96-661
No. 96-661
IN THE SUPREME COURT OF THE STATE OF MONTANA
1997
MONTANA METAL BUILDINGS, INC.,
Plaintiff and Respondent,
v.
DAVID A. SHAPIRO, Individually and d/b/a
BRIDGER AVIATION SERVICES,
Defendant and Appellant.
APPEAL FROM: District Court of the Eighteenth Judicial District,
In and for the County of Gallatin,
The Honorable Larry W. Moran, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Robert Cameron, Gregory O. Morgan; Morgan, Cameron & Weaver
Bozeman, Montana
For Respondent:
Steven R. Milch; Crowley, Haughey, Hanson, Toole & Dietrich,
Billings, Montana
Terry B. Cosgrove, Michael E. Frank; Crowley, Haughey, Hanson, Toole
& Dietrich, Helena Montana
Submitted on Briefs: April 3, 1997
Decided: July 15, 1997
Filed:
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__________________________________________
Clerk
Justice Karla M. Gray delivered the Opinion of the Court.
David A. Shapiro (Shapiro) appeals from the order and decree entered by the
Eighteenth Judicial District Court, Gallatin County, which granted the cross-motion
for
summary judgment filed by Montana Metal Buildings, Inc. (MMB) and foreclosed its
construction lien. We reverse.
The issue on appeal is whether the District Court erred in granting MMB's cross-
motion for summary judgment.
FACTUAL BACKGROUND
On April 14, 1994, MMB submitted a bid proposal to Shapiro, doing business as
Bridger Aviation Services, for the construction of a 60' x 80' metal building on
premises
leased by Shapiro at the Three Forks Airport. Shapiro accepted the bid proposal and
MMB began construction. Thereafter, MMB served a Notice of Claim and Construction
Lien (Lien) on Shapiro on July 31, 1995. It specified that MMB claimed a lien
against
Shapiro's property in the amount of $26,889.43, as the balance due for materials and
labor used in the construction of the metal building.
MMB subsequently sued Shapiro in District Court, seeking judgment in the amount
of $26,889.43, plus interest on that amount from July 31, 1995, and an order of
foreclosure on the Lien. In his answer to the complaint, Shapiro denied that MMB was
entitled to the relief requested and affirmatively alleged that he did not owe MMB
any
additional payments.
Shapiro subsequently moved for summary judgment, asserting that the Lien was
fatally flawed and, therefore, unenforceable as a matter of law. The bases for his
motion
were that the Lien insufficiently described the property to which it purported to
attach and
that statutory notice requirements had not been met. He filed affidavits in support
of his
motion. MMB opposed Shapiro's motion, contending that the Lien sufficiently
described
the property and that the notice provisions did not apply. MMB also filed a cross-
motion
for summary judgment, relying on its brief in opposition to Shapiro's motion and the
affidavit of its president and requesting entry of judgment in its favor against
Shapiro for
the amounts prayed for in its complaint.
At the hearing on the summary judgment motions, the attorneys for both parties
presented their arguments for and against the validity of MMB's Lien. Neither party
presented testimony, although MMB entered a photograph of the Bridger Aviation
Services building it had constructed for Shapiro into evidence.
The District Court subsequently entered a written order denying Shapiro's motion
and granting MMB's motion. The court determined that no issues of material fact
existed
in the case and decreed that the amounts listed in MMB's complaint were due and
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owing,
that they were a first and prior lien on the property and that MMB's Lien be
foreclosed.
The District Court certified its order as a final judgment for purposes of appeal
pursuant
to Rule 54(b), M.R.Civ.P., and Shapiro appeals that portion of the order which
granted
MMB's cross-motion for summary judgment and ordered foreclosure of the Lien.
STANDARD OF REVIEW
Our standard in reviewing a district court's summary judgment ruling is de
novo;
we use the same Rule 56, M.R.Civ.P., criteria as the district court. Clark v. Eagle
Systems, Inc. (Mont. 1996), 927 P.2d 995, 997, 53 St.Rep. 1150, 1151 (citations
omitted). Rule 56(c), M.R.Civ.P., provides, in pertinent part, that
[t]he judgment sought shall be rendered forthwith if the pleadings,
depositions, answers to interrogatories, and admissions on file, together
with the affidavits, if any, show that there is no genuine issue as to any
material fact and that the moving party is entitled to a judgment as a matter
of law.
