                             No.    92-075
           IN THE SUPREME COURT OF THE STATE OF MONTANA
                                   1992


IN RE THE MARRIAGE OF
WILLIAM RICHARD CARAS,
                 Petitioner and Respondent,
     and
LAURI CHRISTINE CARAS,
                 Respondent and Appellant.




APPEAL FROM:     District Court of the Fourth Judicial District,
                 In and for the County of Missoula,
                 The Honorable Ed McLean, Judge presiding.


COUNSEL OF RECORD:
           For Appellant:
                 Noel K . Larrivee, Larrivee Law Offices, Missoula,
                 Montana
           For Respondent:
                 Richard Reep, Reep, Spoon       &   Gordon, Missoula,
                 Montana


    <
    ~,                             Submitted on Briefs:   June 25, 1992

                -
           A U G 6 1992                       ~ecided: Ausust 6, 1992
Justice John Conway Harrison delivered the Opinion of the Court.

       This is an appeal from the Fourth Judicial District Court, in
and for the County of Missoula, the Honorable Ed McLean presiding.
Lauri Christine Caras appeals from the final decree of dissolution
which was entered by the Fourth Judicial District Court, Missoula
County, on November 22, 1991, which converted the prior decree of
legal separation to a decree of dissolution, and incorporated the
parties1 prior marital      and property     settlement agreement by
reference.    We reverse.
       The sole issue on appeal is whether the marital and property
settlement agreement executed by the parties should be set aside on
the grounds that the agreement is unconscionable.
       In August of 1978, William ~ichardCaras (William) and Lauri
Christine Caras (Lauri) were married in California. Two sons were
born of the marriage; David, born June 9, 1980 and Nicholas, born
November 16, 1983.
       In December 1988, the partiest marriage began to deteriorate
and William mentioned divorce but Lauri refused.       She showed signs
of depression, withdrawal and weight loss throughout 1989, and in
1990    family   and   friends intervened    when   Lauri   was    totally
withdrawn.       Lauri's condition prompted ~illiam to schedule a
marriage counseling appointment for the couple. They attended just
one session as a couple; Lauri, however, continued individual
counseling between April       and June     1990, in hopes        that the
counseling would aid in a reconciliation with William.     In July
1990, Lauri suggested, and the parties Later agreed, that she

should attend school in Franklin, Tennessee. Although William was
in favor of Laurirs schooling, he still desired a divorce.    Lauri
hoped the change would avoid divorce and help the marriage.   About
this time, the couple began the process of establishing a Marital
and Property Settlement Agreement (the Agreement).     To that end,
William contacted attorney Rick Baskett (Baskett) who previously
represented him in various business matters, and discussed with him
the specifics of the Agreement.     However, due to William and
Baskettrs mutual social and other associations, Baskett referred
William to another attorney, Rick Reep.
     Lauri met with Baskett individually after determining that a
divorce was too drastic a step and decided to attempt a legal
separation.   Lauri alleges that Baskett told her she was possibly
entitled to a larger property settlement than what had been drafted
in the Agreement, but suggested that in order to maintain a
friendly relationship with William and not to impact his business
in a negative manner, she should sign the Agreement.
     The Agreement addressed various matters including custody,
visitation, maintenance, and property distribution.      The record
indicates that Lauri understood the Agreement to be an interim
agreement and not the final word on these issues if the matter
actually proceeded to dissolution. Lauri also alleges that Baskett
advised her to wait until her husband filed for the divorce at
which time she could move      the court to have the Agreement
overturned.     Lauri signed the Agreement in August of 1990 and
departed for school in Tennessee. The executed agreement was filed
with the District Court on August 31, 1990.   On October 11, 1990,
the court issued a decree of legal separation which incorporated
the partiest Agreement.
     Lauri discontinued her Tennessee schooling sometime early in
1991 for various reasons including her individual counseling
sessions.     She also met with William and their children several
times in Tennessee and California.     Lauri remained in Tennessee
until approximately April of 1991, when she returned to Missoula in
an unsuccessful attempt to resolve the marriage problems.
     On May 17, 1991, William filed a motion to convert the legal
separation to a final decree of dissolution; that motion was
granted on May 21, 1991 by Judge Jack L. Green.      Lauri contacted
Baskett to have the order set aside and on July 1, 1991, Judge
Green did set aside entry of decree of dissolution and removed
himself as the judge.   Judge John Renson also recused himself from
the matter and Judge Ed McLean assumed jurisdiction of the matter
on July 10, 1991.
     Judge McLean held a hearing on July 31, 1991 regarding the
issues of whether the decree of separation should be converted to
a decree of dissolution and, secondly whether the Agreement should
be set aside. At the July 31, 1991 hearing, Judge McLean carefully
set forth time constraints for motions and briefs.   Baskett did not
file any brief or make any response to the court's directive of
July 31, 1991. Baskett sent Lauri a stipulation which she alleges
she was confused about signing.   She alleges that Baskett told her
that it was the only means to get the money that William owed her,
but she refused to sign the stipulation.
     William again filed a motion to convert the decree of legal
separation entered by the court on October 11, 1990, to a final
decree of dissolution, incorporating all terms and conditions set
forth in the Agreement.   On November 22, 1991, after no filings
were made by Lauri for a period of nearly two months, the court
granted William's motion and entered the final dissolution decree,
as requested, which incorporated the Agreement.   With new counsel
of record, Lauri now appeals to this Court.
     The issue in the case at bar cannot adequately be reviewed by
this Court because the final decree of dissolution contains no
findings regarding the conscionability of the Agreement.        The
entire contents of the final decree dated November 22, 1991, is as
follows:
     Upon Motion by Petitioner and good cause appearing, the
     Court orders that the Decree of Legal Separation entered
     by the Court on the 11th day of October, 1990, be
     converted to a Final Decree of Dissolution incorporating
     all terms and conditions set forth within the parties'
     Marital and Property Settlement Agreement as adopted by
     this Court in the Decree of Legal Separation previously
     referenced.
     While we will not discuss every term in the Agreement, with
regard to the property division aspects of g 40-4-202, MCA, that
statute establishes the criteria under which such property should
be distributed. The court may "finally equitably apportion between
the parties the property and assets belonging to either or both,
however and whenever acquired." Section 40-4-202, MCA; also see In
re Marriage of Scott (Mont. July 21, 1992), No. 92-081, Slip Op. at
5. The statute then lists factors which the court must consider in

property distribution.   The above-referenced decree contains no
reference to the required criteria.
     This Court is not unmindful of the fact that both parties
signed the Agreement in August of 1990 as a prelude to the legal
separation proceeding.   However, the record indicates that there
was substantial confusion regarding the parties1 understanding of
the long-term ramifications of the Agreement.     Lauri repeatedly
indicates that she believed the Agreement to be temporary or
interim in nature while the couple pursued restoration of their
marriage.    The record indicates that with her departure to
Tennessee fast approaching and her understanding of the temporary
nature of the Agreement, she signed the Agreement.       Lauri was
apparently lead to believe that upon the initiation of actual
divorce proceedings, the provisions of the Agreement could be
replaced or revised.
     In the case at bar the District Court should have addressed
the conscionability of the Agreement especially in light of the
circumstances and understandings of the parties; in particular, the
fact that the Agreement was signed in August of 1990 and the final
decree of dissolution which incorporated it was entered in November
of 1991. Accordingly, we vacate and remand this matter back to the
District Court for findings as to whether or not the Agreement is
conscionable.   If found unconscionable, the decree of dissolution
should be set aside and an equitable division of the property and
all related matters should be addressed. Reversed and remanded to
the District Court.




We concur:
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