Justia Contracts Opinion Summaries

After Homeowners' house burned down, Homeowners' insurer denied coverage, stating that payment was not timely delivered, the money order was not signed, and the damaged house was the secondary house and Insurer's underwriting policies required insurance on the primary house also to be purchased through Insurer in order to have coverage in place for the secondary residence. Homeowners filed suit, asserting that no reasonable basis in fact or law existed for denial of the claim and seeking damages and a declaratory judgment that the loss was covered. The district court granted Insurer's motion for summary judgment and denied Homeowners' motion for partial summary judgment with respect to their declaratory judgment action. The Supreme Court reversed in part and affirmed in part, holding (1) the district court erred in granting summary judgment to Insurer as genuine issues of material fact remained, and (2) the district court did not abuse its discretion in denying Homeowners' motion for partial summary judgment.

Stephen and Dawn Steadele contracted with Montana Component Housing Corporation (MCHC) to construct a home. MCHC did not complete the home by the deadline and eventually abandoned the project without completing the home. The Steadeles filed suit against MCHC. The district court entered a default judgment against MCHC when it failed to respond to the suit. The Steadeles then requested payment from Colony Insurance Company, MCHC's insurer. Colony denied coverage and refused to pay because MCHC never notified it of the Steadeles' claim. The Steadeles then filed this action, arguing that Colony's refusal to issue payment on the underlying judgment was a violation of Mont. Code Ann. 33-18-201, which prohibits unfair claim settlement practices. The district court granted summary judgment to Colony. The Supreme Court affirmed, holding that the district court did not err in granting summary judgment to Colony because MCHC's failure to notify Colony of the Steadeles' claim was a material breach of MCHC's obligations under the policy.

Timothy Hop's automobile was damaged in an accident with a driver insured by Safeco Insurance Company. In addition to the costs of repair, Hop sought "residual diminished value" (RDV) for his vehicle. When Safeco failed to pay RDV, Hop filed a class action complaint for declaratory relief in the district court, seeking a declaration that Safeco was required to investigate and pay class members, people whose vehicles were damaged by a Safeco insured and who were not paid RDV by Safeco, for RDV of their vehicle. The district court granted Hop's motion for class certification. The Supreme Court reversed, holding that the district court abused its discretion in certifying a class action before Hop had satisfied the statutory requirements to bring an individual third party action against Safeco. Remanded with instructions to dismiss Hop's class action without prejudice.

Appellant, Summer Night Oil Company, and Appellees, individuals and oil companies, resolved a dispute over the operation of two oil wells through a settlement agreement. Appellant filed a motion to compel performance of the agreement after the parties failed to perform timely their obligations under the agreement. Specifically, Appellant asked the district court to compel Appellees to deliver all title clearance documents under the agreement. Appellees responded with a request to compel Appellant to pay a fine due to the EPA and a payment owed to Appellees under the agreement. Both parties sought attorney fees. The district court enforced what it determined to be the plain meaning of the agreement's terms, and (1) ordered Appellant to pay the fine owed to the EPA, (2) ordered Appellant to pay Appellee the amount owed it under the agreement, (3) ordered Appellees to deliver all title clearance documents to an escrow agent, and (4) declined to award attorney fees to either party. The Supreme Court affirmed, holding (1) the district court properly denied Appellant's motion to compel performance of the agreement according to Appellant's terms, and (2) the district court correctly denied Appellant's motion to alter or amend its judgment.

Joseph Graziano, an owner of property in the Stock Farm subdivision and a member of the Stock Farm Homeowners Association, filed a complaint against the Association and Stock Farm LLC (SFLLC), asserting several claims, including negligence, breach of fiduciary duties, defamation, and constructive fraud. The Association and SFLLC moved to stay the proceedings and compel arbitration pursuant to a provision of Stock Farm's Covenants, Conditions, and Restrictions (CCRs). The district court granted the motion, finding the CCRs were an enforceable agreement to arbitrate all the claims in Graziano's complaint. On review, the Supreme Court affirmed in part and reversed in part, holding (1) the district court did not err in finding the CCRs were not a contract of adhesion and were within Graziano's reasonable expectations, and thus were enforceable; (2) the district court erred in finding Graziano's claim of breach of fiduciary duty was not a personal injury claim exempt from arbitration under Mont. Code Ann. 27-5-114(2)(a); and (3) all of Graziano's remaining claims were subject to the valid and enforceable arbitration provision and must be arbitrated pursuant to the CCRs. Remanded.

