No. 93-23-I
IN THE SUPREME COURT OF THE STATE OF MONTANA
1993
RITAI. JOHNSON and
DUANE L. JOHNSON,
Wife and Husband,
Plaintiffs and Appellants,
SEP -- 9 1993
JACK REHBERG, President,
JOYCE RANDALL, Vice-President,
SECURITY FEDERAL SAVINGS BANK,
formerly Known as SECURITY
FEDERAL SAVINGS AND LOAN,
Defendants and Respondents.
APPEAL FROM: District Court of the Thirteenth Judicial District,
In and for the County of Yellowstone,
The Honorable Maurice R. Colberg, Judge presiding.
COUNSEL OF RECORD:
For Appellants:
Rita I Johnson and Duane L. Johnson, Pro Se,
Gig Harbor, Washington
For Respondents:
Earl J. Hanson; Hanson & Todd, Billings, Montana
Submitted on Briefs: August 26, 1993
Decided: September 9, 1993
Filed:
Justice Karla M. Gray delivered the Opinion of the Court.
Rita I. Johnson and Duane L. Johnson appeal pro se from the
memorandum and order of the Thirteenth Judicial District Court,
Yellowstone County, granting summary judgment to Jack Rehberg,
Joyce Randall, and Security Federal Savings Bank, and from the
judgment entered thereon. We affirm.
The only issue properly before us is whether the District
Court erred in granting summary judgment.
Rita I. and Duane L. Johnson (the Johnsons) borrowed money
from Security Federal Savings Bank and signed notes evidencing the
debt; the notes were secured by a mortgage and a trust indenture.
Both the mortgage and the trust indenture required the Johnsons to
keep the building and improvements insured against hazards, and to
reimburse the bank for the cost of any insurance it had to provide
to keep continuous insurance coverage in place for the premises.
In 1988, the bank was notified that the insurance policy
covering the Johnsons' property would not be renewed: the policy
expired on April 8, 1988. Pursuant to the terms of the mortgage
and trust indenture, the bank acquired and paid for coverage for
the property. The bank informed the Johnsons that their monthly
payments would increase to reflect the insurance premium the bank
had paid.
The Johnsons refused to pay the additional amounts and
eventually defaulted on the trust indenture. A foreclosure sale
was held and the property was sold to the bank.
2
On August 1, 1990, the Johnsons filed a pro se complaint
against the bank and two of its officers, Jack Rehberg and Joyce
Randall (collectively Security Federal). The complaint essentially
alleged wrongful foreclosure of the mortgage and trust indenture.
Security Federal answered and discovery began.
Security Federal subsequently moved for summary judgment and
filed affidavits, documents and depositions in support of its
motion. The Johnsons filed a memorandum in opposition to the
motion in which they reasserted the bases for their complaint; they
included certain attachments in purported support of the "Statement
of Facts" contained in the memorandum. On March 8, 1993, the
District Court granted Security Federal's motion for summary
judgment. It determined that the Johnsons had raised no genuine
issue of material fact and that Security Federal was entitled to
judgment as a matter of law. Judgment was entered accordingly.
The Johnsons appealed.
We note that the Johnsons attempt to raise a number of issues
that are not relevant to the question of whether the District Court
erred in granting summary judgment. We do not address these
issues, but confine ourselves to applying the well-settled rules
relating to summary judgment.
Rule 56(c) of the Montana Rules of Civil Procedure provides
that, upon motion, summary judgment shall be rendered if the
pleadings, filed discovery and affidavits, if any, show that there
is no genuine issue of material fact and that the moving party is
entitled to judgment as a matter of law. The moving party has the
3
initial burden of establishing the absence of any genuine issue of
material fact and entitlement to judgment as a matter of law: once
that burden is met, the party opposing the motion must come forward
with substantial evidence raising a genuine issue of material fact,
and the nonmoving party cannot simply rely on its pleadings or on
speculative or conclusory statements. Thomas v. Hale (1990), 246
Mont. 64, 66-67, 802 P.2d 1255, 1256-57.
Here, the Johnsons' complaint was premised on their claim that
the mortgaged property was at all times covered by insurance
provided by them. They alleged throughout the proceedings that
they had timely obtained an insurance binder covering the property
from Allstate Insurance Company and that Security Federal knew of
the binder in April, 1988. On the basis of that binder, the
Johnsons claimed that they did not default and, therefore, that
they were not obligated to pay the increase in their mortgage
payments resulting from Security Federal obtaining alternate
insurance coverage. Thus, they asserted that the foreclosure was
wrongful.
Security Federal established by affidavits and deposition that
it was notified that the Johnsons' insurance would not be renewed,
that that coverage expired on April 8, 1988, and that it obtained
and paid for alternative coverage for the property. The
alternative coverage remained in effect until late September of
1988, when Security Federal first received an insurance binder--
back-dated to April 4, 1988--on the Johnsons' property from
Allstate: it had no notice of the binder before that date. The
4
deposition testimony of the insurance agent who obtained and issued
the back-dated binder established that he received the initial
request for the binder on or about September 28, 1988, and that no
binder existed until that time. Security Federal further
established that it had the right, pursuant to the mortgage and
trust indenture, to increase the Johnsons' mortgage payments to
cover the amount of insurance premiums it had paid, and that the
Johnsons did not pay those amounts.
Security Federal met its initial burden of establishing the
absence of any genuine issue of material fact relating to the
Johnsons' complaint against it. While the Johnsons continued to
assert that the property was at all times covered by insurance
provided by them, and that Security Federal knew of the Allstate
binder in April, 1988, they did not come forward with affidavits,
documents or discovery establishing those facts or any genuine
dispute regarding those facts.
The Johnsons argue on appeal that the District Court did not
consider a letter "from our agent Mack Morrison of Tacoma stating
the effective date [of the binder] as April [1988].1* The letter
does not support the Johnsons' statement. It merely recites that
in April, 1988, the Johnsons contacted Mack Morrison, an Allstate
agent in Tacoma, with regard to how they could insure their
Billings residence with Allstate. The letter neither states nor
implies in any way that coverage was obtained at that time.
The Johnsons had the burden of coming forward with substantial
evidence raising a genuine issue of material fact; they could not
5
rely on either allegations contained in their pleadings or
conclusory statements. Thomas, 802 P.2d at 1257. They did not
meet their burden.
We hold that the District Court did not err in granting
summary judgment to Security Federal Savings Bank, Jack Rehberg,
and Joyce Randall.
Pursuant to Section I, Paragraph 3(c), Montana Supreme Court
1988 Internal Operating Rules, this decision shall not be cited as
precedent and shall be published by its filing as a public document
with the Clerk of the Supreme Court and by a report of its result
to Montana Law Week, State Reporter and West Publishing Company.
AFFIRMED.
We concur:
6