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No. 01-034
IN THE SUPREME COURT OF THE STATE OF MONTANA
2001 MT 206
STUART ESCHENBACHER, d/b/a
CASCADE LOG HOMES,
Plaintiff/Counter-Defendant
and Appellant,
v.
JAMES C. ANDERSON,
Defendant/Counterclaimant
and Respondent.
APPEAL FROM: District Court of the Eighth Judicial District,
In and for the County of Cascade,
The Honorable Thomas McKittrick, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Patrick F. Flaherty, Attorney at Law, Great Falls, Montana
For Respondent:
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Douglas DiRe, Dayton Law Firm, Anaconda, Montana
Submitted on Briefs: July 12, 2001
Decided: October 11, 2001
Filed:
__________________________________________
Clerk
Justice Jim Regnier delivered the Opinion of the Court.
¶1 Stuart Eschenbacher appeals from the Findings of Fact, Conclusions of Law and Order
of the Montana Eighth Judicial District Court, Cascade County, concluding that
Eschenbacher breached a purchase contract between Eschenbacher (d/b/a Cascade Log
Homes) and James C. Anderson and that the proper remedy is to rescind the contract. We
affirm and remand for determination and award of Anderson's attorney's fees and costs on
appeal.
¶2 We find the following issues are dispositive of this appeal:
¶3 Whether the District Court erred in failing to interpret the contract as requiring
Anderson to provide the name of his boom truck operator?
¶4 Whether the District Court erred in failing to rule that Anderson must pay for
completion of the log shell before Anderson can claim a breach of contract?
¶5 Whether the District Court erred in rescinding the contract?
BACKGROUND
¶6 This dispute traces back to early March 1999, when James C. Anderson contacted
Stuart Eschenbacher about the construction of a log home. Eschenbacher, along with his
wife Barbara Eschenbacher, operates Cascade Log Homes. Cascade Log Homes is in the
business of designing and constructing log homes. Eschenbacher has built more than 20
log homes, which he typically constructs in his yard in Cascade, Montana. Almost all of
these structures are then reassembled at their final building site, away from his yard in
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Cascade.
¶7 On March 19, 1999, Eschenbacher and Anderson entered into a written purchase
contract for the construction of a log home. Eschenbacher drafted the agreement, and the
two parties reviewed it together at some length in Eschenbacher's home prior to signing.
The parties agreed to a total purchase price of $28,000, which Anderson was to pay in four
installments. Under the terms of the contract, Eschenbacher was to construct the log home
in his yard and then deliver the structure to Anderson's building site on Georgetown Lake,
Montana. The contract required Anderson to have the building site ready for the log home
at the time of delivery and "make arrangements for all persons necessary to erect the log
structure at the site." Eschenbacher was to provide assistance and supervision during the
assembly of the log structure.
¶8 Of particular importance were the following terms of the purchase contract concerning
the transport and assembly of the log home:
¶9 BUYER will act as his own contractor and is responsible for obtaining all
building permits, and ensuring compliance with all building codes and restrictions
imposed by law or covenant. BUYER acknowledges that CASCADE LOG HOMES
is acting soley [sic] as a manufacturer and that any advise [sic] provided by
CASCADE LOG HOMES or its agents, during the erection of the prefabricated log
structure at the property of the BUYER, is merely an assistance as the manufacturer
and will not be construed as though CASCADE LOG HOMES were a contractor.
CASCADE LOG HOMES agrees and will provide supervision, consultation, and
assistance to BUYER during the erection of the log structure which is part of the
contract price.
¶10 3. BUYER'S OBLIGATION UPON DELIVERY: BUYER will have the
foundation ready for the log structure at the time the logs are delivered to the site,
and also agree to provide insulation required for the assembly of the log structure at
this time. BUYER will make arrangements for all persons necessary to erect the log
structure at the site. BUYER will coordinate and assure availability of a boom truck
to assemble the log structure at the building site, and will provide all other
equipment necessary for the erection of the log structure at the BUYER'S expense.
BUYER will be responsible for the layover charge, if any, for the transportation
truck if the allotted time is exceeded.
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¶11 Pursuant to the terms of the contract, Anderson made an initial down-payment on
March 19, 1999, of $16,500 to Eschenbacher for the purchase of logs and made a second
payment of $3,800 on June 7, 1999, as Eschenbacher began construction of the log home.
¶12 Eschenbacher testified that, in the past, he had constructed homes in his yard with a
backhoe, tractor or bucket truck. This equipment, however, was not sufficient for
constructing Anderson's home. Anderson's log home consists of three interior walls, a
layout that Eschenbacher had never constructed before. In order to assemble such a home,
and any future homes with a similar design, Eschenbacher purchased a boom truck for
$17,000. This boom truck has a lift capability of six tons and a reach capability of sixty
feet.
¶13 While Eschenbacher set about constructing the log home, Anderson built a foundation
at Georgetown Lake at a cost of approximately $20,000 and purchased $11,093.59 worth
of building supplies, including insulation, windows and doors. Apparently, these supplies
still sit unused at the site on Georgetown Lake. Anderson also made arrangements with his
four sons to assist him with assembling the log home. At no time during the construction
did Eschenbacher ever inspect the site on Georgetown Lake.
¶14 In early June 1999, Anderson made arrangements with a boom truck operator,
Woodrow Driver, to assemble his log home. Anderson told Driver the dimensions of his
home, and Driver responded that his boom truck was capable of doing the job. Driver's
truck had a lift capability of around 8,000 pounds without the boom extended and around
1,500 pounds with the lift extended. The reach capability of the boom truck was around 50
feet.
¶15 Sometime around June 25, 1999, a dispute arose over the adequacy of Driver's boom
truck. Anderson claims that, prior to completion of the log home, Eschenbacher informed
Anderson that he was going to use his newly acquired boom truck to assemble the log
home at Georgetown Lake. The cost of such services would be $750. Anderson refused to
use Eschenbacher's truck, as he had already made arrangements with Driver.
¶16 Eschenbacher then asked Anderson for the name and contact information for
Anderson's boom truck operator. Anderson refused to provide this information and said
that the boom truck was his responsibility. Eschenbacher responded by refusing to deliver
the log home to Georgetown Lake. He then told Anderson that he wanted the lawyers to
work out this disagreement.
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¶17 Anderson claims that Eschenbacher was attempting to pressure him into using
Eschenbacher's new boom truck. Anderson maintains that he had no duty to provide
Eschenbacher with information regarding Driver and that Driver assured Anderson that his
boom truck would be adequate. Furthermore, Anderson claims that if Driver's boom truck
proved to be inadequate once the log home arrived, he was willing to acquire a different
one. Anderson also insists that he would have provided a specific type of boom truck from
the beginning if the contract had required it. Eschenbacher denies that he was pressuring
Anderson into using his boom truck and contends that his request for the name and contact
information of the boom truck operator was simply for safety reasons. He testified that it is
his general practice to ask for such information.
¶18 Eschenbacher filed suit against Anderson on October 20, 1999, for breach of contract.
On February 11, 2000, Anderson filed an Answer and Counterclaim. The Counterclaim
alleged five claims, including breach of contract. On July 28, 2000, the parties stipulated
that only the breach of contract claim should be tried before the District Court.
¶19 The District Court held a bench trial on August 21, 2000, and issued its Findings of
Facts, Conclusions of Law and Order on December 29, 2000, in favor of Anderson. In its
findings, the District Court concluded that Eschenbacher materially breached the contract
by refusing to deliver Anderson's log home. In making its decision, the District Court
found that if Eschenbacher discovered the boom truck to be inadequate upon delivery, he
could have refused to unload the logs from his truck and charge Anderson for any
subsequent delay as Anderson acquired a more adequate boom truck. The contract
anticipated such a delay, according to the District Court, as it specifically provided that
Anderson must pay for any excess layover time Eschenbacher's transportation truck
incurred. The District Court further concluded that Eschenbacher could have avoided this
dispute by enumerating specific requirements for the boom truck in the agreement.
