No. 81-245 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1982 

SAWYER-ADECOR INTERNATIONAL, INC., 

Plaintiff and Appellant, 

-vsB. C. ANGLIN, et al., 

Defendants and Respondents. 

Appeal from: District Court of the Fifth Judicial District, 

In and for the County of Beaverhead, The Honorable Frank Blair, Judge presiding. 

Counsel of Record: 

For Appellant: 

Burns, Dwyer & Chaffin, Dillon, Montana 

For Respondents: 

Frank M. Davis, Dillon, 14ontana 

W. G. Gilbert, 111, Dillon, Montana 

Cleland, Hurtt, Witt & Weil, Fittsburg, PA 

Submitted on Briefs; April 1, 1982 

Decided: June 24, 1982 

Filed, .JUN 2 4 1982 
Mr. Justice John C. Sheehy delivered the Opinion of the Court. 

Appeal by Sawyer-Adecor International, Inc. (Sawyer) 

from a judgment dated March 31, 1981, rendered against 

Sawyer in the District Court, Fifth Judicial District, 

Beaverhead County. The District Court quieted title to 

three unpatented mining claims (the Grouse claims), and further 

granted defendant James V. Joyce specific performance of a 

contract between him and Sawyer, or in the alternative, gave 

Joyce a judgment against Sawyer for $144,000, with interest 

from March 20, 1976. 

On consideration of the whole record, we affirm the 

District Court. 

Specific Performance 

In and prior to May 1975, Sawyer was the record owner 

of 64 unpatented lode mining claims in the Lemhi Pass area 

in Beaverhead County. In that month, negotiations commenced 

between Arthur E. Granger, representing Joyce, and Fred 

Maxey, the president of Sawyer, culminating in a "Memorandum 

of Intent," dated July 24, 1975. 

The first paragraph of the memorandum provided: 

"1. In consideration of JOYCE undertaking 

mining, geologic and geophysical work of 

the SAWYER properties in Lemhi Pass, Montana, 

to the extent of a minimum of $6,400.00 worth, 

which will be recorded as assessment work 

for the year ending August 30, 1975 by 

JOYCE at the Beaverhead County Courthouse in 

Montana. SAWYER grants an option period to JOYCE 

for six months --- August 1, 1975 to February 1, 

1976. Further, if an additional $6,400.00 

worth of work is performed by JOYCE, the option 

may be extended to August 1, 1976. JOYCE may 

recommend, but only SAWYER may decide if this 

additional work may be undertaken. At the end 

of either option period, JOYCE may exercise this 

option to pick up a mining lease agreement based 

on that agreement enclosed in a letter dated 

June 4, 1975 addressed by Fred Maxey to Arthur 

E. Granger. " 
Joyce performed the assessment work for the year ending 

August 30, 1975, through Arthur E. Granger, who conducted, 

supervised and paid for the work. Joyce paid Arthur E. 

Granger $6,500 for doing that work. Assessment affidavits 

for the period involved, to August 1, 1975, were filed, on a 

group basis, with the county clerk and recorder, by Granger. 

In other words, the assessment work as required by the 

memorandum of intent was performed by Joyce through Granger. 

If one reads again the first paragraph of the memorandum 

of intent, as set forth above, one will find an internal 

conflict in the paragraph respecting the time in which Joyce 

could exercise the option. The first sentence gives Joyce 

an option from August 1, 1975 to February 1, 1976. However, 

the last sentence of the paragraph provides that "[alt the 

end of either option period JOYCE may exercise this option. . ." 

The last sentence does not require Joyce to exercise the 

option within the period specified in the first sentence. 

At any rate, the mining lease (its terms are unimportant 

here) was never executed between Joyce and Sawyer. 

On February 4, 1976, Sawyer, through its president, 

wrote to Granger that the company was considering the sale 

of its mining claims in Beaverhead County and asked Granger 

to "start contacting possible interested parties, with a 

view to initiating negotiations with them." Sawyer offered 

Granger a compensation of 10 percent of the sale price over 

the first $25,000 if the sale was consummated. Sawyer addressed 

the same letter to Dudley Davis and ~ick Barron on the same 

basis for the solicitation of negotiations. 

Upon receipt of the February 4 letter from Sawyer, 

Granger found that Joyce was interested in purchasing the 

mining claims of Sawyer, and thereupon negotiated with 
its president. On March 8, 1976, Sawyer and Joyce executed 

a "letter of intent" respecting a purchase. It provided for 

a purchase price of $100,000 with $25,000 downpayment upon 

the signing of the contract of purchase and sale, including 

$1,500 to be paid at the time of the signing of the letter 

of intent. The balance was to be payable over a period of 5 

years. Particularly, the March 8, 1976 letter of intent 

contained the following paragraphs: 

"5. The conditions and terms of the proposed 

contract of Purchase and Sale mentioned hereinabove are subject to the final approval of 

the Board of Directors of SAWYER. 

