author: JUSTICE SHEEHY

text:
    In re the MARRIAGE OF LANA JEAN GALLANT, Petitioner and Respondent, and HARRY GALLANT, Respondent and Appellant.
    No. 89-216.
    Submitted on Briefs Dec. 1, 1989.
    Decided Feb. 15, 1990.
    786 P.2d 1193.
    Mark A. Vucurovich, Henningsen, Purcell, Vucurovich & Richardson, Butte, for respondent and appellant.
    J. Mark Stahly, Jackson, Murdo & Grant, Helena, for petitioner and respondent.
   JUSTICE SHEEHY

delivered the Opinion of the Court.

Harry Gallant appeals from a judgment of the District Court, Eighth Judicial District, Cascade County, finding him liable for $6,367.38 in child support arrearages, medical expenses and attorney fees. We affirm the District Court.

The sole issue presented is whether the court erred in finding the father liable for $4,050 in child support arrearages.

Harry and Lana Jean Gallant were divorced in September, 1980. Lana Jean Gallant was awarded custody of the minor child, and Harry was required to pay all reasonable medical, optical and dental bills incurred on behalf of the child, as well as $75 per month in child support. The court recognized the father’s disability as a result of an industrial accident, and allowed him to forego payment until he received his disability benefits.

The father began receiving $1,000 per month in Workers’ Compensation benefits in the fall of 1981. It is uncontroverted that he helped pay his son’s medical expenses from 1981 to 1985. In 1981 or 1982, father agreed to turn over a trailer to the mother as partial payment of back child support. Mother subsequently sold the trailer for $6,000.

In April, 1985, father began receiving Social Security benefits of $850 per month, as well as union retirement benefits of $330 per month, making his total monthly income approximately $1,180. In addition, he received a lump sum payment of past Social Security benefits totaling $36,000.00.

Father made no child support payments, and no medical payments from 1986 on, despite requests from the mother. Subsequently, mother retained counsel and filed a motion for order to show cause why contempt should not issue for the father’s failure to pay child support and reasonable medical bills. Hearing on the matter took place on November 17,1987, and judgment and order issued on February 21, 1989. The District Court found that the father was 86 months behind in child support, amounting to $6,450. The court credited him with $2,400, the amount the mother testified she had netted on the sale of the mobile trailer. The court found the father also owed $1,238.09 in medical expenses. The court noted that the parties’ child had been receiving $325 per month in Social Security benefits since 1985, but declined to discharge the child support obligation in light of those benefits. This appeal ensued. Appellant appeals only the child support ruling.

The father contends that the District Court erred in finding he owes child support arrearages. Father argues that he has substantially complied with the decree’s child support obligations by turning the house trailer over to his ex-wife, and by obtaining Social Security payments for the child.

The mother testified that she received $2,400 from the sale of the trailer after costs were deducted. This testimony is unrefuted. The court took into consideration statements by both parties that the transfer of the property was in lieu of child support payments. The court then subtracted $2,400 from its calculation of arrearages:

86 months at $75/month $6,450.00
Less: Credit from transfer of property $2,400.00
$4,050.00

Father has raised no objection to the $2,400 figure offered by the wife. Rather, he asserts that the parties agreed that the transfer would absolve husband of all arrearages. The District Court properly disregarded the claim, as such modification requires the written consent of the parties. Section 40-4-208(2)(b)(ii), MCA. Thus, after crediting father for $2,400, the court properly adjudged the remaining $4,050 due and owing.

Father also contends that his obtaining of Social Security payments for the child serves as substantial compliance with the support obligation. He states that the parties agreed at the decree’s inception to terminate child support upon obtainment of Social Security benefits. No such provision is contained with the parties’ dissolution decree.

The father’s claim of substantial compliance with the child support order does not meet the standard of “substantial compliance” set forth in In Re the Marriage of Sabo (1986), 224 Mont. 252, 256, 730 P.2d 1112, 1114 and Williams v. Budke (1980), 186 Mont. 71, 74-5, 606 P.2d 515, 517. The surrender of the trailer here accounted for only one-third of the outstanding child support debt. Further, the attainment of Social Security benefits for the child is not an “expenditure [by the father] which constitutes substantial compliance with the spirit and intent of the decree.” In Re Marriage of Cook (1986), 223 Mont. 293, 299, 725 P.2d 562, 566. Such benefits in no way constitute an expenditure from the father. The father has neither shown nor pleaded substantial and continued changed circumstances that would serve to allow modification. Section 40-4-208(2) (b)(i), MCA. Conversely, the mother has shown actual need for the support. The parties’ child has accrued substantial medical bills due to his physical disability. This Court is reticent because of statutory limitation to relieve an obligor parent of past due child support obligations. State ex. rel Blakeslee v. Horton (1986), 222 Mont. 351, 722 P.2d 1148 1150-51; Sabo, supra.

