No. 12974 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1975 

WILLIAM G. MITCHELL, 

Plaintiff and Appellant, 

-vs - 

HAROLD F. MITCHELL, 

Defendant and Respondent. 

Appeal from: District Court of the Third Judicial District, 

Honorable John Be McClernan, Judge presiding. 

Counsel of Record: 

For Appellant: 

William R. Taylor argued, Deer Lodge, Montana 

Radonich and Reardon, Anaconda, Montana 

John N. Radonich appeared, Anaconda, Montana 

For Respondent: 

Knight, Dahood and Mackay, Anaconda, Montana 

C. F, Mackay argued, Anaconda, Montana 

Submitted: November 6, 1975 

Decided : J&& 1.6 qftYR ,3!h 
Mr. Justice Gene B. Daly delivered the Opinion of the Court. 

This is an appeal from a judgment in an accounting 

action from the district ccurt, Deer Lodge County, sitting without 

a jury. 

Plaintiff William G. Mitchell is the son of defendant 

Harold F. Mitchell. In August 1970, the son filed a complaint 

alleging the existence of an oral partnership between himself and 

his father, and seeking to obtain a full accounting of partnership 

funds and assets. The complaint stated: (1) that the purpose of 

the partnership was to acquire certain described real property, 

commonly known as Yanlcee Flats, west of Anaconda, Montana, and 

that both the son and the father had advanced monies to apply on 

the contract for purchase; (2) that the father now claims an 

exclusive right in and to the real property and denies the son 

has any right to the use, or ownership in the properties; and 

(3) that a demand for an accounting of the monies advanced by 

the son for the purchase of the real property has been denied by 

the father. 

Answer and demand for a jury trial was filed by the 

father in September 1971, more than a year after the filing of the 

complaint. In that answer the father denied the existence of an 

oral partnership agreement; denied the son had advanced money on 

a contract for deed to purchase the real property; and denied the 

son had any right to the use, or ownership in the real property. 

The answer stated that the reason no accounting was ever given was 

I I that there has never been a partnership and therefore this 

answering defendant was not under any obligation to the plaintiff." 

In April 1973, Judge Robert J. Boyd of the third judicial 

district was disqualified and Judge John B. McClernan, of the 

second judicial district, assumed jurisdiction. 
On July 23, 1973, a trial without jury was held in Deer 

Lodge County. Immediately before trial and a period of one 

year and ten months after the original answer, the defense 

counsel handed counsel for the plaintiff an amended answer and 

demand for a jury trial. Plaintiff's counsel objected to the 

offer of the amended answer on the grounds that it was untimely, 

prejudicial and would cause a delay in the trial. The delay in 

the trial was objected to because this was the second trip 

plaintiff had made from St. Louis, Missouri, at considerable expense. 

The court overruled the objection and granted leave to 

file the amended answer. The demand for a jury trial was denied. 

This exchange then took place between counsel for plaintiff and 

the court: 

"14JX. TAYLOR: Your Honor, in view of the Court ' s 

ruling, may we recess to read the answer? 

"THE COURT: You may sit down and read the answer 

Mr. Taylor, 11 

Mr. Taylor then renewed his objection and added: 

11~; J; * the Defendant in this amended answer has 

completely changed his defense in the action. 

"THE COURT: The Court will take that into consideration, Mr. Taylor. I I 

Later, during the course of trial, Mr, Taylor requested 

a recess to analize and to adjust to the amended answer, and the 

following allowance was made: 

"THE COURT: Very well, we will recess for ten minutes. 

"THE COURT: Court is in session. You may proceed. 

"MR. TAYLOR: You may return to the stand, Mr. Mitchell. I I 

The trial then proceeded until finished, a period of two days. 

The amended answer, filed the day of trial, admits the 

existence of the partnership and that the son had made advances of 

money towards the purchase of Yankee Flats. The answer then continues with these defenses: (I) Plaintiff "failed to keep his 
end of the agreement which was to return to Montana and help 

with the ownership use and labors on said real properties and 

failed to continue to make the payments agreed upon and to put 

in an equal amount of capital." (2) That "the defendant denies 

that he has failed to offer an accounting 9: f:." (3) The 

?defendant admits that he has possession of the premises and 

records 9: * * and defendant stands ready to account to plaintiff 

for his contributions * 9: +:.'I 

On June 24, 1974, almost a year after trial, an interlocutory order settling partnership accounts and dissolving the 

partnership was signed and filed by the district court. In 

September 1974, a judgment was entered which made final the terms 

of the interlocutory order. In the interlocutory order, the district 

court made these findings of fact: 

I Jc 2k the partnership remains in full force and 

effect, and all property in the 'Yankee Flats1 

tract is, in fact, partnership property. 

 hat the agreement between the partners required 

each to share equally in the amount of capital invested, and equally in the labors of the project. 

