text:
    STATE OF MONTANA, Plaintiff and Respondent, v. BLAKE ALFRED RANDALL, Defendant and Appellant.
    No. 88-480.
    Submitted on Briefs March 16, 1989.
    Decided May 4, 1989.
    772 P.2d 868.
    J. Dirk Beccari, Public Defender, Missoula, for defendant and appellant.
    Marc Racicot, Atty. Gen., Robert F.W. Smith, Asst. Atty. Gen., Helena, M. Shaun Donovan, County Atty., Superior, for plaintiff and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

A jury empaneled in the District Court of the Fourth Judicial District, Mineral County, found Blake A. Randall, the defendant, guilty under § 45-5-401 and § 45-2-302, MCA, for the offense of accountability for robbery. Finding no legal cause why judgment should not be pronounced against the defendant, the District Court sentenced him to the Montana State Prison for a term of 15 years with three suspended. Defendant appeals. We affirm.

The issue raised on appeal is whether the District Court erred in admitting evidence of other acts by the defendant.

On September 17, 1987, the defendant, Blake Randall, and his three companions, Robert Davis, Antonio Alvernaz, and Megan Carder, were traveling in defendant’s vehicle from the vicinity of Seattle, Washington, en route to Missoula, Montana. At approximately 3:00 p.m. on that date they arrived in Alberton, Montana, pulled into the River’s Edge Motel, and the driver of the vehicle proceeded to pump approximately $25 worth of gasoline into the vehicle. The driver was joined by a second mán who accompanied him into the motel-gas station office. These two men were later identified as Davis and Alvernaz.

One of the men had a gun and forced Steven Stahl, the motel owner, to lie on the office floor. The two men took approximately $200 from the cash register and Stahl’s wallet, several quarts of motor oil, and a portable’ radio-cassette tape player.

Davis and Alvernaz returned to the vehicle. Defendant then drove the vehicle through Alberton to the Nine Mile House, a local bar, restaurant, and grocery, where Alvernaz purchased approximately $35 worth of beer and cigarettes. After Alvernaz returned to the vehicle with the items, defendant continued to drive east toward Missoula. Approximately 10 miles outside of Missoula, the four were apprehended by the Missoula County Sheriff’s Department for the robbery of the River’s Edge Motel. A subsequent search of the vehicle revealed a gun, Stahl’s credit cards and driver’s license, oil bottles and a radio-cassette player.

On October 7, 1987, an information was filed charging defendant with the offense of accountability for robbery in violation of § 45-5-401 and § 45-2-302, MCA. On February 10, 1988, the State filed notice of intent to introduce evidence of other acts. Specifically, the State sought to introduce evidence of the robberies of Popular Food and Gas in Snohomish, Washington, on September 14, 1987, and of Y-E-Z Market in Penshastin, Washington, on September 15, 1987. On February 22, 1988, the District Court held a hearing on the other acts evidence in which it ruled that evidence of the September 14, 1987, Snohomish robbery was excluded because it did not qualify under State v. Just (1979), 184 Mont. 262, 602 P.2d 957, and that the evidence concerning the September 15, 1987, Penshastin robbery was admissible because defendant admitted involvement in the offense.

A jury trial held in February, 1988, ended in a mistrial. A second trial was held on March 22, 1988, and the jury returned a verdict of guilty to the offense of accountability to robbery on March 23, 1988. The defendant was sentenced to the Montana State Prison for 15 years with three suspended. Defendant appeals.

The issue raised on appeal is whether the District Court erred in admitting evidence of other acts by the defendant.

The State sought to introduce defendant’s other acts in order to support its proof on the issue of defendant’s intent, state of mind, and to prove that defendant’s acts were consistent with a common scheme, plan or system. Defendant contends that admission of a prior act, the September 15, 1987, Penshastin robbery, was in violation of the protections afforded to him by Rule 404(b), M.R.Evid., and that the prior act failed to meet the requirements for admission set forth in Just, 602 P.2d at 961.

Rule 404(b), M.R.Evid. provides:

“Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show that he acted in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident.”

The rule must be strictly enforced, except where clearly justified, and exceptions to the rule must be carefully limited. Just, 602 P.2d at 962, citing State v. Tiedemann (1961), 139 Mont. 237, 242-43, 362 P.2d 529, 531. Circumstances constituting admission of prior acts lies in the discretion of the trial judge, providing that “the probative value outweighs the prejudicial.” State v. Matson (Mont. 1987), [227 Mont. 36,] 736 P.2d 971, 976, 44 St.Rep. 874, 880. Evidence is strictly inadmissible for the purpose of showing the commission of that particular offense. Just, 602 P.2d at 960, citing State v. Taylor (1973), 163 Mont. 106, 120, 515 P.2d 695, 704.

Just, 602 P.2d at 961, provided a four element test which determined the admissibility of other acts when a common scheme, plan or system was demonstrated. The test, based on State v. Jensen (1969), 153 Mont. 233, 455 P.2d 631, and Rule 403, M.R.Evid., is set forth as follows:

1. The similarity of crimes or acts;

2. nearness in time; and

3. tendency to establish a common scheme, plan or system; and

4. the probative value of the evidence is not substantially outweighed by the prejudice to the defendant.

Applying these elements to the facts of the case at bar, we hold that the evidence of defendant’s actions in the Penshastin robbery were properly admitted.

Defendant argues that because insufficient similarities existed between the Alberton robbery and the Penshastin robbery, the acts are inadmissible evidence. We disagree. Both incidents occurred within three days of one another; the identical participants were involved; defendant’s vehicle was utilized; and both incidents involved robbing store clerks at gunpoint. The incidents need not be identical in order to introduce the prior incident as a similar act as long as there is “sufficient similarity” to sustain the admission of the prior act. State v. Tecca (1986), 220 Mont. 168, 172, 714 P.2d 136, 138. As noted in State v. Hansen (1980), 187 Mont. 91, 95, 608 P.2d 1083, 1085, when “applying the exception each case must rest upon its own circumstances.” Here, the circumstances were sufficiently similar to warrant admission of the other act.

Defendant further argued that since he was not charged with the Penshastin robbery, the District Court abused its discretion when it admitted evidence of the incident. However, on September 23, 1987, defendant was interviewed by the Mineral County Sheriff’s Department concerning the Alberton robbery and he admitted helping Davis and Alvernaz commit the robbery in Penshastin, Washington, by driving the getaway car. Throughout the interview he described the similarities in the robberies as well.

In Just, 602 P.2d at 963, we held that the burden of proof as to the other acts need not rise to the level required in a criminal prosecution for similar acts. It must be noted that the State contends that by the time of the second trial, authorities in Chelan County (Penshastin), Washington, had filed charges against defendant for aiding and abetting robbery in the first degree. The evidence of defendant’s participation in the Penshastin robbery is similar and is admissible whether or not defendant was actually charged with the offense. While we continue to decline to establish an arbitrary time limit for admitting prior acts evidence as provided in Tecca, 714 P.2d at 139, the element of nearness in time in this case was satisfied since the robbery of the Penshastin convenience store occurred three days prior to the Alberton robbery. In State v. Hall (Mont. 1988), [234 Mont. 57,] 761 P.2d 1283, 45 St.Rep. 1726, we held that six months is sufficient to satisfy the element and in State v. Heine (1976), 169 Mont. 25, 544 P.2d 1212, we held that three years was sufficient.

Third, in order for the similar act to be admissible, a common scheme, plan or system had to be established. In Just, 602 P.2d at 961, we provided that prior acts are those that have a similarity of inherent probability and a plan to carry out a scheme evidenced by defendant’s course of conduct.

In this case, defendant and his companions began a three-state trip with little or no money. They robbed a convenience store in Penshastin, Washington, to fund the excursion and, when the cash ran out, robbed the River’s Edge Motel in Alberton, Montana. In both instances, a black male threatened a store clerk with a gun and a white male, accompanied him. In both instances, defendant admittedly drove the getaway car. Each participant, had a specific duty to perform during both robberies. This establishes a modus operandi. The evidence of the former robbery was properly admitted because it was consistent with the proposition of a common scheme or plan by defendant and his companions to fund their travels by committing robberies.

Last, the probative value of the Penshastin robbery must not be outweighed by prejudice to defendant. This is the most difficult of the Just elements to apply. Evidence of other acts invariably will result in prejudice to the defendant to a certain degree and, thus, the probative value must substantially outweigh the prejudice. Just, 602 P.2d at 961. But, “the probative value of the evidence is determined from the remaining Just, factors.” State v. Keefe (Mont. 1988), [232 Mont. 258,] 759 P.2d 128, 135, 45 St.Rep. 1034, 1042.

In the instant case, there was little direct evidence to contradict defendant’s story that he was an unwilling and unknowing participant who was awakened after the robbery and told to drive the vehicle. Other acts evidence was crucial as it tended to show that defendant actively and knowingly participated in the Alberton robbery. The State effectively established the first three elements, therefore, establishing the probative value element.

The four Just elements must be considered as a whole, State v. T.W. (1986), 220 Mont. 280, 284, 715 P.2d 428, 430, and failure of any one factor will not necessarily negate admission of the evidence. Hall, 761 P.2d at 1285. See also, State v. Clausen (Mont. 1987), [228 Mont. 20,] 740 P.2d 679, 44 St.Rep. 1308.

