No. 86-155 

IN THE SIJPREME COURT OF THE STATE OF MONTANA 

1986 

KENNETH REINTSMA, RONALD HAVERLANDT, 

et al., 

Plaintiffs and Respondents, 

ALBERT LAWSON and DANA YATSKO, 

Defendants and Appellants. 

APPEAL FROM: District Court of the Eighth Judicila District, 

In and for the County of Cascade, 

The Honorable John McCarvel, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Cotter & Cotter; Patricia O'Rrien Cotter, Great Falls, 

Montana 

For Respondent: 

Jardine, Stephenson, Rlewett. & Weaver; K Dale Schwanke, 

Great Falls, Montana 

Submitted on Briefs: July 31, 1986 

Decided: October 30, 1986 
Mr. Justice John Conway Harrison delivered the Opinion of the 

Court. 

This is an appeal from a judgment of the District Court 

of the Eighth Judicial District in and for the County of 

Cascade, Montana, granting plaintiffs injunctive relief and 

compensatory and punitive damages. We affirm in part, 

reverse in part and remand. 

The plaintiffs and defendant Albert Lawson are all 

property owners in the Cooper Valley Estate subdivision 

located in Cascade County. This subdivision is a residential 

development, apparently comprised only of multi-acre lots 

designed to afford a convenient, rustic environment in which 

to live. To this end, each lot is subject to a number of 

restrictive covenants designed to maintain, as much as 

possible, the area's pristine state. The covenants expressly 

prohibit comprehensive logging operations. 

In June, 1984, Lawson sought and obtained a consent 

certificate from the Cooper Valley Owners Association 

allowing him to remove from his property diseased and 

over-aged timber. 

Plaintiffs, however, ultimately concluded that Lawson 

was removing far more than simply diseased and over-mature 

timber and so eventually filed this action in District Court. 

They sought as relief a permanent injunction enjoining 

defendant from conducting further logging operations within 

the development, compensatory damages for the diminution in 

value of their property, punitive damages and costs. 

Lawson counterclaimed, alleging generally that in 

pursuing this litigation, plaintiffs were converting for 

their own use the assets of Cooper Valley Estates, 

Incorporated, a corporation mostly comprised of the 

subdivision's property owners. Lawson also claimed that 

plaintiffs' suit was frivolous and sought punitive damages. 
The District Court held a bench trial in March, 1985. 

Though the record is incomplete, plaintiffs evidently 

withdrew their prayer for compensatory damages at the 

conclusion of trial. 

On November 7, 1985, the court entered its findings of 

fact and conclusions of law. Therein, the court found that 

Lawson's activities went beyond the scope of the consent 

certificate and had violated the restrictive covenants. The 

court concluded that Lawson was permanently enjoined from 

conducting any further logging operations within the 

development. The court further found that Lawson was 

responsible for rehabilitating his property, the cost of 

which was at a minimum $30,000, and that the counterclaims 

brought by Lawson were without merit. Finally, the court 

directed that the plaintiffs should recover an award of costs 

and attorney's fees and instructed plaintiffs to submit an 

affidavit detailing these fees. 

Believing the court's entry of its findings and 

conclusions constituted entry of judgment, Lawson filed, on 

November 21, a motion to amend the court's findings or for a 

new trial. In support of his motion, Lawson filed his own 

affidavit which indicated that between the time the trial was 

held in March and the time the court entered its findings and 

conclusions in November, he had spent over $43,000 on the 

rehabilitation of his own property. 

Before any action was taken on this motion, however, 

the court issued on November 27, 1985, a "Judgment Entered 

Pursuant to Court's Findings of Fact and Conclusions of Law 

of November 7, 1985.'' Here, the court, in addition to 

awarding plaintiffs' injunctive relief, awarded plaintiffs 

$30,000 in compensatory damages and stated that a hearing 

would be held to determine any rights to attorney's fees. 
Both parties filed motions to amend this judgment. On 

December 6, 1985, plaintiffs filed a memorandum in opposition 

to Lawson's motion to amend or for a new trial which he had 

earlier filed on November 21. Plaintiffs further filed their 

own motion to amend the court's findings, requesting both 

that the court award plaintiffs punitive damages and that it 

award plaintiffs attorney's fees and costs. Plaintiffs 

additionally filed a motion to strike Lawson's affidavit 

filed November 21 and, finally, filed affidavits detailing 

their attorney's fees and costs. 

On December 9, Lawson filed a supplementary motion for 

new trial. 

On December 13, 1985, the District Court held a hearing 

on the various motions and pleadings filed by the parties. 

Six days later it issued its order. The court, reiterating 

its earlier finding that Lawson's counterclaims were without 

merit, held that plaintiffs were entitled to punitive damages 

and awarded such damages "by way of compensating the 

plaintiffs for their attorney's fees and costs incurred in 

the proceedings." The court, however, awarded only one-half 

of plaintiffs' requested $25,000 attorney's fees, so that the 

punitive damage award was limited to $12,500, plus 

plaintiffs' costs. 

Finally, on January 6, 1986, the District Court entered 

its "Final Judgment." In this judgment, the court first 

restated that Lawson was enjoined from any further logging 

operations within the Cooper Valley Estates subdivision. The 

court then awarded plaintiffs' damages totalling over 

$46,000: $30,000 in compensatory damages; $12,500 

attorney's fees; and $4,190.49 in costs. 

Lawson now appeals the court's entry of its November 27 

judgment and its award of compensatory and punitive damages; 
he does not appeal the adequacy of the court's findings of 

fact and conclusions of law entered November 7. 

Plaintiffs cross-appeal the court's award of only 

one-half of the attorney's fees sought. 

I 

Appellant first argues that the District Court abused. 

its discretion by substituting its initial November 7 

judgment with its subsequent, altered judgment of November 

27. This argument is of course based upon the premise that 

entry of the November 7 findings and conclusions constituted 

entry of a judgment. We disagree. 

As noted, in its November 7 findings and conclusions, 

the court found that Lawson was responsible for the 

rehabilitation of his property, the cost of which was at 

least $30,000. The court further concluded as a matter of 

law that Lawson was permanently enjoined from conducting any 

further logging within the area. The findings and 

conclusions ended with the sentence, "Let judgment be entered 

accordingly." On November 8, the clerk of court entered in 

the judgment docket the court's findings and conclusions. 

Then on November 27, the court issued its judgment 

entered pursuant to its findings and conclusions. There, the 

court, in addition to enjoining defendant 's further logging 

operations, awarded plaintiffs $30,000 compensatory damages. 

Appellant contends that because the November 7 findings and 

conclusions were properly entered by the clerk, a proper 

judgment had been entered and the District Court was 

thereafter powerless to enter its November 27 judgment which 

materially altered its November 7 judgment. Appellant 

asserts he suffered prejudice because the District Court did 

not award plaintiffs compensatory damages under its first 

judgment, but did under its second. This, appellant 
concludes, constituted abuse of discretion where the 

plaintiffs had not filed any motion to amend the November 7 

judgment. 

Appellant's argument fails from the outset. This Court 

has long held that findings of fact and conclusions of law do 

not constitute the judgment, but merely form the basis upon 

which the judgments are subsequently to be rendered. 

Woodward v. Perkins (1946), 119 Mont. 11, 15, 171 P.2d 997, 

998; Conway v. Fabian (1939), 108 Mont. 287, 303, 89 P.2d 

1022, 1028; Galiger v. McNulty (1927), 80 Mont. 339, 351, 260 

P. 401, 403. 

In Woodward, supra, the District Court, as in our case, 

filed its findings of fact and conclusions of law prior to 

its entry of formal judgment. Appellant later appealed, 

inter alia, from a "decision" of the District Court, "set 

forth in [its] Findings of Fact, and Conclusions of Law 

. . ." In dismissing that portion of the appeal, this Court 

stated that the decision of the District Court based upon its 

findings and conclusions did not constitute a judgment and 

therefore was not appealable. Woodward, 171 P.2d at 998. 

Accord, Turnbull v. Brown (1953), 126 Mont. 548, 254 P.2d 

1085, (Adair, C.J., specially concurring). 

Likewise, entry in our case of the court's findings and 

conclusions did not constitute a judgment, notwithstanding 

the statement that judgment be entered. 

I1 

Appellant's second argument is that the District Court 

abused its discretion by awarding plaintiffs compensatory 

damages. Appellant specifically asserts that the court erred 

by awarding compensatory damages when plaint.iffs themselves 

dropped their prayer for such an award. 
We agree. We cannot affirm an award of compensatory 

damages where plaintiffs themselves dropped their demand for 

such an award. Appellant failed to provide us with a 

transcript of the proceedings below so that we are unable to 

determine whether this award is supported by sufficient, 

credible evidence. Typically, such a failure would work 

against appellant. Here, however, plaintiffs conceded in a 

post-trial motion that they were unable to provide sufficient 

evidence to justify a compensatory damage award: 

Counsel for the plaintiffs spent sometime 

trying to develop this issue prior to 

trial and finally determined that it was 

not worthwhile because appropriate proof 

could not be submitted. 

We therefore find the District Court erred in awarding 

plaintiffs compensatory damages and vacate this award. 

I11 

Next, appellant contests the District Court's award of 

punitive damages. In its December 19 "Award of Attorney 

Fees," the court awarded plaintiffs punitive damages by way 

of compensating plaintiffs for one-half their attorney's fees 

plus costs. 

Without intending to express any opinion on the 

propriety of a punitive damage award in general, we are not 

persuaded that an award of attorney's fees and costs, entered 

under the guise of punitive damages, is appropriate in this 

case. We recognize, however, that under the circumstances of 

this case, a punitive damage award may be proper. We 

therefore vacate this award, but remand this issue to the 

District Court for its determination of whether a proper 

punitive damage award is warranted. 
Finally, we note that the District Court stated in its 

findings and conclusions that Lawson was responsible for the 

rehabilitation of his properties and had estimated the cost 

to be at least $30,000. Lawson, prior to entry of the 

court' s November 27 judgment, had filed an affidavit stating 

that he had already expended approximately $43,000 in the 

rehabilitation of his properties. A review of the pre-trial 

proceedings and docket entries reflects that the motion of 

plaintiffs to strike Lawson's affidavit was never officially 

denied. We therefore remand this issue with instructions to 

determine whether Lawson has sufficiently rehabilitated his 

property. 

In conclusion, we approve the District Court's filing 

of its November 27 judgment, but reverse the court's award of 

compensatory damages. We vacate and remand the court's award 

of punitive damages. Upon remand, we instruct the District 

Court to determine whether appellant has satisfactorily 

rehabilitated his property. 

We concur: