*1 AMERICAN MUSIC COMPANY KELMAN,
and ZOLLIE Appellants, Plaintiffs DENNIS L. MAEETTA HIGBEE,
HIGBEE, and HIGBEE,
INC.,
Respondents.
Defendants
No. 97-585.
April
Submitted on Briefs
1998.
Decided June
1998.
See C.J.S. Potts, For Appellants: Steven T. Thompson, Potts, Jacobsen & Great Falls. Respondents: Gregory Davis,
For J. Hatley, Hatley, Haffeman & Tighe, Great Falls.
CHIEF JUSTICE TURNAGE Opinion delivered the of the Court. AMC) 1 American Company Music and Zollie Kelman (collectively, brought this action seeking declaratory judgment, preliminary and permanent injunctions, and specific performance of a gaming machine Eighth Court, contract. The Judicial County, District Cascade deter- injunctive mined that relief not proper was in a breach of contract ac- pecuniary compensation tion when contemplated and would af- basis, ford relief. On that the court dissolved a re- temporary straining order it had earlier appeals. issued. AMC We affirm. presents three issues for our review: 1. Did the District Court abuse its discretion prohibiting AMC’s machines? *3 Did the court abuse its discretion prelimi- ¶4 nary injunction restraining Higbees from purchasing their own gaming machines? by 3. Did the court abuse its discretion dissolving
injunction requiring Higbees deposit 40 percent of their ma- chine trust account the outcome of this litiga- tion? 1990, parties In entered a agreement concerning written Higbees planned Falls,
casino the operate to build and in Great agreed Higbees Montana. Zollie Kelman to sell the a building site and return, bank guarantee loan. In Higbees agreed give AMC, family company, Kelman’s an exclusive gaming five-year right maintain amusement and machines in the new the agreement, percent casino. Under AMC would receive 40 of the profits percent. from the machines and the would receive 60 parties agreed, again writing, In to extend AMC’s exclu- 10,1998. years, August for an additional three until sive 1996-97, casino, During the winter of remodeled the originally Thirsty’s which was known as but was later rechristened Dust Casino. remodeling, Gold of the the Higbees wanted patrons up-to-date to offer their the most gaming machines on the market. AMC did not have available the of type machines the Higbees Therefore, desired. after some largely unfruitful discussions with Kelman, purchased their own machines. In April they stopped paying its 40 share of profits began paying percent. Additionally, AMC 20 refused in June 1997 to cooperate with AMC to renew the licenses of its machines located in month, casino, and, later that Maeetta Higbee told Kelman to re- eight premises. move of AMC’s machines from the When AMC filed this action in June the District Court is- temporary restraining sued a order prohibiting the Higbees from re- moving interfering operation any with the of AMC’s gaming or amusement machines. After a show cause hearing to determine preliminary injunction warranted, whether a orally the court temporary dissolved the restraining order and application denied the preliminary injunction. court, however, for a allowed time for fil- ing of additional arguments, pending receipt of which it ordered the of their profits into a trust account. In response filed, to additional motions the court issued another
temporary restraining order prohibiting the Higbees from removing or interfering operation with the or amuse- ment machines on their premises. later, business A week the court held another show cause hearing. As a result of the second hearing, the court dissolved temporary its second restraining order and its or- der requiring deposit of a percentage profits machines into a trust account. appeals.
ISSUE 1 10 Did the District Court abuse its discretion grant a preliminary injunction prohibiting from disconnecting AMC’s machines? ruling A preliminary injunction subject motion for the discretion of the district court. Billings County Water Dist. 219, 226, 935 246, 250. 281 Mont. P.2d This Court reviews such rulings for abuse of that discretion. *4 preliminary injunction may A granted be in the following
circumstances:
(1) it appears applicant when that the is entitled to the relief de- manded and the relief or part of the relief consists in restrain- of, complained the act either or continuance of the commission or period perpetually; a limited for
(2) or continuance of some appears it commission when great or produce during litigation jury applicant;
(3) party adverse it appears when procuring suffering do or is threatens or is about to doing or is respecting applicant’s rights, some act in violation be done action, judgment render the inef- tending subject of the fectual;
(4) pendency party, that the adverse appears when ofthe ad- action, dispose is about to remove or to threatens or ofthe an in- applicant, defraud the with intent to party’s property verse disposi- the removal or granted be to restrain junction order tion;
(5) has for an order applicant applied that the Ti- under protection of40-4-121 or an order the provisions under chapter tle that a 27-19-201, MCA. (1), (2), and above. under subsections in this case proper appear it does not subsection disagree. We A to a con injunctive relief demanded. the final entitled to
is for that pay damages and to the contract may choose to breach tract may only relief be 27-1-311, injunctive Final MCA. See § breach. relief, adequate afford would not compensation pecuniary if granted compensa difficult the amount of to ascertain extremely it would be necessary relief, is the restraint tion which would arises from a obligation judicial proceedings, multiple prevent Here, agreements AMC entered trust. Section It money gambling making purpose AMC is full relief to which monetary damages provide entitled. ad- injunctions, parties both hearings on At the one can so that are manufactured machines that the
mitted and so money being earned much is daily basis how tell almost “to the accurately calculated can from the that income of Montana the State acknowledged that also parties penny.” appropri- all income to make sure gamblingmachines monitors going data Additionally, historical for. accurately accounted ately and from the AMC has received much shows how to 1990 back
283 yearly and quarterly basis. We conclude that would machines it compensation difficult to ascertain the amount of would not be which adequate relief. afford (2) provides injunction may Subsection that a preliminary commission appears that or of
be issued continuance produce great act some or above, As this injury applicant. discussed case centers around is entitled income from the at the which machines Casino, Dust and it that will pecuniary compensation Gold Money adequate relief. not damages irrepara considered harm, money damages may ble because be recovered in an action at equity. Dicken law without resort to v. Shaw 255 Mont. P.2d preliminary injunction statute, As to subsection we a similar conclusion. The of ceasing reach to use AMC’s any judgment ineffectual, machines will not render for AMC because monetary it that sufficient compensate for any damages. We hold that the District Court did not abuse its discretion in grant injunction a preliminary prohibiting
ISSUE 2 Did the court abuse discretion a prelimi- injunction nary restraining from purchasing their own gaming machines? parties’ provided: The contract to either
Higbee agrees directly indirectly or purchase [or] purchased any to be or coin-operated non-coin-operated cause gambling games amusement or and device of the kind type or agreement, Thirsty’s, listed in this for use in period agreement agree time covered this further enter not to any any agreement third-party authorize placed to be of the items of the classes de- cause and kinds in agreement Thirsty’s during scribed in this the term this agreement. money damages adequate remedy that would not be an remedy and that an is the proper of this clause breach one. negative enforce a restriction such as this that con- part argument, AMC claims inasmuch as the transaction, applies “[i]t was of a real the rule property
tract agreement an to transfer real the breach of presumed is to be by pecuniary compensation.” relieved adequately cannot be property However, the matters on which re- any purported provisions relate to breach of the sought here do not agreement par- real in the between the property transfer of garding ties. by citing provision in the Higbees respond The to this issue machines supplied by AMC “shall be of latest that the duty supply the latest AMC insists that its contractual
type.” While only supplied to the initial machines applied type of that AMC’s continuing duty, contend not a gambling machines is a supply type the latest to continue failure this breach not Higbees argue agreement. of their breach *6 precludes but also suspend performance them to their only entitled of a by pre- from the court means seeking equitable relief AMC from They out that liminary injunction. point by of a contract an- enjoin entitled to the breach party is not [a] required himself has the contract other, performed he what unless given or has if he himself is in default far as and possible, of him so standing eq- he has no in by defendant nonperformance cause for uity. 111-12. Injunctions, pp. C.J.S. §
43A we hold that the District argument, light In ¶22 preliminary a in to abuse its discretion Court did not gaming their own Higbees purchasing from restraining the junction machines. 3
ISSUE by dissolving preliminary its its discretion the court abuse Did ¶23 their ma- deposit to Higbees injunction requiring litiga- the outcome account receipts into a trust chine tion? financially pay unable to make they claim agreement their by required the amounts trust account in
ments to a pre justifies financial situation that this AMC. AMC sit that their financial contend But the liminary injunction. terms of their comply with the failure to AMC’s is a result of uation pay and necessity purchase that resulting They machines. up-to-date of their own costs operating its obli- AMC to avoid to allow inequitable that it would be maintain gation the latest machines while at the same provide time forcing purported profits. them to set aside AMC’s share of the cites Stark Borner Mont. 735 P.2d case, 314, 316-17. In that this Court upheld appeared respond where it that “defendants be unable to in dam which ages plaintiffs prevail... if would render substantial dam age plaintiffs may unrecoverable, award recover ineffectual and damages... quite further that... would be difficult or impossible ac case, inability In curately pay alleged determine.” that was not Additionally, Stark, of a payee. be a result breach of contract inability pay was not combined with which were difficult contrast, impossible accurately determine. In not appear does any, if difficult damages, to determine in the case. present We hold the District Court did not abuse its discretion in determining preliminary injunction AMC was entitled to a deposit of machine requiring receipts into trust account. Affirmed. NELSON, JUSTICES REGNIER and LEAPHART concur. concurring HUNT in part part. JUSTICE and dissenting in I concur with that ofthe part majority opinion which affirms the deny District decision to the preliminary injunction prohibit- Court’s from ma- deny restraining chines and purchasing their own I from that ofthe majority opinion dissent which holds that Court by dissolving prelim- the District did not abuse its discretion inary injunction requiring into a trust account pending the outcome this liti-
gation. agree majority opinion injunction I with the that an preventing appro-
priate monetary damages relief; because will afford full it is not diffi- damages necessary cult to to monetary ascertain amount relief; ceasing act of to use AMC’s ma- ineffectual, any judgment not render chines will because it monetary damages compensate appears that will be sufficient holding damages. presumes monetary AMC for This entire be should AMC prevail. will available However, monetary damages in this case danger is majority out, opinion points not be As the available. financially a payments “claim unable make themselves required in the amounts trust account statute, According preliminary to the terms ofthe AMC.” may granted: be
(2) appears that the commission or continuance of some when it litigation produce great jury applicant; to the that the adverse is do or doing procuring suffering or threatens or about to is applicant’s rights, respecting
be some act in violation done action, inef- subject tending judgment render the fectual[.] case, In this due money inability judgment be ineffec-
Higbees’ potential pay, injunction is not injure AMC. If a irreparably tual and machines, requiring to utilize AMC’s entered of all required then the should the outcome of this liti- pending into a trust account profits protection some to AMC. in order to afford gation, reason, I the District Court order dissolv- would reverse For this requiring into a trust account of their machine litigation. outcome