No. 89-76 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1990 

LYNN G. SCHWEIGERT and GLENNA J. 

SCHWEIGERT, 

Plaintiffs and Appellants, 

-vsWILLIAM V. FOWLER and ROSEMARY T. FOWLER, 

Defendants and Respondents. 

ri 

APPEAL FROM: ~istrict Court of the ~inth ~udicial ~istri&, 

In and for the County of Toole 

The Honorable R. D. ~c~hillips, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

~lizabeth A. Rest; Best Law offices, Great Falls, 

Montana 

For Respondent : 

David F. Stufft; ~risbee, Moore, Stufft & Olson, Cut 

Bank, Montana 

Submitted on ~riefs: Oct. 20, 1989 

Decided: January 2, 1990 

~i led: 
Justice Fred J. Weber delivered the Opinion of the Court. 

This appeal arises from a judgment following a 

bench trial by the District Court, Ninth Judicial District, 

Toole County, Montana. Plaintiffs alleged fraud in the sale 

of land and so.ught rescission of a contract for deed. Following trial, the court found in favor of defendants. Plaintiff appeals. We affirm. 

The controlling issues are: 

1. Are the District Court's findings of fact supported 

by substantial credible evidence? 

_. 

3 Did the District Court err in failing to order 

restitution for plaintiffs? 

3. Did the District Court err in failing to require 

Defendants to pay Plaintiff's expert witness fees? 

Lynn and Glenna Schweigert both grew up working on 

ranches. Lynn was raised in South Dakota and worked on 

various ranches from grade school through high school. 

Glenna was raised on a ranch in Montana. Lynn and Glenna met 

in Conrad, Montana while Lynn was working there as an 

ironworker. They married, and moved to various states while 

Lynn continued to do ironwork, eventually settling near 

Seattle, Washington. For approximately a year and a half in 

the mid-19601s, the Schweigerts moved back to Montana. 
Durinq this time they lived on the ranch owned by Glenna's 

father, helping him with ranching. They lived most of their 

married life in Washington, but desired to return to Montana 

to buy a ranch. Glenna's brother, Jack Hurley, is a rancher 

in Montana, and he beaan helping them search for a ranch to 

purchase. 

In 1985 Mr. Hurley heard that a ranch very close to his 

ranch, owned by William Fowler, was for sale. On inquiry he 

learned that the asking price was $450,000, which he determined was too high. In 1986 Mr. Fowler called Mr. Hurley and 

informed him that he had lowered the price to $300,000. Mr. 

Hurley learned from a realtor that the ranch had been appraised at $250,000, and that Mr. Fowler might be willing to 

take even less. Mr. Hurley then discussed the Fowler ranch 

with his father, Gordon Hurley, and they determined that they 

should tell the Schweigerts about it. Gordon and Jack Hurley 

took a short tour of the ranch in the spring of 1986, driving 

through it in Gordon's pick-up. During this tour, Mr. Fowler 

showed them a gravel pit and pasture reservoirs. 

In April of 1986 the Schweigerts decided to travel to 

Montana to view the ranch themselves. They arrived in Montana during a snowstorm. The next day they drove to the 

Fowler ranch but were unable to drive over the property 

because of the snow on the ground. However, they discussed 

the property with the Fowlers over the kitchen table. 
A few days later Mr. Schweigert and Jack Hurley drove 

through the ranch, and on another occasion the Schweigerts 

were both driven through the property by Mr. Fowler. During 

this trip they asked Mr. Fowler about the presence of leafy 

spurge and knapweed. Mr. Fowler stopped and showed them a 

leafy spurge plant. Shortly after this, Lynn Schweigert and 

Jack and Gordon Hurley flew over the ranch to view its 

boundaries. 

The Schweigerts decided to purchase the ranch, and the 

parties agreed to a price of $226,500. A Receipt and Agreement to Sell and Purchase was signed on April 17, 1986. This 

agreement did not state a total number of acres; rather the 

land was sold as a gross unit for a set price. Further, the 

agreement contained a clause which stated: 

Purchaser enters into this agreement with full 

reliance upon his independent investigation and 

judgment. No agreements, verbal or otherwi se, 

modify or affect this agreement. 

