Blaser v. Cameron

• Decision Date: 26 June 1989
• Docket Number: No. 17202,17202
• Parties: Albert E. BLASER, Plaintiff-Appellant, v. Harvey A. CAMERON and Katherine M. Cameron, husband and wife, Defendants-Respondents.
• Court: Idaho Court of Appeals

Page 462

776 P.2d 462

116 Idaho 453

Albert E. BLASER, Plaintiff-Appellant, v. Harvey A. CAMERON and Katherine M. Cameron, husband and wife, Defendants-Respondents.

No. 17202.

Court of Appeals of Idaho.

June 26, 1989.

Jon N. Wyman of Wyman & Wyman, Boise, for plaintiff-appellant.

Michael J. Gaffney of Ringert, Clark, Harrington, Reid, Christenson & Kaufman, Boise, for defendants-respondents.

SWANSTROM, Judge.

This case presents an issue of law with respect to a rule of procedure. We are asked to decide whether a seller's claim for money due on a real estate contract should be barred for failure to plead it as a compulsory counterclaim in the buyers' earlier action for specific performance. We hold--contrary to the decision of the district court--that appellant's claim for money due on a real estate contract is not barred for failure to plead it in the earlier action. Accordingly, for reasons which follow, we vacate the judgment. We remand for a decision on the merits.

The pertinent facts are straightforward. In 1974 Albert Blaser as seller and Harvey and Katherine Cameron as buyers entered into a contract for the purchase of a lot and the construction of a cabin upon the lot. According to the contract, Blaser promised, among other things, to construct a cabin and supply it with water. The Camerons promised to pay $10,000 down and provide on-site labor for Blaser to offset any construction costs exceeding the down payment. The Camerons made the down payment, Blaser constructed the cabin and the Camerons took possession, at least temporarily. However, the parties became embroiled in a dispute over the water supply and a carpeting allowance. In June 1976 Blaser offered the Camerons three options for settling the dispute: (1) they could rescind the contract, (2) they could complete the purchase under the contract by paying a balance of $16,000 in construction costs, or (3) they could continue staying in other housing supplied by Blaser until an amount of rent accrued equivalent to the down payment.

The Camerons responded by bringing an action in July 1976 against Blaser for specific performance of his promise to provide an adequate water system. Blaser counterclaimed for damages to a well pump and for the reasonable value of rent for the housing the Camerons were living in. Blaser's counterclaim contained no allegation that the Camerons then owed him any money on account of the sale of the lot and the construction of the cabin. The trial court in the 1976 action found Blaser to be in material breach of contract for failing to provide an adequate water supply. Accordingly, judgment was entered directing Blaser to specifically perform his promise to provide an adequate domestic water system "within a reasonable time." As to Blaser's counterclaim, the court found that he had agreed the Camerons could reside in the apartment owned by Blaser, rent free, until water was provided to the cabin. The court also held there was no evidence to support Blaser's claim for damages to a well pump. The court dismissed the counterclaim.

Blaser eventually completed the water system. In 1982 he brought the present action to recover from the Camerons the balance of the construction costs owing under the sales contract. Following a non-jury trial, the district court concluded that the principle of res judicata barred Blaser's present claim because it should have been pled as a compulsory counterclaim in the 1976 action. Judgment dismissing Blaser's claim was entered and this appeal followed.

Compulsory counterclaims come within the purview of I.R.C.P. 13(a). The application of this procedural rule is a question of law on which we exercise free review. In pertinent part Rule 13(a) provides: "A pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim...." The failure to plead a claim properly classified as a compulsory counterclaim bars any subsequent action on the claim. While this consequence is consistent with general principles of res judicata, subsequent actions on claims properly classified as compulsory under Rule 13(a) are barred simply by operation of the rule itself. Joseph v. Darrar, 93 Idaho 762, 472 P.2d 328 (1970).

Moreover, the above quoted language contains the first of four express exceptions to the general rule that a counterclaim is compulsory and must be asserted if it arises out of the same transaction or occurrence. A counterclaim falling under one of these exceptions will not be barred in future litigation. The first exception, and the one urged here, is that a party need not assert a counterclaim if it has not matured at the time of his pleading, even if it arises from the same transaction or occurrence. The application of this exception turns on whether the claim is one which the claimant could, at the date of his pleading in the earlier action, have maintained against the other party. See 6 C. WRIGHT & A. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1411 (1971).

It is not disputed that Blaser's present claim and the subject matter of the Camerons' earlier action arose out of the same transaction or occurrence--the sales contract. The focus is on whether Blaser could have maintained an action for money owing under the sales contract at the time of serving his pleading in the 1976 action.

When Blaser filed his answer and counterclaim in the 1976 action he was in material breach of the contract and the trial court so found. Consequently, Blaser had no legal basis for a claim against the Camerons for money owing under the sales contract. Blaser would not have a legal basis for such a claim until he had completed his promised performance to supply adequate domestic water. See RESTATEMENT (SECOND) OF CONTRACTS § 232, illustration 2 (1981). Therefore, Blaser could not have maintained an action against the Camerons for money owing under the sales contract at the time of serving his pleadings in the 1976 action. The Camerons insist that Blaser had an actionable claim in 1976 because he believed they owed him money and he had requested payment of a set amount. ¹ Blaser's assertion of money owed did not affect the determination of the time at which his claim matured; his assertion did not become an enforceable claim until he had fulfilled his obligations under the sales contract.

Furthermore, the policy behind Rule 13(a) is to avoid multiple lawsuits between the parties to a transaction or occurrence. This policy was not furthered here. Both sides have already presented the merits of their respective positions in a second trial only to have the action terminated on a procedural rule without reaching the merits of this extended controversy. Accordingly, we vacate the judgment and we remand for a decision on the merits.

We address a final issue raised by Blaser to clarify the proceedings on remand. After this action had commenced, but prior to trial, Harvey Cameron died. His estate was substituted as a party defendant. Blaser filed a notice of claim, based upon the money owing under the sales contract, against the estate of Harvey Cameron in a separate probate proceeding. No objection was made to the notice of claim. Blaser insists that the failure to object to his claim in the probate proceeding was tantamount in effect to a default judgment against the estate. We disagree.

It is unnecessary to present in a probate proceeding a notice of claim with regard to matters claimed in other judicial proceedings against the decedent pending at the time of his death. I.C. § 15-3-804(b). By parity of reasoning, it is unnecessary to object to such a contingent claim in the probate proceedings because a court, which already has jurisdiction over the matter, will determine the merits of the claim and of the legal and equitable defenses raised against it. Therefore, the notice of claim filed by Blaser against the estate of Harvey Cameron is of no present consequence to the current action.

The judgment is vacated. The case is remanded for a decision on the merits, but without prejudice to any defenses raised by the Camerons which have not been finally decided by the district court. Costs to Blaser. No attorney fees on appeal.

McQUADE, J. Pro Tem., concurs.

BURNETT, Judge, specially concurring.

Although I agree with the result of the foregoing opinion, I write separately to comment on the relationship between res judicata and "premature" claims. My analysis is grounded in the modern version of res judicata as set forth in the RESTATEMENT (SECOND) OF JUDGMENTS (1982). Our Court adopted the Second Restatement in Aldape v. Akins, 105 Idaho 254, 668 P.2d 130 (Ct.App.1983) (petition for review denied).

Res judicata embraces two distinct doctrines: claim preclusion and issue preclusion. Under the doctrine of claim preclusion, a valid final judgment generally extinguishes ...