author: CHIEF JUSTICE TURNAGE

text:
    LEO DAVID McCULLUGH, Petitioner and Appellant, v. STATE OF MONTANA, Respondent and Respondent.
    No. 92-566.
    Submitted on Briefs June 17, 1993.
    Decided July 20, 1993.
    50 St.Rep. 854.
    259 Mont. 406.
    856 P.2d 958.

      For Petitioner and Appellant: James A. Manley, Manley Law Offices, Poison.
    For Respondent: Joseph P. Mazurek, Attorney General, Carol E. Schmidt, Assistant Attorney General, Helena, Larry J. Nistler, County Attorney, and Robert J. Long, Deputy County Attorney, Poison.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Leo David McCullugh appeals from an order entered by the District Court for the Twentieth Judicial District, Lake County. The court denied McCullugh’s petition to vacate an order suspending his driver’s license pursuant to § 61-8-402, MCA. We affirm.

The issue is whether the District Court erred in ruling that the arresting officer had probable cause to arrest McCullugh for driving or being in actual physical control of a vehicle while under the influence of alcohol.

On August 21,1992, at approximately 6 a.m., Lake County Deputy Sheriff Edward Todd observed a truck off the road on old Highway 93 south of Pablo, Montana. The front end of the truck was in the ditch and the rear end was up on the road a little bit. Todd observed McCullugh jacking up the back end of the truck.

After talking to McCullugh, Todd concluded that he was under the influence of alcohol, placed him in the back of his patrol car, and called for assistance from a highway patrol officer. The highway patrol officer checked McCullugh’s eyes for nystagmus, noted that his balance was unsteady, and detected a strong odor of alcohol on his breath. He arrested McCullugh for driving under the influence of alcohol.

McCullugh refused to take a breath test. As a result, his driver’s license was suspended pursuant to § 61-8-402, MCA. We note that this action under the implied consent law is separate from any DUI prosecution arising out of these events.

McCullugh appealed the suspension of his driver’s license to District Court, arguing that the highway patrol officer did not have reasonable grounds to believe that he had been driving or was in actual control of a vehicle while under the influence of alcohol. After a hearing, the District Court denied the petition to vacate the suspension of McCullugh’s driver’s license.

Did the District Court err in ruling that the arresting officer had probable cause to arrest McCullugh for driving or being in actual physical control of a vehicle while under the influence of alcohol?

Section 61-8-403, MCA, provides that, in a petition for review of the revocation of a driver’s license for failure to submit to a blood, breath, or urine test,

the issues shall be limited to whether a peace officer had reasonable grounds to believe the person had been driving or was in actual physical control of a vehicle upon ways of this state open to the public, while under the influence of alcohol, drugs, or a combination of the two, whether the person was placed under arrest, and whether such person refused to submit to the test.

McCullugh contests only the first of these three issues, whether the arresting officer had reasonable grounds to believe he was in actual physical control of his truck upon a public highway while under the influence of alcohol.

“Reasonable grounds” as used in § 61-8-403, MCA, is synonymous with “probable cause.” Boland v. State (1990), 242 Mont. 520, 524, 792 P.2d 1, 3.

The probable cause requirement is satisfied at the time of arrest if the facts and circumstances within the officer’s personal knowledge, or upon information imparted to him by a reliable source, are sufficient to warrant a reasonable person to believe that the suspect has committed an offense.

State v. Lee (1988), 232 Mont. 105, 109, 754 P2d 512, 515.

At the hearing before the District Court, McCullugh testified that his truck became stuck in the ditch hours before Deputy Todd observed him there. McCullugh testified to the following chronology of events: Angry with his wife, he left home a little after 2 a.m. to spend the night at a friend’s house. While he was driving to the friend’s house, his brakes went out. He turned the truck into the ditch, planning on leaving it there until he could get the brakes fixed. He had not been drinking alcohol up to this point. He then walked to his friend’s house in Pablo, where the friend invited him to drink some Black Velvet and to stay for the night. After drinking about half of a fifth of Black Velvet, McCullugh became concerned that the back end of his truck was in the road. He walked back to the vehicle about 6 a.m. to push the back end of the truck off the road. When he was arrested, he did not realize that he did not even have the keys to the truck with him, having left them on his friend’s kitchen counter.

McCullugh asserts that the arresting officers should have ascertained whether he had the keys to the truck with him when they arrested him. He also maintains they should have checked the hood of the truck to see if it was warm and should have questioned him as to when he had been driving, when he had been drinking, or whether he had been drinking prior to driving.

At the hearing on McCullugh’s petition to vacate the suspension of his driver’s license, the highway patrolman testified:

A. I was called out roughly 20 after 6:00 or so and was advised that Ed had run across a wreck on Old Highway 93 just south of Pablo. When I got there, I talked to Ed for a little bit and noted there was a pickup, as Ed stated earlier, nosed into the borrow pit with the tail end sticking out a little bit and there was a jack, it appeared that someone was jacking it up, and the driver, Mr. McCullugh, was in the back of Deputy Todd’s patrol car. I asked Ed about everything, what had took place, if he talked to the driver. He said momentarily, but he said there obviously was alcohol involved, you could smell it on the driver, and he thought there might be some damage to the vehicle, which there wasn’t. I found no damage to the pickup at all. I then went and had the driver get out and questioned him.
Q. Okay. Did you question him regarding whether he had been driving?
A. Yes, I did.
Q. And what was the substance of that conversation?
A. He stated he was coming into Pablo from the south, lost his brakes and went into the borrow pit.
Q. Okay. Did he indicate whether he had just done that or whether that was three hours prior to your arriving?
A. From what he told me, it was within an hour, so about a quarter to 6:00 or so.
Q. Okay. Did he ever make any statements about having been over at Mr. Mather’s house?
A. No, he didn’t. However, he stated that that’s where he was going to.
Q. Okay. Did he ever — well, did you ask him about whether he had been drinking?
A. Yes. I asked him if he had had anything to drink and he stated that he had about a case of beer.

The defense points out that, in his written report, the highway patrolman did not write that McCullugh was driving within a hour of when he was arrested. It also cites the following testimony of the highway patrolman on cross-examination:

Q. Now, Patrolman Roth, let me ask you about your testimony here a moment ago. Mr. Long asked you if Mr. McCullugh had made any statements about when he had been driving into Pablo, and I believe that your testimony was that from what you understood or from what you got, it had been within an hour?
A. That’s the conversation I had with Mr. McCullugh as we were driving into Poison.

The defense points out that, as they were driving into Poison, McCullugh was already under arrest and that statements made after arrest cannot be used to support a determination of probable cause.

Because of the question as to when McCullugh made the statement that he had been driving within an hour of his arrest, we do not consider that statement in determining whether there was probable cause for arrest. It does not appear that the District Court relied upon that statement, either. At the end of the hearing, the District Court stated:

Both the deputy sheriff and the highway patrolman came on the scene. Here’s a single occupant or a single person in control of this vehicle, he obviously had been drinking, it had run into the ditch. There was no reason for them to look for keys or try to ascertain whether the drinking had happened sometime after the accident. ... [T]he petition is denied.

The highway patrolman’s testimony demonstrates that Deputy Todd indicated to him that McCullugh was the driver of the truck. When he was arrested, McCullugh did not tell the law enforcement officers his story concerning the delay between his driving and his drinking. He would have this Court put the burden on the officers to elicit the information from him that he had “parked” his truck in the ditch, left the truck and ingested the Black Velvet, and then, several hours later, returned to the truck. He also asks us to put the burden on the officers to make sure that he had the keys to the truck in his possession at the time of his arrest. As the State points out, such a requirement would encourage persons in such situations to “lose” their keys.

