No. 83-24 

IN THE SUPREPIE: COURT OF THE STATE OF MONTANA 

1984 

FALLON COUNTY, a political 

subdivision of Montana, 

Plaintiff and Respondent, 

-vsHUGH BRINDLEY, 

Defendant and Appellant. 

APPEAL FROM: District Court of the Sixteenth Judicial District, 

In and for the County of Fallon, 

The Honorable Alfred B. Coate, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Robert L. Johnson, Lewistown, Montana 

For Respondent : 

Denzil R. Young, Baker, Montana 

Submitted on Briefs: February 9, 1984 

Decided: SepteElber 6, 1384 

Filed :> 5d4 

Clerk 
Mr. Justice Fred J. Weber delivered the Opinion of the Court. 

This is an appeal from a judgment of the District Court 

of the Sixteenth Judicial District of Fallon County, awarding 

$500 per month rental from November 17, 1979 until the 

County's scraper is returned. We vacate the judgment and 

remand the cause for further proceedings. 

The issues presented on appeal- are: 

1. Did lessee's obligation to pay rent terminate when 

the scraper was rendered useless? 

2. Did lessee's attempt to return the scraper terminate 

his rental obligation? 

3. Did the District Court err in holding that the 

lessee was responsible for monthly rental payments until the 

scraper was returned to the County storage yard? 

4. Was the lessor obligated to mitigate damages? 

Hugh Brindley, an earth-moving contractor from Winnett, 

Montana, rented a Caterpillar Model 435 pull-type scraper 

from Fallon County on October 15, 1979. He signed a contract 

presented to him by the County and paid one month's rent of 

$500 in advance. The County's shop foreman watched Brindley 

load the scraper onto his truck to transport it from the 

County storage yard. Brindley winched the scraper's front 

wheels up and safety chained the scraper to his truck. He 

transported the scraper in this manner without incident to a 

worksite outside of Fallon County. 

Brindley testified that he attempted to transport the 

scraper hack to the Fallon County storage yard in Baker at 

the end of the prepaid, one-month period. He secured the 

scraper to his truck in the same manner in which he had left 

the storage yard. Approximately 24 miles from Raker, the 

scraper separated from the truck and sustained major 
structural damage. Separated parts of the scraper came to 

rest in a pasture owned by Richard Reiger. 

Unequipped to transport the separated scraper, Brindley 

helped Reiger repair the fence, returned to Winnett, and 

telephoned County Commissioner Gary Lang to report the 

accident. Commissioner Lang viewed the accident scene two 

days later. Neither Brindley nor the County made any effort 

to tow the scraper parts to Baker after the accident. 

During months of negotiation following the accident, the 

County made no demand that Brindley pay additional rental or 

that he return the scraper to the County storage yard. The 

County refused Brindley's offer to buy and transport to Baker 

a used scraper of the same age and model, which he had 

discovered for sale in Idaho. 

The October 15, 1979 rental agreement between Brindley 

a.nd Fallon County provides in pertinent part: 

"Lessee shall pick up the scraper and upon 

termination of this contract, shall return it to 

Fal-lon County. Lessee shall not be responsible for 

major structural damage to the scraper unless it 

can be shown that this damage was occasioned by his 

abuse . . .I1 

The agreement is silent as to duty to repair, fitness for use 

or destruction of the thing hired. 

On October 17, 1980, approximately one year after 

renting the scraper to Brindley, the County filed suit 

against Brindley claiming that "the scraper was wrecked and 

virtually destroyed, and has never been returned." The 

complaint further alleged that "the scraper, before its 

destruction, had a value in excess of $10,000. " The County 

asked "for the value of the scraper and for the value of its 

use at $500.00 per month from and after November 15, 1979 
The case wa.s tried before the court on April 21, 1982. 

The record contains no explanation as to why trial was 

scheduled more than a year after the last pleading was filed 

with the District Court. In the meantime, the scraper 

remained in Reiger's pasture. 

The District Court found that Brindley paid $500 to the 

County before taking possession of the scraper on October 17, 

1979; that the accident occurred in January, 1980; and that, 

a.s a result of the accident, the scraper sustained serious 

structural damage. The court concluded that the County had 

failed to prove the scraper was being tra-nsported in a 

negligent manner or that the defendant's method of 

transporting the scraper caused the accident. Having failed 

to prove that the damage to the scraper was "occasioned by 

his [the lessee's] abuse," the County was not entitled under 

its contract to recover for the damage to the scraper. 

The court further concluded that defendant's obligation 

to pay a monthly rental of $500 continued until defendant 

returned the scraper to Fallon County's possession. The 

court awarded the County $500 per month rental from November 

17, 1979 until the scraper is returned. The record contains 

no evidence that the scraper has ever been returned to the 

Fallon County storage yard. Appellant's counsel alleges that 

the County sold the scraper "as is" from Reiger's pasture 

after judgment was entered against Brindley. 

