No. 91-582 IN THE SUPREME COURT OF THE STATE OF MONTANA 1992

RAVALLI COUNTY 

### BANK, a Montana Banking Corporation, frq 

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## 1992; JAY M. GASVODA, a/k/a JAY M. GASVODA CONSTRUCTION,d/b/a



### . r (a ,, GASVODA CONSTRUCTION, SALLY A. L.'f 

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## kbA Ci.k:~i;:(IF s~~~~~,;- GASVODA, and ROLAND L. SAUTER, La,:C. ,- -0ilCij SiA'l'c:OFt~,ONrAK.R d/b/a BILLINGS TRUCK SALVAGE, Defendants and Appellants.

APPEAL FROM: District Court of the Fourth Judicial District, In and for the County of Ravalli, The Honorable Jack L. Green, Judge presiding.

COUNSEL OF RECORD: For Appellants: Lewis E. Brueggemann: Brueggemann Law Office, Billings, Montana. For Respondent: Thomas P. Koch; Koch, McKenna, Goheen & Weber, Hamilton, Montana.

Filed: Submitted on Briefs: March 26, 1992 Decided: June 4, 1992Justice John Conway Harrison delivered the Opinion of the Court.
This is an appeal from an order of the Fourth Judicial ~istrict Court,Missoula County,Montana, whichgranted respondent, Ravalli County Bank (the Bank), summary judgment against 

### the counterclaim of appellant, Roland L. Sauter (Sauter). We reverse and remand. The case at bar stems in part from two previous cases. In those cases Sauter filed suit in Justice Court against Jay M. Gasvoda (Gasvoda)

### , d/b/a 3.M.C. Ranch,for Gasvoda

### *snon-paymentof repairs Sauter made to Gasvodalstruck. Sauter prevailed in both suits and obtained 

### two judgments on May 26, 1985, totaling nearly $4,300. Subsequently, Sauter filed abstractsof judgments with the Ravalli County Clerk of Court against Gasvoda's real property. On April 17, 1985, approximately one month prior to Sauterls judgments against Gasvoda, the Bank, which previouslymade numerous loans to Gasvoda, obtained and recorded 

### an additional mortgage on Gasvodafsreal property in the amount of $14,872.31. Over five years later, 

### in a letter dated April 20, 1990,Mr. L. Neeley (Neeley), the Vice-president of the Bank, refused to restructure Gasvodalsmortgage due to existing exceptions, liens, and judgments on the property. The letter informed Gasvoda that foreclosureproceedings would commenceon 

### June 2, 1990,unless 

### the exceptions 

### were satisfied. In 

### May of 1990, Sauter's counsel received a letter from Gasvoda asking that Sauter's judgments be settled for $2,000to avoid foreclosure on June 1, 1990. OnApril 17, 1991,the Bank initiated foreclosure proceedings 2on Gasvoda's April 17, 1985 mortgage. Sauterwas also named as a defendant because of the judgment liens he held against Gasvoda. The complaint indicated thatunder themortgage, Sauter's judgment liens were subordinate and inferior to the rights of the Bank. Sauter filed his answer and counterclaim on May 31, 1991, based on alternative theoriesof fraud. Sauter alleged that either the Bank conspired to aid and assist Gasvoda in themortgage of his real property to the fraudulent detriment of Sauter, and\or the Bank was grossly negligent in not discovering Sauter's pending litigation against Gasvoda when it took an additional mortgage against Gasvoda's property on April 17, 1985. After Sauter responded to the Bank's request for admissions, all of which he denied, the Bank moved for summary judgment on Sauter's counterclaim. The motion for summary judgmentwas based

on Sauter's denials to the request for admissions, an affidavit of Neeley, and supporting memoranda. After a hearing on the summary judgment motion on October 16, 1991, the District Court found no genuine issues of material fact and granted the Bank's notion for summary judgment. Sauter now appeals the order of the District Court. The issue on appeal is whether the District Court erred in granting summary judgment against Sauter's counterclaim for fraud when it failed to specify grounds on which to base such a conclusion. Summary judgment is proper only when no genuine issues of material fact exist and themoving party is entitled to judgment asa matter of law. Rule 56(c), M.R.Civ.P.; also see Cereck 

### v. Albertson's Inc. (1981), 195 Mont. 409, 411, 637 P.2d 509, 510. The party moving for summary judgment has the initial burden of proof to show that 

### no genuine issues of material fact exist. Westmont Tractor Co. 

### v. Continental 

### I,Inc. (1986), 224Mont. 516, 521, 731 P.2d 327, 330. Once the moving party meets the burden, thenon-moving partymust establish thatgenuine issues of material fact exist. Simmons 

### v. Jenkins (1988), 230 Mont. 429, 432, 750

When granting summary judgment the trial court tfshall specify the grounds therefor with sufficient particularity as to apprise theparties and the appellate court of the rationale underlying the ruling and 

### this may be done 

### in the body of the order or in an attached opinion. Rule 52(a)

## ,M.R.Civ.P. 

### In Johnston 

### v, American Reliable Ins. Co, (1991)

### , 248 Mont. 227, 810 P.2d 1189, we encountered a situation similar to the case at barwith regard tothedistrict courtgranting summary judgment. In Johnston, we remanded with instructionsand stated: The DistrictCourt did not specify thegrounds for either of the summary judgment rulings with sufficient particularity to apprise the parties and the appellate court of the rationale underlying the rulings. We therefore remand this cause to the District Court with instructionsto specify the grounds for the rulingswith sufficientparticularity soas to apprise theparties and this Court of the rationale underlying its rulings. Johnston, 248 Mont. at 229-230, 810 P.2d 

### at 1191. In the case at bar we arrive 

### at the same conclusion. The District Court did not adhere to Rule 52(a)

### , M.R.Civ.P.

### , when it failed 

### to specify the grounds for the 

### summary judgment ruling withsufficient particularity. Therefore, we remand this case to the DistrictCourt withinstructions toproceed in accordance with this opinion. Reversed and remanded.

~e concur: 

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# 2aZ,, Chief Justice