text:
    IN RE THE MARRIAGE OF SANDY JO CONVERSE, Petitioner and Appellant, and EDWIN FRANK CONVERSE, a/k/a EDWIN FRANK WELLS, Respondent and Respondent.
    No. 91-194.
    Submitted on briefs September 5, 1991.
    Decided February 21, 1992.
    49 St.Rep. 162.
    252 Mont. 67.
    826 P.2d 937.

      For Petitioner and Appellant: Susan Gecho Gobbs, Havre.
    For Respondent and Respondent: Cregg W. Coughlin, Altman & Boucher, Havre.
   JUSTICE HUNT

delivered the Opinion of the Court.

This is an appeal by the wife from a decree of dissolution entered in the Twelfth Judicial District Court, Hill County, Montana. Both parties stipulated to all of the contested issues associated with the dissolution and the decree was then entered. The wife then made a motion to alter or amend the judgment in regard to the custody provisions on the grounds that said provisions did not accurately reflect the stipulation of the parties. The District Court denied this motion and the wife appeals. We reverse.

We phrase the issue before this Court as follows:

Did the District Court err in determining custody without first considering the mandatory statutory guidelines for making custody determinations found at § 40-4-212, MCA?

Appellant Sandy Converse and respondent Edwin Converse were married in July 1977. The parties separated in October 1989, and the wife filed a petition for dissolution in April 1990. The parties are the parents of four minor children. Atemporary custody order was issued with the wife as the custodial parent. A restraining order was also issued ordering the husband to not have any contact with either the wife or the four minor children.

A trial date was set for August 1990. The wife’s petition for dissolution included a prayer for joint custody of the four children. Prior to trial, the parties stipulated that the wife could amend the petition to request sole custody. The August 1990 trial date was continued until October 29, 1990. Prior to trial, the parties had mutually agreed on many of the issues relating to the dissolution. On the morning of the trial, the parties met with the District Court Judge in chambers, at the request of the Judge, to determine if the remaining contested issues could be settled to the satisfaction of the parties without a trial. While in chambers and off the record, the attorneys apparently reached a settlement agreement. After taking the agreement to their clients, the stipulated terms of the decree were reiterated for the record.

The District Court instructed the wife’s counsel to draft a decree of dissolution reflecting the stipulations of the parties. On November 27,1990, the proposed decree was submitted to the court. Counsel for the husband objected to the terms relating to custody of the children, alleging these terms did not accurately reflect the agreement that had been reached by the parties. The court agreed with counsel for the husband that the proposed decree did not reflect the agreement of the parties and instructed counsel for the wife to draft another proposed decree with custody provisions in line with the stipulation.

Eventually the court drafted the decree which was entered on January 4, 1991, along with the court’s findings of fact and conclusions of law. The custody provision of the decree reflected the understanding of both the husband’s counsel and the court as to the terms of the stipulation. The wife filed a motion pursuant to Rule 59, M.R.Civ.P., to delete the portion of the decree concerning custody to which the wife alleges she did not agree. It is from the District Court’s denial of this motion that the wife appeals.

Did the District Court err in determining custody without first considering the mandatory statutory guidelines for making custody determinations found at § 40-4-212, MCA?

Written agreements in which parties to a dissolution stipulate to the terms of the dissolution are encouraged in this state, both for purposes of judicial economy and to promote the “amicable settlement of disputes between parties to a marriage attendant upon their separation or the dissolution of their marriage ...” Section 40-4-201, MCA. In the present case, it was an in-court oral stipulation by the parties and not a formal written separation agreement, but the distinction is unimportant. In re Marriage of Mager (1990), 241 Mont. 78, 785 P.2d 198. However, while encouraged, these agreements are not binding upon the district court judge as to support, custody, or visitation. Section 40-4-201, MCA. Even if both husband and wife stipulate to custody, the judge is not bound by that stipulation, but may instead order a different custody arrangement in accord with the best interests of the children. Mager, 785 P.2d at 200. Section 40-4-212, MCA, mandates that custody determinations must be based on the best interests of the children. The rationale underlying this policy was set out by this Court in In re Marriage of Neiss (1987), 228 Mont. 479, 743 P.2d 1022. In Neiss, we stated that “[i]t is the children, not the parents, who are beneficiaries of child support decrees,” and “the custody and support of children are never left to contract between the parties.” Neiss, 743 P.2d at 1024.

Section 40-4-212, MCA, requires custody determinations be made in accordance with the best interests of the children as determined by the district court after considering the following criteria:

“(a) [T]he wishes of the child’s parent or parents as to his custody;
“(b) the wishes of the child as to his custodian;
“(c) the interaction and interrelationship of the child with his parent or parents, his siblings, and any other person who may significantly affect the child’s best interest;
“(d) the child’s adjustment to his home, school, and community; “(e) the mental and physical health of all individuals involved;
“(f) physical abuse or threat of physical abuse by one parent against the other parent or the child; and
“(g) chemical dependency, as defined in 53-24-103, or chemical abuse on the part of either parent.”

This list is not all inclusive. This Court has suggested that the parents’ ability to cooperate in their parental roles and the geographical proximity of the parents’ residences are at least two additional factors which should be considered. In re Custody and Support of B.T.S. (1986), 219 Mont. 391, 395-96, 712 P.2d 1298, 1301. Section 40-4-223, MCA, also provides that in awarding joint custody consideration must be given to which parent is more likely to allow the child frequent and continuing contact with the noncustodial parent.

When reviewing custody issues this Court must first determine if the factors set out in § 40-4-212, MCA, were considered by the district court. In re Marriage of Jacobson (1987), 228 Mont. 458, 743 P.2d 1025. While it is encouraged, the trial court need not make specific findings on each of the factors. However, failure by the trial court to at least consider all of the statutorily mandated factors is error. In re Marriage of Speer (1982), 201 Mont. 418, 654 P.2d 1001. The custody determination must be based on substantial evidence relating to the statutory factors and must be set forth explicitly in the findings. In re Marriage of J.J.C. and P.R.C. (1987), 227 Mont. 264, 739 P.2d 465. The findings should, at a minimum, set forth the “essential and determining facts upon which the District Court rested its conclusion on the custody issue.” In re Marriage of Cameron (1982), 197 Mont. 226, 231, 641 P.2d 1057, 1060 (quoting In re Marriage of Barron (1978), 171 Mont. 161, 580 P.2d 936). This Court has refused to uphold an award of custody when the district court’s findings indicated that not all of the statutory factors had been considered, even though the extensive record in the case indicated that the district court had received substantial evidence on each of the factors. In re Marriage of Keating (1984), 212 Mont. 462, 689 P.2d 249.

In the present case, there is nothing in the record before this Court demonstrating that the statutory criteria for making custody determinations were considered by the trial court. If some or all of the factors were considered during the off the record conference between the trial judge and counsel for the parties, this is not reflected in the record. Even if the relevant factors had been considered, there was nothing in the trial court’s findings indicating the basis for the custody decision in relation to the factors. The findings of the District Court simply indicated that the custody decision was in the best interest of the children without elaborating further.

It is clear that the District Court Judge attempted to bring the parties together in order to encourage an amicable settlement to their disputes without having to resort to a trial. While the District Court’s effort to bring the parties together is laudable, we hold that the District Court erred in not giving consideration to the statutory criteria found at § 40-4-212, MCA, and in failing to explicitly state the basis for the custody decision in the findings.

We remand this case to the District Court to receive evidence relative to the statutory factors necessary for a determination of custody and for explicit findings setting forth at least the “essential and determining facts” upon which the District Court rests its conclusion on custody.

Reversed and remanded.

JUSTICES HARRISON, GRAY, McDONOUGH and TRIEWEILER concur.


source: Caselaw Access Project

author: JUSTICE HUNT JUSTICE TRIEWEILER,

license: Public Domain

text:
    JAY ANDERSON, Claimant, Respondent, and Cross-Appellant, v. JERRY D. HAMMER and STATE COMPENSATION MUTUAL INSURANCE FUND, Defendant, Appellant, and Cross-Respondent.
    No. 90-587.
    Submitted January 14, 1992.
    Decided February 21, 1992.
    49 St.Rep. 165.
    252 Mont. 73.
    826 P.2d 931.

      For Respondent and Cross-Appellant: Chris J. Ragar, Beck Law Offices, Bozeman.
    For Appellant and Cross-Respondent: Kelly M. O’Sullivan, Agency Legal Services Bureau, Helena.
   JUSTICE HUNT

delivered the Opinion of the Court.

The original opinion in this case, dated September 16, 1991, and filed that same date, was withdrawn on November 22, 1991. We hereby clarify that original opinion.

The Workers’ Compensation Court awarded claimant 500 weeks of permanent partial disability benefits at the rate of $57.86 per week. Both claimant and the State Fund appeal.

We reverse and remand as to issues one and three. We affirm issue two.

Claimant raises the following issue:

1. Whether in computing lost earning capacity, the Workers’ Compensation Court erroneously compared 1981 “old dollars” to 1990 “new dollars” without updating the 1981 figures.

The State Fund raises two additional issues:

2. Whether the Workers’ Compensation Court erred in finding that claimant suffered a whole person injury and therefore was entitled to 500 weeks of benefits.

3. Whether the Workers’ Compensation Court erred in failing to include the value of room and board provided to claimant by his employer as part of bis compensation in the calculation of his post-injury wages.

Claimant Jay Anderson, a cowboy, maintained a sporadic and short term pre-injury work history. He worked as a laborer in the summer months for his uncles as a block layer and carpenter. He was not fully apprenticed in either occupation. He sheared sheep for his father for approximately two months a year. In 1979, claimant began working for the Peavey Company as a feed plant operator. He worked in that position for about two and one-half years. His ending salary was $5.35 per hour.

In 1981, claimant began working as a ranch hand for Mr. Hammer. His typical duties included fencing, calving, herding cattle, and repairing bridges. On July 23,1986, while trying to round up a stray calf, claimant fell from his horse. The horse rolled on top of him, fracturing his left upper arm. At the time of the injury, claimant was earning $650 per month. In addition to a monthly salary, Hammer provided claimant with fringe benefits which included a mobile home, lunches, one-half of a beef per year, and some pasturage for claimant’s horse.

Claimant’s X-rays revealed a comminuted fracture through the mid-shaft of the left humerus. Dr. Frank Humberger, an orthopedic surgeon, noted radial nerve palsy of the left arm. On July 24, 1986, Dr. Humberger performed surgery on claimant’s left humerus to stabilize the bone. Claimant’s arm failed to heal properly. In April 1988, Dr. Humberger performed a successful bone graft to stimulate healing. Subsequently, claimant’s humerus healed. However, claimant developed significant problems with the radial nerve. He experienced numbness and considerable pain in the left upper extremity. Claimant continued to work for Hammer but has had significant pain when performing his tasks.

Dr. Humberger stated that claimant has residual problems in his shoulder consisting of bicipital tendonitis, significant symptoms of rotator cuff tendonitis, and symptoms of subacromial bursitis. He also testified that claimant will continue to have permanent residual problems from the arm injury and that claimant has reached maximum healing with regard to his injury.

The State Fund’s witness, Dr. Canty, assigned an impairment rating of 15 percent permanent partial impairment of the upper left extremity. This represented a nine percent permanent partial impairment of the whole person. Based on this conclusion, the State Fund paid a Holton award of 45 weeks at claimant’s permanent partial disability rate of $149.50 per week. Dr. Canty did not disagree with Dr. Humberger’s deposition and he agreed that the orthopedic surgeon should ultimately decide what the claimant could and could not do for employment activities.

Gary Lusin, a licensed physical therapist, examined claimant on November 3 and December 13, 1989, to prepare a Functional Capabilities Assessment (FCA). The FCA qualified claimant for the medium physical demand level. The medium range required lifting 50 to 75 pounds on an occasional basis, 20 pounds frequently, and 10 pounds constantly. Claimant just met the lower threshold requirement of the medium physical demand level. In Mr. Lusin’s opinion, claimant had a limited range of motion of combination shoulder flexion and abduction, and limited external rotation of the left shoulder. He found visible and palpable atrophy over the infraspinatus, teres minor, trapezius, and pectoralis, and weakness throughout the rotator cuff muscles.

Norm Johnson, an employment counselor, met with claimant and reviewed the depositions of claimant, Drs. Humberger and Canty, Jerry Hammer, Gary Lusin, and Karen Black. Johnson administered the General Aptitude Test Battery to claimant. The results of the test demonstrated that claimant would be slow in jobs requiring numerical skills and hearing skills, as well as general learning skills and reasoning ability. Johnson concluded claimant has a pre-injury earning capacity at Peavey in Miles City of $7.10 per hour, plus $1.56 per hour in fringe benefits, with seven years experience. Johnson’s contact with an individual at Peavey (now Con Agra) indicated that entry level employees started at $5.00 per hour and went up to $5.50 per hour after 60 days.

Karen Black, a vocational expert, contacted a personnel officer who stated that a feed plant operator earned from $6.00 per hour to $6.50 per hour at the entry level. Black testified she did not know what claimant’s pre-injury earning capacity was. She also did not estimate claimant’s decrease of access to the labor market. She concurred that claimant’s current employment should be limited within the range of the FCA.

On August 27, 1990, the Workers’ Compensation Court issued its findings. The court concluded that as a result of his injury, claimant’s ability to earn in the open labor market had been substantially reduced. The court concluded claimant was entitled to 500 weeks of permanent partial disability benefits at the rate of $31.00 per week because he suffered an injury to the whole person and not just to his left arm. The court rejected claimant’s lost earning capacity based upon jobs as a construction laborer or hod carrier because claimant lacked experience in those areas.

In the original order, the court made a mathematical error with regard to claimant’s pre-injury wage. The claimant moved to amend the decision and requested a rehearing, asking the court to reconcile its finding of Peavey pre-injury wages of $5.35 per hour, with its later conclusion that claimant earned $5.25 per hour to correct a mathematical error, and to update the claimant’s 1981 Peavey wages to the present time for the purposes of pre-injury earning capacity. The court amended its earlier decision by finding that claimant’s Peavey wages were $5.35 per hour and that claimant’s lost earning capacity is $2.15 per hour. The court granted claimant 500 weeks of benefits at $57.36 per week, but refused to update claimant’s 1981 wages to 1990 and denied the rehearing. Both claimant and the State Fund appealed from the original and amended order.

On September 16, 1991, this Court issued an opinion which reversed and remanded on issue one and affirmed as to issues two and three. In the original opinion, we held that the value of room and board provided by the employer should not be included in the calculation of claimant’s post-injury wages. On September 30, 1991, the State Fund petitioned this Court for a rehearing on this issue. On November 22,1991, this Court granted the petition for rehearing and classified this case for oral argument. Oral argument was limited to discussion of whether the value of room and board provided by the employer should be included in the calculation of claimant’s post-injury wages. On January 9, 1992, this Court, sitting en banc, heard oral argument. We now issue the following opinion.

I

Whether in computing lost earning capacity, the Workers’ Compensation Court erroneously compared 1981 “old dollars” to 1990 “new dollars” without updating the 1981 figures.

Because the injury occurred prior to 1987, pre-1987 statutory and case law applies. Watson v. Seeking (1988), 234 Mont. 309, 312, 763 P.2d 328, 331.

We will not disturb a decision by the Workers’ Compensation Court where there is substantial credible evidence to support the findings of the court. Dunn v. Champion International Corp. (1986), 222 Mont. 142, 147, 720 P.2d 1186, 1189. Claimant argues that the court failed to bring his pre-injury earning capacity of $5.35 per hour in 1981 to 1990 wage levels. We agree. As we have previously stated:

“The ultimate objective of the disability test is by discounting the above variables to determine the wage that would have been paid in the open labor market under normal employment conditions to claimant as injured, taking wage levels, hours of work, and claimant’s age and state of training as of exactly the same period used for calculating actual wages earned before the injury.”

McDanold v. B.N. Transport, Inc. (1984), 208 Mont. 470, 480, 679 P.2d 1188, 1193 (quoting Fermo v. Superline Products (1978), 175 Mont. 345, 349, 574 P.2d 251, 253).

The court found claimant’s pre-injury earning capacity at Peavey to be $5.35 per hour and his post-injury earning capacity to be $3.20 per hour. The court then subtracted the 1990 post-injury earning capacity from the 1981 pre-injury earning capacity to find claimant’s lost earning capacity. “This method is a misapplication of the law in Olson [v. Manion’s Inc. (1973), 162 Mont. 197, 510 P.2d 6] and directly contradicts later holdings of this Court that pre-injury and post-injury wages must be compared for the same period of time.” McDanold, 679 P.2d at 1193. It is patently unfair to compare wages in 1990 to wages in 1981. McDanold, 679 P.2d at 1193. The court should take into account increases in wages during the periods of pre-injury earning capacity and post-injury earning capacity.

“[Ejaming capacity must be measured by comparing pre-injury earning capacity with post-injury earning capacity in the same time frame. So, in order to properly calculate claimant’s permanent partial disability rate, we would need to know what the job claimant held in September of 1978 would pay today. No evidence was presented as to that pay rate.”

Lamb v. Missoula Imports, Inc. (1988), 230 Mont. 183, 198, 748 P.2d 965, 967.

Here evidence indicated that claimant’s wages increased over the last nine years. Norm Johnson testified by deposition that Peavey would pay $7.10 per hour, plus fringe benefits, after seven years of experience. He also testified that his contacts with Peavey indicated entry level employees started at $5.00 per hour and increased to $5.50 per hour after 60 days. Karen Black testified that entry level jobs at Peavey would pay between $6.00 and $6.50 per hour. In addition, claimant testified he received pay raises over his two and one-half years of working at Peavey. There is no evidence that Peavey wages have remained static over nine years. Therefore, the court must determine what claimant would have earned in 1990 as a plant operator.

Claimant requested that this Court issue a finding regarding claimant’s pre-injury wage because the evidence comes from deposition testimony. Dunn, 720 P.2d at 1189. We decline to do so because of the conflicting nature of the testimony regarding claimant’s preinjury wage. Instead, we remand to the Workers’ Compensation Court to determine claimant’s pre-injury earning capacity.

II

Whether the Workers’ Compensation Court erred in finding that claimant suffered a whole person injury and therefore was entitled to 500 weeks of benefits.

The State Fund relied primarily on § 39-71-705(1), MCA (1985), which reads as follows:

“(1) In addition to temporary total disability benefits allowed in this chapter, indemnity benefits for loss of a member shall be paid at the weekly rate provided in 39-71-703 and shall be paid for the following periods: one arm at or near shoulder........280 weeks

The court held that claimant was permanently partially disabled and entitled to 500 weeks of permanent partial disability benefits because the injury was not limited to the arm and shoulder area, but to the “whole person.” There is substantial credible evidence to support the court’s finding. Dr. Humberger stated that claimant continued to experience intermittent problems of pain associated with the radial nerve injury. The radial nerve is easily reinjured whenever claimant bumps the arm. Claimant complained of pain over the apex of the shoulder and over the shoulder blade. He complained of pain in and about the shoulder when lifting and carrying. The soft tissue injuries claimant suffered are permanent. The doctor stated claimant has had symptoms of bicipital tendonitis, rotator cuff tendonitis, and symptoms suggestive of subacromial bursitis. Claimant would continue to have residual problems. The doctor stated that these symptoms were a result of the accident in 1986.

Mr. Lusin testified that claimant suffered from atrophy in the infraspinatus, teres minor, upper trapezius, and pectoralis. Claimant’s FCA report confirmed claimant’s weakness in the left shoulder and upper extremity which appear to be a result from the injury. The State Fund’s witness, Dr. Canty, did not disagree with Dr. Humberger’s opinion with regard to claimant’s injury.

Claimant’s testimony was consistent with the conclusions of the doctor and physical therapist. He stated his chest muscles would start tightening up and aching. He had pain in and around the shoulder area.

The State Fund argued that Obie v. Obie Sons, Inc. (1963), 143 Mont. 1, 386 P.2d 68, was controlling. In that case, we overturned a district court’s finding on appeal from the Industrial Accident Board that claimant was entitled to 500 weeks of benefits because the court did not have any additional evidence relating to the physical condition of the claimant. In this case, we will not disturb the Workers’ Compensation Court’s findings where there is substantial evidence to support those findings. Dunn, 720 P.2d at 1189. We conclude that there is substantial evidence to uphold the Workers’ Compensation Court’s finding of a whole person injury.

Ill

Whether the Workers’ Compensation Court erred in failing to include the value of room and board provided to claimant by his employer as part of his compensation in the calculation of his post-injury wages.

In determining claimant’s post-injury earning capacity, the Workers’ Compensation Court used claimant’s $750 monthly salary and did not include room and board. The court arrived at $3.20 per hour as claimant’s post-injury earning capacity.

The relevant statute is § 39-71-116(20), MCA(1985), which defines wages as:

“[T]he average gross earnings received by the employee at the time of the injury for the usual hours of employment in a week, and overtime is not to be considered. Sick leave benefits accrued by employees of public corporations, as defined by subsection (16) of this section, are considered wages.”

Previously, we have interpreted this definition of “wages” as simply meaning gross earnings. Scyphers v. H & H Lumber (1988), 237 Mont. 424, 426, 774 P.2d 393, 394. In Scyphers, this Court adopted the economic gain standard in determining what constituted gross income. Scyphers, 774 P.2d at 394. The distinction rested upon whether the payment was actually a reimbursement for employment-related expenses, or whether the payment consisted of a real economic gain to the employee. Scyphers, 774 P.2d at 394. We approved of the analysis as described by Professor Larson in his treatise on workers’ compensation:

“In computing actual earnings as the beginning point of wage-basis calculations, there should be included not only wages and salary but any thing of value received as consideration for the work, as, for example, tips, bonuses, commissions and room and board, constituting real economic gain to the employee. [Emphasis added.]”

2 Larson, The Law of Workmens’ Compensation, § 60.12(a) (1989).

In Scyphers, the claimant, a long haul truck driver, was compensated by the employer at a rate of $0.14 per mile, plus $0.03 per mile “per diem.” The claimant was not required to keep records of expenses for meals and lodging. Instead, the employer simply paid the “per diem” amount. We concluded that the three-cents-per mile “per diem” was not a reimbursement to the injured employee for out of pocket expenses, but instead constituted real economic gain. Scyphers, 774 P.2d at 394-95.

The Court notes that in 1987 the legislature enacted § 39-71-123, MCA, providing that “[w]ages include but are not limited to ... (b) board, lodging, rent, or housing if it constitutes a part of the employee’s remuneration and is based on its actual value ....”

In this instance, room and board was provided to claimant as partial compensation for working on the ranch. The room and board was not a reimbursement to the claimant for out-of-pocket expenses, rather it constituted a real economic gain to the claimant. We hold that the value of the room and board constituted gross earnings and that it be included in claimant’s post-injury wages. We affirm as to issue two. We reverse and remand issues one and three to the Workers’ Compensation Court to determine claimant’s pre-injury earning capacity, and if possible on the record before it, the value of the room and board.

CHIEF JUSTICE TURNAGE and JUSTICES HARRISON, GRAY, McDONOUGH and WEBER concur.

JUSTICE TRIEWEILER,

specially concurring:

I concur with the result of the majority opinion, but do not agree with all that is said in part III of that opinion.

Specifically, I disagree that § 39-71-116(20), MCA (1985), is the relevant statute under which to analyze claimant’s disability benefits pursuant to § 39-71-703, MCA (1985). Partial disability benefits, pursuant to § 703, are based upon the difference between pre-injury and post-injury “earning capacity.” Wages are only one factor to be considered and are not determinative of either pre-injury or post-injury capacity. However, I agree that the value of claimant’s room and board were relevant to a determination of claimant’s post-injury earning capacity, just as it is relevant to a determination of his pre-injury earning capacity.

I also fully agree with the Court’s decision in Issues I and II of its opinion.


author: JUSTICE HUNT

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. ARNOLD WEST, Defendant and Appellant.
    No. 91-310.
    Submitted on briefs October 31, 1991.
    Decided February 25, 1992.
    49 St.Rep. 170.
    252 Mont. 83.
    826 P.2d 940.

      For Appellant: Richard J. Carstensen, Attorney at Law, Billings.
    For Respondent: Marc Racicot, Attorney General; Deanne L. Sandholm, Assistant Attorney General, Helena; John S. Forsythe, Rosebud County Attorney, Forsyth.
   JUSTICE HUNT

delivered the opinion of the Court.

Defendant Arnold West was convicted of driving under the influence of alcohol by a jury trial in the Montana Sixteenth Judicial District Court, Rosebud County. Defendant appeals the conviction. We affirm the District Court.

Defendant raises the following issues for appeal.

1. Whether the District Court erred when it denied defendant’s motion in limine to prohibit two witnesses’ testimony because the State failed to provide defendant with a copy of the statement of one of the witnesses.

2. Whether the District Court erred when it refused defendant’s jury instruction defining a voluntary act.

3. Whether there was sufficient foundation to introduce into evidence the results of an alcohol breath test.

4. Whether the State’s references to presumptions based on the results of an alcohol breath test prejudiced the defendant.

5. Whether the Justice Court had original jurisdiction because the penalty imposed for a DUI conviction exceeds the definition of a misdemeanor.

6. Whether the District Court erred when it excluded jury instructions that the State must prove that the defendant acted purposely and knowingly.

On the evening of October 18,1989, Sharyle Lallatin and her sister Caryle Jenrich were leaving a movie theater in Colstrip, when they noticed defendant in a nearby parking lot. In an effort to gain their attention, he yelled and waved at them. The women did not understand what the defendant was saying and they quickly proceeded to their car. As they were leaving the scene, the women saw the defendant back his pickup into a parked car. Lallatin left the car in order to obtain the defendant’s license number. She was able to obtain the number and reported the incident to the sheriff’s office.

In the meantime, Jenrich followed the defendant so that she could report the location of the defendant. After a few minutes, the defendant pulled into the parking lot of a bowling alley. Jenrich drove to the sheriff’s office and reported the incident, as well as the location of the defendant, to the dispatcher. While at the sheriff’s office, Jenrich prepared and signed a written statement. She was then given a copy of her statement.

Rosebud County Deputy Sheriff Charles Hartman and Officer Mitchell Moe responded to the call. When they arrived at the bowling alley, they located the defendant’s pickup in the back parking lot. The license plates of the vehicle were registered in the defendant’s name. Finding the defendant sitting at a bar in the bowling alley talking to a waitress, the officers escorted him outside. After being questioned, the defendant admitted to being at the parking lot near the movie theater and driving to the bowling alley. The officers observed that the defendant’s speech was extremely slurred, his walking was staggered, and he emitted an odor of an alcohol. The waitress told one of the officers that she refused to serve the defendant alcohol because of his intoxicated state.

Officer Hartman returned to the scene of the hit and rim but could not find any physical evidence that a car had been struck. Except for the two women, no one else reported to the sheriff’s office that a vehicle had been hit on that night.

Officer Moe performed the usual field sobriety tests on the defendant in the parking lot of the bowling alley. Defendant failed the horizontal nystagmus test and could not perform the one-leg-stand balancing test. The defendant was placed under arrest for driving under the influence of alcohol in violation of § 61-8-401, MCA (1989). Approximately one and one-half hours had elapsed from the time the women witnessed the accident to the time defendant was arrested.

On January 12, 1990, defendant was initially found guilty in a non-jury trial before a justice of the peace. Defendant appealed the case to District Court and was convicted by a six person jury on July 12, 1990. On September 5, 1990, defendant appealed his conviction. On January 30,1991, we remanded the case to District Court because the court gave a jury instruction on mandatory conclusive presumption of intoxication which was contrary to our holding in State v. Leverette (1990), 245 Mont. 124, 799 P.2d 119. On April 9, 1991, defendant was tried and convicted of the same offense. On April 10, 1991, the court entered its judgment. Defendant was fined $300, given a six month suspended sentence, ordered to pay costs, and required to attend an alcohol treatment program. Defendant appeals the conviction and judgment of the District Court.

I

Whether the District Court erred when it denied defendant’s motion in limine to prohibit two witnesses’ testimony because the State failed to provide defendant with a copy of the statement of one of the witnesses.

On the morning of the second District Court trial, defense counsel filed a motion in limine to exclude the testimony of Jenrich and Lallatin because the State failed to produce a copy of Jenrich’s written statement which was given to the sheriff’s office on the night of the incident. The District Court denied the motion and ordered the State to question the witnesses as to whether either of them had a copy of any such statement. Jenrich testified that she had thrown away her copy and no statement was ever produced. Defendant argues that allowing the testimony of the two witnesses constituted prejudicial error.

Section 46-15-322(l)(a), MCA (1989), requires that the State disclose “a list of the names and addresses of all persons whom the prosecutor intends to call as witnesses in the case-in-chief, together with their relevant written or recorded statements.” There is a continuing duty placed upon the prosecution throughout the course of the criminal proceedings to disclose relevant materials. Section 46-15-327, MCA (1989). The statutes go into effect when “the State actually develops the knowledge of a specific act, fact, or information that exculpates the defendant.” State v. Shaver (1988), 233 Mont. 438, 447, 760 P.2d 1230, 1235.

This Court established the following standard for lost or destroyed evidence:

“[TJhat when the State, due to negligence, loss, replacement or destruction, is unable to produce certain physical evidence in the prosecution of the case, reversal of a conviction is not necessary where the actual objects were not vital to the defense, were not exculpatory in nature, and the result would not have been affected by their introduction.”

State v. Halter (1989), 238 Mont. 408, 412, 777 P2d 1313, 1316 (citing State v. Ronald Lee Craig (1976), 169 Mont. 150, 545 P.2d 649).

In California v. Trombetta (1984), 467 U.S. 479, 488-89, 104 S.Ct. 2528, 2534, 81 L.Ed. 2d 413, 422, the United States Supreme Court added the following:

“Whatever the duty the Constitution imposes on the States to preserve evidence, that duty must be limited to evidence that might be expected to play a significant role in the suspect’s defense. To meet this standard of constitutional materiality [citation omitted], evidence must both possess an exculpatory value that was apparent before the evidence was destroyed, and be of such a nature that the defendant would be unable to obtain comparable evidence by other reasonably available means.”

In this case, defense counsel had other reasonable means to obtain comparable evidence. At the first District Court trial, Jenrich testified that she had a copy of the statement that she had given to authorities. Defense counsel had approximately nine months before the start of the second trial to either interview the witness or request the county attorney to provide him with a copy of the statement. Neither the sheriff’s office nor the county attorney had an original or copy of the statement in their possession. Jenrich testified that she had thrown away her copy of the statement. In addition, defense counsel failed to allege the exculpatory value of the evidence, or how the introduction of the written statement could have changed the result of the trial. We hold that the District Court did not err in denying defendant’s motion in limine.

II

Whether the District Court erred when it refused Defendant’s jury instruction defining a voluntary act.

Defense counsel proposed the following jury instruction:

“In order to prove the charge of Driving a Motor Vehicle While Under the Influence of Alcohol, the State must prove beyond a reasonable doubt that the offense was committed knowingly by such Defendant as a voluntary act.
“The word ‘act’ means a thing done or that which is done. It includes any bodily movement, any form of communication and, where relevant, a failure or omission to take action. [Emphasis added.]”

In State v. McDole (1987), 226 Mont. 169, 175, 734 P.2d 683, 686, we held that “[d]riving under the influence is an absolute liability offense not requiring the proof of the mental state by the State.” Section 61-8-401(7), MCA (1989), states that “[a]bsolute liability as provided in 45-2-104 will be imposed for a violation of this section.”

The basic reason for not requiring the state to prove mental intent in DUI cases is that:

“[Situations could arise in which defendants could not be convicted under the statute because they were too intoxicated to form the requisite intent. The paradoxical and absurd result would be that the more intoxicated the driver became the better his chances of avoiding liability under the statute.”

McDole, 734 P.2d at 686 (quoting Erwin, Defense of Drunk Driving Cases, § 1.05 (1986).

The proposed jury instruction required the State to prove the defendant knowingly committed the offense. Absolute liability statutes do not require proof of a mental state. We hold the District Court did not err in refusing the jury instruction defining a voluntary act.

Ill

Whether there was sufficient foundation to introduce into evidence the results of an alcohol breath test.

When a defendant is charged with driving under the influence of alcohol, he is “entitled to any procedural safeguards in the Administrative Rules of Montana.” State v. O’Brian (1989), 236 Mont. 227, 229, 770 P.2d 507, 508. Section 23.4.209 ARM (1989) required:

“(1) All models of breath-testing instruments used to administer testing according to section 61-8-405 MCA, must be approved by the division. The models operated by certified operators and/or operator supervisors prior to and on the effective date of this ride are deemed approved by the division.
“(2) Each breath-testing instrument must be inspected by the division, and the accuracy verified by the division, prior to installation of the instrument.”

Defendant contends that the State failed to lay proper foundation proving that the intoxilyzer was properly tested and certified prior to administering the test on the defendant.

Officer Moe testified that he was certified to operate the intoxilyzer and that he calibrated and tested the instrument to insure that it would accurately measure the defendant’s breath. He also testified that in order for the intoxilyzer to take an accurate reading, the instrument must be calibrated at .100. He then testified, and the record reflects, that the instrument was properly calibrated at .100 immediately prior to administering the test to defendant.

In addition, the record contains a letter dated May 11,1990, from the Forensic Science Division of the Justice Department. It stated that the division had inspected and verified the intoxilyzer in the Rosebud County Sheriff’s Office and that it met all of the Division’s requirements at the time of installation. The letter also stated that Officer Moe was a certified operator because he had completed the Breath Test for Intoxilyser School which was required before he completed his police training in 1989.

We have stated “that the District Court has latitude of discretion in passing on the admissibility of evidence.” State v. Hall (1989), 244 Mont. 161, 169, 797 P.2d 183, 188. We will only overturn the district court’s determination on the admissibility of evidence when there has been an abuse of discretion. Hall, 797 P.2d at 188. We hold there was sufficient foundation and that the District Court did not abuse its discretion in admitting the results of the alcohol breath test.

IV

Whether the State’s references to presumptions based on the results of an alcohol breath test prejudiced the defendant.

Defendant alleges that the State made continual references and placed evidence before the jury relating to a presumption of intoxication. In its opening statement, the prosecution stated:

“And then a central piece of evidence would be the results of a breathilizer [sic] test. And we expect that this evidence to be introduced, will show that Mr. West, blowing into the machine, registered a point two-seven alcohol content. And this will be an important number to keep in mind when you receive the Court’s instructions as to what level is the presumption of intoxication. [Emphasis added.]” Officer Moe testified in direct examination to the following:
“Q. How did he exhibit that lack of understanding?
“A. He was just — when I asked him to come along, or asked him back to my car, he didn’t know what I was asking, and he just acted very intoxicated.
“MR. CARSTENSEN: I object, Your Honor, again, and ask that the answer be stricken.
“MR. FORSYTHE: As to intoxicated?
“THE COURT: Sustained as to the origin [sic] which indicated he was very intoxicated.
“Q. So that we don’t keep going through this, this is an ultimate conclusion for the jury and we’ll ask you not to state the standard of intoxication....
“Q. And your testimony was that you found the maximum of six points, three for each eye; is that correct?
“A. Yes. The normal is if you receive four points, they’re usually at point one. And then the forty-five degree angle is, if it’s there they’re usually over about point one.
“MR. CARSTENSEN: Your Honor, I object and move to strike the answer; it’s unresponsive and not proper foundation.
“COURT: Do you have an offer of proof?
“MR. FORSYTHE: No, I’ll withdraw that particular question and answer as to the alcohol levels.
“THE COURT: The jury is directed to disregard the testimony as with respect to any particular percentage of alcohol level.”
In closing, The State made the following argument:
“He was at 2.7, 2.7 times .1. So you know, you have powerful evidence of intoxication which is based on scientific results of tests of the air that the defendant breathed. It’s incontrovertible evidence.
“MR. CARSTENSEN: I object. I don’t believe that’s the law in Montana.
“THE COURT: Sustained. The jury will disregard the last statement of Mr. Forsythe that this is incontrovertible. You do have the instructions and ....
“Obviously, when your ability to operate a motor vehicle is diminished or less than what it would be if you were totally sober, the State and the citizens of this state have an interest that you do not operate the vehicle out in public ways in that condition.
“MR. CARSTENSEN: I object, Your Honor. I don’t believe that’s the state of the law in Montana.
“THE COURT: Well, the state of the law in Montana is stated in the instructions. And the jury is cautioned not to accept what either counsel says the law is, but to take the law from the instructions.”

In addition, defendant alleges that a statement made by Officer Moe in the video tape contained a reference that defendant’s alcohol breath test was over the legal limit.

We have previously stated that when counsel opposes the admission of evidence and the District Court sustains counsel’s objection, strikes the evidence from the record, and instructs the jury to disregard the evidence, the error that is committed is presumed cured. State v. Staat (Mont. 1991), [248 Mont. 291,] 822 P.2d 643, 648, 48 St.Rep 1041, 1044 (Staat II). The District Court sustained defendant’ s objections relating to any possible references to presumptions of intoxication and admonished the jury. The District Court also gave the following jury instruction which read, in part:
“If the defendant has an alcohol concentration in his blood of 0.10 or more at the time of the alleged offense, you are permitted, but not required to infer that he was under the influence of alcohol. It is your exclusive provence to determine whether the facts and circumstances shown by the evidence warrant the inference to be drawn by you.” In Leverette, 799 P.2d at 125, we held that:
“The solution to the due process problems of using presumptions in jury charges is not, as was attempted in this case, to make them burden-of-production shifting presumptions. The solution is to make the presumptions unambiguously permissive.”

The above instruction is consistent with our holding in Leverette that presumptions or inferences must be “unambiguously permissive.” We hold that any error made by the State’s references relating to the presumption of alcohol was cured by the District Court’s admonishment of the jury and the reading of the above instruction.

With regard to the statement Officer Moe made in the video tape referring to defendant’s breath exceeding the legal limit, there was no objection made to the playing of the video in front of the jury. “Failure to make a timely objection during trial constitutes a waiver of the objection....” Section 46-20-104, MCA(1989). We hold that there was no error in admitting the video tape.

V

Whether the Justice Court had original jurisdiction because the penalty imposed for a DUI conviction exceeds the definition of a misdemeanor.

Defendant argues that because he was fined $300, assessed costs, given a six month suspended sentence, and was required to attend an alcohol treatment program which has no particular time limit, his potential sentence could exceed one year.

The penalty for a second conviction for driving under the influence of alcohol or drugs requires “a fine of not less than $300 or more than $500 and by imprisonment for not less than 7 days, at least 48 hours of which must be served consecutively, or more than 6 months.” In addition to the incarceration and fine, § 61-8-714(4), MCA (1989), requires in part:

“[T]he defendant shall complete an alcohol information course at an alcohol treatment program approved by the department of institutions, which must include alcohol or drug treatment, or both.”

The Idaho Supreme Court addressed a similar issue in State v. Pruett (Idaho 1969), 428 P.2d 43. The defendant argued that suspending the license of a person convicted of reckless driving increased the penalty for such offense beyond the jurisdiction of the Justice Court. The Court held that:

“[T]he revocation of a driver’s license is not a part of the penalty provided for violation of our statute prohibiting driving while intoxicated such that the jurisdiction of the justice court was exceeded. The conclusion therein that the deprivation of a driving right or privilege is for the protection of the public and not punishment of the individual

Pruett, 428 P.2d at 49.

The purpose of requiring attendance at an alcohol or drug treatment program is to protect the public from habitual DUI offenders. The legislature mandated rehabilitation as well as punishment in an effort to reduce the number of fatalities related to drinking and driving on Montana’s roads and highways. Requiring a DUI offender to attend an alcohol treatment program serves the purpose of protecting the public and not punishing the individual.

With regard to defendant’s allegation that paying a $300 fine and costs totalling more than $500 exceeds the maximum penalty imposed for misdemeanor offenses, Montana’s criminal code recognizes a distinction between the assessment of fines and costs. Fines are a monetary punishment imposed when an individual pleads guilty or is convicted of a criminal offense. Section 46-18-231, MCA (1989). Cost are paid by a convicted defendant to reimburse the State for expenses “specifically incurred by the prosecution in connection with the proceedings against the defendant.” Section 46-18-232(1), MCA (1989). In addition, costs are imposed only at the sole discretion of the district court judge. State v. Pease (1987), 227 Mont. 424, 434,740 P.2d 659, 665.

We hold that the imposition of a $300 fine, costs, incarceration, and treatment included in defendant’s sentence does not amount to a felony and that the Justice Court had original jurisdiction.

VI

Whether the District Court erred when it excluded jury instructions that the State must prove that the defendant acted purposely and knowingly.

Defendant based this contention on the premise that driving under the influence is a felony. For reasons discussed above, we hold that the District Court did not err in refusing jury instructions requiring the State to prove mental intent.

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


author: CHIEF JUSTICE TURNAGE

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. MICHAEL JOSEPH “MICK” JACOBSON, Defendant and Appellant.
    No. 91-468.
    Submitted on briefs January 16, 1992.
    Decided February 25, 1992.
    49 St.Rep. 178.
    252 Mont. 94.
    826 P.2d 555.
    For Appellant: Leonard J. Haxby and Christine D. Somers, Butte.
    For Respondent: Marc Racicot, Attorney General; Elizabeth L. Griffing, Assistant Attorney General, Helena; Robert M. McCarthy, County Attorney; Brad Newman, Deputy, Butte.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Michael Joseph “Mick” Jacobsen (Jacobsen) appeals a judgment of the Second Judicial District of the State of Montana, Butte-Silver Bow County, which imposed a sentence on Jacobsen greater than what was recommended in a plea-bargain agreement. We affirm.

Jacobsen presents the following issue:

Did the District Court err by imposing a sentence greater than that recommended in the plea-bargain agreement?

On April 18, 1991, Jacobsen was charged by information with two counts of burglary. By separate information on April 18, 1991, Jacobsen was charged with one count of criminal possession of dangerous drugs with intent to sell. On April 18,1991, Jacobsen pled not guilty to these charges and was released on bond pending trial.

On June 17, 1991, Jacobsen was charged by information with one count of misdemeanor assault. On June 17,1991, Jacobsen executed an acknowledgment of waiver of rights by plea of guilty and a pretrial agreement. In the pretrial agreement, Jacobsen agreed to plead guilty to one count of burglary, one count of criminal possession of dangerous drugs with intent to sell, and one count of misdemeanor assault. In turn, the State in the pretrial agreement agreed to 1) move to dismiss one burglary count and 2) recommend to the court a ten-year prison sentence with five years suspended for criminal possession of dangerous drugs with intent to sell and burglary, and six months in the county jail for the misdemeanor assault charge, these sentences to run concurrently.

