Swain v. Battershell

No

No. 98-165

IN THE SUPREME COURT OF THE STATE OF MONTANA

1999 MT 101

294 Mont. 282

983 P.2d 873

KEN SWAIN d/b/a MONTANA

CONCRETE FINISHING,

Plaintiff and Appellant,

v.

THOMAS M. BATTERSHELL and

BATTERSHELL PROPERTIES, INC.,

Defendant and Respondent.

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APPEAL FROM: District Court of the First Judicial District,

In and for the County of Lewis and Clark,

The Honorable Thomas C. Honzel, Judge presiding.

COUNSEL OF RECORD:

For Appellant:

Palmer A. Hoovestal, Helena, Montana

For Respondent:

David N. Hull, Helena, Montana

Submitted on Briefs: September 17, 1998

Decided: May 18, 1999

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Filed:

__________________________________________

Clerk

Justice William E. Hunt, Sr. delivered the Opinion of the Court.

¶1. On December 27, 1995, Appellant Ken Swain d/b/a Montana Concrete Finishing
(Swain) filed a lawsuit against Respondents Thomas M. Battershell (Battershell) and
Battershell Properties, Inc. (BPI) to execute a construction lien foreclosure and to
recover damages for breach of contract, promissory estoppel, and breach of the
covenant of good faith and fair dealing. On February 21, 1996, Battershell and BPI
filed their answers. In addition, BPI counterclaimed to recover damages for breach
of contract, promissory estoppel, breach of the covenant of good faith and fair
dealing, and fraud.

¶2. On November 12, 1996, Battershell filed a motion for partial summary judgment
on Count I, concerning the construction lien foreclosure, on the ground that the
construction lien was invalid and unenforceable as a matter of law. On February 7,
1997, the First Judicial District Court, Lewis and Clark County, issued an order
granting Battershell's partial summary judgment motion. The remaining counts
proceeded to a non-jury trial in July and August of 1997. On December 26, 1997, the
court issued its findings of fact, conclusions of law, and order concluding that Swain
was entitled to judgment in the amount of $2000, but that Battershell was entitled to
$2650 in attorney's fees incurred in defending the construction lien foreclosure part
of the lawsuit. The court also concluded that BPI lacked standing to bring a
counterclaim against Swain and, therefore, was not entitled to recover any damages
pursuant to its counterclaim. The parties appealed to this Court.

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¶3. On April 20, 1998, Battershell filed with this Court a motion to dismiss Swain's
appeal pursuant to Rule 22, M.R.App.P. Battershell asserted that in January 1997,
Swain had filed an amended construction lien naming Cascade Exchange, Inc.
(Cascade) as the contracting owner instead of Battershell. Battershell argued that the
filing of the amended construction lien rendered moot any appeal concerning the
validity of the original construction lien. On April 5, 1998, we issued an order
denying Battershell's motion to dismiss without prejudice.

¶4. Swain appeals from the court's grant of partial summary judgment in favor of
Battershell, and the later grant of attorney's fees to Battershell, concerning the
construction lien foreclosure count of the lawsuit. Battershell and BPI cross-appeal
from the court's findings of fact, conclusions of law, and order concerning the
remaining counts of the lawsuit. Further, Battershell renews his motion to dismiss
Swain's appeal for mootness. We conclude that Swain's appeal is not moot and we
affirm on each issue.

¶5. Swain presents the following issues for review:

¶6. 1. Did the court err in granting Battershell's partial summary judgment motion
on the ground that the construction lien was invalid as a matter of law?

¶7. 2. Did the court err in granting Battershell his reasonable attorney's fees in
defending the construction lien foreclosure?

¶8. Battershell presents the following issue for review: Did the court err in finding
that the sidewalk was poured in accordance with industry standards and that the
lack of uniformity in the finish on the sidewalk was caused by rain?

¶9. BPI presents the following issue for review: Did the court err in concluding that
BPI did not have standing to bring a counterclaim because it was not the party with
whom Swain had contracted?

FACTS

¶10. BPI is a Montana corporation which owns several property holdings in and
around Helena. Battershell is president of BPI and Jeff Battershell (Jeff),
Battershell's son, is vice-president of BPI. BPI is the record owner of a tract of real

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property in Helena on which a mini-mall was built. BPI obtained ownership of this
property on February 27, 1996, pursuant to a "1031 like kind exchange" under the
Internal Revenue Code. Prior to this exchange, Cascade owned the mini-mall
property. Construction of the mini-mall began in 1995, during Cascade's ownership
of the property. Battershell was the general contractor responsible for overseeing
construction of the mini-mall.

¶11. On September 7, 1995, Battershell contacted Swain to inquire about Swain's
availability to pour the concrete slab at the mini-mall. He told Swain that the
foundation of the mini-mall had already been laid but that the work was progressing
slowly. He told Swain he needed the slab to be poured in three days. Swain agreed to
meet Battershell at the project site to inspect it. At the project site, Battershell
represented to Swain that he owned the mini-mall property. After discussing the
project, Swain contracted with Battershell to pour and finish the concrete slab at the
mini-mall for $9100, to pour and finish the concrete slab at an adjacent store for
$1200, and to pour and finish a concrete sidewalk at the mini-mall for $2000. The
parties agreed that the mini-mall sidewalk would have a fine broom finish.

¶12. Swain performed the slab work for the first two jobs in September and received
full payment. Swain performed the sidewalk work on October 3 and 5, 1995, but did
not receive payment. Battershell was dissatisfied with the quality of workmanship,
complaining that the sidewalk did not have a uniform fine broom finish. Battershell
refused to pay Swain unless Swain rebuilt the sidewalk. Swain initially told
Battershell that he thought he could fix the sidewalk. However, Swain did not return
to the project site.

¶13. On November 7, 1995, Swain recorded a construction lien against the mini-mall
property, naming Thomas M. Battershell as the contracting owner of the property.
Thereafter, Swain filed suit to foreclose on the property and to recover contract
damages. Battershell counterclaimed to recover contract damages and filed a motion
for partial summary judgment on the issue of the construction lien foreclosure. On
February 7, 1997, the court granted Battershell's motion, concluding that because
Thomas M. Battershell was not the contracting owner of the mini-mall property,
Swain's construction lien failed to meet the statutory notice requirements and was
invalid as a matter of law. The parties' remaining claims proceeded to a non-jury
trial.

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¶14. At trial, Swain testified that he poured the sidewalk in a workmanlike manner
and in accordance with industry standards. He testified that the sidewalk was a
commercially acceptable product, and noted that Battershell and the tenants and
customers of the mini-mall were using the sidewalk. Swain testified that on the day
he began work on the sidewalk, he had finished laying the forms for the sidewalk
when he noticed inclement weather approaching. Swain and his crew told Jeff that
they would not be able to achieve the fine broom finish requested by Battershell if the
sidewalk was poured and finished in the rain. Jeff told Swain that it was imperative
that the sidewalk be completed that day because the pavers were waiting to begin the
next day and may not be available at another time due to other obligations. Swain
testified that Battershell had also told him in a prior conversation that construction
of the mini-mall sidewalk must proceed according to a tight schedule. Despite
Swain's advice to the contrary, Jeff instructed Swain and his crew to pour the
sidewalk that day.

¶15. Swain testified that after pouring much of the 400 foot sidewalk, it began to rain
and continued raining for most of the day. He stated that he covered the sidewalk
with rolls of visqueen but that the wind and rain made it difficult to adequately
protect the sidewalk. Swain stated that much of the water accumulating at the
building site flowed on to the sidewalk. He further stated that the visqueen itself
affected the finish of the sidewalk because it "changes the way the concrete dries."
Swain stated that he and his crew finished the sidewalk with a steel trowel and fine
broom finish as best they could under the conditions caused by the rain and
visqueen.

