text:
    WARREN A. McMILLAN, Plaintiff and Appellant, v. LANDOE, BROWN, PLANALP, KOMMERS AND JOHNSTONE, P.C., and Gene I. Brown, Defendants and Respondents.
    No. 88-171.
    Submitted on Briefs July 14, 1988.
    Decided Sept. 1, 1988.
    760 P.2d 758.
    Bruce E. Lee, Billings, for plaintiff and appellant.
    Worden, Thane & Haines, Sam M. Warren, Missoula, for defendants and respondents.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

The plaintiff, Warren A. McMillan, appeals the order of the Eighteenth Judicial District Court, Gallatin County, Montana, dismissing his action for legal malpractice against the defendants. The case was submitted to the District Court on a stipulation of facts and judgment was rendered in favor of defendant’s motion for summary judgment. We affirm the judgment of the District Court.

The stipulated facts reveal the following:

On October 14, 1976, the plaintiff entered into a contract for deed for the purchase of real property from Hilda Peterson. The total purchase price was $130,000. Hilda Peterson borrowed $26,000 from George Stublar on October 21, 1977, to cure a delinquent debt. Stublar took a mortgage on the property denominated in plaintiffs contract for deed as security. When he had not received repayment from Hilda Peterson by June 18, 1981, Stublar filed suit charging her with nonpayment of the loan. The attorney for Stublar in that action was Gene Brown, a partner in the law firm of Landoe, Brown, Planalp, Kommers & Johnstone, P.C. Both Brown and the law firm are named defendants in this present action.

Brown obtained a judgment for Stublar on November 23, 1981 and immediately obtained a writ of execution from the Gallatin County Clerk of Court against Hilda Peterson in the amount of $38,993.86, including interest and costs. A sheriffs sale was held on December 1, 1981, at which Hilda Peterson’s interest in the Peterson/McMillan contract for deed was sold. McMillan, who still owed Hilda Peterson $98,802 on the contract, purchased it at the sheriffs sale for $39,000.

In February, 1982, Hilda Peterson filed a declaratory judgment action against McMillan and the Montana Bank of Bozeman, N.A., the personal representative of Stublar’s estate. The District Court dismissed as res judicata Hilda Peterson’s attempt to set aside the earlier judgment and sheriffs sale. On her appeal to this Court, we noted a lack of an entry of default judgment on the Stublar claim, a lack of actual notice to Hilda Peterson of the sheriffs sale, and a discount of almost $60,000 on the contract. We reversed the summary judgment against Hilda Peterson and instructed the District Court to annul and vacate the sheriffs sale. Peterson v. Montana Bank of Bozeman, N.A. (Mont. 1984), [212 Mont. 37,] 687 P.2d 673, 681, 41 St.Rep. 1575, 1584.

McMillan asserts in the present case that attorney Brown and the law firm “failed, through acts of commission and omission, to exercise due care in prosecuting the sheriffs sale and did not prosecute [the judgment] ... in a proper and skillful manner.” McMillan further asserts that he had a right to rely on attorney Brown’s legal work, and that reliance cost him the benefit of the bargain struck at the sheriffs sale, interest on money borrowed to make the sheriffs sale purchase, and legal fees. The District Court granted summary judgment to attorney Brown and his law firm reasoning that Brown owed no professional duty of skill and care to one not a client and not intended as a primary beneficiary. The court also ruled that the action was barred by the three-year statute of limitations in Section 27-2-206, MCA.

Although two issues are presented for our consideration, we find the statute of limitations issue controlling. Therefore, no discussion of the other issue is necessary. The issue before us is:

Did the District Court properly rule that the three-year limitation would not be tolled any later than March 8, 1982, when counsel for McMillan appeared to defend against Hilda Peterson’s complaint?

Section 27-2-206, MCA, sets a limitation for actions sounding in professional negligence against attorneys:

“An action against an attorney licensed to practice law in Montana or a paralegal assistant or a legal intern employed by an attorney based upon the person’s alleged professional negligent act or for error or omission in the person’s practice must be commenced within 3 years after the plaintiff discovers or through the use of reasonable diligence should have discovered the act, error, or omission, whichever occurs last, but in no case may the action be commenced after 10 years from the date of the act, error, or omission.” (Emphasis added.)

In the present case, the District Court ruled that McMillan’s complaint, filed November 7, 1986, was barred by the statute because McMillan’s attorney appeared in court to defend against Hilda Peterson’s request for declaratory relief on March 8, 1982, some four years and eight months earlier. McMillan appeals, claiming the statute was tolled until this Court decided Peterson, supra, on August 16, 1984, two years and three months before he filed his complaint.

McMillan argues that he suffered no injury until this Court decided Peterson, supra. Therefore, he asserts the statute cannot begin to run before August 16, 1984. However, Montana law is very clear and to the contrary. The statute begins to run on the date the plaintiff learned the facts, or through reasonable inquiry should have learned the facts, of the attorney’s alleged negligent acts. Schweitzer v. Estate of Halko (Mont. 1988), [231 Mont. 283,] 751 P.2d 1064, 1066-67, 45 St.Rep. 611, 614; Schneider v. Leaphart (Mont. 1987), [228 Mont. 483,] 743 P.2d 613, 616, 44 St.Rep. 1699, 1702; Burgett v. Flaherty (1983), 204 Mont. 169, 173, 663 P.2d 332, 334. There is no provision that the statute of limitations begins to run only after discovery of plaintiff’s damages. Schneider, 743 P.2d at 616.

The facts complained óf now, and which are alleged to be professional negligence, were known to McMillan and the attorney who represented him against Hilda Peterson’s action on March 8, 1982. Those facts form the basis for his professional negligence complaint against attorney Brown. As such, McMillan had until March 8, 1985 to file his cause of action against attorney Brown and the law firm of Landoe, Brown, Planalp, Kommers & Johnstone, P.C. He failed to do this and his action is properly barred.

Affirmed.

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


source: Caselaw Access Project

author: MR. JUSTICE WEBER MR. JUSTICE HUNT,

license: Public Domain

text:
    SHARON TURBIVILLE, Plaintiff and Appellant, v. ERLING HANSEN and Avis Hansen, husband and wife; and Avis Corporation, a Montana corporation; and Alfred Graf; and First National Bank & Trust Co., a North Dakota Banking Institution, Defendants and Respondents.
    No. 88-88.
    Submitted on Briefs July 8, 1988.
    Decided Sept. 6, 1988.
    761 P.2d 389.

      Timothy J. Whalen, Whalen & Whalen, Billings, for plaintiff and appellant.
    Phillip N. Carter, Koch & Carter, Sidney, Donna M. Murphy; Rolfstad, Winkjer, McKennett and Stenehjem, Williston, N.D., for defendants and respondents.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

This is an action for damages arising from the termination of Ms. Turbiville’s contractual interest in a nightclub and restaurant on the Montana-North Dakota state line. The District Court for the Fifteenth Judicial District, Roosevelt County, granted summary judgment to defendant First National Bank and Trust Co. (Bank). Ms. Turbiville appeals. We affirm.

The issue is whether the lower court erred in granting the Bank summary judgment.

In June of 1982, Ms. Turbiville entered into an agreement to purchase the State Line Club (Club) from defendants Hansen. Ms. Turbiville paid $95,000 as a down payment and signed a contract for deed for the balance. The Bank was the escrow agent.

In 1983, Ms. Turbiville entered negotiations to sell the Club to defendant Mr. Graf, a Canadian citizen. Under their agreement, Mr. Graf took possession of the Club in June but the final closing of the sale would not take place until July 31. The closing did not take place on that date, but instead was postponed several times.

On August 10, 1983, the Hansens, through their attorney, issued a notice of default alleging violation of paragraph XII of the contract for deed, in which Ms. Turbiville had agreed to maintain the Club’s bar and liquor licenses in good standing:

“Until final payment hereunder, Purchaser agrees to keep and maintain said liquor and beer licenses to be acquired hereunder in full force and effect and to commit no act or failure to act which might result in the loss of said licenses. Purchaser also agrees until final payment hereunder to keep the cocktail lounge on said premises operating during the legal operating hours of licensed liquor establishments, and to comply with all of the laws of the State of Montana, pertaining to the operation of retail liquor establishments. Any failure to fulfill the covenants of this paragraph shall be considered a default under the terms of article III of this contract.”

The problem, of which Ms. Turbiville was aware, was a question on the part of the Montana Department of Revenue about continuation of the Club’s state liquor license, because Mr. Graf is a Canadian citizen. The notice of default stated, in relevant part:

“[Y]ou have committed acts and have failed to act in such a manner that the liquor and beer license might be lost and/or terminated by the Montana Department of Revenue, Liquor Division. You have further failed to comply with all of the laws of the State of Montana pertaining to the operation of a retail liquor establishment. The specific acts or omissions and other violations have been reported to Erling and Avis Hansen through the undersigned by Mr. Mike Otterberg, who is an investigator for the Legal Enforcement Division of the Montana Department of Revenue.”

On October 12, 1983, the Hansens and their attorney went to the Bank and requested that the escrow be closed and all documents be returned to them. They presented the escrow officer with a copy of the default notice which had been sent to Ms. Turbiville. They also presented the escrow officer with an “Affidavit to Close Escrow” stating:

“We, Erling Hansen and Avis Hansen, after being duly sworn upon oath, state:

“1. That we are the parties who entered into that certain Contract for Deed and Conditional Sales Contract with Sharon Turbiville dated the 1st day of June, 1982.

“2. That on the 10th day of August, 1983, a Notice of Default was sent to Sharon Turbiville at Bainville, Montana.

“3. That a true and correct copy of said Notice of Default is attached hereto.

“4. That the sixty (60) day grace period has expired without said default having been cured and that we have elected to cancel this contract.

(Dated and signed.)”

The escrow officer copied the documents in the escrow file and gave the originals to the Hansens.

Ms. Turbiville brought this action alleging that when the contract for deed was canceled she lost all the money she had paid on the Hansen contract, along with other damages. Her claim against the Bank alleged that the Bank breached a fiduciary duty owed to her when it delivered the documents in the escrow account to the Han-sens without contacting her. The complaint alleged that “ [a] reasonable and prudent businessman would have some doubt that a breach existed according to the terms of the notice of default when Alfred Graf and his attorney were present when the escrow account was turned over.” (The allegation that Mr. Graf and his attorney were present is not supported by the depositions.)

