Perspectives: Courses, links lawsuits proliferate in Minnesota

Marshall H. Tanick//August 10, 2026//

A golf ball shown just outside a hole with the sun low on the horizon

Marshall H. Tanick//August 10, 2026//

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NOTE: This is the first of two parts

Minnesota’s short but enjoyable golf season is reaching the back nine, with another month to go before “fall golf.”

About 12% of Minnesotans engage in the sport, excluding those who partake in the miniature version of the game replete with windmills and other obstacles.

Those who play the game without the windmills give the state the highest percentage in the community of public courses, about 90% of the approximately 500 links.

This figure may explain the sizeable amount of litigation related to golf in the state.

Golf got a big boost here this summer by the Women’s PGA Championship, one of four majors played at Hazeltine golf course in Chaska and won by Haeran Ryu, one of the many Korean golfers who are pre-eminent on the ladies tour. And the 3M Men’s Open at the TPC Twin Cities course in Blaine featured top men’s money winner Scotty Scheffler, who finished second to Jackson Koivu, who overcame a record-tying 59 shot in the second round of the four-day event by Michael Kim, who finished tied for 10th.

Interest in golf this season also is heightened by the new Netflix series “The Hawk,” starring comic actor Will Farrell as a faded golf star trying to regain his glory after missing an easy putt that cost him a major championship years ago. The critics have been unkind to the 10-part, 30-minute series, but it’s an enjoyable tour de force for links lovers.

That group and others are also indulging in another summertime feature, reviewing the case law on golf in this state. Here’s the first a two-part series for those devotees of golf, law, either, or both.

“The game of golf is 90% mental and 10% principle.”
Jack Nicklaus, 18 Golf “Major” titles (1940 – )

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“The more I practice golf, the luckier I get.”
Gary Player, part of 1960s “Big Three” (1935 – )

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“Golf is the closest to the game we call life … you have to play the ball where it lies..”
Bobby Jones, legendary 1930 “Grand Slam” winner, including U.S. Open at Interlachen in Edina (1902-1971)

Business battles

A falling out between owners of a golf-related business resulted in imposition of personal liability upon the guarantors of a promissory note in TriCountry State Bank of Ortonville v. Golf Properties Inc., 395 N.W.2d 409 (Minn. App. 1986). Six months after they relinquished their shares in the company, two shareholders signed “absolute, unconditional and continuing” personal guarantees to the bank for what they thought was short-term financing. They claimed they were told by the other shareholders that they would be released from the guarantees as soon as the debt was replaced with other financing. But the bank later sued on the guarantees and the Hennepin County District Court held the former shareholders liable.

The appellate court affirmed, rejecting their assertion that the bank was aware that they were no longer shareholders in the company and were only providing the guarantees until new financing was in place. Any agreement the shareholders had between themselves “is irrelevant to the bank’s right to proceed” against the signatories, particularly in the absence of any evidence that the bank waived its rights against the shareholders

Another heated golf course financial dispute was addressed in Sievert v. First National Bank, 358 n.w.2D 409 (Minn. App. 1984), in which a bank financed construction of a 68-acre golf course in Lakefield in southwestern Minnesota. The case arose after a series of transactions were made in an attempt to shore up the financially failing course. The owners of the course ultimately prevailed before a Jackson County District Court, obtaining a verdict of $225,000 including $175,000 in lost profits, against the bank for being forced to transfer the course in order to obtain refinancing of indebtedness and for a prospective sale that fell through. Meanwhile, the bank’s claim for an unpaid loan was denied.

The appellate court reversed, noting that there were “several flaws” in the proceedings, including the failure to apply the proper standard of “honesty in fact” under the Uniform Commercial Code, rather than the “standard of commercial reasonableness” used by the trial court. But the main deficiency was that the jury’s verdict was “tainted by speculation” and encompassed “overlapping items.” The main potential value of the golf course and its anticipated profits, which were based on the “unsubstantiated, self-serving prediction” of its principal owner. The damages were “too uncertain” because the course never generated profits.

The court also condemned the conduct of the attorney for the claimant who was “consistently rude, argumentative, and abusive to witnesses and the Court.” The court also lambasted the attorney for “unwarranted and totally unprofessional” conduct in examining an expert witness, which “exceeded all legitimate boundaries of vigorous cross-examination” and which it viewed as an attempt to “humiliate a witness for self-gratification.” Accordingly, the verdict was reversed and the trial court was directed to enter judgment for the bank in the amount of the unpaid loan.

