Davidson v. Lewis

No. 13843
IN THE SUPREME COURT OF THE STATE OF MONTANA
1978
RUTH DAVIDSON,
Plaintiff and Appellant,
-vs-
LELAND J. LEWIS,
Defendant and Cross Complainant,
and
SHARON R. LEWIS,
Cross Defendant and Appellant.
Appeal from: District Court of the Eighteenth Judicial
District,
Honorable W. W. Lessley, Judge presiding.
Counsel of Record:
For Appellant:
Seth F. Bohart argued, Bozeman, Montana
For Respondent:
William E. Gilbert, Bozeman, Montana
Brown, Pepper and Kommers, Bozeman, Montana
Gene Brown argued, Bozeman, Montana
Submitted: March 2, 1978
Decided: MAY . ,- 1978
Filed: MY 9 972
, .
Clerk
Mr. Justice Daniel J. Shea delivered the Opinion of the Court.
Plaintiff Ruth Davidson and cross-defendant Sharon Lewis
appeal from a judgment of the District Court., Gallatin County,
which decreed that defendant Leland Lewis owed plaintiff $1,400
as the balance due on a loan.
Defendant and Sharon Lewis were married in 1969. In
1971, they borrowed $5,400 from plaintiff, who is Sharon Lewis'
mother, for the down payment on a house located in Bozeman, Mon-
tana. They verbally agreed to repay the loan, apparently without
interest, in $100 monthly installments. They made such payments
until their divorce in 1973.
Prior to the entry of their divorce decree, defendant
and Sharon Lewis entered into a written property settlement agree-
ment which provided, among other things, that defendant would pay
child support, that he would pay the balance owing on an auto-
mobile which was to be transferred to Sharon Lewis, and that he
would pay the balance of the loan from plaintiff. The balance of
the loan was $2,800 at that time.
Shortly after their divorce, defendant and Sharon Lewis
met and discussed the property settlement agreement. Their testi-
mony regarding this meeting is conflicting. Defendant testified
Sharon Lewis agreed he would not have to pay child support, she
would pay for the automobile she received under the property
settlement agreement, and she agreed to pay plaintiff the balance
owing on the loan. Sharon Lewis testified she told defendant he
would not have to pay child support until he had paid off the
automobile, she did not agree to pay for the car herself, and
she did not agree to pay all or any part of the $2,800 balance
on the loan from plaintiff.
Defendant made no payments on the loan from plaintiff
either before or after the meeting with his former wife. He con-
tinued to pay child support and he paid off the automobile as
well, notwithstanding the agreement allegedly made at the meeting.
Sometime after the divorce, Sharon Lewis sold the house
she received under the property settlement agreement. She gave
$1,400 from the proceeds of this sale to plaintiff. At trial
both Sharon Lewis and plaintiff characterized this transaction
as a loan.
On December 6, 1976, plaintiff brought the present action
in District Court, Gallatin County, seeking to recover $2,800, the
amount she alleged was owing on the loan from her to defendant
and Sharon Lewis. Defendant answered and cross-claimed against
his former wife, alleging she had agreed to pay the balance owing
on the loan. The case was heard by the District Court sitting
without a jury. On April 14, 1977, the District Court entered
findings of fact and conclusions of law, ruling defendant owes
plaintiff $1,400, the amount found to be the balance due on the
loan. Plaintiff and Sharon Lewis moved to amend the findings of
fact and conclusions of law and for a new trial. After a hearing
their motions were denied, judgment was entered, and this appeal
followed.
The issue presented for review is whether the evidence
supports the District Court's findings of fact and conclusions
of law and judgment.
Appellants contend the written property settlement agree-
ment is controlling, and since it provided that defendant was to
pay the entire $2,800 balance owing on the loan from plaintiff,
the District Court erred in ruling defendant liable for a lesser
amount.
There is no dispute that when they received the loan
from plaintiff, Sharon Lewis and defendant became jointly obli-
gated for its repayment. Plaintiff, therefore, could have sued
either or both of them for the balance due on the loan. Morgen &
Oswood v. U.S. Fidelity and Guaranty, (1975), 167 Mont. 64, 69,
535 P.2d 170. Since plaintiff was not a party and did not con-
sent to any property settlement agreement entered into by Sharon
Lewis and defendant, any such agreement did not affect plaintiff's
right to seek performance of their joint promise to repay from
either of them. Gambles v. Perdue, (19771, Mont . I
572 P.2d 1241, 34 St.Rep. 1549, 1551, 1552. Nothing in the Dis-
trict Court's findings of fact or conclusions of law is inconsistent
with any of the above stated general principles.
