text:
    IN RE THE MARRIAGE OF KATHLEEN A. KOVASH, Petitioner and Respondent, and MYRON J. KOVASH, Respondent and Appellant.
    No. 92-611.
    Submitted on Briefs May 27, 1993.
    Decided August 17, 1993.
    50 St.Rep. 934.
    260 Mont. 44.
    858 P.2d 351.

      For Respondent and Appellant: Mark P. Yeshe, Donahoe & Yeshe, Helena.
    For Petitioner and Respondent: Robert F. Alsobrook, Bozeman.
   JUSTICE HUNT

delivered the Opinion of the Court.

Respondent Kathleen A. Kovash petitioned the Eighteenth Judicial District Court, Gallatin County, for dissolution of her marriage to appellant Myron J. Kovash. After a four-day trial, the District Court issued temporary orders and granted appellant unsupervised visitation with the parties’ four children. On August 31, 1992, the District Court issued its Findings of Fact and Conclusions of Law which terminated all contact between the children and appellant, but allowed conditional visitation. Appellant appeals from the order.

We affirm in part and modify the District Court’s order.

Appellant presents seven issues for this Court’s consideration.

1. Did the District Court err by modifying its December 13,1991, temporary custody order?

2. Did the District Court err by failing to consider the wishes of the children?

3. Did the District Court err when it terminated appellant’s visitation rights?

4. Did the District Court abuse its discretion by ordering the two older children to protect the two younger children?

5. Did the District Court err by not allowing grandparent visitation?

6. Did the District Court violate appellant’s constitutional rights by ordering him not to go to Coeur D’Alene, Idaho?

7. Did the District Court abuse its discretion when it granted respondent custody of the children?

Myron and Kathleen Kovash were married on October 16,1976, in Livingston. Four boys were bom into the marriage. The parties separated on June 4,1990.

The marriage was marred with abuse by Myron against Kathleen and the oldest child, J.K The first incidence of abuse occurred within six months after the marriage. Kathleen testified that Myron would strike her at least three to four times a year. The most severe incidents occurred in the last year of the marriage.

In April 1989, Kathleen testified that while on a boat Myron struck her in the face and almost knocked her into the water, knowing that she could not swim. Following a confrontation over marital problems, in December 1989, Myron assaulted Kathleen over a two-day period and pointed a pistol at her, causing her to fear for her life. Myron again assaulted Kathleen after further problems of the same nature arose. The oldest child, J.K., had to run for aid on both occasions. During the second incident, a police officer had to use force to pull Myron off Kathleen. There are many instances of abuse testified to by Kathleen which Myron denies. The parties sought marriage counseling in Montana.

Kathleen left Myron on June 4, 1990, and resided in a battered women’s shelter in Coeur D’Alene, Idaho, for a month. Kathleen obtained temporary restraining orders in both Montana and Idaho, but according to the District Court they have not been satisfactory. The Idaho orders permitted Myron to be with the children, if not Kathleen. The District Court entered a series of orders to keep Kathleen and the children safe, and instituted visits by Myron and his extended family. Upon the recommendation of the supervising social worker, the guardian ad litem, and the child’s counsellors, the court suspended visitation and limited telephone contact.

Kathleen testified that during telephone calls Myron usually focused on adult issues, which agitated the children. Myron has told one child on four occasions that he disowned him but later apologized. Kathleen has had difficulty getting the children to accompany her to the Woman’s Center for the calls. The children often acted out after the calls, such as by shoving their mother, and one of the children had anxiety attacks.

Dr. Jack Oakwright, a licensed psychologist in Coeur D’Alene, testified that he met with Kathleen and the children following a referral from the battered women’s shelter in Coeur D’Alene. Because Kathleen had insufficient funds, the bulk of the therapy was done by Jill Crocker, a master level assistant. Dr. Oakwright testified that the oldest child was damaged the most by physical and emotional abuse inflicted by Myron. He also testified that the child’s development in therapy was delayed. Dr. Oakwright expressed concern about reports from a hospital describing Myron as suicidal or homicidal after the incident in December 1989 involving the firearm. Viewing all the medical and psychological reports, Dr. Oakwright saw a consistent pattern where Myron would only submit to treatment as a way of manipulating the return of his wife. Dr. Oakwright also found a consistent pattern diagnosis that Myron was dangerous, suicidal, or homicidal. Dr. Oakwright expressed the opinion, based upon the review of the records and interviews with family members, that Myron represented a danger to the children and needed treatment before having anything other than professionally supervised and monitored visitation. Dr. Oakwright did not interview Myron.

Rob Marchetti, a child protective officer with the Department of Family Services, supervised two telephone visits between Myron and the children. He testified that the telephone visits harmed the children and the abuse was getting worse. He recommended that all contacts by telephone and in person be held in a therapist’s office and supervised by the therapist.

Jeannine Newville, the court-appointed guardian ad litem, also testified that the telephone visits were getting worse. She stated that shared custody was not in the best interest of the children. She recommended grandparent visitation.

On June 4, 1990, Kathleen filed her petition for dissolution. A four-day trial was held December 9 through 12,1991. After the trial, the court issued a temporary order concerning custody, visitation, and restraint of the parties. The court granted unlimited visitation. On August 31, 1992, the District Court issued its findings of fact and conclusions of law and terminated all visitation and contact between Myron and the children, but suspended the termination upon certain conditions. Myron appeals the order.

I.

Did the District Court err by modifying its December 13, 1991, temporary custody order?

Myron argues that the District Court’s modification of its December 13, 1991, order violated his right to due process and was an abuse of discretion. He contends that the District Court needed to find a change in circumstances when issuing a final custody order which differed from the temporary order. We disagree.

In its temporary order, the District Court granted Myron unsupervised visitation. On July 30, 1992, the guardian ad litem wrote an addendum which stated that Myron’s behavior was not improving because of his regular visits with his sons, and was, in fact, getting worse. The guardian ad litem also stated that Myron was dangerous. When the District Court issued its findings of fact and conclusions of law, it terminated all visitation and contact between the children and Myron. The court did, however, suspend the termination with certain conditions. Myron contends that the court’s consideration of the guardian ad litem’s report without a hearing to allow Myron to present his arguments was a violation of due process and amounted to an abuse of discretion.

Nothing in the District Court’s findings of fact and conclusions of law suggests that the court considered the July 30, 1992, report of the guardian ad litem. The court made extensive findings relating to the guardian ad litem’s testimony at trial. A tape recorded conversation of October 21, 1991, between the children and Myron convinced the guardian ad litem that matters were getting worse. The District Court heard this taped conversation and agreed. The guardian ad litem testified that shared custody was not in the best interest of the children, and recommended that Myron have only professionally supervised visitation. We hold that the District Court did not violate Myron’s due process rights.

