No. 80-355
I N THE SUPREME COURT O F THE S T A T E O F MONTANA
1981
JOHN C A R R I G E R ,
P l a i n t i f f and R e s p o n d e n t ,
-vs-
GLEN BALLENGER AND B I L L CLARK,
D e f e n d a n t s and A p p e l l a n t s .
Appeal from: D i s t r i c t C o u r t of t h e Second J u d i c i a l D i s t r i c t ,
I n and f o r t h e C o u n t y of S i l v e r B o w , T h e H o n o r a b l e
A r n o l d O l s e n , Judge p r e s i d i n g .
C o u n s e l of R e c o r d :
For A p p e l l a n t :
D a n i e l R. Sweeney, Butte, Montana
For R e s p o n d e n t :
Burgess, Joyce & Whelan, B u t t e , M o n t a n a
S u b m i t t e d on B r i e f s : M a r c h 11, 1 9 8 1
~ecidedJlJN 2 1981
Mr. C h i e f J u s t i c e F r a n k I . H a s w e l l d e l i v e r e d t h e O p i n i o n of t h e
Court.
On J a n u a r y 24, 1 9 7 9 , J o h n C a r r i g e r f i l e d a c o m p l a i n t i n
t h e Second J u d i c i a l D i s t r i c t C o u r t a l l e g i n g breach of c o n t r a c t
a n d damages d u e t o t h e a l l e g e d f a i l u r e o f a p p e l l a n t s B a l l e n g e r
a n d C l a r k t o c o m p l e t e t h e c o n s t r u c t i o n work a c c o r d i n g to t h e
c o n t r a c t terms. The a p p e l l a n t s c o u n t e r c l a i m e d f o r b r e a c h o f
c o n t r a c t and damages as a r e s u l t o f a l l e g e d c o n d u c t o f r e s p o n d e n t
p r e v e n t i n g t h e i r performance. T r i a l was h e l d on A p r i l 3 , 1 9 8 0 ,
before the c o u r t without a jury. The t r i a l c o u r t ' s f i n d i n g s and
c o n c l u s i o n s were e n t e r e d o n A p r i l 30, 1 9 8 0 . J u d g m e n t was e n t e r e d
i n f a v o r o f r e s p o n d e n t C a r r i g e r i n t h e amount o f $ 1 , 2 0 0 , p l u s
interest. From t h e d e n i a l o f t h e i r m o t i o n t o amend t h e f i n d i n g s
a n d c o n c l u s i o n s or i n t h e a l t e r n a t i v e f o r a r e h e a r i n g , B a l l e n g e r
and C l a r k a p p e a l .
J o h n C a r r i g e r owns a home i n B u t t e , Montana. P r i o r to
A u g u s t , 1 9 7 8 , t h e r e was n o b a s e m e n t i n t h e home and t h e h e a t i n g
consisted of w a l l heaters. Carriger thought the heating system
was d a n g e r o u s and s h o u l d be r e p l a c e d , b u t i n o r d e r t o d o so it
was n e c e s s a r y t o h a v e a b a s e m e n t c o n s t r u c t e d .
The a p p e l l a n t s , u n d e r t h e name o f B & B L a n d s c a p i n g , were
e n g a g e d i n t h e b u s i n e s s o f i n s t a l l i n g l a w n s and d o i n g e x c a v a t i o n
a n d c o n s t r u c t i o n work. C r e i g h t o n W a l s h , J r . , who is now m a r r i e d
t o C a r r i g e r ' s d a u g h t e r , was employed as a p a r t t i m e l a b o r e r b y t h e
appellants.
