In Re The Marriage Of Amber E. Szafryk

• Decision Date: 27 April 2010
• Docket Number: No. DA 09-0162.,DA 09-0162.
• Parties: In re the MARRIAGE OF Amber E. SZAFRYK, Petitioner and Appellee,andJohn M. SZAFRYK, Respondent and Appellant.
• Court: Montana Supreme Court

356 Mont. 141
232 P.3d 361
2010 MT 90

In re the MARRIAGE OF Amber E. SZAFRYK, Petitioner and Appellee,
and
John M. SZAFRYK, Respondent and Appellant.

No. DA 09-0162.

Supreme Court of Montana.

Submitted on Briefs March 17, 2010.
Decided April 27, 2010.

232 P.3d 362

For Appellant: Ryan A. Phelan; P. Mars Scott; P. Mars Scott Law Offices; Missoula, Montana.

For Appellee: Kathleen O'Rourke-Mullins; Robert A. Terrazas; Terrazas Law Office; Missoula, Montana.

Justice W. WILLIAM LEAPHART delivered the Opinion of the Court.

¶ 1 Respondent John Szafryk (John) appeals the ruling of the District Court for the Fourth Judicial District, Missoula County, that pursuant to two divorce settlement agreements, John forfeited his right to use property owned by his ex-wife Amber Szafryk (Amber) by assigning an interest in his car dealership to a third person. John also appeals the District Court's award of rent and attorney's fees to Amber. We affirm.

¶ 2 We address the following issues on appeal:

¶ 3 1. Whether the District Court erred in concluding that John forfeited his right to use the dealership property by violating anti-assignment clauses contained in the parties' settlement agreements.

¶ 4 2. Whether the District Court erred in requiring John to pay rent to Amber for using her property after the date of the alleged transfer.

¶ 5 3. Whether the District Court erred in determining that John should pay Amber monthly rent of $2,500.

¶ 6 4. Whether the District Court erred in awarding Amber attorney's fees and costs.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 7 Amber and John married in Dillon, Montana, in 1964. In 2001 Amber petitioned to dissolve the marriage. The dissolution, Amber testified, was acrimonious. In 2003 the District Court dissolved the marriage. The decree of dissolution incorporated two settlement agreements, which divided the parties' property and debts. Amber, believing

232 P.3d 363

John to be in violation of the settlement agreements, initiated the present proceeding.

¶ 8 In 1983 John started an automobile dealership, Country Ford Inc. (“Country Ford” or “dealership”), in Plains, Montana. John at all relevant times has owned all shares of Country Ford. The dealership consisted of new- and used-car sales departments and a repair shop. John and Amber jointly owned the land and building where Country Ford is located (dealership property). When they divorced, John was awarded the dealership, and Amber received the dealership property. This arrangement is the center of the present dispute.

¶ 9 In July 2002 the parties signed their initial settlement agreement (Settlement Agreement), which allocated the dealership property to Amber

subject to husband[']s right to possession and use of this property as a Ford dealership (continuation of existing operation) for a maximum of 5 years. Husband[']s use right shall require husband to keep the improvements and fixtures and property in good repair, normal wear and tear excepted and capital improvements excepted. Husband shall pay all taxes, SIDS or other assessments during his period of use. Husband shall pay all costs of insurance (at current levels). Should husband sell, assign, transfer or otherwise divest himself of his dealership his use right shall terminate without compensation or abatement.

The Settlement Agreement allocated the dealership to John. The Settlement Agreement contains a provision for attorney's fees: “Should either party be required to enforce the terms of this agreement, the prevailing party shall be entitled to his or her attorney[']s fees and costs incurred in such enforcement action.”

¶ 10 Apparently dissatisfied with the Settlement Agreement, the parties agreed to an addendum (Addendum) a year later. The Addendum dealt mainly with the dealership and the dealership property. It reads in part:

On page 3 of the Settlement Agreement, it was agreed that husband would be entitled to possession and use of the property as a Ford dealership for a maximum of five (5) years. The parties have agreed to modify this understanding and provide husband and his company, Country Ford, Inc., with the right to possess and use the property, rent free, through the 24th day of July, 2008. No rent or other consideration is to be paid to wife or her assignee or successor in interest for husband's possession or use except as provided herein. Such lease relationship is subject to the following terms:

Any additional terms set forth in the original Settlement Agreement dated July 24, 2002.

....

The commitment set forth herein is non-assignable and personal to husband. If husband sells his interest in Country Ford, Inc., in whole or in part, or if he sells all of the assets of Country Ford, Inc., or otherwise ceases to continue the existing businesses, the operation of the Ford dealership and the used car dealership, the lease relationship shall immediately terminate.

The Addendum also provided for attorney's fees: “To the extent that the wife finds it necessary to retain an attorney to assist her in the enforcement of the terms and conditions of the agreement (lease), then husband agrees to reimburse wife for said attorney's fees at the hourly rate of $175.00 per hour.” The present question is whether John violated the anti-assignment clauses of the Settlement Agreement and Addendum.

¶ 11 Prompted by a series of events occurring in early 2006, Amber moved the District Court to order John to remove Country Ford from her property for violating the anti-assignment provisions of the Settlement Agreement and Addendum (collectively, “settlement agreements”). The standing master assigned to the case held a hearing in October 2007, and the parties and witnesses presented testimony. While only a partial transcript of this hearing (which includes none of the exhibits admitted) has been presented to this Court, the dispositive facts are undisputed.

¶ 12 In November 2005 John and Wade Rehbein (Wade) began discussing the possibility of Wade's purchasing Country Ford.

232 P.3d 364

Wade owned Outback Automotive Company (Outback Automotive), an automobile repair business in Plains. Upon John's suggestion, Wade asked Amber about leasing or purchasing the property. Amber allowed Wade to inspect the dealership building. Amber consulted other renters in Plains to determine an appropriate rent. She offered to rent the property to Wade for $3,300 per month, then lowered the offer to $2,500. Since Wade stated that he could only afford $1,000 per month, they did not reach a rental agreement. Wade then offered to buy the dealership property, but he and Amber again failed to reach an agreement.

¶ 13 In March 2006 Wade contacted Ford Motor Company (Ford) about acquiring the Country Ford franchise. He was advised that Ford required applicants to have two years of experience as a general manager. Wade could not meet this prerequisite. Undeterred by these setbacks, Wade hired an attorney to draft an asset purchase agreement (Asset Purchase Agreement). Under this agreement, Wade would buy the dealership for approximately $180,000, and the sale would close in July...