The owner of an indoor recreation and golf entertainment center was held to a listing agreement with a real estate broker and obligated to pay a commission to the broker in 20/20 Group Inc. v. Pure Golf Inc., 2000 WL 462978 (Minn. App. 04/25/00) (unpublished). The agreement provided for a commission of 8% if the broker provided for a “ready, willing and able” purchaser during two years, and also included a clause providing that any potential purchaser who came forward during that period would be placed on a “protective list” and would be subject to a commission if they bought the facility after the listing expired.

Shortly after the listing expired, the owner leased the center with an option to purchase to a couple, who were on the “protective list.” This transaction triggered a claim for commission by the broker.

Affirming a ruling of the trial court, the appellate court held that the broker was entitled to a commission for the transaction. The listing agreement was not ambiguous since it specifically included any leases. The lessees “became aware of the business through the efforts of the broker” and were explicitly identified on the “protective list.” The court rejected the owner’s claim that he and been fraudulently induced to enter into the listing agreement based upon a representation by the broker that a commission would only be due if the broker actually sold the business. Reliance upon any oral representation was not justifiable since it “plainly contradicts” explicit terms of the written agreement.

A restrictive covenant requiring the original owner of a golf course be provided with free golf club memberships did not apply to future purchasers in McKush v. Hecker, 559 N.W.2d 725 (Minn. App. 1997). The original owner sold the course in Scott County, reserving a right to six free golf club memberships and further requiring that the purchaser extend this obligation to “his buyer” in the event of the sale of the premises. The golf course was subsequently sold, with no reference to the original owner’s free golf course membership. The new owners and the original developers then litigated the issue whether the free membership provision was binding on future purchasers.

Reversing a ruling of the Scott County District Court, the appellate court held that the “free membership” clause did not encumber the property and therefore, did not apply to future purchaser beyond the first sale. The court relied upon the “overriding principle of law that agreements for use of property are strictly construed against limits on use.” Because the original contract bound only the original buyer and “his buyer,” the free membership did not run with the land or the first buyer’s successors.

Tax topics

Golf is a taxing sport, both literally and figuratively. A number of Minnesota cases have considered tax-related implications of the game.

Annual membership dues received by country clubs are not subject to sales and use tax in Minnesota. In Northland Country Club v. Commissioner of Taxation, 308 Minn. 265, 241 N.W.2d 806 (1976), the Supreme Court reversed a ruling of the St. Louis County District Court, holding that membership dues do not constitute payments for the “use of amusement devices” and that a country club did not constitute a “place of amusement,” nor were its facilities “amusement devices” for purposes of imposing a sales and use tax.

While the imposition of a sales and use tax upon such membership fees constituted a “rational” interpretation of the sales tax statute, the law was “sufficiently doubtful” to require it to be interpreted in favor of the “taxpayer.” The court noted that the majority of club members “do not play golf at all” and may belong merely to attend social functions or for other purposes. This distinguishes country clubs from those facilities where sales taxes have been imposed on admission fees for use of the facilities. The Court also refused to follow reasoning applied in the case of a bowling alley bingo parlor, noting that the facilities of the golf club were, with limited exceptions, “real property,” and do not constitute an “amusement device” subject to a sales tax. Nor was the country club itself a “place of amusement” for purposes of applying a sales tax. The language of the statute does not extend to “either social clubs or recreational activities.” While statutes in some other jurisdictions, notably Wisconsin, expressly make membership dues subject to sales tax, the Minnesota Legislature chose not to use similar language, an omission that the court deemed to be a “deliberate” means of avoiding such tax.

Sales taxes also are not required to be paid by a company that sells “range” golf balls to owners of practice driving ranges and golf courses. In Spalding & Evenflo Companies, Inc. v. Commissioner of Revenue, 1998 WL 547046 (Minn. Tax Ct. 08/27/98) (unpublished), the Tax Court held that the sales are exempt from sales tax because the balls are used for eventual resale by range and golf courses.

The court rejected the argument of the commissioner of revenue that “range” balls are not resold to customers, noting the issuance of tax exemption certificates to the ranges and courses attesting that their balls are used for eventual resale. Under the exemption statute, a seller is not required to investigate the purchaser’s “ultimate use of the balls.” Thus, “range ball” seller need not collect or pay sales taxes for balls sold to those who have “resale” exemption certificates.

