Justia Contracts Opinion Summaries

Defendant-Appellant Robert Shipley appealed a district court order which granted summary judgment in favor of Plaintiff-Appellee BNSF Railway Company. BNSF leased commercial property in Miles City, Montana, to Shipley. The lease provided that either party could terminate the lease upon 30 days written notice. Shipley failed to pay rent to BNSF for a number of years. This failure by Shipley resulted in overdue rent payments of $17,700. BNSF notified Shipley on January 7, 2011, that the Lease Agreement would be cancelled and terminated in 30 days, effective on February 10, 2011. The Lease Agreement also required that Shipley remove all improvements and personal property from the leased premises within the 30 days of the lease termination. Shipley failed to remove the items. BNSF provided Shipley with a 60 day extension to remove the items. Shipley again refused to remove the items. Shipley’s refusal prompted BNSF to file a complaint to quiet title to the improvements and personal property, a declaratory judgment that BNSF had terminated the lease validly, trespass, unlawful detainer, and claim for reasonable rent. Shipley acknowledged that he owed $17,700 in rent. Upon review, the Supreme Court concluded that no genuine issue of material fact existed and that the district court correctly granted summary judgment.

Appellants James J. and Linda L. Clark appealed a district court order that approved the filing of an amended certificate of survey, approved a settled agreement, and required each party to pay one-half of the fees and costs relative to a surveyor agreed upon by the parties. Appellees Bill and Katy Martin purchased the Fishtail General Store from Clarks in May 2000. The sewer system for the Fishtail General Store failed in July 2005. Keith Brown, a licensed Professional Engineer, designed a replacement septic wastewater disposal sewer system. The Stillwater County Health Department issued a replacement sewer system permit, and the Martins installed the new sewer system north of the Fishtail General Store on "Tract 2-A." A number of unresolved issues remained between Clarks and Martins. Clarks and Martins ultimately jointly petitioned to relocate the boundary lines between Tract 2-A and property owned by Clarks. The District Court approved the boundary line relocation. This relocation reduced the size of Tract 2-A. The new sewer system failed again in 2009. Martins requested that Clarks allow Martins to use land located outside the adjusted boundary line to install the two additional laterals. Clarks refused. Martins filed a motion pursuant to M. R. Civ. P. 60(b)(6) for relief from the district court’s order of June 7, 2006 that had approved the boundary line relocation. The parties advised the District Court at the conclusion of a pre-trial conference that they had reached a settlement. The court ordered the parties to hire Tom Kelly, a licensed surveyor, to prepare a certificate of survey that would implement the Septic System Easement Agreement. Martins then filed a motion asking the court to approve a Corrected Tract 2-A Amended Certificate of Survey prepared by Kelly. Clarks argued on appeal to the Supreme Court that the District Court incorrectly determined that the Corrected Tract 2-A'a Amended COS did not change the boundaries between the Clarks’ and Martins’ tracts. Clarks further contended that the District Court improperly concluded that Martins’ proposed septic system agreement accurately reflected the agreement of the parties. Upon review, the Supreme Court concluded that there was substantial evidence in the district court record to support the court's ultimate decision in this case. Accordingly, the Court affirmed the district court's decision.

The district court determined that Plaintiffs Nigel and Jami Davis held an easement over the properties of Defendants, four property owners, and that the Davises could use the easement for the purpose of accessing their nearby property. The district court permanently enjoined Defendants from placing any gate across the easement unless they provided the Davises with a means to pass through the gate. The Supreme Court affirmed, holding (1) a 1974 declaration of easements and a 1974 certificate of survey referenced in the declaration were sufficient to create an access easement benefitting the Davises' off-survey property; and (2) an express easement may be appurtenant to noncontinguous property if both tenements are clearly defined and it was the parties' intent that it be appurtenant.

Defendant entered into a contract for deed for the sale and purchase of Plaintiffs' building. After Defendant discontinued making payments and failed to pay property taxes as required by the contract, Plaintiffs obtained Defendant' quit claim deed from escrow, recorded it, retook possession of the building, and resold the contract. Plaintiffs then filed suit against Defendant for breach of contract. Defendant moved to summary judgment, arguing that because Plaintiffs chose to terminate the contract, take possession, and retain contract payments as liquidated damages rather than sue for the accelerated balance and additional damages under the contract, their breach of contract action was precluded under the election of remedies doctrine. The district court granted summary judgment in favor of Defendant. The Supreme Court affirmed, holding that Plaintiffs elected to invoke the remedy of terminating the contract and retaking possession of the property, and that election, under the contract provisions at issue, precluded the additional relief sought here.

Cassadie and Chris Parish were injured in a motor vehicle accident when their vehicle was struck by an uninsured driver. United Financial Casualty Insurance Company (UFC) provided insurance coverage to the Parishes, including uninsured motorist (UM) coverage. The Parishes, who had two vehicles insured on their UFC policy at the time of the accident, argued they should be permitted to stack the UM benefits provided in their policy. UFC refused, stating that the Parishes' policy did not allow stacking. The Parishes sued seeking declaratory judgment. The district court granted summary judgment in favor of UFC. The Supreme Court affirmed, holding that the district court did not err in granting UFC's motion for summary judgment, as, inter alia, the policy was unambiguous and UFC's insurance agreement did not create a reasonable expectation of stacked UM coverage.

