text:
    STATE OF WASHINGTON, ex rel., JEANNE A. BLAKESLEE, Petitioner/Appellant, v. RONALD ALSON HORTON, Sr., Respondent.
    No. 85-639.
    Submitted on Briefs April 30, 1986.
    Decided July 24, 1986.
    722 P.2d 1148.

      Harold Hanser, Yellowstone Co. Atty., Terence M. Swift, Deputy Co. Atty., Billings, for petitioner/appellant.
    Stephens Law Firm, Robert L. Stephens, Jr., Billings, for respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

This is an appeal by the petitioner from an order of the Yellowstone County District Court, the Honorable Charles Luedke presiding, denying enforcement of a petition for child support made under the Uniform Reciprocal Enforcement of Support Act (“URESA”). We affirm.

On December 18, 1984, the petitioner/appellant, Jeanne Blakeslee (“mother”), filed a petition for support under URESA in the County Attorney’s office in Clark County, Washington. The mother was at that time a resident of Clark County, Washington. The petition requested that respondent, Ronald Horton (“father”), be ordered to pay current child support in the amount of $50 per month and that an order be entered granting the mother a judgment in the sum of $8,850 for support arrearages owed to her as of December 18, 1984. The mother and father had been granted a divorce decree in March of 1970 in Yellowstone County which ordered the father to pay support in the amount of $50 per month to the mother for the support of their minor child. The record is undisputed that the father has never made any support payments to the mother as specified in the divorce decree.

The mother’s URESA petition was forwarded to the Yellowstone County Attorney’s Office in January of 1985 for enforcement. The District Court thereafter issued an order to show cause to the father asking him to come before the court and explain why he should not be required to pay the child support the mother had requested in her petition. A hearing on the matter was held, without a court reporter present, and on November 27, 1985, Judge Luedke issued his memorandum and order. In the order Judge Luedke determined that the husband did not owe any current or past due child support as requested by the mother in her petition. From this ruling the mother has appealed.

The mother now presents the following issue for review by this Court: Whether the order of the District Court which excuses the father from paying the child support ordered in the divorce decree is an abuse of the court’s discretion and endangers the welfare of the minor child of the parties by denying the child its right of support?

It should also be noted that the father in his brief suggests that Judge Luedke’s above mentioned order may not be a “final” judgment or order in this matter thereby making it non-appealable under Rule 1(a), M.R.App.Civ.P. We disagree. After reviewing Judge Luedke’s memorandum and order, it appears to this Court that Judge Luedke made a final determination of the mother’s request for child support under her URESA petition. Such a determination by Judge Luedke constitutes an appealable order under Rule 1(a).

In her brief, the mother strongly argues that the District Court blatantly abused its discretion in refusing to order the father to support his minor child. The mother contends the court’s decision totally ignores the welfare of the child and its right to support. Furthermore, the mother points out, the court’s order is contradictory to existing Montana law.

On the surface, the mother’s argument appears to have some merit, especially in light of the harsh result as ordered by the District Court. However, when the court’s decision is considered in light of the circumstances surrounding this case, the result seems to come into perspective. In his order and memorandum Judge Luedke recites in considerable detail the facts under which the mother pursued her URESA petition and the reasons why he believed her petition should be denied. We note we can find little, if any, fault with Judge Luedke’s decision in this matter and we therefore adopt his well analyzed memorandum and order and offer the same as the basis for this opinion.

“This is an action brought under URESA against a father to enforce child support due under a March 27th, 1970, divorce Decree providing for payments of $50.00 per month commencing April, 1970, payable through the office of the Clerk of District Court. As of the date of the petition, which was filed in December, 1984, a total arrearage of $8,850.00 had accrued, no payment whatever having been made at any time.

“The father defends against enforcement through this proceeding by testifying that after the divorce, the mother took the position that if the father would stay out of her life and the child’s life, they would stay out of his. The father has proceeded on this basis throughout the ensuing years. He has never made any application for modification of the Decree to eliminate the child support provision nor has he attempted to enforce the visitation privileges accorded him in the divorce Decree.

“There is no evidence from or on behalf of the mother with respect to such alleged understanding, either denying or admitting it. However, the mother has never before sought payment. At one point, when asked to sign a satisfaction of child support to permit the father to purchase a home, she first agreed, according to the father, and then later changed her mind and refused. However, she took no affirmative action otherwise. The mother is not receiving public assistance, but has made a non-assistance assignment pursuant to the laws of the State of Washington for the purposes of this action. All indications are that she is pursuing her petition on her own initiative, although she is utilizing the prosecuting attorneys in Washington and Montana for that purpose.

“The father has never seen the child involved, nor known of its whereabouts or the whereabouts of the mother until this proceeding was instituted. Although child support payments were to be made through the Clerk of Court, no record thereof was ever set up, meaning that the father never made a payment and the mother never made any inquiry of that office concerning any payment.

“The totality of the circumstances appearing — and the evidence is admittedly scanty from the standpoint of the mother — indicates that the parties did arrive at a mutual arrangement where each stayed away from the other, and that this was a satisfactory status to both parties until something prompted the mother to take advantage of the legal fact that child support in a Decree is a judgment which is constantly accruing on a monthly basis and is not subject to retroactive change.

“Consequently, she can turn the clock backwards on the understanding which was entered into and became consummated by mutual observance over the years, and create a financial windfall situation — one that can be pursued through County prosecuting offices by filling out and signing forms in a local office without any personal expense to her.

“The father and the child, on the other hand, cannot turn the clock backwards to recapture the association which they should have had and could have had, except for the agreement which was made and has been followed.

“The law is clear that the arrearage in child support payment cannot be modified by the Court upon any retroactive basis. [Section 40-4-208, MCA.]

“The law is also clear that the child support and child visitation are separate incidence, neither being dependent nor conditioned upon the other. [Section 40-5-124, MCA; see, State ex rel. Dewyea v. Knapp (Mont. 1984), 208 Mont. 19, 674 P.2d 1104, 41 St.Rep. 143.]

“These legal principles, however valid they may be as a general rule, are rendered impotent when the parties mutually agree that they be ignored and also carry out such agreement in actual fact for fourteen years, as has been done here.

“The arrearage for child support may remain technically inviolable and the theoretical right to visitation may continue on the same basis, but the enforceability of each in this case cannot be automatically implemented without any recognition being given to the reality of the past acts and omissions chargeable to the parties. Equity cannot allow the mother to participate in nullification of the purpose of the law in fact and, at the same time, allow her to claim the benefit of it in theory, simply because there is a meter running which can total a dollar loss in child support, but nothing to total the loss of a father-son association. (Emphasis added.)

“The mother has been satisfied with silence for fourteen years and received what must have been construed by her to be a benefit for both herself and the child, i.e., a complete lack of contact with the father. There is no assertion made or even suggested by the mother that the present request is founded upon any actual need of the child which has existed, but has not been satisfied over the years, or which has now arisen and could serve to validate her action in pursuing payment at this belated point.

“If evidence exists which explains, from the standpoint of the mother and child, why the mother was content to consider the lack of any contact with the father as anything other than an acceptable trade-off against receipt of child support, it has not been made known to the Court. Upon the basis of the record now before the Court, a concern does arise as to whether the Court is being properly used, and for that reason the evidence before the Court does demonstrate that the respondent has shown ample cause why the Court should not order at this time and in this cause what has been requested by the petitioner.

“IT IS SO ORDERED.”

We find Judge Luedke’s memorandum and order speaks for itself. Although legally the mother may have been correct in her claim for child support, equity demands that her claim must fail. This Court has long adhered to such principles of equity. We have noted that there are circumstances where a litigant may be remediless . . unless equity could afford him relief.” Link v. Haire (1928), 82 Mont. 406, 420, 267 P. 952, 956. Further, we have stated that “[w]hen a District Court sits as a court of equity, it is empowered to determine the questions involved in the case and to do complete justice.” Sawyer-Adecor International, Inc. v. Anglin (1982), 198 Mont. 440, 455, 646 P.2d 1194, 1202. See also, Rase v. Castle Mountain Ranch, Inc. (Mont. 1981), 631 P.2d 680, 38 St.Rep. 992.

In conclusion, we note that the instant case does not reverse or modify our previous case law which holds that each installment under an order for periodic child support is final and non-modifiable when it falls due. We only hold that Judge Luedke’s memorandum and order constitutes a sound exercise of the District Court’s discretion and also is a correct application of accepted principles of equity in this state.

The order of the District Court is affirmed.

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


source: Caselaw Access Project

author: MR. JUSTICE HUNT MR. JUSTICE WEBER,

license: Public Domain

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. KEVIN JOSEPH SWANSON, Defendant and Appellant.
    No. 85-491.
    Submitted on Briefs April 4, 1986.
    Decided July 25, 1986.
    722 P.2d 1155.

      Torger S. Oaas, Lewistown, for defendant and appellant.
    Mike Greely, Atty. Gen., Barbara Claassen, Asst. Atty. Gen., Helena, Craig R. Buehler, Co. Atty., James Stogsdill, Deputy Co. Atty., Lewistown, for plaintiff and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Swanson appeals from an order of the Fergus County District Court denying his motion to dismiss and finding him guilty of driving under the influence of alcohol.

We reverse and remand.

Swanson raises the following issues on appeal:

1. Whether he was denied due process by being deprived of a reasonable opportunity to gather exculpatory evidence, and

2. Whether the District Court erred in denying his motion to dismiss and granting the State’s motion to strike Swanson’s motion?

On January 9, 1985, at 1:30 a.m., Swanson was stopped by Officer McCoy of the Lewistown Police Department. Swanson was taken to the police station where his actions were video taped. He performed three field sobriety tests. After performing the tests, the officer placed him under arrest for driving under the influence of alcohol. The officer then read Swanson his Miranda rights and the implied consent law. The officer requested Swanson to submit to a breath test. Swanson refused to submit to the breath test, but said he would submit to a blood test. The officer informed Swanson that a blood test would be done at Swanson’s expense.