C a r r i g e r , t h r o u g h Walsh, o b t a i n e d a w r i t t e n b i d from t h e
a p p e l l a n t s o n t h e c o s t o f e x c a v a t i n g and i n s t a l l i n g a f i n i s h e d
b a s e m e n t u n d e r h i s h o u s e w i t h a c e m e n t f l o o r and p u m i c e b l o c k
walls. The w r i t t e n b i d w a s b r o k e n down i n t o t h r e e c o m p o n e n t s as
follows :
Excavation $1,200
Pumice b l o c k w a l l s $3,800
Floor $2,000
The t o t a l c o s t was $ 7 , 0 0 0 . On J u l y 20, C a r r i g e r t o o k t h e e s t i -
mate t o a b a n k and o b t a i n e d a $ 8 , 5 2 7 l o a n f o r t h e c o n s t r u c t i o n
and t h e h e a t i n g system.
T h e r e w a s c o n f l i c t i n g t e s t i m o n y w i t h r e g a r d to t h e f i n a l
a g r e e m e n t o f t h e p a r t i e s and t h e s e q u e n c e o f e v e n t s . Carriger
t e s t i f i e d t h a t h e t o l d Walsh t o t e l l a p p e l l a n t s to s t a r t work.
C a r r i g e r and Walsh b o t h t e s t i f i e d t h a t work b e g a n o n A u g u s t 1.
C a r r i g e r t e s t i f i e d t h a t o n A u g u s t 4 t h e a p p e l l a n t s came to him
and r e q u e s t e d a downpayment o f e i t h e r o n e - t h i r d of t h e e x c a v a t i o n
work or o n e - t h i r d of t h e e n t i r e c o n t r a c t . C a r r i g e r s t a t e d he
a s k e d them i f t h e y c o u l d g e t t h e work d o n e by A u g u s t 3 1 and when
t h e y b o t h a g r e e d t o d o so he g a v e them a c h e c k f o r $ 2 , 4 0 0 . Walsh
t e s t i f i e d he was p r e s e n t o n A u g u s t 4 and w i t n e s s e d t h e a g r e e m e n t
on the completion date. B a l l e n g e r and C l a r k d e n i e d t h a t t h e y
a g r e e d t o c o m p l e t e t h e work b y A u g u s t 3 1 b u t s a i d t h e y a g r e e d to
d o it b e f o r e w i n t e r . C l a r k t e s t i f i e d t h a t work had n o t s t a r t e d
b e f o r e t h e y r e c e i v e d t h e c h e c k , b u t t h a t t h e y b e g a n o n e o r two
d a y s a f t e r A u g u s t 4.
The t r i a l c o u r t found t h a t t h e r e s p o n d e n t a c c e p t e d t h e b i d
o n A u g u s t 4, 1 9 7 8 o n t h e c o n d i t i o n t h a t t h e work was t o be
c o m p l e t e d by A u g u s t 31, 1 9 7 8 .
Due t o d e l a y s t h e e x c a v a t i o n work was n o t c o m p l e t e d u n t i l
A u g u s t 31, and t h e work on t h e f l o o r and w a l l s had n o t y e t b e g u n .
Upon C a r r i g e r l s i n q u i r y , t h e a p p e l l a n t s a d v i s e d him t h a t t h e y
c o u l d n o t d o t h e r e m a i n i n g work t h e m s e l v e s . They s e n t York, a
m a s o n r y and c o n c r e t e c o n t r a c t o r , t o t h e p r e m i s e s . Carriger was
most a n x i o u s t o h a v e t h e j o b c o m p l e t e d b e c a u s e of t h e r i s k of
f r e e z i n g water p i p e s . A p p a r e n t l y York would n o t g i v e C a r r i g e r
p r i o r i t y u n l e s s he was h i r e d d i r e c t l y i n s t e a d o f o n a s u b c o n t r a c t
basis. A c c o r d i n g t o C a r r i g e r , B a l l e n g e r a g r e e d to t h i s a r r a n g e -
m e n t and a g r e e d t o r e f u n d $ 1 , 2 0 0 o f t h e downpayment. Ballenger
t e s t i f i e d t h a t York was t o be a s u b c o n t r a c t o r , t h a t he n e v e r g a v e
p e r m i s s i o n t o C a r r i g e r t o h i r e York d i r e c t l y , and t h a t h e had n o t
a g r e e d to r e t u r n $1,200. York c o m p l e t e d t h e work o n S e p t e m b e r
22, 1 9 7 8 , w i t h C a r r i g e r and Walsh d o i n g t h e hod c a r r y i n g and
b a c k f i l l i n g work. A t t h a t t i m e Walsh was no l o n g e r employed by
B & B.
C a r r i g e r demanded t h e r e t u r n o f $ 1 , 2 0 0 f r o m t h e a p p e l -
l a n t s , b u t a p p e l l a n t s refused t o r e t u r n it. The matter was
h e a r d on A p r i l 3 , 1 9 8 0 , and t h e t r i a l c o u r t e n t e r e d i t s f i n d i n g s
and c o n c l u s i o n s o n A p r i l 30, 1 9 8 0 . The c o u r t found t h a t C a r r i g e r
a c c e p t e d a p p e l l a n t s ' b i d on t h e c o n d i t i o n t h a t t h e y f i n i s h t h e
e n t i r e j o b o n A u g u s t 31, 1 9 7 8 , and t h a t t h e a p p e l l a n t s b r e a c h e d
t h e c o n t r a c t by f a i l i n g to c o m p l e t e t h e work by t h a t d a t e or a t
all. The t r i a l c o u r t awarded damages t o r e s p o n d e n t i n t h e amount
o f $1,200, p l u s i n t e r e s t a t t h e l e g a l r a t e from A u g u s t 3 1 , 1 9 7 8 ,
and costs.
A p p e l l a n t s raise t h e following i s s u e s :
( 1 ) Did t h e w r i t t e n b i d c o n s t i t u t e a w r i t t e n c d n t r a c t ?
( 2 ) Did t h e p a r o l e v i d e n c e r u l e b a r a d m i s s i o n o f t e s t i m o n y
r e g a r d i n g a n o r a l a g r e e m e n t as to t h e c o m p l e t i o n d a t e ?
( 3 ) Did t h e t r i a l c o u r t e r r i n f a i l i n g t o f i n d t h a t t h e
r e s p o n d e n t p a r t i a l l y r e s c i n d e d t h e c o n t r a c t and t h a t a p p e l l a n t s
were e n t i t l e d to t h e r e a s o n a b l e v a l u e o f t h e i r work i n t h e amount
o f $2,400?
( 4 ) Did t h e t r i a l c o u r t e r r i n f i n d i n g r e s p o n d e n t s u f f e r e d
d a m a g e s i n t h e amount o f $ 1 , 2 0 0 ?
( 5 ) Did t h e t r i a l c o u r t e r r i n a w a r d i n g i n t e r e s t from t h e
d a t e o f b r e a c h r a t h e r t h a n from t h e d a t e o f j u d g m e n t ?
A p p e l l a n t s f i r s t a r g u m e n t is b a s e d upon t h e p r e m i s e t h a t
t h e i r w r i t t e n bid c o n s t i t u t e d a c o n t r a c t . From t h a t p r e m i s e ,
a p p e l l a n t s a r g u e t h a t t h e p a r o l e v i d e n c e r u l e b a r s t e s t i m o n y con-
c e r n i n g a c o m p l e t i o n d a t e n o t c o n t a i n e d i n t h e w r i t i n g , and t h a t
t i m e is n o t o f t h e e s s e n c e u n l e s s e x p r e s s l y p r o v i d e d i n t h e
writing.