"6. Sixty (60) days after notice is given 

to JOYCE of Board approval of these conditions 

and terms, JOYCE shall consummate the contract 

of Purchase and Sale, and shall pay SAFJYER the 

cash down payment mentioned [the $25,000 mentioned 

above]. If after sixty (60) days have elapsed 

after such notice JOYCE has not consummated the 

contract of Purchase and Sale, then JOYCE shall 

forfeit unconditionally to SAFJYER the sum of 

$1,500 referred to in section 3 above." 

On March 20, 1976, Granger, on behalf of Joyce, gave 

Sawyer a check for $1,500 as required in the-letter o.f intent. 

The agreement for Purchase and Sale is dated April 9, 

1976 and is executed by James B. Joyce. Sawyer never executed 

the purchase and sale agreement mentioned and provided for 

in the letter of intent dated March 8, 1976. 

The president of Sawyer testified that Sawyer's board 

of directors considered Joyce's proposed contract at a 

meeting on March 31, 1976, and rejected the proposal because 

a higher offer had been received from another party. The 

president further testified that this information was 

communicated by him to Granger by telephone soon after the 

board meeting, at which time Granger requested that the 

earnest money check for $1,500, which Granger had delivered 

at the time of the execution of the memorandum of intent, be 

returned to him and that his signature be cut from the check. 
Sawyer, through Maxey, did not immediately return the 

$1,500 check, but simply left it in a file uncashed. However, 

on July 26, 1975, some 15 months later, Sawyer, through 

its president, returned the check to Granger. In the meantime, 

Sawyer had made a deal to sell the 64 claims to Tenneco for 

a total consideration of $244,000. 

Sawyer, as plaintiff, brought an action in the Beaverhead 

County District Court on October 2, 1978, seeking to quiet 

title to the 64 unpatented lode mining claims. On February 

14, 1980, Joyce filed an amended answer, crosscomplaint and 

counterclaim seeking quiet title in himself to the Grouse claims 

(more hereafter) claiming (1) that he is entitled to a 

mining lease under the option agreement dated July 24, 1975; (2) 

to a deed for all 64 of the claims upon performance by him 

of the terms of the contract under the letter of intent 

dated March 8, 1976; and (3) that he was owed $6,600 [sic] for 

the assessment work he had done for Sawyer. 

The District Court made findings of fact and conclusions 

of law and entered judgment as we have indicated in favor of 

Joyce. Sawyer contends, and it appears correct, that the 

District Court adopted verbatim the findings of fact and 

conclusions of law presented by Sawyer. The appeal by Sawyer 

followed from the judgment in the normal course. 

The issues raised by Sawyer that relate to the specific 

performance judgment are these: 

1. Whether the District Court committed reversible 

error in adopting verbatim the findings of fact and conclusions of law requested by Joyce and in adopting verbatim 

the post-trial brief of Joyce as the opinion of the court? 

2. Whether the evidence supports the findings of fact 

and conclusions of law adopted by the court and whether the 

District Court erred in finding that the expired "option" to 
lease could be unilaterally revived and converted into a 

contract for purchase of 64 unpatented lode mining claims? 

3. Whether the District Court could rely on estoppel 

to determine that a contract existed between Sawyer and 

Joyce? 

4. Whether the District Court erred in awarding 

damages to Joyce for breach of contract in the absence of 

pleadings or proof? 

Verbatim Adoption - of Proposed Findings 

The continuing practice of verbatim adoption of proposed 

findings by district courts in judge-trials remains a sore 

point in this state, especially to losing counsel who see 

therein a lack of due consideration by the district courts of 

their parties' contentions of fact and law. We expressed 

our disapproval of adopting verbatim the prevailing parties' 

proposed findings and conclusions in Tomaskie v. Tomaskie 

(19811, - Mont. - , 625 P.2d 536, 38 St.Rep. 416, ad in 

that case referred to Canon 19, Canons of Judicial Ethics, 

144 Mont. at xxvi-xxvii. In In Re Marriage of Jensen (1981), 

- Mont. - , 631 P.2d 700, 703-711, 38 St.Rep. 1109, where 

the District Court had adopted verbatim findings and conclusions, 

it was suggested by appellant that a lower standard should 

exist for the review by us of findings and conclusions 

drafted by counsel for the prevailing party than exists 

under the "clearly erroneous" standard of Rule 52(a), 3I.R.Civ.P. 

We declined to adopt that suggestion in Jensen. Again, in 

City of Billings v. Public Service Com'n. (1981), - Pllo n t . 

, 631 P.2d 1295, 38 St.Rep. 1162, we met the same problem, 

repeated that we disapproved of the practice of adopting 

verbatim findings and conclusions submitted by the prevailing 
party, but restated that the standard for review of the 

findings and conclusions remains the same, citing United 

States v. El Paso Gas Co. (1964), 376 U.S. 651, at 656, 84 

S.Ct. 1044, at 1047, 12 L.Ed.2d 12, at 17. 

We continue to disapprove, heartily and stoutly, the 

verbatim adoption of proposed findings and conclusions. 

We have expressed the reasons on several occasions. We are 

not compelled, however, when in appellate review we are 

confronted with a verbatim adoption, to find such an inherent 

fault therein that the prevailing party must be reversed. 

Although the "clearly erroneous" standard of Rule 52(a), 

still applies to verbatim findings, it is equally incumbent 

upon us to apply, in appellate review of equity cases and 

proceedings of an equitable nature, the rule that we review 

all questions of fact arising upon the evidence presented in 

the record, whether the evidence is alleged to be insufficient 

or not, and to determine the same, as well as questions of 

law. Section 3-2-204 (5) , MCA. There is in that statutory 

requirement for our appellate review a measure of protection 

for the losing party coming to us on appeal, at least in equity 

cases such as this. 

Whether the Record Supports the Findings and Conclusions 

of -- the ~istrict Court 

The critical facts found by the District Court in 

connection with the contract for purchase of the mining 

claims were: During the period from August 30, 1975 to 

March 8, 1976, Joyce was at all times ready and able to 

enter into the lease agreement in accordance with the memorandum 

of intent dated July 29, 1975; during that period, the 

defendant Joyce performed the $6,500 annual representation 

(assessment) work; Sawyer started negotations with Joyce and 
others for a sale of all the mining claims which changed the 

lease into a contract for purchase by Joyce for the sum of 

$100,000; pursuant to the contract Joyce offered and Sawyer 

accepted a check for $1,500 in accordance with the proposed agreement of sale; the letter of intent of March 8, 1976 was 

executed with the authority of Sawyer's board of directors; 

Sawyer unreasonably withheld its formal consent to the 

agreement of sale accepted by Joyce and led Joyce to believe 

that a formal contract had been entered into by keeping the 

tendered downpayment of $1,500 while at the same time Sawyer 

was conducting secret negotiations for the sale of the 

property to others; on July 26, 1977, Sawyer returned to 

Joyce the $1,500 downpayment on which date Joyce discovered 

the purported sale to Tenneco. 

Sawyer contends that the District Court erred in 

characterizing the memorandum of intent of July 24, 1975 as 

a lease when in fact it was an option to lease; that the 

assessment work was consideration for the option; that the 

lease never became effective; that no completed purchase and 

sale contract was entered into; that no evidence exists in the 

record to support the finding that the "lease and option" 

merged in a contract. 

We can disregard the purported mining lease between the 

parties, and whether it matured into a contract for purchase, 

because in reality no mining lease ever existed between the 

parties. Sawyer never executed a mining lease. It is true, 

however, that because of the ambiguous language of paragraph 

one of the memorandum of intent of July 24, 1975, Joyce, 

having performed the assessment work required, either had an 

option for a mining lease that expired on February 1, 1976, 

or he may have such an option even now to procure a mining 
lease upon the unpatented lode mining claims. The real 

question confronting us in this case is whether the execution 

by Sawyer and Joyce of the memorandum of intent on March 8, 1976, 

the execution of the agreement to purchase by Joyce on April 

9, 1976, and the delivery of the $1,500 check to Sawyer 

constituted a mutually binding contract between Sawyer and 

Joyce for the sale of the mining claims to Joyce. 

When we review a cause on appeal under section 3-2- 

204(5), MCA, our review and determination follow the appellate 

rules set forth in Lurnby v. Doetch (1979), Mont . I 

"In resolving this issue, we are guided by 

a number of principles established by this 

Court. The credibility of witnesses and the 

weight to be given their testimony are matters 

for the District Court's determination in a 

nonjury case. Corscadden v. Kenney (1977) , - Mont. , 572 P.2d 1234, 1237, 34 St.Rep. 1533, 1537. 

Thus, in examining the sufficiency of the evidence, 

we must view the same in a light most favorable 

to the prevailing party, and we will presume the 

findings and judgment by the District Court are 

correct. Hellickson v. Barrett Mobile Home 

Transport, Inc. (1973), 161 Mont. 455, 459, 507 

P.2d 523, 525. We will not overturn the findings 

and conclusions of the District Court unless 

there is a decided preponderance of the evidence 

against them, and when the evidence furnishes 

reasonable grounds for different conclusions, 

the findings of the District Court will not 

be disturbed. Morgen and Oswood Const. Co. v. Rig 

Sky of Mont. (1976), 171 Mont. 268, 275, 557 

P.2d 1017, 1021. The burden of proof is on the 

appellant. Schuman v. Study Com'n. of Yellowstone 

Cty. (19781, - Mont . - , 578 P.2d 291, 292, 35 

St-Rep. 386, 388." 

To determine that a contract existed in this case, for 

the sale by Sawyer to Joyce of unpatented lode mining 

claims, we must find that the parties consented to the same 

thing in the same sense from the record in the case. Section 

28-2-303, MCA. The essential elements of consent of the 

parties to the contract are that the consent must be free, 

mutual, and communicated by each to the other. Section 28- 

2-301, MCA. 
Indubitably, the parties exhibited some degree of 

mutual consent when they executed (Sawyer with the approval 

of its board of directos) the March 8, 1976 letter of intent. 

Without setting it forth -- in haec verba, the March 8, 1976 

letter of intent provided that Sawyer would warrant title to 

the mining claims and would sell them to Joyce for $100,000; 

that upon signing a contract for the purchase and sale approved 

by Sawyer's board, Joyce would pay $25,000; that upon signing 

the March 8, 1976 letter of intent, Joyce would pay, and did 

tender $1,500 as earnest money to be held by Sawyer and to 

be part of the cash downpayment of $25,000; that the balance 

of $75,000 was to be paid over 5 years under a promissory 

note signed by Joyce, bearing interest at 10 percent per 

annum. Then followed the provisions which we have above set 

forth providing that the conditions of the proposed contract 

for purchase and sale were subject to the final approval of 

Sawyer's board of directors and that the balance of the first 

cash downpayment would be due from Joyce 60 days after the 

board of directors had approved. 

On April 9, 1976, Joyce executed an agreement to purchase 

the unpatented lode mining claims. That agreement meets 

exactly each and all of the conditions contained in the 

letter of intent of March 8, 1976. However, the agreement 

executed by Joyce added a provision that, in the event title 

to the mining claims be deemed defective, Joyce was given 

the option to acquire only such mining claims as bore good 

title with a pro rata reduction of the purchase price. To 

that extent, therefore, the acceptance by Sawyer through the 

written agreement of April 9, 1976 of the conditions in the 

memorandum of intent of March 8, 1976, was in variance. 
To constitute a contract, a proposal must be accepted 

in the very terms in which it was made. Schwartz v. Inspiration 

Gold Mining Co. (Mont. 1936), 15 F.Supp. 1030, 1037; J. 

Neils Lumber Co. v. Farmers' Lumber Co. (1930), 88 Mont. 

392, 397, 293 P. 288, 290; Glenn v. S. Birch & Sons Const. 

Co. (19161, 52 Mont. 414, 420, 158 P. 834, 836. The question 

of the existence of a contract does not end at this point, 

however. 

Section 28-2-504, MCA, provides that " [a] n acceptance 

must be absolute and unqualified or must include in itself 

an acceptance of that character which the proposer can 

separate from the rest and which will bind the person accepting." 

The only provision in the April 9, 1976 agreement of purchase 

that is different from the March 8, 1976 letter of intent is 

the pro rata reduction of the purchase price for any mining 

claims to which Sawyer had a defective title. In the March 

8, 1976 letter of intent, Sawyer warranted "that it owns 

certain mining claims in Beaverhead County, Montana." Joyce's 

proposal to reduce the purchase price in case Sawyer's title 

failed seems to take into account Sawyer's warrant of title. 

It could be argued therefore, that Joyce's ~pril 9, 1976 

agreement was an absolute acceptance, and not qualified as a 

new proposal. If Sawyer's warrant of title was good as to 

all the mining claims, there would be no pro rata reduction of 

the purchase price. 

We find that Joyce's written acceptance, by the executed 

written agreement of April 9, 1976, was an acceptance which 

includ~d "in itself an acceptance of that character which the 

proposer [Sawyer] can separate from the rest and which will 

bind the person accepting." Section 28-2-504, MCA. 
Sawyer did not turn down Joyce's written agreement to 

purchase because of the added provision relating to failed 

title. Rather on March 31, 1976, while its March 8, 1976 

letter of intent was still in effect, Sawyer determined 

unilaterally that it would reject - any offer from Joyce under 

the March 8, 1976 letter because it had now obtained a 

better offer in price. Whatever other provision Sawyer might 

have required in connection with its contractual power to 

have its board of directors approve any future written contract, 

under the letter of intent of March 8, 1976, Sawyer absolutely 

bound itself to contract with Joyce to sell the mining 

properties to him for $100,000. 

The March 8, 1976 letter of intent constituted at 

least a continuing offer (if not a contract) from Sawyer to 

Joyce to sell him the unpatented lode mining claims for 

$100,000. Sawyer reneged on the purchase price by determining 

unilaterally on March 31, 1976 that it would not sell the 

property to Joyce for $100,000. Sawyer's board of directors 

never got around to considering Joyce's proposal, in his 

written agreement, for a prorata reduction of the purchase 

price for failed title. 

If the March 8, 1976 letter of intent is to be construed 

as a continuing offer rather than a binding contract, it 

could be revoked by Sawyer at any time before its acceptance 

by Joyce, but not afterwards. Section 28-2-511, MCA. In 

order to revoke the offer of March 8, 1976, Sawyer must have 

communicated that revocation to Joyce before he accepted the 

continuing offer. Section 28-2-512, MCA. That revocation 

should have been communicated by some act on the part of 

Sawyer informing Joyce of the revocation of the offer. 

Section 28-2-501, MCA. Here Sawyer's president testified that 
at some unspecified time he telephoned to Granger that 

Joyce's deal was off because Sawyer had gotten a better 

offer. No direct communication was had with Joyce on this 

subject by Sawyer. The evidence shows that Joyce never knew 

of the telephone conversation or of the revocation until 

after Sawyer returned the $1,500 check, some 15 months 

later, on July 26, 1977. Of course if Granger was Joyce's 

agent in the transaction, with the actual or ostensible 

authority in Granger to receive such a communication of 

revocation, then the telephone call to Granger would be 

sufficient. There is, however, nothing in the record to 

indicate that the telephone call to Granger occurred before 

the April 9, 1976 written agreement submitted by Joyce. 

Joyce's acceptance, by the executed agreement of April 9, 

1976 therefore, preceded the communication to him of Sawyer's 

revocation of the offer, again assuming arguendo that the 

March 8, 1976 letter of intent was an offer. 

This brings us to the third issue raised by Sawyer, 

whether the District Court properly considered estoppel in 

determining that a contract existed between Sawyer and Joyce 

for the sale and purchase of the mining claims. 

The District Court stated in its opinion (a brief also 

submitted by Joyce, and adopted verbatim by the court) that 

"elementary principles of estoppel" bound Sawyer to its 

contract with Joyce. 

The acts relied upon by the District Court to constitute 

estoppel against Sawyer were that Joyce had performed $6,500 

of annual representation work at the behest of Sawyer; that 

while the option to enter into a mining lease was still open 
Sawyer started negotiations with Joyce and with others for 

the purpose of making a sale of the mining claims; that 

Sawyer agreed to sell Joyce the mining claims for $100,000; 

that Joyce tendered Sawyer $1,500 as a downpayment, in the 

form of a check which was accepted by Sawyer; that the March 

8, 1976 letter of intent was executed by Sawyer's corporate 

offices and duly authorized by its board of directors; that 

Sawyer unreasonably withheld its formal consent to the 

agreement of sale accepted by Joyce, while at the same time 

conducting negotiations for the sale of said property to 

others at a higher price; that Sawyer wrongfully sold the 61 

claims to Tenneco for a sum of $244,000 when by its conduct 

it had already effected a sale to Joyce for $100,000; that 

Joyce did not discover the purported sale to Tenneco until 

the check was returned to him after July 26, 1977. 

Sawyer contends that the District Court should not have 

considered estoppel against it (1) because Joyce did not 

affirmatively plead estoppel and (2) the evidence for estcppel 

against Sawyer is insufficient. 

Estoppel is an affirmative defense which must be specially 

alleged in the pleadings. Rule 8(c), I4.R.Civ.P. This Court 

has always held, however, that where there has been no 

opportunity to allege estoppel, it may be put in evidence 

with the same effect as if alleged. Scott v. Prescott 

(1924), 69 Mont. 540, 556, 223 P. 490, 495; Colwell v. Grandin 

Inv. Co. (1922), 64 Mont. 518, 527, 210 P. 765, 767. If 

the evidence of estoppel is admitted without objection, 

pleading is not necessary. Middle States Oil Corporation v. 

