Dooling v. Perry

No. 14260
IN THE SUPREME COURT OF THE STATE OF MONTANA
1979
THOMAS A. DOOLING, et al.,
Plaintiffs and Appellants,
CHARLES PERRY, et al.,
Defendants and Respondents.
Appeal from: District Court of the Fifth Judicial District,
Honorable Gordon Bennett, Judge presiding.
Counsel of Record:
For Appellants:
Thomas A. Dooling, Dillon, Montana
For Respondents:
Poore, Roth, Robischon and Robinson, Butte, Montana
Henningsen, Purcell and Genzberger, Butte, Montana
Submitted on briefs: July 11, 1979
~ecided
: AUG 13 1979
Filed: AUG 1 3 1g.9
Mr. Justice John C. Sheehy delivered the Opinion of the Court.
Plaintiffs Thomas and Margaret Dooling appeal from a
summary judgment entered in favor of the defendants Streeter
Brothers Insurance and Travelers Insurance Company (Travelers).
The summary judgment was entered by the District Court, Fifth
Judicial District, Beaverhead County, the Honorable Gordon R.
Bennett presiding.
Thomas Dooling, an attorney, prepared a contract, dated
October 4, 1975, to be executed by Charles E. Perry, d/b/a
Perry Enterprises, a house-moving contractor. The contract
provided for Perry to move a large log building from Jackson,
Montana, to a new location in Beaverhead County approximately
40 miles distant. The original draft of the contract called
for Perry to begin work on or about October 1, 1975. By
interlineation, the date was amended to read October 13,
1975.
Paragraph 5 of the Dooling-Perry contract required
Perry to (1) procure hazard insurance for the period of the
move in an amount not less than $100,000; (2) pay the premiums
thereon; and, (3) furnish Doolings with satisfactory proof
of such coverage. Paragraph 10 of the Dooling-Perry contract
required Perry to complete performance by November 27, 1975.
Perry's work was not started by October 13, 1975, and
in fact was not completed by July 6, 1976.
Doolings received a letter from Streeter Brothers on
December 1, 1975, confirming a transportation policy with
Travelers. The letter lists Perry as the named insured and the
Doolings as the additional insureds. The text of the letter
reads as follows:
"Dec. 1, 1975
"Dear Mr. Dooling:
"This letter is confirmation of coverage with the
Travelers Ins. Co. per our telephone conversation,
for the transportation policy.
"Named Insured: Charles Perry - dba
Perry Enterprises,
Livingston, Mont.
"Effective: 12/1/75 - Premium $2,000
"Add'l insured: Tom Dooling, Dillon, MT.
"Coverages: split in two sections:
"$20,000 - 30 x 30') $100,000
" 8O,OOO - 60' x 46')
"Meeting all requirements, excluding
earthquake. (Per contract)
"Deductible: $1,000
"Very truly yours,
"STREETER BROS., Inc.
"By: /s/ Richard L. Hall
"Richard L. Hall"
Pursuant to this letter, Travelers issued a hazard insurance
policy to Perry. The policy lists "Charles R. Perry and Elsie
H. Perry, d/b/a Perry Enterprises" as the named insured and
Doolings as a loss-payees. The policy was effective from December
1, 1975 to March 15, 1976, a total of 105 days.
Although Doolings alleged that the log structure was damaged
by collision or upset, which would have been within the coverage
of the insurance policy, the Doolings refused at the summary
judgment hearing to supply the District Court with a
"1information
as to the time of damage.
The original complaint contained a breach of contract action
against Perry as a sole dependent. On December 2, 1976, Doolings
filed an amended complaint adding Streeter Brothers and Travelers
as defendants. Doolings claimed both Streeter Brothers and Travelers
were negligent in (1) failing to provide the insurance coverage
specified in the Dooling-Perry contract; (2) in failing to notify
the Doolings of the expiration date by supplying them with a
copy of the insurance contract; and (3) in issuing the policy
after the casualty occurred.
Streeter Brothers and Travelers each filed a motion for
summary judgment, and on December 29, 1977, the District
Court issued an order granting summary judgments in favor of
these defendants. The District Court could not ascertain any
duty in contract or in tort running from either Streeter
Brothers or Travelers to Doolings.
The only question presented for review is whether there
is any genuine issue of material fact which would preclude
summary judgment in favor of either Streeter Brothers or
Travelers.
In their first claim of negligence, Doolings claimed
Streeter Brothers and Travelers were negligent in not issuing
a policy that conforms to the Dooling-Perry contract.
This contention is without merit. The insurance policy
issued is in the amount required by the Dooling-Perry contract.
Similarly, the policy issued covers all the perils contemplated
by the Dooling-Perry contract.
