No. 13313
IN TEE SUPREME COURT OF THE STATE OF MONTANA
1977
LAWRENCE E. O'NEIL, CHARLES H. O'NEIL
and WYNONA M. O'NEIL,
Plaintiffs and Respondents,
JOHN 2. LIPINSKI and ANN LIPINSKI,
Defendants and Appellants.
Appeal from: District Court of the Eleventh Judicial District,
Honorable Robert C. Sykes, Judge presiding.
Counsel of Record:
For Appellants:
Hash, Jellison and O'Brien, Kalispell, Montana
M. Dean Jellison argued, Kalispell, Montana
For Respondents:
Warden, Walterskirchen and Christiansen, Kalispell,
Montana
William C. Walterskirchen argued, Kalispell,
Montana
Submitted: May 4, 1977
Decided : tjuf 1$
,jf-: ;,
Filed:
Clerk
M r . J u s t i c e John Conway H a r r i s o n d e l i v e r e d t h e Opinion of t h e
Court.
T h i s i s a n appeal by defendants L i p i n s k i from a judgment
of t h e d i s t r i c t c o u r t , Flathead County, f o r p l a i n t i f f s 0 ' ~ e i l
g r a n t i n g s p e c i f i c performance of an agreement t o r e p a i r an
i r r i g a t i o n dam and t o r e p l a c e c e r t a i n pipe.
L i p i n s k i p r e s e n t s t h r e e i s s u e s on appeal:
I. bfiether s p e c i f i c performance of a c o n t r a c t should b e
g r a n t e d where a l l e g e d unreasonable d e l a y by p l a i n t i f f r e n d e r s
t i m e l y performance of t h i s c o n t r a c t impossible and d e f e a t s t h e
primary c o n s i d e r a t i o n f o r t h e c o n t r a c t ?
2. Whether p l a i n t i f f had an adequate remedy a t law?
3. Whether s p e c i f i c performance i s a n adequate remedy t o
compel performance of a c o n s t r u c t i o n c o n t r a c t ?
P l a i n t i f f 0 ' N e i l owns a g r i c u l t u r a l land i n Flathead County
i r r i g a t e d by t h e waters of Ashley Creek. I n a d d i t i o n , he owns
a w a t e r r i g h t and a d i t c h r i g h t over and a c r o s s l a n d s purchased
by defendant L i p i n s k i . O ' N e i l ' s water i s d i v e r t e d by a c o n c r e t e
dam and c o n c r e t e p i p e s over land L i p i n s k i purchased.
Following t h e purchase of t h e p r o p e r t y by L i p i n s k i a d i s p u t e
a r o s e between t h e p a r t i e s and L i p i n s k i denied OINeil a c c e s s t o
t h e dam and a l l e g e d O'Neil d i d n o t own e i t h e r t h e water r i g h t
o r t h e d i t c h r i g h t . O'Neil f i l e d s u i t i n 1968 a g a i n s t L i p i n s k i
seeking t o e s t a b l i s h h i s water r i g h t , d i t c h r i g h t and t o recover
$7,415.05 f o r damages caused by L i p i n s k i ' s d e n i a l of w a t e r and
$5,000.00 punative damages. That c a s e was s e t t l e d on t h e >day
s e t ,for t r i a l . S t i p u l a t e d f i n d i n g s of f a c t s and conclusions of
law were e n t e r e d and signed by a l l p a r t i e s and a judgment e n t e r e d .
A t t h e same time, June 16, 1969, t h e memorandum agreement involved
i n t h e i n s t a n t c a s e was e n t e r e d i n t o between t h e p a r t i e s .
That agreement, among o t h e r t h i n g s , s e t t l e d O ' N e i l ' s
c l a i m f o r damages a g a i n s t L i p i n s k i and s e t up t h e method and
manner of r e p a i r i n g t h e dam and t h e d i s t r i b u t i o n l i n e s . It
provided O f N e i l was t o s e e and approve t h e p l a n s and s p e c i f i c a -
t i o n s , and t h e p r o j e c t was t o be completed by December 10,
1969. On November 21, 1969, L i p i n s k i discharged h i s counsel
and o b t a i n e d new counsel who advised O'Neil t h a t L i p i n s k i r e f u s e d
t o comply w i t h t h e agreement.
