Van Ettinger v. Pappin

• Decision Date: 18 December 1978
• Docket Number: No. 14253,14253
• Citation: 180 Mont. 1,35 St.Rep. 1956,588 P.2d 988
• Parties: Robert C. VAN ETTINGER et al., Plaintiffs and Appellants, v. Robert F. PAPPIN et al., Defendants and Respondents.
• Court: Montana Supreme Court

Page 988

588 P.2d 988

180 Mont. 1

Robert C. VAN ETTINGER et al., Plaintiffs and Appellants, v. Robert F. PAPPIN et al., Defendants and Respondents.

No. 14253.

Supreme Court of Montana.

Submitted Nov. 22, 1978.

Decided Dec. 18, 1978.

Richter & Lerner, Alan J. Lerner (argued), Billings, Hartelius & Lewin, Great Falls, for plaintiffs and appellants.

Swanberg, Koby, Swanberg & Matteucci, John L. Alke (argued), Great Falls, for defendants and respondents.

DALY, Justice.

This is an appeal by the plaintiffs from summary judgment entered in behalf of the defendants by the District Court of the Eighth Judicial District, County of Cascade, the Honorable Joel G. Roth sitting without a jury.

On December 3, 1975, the Van Ettingers, appellants, filed this action for damages arising out of a contract for the sale of real estate under which they purportedly purchased an easement for the use of a swimming pool. The complaint alleged breach of contract, fraud, negligence and violation of the Real Estate License Act by defendant-respondents. Respondents are the Pappins, prior owners of the house; Tom Mather, James Durkin and Tom Mather & Associates, the realtors involved in the sale; and Western Surety Company, the realty bonding company.

Depositions were taken and interrogatories were exchanged. On June 30, 1977, respondents filed a motion for summary judgment on all of appellants' claims for relief. On September 26, 1977, appellants filed a cross-motion for partial summary judgment on the issues of liability on all claims and on the issue of statutory damages and entitlement to attorney fees under the Real Estate License Act.

Following oral argument on November 7, 1977, on the mutual motions for summary judgment, the District Court entered findings of fact, conclusions of law, and an order granting respondents' motion for summary judgment and denying appellants' cross-motion for summary judgment.

On appeal appellants do not contest the District Court's ruling that a claim of negligence under the circumstances states no case upon which relief can be granted. They do contest the dismissal of the counts alleging breach of contract fraud, and violation of the Real Estate License Act.

This case involves the use of a swimming pool which straddles two lots, numbered 29 and 30, in a Great Falls, Montana, subdivision. Two additional lots, numbered 13 and 14, are involved in the controversy. The lots abut one another as diagrammed:

NOTE: OPINION CONTAINS TABLE OR OTHER DATA THAT IS NOT VIEWABLE

In 1961 defendant Robert Pappin owned lots 14 and 29 and defendant Tom Mather owned lots 13 and 30. At that time they agreed to jointly develop lots 29 and 30. As part of this development, they built a swimming pool straddling lots 29 and 30. Mather subsequently sold lot 30 to the Penningtons, who along with the Pappins, still the owners of lot 29, executed and recorded in September, 1961, an easement for the use of the swimming pool in favor of each other. This easement does not mention either lot 13 or 14.

In October, 1961, another easement agreement was drawn, purportedly between the owners of all four lots, whereby the owners of lots 29 and 30 granted a permanent easement for the use of the pool to the owners of lots 13 and 14. Under this agreement the costs necessary to use of the pool were to be borne equally by the parties. This easement was not recorded nor was the name or signature of the owner of lot 29 provided. It appears that at the time of the execution of this instrument Pappins still owned both lots 14 and 29; the Mathers signed as owners of lot 13; and the Penningtons signed as owners of lot 30. At the time of the incidents complained of in this case, lot 29 was owned by the Nobles, lot 30 by the Howrys, and lot 13 by the Mathers until January 1, 1974, and the Huffords thereafter.

Although the ownership of the various lots changed over time, the unrecorded easement agreement was honored by all subsequent owners. In August, 1973, however, the Pappins sent a letter to the "Members of the Swimming Pool Association" stating that as a result of their move to a downtown apartment they were "resigning from the swimming pool" and seeking instructions as to whether the remaining members "wish(ed) the new owners to participate in the swimming pool or if (they) would prefer to retain it among the three present members." Thereafter the Pappins did not contribute to the upkeep of the pool.