Myron also contends that the District Court needed to find a change of circumstances when issuing its final custody order which differed from the temporary order. We decided a similar issue in In re Marriage of Allen (1989), 237 Mont. 64, 771 P.2d 578. In Allen, the mother had temporary custody of the children for two and one-half years before the District Court awarded custody to the father. We explained in Allen that:

As expressed in § 40-4-213, MCA, the best interest test is the standard used by the court to award temporary custody. However, the court, upon motion for temporary custody, is only determining the best interest of the child with regard to temporary custody pending resolution of the action.
Temporary child custody is merely an initial determination made to ascertain which of [the] parents will keep children until such time as full hearing on custody can be made.
27C C.J.S. Divorce, § 642, footnote 30. While district courts must consider the stability of the child’s home when it [sic] determines custody, it would nevertheless be inherently unfair to require the temporary non-custodial parent to make a higher threshold showing of changed circumstances before a custody order may deviate from the temporary order.

Allen, 771 P.2d at 580.

In Allen, we quoted the following commissioner’s note to § 40-4-213, MCA:

[This action] encourages trial courts to issue temporary custody orders without formal hearing whenever possible. Since the hearing itself may be a traumatic event for both parents (and therefore for their children, indirectly), the trial court is authorized to make temporary orders on the basis of affidavits alone unless one of the parties files formal objection to that procedure. In most cases, it is expected that trial judges will award temporary custody to the existing custodian so as to minimize disruption for the child.

Allen, 771 P.2d at 581.

If changed circumstances are required to be proven before modifying temporary custody orders, parents would be forced to litigate temporary custody. This result would be contrary to the purpose of the statute. Therefore, we hold that the District Court was not required to find a change in circumstances before modifying the temporary custody order.

II.

Did the District Court err by failing to consider the wishes of the children?

Section 40-4-212(l)(a) and (b), MCA, requires the court to consider the wishes of the children when determining custody. The District Court interviewed the children before the December 1991 hearing. The court also interviewed the second child during the March 5,1992, hearing. All the children testified that they wanted to visit their father, but that they did not like the telephone calls because of Myron’s behavior.

The guardian ad litem, the children’s counselor, and the children’s social worker recommended that Myron only have supervised visitation. The court did not order supervised visitation. Instead, it gave Myron conditional visitation with his children for Christmas 1992 and for the month of July 1993. The court ordered weekly telephone visitation and restricted it so that the children would not have to discuss “adult issues.” The court granted the children the authority to terminate the telephone calls after 15 minutes.

The district court need not make a specific finding on each statutory element. In re Marriage of Arrotta (1990), 244 Mont. 508, 513, 797 P.2d 940, 943. The court must show that it has considered each element by making specific findings regarding the best interests of the children. Arrotta, 797 P.2d at 943. The district court is not required to award custody or visitation based upon the child’s preferences. Arrotta, 797 P.2d at 943. The order attempted to balance the children’s wishes against what was in their best interest. We conclude from reading the record, and from the District Court’s extensive findings, that the children’s wishes were properly considered when conditional visitation was granted.

III.

Did the District Court err when it terminated Myron’s visitation rights?

As stated previously, Myron’s contact with his children was suspended with conditions. Myron was still allowed visitation with his children but was required to meet specific conditions relating to the weekly telephone calls. If he complied with these conditions, he was given the opportunity to visit the children during the Christmas holidays. If the Christmas visitation proceeded without incident, then Myron was allowed to have one month’s worth of visitation during the summer. If Myron did not meet these guidelines, the court would terminate his visitation rights. The court’s use of the carrot and stick approach was an effort to curb Myron’s behavior toward his children and foster a more healthy relationship. It does not amount to a termination of visitation rights. We hold that the District Court did not abuse its discretion in placing conditions on Myron’s visitation.

IV.

Did the District Court abuse its discretion by ordering the two older children to protect the two younger children?

In view of the testimony and evidence produced during the proceedings, the court was concerned about the safety of the children. The court interviewed the boys and felt that it was appropriate to have the older children supervising visitation and protecting the younger ones. Dr. Oakwright testified that it would be in the best interests of the children to allow them to initiate the telephone contacts and to terminate the telephone calls with their father. We hold that the District Court did not abuse its discretion.

V.

Did the District Court err by not allowing grandparent visitation?

Section 40-4-217(2), MCA, allows the district court to grant grandparent visitation if it finds that it is in the best interests of the children. In this instance, the District Court granted grandparent visitation, but they could only exercise their rights simultaneously with Myron. We hold that the District Court did not abuse its discretion in granting the grandparents visitation.

VI.

Did the District Court violate Myron’s constitutional rights by ordering him not to go to Coeur D’Alene, Idaho?

Myron contends that the court’s order restraining him from going to Coeur D’Alene is too broad and infringes on his constitutional right to travel. We agree. The order is overly broad in the sense that it does not consider that Myron may have other business in Coeur D’Alene or that he may be travelling through the city.

There is substantial evidence in the record to support the conclusion that when Myron travels to Coeur D’Alene, Kathleen and the children are subjected to harassment. The intent of the order is to keep Myron away from Kathleen and the children until the court finds it appropriate to lift the restraining order. We hold that the portion of the court’s order preventing Myron from traveling to Coeur D’Alene is too broad and should be stricken. We affirm those portions of the order that intend to keep Myron away from Kathleen and the children.

VII.

Did the District Court abuse its discretion when it granted Kathleen custody of the children?

Our standard of review in custody matters is whether substantial credible evidence supports the court’s determination. In re Marriage of Fesolowitz (1993), [258 Mont. 380], 852 P.2d 658, 662, 50 St. Rep. 575, 578. The law presumes that joint custody is in the best interest of the child. Courts award joint custody to assure the child frequent and continuing contact with both parents. Section 40-4-223, MCA. Physical custody should be arranged as equally as possible between the parents, with the child’s best interest as the primary consideration. Fesolowitz, [258 Mont. 380], 852 P.2d at 662. The District Court must consider the factors set forth in § 40-4-212, MCA, when determining which parent receives custody.

Here the court granted custody of the children to Kathleen. During trial, Dr. Oakwright testified that Myron was “dangerous to the welfare of his children and needs treatment before he should be allowed anything but the most closely and professionally supervised visitation.” He recommended that Kathleen have sole custody. Mr. Marchetti recommended that Myron have physical visitation only in a therapist’s office with an emphasis on therapy helping Myron in not being abusive. The guardian ad litem recommended that Kathleen have custody of the children. We hold there is substantial credible evidence to support the Court’s conclusion that it is in the best interest of the children that Kathleen be granted custody.

