No. 90-078 IN THE SUPREME COURT OF THE STATE OF MONTANA 19 9 0

FIRST SECURITY BANK OF BOZEMAN, Plaintiff and Respondent,

MILTON E. JONES and HELEN C. JONES; and AMERICAN LAND TITLE COMPANY, Defendants and Appellants.

APPEAL FROM: DistrictCourt of theEighteenthJudicial District, In and for the County of Gallatin, The Honorable Larry W. Moran, Judge presiding.

COUNSEL OF RECORD: ForAppellant: Thomas 

### E. Smith, Scot Schermerhorn, Moulton, Bellingham, Longo & Mather, P.C., Billings, Montana For Respondent: Calvin L. Braaksma, Landoe, Brown, Planalp & Kommers, P.C., Bozeman,MT 59715

Filed: Submitted on Briefs: May 16, 1990 Decided: June 26, 1990Justice John Conway Harrison delivered the Opinion of the Court.

District Judge Larry Moran of the Eighteenth Judicial District, Gallatin County, granted summary judgment to plaintiff First Security Bank of Bozeman in its effort to foreclose on five deeds of trustdeliveredby defendants Milton E. and Helen C. Jones for a promissory note. We affirm the summary judgment. The issuewhich we will review is whether the District Court erred inrulingthatFirstSecurityBank could judicially foreclose upon five deeds of trust in two counties, by filing separate actions in each of the counties, wherein the Bank sought a single judgment and a single, integrated foreclosure proceeding? The facts relevant to this appeal are simple and undisputed. On May 24, 1988, Milton and Helen Jones (Joneses)

## , husband and wife, executed a promissory note to First Security Bank (Bank) in the amount of $132,026.26. As collateral for the obligation the Jonesespledged five deeds of trust covering five parcels of real property, four parcels located in Gallatin County and one in Flathead County. The Joneses subsequently defaulted on the promissory note. The Bank proceeded to foreclose upon the deeds of trust as mortgages, filing actions in both Gallatin and Flathead counties. The complaint filed in Gallatin County sought collection of the promissory note and foreclosureof the fourdeeds of trust covering the four Gallatin properties. Likewise, the complaint filed in Flathead County sought collection on the samepromissory note and foreclosure of the deed of trust covering the Flathead realproperty. The two complaints reference to and incorporate each other and allege default of the samepromissory note,but clearly set forththat theBank seeksa single recovery with integratedand coordinated foreclosures and, thereafter, a single deficiency judgment

# . The Joneses answered, specifically setting forth as affirmative defenses that (1) the Bank violated § 71-1-222, MCA, which requiresbut oneaction for recovery of adebt or enforcement of a right secured by a real estate mortgage; and (2)the Bank was barred from collecting upon the debt or obtaining a deficiency judgment, or both, by virtue of the doctrines of the one-action rule,waiver and estoppel. The Bank filed a motion for summary judgment in the Gallatin County action. TheJonesesthenmoved the court todeny the Bank's motion for summary judgment and to enter summary judgment on their behalf prohibiting the Bank from obtaining any deficiency judgment against them. The District Court subsequently issued its Memorandum and Judgmentwhich granted theBank'smotion for summary judgment. The Joneses now appeal from the summary judgment. Summary judgment is appropriately granted where no genuine issue of material fact exists and themoving party is entitled to judgment as a matter of law. Rule 56(c)

### , M.R.Civ.P. The party seeking summary judgment has the burden of demonstrating absence of genuine factual issues. OIBagy

### v. First InterstateBank (Mont. 1990), 785 P.2d 190, 191, 47 St.Rep. 69, 71. The burden thenshifts to the non-moving party who must show the existence of a genuine issue in order to prevail. 

# a. To meet this burden, the non-moving party must proffer substantial evidence, not mere speculation and conclusory statements. Hando v. PPG Industries, Inc. (1989), 236Mont. 493, 500,771P.2d 956,959;Bensonv. Pyfer (Mont. 1989), 783 P.2d 923, 925, 46 St.Rep. 2033, 2035. In the case at bar ithas been shown that no genuine issue of material fact exists. The agreed upon facts establish that the Joneses executed thepromissory note and deeds of trust which are the subject of this action, delivered them to the Bank, and then failed to make payment as required in the note. Appellants argue that the Bank violated 9 71-1-222, MCA, Montana's noneaction rule,I1by filing simultaneous actions in the two counties where the real property pledged as security on the note is located. Inpertinent part, the statute reads: (1)There is but one action for the recovery of debt or the enforcement of any right secured by mortgage upon real estate, which action must be in accordance with the provisions of this part. 

# . . Section 71-1-222(1), MCA. Thepurpose of theone-actionrule I1[i]sto compel onewho has taken a special lien to secure his debt to exhaust his security beforehaving recourseto thegeneral assetsof thedebtor.'' Barth

v. Ely (1929),85Mont. 310, 320,278 P. 1002,1006 (quotingMerced Bank v. Casaccia (Cal. 1894), 37 P. 648). Also, the rule is intended to shield a mortgagor from multiple lawsuits where two separate actions, while theoretically distinct, are so closelyconnected that the two can and should be decided in one suit. Stallingsv. Erwin (1966);148 Mont. 227, 233, 419 P.2d 480, 483. See also Dietrich, The Montana Judicial and Non-Judicial Foreclosure Sale: Analysis and Suqqestions for Reform, 49 M0nt.L. Rev. 285, 298 (1988). The Bank did not intend to defeat the purpose of the oneaction rule by filing complaints in both Gallatin and Flathead counties. The Bank filed simultaneous foreclosure proceedings in

an attempt to comply with 5 25-2-123, MCA, which states that: (1) The proper place of trial for the following actions is the county in which the subject of the action or somepart thereof is situated:

(d) for the foreclosure of all liens and mortgages on real property. Section 25-2-123(1), MCA. Each complaintreferencesand incorporatestheother. The two complaints seek a single recovery, a single, integrated, coordinated foreclosure, and a single deficiency judgment thereafter. Innoway did theBank endeavor to circumventthe oneaction rule. We affirm the judgment of the District Court and concur with its Memorandum wherein it noted: The [Gallatin and Flathead] actions are not sequential actions, and it is sequential actionsthat are.usuallyat issue when the one action rule is raised. Nor is there any effort to keep one or the other Court in the dark regarding the simultaneous action for foreclosureand deficiency judgment.The Court concludes that Plaintiff's Complaints, though filed in two counties are, because of the language of theComplaints, one action, and Plaintiff is acting entirely within the stated purpose of the one action rule. The remedy being pursued is a foreclosure action and includes a deficiency claim in the same proceeding. The mortgagor is, essentially, being protected against a multiplicity of actions.

This case is a proper one for summary judgment, there being no genuine dispute over material fact. The District Court is affirmed.