At the sentencing hearing on July 12,1991 and following a review of the presentence investigation report, the District Court chose not to follow the state’s recommended sentences. Instead, the District Court sentenced Jacobsen to ten years imprisonment in Montana State Prison for criminal possession of dangerous drugs with intent to sell, ten years imprisonment in Montana State Prison for burglary and six months imprisonment in county jail for misdemeanor assault, these sentences to run concurrently. From these sentences, Jacobsen appeals.

Did the District Court err by imposing a sentence greater than that recommended in the plea-bargain agreement?

Jacobson seeks specific performance of the plea-bargain agreement. Such a remedy is not available because the District Court is not a party to the plea-bargain agreement and is not bound by its terms.

At the time Jacobsen executed the plea-bargain agreement, § 46-12-204(3)(a), MCA (1989), read as follows:

“A plea bargain agreement is an agreement between a defendant and a prosecutor that in exchange for a particular plea the prosecutor will recommend to the court a particular sentence. A judge may not participate in the making of, and is not bound by, a plea bargain agreement. If a judge does not impose a sentence recommended by a prosecutor pursuant to a plea bargain agreement, the judge is not required to allow the defendant to withdraw a plea of guilty.”

In State v. Buckman (1989), 236 Mont. 37, 42-43, 768 P.2d 1361, 1364, this Court held that because the judge is not a party to the plea-bargain agreement, the remedy of specific performance is not available. Furthermore, in Benjamin v. McCormick (1990), 243 Mont. 252, 255, 792 P.2d 7, 9, this Court, in considering whether specific performance could bind a court to comply with a plea-bargain agreement, held that “[u]nder the present law, the sentencing court was not a party to the bargain and was not subject to its terms. The enforceability of the bargain is, therefore, not an issue.”

Jacobsen further argues that because the judge stated at the end of the June 17, 1991 arraignment hearing that “[right now it looks like I’ll go along with your plea agreement^]” the judge became a party to the plea-bargain agreement. The judge’s comment, made in passing and prior to the receipt of the ordered presentence investigation report and the issuance of a final written judgment, did not indicate the judge’s unequivocal and binding acceptance of the sentence recommended in the plea-bargain agreement. When the statement is read in the context of the entire record, it becomes clear that sentencing remained conditional upon the judge’s review of the presentence investigation report. We also note that Jacobsen was made aware on two occasions that sentencing was in the sole province of the judge, once when he executed the acknowledgment of waiver of rights by plea of guilty and once verbally by the judge during the June 17, 1991 arraignment hearing. We therefore hold that the District Court committed no error when it imposed a sentence upon Jacobsen greater than that recommended in the plea-bargain agreement.

JUSTICES HARRISON, HUNT, McDONOUGH and GRAY concur.


author: JUSTICE TRIEWEILER

text:
    STATE COMPENSATION MUTUAL INSURANCE FUND, Petitioner and Respondent, v. LEE ROST LOGGING, Employer, Defendant and Appellant.
    No. 91-197.
    Submitted on briefs Nov. 8, 1991.
    Decided Jan. 28, 1992.
    As Modified on Denial of Rehearing April 2, 1992.
    49 St.Rep. 102.
    252 Mont. 97.
    827 P.2d 85.

      For Appellant: James C. Bartlett, Hash, O’Brien and Bartlett, Kalispell.
    For Respondent: Richard E. Bach, State Compensation Mutual Insurance Fund, Helena.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

Appellant Lee Rost Logging (Rost) is a logging business in Bigfork. A hearing officer for the Department of Labor and Industry determined that Rost did not have to pay workers’ compensation insurance premiums on payments made to employees reimbursing them for the use of their pickup trucks. The hearing officer also determined that Rost had made excessive payroll deductions for payments to employees which reimbursed them for the use of their chain saws. On appeal, the Workers’ Compensation Court reversed the hearing officer on the issue of pickup rentals and affirmed on the issue of saw rentals. Rost appeals from the decision of the Workers’ Compensation Court. We reverse the Workers’ Compensation Court on the issue of pickup rentals, and affirm on the issue of saw rentals.

Rost raises the following issues:

1. Did the Workers’ Compensation Court err in reversing the hearing officer’s decision on the issue of pickup rentals?

2. Should the hearing officer’s decision regarding pickup rentals be affirmed on the basis of res judicata and collateral estoppel?

3. Did the Workers’ Compensation Court err in affirming the hearing officer’s decision on the issue of saw rentals?

Appellant Lee Rost runs a small logging business out of his home in Bigfork. He has been in the logging business for more than 20 years. During 1984 and 1985, Rost had several employees working for him, including sawyers, skidders, and equipment operators. Rost’s logging operations were often in remote backwoods areas, requiring the use of four wheel drive vehicles to access the logging sites. Rost needed to transport equipment, parts, supplies, and fuel for machinery to the remote job sites, along with his workers. He had found that he suffered a considerable expense if he supplied the necessary vehicles to his employees, due to the short useful life of vehicles under such adverse driving conditions. Rost found it less expensive to reimburse his employees for using their own vehicles for travel to and from the job sites.

Like other employers in the logging industry, Rost also compensated his employees when they furnished their own chain saws. Rost paid his employees a base pay of $60 per day, plus amounts for pickup rentals and saw rentals in the range of $20 to $60 per day in each category.

Rost carried workers’ compensation insurance with respondent State Compensation Mutual Insurance Fund (State Fund). The premium for this insurance was based in part on the employer’s payroll. The employer was required to report wages, commissions, piece work payments, and other payments in money or in kind. The employer was not required to report travel allowances made to reimburse employees for their expenses. The payroll report instructions also provided that the employer was to report only 75 percent of the total remuneration paid to an employee furnishing his own chain saw.

In September 1985, the Department of Labor and Industry informed Rost that it would be auditing his unemployment insurance and workers’ compensation insurance accounts for periods during 1984 and 1985. The audit was performed in early 1986. The auditor reviewed Rost’s payroll records, and the amounts listed as wages, pickup rentals, and saw rentals. The auditor felt that Rost had insufficient documentation that the payments for pickup rentals were related to the employees’ actual expenses. The auditor also felt that Rost had excluded from his payroll excessive amounts of saw rental payments. The auditor concluded that Rost owed $30,616 in premiums for workers’ compensation insurance.

In June 1986, Rost requested an administrative review of the audit. Rost attempted to supply documentation for the pickup rental amounts by calculating the mileage driven by different employees and multiplying the mileage by $0.21 per mile, the reimbursement allowed at that time by the Unemployment and Workers’ Compensation Divisions. However, because these records were prepared after the audit, the reviewing administrator was unwilling to reduce the assessed premium.

Rost then sought a hearing before the Department of Labor and Industry. This hearing was delayed, and then postponed several times at Rost’s request. At the same time, Rost was also appealing from the additional assessment claimed by the Unemployment Insurance Division, based upon the same payroll audit. Rost requested the two Divisions to coordinate their appeal procedures.

On September 29, 1987, the hearing officer in the unemployment insurance case ruled that Rost was not allowed to deduct payments for pickup rentals from reportable wages. Rost appealed this decision to the Board of Labor Appeals. The Board of Labor Appeals reversed and determined that the pickup rentals represented a reasonable reimbursement for the mileage driven by Rost’s employees. The Board of Labor Appeals further determined that Rost had relied in good faith on a 1980 decision of the Eleventh Judicial District Court, Flathead County, which had ruled on a similar issue in favor of an employer and against a workers’ compensation insurer. The Board of Labor Appeals concluded that Rost’s payments for pickup rentals were not “wages” subject to unemployment insurance premiums.

Rost’s contested case in the workers’ compensation insurance matter was still pending. The hearing was finally held on July 17, 1990. The hearing officer found that the vehicle payments to Rost’s employees were based upon Rost’s personal review of the routes to the logging sites, including the actual mileage and quality of the roads. The hearing officer also found that the reimbursed travel was for the benefit of the employer because the workers transported tools, spare parts to repair the equipment, fuel for various machines, and other supplies. The hearing officer determined that these travel expenses generally were within the guideline of $0.21 per mile, and constituted a reasonable reimbursement for employment-related expenses. He found no evidence of cheating or misrepresentation. The hearing officer noted that Rost had won a favorable decision in his appeal of the unemployment insurance matter, and agreed with the Board of Labor Appeals that Rost had relied in good faith on the earlier decision of the Eleventh Judicial District Court. The hearing officer concluded that Rost had provided sufficient documentation of these travel expenses, and that the pickup rental payments were properly excluded from gross wages in determining the workers’ compensation premiums.

