KRONE v. McCANN , 219 Mont. 353 ( 1986 )

No. 8 4 - 2 8 4
IN THE SUPREME COURT OF THE STATE OF MONTANA
1985
MAXINE KRONE, individually and as
Guardian Ad Litem for BRYAN KRONE,
a minor, and CRAIG KRONE,
Plaintiffs and Appellants,
REX T. McCANN, DOROTHY G. McCANN,
and SUPERIOR HOMES, INC.,
Defendants and Respondents.
APPEAL FROM: District Court of the Fourteenth Judicial District,
In and for the County of Musselshell,
The Honorable Peter L. Rapkoch, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Craig R. Buehler, Montana Legal Services Assn.,
Lewistown, Montana
For Respondent:
Maurice R. Colberg, Jr.; Hibbs, Sweeney, Colberg &
Koessler, Billings, Montana
- --
Submitted on Briefs: Oct. 3, 1 9 8 5
Decided: January 7, 1986
JAN 7 - 1986
Filed:
Clerk
Mr. Justice Fred J. Weber delivered the Opinion of the Court.
The Fourteenth Judicial District Court for Musselshell
County determined reasonable attorney fees under a contract
for deed. The court held that the homestead of the
plaintiffs was subject to execution upon the judgment for
attorney fees. Plaintiffs appeal. We affirm the District
Court.
The issues on appeal are:
1. Did the District Court abuse its discretion in its
determination of reasonable attorney fees to be awarded the
defendants?
2. Was the plaintiffs' property on which a homestead
was filed subject to execution based upon the judgment for
attorney fees and costs?
Plaintiffs purchased approximately 60 acres of land in
Musselshell County from defendants under a written contract
for deed and later sued the defendants in connection with
such contract. Under the first appeal in Krone v. McCann
(1982), 197 Mont. 380, 642 P.2d 584, this Court remanded the
cause to the District Court for determination of the attorney
fees and costs to be awarded to the defendants as the
prevailing party. The facts are detailed in that opinion.
The District Court subsequently determined the amount of the
attorney fees and costs, and the defendants appealed that
award to this Court. In a second appeal, this Court
concluded that the District Court had been arbitrary in
arriving at an award of attorney fees without an adequate
evidentiary basis. This Court vacated the award and remanded
the cause for an appropriate determination of attorney fees
based on the criteria set forth in Krone v. McCann (Mont
1983), 666 P.2d 766, 40 St.Rep. 1207.
The homestead declaration issue was submitted to the
District Court under an agreed statement of facts. By order
dated March 20, 1985, the District Court cancelled the stay
upon the levy of execution, which had been made under the
judgment for a-ttorney fees and costs. The District Court
held that attorney fees are a debt secured by vendor's lien
and that the homestead therefore was subject to execution
under the provisions of 5 70-32-202(1), MCA.
With regard to the issue of attorney fees, the written
contract for deed provided as follows:
If either of the parties shall be
required to bring suit to enforce any of
the terms hereof, including the terms for
cancellation of the contract, in the
event of default, the losing parties
shall pay to the prevailing parties, a
reasonable attorney fee, to be fixed in
amount by the Court.
A hearing was held by the District Court. Defendants
submitted substantial evidence, including lengthy testimony
by two of the attorneys who had represented the defendants.
Without detailing the evidence, we note that the exhibit of
attorney fees incurred showed the da.te, nature of services,
and amount of time expended by the attorneys for the
defendants. This exhibit consisted of 6 single-spaced,
type-written pages. The District Court made 3 pages of
findings of fact with regard to the costs, disbursements and
attorney fees. The District Court awarded costs the
amount of $1,457.40 and attorney fees in the amount of
$21,578.50. The court pointed out that after careful
consideration of the facts, the arguments of counsel, and the
guidelines provided by the decisions of this Court, the
District Court was convinced of the reasonableness of the
fees.
The plaintiffs appeal from both of these determinations.
Did the District Court abuse its discretion in its
determina-tion of reasonable attorney fees to be awarded the
defendants?
The plaintiffs argue that because the purchase price for
the 60 acres of property was only $28,000, it is unreasonable
to allow a.n award of attorney fees in excess of $21,000. The
plaintiffs also argue for various ad.ditiona1 reductions in
the fees awarded upon various other theories.
