HARES v NELSON

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No. 81-246 IN THE SUPREME COURT OF THE STATE OF MONTANA 1981 I. J. HARES and IRMA HARES, husband and wife, Plaintiffs and Respondents, RONALD W. NELSON, Defendant and Appellant. Appeal from: District Court of the Thirteenth Judicial District, In and for the County of Carbon Honorable William J. Speare, Judge presiding. Counsel of Record: For Appellant: Sally M. Johnson, Red Lodge, Montana For Respondents: Joseph E. Mudd, Bridger, Montana Submitted on briefs: July 30, 1981 Decided : M 2 3 V Filed: 2 5 1981 I$@ Mr. J u s t i c e Gene B . D a l y d e l i v e r e d t h e O p i n i o n of t h e C o u r t . Defendant-appellant, Ronald Nelson, appeals from a judgment e n t e r e d i n t h e T h i r t e e n t h J u d i c i a l D i s t r i c t C o u r t of the State of Montana, William Speare p r e s i d i n g . Carbon County, T h i s judgment the Honorable t e r m i n a t e d a con- t r a c t f o r d e e d b e t w e e n t h e p l a i n t i f f s and t h e d e f e n d a n t d u e t o defendant's default; subject of defendant the to granted p o s s e s s i o n of contract sign all to the the property plaintiffs; necessary documents ordered the convey his to i n t e r e s t t o p l a i n t i f f s ; and awarded r e a s o n a b l e a t t o r n e y f e e s i n t h e amount of $872.50 p l u s c o s t s t o t h e p l a i n t i f f s . Plaintiffs, contract for December 29, of land I. deed and J. with the Irma Hares, defendant, entered Ronald into Nelson, a on 1 9 7 8 , whereby N e l s o n was t o p u r c h a s e 365 a c r e s plus some buildings. The property, s i t e , i s l o c a t e d i n Carbon C o u n t y , Montana. t h e Hares rented their together with annum. N e l s o n was t o pay $1,000, with no old this downpayment, town After the s a l e , r e s i d e n c e on t h i s p r o p e r t y . r e n t e r s a l s o r e m a i n e d on t h e p r o p e r t y . p r i c e was $ 9 2 , 7 5 0 , an Other The t o t a l p u r c h a s e i n t e r e s t of i n monthly beginning 8 percent per i n s t a l l m e n t s of April 1, 1 9 7 9 . N e l s o n made p a y m e n t s A p r i l t h r o u g h O c t o b e r 1 9 7 9 . No payment was made on November 1, 1 9 7 9 . The con- t r a c t r e q u i r e d w r i t t e n n o t i c e s t o be g i v e n and t o be s e r v e d upon the parties personally address in the contract or for by registered Ronald Nelson mail. was P. The 0. Box mail and 255323, S a c r a m e n t o , C a l i f o r n i a 95825. The plaintiffs gave notice of a l s o t h r o u g h t h e Carbon County s h e r i f f . default Within t h e f i f t e e n d a y s a l l o w e d by c o n t r a c t t o c u r e t h e d e f a u l t , t h e $ 1 , 0 0 0 payment. However, by N e l s o n made he d i d n o t p a y t h e a t t o r n e y f e e s r e q u e s t e d i n t h e n o t i c e and r e q u i r e d by t h e c o n t r a c t . No January f u r t h e r p a y m e n t s were made o n t h e c o n t r a c t . 1980, Eric Brabec, a grandson of the Hares, In at- t e m p t e d t o g i v e N e l s o n a n a c c o u n t i n g and a c h e c k f o r r e n t a l s collected rejected from by the buildings Nelson. A t on the the property. time, same T h i s was Brabec informed N e l s o n t h a t a d e f a u l t n o t i c e was w a i t i n g f o r him a t h i s p o s t o f f i c e box i n Red Lodge, Montana. also sent contract. to the California A n o t i c e of address as d e f a u l t was required by the N e i t h e r n o t i c e was e v e r c l a i m e d . The H a r e s t h e n d e c l a r e d t h e f u l l o u t s t a n d i n g b a l a n c e on t h e c o n t r a c t d u e and p a y a b l e on F e b r u a r y 8 , 1 9 8 0 . A t no t i m e d i d N e l s o n o f f e r t o make f u l l payment on t h e c o n t r a c t ; h e o f f e r e d o n l y t h e amount i n a r r e a r s . The n o t i c e f o r t h e b a l a n c e was a l s o m a i l e d b u t u n c l a i m e d . No p a y m e n t s w e r e made t o c u r e t h