Tanner-Jones Drill. Co. (1925), 73 Mont. 180, 183, 235 P. 

770, 771. Because of the nature of the pleadings in this 

case, Joyce was not given an opportunity to allege estoppel 

as an affirmative defense. Sawyer filed an ordinary quiet 
title complaint, which required all defendants to appear and 

set forth their claims as to the property involved. Joyce 

appeared by way of general denial to Sawyer's complaint and 

set forth four counts in crossclaim including a claim that 

Joyce had exercised the right to purchase the property from 

Sawyer but Sawyer refused to honor his right. Sawyer filed 

a reply to the crossclaim by way of general denial. Under 

Rule 7, M.R.Civ.P., Joyce was permitted no other pleading. 

In the pleadings of the cause, Joyce's stance was much like 

that of a plaintiff, asserting his claims to the property as 

against Sawyer, but without a right of reply. He therefore 

had no opportunity to plead estoppel as an affirmative 

defense. Under our case law Joyce is entitled to give 

evidence in support of estoppel. 

Do the facts relied upon in the District Court constitute estoppel? In State ex rel. Howeth v. D. A. Davidson 

& Co. (1973), 163 Mont. 355, 367, 517 P.2d 722, 728-29, we set 

forth elements to be considered in determining estoppel. We 

find in this case, Sawyer repudiating its March 8, 1976 

letter of intent, executed by it with the authority of its 

board of directors without notifying Joyce directly or 

immediately; Joyce relying on the letter of intent of March 

8, 1976; and Granger tendering a check to Sawyer for $1,500 

in payment on Joyce's part for that letter of intent. 

Joyce, after the secret repudiation by Sawyer's board of 

directors, executed an agreement in accordance with the 

letter of intent which was apparently refused by Sawyer 

because it had a better offer. Because of these acts of 

Sawyer, Joyce stood to lose the benefit of his bargain. 
We do not rely on estoppel in deciding this case. We 

find a situation where Sawyer had left open a continuing 

offer to sell the mining claims to Joyce under the March 8, 

1976 letter of intent which Joyce accepted before Sawyer 

revoked it properly. Joyce is entitled to the bargain 

struck between him and Sawyer and to any increased benefit 

thereof that thereafter developed. 

The final issue raised by Sawyer with respect to the 

judgment entered by the District Court is that it erred in 

awarding damages for breach of contract in the absence of 

pleadings or proof. 

The District Court, as we have said, ordered specific 

performance by Sawyer of the contract with Joyce for the 

sale of the unpatented lode mining claims, or in the alternative, 

gave Joyce a judgment against Sawyer for $144,000, with 

interest from March 20, 1976. 

In his amended answer and crossclaim to Sawyer's action 

for quiet title, Joyce prayed that the court order Sawyer to 

execute and deliver to him a deed for the mining properties 

upon the payment by Joyce of any sums found due and owing to 

Sawyer. 

In finding and concluding that Joyce was entitled to 

specific performance, the court entered a judgment accordingly. 

However, the court further decreed if Sawyer did not or 

could not perform, then it should pay Joyce $144,000, with 

interest from March 20, 1976. 

The sum of $144,000 is obviously the difference between 

what Joyce agreed to pay Sawyer for the property, $100,000, 

and the price Tenneco is apparently willing to pay or has 

paid Sawyer for the property, $244,000. The March 20, 1976 

date comes from the date of the $1,500 check that was delivered 
to Sawyer on behalf of Joyce as partial payment under the 

letter of intent of March 8, 1976. 

The court's award of $144,000 to Joyce is not damages 

in the true sense, because Sawyer can avoid that damage 

figure by conveying to Joyce the mining claims, subject to 

the payments required by Joyce under the contract between 

them. In so providing in its order, the District Court, 

sitting as a court of equity, has merely fashioned a way to 

make effective its decree of specific performance. The 

District Court has acted in the interests of judicial economy 

in case of nonperformance by Sawyer under the d~cree. 

When a District Court sits as a court of equity, it is 

empowered to determine the questions involved in the case 

and to do complete justice. Hames v. City of Polson (1949), 

123 Mont. 469, 477, 215 P.2d 949, 955; Link v. State by & 

through Dept. of Fish & Game (1979), 180 Mont. 469, 482, 591 

P.2d 214, 222. Sawyer's fourth contention against the 

specific performance decree therefore is without merit. 

The Grouse Claims 

The problem with the Grouse claims is another phase of 

the case before the District Court on which the ruling was 

in favor of Joyce, and from which Sawyer appeals. 

A part of the 64 contiguous unpatented mining claims to 

which Sawyer sought quiet title were those four claims 

described as Ragand 8, 9, 10 and 11. 

In July 1965, Bill Anglin, the owner of a group of 

mining claims adjoining the Sawyer claims group, but across 

the Idaho border, checked at the office of the clerk and 

recorder in the Beaverhead County courthouse and discovered 

that no affidavit of performance of annual assessment work 

had been filed for the Sawyer claims group for the assessment 
year ending September 1, 1974. Anglin entered the land 

covered by the Ragand 8-11 claims and on July 16, 1975, 

"overstaked" much of the ground covered by the Ragand claims 

with the Grouse I, I1 and I11 claims (hereafter Grouse 

claims). Anglin filed certificates of location for the Grouse 

claims in the office of the county clerk and recorder and each 

year thereafter filed affidavits of annual representation in 

that office to show that his assessment work for the Grouse 

claims was being performed. 

Sawyer was apparently unaware of the staking, location, 

and filings relating to the Grouse claims, and its president 

testified that the assessment work was done on all of the 64 

Sawyer group claims each year, but that it had omitted to 

file annual affidavits of representation in the office of 

the county clerk and recorder. 

In August 1978, Joyce purchased the Grouse claims from 

Anglin. In his amended answer and crossclaim to Sawyer's 

quiet title complaint, Joyce claimed title to the Grouse 

claims by virtue of the transfer from Anglin, and his assessment work and filing of the necessary affidavits of representation 

thereafter. 

Sawyer's evidence at trial was that although the annual 

affidavits of representation had not been filed by Sawyer, 

it nevertheless had done the assessment work on the claims 

by expending the required amounts of assessment work on a 

group basis. Joyce produced two witnesses who stated they 

had viewed the properties in question in several of the 

years involved, and saw no evidence of assessment work 

having been done on the mining claims. It is not clear from 

the record that the two witnesses visited all of the 64 

claims in question. 
The District Court determined and found that Sawyer had 

failed to do its annual assessment work on the claims for 

1963 and 1964 and had not filed the required annual affidavits 

of representation. During trial, Sawyer took the position 

that under the law, even if it had failed to file the annual 

affidavits of representation, it could nevertheless maintain 

its title to the mining claims if in fact the annual assessment 

work was done by him. The District Court found as a fact 

that the annual assessment work had not been done on any of 

the claims and that the Ragand claims were open for location 

and filing as Grouse claims by Anglin. 

Sawyer's issues with respect to the Grouse claims are: 

1. The finding that the annual assessment work was not 

performed for the work year ending September 1, 1964 is 

clearly erroneous; 

2. The District Court erred in determining the legal 

effect of Sawyer's failure to file an affidavit of annual 

representation; 

3. Work resumed on the Sawyer claims group in 1965, 

prior to the time that Anglin located the conflicting Grouse 

claims; 

4. The District Court erred in concluding that the 

Ragand claims had been abandoned by Sawyer; 

5. Any doubt as to the validity of the overlapping 

Grouse claims should be resolved in favor of Sawyer because 

of the "bad faith" of Anglin. 

Almost the whole of the District Court's determination 

that Joyce was the valid owner of the Grouse claims rests 

on the District Court's finding that Sawyer had failed to do 

its annual assessment work for the years involved. On the 
one hand the District Court had the testimony of the officials 

of Sawyer that the assessment work had in fact been done, 

that it had arranged with a contractor or workman to do 

trenching in 1964 and 1965, and had otherwise done or caused 

to be done the assessment work in each annual segment required. 

On the other hand, the District Court had the testimony of 

Anglin that no work had been done in the year 1964, or in 

1965; the testimony of two witnesses who saw no work being 

done on the mining claims by Sawyer; no substantiating 

testimony of workmen or contractors was produced by Sawyer 

to uphold the testimony of Sawyer's officers; and the inescapable 

fact that Sawyer had not filed any annual affidavits of 

representation. The great weight of the testimony favors 

the District Court's determination. There is no need to 

cite a long string of cases, all available in our annals, 

that on appellate review, the finding of a District Court 

will be sustained where it is not clearly erroneous, and 

where substantial credible evidence supports the findings of 

the District Court. 