We affirm all issues except as to the modification of the portion of the order that prohibits Myron from traveling to Coeur D’Alene, Idaho.

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


source: Caselaw Access Project

author: JUSTICE NELSON

license: Public Domain

text:
    RICHARD W. SMITH, d/b/a HIGH PLAINS GAMING-SMITH BROTHERS AMUSEMENTS; DENNIS H. DANIELS, d/b/a FLEETWOOD AMUSEMENT OF MISSOULA; DAVID G. KELMAN, d/b/a AMERICAN MUSIC COMPANY; EVELYN KELMAN, d/b/a ARCHER’S CASINO; THOMAS HEISLER, d/b/a BINGO BONANZA; CHARLES P. WIECK, d/b/a BEDROCK GAMING; JON L. DEHLER, d/b/a FLEETWOOD AMUSEMENTS; and GLEN ALEXANDER, d/b/a ACE AMUSEMENT, Plaintiffs and Appellants, v. VIDEO LOTTERY CONSULTANTS, INC., a Montana corporation, Defendant and Respondent.
    No. 93-097.
    Submitted on Briefs July 15, 1993.
    Decided August 17, 1993.
    50 St.Rep. 939.
    260 Mont. 54.
    858 P.2d 11.

      For Plaintiffs and Appellants: George T. Radovich, Billings.
    For Defendant and Respondent: Tom Stonecipher and Peter M. Kirwan, Kirwan & Barrett, PC., Bozeman.
   JUSTICE NELSON

delivered the Opinion of the Court.

This is an appeal from an Order of the Eighteenth Judicial District Court granting Defendant’s (Video Lottery’s) motion to dismiss the Plaintiffs’ amended complaint for failure to state a claim upon which relief may be granted. We affirm in part and reverse in part.

We restate the issues on appeal as follows:

1. Did the District Court err in dismissing the Plaintiffs’ restraint of trade claim against Video Lottery?

2. Did the District Court err in dismissing the Plaintiffs’ monopoly and rebates claims against Video Lottery?

In their amended complaint, the Plaintiffs allege the following facts. The Plaintiffs are engaged in the retail gambling business. Video Lottery is engaged in selling wholesale gambling machines and in operating retail gambling machines. Video Lottery is a competitor of the Plaintiffs and has refused to provide its machines to the Plaintiffs on a wholesale level. Plaintiffs filed an amended complaint against Video Lottery, alleging that its failure to sell the machines to the Plaintiffs violated three sections of the Montana Unfair Trade Practices Act, §§ 30-14-201, et seq., MCA. The Plaintiffs also requested an injunction of the alleged violative conduct.

Video Lottery moved to dismiss the amended complaint pursuant to Rule 12(b)(6), M.R.Civ.P, for failure to state a claim upon which relief could be granted. The district judge granted this motion, and the Plaintiffs appealed.

In reviewing a Rule 12 motion to dismiss, we will construe the complaint in the light most favorable to the plaintiffs and take the allegations of the complaint as true. Willson v. Taylor (1981), 194 Mont. 123, 126, 634 P.2d 1180, 1182. The dismissal will be affirmed only if this Court finds that the plaintiffs are not entitled to relief under any set of facts which could be proven in support of the claim. Proto v. Missoula County (1988), 230 Mont. 351, 352-53, 749 P.2d 1094, 1095-96.

I — RESTRAINT OF TRADE CLAIM

The Plaintiffs allege that Video Lottery has violated § 30-14-205(2)(c), MCA, which provides:

It is unlawful for a person or group of persons, directly or indirectly:

(2) for the purpose of creating or carrying out any restriction in trade, to: ...
(c) prevent competition in the distribution or sale of merchandise or commodities.

Although this section is modeled after § 1 of the Sherman Act, it differs in one critical respect. The Sherman Act requires two or more persons to be involved in the -unlawful trade restraint; in effect, a conspiracy must exist. 15 U.S.C. § 1; Copperweld Corp. v. Independence Tube Corp. (1984), 467 U.S. 752, 767-68, 104 S.Ct. 2731, 2739-40, 81 L.Ed.2d 628, 641. However, the Montana counterpart states that a “person” may violate this section. Thus, the Montana statute on restraint of trade facially appears to be broader than the Sherman Act, as one person acting alone may violate the Montana statute.

We note that there is minimal Montana law interpreting the Unfair Trade Practices Act, and no cases interpreting § 30-14-205(2)(c), MCA. We also recognize that cutting litigation short at the initial pleading stage is not favored. Willson, 634 P.2d at 1183. This is especially true when the cause of action is based upon a statute that has not been previously interpreted and where no underlying factual record has been developed.

Therefore, because Montana’s restraint of trade statute differs in some respects from the Sherman Act, and because we have not heretofore interpreted § 30-14-205(2)(c), MCA, on appeal and in the context of a factual record developed on the basis of the granting of a motion for summary judgment or on the basis of a trial, we hold that dismissing the complaint on Count One was premature and thus error. While not ruling on the merits of their claim, we cannot say that the Plaintiffs are not entitled to relief under any set of facts which could be proven in support of their claim. We believe that the Plaintiffs’ allegations should be more fully developed through discovery. See Willson, 634 P.2d at 1183. If the Plaintiffs cannot develop a sustainable action through discovery, their claim under § 30-14-205(2)(c), MCA, may be properly disposed of through summary judgment.

As to the Plaintiffs’request for an injunction under § 30-14-222, MCA, we hold that, if the Plaintiffs are able to develop and maintain an action under § 30-14-205(2)(c), MCA, they may then be entitled to injunctive relief. However, if the Plaintiffs cannot factually develop and maintain an action under this section, then an injunction will not properly issue.

Accordingly, we reverse the District Court’s dismissal of Counts One and Four, and remand for proceedings consistent with this opinion.

II — MONOPOLY AND REBATES CLAIMS

The Plaintiffs also allege that Video Lottery has refused to provide its machines to the Plaintiffs in order to create a monopoly in the sale and use of Video Lottery machines. This claim is based on § 30-14-205(2)(g), MCA, which provides:

It is unlawful for a person or group of persons, directly or indirectly:

(2) For the purpose of creating or carrying out any restriction in trade, to:...
(g) create a monopoly in the manufacture, sale, or transportation of an article of commerce.

This section of the Unfair Trade Practices Act is very similar to § 2 of the Sherman Act, which prohibits the creation of a monopoly. Because the statutes are similar, we will give due weight to the federal courts’ interpretation of this type of alleged antitrust violation.

In this case, the Plaintiffs allege that Video Lottery has refused to sell its gambling machines to them. However, it is clear that “[a] manufacturer has a natural monopoly over its own products, especially when the products are sold under a trademark.” Sadler v. Rexair, Inc. (D.C.Mont. 1985), 612 F.Supp. 491, 494.

In Sadler, a supplier of Rainbow vacuum cleaners terminated a distribution agreement with the plaintiff. The plaintiff filed an action against the supplier, alleging antitrust violations. The court held that “[a] “brand’ monopoly over the manufacturer’s own product... is not a violation of 15 U.S.C. § 2” and dismissed the action. Sadler, 612 F.Supp. at 494.

Following the reasoning of Sadler, we hold that a brand monopoly over the manufacturer’s own product does not violate § 30-14-205(2)(g), MCA. Here, Plaintiffs allege Video Lottery has refused to sell Video Lottery gambling machines to them. This allegation cannot sustain a cause of action under this section of the Unfair Trade Practices Act.

The Plaintiffs also claim that Video Lottery’s refusal to sell its machines violates § 30-14-215(1), MCA, which prohibits secret rebates, as follows:

(1) The secret payment or allowance of rebates, refunds, commissions, or unearned discounts, whether in the form of money or otherwise, or secretly extending to certain purchasers special services or privileges not extended to all purchasers purchasing upon like terms and conditions, to the injury of a competitor and when such payment or allowance tends to destroy competition, is an unfair trade practice.... (emphasis added)

This section applies when a seller discriminates between purchasers. The Plaintiffs have alleged that Video Lottery has refused to sell to them. Therefore, the Plaintiffs are not “purchasers” as contemplated by this statute. Because this section of the Unfair Trade Practices Act applies only to discrimination between purchasers, the Plaintiffs have failed to state a claim under this section upon which relief may be granted.

We hold that the District Court properly dismissed Counts Two and Three of the Plaintiffs’ amended complaint.

Affirmed in part, reversed in part, and remanded for proceedings consistent with this opinion.

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


author: JUSTICE GRAY

text:
    SAMUEL J. GRENZ, Petitioner and Appellant, v. FIRE AND CASUALTY OF CONNECTICUT, Respondent and Respondent.
    No. 93-232.
    Submitted on Briefs August 5, 1993.
    Rehearing Denied Sept. 16, 1993.
    Decided August 17, 1993.
    50 St.Rep. 942.
    260 Mont. 60.
    857 P.2d 730.

      For Appellant: Samuel J. Grenz, Pro Se, Stevensville.
    For Respondent: Terry Spear, Matovich, Addy & Keller, PC., Billings.
   JUSTICE GRAY

delivered the Opinion of the Court.

Claimant Samuel Grenz appeals from an order of the Workers’ Compensation Court dismissing his petition for workers’ compensation benefits. We affirm.

The dispositive issue on appeal is whether the Workers’ Compensation Court erred in concluding that the one-year statute of limitations barred Grenz’ workers’ compensation claim for disabilities allegedly resulting from a series of microtraumas.

In 1984, Samuel Grenz injured his right elbow while working for the American Stud Company (American Stud) in Flathead County, Montana. He continued his employment with American Stud until 1985. American Stud’s insurer, Fire and Casualty of Connecticut (F&C), paid disability and medical benefits for the bumped elbow until 1991.

With the 1984 injury began a seemingly endless stream of litigation that has resulted in multiple appeals to this Court and innumerable proceedings in the Workers’ Compensation Court. For purposes of this opinion, we need address only the recent procedural and factual history of this case.

In 1991, this Court affirmed the Workers’ Compensation Court’s determination that Grenz was not permanently totally disabled as a result of his 1984 elbow injury. Grenz v. Fire and Cas. of Connecticut (1991), 250 Mont. 373, 380, 820 P.2d 742, 746 (hereafter Grenz I, although it was not, in fact, the first Grenz appeal). We concluded that Grenz had failed to prove the causal connection between his degenerative arthritis and the 1984 elbow injury. Grenz I, 820 P.2d at 746.

In Grenz I, Grenz also attempted to argue on appeal that his degenerative arthritis was caused by a series of “microtraumas” associated with the heavy lifting, jarring, and vibrations of the machinery at his employment; these microtraumas, he asserted, were suffered subsequent to and separately from his 1984 elbow injury. We refused to consider this argument as Grenz had not raised in it the Workers’ Compensation Court. To the contrary, Grenz had steadfastly maintained that the 1984 elbow injury was his only basis for compensation. Grenz I, 820 P.2d at 746.

Following Grenz I, Grenz filed a new claim for workers’ compensation benefits, asserting that his arthritis was caused by microtraumas, separate and apart from, and subsequent to, the 1984 elbow injury. F&C moved to dismiss the petition, arguing that Grenz’ claim was barred by res judicata or, alternatively, by the one-year statute of limitations of the Workers’ Compensation Act. The Workers’ Compensation Court granted F&C’s motion on the basis of res judicata. Grenz appealed.

In Grenz v. Fire and Cas. of Connecticut (1992), 255 Mont. 121, 124, 841 P.2d 494, 496 (Grenz II), we reversed the Workers’ Compensation Court’s determination that his microtrauma claim was barred by res judicata, and remanded with limiting instructions:

Reversed and remanded with instructions to the Workers’ Compensation Court to proceed to a determination of the insurer’s alternative basis for its motion to dismiss, namely, that Grenz’s latest claims are time barred.

On remand, the hearing examiner determined that Grenz had not filed his new claim within one year after he had stopped working for American Stud in 1985 and, therefore, he had not complied with § 39-71-601, MCA (1983). Thus, the hearing examiner ordered the dismissal of Grenz’ new claim. The Workers’ Compensation Court adopted the hearing examiner’s order on April 21, 1993. Grenz appeals.

Did the Workers’ Compensation Court err in concluding that the one-year statute of limitations barred Grenz’ workers’ compensation claim for disabilities allegedly caused by a series of microtraumas?

Grenz raises several interrelated challenges to the Workers’ Compensation Court’s application of the statute of limitations. In reviewing conclusions of law of the Workers’ Compensation Court, we determine if the court’s interpretation of the law is correct. Grenz I, 820 P.2d at 745; Steer, Inc. v. Dep’t of Revenue (1990), 245 Mont. 470, 475, 803 P.2d 601, 603.

The statute of limitations which governs this issue provides as follows:

(1) In case of personal injury or death, all claims shall be forever barred unless presented in writing to the employer, the insurer or the division, as the case may be, within 12 months from the date of the happening of the accident, either by the claimant or someone legally authorized to act for him in his behalf.

Section 39-71-601, MCA (1983). The statute unequivocally requires that claims be presented in writing within twelve months of the accident. Grenz concedes that his microtrauma “accidents” occurred during his period of employment with American Stud, employment which ended in 1985. He did not file his claim for benefits until 1992. Thus, it is undisputed that Grenz failed to comply with the requirements of the Workers’ Compensation Act’s statute of limitations. We turn, therefore, to his various arguments against the application of § 39-71-601, MCA (1983), to his situation.

REPORTING OF ARTHRITIS TO EMPLOYER

Grenz first claims that he reported his work-related microtrauma injuries to his employer within the statutory period. He asserts that he reported pain in his other joints to his treating physician in 1984, who, in a note to Grenz’ employer, recommended that Grenz perform lighter work because of his degenerative arthritis. Grenz points to two other situations in which he claims he informed his employer that he was suffering from arthritis or that his work was aggravating his degenerative condition.

Grenz’ actions do not satisfy the requirements of the statute of limitations. Section 39-71-601, MCA, requires the claimant to present the claim in writing within the one-year time period; nowhere does Grenz allege that he completed any type of paperwork concerning this independent injury until 1992.

Second, during the time in question, Grenz steadfastly maintained that his arthritis was caused by, and derivative from, his elbow injury of August 1984. Indeed, in Grenz’ statement of facts to this Court, he states that “the different way he performed his work in order to compensate for the bumped elbow may have been the cause of these other joint problems.” In Grenz I, we quoted from Grenz’ trial testimony in which he stated:

“Q. Your injury occurred in 1984?
“A. Right.
“Q. That’s the only industrial injury you claim; is that right?
“A. Right...”

Grenz I, 820 P.2d at 746. Therefore, although Grenz may have “informed” his employer that he was suffering from arthritis within the one-year period, he does not point to any evidence by which he informed his employer that he was suffering from arthritis caused by microtrauma injuries separate and apart from the elbow injury. He continuously maintained that the bumped elbow was the source of his arthritis.

The requirements of § 39-71-601, MCA, are mandatory, and compliance with the time limits is essential to the action. Wassberg v. Anaconda Copper Co. (1985), 215 Mont. 309, 315-16, 697 P.2d 909, 913. We conclude that Grenz did not satisfy § 39-71-601, MCA(1983), by informing his employer that he was suffering from degenerative arthritis caused by microtrauma injuries separate from and subsequent to his right elbow injury.

EQUITABLE ESTOPPEL

Grenz next argues that F&C should be equitably estopped from relying on the statute of limitations, citing Scott v. Utility Line Contractors (1987), 266 Mont. 154, 734 P.2d 206, and Weigland v. Anderson-Meyer Drilling Co. (1988), 232 Mont. 390, 758 P.2d 260. Scott and Weigland are inapplicable to the case before us.

In both cases, the claimant failed to present his claim within the one-year statutory period but assisted the employer in preparing the Employer’s First Report within the time period. Scott, 734 P.2d at 208; Weigland, 758 P.2d at 262. We concluded in both cases that the Employer’s First Report contained ample information to inform the employers of the nature and basis of the workers’ potential claims. The report satisfied the purpose behind § 39-71-601, MCA, which is to give the employer written notice of the worker’s claims within twelve months of the injury or accident in order to allow the employer to investigate the claim and, if necessary, prepare a defense. Scott, 734 P.2d at 208; Weigland, 758 P.2d at 262.

Grenz did not assist his employer in completing an Employer’s First Report of a new and separate microtrauma-based injury; in fact, he did nothing that would have alerted the employer to this new cause of his degenerative arthritis. As stated above, throughout this period, Grenz insisted that the arthritis was caused by his elbow injury. It was only after he had lost his case concerning the elbow injury in 1991 that he asserted that the arthritis was caused by a series of micro-traumas unrelated to the elbow injury. The employer and insurer were completely unable to investigate the claim and prepare a defense to the microtrauma injury until 1992, seven years after Grenz had ceased working at American Stud. The equitable estoppel principles from Scott and Weigland simply have no application here.

In another twist to his estoppel argument, Grenz claims that F&C waived its right to deny his claim for benefits because it paid medical benefits for treatment of his arthritis. We find no merit to this argument. As explained in Grenz I, F&C accepted liability for Grenz’ disabilities resulting from his bumped elbow and paid benefits to Grenz only for disabilities resulting from the bumped elbow. Grenz I, 820 P.2d at 747. We also emphasized in Grenz 1 that under § 39-71-608, MCA (1983), F&C’s payment of benefits did not waive its right to subsequently assert nonliability for conditions not related to the elbow injury. Grenz I, 820 P.2d at 747. Thus, we conclude that F&C has not waived its right to deny liability for the unrelated, microtrauma-based injuries now claimed by Grenz.

As a third aspect to his estoppel theory, Grenz claims that F&C “knew of Grenz’s degenerative condition and ... [a]t no time did they inform Grenz or his attorney of the need to file or modify his claim, though the evidence clearly shows that the Respondent knew of Grenz’s seeking medical care for his degenerative condition.” He also claims that because he was functionally illiterate, he is entitled to more leniency. We disagree.

Faced with a similar argument in Wassberg, we emphasized:

... the duty is upon the claimant to file his claim, not upon the insurer to solicit claims. The Workmen’s [sic] Compensation Act has not changed the principle that he who asserts a right has the burden of proof or the burden of proceeding.

Wassberg, 697 P.2d at 915. The employer has no duty to pursue the employee’s claim for him. Wassberg, 697 P.2d at 916. As in Wassberg, Grenz was cognizant of the availability of a compensation claim; he had participated in the process before. Regarding his asserted illiteracy, we note that Grenz initially obtained workers’ compensation benefits for his elbow injury beginning in 1984 and has become quite familiar with the procedures involved. We also note the reams of judicial papers which Grenz has filed as a very competent pro se litigant in the process of this protracted litigation. F&C had no duty to inform Grenz of his duty to assert a separate claim.

We conclude that, under any form of equitable estoppel, the statute of limitations is not tolled in this case.

BREACH OF TRUST

Lastly, Grenz asserts that F&C stood in a trust relationship with Grenz and that F&C breached that trust in handling his workers’ compensation claim. In Grenz II, this Court specifically limited the issues on remand:

Reversed and remanded with instructions to the Workers’ Compensation Court to proceed to a determination of the insurer’s alternative basis for its motion to dismiss, namely, that Grenz’s latest claims are time barred.

Grenz II, 841 P.2d at 496. Given that explicit mandate, Grenz was precluded from raising the new issue of breach of trust on remand and, therefore, the issue is not properly before this Court.

We conclude that the Workers’ Compensation Court did not err in dismissing Grenz’ petition for Workers’ Compensation benefits based on his failure to comply with the statute of limitations.

Affirmed.

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


author: JUSTICE TRIEWEILER JUSTICE WEBER

text:
    STEVEN J. HARMAN, Plaintiff and Appellant, v. MIA SERVICE CONTRACTS and AMERICAN ADJUSTMENT COMPANY, INC., Defendants and Respondents.
    No. 92-270.
    Submitted on Briefs September 10, 1992.
    Decided August 19, 1993.
    50 St.Rep. 954.
    260 Mont. 67.
    858 P.2d 19.

      For Plaintiff and Appellant: Paul M. Warren, Billings; A. Clifford Edwards, Edwards Law Firm, Billings.
    For Defendants and Respondents: William R. McNamer, McNamer, Thompson, Werner & Stanley, Billings.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

Plaintiff Steven J. Harman filed his complaint in the District Court for the Thirteenth Judicial District in Yellowstone County to recover damages pursuant to a vehicle service contract entered into with a Billings auto dealer. Defendant MIA Service Contracts (MIA) was the original administrator of the contract and adjusted claims made pursuant to the contract. Defendant American Adjustment Company, Inc. (AAC), later assumed responsibility for adjusting plaintiff’s claim. The District Court concluded that plaintiff was not entitled to recover against defendant AAC under any theory alleged in plaintiff’s complaint and granted AAC’s motion dismissing plaintiff’s claim against it by summary judgment. From that judgment, plaintiff appeals. We affirm in part and reverse in part.

The issues on appeal are:

1. Was plaintiff a third-party beneficiary of a contract entered into by defendant American Adjustment Company, Inc., and therefore, entitled to enforce that contract?

2. Can plaintiff sue American Adjustment Company, Inc., or Century Indemnity Company, for violations of the Unfair Trade Practices Act found at § 33-18-201, MCA, or is such a suit barred by plaintiff’s failure to first comply with § 33-18-242(6)(b), MCA?

FACTUAL BACKGROUND

On November 23,1985, plaintiff purchased a Jeep Cherokee from Bert Arnlund Chrysler in Billings. On August 29, 1986, he paid Arnlund $655 for a vehicle service contract in which Arnlund agreed to make certain repairs to plaintiff’s vehicle beyond the period of time covered in the manufacturer’s warranty agreement.

The contract provided that it would be administered by MIA Service Contracts and that the administrator must be contacted for authorization of repairs. The contract also provided that the administrator did not assume any liability to the contract holder, but that the administrator’s liability was to the dealer in accordance with their separate agreement.

From what can be determined from the record, it appears that MIA helped dealers throughout the country market vehicle service contracts, and then had a separate agreement with each dealer to administer the contracts by adjusting claims made pursuant to the contracts after they were sold. Pursuant to a separate agreement between MIA and the dealer, repairs could not be made without MIA’s prior approval. A portion of the premium would be retained by the dealer and put into a reserve fund to pay some claims made pursuant to the contracts. A portion of the premium was retained by the dealer as his fee for selling the contract; a portion was paid to MIA to administer the contract; and a portion was paid by MIA to Century Indemnity Company (Century) to insure against those claims which exceeded the dealer’s responsibility under its agreement with MIA and Century. Century is a wholly owned subsidiary of CIGNA.

In 1987, MIA declared itself bankrupt and stopped doing business as administrator of the contracts.

As mentioned above, Century had sold an insurance policy to Arnlund covering him against vehicle service contract claims above those amounts which were covered by the reserve fund maintained by Arnlund.

Another wholly owned subsidiary of CIGNA, AAC, had been basically dormant until 1988 when it was resurrected by Century for the sole purpose of adjusting any claims made pursuant to contracts marketed by MIA prior to its bankruptcy. According to AAC’s general manager, Robert McAllister, the agreement to handle these claims would have been entered into between AAC and Century. However, it is clear from his testimony that AAC assumed those responsibilities for adjusting claims that had previously been assigned to MIA pursuant to its separate contract with Arnlund.

On April 12, 1990, the fuel pump in plaintiff’s Jeep Cherokee malfunctioned and he replaced it while in Bozeman at a cost of $144. He submitted a claim to AAC for the amount of that repair. However, defendant refused to authorize payment for the repair based upon the fact that defendant had not given prior approval for the expenditure.

On October 17,1990, plaintiff discovered damage to his front drive line axle and requested coverage from AAC for the cost of that repair. However, AAC denied that the drive line axle was a covered part under the vehicle service contract. Prior to plaintiff’s purchase of the vehicle service contract, Arnlund and MIA provided plaintiff with a brochure which indicated that the drive line would be covered.

On November 13, 1990, plaintiff filed a complaint against AAC and MIA in which he described the vehicle service contract and alleged that it had been breached by defendants. In addition to his claim for breach of contract, plaintiff alleged that defendants’ denial of his claims was a violation of the covenant of good faith and fair dealing, that defendants were negligent, that defendants violated § 33-18-201(5), MCA, of the Unfair Trade Practices Act, and that defendants were guilty of constructive fraud, gross negligence, and oppression which entitled plaintiff to punitive damages pursuant to § 27-1-221, MCA.

Defendant MIA did not appear and did not respond to plaintiff’s allegations.

On April 11,1991, defendant AAC moved for summary judgment for the reason that it had no direct contractual relationship with plaintiff and that the third-party claim filed by plaintiff pursuant to § 33-18-242, MCA, must await resolution of any underlying claim that plaintiff had against the auto dealer, Arnlund.

On April 1,1992, the District Court entered its memorandum and order granting AAC’s motion for summary judgment, and on April 21, 1992, final judgment was entered by the District Court in favor of AAC and certified as final pursuant to Rule 54(b), M.R.Civ.P.

On appeal from the judgment of the District Court, plaintiffs arguments focus on two principal issues. The first is whether plaintiff had enforceable rights as a third-party beneficiary of contracts in which AAC promised to perform services for plaintiff’s benefit.The second issue is whether AAC can be sued as an insurer for violation of the Unfair Trade Practices Act without any prior resolution of plaintiff’s right under its contract with the auto dealer, Arnlund.

CONTRACT ISSUE

The District Court found that the vehicle service contract was entered into between plaintiff and his auto dealer. It also determined that any repair work done under the contract must be approved by the administrator (MIA), but that the administrator assumed no personal liability to plaintiff.

The District Court also found that Century insured Arnlund against claims under extended service contracts, and that when MIA folded, Century resurrected AAC to adjust claims under the service contracts. However, the court concluded that neither Century nor AAC were involved in marketing the vehicle service contracts.

Based upon the discrepancy between the brochure used in marketing the contract and the terms of the written agreement itself, the District Court concluded that there was at least a genuine issue of fact as to whether there was coverage under the contract for the claims made by plaintiff. The District Court also concluded that there was a genuine issue of fact regarding whether Arnlund was acting as an agent for MIA, which would make MIA liable for performance under the contract. Therefore, the District Court concluded that plaintiff could sue both the dealer and MIA. However, Arnlund was not a party to the suit and MIA was involved in bankruptcy proceedings and had not appeared.

The District Court concluded that since neither Century (whom plaintiff sought to join as a defendant by amendment) nor AAC were parties to the contract, they could not be sued for breach of the contract nor its related theories. Furthermore, the District Court concluded that even though Century did insure Arnlund, and AAC acted on Century’s behalf in adjusting claims pursuant to that policy of insurance, there was no direct policy of insurance issued from either Century or AAC to plaintiff. Therefore, any claim that plaintiff may have pursuant to the Unfair Trade Practices Act is a third-party claim; and before it can be pursued, plaintiff would first have to resolve his underlying claim against the dealer pursuant to § 33-18-242(6)(b), MCA.

While it is true that plaintiff had no direct contractual arrangement with AAC, AAC did, by necessary inference, enter into some agreement with Century to adjust claims made pursuant to plaintiff’s vehicle service contract with Arnlund. When it did so, it assumed the administrative responsibility formerly promised by MIA. It also impliedly agreed to handle those responsibilities in a manner consistent with Arnlund’s obligations under the contract.

It is plaintiff’s position that he was the intended beneficiary of AAC’s agreement to adjust claims consistent with Arnlund’s contractual obligations, and that as an intended beneficiary, he has the right to enforce those obligations against the promisor, AAC. We agree.

The rule regarding the rights of third-party beneficiaries to enforce contracts is accurately summarized at Restatement (Second) of Contracts § 304 (1981), where it provides that “[a] promise in a contract creates a duty in the promisor to any intended beneficiary to perform the promise, and the intended beneficiary may enforce the duty.”

The issue then is whether plaintiff was an intended beneficiary of AAC’s agreement to administer claims under the contract. The answer is found in Restatement (Second) of Contracts § 302 (1981), where intended beneficiaries are described as follows:

(1) Unless otherwise agreed between promisor and promisee, a beneficiary of a promise is an intended beneficiary if recognition of a right to performance in the beneficiary is appropriate to effectuate the intention of the parties and either
(a) the performance of the promise will satisfy an obligation of the promisee to pay money to the beneficiary; or
(b) the circumstances indicate that the promisee intends to give the beneficiary the benefit of the promised performance.

In this case, Century enlisted the services of AAC to adjust claims under Arnlund’s extended service agreement because of Century’s obligation to insure against those claims and possibly pay money to claimants like plaintiff. Therefore, we conclude that when AAC agreed to administer the plaintiff’s rights under the contract, the performance of its promise to do so satisfied an obligation of Century and Arnlund to plaintiff. And since AAC has exclusive authority to approve or disapprove claims under the contract, we also conclude that it is appropriate to recognize plaintiff’s right to performance in order to effectuate the intentions of the parties that plaintiff receive all benefits provided for under his contract with Arnlund.

For these reasons, we conclude that plaintiff was an intended third-party beneficiary of AAC’s agreement with Century, and he had a right to seek contract damages from AAC for its failure to perform its administrative responsibilities in accordance with his rights under the vehicle service contract. The District Court’s summary judgment is reversed and this case is remanded to the District Court for a factual determination of plaintiff’s rights under that contract.

UNFAIR TRADE PRACTICES ACT

The District Court found that there was no insurance contract entered into between plaintiff and either AAC or Century. Plaintiff does not disagree.

Century insured Arnlund, and AAC agreed with Century to administer and adjust claims made against Arnlund. Therefore, any claim by plamtiff against Century or AAC for their failure to handle his claim in accordance with the provisions of the Unfair Trade Practices Act found at § 33-18-201, MCA, is a third-party claim. Pursuant to § 33-18-242(6)(b), MCA:

A third-party claimant may not file an action under this section until after the underlying claim has been settled or a judgment entered in favor of the claimant on the underlying claim.

We agree with the District Court’s holding that pursuant to § 33-18-242, MCA, no claim under the Unfair Trade Practices Act can be brought against AAC or Century until plaintiff first asserts and resolves his claim on the underlying contract agamst AAC or Amlund. That part of the District Court’s summary judgment dismissing plaintiff’s claim pursuant to § 33-18-201, MCA, is affirmed.

For the foregoing reasons, the judgment of the District Court is affirmed in part, reversed in part, and remanded for further proceedings consistent with this opinion.

JUSTICES HARRISON and HUNT and DISTRICT JUDGE McCARTER sitting in place of JUSTICE GRAY concur.

JUSTICE WEBER

dissents as follows:

I dissent from the conclusion of the majority opinion that plaintiff was an intended third-party beneficiary of AAC’s (American Adjustment Company) agreement with Century (Century Indemnity Company) and had a right to seek contract damages from AAC for its failure to perform its administrative responsibilities in accordance with plaintiff’s rights under the Vehicle Service Contract (VSC).

Plaintiff purchased a 1986 Jeep Cherokee from Arnlund Automotive, Inc. d/b/a Arnlund Chrysler Plymouth Jeep (Arnlund). On August 29, 1986, plaintiff purchased a Vehicle Service Contract from Arnlund. The key part of the VSC is the following promise by Arnlund as dealer:

The Dealer [Arnlund] agrees that subject to all terms and conditions on the front of this Service Contract for the period indicated to make such repairs to the described vehicle as shall become necessary because of mechanical failure as defined herein.

The record does not demonstrate why Arnlund was not named as a party defendant. Plaintiff’s briefs suggest that the reason was because Arnlund was not the party making the decisions regarding the repair of plaintiff’s vehicle under the VSC.

The VSC showed it was administered by defendant MIA Services Contracts (MIA). In case of loss the pertinent provisions of the VSC are:

IN CASE OF LOSS
In the event of mechanical failure you may take your vehicle to any licensed repair facility. However, it is suggested that you take your vehicle back to the dealer from whom you purchased it. In your presence have the service manager contact the office of the administrator [MIA], ... You must contact the administrator before authorizing repairs ... No indemnity shall be payable under the service contract without authorization issued by the dealer [Arnlund] or administrator [MIA] prior to the repair or replacement of vehicle parts covered by this service contract.... The administrator [MIA]does not assume, and specifically disclaims any liability to you [plaintiff] for any benefits provided herein. The liability of the Administrator [MIA] is only to the Dealer [Arnlund] in accordance with their separate agreement.

Note that MIA as administrator was liable only to Arnlund as dealer and not to plaintiff. Plaintiff has named MIA as a party-defendant but because of the bankruptcy of MIA, it is not an active party.

