No. 80-313 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1981 

KATHERN We HUNSAKER RAGEN, 

Plaintiff, Cross-Defendant 

and Respondent, 

ARLO B. WESTON AND VERNETTA 

C. WESTON, Husband and wife, 

Defendant and Appellant. 

Appeal from: District Court of the First Judicial District, 

In and for the County of Broadwater, 

The Honorable Cardon Bennett, Judge presiding. 

Counsel of Record: 

For Appellant: 

Small, Hatch and Doubek, Helena, Montana 

For Respondent: 

IIooks & Budewitz, Townsend, Nontana 

Submitted on Briefs: January 22, 1981 

Decided: MAR 2 5 1981 
Mr. Justice Gene B. Daly delivered the Opinion of the Court. 

This appeal arises from a partial summary judgment 

entered against the defendants and in favor of the plaintiff 

by the District Court of the First Judicial District, in and 

for the County of Broadwater. 

Plaintiff, formerly Kathern Hunsaker, now Kathern 

Ragen, was the equitable owner of certain real property in 

Townsend, Montana, where she conducted a dry goods business. 

On July 20, 1978, Ragen entered into an agreement to sell 

the inventory of her business and to lease for $500 a month 

the real property to defendants, Arlo and Vernetta Weston. 

In the lease agreement, which expired on February 15, 1979, 

defendants were also granted an irrevocable option to 

purchase the building and fixtures for a sum of $75,000, 

less all rentals previously paid. The agreement further 

provided that, if the option was exercised, the Westons 

would pay to Ragen 29 percent of the total purchase price in 

the year of the sale and the balance would be paid over a 

period of ten years. 

The Westons, in an apparent effort to exercise the 

option, advised Ragen that they had forwarded a $17,000 

check to the State Bank of Townsend to be used as a portion 

of the downpayment. The parties then executed a contract 

for the sale of the real property, dated February 22, 1979, 

in accordance with the terms provided in the lease and 

option to purchase. The Westons paid their first 

installment of $500 under the contract on or about March 1, 

1979. However, when Ragen went to the State Bank of 

Townsend to pick up the $17,000 downpayment on March 9, 

1979, she was informed that the check would not be honored 
because there were insufficient funds in the account on 

which it was written. 

Failing to receive the agreed upon downpayment, Ragen 

notified defendants in writing on March 13, 1979, that the 

contract was deemed rescinded and that she was treating the 

$500 already paid as rent for the month of March. Plaintiff 

further demanded that defendants vacate the premises on or 

before March 31, 1979. 

On November 7, 1979, Ragen filed a complaint against 

the Westons seeking payment for real property taxes levied 

and assessed against the property for and during the term of 

the lease as provided in the lease agreement; payment for 

the reasonable value of certain fixtures sold by defendants 

during their occupancy of the premises; and payment for the 

reasonable value of a typewriter defendants refused to 

return upon vacating the property. The Westons denied any 

indebtedness to plaintiff and filed a counterclaim alleging 

that Ragen had wrongfully rescinded the agreement to 

purchase the property which resulted in damages in the 

amount of $25,000. In addition, the Westons alleged that 

during the term of the lease they placed approximately 

$6,000 worth of fixtures in the building and that by reason 

of the wrongful rescission and plaintiff's retention of 

these fixtures, they had been further damaged in that 

amount . 

Following discovery, plaintiff filed a motion for 

summary judgment on all liability issues. Defendants 

responded with their motion for summary judgment with 

respect to Ragen's claim for the real property taxes. The 

District Court, on May 22, 1980, granted Ragen's motion for 
summary judgment as to her claim for the real property 

taxes, with the exact amount of the taxes to be determined 

at trial or at an evidentiary hearing. The court further 

ordered that the motion for summary judgment on the issue of 

defendants' liability for the value of the typewriter and 

the fixtures be denied in that material issues of fact still 

remain. The court then granted summary judgment for 

plaintiff on both of defendants' claims for damages and 

ordered that the counterclaims be dismissed. Judgment was 

so entered on May 28, 1980, and defendants now appeal. 

The following issues are presented for our review: 

1. Did the District Court err in granting plaintiff 

summary judgment on the issue of defendants' liability for 

the payment of the real property taxes? 

2. Did the District Court err in rejecting 

defendants' counterclaims for damages resulting from a 

wrongful rescission of the purchase agreement and for 

damages resulting from a wrongful retention of certain 

fixtures? 

This Court has consistently held that the party 

moving for summary judgment has the burden of showing the 

absence of any genuine issue of material fact and that the 

movant is entitled to judgment as a matter of law. Reaves 

v. Reinbold (1980), Mont. , 615 P.2d 896, 37 

St.Rep. 1500; Harland v. Anderson (1976), 169 Mont. 447, 548 

P.2d 613; Kober v. Stewart (1966), 148 Mont. 117, 417 P.2d 

476. 

Here, the District Court could properly grant the 

summary judgment on the issue of defendants' liability for 

the property taxes only by finding that the lease and option 
to purchase agreement entered into by the parties required 

defendants to make the payments. The agreement is clear and 

specifically provides as follows: 

"By reason of concessions made by Hunsaker 

with respect to the option to purchase below 

set forth, Westons agree to pay the real 

property taxes levied and assessed against 

the premises during the term of their lease, 

and also agree to pay Hunsaker's fire 

insurance for the period of said lease. 

Hunsaker shall be entitled upon receipt of 

tax notice or insurance premiums or both, to 

make demand of Westons for payment of these 

items, and Westons agree to pay the same." 

Defendants maintain that the agreement to pay the 

real property taxes was conditioned upon their exercising 

the option to purchase and that, as a result of this 

assertion, a material issue of fact remains to be resolved. 

We must disagree. 

It is fundamental that the language of a contract 

will govern its interpretation if that language is clear and 

explicit and does not result in an absurdity. See section 

28-3-401, MCA; Danielson v. Danielson (1977), 172 Mont. 55, 

58, 560 P.2d 893, 894; Nelson v. Combined Insurance Company 

of America (1970), 155 Mont. 105, 113, 467 P.2d 707, 712. 

The pertinent language in this instance is unequivocal, 

unambiguous, and requires no interpretation. It 

specifically states that "Westons agree to pay the real 

property taxes levied and assessed against the premises 

during the term of their lease." Nowhere in the contract is 

there additional language indicating that this provision is 

qualified by a condition that the option to purchase first 

be exercised. 

The applicable provision must be given effect as 

written by the parties; thus, the District Court properly 
granted plaintiff summary judgment on the issue of 

liability. 

The second issue concerns defendants1 claim of 

wrongful termination. Section 28-2-1711, MCA, provides that 

a party may rescind a contract in the following cases: 

"(1) if the consent of the party rescinding 

or of any party jointly contracting with him 

was given by mistake or obtained through 

duress, menace, fraud or undue influence 

exercised by or with the connivance of the 

party as to whom he rescinds or of any other 

party to the contract jointly interested with 

such party; 

"(2) if, through the fault of the party as to 

whom he rescinds, the consideration for his 

obligation fails in whole or in part; 

"(3) if such consideration becomes entirely 

void from any cause;" 

In this instance, plaintiff, after being informed by 

defendants that the agreed downpayment on the option to 

purchase had been deposited at the State Bank of Townsend, 

executed the contract at issue. This contract provided that 

the $75,000 purchase price was to be paid as follows: 

"A. The sum of Three Thousand two hundred 

fifty Dollars ($3,250.00), the receipt of 

which is hereby acknowledged by seller, said 

sum representing the credit given to buyers 

for rentals heretofore paid under the lease 

and option of July 20, 1978. 

"B. The sum of Seventeen thousand Dollars 

($17,000) upon execution of this agreement, 

the receipt thereof being hereby acknowledged 

by seller. 

"C. The balance of Fifty-four thousand seven 

hundred fifty Dollars ($54,750.00), together 

with interest . . . to be paid in regular 

monthly installments, each in the amount of 

Five hundred Dollars ($500.00), the first 

monthly installment being due and payable on 

the 1st day of March, 1979." 