Another well established principle with respect to joint
contracts is the obligee is entitled to only one full performance.
As it is stated in 4 Corbin on Contracts, S935, p. 764:
"An obligee who receives a payment or a sub-
stituted satisfaction, in part or in full, from
any of two or more parties who are bound to him
for one and the same performance, cannot pre-
vent it from operating as a discharge of the
other obligors in like measure. * * * "
By concluding that $1,400 is the balance due on the loan, the
District Court implicitly found the money Sharon Lewis transferred
to plaintiff should be applied to the balance owing on the loan
prior to that transfer. That conclusion is consistent with the
principle of pro tanto discharge set out above. The dispute here
is whether that conclusion is consistent with the evidence pre-
sented to the District Court.
Appellants contend the evidence shows Sharon Lewis in-
tended to treat the $1,400 as a loan to plaintiff, that the
written property settlement agreement conclusively establishes
she was under no obligation to repay any part of the loan, and
that the District Court therefore could not properly conclude the
loan's balance was reduced as the result of the transfer of $1,400
to plaintiff. ~ppellantsdeny pro tanto discharge is applicable
on these facts.
Appellants are correct in their contention that the al-
leged oral modification of the written property settlement agree-
ment cannot have the effect of altering the written agreement.
Section 13-907, R.C.M. 1947, provides that an oral agreement must
be executed to alter a contract in writing. Section 13-727, R.C.M.
1947, defines an executed contract as one " * * * the object of
which is fully performed * * *." Since the object of the alleged
oral agreement in the present case would be payment of the entire
balance due on the loan, and since Sharon Lewis paid less than
that amount, any such oral agreement was not fully performed.
Additionally, the record does not show any consideration
was given for the alleged oral agreement. By defendant's own
testimony he suffered no prejudice and Sharon Lewis received no
benefit by entering into the alleged modification of the written
property settlement agreement.
The District Court therefore erred in concluding the writ-
ten property settlement was altered by a subsequent oral agreement
between defendant and Sharon Lewis. As between those parties, the
written property settlement agreement remains in full force and
effect.
It does not necessarily follow, however, that the District
Court was wrong in treating the $1,400 transferred to plaintiff
as payment of part of the balance owing on the loan from plaintiff.
The evidence, although in some respects conflicting, supports the
District Court's conclusion that the transfer of $1,400 from ~haron
Lewis to plaintiff was such part payment.
There is no writing showing the $1,400 was intended as
a loan to plaintiff, and Sharon Lewis did not tell defendant's
attorney it was a loan when she spoke to his attorney about it.
She also testified she gave plaintiff the money in part so that
plaintiff could invest and receive interest on the $1,400. This
testimony, combined with defendant's testimony that Sharon Lewis
expressly promised to pay the balance owing on the loan from
plaintiff, casts doubt on appellants' claim that the $1,400 was
in no way related to repayment of that loan.
Furthermore, Sharon Lewis has made no claim against de-
fendant for reimbursement of the $1,400 she transferred to plain-
tiff. Had she intended to hold defendant to the written property
settlement agreement, a logical step in light of defendant's
cross-claim would have been to seek such reimbursement in a timely
manner.
Unless there is a clear preponderance of evidence against
the District Court's findings, this Court will not reverse such
findings. It is the trial court's province to judge the credi-
bility of witnesses and the weight to be given their testimony.
Merritt v. Merritt, (1974), 165 Mont. 172, 177, 178, 526 ~ . 2 d1375.
In applying the $1,400 Sharon Lewis transferred to plain-
tiff to the loan's balance, the District Court merely accepted
one of the offered explanations of that transfer rather than the
other. Whether or not that transfer wasmade in accordance with
a valid oral agreement between Sharon Lewis and defendant, it was
properly found to operate as a discharge of defendant to the ex-
tent of the amount paid.
The judg~nentof the ~istrictCourt is affirmed.
We Concur:
Chief Justice