Leasing, Inc. v. Discovery Ski Corp. ( 1988 )

No. 8 8 - 1 6 6
IN THE SUPREME COURT OF THE STATE OF MONTANA
1988
LEASING, INC., a Montana corporation,
Plaintiff and Respondent,
-vs-
DISCOVERY SKI CORPORATION, a Montana
corporation, and PETER PITCHER,
Defendants and Appellants.
APPEAL FROM: District Court of the First Judicial District,
In and for the County of Lewis & Clark,
The Honorable Gordon Bennett, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
J. Allen Bradshaw, Philipsburg, Montana
For Respondent:
Richard J. Pyfer; Small, Hatch, ~ o u b e k& Pyfer,
Helena, Montana
Submitted on Briefs: Nov. 3, 1 9 8 8
Decided: December 13, 1 9 8 8
.,-
-
-c
Clerk
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.
Defendant Discovery Ski Corporation (Discovery) appeals
from an order of the First Judicial District, Lewis and Clark
County, requiring Discovery to dismiss its action against
Leasing, Inc. (Leasing) filed in Justice Court, Granite
County, on the grounds that filing the Justice Court action
was an abuse of process. We affirm.
The question presented on appeal is: Did the District
Court correctly dismiss Discovery's action as an abuse of
process and a breach of contract terms when Discovery filed a
complaint in Justice Court in Granite County with full
knowledge that an action had previously been filed against it
by Leasing in Lewis and Clark County?
Leasing is a Helena business that leased fire
suppression equipment to Discovery. On October 10, 1986,
Leasing filed a complaint against Discovery in the Lewis and
Clark District Court for breach of contract.
The complaint alleged that on August 7, 1987, Discovery
agreed to lease fire suppression equipment from Leasing for a
term of ten years at $165.00 per month; that Leasing
performed its part of the contract; and that Discovery now
refuses to make its payments. The contract signed by the
parties contains the following language:
13. The LESSOR and LESSEE agree that any cause of
action filed as a result of a breach or violation
of any terms of this agreement shall be filed in
the City of Helena, Lewis and Clark County, State
of Montana.
The LESSOR and LESSEE understand and agree that
performance of this agreement is in the City of
Helena, J,ewis and Clark County, State of Montana.
The sequence of events leading to this dispute is as
follows:
October 11, 1986, Peter Pitcher, an officer of
Discovery, was served with summons and complaint in this
action, by certified mail. The cause of action was for
failure to pay sums owed to Leasing under the lease.
October 14, 1986, defendant Discovery was served in the
same manner.
October 23, 1986, Pitcher filed a complaint in Justice
Court in Granite County, Philipsburg, Montana, against
Leasing. The complaint alleged that Leasing failed tc
comply with the Montana Fire Code in that Leasing failed
to install an automatic electric power shut off device
which is required by law.
October 28, 1986, the Granite County summons and
complaint were served by the sheriff on Neil Flaherty
(not a party to this action) as owner of Leasing.
November 13, 1986, Leasing made a motion to consolidate
the Granite County justice court action and the Lewis
and Clark County action on the ground that the subject
matter was the same. The motion was denied December 12,
1986.
November 18, 1986, Leasing served summons and complaint
on Pitcher and Discovery by sheriff's service.
December 11, 1986, Discovery, without Pitcher, made a
special appearance and a motion to dismiss Leasing's
action on the ground that jurisdiction had attached in
Granite County.
May 15, 1987, Leasing moved for default on the first
action on both Discovery and Pitcher for failure to
appear. A hearing on that motion was set for May 28,
1987.
May 26, 1987, Discovery and Pitcher made a special
appearance to dismiss Leasing's action and at the same
time responded to Leasing's motion for entry of default
for failure to answer by asserting that no answer was
due because the previous motion to dismiss for lack of
jurisdiction had not heen ruled on. They also noted
they would not appear at the May 28, 1987 hearing on the
motion for default.
The general rule of venue is that the proper place of
trial for all civil actions is in the county in which the
defendants . .
. reside at the commencement of the action.
Section 25-2-118, MCA; see also Deimler v. Ostler (1979), 183
Mont. 480, 600 P.2d 814. However, in actions upon
contracts, venue is governed by S 25-2-121(b), MCA: The
proper place of trial for actions upon contracts is:
. .
. (b) the county in which the contract was to
be performed. The county in which the contract is
to be performed is:
(i) the countv named in the contract as the place
of performance,. ..
The contract between Leasing and Discovery contains
express terms that the place of performance is Helena, in
Lewis and Clark County. The terms of this contract are not
contradicted.
When, at the time of contracting, the parties have
agreed upon a particular county wherein they mutually
intended their contract - - - performed such agreement
was to be
will be respected and given effect for it is a part of the
freedom of contract to select the place where the contract
will be performed. Hardenburgh v. Hardenburgh (1944), 115
Mont. 469, 146 P.2d 151.
The contract before us, signed by all parties, plainly
indicates that it was the mutual intention of the parties at
the time of contracting that the contract was to be performed
in Lewis and Clark County and any action brought on the
contract was to be brought in Lewis and Clark County.
Nonetheless, Discovery, with full knowledge of the
pending Lewis and Clark County District Court suit by
Leasing, filed an action against Leasing, in the Justice
Court of Granite County. This was an attempt by Discovery to
thwart the plain provisions of the written contract, and a
use of t h e c o u r t system t o accomplish t h a t g o a l . Such a c t i o n
c o n s t i t u t e d a n abuse of p r o c e s s . Rrault v. Smith ( 1 9 8 4 ) , 209
Mont. 2 1 , 28-29, 6 7 9 P.2d 2 3 6 , 240.
The D i s t r i c t Court i s a f f i r m e d .
Justice