Case Title: HARES v NELSON

Citation: 

Docket Number: 81-246

State: montana

Court: Montana Supreme Court

Date: 1981-11-25T00:00:00Z

Document:
No. 81-246 IN THE SUPREME COURT OF THE STATE OF MONTANA 1981 I . J. HARES and IRMA HARES, husband and wife, Plaintiffs and Respondents, RONALD W. NELSON, Defendant and Appellant. Appeal from: District Court of the Thirteenth Judicial District, In and for the County of Carbon Honorable William J. Speare, Judge presiding. Counsel of Record: For Appellant: Sally M . Johnson, Red Lodge, Montana For Respondents: Joseph E. Mudd, Bridger, Montana Submitted on briefs: July 30, 1981 Decided : M V 2 3 I$@ Filed: 2 5 1981 Mr. J u s t i c e Gene B. Daly d e l i v e r e d t h e Opinion of t h e C o u r t . Defendant-appellant, Ronald Nelson, a p p e a l s from a judgment e n t e r e d i n t h e T h i r t e e n t h J u d i c i a l D i s t r i c t Court of t h e S t a t e of Montana, Carbon County, t h e Honorable William Speare p r e s i d i n g . T h i s judgment t e r m i n a t e d a con- t r a c t f o r deed between t h e p l a i n t i f f s and t h e defendant due t o d e f e n d a n t ' s d e f a u l t ; g r a n t e d p o s s e s s i o n of t h e p r o p e r t y s u b j e c t of t h e c o n t r a c t t o t h e p l a i n t i f f s ; o r d e r e d t h e d e f e n d a n t t o s i g n a l l n e c e s s a r y documents t o convey h i s i n t e r e s t t o p l a i n t i f f s ; and awarded r e a s o n a b l e a t t o r n e y f e e s i n t h e amount of $872.50 p l u s c o s t s t o t h e p l a i n t i f f s . P l a i n t i f f s , I. J. and Irma Hares, e n t e r e d i n t o a c o n t r a c t f o r deed w i t h t h e d e f e n d a n t , Ronald Nelson, on December 29, 1978, whereby Nelson was t o purchase 365 a c r e s of l a n d p l u s some b u i l d i n g s . The p r o p e r t y , an o l d town s i t e , is l o c a t e d i n Carbon County, Montana. A f t e r t h e s a l e , t h e Hares r e n t e d t h e i r r e s i d e n c e on t h i s p r o p e r t y . Other r e n t e r s a l s o remained on t h e p r o p e r t y . The t o t a l purchase p r i c e was $92,750, t o g e t h e r with i n t e r e s t of 8 p e r c e n t p e r annum. Nelson was t o pay t h i s i n monthly i n s t a l l m e n t s of $ 1 , 0 0 0 , w i t h no downpayment, b e g i n n i n g A p r i l 1, 1 9 7 9 . Nelson made payments A p r i l through October 1979. No payment was made on November 1, 1979. The con- t r a c t r e q u i r e d w r i t t e n n o t i c e s t o be g i v e n and t o be s e r v e d upon t h e p a r t i e s p e r s o n a l l y o r by r e g i s t e r e d m a i l . The a d d r e s s i n t h e c o n t r a c t f o r Ronald Nelson was P. 0. Box 255323, Sacramento, C a l i f o r n i a 95825. The p l a i n t i f f s gave n o t i c e of d e f a u l t by m a i l and a l s o through t h e Carbon County s h e r i f f . Within t h e f i f t e e n days allowed by c o n t r a c t t o c u r e t h e d e f a u l t , Nelson made t h e $1,000 payment. However, he d i d n o t pay t h e a t t o r n e y f e e s r e q u e s t e d i n t h e n o t i c e and r e q u i r e d by t h e c o n t r a c t . No f u r t h e r payments were made on t h e c o n t r a c t . I n January 1980, E r i c Brabec, a grandson of t h e Hares, a t - tempted t o g i v e Nelson an accounting and a check f o r r e n t a l s c o l l e c t e d from t h e b u i l d i n g s on t h e p r o p e r t y . T h i s was r e j e c t e d by Nelson. A t t h e same t i m e , Brabec informed Nelson t h a t a d e f a u l t n o t i c e was w a i t i n g f o r him a t h i s p o s t o f f i c e box i n Red Lodge, Montana. A n o t i c e of d e f a u l t was a l s o s e n t t o t h e C a l i f o r n i a a d d r e s s a s r e q u i r e d by t h e c o n t r a c t . Neither n o t i c e was ever claimed. The Hares t h e n d e c l a r e d t h e f u l l o u t s t a n d i n g b a l a n c e on t h e c o n t r a c t due and payable on February 8 , 1980. A t no t i m e d i d Nelson o f f e r t o make f u