The plaintiff's (son's) share of capital investment 

is not fully paid, and he owes the Defendant (father) 

the sum of $2,949.29 in money. That from the date of 

the partnership agreement (May, 1964) until the date 

of the institution of this suit (August 4, 1970), 

the Defendant (father), on weekends and holidays, contributed approximately 302 days of labor (clearing 

brush, rocks, building roads, mending fences, etc. ) , 

and the Plaintiff (son), during said period, contributed 

approximately two days of labor; that the Plaintiff 

(son) owes the Defendant (father) 300 days of labor 

on the partnership property, payable either in kind 

or in cash at the prevailing rate for common labor. 

"That the relationship between the Plaintiff (son) 

and the Defendant (father) is so strained, unfriendly 

and irreconciable that the further continuance of the 

partnership is impractical. 11 

The court then dissolved the partnership and offered: 

It* * * upon application of either party, the Court will 

proceed to determine the respective interests of the 

parties in the partnership property, and partition the 

same in accordance therewith. 11 

From that judgment plaintiff appeals. 
Several issues are presented on appeal but the decisive 

issue is whether the amended answer was properly allowed to be 

filed under Rule 15(a), M.R.Civ.P. 

The applicable portion of Rule 15 (a), M.R. Civ. P. , 

provides : 

"* * * Otherwise a party may amend his pleading 

only by leave of court or by written consent of 

the adverse party; and leave shall be freely given 

when justice so requires. * *I1 

For the purpose of placing the issue in the proper frame work, we 

examine the reasons for and the background of Rule 15(a). That 

rule contains language identical to Rule 15(a) of the federal 

rules. 

In 6 Wright & Miller, Federal Practice and Procedure: 

Civil $5 1487, 1488, there are comments and reasons for Rule 

15 (a). 

$1487 The liberal amendment policy prescribed by 

Rule 15(a) does not mean that leave will be granted in all cases. 

Indeed, the text of the rule makes it clear that permission to 

amend is not to be given automatically but is allowed only 

I1 when justice so requires". Perhaps the most frequent reason 

given for denying leave to amend is that the opposing party will 

be prejudiced if the movant is permitted to alter his pleading. 

Thus, the facts of each case must be examined to determine if the 

threat of prejudice is sufficient to justify denying leave to 

amend. This entails an inquiry into the hardship to the moving 

party if leave to amend is denied, the reasons for the moving 

party failing to include the material to be added in the original 

pleading, and the injustice resulting to the party opposing the 

motion should it be granted. 

The court also may consider the good faith of the party 

seeking the amendment and the reasons for the movant's delay. 
$1488 Rule 15(a) does not prescribe any time limit 

within which a party may apply to the court for leave to amend. 

The policy of allowing amendments to be made at any time during 

the litigation is sound. It would be unreasonable to restrict 

a party's ability to amend to a particular stage of the action 

inasmuch as the need to amend may not appear until after discovery has been completed or testimony has been taken at trial. 

Nonetheless, in keeping with the purpose of Rule 15(a), which is 

to facilitate a determination of the action on its merits, a motion 

to amend should be as soon as the necessity for altering the 

pleading becomes apparent. 

In addition to considering the possible prejudice resulting 

from the moving ~arty's delay in making his amendment, some 

courts also have decided a motion for leave to amend on the basis 

of the reason given for the inaction. If the party can demonstrate 

to the court that the delay was not excessive and was excusable 

or that his failure to include the amendment in the original 

pleading was due to an oversight, the amendment may be allowed. 

However, in the absence of oversight or excusable neglect, courts 

have denied leave to amend when the moving party knew about the 

facts on which the proposed amendment was based but omitted the 

necessary allegations from the original pleading. Some courts also 

have held that a long delay by the movant constitutes laches so 

that a refusal to permit an amendment is warranted. 

In the instant case, the original answer denied the 

existence of a partnership; denied a contribution of capital by 

the plaintiff son and refused to give an accounting of partnership 

funds and assets. The amended answer turned the situation around 

by admitting both the partnership and a contribution of capital 

by plaintiff son and stated the defendant father now was ready 

to give a full accounting. The amendment then placed in issue 

how much labor had been contributed by each partner. 
When the amended answer was offered, the district court 

made no inquiry as to the reasons why these new facts were not 

pleaded in the original answer or why there was a delay of nearly 

two years in offering the amendment, or whether the amendment would 

impose a prejudicial burden on plaintiff. The district court 

in fact refused to grant even a continuance for plaintiff's 

counsel to study the amendment and prepare his case accordingly. 

Thus, following a liberal policy of amendment of pleadings as 

previously discussed, opportunity must be afforded the opposing 

party to adjust accordingly. Failure to permit this is error and 

demands a new trial. 

The judgment of the district court is vacated and the 

cause is remanded to the district court for a new trial. 

, We- Concur: <. B R 

t --"" *(L-3 a *%.- 5 

Chief Justike "-q a 8 se