           IN THE SUPREME COURT OF THE STATE OF MONTANA




BURKE A. ESCHLER, LORI I. ESCHLER and
JAM1 G. ESCHLER, individually and as
Co-Personal Representatives of the
Estate of JAMES P. ESCHLER, Deceased,         y -4
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JANET ETHEL ESCHLER, LEO B. LAPITO,
ROBERT SOLIE and HOFFMAN ASSOCIATES,
INC., a Montana Corporation,
           Defendants and Respondents.



APPEAL FROM:    District Court of the Thirteenth Judicial District,
                In and for the County of Yellowstone,
                The Honorable G. Todd Baugh, Judge presiding.


COUNSEL OF RECORD:
           For Appellants:
                Allen D. Gunderson; Gunderson Law Firm, Billings,
                Montana
                Jerome J. Cate; Cate Law Firm, Whitefish, Montana

           For Respondents:
                Don M. Hayes; Herndon, Hartman, Sweeney                  &    Halverson,
                Billings, Montana


                             Submitted on Briefs:     February 23, 1995
                                         Decided: March 30, 1995
Filed:
Justice Karla M. Gray delivered the Opinion of the Court.

     This is an appeal from a grant of summary judgment by the
Thirteenth Judicial District Court, Yellowstone County. We affirm.
     The sole issue on appeal is whether the District Court erred
in determining that no genuine issues of material fact exist with
regard to appellants' claim and that respondents are entitled to
judgment as a matter of law.
     This appeal is the second of two by these appellants, both of
which relate generally to certain life insurance polices of
decedent James Eschler (James).   In the earlier case, appellants
Burke Eschler, Lori Eschler, Jami Eschler and Sharon Ille--James1
children and fiancee, respectively--appealed a grant of summary
judgment in favor of James' former spouse Janet (Janet) regarding
entitlement to proceeds of two life insurance policies issued by
Minnesota Mutual Life Insurance Company and one policy issued by
Mutual Benefit Life Insurance Company. We affirmed in Eschler v.
Eschler (1993), 257 Mont. 360, 849 P.2d 196, which sets forth the
basic factual underpinnings of both cases. We include herein only
those facts necessary to resolve the issue now before us and note
that Mutual Benefit Life Insurance Company has been dismissed as a
party to this appeal.
     In March of 1990, appellants filed an action against Janet and
Mutual Benefit Life Insurance Company    (Mutual Benefit).    They
claimed entitlement to the proceeds of either of two Mutual Benefit
life insurance policies, the first obtained during James and
Janet's marriage ("first policy") and the second applied for by
James in August of 1989 and effective in an increased amount in
September    of    1989   ("second policy").   Among   other   things,
appellants' original complaint alleged that Leo Lapito (Lapito)--
from whom, as Mutual Benefit's agent, James purchased the second
policy--knew or should have known that James intended the second
policy to replace the first policy.
     In September of 1990, appellants were permitted to amend their
complaint.        The amended complaint added Lapito, Robert Solie
(Solie) and Hoffman Associates, Inc. as named defendants.           It
alleged negligence relating to the second policy based on a breach
of duty to inform James of certain information; the duties at issue
are imposed by insurance regulations concerning replacement of
existing life insurance.       The thrust of the action was that the
breach of duty should preclude reliance by Mutual Benefit on the
suicide exclusion contained in the second policy, to the end that
appellants would be entitled to the proceeds of that policy.
     On October 5, 1990, respondents moved to dismiss pursuant to
Rules 12 and 56, M.R.Civ.P., contending that the amended complaint
failed to state a cause of action for which relief could be
granted, that no genuine issues of material fact existed, and that
they were entitled to judgment as a matter of law.         Appellants
subsequently sent discovery requests to respondents Lapito and
Solie.      Respondents moved    for a protective order.       Both of
respondents' motions were fully briefed and submitted to the
District Court.
     On July 25, 1991, the District Court entered its Memorandum
and Order granting respondents' motion for summary judgment and
determining, on that basis, that the motion for a protective order
was moot.    On appeal, appellants contend that the court erred in
determining that no genuine issues of material fact existed on the
record before it and, furthermore, that their inability to conduct
discovery prevented them from presenting all the factual issues to
the court.
     A party moving for summary judgment must establish the absence
of genuine issues of material fact and entitlement to judgment as
a matter of law. Rule 56 (c), M.R.Civ.P. Once the moving party has
met its burden, the nonmoving party must come forward with evidence
showing the existence of a genuine issue of material fact.    Rule
56 (c), M.R.Civ.P.   The facts presented must be of a substantial
nature; conclusory or speculative statements are insufficient to
raise genuine issues requiring trial. Nimmick v. Hart (1991), 248
Mont. 1, 7-8, 808 P.2d 481, 485      (citation omitted).   Because
summary judgment is never to be used as a substitute for trial
where genuine issues exist, however, all inferences from the
evidence presented must be resolved in favor of the nonmoving
party. See State Med. Oxygen v. American Med. Oxygen (Mont. 1994),
883 P.2d 1241, 1243, 51 St.Rep. 1063, 1064 (citation omitted).
This Court reviews the grant of a motion for summary judgment
utilizing the same criteria as are initially applied by the trial
court. Minnie v. City of Roundup (1993), 257 Mont. 429, 431, 849
P.2d 212,   214.