¶20 The District Court held that Anderson was relieved of any further obligations under
the contract. The District Court also held that Anderson was entitled to rescission of the
contract and to attorney's fees and costs. Eschenbacher appeals the findings of the District
Court.
STANDARD OF REVIEW
¶21 The construction and interpretation of a written agreement are questions of law. See, e.
g., In re Estate of Hill (1997), 281 Mont. 142, 145, 931 P.2d 1320, 1323 (citations
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omitted). It is also a question of law whether ambiguity exists in a written agreement. See
Estate of Hill, 281 Mont. at 146, 931 P.2d at 1323 (citations omitted). We review a district
court's conclusions of law to determine whether the court's interpretation is correct. See
Carbon County v. Union Reserve Coal Co. (1995), 271 Mont. 459, 469, 898 P.2d 680, 686
(citations omitted).
¶22 The determination of whether a party materially breached a contract is a question of
fact. See Sjoberg v. Kravik (1988), 233 Mont. 33, 38, 759 P.2d 966, 969. We review a
district court's findings of fact to determine whether they are clearly erroneous. See Daines
v. Knight (1995), 269 Mont. 320, 324, 888 P.2d 904, 906 (citing Columbia Grain Int'l v.
Cereck (1993), 258 Mont. 414, 417, 852 P.2d 676, 678). A finding is clearly erroneous if
substantial evidence does not support it, if the district court misapprehended the effect of
the evidence, or, if after reviewing the record, this Court is left with a firm conviction that
a mistake has been made. See Interstate Prod. Credit Ass'n v. DeSaye (1991), 250 Mont.
320, 323, 820 P.2d 1285, 1287.
ISSUE ONE
¶23 Whether the District Court erred in failing to interpret the contract as requiring
Anderson to provide the name of his boom truck operator?
¶24 A court must interpret a contract in such a way that makes it lawful and reasonable, so
long as it can be done without violating the intent of the parties. See § 28-3-201, MCA.
Courts have no authority to insert or delete provisions of a contract where the contract's
provisions are unambiguous. See Topco, Inc. v. State (1996), 275 Mont. 352, 358, 912
P.2d 805, 809 (citations omitted). Where the meaning of a contract is ambiguous, this
Court has repeatedly followed the rule that a court should interpret a contract most
strongly against the party who drafted the agreement. See Ophus v. Fritz, 2000 MT 251,
¶31, 301 Mont. 447, ¶31, 11 P.3d 1192, ¶31 (citations omitted).
¶25 In the case before us, Eschenbacher drafted the purchase contract. The language
specifically states that Anderson "is responsible for obtaining all building permits, and
ensuring compliance with all building codes and restrictions imposed by law or covenant."
The contract further requires Anderson to "coordinate and assure availability of a boom
truck to assemble the log structure at the building site, and . . . [Anderson] will be
responsible for the layover charge, if any, for the transportation truck if the allotted time is
exceeded." The obligations of Cascade Log Homes, under the contract, are limited to
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providing "supervision, consultation, and assistance to BUYER during erection of the log
structure." The contract requires Anderson to acknowledge that Cascade Log Homes is
acting only as a manufacturer and any advice it gives during construction is merely
assistance. Such advice, according to the contract, shall not construe Cascade Log Home's
performance as that of a contractor.
¶26 Eschenbacher argues that the District Court erred in not implying a requirement into
the contract that Anderson provide information about the boom truck operator. To require
him to perform under the contract without such information, according to Eschenbacher,
would be unsafe and commercially unreasonable. Eschenbacher insists that he would
violate various federal and state safety laws if an inadequate boom truck was used during
the construction of the log home. He also argues that the language "BUYER will
coordinate and assure availability of a boom truck" requires Anderson to coordinate
acquisition of the boom truck with Eschenbacher.
