First Security Bank v. Income Properties, Inc.

No. 83-255
IN THE SUPRE,W COURT OF THE STATE OF MONTANA
1984

FIRST SECURITY BANK OF KALISPELL,
Plaintiff and Respondent,

INCOME PROPERTIES, INC., JOHN J. MING,
INC. TREASURE STATE REALTORS, I N C . ,
JOHN J. AND MARIE MING,
Defendants and Appellants.

APPEAL FRON: District Court of the Eleventh Judicial District,
In and for the County of Flathead,
The Honorable Robert C. Sykes, Judge presiding.

COUNSEL OF RECORD:
For Appellants:
John J. Ming, pro se, Kalispell, Montana

For Respondent:

Hash, Jellison, O'Brien & Bartlett; James C. Bartlett,
Kalispell, Montana

Submitted on Briefs: December 1, 1983
Decided: February 2, 19 84

Filed:
. 6 - 1 2 J
984

E

Clerk
Mr. Justice L.C. Gulbrandson delivered the Opinion of the
Court.

Defendants appeal from the judgment of the District
Court of the Eleventh Judicial District, Flathead County,
granting possession of certain real property to plaintiff
First Security Bank of Kalispell, and awarding damages to
the plaintiff on account of wrongful possession by
defendants. For the reasons stated below, we dismiss the
appeal as moot.
In December of 1975, a trust indenture was executed by
Income Properties, Inc. as grantor, First Montana Title
Company, as trustee, and First National Bank of Kalispell
(now Norwest Bank), as beneficiary. The property consisted
of two lots adjacent to the main street of Kalispell,
Montana. A two bedroom home sits on one lot, and a
converted office building is on the other lot. John and
Marie Ming apparantly operated a real estate business in the
converted building and maintained residence in the home.
John Ming is president of Income Properties, Treasure State
Realters, Inc., and John J. Ming Inc.
Income Properties defaulted on the terms of the
indenture in 1981 and failed to cure. The property was
subsequently noticed for a public trustee's sale on December
31, 1981. The property was purchased by the plaintiff,
First Security Bank (First Bank), for the sum of $60,500. A
trustee's deed was then executed in plaintiff's name.
First Bank gave written notice to Ming and his
corporations to vacate the two lots. Ming refused to move
and retained possession of both the house and the office.
On June 16, 1982, the bank filed a complaint in justice
court alleging unlawful de tainer and seeking possession and
damages. Ming, appearing pro se, filed an answer
questioning the propriety of First Bank's title to the
property. At this point, the justice court was deprived of
jurisdiction, and the cause was certified to district court.
The plaintiff renewed the terms of its old complaint.
An amended answer, written on stationary belonging to the
law firm of Datsopolous, McDonald and Lind but signed only
by John Ming, denied the Bank's allegations of title and
damages. The answer went on to assert that the trustee's
sale had been defective, and that First Bank had always been
aware of the defects. Ming also pressed a counterclaim
against the Bank and a third party claim against First
Montana Title Company, alleging a conspiracy to defraud Ming
and his wife of the property in dispute.
The Bank moved for summary judgment on October 13,
1982, and filed appropriate affidavits and a memorandum in
support of the motion. The Bank's motion and memorandum
emphasized that if there were any defects in the trustee's
sale, as alleged by Ming, then his complaint lay with the
trustee under the trust indenture, First Montana Title
Company, or the beneficiary, Norwest Bank, and not against
First Bank, which alleged status as a bona fide purchaser
for value. A hearing on the motion was scheduled for
October 26, but the matter was continued at request of
Ming ' s counsel, Chris Swar tley of Datsopolous, McDonald and
Lind.
On November 23, Swartley moved to withdraw as
defendants' counsel, alleging that the attorney-client
relationship had been "strained" from the outset and that
Ming had been "totally uncooperative in resolving [the case]
or in following [counsel's] recommended course of action."
Following issuance of an order to show cause and a hearing,
the trial judge granted the withdrawal petition. Ming was
ordered to prepare a brief and appropriate affidavits in
response to the summary judgment motion. He then retained
attorney Lloyd Ingraham of Polson as counsel. EJei ther
Ingraham nor Ming prepared pleadings or supporting documents
as ordered by the court. Instead, Ingraham informally
requested another continuance. The request was denied.
Without explanation or justification, no responsive
pleadings, aff idavits, or other documents were prepared or
filed after the trial court denied the second continuance.
On December 22, 1982, the court granted summary judgment to
the Bank. In its findings of fact and conclusions of law,
the court noted defendants' failure to file a responsive
pleading, but emphasized that if defendants had any
legitimate claims at stake, they were against the title
company or Norwest Bank, and not First Bank, which the court
found was a bona fide purchaser for value, taking the
property free of any defects. The court set a hearing for
January 21, 1983, to hear evidence on damages stemming from
defendants' wrongful possession of the properties. A writ
of possession was prepared in the event the Mings refused to
vacate the properties.
On December 27th, Ming pro se filed a notice of appeal
to this Court and posted a $500 appeal bond. The appeal was
stricken sua sponte by this Court January 19, 1983, because
the judgment was not final pursuant to Rule 1,
M.R.App.Civ.P., and lacked certification under Rule 54(b),
M.R.Civ.P. The cause was returned to district court,
whereupon the damages hearing proceeded as originally
ordered. Ming again appeared on his own behalf, alleging
nominal damages, if any, from his possession of the lots and
buildings thereon. The trial court disagreed, and its
judgment of February 25, 1983, found defendants liable for
$38,437.50 damages and $1,200 in attorney's fees. (Actual
damages for wrongful possession amounted to only $12,812.50,
but because the court found that such possession had
continued in bad faith for many months, the actual damages
were trebled as provided by law.) Following notice of entry
of judgment, Ming, acting pro se, submitted a pleading
captioned "Motions to Reconsider," criticizing alleged

defects in the trustee's sale and the subsequent award of
damages. Copies of several documents relating to the trust
indenture were attached. However, no action was taken on
these "motions," and Ming timely filed a notice of appeal
April 1, 1983. None of the parties make any reference in
their briefs to Ming's "motions."