McCullugh’s story is not the first or most natural conclusion a reasonable person would reach after observing a man obviously under the influence of alcohol trying to move a vehicle stuck on the side of the road. At the time of his arrest, McCullugh did not offer the officers the explanation he now gives. We conclude that the information available to the officers at the time of McCullugh’s arrest was sufficient to warrant a reasonable person to believe that McCullugh was in physical control of the truck.

We affirm the ruling of the District Court.

JUSTICES HARRISON, TRIEWEILER, NELSON and WEBER concur.


source: Caselaw Access Project

author: JUSTICE HARRISON JUSTICE TRIEWEILER

license: Public Domain

text:
    ROBERT WESTLAND and WESTLAND RANCH, INC., a Montana corporation, Plaintiffs and Appellants, v. GERALD WEINMEISTER and UNITED GRAIN CORPORATION, Defendants and Respondents.
    No. 93-047.
    Submitted on Briefs June 10, 1993.
    Decided July 20, 1993.
    50 St.Rep. 857.
    259 Mont. 412.
    856 P.2d 1374.

      For Plaintiffs and Appellants: Robert Hurly, Glasgow, and Peter O. Maltese, Sidney.
    For Defendants and Respondents: K. Dale Sehwanke, Jardine, Stephenson, Blewett & Weaver, Great Falls.
   JUSTICE HARRISON

delivered the Opinion of the Court.

Robert Westland and Westland Ranch, Inc., appeal from an order of the Fifteenth Judicial District Court, Roosevelt County, dismissing their claims for failure to prosecute. We affirm.

In May 1985, appellants (Westland) delivered approximately 17,000 bushels of wheat to an elevator operated by United Grain Company at Macon, near Wolf Point, Montana. Elevator personnel issued scale tickets showing a net delivery of 16,236 bushels and mixed Westland’s wheat with other wheat for shipment and sale. As the parties did not agree on the grade and price of Westland’s wheat, the elevator continued to credit 16,236 bushels to Westland. Westland was billed periodically for storage costs.

On February 17, 1987, Westland filed this action against United Grain Company and its manager, Gerald Weinmeister (collectively, United Grain), complaining that United Grain had willfully converted its wheat and requesting judgment for actual, compensatory, and punitive damages. United Grain admitted commingling and selling Westland’s wheat but denied that it was required to store it separately or to redeliver it to Westland on demand. It counterclaimed for Westland’s unpaid freight and storage charges.

Westland served interrogatories in February 1987; United Grain responded in April. United Grain served interrogatories in May 1988; Westland responded in June. No further discovery was undertaken until October 1990.

The District Court conducted a scheduling conference by telephone on May 2, 1989. The parties agreed to complete discovery by August 11, 1989; this deadline was extended to November 1989 on United Grain’s motion. On November 22, 1989, United Grain moved to extend the deadline another 120 days. The court issued an order on December 5, 1989, extending the discovery deadline “indefinitely.” Westland wrote letters to the court concurring in both extensions.

In October 1990, United Grain deposed several witnesses, including appellant Robert Westland. Westland deposed respondent Weinmeister in February 1991. Westland took no further action in this case until United Grain moved to dismiss the complaint in 1992.

On June 12, 1992, United Grain moved to dismiss Westland’s complaint for failure to prosecute, pursuant to Rule 41(b), M.R.Civ.P. Westland did not file a formal response, but on August 6, 1992, its lawyer telephoned Judge Sorte to ask for an extension of time to respond, until August 21,1992. Judge Sorte apparently agreed to this extension. Nevertheless, he entered an order dismissing the complaint on August 13, 1992. Westland wrote to the judge reminding him that he had granted an extension, and on August 21,1992 it filed its brief responding to United Grain’s motion to dismiss.

On September 8,1992, the District Court vacated its order dismissing the complaint, saying that it had issued that order “inadvertently and by mistake.” United Grain’s motion to dismiss was denied, and Westland was ordered to arrange a pre-trial scheduling conference as soon as possible.

Two days later, United Grain filed its response to Westland’s August 21 brief, and on September 25, 1992, the District Court reinstated its judgment of dismissal, announcing that “the court now being fully advised has determined that its initial decision to dismiss [Westland’s] complaint and claims and to enter final judgment was correct.” Westland appealed.

The sole issue on appeal is whether the District Court abused its discretion in dismissing Westland’s complaint for failure to prosecute.

Rule 41(b), M.R.Civ.P, authorizes a district court to dismiss an action for failure to prosecute. It provides in pertinent part:

For failure of the plaintiff to prosecute ... a defendant may move for dismissal of an action or of any claim against the defendant.... Unless the court in its order for dismissal otherwise specifies, a dismissal under this subdivision ... operates as an adjudication upon the merits.

A district court has broad discretion in determining whether to dismiss, and its decision will be overturned only if it has abused that discretion. Shackleton v. Neil (1983), 207 Mont. 96, 101, 672 P.2d 1112, 1115; Thomas v. Wilson (1989), 236 Mont. 33, 35, 767 P.2d 1343, 1344.

In deciding whether a district court has abused its discretion in dismissing an action for failure to prosecute, we consider the following four factors:

1) the plaintiff’s diligence in prosecuting his claims; 2) the prejudice to the defense caused by the plaintiff’s delay; 3) the availability of alternate sanctions; and 4) the existence of a warning to plaintiff that his case is in danger of dismissal.

Becky v. Norwest Bank Dillon, N.A. (1990), 245 Mont. 1, 8, 798 P.2d 1011, 1015. We consider these factors in light of public policy considerations that favor a plaintiff’s right to a hearing on the merits, balanced against the trial court’s need to manage its docket and the general policy of encouraging prompt disposition of lawsuits. Becky, 798 P.2d at 1015.

First, the party moving for dismissal must demonstrate that the plaintiff has unreasonably delayed prosecution of his claim. Becky, 798 P.2d at 1015. An unreasonable delay raises a presumption of prejudice to the defendant and shifts the burden to the plaintiff to show good cause or a reasonable excuse for his inaction. Shackleton, 672 P.2d at 1115.

Here, Westland attempts to justify the delay by listing several occasions on which United Grain moved for an extension of time. United Grain postponed deadlines for responding to interrogatories three times in 1987 and in 1989 moved twice to extend discovery deadlines. It also rescheduled depositions on two occasions in 1990.

Westland also cites United Grain’s failure to provide information requested in February 1991, during depositions. Westland asked United Grain to document wheat samples it had submitted to the State Grain Laboratory and to provide information as to whether the train loads of wheat in which Westland’s wheat had been included were docked for quality. United Grain never provided this information.

The District Court concluded that five years (1987-92) is an unreasonably long time in which to bring as simple a case as this one to trial, and that Westland had not offered a reasonable justification or excuse for this delay. We agree.

All of the delays Westland attributed to United Grain, together, account for only a few months out of the five years that elapsed between the filing of the complaint and United Grain’s motion to dismiss. Moreover, Westland consented to all of United Grain’s requests for extension. Thus, apart from its February 1991 deposition of respondent Weinmeister, Westland did nothing to bring this case to trial between May 1987, when it answered United Grain’s counterclaim, and August 1992, when it responded to United Grain’s motion to dismiss.

As for the information United Grain failed to provide, Westland itself contributed to this delay by failing to answer United Grain’s letter of February 22, 1991, in which United Grain asked Westland to confirm the precise information requested. Nor did Westland follow up with United Grain to obtain the information, or move the court to compel production of documents, during the sixteen months that elapsed between the time of its request and United Grain’s motion to dismiss.

We conclude that the District Court did not abuse its discretion in determining that Westland had no reasonable justification or excuse for its failure to prosecute this case between 1987 and 1992.

As for the second Becky factor, prejudice to the defense, the District Court concluded correctly that United Grain was presumptively prejudiced by the unexcused delay and therefore was not required to demonstrate that its ability to defend was impaired. Becky, 798 P.2d at 1016.