The rationale behind Rule 404(b), M.R.Evid., is that proof of other offenses would subject defendant to surprise and to a defense of collateral or unrelated matters. Just, 602 P.2d at 960, citing Jensen, 455 P.2d at 633-34. Hence, if the State is going to introduce evidence of other acts under Just, defendant is afforded three procedural protections. In State v. Doll (1985), 214 Mont. 390, 395, 692 P.2d 473, 475-76, three procedural guidelines were set forth:

“(1) notice to the defendant prior to trial that evidence of other crimes, wrongs or acts will be introduced; (2) an admonition by the Judge to the jury when the evidence is introduced that it is admitted solely for one or more of the accepted purposes stated in Rule 404(b); and (3) a cautionary jury instruction to the same effect, providing in unequivocal terms that the evidence is admitted for the purpose earlier stated and not to try and convict the defendant for prior wrongful conduct.”

Citing Just, 602 P.2d at 963-64. See also, Hall, 761 P.2d at 1284-85.

In this case, the State, on February 10, 1988, properly filed notice of intent to introduce evidence of the Penshastin robbery in accordance with guideline number one. The District Court properly admonished the Jury in accordance with guideline number two by stating:

“Now, ladies and gentlemen, the State has just offered evidence that the defendant at another time engaged in other crimes, wrongs, or acts. That evidence was not admitted to prove the character of the defendant in order to show he acted in conformity therewith. The only purpose of admitting that evidence was to show plan, knowledge, or absence of mistake or accident. You may not use that evidence for any other purpose.”

A similar jury instruction satisfied the third guideline.

In applying its discretion, the District Court is obligated to carefully balance the relative probative value of the Penshastin robbery against the prejudice inherent in the evidence and the actual need to introduce the evidence. Just, 602 P.2d at 960-61. Citing State v. Skinner (1973), 163 Mont. 58, 64, 515 P.2d 81, 84; State v. Frates (1972), 160 Mont. 431, 437, 503 P.2d 47, 50. We hold that the District Court properly used its discretion.

We hold that no abuse of discretion by the District Court has occurred. The Penshastin robbery was properly admitted as an exception under Rule 404(b), M.R.Evid., since the Just elements were established. Defendant was properly afforded the three procedural safeguards as required.

Affirmed.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, SHEEHY, GULBRANDSON, WEBER and McDONOUGH concur.


source: Caselaw Access Project

author: MR. JUSTICE HARRISON MR. JUSTICE WEBER,

license: Public Domain

text:
    WENDI SCHENDEL and Dale W. Schendel, Plaintiffs and Appellants, v. BOARD OF ADJUSTMENT OF THE CITY OF BOZEMAN, Montana, and City of Bozeman, Montana, Defendants and Respondents.
    No. 88-519.
    Submitted on Briefs March 9, 1989.
    Decided May 4, 1989.
    Rehearing Denied June 15, 1989.
    774 P.2d 379.
    Richard J. Carstensen, Billings, for plaintiffs and appellants.
    Lineberger & Harris, Peter S. Lineberger, Bozeman, for defendants and respondents.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

This appeal arises from the July 18, 1988 decision of the District Court of the Eighteenth Judicial District, Gallatin County, Montana, and that court’s September 19, 1988 order refusing to reconsider and amend its order upholding the decision of the Board of Adjustments of the City of Bozeman (Board). We affirm.

This matter appeared in the District Court on a writ of certiorari and was returned to the Board for a full hearing on December 1, 1986. The case was ultimately submitted to the District Court upon stipulated facts, exhibits and issues, and on July 18, 1988, the District Court found in favor of the Board. Upon the court’s denial of appellants’ request for “reconsideration” they appeal to this Court.

In 1977, appellants Wendi and Dale Schendel (Schendels) purchased 2.7 acres in an R-S zone adjacent to the city of Bozeman. Shortly after the Schendels built their home they began to collect and care for various types of waterfowl. They initially began raising only a few birds and by 1986 gradually built up the bird population to 350 or more, especially during the summer months. While acquiring more and more waterfowl the Schendels spent over $35,000 in pens, ponds and fences to accommodate and control the various birds. The Schendels testified that they have arranged the ground level basement of their house to accommodate many of the ducks and geese during the winter months.

In 1985 an unsigned complaint was received by the Board concerning the waterfowl in the Schendels’ area. A hearing was held before the Board as a result of the determination and subsequent order of the Bozeman building official that the Schendels’ use of their property violated the Bozeman Municipal Zoning Code. This first hearing before the Board was held May 5, 1986. As a result of the May 5, 1986 hearing, the matter went to the District Court on a petition for writ of certiorari and was then returned to the Board for a full hearing. A transcript was taken at this second Board hearing held on December 1, 1986, which indicates a number of people appeared in support of the Schendels’ continuation of their homesite operation. There were also a number of other people who appeared objecting to the noises caused by the numerous ducks and geese heard throughout the major portion of the year. Some of the neighbors testified that they were awakened and kept awake from 2:00 a.m. and 3:00 a.m., particularly in the spring and fall of the year and that they had discussed this with the Schendels. The Schendels testified at the hearing that they did not realize there was much objection to the waterfowl and the resulting noise. The Schendels further testified that some of their operations were in conjunction with the Federal and State government in raising rare waterfowl.

As noted, the Schendels originally began their operation with very few ducks and geese but, when the population increased to over several hundred, it became “ducks unlimited” and the noise, combined with the unsanitary conditions of the waterfowl made an intolerable situation for some of the neighbors.

After the Board’s December 1, 1986 full hearing, it granted a variance which required the Schendels limit the number of birds on their property to only 40 resident birds, and 200 transient birds during the nesting period. The terms of the variance were made effective for two years or until their property was sold, which ever first occurred.

Following the first hearing on May 5, 1986, the Schendels filed a petition for a writ of certiorari in the District Court. The petition requested relief by certiorari under Title 27, Chapter 25, MCA, and under the zoning regulation, Section 18.66.080, of the Bozeman Municipal Zoning Code which provides:

“Any person or persons . . . aggrieved by any decision of the Board of Adjustment, or any taxpayer, or any officer, department, board or bureau of the municipality, may present to the court of record a petition, duly verified, setting forth that such decision is illegal in whole or in part specifying the grounds of illegality. Such petition shall be presented to the court within thirty days after the filing of the decision in the office of the Board.”

The Schendels allege that the District Court had before it not only their request for writ of certiorari relief, but also an appeal as to whether the Board’s decision was legal and that the District Court erred in deciding this case on only the first point.

The principal issue before the District Court and before this Court is whether the Board of Adjustment of the City of Bozeman acted outside its jurisdiction in granting a variance to the Schendels which imposed limits on the number of waterfowl the Schendels could raise; and whether the District Court properly approved the action of the Board.

The District Court received the writ of certiorari on stipulated facts which state as follows:

“1. Wendi Schendel and Dale W. Schendel, plaintiffs, are the owners of the following described property in Gallatin County, Montana:
“Lot 7 in Sourdough Ridge No. 2 Subdivision according to the official plat thereof, on file and of record in Book 1 of Plats, Page 30, Office of the Clerk and Recorder in such county.
“2. Wendi and Dale Schendel have raised water fowl and endangered birds on those premises since 1978. These activities progressively increased on the premises until about 1986. The Schendels’ property has carried, at times, as many as 350 water fowl; and the Schendels’ [sic] plan to indefinitely continue to have as many as 300 water fowl on the premises during the summer months.
“3. Pursuant to a notice by the defendant, Board of Adjustment of the City of Bozeman, a copy of which is attached as Exhibit ‘A’, plaintiffs appeared before such board on December 1, 1986.
“4. At the time of the hearing, the board received testimony and affidavits in support of the Schendels’ water fowl production, as well as testimony and affidavits in opposition of [sic] the granting of variance to Wendi and Dale Schendel ....
“5. At the hearing on December 1, 1986, the Board acknowledged that raising water fowl was an agricultural use as per the adopted definition listed under Section 18.04.030, accepted by the Board.
“6. Following testimony in the hearing, the board made a decision allowing the Schendels a variance for the raising of water fowl on the following conditions:
“ ‘The water fowl population on your property will not exceed 40 permanent birds, and 200 transient birds; the variance shall be for two years, or until the property is sold, whichever is first . . .’
“7. Plaintiffs [sic] property is located in zone R-S-2, that zoning allows by Section 18.12.020 a permitted use by any party of their property if it is for ‘agricultural purposes’. 18.04.03 defines agricultural use as:
“ ‘Agriculture means the tilling of soil, the raising of crops, horticulture and gardening, dairying or animal husbandry, including uses customary [sic] incidental thereto, but not including any agricultural industry or business such as fruit, plants, fur farms, animal hospitals, commercial feed lots, or similar use. . .’
“Section 18.12.020 also provides:
“J. The keeping of animals and fowl for family food production and the keeping of horses for private use, together with their dependent young as hereinafter set forth per two and one-half acres: one horse, or one cow, or two sheep, or two goats, or ten rabbits, or thirty-six fowl (chickens, pheasants, pigeons, etc.), or six larger fowl (ducks, geese, turkeys, etc.).”

