No. 01-048
IN THE SUPREME COURT OF THE STATE OF MONTANA
2002 MT 176
VIRGINIA CITY, a Municipal corporation,
and Political Subdivision of the State of Montana,
Plaintiff and Respondent,
v.
GREG OLSEN and PHILLIP MASON, JR.,
Defendants and Appellants.
APPEAL FROM: District Court of the Fifth Judicial District,
In and for the County of Madison,
The Honorable Frank M. Davis, Judge presiding.
COUNSEL OF RECORD:
For Appellants:
John P. Poston, Attorney at Law, Helena, Montana
For Respondent:
William A. Hritsco, Attorney at Law, Dillon, Montana
Submitted on Briefs: October 11, 2001
Decided: August 8, 2002
Filed:
__________________________________________
Clerk
Justice Jim Regnier delivered the Opinion of the Court.
¶1 The town of Virginia City, Montana, brought this action in the
Montana Fifth Judicial District Court, Madison County, to enjoin
construction of a structure therein on Lots 11 and 12, Block 201,
based upon alleged permit violations. The District Court awarded
summary judgment to Virginia City, permanently enjoined further
construction on the lots, and ordered that the existing structure
thereon be removed. Greg Olsen (“Olsen”), the owner of the lots,
and Phillip Mason, Jr., (“Mason”), the general contractor, appeal
from the District Court’s December 19, 2000, Judgment. We reverse
and remand for further proceedings consistent with this Opinion.
¶2 The following issue is dispositive of the appeal:
¶3 Did the District Court err in awarding Virginia City summary
judgment without affording Olsen and Mason a hearing?
BACKGROUND
¶4 In the Spring of 1999, Mason, a general contractor and
resident of Virginia City, agreed to assist Olsen in constructing a
personal residence on Lots 11 and 12, Block 201, in Virginia City.
To construct a new structure in Virginia City, development and
site zoning permits are required pursuant to Virginia City’s Design
and Site Zoning Ordinance (“Ordinance 503"). In May 1999, Mason
applied for both permits on behalf of Olsen.
¶5 Upon Mason’s request for permits, Virginia City’s Historic
Preservation and Enforcement Officer (“HPO”), Chandler Simpkins
(“Simpkins”), directed Mason to provide a scaled plat indicating
generally where and how the proposed structure would be situated on
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the lots. In response to Simpkins’ instruction, Mason prepared and
submitted a drawing showing the dimensions of the structure and the
proposed setbacks of the structure from Warren and Fairweather
Streets, the two public streets abutting Olsen’s lots.
Additionally, Mason submitted two sketches illustrating plans for
the exterior of the structure.
¶6 On June 15, 1999, the Virginia City Historic Preservation
Advisory Committee (“HPAC”) held a meeting to consider Mason’s
requests for permits. HPAC rejected Mason’s sketch depicting the
rear of the structure after reviewing his sketches for compliance
with Ordinance 503, the “Design Review Guidelines for the Town of
Virginia City, Montana” (“the Guidelines”), and the Virginia City
Code, Titles 11 and 15 (“the Code”). HPAC supplanted Mason’s
sketch with its own illustrating the addition of decking on the
rear of the structure and different windows. After visiting the
lots and amending Mason’s submitted sketch, HPAC approved the
permits. As amended, the permit applications were approved by the
Town Council on June 17, 1999. Mason commenced construction after
receiving approval from the Town Council.
¶7 On or about July 26, 1999, residents of Virginia City orally
complained that the structure was not in compliance with setback
requirements. On August 3 and August 4, 1999, HPO, Carl Donahue
(“Donahue”), investigated alleged setback violations by measuring
the setback of the structure from Warren Street. Thereafter,
Donahue advised Mason that he was allegedly in violation of setback
requirements. On August 4, 1999, Olsen’s neighbors submitted a
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written complaint to the Virginia City Board of Adjustments stating
that the structure did not appear to meet setback requirements.
¶8 On August 11, 1999, Donahue sent a written request to Mason to
immediately cease construction. On August 13, 1999, the Town
Council sent a letter to Olsen requesting that construction cease
and that the parties meet to seek a resolution.
¶9 Virginia City commissioned a survey to measure the setbacks
and the height of the structure. David Bowman (“Bowman”) conducted
the survey on August 21 and August 29, 1999.
¶10 On August 25, 1999, after obtaining the results of the survey,
the Town Council revoked the building permits and sent notices to
Olsen and Mason on August 26, 1999, stating that Virginia City was
seeking an injunction to prevent further construction on the lots.
On September 2, 1999, Virginia City filed a complaint and
application for a preliminary injunction in the District Court
against Olsen, as owner, and Mason, as Olsen’s agent. The court
held a show cause hearing on Virginia City’s application for a
preliminary injunction in Dillon, Montana, on September 9, 1999,
and in Virginia City on September 14, 1999. On September 15,
1999, the District Court entered its Findings and Order granting
Virginia City a preliminary injunction precluding further
construction on the structure.
¶11 On April 27, 2000, Virginia City filed a motion for summary
judgment. On May 1, 2000, Olsen and Mason filed a cross-motion for
summary judgment. On October 20, 2000, the District Court entered
its Findings and Order granting summary judgment to Virginia City.
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On October 24, 2000, Olsen and Mason filed a motion to vacate the
court’s October 20, 2000, Order pending the completion of briefing
and the filing of transcripts. Mason additionally filed a motion
that same day requesting oral argument on the parties pending
summary judgment motions. Shortly thereafter, the District Court
stayed its October 20, 2000, Order and deemed oral argument
unnecessary. On November 20, 2000, the District Court entered its
Findings and Order reaffirming its award of summary judgment to
Virginia City.
¶12 Judgment was entered by the court on December 19, 2000,
enjoining further construction and ordering the removal of the
structure. Olsen and Mason appeal.
STANDARD OF REVIEW
¶13 We review discretionary trial court rulings for an abuse of
discretion. See Linn v. City County Health Dept., 1999 MT 235, ¶
6, 296 Mont. 145, ¶ 6, 988 P.2d 302, ¶ 6 (citation omitted). Since
we have previously held that a hearing is not necessary prior to
granting summary judgment in extraordinary circumstances, we will
review a district court’s decision to deny such hearing for an
abuse of discretion. See Linn, ¶ 6.
DISCUSSION
¶14 Did the District Court err in awarding Virginia City summary
judgment without affording Olsen and Mason a hearing?
¶15 Summary judgment is only proper when there are no issues of
material fact revealed in the pleadings, depositions, answers to
interrogatories, admissions on file, and affidavits, and the moving
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party is entitled to judgment as a matter of law. Rule 56(c),
M.R.Civ.P. Under Rule 56(c), M.R.Civ.P., “a hearing is
contemplated from which the district court will consider not so
much legal arguments, but rather whether there exists genuine
issues of material fact.” Cole v. Flathead County (1989), 236
Mont. 412, 418, 771 P.2d 97, 101. Therefore, we have held that in
the ordinary case the parties have a right to a summary judgment
hearing unless the hearing is explicitly waived. Linn, ¶ 8. We
stated in Cole, 236 Mont. at 418, 771 P.2d at 101, that:
In view of the language of Rule 56(c), and having in mind
that the granting of such a motion disposes of the action
on the merits, with prejudice, a district court may not,
by rule or otherwise, preclude a party from requesting
oral argument, nor deny such a request when made by a
party opposing the motion unless the motion for summary
judgment is denied.
¶16 Nevertheless, we have recognized that “[t]here may be an
occasion when under the law and the facts adduced, the movant would
be so clearly entitled as a matter of law to a summary judgment
that a district court might by order dispense with the necessity of
a hearing.” Cole, 236 Mont. at 419, 771 P.2d at 101. Such an
order was not presented to us in this case, as the court failed to
specify the grounds underlying its summary judgment ruling.
¶17 Pursuant to Rule 52(a), M.R.Civ.P.:
[A]ny order of the court granting a motion under Rules 12
or 56 which is appealable to an appellate court shall
specify the grounds therefor with sufficient
particularity as to apprise the parties and the appellate
court of the rationale underlying the ruling and this may
be done in the body of the order or in an attached
opinion. [Emphasis added.]
¶18 In its September 15, 1999, Order the court stated:
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The construction seemed to violate the setback and height
restrictions as well as window requirements.
. . . .
The defense was a mixture of multiple contentions ranging
from an attack on the plat of the town site, estoppel,
selective prosecution, validity of ordinances and
policies, constitutional issues, procedures for
measurements, among others. The Court finds generally
for the Town and against the Defendants on each of the
defenses, at least at this preliminary stage.
¶19 The court adopted its September 15, 1999, findings in its
October 20, 2000, Order. Subsequently, the court stated in its
November 20, 2000, Order that:
If as Defendants now claim there is some “confusion” as
to the various provisions of the zoning ordinance, why
didn’t Defendants apply for a variance as suggested not
only by the town authorities but repeatedly by the Court.
Defendants stonewalling tactics and insistence on
pursuing senseless and expensive litigation is the
anomaly in this case.
¶20 We conclude that this language fails to specify with
sufficient particularity the rationale underlying the court’s
ruling, particularly the defenses raised in Olsen and Mason’s
cross-motion for summary judgment. Therefore, we hold that the
District Court did not comply with Rule 52(a), M.R.Civ.P., in its
November 20, 2000, Order granting Virginia City summary judgment.
¶21 Moreover, we point out that the court acknowledged in its
September 15, 1999, Order that Olsen and Mason were entitled to an
evidentiary hearing. However, in its October 20, 2000, Order and
in its November 20, 2000, Order the court deemed a hearing
unnecessary based on the evidence it adduced from the hearing it
conducted on Virginia City’s motion for a preliminary injunction.
We note that at the hearing held on September 9 and September 14,
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1999, the parties presented extensive testimony, witnesses, and
exhibits without the benefit of full discovery and responsive
pleading to Virginia City’s amended complaint. Since discovery is
seldom completed prior to the time preliminary injunction hearings
are held, we have repeatedly advised district courts that when
granting temporary relief by injunction, it is not the province of
the court to determine matters that may arise during a trial on the
merits. See Knudson v. McDunn (1995), 271 Mont. 61, 65, 894 P.2d
295, 298 (citing Porter v. K & S Partnership (1981), 192 Mont. 175,
183, 627 P.2d 836, 839).
¶22 In Porter, 192 Mont. at 183, 627 P.2d at 840, we stated:
In granting temporary relief by injunction, courts of
equity should in no manner anticipate the ultimate
determination of the questions of right involved.
Rather, the court should decide merely whether a
sufficient case has been made out to warrant the
preservation of the property or rights in status quo
until trial, without expressing a final opinion as to
such rights. An applicant need not make out such a case
as would entitle him to final judgment on the merits.
[Citations omitted].
¶23 Although the court stated in its October 20, 2000, Order that
it considered the entire record, including extracts from
depositions, in addition to the evidence adduced at the hearing
held on September 9 and 14, 1999, it did not reference in either
its October 20, 2000, Order or its November 20, 2000, Order the
affidavits filed by Olsen and Mason, most notably that of Donahue.
Consequently, in light of the court’s noncompliance with Rule
52(a), M.R.Civ.P., we see no reason in this case to depart from the
general rule that a party opposing a summary judgment motion is
entitled to a hearing in order to establish genuine issues of
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material fact pursuant to Rule 56(c), M.R.Civ.P. Therefore, we
hold that the District Court abused its discretion when it granted
Virginia City summary judgment without affording Olsen and Mason a
hearing.
¶24 In response to Justice Trieweiler’s dissent, we point out that
Olsen and Mason allege within the first issue raised in their
opening brief that the District Court erred in denying their motion
for a summary judgment hearing. Specifically, they contend:
The District Court also denied Olsen/Mason’s motion for a
hearing on the motions for summary judgment. Rule 56(c)
clearly contemplates a hearing on such motions. In this
case in particular, we submit that failure to hold such a
hearing is error. Cole v. Flathead Co., 236 Mont. 412,
771 P.2d 97, 46 St. Rep. 469 (1980) [sic].
Accordingly, we conclude Olsen and Mason are entitled to a further
evidentiary hearing prior to entry of a determination of the merits
in this case since the only hearing afforded the parties took place
before discovery was conducted or responsive pleadings were filed.
¶25 Reversed and remanded for further proceedings consistent with
this Opinion.
/S/ JIM REGNIER
We Concur:
/S/ W. WILLIAM LEAPHART
/S/ PATRICIA COTTER
/S/ JAMES C. NELSON
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Justice Terry N. Trieweiler dissenting.
¶26 I dissent from the majority Opinion which, as I understand it,
is based on the District Court's failure to hold a hearing before
granting Virginia City's motion for summary judgment.
¶27 First, I would note as a practical matter that the District
Court held two hearings at which all the arguments that could have
been made at a summary judgment hearing were made. Second, and
more importantly, the District Court's failure to hold a hearing
was not an issue that was even raised on appeal by the Defendants.
Rule 23(2), M.R.App.P., requires that issues being presented for
the Court's consideration be set forth in the statement of issues.
In their statement of issues presented for review, the Defendants'
brief set forth the following:
Issue 1. Did the District Court err by failing to
enter Findings of Fact and Conclusions of Law with
sufficient particularity to apprise the parties and this
Court of the grounds for its grant of an injunction?
Issue 2. Did the District Court err in granting
Summary Judgment for the plaintiff?
Issue 3. Did the District Court err in not entering
Summary Judgment for Olsen and Mason?
¶28 The majority cites language in the last paragraph of the
argument in support of Issue 1 as support for its consideration of
the hearing issue. However, that language, at best an
afterthought, has nothing to do with Issue 1 as it was framed and
Defendants' brief is full of random, unconnected arguments. There
was no way to reasonably respond without limiting the response to
the issues that were identified. Furthermore, the Defendants were
perfectly happy to have this Court enter summary judgment for them
10
in spite of the fact that no hearing was held. Apparently, their
theory was that they were entitled to judgment as a matter of law
without the need for a hearing.
¶29 I would affirm the District Court on all issues raised on
appeal. Rule 52(a), M.R.Civ.P., merely requires that a district
court specify the grounds for summary judgment orders "with
sufficient particularity as to apprise the parties and the
appellate court of the rationale underlying the ruling. . . ."
There is no question in my mind regarding the rationale for the
District Court's summary judgment order. Following a hearing and
the presentation of evidence, the District Court stated in its
September 15, 1999, Order, that the Defendants violated the setback
and height requirements established by city ordinance and the
window requirements on which the Defendants' cite/zoning permit and
development permit were conditioned.
¶30 Furthermore, the District Court noted that it had considered
the Defendants' affirmative defenses and at that time found
generally for the City. That was easy, since the Defendants'
affirmative defenses of waiver, estoppel, latches and failure to
exhaust administrative remedies had no basis in fact.
¶31 While it is true that the merits of a case should not be
decided on the basis of a hearing to determine whether temporary
injunctive relief should be granted, there was nothing wrong with
the District Court incorporating its preliminary findings by
reference after considering further deposition testimony,
affidavits and arguments of the parties. That is all the District
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Court did in its summary judgment order dated October 20, 2000.
Apparently, the Defendants did not disagree that the case was ready
for disposition by summary judgment at that point in time. The
Defendants made their own motion for summary judgment based on the
state of the record.
¶32 In its October 20, 2000, Order the Court stated:
The Court has considered the entire record including
extracts from depositions and the evidence adduced at the
order to show cause hearing held on September 9 and 14,
1999. From the entire record the Court now makes what it
determines to be relevant:
FINDINGS AND CONCLUSIONS
1. The Court hereby adopts by this reference its
Findings and Order of September 15, 1999.
. . . .
3. The evidence already adduced establishes without
question that the Defendants constructed a building in
violation of the permit issued therefor and contemplated
further construction in violation of the issued permit
and the known historic preservation policy. The
violations are obvious and for the most part admitted.
¶33 The District Court's judgment on the merits was correct.
Virginia City is a community of great historical significance to
all of Montana. In order to preserve its historical integrity, it
has adopted Ordinance No. 503 which requires cite/zoning permits
and development permits. Prior to issuance of the permits, an
applicant must assure compliance with all relevant ordinances.
¶34 Virginia City's ordinance establishes a minimum setback
requirement of fifty feet from the center line of the adjoining
street and twenty-five feet from the lot line. The Defendants'
property was thirty-one feet from the center line of the adjoining
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street as plotted and thirty-eight feet from the center line of the
traveled way. It was only six feet from the lot line. Whether the
distance is measured from the street passing by the front of the
house or the side of the house, the Defendants' construction was
clearly in violation of the setback requirements established by the
City's ordinance.
¶35 The City's ordinance also limits the height of new
construction to twenty-five feet from the top of the foundation to
the ridge line of the roof. The Defendant's property was 27.8 feet
high and violated both the ordinance and the permits which were
issued to them.
¶36 As conditions to the permits which were issued, Defendants
were required to build their house in a configuration and size
consistent with a historical design of homes in Virginia City.
They were also required to design and locate windows in an
architecturally acceptable manner. They did not comply with any of
these requirements. There are no questions of fact regarding their
failure to comply.
¶37 Section 27-19-102, MCA, provides in relevant part that a final
injunction may be granted to prevent the breach of an obligation
existing in favor of the applicant where "(1) pecuniary
compensation would not afford adequate relief; . . . ."
¶38 The facts presented by this case are a classic example of a
situation in which compensation would not afford adequate relief.
The historical value of places like Virginia City is priceless.
Once it is compromised, it cannot be restored. Defendants' conduct
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is a classic example of people coming to a place because of its
attractiveness and then destroying the qualities that brought them
there for their own self-indulgence. After reviewing the record in
this case, I agree with the observation of the attorney for
Virginia City when he commented that:
The owners choose to purchase a lot and to build a house
in a Historic Residential District in a town which is a
jewel–a state and national treasure. What they have
constructed to date is a hulking, rectangular box which
seriously violates numerous conditions of its permit and
which looms over the narrow Virginia City valley as an
incredible eyesore. Each of the violations is serious,
and to combine defective violations is nothing short of
egregious.
¶39 The Defendants' construction violates Virginia City ordinances
establishing setback and height requirements. It violates the
permit pursuant to which it is being constructed by its design, its
size, its shape, and fenestration requirements. No amount of
litigation and expense will change these facts. Because of these
facts, the construction jeopardizes the architectural and
historical integrity of a priceless resource to the state of
Montana and should be torn down without further delay or
litigation.
¶40 I would affirm the judgment of the District Court and order
that the Defendants do so.
¶41 For these reasons, I dissent from the majority Opinion.
/S/ TERRY N. TRIEWEILER
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