      The dispute before us relates specifically to the second
Mutual Benefit policy covering James' life. James purchased this
policy, in the amount of $100,000, from Lapito on August 7, 1989.
James signed the application for the policy, which indicated that
the   second policy would not         replace or change any existing
insurance.     He executed an amendment to the application the
following day, increasing the          face amount of   the policy    to
$250,000. The named beneficiaries were James' fiancee, Ille, and
his children--appellants herein.        The policy contained a suicide
exclusion    and,   because   James    committed   suicide   within   the
exclusionary period, Mutual Benefit denied payment under the
policy.
      Appellants' negligence action against respondents alleges that
defendants Lapito and Solie were life insurance agents licensed
pursuant to Montana law and, further, that they were agents of
defendants Hoffman Associates and Mutual Benefit.             Appellants
assert that James' intent was to replace the first Mutual Benefit
policy--and, indeed, the two Minnesota Mutual policies--with the
second Mutual Benefit policy and to allow the earlier three
policies to lapse. They allege that both Lapito and Solie knew or
should have known of James' alleged intent and that both received
commissions from the sale of the policy.           As such, appellants
allege that both individual defendants had an affirmative duty to
comply with Montana law concerning replacement of existing life
insurance coverage. The underlying premise is that the breach of
that duty caused them injury.         Hoffman Associates and Mutual
Benefit are liable for the breach, according to appellants, under
a theory of respondeat superior.
     It is hornbook law that liability in a negligence action is
imposed where a plaintiff establishes breach of a duty which
proximately causes injury or damage. The first essential element
which must be established in a negligence action is the existence
of a duty. Burk Ranches, Inc. v. State (IggO), 242 Mont. 300, 308-
09, 790 P.2d 443, 448. Whether a duty exists is a legal question
to be determined by the trial court.           Buhr v. Flathead County
(Mont. 1994), 886 P.2d 381, 388, 51 St.Rep. 1258, 1263 (citation
omitted). Because we conclude that the specific duties for breach
of which appellants seek recovery are not applicable here as a
matter   of   law, we   need   not   address   the   other   elements of
appellants' negligence action.
     In this case, the duties alleged to have been breached are
contained in    5 6.6.305, ARM.      Section 6.6.305, ARM, begins by
requiring that applications for life insurance policies contain a
"statement signed by the applicant as to whether or not such
insurance will replace existing life insurance       . .   . , " as well as
a signed statement by the agent "as to whether or not the agent
knows replacement is or may be involved in the transaction."
Section 6.6.305(11, ARM.        It is undisputed that these duties
applied to James' application of August 7, 1989, for the second
Mutual Benefit policy.
     With regard to these duties, however, the record is clear that

the application contained a question regarding replacement, change,
or borrowing against existing insurance, that the question was
answered in the negative, and that both James and Lapito signed the
application. In addition, Lapito's "Agent's Report" also indicated
that no insurance had been replaced and that no such action was
planned.   Thus, respondents established that no genuine issue of
material fact existed regarding the breach of these duties.
     Appellants assert, however, that no proof exists that James
actually filled out the application himself or that he read the
application before signing it.       They offer no authority for the
proposition that an applicant for insurance is required to fill out
the application himself or herself and, indeed, 5 6.6.305(1), ARM,
mandates only that the application contain the statement regarding
replacement and that it be signed.        Moreover, the terms of the
application itself state that by signing it, both James and Lapito
represented that all of the statements in the application were true
to the best of their knowledge and belief.         The burden having
shifted to appellants to show a genuine issue of material fact in
this regard, appellants failed to come forward with any evidence
that the duties imposed by   §             ,
                                 6.6.305(1) ARM, were breached. Their
speculative statements attempting to raise suspicions do not rise
to the presentation of facts of a substantial nature. See Nimmick,
808 P.2d at 485.       Nor can any inferences be drawn from the evidence
presented which, resolved in appellants' favor, tend to establish
a genuine issue of material fact regarding breach of these duties,
        Appellants     also   argue   that   the    duties       contained             in    §

6.6.305(2) (a) tc) , ARM, apply here.
              -                                  It is undisputed that those
duties were not met by respondents.              Thus, if those duties apply,
they have been breached by respondents.
        By   its    terms,    §   6.6.305(2), ARM,       applies          [w]here            a
replacement        [of existing insurance] is involved .              .   .   .   li        AS
defined in    §    6.6.303 (7)(a), ARM, llReplacement''
                                                      means a transaction
in which new life insurance is being purchased and the agent knows,
or should know, that existing life insurance is to be lapsed.
Appellants'        argument   in this   regard      is   that, because                 James
permitted other policies to lapse via nonpayment of premiums after
the second Mutual Benefit policy was applied for and obtained,
replacement actually occurred and, thus, the               §     6.6.3 05 (2)   , ARM,
duties were applicable as a matter of law.
        The problem with appellants' argument is that James attested
in writing that no existing insurance w a s               to be replaced on
issuance of the second Mutual Benefit policy.                     By signing the
application, he also attested that the statements made therein were
true and complete to the best of his knowledge and belief. On that
basis, we conclude that the duties imposed by                §   6.6.305(2),            ARM,

l1   [wlhere a replacement is involved       .    . . " were not applicable to
respondents here regarding the second Mutual Benefit policy.
    Appellants raise a convoluted series of occurrences and
circumstances which they contend raise a genuine issue of material
fact regarding James' intent regarding lapse of the other life
insurance policies at the time he applied for the second Mutual
Benefit policy.    We   need not    address these occurrences and
circumstances individually; it is necessary to note only that most
of them are totally unrelated to respondents herein and what
respondents actually knew or should have known.   James may or may
not have intended--either at the time he applied for the second
Mutual Benefit policy or at some later time--to allow other
policies to lapse. As the District Court observed, we will never
know James' true intent during a troubled period in his life.
Whatever his secret intent may have been, it   cannot be attributed
to respondents herein, given documentary evidence of James' stated
intent not to replace existing insurance and sworn affidavit
evidence that James never indicated in any way that the second
Mutual Benefit policy was intended to replace any existing policy
or policies. While the circumstances cited by appellants might be
pertinent in an action in which James' intent was the issue in
dispute, it does not create an issue of material fact in this
action concerning what respondents knew or should have known.
     Appellants' final argument regarding the existence of a duty
is that the requirements of     5   6.6.305, ARM, were   separately
applicable to James' execution of an amendment to the August 7,
1989, application the following day.    The amendment increased the
coverage under the second Mutual Benefit policy from $100,000 to
$250,000. Appellants contend that the amendment constituted a new
application llreplacingll policy for which application was made
                        the
one day earlier and, as a result, the duties of both subsection (1)
and subsection (2) of     § 6.6.305,    ARM, were applicable.
      Appellants cite no authority for their position and a plain
reading of the insurance regulations at issue does not support it.
Indeed, the regulatory definition of "replacementI' references a
transaction in which Itnewt'
                           life insurance is tw be purchased and
existing life insurance is to be lapsed or otherwise terminated.
Section 6.6.303(7), ARM.       No new insurance was being purchased by
James on August 8; he merely sought to increase the face amount of
the new insurance for which he had applied the day before.
Similarly, the Itexistinglife insurance" of August 7 was not being
lapsed or otherwise terminated; the coverage was merely being
increased. The regulations relied on by appellants do not require
an entirely new application procedure and resulting reimposition of
duties when an increase in the face amount of coverage under a life
insurance policy is sought.          Thus, we conclude that the duties
contained in    §    6.6.305, ARM,      do not apply when an existing
application for life insurance is amended to increase the face
amount of the policy.
      The District Court did not err in concluding as a matter of
law   that   respondents'     duty     to   comply   with   the   replacement
provisions of   §   6.6.305( 2 ) , ARM, did not arise unless a replacement
was involved. The court also did not err in determining that, on
the record before it, appellants did not raise a genuine issue of
material fact regarding whether a replacement was involved in
James' August 7, 1989, application for the second Mutual Benefit
policy. We hold, therefore, that the District Court did not err in
granting respondents' motion for summary judgment.
     Finally, we address briefly appellants' contention that they
were precluded from raising genuine issues of material fact by
their inability to conduct discovery. As noted above, the original
complaint in this case was filed in March, 1990, and contained
allegations that Lapito knew or should have known that the second
Mutual Benefit policy was intended to replace the first policy.
Appellants' amended complaint--adding Lapito, Solie and Hartmann
Associates as named defendants under the same theory as was raised
in the original complaint--was filed in September, 1990.    On this
record, we cannot conclude that appellants were "unable" to pursue
discovery.   Any llfault"arising from the decision not to do so
until after respondents moved to dismiss or for summary judgment
cannot be imposed on respondents or the District Court.
     Moreover, we have carefully scrutinized respondents' motions
in the District Court and the briefs in support of, and opposition
to, those motions.   Appellants did not request the District Court
to delay ruling on the motion to dismiss or for summary judgment in
order that they could obtain sufficient discovery to raise genuine
issues of material fact pertinent to respondents' motion.    Such a
procedure is authorized by Rule          56   (f), M.R.Civ.P., and, upon
sufficient showing, may result in a continuance for discovery
necessary to respond to a summary judgment action. Appellants not
only did not avail themselves of this procedure, they argued in
response to respondents' motion for protective order that they had
raised genuine issues of material             fact in their briefs and
supporting documents.
     As a general rule, we will not consider an argument raised for
the first time on appeal.        w, 8 8 6     P.2d   at 389.   This rule is
particularly appropriate in circumstances such as this, where a
specific procedure was available by which appellants could have
sought the relief they now seek from this Court and, indeed, where
appellants now take a position inconsistent with that presented to
the District Court.
     Finally,   we     observe    that   the    discovery      requested   of
respondents   Lapito    and   Solie was       largely unrelated      to    the
allegations constituting appellants' negligence action against
them.   Many of the interrogatories sought information about the
commission split on the second policy between Lapito and Solie;
others inquired about James' payment of premiums for the first
policy and the individual respondents' ongoing commissions under
that policy; and others sought to delve into an entity called
Business and Estate Planning with which Lapito apparently was
connected. In short, the interrogatories were largely unrelated to
appellants' allegations that respondents breached applicable duties
under   §   6.6.305, ARM.
     For these reasons, we conclude that appellants were not
''unable"to conduct discovery.
     Affirmed.
     Pursuant to Section I, Paragraph 3(c), Montana Supreme Court
1988 Internal Operating Rules, this decision shall not be cited as

precedent and shall be published by its filing as a public document
with the Clerk of the Supreme Court and by a report of its result
to Montana Law Week, State Reporter and West Publishing Company.




We concur:
                                         March 30, 1995

                                  CERTIFICATE OF SERVICE

I hereby certify that the following certified order was sent by United States mail, prepaid, to the
following named:


Jerome J. Cate
Cate Law Firm
P.O. Box 1207
Whitefish, MT 59937-1207

Allen D. Gunderson




                                                    ED SMITH
                                                    CLERK OF THE SUPREME COURT


                                                    BY
                                                    Deputy
                                                             0
                                                    STATE OF MONTANA