Upon reading the contract, it is obvious that the 

$17,000 check deposited in the State Bank of Townsend was an 
essential part of the consideration to be received by 

plaintiff and an inducement for executing the agreement. It 

is uncontroverted, however, that plaintiff never obtained 

this money because the check was dishonored due to the lack 

of sufficient funds. Since the consideration failed, the 

remedy of rescission was properly available. 

Section 28-2-1713, MCA, specifies how rescission is 

accomplished : 

"Rescission, when not affected by consent, 

can be accomplished only by the use on the 

part of the party rescinding of reasonable 

diligence to comply with the following rules: 

"(1) He must rescind promptly upon 

discovering the facts which entitle him to 

rescind if he is free from duress, menace, 

undue influence, or disability and is aware 

of his right to rescind. 

"(2) He must restore to the other party 

everything of value which he has received 

from him under the contract or must offer to 

restore the same, upon condition that such 

party shall do likewise, unless the latter is 

unable or positively refuses to do so." 

Here, rescission was prompt. Within three days of 

having the downpayment check dishonored, plaintiff delivered 

a written notice of rescission to defendants and their 

attorney setting forth the grounds for the action. 

Furthermore, the status quo existing prior to the contract 

to purchase was preserved in that the $500 installment paid 

by defendants was credited as rent for March 1979, allowing 

them to remain on the premises until the end of the month. 

Section 28-2-1713, MCA, must be deemed satisfied. 

Defendants argue that we should look solely to the 

default clause contained in the agreement to purchase in 

determining Ragen's proper remedy. In rejecting this 

argument, we note that this case does not involve a mere 
default in the payment of an installment but concerns the 

total failure of consideration essential for the validity of 

the contract. The consideration having failed, the remedy 

of rescission was available and, when exercised, the 

contract, including the default clause, was extinguished. 

See section 28-2-1701(2), MCA. 

Defendants further argue that the State Bank of 

Townsend erroneously refused to honor the $17,000 check; 

thus, it was the Bank's fault, not theirs, that this 

consideration failed. We acknowledge this contention but 

must conclude that any claim for damages based on this 

assertion lies against the Bank for wrongful dishonorment, 

not against plaintiff for wrongful termination of the 

contract at issue. 

We find no error in the District Court's dismissal of 

defendants' claims for damages based upon a wrongful 

rescission and termination of the contract. 

The Westons' final claim for damages arises from 

plaintiff's alleged wrongful retention of fixtures placed on 

the premises by defendants during their occupancy. The 

District Court dismissed this claim, finding it without 

basis. We agree with the court's conclusion. 

Defendants contend that plaintiff will be unjustly 

enriched if she is allowed to retain the fixtures. What 

defendants fail to realize, however, is that a fixture, by 

definition, is part of the real property to be retained by 

the owner of the premises at the expiration of the lease. 

See sections 70-15-101, 70-15-103, and 70-18-101, MCA. 

Defendants argue that even though the fixture is 

considered part of the realty, a tenant under certain 
circumstances is still entitled to its removal, citing 

section 70-18-102, MCA: 

"A tenant may remove from the demised 

premises, any time during the continuance of 

his term, anything affixed thereto for the 

purposes of trade, manufacture, ornament, or 

domestic use if the removal can be effected 

without injury to the premises unless the 

thing has, by the manner in which it is 

affixed, become an integral part of the 

premises." 

We agree that a tenant is generally accorded the 

right to remove certain trade fixtures; however, this right 

is not without limitation. As the above-cited statute 

indicates, the removal is to be accomplished during "the 

continuance of his term." 

Defendants have alleged no effort being made to 

remove the fixtures prior to vacating the premises; nor have 

they alleged that plaintiff interfered with such an effort. 

In fact, defendants waited until January 2, 1980 (some nine 

months after leaving the premises), to assert any claim. 

Furthermore, the claim finally asserted was for the 

reasonable value of the fixtures based upon an allegation of 

wrongful rescission and not for removal of the improvements 

as trade fixtures. On the submitted record, section 

70-18-102, MCA, has no application to this proceeding, and 

defendants' claim was properly rejected. 

The judgment of the District Court is affirmed. 

Justice 

J 
We concur: 

Chief L Justice ..-- 

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