¶27 In affirming the District Court's findings, we do not need to confront Eschenbacher's
first contention that using an inadequate boom truck would subject him to various
liabilities. The District Court's ruling simply does not require Eschenbacher to take such a
risk. As the District Court interprets the contract, Eschenbacher could refuse to unload the
log home from the transportation truck until Anderson obtained an adequate boom truck.
The District Court supported its conclusion by noting that the contract envisioned such a
delay by requiring Anderson to pay for any expenses incurred by Eschenbacher for
waiting. Furthermore, the District Court notes that Eschenbacher could have avoided this
dispute if he had requested specific requirements about the boom truck in the contract.
¶28 Where the meaning of a contract is ambiguous, a court should interpret a contract
most strongly against the party who drafted the agreement. See Ophus, ¶31 (citations
omitted). Given this standard of review, we find it reasonable to assume that the contract
sought to protect Eschenbacher from an inappropriate boom truck not by placing strict
requirements on Anderson, but by exposing him to economic risk for any delay caused by
acquiring an inappropriate boom truck.
¶29 Eschenbacher has built numerous homes that he later delivered to off-site building
locations. He therefore should know what information he would need in order to carry out
his obligations under the contract. The contract clearly placed the responsibility for
acquiring a boom truck with Anderson. The contract plainly states that Anderson is
responsible for any costs incurred by Eschenbacher for delay at the building site. It is
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conspicuously blank, however, as to specific requirements of the boom truck. Even if
Eschenbacher was responsible for assembly of the log home once at the site, an issue that
we need not address, the contract simply does not require him to use the boom truck
Anderson acquires. While it could be a costly proposition to deliver the log home and then
wait until Anderson secured an adequate boom truck, we believe the contract intended to
place this cost with Anderson.
¶30 As for Eschenbacher's second contention, we disagree that the language "BUYER
shall coordinate" necessarily requires Anderson to involve Eschenbacher with the
acquisition of the boom truck or to provide him with information concerning its driver
prior to delivery. The contract placed responsibility for the boom truck with Anderson and
limited Eschenbacher's involvement. Again, where the meaning of a contract is
ambiguous, a court should interpret a contract most strongly against the party who drafted
the agreement. See Ophus, ¶31 (citations omitted). We therefore interpret the language to
mean only that Anderson will simply coordinate the availability of the boom truck with
the boom truck operator.
¶31 Accordingly, we agree with the District Court's conclusion that under the terms of the
purchase contract Anderson was under no duty to provide Eschenbacher with the name of
the boom truck operator.
ISSUE TWO
¶32 Whether the District Court erred in failing to rule that Anderson must pay for
completion of the log shell before Anderson can claim a breach of contract?
¶33 The District Court held that Eschenbacher materially breached the contract by
refusing to deliver the log home and telling Anderson that he wanted lawyers to settle their
dispute over the boom truck. The District Court then concluded that, once Eschenbacher
had breached the contract, Anderson was under no further obligation to pay for the
completion of the log home.
¶34 Eschenbacher argues that his refusal to deliver the log home could not be a breach of
contract as his delivery obligation was contingent on Anderson tendering a completion
payment of $3,800. Stated another way, Eschenbacher argues that this payment was a
condition precedent to his duty to deliver the log home. Eschenbacher further argues that
Anderson's failure to make the completion payment estopped Anderson from claiming a
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breach of contract claim for Eschenbacher's failure to deliver the log structure.
¶35 A condition precedent is "one which is to be performed before some right dependent
thereon accrues or some act dependent thereon is performed." Section 28-1-403, MCA.
Before a party may require another party to perform under an obligation, the requesting
party must fulfill all conditions precedent required of the requesting party. See § 28-1-406,
MCA. The law, however, does not require a party to an agreement to perform a useless
act. See Restatement (Second) of Contracts § 255 cmt. a (1981). If a party to a contract
repudiates his contractual duty prior to his obligation to perform, the other party may
enforce the obligation without performing or offering to perform any of her obligations.
See § 28-1-407, MCA. Such a repudiation of a party's obligations is an anticipatory breach
of contract. See Chamberlin v. Puckett Construction (1996), 277 Mont. 198, 202, 921 P.2d
1237, 1240. To support an action for anticipatory breach, a party's repudiation must be
entire, absolute and unequivocal. See Chamberlin, 277 Mont. at 202, 1237 P.2d at 1239-
40.
¶36 A repudiation is accorded the same effect as a breach by nonperformance. See
Restatement (Second) of Contracts § 255 cmt. a (1981). Strictly speaking, however, a
present breach does not have the same effect as an anticipatory breach. A party generally
cannot be liable for a present breach for failure to perform under a contract if that party's
obligation to perform is contingent on a condition precedent that has yet to occur. See
Management, Inc. v. Mastersons, Inc. (1980), 189 Mont. 435, 440-41, 616 P.2d 356, 360.
If a party's failure to perform, however, constitutes an anticipatory breach of contract, the
other party is relieved of his duty to perform any condition precedent before bringing his
claim. See Chamberlin, 277 Mont. at 202, 1237 P.2d at 1240.
¶37 There is no dispute that the contract requires a completion payment prior to
Eschenbacher delivering the log home to Georgetown Lake. The contract states, in part,
that a "payment of $3,800 (three thousand, eight hundred dollars and no cents) will be paid
upon completion of the log structure at the Cascade manufacturing site." Anderson,
however, asserts that Eschenbacher refused to deliver the log home before its completion,
thus relieving him of his duty to deliver the $3,800. In support of his claim, Anderson's
attorney introduced Mrs. Eschenbacher's deposition testimony during trial. In that
testimony, Mrs. Eschenbacher stated that she and her husband did not deliver the log home
on its completion date because Anderson and his sons came out "before it was finished."
Mrs. Eschenbacher went on to state, "[a]nd at that time there was the disagreement about
the bucket truck being used. And at that time Mr. Anderson and my husband agreed to
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have the attorneys settle it." Thus, we conclude there is sufficient evidence on the record
to support the District Court's finding that the dispute over the boom truck arose prior to
the completion of the log home.
¶38 We have previously stated that "a party acts at his peril if, 'insisting on what he
mistakenly believes to be his rights, he refuses to perform his duty.'" Chamberlin, 277
Mont. at 203, 921 P.2d at 1240 (quoting United California Bank v. Prudential Ins. Co.
(Ariz. App.1983), 681 P.2d 390, 430 (quoting Restatement (Second) of Contracts § 250
cmt. d (1981))). A party's demand for performance for a term not contained in the contract,
accompanied by an unequivocal statement that the demanding party will not perform
unless the other party meets the additional term, constitutes an anticipatory breach of
contract and excuses performance by the other party. See Chamberlin, 277 Mont. at 203,
921 P.2d at 1240. In a case with facts substantially similar to those before us, we
concluded that a party's unauthorized demand for performance and accompanying refusal
to perform without the other party's compliance with that demand constitute a clear and
unequivocal repudiation of his contractual duty to perform and therefore constitutes an
anticipatory breach of contract. See Chamberlin, 277 Mont. at 205, 921 P.2d at 1241
(holding that party's failure to perform unless other party complied with its demands
constituted clear and unequivocal repudiation of its contractual duty to perform).
¶39 In the case before us, Eschenbacher clearly refused to deliver the log home if
Anderson did not provide him the contact information of the boom truck operator. As we
discuss above, this refusal occurred prior to Anderson's duty to tender the completion
payment. In fact, in his Reply Brief, Eschenbacher states that the "only impediments to
delivery were Mr. Anderson giving the name of his boom truck operator" [sic]. A
requirement that Anderson provide the name of the boom truck operator was not a term of
the contract. We hold, therefore, that Eschenbacher's actions constituted an anticipatory
breach of contract.