We affirm the District Court.

CHIEF JUSTICE TURNAGE and JUSTICES BARZ, McDON-OUGH and WEBER concur.


source: Caselaw Access Project

author: JUSTICE WEBER

license: Public Domain

text:
    FEDERAL SAVINGS AND LOAN INSURANCE CORPORATION, Receiver for the Montana Federal Savings Bank, f/k/a Montana Savings and Loan Association, Plaintiff and Respondent, v. DARWIN HAMILTON, Mary Hamilton, et al., Defendants and Appellants.
    No. 89-348.
    Submitted On Briefs Dec. 14, 1989.
    Decided Feb. 15, 1989.
    786 P.2d 1190.
    Patrick M. Springer, Kalispell, for defendants and appellants.

      Debra D. Parker, Murphy, Robinson, Heckathorn & Phillips, Kalispell, for plaintiff and respondent.
   JUSTICE WEBER

delivered the Opinion of the Court.

This appeal arises from an order by the District Court, Eleventh Judicial District, Flathead County, Montana, granting summary judgment in favor of plaintiff. Defendant appeals. We affirm.

The issues presented for our review are:

1. Did the Hamiltons present a timely appeal of the amended summary judgment?

2. Whether this case should be remanded for a determination of the adequacy of the sales price of land sold at a sheriff’s sale.

Mr. and Mrs. Darwin Hamilton purchased property near Kalispell, Montana, in 1982, for development as a mobile home subdivision. The Hamiltons entered an agreement with the owners of the land, Mr. and Mrs. Long, to purchase the property for $250,000. The Longs took a mortgage on the land at this time.

That same year Mr. Hamilton borrowed $175,000 from Montana Savings and Loan Association for development costs. To secure this loan he executed a promissory note on March 16, 1982, and the Association also took a mortgage on the land. This promissory note stated that the note would come due on May 16, 1985. A year later, Mr. Hamilton borrowed an additional $44,000 from Montana Savings and Loan Association, which was used to purchase an additional seven acres adjoining the original property. He executed a promissory note for this amount, due May 16, 1985. At the same time he executed a deed of trust to the Association, naming it as beneficiary. On July 29, 1983, Mr. Hamilton executed a mortgage modification agreement and a promissory note for the additional amount of $144,000. Under this agreement, all three obligations were consolidated into an indebtedness in the amount of $359,000, secured by the mortgage. This agreement stated a due date of August 1, 1984, with a possible twelve month extension under certain conditions. The Hamiltons gave personal guarantees of each promissory note. The mortgage modification also contained an agreement whereby the Longs subordinated their interest in the property to the Association.

Mr. Hamilton began subdividing the property into mobile home lots, calling the subdivision “Green Tree Meadows.” Seventeen of these lots were sold to individual parties; however, the development of the subdivision was not completed by the end of 1985, and the Hamiltons had not satisfied their obligations with the Bank.

Montana Savings and Loan Association became Montana Federal Savings Bank. On August 14, 1985, the Federal Savings and Loan Insurance Corporation (FSLIC) was appointed receiver for Montana Federal Savings Bank. On August 16, 1985, the receiver closed the Savings Bank and began liquidating the assets. On August 28, 1986 FSLIC filed a complaint to foreclose against Darwin and Mary Hamilton, alleging that they were in default under the terms of the three promissory notes, the Mortgage, the Deed of Trust, and the Mortgage Modification Agreement. The complaint stated a total amount owing, including principal and interest through June 30, 1986, of $429,557. The Hamiltons did not dispute that they were in default under the terms of the notes.

FSLIC moved for summary judgment on the issue of default, and moved for a deficiency judgment. On March 21,1989, in an amended order granting summary judgment, the court awarded FSLIC a decree of foreclosure, and a judgment against Darwin and Mary Hamilton, jointly and severally, in the amount of $564,600 (which sum included interest through February 15, 1989). The order also stated:

“In the event the proceeds of the sale are insufficient to pay the amounts due the Plaintiff, together with interest, costs and attorneys’ fees, the Plaintiff shall have a deficiency judgment against the Defendants Darwin Hamilton and Mary Hamilton, jointly and severally, and shall have execution thereon.”

