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McLain v. McLain
United States District Court, D. Montana, Billings Division
March 12, 2018
FAITH MCLAIN, CHRISTEEN MCLAIN, JOHN MCLAIN, MOLLY MCLAIN, MIRA MCLAIN, AND MATTHEW MCLAIN, AS BENEFICIARIES OF THE ESTATE OF BERNARD MCLAIN, AND MARY MCLAIN, INDIVIDUALLY AS BENEFICIARY OF THE ESTATE OF BERNARD MCLAIN AND AS TRUSTEE OF THE E-3 RANCH TRUST, Plaintiffs,
FRANCIS MCLAIN, INDIVIDUALLY AND AS CO-MANAGER OF TERA BANI RETREAT MINISTRIES, CAROLINE MCLAIN, INDIVIDUALLY AND AS MANAGING DIRECTOR OF TERA BANI RETREAT MINISTRIES, ALAKHI JOY MCLAIN, SOHNJA MAY MCLAIN, AND DANE SEHAJ MCLAIN, AS PURPORTED CERTIFICATE HOLDERS OF THE E-3 RANCH TRUST, Defendants. THE UNITED STATES OF AMERICA, Intervenor Defendant and Counter/Cross Claimant,
FAITH MCLAIN, CHRISTEEN MCLAIN, JOHN MCLAIN, MOLLY MCLAIN, MIRA MCLAIN, AND MATTHEW MCLAIN, as Beneficiaries of THE ESTATE OF BERNARD MCLAIN; and MARY MCLAIN, as Beneficiary of the ESTATE OF BERNARD MCLAIN, and as Trustee of the E-3 RANCH TRUST, Counterclaim Defendants, and FRANCIS MCLAIN, Individually, and as Co-Manager of TERA BANI RETREAT MINISTRIES; CAROLINE MCLAIN, Individually, and as Managing Director of TERA BANI RETREAT MINISTRIES; and ALAKHI JOY MCLAIN, SOHNJA MAY MCLAIN, AND DANE SEHAJ MCLAIN, as Beneficiaries of the E-3 RANCH TRUST, Crossclaim Defendants, and AMERICAN BANK OF MONTANA, Additional Defendant on United States' Claims
P. WATTERS, UNITED STATES DISTRICT COURT JUDGE
the Court are United States Magistrate Judge Timothy
Cavan's findings and recommendations filed January 17,
2018. (Doc. 122). Judge Cavan recommends this Court deny the
McClain Defendants' motion for summary judgment (Doc. 82)
to quiet title in half the interest in the E-3 Ranch, deny
the McClain Plaintiffs' cross motion for summary judgment
(Doc. 96) on the same issue, and stay the action pending
appointment of a personal representative for the estate of
Standard of review
McClain Defendants filed timely objections to the findings
and recommendations. (Doc. 124). The McClain Defendants are
entitled to de novo review of those portions of Judge
Cavan's findings and recommendations to which they
properly object. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P.
McClain Defendants object to what they perceive as Judge
Cavan's characterization of the facts. The McClain
Defendants' objections to Judge Cavan's background
section do not affect the outcome. Judge Cavan's
background section is adopted in full.
McClain Defendants make four objections. First, they argue
the McLain Plaintiffs are barred from litigating what the
agreement was between Frank McClain and Brad Hall because, in
their view, the McClain Plaintiffs are uninterested parties
to the agreement. Second, they argue even if the McClain
Plaintiffs are not barred from litigating what the agreement
was, the undisputed facts show the agreement was that Frank
and Brad would each take a one-half interest in the E-3
Ranch. Third, they argue the McClain Plaintiffs are barred
from defending the quiet title claim because they did not
possess or have an interest in the property within the
previous five years. Fourth, they argue the case should not
be stayed because the estate of Bernard is not a necessary
The McClain Plaintiffs are not barred from litigating what
the agreement was between Frank and Brad
McClain Defendants argue the McClain Plaintiffs may not seek
a determination of the agreement between Frank and Brad
because the McClain Plaintiffs are strangers to the
agreement. The Court disagrees.
McClain Defendants are correct that, generally, strangers to
a contract do not have standing to sue for a breach of the
contract. Palmer v. Bahm, 128 P.3d 1031, 1034 (Mont.
2006). However, the McClain Defendants are incorrect that
Palmer bars the parties litigating what the
agreement was between Frank and Brad.
McClain Plaintiffs are arguably interested parties to the
agreement, not strangers, because Frank conveyed to Bernard
via quitclaim deed "all interest, equity, and
claim" Frank had in the E-3 Ranch. (Doc. 5-1 at 37). The
transfer of property is an executed contract subject to all
rules concerning contracts. Mont. Code Ann. § 70-1-502.
Similar to an assignee and assignor relationship under
contract principles, a grantee stands in the shoes of the
grantor. Watts v. HSBC Bank U.S. Trustee, 308 P.3d
57, 61 (Mont 2013); Carter v. Heitzman, 198 A.D.2d
649, 649-650 (N.Y.App.Div. 1993). Bernard, and arguably his
devisees, are the grantees of Frank's interest in the E-3
Ranch, and stand in Frank's shoes.
determinations of prior conveyances are fairly common in
quiet title actions because a quitclaim deed transfers only
such title and interest as the grantor had when he delivered
the title. Turner v. Wells Fargo Bank, N.A., 291
P.3d 1082, 1090 (Mont. 2012). The McClain Plaintiffs, as
Bernard's devisees, have a colorable claim to
Bernard's interest in the E-3 Ranch, which in turn
depends on what Frank's interest was in the E-3 Ranch.
Frank's interest in the E-3 Ranch depends on what the
agreement was between him and Brad. The McClain Plaintiffs
therefore do not seek to enforce the agreement between Frank
and Brad, but rather seek to determine what the agreement was
because the terms of the agreement are material to the
determination of this outcome. See Somont Oil Co., Inc.
v. Nutter, 743 P.2d 1016, 1021-1022 (Mont. 1987)
(determining plaintiff s interest in parcel of land by
analyzing prior conveyances of the land made by other
persons); Carter, 198 A.D.2d at 649-650 (in quiet
title action, determining interests of plaintiff and
defendant by analyzing prior conveyances of the land made by
other persons). The McClain Plaintiffs are not barred from
seeking a determination of what the agreement was between
Frank and Brad.
Whether Frank and Brad agreed to each take a one-half
interest in ...