Summary judgment is an extreme remedy which should never be substituted for a trial
if a material factual controversy exists. Clark, 927 P.2d at 997 (citations
omitted).
The party seeking summary judgment must establish, in light of the pleadings and
other evidence before the court, the absence of any genuine issue of material fact
which
would allow the nonmoving party to recover and entitlement to judgment as a matter of
law. Clark, 927 P.2d at 997-8 (citations omitted). If, but only if, the party
seeking
summary judgment meets this burden, the nonmoving party must come forward with
substantial and material evidence raising a genuine issue of material fact. Clark,
927
P.2d at 998 (citation omitted). "[A]ll reasonable inferences that might be drawn
from the
offered evidence should be drawn in favor of the party who opposed summary
judgment."
Clark, 927 P.2d at 998 (citations omitted).
DISCUSSION
Did the District Court err in granting MMB's cross-motion for summary
judgment?
Shapiro argues that MMB did not establish the absence of genuine issues of
material fact regarding entitlement to the relief prayed for in its complaint.
Specifically,
he contends that MMB presented no testimony or other evidence establishing that he
owed
the amount set forth in MMB's Lien and prayed for in the complaint, or any other
amount. Because his answer to the complaint put the amount MMB sought to recover
at issue, Shapiro asserts that genuine issues of material fact remain for trial which
preclude summary judgment for MMB. Thus, we first address whether MMB met its
initial burden as the party moving for summary judgment.
MMB's complaint alleged, in pertinent part, that it had an interest in certain
property by virtue of the Lien attached to, and incorporated by reference in, the
complaint. It also alleged that Shapiro owed it $26,889.43, plus interest, as
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reflected on
invoices billed to Shapiro for the labor and materials used in the construction of
the metal
building. Copies of the invoices also were attached to, and incorporated by
reference in,
MMB's complaint. As a result of Shapiro's failure to pay, the allegations continued,
MMB filed the Lien. The effect of attaching and incorporating the Lien and the
invoices
is to make those attachments a part of the complaint for all purposes. Rule 10(c),
M.R.Civ.P.; see Gallatin Trust and Savings Bank v. Darrah (1968), 152 Mont. 256, 262,
448 P.2d 734, 737.
In his answer to the complaint, Shapiro denied that the described property was
subject to MMB's Lien, denied that MMB had an interest in the property and denied
that
he owed the amount indicated in the invoices. Shapiro affirmatively asserted that he
owed no further payments to MMB. The denials and affirmative allegation in Shapiro's
answer effectively controverted the factual allegations in MMB's complaint on which
its
prayer for relief was based, thus putting those allegations in issue. See Rule 8(b),
M.R.Civ.P.; Brown v. Ehlert (1992), 255 Mont. 140, 146, 841 P.2d 510, 514.
Rule 56(c), M.R.Civ.P., authorizes summary judgment "if the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact and
that the
moving party is entitled to a judgment as a matter of law." It is clear from MMB's
complaint and Shapiro's answer in this case that MMB was not entitled to summary
judgment based on the pleadings because the allegations on which MMB's prayer for
relief was based were put at issue by Shapiro's answer. In other words, the denials
of
MMB's material allegations in Shapiro's answer created genuine issues of material
fact
and put MMB to its proof. The question then becomes whether MMB came forward with
evidence--via discovery, affidavits or otherwise--to overcome Shapiro's denials and
establish the absence of genuine issues of material fact. See Rule 56(c), M.R.Civ.
P. We
conclude that it did not.
MMB submitted the affidavit of its president, Donald Jones. Jones' affidavit
was
directed at Shapiro's argument that the Lien was materially defective in that it
insufficiently described the property to which it purported to attach; in that
regard, Jones
stated only that MMB provided materials and labor for the construction of the Bridger
Aviation Services metal building and identified the building by location and
description.
Although MMB's Lien is mentioned in the affidavit, no statements are made therein
that
Shapiro owed any amount of money to MMB. In addition to the affidavit, MMB
admitted a photograph of the Bridger Aviation Services building it had constructed
for
Shapiro into evidence at the hearing on the summary judgment motions. Like Jones'
affidavit, the photograph was advanced solely to counter Shapiro's argument about the
sufficiency of the property description.
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The only other items of record which relate to MMB's motion for summary
judgment are its brief filed in the District Court and its counsel's arguments at the
hearing. The brief and arguments also related solely to whether MMB's Lien was, as
Shapiro contended, materially defective; they did not touch on MMB's entitlement to
judgment in the amounts prayed for in the complaint. In any event, however, proof is
required to establish the absence of genuine issues of material fact; a party may
not rely
on the arguments of counsel. City of Bozeman v. AIU Ins. Co. (1993), 262 Mont. 370,
378, 865 P.2d 268, 273.
MMB contends that it presented the District Court with an appropriate
evidentiary
basis to establish the absence of genuine issues of material fact in the form of the
Lien
and the invoices attached to its complaint. These documents were not attached to
MMB's
briefs submitted on the summary judgment motions, were not otherwise filed by MMB
and were not admitted into evidence at the hearing on the motions. While MMB's
argument in this regard is not altogether clear, it is clear that the Lien and the
invoices
became part of the complaint, as discussed above, and were not separately filed or
submitted by MMB. To that extent, they were not evidence of the matters contained
therein, but merely allegations of the complaint. See Gallatin Trust and Savings
Bank,
448 P.2d at 737. Moreover, as discussed above, the denials of those allegations in
Shapiro's answer put the allegations at issue and required additional proof by MMB of
the absence of genuine issues of material fact. MMB advanced no such additional
proof.
MMB also argues that, since Shapiro did not object to the documents attached to
its complaint and which it purports to have used as the basis for its cross-motion,
he
"waived any right to object to the evidentiary basis in support of MMB's cross-motion
for summary judgment." We observe that this argument presupposes the existence in the
record of an evidentiary basis for MMB's motion separate and apart from the complaint
and attachments thereto. As previously noted, no such evidentiary basis exists in
the
record. As a result, we need not address the cases on which MMB relies for its
waiver
theory.
As the party moving for summary judgment, MMB had the initial burden of
producing evidence to establish the absence of any genuine issue of material fact
with
regard to its entitlement to judgment as a matter of law on its complaint. See HKM
Assoc. v. Northwest Pipe Fittings, Inc. (1995), 272 Mont. 187, 193, 900 P.2d 302,
305.
It could not rely on the allegations in its complaint, where those allegations had
been
denied, or the arguments of its counsel. See AIU Ins. Co., 865 P.2d at 273. The
record
reflects that MMB did not satisfy its burden.
The District Court determined that, as a result of the cross-motions for summary
judgment, no issues of material fact existed. However, the fact that both parties
have
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moved for summary judgment does not establish, in and of itself, the absence of
genuine
issues of material fact. Duensing v. Traveler's Companies (1993), 257 Mont. 376,
385,
849 P.2d 203, 209. Cross-motions for summary judgment may support a conclusion that
no genuine issues of material fact exist when the parties are moving for summary
judgment on precisely the same legal issue or theory. In this case, for example, had
MMB moved for partial summary judgment on the sole issue of the legal validity of its
Lien, its cross-motion may have sufficiently mirrored Shapiro's motion so as to
support
the District Court's determination that the mere existence of the cross-motions
established
the absence of material factual issues.Here, however, MMB's motion for summary
judgment went beyond asserting entitlement to judgment on the issue of the legal
validity
of its Lien. It requested judgment for the dollar amounts and other relief prayed
for in
the complaint and, thus, brought into issue whether Shapiro was actually indebted to
MMB for those amounts. As a result, MMB bore the burden of establishing the absence
of genuine issues of material fact regarding the amounts owed by Shapiro and, as
discussed above, it did not satisfy that burden. The District Court's
misapprehension that
cross-motions for summary judgment necessarily preclude the existence of genuine
issues
of material fact led it into error in this case.
We hold that the District Court erred in granting MMB's cross-motion for
summary judgment and in ordering that MMB's Lien be foreclosed.
Reversed.
/S/ KARLA M. GRAY
We concur:
/S/ J. A. TURNAGE
/S/ JAMES C. NELSON
/S/ W. WILLIAM LEAPHART
/S/ WILLIAM E. HUNT, SR.
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