Reaves v. Reinbold

• Citation: 37 St.Rep. 1500,615 P.2d 896,189 Mont. 284
• Decision Date: 25 August 1980
• Docket Number: No. 80-139,80-139
• Parties: Robert REAVES, Plaintiff and Appellant, v. Joseph REINBOLD, Defendant and Respondent.
• Court: United States State Supreme Court of Montana

Page 896

615 P.2d 896

189 Mont. 284

Robert REAVES, Plaintiff and Appellant, v. Joseph REINBOLD, Defendant and Respondent.

No. 80-139.

Supreme Court of Montana.

Submitted on Briefs July 10, 1980.

Decided Aug. 25, 1980.

Jerrold L. Nye; Stacey & Nye, Billings, for plaintiff and appellant.

H. Elwood English, Billings, for defendant and respondent.

DALY, Justice.

Plaintiff appeals from an order of the District Court, Yellowstone County, the Honorable William J. Speare presiding, whereby plaintiff's motion for summary judgment was denied and defendant's motion for summary judgment was granted.

In November 1975 defendant Joseph Reinbold was hired by Lincoln Benefit Life Company to sell life insurance as a district representative. Reinbold was to work under the supervision of plaintiff Robert Reaves, a general agent for Lincoln Benefit Life.

Under a "Submitted Annualized Commission Agreement," dated November 21, 1975, Reinbold's income was to be based on commissions from sales of insurance policies. In addition, the agreement provided that Lincoln Benefit Life would advance $1,250 per month against future earned first year commissions. Reinbold, as district representative, Reaves, as general agent, and D. L. Sayler, as vice president of Lincoln Benefit Life Company, were signatories to this agreement.

On November 20, 1975, prior to signing the commission agreement, Reinbold received a letter from Reaves stating in pertinent part:

"Joe, you have your $900 guarantee (sic) but I think you will far exceed that in earnings. Just as a little help I'll throw in $100.00 each month expense money."

Reinbold claims this letter evidences an oral agreement between plaintiff and himself whereby plaintiff gave his personal guarantee that Reinbold would receive $900 a month without regard to the advance payments from Lincoln Benefit Life. Reaves has denied any such oral agreement with defendant.

Reinbold quit his employment with Lincoln Benefit Life in March 1976. At that time it was determined that Lincoln Benefit Life had paid Reinbold $2,341.65 more in advance payments than he had earned in commissions. The money owed by Reinbold was collected by Lincoln Benefit Life from Reaves under a company agreement they had with him as a general agent. Reaves, in turn, sued Reinbold to recover the money Reaves had paid to the company.

Upon the suit being filed, Reinbold moved for dismissal on the basis of lack of jurisdiction. This motion was heard and denied. A preliminary pretrial conference was then held on December 11, 1979, during which the court ordered all discovery be completed by February 6, 1980.

On January 24,1980, Reaves filed a motion for summary judgment alleging there was no question of either law or fact. Reinbold responded with his own motion for summary judgment on February 7, 1980. Argument on the motions was held in chambers at the time set for final pretrial conference on February 14, 1980.

On February 26, 1980, Loren "Pi" Page, regional vice president for Lincoln Benefit Life, was unexpectedly in Billings, Montana, from his office in Denver, Colorado. Reaves's attorney used that opportunity to take his deposition to preserve his testimony for use at trial. In the deposition, Page explained the relationship that general agents, district representatives and regional vice presidents have with Lincoln Benefit Life Co. and each other.

On March 11, 1980, the court entered summary judgment for defendant. The District Court, in granting defendant's motion, found that there was an oral agreement between Reaves and Reinbold wherein Reaves personally guaranteed Reinbold $900 a month and that the letter of November 20, 1975, was a written memorandum of that oral agreement.

Plaintiff's attorney filed a motion to alter and amend the judgment on March 14, 1980. The District Court denied this motion and plaintiff appeals.

On appeal plaintiff raises three issues:

1. Whether it was error and an abuse of discretion for the District Court to grant summary judgment for defendant.

2. Whether it was error for the District Court not to enter summary judgment for plaintiff as a matter of law.

3. Whether it was error and an abuse of discretion for the District Court not to consider the testimony of Loren "Pi" Page prior to any decision in this case.

Summary judgment under Rule 56(c), M.R.Civ.P., is proper only if the record discloses no genuine issue of material fact and the moving party is entitled to a judgment as a matter of law. Johnson v. Johnson (1977), 172 Mont. 150, 561 P.2d 917; Anderson v. Applebury (1977), 173 Mont. 411, 567 P.2d 951.

This Court has consistently held that the party moving for summary judgment has the burden of showing the complete absence of any genuine issue as to all the facts which are deemed material in light of those substantive principles which entitled him to a judgment as a matter of law. Bahn v. Dormanen (1975), 168 Mont. 408, 543 P.2d 379; Harland v. Anderson (1976), 169 Mont. 447, 548 P.2d 613; Bonawitz v. Bourke (1977), 173 Mont. 179, 567 P.2d 32. To satisfy this burden the movant must make a clear showing as to what the truth is so as to exclude any real doubt as to the existence of any genuine issue of material fact. Kober v. Stewart (1966), 148 Mont. 117, 417 P.2d 476; 6 Moore's Federal Practice P56.15(3).

It is clear that the party opposing a motion for summary judgment will be afforded the benefit of all reasonable inferences which may be drawn from the offered proof. Mally v. Asanovich (1967), 149 Mont. 99, 423 P.2d 294; Harland v. Anderson, supra.

The District Court could properly grant summary judgment to defendant here only by finding that, on the submitted record, a valid oral contract existed between the parties which provided that plaintiff would pay defendant, at a minimum, $900 per month.

In support of a finding that such an oral agreement existed, defendant submitted to the court: (1) an affidavit alleging that plaintiff in a telephone conversation offered to pay defendant $900 per month; (2) a letter from plaintiff to defendant stating that defendant would have his $900 guarantee; and (3) an admission by plaintiff that "defendant was paid $900 per month in accord with the submitted annualized commission agreement," when in fact the figure for advances under the agreement was $1,250 per month.

In response to defendant's allegations, plaintiff has denied any existence of an oral contract between the parties. He contends that any conversation or letter that dealt with money to be paid defendant related to the amount to be advanced against future commissions by Lincoln Benefit Life and not to any guaranteed salary to be paid by plaintiff.

As the record indicates, whether the parties intend an oral contract whereby plaintiff guaranteed a $900 per month salary to defendant is an important factor in need of consideration in this case. When an issue of fact arises as to the existence of a contract and the intentions of the parties play an important part in the resolvement of that question, this Court has held that summary judgment is usually inappropriate. Kober v. Stewart (1966), 148 Mont. 117, 417 P.2d 476; Fulton v. Clark (1975), 167 Mont. 399, 538 P.2d 1371.

Defendant argues that summary judgment is appropriate in this instance because the District Court, prior to its decision on defendant's motion, was presented with all the evidence needed to decide the issue of whether an oral contract existed as alleged. We disagree with defendant's contention.

It is true that the purpose of the summary judgment procedure is to encourage judicial economy through the elimination of an unnecessary trial. However, it is also true that the procedure is never to be a substitute for trial if a factual controversy exists. Engebretson v. Putnam (1977), 174 Mont. 409, 571 P.2d 368; Duncan v. Rockwell Mfg. Co. (1977), 173 Mont. 382, 567 P.2d 936; Bonawitz v. Bourke (1977), 173 Mont. 179, 567 P.2d 32.

We find that defendant, as the moving party, has not met his burden of establishing the absence of an issue of fact as to the existence of the oral contract as alleged. In viewing the record in a light most favorable to plaintiff, we conclude that a material factual issue exists and is in need of proper resolvement at the trial...