The c o u r t found according t o t h e agreement t h a t (1) L i p i n s k i
d e s i r e d t o have a l l of t h e p i p e l i n e underground, (2) L i p i n s k i
was t o have f u l l c o n t r o l and s u p e r v i s i o n o f t h e r e p a i r p r o j e c t ,
s u b j e c t t o O'Neilt s approval o f t h e p l a n s and s p e c i f i c a t i o n s ,
(3) on June 16, 1969 LZpinski employed a n engineering f i r m t o
draw up such p l a n s b u t t h e f i r m f a i l e d t o do s o , (4) on August
1 5 , 1969 a n o t h e r e n g i n e e r was employed who submitted p l a n s and
s p e c i f i c a t i o n s t o O ' N e i l ' s a t t o r n e y on August 26, 1969, (5) t h e s e
were submitted t o O ' N e i l t s engineer on o r about September 19, 1969,
and a f t e r a conference c e r t a i n changes were proposed, and (6)
t h a t t h e s e changes were i n c o r p o r a t e d i n t o t h e p l a n s by L i p i n s k i ' s
e n g i n e e r and resubmitted t o O'Neil who r e q u e s t e d n i n e f u r t h e r
changes. On November 21, 1969, L i p i n s k i discharged h i s a t t o r n e y
and e n g i n e e r and terminated t h e agreement.'
The c o u r t f u r t h e r found t h e n i n e changes were a l l i n
accord w i t h accepted e n g i n e e r i n g p r a c t i c e s , save and except t h e
r e q u i r i n g of a lowering o f t h e i n t a k e e n t r y 12 inches below t h e
s p i l l w a y s l a b and t h e requirement of 12 r a t h e r than 6 inches of
fill. These l a t t e r two requirements were found t o be s u b s t a n t i a l
and unreasonable b u t t h e o t h e r 7 were reasonable. I n addition,
t h e c o u r t found t h a t had t h e work been done i n 1969, t h e c o s t would
have been approximately $9,000 and a t t h e time of t h i s t r i a l i n
1975, t h e c o s t had i n c r e a s e d t o $19,710.00. The t r i a l c o u r t
found a breach o f t h e agreement by L i p i n s k i and ordered t h e
r e p a i r s be made, e x c e p t i n g t h e two above r e f e r r e d t o e x c e p t i o n s
by December 1, 1976. L i p i n s k i a p p e a l s from t h a t judgment.
During t h e p e r i o d from December 1969 t o t h e t r i a l on
December 26, 1975, c e r t a i n n e g o t i a t i o n s took p l a c e between
counsel and on September 20, 1974, by agreement o f t h e p a r t i e s ,
t h e c o u r t appointed Douglas Daniels a s a s p e c i a l master and he
submitted a r e p o r t t o t h e c o u r t and t e s t i f i e d a t t h e t r i a l .
I s s u e 1. W n o t e a p p e l l a n t argues t h a t he was excused
e
from performing because d e l a y s by respondent prevented work
completion by December 10, 1969. W f i n d no m e r i t t o t h i s
e
argument. The s e t t l e m e n t agreement was signed on June 1 6 , no
e n g i n e e r was h i r e d by a p p e l l a n t u n t i l August 15; t h e r e v i s e d
p l a n o f a p p e l l a n t ' s engineer Marquardt was n o t given t o respondent
u n t i l October 15 and t h a t p l a n was n o t i n accord w i t h accepted
engineering p r a c t i c e s . Respondent's e n g i n e e r Wiedenman had
h i s r e v i s e d p l a n b e f o r e a p p e l l a n t by October 28, b u t he d i d
n o t respond u n t i l November 21 when h i s new a t t o r n e y n o t i f i e d
respondent t h e agreement would n o t be performed. W note
e
Marquardt t e s t i f i e d i f h i s Plan B , d a t e d October 1 5 , had been
immediately approved he could n o t have met t h e December 10
deadline. Obviously, t h e recommended changes of Wiedenman
would have extended t h a t d a t e . Marquardt was n o t i f i e d by
a p p e l l a n t t o c e a s e work on November 6. The record speaks f o r
itself. I f anyone i s t o be charged w i t h d e l a y , i t i s a p p e l l a n t
n o t respondent. L i p i n s k i a t t r i a l on cross-examination r e v e a l e d
h i s r e a l reason when he s a i d : 'I* ** i n h i n d s i g h t t h a t was a
poor d e c i s i o n because I wouldn't do i t today, make t h a t agree-
ment * Jc Jc."
I s s u e 2. Did respondent have an adequate remedy a t law
and t h e r e f o r e i s n o t e n t i t l e d t o e q u i t a b l e r e l i e f ? Appellant
argues t h a t respondent's l e g a l remedy i s o f such a c h a r a c t e r
a s t o p r e c l u d e r e l i e f by way o f s p e c i f i c performance. In
support he c i t e s P h i l b r i c k v. American Bank and T r u s t Co., 58
Mont. 376, 193 P. 59; J e f f r i e s Coal Co. v. I n d u s t r i a l Acc~Board
126 Mont. 411, 252 P.2d 1046, b u t t h e s e c a s e s a r e n o t a p p l i c a b l e
factually. He argues h e wrote respondent a l e t t e r a u t h o r i z i n g
the
him t o proceed w i t h t h e work and t h a t t h e c o s t s of doing/work would
be t h e same i f one o r t h e o t h e r d i d i t .
However, a s noted i n 7 1 Am.Jur.2dY S p e c i f i c Performance 59:
"* * 2k I t i s c l e a r , however, t h a t t h e mere f a c t t h a t a
p a r t y can a v a i l . h i m s e l f of some r e l i e f a t law does n o t
p r e c l u d e o r d e f e a t t h e j u r i s d i c t i o n of e q u i t y t o d e c r e e
s p e c i f i c performance. * * *"
Such i s t h e c a s e h e r e where t h e t r i a l c o u r t found respondent
had no p l a i n , speedy o r adequate remedy a t law. This i s t h e
second law s u i t over t h e water and d i t c h r i g h t s and some 8
y e a r s have passed t o t h e detriment of respondent. The-court
h e r e :was "eonfronted w i t h a m u l t i p l i c i t y of s u i t s , t h e f a c t s i t u a -
t i o n i s unique,so t h e c o u r t p r o p e r l y e x e r c i s e d i t s e q u i t a b l e
powers. I n t h e s e t t l e m e n t agreement o f 1969 L i p i n s k i i n s i s t e d
on having a b s o l u t e c o n t r o l and management of t h e r e p a i r s and
i n s t a l l a t i o n because i t was on h i s p r o p e r t y . I n t h e years leading
up t o 1969, he had t h r e a t e n e d t o r e s t r a i n O'Neil from coming onto
h i s p r o p e r t y t o make r e p a i r s and had ordered workmen o f f t h e
property. The t r i a l c o u r t g r a n t e d h i s demands i n t h e 1969
agreement and i n i t s e f f o r t s t o avoid continued l i t i g a t i o n t h e
c o u r t had a u t h o r i t y t o g r a n t t h e e q u i t a b l e r e l i e f h e r e . W find
e
no e r r o r .
I s s u e 3. The f i n a l i s s u e q u e s t i o n s whether s p e c i f i c
performance i s an a v a i l a b l e remedy t o e n f o r c e a c o n s t r u c t i o n
contract. To support h i s p o s i t i o n a p p e l l a n t c i t e s Lubin v .
Lubin, 144 C.A.'2d'781, 302 P.2d 49 and Moklofsky v. Moklofsky,
79 C.A.2d 259, 179 P.2d 628. These c a s e s a r e n o t on p o i n t and
can be d i s t i n g u i s h e d . Lubin i s a p r o p e r t y s e t t l e m e n t i n a
d i v o r c e a c t i o n and h a s nothing t o do w i t h a c o n s t r u c t i o n c o n t r a c t .
Moklofsky d e a l s w i t h an agreement t o c o n s t r u c t an o u t s i d e s t a i r -
c a s e , b u t t h i s was n o t t h e c o n t r o l l i n g i s s u e i n t h e c a s e .
Here, t h e c o u r t d i d n o t g r a n t s p e c i f i c performance n o r
d i d t h e complaint, a s k f o r i t . The c o u r t ordered L i p i n s k i t o
r e p a i r and r e p l a c e t h e dam and p i p e l i n e i n accord w i t h t h e p l a n s
o r i n t h e a l t e r n a t i v e , i f he f a i l e d t o do so w i t h i n a s p e c i f i c
time, 0 ' ~ e i l
could do t h e work under t h e s u p e r v i s i o n 6f a n e n g i n e e r
appointed by t h e c o u r t and he would have judgment f o r t h e c o s t s .
Contrary t o L i p i n s k i ' s p o s i t i o n , t h e c o u r t could have ordered
f u l l and complete s p e c i f i c performance of t h e c o n s t r u c t i o n c o n t r a c t .
While t h e r e a r e d i v e r s e views on t h e s p e c i f i c performance of
c o n s t r u c t i o n c o n t r a c t s , we f i n d and adopt t h e p o s i t i o n taken by
t h e Massachusetts Court i n Jones v. P a r k e r , 163 Mass. 564, 40
N.E. 1044,1045, where M r . J u s t i c e Holmes s t a t e d :
"There i s no u n i v e r s a l r u l e t h a t c o u r t s of e q u i t y
never w i l l e n f o r c e a c o n t r a c t which r e q u i r e s some
b u i l d i n g t o b e done. They have enforced such con-
t r a c t s from t h e e a r l i e s t days t o t h e p r e s e n t time."
That;view was adopted i n a more r e c e n t c a s e , Grayson-Robinson
S t o r e s , I n c . v . I r i s Const. Corp., 8 N.Y.2d 133, 202 N.Y.Supp.2d
303, 168 N.E.2d 377,379. There t h e c o u r t i n reviewing t h e problem
of s p e c i f i c performance of c o n s t r u c t i o n c o n t r a c t s s a i d :
"Tbere i s of c o u r s e , an o l d t r a d i t i o n o r
approach according t o which c o u r t s have been
r e l u c t a n t t o e n f o r c e ' C o n t r a c t s which r e q u i r e t h e
performance of v a r i e d and continuous a c t s , o r t h e
e x e r c i s e of s p e c i a l s k i l l , t a s t e , and judgment'
because 1 t h e e x e c u t i o n o f t h e d e c r e e would r e q u i r e
such c o n s t a n t superintendence a s t o make j u d i c i a l
c o n t r o l a m a t t e r of extreme d i f f i c u l t y ' . Standard
Fashion Co. v. Siegel-Cooper Co., 157 N.Y. 60,66,
5 1 N.E. 408,409, 43 L.R.A. 854. I n some i n s t a n c e s
c o u r t s o f e q u i t y i n o t h e r S t a t e s have f o r some such
reasons r e f u s e d t o o r d e r s p e c i f i c performance of
b u i l d i n g c o n t r a c t s . [ C i t i n g c a s e s ] Other c o u r t s o f
e q u i t y have gone t h e o t h e r way ( s e e Jones v. P a r k e r ,
163 Mass. 564, 40 N.E. 1044, which a l s o was a c o n t r a c t
t o b u i l d f o r a l e s s e e ) . 'There i s no u n i v e r s a l r u l e
t h a t c o u r t s o f e q u i t y never w i l l e n f o r c e a c o n t r a c t
which r e q u i r e s some b u i l d i n g t o be done. They have
enforced such c o n t r a c t s from t h e e a r l i e s t days t o t h e
p r e s e n t time' (Jones v . P a r k e r , s u p r a , 163 Mass. a t
page 567, 40 N.E. a t page 1045). On v a r y i n g f a c t s o u r
New York d e c i s i o n s t a k e one o r t h e o t h e r p o s i t i o n .
[ C i t i n g c a s e s ] . Modern w r i t e r s t h i n k t h a t t h e ' d i f f i -
c u l t y of enforcement' i d e a i s exaggerated and t h a t t h e
t r e n d i s toward s p e c i f i c performance (5 Corbin, C o n t r a c t s
[ I 9 5 1 e d . ] , 5 1172; 5 W i l l i s t o n , C o n t r a c t s [ r e v . e d . ] ,
p. 3977; Restatement, C o n t r a c t s , 5 371, comment a ) .
C l e a r l y t h e r e i s no binding r u l e t h a t d e p r i v e s e q u i t y
of j u r i s d i c t i o n t o o r d e r s p e c i f i c performance of a
b u i l d i n g c o n t r a c t . A t most t h e r e i s d i s c r e t i o n i n t h e
c o u r t t o r e f u s e such a decree. And h e r e we do n o t
even have an e q u i t y s u i t b u t a motion made a s of r i g h t
t o confirm a completely v a l i d a r b i t r a t i o n award con-
forming i n a l l r e s p e c t s t o t h e e x p r e s s c o n f e r r a l o f
a u t h o r i t y on t h e a r b i t r a t o r s and meeting a l l s t a t u t o r y
requirements f o r confirmation ** *.I1
While n o t r a i s e d a s an i s s u e on a p p e a l t h e s p l i t t i n g o f t h e
c o s t s over $9,000 was c l e a r l y e r r o r i n view of t h e r e c o r d and
must be r e v e r s e d . The t r i a l c o u r t i n i t s conclusion of law No. 7
found L i p i n s k i should pay t h e f i r s t $9,000 and t h a t t h e r e a f t e r t h e ,
two p a r t i e s would s h a r e a l l expenses over and above t h a t f i g u r e .
W f i n d t h e c o u r t e r r e d i n t h i s holding and d i r e c t a l l c o s t s be
e
paid by a p p e l l a n t i n t h e c o n s t r u c t i o n and i n s t a l l a t i o n of t h e
i r r i g a t i o n system a s proposed by t h e Marquardt p l a n s and s p e c i f i -
c a t i o n s , i n c o r p o r a t i n g i n same t h e recommended changes of Wiedenman
a s r e f e r r e d t o i n t h e f i n d i n g s o f f a c t and conclusions o f law
of t h e t r i a l court. To hold ~othenrcSiee would be t o p e n a l i z e respon-
d e n t O'Neil who d i d what he could t o g e t t h e 1969 agreement
c a r r i e d o u t i n 1969. He h a s been deprived o f t h e use of h i s
water f o r over 8 y e a r s , due t o l i t i g a t i o n and o b s t i n a n c e o f
appellant Lipinski.
The judgment o f t h e t r i a l c o u r t i s a f f i r m e d and t h e cause
remanded t o t h e t r i a l c o u r t w i t h d i r e c t i o n s t o c o r r e c t i t s
conclusion of law No. 7 i n accordance w i t h t h i s opinion.
I
W Concur:
e
Chief J u s t i c e