NO. 93-346 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1994 

BRINKMAN AND LENON, ARCHITECTS 

AND ENGINEERS, 

Plaintiff and Respondent, 

v. 

P & D LAND ENTERPRISES, a joint 

venture by NDI, Inc., and MINNESOTA 

TRUST COMPANY OF AUSTIN, a Minnesota 

Corp. , 

Defendants and Appellants. 

APPEAL FROM: District Court of the Eleventh Judicial District, 

In and for the County of Flathead, 

The Honorable Michael H. Keedy, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

A. Clifford Edwards, Kevin M. Funyak, Edwards Law 

Firm, Billings, Montana 

For Respondent: 

Debra D. Parker, Kendra L. Kawaguchi, Murphy, 

Robinson, Heckathorn & Phillips, Kalispell, Montana; 

Peter D. Plunkett, Warren F. Plunkett & Associates, 

Austin, Minnesota; David M. Ortley, Kalispell, 

Montana 

~ 

t g r4 .g 0 fubmitted on Briefs: December 22, 1993 

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FEB 01 1994 Decided: February 1, 1994 

Filed: 

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Justice Karla M. Gray delivered the Opinion of the Court. 

In this case, we conclude that the District Court erred in 

granting summary judgment to plaintiff Brinkman & Lenon because 

plaintiff failed to meet its initial burden of establishing the 

absence of genuine issues of material fact. Therefore, we reverse 

and remand. 

The facts necessary to our resolution of this case are 

straightforward. Brinkman and Lenon, Architects and Engineers 

(Brinkman), entered into a standard form architectural contract 

with P & D Land Enterprises (P&D) on May 21, 1990. Pursuant to the 

contract, Brinkman was to perform certain architectural and 

engineering services in connection with improvements to real estate 

owned by P&D and P&D was to pay for those services. Under § 4.10 

of the contract, P&D was required to give written notice of any 

deficiency in performance of the services. Section 8.6 required 

that, in the event of termination of the contract by P&D not 

resulting from any fault of Brinkman, payment was to be made for 

services performed prior to the termination date. 

Brinkman filed a breach of contract action against P&D in the 

Eleventh Judicial District Court, Flathead County. Brinkman 

asserted that it performed services under the contract, and that 

P&D terminated the contract and then failed to pay the amount owing 

to Brinkman at that time, in violation of 5 8.6 of the contract. In 

its answer, P&D admitted the existence of the contract and its 

termination, but denied any breach by it or that it owed Brinkman 

any money under the contract. P&D also counterclaimed, alleging 

2 
both breach of contract and negligent failure to provide proper 

services which resulted in delays, &necessary expense and lost 

revenue. 

Prior to discovery, Brinkman moved for summary judgment and 

presented the contract, a letter from P&D, an affidavit and certain 

invoices in support of its motion. P&D responded generally that 

issues of fact were raised by the pleadings and not met by Brinkman 

in its motion and supporting materials. The District Court granted 

Brinkman's motion for summary judgment via Memorandum and Order and 

judgment was entered. 

Pursuant to Rule 59(g), M.R.Civ.P., P&D moved the court to 

alter or amend its judgment, on the basis that Brinkman did not 

meet its initial burden of establishing the absence of genuine 

issues of material fact. In particular, P&D argued that its answer 

and counterclaim required Brinkman to establish entitlement to 

payment under the contract by, among other things, presenting 

evidence that P&D failed to give written notice of deficiencies in 

Brinkman's services as required by the contract. According to P&D, 

Brinkman offered only statements of counsel regarding the lack of 

written notice of deficiencies; no evidence of the lack of such 

required notice was provided via affidavit or otherwise. Thus, P&D 

contended, the question of whether such notice was given was a 

genuine issue of material fact raised by its answer and 

counterclaim and not met by Brinkman. P&D also presented 

correspondence to Brinkman, which it characterized as written 

notice of deficiencies in performance. 
Brinkman responded that P&D had the burden of establishing 

that it had given the required notice of deficiency in response to 

the motion for summary judgment. Having failed to do so, Brinkman 

argued, P&Dts presentation of the correspondence purporting to 

establish that it had given the required notice was untimely. 