On April 24,1989, the sheriff of Flathead County held a public sale of the property. FSLIC, the only bidder at the sale, purchased the property for $475,000. On May 16, 1989, a deficiency judgment was granted to FSLIC against the Hamiltons in the amount of $99,306. Notice of entry of deficiency judgment was filed on May 19, 1989. The Hamiltons filed this appeal on June 16, 1989.

I

Did the Hamiltons present a timely appeal of the amended summary judgment?

This case involves two final orders. The amended summary judgment was a final order, notice of which was entered March 24, 1989. This order granted FSLIC a deficiency judgment. The entry of a deficiency judgment in the amount of $99,306, was also a final order, notice of which was entered May 19, 1989.

On appeal, Hamiltons contest both the propriety of the deficiency judgment and the amount of the deficiency judgment. The amount of the judgment will be discussed in Issue II.

In contesting the propriety of the deficiency judgment, the Hamiltons are appealing the validity of the amended summary judgment. Pursuant to Rule 5, M.R.App.P., the Hamiltons had thirty days from the date of entry of judgment, which was March 24, 1989, in which to appeal this order. This appeal was filed June 16, 1989. We hold that the appeal of this issue was not timely and will not be discussed.

II

Whether this case should be remanded for a determination of the adequacy of the sales price of land sold at a sheriffs sale.

After the sheriff’s sale, FSLIC filed a “Notice of Partial Satisfaction and Motion for Entry of Deficiency Judgment,” requesting that the court grant FSLIC a deficiency judgment against defendants in the amount of $99,306.

On May 16, 1989 the court granted this motion, stating:

“On motion of the Plaintiff, deficiency judgment is hereby granted against the defendants, Darwin Hamilton and Mary Hamilton jointly and severally in the amount of $99,306.00.”

In this issue we discuss only the above-mentioned order, which entered the amount of the deficiency judgment. The Hamiltons object to the amount of this judgment, by urging that the sale price of $475,000, obtained at the sheriff’s sale, was grossly inadequate. They urge that the fair market value of this property upon the completion and sale of each lot, is approximately $1 million. They base this on the fact that 17 of 81 lots have been sold at prices ranging from $11,000 to $13,000. The Hamiltons urge that the present case be remanded to District Court for a determination of the fair market value of the property at the time of sale, relying on the recent case of Trustees of Wash. Idaho Mont. Carpenters Employers Retirement Trust Fund v. Galleria Partnership (Mont. 1989), [239 Mont. 250,] 780 P.2d 608, 46 St.Rep. 1661. In Galleria Partnership a piece of real property was bid in at the sheriff’s sale for approximately 30% of its original appraised value. Although the issue of the adequacy of the sale price had not been raised in the lower court, we remanded to District Court for a determination of fair market value. We remanded “in the exercise of our equity jurisdiction.” Galleria Partnership, 780 P.2d at 617.

In the present case, however, the Hamiltons’ request must fail. First, as FSLIC correctly notes, the Hamiltons did not petition the District Court in regard to the adequacy of the sales price. We acknowledge that an issue not presented to the District Court will not be addressed on appeal. Wyman v. DuBray Land Realty (Mont. 1988), 231 Mont. 294, 752 P.2d 196, 200, 45 St.Rep. 621, 625. In view of Galleria Partnership we will consider this matter in order that litigation will be terminated.

Although several states have statutes requiring that the amount realized at a sheriffs sale must reflect the fair market value of the property, Montana statutes have no such requirement. See Galleria Partnership, 780 P.2d at 616-17. Further, in the present case defendants failed to submit any relevant evidence of fair market value on the date of sale. There is a total absence of facts demonstrating that $475,000 was not a fair price. We note that the face amount of the original obligation was $359,000. The purchase price bid by the receiver in the amount of $475,000 substantially exceeded that of the original obligation, even though it was less than the total judgment of $564,000. We conclude that the Hamiltons have failed to present any evidence requiring an exercise of our equity jurisdiction.

We conclude that Galleria Partnership is distinguishable from the present case. We affirm the District Court’s granting of the deficiency judgment.

Affirmed.