Appellees, Kristine Kittleson and James Kurtzenacker, purchased property pursuant to a warranty deed that referenced surveys conducted by Davis Surveying. Appellants, Davis Surveying and Kenneth Davis claimed they had nothing to do with Appellees until after they had purchased their property. Appellees sued Appellants, alleging negligent misrepresentation, negligence, and breach of contract based on a third-party beneficiary theory and claiming that because of Clark's incorrect flagging, they trespassed on neighboring property and needed to remove part of their landscaping and construction work. The district court held that Appellants were liable for breach of contract under a third-party beneficiary theory and for negligent misrepresentation. The Supreme Court affirmed in part and reversed in part, holding (1) the district court erred in determining that Appellees were third-party beneficiaries of a contract for a prior survey, but while the court erred in this reasoning, it reached the right result under Appellees' negligent misrepresentation claim; (2) the court did not err in determining that Appellees were entitled to damages based on negligent misrepresentation; and (3) there was a lack of substantial evidence to support the court's determination that Davis was personally liable to Appellees for work done by Davis Surveying.

Oliver Arlington was employed by Miller's Trucking as a log truck driver and loader operator pursuant to an oral employment agreement. For his work, Miller's paid Arlington twenty-five percent of the "load rate" as calculated by Miller's. Arlington, however, asserted that according to the parties' oral agreement, he should have been paid a salary in the form of annual wages. Arlington filed a wage claim, seeking the pay he alleged he was owed in regular and overtime wages. The Department of Labor and Industry's bureau dismissed Arlington's claim for lack of merit and lack of sufficient evidence. On appeal, a bureau hearing officer dismissed Arlington's claim. The district court affirmed. The Supreme Court reversed, holding (1) the hearing officer acted arbitrarily and capriciously in failing to require Miller's to produce material requested by Arlington and in refusing to admit tendered evidence, prejudicing the substantial rights of Arlington, and the district court erred in affirming the hearing officer's judgment; and (2) the hearing officer and district court incorrectly determined that Arlington engaged in activities of a character directly affecting the safety of the operation of motor vehicles in interstate commerce and thus was exempt from overtime requirements. Remanded.

This appeal arose from a dispute between two neighboring property owners regarding a workshop addition to the home of Appellants, Neil and Seth Milner (Milner). The addition violated the city's setback requirement, and Appellee Gary Olsen reached an agreement with Milner to sell strip of his property so the building would be in compliance. The parties disagreed, however, about the terms of the agreement. Milner filed suit, and the district court rescinded and set aside the agreement. Olsen was ordered to return Milner's money and costs, and Milner was required to deed the land back to Olsen. After Olsen discovered that Milner's addition encroached past the boundary line of his property, Olsen filed suit alleging trespass and nuisance. The district court found in favor of Olsen and ordered Milner to remove the addition. The Supreme Court affirmed, holding that the district court did not err in determining (1) Olsen's claims were not barred by res judicata; (2) Olsen's claims were not barred by equitable estoppel or waiver; and (3) Milner was liable to Olsen for trespass.

Appellants, three licensed clinic psychologists, were former partners of Great Falls Clinic, LLP, a general limited liability partnership comprised of medical professionals. The Clinic partners, including Appellants, signed a partnership agreement stating that a partner who separates from the partnership in compliance with the agreement's terms will receive a partnership interest subject to reduction for competing after withdrawal or retirement. Appellants subsequently separated from the Clinic and filed a declaratory judgment action when the Clinic refused to pay them their full partnership interest payments. At issue was whether the agreement's restriction, which applied to those engaged in the "practice of medicine," included partners who practiced psychology after separating from the Clinic. The district court granted summary judgment for the Clinic. The Supreme Court affirmed, holding that the district court did not err by (1) holding that the Appellants engage in the "practice of medicine" as used in the partnership agreement; and (2) concluding that the parties' intention regarding the term "practice of medicine" in the language of the agreement was to include the psychologists.

After a dispute over the purchase of a motor coach, Plaintiff brought suit against Defendants, a used car salesman, a used car dealership, and a bank, asserting claims of, inter alia, breach of contract, fraud, and negligent misrepresentation. Plaintiff subsequently filed a motion to compel discovery, which the district court granted. Defendants did not meet their discovery deadlines, and Defendants' counsel failed to attend several status conferences. The district court then entered a default judgment for Plaintiff as a discovery sanction and later and awarded Plaintiff $74,154 in damages. The Supreme Court affirmed in part and reversed in part, holding that the district court (1) did not abuse its discretion when it entered a default judgment for Plaintiff as a discovery sanction under Mont. R. Civ. P. 37(b); (2) did not abuse its discretion when it refused to set aside the sanction orders; (3) did not err as a matter of law in calculating damages; but (4) failed to property calculate and award prejudgment interest. Remanded.