After talking to his parents by telephone, Swanson was taken to the hospital where a blood sample was drawn. The sample was placed in a glass vial with an address where it was to be sent for analysis, and with a label saying “Keep Refrigerated.” The sample was given to the officer who gave it to Swanson telling him it was Swanson’s sample, that he was responsible for paying for it, and that he should send it in as soon as possible.

From the hospital, Swanson was transferred to the Sheriffs office. At the Sheriffs office, the officer again told Swanson that he should send the sample to the address on the container. During the booking process the sample was taken from Swanson and placed on the counter in the booking room. Swanson was placed in the Fergus County Jail. When the officer left the Sheriffs Office, he saw the sample on the Counter in the dispatch room. The officer next saw the sample one or two days later at the police station. He placed the sample in the refrigerator, then called Swanson’s father and told him that someone needed to get the sample and send it for analysis. Swanson’s father picked up the sample on January 13, 1985. Swanson was released on his own recognizance on January 11, 1985.

The sample was never analyzed. The parties entered into a stipulation regarding the decreased validity of the sample due to its not being refrigerated. The stipulation stated:

“In lieu of submitted formal proof in the form of testimony (sic) and exhibits, it is hereby stipulated as follows:

“1. That on January 9, 1985, in reference to the above entitled case a blood sample was taken from Kevin Swanson at the Central Montana Hospital.

“2. The blood sample was improperly preserved in that it was not refrigerated. Due to the length of time which elapsed between the drawing of said sample and the laboratory analysis thereof a valid determination of its blood alcohol content could not be made.

“3. Had this blood sample been properly preserved and timely sent to a laboratory for analysis it would have indicated Kevin Swanson’s actual blood alcohol content at the time said sample was drawn.

“DATED this 5th day of June, 1985.

Swanson filed a motion to dismiss on June 7, 1985. On June 14, 1985, the State filed a motion to strike Swanson’s motion. Following a June 19, 1985 hearing, the court took the motions under advisement and decided to consider them at the time of trial.

Following a nonjury trial held July 1, 1985, the District Court filed an order denying Swanson’s motion, granting the State’s motion, and finding Swanson guilty. Swanson appeals from this order.

The first issue is whether Swanson was denied due process by being deprived of a reasonable opportunity to gather exculpatory evidence? Swanson argues that his inability to have his blood sample analyzed was the fault of the State. The State counters that Swanson had no right to an independent test, that the arresting officer facilitated Swanson’s having a blood sample drawn by taking him to the hospital, and that no further action was required.

Section 61-8-402(3), MCA, states that if a driver refuses to submit to an alcohol test designated by the arresting officer, then none shall be given by that officer. The statute concerning additional tests is Section 61-8-405(2), MCA, which states:

“The person tested may, at his own expense, have a physician or registered nurse of his own choosing administer a test, in addition to any administered at the direction of a peace officer, for the purpose of determining the amount of alcohol in his blood at the time alleged as shown by chemical analysis of his blood, breath, or urine.”

A criminal accused has a constitutional right to attempt to obtain exculpatory evidence. When the crime involves intoxication, the accused has a right to obtain a sobriety test independent of that offered by the arresting officer. The language of Section 61-8-405(2), MCA, does not support the State’s interpretation that the right to an independent test arises only after the accused takes a test designated by the arresting officer. The Arizona Appellate Court interpreted a statute identical to Section 61-8-405(2), MCA, and held that the State’s interpretation “would result in an unconstitutional restraint on the right of a criminal accused to attempt to obtain independent evidence of his innocence and operate to deprive the accused of due process of law.” Smith v. Cada (1977), 114 Ariz. 510, 562 P.2d 390, 393. Other cases also hold that denying one charged with an offense involving intoxication the right to attempt to obtain at his own expense a blood or other test to establish sobriety amounts to a denial of due process. State v. Choate (Tenn. 1983), 667 S.W.2d 111; McNutt v. Arizona (1982), 133 Ariz. 7, 648 P.2d 122; State v. Snipes (Mo.1972), 478 S.W.2d 299; Kesler v. Department of Motor Vehicles (1969), 1 Cal.3d 74, 81 Cal.Rptr. 348, 459 P.2d 900; In re Martin (1962), 58 Cal.2d 509, 24 Cal.Rptr. 833, 374 P.2d 801.

We agree with these cases and hold that one accused of a crime involving intoxication has a right to obtain an independent blood test to establish his sobriety regardless of whether he submits to a police designated test. The question becomes whether the State interfered with Swanson’s attempt to obtain this independent test. As the California Supreme Court stated:

“[P]olice officers are not required to take the initiative or even to assist in procuring any evidence on behalf of a defendant which is deemed necessary to his defense. (Citations omitted.) But in no event can duly constituted authority hamper or interfere with efforts on the part of an accused to obtain a sampling of his blood, without denying to him due process of law. We are persuaded to such conclusion in any instance where the conduct of the authorities, whether through affirmative action or by the imposition of their rules and regulations, imposes any material obstacle in the path of the accused. Nor are we impressed that an accused, as perhaps in the instant case, might have reached his goal by pursuing a different course. It is sufficient if, in seeking to establish the fact of the alcoholic content of his blood, the authorities, by their actions or regulations, frustrate his reasonable efforts designed to produce probative evidence.”

In re Martin (Cal.1962), 58 Cal.2d 509, 24 Cal.Rptr. 833, 835, 374 P.2d 801, 803.

In this case, the arresting officer transported Swanson to a hospital to enable him to have a blood sample drawn, and transported him back to the Sheriff’s office. Swanson was then booked into the Fergus County Complex. His property, including the blood sample, was taken from him. Although the sample was clearly marked “Keep Refrigerated,” the arresting officer testified that the sample was left on the counter in the dispatch room. The sample was not given to Swanson upon his release. One or two days later the officer found the sample on a counter at the police station. He then placed the sample in the refrigerator.

While the police have no duty to assist an accused in obtaining independent evidence of sobriety, they cannot frustrate such an effort through either affirmative acts or their rules and regulations. The sample was taken from Swanson as part of a standard inventory search. One of the purposes of inventory searches is the safekeeping of prisoners’ property. As the United States Supreme Court stated in Illinois v. Lafayette (1983), 462 U.S. 640, 103 S.Ct. 2605, 77 L.Ed.2d 65:

“A standardized procedure for making a list or inventory as soon as reasonable after reaching the stationhouse not only deters false claims but also inhibits theft or careless handling of articles taken from the arrested person.” (Emphasis added.)

Lafayette, 462 U.S. at 646, 103 S.Ct. at 2609.

Once the sample was taken from Swanson, the police had a duty to see to its safekeeping. The sample should have been refrigerated. Instead, it was left unrefrigerated for up to two days until the sample turned up in the police station and the arresting officer placed it in a refrigerator. This careless handling of the sample deprived Swanson of his due process right to gather possible exculpatory evidence.

We do not agree with the State’s argument that Swanson should have seen that the sample was properly cared for. Had he not been incarcerated and the sample taken from him we would find differently. However, he was deprived of the opportunity to care for the sample because of his incarceration. Once the authorities took control of the sample, shortly after it was drawn, they had a duty to properly care for it. This they did not do. Therefore, Swanson’s motion to dismiss should have been granted. Dismissal of the case with prejudice is the appropriate remedy because the State’s action precluded a fair trial by preventing Swanson from gathering exculpatory evidence.

Swanson also argues that he should have been advised of his right to post bail in lieu of incarceration. The offenses for which Swanson was arrested were offenses where a peace officer could accept cash bail, yet Swanson was not advised that he could have posted bail that night. Since we have already found a dismissal of the charges is appropriate, we need not address this issue.

We remand this case to the District Court with instructions to grant Swanson’s motion to dismiss.

MR. JUSTICES HARRISON, SHEEHY and MORRISON concur.

MR. JUSTICE WEBER,

dissenting:

I agree with the majority opinion when it holds that one accused of a crime involving intoxication has a right to obtain an independent blood test to establish his sobriety regardless of whether he submits to a police designated test. I do not agree with the balance of the opinion.

If the action of the State had established a clear interference with Mr. Swanson’s attempt to obtain exculpatory evidence, then I would agree with the majority. However, I believe a consideration of all of the facts requires a different conclusion.

I will review the pertinent facts, including portions which are mentioned in the majority opinion. On January 9, 1985, at 1:30 a.m., the defendant was stopped by the police and taken to the station. His father came to the station before the blood test was taken and indicated his willingness to pay for the blood test. The defendant was taken to the hospital at his request where the blood sample was drawn. From the hospital the defendant was transferred to the sheriff’s office. The arresting officer gave the blood sample to the defendant with the advice that it was the defendant’s sample, that he should send it in as soon as possible. The label on the sample stated “Keep Refrigerated.” During the booking process at the sheriff’s Office, the sample was placed on the counter in the booking room. We do not know if the sample was actually taken from the defendant, or was placed on the counter by the defendant. The only evidence establishes that when the officer left the booking room, he saw the sample on the counter.

Approximately 5 hours after the booking, defendant was taken before the Justice of the Peace on the morning of January 9. At that time bail was set. There is no indication that defendant made any request at that time with regard to the blood sample. Specifically there is no indication that he requested of the police or the Justice of the Peace that the blood sample be sent in. The defendant was released on his own recognizance on January 11. Again, there is no indication that the defendant made any inquiry with regard to the blood sample.

The arresting officer testified that he found the sample at the police station and put it in the refrigerator. He then called the defendant’s father and told him that somebody needed to get the sample and send it in for analysis. The defendant’s father testified that he received the call on January 12 and that the sample was picked up from the police station on January 13.