On April 18, 1986, the Schweigerts delivered $2,500 of earnest money to the Fowlers. They then moved from Washington 

to Montana. In April and June the Schweigerts seeded all of 

the spring crops for the 1986 growing season. After seeding 

the property, the Schweigerts executed a Contract for Pur- 
chase and Sale on June 16, 1986. In this contract the total 

purchase price was stated as $221,500. 

The Schweigerts continued to farm this property for the 

years 1986 and 1987. On August 7, 1987, they filed suit 

against the Fowlers, alleging fraud, and seeking rescission 

of the contract. On November 18, 1987, the Schweigerts were 

notified that they were in default under the terms of the 

contract. On December 22, 1987 they were notified that the 

contract for deed had been cancelled for failure to cure the 

default. On June 17, 1988, the Schweiqerts executed a 

quit-claim deed on the property to the Fowlers. 

I 

Are the District Court's findings of fact supported by 

substantial credible evidence? 

In reviewing the trial court's findings of fact and 

conclusions of law, this Court's standard of review is to 

determine whether the findings of fact are supported by 

substantial credible evidence. Lorenz v. Estate of Schillinq 

(Mont. 1989), 768 P.2d 869, 870, 46 St.Rep. 198, 200. This 

Court will not overturn findinqs of fact by the District 

Court unless they are clearly erroneous. Rule 52fa) 

M.R.Civ.P. 

In the present case, Plaintiffs are contendinq that Mr. 

Fowler made several fraudulent misrepresentations. They 
contend that he made the followinq misrepresentations in 

order to induce them to buy the land: 

a. The farm contained 750 acres of cropland., 

whereas it only contained 523 acres; 

b. The farm contained 80-100 acres of irrigated 

producing hay land, whereas it only contained 35-40 

acres of poorly producing hayfields; 

c. Approximately 298 acres of farm ground leased 

from the State of Montana were broken and ready for 

production, whereas 59.3 acres of this land were 

unbroken ; 

d. Approximately 11 acres of crop land bordering 

the Fowler property and adjacent to land owned by 

neighbor, Merrill Kovatch, were contained in the 

State lease which was part of the Defendants' 

property, whereas these 11 acres were actually 

owned by Kovatch; 

e. The property contained only approximately one 

acre of land which was infected with the noxious 

weeds leafy spurge and Russian knapweed, whereas 

600 acres were heavily infested with noxious weeds; 

f. A gravel pit located in Section 19 of the farm 

was contained in deeded acreage and was available 

for excavation as a source of needed income for a 

potential purchaser, whereas this gravel pit was 

actually owned by the Bureau of Land Management; 

g. The barn water well located on the property 

would water 250 head of cattle and provide adequate 

water for the residence, whereas the barn well went 

dry watering only 48 head of cattle; 

h. The reservoirs in the pasture land would hold 

water year round and provide adequate water for 120 

- 150 animal units, whereas two pastures were 

incapable of holding water year round, and went 

dry ; 

i. That the pastures had a carrying capacity of 

120 - 150 animal units, whreas they only had half 

this capacity; 
j. No more than 50 posts would need replacement in 

order to repair fences adequately to hold cattle, 

whereas over 400 posts needed repair. 

In Poulsen v. Treasure State Industries, Inc. (1981), 626 

P.2d 822, 825, 38 St. Rep. 218, 221, we addressed allegations 

of fraud, stating: 

In Lee v. Stockmen's Nat. Bank (1922), 63 

Mont. 262, 284, 207 P. 632, this Court set down the 

elements which a plaintiff must prove to make out a 

prima facie case of actual fraud: (1) a representation; (2) its falsity; (3) its materiality; (4) 

the speaker's knowledge of its falsity or ignorance 

of its truth; (5) his intent that it should be 

acted upon by the person and in the manner reasonably contemplated; (6) the hearer's ignorance of 

its falsity; (7) his reliance upon its truth; (8) 

his right to rely thereon; and (9) his consequent 

and proximate injury. 

Actual fraud is always a question of fact. 

Section 28-2-404, MCA. Fraud can never be presumed 

but must be proved by a preponderance of the evidence. Good faith will always be presumed and mere 

suspicion of fraud is not sufficient. (Citation 

omitted. ) 

Poulsen, 626 P.2d at 825. 

Plaintiffs have alleged that Mr. Fowler made fraudulent 

misrepresentations about ten different conditions of the 

ranch property. They contend that these representations were 

material, that Mr. Fowler knew them to he false, yet induced 

the Schweigerts to purchase the property in reliance on the 

misrepresentations. Plaintiffs contend that they did not 

know the statements were false, that they relied upon these 
misrepresentations, and that this reliance was justified. 

They contend they were damaged by the misrepresentations. 

The District Court made lengthy findings of fact on the 

issue of fraud, specifically addressing most of the ten 

alleged misrepresentations. The court made no specific 

findings as to whether each of these representations were 

actually made by Mr. Fowler, or as to the falsity of each 

separate allegation. Rather, the District Court found that 

as to each alleged misrepresentation the Schweigerts learned 

the true condition of the property before they signed the 

contract to purchase on June 16, 1986. Thus the court concluded that the Schweigerts did not rely on the truth of the 

asserted false statements. 

Initially, we note that the District Court found it 

significant that both Glenna and Lynn Schweigert had worked 

on ranches, and were familiar with farmland and farming 

methods. The court determined that the Schweigerts inspected 

the ranch property five times prior to siqninq any agreement. 

The court found it significant that Lynn Schweigert and 

Gordon and Jack Hurley flew over the property in an airplane 

to inspect the property. The Schweigerts seeded all of the 

spring crops for the 1986 qrowing season prior to signing the 

contract to purchase. The court noted that the property was 

open for inspection, prior to signing the intent to purchase 

and prior to signing the contract. Additionally, the court 
emphasized that the Schweigerts never complained of any 

misrepresentations until filing suit in August of 1987, 

although they spoke with various people about the property, 

including Mr. Fowler and his son. The court noted that they 

seeded, harvested, marketed and appropriated for their own 

use two consecutive crops for 1986 and 1987, making no 

complaints. 

In regard to the allegation that Mr. Fowler said the 

property contained 750 acres of cropland, whereas the ranch 

only contained 523 acres of cropland, the District Court 

found several facts to be relevant. On April 17, 1986, Mr. 

Schweigert told the Agricultural Stabilization and Conservation Service (ASCS) office in Toole County that he would he 

seeding a total of 235.3 acres during 1986. The court noted 

that the Schweigerts were aware that only one-half of the 

farmland would be cropped on any given year. On July 28, 

1986 Mr. Schweigert purchased hail insurance, representinq 

that his total number of acres for the crop year 1986 was 

235.7 acres. On December 9, 1986 Mr. Schweigert contracted 

to participate in the 1987 federal government price support 

and production price support programs. He acknowledged that 

he was to seed 129.4 acres of wheat and 103.8 acres of crop 

lands. He did not at that time complain about the number of 

farm acres. On November 24, 1986 the ASCS office informed 

the Schweiqerts that their cropland acres were 595.9 acres. 
The court also noted that ASCS maps are available from which 

a producer can determine how many acres he has seeded. 

In regard to the alleged misrepresentation by Mr. Fowler 

that the ranch contained 80 to 100 acres of irrigated, producing hayland, the court found that the Schweigerts were 

shown the hay land and knew that the hay land needed to be 

reseeded during their own visual inspection of the properties 

in April 1986. 

The Schweigerts place much emphasis on their allegation 

that the property was "infested with noxious weeds." The 

court, however, found that Lynn Schweigert knew there was 

knapweed infestation during the 1986 spring seeding. Jack 

Hurley testified that he discussed the knapweed with Lynn 

that spring, and Mr. Schweigert admitted that he sprayed for 

knapweed on forty acres of the property prior to siqning the 

purchase agreement. Additionally, the Tonle County weed 

supervisor testified that knapweed and leafy spurqe are 

observable at all times during the year. 

In reqard to the leafy spurge, the court found that John 

Wanken, a rancher in the area, testified that he saw leafy 

spurqe in full bloom on the property in May 1986, on the day 

of an auction that was conducted to sell Mr. Fowler's farm 

machinery. The court noted that Glenna Schweigert testified 

that she conversed with federal aqencies regarding the con- 
trol and containment of leafy spurge and knapweed during the 

summer of 1986. 

