No. 83-251 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1934 

KATHRYN L. WYMAN, individually and 

KATHRYN L. WYMAN and KAREN W. BAGEblAN, 

Plaintiffs and Appellants, 

HORACE C. WYI.IAN, Trustee, and G. 

IiEIqNETH ALLEN & GLADYS K. ALLEN, 

d/b/a MOTOR POWER EQUIPMENT CO. , 

Defendants and Respondents. 

APPEAL FROM: District Court of the Thirteenth Judicial District, 

In and for the County of Yellowstone 

The Honorable William J. Speare, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

Wright, Tolliver & Guthals, Billings, Montana 

For Respondents: 

Berger Law Firm; Arnold Berger, Billings, Montana 

Moulton Law Firm; B. E. Longo, Billings, Montana 

Filed: 

Submitted on Briefs: November 3, 1983 

Decided: January 26, 1984 

- 

Clerk 
Mr. Justice John C. Sheehy delivered the Opinion of the 

Court. 

Kathryn Wyman and Karen Bageman appeal a summary judgment entered against them in the District Court for the 

Thirteenth Judicial District, Yel-lowstone County. We affirm 

the District Court. 

In August of 1956, Horace and Kathryn Wyman, then 

husband and wife, entered into a lease agreement with G. 

Kenneth and Gladys Allen. The Allens became lessees of real 

property located in Yellowstone County, a portion of which 

was owned by the Burlington Northern Railway and leased to 

the Wymans. The lease between the Wymans and the Allens had 

a primary term of ten years with three consecutive three-year 

options for renewal. The lease also prescribed a penalty of 

double rental as liquidated damages, in the event the lessees 

held over. 

In 1964, Hora.ce a.nd Kathryn Wyman were divorced. The 

real property that was the subject of the lease agreement was 

transferred to a trust, for the benefit of Horace Wyman and 

Kathryn Wyman. Both Horace and Kathryn were made trustees, 

along with their daughter Karen Bageman. 

The trust agreement provided that the expenses of operation and maintenance of the trust were to be paid with checks 

co-signed by Horace Wyman and Kathryn F7yman. Two of the 

three trustees could revoke the trust, as well as borrow 

money for expenses and taxes. The final paragraph of the 

trust agreement read as follows: 

"7. Generally speaking, the aforementioned Horace C. Wyman shall have general 

charge of the operation of the business, 

and shall receive no fees or additional 

compensation therefor. In addition to 

the obligations hereinbefore set forth, 

the said Horace C. Wyman shall be 
obligated to report, at I-east quarterly, 

to the aforementioned Kathryn L. Wyman, 

of all receipts and expenditures of the 

trust." 

Although the lease was executed in August of 1956, the 

Allens did not take possession until February 1, 1957. 

Following the initial ten-year period of the lease, the three 

options for renewal were exercised, extending the lease 

period to January 31, 1976. According to Kenneth Allen, the 

renewals were exercised by his writing letters to Horace 

Wyman, notifying Wyman of the extension. 

During the early months of 1975, Horace Wyman and Kenneth Allen discussed modifying and extending the leasehold 

arrangement. They agreed that the terms of the leasehold 

should remain the same as before, with a raise j.n rent of 

$400, for a term of three years. In his answers to interrogatories, Horace Wyman stated that according to his recollection, a new lease agreement with the above provisions was 

drafted, dated February 1, 3975, and sent to Kathryn Wyman. 

In addition, Horace Wyman's attorney, in an affidavit, 

claimed that he and Horace Wyman met and went over the mod-ifications of the lease agreement. The modified document was 

given to Wyman's attorney's secretary for typing. Shortly 

thereafter, the attorney had a meeting with Kenneth Allen at 

which time he reported to Allen that the lease was being 

prepared, along with manila envelopes to be used to send the 

lease to Kathryn Wyman and Kenneth Allen. Kathryn Wyman 

testified that she never received a new lease agreement. 

The Allens paid the increased rent starting in February 

1975 and Kathryn Wyman received her portion of the payments. 

She also continued to co-sign the checks paying Burlington 

Northern an increased rent for the portion of the property 
subleased to the All-ens, such increase required after 1974. 

Karen Bageman was also avrare of the increased rental payments 

by the Allens. She testified that, between 1976 and 1980, 

she asked Horace Wyman numerous times what was taking place 

with regard to the rental property. He allegedly answered 

that a new lease was being drawn and that everything was 

being taken care of. Both Karen Baqeman and Kathryn Wyman 

claim that they were misled by Horace Wyman's assurances. 

In November 1977, the Allens wrote to Horace Wyman, 

advising him that they wished to renew the lease for another 

three-year period from February 1, 1978 to February 1, 1981. 

Horace Wyman wrote hack on January 31, 1978, ~aying, "The 

original 1-ease provided you an option to request a three year 

extension and this letter is to inform you that such extension is hereby granted." Again, it was asserted in interrogatories that Horace Wyman was acting under the assumption 

that a new lease had been executed. 

