No. 80-93
IN THE SUPREME COURT OF THE STATE OF MONTANA
1981
GORDON R. JULIAN,
Plaintiff and Respondent,
DEARL H. BUCKLEY, and BARBARA M.
BUCKLEY, husband and wife,
Defendants and Appellants.
Appeal from: District Court of the Eighteenth Judicial District,
In and for the County of Gallatin, The Honorable
W. W. Lessley, Judge presiding.
Counsel of Record:
For Appellants:
William L. Pepper, Bozeman, Montana
For Respondent:
Phillip N. Carter, Bozeman, Montana
Submitted on Briefs: November 26, 1980
Decided: JAN 2 8 1981
Filed: :fi!j 2 1981
Mr. 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.
Plaintiff-respondent brought t h i s a c t i o n t o recover
damages f o r b r e a c h of c o n t r a c t . Following a n o n j u r y t r i a l ,
t h e ~ i s t r i c C o u r t of t h e E i g h t e e n t h J u d i c i a l D i s t r i c t ,
t
all at in County, e n t e r e d judgment i n f a v o r of p l a i n t i f f .
Defendants-appellants f i l e d a motion f o r r e c o n s i d e r a t i o n and
l a t e r a motion t o a l t e r and amend t h e judgment. They t h e n
f i l e d a n o t i c e of a p p e a l . Thereafter t h e D i s t r i c t Court
amended i t s 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 of law on two
separate occasions. Respondent f i l e d a n o t i c e of a p p e a l ,
and a p p e l l a n t s f i l e d a n o t i c e of c r o s s - a p p e a l .
I n 1975 r e s p o n d e n t , a s b u y e r , and a p p e l l a n t s , a s s e l l e r s ,
e n t e r e d i n t o n e g o t i a t i o n s t o p u r c h a s e and s e l l a t r a c t of
land. These n e g o t i a t i o n s consummated i n t o a c o n t r a c t i n
which a p p e l l a n t s a g r e e d t o c o n s t r u c t a roadway from t h e
e x i s t i n g Bear Canyon Road t o t h e e a s t p r o p e r t y l i n e of t h e
t r a c t of l a n d r e s p o n d e n t w a s p u r c h a s i n g . The r o a d was t o be
a minimum of twenty f e e t wide and b e composed of a minimum
o f n i n e i n c h e s of p i t r u n g r a v e l , p r o p e r l y p l a c e d and com-
p a c t e d s o t h a t i t c o u l d b e used under a l l w e a t h e r c o n d i -
tions. The r o a d was t o b e completed by J u l y 1, 1976.
During 1976 and 1 9 7 8 a p p e l l a n t s h i r e d Kardash C o n s t r u c -
t i o n t o b u i l d t h e road. A p p e l l a n t s a l l e g e d t h a t i n 1976 s i x
i n c h e s of s h a l e m a t e r i a l w a s p l a c e d on t h e r o a d and a n
a d d i t i o n a l f o u r i n c h e s of m a t e r i a l w a s p l a c e d on t h e lower
one-half t o t w o - t h i r d s of t h e r o a d .
I n 1978, a f t e r b e i n g r e a s s u r e d r e p e a t e d l y by a p p e l l a n t s
t h a t t h e r o a d would be completed, r e s p o n d e n t began c o n s t r u c -
t i o n of h i s home on t h e p r o p e r t y . Respondent s e c u r e d a
c o n s t r u c t i o n l o a n of $ 5 4 , 5 0 0 from Bozeman F e d e r a l c r e d i t
union. On May 1 7 , 1978, r e s p o n d e n t s e c u r e d a commitment
l e t t e r from M e t r o p o l i t a n S e r v i c e Mortgage C o r p o r a t i o n .
M e t r o p o l i t a n a g r e e d t o l o a n r e s p o n d e n t t h e sum of $54,500 a t
9-3/4 p e r c e n t i n t e r e s t , r e p a y a b l e on a monthly b a s i s o v e r
t h i r t y years. T h i s commitment w a s c o n d i t i o n e d on t h e r o a d
b e i n g completed a c c o r d i n g t o t h e s p e c i f i c a t i o n s c o n t a i n e d i n
t h e c o n t r a c t and l e g a l a c c e s s b e i n g o b t a i n e d from t h e S t a t e
o f Montana. T h i s commitment e x p i r e d November 1 7 , 1978.
On F e b r u a r y 1, 1979, r e s p o n d e n t was r e q u i r e d t o l o a n t o
a p p e l l a n t s $232 b e f o r e t h e y would a g r e e t o s e c u r e t h e ease-
ments from t h e S t a t e of Montana.
On A p r i l 5, 1979, a n o t h e r commitment l e t t e r was o b t a i n e d
from M e t r o p o l i t a n , i n which M e t r o p o l i t a n a g a i n a g r e e d t o
l o a n r e s p o n d e n t $54,500. T h i s t i m e , however, t h e o n l y
c o n d i t i o n was t h a t t h e r o a d be completed a c c o r d i n g t o t h e
same s p e c i f i c a t i o n s c o n t a i n e d i n t h e c o n t r a c t . The l e g a l
a c c e s s problem had been r e s o l v e d when r e s p o n d e n t l o a n e d
a p p e l l a n t s t h e money s o t h e y , a p p e l l a n t s , would p u r c h a s e t h e
easements from t h e S t a t e of Montana. T h i s commitment l e t t e r
a l s o p r o v i d e d t h a t r e s p o n d e n t would have t o pay t h e c u r r e n t
i n t e r e s t r a t e , 11-1/2 p e r c e n t , and n o t 9-3/4 percent a s
agreed e a r l i e r . T h i s commitment l e t t e r e x p i r e d October 5,
1979.
A p p e l l a n t s r e f u s e d t o complete c o n s t r u c t i o n of t h e r o a d
and r e s p o n d e n t f i l e d s u i t . A n o n j u r y t r i a l was h e l d on
October 9, 1979. On November 6 , 1979, t h e ~ i s t r i c C o u r t
t
f i l e d i t s f i n d i n g s o f f a c t and c o n c l u s i o n s of law i n f a v o r
of r e s p o n d e n t . On November 8, 1979, judgment was s i g n e d .
A l s o on November 8, 1979, a p p e l l a n t s f i l e d t h e i r motion f o r
reconsideration and on November 9, 1979, f i l e d t h e i r motion
t o a l t e r o r amend t h e judgment. Both m o t i o n s a l l e g e d t h e
judgment and f i n d i n g s d i d n o t conform t o t h e e v i d e n c e . On
November 30, 1979, a p p e l l a n t s f i l e d t h e i r motion f o r a s t a y
of e x e c u t i o n . On December 3, 1979, a h e a r i n g was h e l d i n
D i s t r i c t C o u r t on a p p e l l a n t s ' motion t o a l t e r o r amend. On
December 4 , 1979, t h e D i s t r i c t C o u r t o r d e r e d a p p e l l a n t s n o t
t o s e l l o r i n any way encumber t h e i r r e a l p r o p e r t y . On
December 5 , 1979, a p p e l l a n t s f i l e d t h e i r f i r s t n o t i c e of
appeal. Thereafter, t h e following events occurred:
(1) December 6 , 1979, r e s p o n d e n t f i l e d a p e t i t i o n t o
have t h e D i s t r i c t C o u r t a p p o i n t a p p r a i s e r s .
(2) December 1 0 , 1979, t h e D i s t r i c t C o u r t amended i t s
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 of law f o r t h e f i r s t t i m e .
(3) December 1 3 , 1979, t h e D i s t r i c t C o u r t o r d e r e d a
s t a y of e x e c u t i o n and awarded a t t o r n e y f e e s t o r e s p o n d e n t .
(4) December 1 8 , 1979, a p p e l l a n t s f i l e d t h e i r s u p p l e -
m e n t a l motion t o a l t e r o r amend t h e 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 of l a w t o r e q u i r e r e s p o n d e n t t o u s e t h e damages
awarded him t o complete t h e r o a d .
(5) J a n u a r y 1 4 , 1980, t h e above motion was h e a r d and
t h e D i s t r i c t C o u r t o r d e r e d a n o t h e r h e a r i n g t o be h e l d on
F e b r u a r y 5, 1980.
(6) F e b r u a r y 5, 1980, a h e a r i n g w a s h e l d on above
motions and t h e D i s t r i c t C o u r t gave b o t h p a r t i e s twenty d a y s
t o submit b r i e f s .
(7) F e b r u a r y 26, 1980, t h e D i s t r i c t C o u r t amended i t s
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 of l a w f o r t h e second t i m e
and o r d e r e d r e s p o n d e n t t o p r e p a r e a judgment.
(8) March 21, 1980, r e s p o n d e n t f i l e d h i s n o t i c e of
a p p e a l and t h e r e a f t e r a p p e l l a n t s f i l e d t h e i r n o t i c e of
cross-appeal.
The first issue is whether the District Court had
jurisdiction to amend its findings of fact and conclusions
of law, make and enter orders affecting the rights of the
parties, and amend its original judgment after December 5,
1979, the date on which appellants' first notice of appeal
was filed.
Since 1954 it has been an established rule in Montana
that when a notice of appeal has been filed, jurisdiction
over the parties to the controversy and subject matter
passes from the District Court and vests in the Supreme
Court. It becomes the Supreme Court's duty to maintain the
status quo of the parties until the controversy can be
determined. Benolken v. Miracle (1954), 128 Mont. 262, 273
P.2d 667.
