Court Opinion

ID: 885784
Source: CourtListenerOpinion
Date Created: 2013-06-05 03:42:18.836422+00
Date Added: 2024-06-11T15:11:47.198761
License: Public Domain

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                                                              No. 00-339

                   IN THE SUPREME COURT OF THE STATE OF MONTANA

                                                           2001 MT 125N

                                                   MARY HILLABRAND,

                                                   Plaintiff and Respondent,

                                                                      v.

                                        McDOUGAL BOTANICAL TRUST,

                                    M. MARGARET NIGRELLE, TRUSTEE,

                                                  Defendant and Appellant.

                  APPEAL FROM: District Court of the Twentieth Judicial District,

                                               In and for the County of Lake,

                                  The Honorable C. B. McNeil, Judge presiding.

                                                  COUNSEL OF RECORD:

                                                           For Appellant:

           Edward A. Murphy, Datsopoulos, MacDonald & Lind, Missoula, Montana

                                                          For Respondent:

               John A. Mercer, French, Mercer, Grainey & O'Neill, Polson, Montana

                                       Submitted on Briefs: September 7, 2000
                                               Decided: July 23, 2001

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                                                                   Filed:

                              __________________________________________

                                                                    Clerk

Justice James C. Nelson delivered the Opinion of the Court.

¶1 Pursuant to Section I, Paragraph 3(c), Montana Supreme Court 1996 Internal Operating
Rules, the following decision shall not be cited as precedent but shall be filed as a public
document with the Clerk of the Supreme Court and shall be reported by case title,
Supreme Court cause number and result to the State Reporter Publishing Company and to
West Group in the quarterly table of noncitable cases issued by this Court.

¶2 Mary Hillabrand brought this action in the Twentieth Judicial District Court, Lake
County, for specific performance of a buy/sell agreement she entered into with the
McDougal Botanical Trust (the Trust) regarding a parcel of real property. The District
Court granted summary judgment in Hillabrand's favor and the Trust appeals. We affirm.

¶3 The Trust raises the following issue on appeal:

¶4 Whether the District Court erred in determining that the buy/sell agreement is a
valid enforceable contract and that performance is not excused by law or the
language of the contract.

                                         Factual and Procedural Background

¶5 The Trust was established in the state of Texas by the Frank and Margaret Nigrelle
family. On July 10, 1998, Frank Nigrelle and three of his friends met Stephani Bradshaw,
a real estate agent, at the Ninepipe Lodge near St. Ignatius for the purpose of viewing a
parcel of land known as the Ramshead Ranch. The ranch, located in Lake County, was
owned by Hillabrand. Hillabrand's real estate agent, John Thuma, accompanied the group
to the ranch.

¶6 The house on the ranch was occupied at that time by Dr. Michael Brownstein,

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Hillabrand's estranged husband. Brownstein was already displeased over the proposed sale
of the property and the party's arrival at the ranch 15 minutes past their appointed time
angered him even more. Brownstein told the group that he was going to litigate over the
property, that he would file a lis pendens, and that the property would not be saleable.
Before leaving, Thuma pointed out to Bradshaw that there was a shotgun near the front
door of the residence.

¶7 Because of the confrontation with Brownstein, Frank decided not to submit an offer for
the ranch. However, several weeks after their visit to the ranch, Thuma sent Bradshaw a
copy of an August 8, 1998 letter from Brownstein's attorney indicating that the issues
preventing a sale had been resolved. The letter stated that Hillabrand and Brownstein had
reached an agreement regarding their marital property, including the Ramshead Ranch,
and that a Consent to Entry of a Final Decree of Dissolution had been given. The letter
further stated that the lis pendens would be removed from the property.

¶8 After these assurances, Frank had the property surveyed and submitted an offer on
behalf of the Trust in October 1998. Hillabrand did not accept the offer, however, because
it was too low. Thereafter, Hillabrand received a competing offer from another party and
no further action involving the Trust occurred until the following spring.

¶9 In March 1999, Thuma called Bradshaw to advise her that the competing offer was not
going to result in a sale. Thuma indicated that Hillabrand would probably accept
$1,000,000 with no contingencies. With that in mind, Bradshaw arranged to have the
property inspected before submitting an offer.

¶10 On the day scheduled for the inspections, Brownstein called Thuma in a rage and
declared that no inspections would be allowed. When Thuma informed Bradshaw of the
call, Bradshaw explained that the property had to be inspected before any offer would be
made. Eventually, Brownstein relented and allowed only the pest inspector on the
property, but insisted that he not enter the house. That inspection occurred without
incident.

¶11 Later that day, Thuma phoned Bradshaw again and informed her that Brownstein
would allow the inspections of the plumbing, electricity and the like to take place the
following day. Thuma also told her that Hillabrand's brother-in-law, Steve, would be at the
ranch to make sure there were no further problems. With these assurances, Bradshaw
made arrangements for the remaining inspections. The following day, when Bradshaw and

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the contractors who were to perform the inspections arrived at the ranch, Steve met them
and told them they could not go into the house as Brownstein was talking to his attorney.
Brownstein was angry because Hillabrand had moved some furniture out of the house.
Bradshaw later testified in her deposition that although she was standing outside the
house, she could hear Brownstein inside screaming and yelling at someone.

¶12 Even though they could not enter the house, the contractors were able to complete
their inspections because the house has an underground area that holds much of the
equipment they needed to inspect and that underground area is accessible from the outside.
However, before they were quite finished, Brownstein came out of the house and yelled at
Bradshaw that the house was not going to sell and he would do something about it. When
Brownstein began screaming obscenities, everyone left.

¶13 A short time after Bradshaw returned to her office, she received a call from
Brownstein accusing one of the inspectors of sneaking into the house and stealing one of
his handguns. Brownstein told Bradshaw that he had called the police and that he intended
to hold her responsible. Sometime later that day, Brownstein left a message with someone
in Bradshaw's office that he had found the gun.

¶14 Bradshaw called the Nigrelles to inform them of Brownstein's behavior during and
after the inspections. Although the Nigrelles were concerned, they nevertheless executed a
buy/sell agreement for the ranch on behalf of the Trust on March 31, 1999.

¶15 On April 20, 1999, the Nigrelles and Bradshaw went to the ranch to look things over
and decide what remodeling they wanted done to the house. With them were an architect
and a contractor, both from Missoula, and Hillabrand's brother-in-law, Steve. Upon
entering the house, they found it in a shambles. There was a gunshot hole through one of
the bedroom windows. There were broken pieces of statuary and ceramics scattered about
the house. A large antler chandelier had been broken. The fireplace hood was scorched
and the paint on the hood had begun to bubble from the heat. There were large stains on
the carpeting and dents in the walls.

¶16 According to Bradshaw, when Steve informed the group that Brownstein planned to
move into a mobile home that was located on an adjacent piece of property at the base of
the driveway to the residence, Margaret Nigrelle's face turned white. Margaret became
very distraught and talked about putting in a complete burglar alarm system, a special
electric gate for protection, and a surveillance system.

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¶17 The following week, Margaret faxed a letter to Bradshaw who in turn faxed it to
Thuma. The letter, dated April 28, 1999, stated that the Trust would not close on the
contract on May 28, 1999, as originally intended unless Hillabrand could demonstrate that
Brownstein would not be residing on the adjacent property. Two weeks later, Bradshaw
received another letter from Margaret, dated May 14, 1999, in which Margaret indicated
that had she known prior to signing the buy/sell agreement that Brownstein intended to
live on the adjacent property, she would not have signed the agreement. Consequently,
Margaret indicated that she considered the agreement null and void and requested the
return of the Trust's earnest money.

¶18 On May 26, 1999, Thuma forwarded a letter to Bradshaw regarding Brownstein. The
letter was written by Brownstein's attorney and addressed to Hillabrand's attorney. The
letter indicated that Brownstein no longer intended to live on the property adjacent to the
ranch. Nevertheless, the Nigrelles refused to close on the ranch.

¶19 On July 6, 1999, Hillabrand brought this action for specific performance of the buy/
sell agreement or, in the alternative, damages. The Nigrelles filed a counterclaim for the
return of the earnest money paid to Hillabrand's real estate agent contending that the
agreement had been rescinded. The Nigrelles later testified in their depositions that they
rescinded the agreement because they feared for their safety and the safety of their
property. They further testified that Hillabrand was responsible in part for the situation
because she created an atmosphere of risk and peril by allowing Brownstein to remain on
the property and threaten people.

¶20 Hillabrand moved for summary judgment on February 15, 2000. Following a hearing
on the motion, the District Court entered its order wherein the court determined that the
buy/sell agreement is a valid and enforceable contract and that the Trust breached that
contract when it failed to complete the purchase because no provision of law or of the
contract excused performance. Thus, the court granted Hillabrand's motion for summary
judgment and ordered specific performance on the agreement.

¶21 The District Court further ordered that within 30 days of the entry of judgment, the
Trust deliver to the title company the balance of the purchase price under the contract,
together with the closing costs, less the earnest money already deposited, and that
Hillabrand deliver to the title company a warranty deed transferring merchantable title for
the property to the Trust. The court also awarded Hillabrand her reasonable costs and
attorney fees. The Trust appeals the District Court's Order Granting Plaintiff's Motion for

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Summary Judgment.

                                                       Standard of Review

¶22 Our standard of review in appeals from summary judgment rulings is de novo. Oliver
v. Stimson Lumber Co., 1999 MT 328, ¶ 21, 297 Mont. 336, ¶ 21, 993 P.2d 11, ¶ 21 (citing
Motarie v. N. Mont. Joint Refuse Disposal (1995), 274 Mont. 239, 242, 907 P.2d 154, 156;
Mead v. M.S.B., Inc. (1994), 264 Mont. 465, 470, 872 P.2d 782, 785). When we review a
district court's grant of summary judgment, we apply the same evaluation as the district
court based on Rule 56, M.R.Civ.P. Oliver, ¶ 21 (citing Bruner v. Yellowstone County
(1995), 272 Mont. 261, 264, 900 P.2d 901, 903). We set forth our inquiry in Bruner as
follows:

        The movant must demonstrate that no genuine issues of material fact exist. Once
        this has been accomplished, the burden then shifts to the non-moving party to prove,
        by more than mere denial and speculation, that a genuine issue does exist. Having
        determined that genuine issues of fact do not exist, the court must then determine
        whether the moving party is entitled to judgment as a matter of law. We review the
        legal determinations made by a district court as to whether the court erred.

Oliver, ¶ 21 (quoting Bruner, 272 Mont. at 264-65, 900 P.2d at 903). "Summary judgment
is an extreme remedy which should never be substituted for a trial if a material factual
controversy exists." Montana Metal Buildings., Inc. v. Shapiro (1997), 283 Mont. 471,
474, 942 P.2d 694, 696 (citing Clark v. Eagle Systems, Inc. (1996), 279 Mont. 279, 283,
927 P.2d 995, 997).

¶23 Moreover, in a summary judgment proceeding, the evidence must be viewed in the
light most favorable to the nonmoving party, and all reasonable inferences will be drawn
therefrom in favor of the party opposing summary judgment. Oliver, ¶ 22 (citing Joyce v.
Garnaas, 1999 MT 170, ¶ 8, 295 Mont. 198, ¶ 8, 983 P.2d 369, ¶ 8). Consequently, we
will view the evidence in the light most favorable to the Trust and all reasonable
inferences will be drawn in favor of the Trust.

                                                               Discussion

¶24 Whether the District Court erred in determining that the buy/sell agreement is a valid
enforceable contract and that performance is not excused by law or the language of the

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contract.

¶25 Margaret, as Trustee, argues on behalf of the Trust, that the District Court erred in
determining that the buy/sell agreement is a valid and enforceable contract and that no
provision of that contract excuses performance. Margaret contends that a purchaser under
a buy/sell agreement can rescind the agreement if there are breaches by the seller that
defeat the essential purpose of the contract. In this case, Margaret argues that one of the
essential purposes of the contract is to obtain the quiet and peaceful enjoyment of the
property. She maintains that this could not be accomplished here because Brownstein, who
had repeatedly exhibited threatening and intimidating behavior over the sale of the
property, planned to move into a trailer on the adjacent property.

¶26 Margaret also argues that damage to the property by Brownstein made the buy/sell
agreement voidable under the express terms of the contract. Thus, Margaret contends that
there are issues of material fact--whether Hillabrand acted reasonably and whether the
intimidation defeated the essential purpose of the agreement--preventing disposition of
this case on a motion for summary judgment.

¶27 Hillabrand argues on the other hand, that the threat that a seller's estranged husband
will move in next door to the subject property is not a legal basis upon which a real estate
buy/sell agreement can be rescinded by the buyer particularly where the buyer, for over
one year prior to executing the agreement, knew of the estranged husband's threatening
and confrontational behavior and where the buyer, prior to the date set for closing, was
provided with documentation that the estranged husband would not, in fact, live next door.
Moreover, Hillabrand submits that Margaret offered no legal authority for the proposition
that a real estate purchase agreement may be rescinded because of an undesirable neighbor.

¶28 In addition, Hillabrand maintains that the damage to the property by Brownstein was
minor, easily repairable, and insignificant because the Trust planned to do "major
remodeling" anyway. Hillabrand argues that the insignificance of the damage is evidenced
by Margaret's May 14, 1999 letter seeking to cancel the transaction wherein Margaret
makes no reference to any physical damage to the property. Finally, Hillabrand contends
that even if the buy/sell agreement was breached as a result of Brownstein's threats or by
the minor damage to the property, such breach does not, as a matter of law, justify
rescission.

¶29 Hillabrand's arguments are well taken. This Court has previously held that

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        [a] breach which goes to only part of the consideration, is incidental and subordinate
        to the main purpose of the contract, and may be compensated in damages does not
        warrant a rescission of the contract; the injured party is still bound to perform his
        part of the agreement, and his only remedy for the breach consists of the damages he
        has suffered therefrom.

Halcro v. Moon (1987), 226 Mont. 121, 125, 733 P.2d 1305, 1307 (quoting Johnson v.
Meiers (1946), 118 Mont. 258, 263, 164 P.2d 1012, 1014). Furthermore, § 28-2-1711,
MCA, provides:

        When party may rescind. A party to a contract may rescind the same in the
        following cases only:

        (1) if the consent of the party rescinding or of any party jointly contracting with him
        was given by mistake or obtained through duress, menace, fraud, or undue influence
        exercised by or with the connivance of the party as to whom he rescinds or of any
        other party to the contract jointly interested with such party;

        (2) if, through the fault of the party as to whom he rescinds, the consideration for his
        obligation fails in whole or in part;

        (3) if such consideration becomes entirely void from any cause;

        (4) if such consideration, before it is rendered to him, fails in a material respect from
        any cause; or

        (5) if all the other parties consent.

None of the provisions of this statute apply in this case.

¶30 In addition, the buy/sell agreement contains the following language:

        RISK OF LOSS: Prior to closing of this sale, all risk of loss shall remain with the
        Seller, in addition, should the property be materially damaged by fire or other cause
        prior to closing, this agreement shall be voidable at the option of the Buyer.

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Margaret incorrectly argues that under this provision, the agreement is voidable because of
the damage done to the property by Brownstein. However, Margaret has not demonstrated,
nor can she, that the property was "materially damaged." Contrary to her contentions, the
proper remedy is not rescission of the contract, but rather, compensation for the damage.

¶31 In addition, Margaret cites no authority for her contention that an agreement may be
rescinded because of an undesirable neighbor. Moreover, Margaret executed the buy/sell
agreement on behalf of the Trust even though Brownstein had demonstrated threatening
and confrontational behavior for over a year prior to the date the agreement was executed.

¶32 Margaret relies on Compton v. Alcorn (1976), 171 Mont. 230, 557 P.2d 292, for the
proposition that if a breach defeats the purpose of the contract, then rescission of the buy/
sell agreement is warranted. However, Margaret's reliance on Compton is misplaced
because Compton dealt with actual safety defects in a mobile home, not minor vandalism
and the unrealized threat that the seller's estranged husband was moving in next door. We
held in Compton that the partial breach in that case was "so substantial and fundamental as
to defeat the object of the parties in making the agreement." Compton, 171 Mont. at 235,
557 P.2d at 295. That is not the case here.

¶33 Margaret also relies on Ogg v. Herman (1924), 71 Mont. 10, 15-16, 227 P. 476, 477,
for the proposition that Hillabrand had the obligation to provide marketable and
merchantable title of such character as assures to the purchaser the quiet and peaceable
enjoyment of the property. Once again Margaret's reliance is misplaced. Ogg dealt with
title defects of record consisting of a restrictive building covenant that would prevent the
buyer from using the property to carry on various business activities. No such title defects
exist in the case sub judice.

¶34 Moreover, in Kasala v. Kalispell Pee Wee Baseball League (1968), 151 Mont. 109,
115, 439 P.2d 65, 69, we stated that "even an intentional interference with the use and
enjoyment of land is not actionable unless the interference be both substantial and
unreasonable." Here, a mere threat to move in next door, a threat that was proven to be
without foundation, cannot be the basis for rescinding the buy/sell agreement.

¶35 Accordingly, we hold that the District Court did not err in determining that the buy/
sell agreement is a valid enforceable contract and that performance is not excused by law
or the language of the contract.

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¶36 Affirmed.

                                                    /S/ JAMES C. NELSON

                                                              We Concur:

                                                     /S/ KARLA M. GRAY

                                                /S/ TERRY N. TRIEWEILER

                                               /S/ W. WILLIAM LEAPHART

                                                         /S/ JIM REGNIER

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