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No. 13335 I N THE SUPREME C U T O THE STATE O MONTANA OR F F 197 6

DUANE L. C M T N and SHIRLEY O PO COMPTON, husband and w i f e ,

P l a i n t i f f s and Respondents,

FRED ALCORN d / b / a ALCORN'S TRAILER CITY, Defendant and Appellant.

Appeal from:

D i s t r i c t Court of t h e Eighth J u d i c i a l D i s t r i c t , Honorable R. 3 . Nelson, Judge p r e s i d i n g .

Counsel of Record: For Appellant : John M. McCarvel argued, Great F a l l s , Montana For Respondents: LaRue Smith argued, Great F a l l s , Montana Cameron Ferguson appeared, Great F a l l s , Montana

Submitted : October 20, 1976 Decided Filed :

:mC1 4 1976

DEC 14 1376

Chief Justice James T. Harrison delivered the Opinion of the Court. Defendant Fred Alcorn d/b/a Alcorn's Trailer City,appeals from a judgment for plaintiffs Duane L. Compton and Shirley Compton, husband and wife, entered in the district court, Cascade County, for rescission of a retail installment contract to purchase a three bedroom doublewide mobile home for $21,270 ($7,000 down, month). The contract

balance plus interest paid at

was entered into June 14, 1975, the mobile home delivered July 10, 1975, after payment of the down payment, andinitial installation was completed four days later. After this initial installation Comptons discovered these defects : The home was not level; the two halves did not match up on the outside; the carpet was not properly laid along the seam of the two halves; the damaged dining room table was not exchanged as promised; slip covers were not furnished to cover small holes in the ribbing of the couch; the hanging and installation of a dining room light fixture and the master bathroom light fixture was not completed; the cross-over air duct, heat transfer systems, and electrical connection between the two halves were not completed; nine bolts were omitted underneath the trailer in connecting the two halves; the cabinet support around the dishwasher was broken; the shelf in the front closet was not firmly attached; the smoke detector in the hall leading to the master bedroom was hanging loose; the shelves in the china closet were not assembled; there was no T joint connecting the Wtkz bath to the hot water tank; the heater unit was loose in its alcove; and a full set of keys was not delivered with the home.

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Compton telephoned Alcorn on t h r e e s e p a r a t e occasions t o i n q u i r e about t h i s delay i n completing t h e i n s t a l l a t i o n , during t h e period of J u l y 14, 1975 t o August 18, 1975, during which period

Mrs. Compton was i n Alabama.

Furthermore, he

and h i s son f i n i s h e d

l e v e l i n g and blocking t h e home, and f i x e d t h e c a b i n e t support around t h e dishwasher. The only o t h e r work Alcorn d i d was t h e r e p a i r t o t h e c a r p e t , and t h e securing of t h e h e a t e r u n i t on August 1 and 2, 1975. Sometime between J u l y 10, 1975 and August 1, 1975, t h e T j o i n t t o connect t h e master b a t h and t h e h o t water tank was a l s o i n s t a l l e d . Alcorn contends t h a t t h e remainder of t h e i n s t a l l a t i o n could n o t be completed u n t i l t h e u t i l i t i e s were hooked up, and such was t h e o b l i g a t i o n of Comptons. -During t h e l a s t of J u l y , water damage and s t a i n s appeared i n t h e c e i l i n g of t h e family room and t h e h a l l i n t h e n o r t h end of t h e home from roof leaks a f t e r a rainstorm. O August 8, 1975 n

Compton discovered t h e furnace was n o t vented t o t h e o u t s i d e , leaving t h e furnace unusable and dangerous. Smoke damage t o t h e

c e i l i n g was a l s o present above t h e h e a t e r , i n d i c a t i n g t h e furnace had been s t a r t e d sometime p r i o r t o d e l i v e r y , even though no vent was i n s t a l l e d . Following t h i s l a s t discovery, Compton awaited h i s w i f e ' s r e t u r n , contacted an a t t o r n e y and s e n t h i s n o t i c e of r e s c i s s i o n t o Alcorn Ahgust 25, 1975. Alcorn made no attempt t o c o n t a c t t h e