e d e f a u l t . The H a r e s b r o u g h t s u i t s e e k i n g t o compel N e l s o n t o e x e c u t e a l l n e c e s s a r y documents t o t e r m i n a t e h i s i n t e r e s t i n t h e c o n t r a c t f o r deed. N e l s o n a n s w e r e d and c o u n t e r c l a i m e d f o r a n i n j u n c t i o n t o r e t a i n p o s s e s s i o n o f t h e p r o p e r t y p e n d i n g t h e outcome o f the action, contract. as well as for specific performance of the N e l s o n c o n t e n d e d t h a t a n o r a l a g r e e m e n t had b e e n r e a c h e d by t h e p a r t i e s t o f o r e s t a l l p a y m e n t s on t h e c o n t r a c t u n t i l a p r o p e r a c c o u n t i n g of Hares and collected from t h e r e n t s r e c e i v a b l e from t h e other renters by the Hares on b e h a l f o f N e l s o n was made. Trial on D i s t r i c t Court t h i s matter found was held June 2, 1980. t h a t no a g r e e m e n t e x i s t e d t o p r e v e n t foreclosure proceedings. The D i s t r i c t C o u r t e n t e r e d f i n d - i n g s of f a c t and c o n c l u s i o n s o f l a w on J a n u a r y 1 6 , 1 9 8 1 . judgment The i n accordance with s u c h f i n d i n g s and was e n t e r e d on F e b r u a r y 3 , 1 9 8 1 . A conclusions The issues presented on appeal are: 1. Did the trial court err in declaring a forfei- 2. Did the trial court err in awarding attorney fees ture? to the respondents? Appellant Nelson contends that this Court should apply section 28-1-104, MCAI to prevent a forfeiture. That section provides: "Relief from forfeiture. Whenever by the terms of an obligation a party thereto incurs a forfeiture or a loss in the nature of a forfeiture by reason of his failure to comply with its provisions, he may be relieved therefrom upon making full compensation to the other party, except in case of a grossly negligent, willful, or fraudulent breach of duty. I' Two important reasons exist for not applying section 28-1-104, MCA, in this instance. First, there is nothing in the record to indicate that appellant ever complied with section 28-1-104, MCA, by making full compensation to the respondents. Second, appellant made no claim to the District Court that section 28-1-104, MCA, was controlling. There- fore, since this section was not addressed by the trial court, this Court cannot review the application of statute or the issue presented by it on appeal. 8(c) and 12(b), M.R.Civ.P. Mont. we held: , the See Rules In Chadwick v. Giberson (1980), 618 P.2d 1213, 1215, 37 St.Rep. 1723, 1726, "However, it is also a well-settled rule of law that alleged error as to issues not raised in trial court will not be considered on appeal." See also, State v. Armstrong (1977), 172 Mont. 296, 562 P.2d 1129; Spencer v. Robertson (1968), 151 Mont. 507, 445 P.2d 48; Clark v. Worrall (1965), 146 Mont. 374, 406 P.2d 822. The trial court did not err when it declared a forfeiture and terminated the contract for deed. In Suburban Homes Co. v . N o r t h ( 1 9 1 4 ) , 50 Mont. 1 0 8 , 1 1 7 , 1 4 5 P. 2, 5, t h i s Court held: " I f payment i s t o b e made i n i n s t a l l m e n t s , d e f a u l t i n t h e payment o f a n y i n s t a l l m e n t i s a d i s t i n c t b r e a c h and g i v e s t h e vendor t h e right to declare a forfeiture. The r i g h t m u s t b e p r o m p t l y e x e r c i s e d , however; o t h e r wise, t h e r i g h t being e x c l u s i v e l y t h a t of t h e p l a i n t i f f , h e w i l l be presumed t o r e g a r d t h e c o n t r a c t a s s t i l l v a l i d and e x i s t e n t . " T h i s r u l e was r e a f f i r m e d i n Hansen v . ( 1 9 7 8 ) , 1 7 5 Mont. 273, 573 P.2d 663. Transamerica I n s . Co. T h i s Court i n Suburban Homes went on t o s a y : "If t h e l a t t e r ( t h e vendee) continues i n d e f a u l t , t h e v e n d o r , by demand f o r payment o f t h e b a l a n c e o f t h e p u r c h a s e money and n o t i c e of h i s p u rp o s e t o t e r m i n a t e t h e c o n t r a c t i n c a s e o f f u r t h e r d e f a u l t , may p u t t h e v e n d e e upon h i s g u a r d . I f a f t e r such n o t i c e he d o e s n o t make payment w i t h i n a r e a s o n a b l e t i m e , t h e v e n d o r may d e c l a r e t h e c o n t r a c t a t a n end." 1 4 5 P. a t 5 . I n t h i s c a s e a p p e l l a n t d i d n o t make p a y m e n t s on t h e c o n t r a c t f o r two m o n t h s . N o t i c e was s e n t by r e g i s t e r e d m a i l t o h i s a d d r e s s a s p e r t h e t e r m s o f t h e c o n t r a c t and t o a Red Lodge, Montana, a d d r e s s . Respondents s t r i c t l y complied w i t h t h e d e f a u l t terms of t h e contract. The a p p e l l a n t d i d n o t . A p p e l l a n t c o n t e n d s t h a t t h e r e a s o n he d i d n o t p a y a n y a t t e n t i o n t o t h e n o t i c e s o f d e f a u l t was b e c a u s e h e t h o u g h t a n o r a l c o n t r a c t f o r a n o f f s e t had been e n t e r e d i n t o b e t w e e n himself modify and r e s p o n d e n t s . the written The a l l e g e d o r a l c o n t r a c t was t o contract by allowing the appellant to o f f s e t r e n t , owed t o him by r e s p o n d e n t s , a g a i n s t t h e m o n t h l y p a y m e n t s t h a t were d u e on t h e c o n t r a c t f o r d e e d . However, t h e t r i a l c o u r t f o u n d t h a t no s u c h o r a l c o n t r a c t was e n t e r e d i n t o and t h a t a t b e s t t h e r e was m e r e l y a n a g r e e m e n t t o d i s c u s s some f o r m o f o f f s e t . MCA, which altered by agreement, provides a that contract F u r t h e r , u n d e r s e c t i o n 28-2-1602, "[a] contract i n writing and n o t o t h e r w i s e , " or by i n w r i t i n g may b e an executed oral t h e r e could n o t have been a proper modification of the written contract. Finally, the only recourse available to the appellant after he had failed to respond to the notices of default and forfeiture would have been to tender full compensation to respondents. tion 28-1-104, MCA. Sec- Appellant at no time offered to tender full compensation; the best he offered was to tender the payments owed. The appellant argues that he did not receive effective notice according to the terms of the contract. The contract states: "It is further mutually agreed between the parties hereto that any notice to be given hereunder shall be served upon the parties ; personally or by reqistered o certified mail directed to the party or parties to be served at their respective addresses as set forth, to wit "Buyer -- Ronald W. Nelson P. 0 . Box 255323 Sacramento, California (Emphasis added. ) 98525" Not only did respondents send notice to appellant at the California address, but they also sent notice to his Red Lodge, Montana, address. Further, Eric Brabec informed the appellant that a notice of default was at the post office in Red Lodge. Under the circumstances, the notice was suffi- cient, and the fact that notice of an earlier default was personally delivered does not mean that the mailed notices were in any way defective under the terms of the contract. Appellant's final contention is that the trial court erred in awarding attorney fees to respondents. The contract states: "In the event of default of the Buyer, Buyer agrees to reimburse the Seller, on demand, for all costs and expenses of whatsoever nature incurred by the Seller in enforcing any of the provisions of this agreement, including but not limited to, a reasonable attorney's fee for attorneys employed by the Seller in connection with the said default." I t is c l e a r t h a t t h e c o n t r a c t f a i r l y provided f o r an award o f a t t o r n e y f e e s i n t h e e v e n t o f a d e f a u l t . The t r i a l c o u r t j u s t l y awarded t h e f e e s i n a c c o r d a n c e w i t h t h e t e r m s of t h e contract. The judgment o f t h e D i s t r i c t C o u r t i s a f f i r m e d . /I Justice We concur: V

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