March 7 2012
DA 11-0274
IN THE SUPREME COURT OF THE STATE OF MONTANA
2012 MT 54N
MAX KOEMANS,
Plaintiff, Appellee, and Cross-Appellant.
v.
JERRY DURGERIAN, ANN DURGERIAN,
JOHN DOES 1-5, and ABC CORP.,
Defendants and Appellants.
v.
APPEAL FROM: District Court of the Twentieth Judicial District,
In and For the County of Lake, Cause No. DV 09-225
Honorable Deborah Kim Christopher, Presiding Judge
COUNSEL OF RECORD:
For Appellants:
Court E. Ball; Towe, Ball, Enright, Mackey & Sommerfeld, PLLP, Billings,
Montana
For Appellee:
Christopher W. Froines, Geiszler & Froines, P.C., Missoula, Montana
Submitted on Briefs: February 15, 2012
Decided: March 7, 2012
Filed:
__________________________________________
Clerk
Justice Brian Morris delivered the Opinion of the Court.
¶1 Pursuant to Section I, Paragraph 3(d), Montana Supreme Court Internal Operating
Rules, this case is decided by memorandum opinion and shall not be cited and does not serve
as precedent. Its case title, cause number, and disposition shall be included in this Court’s
quarterly list of noncitable cases published in the Pacific Reporter and Montana Reports.
¶2 Appellants Jerry and Ann Durgerian (Durgerians) appeal from the District Court’s
order that granted summary judgment to Appellee/Cross-Appellant Max Koemans
(Koemans) relating to Durgerians’ efforts to collect on an installment contract and from the
District Court’s findings of facts and conclusions of law and order that quieted title to
Koemans in certain real property located in Arlee, Montana. Koemans cross-appeals the
District Court’s order denying him any share of income generated from a California
partnership between Koemans and Durgerians. We affirm.
¶3 Koemans apparently met Durgerians in California when he was a young man.
Koemans performed a variety of work at the Durgerians’ businesses over the years. Both
parties seemed to benefit from this arrangement.
¶4 Koemans and Durgerians entered into a partnership arrangement in 1994. The
partnership, D-K Enterprises, purchased commercial property in El Monte, California, for a
price of $1.5 million. Durgerians apparently contributed $175,000 to the partnership. This
amount corresponds with the amount that Koemans attested to owing to Durgerians in a
document that he executed on May 12, 1995. Koemans did not contribute any money to the
partnership, but the partnership arrangement nevertheless provided that Koemans and
2
Durgerians each would possess one vote in the “management and decision making” of the
partnership.
¶5 The commercial property in El Monte proved profitable to Durgerians. They recorded
in Los Angeles County, California, a grant deed on March 26, 1999, that conveyed title of
the El Monte property from D-K Enterprises to Durgerians. Durgerians claim to have
“dissociated” Koemans from the partnership based upon his failure to make any payments to
the partnership. Durgerians sold the El Monte property for $2.6 million which resulted in a
net profit of approximately $1.1 million. Durgerians did not share any of the profits from the
sale of the El Monte property with Koemans.
¶6 Durgerians further claimed to have loaned Koemans money over the years. In
particular, they point to a 1994 promissory note in the amount of $200,000 and a 1994
installment contract in the amount of $251,000. Koemans made a single $10,000 payment in
1994 on the promissory note. He had made no further payments on either debt and he
alleges that Durgerians made no request for payment.
¶7 Koemans eventually purchased four parcels of real property in Arlee, Montana. One
of these parcels contains a house in which Koemans lives. Durgerians alleged that Koemans
executed quit claim deeds on August 21, 1996, for all four Arlee parcels in favor of
Durgerians to serve as collateral for the debts incurred through Koemans’s various loans.
Koemans admitted to having executed the quit claim deeds, but claims that the parties agreed
that Durgerians would not record the deeds. Durgerians soon recorded the deeds, however,
in Lake County, Montana, on September 30, 1996. They eventually sold three of the four
3
Arlee parcels for a profit of approximately $186,000. Koemans claims that Durgerians never
notified him of the sales and never shared any of the proceeds with him.
¶8 Koemans filed an action in Lake County to quiet title in his name to the remaining
Arlee parcel. Durgerians filed a counter-claim to quiet title in their name and added claims
relating to the $200,000 promissory note and the $251,000 installment note. Koemans raised
the statute of limitations as an affirmative defense to Durgerians’ claim on the $251,000
installment note. The District Court granted Koemans’s motion for partial summary
judgment with respect to the $251,000 installment note based upon the expiration of the
eight-year statute of limitations period contained in § 27-2-202, MCA, for actions pursuant
to a contract.
¶9 The case proceeded to a bench trial on the remaining claims. The District Court
entered findings of facts and conclusions of law and an order in favor of Koemans. With
respect to the $200,000 promissory note, the court noted that Durgerians improperly had sold
the three Arlee parcels for a profit of $186,000 without notifying Koemans of the sale or
providing any of the proceeds to Koemans. The court offset this amount from the $200,000
liability of the note. The court also offset the single $10,000 payment that Koemans had
made in June 1994 to satisfy the debt. The court refused, however, to allow Durgerians to
recover the remaining $4,000 as a sanction for their actions in selling improperly the three
Arlee parcels. The District Court quieted title in Koemans’s name to the remaining Arlee
parcel.
4
¶10 With respect to D-K Enterprises, the court determined that Koemans had never
contributed any money to the partnership and thus, was not entitled to any of the proceeds
from the sale of the El Monte property. The court awarded Koemans $998 in costs of the
litigation. Durgerians appeal and Koemans cross-appeals.
¶11 Durgerians argue on appeal the court improperly granted summary judgment on the
installment note as they filed a claim on the note before the expiration of the equitable statute
of limitations in light of the optional acceleration clause of the note. Durgerians contend that
they had not exercised the right to accelerate payments before the 2006 maturity date and
thus the time period for filing the suit had not begun to run until 2006. Durgerians also
alleged that the District Court improperly denied any recovery on the remaining $4,000 on
the promissory note and that the District Court improperly failed to take into account interest
accrued on the note. Durgerians further argue the court improperly denied their claim of an
equitable mortgage on the Arlee property. Koemans argues on his cross-appeal that the court
improperly denied him 50% of the sale proceeds from the El Monte commercial property.
¶12 We review de novo a district court’s grant of summary judgment by using the same
standard applied by the district court as set forth in M. R. Civ. P. 56. Wing v. State, 2007
MT 72, ¶ 9, 336 Mont. 423, 155 P.3d 1224. We review the record to determine whether
substantial evidence supports a district court’s findings of fact. JTL Group, Inc. v. New
Outlook, LLP, 2010 MT 1, ¶ 30, 355 Mont. 1, 223 P.3d 912. We review for correctness a
district court’s conclusions of law. JTL Group, Inc., ¶ 9. We have determined to decide this
case pursuant to Section I, Paragraph 3(d), of our 1996 Internal Operating Rules, as amended
5
in 2006, that provide for memorandum opinions. It is manifest on the face of the briefs and
the record before us that substantial evidence in the record supports the District Court’s
findings and that the District Court correctly applied the law to these findings.
¶13 Affirmed.
/S/ BRIAN MORRIS
We Concur:
/S/ MIKE McGRATH
/S/ PATRICIA COTTER
/S/ MICHAEL E WHEAT
/S/ JIM RICE
6