A ruling by the Tax Court partially lowering the property value of a golf course in Dakota County was affirmed by the Supreme Court in Orchard Gardens Country Club, Inc. v. Commissioner of Revenue, 294 N.W.2d 701 (Minn. 1980). The Tax Court affirmed the county assessor’s market value of $3,500 per acre on the property, but it reduced the “open space” value by nearly half to $1,184 per acre. The court affirmed, holding that the nine-hole, par three golf course in Burnsville was properly assessed, as were all of the other golf courses in Dakota County. A uniform $2,200 per acre for valuation of all golf courses in the county was invalid because the underlying statute for taxation of open space property, Minn. Stat. § 273.112, contemplates several classes of open space land and recognizes that open space has different values. Because the Legislature “envisioned varying values of golf courses,” the tax assessor erred in valuing all golf courses in the county equally.

The Tax Court properly determined the value per acre for open space should be based upon the ratio between the highest market value for a golf course in the county and the open space value. This formula makes determination of open space value “a practical and simple” methodology and assures that the open space value will be “directly proportional to the market value.” By assuring that recreational lands will not be taxed at full value, this method encourages “retention of the lands as recreational facilities.”

The value of a country club golf course was properly reduced from $1.7 million to $1.6 million, despite a claim for a $1 million reduction by the owner in Minnetonka Country Club Association, Inc. v. County of Hennepin, 1993 WL 531787 (Minn. Tax Court 12/20/93)(unpublished). The Tax Court, reviewing the market value assessment of a 90-acre country club and par 71 golf course for the third time, found that the county’s assessment was more accurate than the club’s valuation. Rejecting the “income approach” as a “better indication of value” because golf courses are continually “being built and selling for higher prices.” The “cost” approach, consisting of the price paid per hole, excluding buildings, also constituted a “good unit comparison.” Under these circumstances, the facility should have been valued at $1.6 million, about $100,000 below the county’s assessment, and some $1 million above the owner’s appraisal. The court rejected the owner’s claim that the course was “below average” in many respects, noting that it was an “aesthetically attractive, well-maintained course” with rolling fairways, “good definition” and many mature trees. The court also pointed out that the number of rounds played per year had increased, along with a rise in membership. These considerations justified a figure closer to the assessor’s calculation than the owner’s analysis.

Perspective Problem: What Minnesota lawyer was president of the United States Golf Association?

Lawyer’s litigation

No review of golf-related litigation in Minnesota can overlook lawyers. They not only represent parties, they are litigants themselves.

Misconduct relating to golf led to disciplinary action against an attorney in In re Disciplinary Action Against Meaden, 628 N.W.2d 129 (Minn. 2001). The attorney, who was licensed in Minnesota, was suspended from practice in New Jersey for three years, an action which the Supreme Court held warranted “identical discipline” in Minnesota.

The basis of the discipline was identity theft by the attorney, using the name and credit card of someone else, to order golf equipment. The lawyer, who had a bipolar disorder and suffered mental illness, was subject to discipline in Minnesota because he had received “fundamental fairness and due process in the New Jersey proceeding.”

Although criminal records about the attorney had been expunged, he had “admitted misconduct” in New Jersey. Also, the New Jersey proceeding gave significant consideration to the “mitigating factor” of his mental illness.

Attorneys came out more favorably this spring in Star Centers Inc. v. Faegre & Benson L.L.P., 2002 WL 992392 (Minn. 05/16/02) (unpublished) (now known as Faegre & Daniels). A law firm that represented a company in seeking financing for an indoor Twin Cities soccer arena also represented a company from which the financing was sought, which the law firm timely disclosed to the arena client. The finance company later was found to have engaged in fraud in a separate lawsuit involving refusal to finance a golf course in Denver. The law firm represented the prospective financier in that case through the firm’s Denver office, unaware that the law firm’s Minneapolis office represented the arena seeking funding from the same source.

After the financing fell through for the indoor soccer arena in the Twin Cities, the promoter learned of the Denver lawsuit, and the soccer developer sued the law firm claiming it should have disclosed this financing failure.

The Hennepin County District Court granted summary judgment for the law firm, and the appellate court concurred. 2001 WL 605088 (Minn. App. 2001)(unpublished). The Supreme Court affirmed, holding that the law firm did not breach any fiduciary duty to the soccer client because information the law firm knew about the Denver golf course litigation was not “material” to the financing of the Minnesota soccer stadium. The oral allegations of fraud in the Denver financing fiasco were too “unsubstantiated” to create a duty of inquiry by the law firm although the court continued that attorneys in similar circumstances “must be alert to allegations that have truth to them” when coupled with evidence “indicating a colorable claim.”