Title: KAMP IMP CO v AMSTERDAM LUMBER C

State: montana

Issuer: Montana Supreme Court

Document:

No. 12811 I N THE S U 1 W 2 M E COURT O F THE STATE O F M O N T A N A 19 7 5 lUMP IMPLEMENT COMPANY, a corporation, T H O M A S J. KAMP and F E N N A H. KAMP, P l a i n t i f f s and Appellants, -vs - A M S T E R D A M LUMBER, INC . , Defendant and Respondent. Appeal from: D i s t r i c t Court of t h e Eighteenth J u d i c i a l D i s t r i c t , Honorable Edward Dussault, Judge presiding. ,2ounsel of Record : For Appellants : Bennett and Bennett, Bozeman, Montana Lyman H. Bennett Jr. argued and Lyman Bennett, I11 argued, Bozeman, Montana For Respondent: Drysdale, Mc lean and Scully, Bozeman, Montana James A. M c k ,lean argued, Bozeman, Montana submitted: March 5, 1975 Decided : W P R '1 0 1975 Filed : &ypR u (jib B r . JusLice Idesley " a s ~ l e s d e l i v e r e d the 3pinion of t h e Court. This appeal is from an o r d e r e n t e r e d by t h e Hon. Edward l ' . 3 u s s a u l t , s i t t i n g i n t h e d i s t r i c t c o u r t , G a l l a t i n County, confirming a judgment e n t e r e d by Hon. Jack D . Shanstrom, d a t e d July 25, 1973, i n f a v o r o f defendant Amsterdam Lumber, I n c . , and a g a i n s t p l a i n t i f f s Kamp Implement Company, a c o r p o r a t i o n , Thomas J . Kamp and Fenna H. Kamp ( h e r e i n a f t e r c o l l e c t i v e l y r e f e r r e d t o a s Yarnp). I n t h e a l t e r n a t i v e of confirming t h a t judgment, appel- l a n t s r e q u e s t a new t r i a l . The m a t e r i a l sequence of e v e n t s l e a d i n g t o t h e i n s t a n t as cioii was: October 29, 1971: Amsterdam Lumber f i l e d a complaint i n GalLatin County d i s t r i c t c o u r t , cause number 19818. B a s i c a l l y t h e complaint prayed f o r f o r e c l o s u r e of a mechanics' l i e n and f o r t h e balance of moneys owned on a steel b u i l d i n g s o l d t o Kamp by Amsterdam Lumber. October 30, 1971: Thomas J. Kamp and Kamp Implement Com- pdny w e r e served w i t h summons and complaint. November 2, 1971: Fenna H . Kamp was served w i t h summons and zomplaint. February 28, 1972: A f t e r evidence was presented t o t h e court, Hon. W. W. Lessley e n t e r e d a d e f a u l t judgment a g a i n s t Kamp and f u r t h e r provided f o r f o r e c l o s u r e by s a l e o f t h e p r o p e r t y upon hnich t h e l i e n was f i l e d . N o appearance was e v e r e n t e r e d by Kamp. March 8 , 1972: Kamp f i l e d a motion t o set a s i d e t h e d e i a u l t . March 2 2 , 1972: A f t e r a h e a r i n g on t h e motion, Judge !,essley i s s u e d an o r d e r denying t h e motion t o s e t a s i d e t h e d e f a u l t . March 31, 1972: Kamp i n s t i t u t e d t h e i n s t a n t a c t i o n , G a l l a t i n County cause number 20055, s e e k i n g t o set a s i d e t h e d e f a u l t judgment i n cause number 19818 on t h e b a s i s t h a t f r a u d had been committed i n t h a t Amsterdam Lumber f a i l e d t o a d v i s e t h e c o u r t : a ) That t h e property upon which t h e l i e n was f i l e d was n o t t h e property upon which t h e b u i l d i n g was c o n s t r u c t e d ; b) of c e r t a i n business t r a n s a c t i o n s between t h e p a r t i e s ; c ) t h a t t h e b u i l d i n g was d e f e c t i v e ; and d ) of t h e d i s a b i l i t y of Thomas J. Kamp because of a h e a r t condition. Events p e r t i n e n t t o t h i s appeal occurring a f t e r t h e f i l i n g of t h e complaint i n G a l l a t i n County cause number 20055 and through t h e t i m e of t h i s C o u r t ' s opinion i n t h e c a s e , S t a t e ex rel. Amsterdam Lumber, I n c . v. D i s t r i c t Court, 163 Mont. 182, 516 P.2d 378, 379-381, 383, 30 St.Rep. 1018, a r e r e c i t e d t h e r e i n . These e v e n t s , m a t e r i a l t o our c o n s i d e r a t i o n , occurred subsequent t o t h e C o u r t ' s opinion: A p r i l 25, 1974: Hon. Edward T. Dussault assumed j u r i s - d i c t i o n . June 1 4 , 1974: A hearing was held before Judge Dussault. June 2 4 , 1974: Judge Dussault e n t e r e d f i n d i n g s of f a c t and conclusions of law, concluding " t h a t by reason of t h e p r e s e n t s i t u a t i o n of t h e proceedings i n t h i s c a s e , t h i s Court should make and e n t e r a n appealable Order". H e then ordered Judge B l a i r ' s o r d e r , dated September 2 1 , 1973, set a s i d e as void; confirmed t h e f i n d i n g s of f a c t and conclusions of law of Judge Shanstrom d a t e d J u l y 11, 1973; confirmed t h e judgment of Judge Shanstrom dated J u l y 25, 1973; and, i n t h e a l t e r n a t i v e , ordered a new t r i a l . Kamp on appeal p r e s e n t s f i v e i s s u e s : (1) Did Judge Dussault have j u r i s d i c t i o n t o make t h e o r d e r dated June 2 4 , 1974? ( 2 ) Is t h e judgment entered by Judge B l a i r on October 1, 1973, a v a l i d judgment? ( 3 ) Is t h i s c a s e moot on t h e b a s i s of t h e p r o v i s i o n s of s e c t i o n 58-423, R.C.M. 1947? ( 4 ) Did Judge Shanstrom err i n e n t e r i n g h i s o r d e r nunc pro t u n c , d a t e d J u l y 11, 1973? ( 5 ) Is t h e r e sub s t a n t i a l evidence t o support a judgment i n favor of Kamp? Mamp's i s s u e s 2 and 3 were determined i n t h i s C o u r t ' s o p i n i o n i n S t a t e ex r e l . Amsterdam Lumber, I n c . v. District Court, 163 Mont. 182, 516 P.2d 378, 381, 30 St.Rep. 1018, i n t h i s manner: "The second i s s u e i s whether t h e i s s u e s p e t i t i o n e r r a i s e s i n t h i s Court a r e moot. Mootness h e r e i s bottomed on t h e v a l i d i t y of t h e judgment e n t e r e d by Judge B l a i r . For reasons t h a t w i l l appear i n o u r d i s c u s s i o n of t h e f i n a l i s s u e , t h a t judgment is void and of no f o r c e and e f f e c t . Hence it could n o t be s a t i s f i e d by d e p o s i t and n o t i c e and t h e i s s u e s p u r p o r t e d l y concluded t h e r e b y remain f o r a d j u d i c a t i o n . " The law w i t h r e s p e c t t o i s s u e s 2 and 3 was w e l l s t a t e d by t h i s Court i n Anderson v . Border, 87 Mont. 4 , 8 , 285 P . 174: "The g r e a ter p o r t i o n o f a p p e l l a n t I s e x h a u s t i v e b r i e f i s devoted t o a n a t t e m p t t o demonstrate t h a t our former o p i n i o n i n t h i s c a s e i s erroneous, but t h e s h o r t answer i s t h a t a s t o a l l p o i n t s which were d i r e c t l y involved i n , and were passed upon, i n t h e former a p p e a l , and which a r e involved i n t h i s c a s e , whether t h e o p i n i o n i s r i g h t o r wrong, it i s t h e law of t h e c a s e , was binding upon t h e t r i a l c o u r t , and i s binding upon u s . " See: L i b i n v . Huffine, 124 Mont. 361, 364, 224 P.2d 1 4 4 ; C e n t r a l Montana Stockyards v.. F r a s e r , 133 Mont. 168, 187, 320 P.2d 981; Gaffney v . I n d u s t r i a l Accident Board, 133 Mont. 448, 450, 324 P.2d 1063. While Kamp was n o t a named p a r t y i n our S t a t e ex rel.Amsterdam Lumber d e c i s i o n , it was, however, c e r t a i n l y one of t h e r e a l p a r t i e s i n i n t e r e s t . The a t t o r n e y s r e p r e s e n t i n g Kamp i n t h e d i s t r i c t c o u r t w e r e t h e same a t t o r n e y s r e p r e s e n t i n g Judge B l a i r i n t h i s Court. A s such Kemp s h a l l be held t o t h e same standard a s i f it had been a named p a r t y . I f Kamp f e l t aggrieved over t h i s C o u r t ' s d e c i s i o n , t h e proper remedy should have been t o move f o r a r e h e a r i n g i n t h i s Court, allowing t h i s Court t o promptly c o r r e c t i t s e r r o r , n o t - t o have sat i d l y by and allowed Amsterdam Lumber and t h z d i s t r i c t c o u r t t o r e l y on the error. We turn now to Kamp's issue 1: Did Judge Dussault have jurisdiction to make his order dated June 24, 1974? We hold that he did. Kamp's argument, in summary, is: When this Court remanded this controversy to the district court on November 27, 1973, the only item before the district court was Amsterdam Lumber's motion filed October 11, 1973. Judge Dussault assumed jurisdiction in this case on April 25, 1974. No further action was taken until some fifty days later, on June 14, 1974, when Judge Dussault held a hearing on