The Bank moved for, and was granted, summary judgment prior to trial. Ms. Turbiville settled with the other defendants. Then she asked the court to reconsider the order granting summary judgment to the Bank. The court reaffirmed its order and Ms. Turbiville appeals.

Did the lower court err in granting the Bank summary judgment?

Rule 56, M.R.Civ.P., allows a district court to enter summary judgment when the pleadings, depositions, and other documents on file with the court demonstrate no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. This Court’s review of a summary judgment is based on its examination of the entire case. Shimsky v. Valley Credit Union (Mont. 1984), 208 Mont. 186, 676 P.2d 1308, 1310, 41 St.Rep. 258, 260.

Ms. Turbiville’s argument on appeal is that there were disputed issues of material fact and that the Bank was not entitled to judgment as a matter of law. She argues that summary judgment for the Bank was not proper because 1) the contract required an actual default, not just a claimed one, before the escrow documents could be returned to the Hansens, 2) both the liquor license provision in the contract for deed and the default notice sent to her are void for vagueness, 3) it would have been impossible for her to cure the default within the time allowed because the Department of Revenue had not set hearing on the alleged liquor license violation until November 14, 1983, and 4) the affidavit requesting closure of the escrow was insufficient on its face because it did not clarify whether notice was provided to her in accordance with the terms of the contract.

The escrow agreement signed by the Bank, Ms. Turbiville, and the Hansens provided, in relevant part:

“4. If the purchaser, or her personal representatives, heirs or assigns, shall default in making payment as agreed, or shall otherwise default in the performance of the provisions of the contract for deed, then the seller, their personal representatives, heirs or assigns upon demand shall be entitled to the immediate return from the escrow agent of the contract for deed, warranty deeds and abstracts, so that they may pursue such remedies as provided by law for the foreclosure of the contract for deed.

“9. The escrow agent shall be liable only to account for the money received by it and for the delivery of the instruments and documents escrowed in accordance with the terms of this agreement.”

In this case we conclude that the only obligation of the escrow holder was to adhere strictly to the instructions as provided in the escrow agreement. See First Fidelity Bank v. Matthews (Mont. 1984), [214 Mont. 323,] 692 P.2d 1255, 1259, 41 St.Rep. 2502, 2506. The Bank's duty, under paragraph 4 of the escrow agreement, was to “upon demand” immediately return the escrow documents to the sellers in the event of default. The agreement does not require the escrow agent to ascertain whether the demand for return of the escrow documents is technically justified. Neither does it require the escrow agent to determine whether the notice given to Ms. Turbiville was legally sufficient, whether the Department of Revenue’s hearing date renders performance of the contract impossible, or whether the contract and default notice are void for vagueness. Ms. Turbiville improperly characterizes these issues as factual determinations which the Bank was responsible for making before returning the escrow documents to the seller. These determinations are appropriate for a court of law, not for the escrow agent. The remedy for omission of any of these requirements was suit against the Hansens, and all of these issues may have been relevant to the settled part of this lawsuit. These issues do not create an issue of material fact as to the claim against the Bank, because they are unrelated to whether the Bank adhered strictly to the instructions as provided in the escrow agreement.

As a final matter, we must admonish counsel for the Bank. The attachment to its brief of a document executed subsequent in time to the matters involved in this appeal was entirely inappropriate.

We affirm the summary judgment in favor of the Bank.

MR. JUSTICES HARRISON, McDONOUGH and GULBRANDSON concur.

MR. JUSTICE HUNT,

dissenting:

I dissent from the majority’s conclusion that summary judgment should be granted in this case. Summary judgment is only appropriate when, viewed in the light most favorable to the nonmoving party, there are no material questions of fact in issue. Cereck v. Albertson's, Inc. (1981), 195 Mont. 409, 411, 637 P.2d 509, 510-511. In the present case, the clause in the escrow agreement that directed the First National Bank & Trust Company to return the documents it held in escrow could only be triggered by the existence of an actual default. The evidence before the Court, however, does not clearly indicate whether a default did in fact occur. Thus, a material question of fact is in dispute, and summary judgment is improper.

I also disagree with the majority’s assertion that the bank had no duty to ascertain whether the demand for delivery of the documents was justified. Granted, the escrow agreement specified that the bank was to deliver the documents “upon demand” by the seller. However, the evidence shows that First National had previously gone beyond the directions of the escrow agreement for the benefit of the sellers. In all fairness, and in keeping with the purpose of escrow agreements in general, the bank should not now be allowed to claim that the limits of the contract prevented it from making any inquiry to determine whether default in fact existed or notice had been received before handing over instruments it held in trust for Turbiville.

Individuals with differing interests enter into an escrow arrangement to ensure that their rights are safeguarded by a disinterested third party, the escrow agent. Blackburn v. McCoy (1934), 1 Cal.App.2d 648, 654, 37 P.2d 153, 155. The escrow agent becomes an agent for each of the principles to the escrow agreement. First Fidelity Bank v. Matthews (1984), [214 Mont. 323,] 692 P.2d 1255, 1258, 41 St.Rep. 2502, 2505. As such, the escrow agent owes fiduciary duties to each of its principles. Dulan v. Montana National Bank (1983), 203 Mont. 177, 182, 661 P.2d 28, 30. These duties require the agent to walk a fine line between the conflicting interests of the parties to a contract for deed placed in its possession. For this reason, it is of the utmost importance that the escrow agent remain impartial to both sides by strictly following the instructions of the escrow contract.

First National Bank & Trust breached its duty of impartiality when it failed to strictly follow the directions of the escrow agreement. The agreement instructed the bank to receive payments from Turbiville and to distribute those payments in a certain fashion. The contract made no mention of the need to take any action to collect payments. Even so, First National took it upon itself to call Turbiville whenever a payment was late. In so doing, the bank exceeded its role as defined by the escrow agreement and became, in effect, a collection agent for the Hansens, rather than a mere depository.

Since the bank went beyond the confines of the escrow agreement on behalf of the sellers, it should not be able to shield itself behind the wording of the contract to justify its failure to verify the existence of a default before surrendering the documents in its possession. The affidavit presented to the bank stated only that notice of default had been mailed to Turbiville; there was no indication that notice had been sent by certified mail as required by the contract for deed. Furthermore, the notice itself only vaguely referred to the particulars of the default. The least the bank should have done under the circumstances was call Turbiville to see that she had received the notice and to clarify the terms of the default.

Sharon Turbiville paid approximately $165,000 toward the purchase of the State Line Club. The bank, as escrow agent, held the deed to the club in trust for her. It breached its trusteeship by failing to maintain an impartial stance between Turbiville, as the buyer, and the Hansens, as the sellers of the State Line Club.

For these reasons, I would reverse the District Court’s order for summary judgment.


author: MR. JUSTICE McDONOUGH

text:
    RITA GOULD, Claimant and Respondent, v. COUNTY MARKET/SUPER VALU STORES, Employer, and Liberty Mutual Fire Insurance Company, Defendant and Appellant.
    No. 88-186.
    Submitted on Briefs July 21, 1988.
    Decided Sept. 8, 1988.
    766 P.2d 213.

      Garlington, Lohn & Robinson, Larry Jones, Missoula, for defendant and appellant.
    Linnell, Newhall & Martin, Richard J. Martin, Great Falls, for claimant and respondent.
   MR. JUSTICE McDONOUGH

delivered the Opinion of the Court.

Liberty Mutual Fire Insurance Company (Liberty) appeals from the order of the Workers’ Compensation Court of the State of Montana granting plaintiff Rita Gould’s motion for a new trial. We affirm.

Liberty frames four issues for review by this Court:

1. Whether the grounds on which the Claimant based her motion for a new trial were insufficient as a matter of law to allow the Workers’ Compensation Court to grant a new trial.

2. Whether the Workers’ Compensation Court Judge may grant a new trial by reversing his Hearing Examiner’s findings of fact.

3. If the Worker’s Compensation Court Judge may grant a new trial by reversing his Hearing Examiner’s findings of fact, then may he do so by substituting his judgment for that of his Hearing Examiner’s of the credibility (i.e. competency) of a witness whose demeanor and character his Hearing Examiner has observed and judged but who he, the Workers’ Compensation Court Judge, has never observed.

4. Whether the Claimant complied with the 60-day notice requirement of Section 39-71-603, MCA (1985).

On September 8, 1986, Rita Gould filed a Petition For Hearing in the Montana Workers’ Compensation Court. She alleged her preexisting conditions of cervical and lumbar spondylosis had been aggravated in the course of her employment, leading to an incident on May 26, 1985, when she experienced dizziness and severe neck, shoulder and back pain while at work. According to Gould’s petition, the incident was a “culmination of symptoms” related to her employment. The symptoms persisted, rendering Gould temporarily totally disabled.

The Workers’ Compensation Court appointed a Hearing Examiner for Gould’s claim. The examiner held a hearing at which testimony was taken and evidence introduced. He subsequently issued his Findings of Fact and Conclusions of Law and Proposed Judgment. He denied Gould’s claim on the ground that she had failed to notify her employer of her injury within 60 days as required by Section 39-71-603, MCA (1985). The Hearing Examiner’s proposed judgment was adopted by the court in an order issued the same day as the proposed judgment. The court’s order also stated that any party to the dispute would have 20 days to request a rehearing.

Gould timely filed her Motion For New Trial, in which she alleged that the Hearing Examiner did not consider two items of evidence she considered crucial. Gould pointed to a handwritten memo by the store manager in which he noted suggesting to Gould that she begin her retirement if working conditions at the store were detrimental to her health. She also cited an insurance claim form signed by Gould and the store manager on which Gould had answered “yes” to the question, “Is illness or injury due to Claimant’s occupation?” Both documents were dated within 60 days of the date of Gould’s injury, and she contended that they provided actual notice to her employer of her injury and its relation to her employment. The court granted Gould’s motion in its order of March 16, 1988:

“These two written notices are sufficient to establish that actual notice was given to the employer within 60 days, as required by Section 39-71-603, MCA.

“The Court concludes that it erred in not recognizing the two written statements in evidence cited by claimant which do establish notice and that manifest injustice would be done if claimant were not granted a rehearing.”

This appeal followed.

Our review of the record and relevant authorities indicates that the four issues framed by Liberty can be restated as one. What is really at issue in this appeal is whether the Workers’ Compensation Court Judge can order a new trial on the ground that the Hearing Examiner apparently disregarded or was not aware of pieces of evidence that were crucial to the case. We hold that the judge has that power.

Both parties acknowledge the court’s ability to grant a new trial under Rules 2.52.340 and 2.52.344 of the Administrative Rules of Montana. The parties disagree, however, on the propriety of the court’s grounds for granting a new trial in this case.

Liberty sets out two inconsistent arguments that sufficient grounds for a new trial do not exist. The first argument states the decision was improper under sections of the civil procedure code. The second argument is based on rules of administrative procedure. The inconsistency of these positions is symptomatic of the unique position occupied by the Workers’ Compensation Court. On one hand, the Workers’ Compensation Court is not a full-fledged District Court. Its jurisdiction is limited to workers’ compensation matters, and its procedures are less formal. For example, Section 39-71-2903, MCA (1985), states that the Montana Administrative Procedure Act (MAPA) applies to the court’s proceedings, while the rules of evidence do not. On the other hand, the court’s decisions are something more than administrative agency decisions. Agency decisions are normally appealable to District Court, but Section 39-71-2904, MCA (1985), provides that decisions of the Workers’ Compensation Court are appealed directly to this Court. Liberty’s reliance on both civil and administrative procedure is thus warranted. Both arguments are supported by authority from this Court. However, the focus of Liberty’s argument is misplaced.

We note that both of Liberty’s arguments are premised on the limited power of the Workers’ Compensation Court to review oral testimony. Liberty seeks to take advantage of this limited power of review by casting Gould’s motion as a disagreement with the weight given her own testimony before the Hearing Examiner. This is a mischaracterization of Gould’s argument, which is based on two written documents in evidence before the examiner. In addition to granting the power to order a new trial, 2.50.340, ARM, requires that the court conduct its review on the basis of the complete record, with its decision based on the evidence as a whole. Liberty’s premise is thus faulty, and its arguments proceed on a tangent concerning the credibility and demeanor of witnesses that bears little relation to the issue at hand.

Liberty’s first argument suffers as a result of this faulty premise. Relying on our decision in Walter v. Evans Products Co. (1983), 207 Mont. 26, 672 P.2d 613, Liberty asserts that the authority of the Workers’ Compensation Court to grant a new trial is governed by the general civil procedure standards in Sections 25-11-102 and 103, MCA (1985):

“The former verdict or other decision may be vacated and a new trial granted on the application of the party aggrieved for any of the following causes materially affecting the substantial rights of such party:

“(1) irregularity in the proceedings of the court, jury, or adverse party or any order of the court or abuse of discretion by which either party was prevented from having a fair trial;

“(3) accident or surprise which ordinary prudence could not have guarded against;

“(4) newly discovered evidence material for the party making the application which he could not, with reasonable diligence, have discovered and produced at trial;

“Section 25-11-102, MCA (1985).

“No new trial may be granted in cases tried by the court without a jury, except on the grounds mentioned in subsections (1), (3), and (4) of 25-11-102.

“Section 25-11-103, MCA (1985).”

According to Liberty, none of these grounds were argued by Gould in her motion, nor are any presented by the record of this case. Rather, Liberty asserts that Gould merely disagreed with the court as to the weight and relevance of her own testimony.

Liberty relies on Walter for the proposition that disagreement with the weight given to testimony is an insufficient ground for a new trial as a matter of law. However, the Walter decision did not turn on the review of oral testimony. The party seeking a new trial in that case argued (1) the court should have reopened the case to consider newly discovered evidence, and (2) there was a complete lack of probative, credible evidence in the record to support a number of the court’s findings. Walter, 672 P.2d at 616.

When we reviewed the Walter decision, we looked to Sections 25-11-102 and 103, MCA (1985), as the most directly applicable guide on the question of newly-discovered evidence. The issue turned on the fact that the moving party had custody of the evidence in question. In contrast with Walter, the question in this case is whether the examiner’s proposed decision was actually contrary to evidence in the record. The question of newly-discovered evidence is not presented, and the civil procedure statutes cited by Liberty are not applicable.

Liberty’s second argument looks to the provisions of MAPA. Liberty points out that the Division of Workers’ Compensation is an administrative agency, and that under our decision in Hock v. Lienco Cedar Products (Mont. 1981), [_Mont._,] 634 P.2d 1174, 38 St.Rep. 1598, the rules of civil procedure are not directly applicable to the Workers’ Compensation Court. Liberty asserts that under MAPA — specifically Section 2-4-621, MCA (1985) — the Workers’ Compensation Court Judge “sits in a form of appellate review of his hearing examiner’s proposed decision,” and is limited in his review of the hearing examiner’s findings of fact. In relevant part, the statute states:

“The agency in its final order may reject or modify the conclusions of law and interpretation of administrative rules in the proposal for decision but may not reject or modify the findings of fact unless the agency first determines from a review of the complete record and states with particularity in the order that the findings of fact were not based upon competent substantial evidence or that the proceedings on which the findings were based did not comply with essential requirements of law.”

Section 2-4-621(3), MCA (1985). Liberty also notes that 2.52.340, ARM, contains a similar standard:

“Findings of fact made by a hearing examiner will not be rejected or revised unless the Court first determines from a review of the complete record and states with particularity in the order that the findings of fact were not based upon competent substantial evidence. . .”

2.52.340(3)(a), ARM. Liberty argues that under these standards, it should have been impossible for the court to grant Gould’s motion. According to Liberty, the decision in this case required the court to substitute its judgment for that of the examiner as to the weight given to testimony of witnesses at the hearing.

As with its first argument, Liberty’s application of MAPA suffers from the mistaken premise that only Gould’s oral testimony was before the Workers’ Compensation Court. Liberty is correct in its assertion that the judge in this case sat in a form of review of the examiner’s proposed decision. However, Liberty’s focus on the standard of review exercised by agencies under Section 2-4-621, MCA (1985) is inappropriate. As we stated above, the procedure in the Worker’s Compensation Court is not the same as that followed by an agency. We have previously noted this fact when distinguishing case authority dating from before the court’s creation.

“[The party’s] principal case was handed down before the Worker’s Compensation Court was established. At the time of that case, the division conducted its own contested case hearings like all other agencies."

Hock, 634 P.2d at 1178 (Emphasis added.). While the Workers’ Compensation Court is not a full-fledged District Court, Sections 39-71-2901 through 39-71-2909, MCA (1985), grant the court authority broader than that exercised by an agency:

“Although the Workers’ Compensation Court is not vested with the full powers of a District Court, it nevertheless has been given broad powers concerning benefits due and payable to claimants under the Act. It has the power to determine which of several parties is liable to pay the Workers’ Compensation benefits, or if subrogation is allowable, what apportionment of liability may be made between insurers, and other matters that go beyond the minimum determination of the benefits payable to an employee.”

State ex rel. Uninsured Employers' Fund v. Hunt (Mont. 1981), [191 Mont. 515,] 625 P.2d 539, 542, 38 St.Rep. 421, 425 (Emphasis added.). One “other matter” specifically provided for in 2.52.340, ARM, is the power to grant a new trial.

In view of the broader powers exercised by the court, we hold the standards for judicial review of a master’s report found at Rule 53(e), M.R.Civ.P., are more applicable to the facts of this case than the standard urged by Liberty:

“Report. (1) Contents and filing. The master shall prepare a report upon the matters submitted to him by the order of reference and, if required to make findings of fact and conclusions of law, he shall set them forth in the report . . .

“(2) In nonjury actions. In an action to be tried without a jury the court shall accept the master’s findings of fact unless clearly erroneous . . . The court after hearing may adopt the report or may modify it or may reject it in whole or in part or may receive further evidence or may recommit it with instructions.”

The Workers’ Compensation Court Judge appointed the Heading Examiner to hear the evidence in this case, but it was for the court to make the final decision. The examiner’s findings, conclusions and proposed decision were submitted to the court for its approval.

When reviewed in light of Rule 53(e), the record supports the court’s decision to grant a new trial. The memo and insurance form indicate that Gould’s employer knew of her injury and knew — or should have known — that the injury was related to her employment. This constitutes notice. The Hearing Examiner’s denial of Gould’s claim was based on the lack of such notice. As Gould’s properly-filed motion served to point out, the examiner’s findings of fact were therefore clearly erroneous. The court was correct in holding that proper notice had been given, and a new trial should be granted.

We affirm the decision of the Workers’ Compensation Court that Gould gave proper notice of her injury, and remand the case for a new trial on the merits of her claim.

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


author: MR. JUSTICE GULBRANDSON MR. JUSTICE SHEEHY,

text:
    STATE OF MONTANA, Plaintiff and Appellant, v. TIMOTHY JOHN CAMPBELL, Defendant and Respondent.
    No. 88-89.
    Submitted on Briefs June 22, 1988.
    Decided Sept. 12, 1988.
    761 P.2d 393.

      Mike Greely, Atty. Gen., Barb Claassen, Asst. Atty. Gen., Helena, A. Michael Salvagni, Co. Atty., Marty Lambert, Deputy Co. Atty., Bozeman, for plaintiff and appellant.
    Larry Jent, Bozeman, for defendant and respondent.
   MR. JUSTICE GULBRANDSON

delivered the Opinion of the Court.

The State of Montana (State), appeals an order of the Eighteenth Judicial District Court, Gallatin County, dismissing a fugitive warrant issued on Timothy Campbell (Campbell), defendant/respondent, and the court’s quashing of a writ of extradition. We reverse.

The issue presented by the State is whether the District Court improperly dismissed the extradition proceedings?

A stipulation of facts is attached to the State’s brief. According to this stipulation, Campbell was charged in the Eighteenth Judicial District Court on a “Complaint for Fugitive Warrant” on September 11, 1987. The complaint stated Campbell was charged in the state of Wisconsin with feloniously and intentionally failing to return rented personal property. Campbell made an initial appearance on September 14, 1987, posted bail and was released. Campbell was advised of his rights to petition the court for a writ of habeas corpus and to refuse to waive extradition to Wisconsin. Campbell refused to waive extradition at that time.

On October 16, 1987, a 30-day extension was granted by the District Court because the necessary extradition papers had not yet been processed. The Governor of the State of Montana signed a Governor’s Warrant for extradition on October 30, 1987, commanding that Campbell be apprehended on the original theft charges and additional charges of carrying a concealed weapon, reckless use of a weapon, and possession of tetrahydrocannabinol.

On November 16,1987, Campbell and his attorney appeared at the hearing held pursuant to the 30-day extension granted October 16, 1987. The District Judge directed that the Governor’s Warrant be served on the defendant and that the State of Wisconsin pick him up no later than one week from that date. The record reflects the following: that the Governor’s Warrant was served upon the defendant at the November 16 hearing in compliance with the court’s order; that Campbell was allowed to remain free on bail; and, the sheriff’s return of service of the warrant was filed with the clerk.

Paragraph seven of the stipulation of facts states:

“Defense counsel . . . was out of town during the week of November 22 through 29,1987. Because the defendant was released on bail, the Gallatin County Sheriff’s office did not know the whereabouts of the defendant. [Defense counsel’s] secretary would not divulge the defendant’s address to the sheriff’s office.

“Upon being told that the defendant was not in custody, and that the Gallatin County Sheriff could not guarantee that the defendant would appear on November 23,1987, the Wisconsin authorities sent no one to Montana to pick up the defendant . . .” (Emphasis added.)

The above time sequence is important because on November 16, 1987, the District Court stated Campbell had to be extradited by the Wisconsin authorities within a week.

At a November 23, 1987 meeting in the District Court chambers, acting defense counsel, since regular counsel was unavailable, made a motion to dismiss the proceedings. The court denied the motion. Nonetheless, the District Court informed the parties that the states of Montana and Wisconsin would have one more opportunity to extradite Campbell and that it would dismiss the extradition proceedings and Campbell would be released if extradition was not completed. The District Court did not state a specific time limit. On December 14, 1987, the County Attorney sent a letter to defense counsel which stated:

“The Sheriff has made arrangements with agents from the State of Wisconsin concerning Campbell. The Wisconsin authorities will be here on Wednesday, December 30, 1987, at 10:00 a.m., to take Campbell into custody.

“If you are still in contact with Campbell, please advise him concerning this date. If you are not in contact with Campbell, please advise the court so that other arrangements can be made.

“I trust that no further arrangements concerning this extradition will be necessary.”

On December 29, 1987, Campbell formally moved the court for an order dismissing the fugitive warrant on grounds that the statutory time limit had expired pursuant to Section 46-30-304, MCA. On December 30, 1987, Campbell again appeared before the court. On this date a police officer from Wisconsin was present in the courtroom for the purpose of returning Campbell to Wisconsin. However, rather than releasing Campbell to the Wisconsin authorities, the court made the following statement:

“THE COURT: Well, I don’t know if I’ve got the authority to do it, but I’m going to dismiss the matter and discharge the Defendant and quash the writ of extradition on the basis that the State of Montana and the State of Wisconsin have consistently failed to comply with Court orders about getting this Defendant out of here.

“For example, on September 14, 1987, I gave the State 30 days within which to extradite the Defendant. They came before me on October 16 and had not extradited him. I gave them another 30 days. On November 16 they came before me and still had not extradited him. I gave them 7 days to get him out of here, and it’s December 30 now. They still haven’t extradited him.

“You can take this matter up to the Supreme Court and get a writ of supervisory control or whatever you think empowers the States of Montana and Wisconsin to jack a defendant around like this.

“Let him go.”

The District Court also ordered exoneration of Campbell’s bail.

The District Court made no findings of fact or conclusions of law and from the bench dismissed the matter, discharged the defendant, and quashed the writ of extradition. It is from this ruling that the State appeals. The State timely filed a notice of appeal on January 13, 1988. The State requests this Court reverse the District Court and declare the Governor’s Warrant effective.

The State contends the District Court was required to honor the Governor’s Warrant once it was issued under the Uniform Criminal Extradition Act. Section 46-30-101, et seq., MCA. The State claims Campbell was not arrested on the Governor’s Warrant and therefore no time limitation ever began to run. Campbell’s claim is that he was not extradited within the time period prescribed in Section 46-30-304, MCA. This section, read along with Section 46-30-302, MCA, allows a 90-day time period that a party may be held in custody or on bond prior to discharge and a release from bail.

This 90-day limit was addressed by this Court in Petition of Blackburn (Mont. 1985), [215 Mont. 440,] 701 P.2d 715, 42 St.Rep. 525. In Blackburn, petitioner argued that Part 3 of Chapter 30, Title 46, MCA, imposed time limits on the issuance of the Governor’s Warrant. We held “the time limits in Section 46-30-302 and -304 refer only to the length of detention permitted before an accused person must be released from custody in the asylum state” and that “[t]hese sections do not require dismissal of extradition proceedings for any supposed time limits on issuance of the Governor’s Warrant.” Blackburn, 701 P.2d at 719.

Campbell claims he was arrested on the Governor’s Warrant on November 16, 1987, when he was served with the document at the hearing. Campbell therefore argues that the issue before this Court should be whether the District Court could release Campbell because the state of Wisconsin failed to physically transport him back to Wisconsin. Campbell claims Article IV, Section 2 of the United States Constitution controls in this instance. Campbell is correct that this section is applicable as it states:

“A person charged in any State with Treason, Felony, or other Crime, who shall flee from Justice, and be found in another State, shall on demand of the executive Authority of the State from which he fled, be delivered up to be removed to the State having Jurisdiction of the Crime.”

U.S.Const. art. IV, Section 2.

Campbell argues he should have been released because the Wisconsin authorities did not pick him up within 30 days after the Governor’s Warrant was served upon him and he became “arrested.” He claims the controlling federal law under 18 U.S.C. Section 3182 mandates that “[i]f no such agent appears within thirty days from the time of the arrest, the prisoner may be discharged.” (Emphasis added.) Therefore, Campbell claims, the District Court had the jurisdiction and authority to dismiss this case. We disagree. The court could discharge Campbell, if he was detained, or release him from bail in this instance, but the 30-day provision does not allow dismissal of the proceedings nor does it grant the court the ability to quash a writ of extradition.

Campbell recognizes that the authority is split as to whether the 30-day provision of 18 U.S.C. Section 3182 is mandatory or provisional. See generally, Long v. Cauthron (Ark.App. 1987), 731 S.W.2d 792; State v. Paskowski (Tenn.Cr.App. 1983), 647 S.W.2d 238; People v. Superior Court (Lopez) (1982), 130 Cal.App.3d 776, 182 Cal.Rptr. 132 (cases holding the 30-day limit in 18 U.S.C. Section 3182 is discretionary and not a mandatory “may discharge” on the court), and contra, Hill v. Roberts (Fla.App. 1978), 359 So.2d 911 (case holding word “may” in provision of 18 U.S.C. Section 3182 is mandatory, although the 30-day period is tolled for any delay attributable to fugitive).

In this instance, Campbell claims none of the delay is attributable to him. We note, nonetheless, that Campbell could not be located on November 23,1987 and it was because of this inability that the Gallatin County Sheriff informed the Wisconsin authorities not to come to Montana. To some extent, this delay can therefore be attributed to Campbell.

A district courts’ power of inquiry with regard to extradition proceedings is limited. The court can determine whether the documents are in order on their face; whether the petitioner was charged with a crime in the demanding state; whether petitioner is the person named in the extradition request; and whether petitioner is a fugitive. Blackburn, 701 P.2d at 717.

Here, the District Court summarily dismissed the extradition proceedings. The case of Carter v. Coleman (Fla.App. 1984), 443 So.2d 491, is instructive in this instance. The Carter court stated:

“[Dismissal of the entire proceeding [is] improper since the authority to honor or reject an extradition demand lies solely with the Governor . . .” (Citations omitted.)

“[W]e construe the language in the trial court’s order to mean that the trial court . . . intended only to dismiss its own court proceedings and to discharge the fugitive warrant and bail bond which it had issued therein. Such a discharge from bond or custody does not mean dismissal of all extradition proceedings. Thus, appellant’s rearrest on a valid Governor’s warrant issued after such discharge is not barred.” (Citation omitted.)

Carter, 443 So.2d at 492-493.

The Governor’s Warrant was legally effective on December 30, 1987, even though the 30-day limit had expired.

Our holding today is in accord with numerous states which have held that the time period involved in extradition proceedings is not mandatory but discretionary. Long, supra; Paskowski, supra; People v. Superior Court (Lopez), supra.

In Stynchcombe v. Whitley (1978), 240 Ga. 776, 242 S.E.2d 720, 721-722, the purpose behind the extradition statutes is stated in a situation similar to what we are faced with in this case. In Stynchcombe, 242 S.E.2d at 721, the court citing People ex rel. Gummow v. Larson (1966), 35 Ill.2d 280, 220 N.E.2d 165, stated:

“The purpose of these sections of the extradition law is to prevent unreasonably lengthy periods of confinement of fugitives pending consummation of extradition proceedings by the demanding state (citations) ...”

The court further stated in Stynchcombe, 242 S.E.2d at 722, citing In re Colasanti (1969), 104 N.J.Super. 122, 249 A.2d 1:

“The sections only limit the time during which one arrested as a fugitive may be kept in jail (or on bail in lieu thereof) pending the completion of extradition proceedings and the issuance of the governor’s arrest warrant.”

Our extradition statutes have the purpose of allowing the accused to be held in jail, or on bail as in this case, after the initial charge while awaiting the Governor’s Warrant. Additionally, the time limitations stated in the statutes suggest that the fugitive not be detained for an undue or unreasonable length of time. Accord, Breckenridge v. Hindman (1984), 10 Kan.App.2d 50, 691 P.2d 405; Application of Dunster (1974), 131 N.J.Super. 22, 328 A.2d 238. Here, Campbell was not detained or incarcerated but instead was free on bail.

The court should not have discharged the defendant where the more reasonable approach, since all parties were finally present before the court including the Wisconsin authorities, would have been to deliver the fugitive according to the Governor’s Warrant. The court did not have authority to quash the writ of extradition and the warrant was valid on that date.

We reverse the oral order of the District Court quashing the writ of extradition.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES WEBER and McDONOUGH concur.

MR. JUSTICE SHEEHY,

dissenting:

I dissent.

It is apparent from the record that the District Judge in this case became properly impatient with the unexplained delay of the Wisconsin authorities to consummate an arrest of the defendant under the Governor’s warrant. His court was being played with, the defendant’s rights were being ignored, and there is considerable doubt under the statutes of Montana and the federal laws that he had any further jurisdiction to hand over the defendant to Wisconsin.

The majority have misread or misinterpreted the applicable statutes here. The authority for Montana officials to arrest a defendant wanted in another state for a crime is found in Section 46-30-227, MCA. If the defendant does not consent to extradition, he must be committed to the county jail for not exceeding 30 days or admitted to bail, Section 46-30-302, MCA, to provide time to obtain a requisition from the demanding state. Upon receipt of the requisition, the Governor of this state may then issue an arrest warrant against the defendant. Section 46-30-213, MCA. The 30-day period is a limitation upon the power of Montana to hold the defendant without a requisition from the demanding state when Montana proceeds against him under Section 46-30-227, MCA.

