Brinkman and Lenon, Architects and Engineers v. P & D Land Enterprises, 93-346

• Decision Date: 01 February 1994
• Docket Number: No. 93-346,93-346
• Citation: 263 Mont. 238,51 St.Rep. 36,867 P.2d 1112
• Court: Montana Supreme Court
• Parties: BRINKMAN AND LENON, ARCHITECTS AND ENGINEERS, Plaintiff and Respondent, v. P & D LAND ENTERPRISES, a joint venture by NDI, Inc., and Minnesota Trust Company of Austin, a Minnesota Corp., Defendants and Appellants.

Page 1112

867 P.2d 1112

263 Mont. 238

BRINKMAN AND LENON, ARCHITECTS AND ENGINEERS, Plaintiff and Respondent, v. P & D LAND ENTERPRISES, a joint venture by NDI, Inc., and Minnesota Trust Company of Austin, a Minnesota

Corp., Defendants and Appellants.

No. 93-346.

Supreme Court of Montana.

Submitted on Briefs Dec. 22, 1993.

Decided Feb. 1, 1994.

A. Clifford Edwards, Kevin M. Funyak, Edwards Law Firm, Billings, for defendants and appellants.

Debra D. Parker, Kendra L. Kawaguchi, Murphy, Robinson, Heckathorn & Phillips, Peter D. Plunkett, Warren F. Plunkett & Associates, Austin, MN, David M. Ortley, Kalispell, for plaintiff and respondent.

GRAY, Justice.

In this case, we conclude that the District Court erred in granting summary judgment to plaintiff Brinkman & Lenon because plaintiff failed to meet its initial burden of establishing the absence of genuine issues of material fact. Therefore, we reverse and remand.

The facts necessary to our resolution of this case are straightforward. Brinkman and Lenon, Architects and Engineers (Brinkman), entered into a standard form architectural contract with P & D Land Enterprises (P & D) on May 21, 1990. Pursuant to the contract, Brinkman was to perform certain architectural and engineering services in connection with improvements to real estate owned by P & D and P & D was to pay for those services. Under § 4.10 of the contract, P & D was required to give written notice of any deficiency in performance of the services. Section 8.6 required that, in the event of termination of the contract by P & D not resulting from any fault of Brinkman, payment was to be made for services performed prior to the termination date.

Brinkman filed a breach of contract action against P & D in the Eleventh Judicial District Court, Flathead County. Brinkman asserted that it performed services under the contract, and that P & D terminated the contract and then failed to pay the amount owing to Brinkman at that time, in violation of § 8.6 of the contract. In its answer, P & D admitted the existence of the contract and its termination, but denied any breach by it or that it owed Brinkman any money under the contract. P & D also counterclaimed, alleging both breach of contract and negligent failure to provide proper services which resulted in delays, unnecessary expense and lost revenue.

Prior to discovery, Brinkman moved for summary judgment and presented the contract, a letter from P & D, an affidavit and certain invoices in support of its motion. P & D responded generally that issues of fact were raised by the pleadings and not met by Brinkman in its motion and supporting materials. The District Court granted Brinkman's motion for summary judgment via Memorandum and Order and judgment was entered.

Pursuant to Rule 59(g), M.R.Civ.P., P & D moved the court to alter or amend its judgment, on the basis that Brinkman did not meet its initial burden of establishing the absence of genuine issues of material fact. In particular, P & D argued that its answer and counterclaim required Brinkman to establish entitlement to payment under the contract by, among other things, presenting evidence that P & D failed to give written notice of deficiencies in Brinkman's services as required by the contract. According to P & D, Brinkman offered only statements of counsel regarding the lack of written notice of deficiencies; no evidence of the lack of such required notice was provided via affidavit or otherwise. Thus, P & D contended, the question of whether such notice was given was a genuine issue of material fact raised by its answer and counterclaim and not met by Brinkman. P & D also presented correspondence to Brinkman, which it characterized as written notice of deficiencies in performance.

Brinkman responded that P & D had the burden of establishing that it had given the required notice of deficiency in response to the motion for summary judgment. Having failed to do so, Brinkman argued, P & D's presentation of the correspondence purporting to establish that it had given the required notice was untimely. According to Brinkman, P & D was required to raise this "substantive defense" in opposition to the motion for summary judgment. Relying on Scott v. Robson (1979), 182 Mont. 528, 597 P.2d 1150, the District Court denied the motion to alter or amend on the basis that the letter was not timely offered in opposition to the motion for summary judgment and could not be considered thereafter. P & D appeals from the summary judgment which became final upon the court's denial of its motion to alter or amend.

Did the District Court apply the correct standard to Brinkman's motion for summary judgment?

Our standard of review in appeals from summary judgment is de novo; we review a summary judgment utilizing the same criteria used by the District Court initially under Rule 56, M.R.Civ.P. Minnie v. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214. We determine whether there is an absence of genuine issues of material fact and whether the moving party is entitled to judgment as a matter of law. Minnie, 849 P.2d at 214. In this case, we conclude that summary judgment was improper because the record is devoid of the required showing of proof demonstrating an absence of genuine issues of material fact and an entitlement to judgment as a matter of law. Specifically, we focus on the District Court's determination that P & D did not notify Brinkman of any deficiency in performance.

It is clear that a party moving for summary judgment bears the initial burden of establishing the absence of any genuine issue of material fact and its entitlement to judgment as a matter of law. Rule 56(c), M.R.Civ.P. Furthermore,

[w]hen a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of [its] pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial.

Rule 56(e), M.R.Civ.P. (Emphasis added.) Put another way, the nonmoving party has no obligation to establish that genuine issues of fact exist until the moving party has shown an absence of such issues of fact; unless that initial burden is met by the moving party, the nonmoving party may rest on its pleading. Minnie, 849 P.2d at 214.

In Mathews v. Glacier General Assurance Co. (1979), 184 Mont. 368, 603 P.2d 232, the plaintiff alleged entitlement to the policy limits under a contract for insurance as a result of fire damage. The defendant insurer generally denied the...