In the interim following entry of judgment, Ming
apparantly refused to move himself or his business and
personal effects from the lots. A writ of possession was
issued, and all personal effects were removed. The Mings
left their residence and place of business. Subsequent
writs of execution have been filed on Ming's personal
property and financial accounts to satisfy damages awarded
under the court's judgment. At no time before or after
notice of appeal was filed did Ming or his attorney,
Ingraham, move to stay execution of the judgment or file an
appropriate supersedeas bond.
 W n o t e t h a t a l l a p p e l l a t e b r i e f s f i l e d on d e f e n d a n t s '
e
b e h a l f h a v e b e e n p r e p a r e d and s u b m i t t e d by Mr. I n g r a h a m . We

also note that, subsequent to submission of this case,

several motions and personal letters have been filed by
First Bank and the defendants concerning alleged

jurisdictional d e f e c t s i n the appeal. W e denied, without
prejudice, F i r s t Bank's motion t o d i s m i s s t h i s appeal for

mootness. S i m i l a r l y , we d e n i e d m o t i o n s t o d i s m i s s f o r l a c k
of prosecution, o u t of consideration f o r defendants' e f f o r t s
to at least put before this Court the issues they deem
critical. Ming c o n t a c t e d t h e t r i a l c o u r t f o r a d v i c e a b o u t a

stay of execution of judgment and the filing of a
s u p e r s e d e a s bond, b u t he a p p a r a n t l y h a s n o t pursued e i t h e r

course of action.
On t h i s a p p e a l , d e f e n d a n t s r a i s e two i s s u e s r e l a t i v e
t o the District Court's summary judgment: (1) Whether the
t r u s t e e ' s s a l e was d e f e c t i v e , a n d ( 2 ) w h e t h e r F i r s t Bank h a d

notice of the alleged defects. No issue is raised
c o n c e r n i n g damages a w a r d e d t o t h e Bank. A l t h o u g h t h e Bank

has responded t o a l l e g a t i o n s concerning t h e t r u s t e e ' s s a l e ,
i t r e n e w s i t s p r e v i o u s m o t i o n s t o d i s m i s s f o r m o o t n e s s and

other jurisdictional irregularities. Upon examination of

the record and consideration of issues presented by the

parties, we now grant the Bank's motion to dismiss the

a p p e a l a s moot, b e c a u s e t h i s C o u r t i s n o t a b l e t o r e n d e r the
r e l i e f defendants seek.
R u l e 7 ( a ) , M.R.App.Civ.P. provides, in pertinent part:
"Upon e n t r y of a judgment o r o r d e r a
p a r t y may a p p l y t o t h e d i s t r i c t c o u r t on
n o t i c e o r ex p a r t e f o r a s t a y o f
e x e c u t i o n o f t h e judgment o r o r d e r ...
Upon s e r v i c e o f n o t i c e o f a p p e a l , i f t h e
c o u r t h a s made no s u c h o r d e r ... h e may
 present to the district court and secure
its approval of a supersedeas bond which
shall have such surety or sureties as are
required . . .The bond shall be
conditioned for the satisfaction of the
judgment or order in full together with
costs, interest, and damages for delay, .
.. When the judgment or order determines
the disposition o f property in
----------____--------------.--
controversv as in real actions, re~levin.
and actions to foreclose mortgages ...
the amount of the supersedeas bond shall
be fixed at such sum onlv as will secure
......................... f o r the use and
the amount recovered
detention of the property, the costs of
the action, costs o n appeal, interest,
and damages for delay " . . .
(Emphasis
added. )
By paying damages or surrendering property due under a
judgment, a party effectively accedes to the correctness of
that judgment, and it passes beyond this Court's power to
review. Dahl v. Petroleum Geophysical Co. (Mont. 1981), 632
P.2d 1136, 38 St.Rep. 1474; Montana Nat'l Bank of Roundup v.
Dept. of Revenue (1975), 167 Mont. 429, 539 P.2d 722;
Gallatin Trust & Sav. Bank v. Henke (1969), 154 Mont. 170,

Here, defendants have surrendered the property in
question under court order and the terms of a writ of
possession. No stay of execution of judgment was sought and

no supersedeas bond was requested or approved. Defendents
have acquiesced in the terms of the summary judgment; this

Court is in no position to grant relief. As we emphasized
earlier, the issue of damages is not before this Court.
Defendants' only responses to the mootness issue are that no
statute or case law has been cited in support of the Bank's
motion to dismiss, and that the Bank's contentions with
respect to stay of judgment and a supersedeas bond are
absurd. The first response is incorrect; the second is
without merit. Furthermore, defendants' dogged persistence
in attacking the District Court's summary judgment, after
failing, without explanation or justification, to file
responsive pleadings and supporting affidavits in opposition
to First Bank's motion for summary judgment, is more than a
little unusual. Nevertheless, because defendants may be
appealing in good faith reliance on defense counsel's theory
of the case, we decline the Bank's suggestion that we award
damages under Rule 32, l4.R.App.Civ.P. for an unreasonable
appeal.

We concur: /'