Ming Da Situ v. Smole
2013 MT 33
Mont.2013Background
- On Oct. 14, 1989 Situs acquired restaurant assets and entered a lease of Murphy’s real property with a 10-year term ending Oct. 3, 1999.
- The Lease granted Situs an option to purchase the land at the October 1999 expiration, with a process to determine fair value via independent appraisers if needed.
- Situs paid $175 monthly rent under the Lease; in 2000 Murphy allegedly agreed to appoint an appraiser but never did.
- Murphy later increased rent to $650/month in 2008; Situs paid $175 until March 2009 and then continued holdover occupancy after notice of tenancy termination on Mar. 31, 2009.
- Situs filed suit Aug. 17, 2009 seeking declaratory judgment, appraiser selection, and damages; Murphy counterclaimed for unlawful detainer, which the District Court later resolved in Murphy’s favor with rent and trebled damages.
- On appeal, Situs challenges the district court’s statute-of-limitations dismissal as well as whether the court properly treated the motion to dismiss under Rule 12(b)(6).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the district court properly dismissed as time-barred. | Situs argues facts show statute not expired and estoppel applies. | Murphy argues action accrued when option exercised and was time-barred. | Yes; dismissal upheld as time-barred. |
| Whether the district court erred by considering matters outside the pleadings without proper notice. | Situs contends court converted to summary judgment without notice. | Murphy contends footnote reference did not convert the motion. | No; court did not improperly convert or violate notices. |
Key Cases Cited
- Wright v. Brooks, 47 Mont. 99 (Mont. 1913) (specific performance holdover considerations distinguished)
- Nevala v. McKay, 178 Mont. 327 (Mont. 1978) (holdover tenancy and rights under renewal distinctions)
- Miller v. Meredith, 149 Mont. 125 (Mont. 1967) (option to purchase not extended by holdover tenancy)
- Willson v. Terry, 265 Mont. 119 (Mont. 1994) (renewal limitations under §70-26-204, MCA)
- Selley v. Liberty Northwest Ins. Corp., 299 Mont. 127 (Mont. 2000) (equitable estoppel doctrine and when it applies)