Comptons, contacted h i s a t t o r n e y , and t h i s s u i t followed. Alcorn questions t h e findings of f a c t and conclusions of law of t h e d i s t r i c t c o u r t g r a n t i n g r e s c i s s i o n , s p e c i f i c a l l y :

1 ) That Comptons contract;

had performed t h e i r o b l i g a t i o n s under t h e

2) That t h e r e was a s u b s t a n t i a l f a i l u r e of c o n s i d e r a t i o n promised by Alcorn t o Comptons; 3) That r e s c i s s i o n of t h e c o n t r a c t was i n o r d e r ; and 4) Comptons were e n t i t l e d t o reasonable a t t o r n e y f e e s . The scope of review applied t o a d i s t r i c t c o u r t ' s f i n d i n g s of f a c t and conclusions of law i s t h a t t h i s Court w i l l n o t d i s t u r b such i f they a r e supported by t h e evidence and t h e law. Brady

v. S t a t e Highway Comm'n, 163 Mont. 416, 517 P.2d 738; Timmerman v. G a b r i e l , 155 Mont. 294, 470 P.2d 528; Wash. Water Power Co. v. Morgan Elec. Co., 152 Mont. 126, 448 P.2d 683.

A s t o t h e f i r s t i s s u e f o r review, t h e record d i s c l o s e s
t h a t Comptons had paid a l l monies then owing under t h e c o n t r a c t , which was t h e i r only o b l i g a t i o n w i t h i n t h e terms of t h i s c o n t r a c t . The c o n t r a c t i t s e l f makes no mention of t h e Comptons' o b l i g a t i o n t o have t h e u t i l i t i e s i n working o r d e r before f i n a l i n s t a l l a t i o n . There, a l s o , was c o n f l i c t i n g evidence a s t o t h e understanding of t h e p a r t i e s t h a t complete hookup of t h e u t i l i t i e s was e s s e n t i a l t o f i n a l i n s t a l l a t i o n of t h e mobile home. Both Comptons t e s t i f i e d

t h a t t h e water, sewer, and gas l i n e s had been extended t o t h e s i t e of t h e home, but were n o t connected because they d i d n o t i n t e n d t o keep t h e mobile home because of i t s many d e f e c t s . Furthermore,

we f a i l t o s e e t h a t t h e u t i l i t i e s were e s s e n t i a l t o complete b o l t i q g t h e u n i t t o g e t h e r , f i x i n g t h e cabinet support around t h e dishwasher, hanging and i n s t a l l i n g t h e l i g h t f i x t u r e s i n t h e dining room and master bathroom, properly i n s t a l l i n g t h e smoke d e t e c t o r , r e p l a c i n g a damaged dining room t a b l e , assembling t h e china c l o s e t s h e l v e s , firmly a t t a c h i n g t h e f r o n t c l o s e t s h e l f , and providing a usable and properly vented furnace.

The record a l s o supports t h e d i s t r i c t c o u r t ' s f i n d i n g t h a t t h e r e was a s u b s t a n t i a l f a i l u r e of c o n s i d e r a t i o n promised by Alcorn. Comptons s o l d t h e i r family home i n Great F a l l s , Montana Then, a f t e r r e c o n c i l i a t i o n ,

a s a r e s u l t of m a r i t a l problems.