Amsterdam Lumber's motion. This time lapse of fifty days failed to comply with the time limits of Rule 59, M.R.Civ.P. Therefore, Kamp alleges, Judge Dussault lost jurisdiction to make his order dated June 24, 1974. While Kamp proposes an interesting argument, it is based upon the assumption that Judge Blair's judgment was valid, an assumption we have already considered and found wanting. Be- cause Judge Blair's judgment was void, there was no final judg- ment to appeal from, on which to base a motion to vacate or alter a judgment, nor from which Rule 59, M.R.Civ.P., time limits could be computed. There remained the necessity for a judge with juris- diction to enter an appealable order, as was recognized by Judge Dussault in his findings of fact, conclusions of law and order entered June 24, 1974. Judge Dussault was complying with the directions of this Court in State ex rel. Amsterdam Lumber, Inc., supra. We affirm Judge Dussault's order which confirmed Judge Shanstrom's judgment and substituted findings of fact and con- clusions of law. We hold, as did Judge Shanstrom, that the denial of Kamp's motion to set aside the default in cause number 19818, and Kamp's failure to appeal therefrom, constitutes a bar to the present action under the doctrine of res judicata. I n reply t o Fnsterdam Lumber's defense of r e s judicata, Kamp relies on t h e decision i n Selway v. Burns, E s t a t e of Burles, 150 Mont. 1, 8, 429 P.2d 640, wherein t h e Court s t a t e d : " * * * it has long been t h e r u l e i n Montana t h a t a c o u r t of equity has inherent power, independent of s t a t u t e , t o grant r e l i e f from judgments gained by fraud * * * t h e r e l i e f may be granted e i t h e r on motion i n t h e o r i g i n a l a c t i o n o r i n a separate equity s u i t . Rule 60(b) expressly preserved t h i s inherent power i n i t s l a s t sentence which provides: 'This r u l e does not l i m i t t h e power of a c o u r t t o e n t e r t a i n an independent a c t i o n t o r e l i e v e a p a r t y from a judgment, order, o r proceeding * * *Ill- While Selway s t a t e s t h e r u l e t h a t a l i t i g a n t may obtain r e l i e f from a judgment obtained by fraud e i t h e r by a motion under Rule 6 0 ( b ) , M.R.Civ.P., o r - by an independent a c t i o n , it does not s t a t e t h a t a l i t i g a n t may pursue both remedies. The law of r e s judicata remains unchanged from t h a t s t a t e d years ago i n Meyer v. Lemley, 86 Mont. 83, 95, 282 P. 268: "In t h e case a t bar t h e s t a t u t o r y remedy was p l a i n , speedy and adequate. Under it appellant could have obtained complete r e l i e f . It could have had t h e decree, and a l l subsequent proceed- i n g s thereunder, set a s i d e * * *. Appellant invoked t h e a i d of t h e s t a t u t e , but through i t s own f a u l t f a i l e d t o pursue properly t h e remedy it afforded * * * " ' I f t h e complaining party has r e s o r t e d t o an adequate l e g a l remedy, and been denied r e l i e f , t h i s adjudication should bar any r e l i e f i n equity on grounds then a v a i l a b l e which were o r might have been t h e r e urged.' The form of t h e l e g a l remedy i s immaterial, i f it be adequate. (3 Freeman on Judgments, 5th ed. sec. 1 1 9 4 . ) * * * " * * * Appellant had an adequate remedy, invoked it, l o s t it through i t s own f a u l t . He who summons t h e public force t o a i d him i n t h e a s s e r t i o n of h i s r i g h t s must follow t h e r u l e s prescribed. He cannot be permitted, a f t e r having s e l e c t e d an appropriate and adequate remedy and having f a i l e d through h i s own f a u l t t o o b t a i n r e l i e f thereby, t o then harass h i s blameless adversary by pursuing another and d i f f e r e n t remedy. It i s t o t h e i n t e r e s t of society t h a t l i t i g a t i o n end; ' i n t e r e s t reipublicae u t s i t f i n i s litium. ' " When Kamp f i l e d i t s motion t o s e t a s i d e t h e d e f a u l t i n cause number 19818, pursuant t o Rules 55(c) and 6 0 ( b ) , M.R.Civ.P., it had an adequate remedy. Rule 60(b) (3) permits a l i t i g a n t t o move f o r r e l