In September, 1973, the Pappin home located on lot 14 was listed for sale with Tom Mather's real estate agency. Pappin, as a real estate salesman in this agency, received a $386.50 listing commission. Without the knowledge of Pappin, however, Tom Mather indicated on the multiple listing employment contract that included in the sale of the house was a "perpetual easement for pool use via 1/4 expenses sharing". The multi-listing agreement and newspaper advertisements for this property prepared from the multiple listing employment contract both mentioned the easement for the use of the pool.

In May, 1974, Robert Van Ettinger, intending to move with his family from California to Great Falls, signed a buy-sell agreement with the Pappins. This agreement contained three references to the swimming pool:

"The following personal property is also to be left upon the premises as a part of the property purchased . . . and easement for pool use . . .

". . .llo

"* It is understood by the buyer that the pool is owned by Lots 29 and 30, Block 7, Country Club Addition and that Lot 14 has had the right of easement for use by contributing one-fourth (1/4) of the cost of maintanance (sic), operation and taxes.

". . .s u

"The use of the pool requires the buyer to pay 1/4 of the cost of the operation of the pool."

In early July, 1974, after talking to the owners of lots 29 and 30, Van Ettinger became concerned that he and his family would not be allowed to use the swimming pool. He was assured by the real estate agency that they would be allowed to use the pool.

On July 20, prior to final closing of the sale, appellants moved into the house on lot 14. On the same day the access gate between lot 14 and the pool was removed by the owners of lots 29 and 30. On July 21 Van Ettinger tried to use the pool and was prohibited from doing so by Howry, who threatened to have him arrested for trespass. On July 22 Van Ettinger hand delivered a letter to Tom Mather demanding he rectify the pool situation created by the Nobles' and Howrys' refusal to let them use the pool. Mather talked to the Nobles and Howrys and tried to convince them to allow appellants the use of the swimming pool. They refused, and Mather then talked to appellants on July 26, advising them that the Nobles and Howrys would not acquiesce to their use of the pool. To placate appellants Mather offered at that time to buy them a country club membership which would allow them use of the country club's pool.

In spite of these events appellants closed their loan application with the lending institution on July 28, 1974, and closed the sale transaction on July 30. After closing the transaction, appellants filed the instant action.

The following issues are presented to this Court for review:

1. Whether the District Court erred in granting respondents' motion for summary judgment on appellants' count alleging breach of contract?

2. Whether the District Court erred in granting respondents' motion for summary judgment on appellants' count alleging fraud?

3. Whether the District Court erred in denying appellants' motion for partial summary judgment on their count alleging violation of the Real Estate License Act of 1963 and in granting respondents' motion for summary judgment on appellants' count alleging violation of the Real Estate License Act of 1963?

It is most productive to begin analyzing this problem from the last events backwards and determine the effect on the various causes of action of appellants proceeding to closing the sales transaction. This effect is seen most clearly on the contract theory in appellants' complaint. Despite the assertion by appellants that they closed the transaction on July 20, the record itself indicates the transaction did not close until between July 28 and 30. In his deposition Mr. Van Ettinger himself states it was between the 28th and 30th of July when he signed the papers at the bank. The warranty deed from Pappins to appellants, a document of public record, was not executed until July 29 and was not delivered to appellants until July 30. In addition appellants remained in possession of the house at least until April 29, 1976, when their depositions were taken.

In view of this record appellants' simple assertion that the transaction closed on July 20 will not serve to create an issue of fact merely to avoid summary judgment. Brown v. Thornton (1967), 150 Mont. 150, 155, 432 P.2d 386, 389.

The determination that the transaction closed between July 28 and 30 means the events taking place until then must be considered in determining the effect of appellants' decision to close the sale. Between July 20 and 28, appellants witnessed the removal of the access gate to the swimming pool on July 20, the date they moved into the house on lot 14; Mr. Van Ettinger was threatened with arrest for trespassing when he attempted to use the pool on July 21; and defendant Tom Mather, after talking to the owners of lots 29 and 30, informed appellants on July 26 that these parties refused to allow them use of the pool.

Despite these graphic indications from the other parties that there might be defects in the purported easement and the apparent acquiescence by one of the realtors involved in the matter, appellants proceeded through final closing stages of the sales transaction and remained in possession of the house.

Clause 3 of the sales contract being sued upon states:

"If the seller does not approve the sale within two days hereafter, or if seller's title is not merchantable...