In this case, the warrant from the Governor was not issued within the 30-day period. Campbell first appeared before the court on September 14, 1987, and the warrant of the Governor was not obtained until October 30, 1987. Yet the state had a statutory means to continue to hold the defendant under bail. It could have, under Section 46-30-304, MCA, moved the District Court for an additional 60 days. The defendant was entitled to his release at the end of that period or on November 13, 1987.

The state itself maintains that the defendant was never arrested under the Governor’s Warrant, only that he was served with a copy of it. Yet an arrest under the Governor’s warrant is the sine qua non of extradition proceedings. Only the Governor has the statutory power to issue a warrant of arrest which will result in the delivery of a defendant to another state’s jurisdiction. Section 46-30-201, MCA. Since no arrest occurred under the Governor’s Warrant, the defendant was clearly entitled to be discharged from custody at the expiration of the time extended by the District Court.

It is true that in this case the District Court stated it would quash the writ of extradition. Of course, the District Court had no such power. Yet discharging the defendant from custody in this case was proper. The defendant had not been arrested under the authority of the Governor’s warrant within the time permitted by the statutes. If the argument of the State is correct, the defendant was never arrested under the Governor’s warrant. The defendant was clearly entitled to be released from custody and his bond discharged.

Finally, nothing in this case prevents the state of Wisconsin from starting over and doing it right. This is the course that should have been followed here.


text:
    In the MATTER OF BARRY DAVID ZISKIND, an attorney at law, Respondent.
    No. 87-416.
    Decided Sept. 13, 1988.
    766 P.2d 218.
   OPINION AND ORDER

The Committee on Practice of the Supreme Court of the State of Montana filed a complaint in this Court charging Barry David Ziskind with violations of the Rules of Professional Ethics which apply to attorneys licensed to practice in the State of Montana. On September 30, 1987, a citation was issued to Mr. Ziskind. Mr. Ziskind filed his answer to the complaint on October 14, 1987.

A hearing was held before the Commission on Practice on January 21,1988. Thomas Lynaugh acted as special counsel. Mr. Ziskind had received proper notice of the hearing, but was not present. He did file a written brief which was introduced into evidence at the hearing. Evidence was presented at the hearing by Mr. Lynaugh on behalf of the prosecution. Subsequently the Commission on Practice issued its findings, conclusions, and recommendations dated February 23, 1988, which were filed in this Court on March 7, 1988. The Commission on Practice recommended that Mr. Ziskind be indefinitely suspended from the practice of law in the State of Montana. It further recommended that Mr. Ziskind be required to remit $88 to his former clients Rollin and Cindy Ficek for the balance due on their attorney fees and that he be required to pay all costs of the proceedings before the Commission. A copy of the Commission’s findings, conclusions, and recommendations was served upon Mr. Ziskind. The findings and recommendations of the Commission may be examined by interested parties in the office of the Clerk of the Supreme Court.

Mr. Ziskind filed his written objections to the Commission’s findings, conclusions, and recommendations on April 12, 1988. Mr. Lynaugh filed his response to the objections on April 29, 1988. In accordance with the rules governing the Commission on Practice, the matter was deemed submitted to the Supreme Court. The Court has reviewed the briefs and other matters in the file and the transcript and has concluded that oral argument is not required.

The Court has concluded that it is appropriate to impose the discipline upon Mr. Ziskind as recommended by the Commission on Practice. We will review briefly the findings and conclusions of the Commission.

Count One of the complaint against Mr. Ziskind involved his agreement to represent the Ficeks in a bankruptcy proceeding. The Ficeks first retained Mr. Ziskind in August of 1986. On September 15, 1986, the Ficeks returned to Mr. Ziskind a bankruptcy work sheet, signed the papers for the bankruptcy, and paid Mr. Ziskind a $228 retainer fee. Within a week after that date, Mr. Ziskind or his secretary called the Ficeks and told them that he could not handle their case because one of the creditors was a friend of his, and that he would refund their money by mail. When they had not received the refund after a week, the Ficeks called Mr. Ziskind’s office three or four times, but no one answered. Then they went to the office, only to find that it had been closed. The Ficeks were unable through further efforts to find Mr. Ziskind. They finally wrote to the Commission on Practice.

Mr. Ziskind, in his brief to the Commission, blames the failure to refund the fees to the Ficeks on an “apparent oversight.” Immediately prior to the Commission’s hearing, he offered a refund of $140 to the Ficeks, having deducted “actually earned costs and attorney fees.”

The Commission found that when Mr. Ziskind obtained the $228 retainer, he knew or should have known that he was going to leave the State within nineteen days and could not represent the Ficeks. It found that Mr. Ziskind had a duty to refund the fee and return his work product to the Ficeks. The Commission concluded that Mr. Ziskind violated Rules 1.16(d) and 8.4(c) of the Rules of Professional Conduct. We affirm the findings and conclusions of the Commission as to Count One.

Count Two of the complaint arises out of a lawsuit brought by Mr. Ziskind’s law firm to collect attorney fees owed to it. In that justice court action, Mr. Ziskind signed all the pertinent pleadings for his firm. In the course of the action, the deposition of the defendant former client was taken. Following that, Mr. Ziskind moved for summary judgment. In his brief in support of his motion for summary judgment, Mr. Ziskind set forth purported quotations from the deposition. The quotations were taken from two entirely different portions of the deposition, but were shown as one continuous quotation, resulting in a misleading representation of the testimony. The Commission found that it was “inconceivable” that, as Mr. Ziskind contended, these were merely clerical errors. The attorney for the clients brought this misrepresentation to the attention of the Justice Court, which imposed sanctions of $3,500 against Mr. Ziskind. The matter was appealed to district court, but the parties reached a settlement whereby the clients received a total payment of $3,000. The Commission found that Mr. Ziskind’s conduct under this count violated Rules 8.4(c), (d), and 3.3(a)(1), of the Rules of Professional Conduct. After reviewing the record, we affirm the findings and conclusions of the Commission as to Count Two.

The Commission dismissed Count Three of the complaint filed against Mr. Ziskind. We affirm that dismissal.

In his written objections to the Commission’s findings, Mr. Ziskind contends that there is no proof that his conduct in Count One constituted willful violation of the Rules of Professional Conduct and that he is entitled to retain that portion of the retainer paid by the Ficeks which he earned. He maintains that his failure to refund the remainder of the fees was inadvertent. As to Count Two, he continues to assert that the misleading nature of the quotations from the deposition is inadvertent. He also argues that the incident described in Count Two should not be considered because the Justice Court’s sanctions against him were appealed and then settled. However, he has presented nothing which would prohibit the Commission’s and this Court’s consideration of his underlying conduct in filing the brief with the misleading quotations. Mr. Ziskind asks that he be continued in good standing as a member of the State Bar of Montana and that he not be taxed with the costs of the Commission’s proceedings. From his brief, the Court concludes that Mr. Ziskind continues to refuse to take responsibility for his actions which led to the proceedings before the Commission.

The Supreme Court of the State of Montana unanimously concludes as follows:

1. That Mr. Ziskind shall be suspended from the practice of law indefinitely.

2. That Mr. Ziskind shall be required to pay the Ficeks $88.

3. That Mr. Ziskind shall pay all costs of the proceedings before the Commission on Practice as a condition precedent to his reinstatement to the practice of law.

IN ORDER TO CARRY OUT THE FOREGOING, THE COURT ORDERS:

1. That Mr. Ziskind’s suspension from the practice of law in the State of Montana shall commence immediately.

2. The Secretary of the Commission on Practice shall furnish to this Court and to Mr. Ziskind a statement of Commission costs. Within 90 days, the Secretary shall communicate to the Court Mr. Ziskind’s response to this order requiring that he pay the Commission costs. Mr. Ziskind’s response shall be part of the record in these proceedings for purposes of any request for reinstatement.

3. Copies of this order shall be mailed to Mr. Ziskind, Thomas Lynaugh, the Ficeks, the Chairman of the Commission on Practice, George Bousliman, Executive Director of the State Bar of Montana, each of the District Judges of the State of Montana, and to each of the United States District Judges for the District of Montana. Copies of this order shall also be sent to the State Bar of California (attn: Richard Gomez), 555 Franklin, San Francisco, California, 94102-4498; and to Ms. Gina Maclellan, Nevada State Bar, 295 Holcomb, Suite 2, Reno, Nevada, 89502.

DATED this 13th day of September, 1988.

s/J.A. Turnage, Chief Justice

s/John Conway Harrison, Justice

s/William E. Hunt, Sr., Justice

s/Fred J. Weber, Justice

s/John C. Sheehy, Justice

s/R.C. McDonough, Justice

s/L.C. Gulbrandson, Justice


author: MR. JUSTICE HARRISON MR. JUSTICE WEBER,

text:
    DAVID ALARIC PALMER, a protected person, by MARTHA ROSE DIACON, his conservator, Plaintiff and Respondent, v. FARMERS INSURANCE EXCHANGE, Defendant and Appellant.
    No. 87-459.
    Submitted Aug. 9, 1988.
    Decided Sept. 13, 1988.
    761 P.2d 401.

      Smith, Baillie & Walsh, William J. Gregoire argued, and James R. Walsh, Great Falls, argued, for defendant and appellant.
    Dennis P. Conner, Great Falls, argued, John C. Risjord, Kansas City, Mo., for plaintiff and respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

The defendant, Farmers Insurance Exchange, appeals a 9-3 jury verdict from the Eighth Judicial District, Cascade County, finding it liable for $50,000 under two uninsured motorist policies to cover a motorcycle accident in which David Alaric Palmer suffered head injuries.

Palmer was injured on June 10, 1984, when his southbound 750-cc motorcycle went off the east side of U.S. 89 approximately fifteen miles north of White Sulphur Springs, Montana. His family subsequently filed claims for $25,000 in uninsured motorist protection on each of two policies issued by the defendant, claiming that a red semi tractor-trailer traveling north had forced Palmer off the road and had not stopped after the accident. The defendant refused the claims. It cited the Highway Patrol officer’s report that attributed the accident to Palmer’s recklessness and excessive speed. Neither Palmer, who is not able to recall the accident, nor the driver of the tractor-trailer, who was never identified or located, testified.

Serena Diacon was riding as a passenger on Palmer’s motorcycle at the time of the accident and suffered only cuts and bruises. She testified at trial that Palmer was driving south at about 50 m.p.h. when they came to a right-hand curve in the highway. On the east side of this curve (to the left of Palmer’s southbound motorcycle), Stud Horse Road enters the highway. Serena testified that Palmer was about two and one-half feet from the center line in his proper lane when she looked over Palmer’s shoulder and saw the tractor-trailer “half in our lane and half in their lane.” This northbound tractor-trailer, which was straddling the center line of the highway, was traveling between 60 and 70 m.p.h., Serena testified. She said she ducked behind Palmer and braced herself as he swerved to the left; she could not say whether Palmer passed in front of or behind the tractor-trailer. The motorcycle traveled across the northbound lane of traffic, across the approach to Stud Horse Road, and flew off an adjacent embankment in pretty much of a straight line.

The only other witness to testify as to the position of the tractor-trailer was Frank Atchison, a water truck driver, who was following the tractor-trailer some 100 yards back. His testimony was that the tractor-trailer was so far to the right side of its proper lane of travel that it kicked up dirt and dust as it passed over the approach to Stud Horse Road. Through that dirt and dust, Atchison said he saw a “flash” that he thought was a motorcycle going off the road, but did not know whether it passed in front of or behind the tractor-trailer. Atchison stopped at Stud Horse Road, where he had planned to turn off originally, and helped Serena Diacon as she climbed up the embankment. Atchison testified that he was gaining on the tractor-trailer when the accident occurred and was driving 45 m.p.h. Thus, he said he believes the tractor-trailer was traveling no faster than 40 m.p.h. and believes the motorcycle was traveling more than 55 m.p.h. The defense presented other witnesses who testified that a red tractor pulling a trailer stopped several hundred yards north of the accident scene to inform them that he thought he, had seen through his side mirrors a motorcycle going off the road behind him.

The investigating Highway Patrol officer diagrammed the scene and measured skid marks. He testified that the motorcycle’s skid marks started just east of the center line (in the northbound lane), and extended in roughly a straight line off and on for 90 feet before reaching the dirt road, and then the embankment. His measurements show that the motorcycle was airborne for twenty-eight feet from this point and rolled another twenty-four feet. The patrolman did not learn of the tractor-trailer’s alleged involvement in the accident until one day later, when he talked to Serena. However, he inspected both lanes of traffic on the day of the accident and found no skid marks or other signs that a northbound vehicle had braked suddenly or hit any object. He testified that this indicates the motorcycle passed behind the tractor-trailer. Although his original report said the accident was caused by Palmer’s excessive speed, he said at trial that he no longer has an opinion as to the cause of the accident.

The plaintiff presented various experts to testify as to the speed of the motorcycle. Professor Denman Lee, a Montana State University physicist, testified that the length of the skid marks, the height of the embankment, and the distance of flight indicated the motorcycle was traveling about 28 m.p.h. when it became airborne as it left the embankment, and about 48 m.p.h. at the point on the highway where it started to leave skid marks. Robert “Evil” Knievil, a motorcycle stunt driver, testified that had the motorcycle been traveling more than 25-30 m.p.h. when it left the embankment it would have been airborne farther. Also introduced as evidence were ambulance reports that indicated Palmer had been injured when his motorcycle left the road “at a moderate rate of speed” and a physician confirmed that Palmer’s injuries were consistent with moderate, speed, over defense’s objection that such testimony was impermissible hearsay as well as irrelevant.

The defendant raises these issues:

1. Did the District Court err when it allowed medical evidence concerning the injuries even though the defendant had stipulated to the severity of the injuries?

2. Did the District Court err by allowing the plaintiff to display certain video tapes to the jury?

3. Did the District Court issue an improper “sudden emergency” instruction?

4. Did the District Court err in computing prejudgment interest?

We affirm on all counts except for the last one. We remand the court’s order granting prejudgment interest for a new order consistent with this opinion.

This case presented difficulties in proof for both parties. In a sense each party was attempting to prove a negative since Palmer was asserting an unidentified tractor-trailer driver, not he, was responsible for the accident. In turn, the defendant asserted that this same unidentified tractor-trailer driver was nowhere near the center line of the highway, let alone straddling or crossing it. The jury voted 9-3 to accept Palmer’s version.

This Court presumes the verdict of a jury properly instructed on the law to be correct and will accept the evidence in a light most favorable to the prevailing party. Mountain West Farm Bureau Insurance v. Girton (Mont. 1985), [215 Mont. 408,] 697 P.2d 1362, 1363, 42 St.Rep. 500, 501. We do not disturb lightly the verdict of a competent jury, Gee v. Egbert (1984), 209 Mont. 1, 18-19, 679 P.2d 1194, 1203. Instead we determine if substantial credible evidence exists in the record to support that verdict and, if such evidence exists, to affirm. Clark v. Norris (Mont. 1987), [226 Mont. 43,] 734 P.2d 182, 184-85, 44 St.Rep. 444, 445; Gibson v. Western Fire Insurance Co. (Mont. 1984), 210 Mont. 267, 682 P.2d 725, 736, 41 St.Rep. 1048, 1058; Wilhelm v. City of Great Falls (Mont. 1987), [225 Mont. 251,] 732 P.2d 1315, 1321, 44 St.Rep. 211, 218. However, we emphasize that because the questions of fact in this case are so close, we will afford the jury that heard the evidence the utmost discretion. This is not to be read as an endorsement of the jury’s verdict since we may well have decided differently on the facts of the case.

Medical Evidence

Dr. William Tacke, a rehabilitation specialist, testified that initial ambulance reports and emergency room records from the White Sulphur Springs Hospital indicate that Palmer had suffered no fractures and that the bones of his face and skull were not damaged in the accident. He also testified that admission records from the Montana Deaconess Medical Center in Great Falls showed no thoracic or spinal injuries. Dr. Tacke testified that such results are consistent with a moderate rate of speed and describes Palmer’s injury as a “closed-head injury,” which is where brain damage occurs without a skull fracture. The defendant objected to this witness’ testimony claiming that liability was the only question at issue before the jury and such medical evidence is not probative of which driver was at fault. It also argued that the testimony represented impermissible hearsay.

As the physician in charge of Palmer’s rehabilitation, Dr. Tacke may testify concerning health records made by other health professionals if he has relied on them in forming opinions or inferences. Klaus v. Hillberry (1971), 157 Mont. 277, 285-86, 485 P.2d 54, 58-59; In the Matter of the Mental Health of G.S. (Mont. 1985), [215 Mont. 384,] 698 P.2d 406, 409-10, 42 St.Rep. 451, 454-55; Garza v. Peppard (Mont. 1986), [222 Mont. 244,] 722 P.2d 610, 613, 43 St.Rep. 1233, 1237; Rule 703, M.R.Evid. Dr. Tacke first saw Palmer as a consultant for neurologists who were treating him and later worked with Palmer when he was deemed stable enough for rehabilitation. In these roles he used other physicians’ records, charts, and reports to treat Palmer. When the physician uses pther professionals’ reports to advise a patient or to provide care, any hearsay objection to those reports fails. Ankenny v. Grunstead (1976), 170 Mont. 128, 133-34, 551 P.2d 1027, 1031. Thus, the defendant’s hearsay objection to the physician’s testimony was properly denied.

The physician’s testimony also was relevant to the case. Besides noting that the injuries were consistent with moderate speed, the physician also testified that Palmer suffers from post-traumatic amnesia and remembers nothing about the accident. Both parties to this suit attempted to prove the other driver was traveling at excessive speed while they were driving at a reasonable pace. A lack of bodily injuries is useful to show the force of the impact, thereby creating an inference as to speed. See, Knuth v. Murphy (1952), 237 Minn. 225, 54 N.W.2d 771, 775. In Goodnough v. State of Montana (1982), 199 Mont. 9, 647 P.2d 364, we held that the circumstantial evidence that moments before an accident the car’s occupants were seen miles away relieving themselves was admissible to create an inference as to speed because its probative value outweighed its prejudicial nature. Goodnough, 647 P.2d at 368, citing Rule 403, M.R.Evid. In this case, Dr. Tacke’s testimony was brief and concise. Because defense counsel had the right to cross-examine but chose not to do so, we find no prejudice.

At the conclusion of his rebuttal case, Palmer offered Plaintiff’s Exhibit 6.1, the White Sulphur Springs Emergency Room report; 6.2, a dismissal form from the Montana Deaconess dated September 29, 1984; and 6.3 the White Sulphur Springs ambulance report. The defendant claimed these records lacked foundation and were not the best evidence since no custodian came forth to verify the records. The District Court admitted the records as Rule 803(6) business records exceptions to the hearsay rule.

Ordinarily such documents would not be self-authenticating. See Rule 902, M.R.Evid. However, the defense had stipulated to the authenticity of a series of medical records including these three and had agreed there would be no need to call a medical librarian. Exhibits 6.1 and 6.3, prepared the same day as the accident by trained professionals, make no mention of alcohol being present or absent from Palmer’s system. This serves to rebut a defense witness’ claim that he smelled alcohol on Palmer as Palmer lay in the ditch after the accident.

The defense asserts on appeal that its concession that such records are authentic does not by itself make the medical reports admissible. The fact that it had agreed that neither side would need to call a records custodian and had opened the door on evidence concerning alcohol eliminates any harmful error in admitting this evidence. Under these particular circumstances we will affirm on this issue since the defense has been unable to identify any specific portion of the reports as inaccurate.

Plaintiff’s Use of Video Tapes

Defendant argues that the District Court erred when it allowed counsel for Palmer to use Plaintiffs Exhibit 11 as a demonstration and to enter Exhibit 23 into evidence. Exhibit 11 shows Evil Knievil driving southbound through the curve at various speeds on a 750 — cc motorcycle. Exhibit 23 was a video tape made by the defense attorneys for their use in preparing their case. It shows the curve from different angles and at one point the camera is mounted on the dashboard of a car as it drives through the curve. We deal first with Exhibit 11.

This tape was shot from the shoulder on the east side of the highway directly adjacent to the northbound lane of traffic. The first several seconds of this video tape show a semi-tractor and trailer driving in a northerly direction in the wrong lane of traffic. It is apparent from the video tape that the right inside rear wheel of the trailer is tracking along the center line of the highway. This places the left side of the tractor and trailer well within the southbound lane. This tractor-trailer was not hired as part of a reconstruction or demonstration; it just happened to be driving through the area as the tape was made.

Serena Diacon testified that the tractor-trailer shown in this tape occupies “the exact position” on the road as the red tractor-trailer occupied on the day of the accident. She voiced this opinion after viewing this video tape two times almost three years after the accident. Serena admitted in voir dire by defense attorneys that she had seen no other tapes of trucks on that curve from which to choose which best represented the position of the red tractor-trailer. She also noted that she saw the red tractor-trailer on the day of the accident from the front and this video tape showed the truck from behind. However, she said she knew the tractor-trailer on the tape was in the same position by looking at the center line as it appears beneath the truck. The defense objected to this demonstration as prejudicial and lacking foundation.

Exhibits used for demonstration purposes are admissible if they supplement the witness’ spoken description of the transpired event, clarify some issue in the case, and are more probative than prejudicial. Workman v. McIntyre Construction Co. (Mont. 1980), [190 Mont. 5,] 617 P.2d 1281, 1291, 37 St.Rep. 1637, 1650, citing 29 Am.Jur.2d, Evidence Section 785. Movies are considered to be reliable if they are accurate and relevant with any change in circumstances explained. Brown v. North American Manufacturing Co. (1978), 176 Mont. 98, 117, 576 P.2d 711, 722. The admission of such evidence lies solely in the discretion of the District Court and we will not reverse unless a manifest abuse of discretion is shown. Brown, 576 P.2d at 722. A focal question in this case concerns where the red tractor-trailer was located on the highway prior to the accident. Since Serena testified that this video tape shows that location it is relevant. Questions concerning this video tape go not to its admissibility for demonstrative purposes, but rather to the weight to be given it.

As it admits or rejects various pieces of evidence, the District Court must bear in mind Rule 403, M.R.Evid.:

“Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.”

To reduce the prejudicial effect of Exhibit 11, the District Court admonished the jury before Serena testified:

“THE COURT: Ladies and gentlemen, prior to the testimony of this witness, I want to read you a cautionary instruction.

“ ‘During the next witness’ testimony, you will see a video demonstration which the Court has ruled may be shown. This video tape was taken by the Plaintiff’s attorney approximately two-and-a-half years after the accident.

“ ‘The video tape shows a semi truck and trailer over the center line on U.S. highway 89 approaching the Stud Horse intersection from the south. It is offered only to demonstrate visually the testimony of Serena Diacon. You are not to consider this video tape for any other purpose. It is not allowed for the purpose of showing that there is any general tendency for semi trucks to cross the center line on the curve in question. In viewing the video, you should consider the effect that the location of the camera operation had on the path taken by the semi. You should also consider the presence of a vehicle on the right side of the highway.’ ”

This admonition advises the jury that Exhibit 11 is only a visual illustration of a part of Serena’s testimony and that it must be considered along with all other evidence and that it is not proof that trucks routinely cross the center line. In addition, the jury is told to consider what effect the position of the camera had on the path of the truck. This admonition is proper and serves to alleviate any prejudice in Exhibit 11. We find no abuse of discretion in admitting it for demonstrative purposes.

The video tape labeled Plaintiff’s Exhibit 23 was made the day that surveyor Herbert Sherburne measured the curve for defendants but Sherburne testified that he had no role in producing the video tape and had never viewed it until the day he testified. Sherburne testified that his measurements show the vigilant driver approaching the curve from the north would have been able to see a 13-foot 4-inch high semi truck and trailer 750 feet away from the point Palmer’s skid marks began.

Palmer introduced the exhibit through Sherburne in order to impeach his calculation. The defense objected to this use of Exhibit 23 because Sherburne had not made the video tape, knew little about photography and was not aware of what type of lens was used to make the video tape, could not locate his survey stakes on the video tape and could not be expected to determine distances on a two-dimensional screen. The District Court cited the video tape’s probative value, overruled the objection, and directed plaintiff to show the video tape at normal speed.

Sherburne need not be the maker of the video tape to introduce it. Pickett v. Kyger (1968), 151 Mont. 87, 97, 439 P.2d 57, 62. A video tape will be allowed as long as it shows a true representation of the scene at the time in question or any difference is explained. Lamb v. Page (1969), 153 Mont. 171, 176-77, 455 P.2d 337, 340; Pilgeram v. Hass (1946), 118 Mont. 431, 449, 167 P.2d 339, 348. Because the defendant’s witness had testified a driver in Palmer’s lane should have been able to see a truck 750 feet away, Palmer had the right to test the witness on that assertion and to impeach him if he could.

To do this Palmer played Exhibit 23, which at one point showed a tractor-trailer driving north and negotiating the curve. As this truck moved, Palmer’s counsel on several occasions froze the frame on the tape so he could ask Sherburne how far away the truck was and whether it was in its proper lane of travel. On three occasions when counsel for Palmer asked Sherburne to indicate what distance on the screen represented 750 feet the defense objected and was sustained by the court. On another occasion when counsel for Palmer asked Sherburne if anything had been edited out of the tape, the defense objected and was sustained. By doing so the District Court exercised its discretion not only in permitting the video tape into evidence but also in policing the cross-examination. We find no manifest abuse of discretion that would warrant reversal.

In rejecting this issue of defendant’s appeal, we rely on what appears to be the fair application of discretion by the District Court. The defendant makes a strong argument that these video tapes were not intended to demonstrate any witness’ testimony or impeach any other witness so much as they were intended to constantly display to the jury a tractor-trailer either over the center line or right up against the center line. We will not pass judgment here upon that. The District Court’s prompt and effective use of discretion in this case protected the relevancy of this evidence from damaging prejudice.

Instruction No. 13

The defendant claims the District Court improperly gave a sudden emergency instruction. Instruction No. 13 read:

“The following traffic regulations of the State of Montana are designed to enhance safety on the public highways of this State:

“ T. A vehicle shall be driven as nearly as practicable entirely within a single lane and shall not be moved from such lane until the driver has first ascertained that such movement can be made with safety.

“ ‘2. A person operating or driving a vehicle of any character on a public highway of this State shall drive it in a careful and prudent manner so as not to unduly or unreasonably endanger the life, limb, property, or other rights of a person entitled to the use of the street or highway.

“ ‘3. A person operating or driving a. vehicle of any character on a public highway of this State shall drive it in a careful and prudent manner, and at a rate of speed no than is reasonable and proper under the conditions existing at the point of operation, taking into account the amount and character of traffic, condition of brakes, weight of vehicle, grade and width of highway, condition of surface and freedom of obstruction to view ahead, and he shall drive it so as not to unduly or unreasonably endanger the life, limb, property or other rights of a person entitled to the use of the street or highway.’

“If you find that the unidentified truck driver or David Palmer violated one of the statutes just read to you, you will find that such violation was negligence unless on behalf of such party its [sic] is proven by a preponderance of the evidence that he did what might reasonably be expected of a person or ordinary prudence [sic], acting under similar circumstances, who desired to comply with the law. In order to sustain such burden of proof, such party must prove by a preponderance of the evidence that he was faced with circumstances which prevented compliance or justified noncompliance with the statute.”

The defendant’s objection concerns the final paragraph of the instruction. This Court has ruled:

“[A sudden emergency instruction] adds nothing to the law of negligence and serves only to leave an impression in the minds of the jurors that a driver is somehow excused from the ordinary standard of care because an emergency existed. This is not the law.”

Simonson v. White (Mont. 1986), [220 Mont. 14,] 713 P.2d 983, 989, 43 St.Rep. 133, 141-42. The use of a sudden emergency instruction was “banned” in automobile accident cases. White, 713 P.2d at 990.

The instruction read to the jury in the present case is more than a sudden emergency instruction. It presents three standards of care expected of all drivers of motor vehicles and says the failure to live up to the standards by any driver constitutes negligence. It requires the jury to decide not whether a sudden emergency erupted but whether either driver in this case was negligent forcing the other to take protective measures. Because it is more concrete than the instruction disapproved of in White, 713 P.2d at 989, and because it speaks to both drivers, we hold that this instruction is one in comparative negligence, not one in sudden emergency.

The defendant points out typographical errors exist in the final paragraph but there is no record that any objection was made while settling the instructions as to these typographical errors or that the jury was confused by typographical errors. The misphrase “person or ordinary prudence” is harmless in the context of the instruction because it is clear that the instruction refers to the actions of a reasonable person, i.e. the “person of ordinary prudence.” There is no appreciable difference and no harm has been done.

Prejudgment Interest

The District Court’s amended judgment imposes prejudgment interest of 10 percent per year from July 13, 1984, which was 30 days after the claim had first been presented. Farmers asserts error since the policy’s language strictly limits Farmers’ liability only to the amount of coverage and also because the court misused the statute on awarding prejudgment interest. We find this second contention persuasive.

Three conditions must be met before Section 27-1-211, MCA, applies. First, there must be an underlying monetary obligation; second, the amount of recovery must be certain or capable of being made certain by calculation; and third, the right to recovery must vest on a particular day. Agri-Lease, Inc. v. Gray (1977), 173 Mont. 151, 160, 566 P.2d 1114, 1118-19; Safeco Insurance Co. v. Lovely Agency (Mont. 1985), [215 Mont. 420,] 697 P.2d 1354, 1356, 42 St.Rep. 509, 511-12; Byrne v. Terry (Mont. 1987), [228 Mont. 387,] 741 P.2d 1341, 1343, 44 St.Rep. 1620, When liability is contested, as it was here, the conditions fail since no monetary obligation exists until the day the jury determines the degrees of comparative negligence. The right to recover does not vest until the jury renders its verdict. McPherson v. Schlemmer (Mont. 1988), [230 Mont. 81,] 749 P.2d 51, 54, 45 St.Rep. 33, 37. Palmer’s right to recovery, therefore, did not vest until the jury returned its special verdict form on March 13, 1987 finding the unidentified driver of the red tractor-trailer negligent and Palmer not negligent. Palmer has no right to interest before the date of the verdict.

Finally, we note that the parties bifurcated the bad faith insurance claim from this matter of liability and the bad faith claim is still pending. In his recitation of facts on this appeal, Palmer has mentioned that Farmers denied his claims in 1984. At that time Farmers claimed its uninsured motorist policies did not take effect unless there was “physical contact” with a “phantom vehicle.” Farmers believed such a provision to be lawful at the time. It was not until June 19, 1985, one year later, that this Court held in McGlynn v. Safeco Insurance Co. (Mont. 1985), [216 Mont. 379,] 701 P.2d 735, 42 St.Rep. 882, that such a policy provision runs contrary to the public policy and therefore is unconstitutional. McGlynn, 701 P.2d 739-40. We do not believe that Farmers’ adherence to a policy it considered to be lawful and which was later declared unconstitutional establishes any liability upon the insurer for the time period before the policy was struck down. We therefore would urge counsel for Palmer, if he elects to proceed on the bad faith insurance claim, to prosecute that case on allegations concerning the insurer’s actions subsequent to the McGlynn decision.

Affirmed in part, reversed in part.

MR. JUSTICES McDONOUGH, SHEEHY and HUNT concur.

MR. JUSTICE WEBER,

dissenting:

I dissent from the majority opinion because Instruction No. 13 was both unnecessary and confusing. Further, the use of a sudden emergency instruction such as the one in the last paragraph of Instruction No. 13 was disapproved in White.

Paragraph 2 of Instruction No. 13 is a statement of law that a driver shall drive “in a careful and prudent manner so as not to unduly or unreasonably endanger the life, limb, property, or other rights of a person entitled to the use of the street or highway.” Paragraph 3 is a statement of law which requires persons to drive “in a careful and prudent manner” taking into account the conditions of traffic, the vehicle, the surface, and the view ahead. The last paragraph of the instruction then states that if one of the parties acted in a way which “might reasonably be expected of a person [of] ordinary prudence” but which was not in compliance with one of the above laws, there is no negligence. Read together these statements seem to excuse a person from acting in a careful and prudent manner. That is not an accurate statement of law.

As this Court has stated such an instruction “adds nothing to the law of negligence and serves only to leave an impression in the minds of the jurors that a driver is somehow excused from the ordinary standard of care because an emergency existed.” White, 713 P.2d at 989. I would remand for retrial without the use of an instruction like Instruction No. 13.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICE GULBRANDSON concur in the foregoing dissent.


text:
    The STATE OF MONTANA, Plaintiff and Respondent, v. PATRICK MARK TRACY, Defendant and Appellant.
    No. 88-173.
    Submitted on Briefs Aug. 4, 1988.
    Decided Sept. 13, 1988.
    761 P.2d 398.
    Cannon & Sheehy, Edmund F. Sheehy, Jr., Helena, for defendant and appellant.
    Mike Greely, Atty. Gen., Paul D. Johnson, Asst. Atty. Gen., Mike McGrath, Co. Atty., Leo Gallagher, Deputy Co. Atty., Helena, for plaintiff and respondent.
   MR. JUSTICE McDONOUGH

delivered the Opinion of the Court.

Patrick Mark Tracy appeals from a judgment of the District Court of the First Judicial District, Lewis and Clark County. The judgment was entered pursuant to a jury verdict finding Tracy guilty of the crime of theft (common scheme), a felony. We affirm.

Tracy presents two issues for review:

1. Whether the evidence was sufficient to sustain the jury’s verdict convicting Tracy of felony theft (common scheme).

2. Whether the District Court properly imposed a minimum 10-year sentence on Tracy as a persistent felony offender under Section 46-18-502(2), MCA.

A summary of the facts is as follows: Tracy was hired as a janitor by Universal Floor Maintenance on September 8, 1987. Part of his job was to clean the Thriftway North store in Helena. A manager and checker at the store, Bob Day, testified at trial that on the evening of September 27, 1987, Tracy cashed over 30 winning Montana lottery tickets at Day’s checkstand and another checkstand.

The fact that Tracy cashed so many winning tickets on the same day and the fact that he did so in separate transactions struck Day as odd. He notified his employer, Thriftway President Frank Capps, about his concern. Capps in turn contacted Montana State Lottery Security Director John Onstad. Onstad also received reports that Tracy had cashed 30 other winning tickets at State Lottery Héadquarters as of September 29, 1987, all of which were stamped “Thriftway North.”

Capps and Onstad investigated. They began keeping track of the numbers on the beginning and ending lottery tickets in the store’s dispensers at the end of each business day. The numbers were then rechecked each morning when the store opened to see if any tickets were missing. They also began nighttime surveillance of the store when janitors would be working.

On the evening of October 3, 1987, Capps and Onstad hid themselves in the store and observed Tracy as he arrived for work. After store personnel had left, Tracy came to the front of the store and appeared to wave at someone outside the store. He then took a shopping cart to the cigarette rack and loaded it with an estimated 50-70 cartons of cigarettes. Onstad took a photograph of Tracy while he was loading the cigarettes onto the cart. Tracy took the cart-load of cigarettes to the back of the store, and the two hidden men heard it pass through the swinging metal doors that separate the shopping area from storage areas in the rear of the store. A few minutes later, Tracy returned with the cart, which was then empty.

Tracy then began to go about his work. While he was doing so, Capps went to the rear of the store to look for the cigarettes. He was unable to find them, and returned to his hiding place. A short time later, the two men observed Tracy removing lottery tickets from the dispensers and placing them inside his pants. He then turned out the lights and left the store.

Capps and Onstad left their hiding place and intercepted Tracy. They brought him back into the store and notified the police. A Helena police officer testified that when he arrived, he searched Tracy and found two bundles of lottery tickets (a total of 213 tickets) stuffed down the front of his pants. A search of the rear of the store at that point also failed to reveal the missing cigarettes. Tracy was then placed under arrest. Subsequent searches of the store for the missing cigarettes were likewise unsuccessful, but Capps did discover that the locking mechanism on one of the rear doors could be manipulated to enable someone to open it far enough to pass items outside.

Onstad testified that lottery tickets are sold to merchants for 95 cents apiece and resold for one dollar. The tickets found on Tracy’s person thus had a wholesale value of $202.35, and a retail value of $213.00. Capps testified that the missing cigarettes had a wholesale value of $576.20, and a retail value of $634.10. Capps also testified that since Tracy’s arrest, Thriftway had experienced no problems with lottery tickets.

The jury returned a verdict of guilty on December 2, 1987. At the sentencing hearing held January 20, 1988, Tracy was sentenced to ten years in prison for felony theft and 50 years of imprisonment as a persistent felony offender, with 40 years of that sentence suspended. This appeal followed.

I.

Tracy was charged under Section 45-6-301, MCA. Under Section 45-6-301(6), MCA, theft is a felony if the value of the property involved is at least $300. Tracy admits to being guilty of misdemeanor theft in connection with the lottery tickets found on him when he was arrested. However, he argues that the evidence was insufficient to prove that he exercised control over other lottery tickets and cigarettes of sufficient value to constitute a felony. He argues that the evidence introduced at trial connecting him to the theft of these additional items was based on “conjecture, probability or suspicion.”

The test applied by this Court to determine whether the evidence is sufficient to support a criminal conviction is whether, after reviewing the evidence in the light most favorable to the State, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. State v. McHugh (Mont. 1985), [215 Mont. 296,] 697 P.2d 466, 42 St.Rep. 371. If the evidence conflicts, it is for the trier of fact to determine which evidence is dispositive. State v. Oman (Mont. 1985), [218 Mont. 260,] 707 P.2d 1117, 42 St.Rep. 1565.

The statutory definition of theft used in charging Tracy reads as follows:

“(1) A person commits the offense of theft when he purposely or knowingly obtains or exerts unauthorized control over property of the owner and:

“(c) uses, conceals, or abandons the property knowing such use, concealment, or abandonment probably will deprive the owner of the property.”

Section 45-6-301(1)(c), MCA. In addition to the 213 lottery tickets found on Tracy’s person, the record contains testimony by two witnesses that Tracy cashed a total of 64 tickets marked “Thriftway North” under circumstances that aroused their suspicion. Tracy was employed as a night janitor at the store when he cashed those tickets. Capps and Onstad testified to having observed Tracy removing lottery tickets from store dispensers while in the store for the purpose of cleaning. Capps further testified that his audit showed tickets with a total value of $1,000 to be missing, and that after Tracy’s arrest, the ticket thefts ceased.

Capps and Onstad also testified to having observed Tracy remove between 50 and 70 cartons of cigarettes from a rack at the front of the store. Onstad photographed Tracy in the course of this activity. Capps testified that Tracy did not have permission to exercise control over the cigarettes. Both men testified that when Tracy returned from the storage area at the back of the store, the shopping cart into which he had placed the cigarettes was empty. Both men also testified that repeated searches failed to locate the cigarettes. The value of the cigarettes was placed at over $500.

From this evidence, a reasonable trier of fact could conclude that Tracy obtained unauthorized control over property valued at over $300 belonging to Thriftway, and concealed or used it knowing that his actions would deprive Thriftway of the property. We conclude the evidence introduced at trial was sufficient to sustain Tracy’s conviction.

II.

Tracy also argues that he was improperly sentenced as a persistent felony offender. Tracy admits that he was properly designated a persistent felony offender, but disputes the court’s imposition of a 50-year sentence with 40 years suspended. Section 46-18-502, MCA, provides the criteria for sentencing a persistent felony offender:

“(1) Except as provided in Subsection (2), a persistent felony offender shall be imprisoned in the state prison for a term of not less that 5 years or more than 100 years or shall be fined an amount not to exceed $50,000, or both, if he was 21 years of age or older at the time of the commission of the present offense.

“(2) If the offender was a persistent felony offender, as defined in 46-18-501, at the time of his previous felony conviction ... he shall be imprisoned in the state prison for a term of not less than 10 years or more than 100 years or shall be fined an amount not to exceed $50,000, or both.”

According to Tracy, the court incorrectly based its sentence on Subsection (2) of the statute. Tracy argues the court’s sentence amounts to imposing the minimum of 10 years for a defendant who was a persistent felony offender at the time of his previous conviction. Tracy was not designated a persistent felony offender in his previous conviction, and he argues that he should have received a sentence of only 5 years under Subsection (1).

The State counters that Tracy could have been designated a persistent felony offender in his previous conviction based on his record at that time. The State argues that the language of the statute does not require that the defendant actually be designated a persistent felony offender in his previous conviction in order to come under Subsection (2).

A judge is vested with wide discretion when imposing a sentence on a convicted defendant. If the sentence imposed is within the limits provided by statute, it is not an abuse of discretion. State v. Garrido (Mont. 1981), [190 Mont. 525,] 621 P.2d 1105, 38 St.Rep. 78. Section 46-18-502(1), MCA, grants the judge discretion to sentence a persistent felony offender to not less than 5 or more than 100 years in prison. The sentence imposed by the judge in this case is within the range authorized by the statute. The judge did not abuse his discretion in imposing a 50-year sentence with 40 years suspended based on Tracy’s designation as a persistent felony offender.

We affirm the decision of the District Court.

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