It is the Schendels’ position that the Board recognized the use of their property was for agricultural purposes, yet the Board’s decision illegally restricted the number of waterfowl they could keep on their property. The Schendels cite a number of out-of-state cases pertaining to agricultural land use, but in view of the Board’s findings and the fact that the District Court upheld the Board in finding the Schendels’ property was being used for agricultural purposes, we hold that the Schendels’ argument and case law, while creative, is not persuasive.

This Court must consider whether the District Court, on certiorari, properly considered this matter under § 76-2-327, MCA, which provides that a district court may hold a hearing, take further evidence on the matter, “reverse or affirm, wholly or partly, or may modify the decision brought up for review.”

Section 76-2-304(2), MCA, sets forth the fundamental purposes of zoning:

“(2) Such [zoning] regulations shall be made with reasonable consideration, among other things, to the character of the district and its peculiar suitability for particular uses and with a view to conserving the value of buildings and encouraging the most appropriate use of land throughout such municipality.”

The above quoted sections from the Bozeman Municipal Zoning Code and Montana Code Annotated are of import to this case when considering the suitability of the presence of some 300 waterfowl in a suburban neighborhood adjacent to the City of Bozeman.

There are two levels of judicial review to be considered here: a review by the District Court of the Board’s decision, and a review by this Court of the District Court’s decision.

As to the review by the District Court, Montana law provides the procedures for a writ of certiorari in Title 27, Chapter 25, MCA. Section 27-25-303, MCA, states:

“The review upon this writ cannot be extended further than to determine whether the inferior tribunal, board, or officer has regularly pursued the authority of such tribunal, board, or officer.”

Under these provisions, the District Court’s function was to determine whether the Board’s action was legal and whether the Board acted within its jurisdiction. It is in this light that the case was presented to the District Court by the parties.

Under the provisions of § 76-2-327, MCA, and Section 18.66.080, Bozeman Municipal Zoning Code, numerous cases have set forth Montana law with respect to the full standard of review by a district court. See, Lambros v. Board of Adjustment of City of Missoula (1969), 153 Mont. 20, 452 P.2d 398, where this Court held that upon review of the district court’s decision on a variance question before a board of adjustment, the only question for this Court was whether an abuse of discretion was committed by the district court. See also, Whistler v. Burlington Northern (Mont. 1987), [228 Mont. 150,] 741 P.2d 422, 44 St.Rep. 1415.

This Court has established the principle that an abuse of discretion must be shown before the district court may set aside a board’s decision. See, e.g., Wheeler v. Armstrong (1975), 166 Mont. 363, 533 P.2d 964; Rygg v. Kalispell Board of Adjustment (1976), 169 Mont. 93, 544 P.2d 1228; and Cutone v. Anaconda-Deer Lodge (1980), 187 Mont. 515, 610 P.7d 691.

The Schendels have asked this Court to hold that the Board abused its discretion in issuing the order limiting the number of waterfowl they can raise on their property. It is not the function of this court to examine the wisdom of the Board’s decision if it is established that the Board acted within its jurisdiction and that its action was not illegal. The District Court upheld the Board’s decision and we find no abuse of discretion by the District Court.

As to the jurisdiction of this matter, we note the Schendels sought a review and reversal of the Board’s decision regarding their land use. However, the Board acted on the administrative appeal and limited its jurisdiction and decision to purely factual zoning matters. The Schendels fail to address or support the argument that the Board lacked jurisdiction to review the decision of the building official.

While agricultural uses are permitted under Section 18.12.020, sub-paragraph B, Bozeman Municipal Zoning Code, subparagraph J of that same code section provides:

“Permitted uses in the R-S district are as follows:
“J. The keeping of animals and fowl for family food production . . .: one horse, or one cow, or two sheep, or two goats, or ten rabbits, or thirty-six fowl (chickens, pheasants, pigeons, etc.), or six large fowl (ducks, geese, turkeys, etc.).”

The ruling by the Board appears liberal in view of the “six large fowl (ducks, geese, turkeys, etc.)” language contained as a limitation factor in the code section.

An integral part of the Bozeman Municipal Zoning Code is Chapter 18.66, entitled Board of Adjustment. Section 18.66.030 defines the powers and duties of the Board and states:

“A. The Board shall set its operating rules in accordance with MCA § 76-2-323, 1981, and shall have the following powers.
“1. To hear and decide appeals where it is alleged there is error in any order, requirement, decision, or determination made by an administrative official in the enforcement of this act or of any ordinance adopted pursuant thereto.
“2. To authorize upon appeal in specific cases such variance from the terms of this title as will not be contrary to the public interest, where owing to special conditions, a literal enforcement of the provisions will result in unnecessary hardship, and so that the spirit of this title shall be observed and substantial justice done.

The Board has the authority to hear appeals from the decisions of municipal administrative officers, which is the fact situation here. Section 18.66.060 of the Bozeman Municipal Zoning Code sets forth the criteria the Board must use when considering appeals. In approving applications of appeal, the Board designates such lawful conditions as will secure substantial protection for the public health, safety and general welfare. That section also provides that the Board’s findings and its decision will not be inconsistent with the intent and purpose of the Code. Similarly, the lawful conditions stated in any approval may include time periods and “[a]ny other conditions as will make possible the development of the City in an orderly and efficient manner and in conformity with the intent and purpose set forth in this chapter.” Section 18.66.060, subparagraph D(4), Bozeman Municipal Zoning Code.

We find the Board lawfully set forth limitations on the number of waterfowl allowed on the Schendels’ property and set a time limit for resolution of the matter in accordance with the specific statutory and ordinance mandates.

This Court has repeatedly held that statutes and ordinances will not be read so narrowly as to restrict the plain meaning of the whole law. See, Montana Automobile Association v. Greely (Mont. 1981), [_Mont__,] 632 P.2d 300, 306, 38 St.Rep. 1174, 1180, where this Court stated:

“If possible, subsections of a statute should be construed in a manner that will give effect to them all. . . This Court must reconcile conflicting statutory provisions and make them operative in accordance with the legislative intent, insofar as it is possible to do so . . . (Citations omitted.)”

This Court has established the rule of statutory construction that a statute derives its meaning from the entire body of words taken together. See, Crist v. Segna (Mont. 1981), [191 Mont. 210,] 622 P.2d 1028, 38 St.Rep. 150; Darby Spar, Ltd. v. Department of Revenue (1985), 217 Mont. 376, 705 P.2d 111; and Wyse v. District Court (1981), 195 Mont. 435, 636 P.2d 865.

The Schendels’ operation of a large noncommercial, waterfowl production facility presented the Board with an unusual situation. Clearly, under § 18.66.060 of the Bozeman Municipal Zoning Code, the Board rendered its decision by balancing the interests of the Schendels against the interests of upholding the zoning ordinance as a whole. In view of these facts, the District Court found the Board acted within its jurisdiction and that its decision was not illegal.

We hold that the Board of Adjustment had jurisdiction to place the restrictions as to the number of waterfowl and we affirm the decision of the District Court that the Board acted within its jurisdiction and in accordance with Montana law.

The decision of the District Court is affirmed.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES SHEEHY and HUNT concur.

MR. JUSTICE WEBER,

specially concurring:

I concur in the result reached by the majority that the Board of Adjustment has the power to reasonably restrict the number of waterfowl on plaintiffs’ property. However, I do not agree that the Board’s analysis of plaintiffs’ use of property was correct. I would therefore have reached the same conclusion but for different reasons.

Under the Bozeman Municipal Zoning Code, Section 18.04.020(b), agricultural use is defined as follows:

“Agricultural means the tilling of soil, the raising of crops, horticulture and gardening, dairying or animal husbandry, including customary uses incidental thereto, but not including any agricultural industry or business such as fruit, plants, fur farms, animal hospitals, commercial feed lots, or similar use.”

The Board concluded that the caring for wild waterfowl constituted an agricultural use. In apparent contradiction, the Board later concluded that the caring for wild waterfowl was similar to the keeping of fowl for family food production, and granted a variance under subsection J of the Zoning Code. While I disagree with the use of subsection J, I would approve the Board’s conclusion for the following reasons:

The definition of agricultural use under the Zoning Code emphasizes that it does not include agricultural industry or business such as fruit, plants, fur farms, animal hospitals, commercial feed lots, or similar use. The drafters recognized that these types of agricultural industry or business use might be thought of as being agricultural use but concluded that such use did not qualify as agricultural use under this Zoning Code. I would conclude that the raising of wild waterfowl is similar to such things as fur farms and animal hospitals and that it could be classed as a “similar use” as mentioned at the end of the agricultural use definition. This would of course mean that a variance would be required before the Schendels would be allowed to proceed with such a business.

The function of a variance is to grant relief to a property owner against strict compliance with the general law. See 1.01 C.J.S. Zoning, § 269. Montana case law has established that the following conditions be present before the granting of a variance is proper: (1) the variance must not be contrary to the public interest; (2) a literal enforcement of the zoning ordinance must result in unnecessary hardship owing to conditions unique to the property; and (3) the spirit of the ordinance must be observed and substantial justice done. Cutone v. Anaconda Deer Lodge (1980), 187 Mont. 515, 521, 610 P.2d 691, 695. I would conclude that these conditions have been met in the present case. I would therefore affirm the decision of the Board to limit the number of wild waterfowl on the Schendels property, concluding that it was an appropriate variance on the above described agricultural use theory. I agree with the majority that substantial justice was achieved by the decision of the Board.


author: MR. JUSTICE HUNT

text:
    In re the MARRIAGE OF CAROL C. DALLEY, Petitioner and Appellant, and MARK F. DALLEY, Respondent and Respondent.
    No. 89-03.
    Submitted on Briefs March 31, 1989.
    Decided May 4, 1989.
    As Revised May 10, 1989.
    773 P.2d 295.