The record includes testimony by Commissioner Lang that 

the estimated value of the scraper at the time of the 

accident was $8,000. We note the amount of past due rental 

awarded to the County at the time of the August 16, 1982 

judgment was more than twice the estimated value of the 

scraper. 
Hon-. Fred J. Weber 

Justice, Supreme Court 

Room 414 Justice Building 

215 North Sanders 

Helena, Montana 59620 

CORRECTION. In preparing this opinion for publication, we noted in our verification of titles and 

citations the matters listed below. Corrections have 

been made on our copy of the opinion. 

October 4, 1984 

Fallon County v. Brindley, No. 83-24, Sept. 6, 1984 

Page 5, line 12 from bottom --- 150 Mont. at 261-62 should read 150 

Mont. at 361-62. 

-. WEST PUBLISHING COMPANY 

Box 43526 

St. Paul, MN 55164 
While the parties have raised several issues on appeal, 

we consolidate the first three issues into one question: Did 

the lease terminate on the date of the accident? We find 

this issue to be determinative. We need not address the 

issue of mitigation at this time. 

Section 70-1-607 (4) , MCA provides: "When hiring 

terminates. The hiring of a thing terminates . . . by the 

destruction of the thing hired. " This section and its 

predecessor apply to all things hired. In American Ma-chine 

Company v. Johnson (1971), 157 Mont. 226, 483 P.2d 921, we 

held that section 42-109, R.C.M. 1947 controlled termination 

of the lease of a "skidder" machine. In Solich v. Hale 

(1967) , 150 Mont. 358, 435 P. 2d 883, the statute controlled 

termination of a lease of premises in a building. 

Absent a contractual provision to the contrary, the 

lease terminates by law upon the destruction of the thing 

hired. Only express agreement to the contrary can preclude 

operation of the sta-tute. Kosena v. Eck (1981.), 195 Mont. 

12, 18, 635 P.2d 1287, 1290-91, citing Solich, 150 Mont. at 

341 

-2-63-62, 435 P.2d at 885. No such agreement exists in this 

case. 

In Solich, supra, the only factual issue presented, 

other than damages, was whether a building that had been 

partially gutted by fire was repairable or destroyed. Lessor 

argued that the building was destroyed and plaintiff's lease 

terminated by operation of law. This Court set forth two 

tests for determining whether section 42-109, R.C.M. 1947 

(the predecessor to section 70-1-607, MCA) applied. 

The first test, which the Court labeled an 

"untenability" test, is essentially a test for fitness for 

use : 
"Under this test the thing hired is considered 

destroyed: 'When destruction of the demised 

premises is of such a nature that it cannot be used 

for the purposes for which it was rented and cannot 

he restored to a fit condition by ordinary repairs, 

made without unreasonable interruption of the 

lessee's use.' Presbyterian Distribution Services 

v. Chicago National Bank, 28 Ill.App.2d 147, 171 

N.E.2d 86, 90." Solich, 150 Mont. at 362, 435 P.2d 

at 885. 

Under the second test, the Court considered the thing 

destroyed "if the cost of restoration . . . as it was 

immediately before the fire is more than one-half of the 

value of the property at the time of the fire." Solich, 150 

Mont. at 362, 435 P.2d at 885. 

The Court held that under both tests the evidence lead 

to the conclusion that the building was destroyed. The Court 

observed that "parts of respondent's business were located in 

both buildings. A destruction of even the 'so-called' north 

building would be sufficient to terminate the lease under the 

statute involved." Solich, 150 Mont. at 364, 435 P.2d at 

886. Under both the fitness-for-use and cost-of-repairs 

tests, "destruction" can mean less than complete 

obliteration. 

The record here indicates that the scraper's fitness for 

use ceased when it separated from Brindley's truck and 

"sustained serious structural d.amage." The County's 

complaint alleged that the "scraper was wrecked and virtually 

destroyed" by the accident. Commissioner Lang testified that 

the scraper was not fit for use, but that he had not 

investigated the cost of repairs. The record is silent as to 

the salvage value of the scraper, the cost of repairs, or how 

long it might take to return the scraper to fitness for use. 

The District Court failed to issue findings of fact on 

the fair market value of the scraper before the accident and 

the cost, time and feasibility of repairs to restore the 
scraper to fitness for use after the accident. Absent such 

findings, this Court cannot rule on whether the scraper was 

destroyed on the date of the accident and whether the lease 

terminated by operation of law. 

We vacate the judgment of the District Court and remand 

for appropriate findings and such proceedings as are 

necessary. 

We concur: 

4.d d. @I LbPD-Q 

Chief Justice