A p p e l l a n t s ' b a s i c p r e m i s e is n o t c o n s i s t e n t w i t h c o n t r a c t
law. T h e i r r e l i a n c e on H i g b y v . Hooper ( 1 9 5 0 ) , 1 2 4 Mont. 3 3 1 ,
2 2 1 P.2d 1 0 4 3 , is m i s p l a c e d . I n t h a t case t h e c o n s t r u c t i o n
c o n t r a c t o r was s e e k i n g t o r e c o v e r h i s c o s t s i n e x c e s s of t h e
c o n t r a c t p r i c e of $8,300. The c o n t r a c t o r had w r i t t e n a l e t t e r
c e r t i f y i n g t o t h e U . S. Government t h a t t h e cost would n o t
exceed $8,300, f o r t h e p u r p o s e o f f a c i l i t a t i n g t h e b u y e r ' s V.A.
loan. The l e t t e r was h e l d to be t h e c o n t r a c t o r ' s s t a t e m e n t t h a t
h e had c o n t r a c t e d w i t h t h e b u y e r and h e was e s t o p p e d to d e n y i t .
A w r i t t e n b i d h a s c o n s i s t e n t l y been c o n s t r u e d as n o t h i n g
more t h a n a n o f f e r t o p e r f o r m l a b o r or s u p p l y m a t e r i a l s , and t h e
o f f e r d o e s n o t r i p e n i n t o a c o n t r a c t u n t i l a c c e p t e d by t h e
offeree. G u l f O i l C o r p . v . C l a r k County ( 1 9 7 8 ) , 94 Nev. 116,
5 7 5 P.2d 1332; Clover Park School District No. 400 v .
C o n s o l i d a t e d D a i r y P r o d u c t s Co. ( 1 9 7 6 ) , 1 5 Wash.App. 429, 5 5 0
P. 2d 47; S a v o c a Masonry Co ., I n c . v . Homes & Son Cons tr . C o .,
Inc. ( 1 9 7 5 ) , 1 1 2 A r i z . 3 9 2 , 5 4 2 P.2d 8 1 7 ; 0. C. Kinney, Inc. v.
P a u l Hardeman, I n c . ( 1 9 6 3 ) , 1 5 1 Colo. 571, 3 7 9 P.2d 628. The
t r i a l c o u r t f o u n d t h a t C a r r i g e r a c c e p t e d t h e b i d o n A u g u s t 4,
1 9 7 8 , upon t h e c o n d i t i o n t h a t t h e work be c o m p l e t e d by A u g u s t 3 1 ,
1978. A c c o r d i n g t o Montana l a w , a p u r p o r t e d a c c e p t a n c e which
v a r i e s o r a d d s t o t h e terms o f t h e o f f e r is n o t a n a c c e p t a n c e b u t
a counteroffer . S e c t i o n 28-2-504, MCA. Upon a c c e p t a n c e by
t h e a p p e l l a n t s o f C a r r i g e r ' s c o u n t e r o f f e r , t h e c o n t r a c t would
have ripened.
The t r i a l c o u r t found t h a t t h e p a r t i e s had o r a l l y a g r e e d
t o t h e c o m p l e t i o n d a t e o f A u g u s t 31, 1 9 7 8 , w h i c h a m o u n t s to a
f i n d i n g t h a t t h e c o u n t e r o f f e r was o r a l l y a c c e p t e d by a p p e l l a n t s .
Appellants dispute t h i s finding, asserting t h a t Carriger did not
even mention a completion d a t e o t h e r than " b e f o r e w i n t e r , " but
t h e t r i a l c o u r t found o t h e r w i s e . T h i s Court w i l l not set a s i d e
f i n d i n g s o f f a c t u n l e s s c l e a r l y e r r o n e o u s and w i l l g i v e d u e r e g a r d
t o t h e o p p o r t u n i t y o f t h e t r i a l j u d g e to d e t e r m i n e t h e c r e d i b i -
l i t y of t h e w i t n e s s e s . R u l e 5 2 ( a ) , M.R.Civ.P.