The Schweigerts contend that Mr. Fowler represented that 

he owned the gravel pit, when in fact it was located on 

Bureau of Land Management (BLM) properties. The court, 

however, found that Mr. Fowler told the Schweigerts that he 

did not know who owned the gravel pit. The court additionally noted that Glenna Schweigert made extensive notes of 

meetings with Mr. Fowler in April 1986, yet those notes 

contained no mention of the gravel pit. In September 1986, 

the Schweigerts received a map showing the location of all 

BLM properties on the ranch. Mr. Tom Stokes, an excavator, 

testified that in September 1986 Lynn Schweigert showed him 

the BLM map and told him he believed the gravel pit was on 

BLM land. The Schweigerts, however, made no complaints at 

this time about the gravel pit. 

As to the Schweigert's complaints about the reservoirs, 

the court observed that the reservoirs were open and could be 

readily inspected prior to the signing of the contract. It 

also noted that some years are "dry", and there will be no 

water for the reservoirs. The court found that the water 

well did not go dry. 

At trial the Schweigerts admitted that the issue of how 

many fence posts needed repair was a minor concern. The 

court determined that, in any event, the number of fence 
posts to be replaced was open, obvious and could he readily 

seen by the Schweigerts during their first inspections of the 

property. 

From our review of the record, we conclude that substantial credible evidence supports the findings of fact by 

the District Court. The Schweigerts had extensive background 

in farming and ranching prior to marriage. While married 

they spent 13 to 2 years working on a ranch owned by Glenna's 

father, which is only a few miles from the ranch they purchased. On their first trip to Montana in April 1986, they 

spent ten days to two weeks at the home of Glenna's brother, 

Jack Hurley. During this time they inspected the property 

numerous times. Glenna's father and brother were experienced 

ranchers in that area. They signed an agreement to purchase 

which contained a clause stating that they were relying on 

their independent inspection of the property. They physically worked the property for two months prior to signing the 

final contract for deed on June 16, 1986. During this time 

they had continuous opportunity to discover the true conditions of the ranch property. The Schweigerts inspected, 

seeded, and worked the property prior to siqning the contract 

to purchase. Even in the absence of their admitting that 

they knew the true condition of the property, it is clear 

from the court's findings that the Schweigerts did not rely 

on the truth of the alleged false statements. Substantial 
credible evidence supports this conclusion, and the District 

Court's conclusion that the Schweigerts failed to prove the 

elements of fraud by a preponderance of the evidence. 

The District Court also made extensive findings relating 

to the fact that the Schweigerts did not complain of any 

fraud or misrepresentation until late in 1987, and in fact 

treated and referred to the property as their own, before and 

even subsequent to filing suit in August 1987. Section 

28-2-1713, MCA, states that to accomplish rescission a party 

must "rescind promptly upon discovering the facts which 

entitle him to rescind. . . ," and must restore or offer to 

restore the property which was received under the contract. 

The District Court noted that the Schweigerts admitted that 

they were aware of all alleged misrepresentations by spring 

of 1987, yet continued to work the property and appropriate 

the crop for their own use. The Schweigerts neither informed. 

the Fowlers of the alleged fraud, nor offered to tender the 

property back. As late as October 1987 the Schweigerts were 

treating the property as their own and representing to third 

parties that they owned the property. We conclude that these 

findings by the District Court are supported by substantial 

credible evidence, and were properly considered by the District Court in analyzing the fraud issue. We affirm the 

District Court's conclusion that fraud was not proven. 
Plaintiffs allege that the District Court erred in 

trying this solely as a case for rescission, which foreclosed 

any attempt to prove damages for fraud. We conclude that it 

is unnecessary to discus5 this issue since plaintiffs failed 

to prove fraud. 

Did the District Court err in failing to order restitution for plaintiffs? 

The Schweigerts contend the District Court should have 

ordered Fowlers to pay restitution to them of approximately 

$110,000. This amount includes Schweigertsl down payment of 

$40,000, improvements to the property valued at $8O,OOO, and 

payments on certain loans. The Fowlers sold the property 

prior to trial for $241,000. The Schweigerts contend it is 

"unfair" to allow Fowlers to benefit from selling the land 

twice. Plaintiffs urge several theories to support this 

contention. 

Plaintiffs contend that S 71-3-1302, MCA, allows them a 

purchaser's lien against the property. That statute 

provides : 

Purchaser's lien on real property. One who 

pays to the owner any part of the price of real 

property, under an agreement for the sale thereof, 

has a special lien upon the property, independent 

of possession, for such part of the amount paid as 

he may be entitled to recover back, in case of a 

failure of consideration. 
This statute is not helpful to the Schweigerts. It only 

applies to a case where there is a failure of consideration 

and the purchaser is entitled to recover part of the amount 

paid. In the present case, the District Court did not grant 

rescission; hence, there was no failure of consideration. 

cf. Warner v. Peterson (1988), 762 P.2d 872, 45 St.Rep. 1939 

(allowing a purchaser's lien where rescission was granted). 

Plaintiffs urge application of Montana'? anti-forfeiture 

statute, S 28-1-104, MCA, which states: 

Relief from forfeiture. Whenever by the terms 

of an obligation a party thereto incurs a forfeiture or a loss in the nature of a forfeiture by 

reason of his failure to comply with its provisions, he may be relieved therefrom upon making 

full compensation to the other party, except in 

case of a grossly negligent, willful, or fraudulent 

breach of duty. 

However, this statute is also not helpful to S~hwe~gerts. 

They did not of=er to pay Fowlers full consideration for the 

property. 

Finally, Schweigerts contend that restitution is appropriate because Fowlers have been unjustly enriched, citing 

Robertus v. Candee (1983), 205 Mont. 403, 670 P.2d 540. This 

allegation ignores the fact that Schweigerts are the defaulting purchasers, and the contract for deed expressly stated 

that in the event of purchaser's default, all payments made 

and any improvements to the property would be retained by the 

sellers. Restitution is normally denied to a defaulting 
purchaser. Burnham, Contract Damages in Montana Part 11: 

Reliance and Restitution, 45 Mont.L.Rev. 1, 19 (1984). This 

view was implicitly acknowledged in Robertus, where the 

non-breaching injured party was allowed restitution from the 

party that breached or repudiated an oral contract. 

Additionally "[ulnjust enrichment is an equitable doctrine wherein the plaintiff must show some element of misconduct or fault on the part of defendant, or that the defendant 

somehow took advantage of the plaintiff ." Randolph V. Peter-- 

son v. J.R. Simplot Co. (Mont. 1989), 778 P.2d 879, 883, 46 

St. Rep. 1463, 1468; Brown v. Thornton (1967), 150 M0n.t. 150, 

156, 432 P.2d 386, 390. While this standard may state an 

"overly restrictive view of the availability of restitution," 

Burnham, at 12, it is appropriate in the present case. The 

Schweigerts failed to establish misconduct on the part of 

Fowlers, and the equities of the present case d.0 not support 

a theory of unjust enrichment. 

We conclude that Schweigerts have failed to present any 

basis for restitution. 

111 

Did the District Court err in failing to require Defendants to pay Plaintiff's expert witness fees? 

The Schweigerts contend that the District Court erred in 

fail-inq tc require the Fowlers to pay $293.50 in fees in- 
curred when Fowlers deposed two of Schweiqerts' expert 

witnesses. 

In October 1987, counsel for Fowlers requested through 

interrogatories the names and addresses of all expert witnesses to be called by the Schweigerts at trial. This request included summaries of the experts ' testimony. The 

Schweigerts, however, did not produce names of any experts 

until July 7, 1988, at which time they produced names of 

seven expert witnesses, but no addresses or summaries of 

testimony. Counsel for Fowlers then moved the court for a 

protective order, or in the alternative, a continuance of the 

trial, since trial was set for July 26, 1988. However, the 

parties agreed that certain expert witnesses would be deposed 

prior to trial, and the court did not rule on the motion. 

Counsel for Fowlers deposed two expert witnesses in July 

of 1988. In a posttrial motion to alter or amend the judument, the Schweigerts raised the issue of whether Fowlers 

should he required to pay fees associated with these depositions. That motion was denied by the District Court. On 

appeal, the Schweigerts contend that the District Court 

should have required the Fowlers to pay these fees, citing 

Rule 26 (b) (4) (C), M.R.Civ.P. Our analysis of this rule, 

however, discloses no error. The rule does not require the 

court to order payment of expert witness deposition fees, 

unless the court has ordered this discovery, and even in that 
instance, the court may not order payment if manifest injustice would result. We conclude that the District Court did 

not err in failing to require Fowlers to pay expert witness 

fees. 

Affirmed. 

4-AJ / Chief Justice