CHIEF JUSTICE TURNAGE and JUSTICES HARRISON, BARZ and McDONOUGH concur.


text:
    In re the MARRIAGE OF ALAN MORRISON HAY, Petitioner and Appellant, and HELEN LOUISE HAY, Respondent and Respondent.
    No. 89-360.
    Submitted on Briefs Jan. 4, 1990.
    Decided Feb. 15, 1990.
    786 P.2d 1195.

      Gregory E. Paskell, Kalispell, for petitioner and appellant.
    M. Dean Jellison, Kalispell, for respondent and respondent.
   JUSTICE WEBER

delivered the Opinion of the Court.

This appeal arises from an order modifying custody by the District Court, Eleventh Judicial District, Flathead County, Montana. Mr. Hay appeals. We affirm.

The sole issue presented for our review is whether the District Court erred in modifying a custody order.

Alan and Helen Hay were married on April 10, 1978. Their daughter, Heather, was born on May 10, 1980. Mr. Hay was manager of Desert Mountain Forest Products, Inc. William Hay, the brother of Alan Hay, was owner of Desert Mountain Guest Ranch. As an incident of his employment, Mr. Alan Hay and his family resided at this ranch, which is located near West Glacier, Montana.

In September 1985, Mr. Hay filed for dissolution. A decree of dissolution was entered by default on October 23, 1985. The decree awarded sole custody of Heather to Mr. Hay. On November 6, 1985, Ms. Hay filed a motion to set aside the default. In this motion Ms. Hay alleged that Mr. Hay “lulled” her into allowing the default to be entered, and also that he misrepresented the marital estate. The court held a hearing on this motion on February 28,1986, and determined that Ms. Hay’s allegations were unsubstantiated. Accordingly, the motion to set aside the default was denied. However, the court’s conclusions of law stated, “Custody of the minor child may be reviewed by the court upon a proper application pursuant to sec. 40-4-219 et seq.” The court issued its order denying the motion on January 12, 1987.

After the dissolution, Ms. Hay continued to reside at the ranch. Initially, Mr. Hay agreed that Ms. Hay could live at the ranch while she became recertified as a hairdresser. After obtaining recertification, Mr. Hay requested that Ms. Hay vacate the premises. However, Ms. Hay refused to move. Because Mr. and Ms. Hay continued to reside in the same residence after the dissolution, their relations became very strained, occasionally resulting in physical violence. On one occasion law enforcement was called to intervene. The child, Heather, witnessed these altercations.

On February 2, 1987, Ms. Hay filed a motion to modify the decree, by changing the custody arrangement to joint custody. In an affidavit in support of the motion, filed pursuant to sec. 40-4-220, MCA, Ms. Hay alleged that she had been primary caretaker of Heather since the dissolution, and that severe tension existed under the present circumstances which had an adverse psychological impact on the child. Mr. Hay filed an affidavit in opposition to the motion. The District Court found that the affidavits presented facts demonstrating a possibility that the child’s environment seriously endangered her mental or emotional health. It therefore ordered a hearing on the matter.

A hearing was held on April 14, 1987. At this hearing both parents testified, as well as the deputy sheriff for Flathead County. The court interviewed Heather privately. All parties confirmed the tension and physical violence which had erupted as a result of the living arrangement. After this hearing, on May 26, 1987, the court entered findings of fact and conclusions of law, noting the severe family problems, including physical violence. The court ordered Ms. Hay to vacate the ranch and establish her own residence. It determined that custody of Heather should remain with Mr. Hay, subject to liberal visitation by Ms. Hay, pending a final hearing on the merits. The court also ordered Family Court Services to counsel both parties and prepare a report for the court. Additionally, the court stated that all other matters would be held in abeyance pending a final hearing and order.

On October 19, 1988, the court held a final hearing on the motion to modify custody. At this hearing testimony was taken from Mr. and Ms. Hay, several friends and relatives, and again the court interviewed Heather privately. At this time the court also had for its consideration reports from Family Court Services.

On March 6,1989, the District Court issued its final order, modifying the custody to joint custody, with Ms. Hay as residential parent, allowing liberal visitation to Mr. Hay. The court determined that both Mr. and Ms. Hay were suitable parents, and that during the two years in which the proceeding had been in progress the child had resided with her father, yet expressed a strong desire to live with her mother. The court determined that Ms. Hay had established a comfortable, neat home and that joint custody would be in Heather’s best interest. Mr. Hay contends that the court erred in making this modification of custody.

