Justia Real Estate & Property Law Opinion Summaries

The case revolves around a dispute between Debra and Sidney Schutter (the Schutters) and the State of Montana Board of Land Commissioners (the Board) over the ownership of a water right, identified as Claim 13169. The Schutters use a groundwater well on their private property to irrigate four parcels of land, one of which is school trust land owned by the State of Montana. The Board objected to the Schutters' claim of exclusive ownership of the water right, asserting that the State holds an ownership interest in the portion of the water right used to irrigate the school trust land.The Montana Water Court granted summary judgment to the Board, adding the State as a co-owner of Claim 13169, but only for the portion of the claim appropriated to irrigate the school trust land. The Schutters appealed this decision, arguing that the Water Court erred in applying the precedent set in a previous case, Pettibone, and that no portion of Claim 13169 is appurtenant to the school trust land.The Supreme Court of the State of Montana affirmed the Water Court's decision. The court held that the portion of Claim 13169 used to irrigate the school trust land is appurtenant to that land and, therefore, the State is a co-owner of that portion of the right. The court also rejected the Schutters' argument that the Water Court erred in applying the Pettibone precedent, stating that the Schutters' reliance on the point of diversion as singularly controlling was misplaced. The court concluded that the Schutters used the school trust land they leased to qualify for and establish the parameters of Claim 13169, and without the ability to claim a beneficial use on the school trust land, the Schutters' claim to a water right would have been different, perhaps smaller. View "Schutter v. Board of Land Commissioners" on Justia Law

Phoenix Capital Group Holdings, LLC, an oil and gas mineral rights investment firm, acquired mineral interests on two sections of real property in Richland County, Montana. The previous owner, Katherine Solis, had been approached multiple times by Kraken Oil and Gas LLC, an energy production company, to secure a lease of the mineral interests or to participate in drilling wells. Solis consistently refused to engage with Kraken. After Phoenix acquired the mineral interests, it expressed a desire to participate in the oil and gas production from the wells being drilled by Kraken. However, Kraken responded that the mineral interests had been deemed “non-consent” due to Solis’s lack of participation, and it was authorized to recover risk penalties.The Board of Oil and Gas Conservation of the State of Montana held a hearing and determined that Kraken had made unsuccessful, good faith attempts to acquire voluntary pooling in the spacing unit, and that Phoenix, as a successor in interest, was bound to Solis’s decision not to participate. The Board therefore determined that the mineral interests owned by Phoenix would be subject to forced pooling and that Kraken could recover risk penalties from Phoenix. Phoenix requested a rehearing from the Board, but that request was denied. Phoenix then filed a Complaint seeking injunctive relief from the Board decision in the Thirteenth Judicial District Court, Yellowstone County. The District Court issued an Order granting Kraken and the Board’s motions for summary judgment, and dismissing Phoenix’s Complaint.In the Supreme Court of the State of Montana, Phoenix appealed the District Court's decision. The Supreme Court affirmed the lower court's decision, holding that the Board correctly interpreted the statutory force-pooling requirements, and that its decision to force pool Phoenix’s mineral interests was reasonable. The court also held that Kraken’s letters to Solis constituted written demands that gave Solis the option to either participate or face assessment of risk penalties. The court concluded that risk penalties were imposed, not pursuant to the presumption in § 82-11-202(3), MCA (2021), but under § 82-11-202(2), MCA, which requires an owner pay risk penalties when “after written demand, [the owner] has failed or refused to pay the owner’s share of the costs of development or other operations . . . .” View "Phoenix Capital v. Board of Oil & Gas" on Justia Law

This case involves a dispute between members of Black Gold Enterprises, LLC, a company formed in 2013, including plaintiff Adam Pummill, plaintiff Kurtis Robertson, and defendant Joshua T. Patterson. The source of the dispute was the payment of rent from Patterson's businesses to Black Gold for the use of a property. Patterson eventually stopped paying rent, leading to the involvement of a receiver, James Galipeau, to manage the property.The Supreme Court of the State of Montana considered the appeal by Patterson against the award of fees to the receiver and his attorney from interplead funds held by the Clerk of Court, arguing that the District Court abused its discretion. Patterson also contested the District Court's decision that the lien on the property, arising from a loan agreement between Patterson's business and Black Gold, was invalid.The Supreme Court, applying the Hickey factors to assess the reasonableness of the receiver's fees, found no abuse of discretion by the District Court. The court concluded that the receiver's work in the complex, time-consuming case was essential, and the sale of the property (Black Gold's only asset) was reasonably executed. The court also found that the District Court had the inherent power to distribute interplead funds for services related to the receivership, rejecting Patterson's claim that the dispersal should have waited until a final disposition.Thus, the Supreme Court affirmed the District Court's decisions regarding the award of the receiver and attorney fees and the method of their payment. The court did not address the issue of the validity of the lien on the property. View "Pummill v. Patterson" on Justia Law

The Supreme Court of the State of Montana affirmed a lower court's decision that an insurance agency, Rames Inc., formerly known as Central Insurance Agency, had a duty to procure additional insurance coverage for a construction company, TCF Enterprises Inc., also known as Malmquist Construction. Rames was found to have breached that duty, thereby breaching the standard of care and negligently misrepresenting that it had obtained the coverage. The court also found that the policy's professional services exclusion would not have barred coverage for defense and indemnity. The dispute arose after Malmquist was sued by a developer due to a construction defect and realized it wasn't covered as an additional insured under a subcontractor's insurance policy as it had believed. Rames had been told by the subcontractor to add Malmquist as an additional insured, but it failed to do so. The jury awarded damages to Malmquist in the amount of $1,022,257.85. Rames appealed, but the Supreme Court upheld the lower court's decision. View "TCF Enterprises, Inc. v. Rames, Inc." on Justia Law

In a dispute arising from a failed subdivision in Missoula County, Montana, a group of property purchasers, led by Gilbert and Judith Johnston, claimed that Flying S Title and Escrow, Inc., breached a purported contract to provide title insurance for the properties they bought. The properties were originally platted as lots, but the purchasers believed that they would eventually be reconfigured into larger parcels. However, the necessary infrastructure was not installed and the amended plat was never recorded, so the parcels never came into existence. The purchasers claimed that pro forma documents provided by Flying S constituted a contract to insure the parcels. The Supreme Court of Montana disagreed, ruling that the pro forma documents did not constitute a contract, but were merely an offer to issue a title insurance policy for the parcels, subject to the terms stated in the documents. The court noted that a contract for title insurance could not exist under the pro forma documents because the parcels, and the title thereto, never existed. Furthermore, the court found that Flying S had not been unjustly enriched by the purchasers' premium payments because it had provided, as agreed, title insurance for the transaction completed by the purchasers to buy the lots. Therefore, the court affirmed the lower court's decision in favor of Flying S Title and Escrow, Inc. View "Johnston v. Flying S Title & Escrow, Inc." on Justia Law

In this case, the Supreme Court of the State of Montana addressed a dispute over a settlement agreement regarding the sale of a house and the subsequent release of construction-related claims. Daniel Perl and Sandra Perl (collectively, "the Perls"), who are the plaintiffs and appellants, entered into discussions with Christopher Grant and other related parties (collectively, "the Grants"), who are the defendants and appellees. The Perls had purchased a home from the Grants and later became dissatisfied with the construction quality. After negotiations, the parties, through text messages, appeared to reach an agreement wherein the Grants would buy back the property for $2.8 million, and the Perls would release all claims related to the house's construction. However, the Perls later objected to several terms in the formal documents prepared by the Grants' attorney and disputed the existence of an enforceable settlement agreement.The lower court, the Eleventh Judicial District Court, Flathead County, granted the Grants' motion for summary judgment and denied the Perls' cross-motion for partial summary judgment. The lower court held that there was indeed an enforceable settlement agreement.The Supreme Court of the State of Montana affirmed the lower court's decision. The Supreme Court found that the parties' text messages satisfied the statute of frauds and constituted an enforceable settlement agreement. The court pointed out that the text messages contained all the essential elements of a contract, including the parties, the subject matter, a reasonably certain description of the property, the purchase price, and mutual assent. The court also found that the Perls' objections to non-material terms in the formal documents did not invalidate the settlement agreement. Therefore, the Supreme Court affirmed the lower court's decision to grant the Grants' motion for summary judgment and deny the Perls' cross-motion for partial summary judgment. View "Perl v. Grant" on Justia Law

This case is an appeal from a District Court order enforcing a Water Court decree related to water rights in Big Warm Creek, in Phillips County. Little Big Warm Ranch, LLC (LBWR) argued against the enforcement order and Wilfred Doll cross-appealed a ruling denying attorney fees. The parties have a complex history related to land sales and shared water rights with the same priority date. The water rights in question were co-equal in priority, meaning neither party could "call" on the other to decrease their water usage during times of low flow.The District Court allocated the parties' rights on a percent basis, which LBWR argued was erroneous. LBWR also contended that Doll should not be allowed to leave water instream at the Ester Headgate (a point of diversion). Doll, on the other hand, contended that he was entitled to attorney fees.The Supreme Court of Montana affirmed the District Court's decision. The Court found that the District Court correctly allocated the parties' rights on a percent basis and that it was correct in determining that Doll may leave water instream at the Ester Headgate. The Court also affirmed the District Court's refusal to award Doll attorney fees, reasoning that there was no prevailing party in the underlying dispute. View "Little Big Warm v. Doll" on Justia Law

The case involves an appeal by William Russell and Mountain View Investments, LLC, (MVI) against a judgment from the Eleventh Judicial District Court, Flathead County, in favor of 360 Reclaim, LLC. The dispute revolves around a twenty-acre parcel of land in Montana which was purchased by Russell in 2010 and later foreclosed due to defaulted loan payments. 360 Reclaim purchased the property at a sheriff’s sale and then started charging Russell for storage and cleanup of items left on the property. Russell attempted to redeem the property within the one-year redemption period, but his payment was rejected as insufficient by 360 Reclaim, which calculated a higher redemption amount that included cleanup costs. The District Court determined that 360 Reclaim was entitled to include cleanup costs as maintenance expenses, rendering Russell's redemption invalid.However, on appeal, the Supreme Court of Montana held that "maintenance expenses," as used in the redemption statute, do not include cleanup costs for the removal of a redemptioner’s personal property. The court found that 360 Reclaim took a calculated risk in purchasing the property at a foreclosure sale, knowing its condition and the presence of Russell's personal property. The court reversed the judgment of the District Court and remanded the case for further findings and conclusions consistent with this decision. The lower court was directed to determine what credits, if any, Russell and MVI are entitled to against the redemption price and whether Russell’s offer of redemption was in substantial compliance with the redemption statutes. View "360 Reclaim v. Russell" on Justia Law

The Supreme Court affirmed the judgment entered by the district court following a jury verdict in favor of Plaintiff on his nuisance claim against Glacier Electric Co-op, Inc., holding that the district court did not err by instructing the jury that damages could be awarded for nuisance.Plaintiff sued Glacier for damages caused by the flooding of his property, and the case proceeded to a jury trial on both nuisance and negligence claims. The jury returned a verdict in favor of Plaintiff, finding that Glacier's paving of an alleyway between the properties constituted a nuisance that damaged his property, and awarded $250,000 in damages on the nuisance claim. The Supreme Court affirmed, holding that the jury instructions in this case did not constitute reversible error. View "Winkowitsch v. Glacier Electric Cooperative, Inc." on Justia Law

The Supreme Court affirmed in part and reversed in part the judgment of the district court granting prescriptive easements over two roadways to Defendants, concluding that remand was required with instructions to conform the findings of fact, conclusions of law, and judgment to reflect the Court's holding in this case.Specifically, the Supreme Court held (1) the district court erred by concluding that Defendants acquired a prescriptive easement over Quarter Gulch Road; (2) the district court correctly concluded that the prescriptive easement over Olson Road was appurtenant; and (3) remand was required to reflect this Court's holding that the Defendants' prescriptive easement over Olson Road was limited in scope to the historic agricultural, recreational, and residential uses of the road by Defendants and their predecessors between approximately 1948 and 1997. View "Faber v. Raty" on Justia Law