l l payment on t h e c o n t r a c t ; he o f f e r e d o n l y t h e amount i n a r r e a r s . The n o t i c e f o r t h e balance was a l s o mailed b u t unclaimed. No payments were made t o c u r e t h e d e f a u l t . The Hares brought s u i t s e e k i n g t o compel Nelson t o e x e c u t e a l l neces- s a r y documents t o t e r m i n a t e h i s i n t e r e s t i n t h e c o n t r a c t f o r deed. Nelson answered and counterclaimed f o r an i n j u n c t i o n t o r e t a i n p o s s e s s i o n of t h e p r o p e r t y pending t h e outcome of t h e a c t i o n , a s w e l l a s f o r s p e c i f i c performance of t h e c o n t r a c t . Nelson contended t h a t an o r a l agreement had been reached by t h e p a r t i e s t o f o r e s t a l l payments on t h e c o n t r a c t u n t i l a proper accounting of t h e r e n t s r e c e i v a b l e from t h e Hares and c o l l e c t e d from o t h e r r e n t e r s by t h e Hares on behalf of Nelson was made. T r i a l on t h i s m a t t e r was h e l d J u n e 2 , 1980. The D i s t r i c t Court found t h a t no agreement e x i s t e d t o p r e v e n t f o r e c l o s u r e proceedings. The D i s t r i c t Court e n t e r e d f i n d - i n g s of f a c t and c o n c l u s i o n s of law on January 16, 1981. A judgment i n accordance w i t h such f i n d i n g s and c o n c l u s i o n s was e n t e r e d on February 3 , 1981. The issues presented on appeal are: 1. Did the trial court err in declaring a forfei- ture? 2. Did the trial court err in awarding attorney fees to the respondents? Appellant Nelson contends that this Court should apply section 28-1-104, MCAI to prevent a forfeiture. That section provides: "Relief from forfeiture. Whenever by the terms of an obligation a party thereto incurs a forfeiture or a loss in the nature of a forfeiture by reason of his failure to comply with its provisions, he may be relieved therefrom upon making full compensation to the other party, except in case of a grossly negligent, willful, or fraudulent breach of duty. I' Two important reasons exist for not applying section 28-1-104, MCA, in this instance. First, there is nothing in the record to indicate that appellant ever complied with section 28-1-104, MCA, by making full compensation to the respondents. Second, appellant made no claim to the District Court that section 28-1-104, MCA, was controlling. There- fore, since this section was not addressed by the trial court, this Court cannot review the application of the statute or the issue presented by it on appeal. See Rules 8(c) and 12(b), M.R.Civ.P. In Chadwick v. Giberson (1980), Mont. , 618 P.2d 1213, 1215, 37 St.Rep. 1723, 1726, we held: "However, it is also a well-settled rule of law that alleged error as to issues not raised in trial court will not be considered on appeal." See also, State v. Armstrong (1977), 172 Mont. 296, 562 P.2d 1129; Spencer v. Robertson (1968), 151 Mont. 507, 445 P.2d 48; Clark v. Worrall (1965), 146 Mont. 374, 406 P.2d 822. The trial court did not err when it declared a for- feiture and terminated the contract for deed. In Suburban Homes Co. v. North ( 1 9 1 4 ) , 50 Mont. 108, 117, 145 P. 2, 5, t h i s Court held: " I f payment is t o be made i n i n s t a l l m e n t s , d e f a u l t i n t h e payment of any i n s t a l l m e n t is a d i s t i n c t breach and g i v e s t h e vendor t h e r i g h t t o d e c l a r e a f o r f e i t u r e . The r i g h t must be promptly e x e r c i s e d , however; o t h e r - wise, t h e r i g h t being e x c l u s i v e l y t h a t of t h e p l a i n t i f f , he w i l l be presumed t o r e g a r d t h e c o n t r a c t a s s t i l l v a l i d and e x i s t e n t . " T h i s r u l e was r e a f f i r m e d i n Hansen v. Transamerica I n s . Co. ( 1 9 7 8 ) , 175 Mont. 273, 573 P.2d 663. T h i s Court i n Suburban Homes went on t o say: " I f t h e l a t t e r ( t h e vendee) c o n t i n u e s i n d e f a u l t , t h e vendor, by demand f o r payment of t h e