SHIPLET v FIRST SECURITY BANK OF L

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blo. 88-141 IN THE SUPREME COURT O F THE S T A T E O F MONTANA 1988 ROBERT S H I P L E T and J A C Q U E L I N E SHIPLET, P l a i n t i f f s and A p p e l l a n t s , F I R S T S E C U R I T Y BANK O F L I V I N G S T O N , INC., a Montana c o r p o r a t i o n , D e f e n d a n t and R e s p o n d e n t . APPEAL FROM: D i s t r i c t C o u r t of t h e S i x t h J u d i c i a l D i s t r i c t , I n and f o r t h e C o u n t y of P a r k , T h e H o n o r a b l e T h o m a s H o n z e l , Judge p r e s i d i n g . COUNSEL O F RECORD: For A p p e l l a n t : T e r r y Schaplow; Morrow, Montana Sedivy & Bennett, Bozeman, For R e s p o n d e n t : Joe S w i n d l e h u r s t ; H u p p e r t & S w i n d l e h u r s t , L i v i n g s t o n , Montana S i d Thomas; M o u l t o n Law F i r m , B i l l i n g s , M o n t a n a S u b m i t t e d on B r i e f s : Decided: Clerk Aug. S e p t e m b e r 27, 11, 1 9 8 8 1988 J u s e i c e R. Courc. C. Vr. 5fcDonough d e l i v e r e d t h e O p i n i o n o f che Roberc and J a c q u e l i n e S h i p l e c ( S h i p l e c s ) a p p e a l from c h e o r d e r o f r h e D i s c r i c c Courc o f c h e S i x c h J u d i c i a l D i s c r i c r , Park Councy, grancing summary judgmenc S e c u r i c y Rank o f L i v i n q s c o n ( B a n k ) . in favor of Firsc W e affirm. The S h i p l e c s p r e s e n c one i s s u e f o r r e v i e w : Did c h e Discricc Courc err i n g r a n c i n g c h e Rank summary judgmenc on a l l c o u n r s o f c h e complaint? A complece scacemenc o f c h e f a c e s would b e v e r y l e n g r h y . However, oucline an of relevanc and more d e c a i l w i l l sufficient background will evencs be provide g i v e n where The S h i p l e c s o p e r a r e a r a n c h s o u c h o f L i v i n g s c o n . required. They h a v e done b u s i n e s s w i c h c h e Bank f o r a number o f y e a r s , e n r e r i n g i n c o v a r i o u s l o a n agreemencs i n c h e c o u r s e o f c h e i r r a n c h i n g operations. financing for cheir In che S h i p l e r s soughc f u r c h e r 1978, ranch from c h e Rank i n che form o f a $350,000 l o a n . The Bank indicaced chac i could nor make che loan u n l e s s a g u a r a n c y c o u l d b e a r r a n g e d c h r o u g h c h e F a r m e r s Home A d m i n i s c r a c i o n (FmHA). The Bank c h e n submicced a Requesc f o r Guarancee [ s i c ] c o FmHA, which l i s c e d a " L i n e o f C r e d i c C e i l i n g " o f $350,000, a n i n c e r e s c r a c e o f l o % , and a c e r m o f f i v e years. upon ics particular The C o n c r a c c o f Guarancee [ s i c ] i s s u e d by F H mA approval co che of che Shiplecs' application loan orher lisced than rhe cerms no $350,000 credic ceiling. Once che guarancy was S h i p l e c s executed a one-year obtained, che Bank and che p r o m i s s o r y noce f o r 5350,000 a c a n i n c e r e s c r a t e o f 1 0 % . The S h i p l e c s w e r e n o r a b l e c o r e p a y c h e c o c a 1 p r i n c i p a l and i n c e r e s c d u e a f c e r one y e a r , and i n 1979 chey execuced a new one-year noce. This began a cycle of noces, mosc of which were issued for six-monch cerms. The principal and inceresc scill ouescanding as each noce came due were carried over co che new noce. When che 1978 nore came due and ic appeared chae anocher noce would be necessary, che Bank concacced FmHA and asked whecher che cerms of che guarancy would prohibic che Bank from raising che race of inceresr on che loan co reflecc che overall rise in inceresc races caking place ac chac eime. The FmHA replied chac according co ics accorneys, such