Westland urges us to remand this case for trial because the District Court did not consider the third Becky factor, availability of an alternate sanction. Westland relies on Doug Johns Real Estate, Inc. v. Banta (1990), 246 Mont. 295, 805 P.2d 1301, in which we stated as a general rule that courts should refrain from dismissing an action “unless there is no other adequate remedy available and the facts adequately call for such a result.” Doug Johns, 805 P.2d at 1303.

In Doug Johns the district court dismissed a real estate broker’s attempt to collect a commission for failure to prosecute, because the broker “did nothing after filing his complaint” and did not even serve the defendants until seven months after filing the action. We reversed, based on letters in the record that appeared to substantiate the broker’s contention that the parties had attempted to negotiate a settlement during the seven months. We held that another adequate remedy was available: the district court could have scheduled the case for trial under Rule 16(b)(4), M.R.Civ.P.

Here, no evidence of negotiation appears in the record, nor has either party argued, as the broker did in Doug Johns, that prosecution of the case was contingent on the outcome of negotiations between the parties. Further, the delay in this case is much longer than the delay in Doug Johns, with a concomitant increase in the risk of injury to United Grain. We hold that the District Court did not abuse its discretion in deciding that it had “no other choice” than to reinstate dismissal and enter final judgment against Westland.

Finally, Westland complains that it was not warned that its case was in danger of being dismissed. In Cox v. Myllymaki (1988), 231 Mont. 320, 752 P.2d 1093, we reversed the district court’s dismissal for failure to prosecute because it did not consider the important factors of availability of an alternative sanction and the existence of a warning to the party causing the delay. There, however, we reversed primarily because the plaintiff had offered a reasonable excuse for the delay and the defendant had not demonstrated any actual prejudice. Cox, 752 P.2d at 1094; see also Becky, 798 P.2d at 1015, reiterating the same factors.

Here, Westland did not offer a reasonable excuse for its delay. Neither Rule 41(b), M.R.Civ.P., nor Cox mandates dismissal for lack of warning in the absence of a reasonable excuse for the delay. Moreover, Westland had two months to defend United Grain’s motion to dismiss, which was filed in June 1992 but not granted until August 1992. The fact that the District Court temporarily rescinded its dismissal, upon reading Westland’s brief, indicated that it was susceptible to persuasion, but Westland failed to pursue this apparent advantage and did not even comply with the court’s order to arrange for a pretrial scheduling conference in September 1992.

We hold that the District Court did not abuse its discretion in dismissing Westland’s claims for failure to prosecute.

AFFIRMED.

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

JUSTICE TRIEWEILER

dissenting.

I dissent.

Of the four factors to be considered in determining whether the District Court abused its discretion, three favor reversal of the District Court.

1. Defendants have shown absolutely no prejudice from the delay to which they contributed and about which they now complain;

2. No warning was ever given to plaintiffs that their case was in danger of dismissal; and

3. There was an obvious alternative available to the District Court. It could simply have set this case for trial and refused any further continuance.

Considering these factors in light of the compelling public policy favoring a party’s right to a hearing on the merits, I conclude that the dismissal of plaintiffs’ complaint was an abuse of discretion and would reverse the District Court.

JUSTICE GRAY joins in the foregoing dissent.


text:
    KEITH SADOWSKY and LINDA SADOWSKY, husband and wife, Plaintiffs and Appellants, v. THE CITY OF GLENDIVE, MONTANA, a municipal corporation, Defendant and Respondent.
    No. 93-098.
    Submitted on Briefs June 1, 1993.
    Decided July 20, 1993.
    50 St.Rep. 860.
    259 Mont. 419.
    856 P.2d 556.

      For Plaintiffs and Appellants: Marvin L. Howe, Simonton, Howe & Schneider, PC., Glendive.
    For Defendant and Respondent: Gary L. Day, Lucas & Monaghan, PC., Miles City.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Keith and Linda Sadowsky appeal from an order entered by the District Court for the Seventh Judicial District, Dawson County, denying their motion for an extension of time to file a notice of appeal. We affirm.

The dispositive issue is whether the District Court erred in denying the Sadowskys’ motion for an extension of time to file a notice of appeal. As a preliminary matter, we determine that a denial of a motion for extension of time to file a notice of appeal is itself an appealable order.

In 1988, the Sadowskys brought this action to recover damages to their property allegedly caused by water leaking from a lawn sprinkler system owned by the City of Glendive. In March 1990, the District Court entered summary judgment for the City based on the doctrine of sovereign immunity as explained in this Court’s opinion in Eccleston v. Third Judicial Dist. Court (1989), 240 Mont. 44, 783 P.2d 363.

In January 1991, this Court decided Crowell v. School Dist. No. 7 (1991), 247 Mont. 38, 805 P.2d 522, holding that the purchase of liability insurance by a school district operated as a waiver of sovereign immunity to the extent of the coverage granted by the insurance policy. Then, in June 1992, this Court decided Koch v. Billings School Dist. No. 2 (1992), 253 Mont. 261, 833 P.2d 181, holding that plaintiff Koch could reopen her case based upon the Crowell decision and pursuant to Rule 60(b)(6), M.R.Civ.R

On September 25, 1992, over two years after this case ended in a summary judgment, the Sadowskys moved for relief from the summary judgment based on Crowell and Koch. On November 23, 1992, the District Court entered an order granting that motion.

In January 1993, the City pointed out to the District Court that its November 23, 1992 order was invalid, because motions made under Rule 60, M.R.Civ.R, are deemed denied if no order is entered within forty-five days of the motion. The forty-five-day time limit had expired on November 9, 1992.

On January 20, 1993, the Sadowskys’ attorney moved, pursuant to Rule 5(a)(5), M.R.App.P., to extend the time in which they might file an appeal from the deemed denial of their motion for relief from summary judgment. Their motion was filed within the time allowed under Rule 5(a)(5), M.R.App.P. However, the District Court denied the motion for extension of time, ruling that there was no excusable neglect or good cause to justify an extension. The Sadowskys then noticed this appeal from the denial of their motion for an extension of time to file a notice of appeal.

The City claims that a denial of an extension of time to file a notice of appeal is not an appealable order. It relies on Zell v. Zell (1977), 172 Mont. 496, 498, 565 P.2d 311, 312, in which this Court stated that “[i]t is well settled in Montana that an untimely notice of appeal is a jurisdictional defect, which renders this Court powerless to hear the appeal.” However, in Zell the appellant did not file a motion for extension of time in district court, instead asking this Court to extend the time allowed for appeal. In other words, no timely notice of appeal was filed. In the present case, in contrast, the notice of appeal from the District Court’s order denying an extension was timely filed in the proper court. The question here is whether an order denying an extension of time to file an appeal is appealable.

The Sadowskys point out that, under the Federal Rules of Appellate Procedure, denial of a motion for extension of time to file an appeal is an appealable order. While it is true that some of the Montana Rules of Appellate Procedure are patterned after the Federal Rules of Appellate Procedure, not all are. The Federal Rules permit appeals only from orders that are made appealable by statute. 9 Moore’s Federal Practice, ¶ 110.01. In state courts in Montana, appealable orders are delineated not by statute but by Rule 1, M.R.App.P. “Rule 1, M.R.App.P., defines the limits of appealable actions.” Continental Ins. Co. v. Bottomly (1988), 233 Mont. 277, 279, 760 P.2d 73, 75. A denial of a motion for extension of time to file an appeal is not listed as an appealable order under Rule 1, M.R.App.P. On its face, therefore, Rule 1, M.R.App.P., prohibits this appeal.