That finding alone, that Sawyer had failed to do any 

assessment work on the claims for the period here involved, 

without more, is sufficient to overcome all of Sawyer's fact 

issues. The court's finding precludes any argument that 

Sawyer had resumed its assessment v~ork in 1975 before Anglin 

made his Grouse locations, sustains the District Court's 

determination that the Ragand claims had been abandoned by 

Sawyer and makes irrelevant Sawyer's claim that the failure 

to file affidavits of annual representation has no legal 

adverse effect on Sawyer, if it actually did the assessment 

work. 
However, the basis of Sawyer's claim,that failure to file 

the annual representation affidavits did not adversely 

affect Sawyer's title, should be explained. 

Former section 50-704, R.C.M. 1947, provided that the 

owner of a lode or placer mining claim who performed the 

annual assessment work could file in the office of the 

county clerk and recorder where the claim was situated an 

affidavit showing the nature and character of the work that 

had been done on the mining claim. Section 50-704 further 

provided that "such affidavits . . . are prima-facie evidence 

of the facts therein stated." 

Thus, under former section 50-704, R.C.M. 1947, this 

Court had decided that an affidavit of annual representation 

is prima facie evidence that assessment work has been done, 

but that oral evidence could be given to prove that the work 

had been done without regard to the affidavit. Davidson v. 

Bordeaux (1895), 15 Mont 245, 250, 38 P. 1075, 1076. We held 

that the statute was merely a means of preserving prima 

facie evidence that the assessment work requirement had 

been fulfilled. Coleman v. Curtis (1892), 12 Mont. 301, 

305, 30 P. 266, 267. 

Section 50-704, R.C.M. 1947, was amended by the legislature 

in 1971, and is now carried forward as section 82-2-103, 

MCA. The effect of the 1971 amendment is that whereas 

under section 50-704, the filing of an annual affidavit was 

permissive ("may") it is now under section 82-2-103, MCA, 

mandatory ("must"). In addition, the clause we have cited 

above has been changed to recite that "[Tlhe failure to file 

such affidavits within the period allowed therefor shall be 

prima facie evidence that such labor has not been performed 

and that the owner of the claim or claims has abandoned and 

surrendered same." 
Sawyer claims that the District Court applied the 

mandatory provision of section 82-2-103, MCA, to this claim 

when in fact the assessment work involved was performed at a 

time when the statute was permissive, in 1964 and 1965. 

Sawyer therefore claims that the court applied the wrong 

legal test with respect to the effect of failure to file 

annual affidavits of representation. 

As we have indicated, the issue is one that we need not 

reach. The District Court determined that no assessment 

work had been done by Sawyer. Under that finding, it makes 

no difference whether we apply the provisions of the statute 

on recording of annual affidavits before or after its amendment in 1971. Since no annual assessment work was done by 

Sawyer, the statute does not come into play and is irrelevant. 

Sawyer's final contention is that Anglin, in making the 

Grouse location, was guilty of bad faith and for that reason 

the prior rights of Sawyer should be recognized. 

The gist of Sawyer's claim on this contention is that 

work had taken place on the Sawyer claims prior to July 

15, 1965 and each year thereafter. One of Joyce's witnesses, 

Granger, admitted seeing machines including a bulldozer on 

the properties during either 1965 or 1966, and acknowledged 

that work had been done on the "shear zone", a part of the 

claims. Sawyer's contention is that under mining law, even 

though claims may be subject to forfeiture by failure to 

perform assessment work, the original locator can subsequently 

re-enter the claims, and as long as he is actively performing 

work he will defeat the rights of any subsequent junior 

locator. Sawyer further contends that Anglin observed the 

activities of Sawyer for a period of three years until he 

discovered that an affidavit and assessment work had not 
been filed, and then he quickly moved in and "jumped" the 

Ragand claims. 

It is true that in Columbia Standard Corp. v. Ranchers 

Explor. & Dev., Inc. (10th Cir. 1972), 468 F.2d 547, it was 

held that a junior locator who had entered and overstaked 

prior claims without making inquiry of knowledgeable persons 

or examining the senior locator's claims individually to see 

if location requirements had been satisfied could not maintain 

the junior mining claims because of his bad faith. We do 

not have such a case here. Again the determination of the 

District Court that the assessment work had not been done is 

conclusive against this contention. 

Other Issues 

With respect to the whole case, Sawyer also raises 

additional issues contending that the court should have 

applied the doctrines of estoppel and laches against Joyce, 

particularly relating to his claim of contract for the 

purchase of the 64 unpatented mining lode claims. Those 

issues, however, do not reach the principle issues in this 

case and are inconsequential. The court's decision in 

favor of Joyce appears to us to be soundly based. We see 

no basis for estoppel against Joyce, nor any ground to determine he was guilty of laches. 

Accordingly, the judgment of the District Court is 

af firmed. 

-~.%_ Justice 
We Concur: