Case Title: DUSSAULT v HJELM

Citation: 

Docket Number: 80-429

State: montana

Court: Montana Supreme Court

Date: 1981-05-13T00:00:00Z

Document:
No. 80-429 IN THE SUPREME COURT OF THE STATE OF MONTANA 1981 WALTER F. DUSSAULT and ARLENE S. DUSSAULT, Plaintiffs and Respondents, VS . F. HJELM, Defendant and Appellant. Appeal from: District Court of the Fourth Judicial District, In and for the County of Ravalli Honorable James B. Wheelis, Judge presiding. Counsel of Record: For Appellant: John M. McRae argued, Hamilton, Montana For Respondents: Recht and Greef, Hamilton, Montana John D. Greef argued, Hamilton, Montana - Submitted: April 21, 1981 Decided: May 13, 1981 Filed: - M m 1 3 198f -p*ry Clerk M r . J u s t i c e Frank B. Morrison, Jr., d e l i v e r e d t h e Opinion of t h e Court. Defendant, Flo H j e l m , appeals from a judgment of t h e Fourth J u d i c i a l D i s t r i c t , Ravalli County, entered i n favor of p l a i n t i f f s , Walter F. and Arlene S. Dussault. his judg- ment terminated a l e a s e of r e a l property, granted possession of t h e property t o p l a i n t i f f s , held t h a t t h e Landlord and Tenant Act d i d n o t apply thereby e n t i t l i n g p l a i n t i f f s t o t r e b l e damages under t h e unlawful d e t a i n e r s t a t u t e s , and awarded a t t o r n e y f e e s and c o s t s t o p l a i n t i f f s . Flo Hjelm owned property o u t s i d e t h e C i t y of Hamilton, Ravalli County, Montana. O n February 27, 1979, Hjelm s o l d t h i s property t o Walter and Arlene Dussault. The instrument formalizing the terms of t h e s a l e contained a lease-back provision by which Hjelm was given an option t o r e n t t h e buildings on t h e conveyed property along with s i x a c r e s of land. This lease-back provision s t a t e d : "The S e l l e r herein may, a t her option, r e n t from t h e Buyers t h e buildings conveyed by her t o t h e Buyers, together with approximately s i x ( 6 ) a c r e s of land f o r t h e annual r e n t a l of $3,000.00 f o r one year, commencing from t h e d a t e of t h i s agreement and s a i d r e n t s h a l l be payable on o r before December 1, 1979, and it i s f u r t h e r provided t h a t the agree- ment s h a l l be automatically renewed from year t o year unless one p a r t y gives w r i t t e n n o t i c e of a t l e a s t ninety (90) days before the e x p i r a t i o n of the c u r r e n t year of t h e i r i n t e n t t o cancel o r amend the terms. " Hjelm exercised the option t o r e n t and continued i n possession of t h e property. A t t h e t i m e of t h e s a l e and continuing throughout the possession of the property, Hjelm maintained 15 t o 20 horses on t h e property. Hjelm a l s o kept, on an i n t e r m i t t a n t b a s i s , some cows, chickens, a g o a t and o t h e r domesticated animals. On November 9, 1979, Dussaults served n o t i c e upon Hjelm t h a t t h e r e n t a l agreement would terminate on February 27, 1980. Subsequently, a d i s p u t e between t h e p a r t i e s a r o s e re- garding whether t h e f i r s t lease-year ended on December 1, 1979 o r February 27, 1980. A s a r e s u l t of t h e d i s p u t e , ~ j e l m paid only $2,000 r e n t and refused t o vacate t h e premises on February 27, 1979. On March 7, 1980, Dussaults commenced a n a c t i o n under t h e Montana unlawful d e t a i n e r s t a t u t e s . S e c t i o n 70-27-206, MCA, provides f o r an award of t r e b l e damages. Hjelm moved t o dismiss, claiming her occupancy of t h e premises was governed s o l e l y by Montana R e s i d e n t i a l Landlord and Tenant A c t of 1977. (Hereinafter r e f e r r e d t o as t h e Landlord and Tenant A c t . ) Under t h i s A c t t r e b l e damages can only be awarded upon a showing of purposefulness and bad f a i t h . S e c t i o n 70-24-429 ( I ) , MCA. The D i s t r i c t Court granted Dussaults t i m e t o amend t h e i r complaint t o a l l e g e s u f f i c i e n t f a c t s excepting t h e tenancy from t h e province of t h e Landlord and Tenant A c t . Dussaults amended t h e complaint, a l l e g i n g t h a t Hjelm's occupancy w a s exempt from t h e A c t by v i r t u e of t h e " a g r i c u l - t u r a l " exclusion contained i n s e c t i o n 70-24-104 (8) , MCA. Hearing on t h e m a t t e r was held May 30, 1980. On August 15, 1980, t h e D i s t r i c t Court held t h a t t h e l e a s e agreement was excluded from t h e Landlord and Tenant A c t . The ~ i s t r i c t Court rendered judgment i n favor of t h e Dussaults i n accordance w i t h Montana unlawful d e t a i n e r provisions. The d i s p o s i t i v e i s s u e on appeal is: 1. Whether t h e D i s t r i c t Court e r r e d i n concluding t h a t t h e a c t i o n on t h e s u b j e c t l e a s e agreement was properly brought under unlawful d e t a i n e r s t a t u t e s , precluding a p p l i - c a t i o n of t h e Landlord and Tenant A c t by v i r t u e of t h e exclusionary provision, s e c t i o n 70-24-104(8), M C A ? ~ e s o l u - t i o n of t h i s i s s u e determines t h e q u e s t i o n of whether t r e b l e damages w e r e an a p p r o p r i a t e award. S e c t i o n 70-24-104, MCA, sets f o r t h r e n t a l arrangements which a r e excluded from t h e province of t h e Landlord and Tenant A c t . P e r t i n e n t t o t h i s appeal, t h i s p r o v i s i o n s t a t e s : "Unless c r e a t e d t o avoid t h e a p p l i c a t i o n of t h i s c h a p t e r , t h e following arrangements a r e n o t governed by t h i s c h a p t e r : " ( 8 ) occupancy o u t s i d e a m u n i c i p a l i t y under a r e n t a l agreement which i n c l u d e s hunting, f i s h i n g , o r a g r i c u l t u r a l p r i v i l e g e s along w i t h t h e use of t h e dwelling u n i t . " S e c t i o n 70-24-104(8), MCA. I n c o n s t r u i n g t h i s s t a t u t e , w e a r e governed by t h e r u l e of c o n s t r u c t i o n t h a t ". . . a r e l a t i v e c l a u s e must be construed t o r e l a t e t o t h e n e a r e s t antecedent t h a t w i l l make sense. " S t a t e v. D i s t r i c t Court of t h e F i r s t J u d i c i a l D i s t r . (1936), 103 Mont. 487, 501, 63 P.2d 1 4 1 , 1 4 4 ; S t a t e v. Centennial Brewing Co. (1919), 55 Mont. 500, 513, 179 P. 296, 298. Therefore, t h e r e l a t i v e c l a u s e "which i n c l u d e s hunting, f i s h i n g , o r a g r i c u l t u r a l p r i v i l e g e s " n e c e s s a r i l y modifies t h e noun phrase " r e n t a l agreement", n o t t h e more remote noun "occupancy". Thus, b e f o r e a r e n t a l agreement can be ex- cluded from a p p l i c a t i o n of t h e Landlord and Tenant A c t by v i r t u e of s e c t i o n 70-24-104 ( 8 ) , MCA, hunting, f i s h i n g o r a g r i c u l t u r a l p r i v i l e g e s must be g r a n t e d by t h e t e r m s of t h e l e a s e agreement. The g r a n t i n g t e r m s of t h e r e n t a l agreement between ap- p e l l a n t and respondents s t a t e : "The S e l l e r h e r e i n may, a t h e r o p t i o n , r e n t from t h e Buyers t h e b u i l d i n g s conveyed by h e r t o t h e Buyers, t o g e t h e r w i t h approximately --- s i x ( 6 ) acres of l a n d . . ." (Emphasis added.) -- The d i f f i c u l t y i n t h e c a s e a t bar a r i s e s a s a r e s u l t of t h e noted language. The b u i l d i n g s mentioned a r e n o t d e l i n e a t e d anywhere i n the agreement. Without d e s c r i p t i o n of the buildings it i s impossible, without r e s o r t t o parol evidence, t o determine whether t h e l e a s e intends commercial, a g r i - c u l t u r a l o r s t r i c t l y r e s i d e n t i a l purposes. Couple t h i s with t h e g r a n t of s i x a c r e s of land and the p a r t i e s ' i n t e n t becomes even l e s s c l e a r . Thus, a c l o s e examination of t h e l e a s e r e v e a l s an ambiguity which n e c e s s i t a t e s parol evidence. Section 28-3-303, MCA, provides t h a t " [w] hen a c o n t r a c t i s reduced t o w r i t i n g , the i n t e n t i o n of the p a r t i e s i s t o be ascertained from t h e w r i t i n g alone - i f p o s s i b l e , s u b j e c t , however, t o the o t h e r provisions of t h i s chapter." (Emphasis added. ) A s discussed, a s c e r t a i n i n g t h e i n t e n t i o n s of the p a r t i e s t o t h i s a c t i o n i s not p o s s i b l e merely by examining t h e l e a s e . Section 28-3-402, MCA, s t a t e s " [ a ] c o n t r a c t may be explained by reference t o the circumstances under which it was made and t h e matter t o which it r e l a t e s . " This s t a t u t e i s i n accord with s e c t i o n 1-4-102, MCA, regarding t h e i n t e r p r e t a t i o n of instruments, which provides " [ £ ] o r the proper construction of an instrument, t h e circumstances under which it was made, including t h e s i t u a t i o n of the s u b j e c t of t h e instrument and of t h e p a r t i e s t o it, may a l s o be shown so t h a t t h e judge be placed i n t h e p o s i t