C.R. Weaver ordered a coffee urn from defendant Advanced Restaurant Supply for use by Glacier Kitchens, a corporation in which Weaver owns the majority of the shares. Advanced Restaurant sent a coffee urn it ordered from defendant Wilbur Curtis Manufacturing. Glacier Kitchens used the urn to provide drink for forest firefighters under its food service contract with the United States Forest Service (USFS). The coffee urn ultimately malfunctioned, and, later, Glacier Kitchens' contract with the USFS was terminated by USFS. Weaver sued defendants for breach of contract, alleging that a contract attached when he ordered the coffee urn. The district court granted summary judgment to defendants, finding that Weaver, as a shareholder in Glacier Kitchens, lacked standing to bring a claim that belonged to the corporation. The Supreme Court affirmed, holding (1) the district court properly granted summary judgment to defendants; and (2) the district court properly awarded costs to defendants.

Donovan Donald (Don) was incapacitated in an accident and received several treatment in Kalispell Regional Medical Center (KRMC). Later, a dispute arose between Don's estate and KRMC over KRMC's acceptance or rejection of Medicaid's payments for Don's care. KRMC filed liens against the Estate. The Estate, in turn, sued KRMC and MASH, a company that had provided Medicaid application forms to the Estate, under several theories of liability. The district court granted Defendants' motions for summary judgment. The Supreme Court affirmed, holding the district court (1) did not err in granting summary judgment to KRMC and MASH; (2) correctly interpreted and applied the Montana Medicaid Act; (3) correctly awarded KRMC prejudgment interest but incorrectly included interest KRMC received from its interest-bearing account; and (4) did not abuse its discretion by awarding KRMC attorney fees and costs. Remanded with instructions to offset the prejudgment interest award by the amount of interest KRMC received from the interest-bearing account.

Russell and Melissa Levens and Al Ballard, neighboring property owners, entered into an agreement defining the location of the boundaries of their properties. The agreement provided that Ballard would not excavate on his property within thirty feet of the Levens' property. After Ballard occupied the area between the two properties and refused to sign a certificate of survey pursuant to the agreement, Levens brought an action against Ballard to enforce the agreement and for an injunction. The district court enjoined Ballard from excavating on the disputed property and later granted Levens' motion for summary judgment. Levens later filed a motion for contempt against Ballard for failure to abide by the judgment. The district court denied the motion and entered an order awarding attorney fees to Ballard. On appeal, the Supreme Court reversed the orders, holding that the judgment must be construed to prevent Ballard from excavating in such a way that the pit intrudes into the thirty-foot buffer strip at the edge of Levens' property.

Plaintiff Leonard Brown entered into an employment agreement with the Yellowstone Club that employed Brown for a term of three years and provided that Brown's employment could be terminated at any time without cause. After six months, the Club terminated Brown's employment without cause. Brown brought an action for damages against the Club under the Wrongful Discharge from Employment Act. The district court granted the Club's motion to dismiss the action based upon Mont. Code Ann. 39-2-912(2), which exempts from the Act an employee covered by a "written contract of employment for a specified term." The Supreme Court reversed the judgment of the district court, holding that if an employment contract for a specific term also allows the employer to terminate at will, it is not a "written contract for a specific term" under Section 39-2-912. Therefore, a discharged employee covered by such a contract is not excluded by the statute from bringing a claim under the Act.

Gary Hoff filed a complaint alleging contract and negligence claims against Countrywide Home Loans, Inc. and Lake County Abstract & Title Company. Countrywide failed to appear or answer within the 20 days permitted by Mont. R. Civ. P. 12(a), after which Hoff moved for entry of default against Countrywide. Countrywide later attempted to reverse the default proceedings with a motion to set aside the default pursuant to Mont. R. Civ. P. 55(c) and then a Mont. R. Civ. P. 60(b) motion to set aside the entry of default for mistake or excusable neglect. The court denied the motions and entered a default judgment against Countrywide. Countrywide appealed and Hoff cross-appealed. The Supreme Court affirmed, holding (1) the district court did not err in its judgment against Countrywide because pursuant to Cribb v. Matlock Commc'n, Inc., good cause did not exist to set aside the entry of default, and (2) the district court did not err as Countrywide's 60(b) motion was procedurally defective. Lastly, the Court concluded the district court correctly denied Hoff's request for attorneys fees because the contract did not entitle either party to attorneys fees under the circumstances.