author: JUSTICE NELSON

text:
    KATHARINE S. BOREEN, Plaintiff and Appellant, v. GEORGE CHRISTENSEN, a/k/a GEORGE P. CHRISTENSEN, a/k/a “CHRIS” CHRISTENSEN, and F. GUY YOUNGBLOOD, acting individually and in the capacities of administrative officers of the DEPARTMENT OF MILITARY AFFAIRS, STATE OF MONTANA, Defendants and Respondents.
    No. 93-616.
    Submitted on Briefs July 26, 1994.
    Rehearing Denied Nov. 22, 1994.
    Decided October 20, 1994.
    51 St.Rep. 1014.
    267 Mont. 405.
    884 P.2d 761.

      For Appellant: Peter Michael Meloy, Meloy & Morrison, Helena.
    For Respondent: Hon. Joseph P. Mazurek, Attorney General, James Scheier, Assistant Attorney General, Helena.
    For Amicus: Stanley T. Kaleczyc, Browning, Kaleczyc, Berry & Hoven, Helena (Montana League of Cities and Towns and Montana Association of Counties).
   JUSTICE NELSON

delivered the Opinion of the Court.

This is an appeal from an order of the First Judicial District Court, Lewis and Clark County, dismissing the complaint of plaintiffiappellant Katharine S. Boreen (Boreen) alleging constructive discharge from her employment and violations of 42 U.S.C. §§ 1983 (§ 1983) and 1988. We reverse and remand.

The sole issue on appeal is whether the District Court erred in dismissing Boreen’s complaint for failure to state a claim on which relief can be granted because she did not have a property interest in her employment and, therefore, no due process rights under the Fourteenth Amendment.

FACTUAL BACKGROUND

Boreen’s complaint alleges that she was employed by the Montana Department of Military Affairs until she was terminated on April 13, 1990. The complaint states that George Christensen (Christensen) and F. Guy Youngblood (Youngblood) “render[ed] her working conditions so intolerable that a reasonable person under the circumstances would have no other choice but to resign.” She further alleges that, by virtue of the personnel policies of the State of Montana, she could not be terminated (constructively discharged) without just cause, and that she had a property interest in her employment by reason of these policies.

Christensen and Youngblood were administrative officers at the Montana Department of Military Affairs who, according to Boreen, “acting as individuals, and acting under color of state law, in their capacities as administrative officers of the Department of Military Affairs” deprived her of her property interest in employment by constructively terminating her without due process of law. She sought an award of compensatory and general damages and attorney fees.

PROCEDURAL BACKGROUND

Boreen filed her complaint on April 5, 1993. On July 2, 1993, Youngblood filed a motion to dismiss the complaint and for a protective order. The District Court heard argument on the motion to dismiss and protective order and granted leave to file an amended complaint on July 7, 1993. On July 19, 1993, Youngblood filed an answer to the amended complaint, stating that the complaint failed to state a claim upon which relief could be granted. He also filed a motion to dismiss the amended complaint as well as a motion for summary judgment. Counsel for both parties argued the motion to dismiss and for summary judgment on August 26,1993. On November 16,1993, the District Court issued its order, granting the motion to dismiss, concluding that Boreen had no property interest in her state employment and therefore, had failed to state a claim under § 1983. This appeal followed.

STANDARD OF REVIEW

Our standard of review of district court rulings on motions to dismiss under Rule 12(b)(6), M.R.Civ.P., is set forth in Willson v. Taylor (1981), 194 Mont. 123, 634 P.2d 1180:

A complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. A motion to dismiss under Rule 12(b)(6), M.R.Civ.P., has the effect of admitting all well-pleaded allegations in the complaint. In considering the motion, the complaint is construed in the light most favorable to the plaintiff, and all allegations of fact contained therein are taken as true.

Willson, 634 P.2d at 1182. (Citations omitted.) The District Court’s determination that Boreen’s complaint failed to state a claim is a conclusion of law. Our standard of review of the trial court’s conclusions of law is whether the tribunal’s interpretation of the law is correct. Steer Inc. v. Department of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d 601, 603.

PROPERTY INTEREST IN EMPLOYMENT

Boreen contends that the personnel policies of the State of Montana provide her with a property interest in continued employment of which she cannot be deprived without due process of law and which is sufficient to trigger the remedial protection of § 1983. Those personnel policies, found in Title 2, Chapter 21, sub-chapter 65 of the Administrative Rules of Montana (ARM) are set forth in pertinent part as Appendix Ato this opinion.

The State counters that Boreen was an “at will” employee and that, pursuant to § 39-2-503, MCA, and applicable case law, she has no property interest in continued employment. The State further contends that the “just cause” provisions in its personnel, policies on which Boreen bases her claim do not create a property interest in employment.

Boreen argues, and we agree, that the United States Supreme Court’s decision in Cleveland Board of Education v. Loudermill (1985), 470 U.S. 532, 105 S.Ct. 1487, 84 L.Ed.2d 494, and other pertinent case law, should serve as our guide in deciding this issue of first impression — whether the “just cause” provisions of the administrative regulations which comprise the personnel policies of the State of Montana create a property interest in employment sufficient to trigger the due process protections afforded by the Fourteenth Amendment of the United States Constitution and the remedial protections afforded under § 1983.

LOUDERMILL

Loudermill involved a security guard’s challenge to his dismissal by the Cleveland Board of Education. On his job application Louder-mill erroneously stated that he had never been convicted of a felony. Subsequently, on discovering that he had been convicted of grand larceny, the Board dismissed him for dishonesty in filling out his job application.

In his suit in federal district court, Loudermill claimed that his due process rights were violated because he was discharged without an opportunity to respond to the charges against him and to challenge his dismissal prior to his removal from his position. Under Ohio law, Loudermill was a “classified civil servant” subject to termination only for cause and with the right to obtain administrative review upon discharge from employment. Loudermill reached the United States Supreme Court with a companion case presenting the same issue involving Donnelly, a bus mechanic employed by the Parma Board of Education.

In reviewing the precedential underpinnings for its decision, the Loudermill Court set forth certain basic legal principles that govern the application of due process protection to employment termination cases:

Respondents’ federal constitutional claim depends on their having had a property right in continued employment. Board of Regents v. Roth, 408 U.S. 564, 576-578 [92 S.Ct. 2701, 2708-10, 33 L.Ed.2d 548] (1972); Reagan v. United States, 182 U.S. 419, 425 [21 S.Ct. 842, 845, 45 L.Ed.2d 1162] (1901). If they did, the State could not deprive them of this property without due process. See Memphis Light, Gas & Water Div. v. Craft, 436 U.S. 1, 11-12 [98 S.Ct. 1554, 1561-62, 56 L.Ed.2d 30] (1978); Goss v. Lopez, 419 U.S. 565, 573-574 [95 S.Ct. 729, 735-36, 42 L.Ed.2d 725] (1975).
Property interests are not created by the Constitution, “they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law. ...”
Board of Regents v. Roth, supra, 408 U.S. at 577, 92 S.Ct. at 2709. See also Paul v. Davis, 424 U.S. 693, 709 [96 S.Ct. 1155, 1164, 47 L.Ed.2d 405] (1976).

Loudermill, 470 U.S. at 538, 105 S.Ct. at 1491.

Concluding that the Ohio statute at issue created such a property interest, the court observed that Loudermill was a “‘classified civil service employe [e],’ entitled to retain [his] positio[n] ‘during good behavior and efficient service,’ who could not be dismissed ‘except... for ... misfeasance, malfeasance, or nonfeasance in office.’ ” (Citation omitted.) This statute, the court determined, supported the conclusion that Loudermill had a property interest in his continued employment by the school district.

Rejecting outright the position of the plurality in Arnett v. Kennedy (1974), 416 U.S. 134, 94 S.Ct. 1633, 40 L.Ed.2d 15, thatthe employee’s property right is defined by, and conditioned on, the legislature’s choice of procedures for its deprivation, the Loudermill court stated:

... the Due Process Clause provides that certain substantive rights — life, liberty, and property — cannot be deprived except pursuant to constitutionally adequate procedures. The categories of substance and procedure are distinct. Were the rule otherwise, the Clause would be reduced to a mere tautology. “Property” cannot be defined by the procedures provided for its deprivation any more than can life or liberty. The right to due process “is conferred, not by legislative grace, but by constitutional guarantee. While the legislature may elect not to confer a property interest in [public] employment, it may not constitutionally authorize the deprivation of such an interest, once conferred, without appropriate procedural safeguards.”

Loudermill, 470 U.S. at 541, 105 S.Ct. at 1493. (Citation omitted.)

The court then proceeded to delineate what administrative process was due Loudermill according to the due process guarantees of the federal constitution and prior case law. The court concluded that due process simply required oral or written notice to the employee with an explanation of the employer’s evidence and the opportunity for the employee to respond in “something less” than a full evidentiary hearing before termination, coupled with a full post-termination hearing “at a meaningful time.” Loudermill, 470 U.S. 546-47, 105 S.Ct. at 1495-96. As stated by the court,

[h]ere, the pretermination hearing need not definitively resolve the propriety of the discharge. It should be an initial check against mistaken decisions — essentially, a determination of whether there are reasonable grounds to believe that the charges against the employee are true and support the proposed action.

Loudermill, 470 U.S. at 545-46, 105 S.Ct. at 1495. (Citation omitted.)

MONTANA CASE LAW

While this Court has dealt with the termination of “at will” employment in the context of claims alleging violations of due process, we have not yet addressed the issue presented here — whether an administrative regulation can create a property interest in continued employment sufficient to trigger the due process protections afforded by the Montana Constitution and the Fourteenth Amendment of the federal constitution, remedial under § 1983. The two primary Montana cases cited by both parties which impact this issue are: Reiter v. Yellowstone Cty. (1981), 192 Mont. 194, 627 P.2d 845, and Medicine Horse v. Big Horn Cty. Sch. D. (1991), 251 Mont. 65, 823 P.2d 230. Two recent federal court decisions, Stokes v. Lamma (D. Mont. 1993), CV-93-016-GF, an unpublished decision of the United States District Court of Montana — Great Falls and Hollister v. Forsythe (9th Cir. 1994), 22 F.3d 950, are also cited and argued by the parties, and will be discussed.