i o n of those whose language he i s t o i n t e r p r e t . " Furthermore, s e c t i o n 28-2-905 (2) , MCA, s p e c i f i c a l l y permits consideration of e x t r i n s i c evidence regarding a w r i t t e n agreement t o ex- p l a i n an e x t r i n s i c ambiguity. Under t h i s s t a t u t o r y author- i t y , t h e D i s t r i c t Court properly accepted p a r o l evidence regarding t h e l e a s e agreement i n order t o explain t h e c i r - cumstances surrounding t h e agreement, thus resolving t h e ambiguity which e x i s t e d i n the instrument. The parol evidence presented a t t r i a l consisted of photographs and testimony from t h e p a r t i e s . The photographs e s t a b l i s h e d t h a t t h e buildings, which w e r e t h e s u b j e c t of t h e l e a s e , consisted of a small house, l a r g e barn and ex- t e n s i v e c o r r a l s , s e v e r a l storage and chicken sheds and garages. Respondent t e s t i f i e d t h a t during negotiation of t h e t e r m s , a p p e l l a n t s t a t e d t o him t h a t she needed the property t o maintain her animals u n t i l she could l o c a t e a l a r g e r farm. Appellant t e s t i f i e d t h a t p r i o r t o e n t e r i n g i n t o t h e l e a s e and continuing throughout her possession, she maintained horses on t h e property, p l u s s e v e r a l cows, goats and o t h e r domestic animals on an i n t e r m i t t a n t b a s i s . From t h i s evidence, t h e D i s t r i c t Court could determine t h e p a r t i e s ' i n t e n t i o n s i n l e a s i n g the property. Clearly, a p p e l l a n t needed t h e property i n order t o c a r e f o r and r a i s e t h e l i v e s t o c k which she owned. The only question remaining i s whether maintenance of l i v e s t o c k i n an operation of t h i s s c a l e i s a g r i c u l t u r a l within the meaning of t h a t t e r m i n s e c t i o n 70-24-104 ( 8 ) , M C A ? Appellant argues t h a t t h e term " a g r i c u l t u r a l " a s used i n s e c t i o n 70-24-104, MCA, encompasses only occupancies where farming o r ranching operations, whether primary o r secondary, a r e engaged i n f o r p r o f i t . Examination of s e c t i o n 70-24-104, MCA, d i s c l o s e s t h a t l e g i s l a t i v e i n t e n t f o r e c l o s e s such an i n t e r p r e t a t i o n . The term " a g r i c u l t u r a l " appears twice i n s e c t i o n 70-24-104, MCA. Under subsection ( 6 ) , "occupancy under a r e n t a l agreement covering premises used by the occupant primarily f o r commercial o r a g r i c u l t u r a l purposes" i s excluded from the Landlord and Tenant Act. Under subsection (8) , "occupancy o u t s i d e a municipality under a r e n t a l agreement which includes hunting, f i s h i n g , o r a g r i c u l t u r a l p r i v i l e g e s along with t h e use of the dwelling u n i t " i s excluded from t h e Act. Reading these s e c t i o n s together, it i s c l e a r the l e g i s - l a t u r e intended a comprehensive coverage of a l l a g r i c u l t u r a l operations, whether they a r e l a r g e s c a l e operations f o r p r o f i t , o r s m a l l s c a l e operations secondary t o the use of a residence. The term " a g r i c u l t u r e " has a very broad d e f i n i t i o n i n t h e law. Black's Law Dictionary, Revised Fourth Edition, d e f i n e s a g r i c u l t u r e as: "The a r t o r science of c u l t i v a t i n g the ground, including t h e harvesting of crops, and i n a broad sense, t h e science o r a r t of production of p l a n t s and animals u s e f u l t o man, including i n a v a r i a b l e degree, the preparation of these products f o r man's use . . ." Page 91. I n l i g h t of t h i s d e f i n i t i o n and the format of s e c t i o n 70-24- 1 0 4 , MCA, t h e D i s t r i c t Court properly determined t h a t a g r i - c u l t u r a l p r i v i l e g e s , within t h e meaning of s e c t i o n 70-24- 104 ( 8 ) , MCA, were granted by the l e a s e agreement. Such a f i n d i n g f o r e c l o s e s a p p l i c a t i o n of the Landlord and Tenant Act, and provisions of t h e unlawful d e t a i n e r s t a t u t e s govern. P l a i n t i f f s were e n t i t l e d t o t r e b l e damages f o r the t i m e defendant "held over" following termination of the tenancy. Each p a r t y s h a l l be responsible f o r h i s o r her own a t t o r n e y f e e s r e l a t i n g t o t h i s appeal. The judgment of t h e D i s t r i c t Court i s affirmed. W e concur: h Chief J u s t i c e