The plaintiffs actually failed to submit any
significance evidence to offset the evidence submitted by the
defendants in support of their application for attorney fees
and costs. The plaintiffs failed to meet the standards set
forth in Alan D. Nicholson, Inc. v. Cannon (Mont. 1984) , 674
P.2d 506, 41 St.Rep. 86. In Nicholson, we considered
attorney fees awarded under a written contract for deed and
set forth the various circumstances which are to be
considered by a district court in fixing such fees. We will
not set them forth in detail here, but do point out that the
findings of fact in the present case indicate that the
District Court considered these various elements or
circumstances. In Nicholson, this Court also emphasized that
it has held that:
". . . [Tlhe amount fixed as attorney
fees is largely discretionary with the
District Court. We will not disturb its
judgment in the absence of the abuse of
that discretion." Carkeek v. Ayer,
(Mont. 1980), 613 P.2d 1013, 1015, 37
St.Rep. 1274, 1276. Given the complex
circumstances of this litigation, we find
no abuse of discretion in either the
award of the fees and costs to Nicholson
or in the amounts awarded.
Nicholson, 674 P.2d at 508, 41 St.Rep. 88-89.
The ,foregoing quotation is particularly applicable to
the present case. Here we have complex factual claims which
have been battled back and forth through two prior appeals to
this Court and numerous proceedings at the district court
level. The extensive testimony and evidence submitted by the
defendants established the character and importance of the
litigation, the amount and character of services rendered,
the labor, time, trouble involved, the professional skill and
experience on the part of the counsel, and the good results
for the defend.ants. Our review of the evidence shows there
was substantial evidence to support the findings and
conclusions of the District Court. We find no abuse of the
discretion in the District Court's determination of attorney
fees.
We affirm the District Court's determination of costs
and attorney fees.
Was the plaintiffs' property on which a homestead was
filed subject to execution based upon the judgment for
attorney fees?
In its consideration of the homestead issue, the
District Court properly considered and quoted the following
in its opinion and order:
Section 70-32-201, MCA. Homestead exempt
from execution generally. The homestead
is exempt from execution or forced sale,
except as in this chapter provided.
Section 70-32-202, MCA. Execution
allowed under certain judgments. The
homestead is subject to execution or
forced sale in satisfaction of judgments
obtained:
(1) on debts secured by ...
vendors'
liens upon the premises.
The District Court pointed out that the contract for
deed contained the following provision:
It is agreed that thirty days is a
reasonable and sufficient notice to be
given second parties in case of their
failure to perform the terms hereof, and
that the same s h a l l be sufficient to
cancel all oblisations herein on the part
of the first and fully re-invekted
- - -all right, title and interest
it with
hereby agreed to be conveyed and second
~arties shall forfeit all payments made
by them in this contract; - and their
right, title and interest in the
buildings, fences, or other improvements
whatsoever . .
. and it [first party]
shall have the right to re-enter and take
possession of the premises aforesaid
. .. (Emphasis supplied.)
The District Court concluded that the terms of the
contract gave to the defendants a vendor's lien. The court
then pointed out that under the attorney fee paragraph, if a
party were required to bring suit to enforce any of the terms
of the contract, the losing party should pay reasona.ble
attorney fees. The court concluded that the contract wa.s a
unit and tha.t the vendor's lien applied to the attorney fees
as well as the contract purchase price. The court then
concluded that under § 70-32-202(1), MCA, the homestead was
subject to execution because it was execution upon a debt
secured by a vendor's lien.
Plaintiffs argue that § 71-3-1301, MCA, is controlling
and contradicts the holding of the District Court. That
section provides in part:
- -of seller - - property - waiver.
Lien of real
(1) One who sells real property has a
vendor's ,lien thereon, independent of
possession, for so much of the price as
remains unpaid and unsecured otherwise
than by the personal obligation of the
buyer.
Plaintiffs' argument is that under this code section,
the vendor's lien extends only to the purchase price for the
real property itself. That would be an appropriate zrgument
if defendants had sold the property to the plaintiffs without
any statement as to the effect of nonpayment and the only
instrument in writing was a promise to pay the purchase
price. In that circumstance, § 71-3-1301, MCA, does create a
vendor's lien which can be enforced. under statutory
provisions.
In the present case, the contract for deed sets forth
the nature and extent of the vendor's lien. As we have
previously discussed, that lien does extend to the attorney
fees. We therefore conclude that S 71-3-1301, MCA, does not
constitute a limitation as argued by the plaintiffs.
We affirm the holding of the District Court that
attorney fees and costs are a debt secured by a vendor's lien
under the provisions of S 70-32-202 (1), MCA, and that as a
result, the homestead claimed by the plaintiffs is subject to
execution or forced sale in satisfaction of the judgment
obtained in the District Court.
We affirm the order and judgment of the District Court.
We concur: