                                    No. 14211

                   IN THE SUPREME COURT OF THE STATE OF MONTANA
                                        1978


MAW;E   KIS and ROBFRT HAPP,

                                Plaintiffs and Appllants,

            -vs-

HARRY PIFER,

                                Defendant and Respondent.



Appeal frm: District Court of the Eleventh Judicial District,
            Honorable James M. Salansky, Judge presiding.

Counsel of Record:
        For Appellants:

            H James Oleson argued, Kalispell, Montana
             .
        For Respondent :

            Warden, Walterskirchen and Christiansen, Kalispell, Montana
            Frederick F. S h e m a d argued, Kalispell, mntana
            McGarvey, Lence and Heberling, Kalispell, mntana




                     ?Q72
                      >   -
Filed:       -
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.

     The District Court, Flathead County, sitting without a
jury, dissolved the parties' partnership and ordered an
accounting and the assets distributed.          Plaintiff, Marge
Kis, appeals from the court's order denying her motion to
amend the findings of fact.
     In August 1973, Marge Kis, Robert Happ and Harry Pifer

entered into a verbal partnership agreement for the purpose
cf buying real property in Flathead County, Montana.           The
parties intended to realize a profit by developing the
property and reselling it.      The agreement contemplated that
each of the parties would contribute funds periodically and

that such contributions would be approxi~atelyequal between
the parties, as circumstances permitted and the needs of the
partnership dictated.      It was further agreed that each of
the parties would own a one-third interest in the properties
purchased.
     The partnership purchased a tract of land in October,
1973, known for purposes of this appeal as the "Meridian
Road" property. Contributions for purchase of the Meridian
Road property were made in cash in the following amounts:
Marge Kis    --   $6,000.00; Robert Happ   --   $4,000.00; Harry
Pifer   --   $8,000.00, of which the amount of $2,000.00 was
later refunded to him out of partnership funds.          The total
purchase price of the land was $35,000.00, so Marge Kis
obtained a loan of $20,000.00 from her father to pay the

remainder owing.      This loan was later repaid out of the
proceeds of a loan against the land, obtained from a commercial
lending institution in Kalispell, Montana.          Title to the
property was taken in the name of Harry Pifer only, by
mutual consent and for the convenience of the parties.
Consequently, Pifer signed the note and mortgage when the
loan against the property was obtained.
     In 1974, the parties constructed eight storage units on
the Meridian Road property.     In 1975, it was agreed that
additional units were necessary as well as two larger structures
for rental purposes.     Harry Pifer supervised the construction
which was financed from the joint funds of the parties and
$20,000.00 deposited by Marge Kis.
     During the spring of 1976, Harry Pifer assumed control
of the Meridian Road property and advised plaintiffs that he
considered himself its sole owner.
     Plaintiffs instituted this action July 14, 1976, seeking
a dissolution of the partnership and an accounting of its
assets.   The District Court entered its findings of fact,
conclusions of law, order and decree on October 24, 1977.
Subsequently, plaintiff Marge Kis moved to amend findings of
fact No. 20, which concerned the construction of the additional
storage units and two larger structures.     Finding of fact
No. 20 states:
     "20. That such construction was financed initially
     from the joint funds of the parties and from $20,000
     deposited by Marge Kis which represents additional con-
     sideration for the deed from Defendant Harry J. Pifer
     to her and which deed transferred his interest in the
     Lake View Arms property in Whitefish, Montana, said
     property not being involved in the partnership at
     hand. "
     The finding was made on the basis of testimony by Harry
Pifer.    Plaintiff contended that the court should have
believed her testimony on the matter, rather than Harry
Pifer's, because his credibility had been impeached on
another issue, while plaintiff's credibility had never been
impeached.    The District Court denied the motion and this
appeal followed.
     1.      Did the District Court improperly make finding of
fact No. 20, since it had been agreed that the trial would
be in two phases   --   first, a determination of who owned the
Meridian Road property, and then an accounting of partner-
ship property?
     2.   If the finding of fact was properly made, did the
District Court abuse its discretion by ruling in defendant's
favor, after his credibility had been impeached on a separate
matter?
     Plaintiff contends she understood that the trial would
be conducted in two phases.   Specifically, the first phase
would be limited to deciding whether Harry Pifer or the

partnership owned the Meridian Road property.    In the second
phase an accounting of partnership matters would take place.
Plaintiff states she withheld evidence relevant to the
Meridian Road dispute because of this "understanding".
     We find that, because of developments in the course of
the proceedings, plaintiff was fully aware that the District

Court would be rriaking a finding concerning the nature of her
$20,000.00 contribution.
     Count I1 of defendant's counterclaim, filed August 19,
1976, clearly placed the issue concerning the nature of
plaintiff's $20,000.00 contribution before the court.
Defendant's prayer under Count I1 stated:
     "That the plaintiff, Marge Kis, be required to
     accept the transfer of the defendant's equity in
     the Whitefish Arms property, as a full satisfaction
     of any monies advanced by Marge Kis personally, and
     particularly, the sum of $20,000.00 for the improve-
     ment of the Meridian Road property;"