In March of 1980, Karen Rageman and Kathryn Wyman sent a 

letter to G. Kenneth Allen informing him that "henseforth any 

matters related to the term and lease payments of your tenancy must be previously approved, in writing, by any two of the 

three trustees, who as you know, are Horace Wyman, Kathryn 

Wyman and Karen Bageman." The letter noted that the original 

1-ease, with all available extensions, expired in August of 

1975 and that no current written executed lease agreement 

existed. The authors assumed that Kenneth Allen was not a 

party to a newly-written and executed lease and as of August 

6, 1975, was "a tenant under an oral agreement with Horace." 

The letter ended with the statement that: "If any of the 

facts assumed above are incorrect, please advise us accordingly so we can determine the true status of your tenancy." 
By a letter dated September 17, 1980, Karen Bageman and 

Kathryn. Wyman's attorney notified the Allens' attorney that 

the former: 

"deem Mr. Allen to have materially 

hreached the lease agreement entered into 

between himself and Horace and Kathryn 

Wyman on August 6, 1.956, for his failure, 

following the expiration thereof, to pay 

the holdover rental provided for in that 

document. I am writinq to further advise 

that should Plr. Allen be basing his 

present tenancy of the property in question upon any writing other than the 

original 1956 lease, that writing is void 

as having been executed by only one of 

two trustees required to bind the trust." 

On November 25, 1980, Kathryn Wyman and Karen Rageman 

filed a complaint in the District Court charging (1) breach 

by Horace Wyman of his fiduciary duties, making him liable 

for damages; (2) breach by G. Kenneth and Gladys Allen of the 

1956 lease agreement, making them liable for damages; and (3) 

unlawful detainer of the property by the Allens. Horace 

Wyman answered and dounterclaimed to recover damages arising 

from the actions of the plaintiffs. The Allens answered and 

counterclaimed to recover damages, asserting breach by the 

plaintiffs of their duties as trustees. 

The Allens vacated the premises on Ja.nuary 30, 1981. 

Motions for summary judgment filed by the defendants 

were granted and findings and conclusions were filed March 

10, 1983. Before the court were depositions of G. Kenneth 

Allen, Karen Bageman and Kenneth Wyman, and answers to interr0ga.tori.e~ given by Horace Wyma.n. The court found that all 

the negotiations regarding the leasehold extensions were 

between Horace Wyman and Kenneth Allen and that by agreement 

between Horace Wyman and the Allens, the lease was modified 

and extended on February 1, 1975. The rental payments 

through January 30, 1981, were made with the "knowledge" and 
"consent" of, and were "acknowledged and accepted" by all of 

the trustees. The court concluded, inter alia, that (1) 

Horace Wvman had the authority under the trust instrument to 

extend the leasehold agreements; (2) the plaintiffs waived 

any objection to the extension; (3) the plaintiffs were 

estopped from claiming unauthorized actions by Horace Wyman; 

and (4) the plaintiffs ratified the extensions by their 

"conduct in receiving and accepting al.1 of the benefits 

thereof. " 

The appellants raise the following issue on appeal: Did li 

the District Court err in granting summary judgment where 

there was a question as to whether the term of the lease was 

properly extended by Hora.ce Wyman. 

Kathryn Wyman and Karen Bageman contend that Horace 

Wyman had no authority to unilaterally modify or extend the 

lease, given the fact that both Kathryn and Horace signed the 

original lease. The trust a.greement geve all three parties 

to the agreement authority over the real property, to be 

exercised by two of the three. As to the summary judgment, 

Kathryn Wyman and Karen Bageman feel there is an unresolved 

issue as to whether Horace Wyman had authority to extend the 

lease agreement without the consent of one of the other 

trustees. They claim there was no waiver or acknowledgement 

of Horace Wyman's acts on their part, as they were unaware of 

their exact nature. 

Horace Wyman claims specific authority, granted in the 

trust agreement, to extend. and modify the lease with the 

Allens. He contends that his acts were consistent with 

previous practice, a.s he had always negotiated the lease 

a-rrangements with the Al.l.ens (including the extensi0n.s of the 

original lease). The acceptance of the rental checks by 
Kathryn Wyman past the acknowledged end of the original lease 

constituted ratification by Kathryn Wyman of his actions. He 

argues that Kathryn Wyman and Karen Bageman are now estopped 

from claiming improper acts by him. 

The Al-lens contend that the intent of the trust agreement was to give Horace Wyman charge of the operation of the 

trust, including the authority to lease the property. Furthermore, any protests by the other trustees at this point 

should not be persuasive, given the apparent ratification of 

Horace Wyman's acts. The Allens feel protected from Kathryn 

Wyman and Karen Bageman's claims by the fact that they did 

not know the trust existed. 