I agree with the conclusion of the majority that the police cannot frustrate the effort of an accused to obtain independent evidence of sobriety. I question that the evidence in this case indicates any such conduct. While I agree that it would have been appropriate for the police to have placed the sample in the refrigerator on the morning of January 9, we must balance this against the indifference on the part of the defendant as to the treatment of the sample. He made no request for refrigeration or sending in of the sample at the time of booking, or at the time of appearance before the Justice of the Peace, or at the time that he was discharged on January 11. The defendant’s disinterest suggests that he had concluded that he did not desire a test of his blood sample. The only reason that the matter came to the attention of anyone is that the officer was diligent when he observed the sample on January 12 at the police department. He then attended to the refrigeration and called the defendant’s father.

I agree with the conclusion that the police cannot interfere with the gathering of exculpatory evidence. In this case, the facts indicate a total lack of diligence or effort on the part of the defendant. I would not dismiss the case.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICE GULBRANDSON join in the foregoing dissent of MR. JUSTICE WEBER.


text:
    CLIFFORD GULLETT, Claimant/Respondent, v. STANLEY STRUCTURES, Employer, and Aetna Commercial Insurance Division, Defendant/Appellant.
    No. 86-049.
    Submitted on Briefs March 28, 1986.
    Decided July 25, 1986.
    722 P.2d 619.

      Poore, Roth and Robinson, C. Richard Anderson, Butte, for defendant/ appellant.
    Robert L. Kelleher, Billings, for claimant/respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Clifford Gullett’s employer, Stanley Structures, and its insurer, Aetna, appeal the Order of the Workers’ Compensation Court awarding attorney’s fees to Gullett’s counsel in the amount of $17,959.00 based upon an hourly fee of $125.00 per hour and a paralegal fee of $35.00 per hour. We affirm the Workers’ Compensation Court’s award.

The single issue presented by this appeal is whether the award of attorney’s fees was properly calculated under Section 39-71-614, MCA (1985).

The award of attorney’s fees arose in the context of litigation concerning the amount of permanent partial disability benefits to which Gullett was entitled. On April 23, 1985 the Workers’ Compensation Cotut filed its Findings of Fact, Conclusions of Law and Judgment awarding Gullett 480 weeks of permanent partial disability benefits at the rate of $93.07 per week. The Court also found that Gullett was entitled to an award of reasonable costs and attorney’s fees pursuant to Section 39-71-612, MCA. Consistent with the Order of the court, Gullett’s counsel submitted a record of the costs and of the hours compiled in preparing and trying the case, with supporting affidavits. Counsel also submitted the contingent fee contract between himself and his client, Gullett. Finally, counsel also submitted a Proposed Order specifying the amount of attorney’s fees claimed and including his customary and current hourly fee used to determine the amount. The calculation submitted by Gullett’s counsel included 150.8 hours of attorney work at $125.00 per hour ($17,612.50) and 9.90 hours of paralegal time at $35.00 per hour ($346.50) for a total of $17,959.00.

Aetna filed a motion opposing the proposed calculation of attorney’s fees to be awarded to Gullett’s counsel. Aetna argued that 150.8 hours of attorney time was an unreasonably high calculation for the nature of the case. Aetna further contended that $125.00 per hour was an unreasonably high hourly fee. Aetna urged the Workers’ Compensation Court not to award attorney’s fees based on this calculation which Aetna believed to be engineered to garner an award roughly equal to what Gullett’s counsel would have received if the court could have awarded fees based on the contingency contract between Gullett and his counsel.

On April 22, 1985, one day before the Workers’ Compensation Court issued its Findings of Facts and Conclusions of Law, a recent amendment to Section 39-71-614, MCA, went into effect. Previous to the amendment, contingency contracts could be considered by the court in awarding attorney’s fees. Wight v. Hughes Livestock Company, Inc. (Mont. 1983), [204 Mont. 98,] 664 P.2d 303, 40 St.Rep. 696. The statute, as amended, now states:

“(1) The amount of an attorney’s fee assessed against an employer or insurer under 39-71-611 or 39-71-612 must be based exclusively on the time spent by the attorney in representing the claimant on the issues brought before the workers’ compensation judge. The attorney must document the time spent and give the documentation to the judge. The judge shall determine a reasonable attorney fee and assess costs. He is not bound by the documentation submitted to him. The hourly fee the judge applies to the time spent must be based on the attorney’s customary and current hourly fee for legal work performed in this state.

“(2) This section does not restrict a claimant and an attorney from entering into a contingency fee arrangement under which the attorney receives a percentage of the amount of compensation payments received by the claimant because of the efforts of the attorney. However, an amount equal to any fee and costs assessed against an employer or insurer under 39-71-611 or 39-71-612 and this section must be deducted from the fee an attorney is entitled to from the claimant under a contingency fee arrangement.”

The statute clearly provides that award of attorney’s fees must be based on the hourly rate of the attorney and the hours expended. Gullett’s counsel submitted records and affidavits supporting the hours claimed and his fee. Aetna contends this fee impermissibly contains a factor to compensate for the risk involved in contingency situations, that is: losing the case and hence not being paid any fee. A more reasonable fee, Aetna argues, would be what it considers to be the common rate of $85.00 per hour.

We must note that the statute does not require that fee awards be based on an average rate of Montana attorneys, but rather awards must be based on the particular attorney’s customary hourly rate. How the individual attorney calculates what would be an adequate hourly rate to cover overhead, expenses and compensation is not of concern. There is substantial credible evidence in the record to support the lower court’s findings that:

“As to the reasonableness of the fee, all of the time that was spent by claimant’s counsel has been documented and is on file with this Court. Since the claimant prevailed on every issue except the 20 percent penalty, this Court cannot find that the time spent was unreasonable. Claimant’s attorney should be compensated for 150.8 hours of time. He should be paid at the rate he commands in the open market, which he reports to be $125/hour for his services and $35/ hour for his paralegal services. Claimant’s attorney fee is $17,959.”

The order of the Workers’ Compensation Court is affirmed.

MR. JUSTICES MORRISON, SHEEHY and HARRISON concur.

MR. JUSTICE WEBER,

dissenting:

I dissent from the majority opinion in its conclusion that there is substantial credible evidence to support the lower court’s determination of attorney’s fee.

Section 39-71-614, MCA, requires that an amount of an attorney’s fee must be based exclusively on the time spent. While the record supports the time determination of the Workers’ Compensation Court, I do not believe that the record meets the requirements of the last sentence of paragraph (1) of Section 39-71-614, MCA, which states:

“The hourly fee the judge applies to the time spent must be based on the attorney’s customary and current hourly fee for legal work performed in this state.”

The affidavit of Robert C. Kelleher, Sr., dated May 2, 1985, established that Robert E. Kelleher, Jr., passed the Montana and California bar exams in 1984, and detailed various experience which he had. In addition it stated the following:

“. . . that because all of the work of said OFFICE is on a contingent fee basis, an hourly rate has to be set on the basis of overhead, attorney’s skills, and the fact that occasionally a case is lost, resulting in the OFFICE absorbing not only lost attorney and staff salaries but invariably several thousand dollars in costs for medical exams, medical consultations, medical expert witness fees, vocational rehabilitation expert studies and attorney consultations, vocational rehabilitation expert witness fees, deposition charges, air plane fares, motel bills, long distance telephone calls, copying, etc.; that the hourly rate of Robert L. Kelleher, Jr., has a value of $125.” The statement that the hourly rate has a value of $125 does not meet the statutory requirement that the hourly fee which the judge applies must be based upon the attorney’s “customary and current hourly fee for legal work performed in this state.” It may well be that this deficiency resulted in part from the recent amendment to Section 39-71-614, MCA, which took effect one day prior to the findings of fact and conclusions of the court.

In addition, I conclude that the affidavits submitted by the attorneys for the insurance company are not satisfactory because they set forth the customary and current hourly fee for defense legal work which may be significantly different than plaintiffs work in this type of case.

I would therefore reverse the determination by the Workers’ Compensation Court and remand the case with instructions for a redetermination of the fee in accordance with the provisions of the statute.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICE GULBRANDSON join in the foregoing dissent of MR. JUSTICE WEBER.


author: PER CURIAM:

text:
    In re the MARRIAGE OF MARILYN JOY COLE, Petitioner, and JAMES W. COLE, Respondent.
    July 29, 1986.
    722 P.2d 624.
   ORDER AND OPINION

PER CURIAM:

A Motion for Disqualification of Judge and an Affidavit in support thereof was filed in Hill County District Court Cause No. DR-85-210, entitled “In Re the Marriage of Marilyn Joy Cole, Petitioner, and James W. Cole, Respondent,” on May 1, 1986. The Court has examined and considered the same.

It appears from the affidavit filed by respondent that a pretrial settlement conference was conducted in this matter on October 25, 1985, which was attended by both parties, their counsel and the District Judge. Thereafter, on January 30 and 31, 1986, trial was had before the District Judge sitting without a jury. On February 5, 1986, the District Court entered its findings of fact and conclusions of law, and on February 18, 1986, a decree of dissolution was entered. Respondent filed a notice of appeal on March 28, 1986.

In his affidavit filed on May 1, 1986, in support of the motion for disqualification of judge, respondent alleges that statements made by the District Judge at the pretrial settlement conference on October 25, 1985, leads him to believe that the judge has a personal bias and prejudice against him.

Section 3-1-802, MCA, provides in pertinent part:

“Whenever a party to any proceeding in any court makes and files a timely and sufficient affidavit that a judge before whom the matter is pending has a personal bias or prejudice either against him or in favor of any adverse party, such judge shall proceed no further therein.

“In the case of a district judge, another district judge shall be assigned by the chief justice of the Supreme Court to hear such disqualification proceedings . . . The affidavit shall state the facts and the reasons for the belief that bias or prejudice exists, and shall be filed not less than twenty days before the original date of trial, or good cause shall be shown for failure to file it within such time . . . .” [Emphasis added.]

In reviewing the motion for disqualification and the brief and affidavit in support thereof, we find no statement therein showing good cause for respondent’s failure to file the motion in a timely manner as required by Section 3-1-802, MCA.

Respondent also argues in his motion that the District Judge should disqualify himself pursuant to this Court’s opinion in Shields v. Thunem (Mont. 1986), [220 Mont. 449,] 716 P.2d 217, 43 St.Rep. 518. We note that in Shields, the judge was asked to “step down” before trial began. Here, respondent is asking the District Judge to disqualify himself three months after trial and after judgment had been entered.

IT IS ORDERED:

The motion for disqualification of judge in Hill County Cause No. DR-85-210 is denied on the grounds that the motion was not timely filed and no good cause has been shown for failure to make a timely motion.

The Clerk is directed to mail a true copy hereof to counsel of record for the respective parties, to the Clerk of the District Court of Hill County, and to the Honorable Leonard H. Langen, District Judge.

DATED this 29th day of July, 1986.

s/J.A. Turnage, Chief Justice

s/Fred J. Weber, Justice

s/Frank B. Morrison, Justice

s/John C. Sheehy, Justice

s/L.C. Gulbrandson, Justice

s/William E. Hunt, Justice


author: MR. CHIEF JUSTICE TURNAGE

text:
    CLYDE R. BOEHM, Jr., Plaintiff and Appellant, v. ALANON CLUB, Defendant and Respondent.
    No. 85-533.
    Submitted on Briefs March 13, 1986.
    Decided July 29, 1986.
    722 P.2d 1160.

      Nye & Meyer, Jerrold L. Nye, Billings, for plaintiff and appellant.
    Peterson, Schofield & Leckie, V. Joe Leckie, Billings, for defendant and respondent.
   MR. CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Clyde Boehm filed a complaint against his former employer, Ala-non Club, in the District Court of the Thirteenth Judicial District of the State of Montana, in and for the County of Yellowstone. The court granted defendant’s motion for a directed verdict in its favor on Count I of the complaint, and Boehm has appealed. For the reasons stated below, we reverse and remand for a new trial.

Clyde Boehm, appellant, brought suit for damages he received as a result of falling on the property of the respondent, 204 Grand Ala-non Club, Inc. (Club). In the second count of the complaint, Boehm claimed damages for wrongful termination from his employment with the Club subsequent to his fall. At the close of plaintiff’s case, the Club moved for a directed verdict on both counts. The court granted the motion as to Count I, but denied it as to Count II. Subsequently, the jury found in favor of Boehm on the wrongful termination claim, and neither party has appealed that finding.

Boehm was hired by the Club as a steward in August 1983. His duties included paying the bills, collecting club dues, purchasing and serving snacks and coffee, and cleaning and maintaining the premises. He was paid $100 per week and was allowed to live at the Club.

The accident occurred on the morning of January 3, 1984, while Boehm was still an employee of the Club. It had been raining and snowing that morning from around 8:30 to 11:00. Sometime before 9:00 or 10:00 that morning, Boehm shoveled off the sidewalk leading from the street to the main entrance of the Club and put down a melting agent on the sidewalk to keep the ice melted. Additionally, there was a build-up of ice and snow on both sides of the sidewalk which caused water to run down the sidewalk. Sometime that morning, Boehm returned to the Club after going to the bank and running other errands. As he was walking up the sidewalk, he slipped on some ice and fell, breaking his leg in two places.

Boehm filed a claim under workers’ compensation but was denied recovery because the Club did not have workers’ compensation insurance, in violation of Section 39-71-401, MCA. Boehm then brought an action for damages against the Club which is the subject of this appeal.

Appellant has raised two issues on appeal:

1. In an action for damages against an uninsured employer brought pursuant to Section 39-71-508, MCA, must the employee prove negligence or breach of duty by the employer in order to recover?

2. Under the facts established at trial, did the court err in granting respondent’s motion for a directed verdict?

I

Appellant brought suit against respondent pursuant to Section 39-71-508, MCA (1983). This statute allows an employee to maintain a damage action against his employer for injuries arising out of and in the course of employment. However, only employers who are uninsured, as defined by Section 39-71-501, MCA, are subject to such an action. Appellant contends that he should not be required to prove negligence or breach of duty by the employer in order to recover under Section 39-71-508. Rather, he seems to assert that because of the theory behind workers’ compensation and the policy of construing statutes liberally in favor of the worker, he only needs to show he was injured on the job in order to recover damages for his injuries. We cannot agree with this proposition.

Section 39-71-508, MCA (1983), provides in pertinent part:

“An employee who suffers an injury arising out of and in the course of employment while working for an uninsured employer as defined in 39-71-501 . . . may elect to either receive benefits from the uninsured employers’ fund or pursue a damage action against the employer . . . .”

[This statute was amended after appellant was injured.] We hold that the words “damage action,” as used in the statute, implies that an employee must prove some fault or breach of duty by the uninsured employer before the employee can recover for his injuries. Normally, the action will be one in negligence; however, negligence is not the only theory of liability encompassed by the statute. Strict or vicarious liability may also apply in appropriate situations.

The only other Montana case to consider this issue held that negligence must be shown in order for an employee to recover for his injuries against an uninsured employer. Chancellor v. Hines Motor Supply Co. (1937), 104 Mont. 603, 69 P.2d 764. Furthermore, case law from other states supports the view that an employee must affirmatively show some fault or breach of duty by the uninsured employer before recovery is allowed.

In Arvas v. Feather’s Jewelers (N.M. 1978), 582 P.2d 1302, an employee was injured in the course and scope of his employment with an uninsured employer. New Mexico has a statute which allows an employee to maintain an action for “damages” against an uninsured employer, and the employee brought suit against her employer pursuant to this statute. Although the employee did not contend that she did not have to prove negligence in order to recover, in upholding the judgment for the employee the court assumed that ordinary principles of negligence applied.

The same approach was taken by the Supreme Court of West Virginia in Bates v. Sirk (1976), 159 W.Va. 917, 230 S.E.2d 738. In language relevant to Boehm’s contention, the court stated:

“It is readily admitted by the plaintiff that it is not enough for him to show that he suffered injuries and that the defendant failed to subscribe to the workmen’s compensation fund. He acknowledges that before such a case warrants jury consideration he must make a prima facie showing of negligence on the part of the defendant which was the proximate cause of his injuries.” [Emphasis added.]

Bates, 230 S.E. 2d at 741.

Therefore, case law from other states and a plain reading of the statute supports our holding that in a damage action under Section 39-71-508, MCA, an employee must make out a prima facie case of breach of duty by the employer before he can recover for his injuries.

Subsequent to appellant’s accident, the legislature amended Section 39-71-508, MCA, and enacted Section 39-71-515, MCA, to close a gap that existed earlier. Unlike the old statute, the amended statute allows an employee to file a claim for benefits from the uninsured employers’ fund and pursue a damage action against the uninsured employer at the same time without having to make an election. Furthermore, Section 39-71-515 gives an employee an independent cause of action against an uninsured employer by imposing liability simply on the basis of the failure of the employer to be enrolled in a workers’ compensation plan on the date of injury. Appellant contends that these amendments apply to his case because they were designed to remedy deficiencies in the prior law and are, therefore, remedial rather than substantive.

The guiding principle in this area is Section 1-2-109, MCA, which states: “No law contained in any of the statutes of Montana is retroactive unless expressly so declared.” However, it has been held that where a statute is procedural, rather than substantive, Section 1-2-109 has no application, and the statute will be applied to a cause of action arising before its enactment. State v. District Court of Fourth Judicial District (1966), 148 Mont. 22, 417 P.2d 109. Therefore, we must determine whether the amendment to Section 39-71-508 and the enactment of Section 39-71-515 are procedural or remedial, as appellant contends, or whether they are substantive.

The general definition of a substantive or retrospective law has been summarized as follows:

“A retrospective law, in the legal sense, is one which takes away or impairs vested rights acquired under existing laws, or creates a new obligation and imposes a new duty, or attaches a new disability, in respect to transactions or considerations already past.”

73 Am.Jur.2d Statutes, Section 348 (1974). Similarly, this Court held that “[a] substantive law may be defined as that law which creates duties, rights, obligations, and responsibilities.” Dunham v. Southside National Bank of Missoula (1976), 169 Mont. 466, 472, 548 P.2d 1383, 1386.

Appellant contends that the intent of the legislature was to remedy the defects that existed in Section 39-71-508 so that an uninsured employer would not be able to completely escape liability. That may be true; however, that does not mean the amendment is remedial. This statute, as amended, in addition to Section 39-71-515, imposes a new liability or obligation upon uninsured employers that did not exist prior to their enactment. Furthermore, the statutes grant employees a new cause of action or right that did not exist prior to their enactment. Were we to allow appellant the benefit of these newly-enacted statutes, respondent would be subjected to a completely new and wholly independent liability from the one that existed under the statutes in effect at the time of appellant’s injury. This result fits exactly within the definition of a substantive law. Thus, to apply the amended statute to appellant’s cause of action would be to give it retroactive effect.

A substantive law may be applied retroactively only when expressly so declared or intended by the legislature. Penrod v. Hoskinson, M.D. (1976), 170 Mont. 277, 552 P.2d 325. Dunham, supra. There is no indication in Section 39-71-508 nor in Section 39-71-515 that the legislature intended these statutes to apply to injuries arising before their enactment. Had the legislature intended such a result, it could have easily indicated it in the statutes. Therefore, since appellant’s injury occurred before the enactment of the statutes in question, his case is governed by the prior law. This holding is consistent with other cases in this area holding that “workers’ compensation benefits to an injured worker are determined by the statutes in effect at the time of the injury.” Iverson v. Argonaut Insurance Company (Mont. 1982), [198 Mont. 340,] 645 P.2d 1366, 1367. 39 St.Rep. 1040, 1041; Trusty v. Consolidated Freightways (Mont. 1984), [210 Mont. 148,] 681 P.2d 1085, 41 St.Rep. 973.

II

Appellant contends next that it was error for the District Court to enter a directed verdict in the respondent’s favor. A directed verdict is proper only “[w]here, upon the trial of an issue by a jury, the case presents only questions of law . . .” Section 25-7-302, MCA. Elaborating on this rule, the Court in Sant v. Baril (1977), 173 Mont. 14, 20-21, 566 P.2d 48, 51, set forth the basic test to be applied in determining whether a directed verdict is proper:

“Case authority in Montana has established three basic rules which apply in interpreting section 93-5205 [now Section 25-7-302, MCA].

“1. Upon a motion for directed verdict in favor of defendant, the evidence introduced by plaintiff will be considered in the light most favorable to plaintiff and as providing whatever it tends to prove.

“2. A cause should never be withdrawn from the jury unless the conclusion sought to be drawn from the facts must follow as a matter of law and recovery cannot be had upon any view which could be reasonably drawn from the facts which the evidence tends to prove.

“3. In reviewing an order directing a verdict for defendant, the reviewing court will only consider the evidence introduced by the plaintiff and if that evidence, viewed in the light most favorable to the plaintiff, tends to establish the case made by the plaintiff’s pleading the order will be reversed.

“The test commonly employed to determine if the evidence is legally sufficient to withdraw cases and issues from the jury is whether reasonable men could draw different conclusions from the evidence.” We must consider the propriety of the directed verdict with these principles as our guide.

The District Court felt that the cases of Luebeck v. Safeway Stores, Inc. (1968), 152 Mont. 88, 446 P.2d 921, and Uhl v. Abrahams (1972), 160 Mont. 426, 503 P.2d 26, control the law to be applied in this case. Luebeck, and later Uhl, set forth the general rule which is applied in actions involving injuries caused by falling on ice or snow. In Luebeck, the plaintiff was injured when she fell on defendant’s snow-covered lot. The Court held:

“[W]here danger created by the elements such as the forming of ice and the falling of snow are universally known, or as here, actually known, there is no liability.” [Emphasis added.]

Luebeck, 446 P.2d at 924.

Similarly, in Uhl, the plaintiff was injured when she fell in defendant’s parking lot which was covered with frozen rain. The Court found that the plaintiff “specifically knew from observation immediately prior to getting out of the car that the parking lot and walkway were covered with ice. She recognized the condition as dangerous and knew that she had to be careful or she might fall down.” Uhl, 503 P.2d at 28. Although the defendant had used a de-icer on the parking lot that morning to try to melt the ice, the Court held that “[t]here is no evidence that the use of the de-icer on the walkway contributed to the slippery condition. In short, nothing but a natural icing condition due to the elements was involved and such condition prevailed throughout the city.” Uhl, 503 P.2d at 28.

Thus, both of these cases involved situations where there was a natural accumulation of snow or ice, and the defendant had done nothing to alter this condition. However, there is a separate line of cases in this area which the court failed to give proper consideration to. Those cases hold that a property owner may be held liable for injuries occurring on his property due to ice or snow where he has altered the natural conditions in some way. Cerek v. Albertson’s Inc. 1981, 195 Mont. 409, 637 P.2d 509, 38 St.Rep. 1986, represents the latest statement from the Court on this point.

In Cereck, the plaintiff was injured when she attempted to cross over a snowbank that had been created on defendant’s property. The defendant plowed a passageway in the snow leading from the parking lot to the store entrance which created a snowbank along the passageway. The plaintiff had attempted to cross over the snowbank in order to avoid a large puddle of water that had formed in the passageway. In reversing the lower court’s grant of summary judgment in defendant’s favor, this Court held:

“A property owner may be held liable for falls on accumulations of ice and snow where the hazard created by the natural accumulation is increased or a new hazard is created by an affirmative action of the property owner; even where such a condition is actually known or obvious, a property owner may be held liable if he should have anticipated that injuries would result from the dangerous condition.

“In this case it may reasonably be inferred that the piling of snow in front of the store entrance increased the hazard created by the natural accumulation of snow and ice and that the defendants should have anticipated the injuries that Mrs. Cerek received as a result of the dangerous condition.”

Cerek, 637 P.2d at 511-512. In reaching this result, the Court specifically distinguished Lubeck by finding that the natural accumulation of ice and snow had been altered.

Cereck is firmly supported by Willis v. St. Peter’s Hospital (1971), 157 Mont. 417, 486 P.2d 593. There, a patrolman was injured when he slipped on the pavement at the emergency entrance to the hospital. The maintenance crew at the hospital had been keeping the entrance free from snow and ice by plowing and using a chemical deicer. In reversing a directed verdict for the defendant, the Court held that “the evidence presented raises a jury question as to whether the slippery snow and ice pack at the emergency entrance was the result of a natural accumulation or the careless use of the deicer chemical used.” Willis, 486 P.2d at 595.

We find that Cereck and Willis state the applicable law in the present case. Appellant testified that he shoveled the sidewalk daily and used a de-icer the morning he was injured. The combination of the build-up of snow and ice on both sides of the sidewalk and the possible careless use of the chemical de-icer could have increased the hazard created by the natural accumulation of snow and ice. Furthermore, the possible careless use of the de-icer may have created a hazard or condition completely different from the natural accumulation. Unlike the plaintiffs in Luebeck and Uhl, there was no evidence that appellant knew the sidewalk was slippery or had spots of ice on it, nor was there any evidence that this condition was obvious. In fact, it appears that appellant did not recognize the condition of the sidewalk as being dangerous. The fact that appellant was the only person to testify to these conditions is immaterial because on a motion for a directed verdict, the evidence must be considered “in the light most favorable to plaintiff and as proving whatever it tends to prove.” Sant, 566 P.2d at 51.

Therefore, reasonable minds could draw different conclusions on the question of whether the hazard created by the natural accumulation of snow and ice was increased or altered by daily shoveling of the snow and by appellant’s possible carelessness in using the de-icer on the sidewalk. Considering the evidence in the light most favorable to appellant, we cannot find that respondent is entitled to judgment as a matter of law. We hold that a jury question was presented on the issue of whether respondent used ordinary care to have the premises reasonably safe for persons coming on its property.

Reversed and remanded for a new trial.

MR. JUSTICES HARRISON, MORRISON, SHEEHY and WEBER concur.


author: MR. JUSTICE WEBER

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. JERRY LATTIN, Defendant and Appellant.
    No. 86-145.
    Submitted on Briefs May 30, 1986.
    Decided July 29, 1986.
    722 P.2d 622.
    John Keith, Great Falls, for defendant and appellant.
    Mike Greely, Atty. Gen., Dorothy McCarter, Asst. Atty. Gen., Helena, Patrick L. Paul, Cascade County Atty., Great Falls, Antonia P. Marra, Deputy, for plaintiff and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

Defendant Mr. Lattin appeals his criminal sentencing by Cascade County District Judge Thomas McKittrick, whom he had moved to disqualify. We affirm.

The issue is whether Judge McKittrick erred in assuming initial jurisdiction over the motion to disqualify and in denying that motion.

Mr. Lattin was charged with sexual assault upon his minor stepdaughter. On the date originally set for trial, he entered a guilty plea. Judge McKittrick ordered a pre-sentence investigation, revoked Mr. Lattin’s bail, and set a sentencing date for the following month.

At his sentencing hearing, Mr. Lattin filed a motion to disqualify Judge McKittrick. The affidavit in support of the motion alleged bias or prejudice against Mr. Lattin, demonstrated in a discussion prior to the sentencing hearing, in which Judge McKittrick allegedly told Channing Hartelius, an attorney, that Mr. Lattin would receive a jail sentence. Although it was not required to do so, the court allowed evidence in support of the motion. Mr. Hartelius testified that about a month previously he had approached Judge McKittrick, at Mr. Lattin’s request, about releasing Mr. Lattin on bail pending sentencing. He testified that Judge McKittrick had stated that “under the circumstances of this situation, that there would probably be some jail time.”

The motion for disqualification was denied. Judge McKittrick found it was not timely filed, no cause was shown for failure to timely file, and the supporting affidavit did not allege a personal bias or prejudice. Mr. Lattin argues that Judge McKittrick erred in proceeding with the sentencing after the filing of the motion for disqualification.

Section 3-1-802, MCA, provides in pertinent part:

“Whenever a party to any proceeding in any court makes and files a timely and sufficient affidavit that a judge before whom the matter is pending has a personal bias or prejudice either against him or in favor of any adverse party, such judge shall proceed no further therein.

“In the case of a district judge, another district judge shall be assigned by the chief justice of the Supreme Court to hear such disqualification proceedings . . . The affidavit shall state the facts and the reasons for the belief that bias or prejudice exists, and shall be filed not less than twenty days before the original date of trial, or good cause shall be shown for failure to file it within such time. It shall be accompanied by a certificate of counsel of record stating that it has been made in good faith.”

Mr. Lattin argues that once-his motion for disqualification and supporting affidavit were filed, Judge McKittrick had no further jurisdiction over this case. He cites State v. Duncan (Mont. 1981), 623 P.2d 953, 954, 38 St.Rep. 202, 204, in which this Court held that once a motion for disqualification of a district judge is made, the case comes “under the singular authority and jurisdiction of this Court.” That case was decided under former Section 3-1-801, MCA, (1981), which was substantially the same as the current law. Mr. Lattin also cites the holding from In re Marriage of Gahr (Mont. 1984), [212 Mont. 481,] 689 P.2d 257, 259, 41 St.Rep. 1879, 1881-82:

“In all judicial proceedings, a judge may be disqualified for actual bias on the filing of an affidavit supporting that allegation. Upon receipt of such an affidavit, the presiding judge may do no more than to refer the matter to the Chief Justice, who, if the affidavit warrants an inquiry, will appoint another judge to hear the matter.”

However, this Court has affirmed a district court’s denial of an untimely motion for disqualification of a judge for cause. State v. Harvey (Mont. 1986), [219 Mont. 403,] 713 P.2d 517, 43 St.Rep. 46. The statute, by its terms, provides that a district court shall proceed no further wherever a timely and sufficient affidavit of bias or prejudice is filed. The timeliness of the affidavit is an initial matter for the district court to determine.