balance of t h e purchase money and n o t i c e of h i s purpose t o t e r m i n a t e t h e c o n t r a c t i n c a s e of f u r t h e r d e f a u l t , may p u t t h e vendee upon h i s guard. I f a f t e r such n o t i c e he does n o t make payment w i t h i n a r e a s o n a b l e t i m e , t h e vendor may d e c l a r e t h e c o n t r a c t a t an end." 145 P. a t 5 . I n t h i s c a s e a p p e l l a n t d i d n o t make payments on t h e c o n t r a c t f o r two months. Notice was s e n t by r e g i s t e r e d m a i l t o h i s a d d r e s s a s p e r t h e terms of t h e c o n t r a c t and t o a Red Lodge, Montana, a d d r e s s . Respondents s t r i c t l y complied w i t h t h e d e f a u l t terms of t h e c o n t r a c t . The a p p e l l a n t d i d n o t . A p p e l l a n t contends t h a t t h e reason he d i d n o t pay any a t t e n t i o n t o t h e n o t i c e s of d e f a u l t was because he thought an o r a l c o n t r a c t f o r an o f f s e t had been e n t e r e d i n t o between himself and respondents. The a l l e g e d o r a l c o n t r a c t was t o modify t h e w r i t t e n c o n t r a c t by a l l o w i n g t h e a p p e l l a n t t o o f f s e t r e n t , owed t o him by r e s p o n d e n t s , a g a i n s t t h e monthly payments t h a t were due on t h e c o n t r a c t f o r deed. However, t h e t r i a l c o u r t found t h a t no such o r a l c o n t r a c t was e n t e r e d i n t o and t h a t a t b e s t t h e r e was merely an agreement t o d i s - c u s s some form of o f f s e t . F u r t h e r , under s e c t i o n 28-2-1602, MCA, which p r o v i d e s t h a t " [ a ] c o n t r a c t i n w r i t i n g may be a l t e r e d by a c o n t r a c t i n w r i t i n g o r by an executed o r a l agreement, and n o t o t h e r w i s e , " t h e r e could n o t have been a proper modification of the written contract. Finally, the only recourse available to the appellant after he had failed to respond to the notices of default and forfeiture would have been to tender full compensation to respondents. Sec- tion 28-1-104, MCA. Appellant at no time offered to tender full compensation; the best he offered was to tender the payments owed. The appellant argues that he did not receive effec- tive notice according to the terms of the contract. The contract states: "It is further mutually agreed between the parties hereto that any notice to be given hereunder shall be served upon the parties personally or by reqistered o ; certified mail directed to the party or parties to be served at their respective addresses as set forth, to wit "Buyer -- Ronald W. Nelson P. 0 . Box 255323 Sacramento, California 98525" (Emphasis added. ) Not only did respondents send notice to appellant at the California address, but they also sent notice to his Red Lodge, Montana, address. Further, Eric Brabec informed the appellant that a notice of default was at the post office in Red Lodge. Under the circumstances, the notice was suffi- cient, and the fact that notice of an earlier default was personally delivered does not mean that the mailed notices were in any way defective under the terms of the contract. Appellant's final contention is that the trial court erred in awarding attorney fees to respondents. The contract states: "In the event of default of the Buyer, Buyer agrees to reimburse the Seller, on demand, for all costs and expenses of whatsoever nature incurred by the Seller in enforcing any of the provisions of this agreement, including but not limited to, a reasonable attorney's fee for attorneys employed by the Seller in connection with the said default." I t is c l e a r t h a t t h e c o n t r a c t f a i r l y provided f o r an award of a t t o r n e y f e e s i n t h e e v e n t of a d e f a u l t . The t r i a l c o u r t j u s t l y awarded t h e f e e s i n accordance w i t h t h e t e r m s of t h e c o n t r a c t . The judgment of t h e D i s t r i c t Court is a f f i r m e d . / I J u s t i c e V We concur: