No. 81-246
IN THE SUPREME COURT OF THE STATE OF MONTANA
1981
I. J. HARES and IRMA HARES,
husband and wife,
Plaintiffs and Respondents,
RONALD W. NELSON,
Defendant and Appellant.
Appeal from: District Court of the Thirteenth Judicial District,
In and for the County of Carbon
Honorable William J. Speare, Judge presiding.
Counsel of Record:
For Appellant:
Sally M. Johnson, Red Lodge, Montana
For Respondents:
Joseph E. Mudd, Bridger, Montana
Submitted on briefs: July 30, 1981
Decided : M 2 3
V I$@
Filed: 2 5 1981
Mr. J u s t i c e Gene B . D a l y d e l i v e r e d t h e O p i n i o n of t h e C o u r t .
Defendant-appellant, Ronald Nelson, appeals from a
judgment e n t e r e d i n t h e T h i r t e e n t h J u d i c i a l D i s t r i c t C o u r t
of the State of Montana, Carbon County, the Honorable
William Speare p r e s i d i n g . T h i s judgment t e r m i n a t e d a con-
t r a c t f o r d e e d b e t w e e n t h e p l a i n t i f f s and t h e d e f e n d a n t d u e
t o defendant's default; granted p o s s e s s i o n of the property
subject of the contract to the plaintiffs; ordered the
defendant to sign all necessary documents to convey his
i n t e r e s t t o p l a i n t i f f s ; and awarded r e a s o n a b l e a t t o r n e y f e e s
i n t h e amount of $872.50 p l u s c o s t s t o t h e p l a i n t i f f s .
Plaintiffs, I. J. and Irma Hares, entered into a
contract for deed with the defendant, Ronald Nelson, on
December 29, 1 9 7 8 , whereby N e l s o n was t o p u r c h a s e 365 a c r e s
of land plus some buildings. The property, an old town
s i t e , i s l o c a t e d i n Carbon C o u n t y , Montana. After the s a l e ,
t h e Hares rented their r e s i d e n c e on t h i s p r o p e r t y . Other
r e n t e r s a l s o r e m a i n e d on t h e p r o p e r t y . The t o t a l p u r c h a s e
p r i c e was $ 9 2 , 7 5 0 , together with i n t e r e s t of 8 percent per
annum. N e l s o n was t o pay this i n monthly i n s t a l l m e n t s of
$1,000, with no downpayment, beginning April 1, 1 9 7 9 .
N e l s o n made p a y m e n t s A p r i l t h r o u g h O c t o b e r 1 9 7 9 .
No payment was made on November 1, 1 9 7 9 . The con-
t r a c t r e q u i r e d w r i t t e n n o t i c e s t o be g i v e n and t o be s e r v e d
upon the parties personally or by registered mail. The
address in the contract for Ronald Nelson was P. 0. Box
255323, S a c r a m e n t o , C a l i f o r n i a 95825.
The plaintiffs gave notice of default by mail and
a l s o t h r o u g h t h e Carbon County s h e r i f f . Within t h e f i f t e e n
d a y s a l l o w e d by c o n t r a c t t o c u r e t h e d e f a u l t , N e l s o n made
t h e $ 1 , 0 0 0 payment. However, he d i d n o t p a y t h e a t t o r n e y
f e e s r e q u e s t e d i n t h e n o t i c e and r e q u i r e d by t h e c o n t r a c t .
No f u r t h e r p a y m e n t s were made o n t h e c o n t r a c t . In
January 1980, Eric Brabec, a grandson of the Hares, at-
t e m p t e d t o g i v e N e l s o n a n a c c o u n t i n g and a c h e c k f o r r e n t a l s
collected from the buildings on the property. T h i s was
rejected by Nelson. A t the same time, Brabec informed
N e l s o n t h a t a d e f a u l t n o t i c e was w a i t i n g f o r him a t h i s p o s t
o f f i c e box i n Red Lodge, Montana. A n o t i c e of d e f a u l t was
also sent to the California address as required by the
contract. N e i t h e r n o t i c e was e v e r c l a i m e d .
The H a r e s t h e n d e c l a r e d t h e f u l l o u t s t a n d i n g b a l a n c e
on t h e c o n t r a c t d u e and p a y a b l e on F e b r u a r y 8 , 1 9 8 0 . A t no
t i m e d i d N e l s o n o f f e r t o make f u l l payment on t h e c o n t r a c t ;
h e o f f e r e d o n l y t h e amount i n a r r e a r s . The n o t i c e f o r t h e
b a l a n c e was a l s o m a i l e d b u t u n c l a i m e d .