On November 8, 1979, appellants filed a motion for
reconsideration requesting that the court amend its findings
of fact and conclusions of law because the same did not
conform to the evidence. This motion was noticed for hear-
ing on December 3, 1979.
On November 9, 1979, appellants filed their motion to
alter or amend the judgment because the same did not conform
to the weight of the evidence presented at trial. This
motion was also noticed for hearing on December 3, 1979.
Appellants' memorandum brief in support of their motion
to alter or amend the judgment was not signed by appellants'
attorney until November 30, 1979, and could not have been
filed any earlier than that date.
A hearing on these motions was held on Monday, December
3, 1979. On Wednesday, December 5, 1979, and before the
court could rule on appellants' motions, appellants filed
their notice of appeal. Having done this, appellants stripped
t h e D i s t r i c t C o u r t of j u r i s d i c t i o n . The D i s t r i c t C o u r t w a s
w i t h o u t a u t h o r i t y and j u r i s d i c t i o n t o make o r e n t e r any
f u r t h e r o r d e r e x c e p t i n m a t t e r s embraced i n t h e a c t i o n and
n o t a f f e c t e d by t h e o r d e r a p p e a l e d from. Benolken v.
Miracle, supra.
I n B r y a n t Development A s s o c i a t i o n v . Dagel ( 1 9 7 4 ) , 166
Mont. 8, 531 P.2d 1319, t h i s C o u r t , i n a p e r curiam o r d e r ,
stated:
". . . Under s e c t i o n 93-8011, R.C.M. 1947, w e ,
have p r e v i o u s l y h e l d t h a t j u r i s d i c t i o n p a s s e s
from t h e d i s t r i c t c o u r t t o t h i s C o u r t upon ser-
v i c e and f i l i n g of t h e n o t i c e of a p p e a l . See
Benolken v. M i r a c l e , 128 Mont. 262, 273 P.2d
667; P o l s o n v. Thomas, 138 Mont. 533, 357 P.2d
349. While t h i s s t a t u t e h a s been s u p e r s e d e d
by R u l e s 6 and 7 of t h e Montana Rules of Ap-
p e l l a t e C i v i l P r o c e d u r e t h e former r u l i n g s t i l l
a p p l i e s and t h e d i s t r i c t c o u r t was w i t h o u t
j u r i s d i c t i o n t o make and e n t e r i t s o r d e r . . ."
513 P.2d a t 1320.
A t no t i m e a f t e r a p p e l l a n t s ' n o t i c e of a p p e a l was f i l e d
w i t h t h e D i s t r i c t C o u r t was t h e r e a motion t o d i s m i s s t h e
a p p e a l o r t o withdraw t h e n o t i c e of a p p e a l . When t h e D i s -
t r i c t C o u r t amended i t s f i n d i n g s o f f a c t and c o n c l u s i o n s of
law on December 1 0 , 1979, and a g a i n on F e b r u a r y 26, 1980, i t
d i d s o without t h e necessary j u r i s d i c t i o n . Therefore, these
amendments a r e n u l l and v o i d , and t h e o r i g i n a l judgment
stands.
On a complete r e v i e w of t h e r e c o r d , w e f i n d t h a t t h e
o r i g i n a l judgment awarding r e s p o n d e n t damages of $34,068 i s
not justified. T h e r e i s no b a s i s o r e v i d e n c e i n t h e r e c o r d
f o r such a n amount. Respondent concedes t h i s . The D i s t r i c t
C o u r t a t t e m p t e d t o c o r r e c t t h e s e f i n d i n g s by t h e s u b s e q u e n t
amended f i n d i n g s and judgment. Upon remand of t h e c a s e , t h e
D i s t r i c t C o u r t may p r o p e r l y e v a l u a t e t h e damages and amend
i t s p r i o r f i n d i n g s and judgment.
A p p e l l a n t s n e x t a r g u e t h a t t h e i n t e r e s t damage award
e n t e r e d by t h e D i s t r i c t C o u r t i n t h e o r i g i n a l judgment i s
s p e c u l a t i v e and i n c a p a b l e of a c c u r a t e and r e a s o n a b l e d e t e r -
m i n a t i o n a s a m a t t e r of law.
The D i s t r i c t C o u r t awarded i n t e r e s t damages f o r t h e
d i f f e r e n c e between t h e i n t e r e s t p a i d o v e r a t h i r t y - y e a r
p e r i o d on a 9-3/4 p e r c e n t l o a n and i n t e r e s t p a i d o v e r a
t h i r t y - y e a r p e r i o d on a 11-1/2 percent rate. Appellants
c o n t e n d t h a t s h o u l d i n t e r e s t r a t e s d r o p below 11-1/2 p e r -
c e n t , r e s p o n d e n t c o u l d r e f i n a n c e h i s home a t t h e lower r a t e
and n e v e r i n c u r t h i s damage. Appellants claim t h i s aspect
o f damages i s s p e c u l a t i v e , remote and p r o s p e c t i v e i n n a t u r e
and r e s p o n d e n t h a s n o t i n c u r r e d a p r e s e n t i n j u r y . W dis-
e
agree.
I n Walton v . C i t y of Bozeman ( 1 9 7 8 ) , - Mont.
588 P.2d 518, t h i s C o u r t upheld t h e D i s t r i c t C o u r t ' s award
of f u t u r e o r p r o s p e c t i v e damages:
" ' P r o s p e c t i v e damages' a r e t h o s e which a r e r e a -
s o n a b l y c e r t a i n t o f o l l o w t h e s t a t e of f a c t s
on which p l a i n t i f f ' s s u i t i s b a s e d ; s u c h dam-
a g e s have n o t y e t a c c r u e d a t t h e t i m e of t r i a l ,
b u t i n t h e n a t u r e [ o f ] t h i n g s must c e r t a i n l y
o r most p r o b a b l y r e s u l t from t h e s t a t e of
f a c t s found t o be e x i s t i n g a t t h e t i m e of
t r i a l . See S t a t e Highway Board v. Coleman
( 1 9 4 8 ) , 77 Ga.App. 756, 50 S.E.2d 262.
"Although s p e c u l a t i v e damages may n o t be r e -
covered, reasonable c e r t a i n t y t h a t f u t u r e
damages w i l l o c c u r w i l l s u s t a i n a n award f o r
f u t u r e damages. This test m e e t s t h e s t a t u t o r y
r e q u i r e m e n t s t h a t such must be r e a s o n a b l e .
S e c t i o n 17-607, R.C.M. 1947. See C r u s e v.
Clawson (1960) , 137 Mont. 439, 352 P.2d 989."
Walton, 588 P.2d a t 522.
I n t h e p r e s e n t c a s e t h e amount of damages i s n o t specu-
l a t i v e b u t r a t h e r c a n be d e t e r m i n e d . Respondent c a n n o t b e
expected t o sue a p p e l l a n t s every t i m e t h e i n t e r e s t r a t e
changes. There i s s u f f i c i e n t c e r t a i n t y i n t h e r e c o r d t o
make a damage award, a f t e r d i s c o u n t i n g t h e amount p r o p e r l y .
W w i l l n o t h e r e d i s c u s s t h e amount and t h e a c c u r a c y of
e
t h e amount awarded. On remand t h e D i s t r i c t C o u r t w i l l be
a l l o w e d t o amend i t s f i n d i n g s of f a c t , c o n c l u s i o n s of l a w
and judgment i n d e t e r m i n i n g t h e i n t e r e s t damage amount,
d i s c o u n t i n g p r o p e r l y and awarding s u c h amount.
F i n a l l y , a p p e l l a n t s a r g u e t h a t t h e award of 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 o r i g i n a l judgment was e r r o r b e c a u s e t h e
D i s t r i c t C o u r t f a i l e d t o a l l o w a h e a r i n g on t h e m a t t e r .
Only i n a s u b s e q u e n t h e a r i n g , a f t e r t h e o r i g i n a l judgment
w a s entered, w a s t h e r e an opportunity t o address t h a t i s s u e
and t o d e t e r m i n e a n e x a c t amount.
Upon remand t h e D i s t r i c t C o u r t s h a l l a l s o e n t e r a
p r o p e r amended f i n d i n g of f a c t , c o n c l u s i o n of law and judg-
ment r e g a r d i n g t h e amount of a t t o r n e y f e e s based on f i n d i n g s
i t made on s u b s e q u e n t h e a r i n g s . Attorney f e e s should be
awarded t o t h e p r e v a i l i n g p a r t y i n t h i s l i t i g a t i o n up t o t h e
t i m e of t h e o r i g i n a l judgment and n o t i c e o f a p p e a l . However,
a l l c o s t s and a t t o r n e y f e e s i n c u r r e d s u b s e q u e n t t o t h e t i m e
o f f i l i n g of t h e n o t i c e of a p p e a l s h a l l b e p a i d by e a c h
party. Any s u b s e q u e n t c o s t s and a t t o r n e y f e e s from t h e
i s s u a n c e of t h i s o p i n i o n s h a l l b e d e t e r m i n e d by t h e D i s t r i c t
C o u r t i n a c c o r d a n c e w i t h t h e law.
The c a u s e i s remanded t o t h e D i s t r i c t C o u r t f o r f u r t h e r
proceedings c o n s i s t e n t with t h i s opinion.
n
W concur:
e
dt
? &Chief J u s t i c e
A &'-
T h i s c a u s e was s u b m i t t e d p r i o r t o J a n u a r y 5 , 1981.