Precision Theatrical Effects, Inc. v. United Banks, N.A., 2006 MT 236

Summary

The Montana Supreme Court reviewed summary judgment in a dispute concerning a bank's declaration of default and freezing of a corporate customer's accounts. The court held that genuine issues of material fact remained regarding the bank's good-faith belief that repayment was impaired and whether freezing the accounts was authorized, requiring reversal on the breach-of-contract and implied-covenant claims. The court affirmed summary judgment for the bank on the claim that a fiduciary relationship existed.

Holdings

1. Summary judgment was improper because genuine issues of material fact remained as to whether United had a good-faith belief that collection was impaired and whether it acted with honesty in fact when it declared a default and froze accounts without specific contractual authority.
2. The District Court erred in granting summary judgment on the implied covenant of good faith and fair dealing claim because the contract claim presented a factual question concerning United's good faith.
3. The District Court properly granted summary judgment for United on the fiduciary-duty claim because, on the undisputed facts, no special relationship or fiduciary duty existed.

Questions Presented

1. Whether the District Court erred in granting summary judgment on the breach-of-contract claim based on the conclusion that PTE and Nickel had defaulted and that United was authorized to freeze their accounts.
2. Whether the District Court erred in granting summary judgment on the claim that United breached the implied covenant of good faith and fair dealing.
3. Whether the District Court erred in determining as a matter of law that no fiduciary or special relationship existed between the plaintiffs and United.

Disposition

reversed_and_remanded