It is undisputed that the languaqe of paragraph seven of 

the trust agreement gave Horace Wyman general charge of the 

operation of the business. We are not to second guess the 

intentions of the parties when the language of the instrument 

is clear. Section 28-2-905, MCA; Spragqins v. Elvidge (Mont. 

1981), 625 P.2d 1151, 38 St.Rep. 493. We must give effect to 

the parties' intentions, as evidenced by the words used, the 

nature of the instrument, and the surrounding circumstances. 

Mathis v. Daines (Mont. 1982), 639 P.2d 503, 39 St.Rep. 73. 

Thus, upon examination of these factors, we find the language 

in this trust agreement to be dispositive of whether Horace 

Wyman had the authority to modify and extend the lease with 

the Allens. The language clearly expresses the intention of 

the parties to allow Horace Wyman to continue to handle the 

"business" which in this case is the lease of the property. 

The fact that both Kathryn and Horace Wyman signed the original lease is not dispositive of this issue. The circumstances, not the least of which was the marital status of the 
parties, had changed since that time and the trust agreement 

reflected those changes. 

It is also undisputed that, prior to the expiration of 

the original lease, Horace Wyman and Kenneth Allen agreed to 

increa-se the amount of the rental payments and extend the 

leasehold period. Both Kathryn Wyman and Karen Bageman 

testified that they knew of the increased payments. There 

was a period of time from the end of the ori.qi.na1 lease (by 

any calculation) to March 1980, approximately three years, 

during which Kathryn Wyman and Karen Eageman took no affirmative action. They allegedly made numerous requests of Horace 

Wyman, but did nothing to gain more positive answers to their 

questions. By such inaction, they ratified the lease extensions. In Audit Services, Inc. v. Francis Tinda1.1 Const. 

(1979), 183 Mont. 474, 477-78, 600 P.2d 811, 813, this Court 

found : 

"Section 28-2-304, MCA, states: 

"'Ratification of contract void for want 

of consent. A contract which is voidable 

solely for want of due consent may be 

ratified by a subsequent consent.' 

"Ratification may occur in either an 

express oral manner or solely by means of 

personal conduct. 

"Ratification is a form of equitable 

estoppel and ordinarily is applied 

strictly in an agency context, whereby a 

principal approves the unauthorized act 

of an agent. See Larson v. Marcy (1921), 

61 Mont. I, 201 P. 685. However, it is 

also applied in varying classes of cases 

including contracts. Generally, contract 

ratification is the adoption of a previously formed contract, notwithstanding a 

quality that,rendered it relatively void 

and by the very act of ratification the 

party affirming becomes bound by it and 

entitled to all the proper benefits from 

it. Shagun v. Scott Mfg. Co. (8th Cir. 

1908), 162 F. 209, 219. The contract is 

obligatory from its inception and may be 

signified from the commission or omission 
of acts. East Cent. Okl. Elec. Coop., 

Inc. v. Oklahoma G. & E. Co. (Okl. 1977), 

505 P.2d 1324, 1329. 

"Montana case law also has held that the 

subsequent recognition of a contract is 

the equivalent of ratification. This 

Court has stated: 

"'"Ratification" is defined to be the 

confirmation of a previous act done 

either by the party himself or by another. (Citing authority.) And a confirmation necessarily supposes knowledge of 

the thing ratified. (Citing authority. ) 

It follows that to constitute a ratification there must be an acceptance of the 

results of the act with an intent to 

ratify and with full knowledge of all the 

material circumstances.' Koerner v. 

Northern Pac. Ry. Co. (1919), 56 Mont. 

511, 520, 186 P. 337, 340. 

"It is the manifestation of the ratifying 

party which controls. The respondent's 

outward expressions and actions judge of 

his intention and his intent in the case 

- sub judice is clear." 

There can be no doubt that Kathryn Wyman and Karen 

Bageman knew that the lease arrangements had. changed, at 

Least in terms of the monthly payments, and that the payments 

continued well past the term of the original lease. Kathryn 

Wyman accepted her portion of the payments without protest. 

Both she and Karen Bageman were satisfied with Horace Wyman's 

answers for approximately three years. Such conduct is 

consistent with ratification, not rescission of the contract. 

They cannot now cla-im that Horace Wyman a.nd Kenneth Allen's 

lease agreement violates the trust agreement. 

Rule 56 (c) , M.R.Civ.P. requires that a motion for summary judgment be granted only if "the pleadings, depositions, 

answers to interrogatories, and admissions on file, together 

with the affidavits, if any, show that there is no genuine 

issue as to any material fact and that the moving party is 

entitled to a. judgment as a matter of law." 
We affirm the District court.'^ grant of summary iudgment 

as the alleged unresolved issues do not relate to material 

facts, or are resolved according to our determination that 

Horace Wyman had the authority to extend the lease. As a 

matter of law, the defendants were entitled to a summary 

judgment. 

We Concur: