Turbiville v. Hansen

761 P.2d 389, 233 Mont. 487, 1988 Mont. LEXIS 266
CourtMontana Supreme Court
DecidedSeptember 6, 1988
Docket88-088
StatusPublished
Cited by3 cases

This text of 761 P.2d 389 (Turbiville v. Hansen) is published on Counsel Stack Legal Research, covering Montana Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Turbiville v. Hansen, 761 P.2d 389, 233 Mont. 487, 1988 Mont. LEXIS 266 (Mo. 1988).

Opinions

MR. JUSTICE WEBER

delivered the Opinion of the Court.

This is an action for damages arising from the termination of Ms. Turbiville’s contractual interest in a nightclub and restaurant on the Montana-North Dakota state line. The District Court for the Fifteenth Judicial District, Roosevelt County, granted summary judgment to defendant First National Bank and Trust Co. (Bank). Ms. Turbiville appeals. We affirm.

The issue is whether the lower court erred in granting the Bank summary judgment.

In June of 1982, Ms. Turbiville entered into an agreement to purchase the State Line Club (Club) from defendants Hansen. Ms. Turbiville paid $95,000 as a down payment and signed a contract for deed for the balance. The Bank was the escrow agent.

In 1983, Ms. Turbiville entered negotiations to sell the Club to defendant Mr. Graf, a Canadian citizen. Under their agreement, Mr. Graf took possession of the Club in June but the final closing of the sale would not take place until July 31. The closing did not take place on that date, but instead was postponed several times.

On August 10, 1983, the Hansens, through their attorney, issued a notice of default alleging violation of paragraph XII of the contract for deed, in which Ms. Turbiville had agreed to maintain the Club’s bar and liquor licenses in good standing:

“Until final payment hereunder, Purchaser agrees to keep and maintain said liquor and beer licenses to be acquired hereunder in full force and effect and to commit no act or failure to act which might result in the loss of said licenses. Purchaser also agrees until final payment hereunder to keep the cocktail lounge on said premises operating during the legal operating hours of licensed liquor establishments, and to comply with all of the laws of the State of Montana, pertaining to the operation of retail liquor establishments. Any failure to fulfill the covenants of this paragraph shall be considered a default under the terms of article III of this contract.”

[489]*489The problem, of which Ms. Turbiville was aware, was a question on the part of the Montana Department of Revenue about continuation of the Club’s state liquor license, because Mr. Graf is a Canadian citizen. The notice of default stated, in relevant part:

“[Y]ou have committed acts and have failed to act in such a manner that the liquor and beer license might be lost and/or terminated by the Montana Department of Revenue, Liquor Division. You have further failed to comply with all of the laws of the State of Montana pertaining to the operation of a retail liquor establishment. The specific acts or omissions and other violations have been reported to Erling and Avis Hansen through the undersigned by Mr. Mike Otterberg, who is an investigator for the Legal Enforcement Division of the Montana Department of Revenue.”

On October 12, 1983, the Hansens and their attorney went to the Bank and requested that the escrow be closed and all documents be returned to them. They presented the escrow officer with a copy of the default notice which had been sent to Ms. Turbiville. They also presented the escrow officer with an “Affidavit to Close Escrow” stating:

“We, Erling Hansen and Avis Hansen, after being duly sworn upon oath, state:

“1. That we are the parties who entered into that certain Contract for Deed and Conditional Sales Contract with Sharon Turbiville dated the 1st day of June, 1982.

“2. That on the 10th day of August, 1983, a Notice of Default was sent to Sharon Turbiville at Bainville, Montana.

“3. That a true and correct copy of said Notice of Default is attached hereto.

“4. That the sixty (60) day grace period has expired without said default having been cured and that we have elected to cancel this contract.

(Dated and signed.)”

The escrow officer copied the documents in the escrow file and gave the originals to the Hansens.

Ms. Turbiville brought this action alleging that when the contract for deed was canceled she lost all the money she had paid on the Hansen contract, along with other damages. Her claim against the Bank alleged that the Bank breached a fiduciary duty owed to her when it delivered the documents in the escrow account to the Han-sens without contacting her. The complaint alleged that “ [a] reasonable and prudent businessman would have some doubt that a breach [490]*490existed according to the terms of the notice of default when Alfred Graf and his attorney were present when the escrow account was turned over.” (The allegation that Mr. Graf and his attorney were present is not supported by the depositions.)

The Bank moved for, and was granted, summary judgment prior to trial. Ms. Turbiville settled with the other defendants. Then she asked the court to reconsider the order granting summary judgment to the Bank. The court reaffirmed its order and Ms. Turbiville appeals.

Did the lower court err in granting the Bank summary judgment?

Rule 56, M.R.Civ.P., allows a district court to enter summary judgment when the pleadings, depositions, and other documents on file with the court demonstrate no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. This Court’s review of a summary judgment is based on its examination of the entire case. Shimsky v. Valley Credit Union (Mont. 1984), 208 Mont. 186, 676 P.2d 1308, 1310, 41 St.Rep. 258, 260.

Ms. Turbiville’s argument on appeal is that there were disputed issues of material fact and that the Bank was not entitled to judgment as a matter of law. She argues that summary judgment for the Bank was not proper because 1) the contract required an actual default, not just a claimed one, before the escrow documents could be returned to the Hansens, 2) both the liquor license provision in the contract for deed and the default notice sent to her are void for vagueness, 3) it would have been impossible for her to cure the default within the time allowed because the Department of Revenue had not set hearing on the alleged liquor license violation until November 14, 1983, and 4) the affidavit requesting closure of the escrow was insufficient on its face because it did not clarify whether notice was provided to her in accordance with the terms of the contract.

The escrow agreement signed by the Bank, Ms. Turbiville, and the Hansens provided, in relevant part:

“4. If the purchaser, or her personal representatives, heirs or assigns, shall default in making payment as agreed, or shall otherwise default in the performance of the provisions of the contract for deed, then the seller, their personal representatives, heirs or assigns upon demand shall be entitled to the immediate return from the escrow agent of the contract for deed, warranty deeds and abstracts, so that they may pursue such remedies as provided by law for the foreclosure of the contract for deed.

[491]*491“9. The escrow agent shall be liable only to account for the money received by it and for the delivery of the instruments and documents escrowed in accordance with the terms of this agreement.”

In this case we conclude that the only obligation of the escrow holder was to adhere strictly to the instructions as provided in the escrow agreement. See First Fidelity Bank v. Matthews (Mont. 1984), [214 Mont.

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Cite This Page — Counsel Stack

Bluebook (online)
761 P.2d 389, 233 Mont. 487, 1988 Mont. LEXIS 266, Counsel Stack Legal Research, https://law.counselstack.com/opinion/turbiville-v-hansen-mont-1988.