Frank v. Huston, 2008 MT 455N (Mont. 12/31/2008)
| Decision Date | 31 December 2008 |
| Docket Number | No. DA 07-0575,DA 07-0575 |
| Parties | FRANK and SALLY ZITO, Plaintiffs and Appellants, v. DAVE HUSTON, his heirs and assigns; HUSTON FAMILY LIVING TRUST a/k/a HUSTON FAMILTY TRUST; BO PIERSON, as Trustee of the HUSTON FAMILY LIVING TRUST a/k/a HUSTON FAMILY TRUST; and JOHN and/or MARY DOES 1-10, Defendants, Appellees and Cross-Appellants. |
| Court | Montana Supreme Court |
Appeal from: District Court of the Sixteenth Judicial District, In and For the County of Garfield, Cause No. DV 2006-2873 Honorable David Cybulski, Presiding Judge.
For Appellants: Paula S. Saye-Dooper; Saye Law, PLLC; Billings, Montana Robert L. Stephens, Jr., Southside Law Center; Billings, Montana
For Appellees and Cross-Appellants: Mark S. Hilario; Harper & Hilario, PLLP; Billings, Montana
¶1 Pursuant to Section I, Paragraph 3(c), Montana Supreme Court 1996 Internal Operating Rules, the following decision shall not be cited as precedent. It shall be filed as a public document with the Clerk of the Supreme Court and shall be reported by case title, Supreme Court cause number and result to the State Reporter Publishing Company and to West Group in the quarterly table of noncitable cases issued by this Court.
¶2 Frank and Sally Zito ("the Zitos") appeal from the order of the Sixteenth Judicial District Court, Garfield County, denying an award of damages for claims addressing Dave and Kathryn Huston and the Huston Family Trust's (collectively "the Hustons") refusal to provide or defend access to property they sold the Zitos. The Hustons cross-appeal the District Court's denial of their motion for additional time to respond to the Zitos' discovery request. We affirm in part and reverse in part, remanding to the District Court for proceedings consistent with this Opinion.
¶3 In the interest of brevity, we recite only those facts relevant to our holding. In 1996, the Zitos and Hustons began negotiating the purchase of 640 contiguous acres of the Hustons' property in the Missouri Breaks area of Garfield County. These negotiations came to fruition in 1998, when the Hustons executed a warranty deed conveying 40 acres to the Zitos on April 14, and a contract for deed conveying the remaining 600 acres on May 5. The Zitos' residence sits on the 40 acre portion of the 640 acre property. The Hustons retained all rights associated with grazing the 600 acre portion of the Zitos' property for the duration of the Contract for Deed in exchange for upkeep of fences and payment of property taxes.
¶4 The Zitos, accompanied by Dave Huston, viewed the property on one occasion before they purchased it. To access the property, they traveled along a dirt road which Dave indicated was "[t]he only way in and the only way out." Throughout the course of the transaction, the Hustons were aware of the Zitos' intent to create a farmstead residence on the remote property. At the time the properties were conveyed, both parties believed that the Zitos would have continued access to the 640 acres purchased via the route by which they viewed the property.
¶5 The aforementioned route crossed two properties, one owned by Christo and Beth Pierce and the other by Stephen Negaard. Until November 6, 2002, the Zitos had unimpeded access to their property over the Pierce and Negaard properties (hereinafter "the Pierce/Negaard"). On this date, the Pierces blocked the Zitos' access to their property. The Zitos filed suit, asserting they had a prescriptive easement over the Pierce/Negaard, and were granted a temporary restraining order allowing them access during the litigation. Ultimately, the Zitos did not prevail, and were permanently prohibited from using the original access route.
¶6 During the Zitos' attempt to secure a prescriptive easement across the Pierce/Negaard, they notified the Hustons that, pursuant to the Contract for Deed, the Hustons were contractually obligated to either defend the access route across the Pierce/Negaard, or to provide alternate legal access to the Zitos' property. They sought both financial indemnification with respect to the significant legal fees accrued in their attempt to secure a prescriptive easement, and direct assistance in obtaining alternate legal access to their property.