According to Brinkman, P&D was required to raise this "substantive 

defense" in opposition to the motion for summary judgment. Relying 

on Scott v. Robson (1979), 182 Mont. 528, 597 P.2d 1150, the 

District Court denied the motion to alter or amend on the basis 

that the letter was not timely offered in opposition to the motion 

for summary judgment and could not be considered thereafter. P&D 

appeals from the summary judgment which became final upon the 

court's denial of its motion to alter or amend. 

Did the District Court apply the correct standard to 

Brinkman's motion for summary judgment? 

Our standard of review in appeals from summary judgment is & 

m; we review a summary judgment utilizing the same criteria used 

by the District Court initially under Rule 56, M.R.Civ.P. Minnie 

v. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214. 

We determine whether there is an absence of genuine issues of 

material fact and whether the moving party is entitled to judgment 

as a matter of law. Minnie, 849 P.2d at 214. In this case, we 

conclude that summary judgment was improper because the record is 

devoid of the required showing of proof demonstrating an absence of 

genuine issues of material fact and an entitlement to judgment as 

a matter of law. Specifically, we focus on the District Court's 

determination that P&D did not notify Brinkman of any deficiency in 

4 
performance. 

It is clear that a party moving for summary judgment bears the 

initial burden of establishing the absence of any genuine issue of 

material fact and its entitlement to judgment as a matter of law. 

Rule 56(c), M.R.Civ.P. Furthermore, 

[wlhen a motion for summary judgment is made 

supported as provided in this rule, an adverse party may 

not rest upon the mere allegations or denials of [its] 

pleading, butthe adverse party's response, by affidavits 

or as otherwise provided in this rule, must set forth 

specific facts showing that there is a genuine issue for 

trial. 

Rule 56(e), M.R.Civ.P. (Emphasis added.) Put another way, the 

nonmoving party has no obligation to establish that genuine issues 

of fact exist until the moving party has shown an absence of such 

issues of fact; unless that initial burden is met by the moving 

party, the nonmoving party may rest on its pleading. Minnie, 849 

P.2d at 214. 

In Mathews v. Glacier General Assurance Co. (1979), 184 Mont. 

368, 603 P.2d 232, the plaintiff alleged entitlement to the policy 

limits under a contract for insurance as a result of fire damage. 

The defendant insurer generally denied the entitlement and asserted 

the affirmative defense of material alteration of the premises. 

The plaintiff moved for summary judgment, but did not present 

evidence from which it could be concluded that a material 

alteration had not taken place as was alleged in the defendant's 

affirmative defense. The district court granted the motion. We 

noted that the matters considered were devoid of any evidence 

initially presented by the plaintiff to justify a conclusion that 
a material question of fact did not exist regarding the affirmative 

defense of material alteration; absent this showing, the defendant 

had no duty to come forward with counterproof. Mathews, 603 P.2d 

at 235, 237. We reversed the district court, stating: 

The order granting summary judgment was based on a determination that although plaintiff was the moving party, 

defendant had the initial burden to show by affidavits or 

other evidence, that a material question of fact existed 

in relation to its affirmative defense of material 

alteration. Because defendant did not do so, the court 

granted summary judgment to plaintiff. It was error to 

impose this initial burden on defendant, the nonmoving 

party. . . . 

Mathews, 603 P.2d at 236. 

As was the case in Mathews, the pleadings in this case framed 

the issues. Brinkman alleged that he was entitled to payment under 

the contract; P&D alleged that Brinkman had performed deficiently. 

Given that the contract required P&D to give notice of such 

deficiencies before terminating the contract, the issue of whether 

notice was given was crucial to each party's claim. Further, 

Brinkman does not dispute on appeal, and did not dispute at the 

District Court, that P&D1s answer and counterclaim raised the 

material factual issue of whether notice of deficiency had been 

given. Thus, with its motion for summary judgment, Brinkman bore 

the initial burden of establishing the absence of genuine issues of 

material fact, including the material issue of notice of deficiency 

in performance. Accordingly, we review the materials submitted in 

support of Brinkman's motion. 

Brinkman presented the contract containing the provisions 

referred to in this opinion. Brinkman also presented a letter from 
P&D referencing the contractual "terminate and payf1 provision. 

Nothing in that letter related to notices of deficiency required by 

the contract. Finally, Brinkman submitted the affidavit of Tom 

Heinecke (Heinecke), a Brinkman stockholder, and copies of certain 

invoices. Heinecke stated that he was familiar with the services 

performed and invoices corresponding to those services and that 

Brinkman had not been paid for services performed in the amount of 

$4,751.98 as of the date of the termination of the contract. 

Heinecke's affidavit did not refer to the contract provision 

regarding deficiency notices or assert that no such notice had been 

given by P&D. 

Brinkman's brief in support of its motion made numerous 

references to P&Dfs contractual obligation to provide written 

notice of any alleged deficiency in performance. Brinkman's 

counsel stated that "P&D never gave Plaintiff written notification 

of an alleged deficiency in Plaintiff's work;" she further stated 

that "P&D failed to fulfill its obligation to notify Plaintiff of 

such defective performance, as required under Section 4.10 of the 

contract;" and again, she stated at some length: 

Because P&D never gave Plaintiff written notification of 

defective performance it cannot claim that its nonpayment for services performed is justified. P&Dts 

failure to provide Plaintiff with the prompt written 

notification required under the terms of the contract 

precludes P&D from objecting to its obligation to pay 

Plaintiff for services performed. 

The obvious problem with these statements is just that: they 

are merely statements of counsel. Such statements of counsel do 

not meet the evidentiary basis required to support a motion for 
summary judgment under Rule 56(c), M.R.Civ.P. Traders State Bank 

of Poplar v. Mann Farms, Inc. (1992), 258 Mont. 226, 242, 852 P.2d 

604, 614. As a result, counselts statements cannot meet Brinkmants 

duty to establish the absence of a genuine issue of material fact 

regarding a contractually required notice of deficiency. 

We conclude that Brinkman did not meet its initial burden with 

regard to the issue of notice of deficiency; as a result, the 

burden did not shift to P&D to come forward with evidence 

establishing the existence of that fact. It is clear from the 

District Court's memorandum that the court placed the burden on P&D 

to present affirmative evidence that, in fact, notice was given. 

P&D having failed to do so, the court determined that "[tlhere is 

no issue of fact that P&D did not notify Plaintiff of defective 

performance" and that Brinkman was entitled to judgment as a matter 

of law. This conclusion was in error. 

Absent a showing that no genuine issues of material fact 

existed, Brinkman was not entitled to judgment as a matter of law 

on its breach of contract claim. We hold that the District Court 

erred in applying an incorrect standard to Brinkman's motion for 

summary judgment and in making a determination of the disputed and 

material factual issue of whether a notice of deficiency was given 

without evidence of record to support that determination. It 

follows logically, therefore, that the District Court compounded 

its error by denying P&D1s motion to alter or amend. 

In conclusion, we observe here as we did in Mathews that, 

although P&D was technically correct in relying solely on its 
pleading because Brinkman did not meet its initial burden, "that is 

not to say that we recommend this procedure." Mathews, 603 P.2d at 

240. Here, as in Mathews, P&D may have been able to prevent an 

appeal on the summary judgment question if it had placed affidavits 

or other evidence in the record demonstrating that a genuine issue 

of material fact existed as to the contractually required notice of 

deficiency. 

Reversed and remanded for further proceedings. 

n .