The hearing officer also concluded that Rost was entitled to deduct 25 percent of gross payroll for sawyers as a business expense where the employees furnished their own chain saws. Although the Workers’ Compensation Court had ruled in June 1989 that an injured sawyer was entitled to workers’ compensation benefits based on his gross earnings, without the 25 percent deduction for saw rentals, see Guckenberg v. Bill Free Logging, Inc. (Work.Com.Ct. 1989), No. 8808-4883, the hearing officer noted that in 1984 and 1985 the State Fund had allowed the 25 percent deduction to other employers. However, the hearing officer found that Rost had exceeded the 25 percent allowable deduction for saw rentals in certain instances and that Rost should be assessed premiums on that excess.

The hearing officer accordingly reversed the auditor’s findings on the issue of pickup rentals, concluding that no additional premiums were owed. On the issue of saw rentals, the hearing officer ordered Rost to pay additional premiums because of excessive saw rental deductions.

Rost and the State Fund both appealed the hearing officer’s decision to the Workers’ Compensation Court. The Workers’ Compensation Court disagreed with the hearing officer on the issue of travel expenses. The court did not feel that Rost had adequately demonstrated that the pickup rental payments were related to actual expenses. The court found that the hearing officer’s findings on this issue were not supported by substantial evidence, and reversed. The Workers’ Compensation Court agreed with the hearing officer on the saw rentals issue. The court affirmed the hearing officer’s determination that 25 percent of the gross payroll for sawyers should be deducted from wages and considered a business expense.

Lee Rost Logging appeals from the decision of the Workers’ Compensation Court.

I

Did the Workers’ Compensation Court err in reversing the hearing officer’s decision on the issue of pickup rentals?

Rost contends that the Workers’ Compensation Court erred in reversing the hearing officer’s decision on the issue of pickup rentals. We agree.

The hearing officer determined that pickup rental payments constituted a reasonable reimbursement for employment-related expenses. The Workers’ Compensation Court ruled that this finding was not supported by substantial evidence, and reversed on this basis. See 2-4-704(2)(a)(v), MCA, which provides that a reviewing court may reverse an agency’s decision if it is “clearly erroneous in view of the reliable, probative, and substantial evidence on the whole record. “This Court recently explained the application of the “clearly erroneous” test in the context of reviewing the findings of a trial court sitting without a jury:

We adopt the following three-part test to determine if a finding is clearly erroneous. First, the Court will review the record to see if the findings are supported by substantial evidence. Second, if the findings are supported by substantial evidence, we will determine if the trial court has misapprehended the effect of evidence. Western Cottonoil v. Hodges (C.A. 5th 1954), 218 F.2d 158; Narragansett Improvement Company v. United States ([1st Cir.] 1961), 290 F.2d 577. Third, if substantial evidence exists and the effect of the evidence has not been misapprehended, the Court may still find that “[A] finding is ‘clearly erroneous’ when, although there is evidence to support it, a review of the record leaves the comb with the definite and firm conviction that a mistake has been committed.’” Ufnited]S[tates] v. U.S. Gypsum Co. (1948), 68 S.Ct. 525, 333 U.S. 364, 92 L.Ed. 746.

Interstate Production Credit Ass’n. v. DeSaye (Mont. 1991), [250 Mont. 320,] 820 P.2d 1285, 48 St.Rep. 986, 987.

To the extent that our discussion of the standard for reviewing agencies’ findings of fact in City of Billings v. Billings Firefighters (1982), 200 Mont. 421, 651 P.2d 627, is inconsistent with the standard set forth above, that case is overruled. Applying this test to the hearing officer’s findings on the issue of pickup rental payments, we conclude that the findings were not clearly erroneous.

Rost and several of his employees testified before the hearing officer on July 17,1990. The employees testified that they had to drive many miles, often more than 100 miles per day, over rough logging roads to reach the job sites. In addition to expenditures for gasoline and normal highway wear and tear, the workers testified that they had extra expenses for servicing their vehicles and replacing parts worn out from traveling on bumpy roads in dusty, muddy, and snowy conditions. Rost’s employees testified that they carried extra saws, tools, equipment, spare parts, and fuel to the job sites for their employer. The heavy equipment operators, in particular, brought extra fuel, as much as 100 gallons of gasoline, and everything they would need to keep Rost’s equipment running.

Rost testified that it was to his benefit to pay his workers for the use of their vehicles because it would have cost him more to furnish his own trucks. In the past, he had purchased his own vehicles for the logging operation, and found it was too expensive. Rost testified that when he bid a job he considered the costs of getting materials to and from the job site, the quality and condition of the roads, and mileage. He drove all of the roads and considered what it would cost his employees to travel to the job sites. He paid certain employees more if they had to haul more materials to the job. Rost stated that he included more in his calculations than just the mileage traveled, although mileage was one of the factors considered.

Rost’s employees testified that the money they received for the use of their pickup trucks was about equal to what it cost them to provide the vehicles.

Based on this and other evidence, the hearing officer made his findings of fact. The hearing officer noted that the pickup rental payments were based upon Rost’s personal review of the job sites and bis experience in determining vehicle costs. The hearing officer found that these travel expenses were incurred for the employer’s benefit. The hearing officer found that the travel expenses generally were within the $0.21 per mile guideline set by the state, and were a reasonable approximation of actual expenses. The hearing officer concluded from these facts that Rost had paid reasonable reimbursement to his employees for employment-related expenses, and that these payments were properly excluded from gross wages in determining the workers’ compensation insurance premiums.

We conclude, based on the standard of review set forth above, that the hearing officer’s factual findings on this issue were not clearly erroneous.

II

Should the hearing officer’s decision regarding pickup rentals be affirmed on the basis of res judicata and collateral estoppel?

Because we conclude that the hearing officer’s decision regarding pickup rentals was not clearly erroneous, we need not consider the application of res judicata or collateral estoppel.

III

Did the Workers’ Compensation Court err in affirming the hearing officer’s decision on the issue of saw rentals?

The hearing officer determined that Rost had deducted excessive amounts from gross payroll for saw rentals. Rost contends the Workers’ Compensation Court erred in affirming this determination. We disagree.

At the time of the audit, the State Fund allowed employers in the logging industry to deduct from gross payroll 25 percent of the total remuneration paid to employees who furnished their own chain saws. Although this practice was discontinued following the June 1989 decision of the Workers’ Compensation Court in Guckenberg, the hearing officer determined that Rost was entitled to take the deduction as other employers had in 1984 and 1985. The hearing officer determined, however, that Rost had deducted more than 25 percent of the sawyers’ pay.

Rost contends that there was insufficient evidence to support this finding, and complains that it has taken too long for the State Fund to determine exactly how much he owes in underpaid premiums. These contentions are not persuasive.

The evidence before the hearing officer included Rost’s payroll reports, the auditor’s payroll calculations, and testimony at the hearing and at Rost’s deposition. Rost had recorded in one notebook the bimonthly wages and withholdings for each employee, and in a separate notebook the saw and pickup allowances paid to each employee during the same periods. Each employee’s wages, pickup rentals, and saw rentals can be added together; 25 percent of this total represents the allowable deduction for saw rentals. It is clear from a review of the payroll records that the saw rental payments, in several instances, exceeded 25 percent of gross pay. The hearing officer noted that Rost had paid some employees more as “saw rental” than as “wages” in certain payroll periods. The hearing officer specifically cited the 1985 records as exemplifying this problem. There was sufficient evidence to support the hearing officer’s findings.

Regarding Rost’s claim that it has taken too long to determine exactly how much he owes in underpaid premiums, we note that much of the delay in reaching a final determination on this question is due to the challenges Rost has raised to the State Fund’s original calculation of the premium owed. We note that Rost, on several occasions, requested a delay in these proceedings. Rost has not been prejudiced by the delay.

Since we conclude that there was sufficient evidence to support the hearing officer’s findings as to both the saw rentals and the pickup rentals, we affirm the Workers’ Compensation Court on the issue of saw rentals, we reverse the Workers’ Compensation Court on the issue of pickup rentals, and we remand this matter to the Workers’ Compensation Court for further proceedings consistent with this opinion.

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

ORDER ON REHEARING

This Court’s opinion was delivered on January 28, 1992. On February 3, 1992, the appellant petitioned for rehearing and requested that this Court’s opinion be amended by excluding pickup rentals from the formula suggested on page 11 [page 89] [Mont. p. 104, para. 3, line 6] of the opinion for calculating saw rental deductions.

On February 6, 1992, the respondent filed its petition for rehearing, and among other bases for its petition, requested the same modification at page 11 of our opinion. Since that date, the appellant has withdrawn his petition and objected to the respondent’s petition.

