No. 91-513 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

EDGEWATER TOWNHOUSE 

HOMEOWNER'S ASSOCIATION, 

Plaintiff, Respondent, 

and Cross-Appellant, 

ROGER HOLTMAN , 

Defendant, Appellant, 

and Respondent on Cross-Appeal 

APPEAL FROM: District Court of the Fourth Judicial District, 

In and for the County of Missoula, 

The Honorable Douglas Harkin, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Charles J. Tornabene; Patterson, Marsillo, 

Tornabene, Schuler & McKenna, Missoula, Montana 

For Respondent: 

Lon Dale; Milodragovich, Dale & Dye, Missoula 

Montana 

For Amicus Curie: 

William 0. Bronson; James, Gray & McCafferty, Great 

Falls, Montana (MT Big Sky Paralegals Assoc. ; Natl. 

Assoc. of Legal Assts. (NALA) ; Natl. Fed. of 

Paralegal Assoc.; and Legal Asst. Mngmnt Assoc.) 

JAN 12 1393 Submitted on Briefs: March 12, 1992 
Justice Karla M. Gray delivered the Opinion of the Court. 

Roger Holtman appeals from a judgment of the Fourth Judicial 

District Court, Missoula County, granting summary judgment in favor 

of the Edgewater Townhouse Homeowner's Association and dismissing 

his counterclaim. The Edgewater Townhouse Homeowner's Association 

cross-appeals the District Court's denial of claimed attorney's 

fees for attorney-supervised paralegal work. 

We phrase the issues on appeal as follows: 

1) Did the District Court err in granting summary judgment for 

the Association? 

2) Did the District Court err in dismissing Holtman's 

counterclaim? 

The Edgewater Townhouse Homeowner's Association (the 

Association) is a condominium association of eleven condominiums 

located in Missoula. The Association is governed by its articles 

of incorporation and its bylaws, filed respectively with the 

Montana Secretary of State and the Missoula County Clerk and 

Recorder. Pursuant to Art. I, Sect. 3 of the bylaws, all owners or 

occupants of the units are subject to the rules contained in the 

bylaws and articles of incorporation. Roger Holtman (Holtman) 

purchased Unit #1 in 1985. 

In March of 1988, the Association held meetings to discuss the 

installation of a new heating system forthe condominiums. Holtman 

opposed installing a new system and argued to either repair the 

existing central heating system or allow the unit owners to 
purchase individual systems of their choice. At a meeting on 

August 23, 1988, the unit owners present voted to install a WeilMcLain heating system. Holtman did not attend the meeting. After 

receiving bids, the Association assessed each member $3,900 to 

cover the costs. Holtman subsequently refused to pay the 

assessment or allow the Association access to his condominium to 

install the new system. 

On February 5, 1989, while Holtman was out of town, a neighbor 

heard running water in Holtmanls condominium. A meeting of the 

Board members was called and the situation was declared an 

emergency requiring entry into Holtmanls unit. After a unit owner 

entered Holtmanls condominium, the Association authorized a plumber 

to fix the leak and install the new heating system. When Holtman 

returned, he found that he was locked out of his damaged 

condominium, the new heating system was partially installed and, 

allegedly, asbestos contaminated his basement. He refused to allow 

further installation or pay for the heating system. 

The Association filed a complaint on February 17, 1989, 

seeking an injunction to require the installation of the new 

heating system, damages, costs and attorney's fees. Holtman 

answered by generally denying the Associationls allegations. On 

May 10, 1989, Holtman filed a third-party complaint against the 

individual unit owners, claiming they had deprived him of his 

property rights, invaded his privacy, and wrongfully contaminated 

his condominium with asbestos. Nearly a year later, the District 

Court granted the Associationfs motion for an "alternative writr1 to 
require the installation of the Weil-McLain heating system, and 

determined that the installation was necessary to preserve the 

property during the litigation. On September 17, 1990, the 

District Court granted the third-party defendants1 motion for 

summary judgment and dismissed the third-party complaint. Although 

the judgment was certified as final pursuant to Rule 54(b), 

M.R.Civ.P., Holtman did not appeal. 

On January 14, 1991, the Association moved for summary 

judgment on its complaint. Two weeks later, Holtman responded by 

filing a counterclaim against the Association without obtaining 

leave of court; the allegations against the Association mirrored 

those made against the individual unit owners in Holtmanls earlier 

third-party complaint. On February 14, 1991, the Association moved 

to dismiss or strike the counterclaim. On June 4, 1991, the 

District Court filed orders granting both the motion for summary 

judgment and the motion to strike the counterclaim. In entering 

judgment, the District Court awarded the Association $16,367.92 in 

attorney's fees; that amount was decreased by $4,000 in a 

supplemental judgment in response to Holtman's objection. Both 

parties appeal. 

Did the District Court err in granting summary judgment for 

the Association? 

Under Rule 56(c), M.R.Civ.P., summary judgment is proper when 

no genuine issue of material fact exists and the moving party is 

entitled to judgment as a matter of law. Summary judgment was not 

intended, nor can it be used, as a substitute for existing methods 

in the trial of issues of fact. Hull v. D. Irvin Transport (1984), 

4 
213 Mont. 75, 81, 690 P.2d 414, 417. 

In granting the Association's motion for summary judgment, the 

District Court stated that the Association complied with its bylaws 

and applicable statutes in changing the heating system and entering 

Holtmanls condominium. Specifically, it found that six of the 

eleven unit owners voted for installation of the heating system at 

the August 23, 1988, meeting. On that basis, the court further 

found that the quorum and voting majority requirements of the 

bylaws were met. We conclude that the District Court improperly 

decided disputed issues of fact. 

Insofar as the bylaws are pertinent here, one membership in 

the incorporated association is appurtenant to each unit. 

Consequently, each unit is allowed only one vote. As a result, 

there are a total of eleven votes in the Association. Regardless 

of the number of individuals who may co-own one unit, the unit 

nevertheless can cast only one vote at Association meetings. The 

bylaws also provide that a majority vote at a meeting at which a 

quorum is present is binding upon all unit owners. A quorum 

requires the representation in person or by proxy of 50% of the 

total authorized votes and a majority is defined as more than 50% 

of the total authorized votes. 

The District Court relied on the minutes of the August 23 

meeting in determining that the Association complied with its 

bylaws. The minutes list the six individuals present as Ken, Mike, 

Doug, Lois and Jerry, and Andrea. In numerous references in the 

record, the names ItLois and Jerry CovaultM appear to refer to the 
co-owners of one unit. Because each unit has only one vote to 

cast, it is possible that only five of eleven voting units were 

present at the meeting in question. If this is the case, no quorum 

existed because the bylaws require the presence of unit owners 

having 50% of the total authorized votes to constitute a quorum for 

the transaction of Association business. 

In light of Holtmanls contention that the ~ssociation did not 

comply with the procedures as required by its bylaws in deciding to 

change the heating system, a genuine issue of material fact exists 

regarding whether a quorum existed at the August 23, 1988, meeting. 

Absent a quorum, no decision made at that meeting is binding on 

other unit owners. We conclude that the District Court erred in 

granting summary judgment. 

Did the District Court err in dismissing Holtmanfs 

counterclaim? 

In responding to the Association's February 17, 1989, 

complaint, Holtman generally denied the allegations and did not 

assert a counterclaim. On February 1, 1991, Holtman filed a 

counterclaim against the Association without leave of court. The 

District Court determined that the counterclaim arose out of the 

same transaction or occurrence as the ~ssociation's complaint filed 

in February, 1989; therefore, it was a compulsory counterclaim 

governed by the timeliness requirements of Rule 13(a), M.R.Civ.P. 

Applying Rule 13 ( f) , M. R. Civ. P, which governs omitted 

counterclaims, the District Court dismissed the untimely 

counterclaim because Holtman did not obtain leave of court. 

Holtman does not dispute the District Court's characterization 

6 
of his counterclaim as compulsory under Rule 13 (a) , M.R. Civ. P. He 

argues that the District Court's result was unduly harsh and that 

fgjustice requires" the acceptance of the counterclaim under these 

circumstances. 

We look to Rule 13(f), M.R.Civ.P., in addressing this issue: 

When a pleader fails to set up a counterclaim through 

oversight, inadvertence, or excusable neglect, or when 

justice requires, the pleader may by leave of court set 

up the counterclaim by amendment. 

Although we have not interpreted this subsection of Rule 13, 

M.R.Civ.P., we have held generally that the decision to allow an 

amendment is left to the discretion of the trial court. Stanford 

et al. v. Rosebud County et al. (Mont. 1992), - P.2d -, 49 

St-Rep. 828-30. In interpreting the identical federal rule, the 

Ninth circuit Court of Appeals has held that a trial court's denial 

of leave to assert an omitted counterclaim under Rule 13(f), 

F. R. Civ. P. , is reversible only when it constitutes an abuse of 

discretion, even though the rule is generally applied liberally. 

Ralston-Purina Co. v. Bertie (9th Cir. l9?6), 541 F.2d 1363, 1367. 

We adopt that standard of review for the issue before us. 

In a case factually analogous to the one before us, the Third 

Circuit Court of Appeals affirmed a trial courtls dismissal of an 

untimely compulsory counterclaim for failure to meet the "leave of 

court" requirement of Rule 13 ( f) , F .R. Civ. P. Owens-Illinois, Inc. 

v. Lakeshore Lane Co, (3d. Cir. 1979), 610 F.2d 1185, 1188. Here, 

as in Owens, Holtman filed his counterclaim nearly two years after 

his answer and did not obtain leave of court to do so, as required 

by Rule 13 (f) , M.R.Civ.P. Under these circumstances, we hold that 

7 
the District Court did not abuse its discretion in dismissing 

Holtman's untimely counterclaim. To hold otherwise would render 

the "leave of courtfv requirement of Rule 13(f), M.R.Civ.P., 

meaningless. 

We note that the District Court's award and denial of certain 

attorney's fees is based in part on its grant of summary judgment 

to the Association. In light of our conclusion that summary 

judgment was in error, we vacate the award of attorney's fees. 

Affirmed in part, reversed in part, and remanded to the 

District Court for further proceedings consistent with this 

opinion. 

We concur: 
January 12, 1993 

CERTIFICATE OF SERVICE 

I hereby certify that the following order was sent by United States mail, prepaid, to the following 

named: 

Charles J. Tornabene 

PATTERSON, MARSILLO, TORNABENE, SCHULER & McKENNA 

113 South 5th East 

Missoula. MT 59801 

Lon Dale 

MILODRAGOVICH, DALE & DYE, P.C. 

P.O. Box 4797 

Missoula, MT 49806-4797 

William 0. Bronson 

James, Gray & McCafferty 

P.O. Box 2885 

Great Falls, MT 59403 

Natl. Fed. of Paralegal Assoc.) 

ED SMITH 

CLERK OF THE SUPREME COURT