Mularoni v. Bing

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No. 00-766

IN THE SUPREME COURT OF THE STATE OF MONTANA

2001 MT 215

HUMBERT MULARONI, SR., MARY JO

MULARONI, HUMBERT MULARONI, JR.,

EDWARD MULARONI, DEAN MULARONI,

MARC MULARONI, and PETER MULARONI,

Plaintiffs/Appellants,

v.

DOUGLAS K. BING and JODEAN M. BING,

Defendants/Respondents.

APPEAL FROM: District Court of the Eighteenth Judicial District,

In and for the County of Gallatin,

The Honorable Thomas A. Olson, Judge presiding.

COUNSEL OF RECORD:

For Appellants:

Christopher K. Williams, Bozeman, Montana

For Respondents:

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Allan H. Baris, Moore, O'Connell & Refling, Bozeman, Montana

Submitted on Briefs: April 19, 2001
Decided: October 29, 2001

Filed:

__________________________________________

Clerk

Justice Patricia O. Cotter delivered the Opinion of the Court.

¶1 Plaintiffs, Humbert Mularoni, Jr., Edward Mularoni, Dean Mularoni, Marc Mularoni,
and Peter Mularoni (Mularonis), filed a complaint in the Eighteenth Judicial District Court
in Gallatin County, seeking a declaratory judgment limiting the scope of Douglas and
Jodean Bing's (Bings) easement across Mularonis' property. Bings counterclaimed for a
declaration that the easement was a general access easement. The District Court entered
judgment in favor of Bings, finding the easement was a general access easement and
Bings were entitled to construct a road across it. The District Court awarded some costs to
Bings, including the court cost associated with Bings' motion to compel, but concluded
Mularonis were not responsible for the costs of the Humbert Mularoni Sr. deposition.
Mularonis appeal the District Court's conclusions of law and judgment, while Bings cross-
appeal the court's denial of the Mularoni deposition costs, and the District Court's failure
to award attorney's fees and expenses associated with the motion to compel.

¶2 We restate the issues as follows:

1. Whether the District Court erred in construing the scope of the easement as a
general access easement; and

2. Whether the District Court erred in determining which of the claimed costs and
fees should be awarded to the prevailing party.

We affirm in part, and reverse and remand in part.

FACTUAL BACKGROUND

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¶3 Neither party disputes the District Court's findings of fact. The tracts of land at issue in
this matter are located in Gallatin County, approximately five miles north of Big Sky. The
tracts are adjacent to one another, and are identified as Tract 1 (divided into Tracts 1-A
and 1-B) and Tract A-1, with Tract A-1 situated directly south of Tract 1. Bings, the
Defendants, currently own Tracts 1-A and 1-B (Tract 1), while Mularonis, the Plaintiffs,
own Tract A-1. The easement at issue in this matter is located on Tract A-1, and is
adjacent to Tract 1-B. A history of the lands' acquisition and subdivision is important to
the resolution of the issues before us.

¶4 In 1986, Alvard and Venice Linford (Linfords) owned both Tracts 1 and A-1. In the fall
of that year, Bings expressed an interest in purchasing a piece of Linfords' Tract 1 along
with the buildings (house and guest house) located on the property. Because a portion of
the guest house was located on Tract A-1, boundary realignment was necessary to ensure
the building rested completely within the boundaries of Tract 1. In addition, Linfords
agreed to divide Tract 1, (approximately a ten acre area) into two pieces, so Bings could
purchase the southern three acres, which included the buildings. Bings reserved an option
to buy the remaining acres of Tract 1 (i.e., Tract 1-A), and Linfords granted Bings right of
first refusal on Tract A-1.

¶5 In October of 1986, Linfords retained Ray Center (Center), a registered land surveyor,
to prepare certificates of survey (COSs) in preparation for the sale to Bings. Center
simultaneously prepared two COSs (1348 and 1348A), which were signed by Center and
Linfords on October 28, 1986, and recorded January 28, 1987. Center realigned the
boundary between adjacent Tracts 1 and A-1, as evidenced by COS 1348. Center also
subdivided Tract 1 into Tracts 1-A (northern portion) and 1-B (southern portion), as
evidenced by COS 1348A. Center created the necessary easements for the subdivision,
and noted them on each respective COS. We now describe the formation and creation of
each COS.

¶6 As illustrated by COS 1348, (the boundary realignment between Tracts 1 and A-1),
Center designated three easements affecting the tracts. First, Center drew in freehand an
"EXISTING DRIVEWAY," that ran northward across Tract A-1 to the southern boundary
of Tract 1. Second, near the middle of Tract A-1, Center designated a 90' x 140'
rectangular easement and labeled it "EASEMENT FOR TRACT 1 ALTERNATIVE
DRAINFIELD." Center testified that his intention in designating this easement was to
create a replacement drainfield if the seepage pit, which was located closer to the guest
house, failed.

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¶7 The third easement Center designated was trapezoid-shaped and adjoined the northern
boundary of the drainfield easement and the southern boundary of Tract 1. Center labeled
this easement: "EASEMENT FOR ACCESS WEST OF GUEST HOUSE/GARAGE AND
TO SEEPAGE PIT AND ALTERNATIVE DRAINFIELD FOR TRACT 1." The
"EXISTING DRIVEWAY" easement connected to Tract 1 at the western triangular
portion of the trapezoid easement. In addition to the maps of the tracts and easements,
Center included the following granting clause on page two of COS 1348, under the
heading "EASEMENT FOR ACCESS AND DRAINFIELD PURPOSES:"

The owners of Tract 1, Certificate of Survey No. 1348, Gallatin County, Montana,
their heirs, and assigns, are hereby granted an easement for access and drainfield
construction, maintenance, and replacement, as shown on the accompanying
Certificate of Survey, over and across Tract A-1, Certificate of Survey No. 1348,
Gallatin County, Montana.

This clause was signed by Linfords and Center on October 28, 1986. Center testified that
in designating the trapezoid easement, he intended to create only access to the drainfield
on Tract A-1, not to create a general access easement across Tract A-1 to Tracts 1-B or 1-
A. It is this trapezoid easement which gave rise to this litigation.

¶8 Simultaneous to realigning Tracts 1 and A-1, Center subdivided Tract 1 into 1-A
(northern half) and 1-B (southern half), which allowed Bings to purchase the three-acre
portion of Tract 1 and the buildings (i.e., Tract 1-B). For this subdivision, Center prepared
COS 1348A, and also provided the appropriate easements for the new tracts. On COS
1348A, Center designated a 30-foot road easement which appeared to connect with the
"EXISTING DRIVEWAY" and the trapezoid easement, as noted on COS 1348. This 30-
foot road easement extended east along the southern boundary of Tract 1-B, and then ran
north across Tract 1-B to Tract 1-A. Center labeled this easement, "30' ROAD
EASEMENT FOR FUTURE ROAD ACCESS TO TRACT 1-A." Center included the
previously created easements from COS 1348 on this second COS. On COS 1348A, he
labeled the rectangular easement as "EASEMENT FOR ALTERNATIVE DRAINFIELD
FOR TRACT 1-B." His label for the trapezoid easement differed from COS 1348, and
simply read, "ACCESS EASEMENT." Thus, after Tract 1 was subdivided, Tract A-1, to
the south, was burdened by three easements: (a) the existing road/driveway; (b) the
rectangular alternative drainfield site; and (c) the trapezoid shaped easement. [SEE
APPENDIX A for drawing of the tracts.]

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¶9 On October 29, 1986, Linfords conveyed Tract 1-B to Bings by warranty deed, which
described the land conveyed as "Tract 1-B of Certificate of Survey 1348A." In reviewing
the deed at closing, Douglas Bing studied COS 1348A, and felt comfortable that the
trapezoid easement was a general access easement as he had negotiated with Linfords.
When Bings purchased Tract 1-B, they had an option to purchase Tract 1-A to the north,
and also a right of first refusal on Tract A-1 to the south.

¶10 In 1987, Linfords found a buyer for Tract A-1. Concerned about having a stranger for
a neighbor, Bings contacted a family friend, John Malpeli, about purchasing Tract A-1 if
Bings exercised their right of first refusal. Malpeli agreed, and on September 1, 1987,
Linfords conveyed Tract A-1 to Bings by warranty deed, which described the property as
"Tract A-1 of Certificate of Survey 1348." Bings then transferred Tract A-1 to Malpeli on
September 2, 1987.

¶11 Two years later, Linfords conveyed Tract 1-A to Bings on October 10, 1989. The
warranty deed described the property as "Tract 1-A of Certificate of Survey 1348A."

¶12 On December 31, 1990, Malpeli conveyed Tract A-1 to the Mularonis, the Plaintiffs
and Appellants here. In this warranty deed, the land description refers to "Tract A-1 of
Certificate of Survey 1348."

¶13 The deeds associated with conveying these tracts involved various references to COS
1348 and COS 1348A; however, none of the deeds specifically referred to the trapezoid
easement on Tract A-1. All the deeds referred to the "existing driveway" easement that
runs from the southern portion of A-1, north to the southern boundary of Tract 1-B, using
language that noted this roadway easement was to be jointly used by the owners of Tracts
1-A and 1-B of COS 1348A and the owners of Tract A-1 of COS 1348. In addition, all
three deeds conveying Tract A-1 (Linfords to Bings; Bings to Malpeli; and Malpeli to
Mularoni) contained a covenant prohibiting construction of a residence on the hill in the
northwest portion of Tract A-1.

¶14 In the spring of 1998, Bings informed Mularonis they intended to utilize the "access
easement," as depicted on COS 1348A. Bings wanted access to an area on the northern
part of their property, and felt the steep grade of the area where the existing driveway
meets the 30' road easement on Tract 1-B prevented location of an access road at that
position. Bings instead planned to build an access road connecting the existing driveway
to the southern boundary of Tract 1-B by building across the trapezoid easement. The

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Mularonis objected and informed Bings they did not have authorization to do any work on
Tract A-1.

¶15 In May, 1998, Bings constructed an access road across the trapezoid-shaped easement
that ran from the existing driveway easement in a northeast direction, connecting to the
southern boundary of Tract 1-B. In September, 1998, Mularonis filed a complaint,
requesting a declaratory judgment that the trapezoid easement was not for general access,
and that construction of the road constituted a trespass. After Bings filed their
counterclaim, seeking a declaration that the easement was a general access easement, both
parties began the discovery process.

¶16 The original plaintiffs in this action were the five Mularoni children. Humbert
Mularoni Sr., (Humbert Sr.) and his wife, Mary Jo, were later added as parties upon the
request of Bings. Although Humbert Sr. was not an owner of the property, he had
interacted with Bings in the preceding years and was involved in providing written
answers to discovery. Bings deposed Humbert Sr. in July of 1999, but he was unable to
provide all the information sought by Bings. Bings also wished to depose the Mularoni
children, all of whom lived outside of Montana. On August 9, 1999, Bings sent notices of
deposition to the Mularoni children (Humbert Jr., Edward, Dean, Marc, and Peter),
noticing depositions for August 18, 1999. Mularonis responded that they would not be
able to attend, due to the short notice, and asked that Bings either travel to them or take the
depositions by phone.

¶17 On August 25, 1999, Bings filed a motion to compel attendance at depositions and
requested sanctions (attorney's fees and costs related to bringing the motion). Mularonis
filed a response and motion for protective order, requesting the court deny the motion to
compel. Mularonis asserted the Mularoni children were not involved in the management
or purchase of the property at issue and requested the court order telephonic depositions if
necessary. On September 22, 1999, the District Court granted Bings' motion to compel
and ordered the two most knowledgeable adult children to appear for depositions in
Montana. Bings thereafter deposed Edward and Dean Mularoni in October of 1999.

¶18 The District Court held a bench trial on April, 12, 2000. All the relevant deeds and
COSs, as described above, were admitted into evidence for the court to consider. In
addition, testimony and survey maps showed that, because of steep terrain, the westerly
portion of the 30' easement was impractical to use, and/or support an access road.

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¶19 On August 23, 2000, the District Court entered its findings of fact and conclusions of
law. In its conclusions of law, the court concluded the trapezoid easement was for general
access, and that the access road constructed by Bings was within the scope of the easement
and therefore did not constitute a trespass. The court concluded Bings, as prevailing
parties, were entitled to costs in this matter.