The Sadowskys point out that this Court has reviewed instances in which district courts have granted extensions of time for filing a notice of appeal. E.g., First Security Bank of Havre v. Harmon (1992), 255 Mont. 168, 841 P.2d 521; Kizer v. Semitool, Inc. (1991), 251 Mont. 199, 824 P.2d 229; In re Marriage of Bahm (1987), 225 Mont. 331, 732 P.2d 846. In those cases, however, the extensions of time were reviewable in appeals of other, subsequent appealable orders or judgments as “intermediate order[s] or decision[s] excepted or objected to within the meaning of Rule 46 of the Montana Rules of Civil Procedure, which involve the merits, or necessarily affect the judgment[.]” See Rule 2, M.R.App.P.

Rule 1, M.R.App.P, allows appeal from “a final judgment entered in [a] ... special proceeding commenced in a district court.” The Sadowskys argue that the denial of their motion for an extension of time is such a judgment. This argument is flawed in that the order from which they wish to appeal is not a judgment.

The Sadowskys also cite Shields v. Pirkle Refrigerated Freightlines (1979), 181 Mont. 37, 591 P.2d 1120. In that case, this Court held that an order setting aside a default judgment on jurisdictional grounds was appealable, because it “in effect, finally concludes the case and the rights of the parties” and “amounts to a final judgment.” Shields, 591 P.2d at 1123. The Sadowskys maintain the same reasoning applies here.

We agree. The denial of the Sadowskys’ request for an extension of time to file a notice of appeal concludes this case just as finally as any final judgment. Because the denial of an extension of time to file a notice of appeal is not simply a ministerial act, but is a decision within the discretion of the district court, we conclude that it would be unjust to deny the right of appeal from such a decision. We therefore hold that the denial of a Rule 5(a)(5), M.R.App.P., motion for an extension of the time allowed for filing a notice of appeal is an appealable order.

We now consider whether the District Court abused its discretion in denying the Sadowskys’ request for an extension of time. Rule 5(a)(5), M.R.App.P., allows the district court to extend the time allowed for filing a notice of appeal “upon a showing of excusable neglect or good cause.” The Advisory Committee Notes to Rule 5(a)(5), M.R.App.P., state that “the district court should have the authority to extend time in extraordinary cases where injustice would otherwise result.”

In its order denying the request for the extension, the District Court stated:

At all times the Plaintiffs had control of this situation. They knew or should have known the time period after which the motion for relief is automatically denied. They could have requested a determination sooner from the Court. They also knew or should have known that the order of November 23 was issued without jurisdiction. It has been settled law in Montana for many years that once the 45-day time limit has expired the Court is without jurisdiction to take any action on the motion. In essence, although they argue that they relied upon such order, they had no right to rely upon it. Nothing occurred here that was beyond the Plaintiffs’ control. Therefore, the Court does not find any excusable neglect or good cause.

As the City points out, this Court has never affirmed a finding of excusable neglect or good cause under Rule 5(a)(5), M.R.App.P., due to counsel’s lack of understanding of the forty-five-day time limit on rulings on motions under Rules 59 and 60, M.R.Civ.P. It was the responsibility of the Sadowskys’ counsel to be aware of and to make sure the District Court was aware of the forty-five-day rule on the motion for relief from summary judgment. Lack of knowledge of a clear rule of civil procedure is not an excuse for relief from the rules. We conclude that the District Court did not abuse its discretion in ruling that the Sadowskys have failed to demonstrate excusable neglect or good cause justifying an extension of time for filing a notice of appeal.

We affirm the denial by the District Court of the motion for extension of time for filing a notice of appeal.

JUSTICES HARRISON, HUNT, NELSON and GRAY concur.


author: JUSTICE TRIEWEILER

text:
    IN RE THE MARRIAGE OF PERRY WAYNE MILLER, Petitioner and Respondent, and KATHY JO MILLER (BEAM), Respondent and Appellant.
    No. 92-155.
    Submitted on Briefs June 17, 1993.
    Rehearing Denied August 26, 1993.
    Decided July 27, 1993.
    50 St.Rep. 863.
    259 Mont. 424.
    856 P.2d 1378.

      For Appellant: Patrick F. Flaherty, Great Falls.
    For Respondent: Dan Falcon, Matteucci, Falcon, Squires & Lester, Great Falls.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

Appellant Kathy Jo Beam appeals from an order issued by the District Court for the Seventeenth Judicial District, Blaine County, in which the court modified the original custody decree and awarded the parties joint custody of their minor child, Lori.

We vacate the order of the District Court on the basis that the court lacked subject matter jurisdiction to modify the original custody decree, and remand to the court for dismissal of this action.

The following issue, raised sua sponte by this Court, is the only issue we find necessary to review:

Did the District Court have jurisdiction under Montana’s Uniform Child Custody Jurisdiction Act to hear and determine the motion for modification?

Kathy and Perry Miller were married in October 1980. A son, Joshua, was born in 1981, and a daughter, Lenore (Lori), whose custody is in dispute in this case, was born in June 1982. The marriage broke down, and in August 1982 Kathy and the children moved to her parent’s home in Johnstown, Pennsylvania.

On May 13,1983, the parties’ marriage was dissolved by the Blaine County District Court. The decree provided that the issues of custody and property distribution would be determined at a later date. After the dissolution, Joshua remained in Montana with Perry, and Lori returned to Pennsylvania with Kathy. Lori has lived in Pennsylvania ever since that time.

In 1985, the court entered its findings of fact, conclusions of law, and decree with respect to custody, child support, and distribution of property. Kathy was awarded custody of Lori and Perry was awarded custody of Joshua. This decision was based on the court’s findings that neither child had lived with the noncustodial parent since they were infants and that they were each happy and integrated with their respective families.

During the summer of 1990, when Lori was visiting in Montana, Perry petitioned for custody of Lori and obtained a temporary restraining order to keep her from returning to Pennsylvania. These actions were precipitated by Lori’s statements that Kathy’s live-in boyfriend was abusive to Kathy. Prior to the commencement of Perry’s action for modification, Lori had lived in Pennsylvania for approximately eight years, attended school there, and had only visited Perry in Montana for one month in 1988, and two months in 1989.

Hearings were conducted in the Montana court during February 1991. As a result of those hearings, the District Court found that neither Lori nor Kathy were endangered by a live-in boyfriend at that time. The court, therefore, lifted the temporary restraining order. However, the original decree was modified to provide for joint custody of Lori. The court’s modification was based on a stipulation which the parties entered into during the hearing.

Kathy sought reconsideration, but her motion was denied and judgment was entered on March 18,1992. From this judgment, Kathy appeals.

Kathy contends that the court coerced her into entering into the agreement and that it abused its discretion when it modified the 1985 custody decree because the statutory requirements for modification of custody were not satisfied. However, the dispositive issue, which we raise sua sponte, is whether the District Court had subject matter jurisdiction to hear and determine Perry’s motion for modification.

It is well established that the issue of subject matter jurisdiction may be raised at any stage of a judicial proceeding by a party or sua sponte by the court. O’Donnell v. Ryans, Inc. (1987), 227 Mont. 48, 49, 736 P.2d 965, 966. See also, State v. Davis (1984), 210 Mont. 28, 30, 681 P.2d 42,43; State v. Akers (1938), 106 Mont. 43, 57, 74 P.2d 1138, 1145; Oppenheimer v. Regan (1905), 32 Mont. 110, 115, 79 P. 695, 696. Once the issue is raised and it is determined that a court lacks subject matter jurisdiction, the only further action the court can take is to dismiss the case. Rule 12(h)(3), M.R.Civ.P.; In re Marriage of Lance (1984), 213 Mont. 182, 186-87, 690 P.2d 979, 981.

It is also a settled rule that subject matter jurisdiction cannot be waived nor conferred by consent of a party where there is no basis for jurisdiction under the law. O’Donnell, 736 P.2d at 966 (citing State v. Davis, 681 P.2d at 43). Thus, in this instance, Kathy’s appearance and participation in the proceedings cannot be construed as an acquiescence in, nor conferral of, subject matter jurisdiction.

All child custody determinations, including initial and modification decrees, are governed by the provisions of Montana’s Uniform Child Custody Jurisdiction Act (UCCJA), found at §§ 40-7-101 through -125, MCA. The stated purpose of the UCCJA is to:

[A]ssure that litigation concerning the custody of a child takes place ordinarily in the state with which the child and his family have the closest connection and where significant evidence concerning his care, protection, training, and personal relationships is most readily available and that courts of this state decline the exercise of jurisdiction when the child and his family have a closer connection with another state.

Section 40-7-102(l)(c), MCA.

Section 40-4-211, MCA, is incorporated into the UCCJA by § 40-7-104, MCA, and is the “premier jurisdictional hurdle which must be overcome before a district court may modify a child custody decree with interstate implications.” In re Marriage of Bolton (1984), 212 Mont. 212, 218, 690 P.2d 401, 404. This Court has made clear that the jurisdictional requirements of § 40-4-211, MCA, must be met before a court, which entered an initial custody decree, can exercise continuing subject matter jurisdiction to modify that decree. In re Marriage of Alpert (1993), [258 Mont. 344], 852 P.2d 669, 670-71, 50 St. Rep. 564, 565; Bolton, 690 P.2d at 404. Section 40-4-211, MCA, provides in pertinent part as follows:

(1) A court of this state competent to decide child custody matters has jurisdiction to make a child custody determination by initial or modification decree if:
(a) this state:
(i) is the home state of the child at the time of commencement of the proceedings; or
(ii) had been the child’s home state within 6 months before commencement of the proceeding ... or
(b) it is in the best interest of the child that a court of this state assume jurisdiction because:
(i) the child ... and at least one contestant have a significant connection with this state; and
(ii) there is available in this state substantial evidence concerning the child’s present or future care, protection, training, and personal relationships; or
(c) the child is physically present in this state and:
(i) has been abandoned; or
(ii) it is necessary in an emergency to protect him because he has been subjected to or threatened with mistreatment or abuse ... or
(d)(i) no other state has jurisdiction under prerequisites substantially in accordance with ... this section or another state has declined to exercise jurisdiction ... and
(ii) it is in his best interest that the court assume jurisdiction.

The record in this case reveals that prior to the commencement of this proceeding Lori lived in Pennsylvania for approximately eight years and only visited Montana during brief periods between 1988 and 1990. Thus, by definition, Montana is not Lori’s home state and the court had no jurisdiction under § 40-4-211(l)(a), MCA.

Next, the record demonstrates that Lori’s most significant connections are with Pennsylvania, and that is where relevant evidence concerning such things as her medical care, training, personal relationships, and protection is available. Her contacts with Montana at the commencement of the action were minimal, and relevant evidence is virtually non-existent in this State. Therefore, there is no jurisdictional basis under § 40-4-211(l)(b), MCA.

Third, we note that Pennsylvania, which has been Lori’s home state since 1982, has adopted the Uniform Child Custody Jurisdiction Act in nearly identical form as Montana. 23 Pa.C.S.A. §§ 5341 through 5366. Because it is both Lori’s home state and the state with which she has the most significant connections, Pennsylvania, under its version of the UCC JA, has subject matter jurisdiction to determine custody issues with respect to Lori. Since there is no evidence in the record to suggest that Pennsylvania has declined to exercise its jurisdiction in this instance, § 40-4-211(l)(d), MCA, does not confer jurisdiction on a Montana court.

Finally, the remaining alternative basis for jurisdiction set forth in § 40-4-211(l)(c), MCA, applies only in cases of abandonment, neglect, or extreme emergency. This Court made clear in Wenz v. Schwartze (1979), 183 Mont. 166, 179, 598 P.2d 1086, 1094, that, consistent with the Commissioners’ Notes to the Uniform Child Custody Jurisdiction Act, application of this section requires caution and “is to be used only in ‘extraordinary circumstances.’” See also, Application of Lang (1959), 193 N.Y.S.2d 763.

The facts of this case do not constitute an extraordinary or emergency situation. Although the modification petition was initiated due to the belief that Kathy was living in an abusive situation and that Lori had been threatened by the same individual, there was no evidence that Lori was in immediate danger. Moreover, by the time of the hearing in 1991, the court found that the situation with Kathy’s boyfriend had been “cured” and that it was reasonable to award split physical custody. Thus, the court’s own findings negated any argument that there was an emergency situation or necessity to immediately remove Lori from Kathy’s custody. Therefore, the section of the UCCJA which confers custody in emergency situations is not applicable here.

After carefully considering the record in this case, we conclude that none of the disjunctive requirements set forth in § 40-4-211, MCA, are satisfied. We hold that the Montana District Court lacked subject matter jurisdiction to intervene in this matter.

Accordingly, the judgment of the District Court is vacated, and pursuant to Rule 12(h)(3), M.R.Civ.P., we remand to the court for dismissal of this action.

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


author: JUSTICE GRAY

text:
    ANDREA “ANDY” BENNETT, State Auditor and Commissioner of Insurance of the STATE OF MONTANA, Plaintiff and Respondent on Claim Appeal, v. GLACIER GENERAL ASSURANCE COMPANY, Respondent and Respondent, MISSOULA HOTEL DEVELOPMENT ASSOCIATES, Claimant and Appellant.
    No. 92-551.
    Submitted on Briefs May 27, 1993.
    Decided July 27, 1993.
    50 St.Rep. 866.
    259 Mont. 430.
    857 P.2d 683.

      For Appellant: Ronald B. MacDonald, Datsopoulos, MacDonald & Lind, Missoula.
    For Respondent: J. Dennis Moreen and Patrick M. Driscoll, Chronister, Driscoll & Moreen, Helena.
   JUSTICE GRAY

delivered the Opinion of the Court.

Missoula Hotel Development Associates appeals from an order of the First Judicial District Court, Lewis and Clark County, designating its claim against the liquidated Glacier General Assurance Company for return of a $250,000 retained deposit as a Class 4 priority claim. We affirm.

The sole issue on appeal is whether Missoula Hotel Development Associates established a preferential right to $250,000 of the remaining assets of Glacier General Assurance Company.

In 1983, Missoula Hotel Development Associates (MHDA), a limited partnership, was created to develop a Sheraton Hotel in Missoula, Montana. To partially finance the project, MHDA negotiated a $9,350,000 loan with First National Bank of Minneapolis (First Bank). As a condition of the ten-year loan, First Bank required MHDA to secure the obligation with a financial guarantee bond issued by an insurance company. First Bank suggested Glacier General Assurance Company (Glacier) as a potential provider of the bond.

On December 29, 1983, MHDA and Glacier executed a financial guarantee bond that provided security for the $9,350,000 loan with First Bank. John Hayden, the president of Glacier, insisted that MHDA pay the premium of the bond, approximately $778,950, in advance and also provide a “retained deposit” of $250,000. The deposit, a standard practice in the industry, was intended to provide Glacier with a sufficient cushion to meet three months of payments on the underlying loan should MHDA default. Glacier would receive all accumulated interest on the retained deposit during the length of the loan and, if no default occurred, the $250,000 would be returned to MHDA when it satisfied its obligation to First Bank.

On December 30, 1983, Glacier deposited MHDA’s check of $1,028,950, representing the retained deposit and the prepaid bond premium, in its general operating account with First National Montana Bank of Missoula. For accounting purposes, the $250,000 was shown as an asset under “cash on hand” and as a liability under “amounts withheld or retained by the company for the account of others.” Douglas Hartz, assistant deputy liquidator with the State Auditor’s office, testified that, from his review of Glacier’s books, virtually every type of transaction took place through the general operating account. Glacier deposited all income from premiums and deposits, paid expenses and purchased investments through this general checking account.

On March 12, 1985, upon petition by the State Auditor and Commissioner of Insurance (Liquidator), the District Court ordered Glacier into rehabilitation pursuant to § 33-2-1332, MCA, of the Insurers Supervision, Rehabilitation, and Liquidation Act. On November 12, 1985, the District Court declared Glacier insolvent and ordered it into liquidation. MHDA petitioned the District Court to order the Liquidator to return its funds on deposit with Glacier. The court concluded that it lacked jurisdiction and dismissed the petition. We affirmed the dismissal in Bennett v. Glacier General Assurance Co. (1987), 229 Mont. 538, 748 P.2d 464.

MHDA timely filed claims with the Liquidator for the unearned portion of the $778,950 prepaid premium and the entire $250,000 retained deposit, asserting preference over claims by other Glacier creditors. The Liquidator accepted both claims in their entirety but recommended Class 4 priority treatment. MHDA objected to the Liquidator’s priority classification and the disputed claims process provided in § 33-2-1368, MCA, was initiated.

Pursuant to § 33-2-1368(2), MCA, the District Court appointed a referee to hear MHDA’s claims. MHDA alleged that the retained deposit was held in trust for MHDA and, thus, was not available for distribution by the Liquidator. As to the prepaid premium, MHDA alleged that it had been fraudulently obtained by Glacier.

The referee tried MHDA’s claims and subsequently issued his opinion, findings of fact and recommendation that both the retained deposit and the unearned premium be given Class 4 priority treatment under § 33-2-1371, MCA. With regard to the retained deposit, he concluded that MHDA and Glacier had established a trust and that MHDA had traced the trust funds to Glacier’s general operating account. However, he also determined that the general operating account dropped to a negative balance between the time the trust funds were deposited and Glacier’s insolvency. Therefore, MHDA’s trust property was extinguished, the trust ceased to exist, and MHDA’s right to preferential treatment from the account was eliminated.

The District Court adopted the referee’s recommendations. MHDA appeals, contesting only the Class 4 priority designation of the retained deposit.

Did MHDA establish a preferential right to $250,000 of the remaining assets of Glacier?

The parties do not dispute the referee’s findings of fact. Instead, MHDA contends that the referee misapplied the law in concluding that the trust property had been extinguished. Our review of legal conclusions is plenary. Steer, Inc. v. Dep’t of Revenue (1990), 245 Mont. 470, 475, 803 P.2d 601, 603.

In the present case, the parties agree that MHDA traced the trust property to the general operating account and that Glacier commingled the trust property with its own money in that account. It is well-established that when trust funds are commingled with private funds, the entire mixed fund will be impressed with the trust to the extent of the trust funds, except to the extent that the trustee may be able to distinguish and separate his own from the trust funds. Yellowstone County v. First Trust & Sav. Bank (1912), 46 Mont. 439, 442-3, 128 P 596, 599; Hawaiian Pineapple Co. v. Brown (1923), 69 Mont. 140, 148, 220 P. 1114, 1116. The trust property need not remain in its original form if the trust property is held by the trustee and the beneficiary can trace the trust property to its substituted form. State v. Banking Corp. of Montana (1926), 77 Mont. 134, 150, 251 P. 151, 153; Yellowstone County, 128 P. at 599; Restatement (Second) of Trusts § 202(1) (1959). Thus, it is clear that MHDA may impress a trust upon Glacier’s general operating account.

However, MHDA is entitled to a $250,000 preferential claim to the trust property in the general operating account only if the trust property continues to exist. Restatement, § 74. Unless MHDA can trace the $250,000 to another asset, MHDA’s preference to the funds in the general operating account cannot exceed the amount of the lowest balance on hand between the time of deposit of the trust funds and the time of liquidation. See Hawaiian Pineapple, 220 R at 1116 and Banking Corp., 251P. at 153-4. The low balance is often referred to as the “lowest intermediate balance.”

The theory behind this principle is that, if the amount of cash in the account reached a figure lower than the amount of the trust funds and later reached a higher figure, it is conclusive that some of the trust funds were dissipated, and other funds deposited. Because the deposits made after the account reached the lowest intermediate balance were made by persons other than the beneficiary, the beneficiary has no preference to the remaining funds in the account. Hawaiian Pineapple, 220 P. at 1116. Comment j to § 202 of the Restatement further explains that:

[w]here a trustee deposits in a single account in a bank trust funds and his individual funds, and makes withdrawals from the deposit and dissipates the money so withdrawn, and subsequently makes additional deposits of his individual funds in the account, the beneficiary cannot ordinarily enforce an equitable lien upon the deposit for a sum greater than the lowest intermediate balance of the deposit.... If after the deposit of the trust funds in the account the deposit was wholly exhausted by withdrawals before subsequent deposits of the trustee’s individual funds were made, the beneficiary’s lien upon the deposit is extinguished, and if he is unable to trace the money withdrawn, he is relegated to a mere personal claim against the trustee, and is entitled to no priority over other creditors of the trustee.

Here, testimony and exhibits of record establish that Glacier deposited the $250,000 in the general operating account on December 30, 1983. Sometime between October 19 and 22, 1984, Glacier’s general operating account reached the negative balance of - $328,777.72. Glacier was ordered into liquidation on November 12, 1985. Thus, when the account reached the lowest intermediate balance in 1984, MHDA’s trust funds in the account were dissipated and its right to a preferential claim against Glacier was extinguished as well. Any subsequent deposits into the general operating account were made with funds which MHDA has no right to claim.

MHDA agrees that it has the burden of tracing the trust property, but argues that it need only establish that the combined values of Glacier’s stocks, bonds and cash on hand did not fall below the amount of the trust funds. MHDA asserts that Glacier commingled the retained deposit with stocks and bonds and, therefore, that it is entitled to impress a trust on the commingled aggregate of those three liquid assets. Thus, according to MHDA, the principles of Hawaiian Pineapple are satisfied because the lowest intermediate aggregate values of the three assets did not fall below the amount of the trust property. We disagree.

Although MHDA characterizes the stocks, bonds, and cash on hand as a commingled mass of general funds, the stocks and bonds were separate assets held by Glacier, not merely separate accounts deposited at the same bank as the general operating account. Glacier’s financial statements show that it owned a variety of classes and amounts of stocks and bonds. The evidence also established that retained deposits were treated as a separate liability and were debited only to the “cash on hand” asset account. MHDA’s assertion that the three assets were commingled accounts that were continuously “in the bank, so to speak” is incorrect.

Further, MHDA claims that Glacier’s counsel testified that Glacier commingled the cash, stock and bond accounts to limit litigation, characterizing the stocks and bonds as “other general funds.” In fact, Glacier’s counsel did not mention stocks or bonds in the portion of his testimony relied on by MHDA; he testified only that the trust monies were commingled with Glacier’s other general funds. We cannot agree that Glacier’s counsel’s reference to “other general funds” included Glacier’s separate stock and bond assets. We conclude that MHDA did not establish that Glacier commingled the funds from the general operating account with the stocks and bonds. Without a commingling of the three assets, MHDA is not entitled to aggregate the values of the three assets and, therefore, cannot overcome the result dictated by the principles of Hawaiian Pineapple.

As explained above, if MHDA could trace the $250,000 from the general operating account to the purchase of another asset, it would be entitled to impress a trust upon the substitute property. See Yellowstone County, 128 P. at 599; Banking Corp., 251 P. at 153; Restatement, § 202 (1). In this case, we conclude that MHDA did not trace the $250,000 to the subsequent purchase of any other asset.

Glacier’s counsel testified that funds from the general operating account were used to purchase stocks and bonds, but testimony also established those funds were used for nearly all of Glacier’s business transactions. Glacier’s counsel did not identify any transaction in which MHDA’s $250,000 retained deposit was used to purchase either stocks or bonds. Doug Hartz testified that, from his review of the books, he could not identify any $250,000 investment from the operating account during the relevant time period and that Glacier had no documentation identifying which funds were used to purchase stocks and bonds. Although Glacier previously had purchased such investments with funds in the general operating account, this fact alone does not establish that MHDA’s $250,000 retained deposit was used to purchase stocks and bonds; nor does it begin to identify the particular stocks and bonds upon which MHDA would be entitled to impress a trust.

We faced a similar situation in Banking Corp. There, a banking customer presented a $3,210 claim against a failed bank. The bank had $1,891.67 on hand when it closed its doors and $19,270.45 deposited in other banks. Banking Corp., 251 P. at 153-4. Without evidence that the customer’s $3,210 was commingled with the funds deposited in other hanks, we concluded that the customer had only traced the trust funds to the $1,891.67 on hand and, therefore, was entitled to a preference only to that extent. Banking Corp., 251 P at 153-4.

Similarly, MHDA traced its retained deposit only to Glacier’s general operating account; it did not establish that its $250,000 was commingled with or used to purchase any other assets. Therefore, MHDA did not establish a preferential right to $250,000 of Glacier’s remaining assets. We hold that the District Court did not err in adopting the referee’s recommendation and in concluding that the retained deposit is a Class 4 priority claim.

Affirmed.

JUSTICES HARRISON, NELSON, HUNT, and WEBER concur.


author: JUSTICE GRAY JUSTICE HUNT

text:
    MISSOULA COUNTY HIGH SCHOOL EDUCATION ASSOCIATION, Plaintiff and Appellant, v. BOARD OF TRUSTEES, MISSOULA COUNTY HIGH SCHOOLS, Defendant and Respondent.
    No. 92-572.
    Submitted on Briefs March 11, 1993.
    Decided July 28, 1993.
    50 St.Rep. 870.
    259 Mont. 438.
    857 P.2d 696.

      For Plaintiff and Appellant: Emilie Loring, Missoula.
    For Defendant and Respondent: Molly Shepherd, Worden, Thane & Haines, Missoula.
   JUSTICE GRAY

delivered the Opinion of the Court.

The Missoula County High School Education Association appeals from an order of the Fourth Judicial District Court, Missoula County, granting summary judgment in favor of the Missoula County High School Board of Trustees. We affirm.

The sole issue on appeal is whether the District Court erred in concluding that the Missoula County High School Board of Trustees was not required to arbitrate the elimination of a lay reader program.

Prior to the 1991-92 school year, the Missoula County High School District operated a lay reader program in the Missoula County high schools. Under the program, lay readers assisted high school teachers in reading and correcting student papers. In August of 1991, the Missoula County High School Board of Trustees (the Board) informed the teachers that it was eliminating the program.

The teachers’ employment was governed by the Master Agreement (the Agreement), a collective bargaining agreement entered into by the Board and the Missoula County High School Education Association (the Association), the teachers’ collective bargaining representative. The Agreement sets forth a procedure for resolving grievances. Level Four of the grievance procedure allows the Association to submit a grievance to arbitration if attempts to resolve the dispute pursuant to Levels One through Three are unsuccessful.

On September 10, 1991, the Association filed a grievance with Dennis Kraft, the Missoula County High School Superintendent. The Association asserted that the Board’s unilateral elimination of the lay reader program violated Article 1.1 of the Agreement. According to the Association, the elimination of the program constituted a change in working conditions requiring collective bargaining under Article 1.1. The grievance requested that the lay reader program be reinstated. Kraft determined that the elimination of the program was not grievable.

The Association then filed a grievance with the Board. After a hearing, the Board concurred with Kraft and determined that elimination of the program was not grievable under the Agreement.

The Association then notified the Board that it wished to submit the grievance to arbitration. The Board refused to arbitrate elimination of the lay reader program, reasoning that if the matter was not grievable, it could not be arbitrated under the grievance procedures of the Agreement.

On December 12, 1991, the Association filed a complaint requesting the District Court to compel the Board to arbitrate elimination of the program under §§ 27-5-113 and 27-5-115, MCA. Based on stipulated facts, the parties filed cross-motions for summary judgment. On August 24, 1992, the District Court granted summary judgment in favor of the Board and subsequently denied the Association’s application to compel arbitration. This appeal follows.

Did the District Court err in concluding that the Missoula County High School Board of Trustees was not required to arbitrate the elimination of the lay reader program?

The District Court concluded that elimination of the lay reader program did not constitute a grievance under the terms of the Agreement and, on that basis, that the Board was not required to arbitrate the matter under the Agreement’s grievance procedures. Accordingly, the court granted summary judgment in favor of the Board and denied the Association’s application to compel arbitration.

Summary judgment is proper when no genuine issues of material fact exist and the moving party is entitled to judgment as a matter of law. Rule 56(c), M.R.Civ.R No genuine issues of material fact exist in the case before us; the District Court entered summary judgment based on stipulated facts. Therefore, we review the District Court’s conclusion of law regarding arbitrability to determine whether it is correct. See Steer, Inc. v. Dep’t of Revenue (1990), 245 Mont. 470, 474, 803 P.2d 601, 603.

The Association’s first contention is that Title 39, Chapter 31, MCA, entitled Collective Bargaining for Public Employees, requires arbitration of the elimination of the lay reader program. The Association asserts that it entered into a collective bargaining agreement containing a grievance procedure culminating in final and binding arbitration, as allowed by § 39-31-306, MCA. The Association then contends that if the Board is not required to submit a grievance to arbitration, Montana’s policy of encouraging collective bargaining to arrive at “friendly adjustment” of disputes between public employers and their employees, codified in § 39-31-101, MCA, will be negated.

The statutes governing collective bargaining for public employees do not provide a basis for requiring arbitration of the program elimination. Although the Agreement contains a grievance procedure culminating in arbitration, as allowed in § 39-31-306(2), MCA, the mere existence of this provision does not require all controversies to be arbitrated. By entering into a collective bargaining agreement that provides for arbitration, the parties to the agreement do not consent to submitting all disputes to arbitration. Indeed, § 39-31-306(3), MCA, expressly provides that a collective bargaining agreement shall be enforced “under its terms.” Thus, the terms of the agreement determine the arbitrability of a dispute. See Local 1334 v. City of Great Falls (1988), 233 Mont. 432, 760 P.2d 99.

The Association also contends that the District Court was required to order arbitration under Montana’s Uniform Arbitration Act, §§ 27-5-111 through 27-5-324, MCA. The Association correctly states that, pursuant to § 27-5-113, MCA, the Uniform Arbitration Act generally applies to collective bargaining agreements. Asserting that the Board has not raised any legal or equitable grounds that would preclude enforcement of a written agreement to arbitrate under § 27-5-114(2), MCA, the Association contends that § 27-5-115, MCA, requires the District Court to order arbitration upon the showing of a written agreement containing an arbitration provision.

The flaw in the Association’s reliance on the Uniform Arbitration Act is underscored by the Association’s reliance on the initial language of § 27-5-115(1), MCA, rather than the entirety of the subsection. Section 27-5-115(1), MCA, provides:

On the application of a party showing an agreement described in 27-5-114 and the opposing party’s refusal to arbitrate, the district court shall order the parties to proceed with arbitration; but if the opposing party denies the existence of the agreement to arbitrate, the court shall proceed summarily to the determination of that issue raised and shall order arbitration if it finds for the applying party or deny the application if it finds for the opposing party.

The Association interprets this subsection to require arbitration, at a party’s request, of any and all disputes arising between parties to a collective bargaining agreement containing an arbitration provision. On this basis, it contends that, as a matter of law, the District Court could not refuse to compel arbitration.