The c o n t r a c t which r e s u l t e d from t h e w r i t t e n b i d ( t h e
o f f e r ) , t h e c o u n t e r o f f e r and t h e a c c e p t a n c e was p a r t l y w r i t t e n
and p a r t l y o r a l . S i n c e t h e r e was n o t a f i n a l , c o m p l e t e w r i t t e n
d o c u m e n t i n t e n d e d by t h e p a r t i e s to c o n t a i n a l l of t h e terms of
t h e c o n t r a c t , t h e par01 evidence r u l e does not apply. Section
28-2-904, MCA.
S e c t i o n 28-3-602, MCA, p r o v i d i n g t h a t time is n o t of t h e
e s s e n c e i n a c o n t r a c t u n l e s s e x p r e s s l y made so by i t s terms, d o e s
n o t p e r t a i n s o l e l y to w r i t t e n c o n t r a c t s . P a r t i e s t o an o r a l
c o n t r a c t may a l s o p r o v i d e t h a t t i m e is of t h e e s s e n c e . By
a g r e e i n g t o t h e c o m p l e t i o n d a t e w i t h t h e knowledge t h a t C a r r i g e r
deemed t h e d a t e e s s e n t i a l due t o t h e a p p r o a c h i n g c o l d w e a t h e r ,
t h e a p p e l l a n t s a g r e e d t h a t t i m e was o f t h e e s s e n c e . Time being
o f t h e e s s e n c e , a p p e l l a n t s were t h u s i n s u b s t a n t i a l b r e a c h a s o f
A u g u s t 31, 1 9 7 8 , when t h e e n t i r e c o n t r a c t had n o t b e e n p e r f o r m e d .
A p p e l l a n t s ' s e c o n d a r g u m e n t is t h a t C a r r i g e r r e s c i n d e d t h e
c o n t r a c t when he h i r e d York on a d i r e c t b a s i s t o c o m p l e t e t h e
job, t h u s p r e v e n t i n g p e r f o r m a n c e by a p p e l l a n t s who had i n t e n d e d
t o u s e York a s a s u b c o n t r a c t o r . A p p e l l a n t s a r g u e t h a t by v i r t u e
o f t h i s r e s c i s s i o n t h e y are e n t i t l e d t o t h e r e a s o n a b l e v a l u e of
t h e e x c a v a t i o n work i n t h e amount of $ 2 , 4 0 0 . But w h e r e , a s h e r e ,
t h e t r i a l c o u r t b a s e d i t s judgment on a p r i o r b r e a c h of c o n t r a c t
b y a p p e l l a n t s , t h i s a r g u m e n t l a c k s merit.
The f i n a l t w o i s s u e s c o n c e r n t h e m e a s u r e of damages and
amount o f i n t e r e s t due t h e r e s p o n d e n t a s a r e s u l t of t h e
a p p e l l a n t s ' breach. F o r b r e a c h of c o n t r a c t , t h e m e a s u r e of dama-
g e s is s t a t e d g e n e r a l l y a s t h e amount which w i l l c o m p e n s a t e t h e
aggrieved p a r t y f o r a l l t h e d e t r i m e n t proximately caused thereby.
S e c t i o n 27-1-311, MCA. I n a c o n s t r u c t i o n c o n t r a c t where t h e
c o n t r a c t o r a b a n d o n s t h e p r o j e c t or o t h e r w i s e f a i l s t o c o m p l e t e
i t , t h e n o r m a l m e a s u r e o f damages is t h e r e a s o n a b l e c o s t of
c o m p l e t i o n by a n o t h e r p l u s a n y damages s u f f e r e d by t h e d e l a y .
K i r b y v. Kenyon-Noble Lumber Co. ( 1 9 7 6 ) , 1 7 1 Mont. 329, 5 5 8 P.2d
452. I n t h i s case, York c o m p l e t e d t h e c o n t r a c t a t e s s e n t i a l l y
t h e same p r i c e q u o t e d by t h e a p p e l l a n t s , e x c e p t t h a t C a r r i g e r and
h i s son-in-law c o n t r i b u t e d t h e i r own l a b o r i n o r d e r t o g e t t h e
j o b done f a s t e r . The t r i a l c o u r t f o u n d C a r r i g e r s u f f e r e d dama-
g e s i n t h e amount o f $ 1 , 2 0 0 , which w e f i n d is a d e q u a t e compen-
s a t i o n f o r t h e d e t r i m e n t c a u s e d by t h e b r e a c h .
The t r i a l c o u r t awarded i n t e r e s t from t h e d a t e o f t h e
b r e a c h o f c o n t r a c t , A u g u s t 31, 1978. Appellants argue t h a t
i n t e r e s t commences o n t h e d a t e o f judgment p u r s u a n t t o s e c t i o n
25-9-204, MCA.
The c o u r t e r r e d i n a p p l y i n g s e c t i o n 27-1-211, MCA, to t h i s
case. That s t a t u t e provides :
" E v e r y p e r s o n who is e n t i t l e d t o r e c o v e r damages cer-
t a i n or c a p a b l e o f b e i n g made c e r t a i n by c a l c u l a t i o n
a n d t h e r i g h t t o r e c o v e r which is v e s t e d i n him upon
a p a r t i c u l a r d a y is e n t i t l e d a l s o to r e c o v e r i n t e r e s t
t h e r e o n f r o m t h a t d a y e x c e p t d u r i n g s u c h time as t h e
d e b t o r is p r e v e n t e d by l a w o r by t h e a c t of t h e c r e d -
i t o r from paying t h e d e b t ."
Two o f t h e c r i t e r i a i n t h e a b o v e - q u o t e d statute are met, i.e.
C a r r i g e r was e n t i t l e d to r e c o v e r damages and t h e r i g h t t o r e c o v e r
damages v e s t e d on t h e d a t e of b r e a c h . However, t h e amount o f t h e
d a m a g e s d u e upon b r e a c h was n o t c l e a r l y a s c e r t a i n a b l e u n t i l
d e t e r m i n e d by t h e t r i a l c o u r t . T h i s Court has i n t e r p r e t e d t h e
s t a t u t e t o mean t h a t no i n t e r e s t c a n r u n u n t i l a f i x e d amount of
d a m a g e s h a s b e e n a r r i v e d a t , e i t h e r by a g r e e m e n t , a p p r a i s a l , or
judgment. S c h o o l D i s t . N o . 1 v . Globe & Republic I n s . Co.
( 1 9 6 5 ) , 1 4 6 Mont. 208, 404 P.2d 889. S i n c e t h i s is n o t a n a c t i o n
o n a n e g o t i a b l e i n s t r u m e n t o r f o r t h e d e f i n i t e u n p a i d b a l a n c e of
a c o n t r a c t or a c c o u n t , see A g r i l e a s e , I n c . v . Gray ( 1 9 7 7 ) , 1 7 3
Mont. 1 5 1 , 566 P.2d 1 1 1 4 ; Sun R i v e r C a t t l e C o . v . M i n e r ' s Bank of
Montana ( 1 9 7 4 ) , 1 6 4 Mont. 479, 5 2 5 P.2d 1 9 ; w h e r e t h e damages a r e
a sum c e r t a i n , s e c t i o n 27-1-211, MCA, is n o t a p p l i c a b l e .
I n t e r e s t f r o m t h e d a t e o f judgment a t t h e l e g a l r a t e o f 1 0 % p e r
annum is a l l o w a b l e u n d e r s e c t i o n s 25-9-204 a n d 25-9-205, MCA.
The case is remanded f o r m o d i f i c a t i o n o f t h e j u d g m e n t to
p r o v i d e i n t e r e s t a t 1 0 % f r o m t h e d a t e o f j u d g m e n t and a s s o
mod i f i e d , t h e j u d g m e n t is a f f i r m e d .
Chief J u s t i c e