Turbiville v. Hansen
Montana Supreme Court
761 P.2d 389 (1988)
Sharon Turbiville (plaintiff) signed a contract for deed to purchase a nightclub, in installments, from Erling and Avis Hansen (defendants). The contract prohibited Turbiville from jeopardizing the club’s liquor license. An escrow agreement between the parties and First National Bank and Trust Company (bank) (defendant) designated the bank as depository for Turbiville’s installment payments. The bank’s only other obligation under the escrow agreement was to cancel the contract, upon demand, should the Hansens ever give notice that Turbiville was in default. Over the next year, the bank called Turbiville whenever she fell behind in making her payments. Turbiville eventually decided to sell her interest in the club to a foreigner. Perhaps too hastily, the Hansens concluded that the sale would cost the club its liquor license. The Hansens notified the bank that Turbiville was in default, and the bank complied with the Hansens’ demand for the contract’s cancellation. Turbiville sued the Hansens but settled with them out of court. Turbiville also sued the bank, contending that the bank should not have canceled the contract without first verifying the basis for the Hansens’ cancellation demand. The trial court entered summary judgment for the bank. Turbiville appealed to the Montana Supreme Court.
Rule of Law
Holding and Reasoning (Weber, J.)
Dissent (Hunt, J.)
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