Justia Montana Supreme Court Opinion Summaries

Appellants and Bank entered a loan agreement in which Bank agreed to lend Appellants $5 million. After Bank refused to disburse further funds under the loan, Appellants sued Bank. Bank was represented by the Crowley Fleck law firm (Crowley). During the ensuing litigation, an attorney that was working with the law firm representing Appellants (Lawyer) joined Crowley as an attorney. Appellants subsequently filed motions to disqualify Crowley from representing Bank in the case and to permanently enjoin Crowley from proceeding in the litigation. The trial court denied Appellants' motion. The Supreme Court reversed, holding that the district court erred in denying Appellants' motions where (1) Lawyer, who was engaged in concrete discussions of future employment with the adversary's law firm, did not promptly inform Appellant, terminate all further discussions concerning the employment, or withdraw from representing Appellant; (2) the conflict was concurrent and thus imputed to Crowley; and (3) the measures Crowley took were inadequate to preserve Appellants' confidences. View "Krutzfeldt Ranch, LLC v. Pinnacle Bank" on Justia Law

The City of Dillon filed a civil action against George Warner seeking to recover the costs of installation of a water meter. Judge Gregory Mohr ruled on several motions filed by the city and conducted a scheduling conference. Warner subsequently filed an affidavit of disqualification against Mohr. The judge that presided over the disqualification proceeding (1) found Warner's affidavit of disqualification was insufficient as a matter of law and was therefore void; and (2) ordered that Mohr would maintain jurisdiction. The district court dismissed Warner's appeal, finding that the city court order concerning Warner's attempt to disqualify Mohr was an interim order and was therefore not appealable. The Supreme Court affirmed, holding (1) the district court properly dismissed Warner's appeal, as it was from an interim order and not a final judgment; and (2) the district court's orders dismissing the appeal were interim orders and thus not appealable to the Court. View "City of Dillon v. Warner" on Justia Law

James Whealon was employed by the Anaconda School District pursuant to a series of employment contracts. Upon retirement, Whealon filed a formal grievance, asserting that, under the terms of his contract, he was entitled to payment of his health insurance premiums by the District until he reached the age of sixty-five. The District denied his claim. The County Superintendent granted summary judgment to the District, holding that the language of the contract was unambiguous and that Whealon was not entitled to the claimed benefits beyond the date of his retirement. The State Superintendent of Public Instruction reversed and remanded for an evidentiary hearing, holding that the language of the contract was ambiguous. The district court reversed and reinstated the County Superintendent's ruling. The Supreme Court affirmed the district court, holding (1) the district court did not err in holding that a county superintendent has authority to grant summary judgment; and (2) the district court did not err in reinstating summary judgment in favor of the district where the language of the agreement was unambiguous and the District was entitled to judgment. View "Anaconda Public Schools v. Whealon" on Justia Law

Campbell Farming Corporation had its shares controlled by three shareholders: Stephanie Gately controlled fifty-one percent of the shares, and H. Robert Warren and Joan Crocker controlled the remaining forty-nine percent. Stephanie awarded her son, Robert Gately, who was president of the company, a bonus after a vote by the shareholders. Warren and Crocker filed a derivative and direct action against the company and the Gatelys in federal district court seeking to void the bonus. The district court entered judgment in favor of Defendants. The Supreme Court accepted certification from the Tenth Circuit to answer several questions and held (1) the safe harbor provision of Mont. Code Ann. 35-1-462(2)(c) can be extended to cover a conflict-of-interest transaction involving a bonus that lacks consideration and would be void under Montana common law; (2) the business judgment rule does not apply to situations involving a director's conflict-of-interest transaction; and (3) the holding in Daniels v. Thomas, Dean & Hoskins does not apply to the claim challenging Stephanie's role in the director conflict of interest transaction, but the Daniels test does apply to the claim of breach of fiduciary duties alleged by the minority shareholders against Stephanie in her capacity as majority shareholder. View "Warren v. Campbell Farming Corp." on Justia Law

Gary Martin and Lewistown Miller Construction Company entered into a written contract for the construction of a dwelling on Martin's property. When construction was completed, Martin refused to pay additional amounts above the bid price, and LMCC filed a construction lien on the property. LMCC then filed suit, seeking damages for breach of contract, unjust enrichment, and foreclosure of the lien. Martin counterclaimed for declaratory relief that the lien was invalid and to quiet title, among other things. The district court (1) granted foreclosure of LMCC's construction lien and awarded damages to LMCC; and (2) denied LMCC's and Martin's request for attorney fees. The Supreme Court affirmed in part and reversed in part, holding (1) the district court did not err in ordering foreclosure of the construction lien, and the award of damages was not clearly erroneous; but (2) the district court erred in failing to award statutorily mandated attorney fees to LMCC, as it established its lien. Remanded. View "Lewistown Miller Constr. v. Martin" on Justia Law

