McClellan v. Britain

• Decision Date: 11 February 1992
• Docket Number: No. 91-120,91-120
• Citation: 826 P.2d 245
• Parties: Elta McCLELLAN, by and through her Conservator; the Estate of Arthur L. McClellan, by and through its Personal Representative; and the Double S Sheep Company, a Wyoming corporation, Appellants (Plaintiffs), v. Patricia BRITAIN and Oscar Robert Britain, Appellees (Defendants).
• Court: Wyoming Supreme Court

Page 245

826 P.2d 245

Elta McCLELLAN, by and through her Conservator; the Estate of Arthur L. McClellan, by and through its Personal Representative; and the Double S Sheep Company, a Wyoming corporation, Appellants (Plaintiffs), v. Patricia BRITAIN and Oscar Robert Britain, Appellees (Defendants).

No. 91-120.

Supreme Court of Wyoming.

Feb. 11, 1992.

Ann M. Rochelle of Williams, Porter, Day & Neville, Casper, for appellants.

Cherie Shelton Norman of Skiles & Hageman, Laramie, for appellees.

Before URBIGKIT, C.J., THOMAS and MACY, JJ., BROWN, J. (Retired), and LEHMAN, District Judge.

BROWN, Justice, Retired.

Over a twenty year period, in five-year increments, appellees Patricia and Oscar Robert Britain (Britains) leased lands from appellant, The Double S Sheep Company (Double S). After the leasing year 1988, a dispute arose with respect to whether a lease for an additional five years had been effected. The trial court determined that it had and entered summary judgment accordingly.

The single issue on appeal is: Was summary judgment properly granted?

We affirm.

Britains first leased grazing land from Double S in 1968 for a period of five years. Arthur L. McClellan and Elta McClellan were the sole shareholders in Double S. The parties continued to execute new leases at five year intervals. The 1978 lease included a provision that the Britains have a right or option to renew the lease for five years; the Britains would pay the first year's rental and a portion of the final year's rental upon execution; and succeeding payments would be made on an annual basis. The lease also included an option to renew, which stated that the Britains could exercise their option to renew by giving notice to Double S in writing via registered mail, return receipt requested, not less than thirty days before the expiration of the lease. The Britains exercised their rights under this option and the parties executed a new lease in 1983. The renewal provision of the 1983 lease provided:

6. Lessor [Double S] covenants and agrees to give Lessees [Britains] the first right or option to renew this lease for an additional five year term commencing December 10, 1988, provided Lessor does not intend to use the lands for its own purposes or for the sale thereof and provided that Lessees shall give notice in writing to the Lessor, sent registered mail, return receipt requested, to the Lessor's Casper, Wyoming address not less than thirty (30) days prior to the expiration of the primary term of this lease and provided further that Lessees pay the amount of rental offered by some other responsible party.

In 1986, the parties entered into an Agreement Revising Terms of Lease. The new agreement modified the terms of payment and required the Britains to make monthly, rather than annual, payments and to pay in full the final year of the lease before the commencement of the final year.

On November 6, 1988, a month before the expiration of the 1983 lease, Robert Britain sent notice to Double S stating his intent to exercise his renewal option. The notice was sent certified mail, return receipt requested in compliance with provision 6 of the lease. Following delivery of the notice, Britain commenced negotiations with Art McClellan, President of Double S, with respect to the amount of rent. On February 22, 1989, Britain sent a letter to McClellan offering to pay $7,500 a year at $625 per month on a new five-year lease to run from December 10, 1988 to December 10, 1993. Consistent with earlier leases, Britain also offered to pay $1,000 toward the last year's payment on December 10 of every year until December 1992, when he would pay $3,500, which constituted the balance remaining on the final year.

Enclosed with the February 22, 1989 letter was a check to Double S in the amount of $2,500. Britain noted on the check that the payment was for the first four months of the new five-year grazing lease. The check was endorsed by Art McClellan as President of Double S on March 9, 1989.

On April 4, 1989, Patricia Britain sent Double S a check in the amount of $2,250. The notation on her check stated that it was to cover the April and May lease payments, plus $1,000 toward the rent owing on the last year of the lease. This payment was also accepted by Art McClellan. The Britains filed a notice of real estate lease on April 24, 1989 and mailed a copy to Double S. Art McClellan died in May 1989.

The Britains continued to pay rent to Double S and these checks were accepted. In late 1989, another $1,000 was paid toward the last year of the lease. In accepting one of the checks, Elta McClellan, the secretary of Double S Sheep Company, wrote on the back of the check, "partial payment of lease."

Double S, in an amended complaint, alleged that there was no valid lease and that the Britains were not paying an adequate rental amount. The Britains moved for summary judgment on October 15, 1990. The basis of their motion was that they had complied with paragraph 6 of the 1983 lease. They contended that once they complied with that provision, the lease was renewed, notwithstanding the fact that no new written lease had been executed. Succinctly, the Britains contended that notice was sent to Double S before the expiration of the current lease which gave notice of the Britains' intent to renew; that Art McClellan accepted two payments which on their face stated that they were tendered in partial satisfaction of the lease; that Elta McClellan endorsed one of the checks with the notation "partial payment of lease"; and that all checks have since been accepted. In its brief, Double S states that some of the checks have been held.

Because there was no issue of material fact, and compliance with paragraph 6 was complete, the Britains asserted they were entitled to summary judgment. Double S opposed the motion for summary judgment. The materials submitted in support of their opposition consisted of affidavits of Elta McClellan, Phil Gordy and George Hornberger and the depositions of the Britains. Double S further requested that the court take judicial notice of the estate of Arthur McClellan probate file, a lawsuit involving the various shareholders of Double S, and the records in the Secretary of State's office regarding Double S. Summary judgment was granted to appellees on March 25, 1991 and appeal followed.

"When reviewing a summary judgment on appeal, our duty is the same as that of the district court in that we have before us the same material and must follow the same standards." Noonan v. Texaco, Inc., 713 P.2d 160, 162 (Wyo.1986). See also Jones v. Chevron U.S.A., Inc., 718 P.2d 890 (Wyo.1986).

"A motion for summary judgment places an initial burden on the movant to make a prima facie showing that no genuine issue of material fact exists and that summary judgment should be granted as a matter of law. Rule 56(c), Wyoming Rules of Civil Procedure. Once a prima facie showing is made, the burden shifts to the party opposing the motion to present specific facts showing that a genuine issue of material fact does exist. England v. Simmons, Wyo., 728 P.2d 1137, 1140-1141 (1986). We analyze challenges to a grant of summary judgment by reviewing the record in a light most favorable to the party opposing the motion giving him all favorable inferences that can be drawn from the facts."

TZ Land & Cattle Co. v. Condict, 795 P.2d 1204, 1208 (Wyo.1990) (quoting Boehm v. Cody Country Chamber of Commerce, 748 P.2d 704, 710 (Wyo.1987)). In order to defeat a summary judgment motion, the opposing party must, by affidavits or depositions, raise specific facts, not conclusions. Davenport v. Epperly, 744 P.2d 1110, 1112 (Wyo.1987).

The evidence submitted by the Britains in support of their motion for summary judgment was sufficient to make a prima facie case that renewal of the lease had been effected. After a prima facie case was made, the burden shifted to Double S to show that a genuine issue of material fact did exist. TZ Land & Cattle Co., 795 P.2d at 1208. Double S did not meet that burden.

Double S' opposition to motion for summary judgment filed on January 31, 1991, never explained how its evidentiary material was relevant to the summary judgment motion. None of the materials referenced by Double S served to rebut the prima facie showing the Britains made in their motion for summary judgment.

Elta McClellan's affidavit stated that the corporate status of Double S had been revoked and that at no time did she or Double The affidavit of Phil Gordy stated that he typed a letter for Mr. McClellan to the Britains, but did not state when the letter was prepared or mailed. The letter attached to the affidavit is undated, unsigned and does not state the Britains' correct address. Nothing in either the letter or the affidavit contradicts the facts set forth by the Britains. Robert Britain denied that he had received the letter.

                S enter into a lease with the Britains.  The affidavit further stated that to the best of Mrs. McClellan's knowledge, Art McClellan did not enter into a lease with the Britains on behalf of himself or Double S.  The affidavit went on to raise the issue of litigation regarding the shareholders of Double S and stated that the present rental amount "is not a fair price."   Finally, the affidavit stated that, in accepting one payment, Mrs. McClellan did not acknowledge a five-year lease but only acknowledged receipt of one check
                

The affidavit of George Hornberger stated that the lease price was unreasonable, that the fair annual rental in December 1988 would have been $15,000, and that a responsible party would have offered such a price. The affidavit never stated that $15,000 or any other amount was ever offered by a responsible party. Paragraph 6 of the lease was clearly conditioned, not on a perceived rental value, but on "the amount of rental offered by some other responsible party." (Emphasis added.)

Because Double S did not contradict either the...