After reviewing the opinion of the hearing examiner for the Department of Labor and Industry, which was affirmed by this Court’s opinion, and the payroll report instruction sheet provided by the State Fund to the appellant, which was the basis for the hearing examiners opinion, we conclude that there is merit in the respondent’s petition.

The general reporting requirements provide that a travel allowance need not be reported as earnings. They then provide that only 75 percent of the “total remuneration” need be reported for an employee who furnishes his own chain saw. It would be inconsistent to exclude travel allowances from the earning that need be reported, but then to include those payments in calculation of the chain saw allowance.

For these reasons, this Court’s previous opinion of January 28, 1992, is amended as follows:

The words “pickup rentals” are deleted from line 7 from the bottom of page 11 [line 7 on page 89] [Mont, page 104, line 4 from bottom].

Except to the extent provided for in the preceding paragraph, the respondent’s petition for rehearing is denied.

The clerk shall mail true and correct copies of this order to all counsel of record and to Timothy W. Reardon, Judge of the Workers’ Compensation Court.


author: JUSTICE HARRISON

text:
    HERBERT SHELLEY, Claimant and Appellant, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, FIDELITY and GUARANTY LIFE INSURANCE COMPANY, VALLEY CHIROPRACTIC CENTER, DR. JOHN E. FRANCIS, Defendants and Respondents.
    No. 91-521.
    Submitted on Briefs February 20, 1992.
    Decided April 2, 1992.
    49 St.Rep. 277.
    252 Mont. 106.
    827 P.2d 1288.

      For Appellant: Herbert Shelley, Pro Se, Bigfork.
    For Respondents: Robert Sheridan, Garlington, Lohn & Robinson, Missoula.
   JUSTICE HARRISON

delivered the Opinion of the Court.

Herbert Shelley (Shelley) appeals from the judgment of the Workers’ Compensation Court which dismissed his appeal based on a failure to timely file.

The issue is whether the Workers’ Compensation Corut erred when it determined that it lacked jurisdiction over the matter based on failure to timely file an appeal. We reverse.

Shelley, after being injured in 1986, was treated by a chiropractor, Dr. John E. Francis (Francis) during 1989 and 1990. On June 4,1990, respondent United States Fidelity & Guaranty (USF&G) denied payment for the services rendered by Francis for reasons not the subject of this appeal. On November, 16,1990, after a hearing on the matter, Gordon Bruce (Bruce), a Hearing Examiner for the Department of Labor and Industry, determined that Francis was not entitled to payment for treating Shelley and dismissed the action. In rendering his decision, Bruce informed appellant of the appeal deadline in his Findings of Fact and Conclusions of Law as follows:

Notice: This order is signed by the Hearing Examiner of the Department of Labor and Industry under authority delegated by the Commissioner. Any party in interest may appeal this order to the Workers’ Compensation court within Thirty (30) working days after the date of mailing of this final order as provided in Section 24.29.207(7) and 24.29.215(3) ARM. [Emphasis added.]

Shelley wrote the Workers’ Compensation Court to initiate the appeal process on December 26,1990. USF&G insists that Shelley’s option to appeal expired December 19,1990, thirty days from the date of the mailing of the final order according to 24.29.215, A.R.M., not thirty working days as stated by Bruce in the above quote. Accordingly, USF&G opposed the appeal on the grounds of untimely filing. The Workers’ Compensation Court granted USF&G’s motion for dismissal on August 28,1991. Shelley appeals to this Court.

This appeal centers around one important point: the error of the Department of Labor and Industry. We previously addressed an error of similar nature in Mellem v. Kalispell Laundry (1989), 237 Mont. 439, 774 P.2d 390. In Mellem, the Division of Workers’ Compensation (now an entity renamed under the Department of Labor and Industry, hereinafter referred to as the Department), misinformed a claimant of her appeal rights and procedures. We held that the doctrine of equitable estoppel prohibited the Department from denying her appeal based on failure to comply with filing requirements. Mellem, 237 Mont, at 442, 774 P.2d at 391. In essence, we extended the doctrine of equitable estoppel to cover situations involving misrepresentations made by the Department.

[W]e have held in similar situations under the statute of limitations in the Workers’ Compensation Act that where misstatements by an employer or insurer prevent a claimant from filing a Workers’ Compensation claim in a timely fashion, or mislead the claimant into believing that no claim can or need be filed, the doctrine of equitable estoppel applies to toll the limitation period and allow filing of the claim. Davis v. Jones (1983), 203 Mont. 464, 661 P.2d 859. The doctrine is equally applicable to the facts in this case, as is the maxim “No one can take advantage of his own wrong.” Section 1-3-208, MCA.

Mellem, 237 Mont. at 442, 774 P.2d at 391-92. We reversed the Workers’ Compensation Court with instructions to grant the claimant’s appeal in Mellem. Accordingly, we arrive at the same conclusion in the case at bar under the doctrine of equitable estoppel. Equitable estoppel contains six elements:

1. There must be conduct — acts, language, or silence — amounting to a representation or a concealment of material facts. 2. These facts must be known to the party estopped at the time of his said conduct, or at least the circumstances must be such that knowledge of them is necessarily imputed to him. 3. The truth concerning these facts must be unknown to the other party claiming the benefit of the estoppel, at the time when it was acted upon by him. 4. The conduct must be done with the intention, or at least with the expectation, that it will be acted upon by the other party, or under such circumstances that it is both natural and probable that it will be so acted upon ... 5. The conduct must be relied upon by the other party, and, thus relying, he must be led to act upon it. 6. He must in fact act upon it in such a manner as to change his position for the worse ... Davis, 661 P.2d at 861 (quoting Lindbolm v. Employers’ Liability Assurance Corp. (1930), 88 Mont. 488, 494, 295 P. 1007, 1009).

Mellem, 237 Mont. at 442, 774 P.2d at 392.

In the case at bar, Shelley received, by mail, the Hearing Examiner’s findings of fact and conclusions of law on November 19, 1990, three days after they were signed and dated November 16, 1990. Shelley appealed to the Workers’ Compensation Court on December 26, 1990, within the thirty working day time-frame. USF&G asserts that Shelley’s appeal right expired on December 19, 1990. We disagree and conclude that the six elements of equitable estoppel are present. The Department is estopped from claiming that Shelley’s appeal was untimely since the Department misinformed him regarding the appeal time-frame.

It is also apparent from the Administrative Rules of Montana dealing with the Office of Workers’ Compensation Judge, that there is authority to grant exceptions for noncompliance. Section 24.5.350 (2), A.R.M. states that “Service deadlines for filing an appeal are as follows ...(c) from all other proceedings within thirty days of service of the final order of the department of labor and industry.” The section immediately preceding reads:

[T]he court may, in its discretion and in the interests of justice, waive irregularities and noncompliance with any of the provisions of this subchapter.

24.5.349, A.R.M.

We conclude that a failure to timely file an appeal is noncompliance within the context of 24.5.349, A.R.M., and therefore, an extension of time for appeal is properly entertained by the Workers’ Compensation Judge. This is particularly true in the case at bar since the Hearing Examiner misinformed the claimant and led him to believe that he had thirty working days to file an appeal. In view of the circumstances, the court cannot now claim that Shelley’s appeal is untimely when the Department itself is the reason for Mr. Shelley’s untimeliness. We conclude that the Workers’ Compensation Court could have corrected the error via its discretionary powers.

Additionally, we point out that the Workers’ Compensation Court, in dismissing Shelley’s appeal, stated that it strictly enforces appeal deadlines and that “no authority exists whatsoever which provides for an appeal to the Workers’ Compensation Court to be filed within 30 working days from the Division’s notice of final order.” (Emphasis in original.) The court further said that “[t]here is no good faith exception to the mandatory 30-day appeal period ....” However, a recent opinion from the Workers’ Compensation Court indicates that the court does recognize exceptions. McColley v. Laborers’ Local 98 & State Comp. Fund (1990), WCC No. 9001-5699, Vol. XI No. 770. In McColley, the court said:

The [Workers’ Compensation] Court recognizes the requirement of the filing deadline and its importance and that exceptions must be carefully considered.

McColley, Vol. XI No. 770, pg 2. In McColley, there was confusion over when the claimant’s letter of appeal actually reached the Workers’ Compensation Court. Under those circumstances the court refused to dismiss the appeal as untimely.

Absent an abuse of discretion, a discretionary ruling will not be overturned. Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 475, 803 P.2d 601, 603-604. Under the facts in the case at bar, we hold that the Workers’ Compensation Court abused its discretion when it dismissed Shelley’s appeal for lack of jurisdiction based on an untimely appeal. Accordingly, we remand to the Workers’ Compensation Court with instructions to hear the matter as a proper and timely appeal. Reversed.

JUSTICES GRAY, HUNT, TRIEWEILER and McDONOUGH concur.