¶16. Swain testified that after finishing the sidewalk, he asked Jeff about the
placement of grooves in the sidewalk to control cracking. Jeff told Swain not to make
any grooves. After Swain advised against this, Jeff then told Swain to place the
grooves all along the sidewalk at every "column line," approximately 35 feet apart.
Again, Swain advised against this procedure and recommended placing grooves
along the sidewalk 5 feet apart. Jeff refused Swain's recommendation and instead
instructed Swain to place grooves at every column line and half way in between,
which would place the grooves approximately 17 feet apart. Swain did as he was
instructed. More facts will be provided as necessary to dispose of the issues raised.

DISCUSSION

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A. Swain's appeal

Issue 1

¶17. Did the court err in granting Battershell's partial summary judgment motion on the ground that the
construction lien was invalid as a matter of law?

¶18. Swain contends the District Court erred in determining that the construction
lien filed November 7, 1995, was invalid as a matter of law because it named
Battershell, rather than Cascade, as the contracting owner of the mini-mall property.
Swain acknowledges that for a construction lien to be valid and enforceable, it must
correctly name the contracting owner of the property. Section 71-3-535(3)(c), MCA.
Swain also acknowledges that Cascade was the record owner of the property during
the time Swain performed his work on the property. However, Swain maintains that
under the circumstances of this case, naming Battershell, instead of Cascade, as the
contracting owner does not affect the validity of the construction lien. Swain
advances three arguments to support his position.

¶19. First, Swain argues that construction liens are to be liberally construed in favor
of the lienor. Fausett v. Blanchard (1969), 154 Mont. 301, 308, 463 P.2d 319, 322.
Swain cites Mountain States Resources v. Ehlert (1981), 195 Mont. 496, 503, 636 P.2d
868, 872, for the proposition that naming the agent or project manager of an
undisclosed principal of a building site as the contracting owner on a construction
lien does not affect the validity of the lien. In arguing the applicability of Ehlert to
this case, Swain asserts that Cascade was an undisclosed principal and that
Battershell was the agent of Cascade. Thus, Swain argues, the lien should not fail
simply because Battershell was named as the contracting owner instead of Cascade.

¶20. Second, Swain argues that Montana's construction lien statutes do not require
the contracting owner to be the record owner for purposes of establishing a valid
construction lien. Swain asserts that Battershell qualifies as a "contracting owner" as
that term is defined in § 71-3-522(4)(a), MCA, because Battershell holds an interest
in the mini-mall property. Swain bases this assertion on the fact that BPI currently
owns the mini-mall property and Battershell is president of BPI.

¶21. Lastly, Swain asserts that he relied to his detriment on Battershell's
representation that Battershell owned the mini-mall property. While not explicit, it
appears Swain urges this Court to reverse the District Court's grant of partial

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summary judgment based on the principle of equitable estoppel.

¶22. Before addressing these arguments, we first address Battershell's renewed
motion to dismiss Swain's appeal on the ground that it is moot. Battershell points out
that on January 13, 1997, Swain amended his construction lien to name Cascade as
the contracting owner. Battershell cites Montana and Ninth Circuit cases for the rule
that an amended pleading supersedes the original pleading, and makes the original
pleading functus officio, of no force or effect. See Monarch Lumber Co. v. Haggard
(1961), 139 Mont. 105, 110, 360 P.2d 794, 796; Ferdik v. Bonzelet (9th Cir. 1992), 963
F.2d 1258, 1262. In applying Monarch to this case, Battershell argues that Swain's
amended construction lien superseded the original construction lien thereby making
it of no force or effect. On this basis, Battershell argues that Swain's amended
construction lien renders moot any inquiry into whether the court erred in
determining the invalidity of the original construction lien. We disagree.

¶23. First, a construction lien is not a pleading. Cole v. Hunt (1949), 123 Mont. 256,
261, 211 P.2d 417, 420. This distinction alone renders Monarch inapplicable. Second,
even were we to apply the underlying rationale of Monarch to the instant case, as
Battershell suggests, we are not convinced that the original construction lien would
be superseded. Section 71-3-535(1), MCA, provides in relevant part that a
construction lien does not attach and cannot be enforced unless it was filed within 90
days after the final furnishing of services or materials. Swain last furnished services
or materials on November 30, 1995. The amended construction lien was filed
January 13, 1997, well after the 90-day statutory filing period had lapsed. There
exists no statute providing for "relation back" of amended construction liens. Upon
the foregoing, we hold that Swain's appeal is not moot and we deny Battershell's
renewed motion to dismiss. We turn then to the merits of this issue.

¶24. Our standard of review in appeals from summary judgment rulings is de novo.
Mead v. M.S.B., Inc. (1994), 264 Mont. 465, 470, 872 P.2d 782, 785. When we review
a district court's grant of summary judgment, we apply the same evaluation, based
on Rule 56, M.R.Civ.P., as the district court. Bruner v. Yellowstone County (1995),
272 Mont. 261, 264, 900 P.2d 901, 903. We review a district court's legal conclusions
to determine whether they are correct. Bruner, 272 Mont. at 264, 900 P.2d at 903.

¶25. Pursuant to Montana's construction lien statutes, a person who furnishes
services or materials pursuant to a real estate improvement contract may claim a

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construction lien, only to the extent provided in the statutes, to secure the payment of
the contract price. Section 71-3-523, MCA. The construction lien extends to the
interest of the contracting owner in the real estate as that interest exists at the
commencement of work or is thereafter acquired in the real estate. Section 71-3-525
(1), MCA. A "contracting owner" is one who owns an interest in real estate and who
enters into an express or implied contract for the improvement of the real estate.
Section 71-3-522(4)(a), MCA. A construction lien will not attach unless the lien
statement contains the name of the contracting owner. Section 71-3-535(3)(c), MCA.
A construction lien is not valid unless the lien statement is filed with the county clerk
and a copy of the lien statement, along with a notice of construction lien, is served
upon each owner of record of the property named in the lien. Sections 71-3-534(2)
and -535(2)(b), MCA.

¶26. The purpose of these procedural requirements is to impart notice to the owner
of real property that a lien has been filed against his or her property, and to protect
all parties dealing with the property, including subsequent purchasers. General
Electric Supply Co. v. Bennett (1981), 192 Mont. 110, 115, 626 P.2d 844, 847; Cole,
123 Mont. at 259, 211 P.2d at 419. This Court has consistently held that the
procedural requirements of construction lien statutes will be strictly construed, but
that once the procedure has been fulfilled, the statutes will be liberally construed so
as to give effect to their remedial purpose. General Electric, 192 Mont. at 113-14, 626
P.2d at 846. See also Varco-Pruden v. Nelson (1979), 181 Mont. 252, 593 P.2d 48
(holding that a construction lien is perfected only after full compliance with the lien
statutes). Based upon this rule of strict construction concerning procedure, we have
held that failure to state the owner, or person whose interest in property is sought to
be charged, on the lien statement is fatal to the lien. Cascade Electric Co., Inc. v.
Associated Creditors, Inc. (1950), 124 Mont. 370, 375, 224 P.2d 146, 149; Blose v.
Havre Oil & Gas Co. (1934), 96 Mont. 450, 464-65, 31 P.2d 738, 743; Missoula
Mercantile Co. v. O'Donnell (1900), 24 Mont. 65, 72, 76-78; 60 P. 594, 596.

¶27. Applying these rules to the instant case, we determine that the District Court did
not err in concluding that Swain's construction lien was invalid. The record
demonstrates that at the time Swain filed his construction lien, Cascade was the
owner of the mini-mall property and, hence, the person whose interest was sought to
be charged. The record is void of any evidence showing that Battershell held an
interest in the property. Swain does not cite any authority for the proposition that
Battershell owned an interest in the property simply because he was president of

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BPI, the successor in interest to Cascade. Absent evidence showing that Battershell
held an interest in the property at the time the construction lien was filed, the listing
of Battershell as the contracting owner on the lien statement was fatal to the lien.

¶28. Although we held in Ehlert that naming the agent of an undisclosed principal as
the contracting owner on the lien statement was not fatal to the lien, Ehlert is
distinguishable from the instant case. Our decision in Ehlert includes only a cursory
account of the facts giving rise to that case and we note that some facts are
contradictory. For example, the facts section states that one natural gas lessee (MGE)
was the undisclosed principal of another (MSR), but fails to state the basis of this
agency relationship. Ehlert, 195 Mont. at 499-500, 636 P.2d at 870. Also, the facts
section first indicates that the lien claimant filed a lien against the proceeds of MSR,
but later indicates that the lien was filed against property of MSR and MGE. Ehlert,
195 Mont. at 499-500, 636 P.2d at 870. Without a more coherent statement of the
facts in Ehlert, we have no basis on which to determine that the factual situation of
this case is analogous to that of Ehlert.

¶29. Aside from being unable to discern the factual situation in Ehlert, we note that
Ehlert was decided pursuant to a statutory scheme different from the one involved in
the present case. Ehlert involved an oil and gas lien which was filed pursuant to § 71-
3-1002, MCA. That statute allows a person who has furnished services or materials
with "the owner of any leasehold for oil and gas purposes or the owner of any gas
pipe or oil pipeline or with the trustee or agent of such owner" to file a lien for sums
due and payable against such leasehold or oil and gas pipeline, the equipment used in
the oil or gas extraction, and the proceeds thereto inuring to the "working interest"
therein. Further, the definition of "owner" set forth in § 71-3-1001(3), MCA, is
broader than the definition of "contracting owner" in § 71-3-522(4)(a), MCA. Under
§ 71-3-1001(3), MCA, "owner" includes persons holding any interest in legal or
equitable title, or both, and purchasers under executory contract. In Ehlert, it
appears natural gas leases had been shifted between three different corporate entities
during the period Ehlert furnished his services and filed his lien. Ehlert, 195 Mont. at
501, 503, 636 P.2d at 871, 872. Based on the limited facts reported in Ehlert, we
determine that Ehlert was decided upon facts unique to that case alone. For these
reasons we hold that Ehlert is inapplicable to the instant case.

¶30. Finally, we are not persuaded by Swain's argument concerning equitable
estoppel.

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It is the general rule that in order to predicate an estoppel against a person on the ground
of his nondisclosure of an estate or interest in real property, it must be shown that the party
asserting the estoppel had no knowledge, actual or constructive, of the real condition of
the title to the property in question. It is essential that he was not only destitute of
knowledge of the true state of the title, but also of any convenient and available means of
acquiring such knowledge.

...

[A] person cannot assert an estoppel on the basis of the failure of an owner of an interest
in real estate to disclose such interest while the aggrieved party was carrying on some
transaction relating to such property, if the person seeking to establish the estoppel has
failed to avail himself of the constructive notice afforded by the public records.

28 Am.Jur.2d Estoppel and Waiver §§ 95-96. In this case, Swain had constructive
knowledge of Cascade's ownership of the mini-mall property and had a convenient and
available means of ascertaining such ownership. The warranty deed pursuant to which
Cascade owned the mini-mall property was duly recorded in the Lewis and Clark County
Clerk and Recorder's Office. Had Swain gone to the clerk and recorder's office and
examined the title of the mini-mall property, he would have found that Cascade owned the
property. Under these circumstances, we determine that Swain is not entitled to equitable
estoppel. Upon the foregoing, we hold that there exist no issues of material fact and that
the District Court's grant of partial summary judgment to Battershell was proper.

Issue 2

¶31. Did the court err in granting Battershell his reasonable attorney's fees in defending the construction
lien foreclosure?

