeding that involves a claim subject to the arbitration.

Weighing a Motion to Dismiss

A motion to dismiss a contract claim in Minnesota state court works best when the problem cannot be fixed by better drafting: a limitations defense clear from the complaint’s own allegations, a forum-selection or arbitration clause, or a missing element the plaintiff cannot truthfully allege. A motion that argues the claim is weak or short on detail usually fails under Walsh, and a dismissal for a curable gap often produces an amended complaint. If you would like a second set of eyes on a contract lawsuit your company has been served with, email me at aaron@aaronhall.com with a brief description. I start an intake and conflict check before you send confidential documents, such as the complaint. More on contract disputes is on my contracts page.