i e f , and t h e c o u r t t o g r a n t such r e l i e f , on t h e grounds of fraud. I n h i s sworn a f f i d a v i t i n support of t h e motion t o set a s i d e t h e d e f a u l t Thomas J. Kamp enumerated t h e i d e n t i c a l f a c t s forming t h e b a s i s of t h e i n s t a n t fraud a c t i o n and alleged t h e f a i l u r e of Amsterdam Lumber t o inform t h e c o u r t of t h i s c o n s t i t u t e d alleged fraud. I n f a c t , Kamp e x p l i c i t l y admitted i n one of its t r i a l b r i e f s t h a t fraud w a s one of t h e grounds advanced i n support of its motion t o s e t a s i d e t h e d e f a u l t i n cause number 19818. Kamp had its day i n c o u r t i n cause number 19818 and a s t o t h e i s s u e of whether the d e f a u l t judgment should be set a s i d e , t h e pleadings on f i l e i n t h e i n s t a n t case and answers t o i n t e r - r o g a t o r i e s show t h a t t h e i n s t a n t a c t i o n is merely a rehash of Kamp's former motion t o set a s i d e t h e d e f a u l t judgment i n cause number even though it attempts t o t u r n t h e case i n t o an independent a c t i o n based upon t h e theory of Selway. Kamp f u r t h e r contends t h a t d e s p i t e a l l t h e foregoing, it should not be barred by t h e d o c t r i n e of r e s judicata s i n c e Judge Lessley excluded much of t h e evidence which Kamp sought t o o f f e r a t t h e hearing on t h e motion t o s e t a s i d e t h e d e f a u l t judgment. It a l l e g e s t h e r e s u l t was t h a t it was unable t o present fraud a s an i s s u e . Under Rule 60 (b) (3) , M.R.Civ.P., fraud i s a proper i s s u e t o present on a motion t o s e t a s i d e a d e f a u l t judgment. I f Kamp f e l t i t s evidence was erroneously r e j e c t e d by Judge Lessley, i t s remedy a t t h a t time was t o appeal Judge Lessley's order denying i t s motion; not t o have f u r t h e r harassed Amsterdam Lumber by i n s t i t u t i n g a new and separate a c t i o n . Libin v. Huffine, 124 Mont. 361, 224 P.2d 1 4 4 . Kamp f a i l e d t o properly pursue t h e remedy o r i g i n a l l y chosen, t h e r e f o r e it i s barred from choosing and pursuing a new and s e p a r a t e remedy by t h e d o c t r i n e of res j u d i c a t a . I n its i s s u e 4 , Kamp, i n support of i t s contention t h a t Judge Shanstrom e r r e d i n e n t e r i n g h i s order nunc pro tunc, relies on t h e d e c i s i o n s i n S t a t e ex rel. Kruletz v. District Court, 110 Mont. 36, 98 P.2d 883; and S t a t e ex rel. Craig v. District Court, 153 Mont. 427, 458 P.2d 608, f o r t h e p r o p o s i t i o n t h a t t h e d i s t r i c t c o u r t has t h e power t o c o r r e c t a c l e r i c a l e r r o r , but not a j u d i c i a l e r r o r , by e n t r y of a nunc pro tunc o r d e r . Kamp contends t h a t when Judge Shanstrom executed Kampls f i n d i n g s of f a c t and conclusions of law, he found i n favor of Kamp and could n o t t h e r e a f t e r change t h a t judgment by e n t r y of h i s order nunc pro tunc. W e need n o t decide whether a c l e r i c a l e r r o r o r a j u d i c i a l e r r o r was made, f o r whichever was committed t h e r e s u l t is t h e same: t h i s a c t i o n w i l l be judged on t h e m e r i t s . I f a clerical e r r o r was committed, we would a f f i r m Judge D u s s a u l t l s o r d e r con- firming Judge Shanstrom's judgment f o r Amsterdam Lumber based upon t h e grounds of res judicata. I f a j u d i c i a l e r r o r was made, with t h e r e s u l t t h a t judgment should have been entered f o r Kamp based upon t h e o r i g i n a l f i n d i n g s of f a c t and conclusions of law f i l e d June 29, 1973, we would have t o r e v e r s e t h a t judgment, again on t h e grounds of res j u d i c a t a . E i t h e r way, Amsterdam Lumber p r e v a i l s . Kampls i s s u e 5, whether t h e r e is s u b s t a n t i a l evidence t o support a judgment i n favor of Kamp, has become immaterial. R e s j u d i c a t a is a question of law, not of f a c t . Judgment f o r respondent Amsterdam Lumber, Inc. i s affirmed. * , * --------.--------------------- J u s t i c e