¶32. Swain argues that should this Court reverse the District Court's partial
summary judgment ruling, it should also reverse the District Court's grant of
attorney's fees to Battershell. Having determined that the District Court did not err
in granting Battershell's partial summary judgment motion, we hold that the award
of attorney's fees to Battershell was proper.

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B. Battershell's and BPI's Cross-Appeal

Issue 1

¶33. Did the court err in finding that the sidewalk was poured in accordance with industry standards and
that the lack of uniformity in the finish on the sidewalk was caused by rain?

¶34. We review a district court's findings of fact to determine whether the findings
are clearly erroneous. Rule 52(a), M.R.Civ.P.; In re Marriage of Pfeifer (1997), 282
Mont. 461, 467, 473, 938 P.2d 684, 688, 692. A finding is clearly erroneous only if it is
not supported by substantial evidence, the trial court misapprehended the effect of
the evidence, or our review of the record convinces us that a mistake has been
committed. In re Marriage of Stufft (1996), 276 Mont. 454, 459, 916 P.2d 767, 770.
We have defined substantial evidence as "evidence that a reasonable mind might
accept as adequate to support a conclusion; it consists of more than a mere scintilla
of evidence but may be somewhat less than a preponderance." Barrett v. Asarco Inc.
(1990), 245 Mont. 196, 200, 799 P.2d 1078, 1080. In determining whether a finding of
fact is clearly erroneous, "due regard shall be given to the opportunity of the trial
court to judge of the credibility of the witnesses." Rule 52(a), M.R.Civ.P.

¶35. The evidence and testimony produced at trial showed that the sidewalk did not
have a uniform fine broom finish. Some areas of the sidewalk had a fine broom
finish, but others had a rough broom finish. Neither party disputed this fact. The
parties disputed only the cause of the lack of uniformity in the fine broom finish.
Battershell argued that contractor error caused the problem with the finish while
Swain argued that rain caused the problem. Both Battershell and Swain produced
experts at trial to give opinions concerning the cause of the lack of uniformity in the
fine broom finish. At the conclusion of the presentation of evidence, the court found
that rain caused the lack of uniformity in the fine broom finish and found that Swain
poured the concrete according to industry standards. Battershell contends that
substantial evidence does not exist to support these findings. We disagree.

¶36. Three members of Swain's crew who had worked on pouring and finishing the
sidewalk testified that although the rainy conditions affected the finish on some areas
of the sidewalk, the sidewalk was nonetheless an acceptable product. One crew
member, Carl Mayes, who has eleven years experience in the concrete finishing

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industry, testified that the broom finish was applied in a workmanlike manner.
Another crew member, Edwin Swain, testified that he did not observe any problems
such as "scaling marks."

¶37. Two expert witnesses testified on Swain's behalf. Thomas Harrison (Mr.
Harrison) owns a concrete finishing business in Helena and has 23 years experience
in concrete finishing. Peter Ryan (Mr. Ryan), who is the Vice-President of
Operations for Greenway Enterprises, Inc., a local general contractor, has 18 years
experience in the construction industry and has supervised concrete finishing
subcontractors numerous times. Both Mr. Harrison and Mr. Ryan testified that upon
examining the sidewalk, they observed that the sidewalk was level, its edges were
straight, and the broom finish was acceptable. Mr. Harrison stated that he observed
no humps, bumps, discoloration, or trowel marks in the sidewalk. Both experts stated
that the lack of uniformity in the fine broom finish was not a safety hazard and was
no cause for concern. Both experts opined that the sidewalk had been poured and
finished in accordance with generally acceptable practices in the concrete finishing
industry. Mr. Ryan added that he would not recommend pouring concrete in the
rain. He stated that in his opinion, the owner should accept responsibility for any
problems caused by the weather.