Moreover, the Dooling-Perry contract contemplates per-
formance within 45 days. The policy issued covers a period of
105 days. It would be absurd to hold either Streeter Brothers
or Travelers negligent in not issuing a policy specifically
covering the period of October 13, 1975 to November 27, 1975,
the date contained in the Dooling-Perry contract. If this were
the case, Perry would have paid premiums for no coverage at all.
Perry did not begin performance by October 13, 1975, as originally
contemplated by the Dooling-Perry contract.
Doolings secondly claimed Travelers was negligent in failing
to notify the Doolings of the expiration date by supplying them
with a copy of the insurance contract.
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For an understanding of this issue, it is necessary to
consider the state of the pleadings before the District Court
at the time of summary judgment. In their fifth pleaded claim,
the plaintiffs contended that Travelers "negligently failed to
provide the insurance coverage specified in the [Dooling-Perry]
contract" and bargained for by Perry with Streeter Brothers.
In their sixth pleaded claim, the plaintiffs claimed a verbal
binder agreement that required Travelers to issue the "casualty
insurance bargained for," and that Travelers did not issue the
policy until after the casualty occurred.
As we have indicated above, the policy issued by Travelers
does in fact provide the coverage bargained for between the
Doolings and Perry in their written contract. The policy term is
for 105 days, which is far more than the 45 days specified in the
Dooling-Perry contract. The Doolings, therefore fail in
their contention that Travelers was negligent in not issuing
a policy specified in the Dooling-Perry contract.
There is no proof in the record (and it was plaintiffs'
duty to supply such proof) of a verbal binder agreement.
Instead, we have a written binder agreement which we have
quoted above. The written binder does not mention a termination
date, but since it was written to conform with the Dooling-
Perry contract, there is no basis to assume any term longer
than the March 15, 1976 expiration date was required or
agreed upon at the time of the issuance of the written
binder.
Section 35-15-42, MCA,does require an insurance carrier
to issue a copy of its policy to those with an insurable
interest as specified in the statute. Conceivably, Travelers
had a duty to issue a copy of its policy here to the Doolings
What is missing in this record, however, is any showing by the
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Doolings that the failure of Travelers to issue a copy of
the policy to them materially affected their right of recovery
against Travelers or Streeter Brothers. The Doolings refused to
inform the District Court when the mishap which damaged the
log structure occurred. If it happened after March 15, 1976,
beyond the expiration date of Travelers' policy, Doolings
would have no right to recover against Travelers or Streeter
Brothers unless Doolings were prepared to prove some agreement
with them outside the insurance policy and outside the written
binder. In that case, the action should have been for reformation,
and breach of the reformed contract, rather than for negligence
in failing to issue a copy of the insurance contract. Although
the District Court extended the opportunity to the Doolings,
they did not show or offer to show that a genuine issue of
material fact existed which hinged on the nondelivery of a
copy of the insurance policy. Rule 56, Mont.R.Civ.P., contemplates
only issues of material fact. If the fact issue is not material
to the claim or defense, the District Court has no authority
under the rule but to order summary judgment as a matter of law.
If the casualty to the log structure occurred before
March 16, 1976, a different situation would obtain. Coverage
under the policy might possibly exist. It was for this reason
that the District Court strove to ascertain from Doolings when
the damage happened, or whether Doolings intended to prove the
insurance contract was open-ended as to time. Although Doolings
stated they intended to prove open-endedness, they put forth no
showing, by testimony, discovery, or otherwise, that a material
fact issue existed on this point. It was incumbent upon them to
do so. The District Court had little choice but to hold against
the Doolings on this contention.
Finally, the Doolings claimed Travelers was negligent in
issuing the policy after the casualty occurred. This claim is
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also without merit. The policy issued conforms to the contract
it was extended to cover, regardless of its issue date.
While the initial burden of proof upon a motion for
summary judgment attaches to the movant, that burden shifts
where the record discloses no genuine issue of material fact.
Under these circumstances, the party opposing the motion must
present facts in proper form raising the issue, see National
Gypsum Co. v. Johnson (1979), Mont . , 595 P.2d 1188,
36 St.Rep. 1033; Harland v. Anderson (1976), 169 Mont. 447,
451, 548 P.2d 613, 615.
A District Court is under no duty to anticipate later proof
to establish a genuine issue of material fact. Taylor v.
Anaconda Federal Credit Union (1976), 170 Mont. 51, 550
P.2d 151.
Streeter Brothers and Travelers were entitled to judgment
as a matter of law, and the District Court properly granted
their respective motions for summary judgment.
Plaintiffs' cause of action remains for decision as to
the defendant Perry. The judgment as to Streeter Brothers
and Travelers is final and properly appealable, since the
District Court directed entry of final judgment for them
under Rule 54(b), M0nt.R.Civ.P.
Affirmed.
Justice
We Concur:
Chief Justice
L' I
Justices
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