Mr. Lattin’s January 22, 1986 motion to disqualify Judge Mc-Kittrick was filed later than the statutory 20 days before the December 9, 1985 original date of trial. He must show good cause for failure to timely file. The affidavit in support of the motion for disqualification does not give any reason for Mr. Lattin’s failure to timely file the motion and affidavit. When the court allowed Mr. Lattin to present evidence in support of the motion, Mr. Hartelius testified that his conversation with Judge McKittrick had occurred “probably a month” before the sentencing hearing. The month-long delay in filing the motion and affidavit was not explained. We hold that Judge McKittrick properly found that the motion was not timely filed and good cause was not shown for failure to timely file the motion and affidavit.

We affirm.

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


author: MR. JUSTICE HUNT

text:
    PEARL F. WAGNER, Plaintiff and Appellant, v. GLASGOW LIVESTOCK SALES CO., a Montana corporation, and Treasure State Bank, a Montana corporation, Defendants and Respondents.
    No. 86-62.
    Submitted on Briefs May 15, 1986.
    Decided July 30, 1986.
    722 P.2d 1165.

      David L. Nielsen, Glasgow, for plaintiff and appellant.
    Matthew W. Knierim, Glasgow, for defendants and respondents.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

This is an appeal from an order granting summary judgment. Pearl Wagner brought an action against the Glasgow Livestock Sales Company and Treasure State Bank to decide: (1) Whether the security agreement between Wagner and the Treasure State Bank created a valid security interest in the collateral described; (2) Whether an advance made on November 3, 1980 to Wagner’s husband and their ranch was secured by the security agreement; and, (3) Whether Glasgow Livestock Sales Company was liable to Wagner for proceeds of the sale of her cattle which were paid directly to Treasure State Bank rather than to Wagner herself.

The District Court granted summary judgment to the respondents, Treasure State Bank and Glasgow Livestock Sales, Co. and we affirm.

The issue before us is whether the summary judgment should have been granted.

Early in February of 1980, Pearl and Richard Wagner entered into an agreement with Treasure State Bank in which all their farm equipment, livestock, products and proceeds thereof were listed as security for “the payment and performance of each and every debt, liability and obligation of every type and description” the Wagners owed or at any time thereafter would owe to Treasure State Bank. The provisions of this agreement will be cited as needed. At the time this agreement was entered the Wagners owed the bank $86,000.00.

On March 24, 1980, the Wagners both signed a promissory note in the amount of $120,000.00 which represented their operating line of credit for that year. The language of this note indicated it was secured by a security agreement dated March 24, 1980. During the following period the bank made many advances on this line of credit and the Wagners deposited funds to be credited against this line of credit. Richard Wagner, individually, and for the ranch, signed an additional promissory note on November 3, 1980 in the amount of $170,000.00.

On January 12, 1981, Pearl Wagner wrote to the president of the Treasure State Bank informing him that she and Richard had separated in December of the preceding year. She emphasized that as of the date of her letter she would no longer be responsible for any debts Richard Wagner might incur. Pearl and Richard Wagner have since divorced.

Thereafter Pearl Wagner made a number of sales of cattle. The proceeds of three of these sales are the subject of this suit. In January of 1981 she sold cattle through the Glasgow Livestock Sales Company for the sum of $3,244.07. In March of 1981 she again sold cattle through Glasgow Livestock, this time for $120,515.78. In both instances the livestock company made the checks out to Pearl Wagner and Treasure State Bank. The second and larger check included Richard Wagner as payee. When she presented these checks Pearl was told that payment on them had been stopped. In each instance these sums were then directed from the livestock company to the bank, where they were credited against the balance of the March and December 1980 notes. The final cattle sale concerned three bulls Pearl Wagner bought from another rancher and consigned the same day to the livestock company for sale. After the bulls were sold, the livestock company paid the proceeds directly to the Treasure State Bank. The bank applied the proceeds against the balance due on the two notes. Pearl Wagner brought this suit against Treasure State Bank and Glasgow Livestock Sales Company alleging that because she was not personally liable on the November 1980 note, and because the security agreement of February 24, 1980 did not cover the November note, the bank and livestock company are liable to her for the proceeds of those sales.

We are first asked to determine whether, under the facts of this case, summary judgment was proper. The law favors full litigation of all issues brought before a court. The narrow exception of summary judgment exists for reasons of judicial economy. Hence summary judgment is proper only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Cereck v. Albertson’s, Inc. (Mont. 1981), 195 Mont. 409, 637 P.2d 509, 38 St.Rep. 1986. The burden of establishing the absence of any genuine issue of material fact falls upon the moving party. Once established in the record that no issue of fact exists, the burden shifts to the party opposing the motion to demonstrate such issues do exist. Rumph v. Dale Edwards, Inc. (1979), 183 Mont. 359, 600 P.2d 163. If the opposing party cannot display material fact issues to the court or that the law requires the issue to be determined against the moving party, summary judgment must be granted. Larry C. Iverson, Inc. v. Bouma (Mont. 1981), 195 Mont. 351, 639 P.2d 47, 38 St.Rep. 1911.

In the case before us, Wagner has failed to establish any differences concerning the material facts of the case. While the circumstances surrounding the making of the security agreement and the promissory notes, the crediting and debiting Wagner’s line of credit, and the sales of cattle and payment of proceeds from those sales may be factually complicated, Wagner has not produced evidence of any material issue concerning these facts. Merely conclusory or speculative statements asserting issues of fact are not sufficient to resist the motion. Kronen v. Richter (Mont. 1984), [211 Mont. 208,] 683 P.2d 1315, 41 St.Rep. 1312. The party opposing the motion has an affirmative duty to respond by affidavits or sworn testimony with specific facts to show there is a genuine issue suitable for trial. B.M. by Berger v. State of Montana (Mont. 1985), [215 Mont. 175,] 698 P.2d 399, 42 St.Rep. 272.

Close examination of the record, including the affidavit of Pearl Wagner, convinces us that the trial court properly found that no issue of material fact existed. Wagner contends that she didn’t intend at the time of signing the security agreement that it would cover any separate note signed by her husband only. It is true that summary judgment is usually inappropriate where intent of the parties is an important consideration. Twite v. First Bank (Mont. 1984), [214 Mont. 348,] 692 P.2d 421, 41 St.Rep. 2518. However, in this case the security agreement as we explain below, was a valid agreement, not ambiguous, and clearly covering future indebtedness, whether joint or several, and clearly pledging Pearl Wagner’s separate property (cattle with her brand) for the whole indebtedness. Therefore evidence of Pearl Wagner’s subjective intent is not a material issue. The four corners of the security agreement clearly show the obligations and rights arising from the agreement.

The only other issue of fact raised by the record concerns the problem that the March 24, 1980 promissory note refers to a security agreement dated the same day. Pearl Wagner has not alleged the existence of any agreement signed that day and admits she signed the February agreement which the bank contends secures that March note. The District Court found that the March 24 date for the referenced security agreement was a typing error. This finding was proper considering Pearl Wagner has not raised any fact tending to show the existence of any security agreement other than the February agreement.

Holding, as we do, that there is no material issue of fact, we turn now to whether the respondents were entitled to summary judgment as a matter of law.

The first question raised by Wagner concerns the enforceability of the security agreement. A security interest is enforceable if it is in writing and sets forth a description of the collateral and the debtor rights in the collateral. It must be signed, and consideration must be given by the secured party for the interest. Section 30-9-203, MCA. All these requirements have been met by the security agreement concerned. It is in writing, describes the property as all equipment, cattle branded C7 — R.H. C7 — L.H. and R.H. and all proceeds thereof. There is no contention that Pearl Wagner was not the owner of these properties. The agreement is signed by Pearl Wagner. Finally, value given by the bank, is represented by the prior $84,000 indebtedness and by the promissory notes issued in March and December. Once all these requirements are met, the security agreement “attaches” and is enforceable against the debtor. Section 30-9-203, MCA. Hence we hold the agreement entered by Pearl Wagner on February 6, 1980 created an enforceable security interest held by the Treasure State Bank.

The terms of the security agreement clearly indicate the collateral would secure joint and single liability of Pearl and Richard Wagner. The agreement states: “To secure the payment and performance of each and every debt . . . whether it is or may be . . . joint, several, [or] joint and several . . . .”

Pearl Wagner did not notify the bank until January 12, 1981, that she no longer considered herself or her property liable for her husband’s debts. She has raised no issue of fact or legal basis on which the District Court could deny summary judgment on the issue of her cattle’s status as security for the note Richard signed November 2, 1980. She may not be personally liable on the underlying debt. Section 40-2-301 and 302, MCA. However, her property remains as collateral for that debt under the security agreement which she signed.

Finally, appellant Wagner contends that the Glasgow Livestock Sales Company was legally obligated to pay the proceeds of the sale of her cattle to her and the Treasure State Bank rather than directly to the bank. Originally the first two checks were made out jointly but payment on those checks was stopped and the proceeds paid directly to the bank. Payment from the final sale was made directly to the bank.

The terms of the security agreement and the applicable statutes allow the livestock company to pay the bank directly. First, the security agreement contains this provision:

“A Secured Party, may, at anytime (both before and after the occurrence of an Event of Default) notify any account debtor or any other person obligated to pay any amount due, that such . . . right to payment has been assigned or transferred to Secured Party for security and shall be paid to Secured Party.”

The provision further provides that the debtor will notify the obligor of the assignment and the secured party could then demand payment. This kind of provision is expressly provided for in security agreements. Section 39-9-502, MCA. Furthermore the facts indicate Richard Wagner, himself, put the stop payment on the second check and brought in the payment to be applied directly on the outstanding debt.

The bank did not perfect by filing a financing statement concerning the security interest until March 2, 1981. The first sale where proceeds were sent directly to the bank occurred prior to the perfection of that security interest. Even the payment, however was proper. Independent of the terms of the agreement or the rules of Montana’s commercial code, some of the provisions of the Livestock code apply and even control the other applicable statutes. See Section 30-9-203(4), MCA. Section 81-8-301(1), MCA, one of the controlling statutes, provides:

“A livestock market to which livestock is shipped may not be held liable to any secured party for the proceeds of livestock sold through the livestock market by the debtor unless notice of the security agreement is filed and a copy is transferred as hereinbefore provided.”

The inverse implication of this section is that the livestock market would be liable if the notice had been filed and the proceeds were paid to the debtor. The proceeds of the first sale were paid before the Treasure State Bank had filed such a notice. However, the District Court found from the deposition of Robert Fjeldheim, President and General Manager of Glasgow Livestock Sales, Co., that the Wagners themselves informed the sales company that the bank had a security interest in their cattle. Prior to the second sale the bank filed a notice concerning the security interest created in Wagner’s cattle and the Glasgow Livestock Sales Company had received a copy. Therefore the market was obligated to pay the bank for the second sale.

The situation is complicated somewhat by the fact that the security interest enforced in the last sale was one created in cattle owned by another debtor of the Treasure State Bank. These cattle were bought by Pearl Wagner and consigned to Glasgow Livestock Sales Company on the same day. There is no evidence in the record that this security agreement did not contain the exact provision which allowed the bank to demand payment. Furthermore a notice of the security interest in these cattle was also on file with the livestock company. Therefore Section 81-8-301(1), MCA, required the livestock company to pay the bank the proceeds.

We conclude that there is no issue of material fact or interpretation of law which precludes the summary judgment granted by the District Court. The judgment and order of the District Court are affirmed.

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


author: MR. JUSTICE SHEEHY

text:
    CONSTANTINE PROTO, d/b/a Fur Boutique, Plaintiff and Appellant, v. JAMES ELLIOT and Azra Stinger, Defendants and Respondents.
    No. 85-511.
    Submitted on Briefs June 20, 1986.
    Decided July 31, 1986.
    722 P.2d 625.

      Goldman & Goldman, Terry Sehestedt, Missoula, for plaintiff and appellant.
    Sherwood & Englund, Michael J. Sherwood, Missoula, for defendants and respondents.
   MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

Appellant, Constantine Proto, appeals from the judgment of the District Court, Fourth Judicial District, County of Missoula, awarding respondent, Azra Stinger, $3,500.00 together with costs and attorney fees.

In 1980, Proto and Stinger, together with their respective spouses, formed a corporation with each family owning half of the corporate shares. The principal business activity of the corporation was the operation of a fur business in Missoula, Montana, known as the Fur Boutique. Proto and Stinger conducted the day-to-day operation of the business.

The parties’ business was not a particular success financially. The relationship between Proto and Stinger deteriorated with Proto openly critical of Stinger’s performance. In December, 1981, Stinger told Proto she was thinking of leaving the business. The parties initially were unable to arrive at acceptable terms for Proto’s purchase of Stinger’s interest in the business. Stinger eventually withdrew all the cash from the business bank account, changed the locks on the business premises and removed her personal property from the business. Ultimately, on March 24, 1982, the parties entered an agreement which called for transfer of Stinger’s shares in the corporation to Proto in exchange for specified items from the business’ inventory. Stinger promptly obtained all of the inventory items she was entitled to as payment under the agreement. Proto continued the operation of the business through the date of trial.

This action was initiated by Proto filing a complaint against Stinger and James Elliot, Stinger’s son-in-law, in the Missoula County Justice Court to recover damages in the sum of $2,550.00 for the conversion of a fur blower and a rug. With regard to the rug the parties told Elliot that he could take a piece of carpet that came with the rented business premises for his own use. The parties disagreed at trial as to whether the carpet was loaned or given to Elliot. Regardless, the carpet was not returned when Proto demanded its return. As to the fur blower, the record discloses that it was owned by either Proto or his mother and was used in the business. At some point Stinger took the blower to a repair shop and did not return it. There was conflicting testimony as to whether Proto knew how to reclaim the blower. Eventually, Stinger reclaimed the blower by paying the repair bill of $11.00. Stinger had possession of the blower at the time of trial.

Both Stinger and Elliot answered Proto’s complaint and Stinger counterclaimed for damages for intentional infliction of mental distress, breach of contract and specific performance of the terms and conditions of the parties buy-out contract. The Justice Court entered judgment dismissing Proto’s complaint, awarding damages and attorney fees to Stinger and Elliot, and ordering Proto to perform the contract. Proto then appealed to the District Court.

The cause was tried to the District Court sitting without a jury. The District Court dismissed Proto’s complaint and entered judgment requiring Stinger to return the fur blower to Proto upon payment of the $11.00 repair bill by Proto, awarding Stinger $3,489.00 in damages for intentional infliction of mental distress, and awarding Stinger $1,559.00 in attorney fees.

With regard to Stinger’s counterclaim for damages for intentional infliction of mental distress, the record discloses that while both parties were involved in the business, Proto was often critical of Stinger and on a daily basis made remarks such as: “I’m going to sue, you’re no good, why don’t you go home, let me run the store, you can’t do anything, you don’t deserve any wages, you’re time is not worth anything, . . . your customer’s not going to accept it, its got to be done over.” The record also discloses that Proto made “snide” comments concerning Stinger’s work to an employee and once told the employee that he no longer wanted to be in business with Stinger and that he intended to break her. On at least one occasion Proto threatened Stinger with a lawsuit, and on another he called the police when a dispute arose about him removing money from the business. In addition, Proto referred creditors of the Fur Boutique to Stinger after she had transferred her interest to Proto.

Proto also sued a relative of Stinger in an unsuccessful suit, and in the course of the action, commenced by Proto, his cause of action was dismissed by the District Court mid-trial because Proto had no title to the recovery for which he sued.

Testimony as to Stinger’s resulting mental state is as follows: (1) she had trouble sleeping; (2) she was nervous and suffered lapses of memory; (3) she became afraid to go to the store and at times had her sister accompany her; (4) she was nervous and scared by the presence of Proto; and, (5) she had lost weight and was, at times close to tears. At no time, however, did Stinger seek psychological or medical assistance.

On appeal Proto raises two issues for our review:

1. Whether the District Court’s finding of and award of damages for intentional infliction of severe mental distress was clearly erroneous; and,

2. Whether the District Court’s award of attorney fees to Stinger, based on a contract provision securing such fees to the prevailing party in an action to enforce the contract, was appropriate where Stinger’s counterclaim for specific performance and damages did not result in a judgment for specific performance, damages or other relief arising in the contract.

In Johnson v. Super Save Markets, Inc. (Mont. 1984), [211 Mont. 465,] 686 P.2d 209, 213 41 St.Rep. 1495, 1499-1500, we upheld the award of damages for emotional distress although the tort committed against Johnson involved no physical or mental injury. In Johnson, we said that in such a case we would look to whether the tortious conduct resulted in a substantial invasion of a legally protected interest and caused a significant impact upon the person of the plaintiff.

Moreover, in Johnson, we held that his right to liberty was violated when he was arrested, handcuffed, frisked, booked and charged for issuing a bad check, for which he had made complete restitution six months earlier. In the case at bar, Stinger has demonstrated no substantial invasion of a legally protected interest in the actions of Proto. While his actions toward Stinger were indeed aggravating, none of the actions rise to the level of an actionable tort, even his misguided attempts at litigation. In turn, Stinger does not charge Proto with intentional interference with her contractual or business relations, but in this case relies instead on her action for specific performance of the March 24, 1982 agreement by which the parties agreed to dissolve their business relationships.

In addition, to sustain an action for the intentional infliction of emotional distress, the authorities are in accord that the mental or emotional distress must be of a severe nature. See Prosser, Law of Torts, Section 11 at 51 (3rd ed. 1964); Pakos v. Clark (1969), 253 Or. 113, 453 P.2d 682; and Roberts v. Saylor (1981), 230 Kan. 289, 637 P.2d 1175, 1180, the latter case cited by us in Johnson, 686 P.2d at 212, 41 St. Rep. at 1499. The District Court concluded in its findings that Proto had intentionally “inflicted serious emotional distress and anguish upon” Stinger. We will respect that finding, although the denomination of the emotional distress as “serious” may not equate with “severe.”

We determine therefore, that the award of damages to Stinger in this case must be reversed insofar as they relate to emotional distress for the reason that the evidence fails to disclose a legally-protected interest invaded by Proto to bring about the severe emotional distress.

Proto next contends the District Court erred in its award of attorney fees to Stinger in the sum of $1,559.00. In addition to her claim for intentional infliction of mental distress, Stinger counterclaimed for specific performance of the parties’ March 24, 1982, agreement concerning the buy-out of Stinger’s interest in the business by Proto. Clause 10 of that agreement provided:

“That with respect to all of the above-mentioned transactions, both your client and mine will be entitled to the remedy of specific performance and that the prevailing party in any suit to enforce the above-mentioned activities shall be entitled to reasonable attorneys fees to be set by the court.”

The District Court found that Proto demonstrated by his actions and words that he did not intend to comply with the requirements of the parties’ March 24, 1982 agreement. Accordingly, the District Court ordered that Proto perform all his duties under the agreement. Specifically, the agreement provided that a meeting of shareholders would be held to approve the sale of inventory and corporate shares, that Proto file articles of amendment with respect to the corporation requesting its name be changed, and that Proto obtain a written release of Stinger from any further obligations under the parties’ lease of the business premises. The record discloses that Proto failed to perform the above acts required under the contract.

Proto contends that the District Court failed to award relief on Stinger’s contract claim and that the evidence does not support such a finding. As stated above, however, the District Court did award relief on Stinger’s contract claim by way of specific performance and we hold that there was substantial evidence in the record supporting such relief.

In Montana, with certain narrow and inapplicable exceptions, there is no right to recover attorney fees absent a specific statutory or contractual provision authorizing recovery of such fees. Sliter’s v. Lee (1982) 197 Mont. 182, 184, 641, P.2d 475, 476; Joseph Russell Realty Co. v. Kenneally (1980), 185 Mont. 496, 505, 605 P.2d 1107, 1112. In the instant case the District Court relied on the contractual provision of the parties’ March 24, 1982 agreement to award attorney fees and properly limited Stinger’s recovery to the number of hours spent by her attorney in obtaining a judgment for specific performance.

We therefore affirm the District Court’s award of attorney fees and reverse the District Court’s award of damages for intentional infliction of mental distress. Costs of appeal to Stinger since she is really the prevailing party in this lawsuit.

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


text:
    MIKE MORRIS, Plaintiff and Appellant, v. NATIONWIDE INSURANCE COMPANY, Defendant and Respondent.
    No. 85-598.
    Submitted on Briefs March 13, 1986.
    Decided July 31, 1986.
    722 P.2d 628.

      Erik B. Thueson, Great Falls, for plaintiff and appellant.
    Jardine, Stephenson, Blewett & Weaver, William Jacobsen, Great Falls, for defendant and respondent.
   MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

Appellant, Mike Morris, appeals from the judgment of the District Court, Ninth Judicial District, County of Teton, awarding him attorney fees in the amount of $4,664.88 against respondent, Nationwide Insurance Company.

Morris brought this case to recover damages sustained as a result of Nationwide’s violations of the Unfair Claim Settlement Practices Act, Section 33-18-201, et seq. MCA. The case is submitted to us by the parties with an agreed statement of facts pursuant to Rule 9(d), M.R.App.Civ.P.

The facts as agreed to by the parties are as follows: Morris brought an action to recover damages he alleged he sustained as a result of the negligence of Sun River Electric Co-op. He alleged that through the Co-op’s negligence a 7,200 volt line, owned and operated by the Co-op, started a fire on his ranch, causing the destruction of over 150 tons of hay, various fences, and trees, which were valuable windbreaks in his ranching operation.

The Co-op was insured for liability by Nationwide. Morris joined Nationwide to his action against the Co-op as a defendant, alleging that it had violated the Unfair Claim Settlement Practices Act, Section 33-18-201, et seq. MCA, in the manner in which it conducted settlement negotiations concerning his claim against the Co-op.

The District Court bifurcated the liability claim and the bad faith claim. The trial concerning the Co-op’s liability commenced on June 25, 1984 and resulted in a jury verdict in favor of Morris in the amount of $19,994.64. A judgment was subsequently entered by the District Court for this amount, plus costs.

The trial of the third party bad faith action against Nationwide commenced on June 24, 1985. One of the issues submitted to the jury in the bad faith trial was whether Morris should be awarded the attorney fees he incurred in prosecuting his claims against the Co-op as an element of his compensatory damages. With regard to attorney fees, the District Court instructed the jury as follows:

“If you determine that the defendant has violated its duty under the previous instruction just read to you, then you should award damages to the plaintiff for all losses proximately caused thereby. The measure of damages is the amount which will compensate for all the

detriment proximately caused by said conduct, whether it should have been anticipated or not. Provided that you determine that the loss has been suffered by the plaintiff, said damages shall include:

“Attorney fees and costs incurred in prosecuting the lawsuit against Nationwide’s insured, Sun River Electric Coop.”

No objection was made by Nationwide as to the portion of the instruction dealing with damages for attorney fees.

The jury determined that Nationwide had acted in bad faith under the provisions of the Unfair Claim Settlement Practices Act and awarded $42,500 in compensatory damages to Morris. The jury did not award Morris any punitive damages. The jury, however, did find that Nationwide’s bad faith had proximately caused Morris to incur attorney fees and costs in pursuing the underlying liability action against the Co-op. Question No. 1 of the jury verdict states:

“Should the plaintiff be awarded attorney fees and costs incurred in prosecuting his claim for damages resulting from the fire?

Answer:

Yes No

“If you have stated ‘yes’ to the above question, then the Court shall assess appropriate attorney fees and costs in a separate hearing.”

The hearing concerning attorney fees took place on July 31, 1985. At that time, the District Court took evidence in the form of testimony by Morris’ attorney. On September 13, 1985, the District Court filed findings of fact and conclusions of law regarding the issue of attorney fees and costs to be awarded as compensatory damages. The District Court determined that Morris was entitled to $4,664.88 as compensatory damages for attorney fees incurred in the liability action. The District Court arrived at the above sum by reference to the contingent fee agreement entered by Morris and his attorney which provided that Morris’ attorney, Erik B. Thueson, would receive 33 Vz percent of all monies obtained for Morris by way of settlement and/or judgment as compensation for his services. An addendum was written on the agreement excepting the first $6,000.00 recovered from attorney fees.

At the hearing on attorney fees, Thueson presented evidence that 352 hours of attorney time were expended preparing and trying the underlying liability action against the Co-op. Thueson further testified that he considered $85.00 per hour to be a reasonable fee for this type of litigation. Thus, based on Thueson’s testimony the District Court found reasonable attorney fees would have amounted to $29,992.25, if computed on an hourly basis.

Morris raises only one issue for our review: Whether the District Court erred in the manner in which it computed the amount of attorney fees awardable as compensatory damages.

Morris contends for a lodestar determination, that is, a fee based on reasonable hours expended times a reasonable hourly fee. It is well settled in Montana that where the subject of a contingent attorney fees contract does not offend public policy, it will be enforced according to its terms. Frank L. Pirtz Const., Inc. v. Hardin Town Pump (Mont. 1984), [214 Mont. 131,] 692 P.2d 460, 464, 41 St.Rep. 2366, 2371; Wight v. Hughes Livestock Co., Inc. (Mont. 1983), [204 Mont. 98,] 664 P.2d 303, 309, 40 St.Rep. 696, 702. Morris does not contend that the subject of his contingent attorney fees contract offends public policy. Rather, Morris contends that public policy of this State regarding the Unfair Claim Settlement Practices Act as announced by this Court in Klaudt v. Flink (Mont. 1983), [202 Mont. 247,] 658 P.2d 1065, 1068, 40 St.Rep. 64, 68, would be defeated if the attorney fees recovery in this case is limited to the contingent fee contract. The argument put forth by Morris, however, confuses the role of compensatory and punitive damages.

It is true as Morris points out that in Klaudt we stated that one of the purposes of the Unfair Claim Settlement Practices Act was to prevent insurance companies from exerting “leverage against individual claimants because of the disparity in resource base.” 658 P.2d at 1068, 40 St.Rep. at 68. Punitive damages are permitted in bad faith actions against insurance companies to deter such conduct. Morris, however, contends that the attorney fees should not be limited to the contingent fee agreement because to do so encourages insurance companies to engage in protracted litigation and to exert undue leverage against claimants.

In Fitzgerald v. Western Fire Ins. Co. (Mont. 1984), [209 Mont. 213,] 679 P.2d 790, 792, 41 St.Rep. 654, 655-56, we distinguished between punitive and compensatory damages as follows:

“Compensatory damages result from actual losses resulting from bodily injuries or property damages. Punitive damages arise out of specific conduct deemed undesirable and thereby require punishment of the wrongdoer and make an example of him. (Emphasis added.)”

The instructions given to the jury by the District Court properly described compensatory damages as “the amount which will compensate for all the detriment proximately caused . . .” The jury awarded Morris attorney fees as an element of compensatory damages and deferred to the District Court to determine the actual amount of attorney fees sustained by Morris. The amount of attorney fees sustained by Morris was set by the contingent fee agreement as 33 Ms percent of all monies obtained for Morris by way of judgment over $6,000. To allow Morris to recover attorney fees based upon an hourly fee changes the issue in this case from what amount will compensate Morris for the actual damages he sustained in the form of attorney fees, to what amount would reasonably compensate Morris’ attorney for his services. We are not concerned with the latter issue in this case.

Morris also cites the Court to Goggans v. Winkley (1972), 159 Mont. 85, 495 P.2d 594, in support of his contention that limiting attorney fees to the contingenty fee agreement reduces Morrisis damages. Rather, the contingent fee agreement is violative of the collateral source rule. We find this argument unavailing. The collateral source rule prevents a defendant from putting evidence before a jury that some third party has made payments to the plaintiff which might reduce his damages. Goggans, 159 Mont. at 92, 495 P.2d at 598. In the instant case, there is no claim that the contingency fee agreement reduces Morris’ damages. Rather, the contingency fee agreement provides a basis to determine the damages Morris sustained by way of attorney fees.

Finally, Morris cites us to dicta in State v. Marsh (1978), 175 Mont. 460, 467, 575 P.2d 38, 43, wherein we stated that a contingent fee contract is not controlling in demonstrating the “reasonableness” of an attorney fee, as supportive of his argument. As stated previously, the issue in this case is not what amount constitutes a reasonable amount for the attorney’s services, but what amount will compensate Morris for his actual losses sustained in employing his attorney. That amount was set by the contingent fee agreement.

We hold in this case that the provisions of the contingent fee agreement are controlling in computing the amount of attorney fees for which Morris would be liable to his attorney; that the contract fixes the damages Morris sustained thereof; and that the District Court did not err in the manner in which it computed attorney fees.

The parties agreed in the contingent fee agreement as follows:

“. . . Party of the First Part (Mike Morris) does hereby agree to reimburse Parties of the Second Part (attorneys) for any and all costs and expenses which they may incur in the representation of Party of the First Part and Thirty-three and One-third percent (33 Vs %) of all monies obtained for Party of the First Part by way of settlement and/or judgment as compensation for their services.”

By a written addendum to the contingent fee contract, the attorneys agreed that the “first $6,000.00 received shall be free of attorney fees.”

The agreed statement of facts under which the District Court acted recites that “plaintiff did not seek any award of damages for attorney fees incurred in prosecuting the bad faith claim against Nationwide Insurance Company.” The District Court was therefore confined by the agreed facts to the damages caused by attorney fees to the first part of the bifurcated action. The computation by the District Court of an attorney fee of $4,664.88 on a judgment of $19,994.64, after deducting $6,000.00 is correct.

Affirmed.

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