State Ex Rel. Park County v. Montan

IN THE SUPREME COURT OF THE STATE OF MONTANA
No. 92-246
STATE ex rel. PARK COUNTY,
Relator,
ORDER
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COURT, PARK COUNTY, THE HONORABLE jp ,ji, jj _,:, y i ,:,,
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BYRON L. ROBB, Presiding Judge,
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This Court on May 28, 1992, in response to an application for
writs, ordered the respondent/plaintiff (Kenneys), to respond to
the application within a determined time period and further ordered
that the preliminary and permanent injunctions enjoining Park
County from interfering with Kenneys' removal and disposal of
sludge and debris temporarily be vacated and stayed. Kenneys
having now filed its response and brief the matter is ripe for
decision. We dissolve the injunctions.
Park County has filed herein an application for a writ of
supervisory control and other appropriate writs of relief.
However, we will treat the application as an appeal. Under Rule
1 (b) (2) , M.R.App.P., a party may appeal from a judgment or order
granting or dissolving an injunction, or refusing to grant or
dissolve an injunction. We will not consider whether the facts set
forth meet the criteria for our consideration and exercise of
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jurisdiction over an application for writ of supervisory control.
In 1991 Park County (County) entered into a contract with
Kenneys, which called for repairs and renovations to the Waste
Water Treatment Plant in Gardiner, Montana, including the
installation of an impermeable liner under two large settling
ponds. As part of the repair process, Kenneys was to remove and
dispose of the sludge which had settled to the bottom of each pond.
In the contract there was a base amount for the removal of 60 cubic
yards of sludge based on an estimated quantity of sludge in the
ponds. This estimate was prepared by H.K.M. Associates
Engineers/Planners, the engineering firm retained by the County.
Also in the contract was a requirement that a unit price be
submitted for each additional cubic yard over and above the 60
cubic yards of sludge which might be removed. Kenneys proceeded to
remove the sludge from the first of the two ponds. Thereafter it
submitted a claim for $120,000, alleging that it had removed at the
very least 2400 cubic yards of sludge based on a percentage of
solid content. Kenneys further asserted a right to $240,000 for
4800 cubic yards of sludge based on a different percentage of solid
content. The County objected to this claim and has not paid the
same.
On March 19, 1992, the County ordered deletion from the
contract the sludge removal on the second aeration pond which it
argued was permissible under the construction contract. Previous
to the deletion, on February 25, 1992, Kenneys filed suit in the
District Court of the Sixth Judicial District for breach of
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contract, claiming nearly $200,000 in damages for payment allegedly
due for work on the first pond. As part of that lawsuit, on April
29, 1992, the District Court granted a preliminary injunction and
ordered that the County was enjoined from interfering with Kenneys'
performance of the sludge removal work on the second aeration pond.
Subsequently, both parties filed motions, including motions to
dissolve, and motions for contempt. A hearing was set on the
motions for May 11, 1992. On May 6, 1992, Kenneys filed a motion
for summary judgment contending that the County's deletion order
constituted a breach of contract. On May 7, 1992, Kenneys filed a
second motion for summary judgment asking the court to convert the
preliminary injunction into a final injunction. On May 8, 1992,
the County telefaxed to Kenneys' counsel a formal objection to the
hearing on the motions for summary judgment and especially declined
to waive the County's right to the ten day notice period on these
motions. The County's formal objection to the early hearing on
Kenneys' motion for summary judgment was hand delivered to the
court on May 11, 1992. The District Court overruled the County's
objections to the hearing on the summary judgment motions.
Following oral argument, the District Court denied Kenneys' motion
for contempt, and denied Kenneys' motion for summary judgment on
the contract. Further, the District Court denied the County's
motion to dissolve or modify the injunction, and denied the
County's motion for summary judgment relative to Kenneys' claim for
injunctive relief. However, the District Court granted Kenneys'
motion for summary judgment requesting the County be permanently
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enjoined from interfering with Kenneys' performance of the sludge
removal contract. The oral ruling was reduced to writing on May
12, 1992 and this application followed.
Our scope of review relative to the issue of whether or not
injunctive relief was improper, is to determine whether the
District Court's determination as to the law is correct. See
Steer, Inc. v. Dept. of Revenue (1990), 245 Mont. 470, 803 P.2d
601.
Section 27-19-103(5), MCA (1991), provides as follows:
An injunction cannot be granted:
. . .
(5) to prevent the breach of a contract the
performance of which would not be specifically enforced:
. . .
Generally construction contracts cannot be specifically enforced
because performance would constitute a personal service
approximating involuntary servitude. Further, money damages
provide an adequate legal remedy. One of the most common
applications of this rule is found in cases involving building and
construction contracts. These contracts will not be specifically
enforced, partly because damages at law are an adequate remedy, and
partly because of the incapacity of the court to superintend their
performance. See 71 Am.Jur.2d, Specific Performance 5 165 (1973).
Here, Kenneys have an adequate remedy at law for damages under
the contract. As to this contract, it can be readily envisioned,
that questions will arise and be presented to both the District
Court and to this Court, as they have in the past, which will put
the court system in the position of superintending the performance
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of a contract. As stated above, this is one of the major reasons
why the performance of this contract should not be specifically
enforced.
Kenneys argue that injunctive relief is appropriate because
section 6.29 of the contract creates an obligation of specific
performance on the part of the contractor. If the contract is
found to require specific performance, then the remedy of specific
performance is made reciprocal by operation of law. See § 27-1-
414, MCA. Section 6.29 of the contract provides as follows:
CONTRACTOR shall carry on the work and adhere to the
progress scheduled during all disputes or disagreements
with owner. No work shall be delayed or postponed
pending resolution of any disputes or disagreements,
except as permitted by paragraph 15.5 [termination] or as
CONTRACTOR and OWNER may otherwise agree in writing.
However, section 6.29 is a contractual obligation which informs the
contractor that he is expected to continue his work even though
there might be disputes or disagreements with the owner. This does
not mandate specific performance. A contractor would still be free
to breach the contract and then be liable for money damages by
reason of that breach.
The District Court granted summary judgment in favor of
Kenneys. By granting Kenneys' motion for summary judgment and
permanently enjoining the County, the court determined that any
deletion of the sludge removal portion of the project would be a
breach of the contract, and made a determination whether the County
had a basis to delete the work. However, the County was not given
the ten days notice required under Rule 56(c), M.R.Civ.P., from the
time of service of the motion for summary judgment to the time
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fixed for the hearing. The County made proper objections as
required by Rule 56(c), M.R.Civ.P., and the County did not waive
the requirement of ten days notice under Rule 56(c). Therefore,
the District Court was without authority to grant Kenneys' motion
for summary judgment. The injunctions are vacated and dissolved
and the order of summary judgment is set aside and the cause is
remanded to the Distri$t Court for further proceedings.
DATED this sO'%ay of June, 1992.
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June 30, 1992
CERTIFICATE OF SERVICE
I hereby certify that the following order was sent by United States mail, prepaid, to the
following named:
L. B. Cozzensand Neil G. Westesen
Crowley, Haughey, Hanson, Toole & Dietrich
P. 0. Box 2529
Billings, MT 59103-2529
Lawrence R. Martin and Randall G. Nelson
Felt, Martin, Frazier & Lovas
P. 0. Box 2558
Billings, MT 59103-2558
ED SMITH
CLERK OF THE SUPREME COURT