In Reiter, an employee who had been a custodian for the Yellowstone County Courthouse, was discharged without a hearing and subsequently brought an action in the district cotut seeking reinstatement and back pay. Reiter argued that because he had served in his position for a long time and was a permanent employee, he had a property interest in continued employment and was entitled to procedural due process before termination. Relying on Perry v. Sindermann (1972), 408 U.S. 593, 602, 92 S.Ct. 2694, 2700, 33 L.Ed.2d 570, (an employee “who ha[d] held [a] position for a number of years, might be able to show from the circumstances of this service — and from other relevant facts — that he has a legitimate claim of entitlement to job tenure ...,”) Reiter claimed that his longevity of service, supervisory position, retirement and insurance benefits, and the promise of a hearing upon discharge were factors which gave him a ‘legitimate claim of entitlement to continued employment.” Reiter, 627 P.2d at 848.

This Court concluded that the “at will” statute, § 39-2-503, MCA, which stated that “[a]n employment having no specified term may be terminated at the will of either party on notice to the other ...” was controlling. We held that, “[t]he Montana statute create [d] no property interest in employment if there [was] no specified term” and, therefore, Reiter had no property interest protected by the United States and Montana Constitutions. Reiter, 627 P.2d at 849-50.

Moreover, in response to Reiter’s contention that the implied covenant of good faith and fair dealing created a property interest in employment sufficient to trigger the necessity for due process procedures, we concluded that this argument could not circumvent the “at will” statute which “clearly denies his claim of entitlement to continued employment.” Reiter, 627 P.2d at 849. We stated:

Even though appellant may have had an implied contract with the county by virtue of his longevity of service, it would be a contradiction in terms to say that he had an “implied specified” period of employment. A specified term is one which the parties expressed, and there was no expression here concerning the length of employment. Section 39-2-503, MCA, operates to fill the gap left by the parties by defining the relationship as an “at-will” employment. While the rule may well be outdated, it is uniquely a province of the legislature to change it.

Reiter, 627 P.2d at 849.

Importantly, Reiter did not raise, nor did we address, the effect on the “at will” nature of the plaintiff’s employment of the parties conditioning termination on a demonstration of “just cause” under an administrative regulation adopted by the government. In fact, we specifically pointed out that Reiter’s employment “was not covered by any written contract or collective bargaining agreement or ordinance.” Reiter 627 P.2d at 847.

In Medicine Horse, citing our holding in Reiter that the employee "... had no property interest in his position by virtue of his years of service, absent a contractually specified term of employment,” we held that, failing to present a written contract, state law or regulation stating or otherwise indicating that he had a property interest in his position as custodian, Scott Medicine Horse was an “at will” employee without a constitutionally protected property interest in his continued employment. Medicine Horse, 823 P.2d at 233.

Medicine Horse, employed by the Big Horn County School District for four years, was involved in a number of work-related problems which culminated in his discharge by the Board of Trustees at a meeting on December 20, 1988. He requested a hearing after being informed of the termination. The hearing took place on January 17, 1989, but the trustees did not take action after the hearing, and the discharge remained in effect.

Medicine Horse appealed the discharge until it reached the District Court on a petition for judicial review under the Montana Administrative Procedure Act. He contended on appeal that he should have been provided with written notice of the reasons for his termination and that he should have received a pre-termination hearing. Medicine Horse asserted that he was a permanent employee and, thus, had a property interest in continued employment. The Board maintained that he was an “at will” employee, had notification of the board’s consideration of his termination and was provided with a post-termination hearing even though it was discretionary with the trustees.

We agreed with the Board and concluded that Medicine Horse was an “at will” employee because his term of employment had no specific duration. We quoted Board of Regents v. Roth (1972), 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548, for the proposition that “[a] property interest in one’s position must be created by existing rules or regulations, state laws, or understandings between employee and employer.” Medicine Horse, 823 P.2d at 233. We then concluded that Medicine Horse was not entitled to a pre-termination hearing because he could present"... no written contract, state law, or regulation specifically stating or otherwise indicating that he had a property interest in his position as a custodian.” Medicine Horse, 823 P.2d at 233.

In so holding, we rejected various arguments presented by Medicine Horse in support of his position. We disagreed that the written policy applicable to his position created a property interest. We concluded that, under the policy, he could be “terminated at any time and that a hearing may be provided... at the discretion of the trustees ... [and that the] policy does not support the appellant’s claim of a property interest in his position.” Medicine Horse, 823 P.2d at 233. We also rejected Medicine Horse’s contention that he gained a property interest in his employment by passing his probationary period and that, having done so, he reasonably expected that his employment would continue. Medicine Horse, 823 P.2d at 233-34. Finally, we disagreed with Medicine Horse’s contention that “at will” employment was not a viable doctrine in Montana, stating that “neither [the Wrongful Discharge From Employment Act] nor any other action by the Montana Legislature or this Court has nullified the ‘at will’ designation or § 39-2-503, MCA.” Medicine Horse, 823 P.2d at 232.

Notwithstanding the various arguments which we rejected, a careful reading of Medicine Horse reveals that, as in Reiter, we did not rule on the issue presented in the instant case. To the contrary, our decision in Medicine Horse, specifically left for future resolution the case where, unlike Medicine Horse, a plaintiff did present"... [a] state law, or regulation specifically stating or otherwise indicating that he had a property interest in his position. ...” Medicine Horse, 823 P.2d at 233.

THE INSTANT CASE

We are, here, faced with that case — an employee who does point to specific administrative regulations which state that disciplinary actions, such as termination of employment, must be conditioned upon “just cause” and that due process procedures, including notice and an opportunity to respond, must be followed as a part of the disciplinary action or termination.

In the instant case, the District Court stated that because Medicine Horse held that an at will employee did not have a property interest in continued employment and that the WDFEA did not alter the statutory at will definition, the WDFEA would not provide Boreen with a property interest in employment. The District Court stated that the federal district court’s decision in Stokes, relying on Medicine Horse, held that the WDFEA did not create a property interest in employment by imposing the good cause requirement on the termination of an at will employee. The District Court then concluded that if the WDFEA did not create a property interest in continued employment, administrative regulations could not create such a property interest either.

The problem with that reasoning is that, as discussed in some detail below, Stokes did not correctly interpret our prior case law, nor have we addressed directly the issue of whether the WDFEA creates a property interest in continued employment through the good cause requirement of § 39-2-904(2), MCA. That precise issue, moreover, is not presently before this Court, and we are not deciding that question in this case.

What is at issue are administrative regulations of the Department of Military Affairs — the State of Montana — which mandate that disciplinary action against its employees, including discharge, be taken only for “just cause,” as defined, and then, only in accordance with the procedures set forth in such regulations. We conclude that the regulations at issue here support Boreen’s argument that she had a property interest in her continued employment. We further conclude that these regulations do provide Boreen with a specified term of employment. Under the regulations, Boreen was entitled to remain in her position of employment until there was “just cause” for her termination. While Boreen’s term of employment may not have been expressed in days, months or years, it was, nevertheless, expressed in relation to a definite period of time during which Boreen could reasonably expect her employment to continue — i.e., until her employer established one of the defined “just cause” reasons why her employment should end. Here, the administrative regulations of the State confer upon employees such as Boreen, a specified term of employment and, in turn, create a property interest in the continuation of that employment, absent a demonstration by the employer of just cause why the employment should be terminated. Medicine Horse, 823 P.2d at 233.

Moreover, our conclusion that the administrative regulations at issue provide Boreen with a property interest in continued employment does not nullify the at will statute. We simply conclude that Boreen is not an at will employee — i.e., one whose employment has no specified term, or, as we indicated in Scott v. Eagle Watch Investments Inc. (1991), 251 Mont. 191, 828 P.2d 1346, one who is subject to discharge “for a good reason, bad reason, or for no reason at all.” Scott, 828 P.2d at 1349.

As we stated in Dare v. Montana Petroleum Marketing Co. (1984), 212 Mont. 274, 687 P.2d 1015, under certain facts, “the term of employment... [may go]... beyond the indefinite period contemplated in the at will employment statute, § 39-2-503, MCA, and ... [be] ... founded upon some more secure and objective basis.” Dare, 687 P.2d at 1020. Unlike Reiter and Medicine Horse, who could point to no contract, statute or regulation protecting their employment, Boreen is covered by regulations that do protect her employment. While Reiter and Medicine Horse did not have a specified term of employment and thus, no entitlement to continued employment, Boreen is entitled to remain in her job until her employer establishes “just cause” that she should be terminated. While Reiter and Medicine Horse were simply employees at will, Boreen’s employment has gone beyond the indefinite period contemplated in the at will employment statute, and is founded upon the “more secure and objective basis” of “just cause” mandated by the State’s personnel policies. See Dare, 687 P.2d at 1020. Boreen can only be terminated for “just cause;” she may not be terminated for a bad reason or no reason at all. Scott, 828 P.2d at 1349. Simply put, Boreen is not an at will employee. Absent such an interpretation, the requirements of the regulation would be meaningless and illusory and would afford the employee little, if any, protection from or remedy for discharge without “just cause.” Our decisions in Medicine Horse and Reiter, which interpret § 39-2-503, MCA, are not affected by this ruling; a careful reading of those cases, in fact, suggests our decision here.

In summary, we hold, that where, as here, the government employer has, by administrative regulation, limited its ability to impose on its employee the ultimate form of discipline, i.e., discharge, absent a showing of “just cause,” as defined in the regulation, then the employer has, by such regulation, abrogated the “at will” employment relationship. Rather, the regulation creates a specified term of employment. Therefore, the employee is entitled to expect that his employment will continue until the employer demonstrates “just cause” why the employee should be discharged. Moreover, we hold that such a regulatory scheme creates a property interest in the employee’s continued employment which is protected by the due process provisions of the federal and Montana Constitutions.

As mentioned above, following Medicine Horse, two federal courts, interpreting the decisions of this Court, ruled that the affected Montana employee had not demonstrated a constitutionally protected property interest in continued employment. Inasmuch as Stokes is referred to by the District Court in its decision and both Stokes and Hollister are raised and vigorously argued in the briefs, we will discuss those two opinions. In so doing, however, we emphasize at the outset that we are not constrained by the interpretations placed upon our decisions by the federal judiciary, and, as indicated by our opinion here, we necessarily do not agree with the conclusions of the federal courts involved.

In Stokes, an action filed in United States District Court for the District of Montana — Great Falls Division, Medicine Horse was discussed at length. In that case, Stokes resigned from her position with the office of the Clerk and Recorder in Pondera County. In addition to an action under the Wrongful Discharge from Employment Act, she filed her § 1983 action alleging intolerable working conditions and contending that her constructive discharge deprived her of due process rights under the Fourteenth Amendment. The court dismissed her complaint, concluding that it failed to state a claim cognizable under § 1983, and declined jurisdiction of the pendent WDFEA claim. Stokes, at 2.

The defendants asserted that Stokes was an “at will” employee having no definite term of employment, no legitimate entitlement to public employment, and accordingly, no constitutionally protected property interest in her job under Montana law. Stokes contended that the WDFEA “statutorily create [d] a legitimate entitlement to continued public employment...” Stokes, at 4.

The court concluded that Stokes’ position had been rejected by this Court in Medicine Horse, citing our holding that Medicine Horse was an “at will” employee without a property interest because his employment was without a specified term. The court also cited our conclusion that “neither [the Wrongful Discharge from Employment Act] nor any other action by the Montana Legislature or [the Montana Supreme] Court has nullified the ‘at-will’ designation or section 39-2-503.” Stokes, at 4-5. The federal district judge concluded that the Montana Supreme Court made it clear that an “at will” employee in the State of Montana had no property interest in her position of employment. Citing our Scott decision, the court reiterated the caveat that although “Montana has implemented protective devices through both the Legislature and case law that operate to curb the harsh effects of the rule,... these devices ... do not obliterate the at-will rule.” Stokes, at 6. The court concluded that because the WDFEA did not nullify the at will doctrine, Stokes was an “at will” employee; that she had no property interest in her continued employment; that she, therefore, was not due the protection afforded by § 1983; and that, accordingly, her complaint failed to state a claim upon which relief could be granted.

The State and Boreen take opposite positions on whether the court correctly applied our holding in Medicine Horse to the factual situation presented in Stokes. In any event, Stokes is not authority for deciding the issue raised in this case. Like Medicine Horse, Stokes did not point to any administrative regulation under which she could only be discharged for just cause. That issue was not even raised in Stokes, much less decided.

Moreover, while we stated in Medicine Horse, that the WDFEAhad not nullified the at will statute, we did not address in that case, nor do we here, the question of whether the “good cause” provision of the WDFEA, in and of itself, creates a property interest in continued employment. Our focus in Medicine Horse was on the government policy at issue and on the employee’s failure to point to a contract or state law or regulation creating a property interest in his employment.

Finally, we consider a recent case decided by the Ninth Circuit which did deal with the issue presented by Boreen. Hollister involved an appeal from the federal district court’s dismissal of a § 1983 claim brought by a legal secretary for the Rosebud County Attorney. Hoilister worked as Rosebud County Attorney’s legal secretary for ten years when she was informed on November 30,1990, that she would be terminated effective January 4, 1991. No reasons were given for the termination. The Board of County Commissioners held a grievance hearing without the presence of Hollister, but refused to reinstate her.

Hollister brought a civil rights action in federal district court alleging that she had been deprived of a property right, her public employment, without due process, as well as other claims including a breach of the covenant of good faith and fair dealing and wrongful discharge under §§ 39-2-901, MCA, et. seq. The district court granted summary judgment in favor of the defendant county attorney, concluding that under Montana law, Hollister had no property interest in her employment and therefore, there could be no violation of the Fourteenth Amendment. The court also declined to retain supplemental jurisdiction over the state claims.

Hollister appealed to the court of appeals, maintaining that she was discharged without due process in violation of her Fourteenth Amendment rights, arguing that the Rosebud County Personnel Policy provided her with legal entitlement to continued employment because of the “just cause” provision, the requirement that she receive a post-termination hearing upon request if discharged and the requirement that she participate in the retirement program. Hollister, 22 F.3d at 951.

The circuit court stated that in Montana, the at will employment statute governed the creation of a property interest in continued employment. The court cited this Court’s interpretation of the statute, stating that “absent a specified term of employment, contained in a rale, regulation, state law, or understanding between employer and employee, an employee in Montana is an employee at will and has no property interest in his job.” Hollister, 22 F.3d at 952. (Citation omitted.) The court concluded that in the instant case, Hollister could point to no policy that specified a term of employment, nor was there a statute or written contract specifying a term of employment; therefore, she was an at will employee.

Citing Scott and Medicine Horse, the court further stated:

The Montana Supreme Court’s treatment of Mont. Code Ann. Section 39-2-503 in light of the subsequently enacted Wrongful Discharge From Employment Act,... is consistent with this conclusion. The Act provides, inter aha, that an at-will employee who is discharged without “good cause,” is entitled to certain remedies, including lost wages and benefits up to a specified limit. Nonetheless, the Act does not abrogate the provisions of the at-will employment statute, and does not create in at-will employees a property interest in their jobs.

Hollister, 22 F.3d at 953.

The court concluded that this rationale applied with equal force to the Rosebud County Personnel Policy provisions relied upon by Hollister. “ ‘[F]or cause’ and similar provisions in employment contracts, handbooks, or statutes, that fall short of an explicit agreement as to a term of employment do not give an employee a property interest in her job.” Hollister, 22 F.3d at 953, citing Reiter, 627 P.2d at 849. Under Montana law, the court continued, neither a “just cause” hearing nor mandatory retirement plan provisions in the personnel policy can be read as implying a specified term of employment. “The provisions of the County Personnel Policy, taken individually or together, do not amount to an ‘expression ... concerning the length of employment.’ ” Hollister, 22 F.3d at 953.

Without belaboring its reasoning, we simply do not agree with the court’s application of our prior case law to the facts in Hollister. Simply put, we have not heretofore addressed the issue raised in Hollister, which issue is now raised in the instant case — i.e., a public employee who can point to a specific administrative regulation or government policy that conditions disciplinary action upon “just cause.” Notwithstanding the federal court’s interpretations of Reiter and Medicine Horse, we clearly suggested, in the latter case, a contrary interpretation under the appropriate facts. “Medicine Horse presented no ... regulation specifically stating or otherwise indicating that he had a property interest in his position ... The written policy ... [allowing for termination at any time and a discretionary hearing] ... does not support the appellant’s claim of a property interest in his position.” Medicine Horse, 823 P.2d at 233.

By way of summary, in Reiter we rejected a claim that length of employment, being a supervisor and receiving job-related financial benefits would give rise to a property interest in employment. Reiter, 627 P.2d at 849. In Medicine Horse the employee did not base his claim on a “just cause” regulation, but on an ambivalent school district policy and on his length of tenure. The two cited federal court decisions to the contrary notwithstanding, a close reading of our prior cases clarifies that we have not heretofore decided the issue presented in the instant case; we have never held that an at will employment relationship cannot be altered by the employer conditioning the employee’s termination on a finding that there is “just cause” or, as the State defines that term in the regulations at issue here, “reasonable, job-related grounds for taking a disciplinary action based on failure to satisfactorily perform job duties or disruption of agency operations.” Section 2.21.6507(6), ARM.

Finally, given the concerns expressed by amici, Montana League of Cities and Towns and Montana Association of Counties, to the effect that our decision here will have “significant impact upon local government operations” and will “substantially redefine the nature of the employment relationship between public entity employers and their at will public employees,” it is, perhaps, appropriate to emphasize the obvious.

First, our decision in this case pertains only to those employees who, like Boreen, can point to some written contract, state law, or regulation which states or otherwise provides a specified term of employment and, hence, a property interest in continued employment.

Second, nothing in this decision provides a public employee protected by the type of regulations or policies at issue here with life-time job tenure and immunity from discharge. Our decision here confers upon a public employee like Boreen nothing more than what the regulations applicable to the employment at issue already provide.

Third, we have determined that regulations such at those at issue here create a property right to continued employment, absent the employer’s demonstration of just cause. As a consequence, Loudermill mandates that due process requires notice to the employee with an explanation of the employer’s evidence and the opportunity for the employee to respond in “something less” than a full evidentiary hearing before termination. Loudermill, 470 U.S. at 545-46, 105 S.Ct. at 1495. Such requirements, the purpose of which are merely to guard against a mistaken decision, do not impose an intolerable administrative burden upon the government when balanced against the catastrophic consequences to the employee of losing his or her job and very means of support. Loudermill, 470 U.S. at 543-45, 105 S.Ct. at 1493-95.

On the basis of the foregoing discussion, we hold that Boreen’s complaint did state a claim upon which relief could be granted, and, accordingly, we reverse and remand this case to the District Court for further proceedings consistent with this opinion.

REVERSED and REMANDED.

JUSTICES HARRISON, GRAY, TRIEWEILER and HUNT, concur.

APPENDIX A

2.21.6506POLICY AND OBJECTIVES (1) It is the policy of the state of Montana that:

(a) state employees who fail to perform their jobs in a satisfactory matter or whose behavior otherwise interferes with or disrupts agency operations be subject to disciplinary action, up to and including discharge;

(b) disciplinary action be administered for just cause, as defined in this policy; and

(c) an employee be informed of the cause for disciplinary action and offered the opportunity to respond. (Administrative Rules of Montana 6/30/84 2-1493 (page)

2.21.6507 DEFINITIONS

(6) “Just cause” means reasonable, job-related grounds for taking a disciplinary action based on failure to satisfactorily perform job duties or disruption of agency operations. Just cause includes, but is not limited to, an actual violation of an established agency standard, legitimate order, policy, or labor agreement, failure to meet applicable professional standard or a series of lesser violations, if the employee would reasonably be expected to have knowledge that the action or omission may result in a disciplinary action.

(7) “Due process” means ensuring an employee:

(a) is informed of the action being taken and the reason for it; and

(b) has an opportunity to respond to and question the action and to defend or explain the questioned behavior or actions.

(11) “Discharge” means, for purposes of this policy, the termination of an employee’s employment for just cause.

2.21.6509 FORMAL DISCIPLINARY ACTIONS (1) When formal disciplinary action is necessary, just cause, due process and documentation of facts are required. Formal disciplinary actions include, but are not limited to, written warning, suspension without pay, disciplinary demotion and discharge.

(2) Management shall, when appropriate, use progressive discipline. However, the appropriateness of using progressive discipline in each case lies within the discretion of management. The specific disciplinary actions taken and the order in which disciplinary actions are taken depends on the nature and severity of the performance deficiency or behavior that disrupts agency operations. Discharge should not be an initial disciplinary action expect in severe cases of unsatisfactory performance or behavior that disrupts agency operations.

(3) Each formal disciplinary action shall include a written notification to the employee which includes, but is not limited to, the following:

(a) the just cause for the disciplinary action;

(b) the disciplinary action to be taken, including dates and duration where applicable;

(c) the improvements or corrections expected, and the consequences of failure to make the required improvement or correction, if applicable.

(4) The employee shall be offered the opportunity to review, sign, and date any notice of a formal disciplinary action and shall have the opportunity for verbal and/or written response. The employee’s signature indicates that the employee has had the opportunity for review, but not necessarily that the employee agrees with the action. If the employee refuses to sign, a witness to such refusal, in addition to the supervisor, shall sign and date the notice.

(5) Where notices cannot be issued in person, they should be delivered by certified mail.

(6) All formal disciplinary actions must be documented. Documents will be maintained in accordance with the employee record keeping policy, ARM 2.21.6601 et. seq.

2.21.6522 CLOSING (1) This policy shall be followed unless it conflicts with negotiated labor contracts or specific statutes, which shall take precedence to the extent applicable.


source: Caselaw Access Project

author: JUSTICE HARRISON

license: Public Domain

text:
    STATE OF MONTANA, Plaintiff and Respondent, -vs-GRANT HILDRETH, Defendant and Appellant.
    No. 94-025.
    Submitted on Briefs July 6, 1994.
    Rehearing Denied Dec. 8, 1994.
    Decided November 1, 1994.
    51 St.Rep. 1086.
    267 Mont. 423.
    884 P.2d 771.

      For Appellant: Michael Donahoe, Attorney at Law, Helena.
    For Respondent: Hon. Joseph P. Mazurek, Attorney General, Pamela P. Collins, Assistant Attorney General, Helena; Thomas R. Scott, County Attorney, Calvin J. Erb, Deputy, Dillon.
   JUSTICE HARRISON

delivered the Opinion of the Court.

This is an appeal from a jury verdict from the Fifth Judicial District, Beaverhead County, finding appellant Grant Hildreth guilty of sexual assault, a felony, in violation of § 45-5-502, MCA. Hildreth appeals his conviction and the District Court’s denial of a motion for new trial. We affirm.

Hildreth raises several issues on appeal, which we consolidate and restate as follows:

1. Did the District Court err by failing to hold an omnibus hearing?

2. Did the District Court err in instructing the jury that the State was not required to establish the date of the offense with exact precision?

3. Did the District Court err by allowing the State to call certain rebuttal witnesses?

4. Did the District Court err by denying Hildreth’s motion in limine in the presence of the jury?

5. Did Hildreth receive ineffective assistance of counsel?

6. Is Hildreth entitled to a new trial based on the State’s attempt to offer inadmissible hearsay evidence?

7. Is Hildreth entitled to a new trial based on the doctrine of cumulative error?

In the fall of 1989, in an effort to improve her algebra grades, K.D. began tutoring sessions with her cousin, Grant Hildreth. At the time, K.D. was a fifteen-year-old high school sophomore and Hildreth was a 26-year-old attending college. The weekly tutoring/study sessions began in early October 1989. The sessions were held in the evenings at the college Hildreth attended.

The night before KD.’s Chapter Four algebra test, on or about November 16, 1989, Hildreth picked up K.D., and they drove to the college and studied from approximately 8 p.m. to approximately 9:30 p.m. At about 9:30 p.m., Hildreth left the study room to get a drink. When he did not return, K.D. went down the hall to look for him.

K.D. testified at trial that she found Hildreth down the hall, and that he then asked to give her a back rub. K.D. said that she was hesitant and Hildreth grabbed her arm. K.D. does not remember how she got to the floor, only that she was lying face down on the floor with Hildreth rubbing her back. K.D. testified that Hildreth then lifted her shirt over her head and attempted to undo her bra. They struggled over the bra. Holding her down with his hand, Hildreth succeeded in removing her bra and, while sitting on her back, pulled off her pants. K.D. testified that after throwing her clothing into a hallway, Hildreth then undid his pants and began moving his penis up and down on top of her, eventually ejaculating on her buttocks.

K.D. testified that later, after Hildreth drove her home, she washed, but was too embarrassed to tell her parents. At trial, K.D. testified that Hildreth later apologized and suggested that she go to her bishop and repent because he had gone to his bishop and talked to him about what happened.

In August of 1990, KD.’s parents learned of the incident through two letters written by K.D. which her father inadvertently found in her room. The letters described what was going on in KD.’s life, and what Hildreth was doing to her. During trial, K.D. testified about several other incidents where Hildreth had subjected her to similar sexual assaults.

After initially thinking that the situation could be handled by the family or through a Later Day Saints church procedure, KD.’s parents eventually went to the authorities. Hildreth was charged, by information dated July 9, 1991, with sexual assault, a felony. A two-day trial was held in which Hildreth raised an alibi defense, saying he was attending his own birthday party on November 16, 1989. At the close of trial, the jury returned a guilty verdict on the felony sexual assault charge. The District Court deferred imposition of sentence for six years upon certain terms and conditions. Execution of sentence was stayed pending Hildreth’s motion for a new trial. The court denied the motion, and the stay of execution was vacated.

I

Did the District Court err by failing to hold an omnibus hearing?

Pursuant to § 46-13-110(1), MCA, an omnibus hearing must be held in criminal cases at least 30 days before trial. In this case, no omnibus hearing was held. Hildreth claims that this was prejudicial error since: defense counsel was given 20 days instead of 30 days notice that the State intended to introduce “other bad acts” evidence; defense counsel did not have an opportunity to argue that evidence of KD.’s prior sexual misconduct should be admitted; and the defense was surprised by the State’s attempt to introduce certain physical evidence.

On appeal, this Court will not reverse the district court unless the record shows that the error was prejudicial. See § 46-20-701(1), MCA. We hold that Hildreth was not prejudiced by the lack of an omnibus hearing.

First, Hildreth notes that one of the purposes of an omnibus hearing is to discuss the use of other bad acts evidence. See § 46-13-110(3)(h), MCA. The other acts in question were the other sexual assaults which K.D. claimed Hildreth committed. Hildreth claims that he was prejudiced because without the omnibus hearing, he did not have 30 days to prepare for the use of other bad acts evidence. Hildreth’s claim of prejudice is unpersuasive since the State gave Hildreth notice of its intent to use other bad acts evidence pursuant to the demands of State v. Just (1979), 184 Mont. 262, 273, 602 P.2d 957, 963; as modified by State v. Matt (1991), 249 Mont. 136, 142, 814 P.2d 52, 56. The State gave Hildreth this Just notice 20 days before trial. Thus, Hildreth had 20 days to prepare for the use of the evidence. We hold that, even without the omnibus hearing, Hildreth had ample notice of the State’s intention to use other bad acts evidence, and opportunity to prepare for such evidence.

Next, Hildreth claims that the lack of an omnibus hearing deprived him of the opportunity to argue that evidence of KD.’s sexual misconduct should have been admitted. Montana’s rape shield law only allows testimony regarding the victim’s prior sexual conduct when the prior sexual activity was with the offender, or to show the origin of semen, pregnancy, or disease when it is at issue in the prosecution. See § 45-5-511(2), MCA. Hildreth contends that counsel could have argued that the statute is unconstitutional as it abridges the Sixth Amendment right to confront witnesses.

This Court has recognized that there may be instances where the defense can question the victim about prior sexual accusations. State v. Van Pelt (1991), 247 Mont. 99, 104, 805 P.2d 549, 552-53. In Van Pelt, this Court recognized that a defendant could cross-examine the victim where there was evidence of prior accusations which have been adjudicated as false. Van Pelt, 805 P.2d at 552-53. Prior accusations which have not been adjudicated as false will not be admitted, so as to preserve the integrity of the trial; this limitation is not an infringement upon a defendant’s right of confrontation. Van Pelt, 805 P.2d at 552-53; citing State v. Anderson (1984), 211 Mont. 272, 284-85, 686 P.2d 193, 200. The Van Pelt exception to the rape shield law does not apply here. Hildreth does not claim that K.D. made accusations that had been adjudicated as false before his trial. Thus, Hildreth was not prejudiced by being unable to make this argument at an omnibus hearing.

Finally, Hildreth asserts that he was prejudiced because he was surprised at trial by the State’s attempt to introduce into evidence some of KD.’s clothing. At trial, Hildreth objected because the State failed to produce this evidence prior to trial. The court sustained this objection, and the physical evidence was excluded. We hold that Hildreth was not prejudiced by the lack of an omnibus hearing.

II

Did the District Court err by instructing the jury that the State was not required to establish the date of the offense with exact precision?

At trial, Hildreth offered as an alibi his contention that on November 16, 1989, he was attending his own birthday party held one day after his actual birthday. The District Court gave the following jury instruction:

You are instructed that when the alleged victim for the offense is a child, the State is not required to establish the date of the alleged offense with exact precision. It is sufficient that the State has proved that on or about the 16th day of November, 1989, the alleged offense was in fact committed.

Hildreth argues that the District Court effectively amended the charge against him by giving the challenged instruction. Hildreth points to the State’s affidavit for leave to file an information which states that the offense occurred on November 16, 1989, rather than on or about November 16, 1989. However, the information filed against him states that the offense occurred on or about November 16,1989. The information itself, not the affidavit supporting leave to file an information, is the charging document. See §§ 46-11-101 and 46-11-102, MCA. The court’s instruction did not amend the information as to the approximate date of the offense; rather it mirrored it. We hold that the District Court did not amend the charge against Hildreth by giving the disputed instruction.

Next, Hildreth argues that the District Court impermissibly undermined his alibi defense by giving the challenged instruction. We previously examined whether time becomes a material element of the offense charged when the defendant raises an alibi defense. See State v. Shaver (1988), 233 Mont. 438, 760 P.2d 1230. In Shaver, the defendant planned to rely on an alibi defense. There was a discrepancy between the time the information stated the offense occurred and the time the victim testified that it occurred. The discrepancy in time between the charging document and the victim’s testimony was over a month. Shaver, 760 P.2d at 1232. In upholding the defendant’s conviction, this Court stated that: “Defendant cannot restrict the state’s case by merely asserting intent to rely on an alibi defense for a limited period of time within which the crime could have occurred.” Shaver, 760 P.2d at 1234-35; citing State v. Clark (1984), 209 Mont. 473, 483, 682 P.2d 1339, 1344.

In the present case, the discrepancy between the approximate date of the offense given in the information and the approximate date K.D. testified to is a few days at most. Since we allowed testimony in Shaver with a greater discrepancy, the instruction here is certainly proper. We hold that, even though Hildreth asserted an alibi defense, the disputed instruction the District Court gave is the correct statement of the law for this case. We hold that the District Court did not err by giving the disputed instruction.

Ill

Did the District Court err by allowing the State to call certain rebuttal witnesses?

In rebuttal, the State called three witnesses. Hildreth contends that these witnesses were called to rebut his alibi defense. Section 46-15-322(6), MCA, states that when witnesses will be called to rebut an alibi defense, the prosecution must give the defense written notice of the witnesses and their statements five days in advance of trial.

It appears that two of the State’s three rebuttal witnesses were called to impeach Hildreth’s witnesses, not rebut his alibi defense. Hildreth’s mother had testified that she was at Hildreth’s birthday party on November 16, 1989. One of the State’s rebuttal witnesses, who kept records for Hildreth’s parents’ bowling league, testified that Hildreth’s mother called sometime after Hildreth was charged and said that Hildreth was bowling with her on November 16, 1989. Another witness testified that Hildreth’s mother made statements to the witness that were inconsistent with her trial testimony; these statements did not involve the alibi defense, and are discussed in part V of this opinion.

Finally, the State called Deputy Keith Reeder in rebuttal. It appears that the State attempted to solicit testimony from Deputy Reeder that would rebut Hildreth’s alibi defense in violation of the notice requirements contained in § 46-15-322(6), MCA. However, this Court will only reverse prejudicial error. See § 46-20-701(1), MCA. Hildreth objected to Deputy Reeder’s testimony at trial, the court sustained the objection, and Reeder then stepped down (Reeder’s rebuttal testimony is further discussed in part VI of this opinion). We hold that Hildreth was not prejudiced by the testimony of the rebuttal witnesses.

TV

Did the District Court err by denying Hildreth’s motion in limine in the presence of the jury?

Just before the State began to question K.D. about similar sexual assaults by Hildreth, the court ruled against Hildreth’s motion in limine to exclude such evidence. The court also cautioned the jury that it could not consider the evidence to prove Hildreth’s character in order to show he acted in conformity with that character in the charged offense. Hildreth contends that by ruling on the motion in limine in the jury’s presence, the court improperly commented on the evidence.

In support of this contention, Hildreth cites State v. Liddell (1984), 211 Mont. 180, 685 P.2d 918. In Liddell, the defendant was charged with sexual intercourse without consent. Liddell, 685 P.2d at 920. The court instructed the jury that the charge in question was easily made and difficult to defend. Liddell, 685 P.2d at 921. This Court held that the instruction was an improper comment on the evidence which was not required by law or public policy. Liddell, 685 P.2d at 922.

Liddell is inapplicable to the present case. The court’s statement in Liddell was an obvious comment on the evidence; here, the court’s statement was not. Hildreth claims that by ruling on the motion in front of the jury, the court drew attention to the evidence. The record does not support Hildreth’s contention. The court simply stated that it was ruling against Hildreth’s motion in limine at that stage of the trial, and then properly cautioned the jurors on the use of the evidence. See Rule 404(b), M.R.Evid. These statements do not rise to the level of improper comment on the evidence. We therefore hold that the District Court did not err by denying Hildreth’s motion in limine in the presence of the jury.

V

Did Hildreth receive ineffective assistance of counsel?

Hildreth alleges several instances of error committed by trial counsel which, Hildreth claims, rise to ineffective assistance of counsel. This Court reviews ineffective assistance of counsel claims using the two prong test set forth in Strickland v. Washington (1984), 466 U.S. 668, 104 S.Ct. 2052, 80 L.Ed.2d 674. State v. McLain (1991), 249 Mont. 242, 244-45, 815 P.2d 147, 149. For an ineffective assistance of counsel argument to succeed, we require that the appellant show that counsel’s performance was deficient, and that the deficient performance prejudiced the appellant to such a degree that the appellant was denied a fair trial. McLain, 815 P.2d at 149; citing State v. Boyer (1985), 215 Mont. 143, 695 P.2d 829. Also, the appellant must establish prejudice, which requires that he demonstrate a reasonable probability that, but for counsel's errors, the result of the proceeding would have been different. State v. Kolberg (1990), 241 Mont. 105, 109, 785 P.2d 702, 704.

Hildreth first claims that his trial counsel was ineffective because counsel did not attempt to introduce evidence of the victim’s prior sexual misconduct. In part I of this opinion, we held that the Van Pelt exception to Montana’s rape shield law was inapplicable here; as a result, evidence of the victim’s prior sexual conduct would not have been admissible. Thus, Hildreth does not demonstrate ineffective assistance of counsel through counsel's failure to attempt to introduce evidence of KD.’s prior sexual misconduct.

Next Hildreth argues that his trial counsel erred by: allegedly opening the door to evidence of Hildreth’s prior bad acts, failing to request a lesser included offense instruction, and allegedly arguing a consent defense in closing argument. Upon review of the record, it appears that these actions were taken for strategic reasons. While Hildreth’s appellate counsel may not agree with these actions, we have held that we will not test trial counsel’s adequacy by the greater sophistication of appellate counsel, nor by that counsel’s unrivaled opportunity to study the record at leisure and cite different tactics of perhaps dubious efficacy. State v. Langford (1991), 248 Mont. 420, 433, 813 P.2d 936, 946; citing State v. Martz (1988), 233 Mont. 136, 140, 760 P.2d 65, 68. We hold that these alleged deficiencies do not amount to ineffective assistance of counsel.

Hildreth further argues that his trial counsel was deficient because counsel failed to move for a mistrial when the State offered some of K.D.’s clothing into evidence. When the State attempted to offer this evidence, Hildreth’s counsel objected on the grounds that this evidence had not been disclosed. The court sustained the objection, the items were not introduced into evidence, and the court admonished the jury to disregard the offered evidence.

In order to grant a mistrial, the moving party must demonstrate manifest necessity coupled with the denial of a fair and impartial trial. State v. Benton (1992), 251 Mont. 401, 404, 825 P.2d 565, 567. This Court has held that the failure to object does not constitute ineffective assistance of counsel where the objection lacks merit and would have been properly overruled. State v. Rodgers (1993), 257 Mont. 413, 421, 849 P.2d 1028, 1033. Amistrial would not have been properly granted in this case if it were requested as Hildreth could show neither manifest necessity nor denial of a fair trial. Thus trial counsel's failure to request a mistrial does not amount to ineffective assistance of counsel.

Finally, Hildreth asserts that counsel’s failure to object to hearsay evidence offered in rebuttal amounted to ineffective assistance. We disagree. During the defense’s case-in-chief, Hildreth’s mother denied going to KD.’s home and making certain statements to K.D.’s mother. In rebuttal, K.D.’s mother testified that Hildreth’s mother did indeed make these statements. The rebuttal testimony was admissible hearsay as prior inconsistent statements. See Rule 801(d)(1), M.R.Evid. An objection to this evidence would not have been properly sustained; thus, the failure to object does not amount to ineffective assistance of counsel. Rogers, 849 P.2d at 1033. We hold that Hildreth received effective assistance of counsel.

VI

Is Hildreth entitled to a new trial based on the State’s attempt to offer inadmissible hearsay evidence?

During rebuttal, the State called Deputy Keith Reeder to testify. Deputy Reeder testified that he had spoken with a church elder who had attended Hildreth’s birthday party in November of 1989. The State then asked Deputy Reeder if the elder had told him when the party occurred. Defense counsel objected to the question as hearsay, and the court sustained the objection. However, it appears that before Hildreth’s counsel objected, Deputy Reeder was able to respond that the elder said he had attended the party on the fifteenth. Hildreth claims that this attempt to put the objectionable testimony into evidence amounted to prosecutorial misconduct.

We have long held that we will not presume prejudice in criminal cases; prejudice must appear from the denial or invasion of a substantial right from which the law imputes prejudice. State v. Rhyne (1992), 253 Mont. 513, 525, 833 P.2d 1112, 1120; citing State v. Miller (1988), 231 Mont. 497, 507, 757 P.2d 1275, 1281. Our modem cases dealing with prosecutorial misconduct have generally come in the form of the prosecutor making comments on the evidence or comments on the defendant’s failure to testify. See Rhyne, 833 P.2d at 1120; State v. Newman (1990), 242 Mont. 315, 325, 790 P.2d 971, 977; State v. Johnson (1988), 233 Mont. 473, 477, 760 P.2d 760, 762.

In the older cases Hildreth cites, this Court found that it was prosecutorial misconduct for the State to knowingly ask a series of objectionable questions to more than one witness. See State v. Jones (1914), 48 Mont. 505, 517, 139 P. 441, 445; State v. Kanakaris (1917), 54 Mont. 180, 184, 169 P. 42, 44. In the present case, the State asked a single objectionable question of a single rebuttal witness. This does not amount to prosecutorial misconduct. In addition, in Rhyne when determining whether the conduct was prejudicial, we found it significant that the defendant successfully objected, but did not request the court to admonish the jury or give a cautionary instruction, or request a mistrial. Rhyne, 833 P.2d at 1120.

Here, Hildreth successfully objected to the hearsay testimony. Again, we find it significant that Hildreth did not request the court to admonish the jury or give a cautionary instruction, or request a mistrial. We hold that Hildreth does not demonstrate that one of his substantial rights was prejudiced by prosecutorial misconduct.

VII

Is Hildreth entitled to a new trial based on the doctrine of cumulative error?

Hildreth finally argues that this Court should reverse his conviction on the basis of cumulative error. The doctrine of cumulative error has been considered when numerous errors prejudice the defendant’s right to a fair trial. State v. Ottwell (1989), 239 Mont. 150, 157, 779 P.2d 500, 504.

In the present case, the only errors committed were that the District Court failed to hold an omnibus hearing and the State attempted to use a witness to rebut Hildreth’s alibi without giving Hildreth the proper notice. We held that those errors did not prejudice Hildreth. Accordingly, we hold that the doctrine of cumulative error does not apply in this case.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES GRAY, TRIEWEILER and WEBER concur.


author: JUSTICE WEBER

text:
    CURT DAVID, Petitioner and Appellant, v. STATE COMPENSATION MUTUAL INSURANCE FUND, Respondent and Insurer for, MIKE McCOY, Employer.
    No. 94-129.
    Submitted on Briefs September 1, 1994.
    Decided November 14, 1994.
    51 St.Rep. 1105.
    267 Mont. 435.
    884 P.2d 778.

      For Appellant: Patrick R. Sheehy, Halverson, Sheehy & Plath, Billings.
    For Respondent: Dan Whyte, Legal Counsel, State Compensation Mutual Insurance Fund, Helena.
   JUSTICE WEBER

delivered the Opinion of the Court.

This is an appeal from a Workers’ Compensation Court decision in favor of the State Fund’s method of calculating benefits for claimant David. We affirm.

We consider the following issues on appeal:

I. Did the Workers’ Compensation Court err in determining the temporary total disability rate to be paid to claimant David?

II. Did the Workers’ Compensation Court properly deny attorney fees?

III. Did the Workers’ Compensation Court properly deny an award of a 20% penalty pursuant to § 39-71-2907, MCA (1991)?

Claimant Curt David (David) was hired by Mike McCoy to do ranch work for a period of one day with compensation of $50.00 for that day’s work. At the time of this employment, David was also self-employed as a massage therapist for the YMCA in Billings, Montana, and anticipated future work on the rodeo circuit as a rodeo clown. David testified that he had oral contracts to work twelve rodeos as a rodeo clown throughout the season.

During the one day David worked for Mike McCoy, his horse bucked, forcing him to slam into his saddle and breaking a fusion rod that had been inserted in his spine during a 1986 surgery. In 1986, David was thrown from his horse, fracturing several parts of his spine. The injuries required the insertion of fusion rods in the spine for support. These rods were never removed.

David filed a workers’ compensation claim. State Fund calculated David’s compensation by interpreting § 39-71-123, MCA (1991), to mean that a person who is hired to work only one day has an average weekly wage equalling that one day’s wages. Here, the State Finid found that David had earned $50 and that his benefits would amount to two-thirds of that, or $33.33 per week. David received temporary total disability benefits for a period of eighteen weeks and four days.

As a result of this calculation, David appealed to the Workers’ Compensation Court. The Workers’ Compensation Court entered its Findings of Fact, Conclusions of Law and Judgment on March 18, 1994, concluding that, based upon § 39-71-123, MCA(1991), the State Fund properly determined David’s temporary total disability wage rate for his employment with Mike McCoy.

From these findings and conclusions, David appeals to this Court.

I

Did the Workers’ Compensation Court err in determining the temporary total disability rate to be paid to claimant David?

David argues that the State Fund should have calculated his benefits on a total of what he would have earned had he worked for Mike McCoy for a week, or $250. This is because he was employed full time in other jobs and the award of $33.33 per week does not represent an accurate picture of his wages. However, David contends that his argument does not mean that he feels the State Fund should have aggregated his actual wages from all his jobs.

The State Fund argues that the Workers’ Compensation Court was correct in interpreting the entire statute instead of only one subsection of § 39-71-123, MCA (1991). The State Fund argues that the statute clearly dictates that when a sole proprietor has not provided workers’ compensation coverage for his business, he cannot include money made from the business in the total from which award benefits are calculated. The State Fund contends that because David had his own massage business he was a sole proprietor. Further, David’s alleged contracts with the rodeos were not in force yet and could not be included in the award either.

At issue here is the Worker’s Compensation Court’s interpretation of § 39-71-123, MCA (1991). A conclusion of law made by a Workers’ Compensation Court is reviewed to determine whether the conclusion is correct. Gibson v. State Compensation Mut. Ins. Fund (1992), 255 Mont. 393, 842 P.2d 338.

The court concluded that the State Fund had calculated David’s award correctly. That award came to $33.33 based upon the figure of $50 that he made while working for Mike McCoy. David argues that only § 39-71-123(3)(a), MCA (1991), applies. State Fund argues that the entire statute must be used to determine the benefit rate for David, including the limitations placed on an award by subsection 4(c) of the statute.

The pertinent statute in its entirety reads:

Wages defined. (1) ‘Wages” means the gross remuneration paid in money, or in a substitute for money, for services rendered by an employee. Wages include but are not limited to:
(a) commissions, bonuses, and remuneration at the regular hourly rate for overtime work, holidays, vacations, and sickness periods;
(b) board, lodging, rent, or housing if it constitutes a part of the employee’s remuneration and is based on its actual value; and
(c) payments made to an employee on any basis other than time worked, including but not limited to piecework, an incentive plan, or profit-sharing arrangement.
(2) Wages do not include:
(a) employee expense reimbursements or allowances for meals, lodging, travel, subsistence, and other expenses, as set forth in department rules;
(b) special rewards for individual invention or discovery;
(c) tips and other gratuities received by the employee in excess of those documented to the employer for tax purposes;
(d) contributions made by the employer to a group insurance or pension plan; or
(e) vacation or sick leave benefits accrued but not paid.
(3) For compensation benefit purposes, the average actual earnings for the four pay periods immediately preceding the injury are the employee’s wages, except if:
(a) the term of employment for the same employer is less than four pay periods, in which case the employee’s wages are the hourly rate times the number of hours in a week for which the employee was hired to work', or
(b) for good cause shown by the claimant, the use of the four pay periods does not accurately reflect the claimant’s employment history with the employer, in which case the insurer may use additional pay periods.
(4) (a) For the purpose of calculating compensation benefits for an employee working concurrent employments, the average actual wages must be calculated as provided in subsection (3).
(b) The compensation benefits for a covered volunteer must be based on the average actual wages in his regular employment, except self-employment as a sole proprietor or partner who elected not to be covered, from which he is disabled by the injury incurred.
(c) The compensation benefits for an employee working at two or more concurrent remunerated employments must be based on the aggregate of average actual wages of all employments, except self-employment as a sole proprietor or partner who elected not to be covered, from which the employee is disabled by the injury incurred.
(5) The compensation benefits and the payroll, for premium purposes, for a volunteer firefighter covered pursuant to 39-71-118(4) must be based upon a wage of not less than $900 a month and not more than 1 and 1/2 times the average weekly wage as defined in this chapter.

Section 39-71-123, MCA (1991); relevant parts of this statute have been highlighted.

The Workers’ Compensation Court relied on both § 39-71-123(3)(a) and § 39-71-123(4)(c), MCA. According to the court, David worked less than four pay periods for McCoy; therefore, the court found that the State Fund was correct in using the exact number of hours worked and the exact pay received as stated in subsections 3(a) and 4(a). This amounted to eight hours at $6.25 or $50.00. The court also looked at the fact that David had other employment. The other employments, however, were not employer-employee situations.

David was self-employed as a massage therapist; he was not an “employee.” Thus, the court found him to be a sole proprietor who had elected not to be covered by workers’ compensation insurance and pursuant to subsection 4(c) he could, therefore, not include any of the money made from this work. The court further denied inclusions of potential amounts provided by future contracts for work as a rodeo clown. The court determined that the future contracts were also obtained by David in a capacity as sole proprietor.

The Workers’ Compensation Court was correct in considering § 39-71-123, MCA (1991) in its entirety; a statute must be read as a whole. Dover Ranch v. Yellowstone County (1980), 187 Mont. 276, 609 P.2d 711. While David chooses only subsection 3, that subsection cannot be interpreted in isolation. The entire statute provides more than the rote “four-previous-pay-periods” formula for which David argues. The statute anticipates a situation like David’s by stating that if the work was not equal to four-pay-periods for the same employer, then the “actual” hours worked and the “actual” pay obtained must be used. This is the exact calculation used by the State Fund and the Workers’ Compensation Court.

David was hired for one day of work. He did not work for McCoy before this one day nor did he work for him after. David argues that the State Fund should have projected his weekly salary to $250 which is what he would have earned had he worked for McCoy for a week. However, this total does not resemble at all the “actual average wages” received from McCoy. Section 39-71-123(3), MCA (1991). The “actual” wages were only $50.

Yet, David cites us to Lovell v. State Compensation Insurance (1993), 260 Mont. 279, 860 P.2d 95, for the proposition that his method of calculation is appropriate. David claims that Lovell permits him to project his one day’s wages to that of what a full week would have been. David believes that because he was employed full-time, albeit at other work, he is entitled to make this projection.

Lovell does not support David’ reasoning. The Workers’ Compensation Court in Lovell determined that § 39-71-123(3)(a), MCA (1987), precluded aggregation of wages from other sources when determining an employee’s award benefit. On appeal, we concluded that this was not a correct interpretation of the law. We then considered the correct interpretation of “wages” and the changes made to the workers’ compensation law in 1987.

We concluded that the 1987 changes did not affect the long-standing rule permitting aggregation of concurrent employment. However, we were cognizant that because of the Workers’ Compensation Court’s stance on non-aggregation, the court had not considered whether Lovell met the definition of “employee” with regard to other work he may have been performing or whether other income constituted wages from concurrent employment. We, therefore, remanded the action back to the court for this determination.

Here, the Workers’ Compensation Court did make a determination that David was not an “employee” but was a “sole proprietor” who had made no workers’ compensation provisions for his business. Such a designation means that the benefit calculations must be made without consideration of any money earned from the business.

David had the burden of proving he was an “employee” in order that his other full-time employment could be considered for his benefit award. Our statutes provide very long and detailed definitions of what constitutes an “employee” and an “employer.” Sections 39-71-117 and 39-71-118, MCA (1991). An employee is not a “sole proprietor.” Section 39-71-118(3)(d), MCA (1991). Thus, “persons who are truly independent in their operations according to the standards established for determining that issue should not be held to be employees.” St. John’s Lutheran v. State Comp. Ins. Fund (1992), 252 Mont. 516, 523, 830 P.2d 1271, 1276.

Whether a person is an “employee” is important because both subsections 3(a) and 4(a) calculate the award benefits for “employees.” However, subsection 4(c) contains an exclusion for sole proprietors. Subsection 4(c) states that when a sole proprietor elects not to provide workers’ compensation coverage he cannot include money derived from his business for the purpose of determining his benefit.

David admits the YMCA merely supplied him with a room in the YMCAfacility. The record indicates that the YMCA did not control his business as a massage therapist. The record clearly shows that within his role as massage therapist, he was “free from control.” David independently established his business and ran it himself; he was not an employee. Therefore, we conclude that the State Fund had to consider the statutory limitations put on sole proprietors by subsection 4(c) of § 39-71-123, MCA (1991). Because David has not supplied evidence that he paid workers’ compensation premiums, the exclusions in 4(c) require that any money David received from his massage business must not be counted toward his award benefit.

Without “employee” status for David’s alleged full-time work, the State Fund and the Workers’ Compensation Court had to rely on the specific calculations called for in subsection 3(a) and 4(a), plus the exclusions found in 4(c). These calculations call for inclusion of “actual” hours worked per week for “actual” wages received. This total is then multiplied by 66 and 2/3% to get the benefit amount for temporary total disability. Section 39-71-701, MCA (1991). State Fund calculated David’s benefits accordingly as did the Workers’ Compensation Court.

We hold that the Workers’ Compensation Court did not err in determining the temporary total disability rate to be paid to claimant David.

II

Did the Workers’ Compensation Court properly deny attorney fees?

The statute governing payment of attorney’s fees states:

[if] the case is brought before the workers’ compensation judge for adjudication of the controversy, and the award granted by the judge is greater than the amount paid or offered by the insurer, a reasonable attorney’s fee and costs... may be awarded by the judge in addition to the amount of compensation.

Section 39-71-612(1), MCA (1991).

Here, the Workers’ Compensation Court agreed with the award calculated by the State Fund. Therefore, because the award by the court was the same, attorney fees would be inappropriately awarded to David.

We hold that the Workers’ Compensation Court properly denied attorney fees.

III.

Did the Workers’ Compensation Court properly deny an award of a 20% penalty pursuant to § 39-71-2907, MCA (1991)?

The workers’ compensation judge may increase by 20% the full amount of benefits due a claimant during the period of delay or refusal to pay...

Section 39-71-2907(1), MCA (1991).

The insurer here did not deny the full amount of benefits, but calculated the benefits correctly. Therefore, there exists no basis for a 20% penalty.

The Workers’ Compensation Court properly denied an award of a 20% penalty pursuant to § 39-71-2907, MCA (1991).

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES HARRISON, GRAY, TRIEWEILER, NELSON and HUNT concur.


author: JUSTICE HUNT

text:
    JAMES D. LARSON, Petitioner and Appellant, v. BARRY SMITH LOGGING, INC., Employer, and STATE COMPENSATION INSURANCE FUND, Defendant and Respondent.
    No. 94-014.
    Submitted on Briefs August 11, 1994.
    Decided November 14, 1994.
    51 St.Rep. 1114.
    267 Mont. 444.
    884 P.2d 786.

      For Appellant: Timothy J. Lape, Attorney at Law, Missoula.
    For Respondent: Susan C. Witte, Legal Counsel, State Compensation Insurance Fund, Helena.
   JUSTICE HUNT

delivered the Opinion of the Court.

Petitioner James D. Larson appeals the judgment of the Workers’ Compensation Court entered December 17, 1993, which concluded that because Larson failed to provide his employer with notice of his alleged injury within the 30 days prescribed by § 39-71-603, MCA, he was not entitled to benefits.

Affirmed.

We state the issue as follows:

Is there substantial evidence to support the Workers’ Compensation Court’s decision that Larson was not entitled to benefits?

Larson is 42 years old and has worked in the timber industry for 20 years. For 14 of those 20 years, Larson has worked as a sawyer. Barry Smith Logging employed Larson as a sawyer from January 1992 to June 5, 1992. Larson alleges he injured his back on April 9, 1992, while working for Barry Smith Logging at a timber site near Schwartz Creek. At the time of the alleged injury, Barry Smith Logging was insured by the State Fund.

On the same day as the alleged injury, Larson told John Rockenbaugh, a co-sawyer working at the Schwartz Creek site, that he had “taken a bad spill” and was “feeling kind of poorly.”

Larson began a series of four chiropractic treatments beginning April 17, 1992, and ending May 1, 1992. Larson paid for the treatments and did not submit a first report of treatment to the State Fund until early June 1992.

On May 18,1992, 39 days after the April 9,1992, accident, Larson notified his employer, Barry Smith, of the alleged injury.

Larson filed a written claim for workers’ compensation on June 3, 1992. On June 24,1992, the State Fund denied Larson’s claim because Larson failed to notify his employer of his injury within 30 days.

On June 8, 1993, Larson filed a petition with the Workers’ Compensation Court. A trial was held on September 22, 1993, and judgment was entered on December 17, 1993. The court concluded that Larson was not entitled to benefits because he failed to provide his employer with notice of the alleged injury within 30 days pursuant to § 39-71-603, MCA. Larson appeals the decision of the Workers’ Compensation Court.

Is there substantial evidence to support the Workers’ Compensation Court’s decision that Larson was not entitled to benefits?

On review, this Court will not substitute its judgment for that of the Workers’ Compensation Court and will uphold its findings if there is substantial evidence to support them. Reeverts v. Sears (1994), [266 Mont. 509], 881 P.2d 620, 622; Buckentin v. State Fund (1994), [265 Mont. 518], 878 P.2d 262, 263; Plainbull v. Transamerica Insurance (1994), 264 Mont. 120, 125-26, 870 P.2d 76, 80; Houts v. Kare-Mor, Inc. (1993), 257 Mont. 65, 68, 847 P.2d 701, 703. ‘We will uphold the court’s conclusions of law if its interpretation of the law is correct.” Reeverts, [266 Mont. 509] 881 P.2d at 622; Stordalen v. Ricci’s Food Farm (1993), 261 Mont. 256, 257, 862 P.2d 393, 394; Martelli v. Anaconda-Deer Lodge County (1993), 258 Mont. 166, 167, 852 P.2d 579, 580.

Larson notified his employer, Smith, of the injury 39 days after sustaining it on April 9,1992. On the day of the accident, Larson told co-worker John Rockenbaugh that he had “taken a bad spill.” Larson maintains that he informed Rockenbaugh of the injury, rather than his employer, because believed that Rockenbaugh was a managing agent or superintendent in charge of the work site. Larson asserts that by informing Rockenbaugh of the injury, he satisfied the 30 day notice requirement of § 39-71-603, MCA, which provides:

No claim to recover benefits under the Workers’ Compensation Act, for injuries not resulting in death, may be considered compensable unless, within 30 days after the occurrence of the accident which is claimed to have caused the injury, notice of the time and place where the accident occurred and the nature of the injury is given to the employer or the employer’s insurer by the injured employee or someone on the employee’s behalf. Actual knowledge of the accident and injury on the part of the employer or the employer’s managing agent or superintendent in charge of the work upon which the injured employee was engaged at the time of the injury is equivalent to notice.

The record shows that Smith is the sole owner and the only managing agent or superintendent at Barry Smith Logging. The company office is located in Smith’s home. John Rockenbaugh was employed by Smith as a sawyer. Both Rockenbaugh and Larson were paid by the piece, and as sawyers, they performed the same tasks. There is nothing in the record to show that Rockenbaugh was employed as a supervisor or that he supervised Larson’s work on April 9,1992.

Larson argues that if Rockenbaugh was not a managing agent or superintendent in fact, he was at least an ostensible supervisor. “An agency is ostensible when the principle intentionally or by want of ordinary care causes a third person to believe another to be his agent.” Section 28-10-103, MCA. The belief that another is an agent must be reasonable. Bogle v. State Compensation Mutual Insurance Fund (1994), 264 Mont. 515, 519, 872 P.2d 800, 802; Butler Mfg. Co. v. J & L Implement Company (1975), 167 Mont. 519, 527, 540 P.2d 962, 965.

Larson asserts that he reasonably believed Rockenbaugh was a managing agent or superintendent because Rockenbaugh was the only person at the work site who gave him instructions. While the record shows that Rockenbaugh was the only person at the work site to give Larson instructions, the record also shows that it could have been Larson giving instructions to Rockenbaugh on April 9, 1992. Smith testified that sawyers usually worked in pairs. Smith would give the location of the next work site, along with cutting specifications, to whichever sawyer was handy at the time. Once at the site, the informed sawyer would then relay the cutting specifications to the other sawyer. Smith instructed Larson to meet Rockenbaugh at the Schwartz Creek site on April 9, 1992. Once there, Rockenbaugh relayed the cutting specifications to Larson. Thereafter, both sawyers worked independently; were paid based on their individual work output; and neither supervised the work of the other.

Larson contends that Smith failed to give him any directions about reporting accidents. Larson contends further that he reported the injury to Rockenbaugh because Smith was hard to contact. The record does not support these contentions. Six weeks prior to the accident in the present case, Larson cut his lip while on the job and reported that injury directly to Smith at the company office by telephone within the prescribed 30 days. Larson then filed an unsuccessful workers’ compensation claim as a result of the cut lip.

There is nothing in the record to suggest that Smith intentionally or by want of ordinary care held Rockenbaugh out to be an ostensible agent. Rockenbaugh did not supervise Larson’s work, nor did he hold himself out to be a supervisor. At no time did either Smith or Rockenbaugh tell Larson that Rockenbaugh was a supervisor. We note from the record that when asked by a claims examiner for the State Fund whether he worked with a supervisor he could have notified about his injury, Larson replied “No.”

Larson next argues that the 30 day notice requirement of § 39-71-603, MCA, was substantially complied with, and that the purpose of the statute was satisfied. We have held that the purpose of the notice requirement is to enable the employer to protect himself by prompt investigation of the claimed accident and prompt treatment of the injury to minimize its effect. Bender v. Roundup Mining Co. (1960), 138 Mont. 306, 312-13, 356 P.2d 469, 472. Smith was not able to start investigating the accident until May 18, 1992, nine days after the allowable statutory period had expired. Larson’s four chiropractic treatments ended 18 days before Smith was notified of the accident. Larson’s injury was not diagnosed until mid-June 1992, after he underwent an MRI 27 days after Smith should have been notified of the injury. The purpose of the notice requirement, protection of the employer’s interests, was at least compromised, if not frustrated, by Larson’s failure to report his injury to Smith within 30 days.

As to substantial compliance, the statute clearly states that no claim shall be considered compensable unless the employer or employer’s insurer is notified within 30 days. Notice under the statute is mandatory, and compliance is indispensable to maintaining a claim for compensation. Buckentin, 878 P.2d at 265; Reil v. Billings Processors, Inc. (1987), 229 Mont. 305, 308, 746 P.2d 617, 619; Masters v. Davis Logging (1987), 228 Mont. 441, 443, 743 P.2d 104, 106.

Larson argues that although he knew that he injured himself on April 9, 1992, he did not realize the severity of the injury until 30 days had passed, thereby tolling the 30 day notice requirement. To support his position, Larson relies on Killebrew v. Larson Cattle Co. (1992), 254 Mont. 513, 839 P.2d 1260. In Killebrew, we concluded that an employee who reasonably believes at the time of an accident that he suffered no injury requiring medical treatment, is not barred by the 30 day notice requirement of § 39-71-603, MCA, when he discovers otherwise after the 30 day period has elapsed. The record shows that following the accident Larson took several days off from work because of the injury, and that he received a series of chiropractic treatments thereafter. These facts do not indicate a latent injury. We have held that “ ‘simple ignorance of compensability, absent any evidence of estoppel by the employer or medical disinformation [is insufficient] to toll the notice requirement.’ ” Buckentin, 878 P.2d at 265 (quoting Reil, 746 P.2d at 623) (alteration in original). There is no evidence in the record to show that Larson’s employer prevented him from reporting the injury or that he was misinformed about the extent of the injury by medical personnel.

Larson did not comply with the mandatory 30 day notice requirement of § 39-71-603, MCA. Based on his past experience, Larson understood how and when to notify his employer of injury, and he understood the procedure for filing a workers’ compensation claim. Larson was aware that he suffered an injury and he sought medical treatment shortly after the accident. The Workers’ Compensation Court concluded, and we agree, that Larson did not notify his employer within the 30 days as required under § 39-71-603, MCA.

We hold that there is substantial evidence to support the Workers’ Compensation Court’s decision that Larson was not entitled to benefits.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES GRAY, NELSON and WEBER concur.


author: CHIEF JUSTICE TURNAGE

text:
    IN RE THE MARRIAGE OF NANCY KAY JAKKOLA, Petitioner and Respondent, and WESLEY VERNON JAKKOLA, Respondent and Appellant.
    No. 94-126.
    Submitted on Briefs October 13, 1994.
    Decided November 14, 1994.
    51 St.Rep. 1117.
    267 Mont. 450.
    884 P.2d 783.
    For Appellant: J. Reuss, Wright, Tolliver & Guthals, P.C., Billings.
    For Respondent: Kent E. Young, Red Lodge.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Wesley Vernon Jakkola appeals from a decision of the Thirteenth Judicial District Court, Carbon County, ordering him to pay his wife $6,000 pursuant to an in-court stipulation. We affirm.

The sole issue is whether the District Court erred in enforcing the stipulation made between the parties.

Nancy and Wesley Jakkola were married in Idaho on April 30,1966. In 1973 the couple returned to Wesley’s parents’ ranch near Roberts, Montana, and began working on the ranch. Nancy and Wesley purchased the ranch from his parents a few years later. The couple lived and worked on the ranch until early in 1992, when they separated due to marital problems. Nancy filed for divorce in May 1992.

While the couple was separated, but before the final decree of dissolution, Wesley borrowed $18,144 from various family members to pay the ranch’s day-to-day operating expenses as well as his personal expenses. This debt was to be paid out of marital assets. Approximately $7,000 was used for ranch expenses and $11,000 for personal expenses. During this same period Nancy sold marital assets worth over $6,000 to pay her personal expenses. Wesley incurred a marital debt of approximately $11,000 for his personal expenses while Nancy liquidated approximately $6,000 in marital assets for her personal expenses during the pendency of the divorce. The net result was that Wesley spent $5,000 more of their marital assets than Nancy during the same time period. The parties later agreed to the figure being $6,000 in return for Nancy not contesting some of the alleged “ranch” expenses claimed by Wesley including gas, electricity, and the use of ranch vehicles for personal reasons.

The parties stipulated that $6,000 would be added to Nancy’s share of the marital estate as compensation for the excess amount Wesley spent on personal expenses during the separation. The District Court carefully explored the ramifications of this stipulation with both parties, explaining that Nancy would receive $6,000 in addition to whatever it determined was her equitable share of the marital estate.

The District Court issued its findings of fact and conclusions of law, determining that an equitable division would be accomplished by dividing the value of the marital estate equally. Wesley received the ranch, but was required to pay Nancy an amount that would result in an equal distribution of the value of the marital estate. After the estate was divided equally, Wesley was ordered to pay Nancy the stipulated $6,000 to compensate her for the excess amount he spent during the separation.

Wesley moved the court to amend its findings of fact and conclusions of law. Wesley claimed he should be required to pay Nancy only $3,000 in addition to the property settlement. The District Court denied this portion of Wesley’s motion and he appeals.

Did the District Court err in enforcing the stipulation between the parties?

We will not disturb a district court’s property distribution unless the division of assets is clearly erroneous. In Re the Marriage of Sacry (1992), 253 Mont. 378, 384, 833 P.2d 1035, 1039. A district court’s findings are not clearly erroneous unless they are not supported by substantial evidence, the court misapprehended the evidence, or a review of the record leaves this Court with the definite and firm conviction that a mistake was committed. Interstate Prod. Credit Ass’n v. DeSaye (1991), 250 Mont. 320, 323, 820 P.2d 1285, 1287.

Wesley claims that he should only be required to pay Nancy $3,000. By paying her $3,000 after the property settlement, his share of the marital estate would be decreased by $3,000 and her share would be increased $3,000. This would result in her share of the marital estate being $6,000 more than his, thus satisfying the terms of the stipulation. Wesley claims that this is the correct interpretation of the stipulation because the $6,000 in question was a marital asset, therefore, he was entitled to $3,000 of it. He claims the District Court’s ruling in essence made Nancy’s share of the marital estate $12,000 greater than his. By paying her $6,000 after the estate had been divided equally, his share was decreased by $6,000 while her share was increased by $6,000. Wesley claims this was not the intent of the parties when they entered into the stipulation.

Wesley insists that the District Court incorrectly interpreted the stipulation between the parties. Wesley claims that if a husband spends marital assets during a separation pending a divorce, he should be required to pay his wife one-half that amount after the divorce. Such arrangements are not uncommon.

In In Re the Marriage of Rogers (1987), 226 Mont. 163, 734 P.2d 677, the husband liquidated approximately $9,000 of marital assets while he and his wife were separated. This court stated:

[T]he husband objects to being ordered to pay the wife $4,500 as her share of assets he liquidated during their separation. The record shows that he sold a motor home for $6,000 and closed out a $3,300 IDS account. He contends these funds were necessary to cover the expenses of himself and the three children, who were all residing with him at that time.
There is no question that the IDS account and the mobile home were marital property. We conclude that the District Court was within its discretion in directing that the wife receive $4,500 as her share of the marital assets sold.

Rogers, 734 P.2d at 679. We held that the district court in Rogers did not err in ordering the husband to pay one-half the amount he had liquidated during the separation.

However, Wesley did not stipulate to such an arrangement. Wesley agreed to pay Nancy $6,000 in addition to her equitable share of the marital estate. Parties are bound by stipulations made in open court. In Re the Marriage of McLean/Fleury (1993), 257 Mont. 55, 60, 849 P.2d 1012, 1015. This Court likewise held that the district court in which the stipulation was entered should also follow the stipulation. We recently stated: “[T]o the extent that the court is able to apply the statutory [§ 40-4-202, MCA] criteria while, at the same time, holding the parties to their on-record stipulations and agreements, it should do so.” In Re the Marriage of Simms (1994), 264 Mont. 317, 326, 871 P.2d 899, 904. The District Court record clearly indicates that Nancy’s share of the marital estate was to be increased by $6,000. To clarify the exact terms of the stipulation, the District Court made the following statements:

THE COURT: In other words, what you are proposing, Mr. Reuss, is that Mrs. Jakkola be given $5,000 [later changed to $6,000] credit — in other words, if I were to determine that her share of the ranch share should be $100,000, I should add $5,000 to it to equalize the moneys that he used for his own purpose?
So the Court understands that, the Court, as a result of that stipulation, is authorized to give to Mrs. Jakkola $6,000 credit for — on any property — any amount of property that is set over to her; is that correct?
[O]r in other words just to put it just the reverse, that [Mr Jakkola] will be charged $6,000 as against his marital share. [Emphasis added.]

Both parties agreed to the stipulation. By agreeing to the stipulation, Nancy gave up her right to contest how much of the $18,144 loan was actually used for ranch expenses and how much was used for Wesley’s personal expenses. She relinquished this right relying on the stipulation. The stipulation in this case does not lend itself to varying interpretations. The terms of the stipulation are clear. Nancy was to receive $6,000 from Wesley in addition to any property settlement.

We conclude that the District Court did not err in ordering Wesley to pay Nancy $6,000 after the division of the marital estate. We therefore affirm the decision of the District Court.

JUSTICES HARRISON, GRAY, NELSON and WEBER concur.