No. 85-232
I N THE SUPREME COURT O THE STATE O MONTANA
F F
1986
MEL PALIN d / b / a PALIN RANCH,
Enterprises,
P I - a i n t i f f and A p p e l l a n t ,
GERBERT L O G G I N G , I N C . ,
a Montana c o r p o r a t i o n ,
Defendamt and Respondent.
F O :
R M D i s t r i c t Court o f t h e Fourth. J u d i c i a l D i s t r i c t ,
I n and. for t h e County o f Missou.la,
The Honorable James B. W h e e l i s , Judge p r e s i d i n g .
COUNSEL O RECORD:
F
For A p p e l l a n t :
S m a l l , Hatch, Doubek & P y f e r ; John C . Doubek, H e l e n a ,
Montana
For Respondent:
T. K. B o t s f o r d , M i s s o u l a , Montana
S u b m i t t e d on B r i e f s : Oct. 25, 1985
Decided: March 2 0 , 1 9 8 6
Filed: MAR 2 0 '1386
Mr. Justice John C. Sheehy delivered. the Opinion of the
Court.
Me1 Palin appeals from an order of the Fourth Jud-icial
District Court, Missoula County, granting partial summary
judgment in favor of Gebert Logging, Incorporated. We
affirm.
On January 11, 1984, Me1 Palin, d/b/a Palin Ranch
Enterprises entered into a written agreement with Gebert
Logging for the sale and removal of timber from certain lands
located in Granite County. The agreement provided among
other things that Gebert would fell, load and remove logs to
the Champion International Corporation plant at Bonner
Monta-na; and that Gebert would repair all fences, gates and
cattle guards and blede all roads to a smooth surface after
the logging operations were completed. Pursuant to the
contract Gebert paid to Palin $20,000, of which $10,000 was a
prepayment by Gebert for stumpage and the remaining $10,000
was to be held as a hond by Palin until the expiration of the
agreement.
Pursuant to the agreement, Gebert went upon the
described lands, felled trees, and removed and delivered the
logs to Champion's plant at Bonner. After the first $10,000
worth of logs had been delivered to Champion, Palin was paid-
by Champion for his seller's share of the proceeds of the
logs.
When the agreement expired, Gebert demanded the $10,000
bond be returned to it. Palin refused, claiming that the
land had been damaged, gates and roads also damaged and that
Gebert had failed properly to perform the contract. Gebert
commenced suit to recover its bond from Palin, and through
discovery learned that Palin was not in fact the owner of the
land described in the written contract, but that rather
Palin's wife was the record owner of the land.
Palin contended by affidavit after suit commenced that
since 1972 he had managed the real property of the Pa.l.in
family which included the real property under the timber
sales agreement, and that he entered into the timber sales
agreement as agent for his wife with her approval and
knowledge. Palin's wife filed an affidavit to the effect
that she was aware of and had approved the timber sales
agreement and that Palin had full authority and approval to
act as her agent in contracting for the sale of the timber
located on the real property which she owned.
The answers to interrogatories filed by Palin indicated
that he neither owned the timber nor the real property
covered by the contract nor had any written authority to
execute the contract for the owner, his wife.
The District Court granted partial summary judgment in
favor of Gebert for the sun nf $10,000 and accrued interest
and dismissed Palin's counterclaim against Gebert for the
damages to the lands that Palin had claimed. The District
Court further found that Palin's actions in the premises
constituted a breach of his duty of good faith and fair
dealing. The partial summary judgment reserved for further
hearing the determination of the amount of exempla-ry damages
to be awarded. The partial summary judgment was certified by
the District Court for purposes of appeal under Rule 5 4 ( b ) ,
M.R..Civ.P.
The issue hefore this Court is whether the grant of
partial summary judgment in this case was proper.
Summary judgment is proper if ~znder the record before
the district court there is no genuine issue as to any
material fact and the moving party is entitled to judgment as
a matter of law. Rule 56(c), M.R.Civ.P. Cereck v.
