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Davey v. Nessan
Montana Supreme Court
830 P.2d 92 (1992)
Connecticut Mutual Life Insurance Company (Mutual) (defendant) loaned money to Edward Nessan and Donald Dubeau (defendants) to buy farms belonging to M. Davey and H. Koessler (plaintiffs). Nessan and Dubeau bought the farms through contracts for deed, which are real estate contracts involving a series of installment payments made to the sellers. Mutual took a security interest in Nessan and Dubeau’s interest in the contracts for deed. At Mutual’s request, the sellers and Mutual also entered an agreement giving Mutual the right to make payments “at its election and without obligation” in the event Nessan and Dubeau defaulted on the contracts for deed. A few years later, Nessan and Dubeau defaulted on their Mutual loan. Mutual got Nessan’s and Dubeau’s interest in the farms to satisfy its loan. For several years, Mutual made payments on the contracts for deed for the farms. Then Mutual gave the farms back to the sellers. The sellers accepted possession of the farms, but they also sued Nessan, Dubeau, and Mutual to recover the money still owed under the contracts for deed. The trial court dismissed Mutual from the case. All the remaining parties appealed, arguing that Mutual had impliedly assumed Nessan’s and Dubeau’s obligations under the contracts for deed.
Rule of Law
Holding and Reasoning (Trieweiler, J.)
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