No p a y m e n t s w e r e made t o c u r e t h e d e f a u l t . The H a r e s
b r o u g h t s u i t s e e k i n g t o compel N e l s o n t o e x e c u t e a l l n e c e s -
s a r y documents t o t e r m i n a t e h i s i n t e r e s t i n t h e c o n t r a c t f o r
deed.
N e l s o n a n s w e r e d and c o u n t e r c l a i m e d f o r a n i n j u n c t i o n
t o r e t a i n p o s s e s s i o n o f t h e p r o p e r t y p e n d i n g t h e outcome o f
the action, as well as for specific performance of the
contract. N e l s o n c o n t e n d e d t h a t a n o r a l a g r e e m e n t had b e e n
r e a c h e d by t h e p a r t i e s t o f o r e s t a l l p a y m e n t s on t h e c o n t r a c t
u n t i l a p r o p e r a c c o u n t i n g of t h e r e n t s r e c e i v a b l e from t h e
Hares and collected from other renters by the Hares on
b e h a l f o f N e l s o n was made.
Trial on t h i s matter was held June 2, 1980. The
D i s t r i c t Court found t h a t no a g r e e m e n t e x i s t e d t o p r e v e n t
foreclosure proceedings. The D i s t r i c t C o u r t e n t e r e d f i n d -
i n g s of f a c t and c o n c l u s i o n s o f l a w on J a n u a r y 1 6 , 1 9 8 1 . A
judgment i n accordance with s u c h f i n d i n g s and conclusions
was e n t e r e d on F e b r u a r y 3 , 1 9 8 1 .
The issues presented on appeal are:
1. Did the trial court err in declaring a forfei-
ture?
2. Did the trial court err in awarding attorney fees
to the respondents?
Appellant Nelson contends that this Court should
apply section 28-1-104, MCAI to prevent a forfeiture. That
section provides:
"Relief from forfeiture. Whenever by the
terms of an obligation a party thereto incurs
a forfeiture or a loss in the nature of a
forfeiture by reason of his failure to comply
with its provisions, he may be relieved
therefrom upon making full compensation to
the other party, except in case of a grossly
negligent, willful, or fraudulent breach of
duty. I'
Two important reasons exist for not applying section
28-1-104, MCA, in this instance. First, there is nothing in
the record to indicate that appellant ever complied with
section 28-1-104, MCA, by making full compensation to the
respondents. Second, appellant made no claim to the District
Court that section 28-1-104, MCA, was controlling. There-
fore, since this section was not addressed by the trial
court, this Court cannot review the application of the
statute or the issue presented by it on appeal. See Rules
8(c) and 12(b), M.R.Civ.P. In Chadwick v. Giberson (1980),
Mont. , 618 P.2d 1213, 1215, 37 St.Rep. 1723, 1726,
we held: "However, it is also a well-settled rule of law
that alleged error as to issues not raised in trial court
will not be considered on appeal." See also, State v.
Armstrong (1977), 172 Mont. 296, 562 P.2d 1129; Spencer v.
Robertson (1968), 151 Mont. 507, 445 P.2d 48; Clark v.
Worrall (1965), 146 Mont. 374, 406 P.2d 822.
The trial court did not err when it declared a for-
feiture and terminated the contract for deed. In Suburban
Homes Co. v . N o r t h ( 1 9 1 4 ) , 50 Mont. 1 0 8 , 1 1 7 , 1 4 5 P. 2, 5,
t h i s Court held:
" I f payment i s t o b e made i n i n s t a l l m e n t s ,
d e f a u l t i n t h e payment o f a n y i n s t a l l m e n t i s
a d i s t i n c t b r e a c h and g i v e s t h e vendor t h e
right to declare a forfeiture. The r i g h t
m u s t b e p r o m p t l y e x e r c i s e d , however; o t h e r -
wise, t h e r i g h t being e x c l u s i v e l y t h a t of t h e
p l a i n t i f f , h e w i l l be presumed t o r e g a r d t h e
c o n t r a c t a s s t i l l v a l i d and e x i s t e n t . "
T h i s r u l e was r e a f f i r m e d i n Hansen v . Transamerica I n s . Co.
( 1 9 7 8 ) , 1 7 5 Mont. 273, 573 P.2d 663. T h i s Court i n Suburban
Homes went on t o s a y :
"If t h e l a t t e r ( t h e vendee) continues i n
d e f a u l t , t h e v e n d o r , by demand f o r payment o f
t h e b a l a n c e o f t h e p u r c h a s e money and n o t i c e
of h i s p u rp o s e t o t e r m i n a t e t h e c o n t r a c t i n
c a s e o f f u r t h e r d e f a u l t , may p u t t h e v e n d e e
upon h i s g u a r d . I f a f t e r such n o t i c e he d o e s
n o t make payment w i t h i n a r e a s o n a b l e t i m e ,
t h e v e n d o r may d e c l a r e t h e c o n t r a c t a t a n
end." 1 4 5 P. a t 5 .
I n t h i s c a s e a p p e l l a n t d i d n o t make p a y m e n t s on t h e
c o n t r a c t f o r two m o n t h s . N o t i c e was s e n t by r e g i s t e r e d m a i l
t o h i s a d d r e s s a s p e r t h e t e r m s o f t h e c o n t r a c t and t o a Red
Lodge, Montana, a d d r e s s . Respondents s t r i c t l y complied w i t h
t h e d e f a u l t terms of t h e contract. The a p p e l l a n t d i d n o t .
A p p e l l a n t c o n t e n d s t h a t t h e r e a s o n he d i d n o t p a y a n y
a t t e n t i o n t o t h e n o t i c e s o f d e f a u l t was b e c a u s e h e t h o u g h t
a n o r a l c o n t r a c t f o r a n o f f s e t had been e n t e r e d i n t o b e t w e e n
himself and r e s p o n d e n t s . The a l l e g e d o r a l c o n t r a c t was t o
modify the written contract by allowing the appellant to
o f f s e t r e n t , owed t o him by r e s p o n d e n t s , a g a i n s t t h e m o n t h l y
p a y m e n t s t h a t were d u e on t h e c o n t r a c t f o r d e e d . However,
t h e t r i a l c o u r t f o u n d t h a t no s u c h o r a l c o n t r a c t was e n t e r e d
i n t o and t h a t a t b e s t t h e r e was m e r e l y a n a g r e e m e n t t o d i s -
c u s s some f o r m o f o f f s e t . F u r t h e r , u n d e r s e c t i o n 28-2-1602,
MCA, which provides that "[a] contract i n w r i t i n g may b e
altered by a contract i n writing or by an executed oral
agreement, and n o t o t h e r w i s e , " t h e r e could n o t have been a
proper modification of the written contract. Finally, the
only recourse available to the appellant after he had failed
to respond to the notices of default and forfeiture would
have been to tender full compensation to respondents. Sec-
tion 28-1-104, MCA. Appellant at no time offered to tender
full compensation; the best he offered was to tender the
payments owed.
The appellant argues that he did not receive effec-
tive notice according to the terms of the contract. The
contract states:
"It is further mutually agreed between the
parties hereto that any notice to be given
hereunder shall be served upon the parties
personally or by reqistered o certified mail
;
directed to the party or parties to be served
at their respective addresses as set forth,
to wit
"Buyer -- Ronald W. Nelson
P. 0 . Box 255323
Sacramento, California 98525"
(Emphasis added. )
Not only did respondents send notice to appellant at
the California address, but they also sent notice to his Red
Lodge, Montana, address. Further, Eric Brabec informed the
appellant that a notice of default was at the post office in
Red Lodge. Under the circumstances, the notice was suffi-
cient, and the fact that notice of an earlier default was
personally delivered does not mean that the mailed notices
were in any way defective under the terms of the contract.
Appellant's final contention is that the trial court
erred in awarding attorney fees to respondents.
The contract states:
"In the event of default of the Buyer, Buyer
agrees to reimburse the Seller, on demand,
for all costs and expenses of whatsoever
nature incurred by the Seller in enforcing
any of the provisions of this agreement,
including but not limited to, a reasonable
attorney's fee for attorneys employed by the
Seller in connection with the said default."
I t is c l e a r t h a t t h e c o n t r a c t f a i r l y provided f o r an
award o f a t t o r n e y f e e s i n t h e e v e n t o f a d e f a u l t . The t r i a l
c o u r t j u s t l y awarded t h e f e e s i n a c c o r d a n c e w i t h t h e t e r m s
of t h e contract.
The judgment o f t h e D i s t r i c t C o u r t i s a f f i r m e d .
/I
V
Justice
We concur: