Voit v. Mertz

2014 MT 91N

• Court: Montana Supreme Court
• Decided: April 2, 2014
• Docket: 13-0443
• Status: Published

Opinion

April 2 2014

DA 13-0443

IN THE SUPREME COURT OF THE STATE OF MONTANA

2014 MT 91N

DAVID VOIT,

Plaintiff and Appellee,

v.

KARL C. and MARIA M. MERTZ,

Defendants and Appellants.

APPEAL FROM: District Court of the Fourth Judicial District, In and For the County of Mineral, Cause No. DV-11-53 Honorable Karen Townsend, Presiding Judge

COUNSEL OF RECORD:

For Appellant:

Karl C. Mertz, self-represented, Maria M. Mertz, self-represented; Long Beach, Mississippi; Galesburg, Illinois

For Appellee:

John D. Greef, Attorney at Law; Hamilton, Montana

Submitted on Briefs: March 5, 2014 Decided: April 2, 2014

Filed:

__________________________________________ Clerk Justice Michael E Wheat delivered the Opinion of the Court.

¶1 Pursuant to Section I, Paragraph 3(d), Montana Supreme Court Internal Operating

Rules, this case is decided by memorandum opinion and shall not be cited and does not serve

as precedent. Its case title, cause number, and disposition shall be included in this Court’s

quarterly list of noncitable cases published in the Pacific Reporter and Montana Reports.

¶2 Karl and Maria Mertz (together, the Mertzes) and David Voit (Voit) entered into a

written contract for the sale of real property in July of 2006. By the terms of the contract, the

Mertzes were to convey 4 acres to Voit from a 16.79 acre parcel located in Mineral County,

Montana. In consideration for that property, Voit was to convey a one acre parcel that he

owned in the Florida Keys, and pay the Mertzes $40,500. Voit eventually paid the Mertzes a

total of $38,500.

¶3 The Mertzes failed to obtain approval from Mineral County for the division of 4 acres

from their 16.79 acre parcel. Voit brought this action alleging breach of contract, illegal

contract, and specific performance. The District Court issued judgment in favor of Voit,

finding that the contract was void as impracticable because subdivision of the property was

illegal under state and county subdivision laws and regulations. The court awarded Voit

$38,500, plus interest and costs of suit. The Mertzes now appeal from the judgment on the

grounds that the District Court lacked jurisdiction over the contract, and that it erred when it

found that the contract was impracticable as a matter of law.

¶4 Although the Mertzes failed to raise this issue at the District Court level, lack of

subject matter jurisdiction may be raised at any time in a proceeding and cannot be waived.

State v. Osborne, 2005 MT 264, ¶¶ 15-16, 329 Mont. 95, 124 P.3d 1085. The Mertzes argue

2 that, since the contract was signed in Idaho, the courts and law of that state should govern.

“A contract is to be interpreted according to the law and usage of the place where it is to be

performed or, if it does not indicate a place of performance, according to the law and usage

of the place where it is made.” Section 28-3-102, MCA. “Real property within this state is

governed by the law of this state, except where the title is in the United States.”

Section 70-1-107, MCA.

¶5 Montana courts clearly have jurisdiction over the contract here. The contract

concerns a transaction for real property situated in Mineral County, Montana. Performance

of the contract, therefore, requires the transfer of real property in Montana. It is further

undisputed that the parcel of land is within the State and is not titled in the United States.

The law and courts of Montana, therefore, have jurisdiction over this contract for the

conveyance of real property.

¶6 Now turning to the contract itself, the object of a contract must be lawful when the

contract is made, and must be possible and ascertainable by the time the contract is to be

performed. Section 28-2-602, MCA. The object of a contract is the thing which it is agreed

on the part of the party receiving the consideration to do or not to do. Section 28-2-601,

MCA. Where a contract has but a single object and such object is unlawful, or wholly

impossible to perform, the entire contract is void. Section 28-2-603, MCA. Courts may

determine that performance is impossible when it is impractical, or can only be done at an

excessive, unreasonable and unbargained-for cost. Cape-France Enters. v. Estate of Peed,

2001 MT 139, ¶ 23, 305 Mont. 513, 29 P.3d 1011. A party’s prospective failure of

3 performance may . . . discharge the other party’s duties or allow him to suspend

performance . . . . Restatement (Second) of Contracts § 268 (1981).

¶7 The written contract here sought to convey 4 acres in Mineral County to Voit, and in

consideration for this property, the Mertzes would receive a sum of money and property in

Florida. The object of the contract, therefore, was the 4 acre property in Mineral County,

and Voit’s end of the bargain was payment of money and land in consideration for that

property. It is undisputed that the subdivision of that property is prohibited by state and

county regulations, and is unlawful. The court found that the subdivision of the land was

impracticable due to its illegality, and therefore, declared that the entire contract was void

under § 28-2-603, MCA. The Mertzes argue that they should not be held responsible for the

subdivision laws here, as they had agreed with Voit that they would jointly mount a

constitutional challenge to invalidate the subdivision laws. We see no evidence of this

agreement in the record. But even if that agreement was present in the record, the object of a

contract must be possible and ascertainable at the time the contract is to be performed.

Section 28-2-602, MCA. Had Voit completed his end of the bargain, the Mertzes could not

perform until some undisclosed, unascertainable time in the future when the challenge to

Mineral County’s subdivision laws had prevailed.

¶8 The Mertzes argue that the sole object of the contract was not illegal or impracticable

because Voit’s end of the bargain, a sum of money and land in Florida, was an object of the

contract and was not illegal or impracticable. But where a party has a prospective failure of

performance due to impracticability, the other party’s duties are discharged. Restatement

(Second) of Contracts § 268. Voit had paid all but a small sum of the purchase price, and

4 remained ready to convey title to the Florida property upon the subdivision of the Mineral

County property. Voit is not obligated to pay money and land in exchange for property

which he may or may not receive at an unascertainable future date.

¶9 The Mertzes make several other allegations and arguments tangential to their

relationship with Voit; that the court should have considered Voit’s deplorable moral

character; that the court failed to consider the various medical issues and deaths that hindered

the Mertzes in performance of the contract; that Voit had filed suit for the purpose of

clearing his title to the Florida property and obtaining financial security; and that Voit had

attempted to involve Karl Mertz in a criminal conspiracy to sabotage the competitors of

Voit’s employer. These allegations and arguments are irrelevant to the validity of the

contract, which is the only legal issue raised in the complaint and answers.

¶10 We have determined to decide this case pursuant to Section I, Paragraph 3(d) of our

Internal Operating Rules, which provides for noncitable memorandum opinions. The issues

in this case are legal and are controlled by settled Montana law, which the District Court

correctly interpreted and applied.

¶11 Affirmed. /S/ MICHAEL E WHEAT We Concur:

/S/ PATRICIA COTTER /S/ JIM RICE /S/ BETH BAKER /S/ LAURIE McKINNON