The statute governing modification of custody, sec. 40-4-219, MCA, provides in pertinent part:

“Modification. (1) The court may in its discretion modify a prior custody decree if it finds, upon the basis of facts that have arisen since the prior decree or that were unknown to the court at the time of entry of the prior decree, that a change has occurred in the circumstances of the child or his custodian and that the modification is necessary to serve the best interest of the child and if it further finds that:
“(c) the child’s present environment endangers seriously his physical, mental, moral, or emotional health and the harm likely to be caused by a change of environment is outweighed by its advantages to him[.]”

According to this statute, prior to modifying custody, the court must find that “a change has occurred in the circumstances of the child, that the modification is in the best interests of the child, and that the requirement of one of the subsections is satisfied.” Marriage of Anderson (Mont. 1989), [240 Mont. 316,] 783 P.2d 1372, 1373, 46 St.Rep. 2155, 2157. In the present case the District Court determined that subsection (c) was satisfied, in that the child’s present environment seriously endangered her mental and emotional health, and that the advantages of a change of environment outweighed the harm.

Mr. Hay contends that the District Court misapplied the statutory requirement of “serious endangerment.” He contends that Ms. Hay created the environment which seriously endangered her daughter’s welfare, by her refusal to vacate the ranch. He contends that Ms. Hay cannot premise the need for a change in custody based on a dangerous environment which she has created.

In addressing this contention, we first note that although the District Court determined that the residential arrangement, wherein Mr. and Ms. Hay continued to live together after the divorce, was the cause of the tense environment, the court did not place the “blame” for this situation on either party. Further, the statute itself is neutral as to the cause of the detrimental environment. We conclude that the District Court did not misapply the finding of serious endangerment.

Mr. Hay further contends that the District Court failed to make a finding of changed circumstances, as required by the statute. Mr. Hay relies on In Re Custody of Andre (Mont. 1988), [234 Mont. 80,] 761 P.2d 809, 45 St.Rep. 1745, for the holding that a finding of changed circumstances must be made by the court. In the case of In Re Custody of Andre the child had resided with the mother for nine years. On a motion to modify custody the District Court awarded custody to the father. We remanded for a determination of whether a change of circumstances had occurred, or whether an exception existed whereby a change of circumstances need not be shown. In re Custody of Andre, 761 P.2d at 812. This Court noted the purpose of the changed circumstances rule, quoting Burchard v. Garay (1986), 42 Cal.3d 531, 229 Cal.Rptr. 800, 724 P.2d 486, as follows:

“The changed-circumstances rule is not a different test, devised to supplant the statutory test, but an adjunct to the best-interest test. It provides, in essence, that once it has been established that a particular custodial arrangement is in the best interests of the child, the court need not reexamine that question. Instead, it should preserve the established mode of custody unless some significant change in circumstances indicates that a different arrangement would be in the child’s best interest. The rule thus fosters the dual goals of judicial economy and protecting stable custody arrangements.” (Citations omitted.)

In re Custody of Andre, 761 P.2d at 811.

The requirement of changed circumstances applies even where the initial custody determination was made by a default decree, as it was in this case. “Whether the order respecting custody has been granted after a full adversary proceeding or after a default divorce, as in this case, the considerations are the same.” Svennungsen v. Svennungsen (1974), 165 Mont. 161, 166, 527 P.2d 640, 643. However, in Svennungsen we also stated:

“We do not want to be understood as implying that a substantial change in circumstances would be required as a threshold finding in every factual situation before the issue of custody could be litigated on a petition to modify custody. Although the case is not before us, we would be receptive to the proposition that a showing of unfitness on the part of the person having custody, or some other justifiable grounds, might suffice and, despite a failure to show a substantial change of circumstances, enable the district court to consider the issue of custody on a petition to modify custody.”

Svennungsen, 527 P.2d at 643.

From our review of the record it is clear that the severe tension and hostility between Mr. and Ms. Hay arose after the dissolution, and was not contemplated by the parties or by the court at the time the decree was entered. The strained relations between Mr. and Ms. Hay constituted changed circumstances. Thus Mr. Hay’s contention that there were no changed circumstances fails factually.

In this case the District Court very carefully and extensively considered the motion to modify custody. It held two separate hearings on the matter, and considered reports by Family Court Services. We conclude that the District Court properly applied the statutory factors to the facts of this case. We affirm the District Court in its modification of the custody arrangement to joint custody.

CHIEF JUSTICE TURNAGE and JUSTICES HARRISON, HUNT and McDONOUGH concur.