      Davidson & Poppler, Doris M. Poppler, Billings, for petitioner and appellant.
    Cavan, Smith, Grubbs & Cavan, John J. Cavan, Billings, for respondent and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Carol Dailey, petitioner, appeals from the denial of her motion to compel satisfaction of judgment by the District Court of the Thirteenth Judicial District, Yellowstone County. We affirm in part and reverse and remand for further proceedings.

The following issues are raised on appeal:

1. Whether the District Court erred in finding that respondent did not accept appellant’s offer to satisfy the judgment by transferring stock instead of cash.

2. Whether appellant’s delivery of stock and cash to respondent tolls the interest on the judgment pending appeal.

Parties’ marriage was dissolved in April of 1987. On November 10, 1987, the trial court apportioned the marital estate between the parties and ordered appellant, Carol Dailey (wife), to pay respondent, Mark Dailey (husband), a sum of money necessary to pay husband 30% of certain assets within 30 days of judgment. The total amount to be paid to husband was $129,607.40. Wife appealed to this Court and husband cross-appealed under In Re Marriage of Dalley (Mont. 1988), [232 Mont. 235,] 756 P,2d 1131, 45 St.Rep. 1017. We affirmed the District Court’s judgment and denied husband’s petition for a rehearing on July 5, 1988.

The following facts were derived from the record and the various affidavits of the parties.

On July 25, 1988, wife’s attorney sent husband’s attorney a letter offering stock and a personal check to husband in satisfaction of the judgment. Husband’s attorney was out of town when the letter was received by his firm. He returned on August 2, 1988. On that day, husband, with permission of his attorney, spoke with wife’s attorney by telephone who asked him if he was aware of the July 25, 1988, letter. He said that he was and that the proposal appeared all right but that he wanted to consult his attorney before agreeing to the proposal. On August 3, 1988, the attorneys discussed the conversation wife’s attorney had with husband.

On the morning of August 4, 1988, wife signed over 1,668 shares of Amoco stock, with a value of $124,266.00, and executed a personal check for the excess due in the amount of $5,341.40 to husband. Early that afternoon, wife’s attorney called husband to confirm the stock substitution. Husband stated that he could not accept the stock offered in satisfaction of the judgment because of the tax consequences associated with it. Wife’s attorney then delivered the stock to husband’s attorney’s office late that afternoon despite her earlier conversation with husband. Husband’s attorney was not present when delivery was made.

After a discovery deposition was held on August 10, 1988, parties’ attorneys discussed the substitution of stock in lieu of cash. Thereafter, husband’s attorney consulted a tax attorney on the matter. On August 23, 1988, wife’s attorney called husband’s attorney and inquired into the status of the property settlement. Husband’s attorney stated once again that because of the tax burden accompanying the stock, it would not be accepted in satisfaction of the judgment. Wife’s attorney then filed a motion to compel satisfaction of the judgment. The motion was denied on October 26, 1988.

The first issue raised on appeal is whether the District Court erred in finding that respondent did not accept appellant’s offer to satisfy the judgment by transferring stock instead of cash.

In the District Court decree of November 10, 1987, it ordered that wife pay:

“a sum of money necessary to pay to husband 30% of the value of [certain] assets ... the sum of $129,607.40. Deeds, titles, checks and such other documents as may be necessary to accomplish this shall be executed and delivered within thirty days of this order. (Emphasis added.)”

Wife wished to substitute stock for the money judgment. The actual issue at bar is whether an oral contract existed between husband and wife which authorized the substitution. Under § 28-2-102, MCA, the essential elements of a contract are:

(1) identifiable parties capable of contracting;

(2) their consent;

(3) a lawful objective;

(4) sufficient cause or consideration.

Here, only element two, consent, is contested. “There can be no binding contract without mutual consent of the parties.” Christenson v. Billings Livestock Com’n Co. (1982), 201 Mont. 207, 210, 653 P.2d 492, 494. Consent must be free, mutual and communicated. In terstate Production Credit Ass’n v. Abbott (Mont. 1986), [223 Mont. 405,] 726 P.2d 824, 826, 43 St.Rep. 1829, 1832. Further, consent is established when there has been an offer and an acceptance of that offer. Modern Machinery v. Flathead County (1982), 202 Mont. 140, 144, 656 P.2d 206, 209.

In the instant case, the court ordered wife to pay the sum due, $129,607.40, in money. She offered, instead, to transfer to husband 1,668 shares of Amoco stock valued at $74.5 per share, totaling $124,266.00, coupled with a $5,341.40 personal check to make up the excess due. On July 25, 1988, wife’s attorney sent husband’s attorney the following letter:

“On behalf of Carol Dalley, we will deliver to you on August 5, 1988, 1,668 Amoco shares valued at 74.5 per the valuation fixed in the decree. In addition we will submit a check for the difference in the amount of $5,341.40 payable to your firm and Mark Dalley.”

Wife argued that the letter effectuated a valid offer. Husband disagreed contending that the letter was not an offer but merely a notification of something wife intended to do in the future. We disagree. An offer is:

“The manifestation of willingness to enter into a bargain, so made as to justify another person in understanding that his assent to that bargain is invited and will conclude it.”

Restatement (Second) of Contracts, § 24 (1979).

Wife’s attorney’s letter of July 25, 1988, clearly constitutes an offer. Wife communicated her proposal and husband understood it as evidenced by his statement on August 2, 1988, that the offer appeared all right but that he needed to consult his attorney first.

However, the offer must be accepted before a contract is formed. In Kuchinski v. Security Gen. Ins. Co. (1963), 141 Mont. 515, 519, 380 P.2d 889, 891, we stated that in order to effectuate a contract, there must not only be a valid offer by one party but also an unconditional acceptance, according to its terms, by the other. See also, Beale v. Lingquist (1932), 92 Mont. 480, 488, 15 P.2d 927, 930.

Wife claims that husband telephoned wife’s attorney on August 2, 1988, and unequivocally accepted the offer on the condition that the $5,341.40 check be paid to him alone and not his attorney. She states that this conditional acceptance was confirmed the next day with husband’s attorney. Wife argues that she not only met the condition but then relied on it as an acceptance and transferred the stock certificates into husband’s name the morning of August 4, 1988. She further claims that it was not until August 23, 1988, that husband rejected the stock and that the rejection came too late since the oral contract was formed on August 2, 1988.

Section 28-2-503(2), MCA, provides:

“A voluntary acceptance of the benefit of a transaction is equivalent to a consent to all the obligations arising from it, so far as the facts are known or ought to be known to the person accepting.” (Emphasis added.)

Here, husband asserts that his August 2, 1988, telephone conversation with wife’s attorney was not an acceptance because he clearly stated that although the offer appeared all right, he would first have to consult with his attorney on the matter. Husband did so consult his attorney. At that point, it is clear that husband was merely considering the offer and made no acceptance.

In Chadwick v. Giberson (1980), 190 Mont. 88, 92, 618 P.2d 1213, 1215, we held that, “It is a well-established rule that there must be mutual assent or a meeting of the minds on all essential elements or terms to form a binding contract.” Here, husband did not intend to accept the offer on August 2, 1988, because he conditioned the acceptance pending consultation with his attorney. Thus, the contract of August 2, 1988 lacked mutual assent.

Prior to delivery of the stock, husband was informed that although there would be no tax liability associated with the transfer of stock from wife to husband, there would be a serious tax liability should husband then sell the stock. The tax burden made the purported value of the stock much lower than he originally expected. On the morning of August 4, 1988, wife’s attorney telephoned husband and he told her that he absolutely could not accept the stock that was offered in satisfaction of the judgment because of the tax burden.

Further, although wife’s letter stated that the stock would be delivered on August 5, 1988, she delivered it in the late afternoon of August 4, 1988, despite her earlier conversation with husband. The stocks were received by a partner of husband’s attorney as he was not in the office at that time.

On August 10, 1988, husband’s attorney participated in a discovery deposition at which wife’s attorney was a witness. Afterwards, parties’ attorneys once again discussed whether stock would be sufficient to satisfy the judgment. Shortly thereafter, husband’s attorney consulted a tax attorney who warned him of the liability problems upon transfer.

On August 23, 1988, wife’s attorney telephoned husband’s attorney regarding the status of the property distribution. She was again told that the stocks would not be accepted to satisfy the money judgment.

There is substantial evidence to support the District Court’s finding that there was no meeting of the minds on August 2, 1988, or any other date, and thus, no oral agreement by husband to accept stocks in satisfaction of the judgment. See, Diede v. Davis (1983), 203 Mont. 205, 212, 661 P.2d 838, 841.

“Where the existence of an oral contract is contested and the evidence is conflicting, the existence of the contract is a question for the trier of fact.”

Como v. Rhines (1982), 198 Mont. 279, 284, 645 P.2d 948, 950-51. See also, Keil v. Glacier Park, Inc. (1980), 188 Mont. 455, 460, 614 P.2d 502, 505. The District Court properly considered the evidence and found that no contract existed.

