Court Opinion

ID: 875572
Source: CourtListenerOpinion
Date Created: 2013-06-04 20:05:29.907847+00
Date Added: 2024-06-11T10:59:45.292679
License: Public Domain

No.     11934

            I N T E SUPREME C U T O THE STATE O M N A A
                 H           OR F              F OTN

                                            1971

DAN DAVIS and D N L DAVIS,
               O AD

                                 P l a i n t i f f and Respondent,

         -vs   -
GEORGE V. DAVIS,

                                 Defendant and Appellant.

Appeal from:           D i s t r i c t Court of t h e Third J u d i c i a l D i s t r i c t ,
                       Honorable Sid G. S t e w a r t , Judge p r e s i d i n g .

Counsel of Record:

        For Appellant :

                   William R. Taylor argued, Deer Lodge, Montana.
                   Hughes, Bennett and Alan F. Cain, Helena, Montana.
                   Alan F. Cain argued, Helena, Montana.

        For Respondent :

                   C. W. Leaphart, Jr. argued, Helena, Montana.

                                                      Submitted:         December 2, 1971

                                                         Decided :      JAN 2 7 1n
                                                                                 9
F i l e d : JAN    2 7 1972
M r . J u s t i c e Gene B. Daly d e l i v e r e d t h e Opinion of t h e C o u r t .

             T h i s c a u s e i n v o l v e s two a c t i o n s c o n s o l i d a t e d f o r t r i a l

 purposes i n t h e d i s t r i c t c o u r t of t h e t h i r d j u d i c i a l d i s t r i c t ,

 Powell County.           The a c t i o n s were b r o u g h t by two b r o t h e r s a g a i n s t

 t h e i r u n c l e f o r b r e a c h o f o r a l c o n t r a c t s t o manage r a n c h p r o p e r -

 ties.      The m a t t e r was t r i e d t o t h e c o u r t s i t t i n g w i t h a j u r y .

From a j u r y v e r d i c t and judgment i n f a v o r o f t h e p l a i n t i f f s ,

t h e defendant appeals.

             The p l a i n t i f f s a r e Dan Davis and Donald Davis.                       The

d e f e n d a n t i s George V. D a v i s , t h e i r u n c l e .        Each p l a i n t i f f ' s

c o m p l a i n t was drawn i n t h r e e c o u n t s .

             Count I a l l e g e d a n o r a l c o n t r a c t r u n n i n g from t h e y e a r

1957 t h r o u g h 1964, whereby p l a i n t i f f s were t o each r e c e i v e a

s a l a r y of $350 p e r month, p l u s f r e e meat, m i l k , u t i l i t i e s , and

h o u s i n g . P l a i n t i f f s were a l s o t o r e c e i v e o n e - t h i r d o f t h e p r o f i t s

o f t h e r a n c h e s and a s a f u r t h e r compensation each p l a i n t i f f was

t o b e d e s i g n a t e d i n a w i l l , t o be e x e c u t e d by d e f e n d a n t , t o

r e c e i v e t h e ranch upon which h e was l i v i n g i n t h e e v e n t of d e f e n -

dant's death.            The r e s p e c t i v e c o m p l a i n t s a l l e g e t h a t t h e f u l l

s h a r e o f p r o f i t s was n o t p a i d t o each p l a i n t i f f .         Dan Davis p r a y s

f o r $71,310 damages and Donald Davis p r a y s f o r $68,653 damages.

             Count I1 a l l e g e s a s i m i l a r o r a l agreement r u n n i n g from

1965 t h r o u g h 1966, under which each p l a i n t i f f was t o r e c e i v e t h e

r e m u n e r a t i o n o u t l i n e d i n Count I, e x c e p t t h a t each p l a i n t i f f was

t o r e c e i v e one-half of t h e p r o f i t s of t h e ranches, l e s s deprecia-

t i o n ; and e a c h was t o h o l d t h e p r o f i t s r e c e i v e d f o r t h e purpose

o f paying i n h e r i t a n c e t a x e s .     P l a i n t i f f s a l l e g e t h a t f o r the years

1965 and 1966, t h e y r e c e i v e d no p r o f i t s . Donald Davis p r a y s f o r

$32,000 damages and Dan Davis p r a y s f o r $38,000 damages.
               Count 111 a l l e g e s i n s u b s t a n c e t h a t by h i s manner and

a c t i o n s d e f e n d a n t prevented p l a i n t i f f s from performing t h e i r

c o n t r a c t s ; t h a t p l a i n t i f f s b e l i e v e d e f e n d a n t has n o t provided f o r

them i n h i s w i l l a s a g r e e d and t h e y pray f o r r e l i e f i n t h e n a t u r e

of s p e c i f i c p e r f o r m a n c e , f o c c i n g d e f e n d a n t t o e x e c u t e a w i l l i n

t h e manner a g r e e d upon.

               By way of answer d e f e n d a n t a d m i t t e d t h a t p l a i n t i f f s were

employed by him f o r t h e y e a r s s t a t e d i n t h e c o m p l a i n t s b u t denied

t h e e x i s t e n c e o f any s u c h agreements a s a l l e g e d i n t h e c o m p l a i n t s .

The bonus payments which were paid t o p l a i n t i f f s by d e f e n d a n t

were a d m i t t e d ;          d e f e n d a n t denied t h e y were paid p u r s u a n t t o

any s e t c o n t r a c t s , b u t were p a i d i n t h e d i s c r e t i o n of d e f e n d a n t .

Defendant f u r t h e r a l l e g e d t h a t p l a i n t i f f s breached t h e terms o f

whatever agreements t h e y c o n s i d e r e d e x i s t e d between d e f e n d a n t

and themselves by demanding $1,000 p e r month s a l a r y and t h r e a t e n -

i n g t o q u i t d e f e n d a n t ' s employ i f he f a i l e d t o a c c e d e t o t h e i r

demands.

               Defendant a d d i t i o n a l l y s e t up t h e d e f e n s e t h a t p l a i n t i f f s '

c l a i m s through t h e y e a r 1961, were b a r r e d by t h e s t a t u t e of

l i m i t a t i o n s , s e c t i o n 93-2604(1), R.C.M.            1947, which p r o v i d e s
II
     An a c t i o n upon a c o n t r a c t   * * * not         founded on an i n s t r u m e n t i n

w r i t i n g " must be commenced w i t h i n f i v e y e a r s .               Further, that the

a l l e g e d o r a l c o n t r a c t s t o make a w i l l were v o i d a s i n v i o l a t i o n of

t h e s t a t u t e o f f r a u d s , s e c t i o n 13-606, R . C . M .       1947, and s e c t i o n

93-1401-7(1) and ( 4 ) , R.C.M.                  1947.

               During t h e c o u r s e o f t h e t r i a l t h e d i s t r i c t judge g r a n t e d

d e f e n d a n t ' s motion f o r a d i r e c t e d v e r d i c t a s t o t h e c l a i m s of

p l a i n t i f f s f o r wages and s h a r e s o f p r o f i t f o r t h e y e a r s 1956 t o

1961, on t h e ground t h a t s u c h c l a i m s were b a r r e d by t h e a p p l i c a b l e
s t a t u t e of l i m i t a t i o n s .   The c o u r t a l s o d e t e r m i n e d t h e d e f e n d a n t

had performed t h a t p o r t i o n o f t h e agreements r e g a r d i n g t h e d r a f t i n g

o f a w i l l , s i n c e d e f e n d a n t had d r a f t e d        and e x e c u t e d a w i l l naming

p l a i n t i f f s Donald Davis and Dan Davis a s d e v i s e e s o f c e r t a i n

p r o p e r t i e s i n Powell County which p l a i n t i f f s had been managing

f o r defendant.            C o n s e q u e n t l y , a t t h e c l o s e o f t h e evidence, Count

I11 i n each c o m p l a i n t was d i s m i s s e d , w i t h o u t o b j e c t i o n . The m a t t e r was

t h e n s u b m i t t e d t o t h e j u r y , which r e t u r n e d a v e r d i c t i n f a v o r of

e a c h p l a i n t i f f i n t h e amount of $38,205.34.

             Defendant-appellant presents f i v e i s s u e s f o r review:

              1.    Whether t h e v e r d i c t and judgment i n t h e d i s t r i c t

c o u r t a r e s u p p o r t e d by s u b s t a n t i a l e v i d e n c e .

             2.     Whether p l a i n t i f f s must be h e l d , a s a m a t t e r o f law,

t o have waived t h e i r r i g h t t o i n s i s t on t h e performance t h e y

c l a i m t o be due from d e f e n d a n t under t h e a l l e g e d o r a l c o n t r a c t s .

             3.     Whether p l a i n t i f f s a r e p r e c l u d e d from r e c o v e r y on

t h e a l l e g e d c o n t r a c t s i n view o f t h e i r own b r e a c h .

             4.     Whether t h e d i s t r i c t c o u r t e r r e d i n a d m i t t i n g e v i d e n c e

of t h e a l l e g e d o r a l c o n t r a c t s t o make a w i l l d e v i s i n g r e a l p r o p e r t y .

             5.     Whether t h e a l l e g e d o r a l c o n t r a c t s t o d e v i s e r e a l

p r o p e r t y and t o pay a c e r t a i n s h a r e of p r o f i t s from r a n c h o p e r a -

t i o n s a r e unenforceable a s being i n v i o l a t i o n of t h e s t a t u t e of

frauds.

             P l a i n t i f f s argue t h e appeal should be dismissed f o r f a i l u r e

o f d e f e n d a n t t o move f o r a new t r i a l , and t h a t d e f e n d a n t ' s i s s u e

2 , w a i v e r , and i s s u e 3 , b r e a c h , a r e n o t p r o p e r i s s u e s a s t h e y were

not raised a t the d i s t r i c t court level.

             I n t h e f i r s t i n s t a n c e , defendant has adequate procedural

ground t o s u p p o r t h i s a p p e a l and a f a i l u r e t o move f o r a new t r i a l
i s n o t f a t a l t o h i s a p p e a l , a s urged by p l a i n t i f f s .           Defendant

d i d move t h e d i s t r i c t c o u r t f o r . d i r e c t e d v e r d i c t a t t h e c l o s e
                                                 a

o f a l l t h e e v i d e n c e based p r i n c i p a l l y on t h e ground t h a t t h e

e v i d e n c e p r e s e n t e d a t t r i a l was i n s u f f i c i e n t t o e s t a b l i s h a b a s i s

upon which t h e j u r y c o u l d r e a s o n a b l y f i n d t h a t t h e c o n t r a c t s

existed.            T h i s motion p r e s e n t e d t o t h e t r i a l c o u r t t h e same q u e s -

t i o n which p l a i n t i f f s u r g e can o n l y be p r e s e n t e d i n a motion f o r

a new t r i a l f o l l o w i n g t h e v e r d i c t , i f t h i s C o u r t i s t o r e v i e w t h e

e v i d e n c e p r e s e n t e d a t t r i a l on a p p e a l .

             The q u e s t i o n urged on a p p e a l h e r e         ---    t h a t evidence t o

s u p p o r t a v e r d i c t i n f a v o r of p l a i n t i f f s was t o t a l l y l a c k i n g - - -

was d i r e c t l y p r e s e n t e d t o and r u l e d on by t h e d i s t r i c t c o u r t .

T h i s m a t t e r was t r e a t e d " i n K u c h i n s k i v . S e c u r i t y Gen. I n s . Co.,

1 4 1 Mont. 515, 518, 380 P.2d 889, t h u s l y :
             I1 I
                 A motion f o r a judgment o f n o n - s u i t , o r a
             motion f o r a d i r e c t e d v e r d i c t , i s i n e f f e c t
             a demurrer t o t h e e v i d e n c e and p r e s e n t s t o t h e
             t r i a l c o u r t a q u e s t i o n of law t o b e d e t e r m i n e d
              [ C i t i n g c a s e s ] , a n d where e i t h e r o f s u c h motions
             i s made i n t h e t r i a l c o u r t and o v e r r u l e d , t h e
             q u e s t i o n o f t h e s u f f i c i e n c y of t h e e v i d e n c e t o
             s u p p o r t t h e v e r d i c t and judgment i s b e f o r e t h i s
             c o u r t on a p p e a l from t h e judgment. ' La Bonte v .
             Mutual F i r e e t c . I n s . C o . , 75 Mont. 1 [ l o ] , 241
             P. 631, 634.
             11 1
                 I f a motion f o r a new t r i a l h a s n o t been made,
             t h e c o u r t w i l l review t h e evidence t o determine
             whether t h e r e i s any s u b s t a n t i a l e v i d e n c e t o
             j u s t i f y t h e v e r d i c t . [Citing cases. ] ' Harrington
             v. H. D. Lee M e r c a n t i l e Co., 97 Mont. 4 0 , 55, 33
             P.2d 553, 556."

             Here, t h e two i s s u e s p r e s e n t e d by d e f e n d a n t h a v i n g t o do

w i t h t h e a l l e g e d w a i v e r and b r e a c h o f p l a i n t i f f s , s h o u l d be

considered.

             Under t h e a d m i t t e d employment a g r e e m e n t s f o r t h e p e r i o d s

from 1957 t o 1964, and from 1965 t o 1966, and c o n c u r r e n t l y under

t h e a l l e g e d c o n t r a c t s t o s h a r e i n t h e p r o f i t s and t o draw a w i l l ,
d e f e n d a n t a d m i t t e d a n employment agreement t e r m i n a b l e a t w i l l ,

b u t d e n i e d t h e e x i s t e n c e o f any a l l e g e d c o n t r a c t s t o s h a r e i n

t h e p r o f i t s o r draw a w i l l .            I n t h e p r e t r i a l o r d e r i s s u e d by t h e

d i s t r i c t c o u r t s e t t i n g t h e t r i a b l e i s s u e s o f f a c t and law,

d e f e n d a n t ' s p o s i t i o n i s c o n s i s t e n t l y s t a t e d a s a d e n i a l o f any

alleged contracts either t o share i n the profits or t o f u l f i l l

any o b l i g a t i o n t o d e v i s e o r b e q u e a t h t o p l a i n t i f f s any p r o p e r t y

by w i l l .

               Rule 1 6 , Montana Rules of C i v i l P r o c e d u r e , p r o v i d e s

a p r e t r i a l conference w i l l formulate t h e i s s u e s :

               "Jc   *   JcThe c o u r t s h a l l make a n o r d e r which r e c i t e s
               t h e a c t i o n t a k e n a t t h e c o n f e r e n c e , t h e amendments
               a l l o w e d t o t h e p l e a d i n g s , and t h e a g r e e m e n t s made
               by t h e p a r t i e s a s t o any o f t h e m a t t e r s c o n s i d e r e d ,
               and which l i m i t s t h e i s s u e s f o r t r i a l t o t h o s e n o t
               d i s p o s e d o f by a d m i s s i o n s o r a g r e e m e n t s o f c o u n s e l ;
               and s u c h o r d e r when e n t e r e d c o n t r o l s t h e s u b s e q u e n t
               course of t h e a c t i o n , unless modified a t t h e t r i a l
               t o prevent manifest i n j u s t i c e .             * * *"
               The p r e t r i a l o r d e r s e t t i n g f o r t h d e f e n d a n t ' s c o n t e n t i o n s

i n d i c a t e s t h a t t h e c o n t r a c t s under which t h e p l a i n t i f f s were

employed were t e r m i n a b l e a t w i l l , and m a i n t a i n s a d e n i a l o f any

of p l a i n t i f f s ' a l l e g e d c o n t r a c t s w i t h d e f e n d a n t .    This Court i s

compelled t o a g r e e w i t h p l a i n t i f f s ' argument t h a t i t s t a n d s t o

r e a s o n i f t h e r e were no c o n t r a c t s t h e r e c o u l d b e n o b r e a c h e s ,

and i f t h e agreements were t e r m i n a b l e a t w i l l , t h e p l a i n t i f f s were

e n t i t l e d t o t e r m i n a t e a t any t i m e t h e y saw f i t .              However, o f more

c r u c i a l w e i g h t i s t h e p r o c e d u r a l p r o c e s s which r e c o g n i z e s t h a t

t h e i s s u e s o f w a i v e r and b r e a c h were n o t made i s s u e s a t t h e t r i a l

and t h u s may n o t b e i n t r o d u c e d on a p p e a l .             This Court has s a i d

on numerous o c c a s i o n s t h a t i t w i l l c o n s i d e r f o r r e v i e w o n l y t h o s e

questions raised i n t h e t r i a l court.                       Spencer v . R o b e r t s o n , 1 5 1

Mont. 307, 445 P.2d 4 8 ; C l a r k v . W o r r a l l , 146 Mont. 374, 406 P.2d
                 I n r e f e r e n c e t o i s s u e 4 , we deem t h e a d m i s s i o n o f e v i d e n c e

 o f t h e a l l e g e d o r a l c o n t r a c t s t o make a w i l l d e v i s i n g r e a l p r o p e r t y

 t o have no b e a r i n g on t h i s a p p e a l , i n view 0 5 t h e d i s t r i c t c o u r t ' s

d i s m i s s a l of Count I11 i n e a c h c o m p l a i n t a t t h e c l o s e o f t h e

evidence.             The i s s u e o f t h e a l l e g e d o r a l c o n t r a c t s t o d e v i s e

p r o p e r t y under t h e w i l l o f d e f e n d a n t was removed from t h e j u r y

w i t h o u t o b j e c t i o n and t h u s i s n o t a p a r t of t h i s a p p e a l .

                 I n c o n s i d e r i n g t h e p r i n c i p a l q u e s t i o n p r e s e n t e d by d e f e n d a n t

i n t h i s a p p e a l , namely           ---    t h a t evidence t o support a v e r d i c t i n

f a v o r o f p l a i n t i f f s was t o t a l l y l a c k i n g       ---    we w i l l b e g u i d e d by

t h e long s t a n d i n g r u l e i n Montana a s s t a t e d i n Bernhard v. L i n c o l n

County, 150 Mont. 557, 560, 437 P.2d 377:

                " \ h e n s u c h a q u e s t i o n i s b e f o r e t h i s c o u r t we w i l l
                only review t h e evidence t o decide i f t h e v e r d i c t i s
                s u p p o r t e d by s u b s t a n t i a 1 e v i d e n c e . Breen v . Indus t r i a 1
                A c c i d e n t Board (Mont. 1 9 6 8 ) , 436 P.2d 701. The f a c t
                t h a t t h e r e were c o n f l i c t s i n t h e t e s t i m o n y does n o t
                mean t h e r e i s n o t s u b s t a n t i a l e v i d e n c e t o s u p p o r t t h e
                v e r d i c t . W must a c c e p t t h e e v i d e n c e b e l i e v e d by t h e
                                   e
                          I
                j u r y u n l e s s t h a t evidence i s s o i n h e r e n t l y impossible
                o r improbable a s n o t t o be e n t i t l e d t o b e l i e f                  *.'*
                Wallace v . W a l l a c e , 85 Mont. 492, 279 P. 374, 377, 66
                A.L.R. 587 (1929)."

An examina'tion o f t h e e n t i r e r e c o r d r e v e a l s c o n f l i c t i n g b u t

s u b s t a n t i a l evidence t o support t h e j u r y ' s                  finding of a contract

a s opposed t o a v o l u n t a r y bonus.

                Defendant makes a s t r o n g argument t h a t t h e t e s t i m o n y o f

h i s two a c c o u n t a n t s , b o t h C.P.A. ' s , d e m o n s t r a t e s t h e y e a r l y pay-

ment was a bonus t h a t was p a i d by d e f e n d a n t t o t h e p l a i n t i f f s and

u n d e r s t o o d t o be p a i d o n l y o u t o f " n e t o p e r a t i n g p r o f i t s f ' o f t h e

ranching operations.                    A t t h e t r i a l one a c c o u n t a n t d e f i n e d t h e
1f
     n e t o p e r a t i n g p r o f i t f f a s " t h a t would i n c l u d e a l l r a n c h s a l e s ,

e x c e p t t h e s a l e s of l i v e s t o c k upon which t h e F e d e r a l income t a x

p e o p l e w i l l g i v e us c a p i t a l g a i n s t r e a t m e n t " .        The o t h e r d e s c r i b e d
t h e operating p r o f i t a s t h e gross s a l e s of t h e c a t t l e l e s s

e x p e n s e s , a n d . t h a t a s c h e d u l e of c a p i t a l g a i n s was k e p t w i t h

such sums b e i n g t r e a t e d d i f f e r e n t l y f o r income t a x purposes.

             A r e t i r e d v i c e - p r e s i d e n t and t r u s t o f f i c e r o f t h e F i r s t

N a t i o n a l Bank and T r u s t Company o f Helena, t e s t i f i e d a s t o h i s

understanding i n these matters a s t h e r e s u l t of an e s t a t e planning

meeting i n 1965 w i t h George Davis, Donald Davis and t h e a c c o u n t                                 -

             "A.  Well, a s I r e c a l l i t , M r . George Davis e x p l a i n e d
             what h i s i d e a was of n e t o p e r a t i n g income f o r t h e
             purpose o f d e t e r m i n i n g s a l a r y and bonuses--for a s a l a r y
             and bonus arrangement, and t h a t was t h e g r o s s o p e r a t i n g
             income, e x c l u d i n g c a p i t a 1 g a i n s , l e s s o r d i n a r y o p e r a t i n g
             expenses, and n o t i n c l u d i n g d e p r e c i a t i o n , and t h a t
             would b e t h e n e t - - t h a t would l e a v e you t h e n e t p r o f i t
             from t h e o p e r a t i o n . "  (Emphasis s u p p l i e d )

             I n c o n t r a s t t o t h e above s t a t e m e n t s s u p p o r t i n g d e f e n d a n t ' s

p o s i t i o n , t h e testimony o f t h e b r o t h e r s , Donald and Dan Davis,

s t a n d s i n a d i f f e r e n t l i g h t from t h e o u t s e t .        While t h e element

o f d e p r e c i a t i o n i s n o t c o n t e s t e d by t h e p l a i n t i f f s i n d e t e r m i n i n g

t h e n e t o p e r a t i n g p r o f i t s , c l e a r l y d i f f e r e n t t e s t i m o n y was g i v e n

i n r e g a r d t o t h e i n c l u s i o n o f t h e element of c a p i t a l g a i n s i n

t h e n e t o p e r a t i n g income.         Dan Davis t e s t i f i e d :

             "Q.      Now, i f you know, when you made t h i s o r i g i n a l
             agreement o r arrangement i n 1965, was t h e r e any
             d i s c u s s i o n had a s t o whether t h e c a p i t a l g a i n s income
             would be t r e a t e d t h e same way t h a t t h e o t h e r income
             was, M r . Davis? [ O b j e c t i o n s u s t a i n e d a t t h i s p o i n t . ]

             "MR LEAPHART: Was t h e r e any d i s c u s s i o n , l e t me p u t i t
             t h a t way?

             A .   The d i s c u s s i o n t h a t took p l a c e , w e l l , t h a t was
             never discussed            ---t h e y n e v e r t o l d m e t h a t i t was
             t o be deducted. It was j u s t supposed t o b e n e t p r o f i t .

             11
              Q . [Cross-examination] And when you s a y ' a l l o f t h e
             p r o f i t ' what do you mean by t h a t ?

             "A.  The d i f f e r e n c e between t o t a l s a l e s and t o t a l
             expenses, t h e p r o f i t .
             "Q.       Now, i n t h a t c l a i m t h a t you make, were you
             c o n t e n d i n g t h a t you were e n t i t l e d t o c a p i t a l p a i n ?

             "A.     When h e made t h e agreement w i t h u s , h e n e v e r
             s a i d a n y t h i n g a b o u t h o l d i n g o u t c a p i t a l g a i n s . 11
             (Emphasis s u p p l i e d )     .
Dan Davis went on t o s t a t e t h a t h i s s t a t e m e n t a p p l i e d t o b o t h

of t h e a l l e g e d c o n t r a c t s .

             Donald Davis on c r o s s - e x a m i n a t i o n t e s t i f i e d :

             "Q.      Now, t h e s e y e a r s when h e went o v e r t h e income
             and t h e expense o r t h e r a n c h w i t h you, and showed
             h i s p r o f i t , you and h e f r e q u e n t l y d i d n ' t s e e t h e
             p r o f i t t h e same, o r what t h e p r o r i t was a s you con-
             t e n d was t o b e s h a r e d , i s t h a t r i g h t ?

             'A.       I d o n ' t e v e r remember o f h a v i n g any d i s c u s s i o n
             w i t h him. A t t i m e s when we were l o o k i n g o v e r t h e s e
             f i g u r e s , no, he never i n d i c a t e d t h a t c a p i t a l g a i n s
             ever entered i n t o t h i s d e a l a t a l l , b u t only t h a t
             t h e p r o f i t was t h e d i f f e r e n c e between t h e t o t a l s a l e s
             and t o t a l e x p e n s e s . He c l a i m e d t h a t t h e monies t h a t
             were t r e a t e d a s c a p i t a l g a i n s , a s f a r a s t a x p u r p o s e s
             were c o n c e r n e d , were i n c l u d e d i n t h e n e t p r o f i t s , i n h i s
             tax return.

             "Q.     Do you b e l i e v e h e [ d e f e n d a n t ] was confused a b o u t i t ?

             "A.     Well, a t f i r s t , t h e r e were t i m e s t h a t I t h o u g h t
             t h a t t h a t was a p o s s i b i l i t y .

             "Q.    That h e was c o n f u s e d , and d i d n ' t u n d e r s t a n d i t
             t h e way you d i d , i s t h a t r i g h t ?                      I

             .         Well, t h e r e was no doubt i n m mind t h a t t h e r e was
                                                               y
             a d i f f e r e n c e . Now. I d o n ' t know how h e u n d e r s t o o d i t . b u t
             h e had been i n t h e b u s i n e s s long enough t h a t i t was c e r -
             t a i n l y hard t o r m t o b e l i e v e t h a t he r e a l l y understood
                                        e
             i t t h e way he was t e l l i n g me h e u n d e r s t o o d i t - - - he had
             been i n t h e b u s i n e s s t o o l o n g t o make me b e l i e v e t h a t . 1 '
             (Emphasis s u p p l i e d )

             While t h e e v i d e n c e may s t a n d i n a p p a r e n t c o n f l i c t on t h e

inclusion o r exclusion of the c a p i t a l gains i n the n e t operating

p r o f i t o f t h e r a n c h e s , t h e j u r y was v e s t e d w i t h t h e s o l e c o n s i d e r a -

t i o n of t h e f a c t u a l i s s u e s and t h e c r e d i b i l i t y of w i t n e s s e s and

t e s t imony    .
              T h i s Court f i n d s n o t h i n g i n c o m p a t i b l e t h a t might n o t

 be e x p l a i n e d by t h e p r o p o s i t i o n t h a t d e f e n d a n t was concerned

 w i t h t a x m a t t e r s w i t h h i s a c c o u n t a n t s , and t r e a t e d Donald Davis

 and Dan Davis d i f f e r e n t l y w i t h r e g a r d t o t h e c o n t r a c t o f p r o t i t

 sharing.        I t would b e wholly c o r s i s t e n t w i t h t h e normal under-

 s t a n d i n g and r e p r e s e n t a t i o n s g i v e n t o t h e Davis b r o t h e r s t h a t

 t h e p r o f i t s meant revenues minus e x p e n s e s .               The r e l a t i v e p o s i t i o n s

 t a k e n i n t h e l a w s u i t s and t h e i n t r o d u c t i o n o f t e s t i m o n y r e g a r d i n g

 t a x m a t t e r s i s c o l l a t e r a l t o t h e i s s u e o f t h e u n d e r s t a n d i n g be-

 tween George Davis and t h e b r o t h e r s .                 T h i s Court w i l l n o t d i s t u r b

 t h e f a c t u a l d e t e r m i n a t i o n s of t h e j u r y and f i n d s n o t h i n g t h a t i s

 i n c r e d i b l e o r i n s u f f i c i e n t i n t h e e v i d e n c e produced a t t r i a l ,

 upon which t h e j u r y r e l i e d .

              In regard t o defendant's t i n a l issue---the                         s t a t u t e of

 frauds a s a bar t o o r a l c o n t r a c t s - - - i t         is sufficient t o note

 t h a t t h e o r a l c o n t r a c t s o f p r o f i t s h a r i n g r e l i e d upon a t t r i a l ,

 were f u l l y e x e c u t e d on t h e p a r t o f t h e p l a i n t i f f s and a s s u c h

 represent         a w e l l r e c o g n i z e d e x c e p t i o n t o t h e s t a t u t e of f r a u d s .

 Besse v . McHenry, 89 Mont. 520, 300 P . 199.

             The judgment o f t h e t r i a l

                                   /                              Associate J u s t i c e

Ua*-------
     Chief J u s t i c e

     Associae Q s t i c e s .