The Association’s interpretation ignores the specific language contained in § 27-5-115(1), MCA, requiring the District Court to determine the arbitrability of a controversy when one party to the agreement denies that it requires arbitration. Additionally, § 27-5-115(1), MCA, requires the court to deny an application for arbitration if it determines that an agreement to arbitrate the controversy does not exist.

We conclude that the District Court properly followed the procedures set forth in § 27-5-115(1), MCA. The Association sought to compel arbitration and the Board asserted that no agreement to arbitrate elimination of the lay reader program existed. The court reviewed the Agreement, determined that it did not contain an agreement to arbitrate the dispute at issue and, as a result, denied the Association’s application for arbitration.

We turn our attention, then, to the terms of the Agreement to ascertain whether the District Court erred in concluding that the Board’s elimination of the program was not arbitrable. Article 4.4 of the Agreement allows the Association to submit a “grievance” to arbitration if prior levels of the grievance procedure have not resolved it. Article 1.3 defines grievance as “[a]n alleged violation or misinterpretation of a specific provision of this Agreement.” Thus, because the ultimate question of arbitrability depends on whether the dispute constitutes a grievance, we focus on determining whether the Association has alleged a violation or misinterpretation of a specific provision of the Agreement.

The Association contends that the Board violated Article 1.1 of the Agreement, which provides:

Recognition: The Board hereby recognizes the Association as the exclusive and sole representative for collective bargaining concerning wage, hours, fringe benefits and other conditions of employment, as provided by law, and will meet and confer on such matters as the parties deem appropriate.

The Association construes this provision as an agreement by the Board to collectively bargain wages, hours and other conditions of employment. The Association then alleges that the Board violated Article 1.1 by failing to bargain collectively “conditions of employment” when it eliminated the lay reader program. On this basis, the Association contends that it has alleged a violation of a specific provision which constitutes a “grievance” under Article 1.3 of the Agreement. The Association’s argument is flawed.

First, an alleged violation of the Board’s duty to bargain is not properly resolved by arbitration, the remedy sought here by the Association. Alleged violations of the duty to bargain collectively are subject to procedures and remedies set forth in the unfair labor practices statutes applicable to collective bargaining for public employees. See §§ 39-31-401 through -409, MCA. Specifically, § 39-31-401(5), MCA, provides that the failure of a public employer, such as the Board, to bargain collectively in good faith is an unfair labor practice. Unfair labor practices are remediable by the board of personnel appeals pursuant to §§ 39-31-403, -406, and -408, MCA.

In this same regard, the Association’s reliance on First National Maintenance Corp. v. NLRB (1981), 452 U.S. 666, 101 S.Ct. 2573, 69 L.Ed.2d 318, is misplaced. First National is an unfair labor practice case alleging a violation of the employer’s duty to bargain in good faith a particular decision and its “effects” under the specific language of the National Labor Relations Act (NLRA). It did not entail an effort to compel arbitration and did not necessitate a determination of whether a dispute constituted an arbitrable grievance under the language of a collectively bargained agreement. Nor does First National support in any way the Association’s effort here to convert an asserted violation of the duty to bargain in good faith into an arbitrable grievance.

Furthermore, the Association has failed to allege a violation of a “specific provision” of the Agreement that would serve as the basis for a grievance. The Agreement before us contains thirteen titled Articles, each containing a number of separate provisions. For the most part, the provisions are specific statements of rights, obligations and duties by the Board and the Association. A claimed violation of such a provision would fall within the definition of a grievance set forth in Article 1.3 of the Agreement.

Article 1 of the Agreement is entitled “Recognition and Definition” and contains three provisions: 1) the Board’s recognition of the Association as the exclusive representative for collective bargaining and agreement to meet and confer as the parties deem appropriate; 2) a definition of “meet and confer” which encompasses the exchange of views and concerns; and 3) definitions of other terms used in the Agreement. These provisions, while separately stated, are for the most part qualitatively different from the specific provisions regarding rights, obligations and duties contained throughout most of the Agreement, the violation of which is intended to form the basis for a grievance. We conclude that the violation of Article 1.1 asserted by the Association — the Board’s failure to collectively bargain conditions of employment — is not an alleged violation of a “specific provision” of the Agreement and, therefore, does not constitute a grievance under Article 1.3.

We find support for our conclusion in International Union v. Acme Precision Prod. (E.D.Mich. 1981), 521 F. Supp. 1358. There, a union filed a grievance relating to Acme’s unilateral closure of its die casting and pulley manufacturing operations. The collective bargaining agreement defined “grievance,” in pertinent part, as a claimed violation of one of its provisions. The sole basis for the grievance was a claimed violation of the agreement’s recognition article.

The United States District Court observed that a mere allegation that a collective bargaining agreement has been violated is not sufficient to justify an order to arbitrate; a party must point to a specific provision of the contract to support its demand for arbitration, and the union failed to do so. International Union, 521 F. Supp. at 1361. The court specifically rejected the union’s contention that the recognition article provided such a basis, determining that it represented essentially “boilerplate harmony” language. International Union, 521 F. Supp. at 1362.

We hold that the Board’s elimination of the lay reader program is not an alleged violation of a specific provision of the Agreement and, therefore, does not constitute a grievance. Because it is not a grievance, the Association is not entitled to arbitrate the dispute under the Agreement’s grievance procedures.

Finally, the Association attempts to make an “effects” argument under Union-Scioto Local School District Board of Education v. Unioto Support Association (Ohio App. 1992), 603 N.E.2d 375. In Union-Scioto, a union filed a grievance and sought to arbitrate the school board’s reduction of bus drivers’ hours and modification of bus routes. The school board refused to arbitrate because the collective bargaining agreement provided that modification of bus routes was not subject to arbitration. In response, the union contended that it was challenging the elimination of work hours, an arbitrable issue.

. The Ohio Court of Appeals concluded that arbitration was properly ordered. It determined that the collective bargaining agreement was susceptible to two reasonable but conflicting interpretations regarding the arbitrability of the school board’s action. The agreement permitted arbitration if the action actually eliminated work hours; however, if the action merely modified bus routes, it was not arbitrable. Because the parties had agreed to submit their contract interpretation disputes to arbitration, the court reasoned that the contract was properly interpreted by an arbitrator and not a reviewing court. Union-Scioto, 603 N.E.2d at 376.

Union-Scioto is not applicable. It is a “competing interpretations” case, whereas here, the Agreement is not susceptible to two reasonable interpretations regarding the arbitrability of the Board’s action, one of which would support the Association’s application to compel arbitration. The only provision that the Association asserts has been violated is Article 1.1 and it has not advanced an interpretation of that provision which arguably would compel arbitration. Moreover, nothing in Union-Scioto supports the Association’s effort to rely on it for an “effects” argument.

We hold that the District Court correctly concluded that elimination of the lay reader program was not a grievance subject to arbitration. On that basis, it properly granted the Board’s motion for summary judgment and denied the Association’s application to compel arbitration.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES HARRISON and WEBER concur.

JUSTICE HUNT

dissenting.

I dissent. The result of the majority opinion is to dissolve the arbitration agreement between the parties by allowing either party to deny a grievance existed and that there is nothing to arbitrate. It is clear to me that § 39-31-101, MCA, which states that it is the policy of the State of Montana to encourage the practice and procedure of collective bargaining to arrive at friendly adjustment of all disputes between public employers and their employees to promote public business by removing certain recognized sources of strife and unrest, was meant for these facts and this type of controversy. The working conditions for the teachers are certainly changed and come within the meaning of § 39-31-103(10), MCA, which provides for arbitration for a controversy that concern the terms, tenure, or conditions of employment between the parties.