¶40 We would note that the District Court did not articulate the distinction between a
present breach and an anticipatory breach in its decision. The District Court simply stated
that Eschenbacher breached the contract and Anderson was thus excused from making any
further payments. We will affirm a district court's ruling, however, if the court reaches the
correct result, even if it does so for the wrong reason. See State v. Parker, 1998 MT 6, ¶20,
287 Mont. 151, ¶20, 953 P.2d 692, ¶20 (citation omitted). Therefore, we hold that
Eschenbacher committed an anticipatory breach of contract and Anderson was thus
excused from the obligation to pay for the log shell before seeking to rescind the contract.
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ISSUE THREE
¶41 Whether the District Court erred in rescinding the contract?
¶42 A party may seek rescission when, through the fault of the other party, the
consideration of his obligation fails in whole or in part. See § 28-2-1711, MCA. We have
held that a party's consideration fails when that party's failure to perform was material to
the contract. See Norwood v. Service Distributing, Inc., 2000 MT 4, ¶33, 297 Mont. 473,
¶33, 994 P.2d 25, ¶33. Furthermore, a party's material failure to perform must actually
damage the party claiming the right to rescind. See Norwood, ¶26. Finally, a party must
bring his claim for rescission promptly upon discovering the facts that entitle him to
rescind the contract. See § 28-2-1713, MCA, Norwood, ¶48.
¶43 The District Court held that Eschenbacher's refusal to deliver the log home and
demand that lawyers settle the dispute was a material breach of the contract. Our standard
of review requires us to consider the evidence in a light most favorable to the prevailing
party. See Roberts v. Mission Valley Concrete Indus. (1986), 222 Mont. 268, 271, 721
P.2d 355, 357. Therefore, we affirm the District Court's determination that Eschenbacher's
refusal to deliver the log home, which was the very item that the purchase contract
contemplated he construct and deliver, was material to the contract.
¶44 The District Court also held that Anderson suffered damages from Eschenbacher's
breach. Anderson presented testimony and evidence that he spent more than $11,000 on
building supplies, more than $20,000 on construction of the foundation and a total of
$20,300 to Eschenbacher under the contract. We conclude that the District Court's findings
concerning damages are not clearly erroneous.
¶45 Eschenbacher's principal argument against the award of rescission centers around the
timeliness of the claim. In Liddle v. Petty (1991), 249 Mont. 442, 448, 816 P.2d 1066,
1069-70, we upheld a decision of a district court that held that the buyer, Petty, could not
suspend his performance under a contract for deed because he failed to use reasonable
diligence to rescind the contract upon discovering facts upon which he had such a right.
Petty stopped making payments because of what he felt was a material breach by the
Liddles when they failed to assist him in obtaining a mortgage release from the bank as
promised in the contract. Petty did not notify the Liddles of his failure to obtain the
release, however, for more than two years after the parties signed the contract. See Liddle,
249 Mont. at 448, 816 P.2d at 1069; see also Norwood, ¶¶49-51 (remanding back to the
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district court for further findings regarding timeliness of claim of rescission under facts
similar to Liddle).
¶46 While we continue to hold that a party must bring a claim of rescission in a timely
manner, we find that the facts before us are distinguishable from Liddle. In that case the
party continued to make payments years after discovering facts that supported his claim of
rescission. While there is some dispute in the case before us as to whether the log home
was completed prior to Eschenbacher's refusal to deliver the log home, there is no dispute
that Anderson refused payment upon learning of Eschenbacher's refusal. There is
testimony from Anderson that indicates he made some futile attempts at resolving their
dispute and reviving the contract with Eschenbacher. Unlike in Liddle, however, Anderson
stopped all performance under the contract upon discovery of Eschenbacher's refusal to
perform.
¶47 We have held in the past that formal notice of rescission is not always a requisite to
rescinding a contract. See Bozdech v. Montana Ranches Co. (1923), 67 Mont. 366, 380,
216 P. 319, 322. Rather, it is only necessary that the party electing to rescind makes a
timely communication of that intention, in some manner, and bringing an action promptly
is generally held sufficient. See Bozdech, 67 Mont. at 380, 216 P. at 322. We conclude
there is substantial evidence to indicate that Anderson considered the contract over and, by
ceasing further payments under the contract, communicated this to Eschenbacher.
Anderson's subsequent attempts at resolving their dispute do not rise to such a level that
should disturb this conclusion.
¶48 We also do not find error in the District Court's failure to specifically state that
Anderson timely made his claim of rescission. We adhere to the doctrine of implied
findings where, as here, the trial court's findings are general in terms. See Berry v. Romain
(1981), 194 Mont. 400, 407, 632 P.2d 1127, 1132. Any findings not specifically made but
necessary to the judgment are deemed to have been implied if supported by the evidence.
See Berry, 194 Mont. at 407, 632 P.2d at 1132. There is substantial evidence in the record
to show that Anderson refused to make further payments under the contract upon his
discovery that Eschenbacher refused to deliver the log home.
¶49 Finally, Eschenbacher asserts that specific performance was a more appropriate
remedy in this case. Eschenbacher supports this assertion by noting that the log home is
completed and was designed specifically for Anderson. This court has long held that a
party may pursue any remedy that the law affords, in addition to the remedy the contract
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affords, unless the contract declares the remedy to be exclusive. See White v. Jewett
(1938), 106 Mont. 416, 420, 78 P.2d 85, 87, Kootenai Corp. v. Dayton (1979), 184 Mont.
19, 25, 601 P.2d 47, 50, Jensen v. Sire (1960), 137 Mont. 391, 395, 352 P.2d 263, 265.
The disputed contract before us does not specify a remedy, and, for the reasons we set
forth above, rescission is an available remedy. Rescission was the relief requested by
Anderson and the District Court was correct in granting it.
¶50 For the foregoing reasons, we conclude that there is substantial evidence on the record
to affirm the District Court's award of rescission of the contract.
¶51 Anderson requests that costs and attorney's fees on appeal be awarded. Courts
automatically award costs on appeal in civil actions to the prevailing party. See Rule 33(a),
M.R.App.P. In addition, this Court has held that, where an award of attorney's fees is
based on a contract, the prevailing party is entitled to his reasonable attorney's fees on
appeal. See Smith v. Johnson (1990), 245 Mont. 137, 145, 798 P.2d 106, 111 (citations
omitted). Thus, we hold that Anderson is entitled to an award of attorney's fees and costs
on appeal.
¶52 We note in passing that Eschenbacher objects to the District Court's award of
attorney's fees. In its findings, the District Court held that Anderson's expenditure of
$7,500 in attorney's fees was reasonable and awarded this amount. It is well settled that we
will not address an issue on appeal that a party did not properly raise in the district court.
See Nason v. Leistiko, 1998 MT 217, ¶11, 290 Mont. 460, ¶11, 963 P.2d 1279, ¶11
(citations omitted). Eschenbacher did not raise the issue of attorney's fees at any stage of
the trial, nor did he raise the issue in any post-trial hearings or post-trial memoranda
presented to the District Court. Instead, he raises the issue only now on appeal. Therefore,
we decline to address the issue of the reasonableness of the attorney's fees awarded.
¶53 We affirm the decision of the District Court and remand for determination and award
of Anderson's costs and attorney's fees on appeal.
/S/ JIM REGNIER
We Concur:
/S/ KARLA M. GRAY
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/S/ PATRICIA COTTER
/S/ TERRY N. TRIEWEILER
/S/ JAMES C. NELSON
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