t h e family moved i n t o a small t h r e e room house i n Vaughn, Montana, i n which M r . Compton had been l i v i n g , u n t i l adequate housing was found. Alcorn was made aware of t h i s s i t u a t i o n and t h e primary

o b j e c t of t h e Comptons was t o purchase a new

-mobile

home t o

provide r e a d i l y a v a i l a b l e housing f o r them and t h e i r t h r e e c h i l d r e n . Expert witness testimony from t h e c i t y of Great F a l l s mechanical i n s p e c t o r was t h a t t h e furnace lacked proper v e n t i n g , was dangerous t o use and a s such v i o l a t e d s e c t i o n s 69-2122 and 69-2123, R.C.M. 1947, which adopts n a t i o n a l c o n s t r u c t i o n standards

f o r mobile homes issued by United S t a t e s of America Standards Institute. He a l s o t e s t i f i e d t h e mobile home v i o l a t e d t h e s e

standards f o r i t s f a i l u r e t o have another smoke d e t e c t o r i n t h e h a l l leading t o t h e two bedrooms a t t h e opposite end of t h e home from t h e master bedroom. This evidence combined w i t h t h e o t h e r

d e f e c t s s u b s t a n t i a t e s t h e d i s t r i c t c o u r t ' s f i n d i n g t h e r e was a s u b s t a n t i a l f a i l u r e of c o n s i d e r a t i o n promised by t h e s e l l e r Alcorn. Alcorn next a l l e g e s t h e d i s t r i c t c o u r t abused i t s d i s c r e t i o n i n allowing r e s c i s s i o n of t h e c o n t r a c t . It i s n o t t h e duty

of t h i s Court t o determine whether we agree with t h e d i s t r i c t c o u r t ' s conclusions, i f supported by t h e evidence and t h e law. Stromberg and Brown v. Seaton Ranch Co., 41. 160 Mont. 293, 502 P.2d

The d i s t r i c t c o u r t concluded t h a t t h e p a r t i a l breach was

s o s u b s t a n t i a l and fundamental a s t o d e f e a t t h e o b j e c t of t h e p a r t i e s i n making t h e agreement, and t h a t t h e Comptons d i d a l l t h a t was necessary t o e f f e c t u a t e r e s c i s s i o n . This i s a c o r r e c t

statement of t h e law allowing r e s c i s s i o n of a c o n t r a c t f o r p a r t i a l breach, 1012. Johnson v. Meiers, 118 Mont. 258, 164 P.2d

Furthermore, t h e r e i s evidence t o support t h a t conclusion. The l a s t i s s u e concerns t h e award of a t t o r n e y f e e s t o

Comptons.

The c o n t r a c t d i d p r ~ v i d e t t o r n e y f e e s t o t h e h o l d e r a

of t h e c o n t r a c t , should such holder b r i n g a d e f a u l t a c t i o n on the contract. Section 93-8601.1, R.C.M. 1947, provides a

reciprocal r i g h t . t o attorney fees t o a l l p a r t i e s t o the contract i n any a c t i o n on t h e c o n t r a c t . of s e c t i o n 93-8601.1, R.C.M. W r e j e c t Alcorn's i n t e r p r e t a t i o n e

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1947, t h a t t h e r e c i p r o c a l r i g h t t o

a t t o r n e y f e e s e x i s t s on'ly when t h e p a r t y who has t h e r i g h t t o a t t o r n e y f e e s under t h e c o n t r a c t i n s t i t u t e s t h e a c t i o n . reading of t h e s e c t i o n d i s p l a y s t h e i n c o r r e c t n e s s of pretation: "Whenever by v i r t u e of t h e provisions of any c o n t r a c t o r o b l i g a t i o n i n t h e n a t u r e of a cont r a c t , made and entered i n t o a f t e r t h e e f f e c t i v e d a t e of t h i s a c t , one p a r t y t o such c o n t r a c t o r o b l i g a t i o n has an express r i g h t t o recover a t t o r n e y f e e s from any o t h e r p a r t y t o t h e c o n t r a c t i n t h e event t h e p a r t y having t h a t r i g h t s h a l l b r i n g an a c t i o n upon t h e c o n t r a c t o r o b l i g a t i o n , then i n any a c t i o n on such c o n t r a c t o r o b l i g a t i o n a l l p a r t i e s t o t h e c o n t r a c t o r o b l i g a t i o n s h a l l be deemed t o have t h e same r i g h t t o recover a t t o r n e y f e e s , and t h e p r e v a i l i n g p a r t y i n any such a c t i o n , whether by v i r t u e of t h e express c o n t r a c t u a l r i g h t , o r by v i r t u e of t h i s a c t , s h a l l be e n t i t l e d t o recover h i s reasonable a t t o r n e y f e e s from t h e l o s i n g p a r t y p a r t i e s . " (Emphasis supplied.)
A

that inter-

-

S e l l e r Alcorn i s c o r r e c t i n h i s contention t h a t evidence
i s required t o be introduced a t t r i a l t o allow an award of a t t o r n e y

fees t o e i t h e r party. poration, Mont

Crncevich v. Georgetown Recreation Cor-

.

, 541

P.2d 56, 32 S t . Rep. 963.

How-

e v e r , such evidence was introduced when t h e d i s t r i c t c o u r t on motion of Comptons, allowed t h e c a s e t o be reopened a f t e r a motion t o amend t h e f i n d i n g s and conclusions by t h e s e l l e r Alcorn,

Alcorn contends t h e motion of Comptons was one governed by Rules 52 and 59, M.R.Civ.P., and a s such was n o t made w i t h i n

t h e t i m e allowed under those r u l e s , and t h a t t h e c o u r t l o s t j u r i s d i c t i o n t o e n t e r t a i n t h e motion pursuant t o those r u l e s . These r u l e s govern motions t o amend t h e d i s t r i c t c o u r t ' s f i n d i n g s and motions f o r a new t r i a l , r e s p e c t i v e l y . Comptons made n e i t h e r .

What they d i d was move t h e d i s t r i c t c o u r t t o reopen t h e c a s e f o r taking f u r t h e r testimony; they d i d n o t want t h e f i n d i n g s and conclusions a l t e r e d .
It i s well s e t t l e d t h a t t h e r u l i n g upon a motion t o reopen

a c a s e f o r taking f u r t h e r testimony i s w i t h i n t h e sound d i s c r e t i o n of t h e d i s t r i c t c o u r t , which w i l l only be reversed on appeal f o r manifest abuse of t h a t d i s c r e t i o n . G i l c r e s t v. Bowen, 95

Mont. 44, 24 P.2d 141; Nadeau v. The Texas Company, 104 Mont. 558, 69 P.2d 586; Kipp v. Wong, 163 Mont. 476, 517 P.2d 897. The testimony .as t o a t t o r n e y f e e s was o f f e r e d t o support an a f f i d a v i t previously f i l e d during t h e t r i a l , a p r a c t i c e accepted by t h i s p a r t i c u l a r d i s t r i c t c o u r t p r i o r t o Crncevich. Also a more a c c u r a t e account of t h e time spent on t h e c a s e by Comptons' a t t o r n e y , up t o and including motions t o amend t h e f i n d i n g s of f a c t and conclusions of law, could be provided a t t h i s time. W f i n d no manifest abuse of t h e d i s t r i c t c o u r t ' s e

d i s c r e t i o n i n reopening t h e . x a s e t o allow t h i s testimony under t h e s e circumstances. The j udgmen t

W Concur: e

on. Jack L. Green, D i s t r i c t f l u d g e, sitting for Justice Wesley C a s t l e s .

Q_//Lt

Mr.,Justice Gene B. Daly dissenting:

I dissent.
I do not agree with the fault assigned in the factual
recitation by the majority opinion. The purchasers had im-

properly prepared the site for such a large building and thereafter many problems did occur on both sides of the agreement.

I fail to find any breach by the seller of such a substantial
and fundamental nature as to defeat the object of the parties to the contract.

I further find, in any event, the purchasers did not
proceed lproperly to effectuate a rescission. I further feel the reopening of the case for further testimony was a manifest abuse of discretion. The cause should be reversed and remanded 7 , , for a new trial. /,'
* ',

f

/

-" Justice.



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