¶7 Since November of 2004, the Zitos have been using a longer alternate four wheel drive road to access their property, one to which they have no legal title. The road is primarily on Bureau of Land Management ("BLM") land, but crosses a small section of the Hustons' property en route to the Zitos' property. The Hustons granted the Zitos an easement to use the short section of the four wheel drive trail that crosses their property. However, while the BLM allows the Zitos permissive use of the road, it does not permit them to maintain it, nor has it granted the Zitos an easement. Essentially, the Zitos lack legal access to their property. Furthermore, the BLM road they are now using to access their property is significantly rougher than their original route. This alternate access has appreciably increased the hardships already inherent in accessing a remote location.
¶8 At some point during the course of the Zitos' prolonged attempts to gain legal access to their property, the previously amicable relationship between the parties deteriorated. The Zitos claim that several incidents and altercations with the Hustons over the BLM leases, fencing, and control of a water source caused them emotional distress. They also attribute emotional distress, pain and suffering to the difficulties they have faced as a result of the access situation.
¶9 On June 27, 2006, the Zitos filed a complaint against the Hustons alleging four counts: breach of warranty, breach of contract and the implied covenant of good faith and fair dealing, negligent misrepresentation, and actual malice.
¶10 The Zitos commenced discovery on August 10, serving their First Discovery Request upon the Hustons, including a Request for Admissions. Responses were due by September 12. For reasons not relevant to our Opinion, the Hustons did not respond. On October 27, the Zitos filed a Motion to Compel Discovery and Memorandum of Law in support of the motion, as well as a Notice of Defendant's Admissions. They also filed a Motion for Partial Summary Judgment based on those admissions. On December 8, the Hustons filed a Motion for Additional Time to answer the Zitos' discovery requests. The District Court denied the Hustons' motion and correspondingly recognized the Zitos' motion to recognize the Hustons' admissions pursuant to Rule 36(a). As a result, the court issued an order granting summary judgment on the Zitos' claims of breach of warranty, breach of contract, and malice, and set the matter for a hearing on the issue of damages.
¶11 The damage hearing lasted approximately two days, with the Zitos presenting witness testimony and exhibits without objection or significant contradiction by the Hustons. Toward the end of the damage hearing, the court engaged in a dialogue with Zitos' counsel regarding its concern that there were two entirely unrelated transactions between the Hustons and Zitos, creating two completely separate access issues. The court's disquiet arose because in its view, the Zitos' damages were attributable solely to the lack of residential access to the 40 acres conveyed by warranty deed, and under its interpretation there had been no access warranted under the Warranty Deed. Thus, it could discern no basis upon which to award damages. The court's focus was upon interpretation of the two documents conveying property to the Zitos, with no mention of the remaining counts of the complaint.
¶12 The court's order reflected this singular focus, which ultimately formed the critical underpinning for its conclusions. In a conclusory order, the District Court determined that the Zitos were not entitled to legal access to their property under either the Contract for Deed or the Warranty Deed; and that since "appropriate" agricultural access to the 600 acre parcel had been provided via the BLM road, neither the breach of warranty nor breach of contract claims could support an award of damages due to a lack of legal, residential access. Because the court viewed the entirety of the Zitos' damages as related to residential access as opposed to agricultural access, it denied an award of damages based on those counts.
¶13 The court's focus on the breach of warranty and breach of contract claims left only a cursory discussion of the remaining counts of the complaint. In a perfunctory conclusion, the court determined the Zitos had not proven damages for breach of the covenant of good faith and fair dealing, negligent misrepresentation, or actual malice. It further concluded that the Zitos' emotional distress claims were "not well taken." Importantly, despite the conclusory nature of the court's findings and conclusions, it essentially abandoned the grant of summary judgment, addressing liability for each count of the complaint. This appeal followed.
¶14 We review a district court's findings of fact under the clearly erroneous standard, its discretionary rulings for abuse of discretion, and its legal conclusions and mixed questions of law and fact under a de novo standard. Stanley v. Lemire, 2006 MT 304, ¶ 26, 334 Mont. 489, ¶ 26, 148 P.3d 643, ¶ 26.
¶15 We restate the dispositive issues on appeal:
¶16 I. Did the District Court err in concluding that the Hustons' failure to provide an appropriate easement to the Zitos' property did not constitute a breach of contract?
¶17 II. Did the District Court err in concluding that there had been no proof of damages attributable to the Zitos' negligent misrepresentation claim?
¶18 III. Did the District Court err in concluding that there was no proof of damages attributable to the...
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