No. 86-557
I N THE SUPREME COURT O F THE S T A T E O F MONTANA
1987
DOROTHY M. HALCRO and ROBERT M.
HALCRO, husband and w i f e ,
P l a i n t i f f s and R e s p o n d e n t s ,
DONALD C . MOON a k a DON C . MOON, J R . ,
D e f e n d a n t and A p p e l l a n t .
A P P E A L FROM: D i s t r i c t C o u r t of t h e E i g h t h J u d i c i a l D i s t r i c t ,
I n and f o r t h e C o u n t y of C a s c a d e ,
T h e H o n o r a b l e John M c C a r v e l , Judge p r e s i d i n g .
COUNSEL O F RECORD:
For A p p e l l a n t :
H a r t e l i u s & Ferguson; C a m e r o n Ferguson, G r e a t F a l l s ,
Montana
For R e s p o n d e n t :
Sandra K . W a t t s , G r e a t F a l l s , M o n t a n a
S u b m i t t e d on B r i e f s : Jan. 29, 1987
Decided: March 1 2 , 1 9 8 7
~iled:
MAR 1 2 j387
7% %fl4
Clerk
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of
the Court.
Defendant Donald Moon appeals the summary judgment
awarded in favor of plaintiffs by the Eighth Judicial
District Court, County of Cascade. We affirm.
This case involves breach of a buy-sell contract.
Robert and Dorothy Halcro were the sellers and Donald Moon
the buyer. In August of 1985, Halcros listed their home for
sale. The house is located at 2312 Sixth Avenue South in
Great Falls, Montana. On August 8, 1985, Halcros entered
into a written agreement with Moon to sell their home for
$57,000. The terms were $13,800 in cash as a down payment
plus assumption of a $34,100 first mortgage and a $9,100
second mortgage. The only condition precedent contained in
the agreement was that Moon sell his home in Colorado. The
closing date was listed as November 1, 1985.
Moon sold his Colorado home for less than anticipated so
he requested that Mr. Halcro reduce the purchase price on the
2312 Sixth Avenue property by $1000. The parties
compromised, and a new buy-sell agreement was signed October
18, 1985, lowering the purchase price by $500. All other
terms remained the same. The premises were vacant prior to
the closing date as Halcros had purchased and moved into
another home.
On October 24, 1985, Mr. Halcro inspected the vacant
premises and discovered water on the floor of the laundry
room and the adjacent bathroom floor was raised. Halcro
informed his real estate agent, Ginger Wheeler, of the
problem. Ms. Wheeler informed Moon repairs would be
conducted within a week.
Mr. Halcro determined the problem to be leaky faucets in
the utility room, so he replaced the washers and hired a
contractor to repair the bathroom floor. The Moons arrived
in Great Falls approximately November 7, 1985. Upon entering
the home a musty smell was present. A large puddle was
discovered in the utility room and the repair work on the
bathroom floor was inadequate. Water was also discovered in
the crawl space beneath the house.
Mr. Halcro and Ms. Wheeler met with the Moons the
following day. Mr. Halcro promised to warrant in writing
that he would undertake further repair and cover all costs.
The following day Mr. Moon informed Ms. Wheeler he and his
wife had decided not to buy the house. Mr. Halcro rented
the house to Steve Kroger the following week.
Contract Flooring repaired the bathroom floor and
discovered a pinhole leak in the waterline beneath the
bathroom floor. Palagi Plumbing repaired the water line.
The repairs took one week and Mr. Kroger stated in his
affidavit that the repair work did not inconvenience his
family. There have been no water problems in the house since
that time.
Halcros filed an action against Moon for specific
performance of the buy-sell agreement. Moon's answer raised
the defense of breach of contract by Halcros. The answer was
amended to include mistake of fact and failure of
consideration. Halcros filed a motion for summary judgment
based upon the pleadings, admissions, and affidavits in the
record. Following hearing, the District Court granted
summary judgment in favor of Halcros and ordered Moon to
perform the terms of the contract. Moon appeals and raises
the following issues:
1) Whether summary judgment was proper?
2) Whether Moon was entitled to rescind the contract
upon the grounds of mistake of fact and failure of
consideration?
3) Whether Moon was entitled to rescind the contract
upon the ground that Halcros breached the contract?
4) Whether the relief granted to Halcros was proper?
Summary judgment is proper pursuant to Rule 56(c)
Mont. R.Civ. P. where the record discloses no genuine issue of
material fact and the moving party is entitled to judgment as
a matter of law. All reasonable inferences that may be drawn
from the offered proof are to be drawn in favor of the party
opposing summary judgment. Abell v. Travelers Insurance Co.
(Mont. 1983), 663 P.2d 335, 40 St.Rep. 738. A review of the
record in this case shows no genuine issue of material fact
and supports the summary judgment in favor of Halcros.
Each of the defenses raised by Moon are dependent upon a
showing that the water problems in the house were so
substantial as to defeat the object of the contract. In
Woodahl v. Matthews (1981), 196 Mont. 445, 639 P.2d 1165, the
buyer sought to rescind a contract to buy the seller's home
on grounds of breach of express warranty, mistake of fact,
and failure of consideration. After signing an agreement to
purchase the home, the buyer discovered the floors sloped at
a rate of 5% inches every thirty feet. Testimony from the
sellers and several workmen who worked on the house revealed
that the sloped floors had gone unnoticed for 10 years. This
Court held the buyers were not entitled to rescind the
contract due to mistake of fact because the mistake was not
"so substantial and fundamental as to defeat the object of
the contract." 196 Mont. 452, 639 P.2d 1169. Additionally,
we found no failure of consideration because the buyers
received that for which they bargained.
Compton v. Alcorn (1976), 171 Mont. 230, 557 P.2d 292,
is a case in which this Court held rescission of a contract
to buy a mobile home was proper due to a substantial failure
of consideration. The mobile home's defects were numerous,
most notably a furnace which was unusable and dangerous. We
found that substantial and fundamental defects defeated the
object of the contract which was to provide the buyers a new
mobile home with readily available housing.
In the present case, Moon has offered no evidence that
the water problems were so substantial as to defeat the
object of the contract. Moon claims he was entitled to
rescission because he believed the house had substantial
plumbing problems. However, the evidence reflects that this
was not the case. A pinhole leak was repaired, no structural
damage was found, and there have not been any water problems
in the house since that time.
Moon moved his family from Colorado with the expectation
of moving into the house upon arrival. Unlike the situation
in Compton, supra, there is no evidence that the house was
not habitable. In fact, the house was rented the following
week to Mr. Kroger. The house has two bathrooms and Kroger's
family was not inconvenienced by the repair work which lasted
one week. We find no evidence in the record that the water
leak was so substantial as to defeat the object of the
contract.
Moon contends Halcros breached the contract by failing
to have the water leak repaired by the time Moon's family
arrived at the house. There is no dispute that Mr. Halcro
promised to have the water leak fixed prior to the Moons
arrival but Halcro's repair work was inadequate. Still, Moon
has presented no evidence that the breach was material. In
Johnson v. Meiers (1946), 118 Mont. 258, 164 P. 2d 1012, this
Court stated:
A breach which goes to only part of the
consideration, is incidental and subordinate to the
main purpose of the contract, and may be
compensated in damages does not warrant a
rescission of the contract; the iniured party is
still hound to perform his part of the agreement,
and his only remedy for the breach consists of the
damages he has suffered therefrom.
118 Mont. 263, 164 P.2d 1014.
This reasoning is applicable here. We find no material
breach by Halcros entitling Moon to rescission.
The final issue on appeal is whether the District Court
properly granted specific performance in favor of Halcros.
Section 27-1-411 (4), MCA, provides that specific performance
may be compelled when the parties to a contract have
expressly agreed in writing that specific performance shall
be an available remedy. The buy-sell agreement signed by the
parties expressly provided for a remedy of specific
performance. Halcros had a right to pursue this remedy and
were not required to re-list the house for sale.
The District Court is affirmed.
We concur: .
4
P.k
Justic