a race increase was permissible. The 1979 noce carried an inceresc subsequent noces fluccuaced as the prime lending race rose and fell, reaching a peak of 214% in 1981. The FmHA guarancy expired in 1.984, ac which eime pavmencs from che Shiplecs on cheir loan were in arrears. The FmHA decided chac the Rank would have co concinue che Shiplecs' loan wichouc a guarancy or presenc a plan of liquidacion. In February of char year, che Shiplecs and cheir accorney began meecing wich Rank officials to determine whac could be done co resolve che sicuacion. Negociacions resulred in execution of a $400,000 noce and a new, seven-year FmHA guarancy. The condieions accached co the new guarancy included complece repayment of inceresc and operacing credic ar che end of each year, and liquidacion of some Shiplec real escace holdings in order co repay $338,000 When chis final nore reached macuricy on of che loan. Sepcember 28, 1985, approximately $348,000 remained oucscanding. In Occober of 1985, che Shiplecs filed suic againsc che Bank based on che increased ineeresc charged on che pose-1978 noces. They alleged breach of concracc, breach of chird-parcy-beneficiary concracc, bad fairh, fraud, negligenc race of 11.75%. The inceresc race on infliction of emocional dis~ress, breach of fiduciary ducy and economic duress. On January 21, 1988, che Discricc Courc issued an order grancing che Bank's mocion for summary judgmene as co all chirceen councs enurneraced in che Shiplecs' cornplainc. This appeal followed. In order for summary judgrnenc co issue, che moving parcy muse show chere is no genuine issue as co faces chac are macerial in lighc of che subscancive principles enticling chae parcy co judgmenc as a rnaccer of law. If che moving parey meecs chis burden, che non-moving parey chen has che burden of showing a genuine issue of macerial face. These scandards also apply co chis Courc when reviewing che granc or denial of summary judgrnenc. Frigon v. Morrison-Maierle, Inc. (Monc. 1988) - P.2d - 45 Sc.Rep. 1344, and cases , cited cherein. I. The firsc counc of che Shiplecs' complainc alleged breach of concracc. They argued che Bank represenced co chem char the applicacion form for che guarancy was a concracc becween che Bank and che Shiplees for a five-year loan ac an annual inceresc race of 10%. Shiplecs alleged che Bank breached chis concracc by raising che race of inreresc charged on che loan above 10%. The ~iscriccCourc held chis counr failed for a number of reasons, including che applicaeion was noc a concracc Seeween che Bank and che Shiplecs. The courc ruled che concracc becween che cwo parries was evidenced by che 1978 promissory noce for a cerm of one year ac lo%, and any oral represencacions made by che Bank prior co che signing of chac noce merged with che noce's cerms. On appeal, che Shiplecs direcc cwo arguments ac che Discricc Courc's holding. Firsc, chey argue Weinberg v. Farmers Scace Bank of Worden (Monc. 1988), 752 P.2d 719, 45 Sc.Rep. 391, is conerolling in chis case. According KO che Shiplecs, chis Courc held in Weinherg such a concracc exisced in a face sicuacion very similar co chis case. In Weinberg, che farm operacors alleged a seven-year loan agreemenc ac an inceresc race of 93%. Ilowever, in char case boch pareies had signed a promissory noce which on ics face lisced a seven-year rerm and a 94% inceresc race. The only wricing in chis case concaj-ning che cerms alleged by che Shiplecs is che applicacion for guarancy. Thac documenc was signed. only by che Bank's agent, and was direcced co he FmHA. The FmHA and che Bank later execuced a separace concracc of guaraney once che applicacion had been approved. The applicacion was noc a concracc becween che Bank and che Shiplers. As co any oral represencacions by che Bank chac che applicacion was in facr a concracc, che Discricc Courc quoced language from our decision in Firsc Nacional Moncana Bank of Missoula v. McGuiness (Monc. 1985), 705 P.2d 579, 42 Sc.Rep. 1288: [Elvidence of prior oral agreemencs is noc admissible for che purpose of alcering subsequenc wriccen agreemenes dealing wich che same subjecc, and chac ehe prior oral agreemencs and che wriccen agreemenc will merge inco che subsequenc wrircen agreemeniz unless izhey are discincc and can srand independencly of one anocher. 705 P.2d ac 584. Under che doccrine of merger as enunciaced in McGuiness, any oral represencacions made by che Bank merged wich che cerms of che nore, which chen represenced che concracc reached becween chese two parries. The Shiplecs second argumenc is char an exception co che doccrine of merger exiscs for evidence of an oral agreernenc introduced in order co establish fraud. As will be discussed more fully below, any such evidence would be barred by che cwo-year ac 5 scacuce of 1-imicacions f o r fraud-relaced 27-2-203, The MCA. Disrricr Courc c o r c s found was correcc in g r a n c i n g summary judgmenc on c h i s c o u n e . s e c o n d coune a l l e g e d b r e a c h o f The S h i p l e c s ' parry-beneficiary concracc. a chird- They a r g u e d c h e y a r e c h i r d - p a r c y b e n e f i c i a r i e s o f c h e g u a r a n e y c o n c r a c r between c h e Bank and rhe FmHA. On appeal, rhe Shiplecs c o n e r o l l i n g on c h i s i s s u e a s w e l l . found a rejecting scriccly argumenc becween che chac bank concracc che and is Weinberg They a s s e r c c h i s Courc chird-parry-benef i c i a r y rhe argue in guarancy che Weinberg, concracc was Again, che FmHA. d i s c i n g u i s h i n g f a c c o r o f c h e p r o m i s s o r y n o c e i n Weinberg i s o v e r l o o k e d i n c h e S h i p l e c s ' argumenc. I n Weinberg, c h e g u a r a n c y c o n c r a c c was n o r h e l d c o b e a chird-parcy-beneficiary case argued 28-2-905, under che MCA, concracc a s such. the parol noce was evidence evidence The bank i n c h a r rule found only of che ac 5 inicial a d v a n c e s made t o c h e W e i n b e r g s , which had been r e p a i d . The Weinbergs a l l e g e d c h e noce was e v i d e n c e o f a n agreemenr f o r a line of credir lascing seven years. VJe held che parol e v i d e n c e r u l e d i d n o c a p p l y , b e c a u s e t h e Weinbergs were noc a ~ c e m p c i n g c o v a r y c h e cerms o f c h e n o c e . They w e r e i n s c e a d b a s i n g c h e i r argumenc on c e r m s found on c h e n o c e ' s f a c e . n here fore a p p l i e d S 28-3-402, MCA, We which a l l o w s e v i d e n c e o f c h e c i r c u r n s c a n c e s u n d e r which a n agreemenc i s made i n o r d e r t o e x p l a i n , b u r noc m o d i f y , i c s cerms. The guaraney conrracc in Weinberg was one piece of e v i d e n c e showing e h e c i r c u r n s c a n c e s s u r r o u n d i n g c h e e x e c u r i o n of che noce. The documencs u s e d i n p r o c u r i n g c h e g u a r a n e y and c h e b a n k ' s s u b s e q u e n c a c c i o n s i n r e l i a n c e on c h e g u a r a n c y c o n c r a c c a l l p e r c a i n e d c o whac c h e bank and c h e Weinbergs had i n mind when chey e x e c u c e d c h e noce. U n l i k e Weinberg, c h e S h i p l e e s a r e n o c s e e k i n g c o e n f o r c e c h e cerms o f c h e i r noce wich c h e Bank. Inscead, rhey seek e n f o r c e t h e guarancy concracc i c s e l f . The D i s e r i c c C o u r c ' s cicacion v. KO KO che Souch Dakoca Supreme Coure d e c i s i o n i n S w i e r Norwesc Bank (S.D. 121, i s persuasive. 1 9 8 7 ) , 409 N.W.2d The l o a n i n c h a c c a s e was a n F H emergency l i v e s c o c k l o a n , mA c h e same k i n d o f l o a n i n v o l v e d i n c h i s c a s e . Such l o a n s a r e ec g o v e r n e d by r e g u l - a c i o n s found a c 7 CFR 5 s 1980.201 - seq, which d o n o r p r o h i b i c a bank from r a i s i n g c h e i n c e r e s c r a c e c h a r g e d on a l o a n d u r i n g c h e l i f e o f c h e g u a r a n c y . r a i s i n g c h e r a r e i c c h a r g e d c h e S h i p l e c s , c h e Bank che F H mA co concracc, find our: and was if cold chis would violace chac correctly Before C O ~ K ~ C K ~ ~ che i c would guarancy nor. Discricc Coure was c o r r e c c i n g r a n c i n g summary judgmenc The on c h i s counc. 111. The chird counc of che Shiplecs' complainc alleged b r e a c h o f c h e s c a c u c o r y o b l i g a c i o n o f good f a i c h found i n Uniform Commercial 30-1-203, code MCA, Code scaces, imposes an 30-1-202 ( 1 9 ) , MCA, as adopced in Mon~ana. he Secrion " [ e l v e r y c o n c r a c c o r ducy w i t h i n c h i s obligacion of good faich," and 5 s c a c e s c h a r "good f a i c h " means h o n e s e y i n face. The S h i p l e c s ' argumenc on a p p e a l s c a c e s b a s i c a l l y c h a c chere is ample evidence r e p r e s e n c a c i o n s made appears from experienced our KO of dishonesry in a number While i c chem by c h e B a n k ' s a g e n c . review of difficulties in che record dealing char wich che che of Shiplecs Rank, che evidence before u s does nor supporc a v i o l a c i o n of scacucory good f a i c h . Moncana c a s e law on c h i s s u b j e c c i s s c a r c e . However, b e c a u s e t h e s c a c u c o r y p r o v i s i o n s c i c e d above a r e p a r e o f c h e Uniform Commercial Code, w e a r e a f f o r d e d c h e o p p o r c u n i c y look KO decj-sions in ocher scaces incerprecing KO virtually provisions. identical From our reading T h i r d N a c i o n a l Rank i n N a s h v i l l e v . Illinois, Bank o f (Ga. Inc. Tenn. (M.D. Savannah v . cases Hardi-Gardens such a s Supply of 930; and ~ i r s c 1 . 9 7 4 ) , 380 F.Supp. Kilpacrick-Smich 1.980), 264 S.E.2d of C o n s c r u c c i o n Co., Inc. i c a p p e a r s c h e gravamen o f c h e 576, s c a c u c o r y good f a i c h requirement i s whecher c h e cerms o f c h e agreernenc w e r e c a r r i e d o u c faithfully. Our review of che r e c o r d b e f o r e u s shows c h e v a r i o u s n o c e s e v i d e n c i n g agreernenc becween c h e Bank and r h e S h i p l e c s w e r e i n f a c e c a r r i e d o u r by c h e Bank. w e r e advanced a c c h e r a c e s parcies. Scacemencs made The monies a g r e e d upon a g r e e d upon by che i n w r i c i n g by boch Bank's agenc, while nor a l w a y s s c r i c c l y f o r c h r i g h ~ , d i d noc d e p r i v e S h i p l e c s o f c h e benefic of che bargains chey scruck wich che Bank. The D i s c r i c c Courc was c o r r e c c i n g r a n c i n g summary judgmenc on r h i s counc. IV. The S h i p l e c s ' f o u r c h c o u n c a l l e g e d b r e a c h o f c h e i m p l i e d covenanc of good faich and fair dealing. The Discrice C o u r c ' s r u l i n g c i c e d a u c h o r i c y from c h i s Courc r e q u i r i n g c h a r a breach of concracc muse "impermissible accivicy" before be rhe resulc of some r h e breaching parcy can be h e l d c o h a v e a l s o b r e a c h e d c h e i m p l i e d c o v e n a n c o f good f a i c h and f a i r d e a l i n g . S e e , Noonan v . F i r s c Bank Bucce ( M o n ~ . 1 9 8 7 ) , 740 P.2d 631, Sc.Rep. 44 1124; Nordlund D i s c r i c c No. 1 4 (MoIIK. Nicholson v. Uniced P a c i f i c I n s u r a n c e Co. P.2d 1 3 4 2 , 4 2 Sc.Rep. The Shiplecs v. 1 9 8 7 ) , 738 P.2d 1 2 9 9 , 4 4 Sc.Rep. (Mone. School 1183; 1 9 8 5 ) , 710 1822. seek co discinguish chis auehoricy by n o c i n g i n N i c h o l s o n we h e l d a b r e a c h o f c o n c r a c c was n o r a prerequisite c o b r e a c h o f c h e c o v e n a n c , because che implied c o v e n a n c o f good f a i c h i s noc a n obligation a r i s i n g from c h e concracc i c s e l f . Nicholson, 710 P.2d a c 1348. While c h i s i s c r u e , w e a l s o s e a c e d c h e obligation imposed by c h e c o v e n a n c is co ace reasonably. Under c h i s s c a n d a r d , we have h e l d c h e "minimal r e q u i r e m e n c " f o r b r e a c h o f c h e c o v e n a n c i s a c c i o n by che defendanc char i s " a r b i c r a r y , c a p r i c i o u s o r unreasonable, and exceeded juscifiable plaintiffs' defendanc a c e reasonably]." expeccacion [ c h a r che Noonan, 740 P.2d a c 6 3 5 . I n c h i s c a s e , c h e S h i p l e c s had a j u s c i f i a b l e e x p e c c a c i o n c h a c c h e Bank would a c e r e a s o n a b l y by l o a n i n g rhem money on c h e cerms a g r e e d upon i n c h e n o c e s . was done. A s w e found a b o v e , chis The e v i d e n c e adduced by c h e S h i p l e c s f a i l s c o show a r b i c r a r y o r u n r e a s o n a b l e conduce by c h e Bank. The Discricc Courc was c o r r e c c i n g r a n r i n g summary judgment. v. Councs five ehrough nine of che v a r i o u s forms o f f r a u d and f r a u d - r e l a c e d Courc r u l e d complainc cores. alleged The D i s c r i c c c h e s e c l a i m s w e r e b a r r e d by Montana's cwo-year s c a c u c e o f l i m i c a c i o n s f o r a c c i o n s b a s e d on f r a u d o r m i s c a k e found a c S 27-2-203, MCA. On a p p e a l , c h e S h i p l e c s concend ehey had d e v e l o p e d a c o n f i d e n c i a l r e l a c i o n s h i p wich c h e Bank s i m i l a r t o c h a c found by c h i s Courc i n Weinberg, which r o l l - e d che scacuce o f l i m i c a e i o n s . The e x i s t e n c e o f a c o n f i d e n c i a l r e l a c i o n s h i p , i s noc a n i s s u e h e r e . however, The a u t h o r i c y c i c e d b 7 S h i p l e c s f o r 5 c h e proposition c h a r c h e s c a c u c e was c o l l e d i n c h i s c a s e i s 37 Am J u r 2d F r a u d and D e c e i c S 4 0 9 : Where a c o n f i d e n c i a l r e l a c i o n s h i p e x i s c s becween che p a r e i e s , f a i l u r e c o d i s c o v e r f a c e s conscicucing f r a u d may be e x c u s e d . The basis represenced of KO che complainc is char che Bank chem it would l o a n chem money a c a r a c e o f 1 0 % over a period of January of Shiplecs' 1978, five years, the Shiplecs a n d chen d i d n o r d o s o . signed a noce chac d i d In noc contain the alleged five-year c e r m . Tn J a n u a r y of 1 9 7 9 , chey s i g n e d a noce c h a t c o n c a i n e d n e i t h e r t h e a l l e g e d c e r m , che a l l e g e d i n c e r e s c r a c e . They had a c c h a r p o i n c certainly discovered faces s u f f i c i e n c t o conscicuce fraud. no failure co discover confidencial nor faces, relacionship T h e r e was and therefore no n e e d f o r a argumenc. The Discrice Courc' s r u l i n g was c o r r e c c . VI The S h i p l e c s ' of emocional . c e n c h c o u n c a l l e g e d negligent i n f l i c c i o n discress. Negligent d i s c r e s s i s a narrowly-defined infliccion of c o r c i n Montana. emocional W e see o u r c h e cesc f o r c h i s c o r c i n V e r s l a n d v . Caron T r a n s p o r c ( 1 9 8 3 ) , 206 Monc. 313, 671 P.2d 583, by r e q u i r i n g a n e m o c i o n a l i m p a c t resuleing from direcc observance injury of a close relacive. of the deach or serious Thac s i c u a c i o n c l e a r l y i s nor: p r e s e n e h e r e , and c h e counc i s t h e r e f o r e a c l e a s e m i s l a b e l e d . The body of c h i s counc, and che Shiplecs' subsequenc argumencs c o c h e D i s t r i c c Courc and c h i s C o u r c , u s e l a n g u a g e adopced Inc. S u p e r s a v e Markecs, from o u r d e c i s i o n i n Johnson v . (Monc. 1 9 8 4 ) , 686 P.2d 209, 4 1 Sc.Rep. 1495, concerning e m o c i o n a l d i s c r e s s a s a n elemenc o f damages r e s u l t i n g from a corc. We a r e h e r e a f f i r m i n g c h e Discricc C o u r c ' s g r a n c o f summary judgmenc i n f a v o r o f c h e Bank on a l l c o u n c s l i s c e d i n 7;he S h i p l e c s ' complainc. Therefore w e need noc r e a c h che i s s u e o f damages. VII. The e l e v e n e h counc o f t h e c o m p l a i n c a l l e g e d p r o m i s s o r y noLe b r e a c h o f c o n c r a c c . The S h i p l e c s and t h e Bank a l l e g e d l y a g r e e d i n c e r e s c would b e d u e a c m a c u r i c y , paymencs a p p l i e d t o p r i n c i p a l . wich a l l i n c e r i m The S h i p l e c s a l l e g e c h e Bank p a r c i a l l y m i s a p p l i e d some i n c e r i m paymencs c o i n c e r e s c . Boch p a r c i e s a g r e e c h e Discrice Courc correctly s c a r e d t h e g e n e r a l r u l e c h a r i n c e r i m paymencs on a d e b c a r e n o r m a l l y a p p l i e d f i r s c co accrued i n c e r e s c . S h i p l e c s a r g u e , however, c h e cescimony o f e h e B a n k ' s e x p e r c w i c n e s s c r e a e e d a g e n u i n e issue macerial of rule. The inceresc would face a s Bank's be co a experc due possible cescified excepcion che provision a c m a c u r i c y meanc, in his i n c e r i m payrnencs would b e a p p l i e d c o p r i n c i p a l . a l s o p o i n c o u c c h a e cwo o f che noces co che chat opinion, The S h i p l e c s s c a r e e a r l y paymencs would b e a p p l i e d c o p r i n c i p a l . A r e c e n c scacemenc o f c h e g e n e r a l r u l e on a p p l i c a c i o n o f i n c e r i m payrnencs i s found. a c 4 5 Am J u r 2d I n c e r e s c and TJsury S 99. Known a s c h e "Uniced S c a r e s R u l e , " i c p r o v i d e s i n c e r i m payrnencs a r e f i r s c a p p l i e d c o a c c r u e d i n c e r e s c u n l e s s c h e r e is a s c a c u c e o r a n agreernenc c o c h e contrary. Shuccs v . P h i l l i p s Pecroleum Co. See, (Kan. 1 9 8 7 ) , 732 p.2d e.g., 1286. Neicher excepeion i s presene i n c h i s case. Lack of is payrnencs an agreernenc evidenced by as che co applicacion Shiplecs' of own b r i e f incerim co chis Courc. They concend chey have a l w a y s a s k e d c h a r payrnencs b e applied firsc co p r i n c i p a l , buc che Rank's " c h e y ' d d o whacever chey wane c o w i c h i c . " no scacuce in Moncana payrnencs c o p r i n c i p a l . diceacing r e p l y h a s been There i s l i k e w i s e applicacion of incerim Furcherrnore, c h e noce l a n g u a g e c i c e d by c h e S h i p l e c s s c a r i n g e a r l y payrnencs would be a p p l i e d c o p r i n c i p a l was preceded. by he c a v e a r c h a r s u c h e a r l y payrnencs would noc r e l i e v e c h e d e h c o r o f c h e duey c o c o n c i n u e making payrnencs u n d e r c h e a g r e e d paymenc s c h e d u l e . This language therefore d e a l s wiizh paymenes made o u c s i d e ~ h normal c o u r s e e of che loan, noc regular incerim paymenes. The Discrice Courc was c o r r e c e i n g r a n c i n g summary judgmenc on c h i s c o u n c . VIII. Counc fiduciary cwelve duey of arising che complaint from che becween c h e S h i p l e c s and c h e Bank. alleged confidencial breach of relacionship On a p p e a l , c h e S h i p l e c s again argue che situation here is analogous co chat in Weinberg, where a confidencial relacionship was found. Shiplecs also cice our decision in Deisc v. Wachholz (Monc. 1984), 678 P.2d 188, 41 Sc.Rep. 286, for che proposition char a confidencial relacionship can exisc becween a bank and ics customer in cercain sicuacions. In Deisc, we began wich che general rule chac a bank-cuscomer relacionship does not ordinarily give rise co fiduciary responsibilities. However, we found an excepcion co chis general rule when special circumscances are presenc. che In D ~ ~ s K , plaintiff and her deceased husband had banked wich che defendanc for over 20 years. After che husband's deach, che bank had caken an accive advisory role in che plaintiff's finances, and she had relied on char advice. Deisc, 678 P.2d ac 193-94. Likewise in Weinberg, we found a confidencial relacionship where che bank "parccipaced in and encouraged the changes co be made regarding che Weinbergs' farming operacion." Weinberg, 752 P.2d ac 731. One celling faccor distinguishes chis case from Deisc and Weinberg. The Shiplets did nor place such greac reliance on che Bank's advice. The Shiplecs felt chey knew more abouc ranching chan did che Bank's agenc. While che Bank advised che Shiplecs on the operacion of cheir ranch, char advice was noc always heeded. For example, chey refused co wichdraw from che FmHA guarancy program when advised co do so in 1979, and even refused to sell land when required to do so by che condicions of che seven-year FmHA guarancy issued in 1984. Furehermore, chey were represented by counsel during che 1984 negociacions. No special circumscances are presenc in chis case co create an excepcion co che general rule char a bank's relacionship wich ics cuseomer is noc a confideneial. one. The Discricc Courc was correcc in grancing summary judgmen~ on chis counc. IX. The Shiplecs final c0un.c alleged Economic Duress, in ~ h a cche Bank's agenc chreacened foreclosure when he had no legal righc co do so. Shiplees advance chis argumene again on appeal, scacing che Rank's unwarranced foreclosure chreacs descroyed cheir free agency and lefc chem wich no choice buc co sign che noces. The Shiplecs' argumene on chis counc fails for much rhe same reason as cheir argumene concerning breach of fiduciary duey. Economic duress, also known as "business compulsion," concerns che making of conrraccs under circumscances showing a lack of free will on che pare of one of che concraccing parries. However, [economic duress] is noc established merely by proof char consent was secured by che pressure of financial circumscances, or by che face char one parcy insisced upon a legal righc and che ocher parry yielded co such insistence. 25 Am Jur 2d Duress and Undue Influence § 7. The record before us shows che noces ac issue represenred an indebcedness incurred ac che requesc of che Shiplecs. They were unable co repay even che firsc note completely, and wich each new note, the indebcedness compounded. The Shiplecs' claims chac chey had no choice bur co sign chese noces seem nor from some unlawful chreac by rhe Bank, bur from che pressure of cheir mouncing debc. True, had chey nor signed che noces, the Bank could have "pue chem ouc of business," bur chis would have been chrough foreclosure, rhe Bank's lawful remedy for failure of repaymenc. The Discricc Courc was correcc in grancing summary judgment on chis counc. We a f f i r m t h e o r d e r o f the D i s t r i c t Court. Re& Justice We Concur: Justices 6'

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