Plaintiff moved to strike the count on the grounds that it
was redundant and immaterial to the dispute.    Her notion was

denied January 11, 1977.   At this point plaintiff was on
notice that the court would be deciding the issue.
     At the conclusion of the trial plaintiff offered a
finding of fact on the precise issue she now contends she
understood would be decided in a subsequent proceeding:
     "XX. That such construction was financed
     initially from the joint funds of the parties and
     from a $20,000.00 loan made by Marge Kis to the
     joint operation of the parties which loan has
     never been repaid and is still outstanding."
     (Page 6 of Proposed Findings of Fact and Con-
     clusions of Law of Plaintiffs.)
     On October 25, 1977, the day after the District Court
entered its findings of fact, conclusions of law, order and
decree, plaintiff filed a document entitled, "Exceptions to
findings of fact and motion to amend same."         Specifically,
plaintiff excepted to finding of fact No. 20, contending

that her testimony should have been believed rather than the
defendant's, and that the finding shculd have been made in
her favor.    She did not contend that the court shculd not

have made any finding on the subject, as she has in this
Court, rather she contended the result of the finding was
improper.

     Plaintiff's actions during the course of the trial

demonstrate that she was fully aware that the court would be
resolving the issue concerning the nature of her $20,000.00
contribution.

     Alternatively, plaintiff contends the District Court
abused its discretion by relying on defendant's testimony,
rather than hers, to make finding of fact No. 20.          The
following dialogue between plaintiff Happ's counsel and
defendant is offered to show that defendant's credibility
was impeached and that he should not have been believed on
any point.

     "Q. And did anybody else put any money in at that
     time in connection with that purchase? A. Yes, my
     father.

     "Q. And who and ~ G much, as you recall?
                          W                           A.   My
     father lent me $20,000.00 And Marge --
     "Q. Just a minute. Let's get to that now. You
     said your father lent you $20,000.00? A. That
     is correct.
     "Q.     Did you give him a note for it?   A.    No.
     "Q.    And was any note given to your father for it?
    A.     Not to my knowledge at that time.

     "Q. Well, did you find out later that any note was
     given? A. Yes, Sir.
     "Q.    Okay. And who gave that note?   A.   Marge did.
     "Q. So Marge in effect borrowed the money from
     your father on her note for $20,000.00? A. No.
     I borrowed the money but she signed the note.
    "Q. Were you here when your father testified last
    fall, when the poor man broke down and cried on the
    witness stand, and we had to take a recess, Mr. Pifer.
    When he stated that he loaned the money to Marge, he
    was dealing with Marge. Are you now saying that he was
    lying? A. No. Mr. Warden.
     "Q.    Your own father? A.   That
     "Q. Answer yes or no. Answer the question as I asked.
     A. No, he is not lying.
     "Q. Then he loaned the money to Marge on Marge's
     note and that went into evidence at that time. It
     is in the Court file. A. Yes."
     The $20,000.00 referred to above is the contribution
made in October 1973, for the purchase of the Meridian Road
property, not the $20,000.00 which is the subject of finding
of fact No. 20.
     "There is a general principle of law that where
     a witness has testified falsely to some material
     matter in a case, his testimony in other respects
     may be disregarded unless it is corroborated by
     other proof . . . In order for the principle
     to be operative, the false testimony must be
     upon a point material to the issue . . .
     The principle or maxim above stated as to dis-
     regarding the testimony of a witness who has
     knowingly testified falsely on a material
     issue does not necessarily mean that the
     jury is required to reject the rest of the
     witness' testimony   .
                          . . The right and
     the duty of the jury to determine to what
     extent they believe or disbelieve the
     witness thus continue." 81 Am.Jur.2d
     Witnesses 8669.
     To a similar effect, we stated in Batchoff v. Craney
(1946), 119 Mont. 157, 172 P.2d 308:
      ". . . [Wlhile proof of falsity in one part of a
      witness' testimony, inconsistent statements at
      other times, contradictory evidence, and reputation
      may discredit the witness, such proof goes only
      to the credibility of the witness, of which the jury
      remains the sole judge, as well as the weight to
      be given thereto    ... [Allthough the jury may
      reject the false testimony and assume regarding
      the rest of it, an attitude of distrust, the
      jurors may render a verdict based upon the testi-
      mony of such witness if after examination they
      find it worthy of belief."

         The District Court was the trier of fact in the instant
 case.    The dialogue offered by plaintiff was not essential
 to the issue which was resolved by finding of fact No. 20.
 Even assuming defendant was impeached on the earlier issue,
 the court was not bound to rule against him on every fact
 issue in the trial.
      We will not set aside findings of fact unless they are
 clearly erroneous and we will give due regard to the opport-
 unity of the trial court to judge the credibility of the
 witnesses.     Rule 52, P4ont.R.Civ.P.
         The decision of the District Court is affirmed.




 We Concur:
                                          ?   Justice




Mr. Justice John Conway Harrison dissenting:
     I dissent.


                                          ea-.
                                          Justice
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