¶20 Bings filed a memorandum of costs with the court and included a $10 cost for the
successful motion to compel and $254.20 in costs for Humbert Sr.'s deposition. Mularonis
objected to the charges for the motion to compel and the deposition, since Humbert Sr.'s
deposition was not used at trial. On September 18, 2000, the District Court held that
Mularonis were not responsible for the deposition cost, but were responsible for the $10
cost.

¶21 Mularonis appeal the District Court's conclusions that the language describing the
trapezoid easement is clear and unambiguous, that the scope of the easement allows a
general access road, and that Bings were entitled to costs of suit. In their cross-appeal,
Bings challenge the District Court's denial of Humbert Sr.'s deposition costs and the
attorney's fees and expenses associated with the successful motion to compel.

STANDARD OF REVIEW

¶22 We review findings of a trial court sitting without a jury to determine if the district
court's findings are clearly erroneous. Rule 52(a), M.R.Civ.P.; Espy v. Quinlan, 2000 MT
193, ¶ 14, 300 Mont. 441, ¶ 14, 4 P.3d 1212, ¶ 14 (citing Daines v. Knight (1995), 269
Mont. 320, 324, 888 P.2d 904, 906). A finding is clearly erroneous if it is not supported by
substantial evidence, if the trial court misapprehended the effect of the evidence, or if this
Court is left with a definite and firm conviction that the district court made a mistake.
Espy, ¶ 14. We review a district court's conclusions of law de novo to determine whether
they are correct. McCauley v. Thompson-Nistler, 2000 MT 215, ¶ 18, 301 Mont. 81, ¶ 18,
10 P.3d 794, ¶ 18 (citing Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 474-
75, 803 P.2d 601, 603). In reviewing a district court's award of costs, the standard of
review is whether the district court abused its discretion. Gilluly v. Miller (1995), 270
Mont. 272, 274, 891 P.2d 1147, 1148. Finally, we review imposition of sanctions for a
lack of compliance with discovery procedures for abuse of discretion. Delaware v. K-
Decorators, Inc., 1999 MT 13, ¶ 86, 293 Mont. 97, ¶ 86, 973 P.2d 818, ¶ 86 (citing
McKenzie v. Scheeler (1997), 285 Mont. 500, 506, 949 P.2d 1168, 1172.

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DISCUSSION

Issue I

¶23 Did the District Court err in construing the scope of the trapezoid easement as a
general access easement?

¶24 In analyzing the scope of the trapezoid easement, we must determine what source
defined it: "[t]he extent of a servitude is determined by the terms of the grant or the nature
of the enjoyment by which it was acquired." Section 70-17-106, MCA; Leffingwell Ranch,
Inc. v. Cieri (1996), 276 Mont. 421, 430, 916 P.2d 751, 756. Therefore, we must address
the terms of the grant, including any COS that defines the easement in question. We first
determine what, if any, COS is incorporated into the deeds. Second, we determine which
of such COSs applies, and finally, we address the ultimate issue of the scope of the
trapezoid easement.

¶25 The District Court concluded in its conclusions of law that the incorporation of COS
1348A into the warranty deed between Linfords and Bings effectively created both the
drainfield and trapezoid easements. Neither party disputes this conclusion.

¶26 However, relying on the doctrine of merger, Mularonis contend the District Court
erred by considering COS 1348A and the warranty deed in ultimately construing the
easement's scope. Essentially, Mularonis argue that, when Bings took title to Tract A-1
from Linfords, before conveying A-1 to Malpeli one day later (See ¶ 10 herein), a merger
of titles occurred, and therefore, the easements were extinguished. See § 70-17-111, MCA.
The District Court impliedly rejected this argument, as evidenced by its holding that the
trapezoid easement burdening Tract A-1, benefitted both Tracts 1-B and 1-A. This benefit
to the two parcels is determinative of the merger argument.

¶27 According to Restatement (Third) of Property: Servitudes § 5.7 (2000), "When
property benefited or burdened by a servitude is divided into separately owned parcels, the
rights and obligations that run with each of the separately owned parcels are as follows . . .
(1) Each separately owned parcel is entitled to make the uses privileged by an easement or
profit; . . . . " "If [a] dominant tenement is transferred in separate parcels to different
persons, 'each grantee acquires a right to use easements appurtenant to the dominant
estate, provided the easements can be enjoyed as to the separate parcels without any
additional burden on the servient tenement.' " 7 Thompson on Real Property, Thomas

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Edition, § 60.07(b)(3) (David A. Thomas et al. eds., 1994).

¶28 After the initial conveyance, Tract A-1 was burdened by three easements: the existing
driveway; the alternative drainfield easement; and the trapezoid easement. The deeds
conveying Tract A-1 all referred to COS 1348, where the trapezoid easement was depicted
as benefiting Tract 1. Certificate of Survey 1348 also included a granting clause to the
owners of Tract 1 for "an easement for access and drainfield construction, maintenance,
and replacement," across Tract A-1. Following the subdivision of Tract 1, Linfords
conveyed Tract 1-B to Bings, and continued to possess Tract 1-A. When Linfords
conveyed Tract A-1 to Bings, they still possessed Tract 1-A, and thus continued to benefit
from the access easement. When Tract 1-B and later Tract 1-A were conveyed to Bings,
they acquired the same right to use easements appurtenant to the dominant estate as
Linfords previously enjoyed.

¶29 It is true, as Mularonis argue, that a servitude may be terminated when all the benefits
and burdens come into a single ownership. Restatement (Third) of Property: Servitudes §
7.5 (2000). When the burdens and benefits are united in a single person, or group of
persons, the servitude ceases to serve any function, and because no one else has an interest
in enforcing the servitude, the servitude terminates. Restatement (Third) of Property:
Servitudes § 7.5 cmt. a (2000). However, in order to extinguish an easement by merger,
there must be unity of title or ownership, coextensive in validity, quality, and all other
circumstances of right. 28A C.J.S. Easements, § 123 (1996).

[A]n easement is not extinguished under the doctrine of merger by the acquisition
by the owner of the dominant or servient estate of title to only a fractional part of the
other estate [See Crease v. Jarrell, 224 P. 762 (Cal.App. 1924)]. For the unity of
title to extinguish an easement, it is the ownership of the two estates that must be
coextensive, and not the land area comprising the dominant and servient estates
[citation omitted]; the common ownership need not extend to the whole of the
original dominant estate [citation omitted]; and thus, the common ownership of the
servient estate and several of the dominant estates extinguishes the easement as to
those lots. [See Cheever v. Graves, 592 N.E.2d 758 (Mass.App.Ct. 1992)].

28A C.J.S. Easements, § 123 (1996).

¶30 When Bings owned Tracts 1-B and A-1, a common ownership occurred, which
arguably extinguished any easements as between those two tracts. However, because the

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trapezoid easement on Tract A-1 benefitted both sub-tracts within Tract 1, Linfords
retained a benefit from the easement at the time Bings owned both Tracts 1-B and A-1.
Thus, when Linfords conveyed Tract 1-A to Bings, that same benefit was conferred on
Bings. We therefore conclude the District Court's ruling that both Tracts 1-A and 1-B
benefited by the trapezoid easement is supported by substantial evidence, and therefore
will not disturb its conclusion in that regard.

¶31 As an alternative to the merger argument, Mularonis contend the District Court erred
when it concluded that the language describing the trapezoid easement was not
ambiguous, and that Center's testimony regarding the parties' intent does not control. The
District Court held that Center's testimony did not overcome the clear meaning of the
writings on both COSs. We agree with the District Court that the language used to
describe the trapezoid easement was clear and unambiguous, and created a general access
easement.

¶32 A transfer of property is to be interpreted in like manner with contracts in general.
Section 70-1-513, MCA. In interpreting the meaning of an easement grant, contract
principles apply. Van Hook v. Jennings, 1999 MT 198, ¶¶ 11-12, 295 Mont. 409, ¶¶ 11-12,
983 P.2d 995, ¶¶ 11-12. Construction and interpretation of written agreements is a
question of law for the court to decide. Johnson v. Nyhart (1995), 269 Mont. 379, 387, 889
P.2d 1170, 1174 (citations omitted). Whether ambiguity exits in a contract is also a
question of law. In re Marriage of Holloway, 2000 MT 104, ¶ 5, 299 Mont. 291, ¶ 5, 999
P.2d 980, ¶ 5. Whenever the terms of an agreement have been reduced to writing by the
parties, it is to be considered as containing all those terms. Section 28-2-905, MCA.
Finally, the breadth and scope of an easement are determined upon the actual terms of the
grant. Section 70-17-106, MCA; See Van Hook, ¶ 12.

¶33 The incorporation of COS 1348A into the deeds conveying Tracts 1-B and 1-A to
Bings effectively and clearly described the easements in question. Certificate of Survey
1348A clearly marks the drainfield and trapezoid easements. The trapezoid easement is
labeled as "ACCESS EASEMENT," with no other limits or qualifications. In addition,
COS 1348, which was referenced by each deed conveying Tract A-1, explicitly granted to
the owners of Tract 1, "an easement for access and drainfield construction, maintenance,
and replacement . . . ." We conclude there is substantial evidence to support the District
Court's findings, and that the trial court did not misapprehend the effect of such evidence.
Therefore, we hold that the District Court was correct in its conclusions of law and Bings
are entitled to a general access across the trapezoid easement.

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Issue 2

¶34 Whether the District Court erred in determining which costs and fees should be
awarded to the prevailing party.

¶35 Two distinct questions regarding fees and costs are presented: first, whether the
District Court erred in failing to award attorney's fees associated with Bings' successful
motion to compel, pursuant to Rule 37(d) M.R.Civ.P.; and second, whether Bings were
entitled to certain deposition costs pursuant to either § 25-10-201, MCA, or Rule 37(d) M.
R.Civ.P. In analyzing these issues, we rely on the following facts from the record.

¶36 On August 9, 1999, Bings served all five Mularoni children with a notice of
deposition, to take place August 18, 1999, in Bozeman, Montana. Through counsel, the
children informed Bings the time noticed was impractical due to the travel distance
required, and offered to set up telephonic depositions. Bings agreed to take three
depositions by phone if at least two of the five would appear in person. Mularonis did not
accept this compromise, and none of the children appeared for depositions on August 18,
1999.

¶37 Bings filed a motion to compel attendance at depositions and for sanctions with
supporting memorandum. Based on the Mularoni children's failure to attend their
depositions, Bings requested the court grant relief pursuant to Rule 37(d), M.R.Civ.P.,
specifically including a prayer for attorney's fees in their request. Bings argued that the
children were the original plaintiffs in the matter, and that Bings had attempted to
coordinate the depositions with the Mularonis' trips to Montana. In the motion to compel,
Bings did not mention Humbert Sr.'s deposition, other than to note it had already occurred.

¶38 Mularonis filed a response and motion for protective order, claiming the notice to the
Mularoni children was insufficient and that the depositions should be taken by phone
instead of in person.

¶39 The District Court entered an order granting Bings' motion to compel, in part. The
court ordered the two most knowledgeable adult children to appear in Montana for
depositions. In its order, the court noted that the original plaintiffs in this matter were the
Mularoni children, Bings offered to schedule depositions at times when the children would
be in Montana, and Bings also agreed to depose three of the five children by telephone, as
long as two were taken in person. In its ruling on the motion, the District Court made no

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findings regarding costs, other than to charge Mularonis with "the expenses of the
depositions taken in Montana."

¶40 On September 24, 1999, two days after the court entered its order, Bings filed a reply
brief on the motion. In the reply, Bings asserted that in his deposition, Humbert Sr. failed
to provide meaningful information regarding the properties in question, and therefore
Bings needed to depose the Mularoni children. Bings attached a copy of Humbert Sr.'s
deposition as an exhibit, and referenced it throughout the reply brief. The record indicates
this information was not before the District Court when it ruled on the motion to compel
two days earlier.

¶41 Following the trial, the District Court granted Bings, as the prevailing party, "costs in
this matter." Bings filed a memorandum of costs which included $254.20 to cover the
"expense of taking deposition of Humbert Mularoni . . . (used in Motion to Compel)."
Other than a $10 cost, pursuant to § 25-10-202, MCA, Bings did not list any other
expenses or attorney's fees associated with its motion to compel.

¶42 Mularonis objected to the $254.20 deposition charge, relying on § 25-10-201, MCA,
noting that no portion of the deposition was used at trial or cited in the motion to compel.
In response to the objection, Bings conceded the deposition was not cited in the motion to
compel, but asserted the entire deposition was submitted as an exhibit with the reply brief,
and argued that the deposition costs were recoverable because the deposition was filed
with and used by the court.

¶43 In its order and findings regarding costs, the District Court denied Bings the costs of
Humbert Mularoni Sr.'s deposition, relying on our decision in Fisher v. State Farm Ins.
Companies (1997), 281 Mont. 236, 934 P.2d 163.

¶44 On cross-appeal, Bings challenge the District Court's conclusions under Fisher,
arguing the deposition was not used for the mere convenience of counsel. Alternatively,
Bings contend the deposition costs are recoverable as part of the costs associated with the
motion to compel. In addition, Bings maintain the District Court ignored their request for
attorney's fees contained in their motion to compel. We first address the question of
attorney's fees associated with a motion to compel.

¶45 Our standard of review of sanctions imposed for a lack of compliance with discovery
procedures is whether the district court abused its discretion. Delaware, ¶ 86. We have

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consistently held that a party's abuse of discovery rules is better punished than encouraged.
Delaware, ¶ 87 (citations omitted). This judicial intolerance of discovery abuses is
supported by our concern with overcrowded dockets and the need to maintain fair and
efficient judicial administration of pending cases. Delaware, ¶ 87.

¶46 In its motion to compel, Bings sought relief under Rule 37(d) of the Montana Rules of
Civil Procedure, which reads in relevant part:

If a party or an officer, director, or managing agent of a party or a person designated
under Rule 30(b)(6) or 31(a) to testify on behalf of a party fails (1) to appear before
the officer who is to take the deposition, after being served with a proper notice, . . .
the court in which the action is pending on motion may make such orders in regard
to the failure as are just, and among others it may take any action authorized under
paragraphs (A), (B), and (C) of subdivision (b)(2) of this rule. In lieu of any order or
in addition thereto, the court shall require the party failing to act or the attorney
advising that party or both to pay the reasonable expenses, including attorney's
fees, caused by the failure, unless the court finds that the failure was substantially
justified or that other circumstances make an award of expenses unjust.

The failure to act described in this subdivision may not be excused on the ground
that the discovery sought is objectionable unless the party failing to act has applied
for a protective order as provided by Rule 26(c). [Emphasis added.]

¶47 We have not previously interpreted the above-emphasized language of Rule 37(d), as
it relates specifically to an award of attorney's fees. However, in Delaware, we applied 37
(b)(2), M.R.Civ.P., which includes mandatory language regarding attorney's fees that is
identical to that contained in Rule 37(d), M.R.Civ.P. We noted the language of the rule
was "strict;" and that:

a district court must sanction those who disobey a discovery order by ordering them
to pay the other party's reasonable expenses, including attorney fees, which arise
because of the failure to comply with a discovery order, unless the court finds that
the failure to comply with the order was substantially justified, or that other
circumstances make an award of expenses unjust. The party attempting to avoid
Rule 37(b)(2), M.R.Civ.P., sanctions has the burden of proving that its failure to
comply with the order was "substantially justified," or that other circumstances
make such an award unjust. See Hyde & Drath v. Baker (9th Cir. 1994), 24 F.3d

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1162, 1171 (citing Falstaff Brewing Corp. v. Miller Brewing Co., (9th Cir. 1983),
702 F.2d 770, 784) (interpreting the identical federal rule).

Delaware, ¶ 89 (emphasis added).

¶48 The same rationale applies with equal force to the identical language of Rule 37(d).
Upon motion, the district court is mandated to assess reasonable expenses, including
attorney's fees, against the party failing to appear for a duly noticed deposition, unless the
court finds substantial justification or circumstances that make an award of such expenses
unjust.

¶49 In its ruling on the motion to compel, the District Court failed to award attorney's fees
to Bings and made no findings to justify why it would be unjust to award them. Absent
such justification, we conclude the District Court erred by not awarding Bings attorney's
fees associated with their motion to compel. Therefore, we remand this matter to the
District Court to assess the appropriate attorney's fees associated with Bings' successful
motion to compel, unless the court on remand finds and recites substantial justification
making such an award unjust.

¶50 We now address the Humbert Sr. deposition expense, and whether Bings are entitled
to recovery pursuant to either Rule 37(d) M.R.Civ.P., or § 25-10-201, MCA.

¶51 First, Bings argue the costs associated with deposing Humbert Sr., are expenses
associated with the motion to compel, and pursuant to Rule 37(d), M.R.Civ.P., they are
entitled to those costs. However, our reading of the record indicates that when the District
Court ruled on Bings' motion to compel, it was not aware of the ineffectiveness of
Humbert Sr.'s deposition. More to the point, Bings did not cite the deposition as a basis for
their motion. We therefore find the District Court did not abuse its discretion by not
awarding the costs of this deposition to Bings pursuant to Rule 37(d).

¶52 Bings also appeal the trial court's ruling that the Humbert Sr. deposition costs are not
recoverable costs under § 25-10-201, MCA. Bings requested the award of deposition costs
pursuant to § 25-10-201, MCA. Bings analogized the summary judgment motion in Fisher
to the motion to compel in this matter, and argued that since the deposition was filed with
the court, it is a recoverable cost.

¶53 In reviewing a district court's award of costs, the standard of review is whether the

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court abused its discretion. Gilluly, 270 Mont. at 274, 891 P.2d at 1148. Section 25-10-
201, MCA, identifies the costs that may be awarded in an action. That statute provides in
relevant part: "A party to whom costs are awarded in an action is entitled to include in his
bill of costs his necessary disbursements, as follows: . . . (2) the expenses of taking
depositions; . . . ." Section 25-10-201, MCA. "We have consistently interpreted § 25-10-
201(2), MCA, to allow costs for depositions in only limited circumstances where the
depositions were relied upon by the district court, or were used in a trial setting." Fisher,
281 Mont. at 239, 934 P.2d at 164. We have held that deposition costs are allowed: when a
deposition is used at trial as evidence or for impeachment (Gilluly, 270 Mont. 272, 891
P.2d 1147); and when a deposition is filed with the district court, and used by the court in
a dispositive summary judgment motion (Roy v. Neibauer (1981), 191 Mont. 224, 227-28,
623 P.2d 555, 557). Deposition costs are not allowed when the purpose of the deposition is
merely to assist the requesting party in compiling its case, and is taken only for the
convenience of counsel. McGinley v. Ole's Country Stores, Inc. (1990), 241 Mont. 248,
250, 786 P.2d 1156, 1157. Depositions which are not used at trial are for the "convenience
of counsel" and are not recoverable costs. Gilluly, 270 Mont. at 276, 891 P.2d at 1149.

¶54 In Fisher, we declined to award costs of depositions where an insured plaintiff
accepted and received an offer of judgment from the defendant, and then requested costs
associated with his claim. We held the insured was not entitled to recover deposition costs
because the depositions were not "filed with the District Court," were not used as evidence
for the purpose of impeachment, and were not used by the district court in "deciding a
dispositive summary judgment motion." Fisher, 281 Mont. at 239, 934 P.2d at 165.

¶55 Here, Humbert Sr.'s deposition was not used at trial, either as evidence or for
impeachment purposes. Nor was the deposition relied on by the District Court in its ruling
on the motion to compel. Moreover, the motion to compel was not a dispositive motion.
We therefore conclude the District Court correctly declined to award the costs associated
with the Humbert Sr. deposition pursuant to § 25-10-201, MCA.

¶56 In conclusion, we affirm the District Court's rulings that the trapezoid easement was a
general access easement and that the Bings are not entitled to the costs of Humbert Sr.'s
deposition under either Rule 37(d), M.R.Civ.P., or § 25-10-201, MCA. However, pursuant
to the mandatory language of Rule 37(d), M.R.Civ.P., we reverse the District Court's
refusal to award Bings attorney's fees associated with the motion to compel, and remand
for further proceedings consistent with this opinion.

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/S/ PATRICIA COTTER

We Concur:

/S/ KARLA M. GRAY

/S/ W. WILLIAM LEAPHART

/S/ TERRY N. TRIEWEILER

/S/ JIM REGNIER

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