No. 85-232 INTHE SUPREME COURT OF THE STATE OF MONTANA 1986

MEL PALIN d/b/a PALIN RANCH, Enterprises, PI-aintiff and Appellant,

GERBERT LOGGING, INC., a Montana corporation, Defendamt and Respondent.

FROM: District Court of the Fourth.JudicialDistrict, In and. 

### for the County of Missou.la, The Honorable James B. Wheelis, Judge presiding.

COUNSEL OF RECORD:

For Appellant: Small, Hatch, Doubek & Pyfer; John C. Doubek, Helena, Montana

For Respondent: T. K. Botsford, Missoula, Montana

Submitted on Briefs: Oct. 25, 1985 Decided: March 20, 1986

Filed: 

### MAR

## 20

## '1386Mr. Justice John C. Sheehy delivered. the Opinion of the Court.

Me1 Palin appeals from an order of the Fourth Jud-icial District Court, Missoula County, granting partial summary judgment in favor of Gebert Logging, Incorporated. We affirm. On January 

### 11, 1984, Me1 Palin, d/b/a Palin Ranch Enterprises entered into a written agreement with Gebert Logging for the sale and removalof timber from certain lands located in Granite County. The agreement provided among other things that Gebert would fell, load and remove logs to the Champion International Corporation plant at Bonner Monta-na;and that Gebert would repair all fences, gates and cattle guards and blede all roads to a smooth surface after the logging operations were completed. Pursuant to the contract Gebertpaid to Palin $20,000,ofwhich $10,000was a prepayment by Gebert for stumpage and the remaining $10,000

was to be held as a hond by Palinuntil the expiration of the agreement. Pursuant to the agreement, Gebert went upon the described lands, felled trees, and removed and delivered the logs to Champion's plant at Bonner. After the first $10,000 worth of logs had been delivered to Champion,Palinwas paidby Champion for his seller's share of the proceeds of the logs.When the agreement expired,Gebert demanded the $10,000 bond be returned to it. Palin refused, claiming that the land had been damaged, gates and roads also damaged and that Gebert had failed properly to perform the contract. Gebert commenced suit to recover its bond from Palin, 

### and through

### discovery learned that Palinwasnot in fact the owner of 

### the land described in the written contract, but that rather Palin'swifewas the record owner of the land. Palin contended by affidavit after suit commenced that since 1972 

### he had managed the real property of the Pa.l.in family which included the real property under the timber sales agreement, and that he entered into the timber sales agreement as agent for his wife with her approval and knowledge. Palin's wife filed an affidavit to the effect that she was aware of and had approved the timber sales agreement and that Palin had full authority and approval to act as her agent in contracting for the sale of the timber located on the realpropertywhich sheowned. The answers to interrogatories filed by Palin indicated that he neither owned the timber nor the real property covered by the contract nor had any written authority to execute the contract for the owner, hiswife. The District Court granted partial summary judgment in favor of Gebert for the sun nf $10,000 and accrued interest and dismissed Palin's counterclaim against Gebert for the damages to the lands that Palin had claimed. The District Court further found that Palin's actions in the premises constituted a breach of his duty of good faith and fair dealing. The partial summary judgment reserved for further hearing the determination of the amount of exempla-rydamages tobe awarded. The partial summary judgmentwas certifiedby the District Court for purposes of 

### appeal under Rule 54(b), 

### M.R..Civ.P. The issue hefore this Court is whether the grant of partial summary judgment in this casewasproper.Summary judgment is proper 

### if ~znderthe record before the district court there is no genuine issue as to any material fact and the moving party is entitled to judgmentas

a matter of law. Rule 56(c), M.R.Civ.P. Cereck 

### v. Albertsons, Inc. (1981), 195 Mont. 409, 637 P.2d 509; Gilleard v. Draine (1972), 159 Mont. 167, 496 P.2d 83; Roope

v. Anaconda Co. (1972),159Mont. 28, 494 P.2d 922. A summary judgment isproperwhen theparty opposing the motion fails either to raise or to demonstrate the existence of the genuine issue ofmaterial fact,or todemonstrate that the legal issue should not be determined in favor of the movant. State ex rel. Rurlington Northern v. District Court

(1972),159Nont. 295, 300, 496 P.2d 11.52,1155. The District Court determined t-hatthe contract between the plaintiff and the defendantwas covered under theUniform Commercial Code in § 30-2-107(2), MCA, and that itwas for a sale of goods for a price of more than $500 which requires the contract to be in writing. Section 30-2-201(1), MCA. Palin did not have written authority to execute the written contract as the agent of his wife an6 he therefore acted without authority. Section 28-10-203, MCA; Schlenz v. John Deere Co. (U.S.D.C. Mont. 1981), 511 F.Supp. 224. The wife, Hilldegarde Palin, cou1.d not ratify the acts of her husband retroactively in this case without the consent of Gebert. Section 28-10-213,MCA. The District Court further determined that prior to Gebert'smotion for summary judgment, Palinhad held himself out to Gehert and to the District Court as the owner of the timber and the land as a seller to Gebert, and not as an agent acting for an undisclosed principal without written authority.In Larry 

### C. Iverson, Inc. v. Rouma (1981),195 Mont. 351, 375, 639 P.2d 47, 60,we approved aholding fromanother jurisdiction that a contract entered into without the power to contract cannot be ratified or enforced, and that incapacity to contract cannot be removed by estoppel. In this case Palinhad nowritten authority,as requiredby law, to enter into 

### the timber sales agreement. The subsequent attempts at ratification by his wife give no life to his actions. The District Court acted properly therefore in entering judgment against Palin for the sum of $10,000, the amount of bond which he held,plus accrued interest thereon, andwas further correct in dismissingPalin's cross claim for damages to the realty, since he was not the owner thereof. Palin contends that when the contract is partly performed by theparties soughtto be charged,the statuteof frauds in the Uniform Commercial Code, S 30-2-201,MCA, has no application under Northwest Potatoes Sales, Inc. v. Beck

(Yont. 1984), 678 P.2d 1138, 41 St.Rep. 362; and that where both parties have performed and one party had significantly altered his position to his detriment, it is unconscionable to invalidate the contract by relying upon the statute of frauds, citing Bolz v. Myers (Mont. 1982), 651 P.2d 606, 39 St.Rep. 1747. Pal-incontends that the statute of frauds under the UCC does not require thatboth parties sign the contractbut that only the "partyagainst whom enforcement is sought" must sign the agreement which in this case would be the respondent Gebert

# . Gebert responds that the cited cases are not applicable here because itwas Gebert that altered itsposition based on Palin holding himself out as owner of the lands; that Gebert

### was at all times capable of performing the contract and did perform it; and 

### that it was Palin who lacked the authority and capability to sign the contract. We agree with Gebert and determine that neither Northwest Potato Sales, supra,nor Bolz 

### 5 Myers, supra, have any application to this case. The affirmative defense of estoppel cannotbe raised by Palin for the first time on appeal. Montana Seeds, 

### Inc. v. Hol-liday (1978),178Mont. 119,582P.2d 1223. Under the facts of this case, the contract 

### was unenforceable because it was not signed by the owner of the lands,norby aparty having authority inwriting to contract for the owners;and Palin,because he is not theowner of the lands, has no claim fordamages,

### if any,that Gebertmay have caused the lands. Thus there isno genuine issue ofmaterial. facts in this case and the District Court properly entered summary judgment. 

# A Q.

# 2- Justice

We Concur:

r 

### Chief Justice