The Fronks (Fronks) purchased two pieces of property from the Collinses (Collins), and the parties entered into an oral agreement whereby Collins would acquire horses and Collins would be entitled to keep the first foal from each mare as payment for their services. Fronks later transferred $215,000 to Collins for the acquisition of the horses. Fronks later deeded the properties back to Collins with the understanding that Collins would reconvey the land back to Fronks within five years. The parties subsequently signed an agreement setting forth each party's obligations. When Collins did not comply with the agreement, Fronks brought an action for breach of contract, breach of implied covenant of good faith and fair dealing, and misrepresentation seeking, inter alia, to enforce the agreement and recover damages, obtain ownership of the real property, and recover attorney fees. The district court determined that the agreement was a valid, enforceable contract and granted summary judgment to Fronks. The Supreme Court affirmed, holding that the agreement was a valid contract and the agreement did not suffer from a lack of consent by virtue of duress or menace. View "Fronk v. Collins" on Justia Law

The Heins rented a house from Julia Benintendi and the Perkerwicz family (hereinafter B&P). B&P alleged the Heins caused considerable damage to the property when they vacated the premises. The Heins countered that B&P unlawfully retained their security deposit and refused to reimburse the Heins for home and lawn improvements. B&P sued and obtained a default judgment. The district court subsequently set aside the default judgment and held a jury trial. B&P were awarded damages but not attorney fees or costs. The Supreme Court affirmed in part and reversed and remanded in part, holding (1) the district court did not abuse its discretion in denying attorney fees to both parties; (2) the district court incorrectly required each party to bear its own costs because, as the prevailing party, B&P was entitled to its costs under Mont. Code Ann. 25-10-101; and (3) the district court did not manifestly abuse its discretion in setting aside the default judgment because it had good cause to do so. View "Benintendi v. Hein" on Justia Law

Employee worked as a shareholder accountant for Employer. Employee's employment contract contained a covenant not to compete. After Employer ended its employment relationship with Employee, Employee began working at Employer's competitor, where she provided accounting services for a few of Employer's former clients in violation of the restrictive covenant. Employee sought a declaration that the covenant was unenforceable. The district court determined that the covenant was reasonable and enforceable. The Supreme Court reversed, holding that Employer's covenant was unenforceable because (1) Montana law requires that an employer establish a legitimate business interest in a restrictive covenant, which demands that the restriction on post-employment activities be necessary to protect an employer's good will, customer relationships, or trade information; (2) an employer lacks a legitimate business interest in a covenant when, under ordinary circumstances, it ends the employment relationship with the employee; and (3) Employer in this case elected to end its employment relationship with Employee without any misconduct on the part of Employee. View "Wrigg v. Junkermier, Clark, Campanella, Stevens, P.C." on Justia Law

After Decedent died, Decedent's wife moved to admit his will to probate. Decedent's son, Bruce, filed an objection, alleging that Decedent lacked testamentary capacity to enter into the will, and that another of Decedent's sons, Neil, exerted undue influence over Decedent. Bruce further sought to set aside a cattle sale and options agreement and lease-cattle agreement, alleging that Decedent's lack of capacity to contract voided the agreements and that the agreements were the product of Neil's undue influence over Decedent. The district court granted the Estate's motion to dismiss, concluding that Bruce lacked standing to contest the will and agreements. The Supreme Court reversed, holding (1) Bruce's allegations that a previous will existed that devised to him a larger portion of Decedent's estate than did the disputed will created a sufficient basis for Bruce to establish standing to contest the will; and (2) Bruce possessed standing to challenge the validity of the agreements to the extent that they concerned real property. Remanded with instructions for the district court to vacate its order to dismiss and to permit the parties to engage in discovery. View "In re Estate of Glennie" on Justia Law

Donald Puhto and his sister, Janet Barrett, commenced an action against Defendant Smith Funeral Chapels, alleging negligence and misrepresentation in the handling of their deceased uncle's remains. Counsel for Puhto and Barrett withdrew from the representation. Defendant's counsel then sent Puhto and Barrett a notice of removal of attorney for plaintiffs informing them of the need to appoint a new attorney or appear in person at a show cause hearing. After Puhto and Barrett failed to respond to the notice of removal and failed to appear at the hearing, the district court dismissed the case with prejudice. The court subsequently set aside the dismissal as to Barrett. The court then denied Puhto's motion to set aside the dismissal and request for an evidentiary hearing, finding that Puhto did not raise sufficient indications of mistake, inadvertence, surprise or excusable neglect under Mont. R. Civ. P. 60(b). The Supreme Court affirmed, holding that Puhto had not shown the district court abused its discretion in determining he had not proven excusable neglect.