Title: ENGEBRETSON v PUTNAM
Citation: N/A
Docket Number: 13679
State: Montana
Issuer: Montana Supreme Court
Date: November 3, 1977

No. 13679 IN THE SUPREME COURT OF THE STATE OF MONTANA 1977 GERALDINE T. ENGEBRETSON, Plaintiff and Respondent, BRYCE C. PUTNAM and BETTE J. PUTNAM, Defendants, Counter-claimants and Appellant. Appeal from: District Court of the Fourth Judicial District, Honorable E . Gardner Brownlee, Judge presiding. Counsel of Record: For Appellant: Boone, Karlberg and Haddon, Missoula, Montana Sam E. Haddon argued, Missoula, Montana For Respondent : Skelton and Knight, Missoula, Montana Robert Skelton argued, Missoula, Montana Submitted: September 29, 1977 Decided: WGV - 4 1977 ' , ? -- U Filed: I V C , - , , M r . Justice Frank I. Haswell delivered the Opinion of the Court. Defendants appeal from a summary judgment granted t o plaintiff by the District Court, Missoula County, in her s u i t on a promissory note. Plaintiff Geraldine T. Engebretson was the owner of certain real property located i n Missoula County, Montana. O n October 29, 1970, she listed t h i s property for sale with Trail Realty owned by defendants Bryce C. and Bette J. Putnam. Defendants prepared a listing agreement for the property using a standard form l i s t i n g contract which plaintiff signed. Defendants l a t e r decided to purchase plaintiff' s property for themselves. On January 18, 1971, defendant Bryce C, Putnam executed a promissory note i n part payment, payable t o Geraldine T. Engebretson for $3,000 a t 8 percent interest due in one year. Plaintiff signed a warranty deed whereby she did "grant, bargain, s e l l and convey" her property to the Putnams. B y the same deed Engebretson convenanted that she would: "* * * forever WARRANT and DEFEND a l l right, t i t l e and interest in and t o the said premises and the quiet and peaceable possession thereof unto the [Putnams] * * * against a l l acts and deeds of [Enge- bretson] and a l l and every person and persons whom- soever lawfully claiming or to claim the same," [Bracketed material paraphrased.] The warranty deed stated Engebretson's grant was subject to a f i r s t mortgage in favor of the Missoula F i r s t Federal Building & Loan Association, which mortgage the Putnams agreed to assume and pay according t o its terms. A t the time Engebretson sold her property to the Putnams, it was subject to the liens of Special Improvement District No. 296 for engineering fees and Special Improvement District No. 304 for sewer. Prior t o the execution of the warranty deed, plaintiff had paid a l l matured special improvement d i s t r i c t installsreats, however $1,244 i n unmatured installments remained to be paid. The l i s t i n g agreement which defendants prepared for plaintiff indicated \ the property was subject to an annual special improvement d i s t r i c t payment of $21.50 for sewer installation. The warranty deed made no provision for the assumption of or proration of the unmatured payments by either party. Defendants l a t e r paid the $1,244 t o release the special improvement d i s t r i c t liens from the property. A s compensation for paying these installments, Putnams claimed a setoff against the amount owing on the $3,000 promis- sory note Bryce Putnam signed. Consequently, when the note matured on January 18, 1972, Putnams did not make any payment toward the amount due. In M a y 1972, they offered to pay Engebret- son an amount less than the $3,000 plus interest then due. She refused t o accept the lesser amount. On June 2, 1972, Engebretson filed a complaint against Bryce Putnam alleging Putnam executed the promissory note; that he failed t o pay the note upon maturity; and that the note provided for a reasonable attorney fee i n case of s u i t to recover it. She prayed for judgment for $3,000, interest and a reasonable attorney fee. Putnam filed an answer admitting the existence of the note and that he had made no payment on it, but alleging, as a defense, that the amount due on the note was subject t o a setoff for the special improvement d i s t r i c t installments he had paid. H e counterclaimed for a setoff of $1,244 and for a reasonable attorney fee. H e also moved to join h i s wife as a defendant and counter- claimant in the action. Plaintiff filed a reply t o defendants' counterclaim alleging,, among other things, that Bryce Putnam was a real estate broker; that she had listed her real property with him for sale; that a t the time plaintiff listed her real property with the defendants and a t the time she sold the property t o them, they knew of the unnsatured special improvement d i s t r i c t installments previonaiy assessed on the property. Each side moved for summary judgment. O n the basis of the pleadings, the exhibits thereto, and the memoranda of law submitted by the parties, the District Court granted summary judgment in plaintiff's favor and awarded her $1,450 i n attorney fees. De- f endant s appealed. Three issues developed on appeal: 1. Did the District Court e r r i n granting summary judgment? 2. Did the District Court e r r in denying defendants' counterclaim? 3. Did the District Court e r r i n awarding plaintiff attorney fees in the amount of $1,450. The purpose of the summary judgment procedure is to encourage judicial economy through the elimination of unnecessary t r i a l , Mont . delay and expense. Bonawitz v. Bourke, , 567 P.2d 32, 33, 34 St.Rep. 638, 640 (1977); Guthrie v. Dept. of Social & M o n t . Rehabilitative Services, , 563 P.2d 555, St.Rep. 255, 257 (1977). Summary judgment i s not a substitute for t r i a l , however, and is inappropriate when genuine issues of material fact remain t o be litigated. Rule 56(c), M.R.Civ.P. ; Duncan v. Rockwell Manufacturing Co., Mont . - , 567 P.2d 936, 938, 34 St.Rep. 821, 823 (1977). Additionally, whether a court should grant a motion for summary judgment or require a t r i a l rests in the sound discretion of the court even though the movant may have made out a case for summary judgment. 6 Pt. 2 Moore's Federal Practice 156.15[6] ; John Blair & Co. v. Walton, 47 F.R.D. 196 (1969). I f there is any doubt as to the propriety of a motion for summary judgment, the court should deny it. Fulton v. Clark, 167 Mont. 399, 403, 538 P.2d 1371, 1373 (1975); Kober & Kyriss v. Billings Deaconess Hospital, 148 Mont. 117, 122, 123, 417 P.2d 476, 479 (1966). During oral argument on appeal, certain facts were brought to light making it apparent that genuine issues of material fact remained t o be litigated. Summarizing from the pleadings and oral argument, p l a i n t i f f ' s allegations are: (a) that plaintiff listed her property with the defendant realtors for sale, thus creating a principal/agent relationship between plain- t i f f and defendants a t the time of the listing; (b) that defendants prepared both the l i s t i n g agreement and, a f t e r they decided to purchase the property themselves, the warranty deed; and (c) that a t a l l times defendants knew of the unmatured special improvement d i s t r i c t installments, yet no mention was made of them i n the warranty deed. The pretrial proceedings l e f t undecided such issues as: 1. Did the principaI/agent relationship between plaintiff and defendants s t i l l exist a t the time plaintiff sold her property to defendants? 2. What was the intent of the parties regarding payment of the unmatured special improvement d i s t r i c t installments? 3. Did defendants breach any fiduciary duty they may have owed plaintiff? This Court has previously held that summary judgment is usually inappropriate where the intent of the contracting parties is an important consideration. Fulton v . Clark, supra; Kober & Kyriss v . Billings Deaconess Hospital, supra. Because this and other questions heretofore mentioned remain at issue, we hold summary judgment was improperly granted in this case. Because this case must be remanded, we feel some direction to the District Court on the remaining two issues is appropriate. The first issue in essence is whether unmatured installments of a special improvement district assessment constitute an encum- brance upon the real property upon which they are assessed from the date the special improvement district assessment was levied, or from the date the individual installments of the assessment mature. By statute, a special improvement district assessment "shall constitute a lien upon and against the property upon which such assessment is made and levied" and the assessment attaches as a lien to the property assessed "from and after the date of the passage of the resolution levying such assessment * * * . " Section 11-2229, R . C . M . 1947. The only way in which the lien created by the assessment can be extinguished is by payment of the assessment including all penalties, costs and interest. Section 11-2229, R . C . M . 1947. Clark v . Demers, 78 Mont. 287, 254 P. 162 (1927) and State ex rel. Malott v . Board of Commissioners, 89 Mont. 37, 296 P. 1 ( 1 9 3 1 ) , relied on by plaintiff, do not stand for the proposition that special improvement district assessment installments become liens upon the property assessed only upon maturity of the install- ments. Clark and Malott are distinguishable from the instant case in that they dealt with irrigation district assessments rather than special improvement district assessments. Both kinds of assess- ments are statutorily controlled; thus, one must look to the statutes creating them to determine the time the lien of assess- ment attaches. The statutory provisions regarding special improvement dis- t r i c t s are set out i n sections 11-2201 through 11-2288, R.C.M. 1947. To create a special improvement d i s t r i c t , the c i t y council must f i r s t pass a resolution of intent and give public notice .thereof. After the protest time has elapsed, the council must pass a resolution actually creating the special improvement d i s t r i c t . Section 11-2207, R.C.M. 1947. The council then determines the entire cost of the proposed improvements and establishes a method by thich it shall assess the cost o f - the improvements against the property owners who are subject t o the assessment. Section 11-2214, R.C.M. 1947. B y a separate resolution, the council levies and assesses a tax upon a l l taxable property in the special improvement dis- t r i c t . This resolution contains a description of each l o t and parcel of land with the name of the owner i f known, the amount of each payment to be made, and the date when it becomes delinquent. The assessment may be paid i n equal annual installments spread over a term not exceeding twenty years. Section 11-2222, R.C.M. 1947. The statute under which irrigation d i s t r i c t assessments i n Clark were made, provided that the board of directors of each irrigation d i s t r i c t should make a yearly determination of the t o t a l amount of money needed for that year for the administrative expenses of the district. The board would then levy a proportionate amount of the yearly cost against each landowner i n the d i s t r i c t . The tax thus determined would become a lien upon the land and the lien would attach "as of the f i r s t Monday of March of that year". Laws of Montana 1921, Ch. 153, 522 (repealed 1929). The statutory schemes for special improvement d i s t r i c t s and for irrigation d i s t r i c t s thus differed i n two important ways: (1) the entire cost of the special improvement d i s t r i c t is made i n one determination and assessed accoedingly, whereas the irrigation d i s t r i c t assessment is determined yearly and the amount of the yearly assessment fluctuates according t o the needs of the d i s t r i c t ; and (2) the specific statutory times a t which the ass-nts attach to the property a s liens, i.e., the assessment date of the resolution levying the special improvement d i s t r i c t / versus "the f i r s t ~ & d a ~ of March of [each] year." Section 67-1617, R.C.M. 1947, provides that the term "encumbrances" includes taxes, assessments, and a l l liens upon real property, Therefore, a lien created by a. special improve- ment d i s t r i c t assessment is an encumbrance upon the property which dates from the passage of the resolution creating the assessment. The remaining issue involves what evidence is sufficient to support an award of attorney fees. The promissory note upon which plaintiff sued provided for recovery of a reasonable attorney fee i n case s u i t was brought to recover on the note, The only eddence plaintiff presented t o establish a reasonable attorney fee was a copy of her retainer agreement with her attorney. This was a contingent fee agreement authorizing her attorney to retain one-third of any monies received a s compensa- tion for h i s services. On the basis of this agreement alone, the court awarded plaintiff $1,450 a s a reasonable attorney fee. W e disapprove of an award of attorney fees based on t h i s type of documentation. W e have previously approved guidelines for such an award. Crncevich v. Georgetown Recreation Corp., 168 Mont. 113, 541 P.2d 56 (1975). Those zguidelines, which enumerated the items to be considered in making an award, include: " * * * the amount and character of the services rendered, the labor, time, and trouble involved, the character and importance of the litigation in which the services were rendered, the amount of money or the value of property to be affected, the professional skill and experience called for, the character and standing in the profession of the attorneys. * * * The result secured by the services of the attorneys may be considered as an important element in determining their value . " 168 Mont . 119,120. The retainer agreement between plaintiff and her attorney does not conform to the above requirements. The result of the negotiations between an attorney and his client as to their fee agreement is not controlling in fixing a reasonable attorney fee to assess against the opposing party. Such an award must be determined in accordance with the guidelines enumerated in Crncevich. The cause is reversed and remanded with instructions to proceed in accordance with this Opinion. Justice