Firelight v. 3 Rivers, DA 07-0263.

• Citation: 186 P.3d 869, 2008 MT 202, 344 Mont. 117
• Case Date: June 10, 2008
• Court: United States State Supreme Court of Montana

186 P.3d 869 2008 MT 202 344 Mont. 117 FIRELIGHT MEADOWS, LLC, a Montana Limited Liability Company, Plaintiff and Appellant,
v.
3 RIVERS TELEPHONE COOPERATIVE, INC., a Montana Corporation, Defendant and Appellee. No. DA 07-0263. Supreme Court of Montana. Submitted on Briefs January 8, 2008. Decided June 10, 2008.

[186 P.3d 871]

For Appellant: Ward E. Taleff, Taleff Law Office, P.C., Great Falls, Montana.

For Appellee: Michael J. Rieley, Michael J. Rieley, P.C., Helena, Montana.

Justice JAMES C. NELSON delivered the Opinion of the Court.

¶ 1 Firelight Meadows, LLC (Firelight), appeals an order of the District Court for the Eighteenth Judicial District, Gallatin County, finding in favor of 3 Rivers Telephone Cooperative, Inc. (3 Rivers) on 3 Rivers' Motion for Judgment on the Pleadings. We affirm.

¶ 2 We address the following issue on appeal: Whether the District Court erred in granting 3 Rivers' Motion for Judgment on the Pleadings.

Factual and Procedural Background

¶ 3 3 Rivers, a cooperative nonprofit membership corporation, is authorized by the Federal Communications Commission to install, operate, and maintain telephone services within certain areas of Montana. On May 7, 2001, 3 Rivers entered into an "Aid to Construction Agreement" (the Agreement) with Firelight, a limited liability company, whereby Firelight agreed to pay 3 Rivers $85,497.88 to aid 3 Rivers in the costs it would incur in installing, operating and maintaining telephone facilities for services to Firelight's subdivision in Big Sky, Montana. The Agreement required 3 Rivers to refund to Firelight all or part of the monies in accordance with the following terms:

a. If the actual cost is less than the estimated cost, the excess will be refunded when construction is complete.

b. A cost per lot, housing unit or condo (units) will be determined by dividing number of units (216) into the total cost.

c. The developer will receive one-fifth of the cost per unit back each year provided that the unit takes continuous service for five consecutive years. The five-year clock starts January 1, 2003.

¶ 4 Pursuant to the Agreement, Firelight paid 3 Rivers $42,748.94 on July 9, 2001, and an additional $37,801.54 on February 6, 2002, for a total of $80,550.48. On July 7, 2004, Firelight demanded that 3 Rivers pay interest on the monies Firelight had paid to 3 Rivers in the amount of 10% per annum. When 3 Rivers rejected Firelight's demand for payment of interest, Firelight brought this action asking the District Court to declare that the Agreement constituted a loan and that 3 Rivers must pay interest on all money advanced to 3 Rivers under the Agreement.

¶ 5 Firelight filed its Complaint in this matter on December 30, 2004. Attached to Firelight's Complaint and referenced within the Complaint as Exhibit 1, was a copy of the May 7, 2001 Agreement between the parties. Firelight subsequently amended its complaint seeking recovery of the principal amount paid as well as interest on that amount. Firelight filed this First Amended Complaint on January 5, 2005. While this First Amended Complaint contained a reference to the Agreement as Exhibit 1, Firelight did not attach a copy of the Agreement.

¶ 6 On July 15, 2005, 3 Rivers filed its Answer to First Amended Complaint arguing that it had paid Firelight "monetary amounts in full satisfaction and discharge of" Firelight's claim. In addition, 3 Rivers disputed and denied liability to Firelight with respect to the amount Firelight claimed it was due. Thereafter, 3 Rivers filed its Motion for Judgment on the Pleadings pursuant to M.R. Civ. P. 12(c) arguing that the Agreement was not a loan because repayment of the monies advanced to 3 Rivers by Firelight was conditional, not absolute.

¶ 7 In its June 1, 2006 order granting 3 Rivers' Motion for Judgment on the Pleadings, the District Court pointed out that there was no dispute about what the Agreement said, whether both parties willingly signed it, or any other factual issue. Thus,

186 P.3d 872

the court determined that the only disputed issue—whether the Agreement constituted a loan under Montana law—was a question of law. In deciding that question, the court concluded that the Agreement did not constitute a loan, consequently Firelight was not entitled to interest on the money it paid to 3 Rivers.

¶ 8 Firelight now appeals the District Court's order.

Standard of Review

¶ 9 M.R. Civ. P. 12(c) provides that "[a]fter the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings." In Clayton by Murphy v. Atlantic Richfield Co., 221 Mont. 166, 717 P.2d 558 (1986), this Court adopted the articulation in Doleman v. Meiji Mut. Life Ins. Co., 727 F.2d 1480 (9th Cir.1984), of the showing a movant must make under Fed.R.Civ.P. 12(c). Specifically, "[t]he movant must `clearly establish that no material issue of fact remains to be resolved and that he is entitled to judgment as a matter of law.'" Clayton, 221 Mont. at 169-70, 717 P.2d at 560 (quoting Doleman, 727 F.2d at 1482, in turn quoting Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure: Civil § 1368 at 690 (1st ed., West 1969)). This articulation, however, does not embrace all of the relevant considerations for evaluating a Rule 12(c) motion.

¶ 10 A motion for judgment on the pleadings

is designed to provide a means of disposing of cases when the material facts are not in dispute between the parties and a judgment on the merits can be achieved by focusing on the content of the competing pleadings, exhibits thereto, matters incorporated by reference in the pleadings, whatever is central or integral to the claim for relief or defense, and any facts of which the district court will take judicial notice.

Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure: Civil vol. 5C, § 1367 at 206-07 (3d ed., Thomson-West 2004) (footnote omitted). The motion "only has utility when all material allegations of fact are admitted or not controverted in the pleadings and only questions of law remain to be decided by the district court"—e.g., where the sole question is the interpretation of a statutory provision. Federal Practice and Procedure, § 1367 at 207-10. If all material issues cannot be resolved on the pleadings, then a summary judgment motion or a full trial is necessary. Federal...