Albertsons, Inc. (1981), 195 Mont. 409, 637 P.2d 509;
Gilleard v. Draine (1972), 159 Mont. 167, 496 P.2d 83; Roope
v. Anaconda Co. (1972), 159 Mont. 28, 494 P.2d 922.
A summary judgment is proper when the party opposing the
motion fails either to raise or to demonstrate the existence
of the genuine issue of material fact, or to demonstrate that
the legal issue should not be determined in favor of the
movant. State ex rel. Rurlington Northern v. District Court
(1972), 159 Nont. 295, 300, 496 P.2d 11.52, 1155.
The District Court determined t-hat the contract between
the plaintiff and the defendant was covered under the Uniform
Commercial Code in § 30-2-107(2), MCA, and that it was for a
sale of goods for a price of more than $500 which requires
the contract to be in writing. Section 30-2-201(1), MCA.
Palin did not have written authority to execute the written
contract as the agent of his wife an6 he therefore acted
without authority. Section 28-10-203, MCA; Schlenz v. John
Deere Co. (U.S.D.C. Mont. 1981), 511 F.Supp. 224. The wife,
Hilldegarde Palin, cou1.d not ratify the acts of her husband
retroactively in this case without the consent of Gebert.
Section 28-10-213, MCA.
The District Court further determined that prior to
Gebert's motion for summary judgment, Palin had held himself
out to Gehert and to the District Court as the owner of the
timber and the land as a seller to Gebert, and not as an
agent acting for an undisclosed principal without written
authority.
In Larry C. Iverson, Inc. v. Rouma (1981), 195 Mont.
351, 375, 639 P.2d 47, 60, we approved a holding from another
jurisdiction that a contract entered into without the power
to contract cannot be ratified or enforced, and that
incapacity to contract cannot be removed by estoppel. In
this case Palin had no written authority, as required by law,
to enter into the timber sales agreement. The subsequent
attempts at ratification by his wife give no life to his
actions. The District Court acted properly therefore in
entering judgment against Palin for the sum of $10,000, the
amount of bond which he held, plus accrued interest thereon,
and was further correct in dismissing Palin's cross claim for
damages to the realty, since he was not the owner thereof.
Palin contends that when the contract is partly
performed by the parties sought to be charged, the statute of
frauds in the Uniform Commercial Code, S 30-2-201, MCA, has
no application under Northwest Potatoes Sales, Inc. v. Beck
(Yont. 1984), 678 P.2d 1138, 41 St.Rep. 362; and that where
both parties have performed and one party had significantly
altered his position to his detriment, it is unconscionable
to invalidate the contract by relying upon the statute of
frauds, citing Bolz v. Myers (Mont. 1982), 651 P.2d 606, 39
St.Rep. 1747.
Pal-in contends that the statute of frauds under the UCC
does not require that both parties sign the contract but that
only the "party against whom enforcement is sought" must sign
the agreement which in this case would be the respondent
Gebert .
Gebert responds that the cited cases are not applicable
here because it was Gebert that altered its position based on
Palin holding himself out as owner of the lands; that Gebert
was at all times capable of performing the contract and did
perform it; a n d that it was Palin who lacked the authority
and capability to sign the contract. We agree with Gebert
and determine that neither Northwest Potato Sales, supra, nor
Bolz 5 Myers, supra, have any application to this case.
The affirmative defense of estoppel cannot be raised by
Palin for the first time on appeal. Montana Seeds, Inc. v.
Hol-liday (1978), 178 Mont. 119, 582 P.2d 1223.
Under the facts of this case, the contract was
unenforceable because it was not signed by the owner of the
lands, nor by a party having authority in writing to contract
for the owners; and Palin, because he is not the owner of the
lands, has no claim for damages, if any, that Gebert may have
caused the lands. Thus there is no genuine issue of material.
facts in this case and the District Court properly entered
summary judgment.
A Q.
Justice
2
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We Concur:
r
Chief Justice