### No. 79-83 IN THE SUPREME COURT OF THE STATE OF MONTANA 1980

NEWTON MARVIN, Plaintiff and Respondent,

VS

# . C. LEO HARGRAVE, Defendant and Appellant.

Appeal from: District Court of the Eleventh Judicial District, In and for the County 

### of Flathead. Honorable Robert Sykes, Judge presiding. Counsel of Record: For Appellant: Murphy, Robinson, Heckathorn and Phillips, Kalispell,

Montana Daniel Johns argued,Kalispell, Montana For Respondent: Hash, Jellison, O'Brien and Bartlett, Kalispell,Montana Kenneth O'Brien argued, Kalispell,Montana

Submitted: September 12, 1980 ~ecided: 

## @@T 

## 22 1980Mr. Justice Gene B. Daly delivered the Opinion of the Court. This 

### is an appeal from a judgment entered by the Honorable Robert C. Sykes, Flathead County DistrictCourt, following a nonjury trial, awarding plaintiff Newton Marvin the sum of $3,736.24 pursuant to a land clearance contract. Defendant C. Leo Hargrave and his wife entered into a written land clearing agreement with Bruce Kiser on August 16, 1974, for the purpose of converting approximately 100



### acres of timberland intoadditional farmland. According to the agreement, 

### Kiserwas to cut "all 

### -timber, except aspen, and clear stumps and brush and pile same inasclear a

manner aspossible inreturn for alltimber rights." The contract continued: "Large stumps 

### willbe tried, and if they can't be moved they may be left. Timber 

### will be cut to the brow of the slopes for shelter belt, also shelter from A.M.C. Road. All slash disposal money 

### willgo toBruce for clearing Harrding logging job--also slash from thisjob." Kiser began clearing the land, but had cleared only a small portion of the 100 acres when, with the consent of Leo Hargrave on November 2, 1974, he assigned his interest in the contract toNewton Marvin. Atthe 

### timeof the assignment, Hargrave explained toMarvin that the land 

### was being cleared so that 

### itwould be suitable for farming. For approximately two years, Marvin performed the contract as

### required, removing the timber and receiving the money from 

### its sale.Marvin ceased work inNovember 1977. By this 

### time Marvin had cleared the property so as to comply with the 

### terms of a StateFireHazard Reduction Agreement which had been executed for the acreage by Hargrave with the Montana StateDepartment of Natural Resources and Conservation(DNRC) inaccordance with the section 76-13-408, MCA. The requirements of this agreement having been 

### met, DNRC informed Hargrave that the remaining slash disposal deposit being held under the agreement was no longer necessary and could be retrieved. In accordance with the assigned contract, an initial slash deposit, released earlier by DNRC, was paid toMarvin by Hargrave. The payment was made during the two-year period Marvin worked on the land. The last slash deposit of $3,616.24 was returned inMarch 1978. However, instead of paying this sum toMarvin, Hargrave retained the money since he believed thatMarvin had not fullyperformed under the contract. In an attempt to secure the monies contained in the slash deposit, Marvin filed 

### a claim and notice of a mechanic's lien on March 10, 1978. Marvin then filed suiton June 22, 1978, alleging thatHargrave had failed topay him the slash disposal deposit inconsideration for services performed in clearing the land. Marvin asked for $3,840.04 indamages, plus attorney fees, and that the property involved be sold and the proceeds applied to the judgment inaccordance with the lien. Hargrave counterclaimed alleging that because of Marvin's failure toproperly perform the contract he lost the use of the 100 acres 

### as farmland for a period of three yzars and unless Marvin proceeds toproperly complete the performance due, he 

### willlose future use of the land. Hargrave stated his damages 

### were asyet undetermined. During trial Hargrave sought to introduce evidence showing certain expenditures he had made incompleting the work allegedly leftundone by ~arvin.Marvin objected on the ground that the evidence was incompetent, irrelevant andimmaterial to any issue inthe cause and that 

### itwas beyond the scope of any contention that Hargrave had setforth in the case. The trial courtprovisionally allowed the evidence to be introduced subject toMarvin's right to renew his objection atthe completion of 

### all testimony. Atthe conclusion of the trial, Marvin by written motion renewed his objection to the evidence. The trial court granted the motion on the ground that the claimed expenses 

### were outside the scope of the pleadings and the pretrial order and that defendant failed topresent 

### testimony attrial that a claim or bill for said expenses was

ever presented toMarvin. Judgment infavor of Marvin for $3,736.24 was entered

on September 17, 1979. The judgment was based on the court's findings thatHargrave had wrongfully converted the slash disposal monies. Following entry of judgment, Hargrave moved the court, inthe alternative, to amend the findings; for judgment for the defendant; for a new trial; and for leave to amend the counterclaim so as to conform with the offered evidence pertaining to the expenditures made incompleting the clearing of his land. Defendant's motions 

### were denied, and amended findings

### were filed on October 9, 1979, again finding that Hargrave's actions constituted conversion. The court then ordered that each party have offsetting judgments against the other for $1,000 inattorney fees. Hargrave was allowed attorney fees pursuant to section 71-3-124, MCA, because Marvin had failed to establish hismechanic's lien. Hargrave appeals. On appeal defendant raises the following issues:1. 

### id the ~istrict Court 

### err in striking allevidence pertaining tomonies expended or about tobe expended by defendant for clearing his land? 2. Did the DistrictCourt errby not permitting amendment of the counterclaim so as to

### meet the objection that the evidence pertaining to the expenditures was beyond the scope of the pleadings? 3. Did the District Court 

### err by awarding attorney fees to plaintiff? As to the firstissue, 

### we note that plaintiff brought this suit alleging that, although he had performed inaccordance with the land clearing contract, defendant refused torelease toplaintiff certain slash disposal monies due and owing as consideration. Defendant inresponse denied that plaintiff had fullyperformed under the contract and alleged, by way of a counterclaim, that because of this failure, defendant lostthe use of his land 

### as farmland for

a period of atleast three years. The general rule 

### is thatwhere a person by his contract charges himself with an obligation, possible and lawful, to be performed, he must perform inaccordance with the con

### tract terms. Smith v. Zepp (1977), 173Mont. 358, 567 P.2d 923; Brown v. FirstFederal Savings and Loan Association of Great Falls (1969), 154 Mont. 79, 460 P.2d 97; 17A C.J.S. Contracts, 8459 at594. Ithas alsobeen stated that a valid defense to an action on a contract 

### arises when the obligation toperform the actallegedly required was dependent on
some other activity which the other party 

### was todo, but failed to so perform (i.e., performance of a condition is precedent to the right of payment)

# . See White v. Hulls, 

### et al. (1921), 59 Mont. 98, 195P. 850; 17A C.J.S. Contracts, 5452 

### at566.

### In this instance defendant, inhis answer to the complaint, denied thatplaintiff fullyperformed under their contract. Defendant then alleged attrial thatbecause of plaintiff's failurehe was relieved of any contractual duty to release the slash disposal money toplaintiff as payment for services. With thisbeing the case, defendant was entitled topresent evidence in support of his position. The issue now becomes whether the rejected evidence supports defendant's position as stated above. The offered evidence deals with expenditures made by defendant inhiring others to complete the work allegedly leftundone by plaintiff. Certainly, when a defendant is required to expend money to hire others towork inclearing land, which a plaintiff under contractwas to 

### clear as 

### "clear aspossible," this gives rise to an inference that plaintiff failed to fullyperform under his contract. Such is the case here, and thus, the trial 

### court should have allowed defendant topresent evidence of the expenditures to support his denial of plaintiff's allegation that he (plaintiff) fully performed and 

### was entitled to the slash disposal money. It 

### should be noted that this Court does not find that defendant's position as tononperformance under the given contract isdeterminative inthis case. We

### merely conclude thatdefendant should have been permitted tointroduce the offered evidence in support of thatdefense. Nor do 

### we find that the court's failure to admit the evidence constitutes reversible error. Defendant attrialwas able to introduce evidence showing the condition of the land after plaintiff finished his work, as

### well as evidence thathe hired others to finishwork allegedly leftundone by plaintiff. Defen-

### dantwas only denied the introduction of evidence indicating the expenses he incurred inhiring the outside parties. Consequently, inlightof the evidence presented in support of defendant's position, the fact that he was unable to introduce evidence as tohis expenses did not so prejudice defendant's case that a different resultwould have been reached had the evidence been allowed in. In regard to defendant's contention that the District Court erred innotpermitting him 

### to amend his counterclaim,



### we acknowledge that even absent the amendment the offered evidence arguably should have been allowed to show damages

as to defendant's claim that he lost the use of his land as farmland. However, because this evidence is 

### not of the nature that to exclude it 

### results ina differentoutcome and because the trial court found for plaintiff, thereby rejecting defendant's allegation of nonperformance as well ashis counterclaim, 

### we need not consider this issue further than to find there was no reversible errorby the District

### Court. As 

### to the final issue on appeal, defendant merely asserts that because plaintiff did not fullyperform pursuant to their contract, he was not entitled toprevail in 

### this action, and thus, is

### not entitled to attorney fees. As 

### already stated, defendant was able topresent evidence in support of his defense of nonperformance and 

### was not prejudiced atthe trialcourt level inthisregard. Having then concluded there

### was no reversible error attrial, and plaintiff having prevailed on a 

### conversion claim, we cannot find the DistrictCourt erred inawarding him attorney fees. The judgment of the DistrictCourt is ,'-



### hereby affirmed.We concur: 

# %.A J4%4 Chief Justice



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