¶38. Battershell's expert, Jerry Bowser (Mr. Bowser), who is a professional materials
engineer with Maxim Technologies in Helena and who often acts as a consultant on
concrete finishing projects, noted that the concrete used by Swain contained an
additive called Posi-tech 20 and noted that Swain mixed the concrete with hot water.
He stated that the use of Posi-tech 20 and hot water made the concrete set faster than
normal. He opined that the lack of uniformity in the fine broom finish was caused by
the concrete setting faster than Swain's crew could finish it. However, on cross-
examination, Mr. Bowser admitted that humidity and the presence of visqueen over
the concrete also affect the rate at which concrete sets. He testified that the presence
of rainwater on concrete will lengthen the set time for the top quarter inch of the
concrete. Mr. Bowser testified there are three types of broom finishes: fine, medium,
and heavy. When asked what type of broom finish he would recommend for a
commercial use building, Mr. Bowser recommended a medium to heavy broom
finish. Mr. Bowser testified that upon examining the sidewalk, he observed a finish
that was between fine and heavy.

¶39. Both Swain and Battershell submitted evidence concerning the cause of the lack

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of uniformity in the fine broom finish of the sidewalk. The court believed Swain's
evidence to be more credible. In non-jury trials, it is the duty and function of the
District Court to resolve conflicts in evidence. In re Marriage of Wessel (1986), 220
Mont. 326, 333, 715 P.2d 45,50. The credibility of witnesses and the weight to be
afforded their testimony is a matter left to the sound discretion of the District Court.
Rule 52(a), M.R.Civ.P.; Keebler v. Harding (1991), 247 Mont. 518, 523, 807 P.2d
1354, 1357. Based on the record, we determine that substantial evidence exists to
support the District Court's findings, that the court did not misapprehend the effect
of the evidence, and that no mistake has been committed.

¶40. Next, Battershell argues that the above findings were erroneous because they
were based on a theory of quantum meruit, and Swain never pleaded quantum
meruit. Our review of the record reveals that Swain advanced the theory of quantum
meruit, or unjust enrichment, in the parties' joint proposed pre-trial order. The pre-
trial order provides that it shall supersede the pleadings and govern the course of the
trial of the case, unless modified to prevent manifest injustice. Battershell did not
move to modify the pre-trial order. We also note that Swain again advanced the
theory of quantum meruit in his proposed findings of fact and conclusions of law
submitted to the court. Battershell did not object. Based on these facts, Battershell's
claim that the court's findings were outside the pleadings is without merit. Upon the
foregoing, we hold that the court's findings that rain caused the lack of uniformity in
the fine broom finish and that the sidewalk was poured in accordance with industry
standards were not clearly erroneous.

Issue 2

¶41. Did the court err in determining that BPI did not have standing to bring a counterclaim because it
was not the party with whom Swain had contracted?

¶42. BPI counterclaimed in this action to recover damages for breach of contract,
promissory estoppel, breach of the covenant of good faith and fair dealing, and
fraud. These claims proceeded to trial but were not ruled upon because the District
Court determined that BPI did not contract with Swain and, therefore, did not have
standing to sue. BPI assigns error to the court's conclusion.

¶43. The court based its conclusion on the facts that Battershell was the general

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contractor overseeing construction of the mini-mall, Battershell signed his own name
to the construction contract, and there is no reference on the document that he was
signing it on behalf of BPI. Further, Swain notes that Battershell represented that he
owned the mini-mall property, and never mentioned the existence of BPI during any
conversation with Swain. Although Battershell testified at trial that BPI was the
general contractor overseeing construction of the mini-mall, this testimony does not
provide a basis for finding error. The credibility of witnesses and the weight to be
afforded their testimony is a matter left to the sound discretion of the District Court.
Rule 52(a), M.R.Civ.P.; Keebler, 247 Mont. at 523, 807 P.2d at 1357. Based on the
above facts, we conclude that the court did not err in determining that BPI was not
the party with whom Swain contracted and that BPI was not entitled to contract
damages.

¶44. Affirmed.

/S/ WILLIAM E. HUNT, SR.

We Concur:

/S/ KARLA M. GRAY

/S/ JIM REGNIER

/S/ TERRY N. TRIEWEILER

/S/ JAMES C. NELSON

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