No. 86-457 INTHE SUPREME COURT OF THE STATE OF MONTANA 1987

CHARLES MONTGOMERY, Plaintiff and Respondent,-vsDARREL L. HUNT and ANTHONY E. BROWN, Defendantsand Appellants.

APPEAL FROM: DistrictCourtof theNineteenthJudicial District, Inand for the Countyof Lincoln, The Honorable ArnoldOlsen, Judge presiding. COUNSEL OF RECORD: For Appellant: PatrickF. Flaherty, GreatFalls, Montana For Respondent: Donald L. Shaffer, Libby, Montana

Submittedon Briefs: May 7, 1987 Decided: June 25, 1987 Filed:Mr. Justice R.C. McDonough delivered the Opinion of the Court.

Darrel 

### L. Hunt and Anthony 

### E. Brown

## , defendants/appellants,appeal the judgment of the Nineteenth Judicial District Court awarding judgment to the plaintiff/respondent Charles A. Montgomery in the amount of $5,000and denying Hunt and Brown'smotion todischargeor in the alternative quash the writ of attachment and dismissing the counter claim of Hunt and Brown. The issue presented to this Court by Hunt and Brown is whether the District Court erred in issuing thewrit of attachment. We affirm. Hunt and Brown borrowed $5,000 from Montgomery and executed and delivered a promissory note as evidence of the debt. The notewas due December 27, 1985 andwas notpaid on the due date. This action was commenced upon the note on January 3, 1986 and Montgomery moved the court for awrit of attachment filing an affidavit of attachment, and an attachment bond. Hearing was held on the same date by the court and Montgomery was sworn and testified. The court thereupon on the same date, made written findings, conclusions and order for Writ of Attachment to issue to attach two all-terrainvehicles as requested in the affidavit of attachment. Hunt and Brown filed a counter claimFebruary 10, 1986, alleging damages in a sum in excess of $5,000 againstMontgomery for breach of fiduciaryduty, constructive fraud, creditor overreaching, wrongful attachment, and asked that their judgment be offset against the balance owed on the $5,000 note. In addition to the answer and counter claim, Hunt and Brown filed on the same date a motion to discharge
or in the alternativeto quash thewrit of attachment. A bench trialwashad in the cause on June 30, 1986,and
on July 22, 1986,the DistrictCourt handed down its findings

### which granted judgment to the plaintiff plus interest and costs of action,which judgment has now been paid, finding that attachment was proper and dismissing the defendants' counter claim for lack of evidence. Hunt and Brown in their brief allege the issues are: 1. 

### Did the District Court err in issuing a writ of attachment when the note was secured by an alleged mortgage on realproperty? 2. 

### Did the District Court err in ordering the issuance of the writ of attachment when the affidavit of attachment failed to show facts that the contractwas not securedby any mortgage or lien upon realproperty and failed to state the actual value of theproperty to be attached both as required by § 27-18-202, 

### MCA? 3. 

### Whether attachment statutes are to be strictly construed? 4. 

### Did the District Court err in failing to return judgment forHunt and Brown on their counterclaim for damages forwrongful attachment? Hunt and Brown claim the following wording in the note herein grants to Montgomery a real estate mortgage covering lots 23, 

### block 2, 

### West Troy: This note is given in connection with a certain othernote andmortgage executedby the undersigned to secure a loan of $5,000 

### on 1. 

### LOT 23 

### BLOCK 2 

### WEST TROY. 2. 1985

### HONDA ATV 250 

### SE (BigRed). 3. 1985

### HONDA ATV 250 

### SX 4. 1975 

### FORD 3/4 

### TON 4 

### x 4 

### ID. # 

### TZGYR X20471 

### AS SECURITY ON ABOVE CAPTION LOAN in the County of LINCOLN in the StateofMontana;

# .

# .

# . Also described as collateral are two all terrain vehicles which were the subjectto the attachment. Therewas no other note and mortgage as mentioned in the executed note. There

### is grave question as to whether or not this wording constitutes a hypothecation for real estate mortgage purposes. However, the parties do not dispute a security interest in the vehicles. The Uniform Commercial Code governs insofar as the personal property is concerned which states in

### B 30-9-501(4), MCA,as follows:
If the security agreement covers both real and personal property the secured party may proceed under this part as to the personal property or he may proceed as to both the real and the personal property in accordancewith his rightsand remedies in respect of the real property in which case the provisions of thispart do not apply. Itappears thatMontgomery did elect to proceed under theUCC and under the UCC 5 

### 30-9-503,MCA,Montgomery as the secured party on the default had the right to take possession of the collateral and the alleged erroneous issuance of the writ of attachment to take possession of the collateralwas harmless error. The same reasoning may be applied to the second error assigned by Hunt and Brown in this appeal. Hunt and Brown's third issue alleging that the attachment statutes are tobe strictly construed also is not applicable to the facts here. As to the fourth issue which is contained in the conclusionof the appellants' brief, did the court err in failing to return judgment for Hunt and Brown in their counterclaim for damages for wrongful attachment? Even assuming that thewrit of attachmentwas improperly obtained because the note was secured by a mortgage of real property and for failure of the affidavit to state facts as required in said S 

### 27-18-202, MCA, and assuming that the hearing on the issuance of the writ of attachment and the
sworntestimony ofMontgomery did not cure the defects in theaffidavit and no further oral motions were made to amend the affidavit of attachment as allowed by § 27-18-713,MCA, Hunt and Brown's counterclaim must fail. This is not a counterclaim and third party complainton an attachment bond
as provided by § 27-18-204, MCA. The surety was originally named as a third party defendantbutwas not served and later
was dropped as a party. Such action on the attachmentbond, cannot be brought in the attachment action but can only be brought after "defendantrecovers judgment" in the attachment action or when "the court finallydecides that the plaintiff
was not entitled to an attachment." See Yellowstone Livestock Commission v. Dupuis (1958), 133 Mont. 454, 325 P.2d 691. The counterclaim is then premised upon the common law notions of malicious prosecution or abuse of process, which is a suit in tort. To recover on such a suit, two elements must be present and proved, malice and want of probable cause. The record is entirely devoid of any proof in supportof Hart and Brown's counterclaim relative to fiduciary relationshipbetween theparties or of any constructive fraud
or creditor overreaching on the part of Montgomery, and in fact the record does show that Montgomery did act in good faith in bringing the action and attempting the attachment and had probable cause. The court found the debtwas owed to Montgomery by Hunt and Brown; that Montgomery was told that he could not have possession of the all-terrainvehicles when he asked for them after the debt became due and unpaid; and that plaintiff was informed by Hunt that Hunt and Brown were going to sell suchvehicles. This action on their part would convert the tangible attachable property to cash which would thenbe practically unreachable by Montgomery. Hunt and Brown failed to prove any malice (actual or legal) on thepart ofMontgomery. Proof ofmalice (actualorlegal) and want of probable cause are two essential elements of an action forwrongful attachment in tort. Attachment and Garnishment, § 596, 6 Arn.Jr.2nd. Brown 

### v. Guaranty Estates Corporation, (N.Car. 1954), 80 S.E.2d 645, Ray 

### v. City Bank and Trust Co. (DC Ohio 1973), 358 F.Supp 630. The ~istrict Court is affirmed. 

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