The second issue raised on appeal is whether wife’s delivery of stock and cash to respondent on August 4, 1988, tolls the interest on the judgment pending appeal.

The District Court’s order of October 26, 1988, reads:

“Since Mr. Dailey did have some culpability in the transaction, Mrs. Dailey might be entitled to a cancellation of interest on the judgment from the date the stock was tendered through the date of this order.”

Wife argues that since husband is still in possession of the stock that he should not be able to collect any post-judgment interest after August of 1988. However, wife delivered the stock, never demanded it back, and never made any attempt to recover it. Husband has received no dividends or other benefits from holding the stock. We find no merit in this contention as husband was not culpable.

The parties were granted a stay of execution of judgment pending appeal. The stay does not affect interest due. In Knudson v. Knudson (Mont. 1981), [191 Mont. 204,] 622 P.2d 1025, 1026-27, 38 St.Rep. 154, 156-57, where the husband, in a dissolution action, moved the court for a stay of execution, we held that interest was to be awarded from the date of judgment in the divorce action despite the existence of the stay of execution. Hence, the stay of execution has no effect on interest due in the present case.

Further, Rule 31, M.R.App.P., provides in part:

“If a judgment for money in a civil case is affirmed, whatever interest is allowed by law shall be payable from the date the judgment was rendered or made in the district court.”

In Re Marriage of Gibson (1983), 206 Mont. 460, 671 P.2d 629, states that interest accrues at the statutory rate from the date on which payment is due — in the present case, the date of judgment — until the date on which payment is made. Under § 25-9-205(1), MCA, the statutory interest rate is 10% per annum payable on judgments recovered in Montana. The rate must not be compounded.

Therefore, wife is to pay husband $129,607.40, the amount due and owing. Interest on that amount is to be calculated from November 10, 1987, the date of judgment, to the date of this order. Interest is to be paid in accordance with § 25-9-205(1), MCA.

Affirmed in part and reversed and remanded for further proceedings in accordance with this Opinion.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, SHEEHY and WEBER concur.


author: MR. JUSTICE GULBRANDSON

text:
    In re the MARRIAGE OF FRANCISCO IVAN MORAZAN, Petitioner and Respondent, and VICKI LYNN KENDALL, Respondent and Appellant.
    No. 88-530.
    Submitted on Briefs March 31, 1989.
    Decided May 5, 1989.
    772 P.2d 872.

      Cannon & Sheehy, Edmund F. Sheehy, Jr., Helena, for respondent and appellant.
    Miller & Cook, Joan E. Cook, Great Falls, for petitioner and respondent.
   MR. JUSTICE GULBRANDSON

delivered the Opinion of the Court.

Appellant Vicki Lynn Kendall (Kendall) appeals the July 13, 1988, order of the Eighth Judicial District Court, Cascade County, modifying a divorce decree entered on January 28, 1984. The modification order removed Kendall’s children, M.M. and F.M., from her sole custody and granted joint custody of the children to Kendall and the children’s natural father Francisco Ivan Morazan (Morazan), the respondent, with primary physical custody in Morazan. We affirm the modification order of the District Court.

Kendall and Morazan were married in October 1980. At that time Kendall had three children, two sons and one daughter, R.B. These children lived with Kendall and Morazan. Two children were born during the marriage, M.M. in 1981 and F.M. in 1983. In 1983, Kendall made allegations of sexual abuse of R.B. against R.B. ‘s natural father. These allegations arose in the midst of a custody battle between Kendall and R.B.’s natural father. Investigations by child welfare workers disclosed that R.B. may have been sexually abused by both her natural father and Morazan. The District Court modified custody of R.B., shifting custody from Kendall to R.B.’s natural father. Kendall was permitted reasonable visitation privileges, provided R.B. had no contact with Morazan.

Kendall filed for and was granted a dissolution of her marriage to Morazan. Morazan did not contest the dissolution proceedings, the award of sole custody of their two children to Kendall, or the child support payments of $125 per month per child. The order of dissolution granted Morazan reasonable visitation rights.

Subsequent to the dissolution in January 1984, Kendall began living with one Doug Owens. She later married Owens and moved with him to Lolo, Montana. Morazan exercised his visitation rights and paid the required child support.

In September of 1986, after Owens physically abused Kendall, she contacted Morazan requesting he move her and her children back to Great Falls. Morazan did so, at his own expense, relocating Kendall and the children across the street from his residence. Approximately one month later, Owens moved back in with Kendall, staying approximately six months. Kendall then divorced Owens. She had begun seeing another man, Dale Reeves. .After divorcing Owens, Kendall moved with Reeves to Canyon Ferry, Montana, and then to East Helena, Montana.

In February 1988, Kendall had problems with the principal at her daughter’s school and with Dale Reeves and called Morazan to help her and her children move back to Great Falls. She felt she needed a “cooling-off period” in her relationship with Reeves. Morazan moved them back to Great Falls to his house where they stayed for a month before Kendall and the children moved to another location in Great Falls.

Morazan testified at the modification hearing that Kendall had confided in him that Reeves’ thirteen-year-old son had been physically abusing her. She also told Morazan that her two older boys had been having inappropriate sexual contact with M.M. and that Reeves’ son told her sons that he had this type of contact with his sister.

Morazan filed a combination affidavit and petition for modification of custody on May 17, 1988. He also obtained a temporary restraining order to prevent Kendall from removing their children from the jurisdiction of the court.

On May 23, 1988, Kendall removed M.M. from the kindergarten she was attending in Great Falls and moved both children to East Helena where they moved back in with Reeves. At the time of the June 7, 1988, hearing, which Kendall attended without counsel, she was living with Reeves and five children in a two bedroom apartment. The District Court found cause to hold a hearing regarding Morazan’s petition for modification of custody and set a hearing date for June 16, 1988.

Between the date of the June 7, 1988, hearing and the June 16, 1988, hearing, M.M. reportedly confided to Kendall that Morazan had sexually abused her. Kendall reported this to Lewis and Clark County authorities,' who determined not to file any charges before the modification hearing. At the hearing, both parties testified and presented additional witnesses. The judge also interviewed M.M. in his chambers at the end of the hearing.

The court issued its findings of fact, conclusions of law, and order on July 13, 1988. The court concluded that the children’s existing environment constituted serious endangerment to their mental, moral, and emotional health; that the harm likely to result from a change in their environment was outweighed by the advantages of the change; and that modification of the custody order contained in the divorce decree was in the best interests of the children. The court then modified the custody order, granting joint custody, placing primary physical custody with Morazan, and ordering no child support. It is from this order of the court that Kendall presents the following issues on appeal:

1. Did the District Court err in issuing the temporary restraining order and holding the show cause hearing on the petition to modify custody?

2. Does substantial credible evidence exist to support the District Court’s order modifying custody?

The first issue Kendall raises is that the District Court erred in issuing a temporary restraining order restricting her from removing the children from the jurisdiction of the court. Kendall contends there was no reason for the court to believe she intended to remove the children from the state.

The court issued the temporary restraining order based upon the duly sworn affidavit of Morazan. This affidavit stated that the temporary restraining order was necessary to prevent Kendall from removing the children from the jurisdiction of the court. The affidavit further alleged that Kendall had threatened to remove the children from the court’s jurisdiction should Morazan ever seek modification of the custody order. We find that such a sworn statement was sufficient grounds for issuing a temporary restraining order, in light of the circumstances surrounding such proceedings and the minimal inconvenience such an order placed upon Kendall. See § 40-4-220(1), MCA.

Kendall also contends the petition for modification and supporting affidavit failed to provide adequate cause for hearing the motion under § 40-4-220(1), MCA. Kendall claims the reasons presented in Morazan’s affidavit were that Kendall had changed her residence on numerous occasions and was on welfare. While these grounds alone would be insufficient to establish adequate cause for a hearing, they were not the only cause contained in the affidavit. The affidavit also stated that Kendall had previously exposed the children to an abusive relationship while married to Owens, a relationship to which she had returned. Further, the affidavit stated that Kendall was currently involved in another relationship which exposed the children to a sexually abusive situation. We conclude these statements constituted adequate cause to order a hearing on the custody status of M.M. and F.M.

Kendall’s second issue is whether the evidence introduced at the hearing was sufficient to warrant a modification of the custody arrangement. Initially, we note that the primary responsibility for child custody decisions lies with the District Court. We will presume the District Court’s decision is correct and not disturb it unless “there is a mistake of law or a finding of fact not supported by credible evidence.” In re Marriage of Robbins (1985), 219 Mont. 130, 134-35, 711 P.2d 1347, 1350, citing Solie v. Solie (1977), 172 Mont. 132, 137, 561 P.2d 443, 446; see also Rule 52(a), M.R.Civ.P. which provides that a finding must be clearly erroneous before it may be overturned).

A district court must make certain determinations before modifying a prior child custody decision. Section 40-4-219, MCA. First, the court must find, based upon facts arising since the prior decree or unknown to the court at the entry of the prior decree, that a change has occurred in the circumstances of the child or custodial parent which necessitates a modification to serve the best interests of the child. Section 40-4-219(1), MCA. Further, the court must find that the child’s present environment seriously endangers the child’s physical, mental, moral, or emotional health and that the harm likely to be caused by a change in environment is outweighed by the advantages to the child from such a change. Section 40-4-219(1)(c), MCA.

The record shows that the court had adequate reason to find that circumstances had changed since the dissolution decree issued. Kendall’s lifestyle indicated an inability to maintain a stable environment for her children. At the time of the modification hearing, she was living with another adult and five children in a two bedroom apartment. Further, Kendall has shown little concern for M.M.’s education. Her removal of M.M. from kindergarten in Great Falls two weeks before the end of the term shows a lack of regard for the necessity and value of her child’s education. These facts, as well as the allegations that M.M.’s stepbrothers sexually abused her, indicate changed circumstances.

These changed circumstances are sufficient to show that the physical, mental, moral, and emotional health of M.M. and F.M. would be seriously endangered if they remained with Kendall. See § 40-4-219(l)(c), MCA. We therefore agree with the District Court as to the dangers posed by the environment in which Kendall has placed her children. The advantages to the children under Morazan’s custody, on the other hand, clearly outweigh any harm which would accompany a change in their environment. Morazan currently lives alone in a two bedroom house with a backyard in which the children may play. He has a stable job with the U.S. Post Office, and he is attending the College of Great Falls in hopes of bettering his life. He has exhibited concern for the children’s educational opportunities and the need for testing M.M. for possible learning disabilities. His work and schooling will require baby-sitters to care for his children, but he has made arrangements to secure qualified people to do so.

This Court has some reservations regarding Morazan’s fitness as the custodial parent because of allegations that he sexually abused M.M. Proof of the validity of these allegations would clearly result in Morazan being unsuitable to take unsupervised custody of the children. Morazan, however, has denied these allegations. The District Court questioned because of the timing of the charges as well as Morazan’s denial, whether the charges were valid. The court noted that Kendall has been involved in two cases concerning the custody of her children, and in both she has alleged sexual abuse on the part of the natural father. The District Court was in the best position to question and observe Kendall and M.M., and we therefore yield to its evaluation of the validity of the sexual abuse charges.

The modification order of the District Court is affirmed.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, WEBER, McDONOUGH and HUNT concur.

MR. JUSTICE SHEEHY did not participate in this opinion.


author: MR. JUSTICE WEBER

text:
    JOSEPH VARELA, Claimant and Respondent, v. EXXON, U.S.A., BILLINGS, REFINERY, Employer, and Petroleum Casualty Company, Defendant and Appellant.
    No. 88-421.
    Submitted on Briefs Jan. 12, 1989.
    Decided May 9, 1989.
    Rehearing Denied June 1, 1989.
    773 P.2d 299.

      Crowley Law Firm, Terry Spear, Billings, for defendant and appellant.

      Whalen & Whalen, Michael J. Whalen, Billings, for claimant and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

Both Joseph Varela (claimant) and Petroleum Casualty Company (insurer) appeal a decision of the Workers’ Compensation Court allowing in part and denying in part a compensation claim filed by Mr. Varela against his employer, Exxon, U.S.A. The claimant appeals that portion of the decision denying his claim based on the running of the statute of limitations, along with several other issues. The insurer appeals that portion of the decision allowing compensation for a second injury following the claimant’s return to work. We affirm in part and reverse in part, holding that the claimant has suffered a compensable injury and remanding for a determination of benefits.

The issues are:

1. Did the court err in holding that the claim for compensation arising from the below-the-knee amputation is barred by the statute of limitations?

2. Did the court err in holding that the claimant suffered one or more compensable injuries following the below-the-knee amputation which resulted in his inability to return to his previous employment?

3. Did the court err in refusing to consider the claimant’s deposition as part of the record?

4. Did the court err in holding that there was no evidence by which it could establish the claimant’s disability and compensation rate for the second injury?

5. Did the court err in holding that the claimant was not entitled to a 20% penalty increase in award for unreasonable withholding of benefits?

In August of 1979, Mr. Varela was involved in a vehicle accident between the motorcycle he was operating and a pickup truck. This accident was not in any way related to his employment. As a result, Mr. Varela suffered severe injuries to his right foot which was amputated in November of 1979. The surgical procedure, known as a Syme’s amputation, involved the removal of the foot at the ankle while preserving the pad on the heel to serve as the base of a stump. At the time of the accident, Mr. Varela was an employee of Exxon, U.S.A., at the Billings refinery. Following the foot amputation he was fitted with a prosthesis, or artificial limb, and returned to work for Exxon in April of 1980.

Mr. Varela’s job required him to climb steel stairs on various structures including towers, tanks, pipelines, and boilers to install insulation. He was also required to lift 50 to 100 pound sacks of insulation material, and to walk and stand for prolonged periods on concrete and uneven surfaces. These duties continued until 1983 when he was assigned to operating a vacuum truck which required him to drag and pull heavy hoses to and from the truck. Following his return to work in 1980 and continuing until 1985, Mr. Varela experienced increasing discomfort and pain with his prosthesis. He had difficulty in climbing, walking and standing for prolonged periods, and the sores which developed on his stump would not heal.

In November, 1985, the claimant went to see Dr. Dorr, an orthopedic surgeon. Dr. Dorr indicated that Mr. Varela should have a different type of prosthesis or should undergo a below-the-knee amputation (B/K amputation). Mr. Varela sought a second opinion from Dr. Kobold, also an orthopedic surgeon, who recommended the B/K amputation to alleviate the problems Mr. Varela was having with his stump. Dr. Kobold diagnosed sympathetic dystrophy and medial and lateral bone spurs. He described sympathetic dystrophy as a reaction of the sympathetic nervous system to either the accident or the Syme’s amputation or both, which causes pain, burning, or clamminess in the area. To relieve these discomforts, Dr. Kobold performed the B/K amputation on December 3, 1985. Mr. Varela later received a B/K prosthesis and returned to work for Exxon in May of 1986. He continued in his employment until he was released in November of 1986.

During the period of May to November of 1986, the claimant had problems with balance and stability, and continued to experience pain and discomfort with his prosthesis while he was working. He testified that he fell several times while on the job in November 1986. He went to see Dr. Kobold in December because he had fallen twice and broke his prosthesis. The doctor wrote a letter to “whom it may concern” at Exxon, directing that the claimant’s work activities should be restricted because of “pressure points and pain in his stump (due to) the amount of the following activities that he has been doing.” These restricted activities included prolonged standing or walking, squatting, and heavy lifting or carrying.

Upon receiving the letter, Exxon discharged Mr. Varela from employment because he was no longer able to perform those activities necessary to his employment. Exxon had no other positions available at that time which might have been more suitable to Mr. Varela’s abilities. Following the medical termination, the record shows that the claimant was entitled to and received six months of disability payments equivalent to his wages pursuant to his negotiated contract of employment. After six months, those payments were reduced by half and were to continue indefinitely. In April of 1987, Mr. Varela filed his claim for compensation.

I

Did the court err in holding that the claim for compensation was barred by the statute of limitations?

The relevant statute of limitations for a compensation claim is found at § 39-71-601, MCA:

“(1) In case of personal injury or death, all claims shall be forever barred unless presented in writing to the employer, the insurer, or the division, as the case may be, within 12 months from the date of the happening of the accident, either by the claimant or someone legally authorized to act for him in his behalf.
“(2) The division may, upon a reasonable showing by the claimant of lack of knowledge of the disability, waive the time requirement up to an additional 24 months.”

The Workers’ Compensation Court determined that the B/K amputation was necessitated by the work-related aggravation of the claimant’s Syme’s stump, and was therefore compensable. The court found, however, that the B/K amputation took place on December 3, 1985, and that the claim was not filed until April 2, 1987. Based on this 16 month delay, the court concluded that the claimant had not met the statutory limitation period and the claim was barred. The court also determined that it did not have jurisdiction under § 39-71-601(2), MCA, to extend the filing date by 24 months. The claimant does not find error with the latter determination so it will not be addressed on appeal.

Mr. Varela argues that even though he did not comply with the 12 month requirement of the statute, the limitation period should be tolled to allow his claim. This Court has tolled the statute of limitations for a compensation claim where a claimant can show that: (1) disability benefits have been received from the employer which are “sufficient to convince the recipient that he is receiving such a large percentage of workers’ compensation benefits available to him that to seek further benefits would be a wasted effort;” and (2) the employer has knowledge that the claimant’s inability to work was due to an industrial injury. Frost v. Anaconda (1982), 198 Mont. 216, 221-22, 645 P.2d 419, 422-23.

The Workers’ Compensation Court found that the claimant presented no evidence to fulfill either of the requirements from Frost so as to toll the statute of limitations. We will not overturn that finding if there is substantial evidence in the record upon which to support it. Giacoletto v. Silver Bow Pizza Parlor (Mont. 1988), [231 Mont. 191,] 751 P.2d 1059, 45 St.Rep. 536. The record shows that Mr. Varela did receive full disability benefits from his employer after his medical termination in December of 1986, but that proof is not relevant to the present inquiry. Mr. Varela failed to submit substantial evidence that he received disability benefits which were sufficient to convince him that he was receiving an equivalent to workers’ compensation during the period of December 1985 to December 1986. We therefore conclude that the lower court correctly determined that claimant had not met the first element of the test from Frost.

The Workers ‘ Compensation Court also concluded that the employer had no knowledge that the disability payments were related to an industrial accident, and as a result that Mr. Varela had failed to meet part two of the Frost test. While the evidence indicates that Exxon knew Mr. Varela’s physical condition was causing him problems at work, we agree with the lower court that there is a difference between that kind of knowledge and the kind of knowledge contemplated by this Court in Frost. Under Frost, the employer must have had knowledge that Mr. Varela’s physical pain and discomfort was compensably related to his job. We have reviewed the record and conclude that there is no indication that Exxon had knowledge that the claimant’s original injury was aggravated by work-related activities so as to become compensable. We hold that the claimant has not presented evidence sufficient to fulfill either of the requirements from Frost. The lower court’s conclusion that the claim is barred by the statute of limitations is affirmed.

II

Did the court err in holding that the claimant suffered one or more compensable injuries following the below-the-knee amputation which resulted in his inability to return to his previous employment?

The lower court determined that Mr. Varela sustained a “compensable event” following his return to work after the B/K amputation which was not barred by the statute of limitations. To be compensable, the claimant is required to prove that he suffered an injury while in the scope of employment, “injury” being defined as:

“(1) a tangible happening of a traumatic nature from an unexpected cause or unusual strain resulting in either external or internal physical harm and such physical condition as a result therefrom

Section 39-71-119, MCA (1985).

The court did not identify one specific incident of accident or injury, but considered a number of events following Mr. Varela’s return to work which culminated in a “tangible happening and resultant physical harm.” The events which the court referred to included the claimant’s on-the-job activities which irritated his stump, the instability he experienced which caused him to fall on several occasions, and two falls in November of 1986 which broke his prosthesis and caused severe pain. The court concluded that it was Mr. Varela’s second injury which led to his medical termination by the employer.

The insurer argues that it was error for the Workers’ Compensation Court to tie Mr. Varela’s inability to continue his employment to his “injuries” in 1986, referring to the two falls in November. The insurer contends that it was the B/K amputation which caused his inability to work rather than anything which was connected to or occurred at work.

Presumably, the claimant could have performed his job without difficulty if it weren’t for the prosthesis. Similarly, if it weren’t for the strenuous activities required by that job, Mr. Varela may not have experienced pain or a broken prosthesis. It is not our duty to weigh the evidence in this regard. The Workers’ Compensation Court traced the claimant’s inability to work to the events which followed the B/K amputation and his return to work. That determination will be upheld if supported by substantial credible evidence.

Both the claimant and Dr. Kobold testified as to the pain and discomfort caused by the work-related activities. The claimant testified that the pain he experienced with his B/K prosthesis also affected his back, and his other knee and ankle. In addition, the claimant felt unstable when trying to perform his duties such as climbing on and off the vacuum truck. He fell on two occasions and broke his prosthesis because of the instability. Dr. Kobold wrote a prescription for a new prosthesis and restricted the claimant’s activities at work. Subsequently, the claimant was discharged from employment. We hold that this evidence is sufficient to support the lower court’s conclusions that Mr. Varela suffered a compensable injury following his return to work in May of 1986.

Ill

Did the court err in refusing to consider the claimant’s deposition as part of the record?

Mr. Varela argues that the court should have considered his deposition as part of the evidentiary record. Upon defendant’s objection, the court refused to consider the deposition as part of the record “due to the claimant’s failure to abide by the Montana Rules of Evidence.” While the court acknowledged that the deposition had been filed, it noted that no deposition testimony was offered by the claimant at trial, nor was it incorporated into the record except in the claimant’s reply brief, and the claimant did not request its inclusion until after the trial.

The relevant portion of the deposition contains testimony by Mr. Varela about statements made to him by his supervisor while he was hospitalized after the B/K amputation. Those statements are alleged assurances by the employer that Mr. Varela would have nothing to worry about as far as his job or any litigation was concerned, so that he was lulled into a sense of false security and therefore did not file a timely claim for compensation. In anticipation of this testimony at trial, the insurer was prepared to call the supervisor to rebut Mr. Varela’s testimony regarding the out-of-court statements. However, no mention of the statements was made by the claimant at trial. Instead, the claimant waited until after trial to bring forth evidence of the alleged assurances.

The statements contained in Mr. Varela’s deposition fall into the definition of hearsay:

“Hearsay is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”

Rule 801(c), M.R.Evid. Generally, hearsay is inadmissible unless it falls into one of the exceptions in Rule 803 or 804, M.R.Evid. Mr. Varela’s deposition testimony could have been admissible as former testimony under Rule 804(b)(1), but he would have had to show his unavailability as a witness. Since Mr. Varela testified at trial, that portion of the deposition testimony would have been inadmissible.

Had Mr. Varela testified at trial as to the alleged assurances, the defendant would have had the opportunity to rebut that testimony. To allow the testimony by deposition would effectively deny the insurer any opportunity to challenge those statements made by Mr. Varela in his deposition. We note that broad discretion is given to the lower court in admitting or refusing to admit evidence. Britton v. Farmers Insurance Group (Mont. 1986), [221 Mont. 67,] 721 P.2d 303, 315, 43 St.Rep. 641, 654. Given this discretion, we conclude that it was not reversible error for the Workers’ Compensation Court to exclude the claimant’s deposition from the evidentiary record.

IV

Did the court err in holding that there was no evidence by which it could establish the claimant’s disability and compensation rate for the second injury?

Having concluded that the claimant suffered a job-related injury after returning to work following the amputation, it was for the Workers’ Compensation Court to determine what disability and benefits Mr. Varela was entitled to. However, the court concluded that it was unable to do so because there was little evidence in the record to show what disability entitlement the claimant should receive. Based on the medical evidence, the court found that Mr. Varela could no longer work at the refinery, but noted that finding alone would not warrant payment of compensation. The court concluded that it would be necessary for the claimant to establish what labor market, if any, would be available given his injury, age, occupational skills, education and experience.

The record established that Mr. Varela’s formal education was limited to high school. During his youth he worked as a farm laborer, doing beet labor and ditch digging. Mr. Varela testified that he is no longer able to perform any of those duties by reason of his amputation. Following graduation from high school, he worked for Exxon for one year before entering the military. Mr. Varela testified that he was trained as a small arms combat infantryman and learned nothing in his training which he could transfer to civilian work. After three years of military service, he returned to work for Exxon for eleven years until his medical termination in 1986. Mr. Varela testified that he has had no formal training or education to upgrade his employment skills, nor has he engaged in any other type of employment.

The Workers’ Compensation Court was impressed with the “tenacity, intelligence, and the obvious strong work ethic of the claimant.” The court marveled at how, for some six years, claimant could even perform many of his job duties with his handicap.

The record established that Mr. Varela’s employment experience was limited to Exxon and farm labor, and the uncontradicted evidence established that he is unable to perform those types of work. We conclude that by the establishing of those facts, the Claimant met his initial burden of showing that because of his work related injury, he no longer is able to perform the duties associated with those jobs which constitute his normal labor market. Coles v. Seven Eleven Stores and American Motorists Insurance Co. (1985), 217 Mont. 343, 704 P.2d 1048, 1051, 42 St.Rep. 1238, 1241.

When claimant established that he is unable to perform those jobs within his normal labor market, the burden shifted to the employer to show that Mr. Varela has reasonable pros-pects of employment so that he is not entitled to total disability benefits. Coles, 704 P.2d at 1051. We are reluctant to reverse the Workers’ Compensation Court on a factual determination. However, the facts in this record, as summarized above establish without significant contradiction that Mr. Varela has no reasonable prospects of employment. We conclude that the burden then shifted to the employer to demonstrate otherwise, and further conclude that an additional hearing is required for the submission of proof on this issue. This case is remanded for such further proceedings as are required by the Workers Compensation Court in order to make a determination of entitlement which is consistent with this opinion.

V

Did the court err in holding that the claimant was not entitled to a 20% penalty increase in award for unreasonable withholding of benefits?

The claimant argues that the Workers’ Compensation Court should have awarded the 20% penalty allowed by § 39-71-2907, MCA (1985), because he contends that the employer was aware that Mr. Varela’s injury was work-related as early as 1985. The record discloses that the employer was aware of Mr. Varela’s discomfort and his difficulty in performing his work-related duties. That awareness, however, is not analogous to a knowledge that the injury was compensably related to work. We hold that the claimant is not entitled to the 20% increased penalty.

We affirm the decision of the Workers’ Compensation Court with respect to the running of the statute of limitations on the first claim, the compensability of the second claim, the exclusion of the claimant’s deposition from the record, and the disallowance of the 20% penalty. With respect to the issue of disability benefits on Mr. Varela’s compensable second injury, we remand for a determination of benefits which is consistent with this opinion.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, SHEEHY, McDONOUGH and GULBRANDSON concur.

MR. JUSTICE HUNT did not participate in this opinion.


author: MR. JUSTICE WEBER MR. JUSTICE SHEEHY,

text:
    STATE OF MONTANA, Plaintiff and Appellant, v. ANNETTE BABELLA, Defendant and Respondent.
    No. 88-524.
    Submitted on Briefs Jan. 26, 1989.
    Decided May 9, 1989.
    772 P.2d 875.
    Marc Racicot, Atty. Gen., Robert F.W. Smith, Asst. Atty. Gen., Helena, Robert L. Deschamps, Co. Atty., Craig Friedenauer, Deputy Co. Atty., Missoula, for plaintiff and appellant.

      J. Dirk Beccari, Public Defender, Missoula, for defendant and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

The District Court for the Fourth Judicial District, Missoula County, dismissed the charges against this defendant. The State appeals. We reverse.

The issue is:

Did the District Court err in granting defendant’s motion which requested disclosure of the identity of confidential informants?

On October 3, 1987, Missoula law enforcement obtained a search warrant to search the home of Terry LaRoque. The application for the warrant was lengthy and contained information from several sources including Crimestoppers reports, anonymous phone calls, a participant in the drug sales, and information from confidential informants. The application recited specific instances in which reports given by informants and callers had been verified by law enforcement. Information obtained from the informants and other sources linked the sale of drugs to Terry LaRoque.

When the officers executed the search warrant at the home of Terry LaRoque, Ms. Babella was found in bed with him. Drugs, various items of drug paraphernalia, and a large amount of cash, were found in the bedroom and in pants belonging to Ms. Babella. She was subsequently arrested.

On October 19, 1987, the State filed an information charging Ms. Babella with the offense of possession of dangerous drugs with the intent to sell, in violation of § 45-9-103(1), MCA. Ms. Babella plead not guilty on November 13, 1987. Later, the defendant moved for the disclosure of the State’s confidential informants, and a hearing on this motion was held on June 17, 1988. At that hearing the State presented one witness, police officer Bill Wicks. He testified to facts which indicated that disclosure of identity would produce a substantial risk of harm to the informants. The defendant produced no testimony. The court ordered both parties to brief the issue, and subsequently ordered the State to disclose the identity of the informants. When the State refused, the court ordered the charges against the defendant dismissed.

A governmental entity may claim the privilege to refuse to disclose the identity of its confidential informants. This privilege is not absolute but is subject to a balancing test enunciated in Roviaro v. United States (1957), 353 U.S. 53, 77 S.Ct. 623, 1 L.Ed.2d 639. In Roviaro the Court stated:

“We believe that no fixed rule with respect to disclosure is justifiable. The problem is one that calls for balancing the public interest in protecting the flow of information against the individual’s right to prepare his defense. Whether a proper balance renders nondisclosure erroneous must depend on the particular circumstances of each case, taking into consideration the crime charged, the possible defenses, the possible significance of the informer’s testimony, and other relevant factors.” 353 U.S. at 62, 77 S.Ct. at 628.

Montana previously recognized this test in State ex rel. Offerdahl v. Dist. Ct. of Eighth Judicial Dist. (1971), 156 Mont. 432, 481 P.2d 338.

This privilege was codified in Montana in 1977 by the enactment of Rule 502 M.R.Evid., which states:

“(a) Rule of privilege. The United States or a state or subdivision thereof has a privilege to refuse to disclose the identity of a person who has furnished information relating to or assisting in an investigation of a possible violation of a law.
“(b) Who may claim the privilege. The privilege may be claimed by an appropriate representative of the public entity to which the information was furnished.
“(c) Exceptions and limitations.
“(1) Voluntary disclosure; informer a witness. No privilege exists under this rule if the identity of the informer or his interest in the subject matter of his communication has been disclosed to those who would have cause to resent the communication by a holder of the privilege or by the informer’s own action, or if the informer appears as a witness for the public entity.
“(2) Testimony on relevant issue. If it appears in the case that an informer may be able to give testimony relevant to any issue in a criminal case or to a fair determination of a material issue on the merits in a civil case to which a public entity is a party, and the public entity invokes the privilege, the court shall give the public entity an opportunity to show facts relevant to determining whether the informer can, in fact, supply that testimony.
“If the Court finds that the informer should be required to give the testimony, and the public entity elects not to disclose his identity, the Court on motion of the defendant in a criminal case shall dismiss the charges to which the testimony would relate, and the court may do so on its own motion. In civil cases, the court may make any order that justice requires.”

. The Commission Comments regarding this rule state, “The Commission believes this balances the interest of the public entity against a party’s right to prepare his defense and to confront and examine his accuser.”

In 1985, the Montana Legislature enacted § 46-15-324(3), MCA, which also addresses this privilege. That statute provides”

“Disclosure of the existence of an informant or of the identity of an informant who will not be called to testify is not required if:

“(a) disclosure would result in substantial risk to the informant or to his operational effectiveness; and

“(b) the failure to disclose will not infringe the constitutional rights of the accused.”

These rules reflect the policy of balancing the public’s interest in protecting the flow of information to law enforcement, against the defendant’s rights.

In the present case, the record is bare regarding the defendant’s basis for making the motion for disclosure of the informants. Likewise, the order by the District Court gives no reason supporting its decision to order disclosure. In considering this issue on appeal, we have only the transcript from the hearing for our guidance. At the hearing, the defendant made no showing whatsoever which would establish a need for information about the confidential informants. We are therefore unable to determine why the court ordered disclosure.

In the present case the State contends that it met its burden by showing that disclosure would subject the informants to a substantial risk of harm. At the hearing on the motion to disclose the identity of the informants, Officer Wicks stated that Ms. Babella’s boyfriend, Terry LaRoque, was connected with individuals in other states who were “in the habit of using violence for enforcement.” The excerpt from the transcript states:

“Q. Do you have any feeling as to whether or not disclosure of these informants could result in a risk of harm to them?
“A. Yes, sir, I do.
“Q. What is the basis for your feeling?
“A. Our investigation has revealed that individuals connected with LaRoque in other states are in the habit of using violence for enforcement.
“In particular, one incident in Pasco, Washington, resulted in the death of four people by machine gun. These people have been directly tied into Mr. LaRoque by investigation.”

Officer Wickes also testified to finding nine guns in the residence of Mr. LaRoque and Ms. Babella.

On cross-examination, defense counsel asked if Ms. Babella herself had made threats against the informants. The officer said, “Yes,” and stated that after a discussion between Ms. Babella and law enforcement, Ms. Babella had reported the police activity to “some Mexicans in town” who told her in so many words that “they would handle the problem. “

The testimony by Officer Wicks established that disclosure would result in substantial risk to the informants, and is clearly sufficient to invoke the privilege pursuant to § 46-15-324(3)(a), MCA.

Ms. Babella contends that in her case two exceptions may apply to this rule of privilege. She urges that nondisclosure may violate her constitutional rights pursuant to § 46-15-324(3) (b), MCA, or that the informant may be able to give “testimony relevant to any issue” pursuant to Rule 502(c)(2), M.R.Evid. However, Ms. Babella made absolutely no showing which would invoke either exception. After Officer Wicks testified that Ms. Babella had reported the police activity to “some Mexicans in town,” defense counsel moved for “immediate disclosure of that information,” stating, “It is obviously pertinent to Ms. Babella’s case.” This statement made by defense counsel constitutes the defendant’s only attempt to show a need for disclosure. The information referred to did not even relate to her alleged offense. “Mere conjecture or supposition about the possible relevancy of the informant’s testimony is insufficient to warrant disclosure.” State v. McLeod (1987), [227 Mont. 482,] 740 P.2d 672, 675, 44 St.Rep. 1251, 1255 (citing United States v. Kerris (11th Cir. 1984), 748 F.2d 610, 614). As we stated in State v. Sykes (1983), [-Mont._,] 663 P.2d 691, 695, 40 St.Rep. 690, 693, “allowing such a routine challenge as that presented by defendant would hamstring the effective operation of law enforcement agencies.” Whereas the State met its burden, there was a total failure on the part of the defendant to demonstrate any need which would compel disclosure. The general assertion of a need for disclosure was wholly inadequate to satisfy the defendant’s burden under the Rouiaro test, or under either relevant statute.

Ms. Babella contends that the State must first disclose the relevance of the informants’ testimony. She argues that only then can she know if her constitutional rights have been violated, and only then can the balancing test be made. This misconstrues the balancing test, and the requirements under the statutes. In this balancing test the burden is on the defendant to show the need for disclosure, and this need must be one which overrides the government’s interest. Mere speculation will not suffice. United States v. Prueitt (9th Cir. 1976), 540 F.2d 995, 1003-04.

The District Court’s order is vacated and this case is remanded for further proceedings.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, GULBRANDSON and McDONOUGH concur.

MR. JUSTICE SHEEHY,

dissenting:

I dissent on two grounds, (1) the majority analysis of § 46-15-324(3), MCA, is incomplete, and (2) the testimony of the police officer regarding danger to the informants is vague and imprecise, as it relates to the defendant Annette Babella.

First the statute. It has two subsections (a) and (b) as set out in the majority opinion. The subsections are connected with the conjunction “and.” To gain the nondisclosure of information, because of the conjunction, the State must show (1) substantial risk, and (2) the constitutional rights of the accused are not infringed. The majority opinion discusses the first prong but fails utterly to examine the infringement of Babella’s constitutional rights, including the right to meet her accusers face-to-face, and the right to prepare a defense.

Second, the purported risk to the informers. The testimony of Officer Wicks speaks vaguely and arcanely of a “habit” based on one incident unconnected to Babella. He testified that she spoke of police activity to “some Mexicans in town” who told her “they would handle the problem.” Nothing in those statements reflects any danger to hidden witnesses or informers, unless we assume that “Mexicans” as a class are dangerous, and that in “handling” the problem, the Mexicans meant violence. At most, the supposed danger is speculation, if the testimony is all the State has.

I would affirm the District Court.

MR. JUSTICE HUNT concurs in the dissent.