The District Court in its Memorandum and Order made specific reference to the foregoing contractual provisions. The District Court made further reference to the contractual relationship between Arnlund and Century, stating:

In connection with the VSC Arnlund also had an “Automobile Extended Service Contract Policy” with Century. Arnlund was the insured and Century the insurer. ... Century agreed to insure Arnlund to pay under certain conditions and subject to some self insurance provisions “losses arising out of the reasonable and customary cost of repair or replacement under and in accord with the all of the terms of the extended service contracts issued by the insured [Arnlund] on or after the inception date of this policy”. ...

The District Court further established the relationship between various parties stating:

The deposition of Robert McCallister, the general manager of American [AAC] establishes the relationships between American [AAC], Century and related companies. When MIA filed bankruptcy Century took steps to protect consumers and itself concerning contracts it had insured such as the contract with plaintiff. ... Century is a wholly owned subsidiary of CIGNA. ... Century did not have an adjusting department and American [AAC] was used for that purpose. American was a previously dormant company revived for the purpose of adjusting the claims of dealers for which MIA had acted as administrator under VSC contracts. American is also a wholly owned subsidiary of CIGNA. Neither Century nor American were involved in any way in marketing any VSC contracts or the particular contract issued to plaintiff in 1986. ... (Emphasis supplied.)

The uncontradicted facts in the record establish that the District Court was correct in its above stated conclusions.

With further regard to AAC the District Court stated:

The only defendant who has appeared is American [AAC] which is the wholly owned subsidiary of CIGNA given the job of adjusting the VSC contracts administered by MIA-after its business failure. The reason American is adjusting the contracts is because of the automobile extended service contract policy written by Century, another wholly owned subsidiary of CIGNA. That policy names Arnlund as the insured and Century as the insurer. ...

It is important to emphasize the District Court’s further analysis and conclusions as follows:

Century’s sole involvement in this case is because of its automobile extended service contract policy written in favor of Arnlund where it has agreed to insure Arnlund for “losses arising out of the reasonable and customary costs of repair or replacement” under the VSC (McCallister Depo. Ex. 12). American’s sole involvement is its charge to adjust the claims for Century under previously issued VSC’s naming MIA as administrator after the business failure of MIA.
Under no theory are Century and American parties to the VSC who could be sued directly by plaintiff for breach of contract or breach of covenants running with the contract. The VSC is between plaintiff and Arnlund. Perhaps MIA could be held liable under the contract as the principal represented by its agent Arnlund but there is no theory whereby Century and American are themselves parties to the contract with plaintiff. (Emphasis added.)

The District Court emphasized that Century was involved only because of its policy written in favor of Arnlund. The uncontradicted record supports that conclusion. At this point I emphasize that AAC’s sole involvement was to adjust the claims for Century and Arnlund. As previously mentioned, AAC was not in any way administering the VSC in the manner in which MIA was required to do under the terms of the plaintiff-Arnlund VSC.

The deposition of Robert McCallister relied upon by the District Court establishes that CIGNA came to the realization that it was going to have to take over the obligation of adjusting the losses on contracts which were in existence with the public. Century and AAC both are wholly owned subsidiaries of CIGNA. The deposition established that Century arranged for the adjustment of its claims with Arnlund through AAC. The specific terms of that arrangement, whether oral or in writing, are not established in the record. The deposition further established that AAC had done nothing with regard to marketing, and was not in any way involved with VSC contracts such as that between plaintiff and Arnlund, with the exception only of the adjustment of claimed losses.

The majority opinion states as follows:

While it is true that plaintiff had no direct contractual arrangement with AAC, AAC did, by necessary inference, enter into some agreement with Century to adjust claims made pursuant to plaintiff’s vehicle service contract with Arnlund. When it did so, it assumed the administrative responsibility formerly promised by MIA. It also impliedly agreed to handle those responsibilities in a manner consistent -with Amlund’s obligations under the contract.

I find nothing in the record which establishes an assumption by AAC of any administrative responsibilities formerly promised by MIA. Clearly that is a reference to the VSC between plaintiff and Arnlund. There is nothing in the record to demonstrate that AAC assumed any administrative responsibilities under that VSC, and in particular nothing which demonstrates it was obligated to take the place of MIA. I find nothing in the record from which the opinion may conclude that AAC impliedly agreed to handle the responsibilities in a manner consistent with Arnlund’s obligation under the contract — again an apparent reference to Arnlund’s obligation to the plaintiff under his VSC.

After referring to the Restatement provisions, the majority opinion states as follows:

In this case, Century enlisted the services of AAC to adjust claims under Arnlund’s extended service agreement because of Century’s obligation to insure against those claims and possibly pay money to claimants like plaintiff. Therefore, we conclude that when AAC agreed to administer the plaintiff’s rights under the contract, the performance of its promise to do so satisfied an obligation of Century and Arnlund to plaintiff. And since AAC has exclusive authority to approve or disapprove claims under the contract, we also conclude that it is appropriate to recognize plaintiff’s right to performance in order to effectuate the intentions of the parties that plaintiff receive all benefits provided for under his contract with Arnlund.

The record does not support the conclusion that AAC agreed to “administer the plaintiff’s rights under the contract.” At most AAC agreed to adjust the claims made against Arnlund under the provisions of the contract between Arnlund and Century. That contract of course is not directly connected to the VSC contract between plaintiff and Arnlund. We find no record basis to conclude that AAC agreed to administer the plaintiff’s rights under the contract, by which I assume reference is made to the VSC between plaintiff and Arnlund.

Next the majority states that AAC has “exclusive authority” to approve or disapprove claims under the contract from which it concludes that it is appropriate to recognize plaintiff’s right of performance. The record does not support the conclusions that AAC had exclusive authority to approve or disapprove claims. Apparently the majority is referring to the provisions of the VSC between plaintiff and Arnlund which does provide that MIA must be contacted. There is nothing in the record to establish that AAC in any way assumed the responsibilities of MIA. As a result I disagree emphatically with the conclusion that it is appropriate to recognize plaintiff’s right to performance to effectuate the intentions of the parties. The record does not substantiate any intention that AAC should succeed to any of the obligations of MIA under the plaintiff-Arnlund VSC.

Next the majority opinion states:

For these reasons, we conclude that plaintiff was an intended third-party beneficiary of AAC’s agreement with Century, and he had a right to seek contract damages from AAC for its failure to perform its administrative responsibilities in accordance with his rights under the vehicle service contract.

I find no record basis for the foregoing conclusion. The record demonstrates that AAC did not have any obligation to perform administrative responsibilities of any type and in particular not under the VSC between plaintiff and Arnlund.

I conclude the record supports all of the findings and conclusions on the part of the District Court. I dissent from the opinion’s reversal of the summary judgment by the District Court. I would affirm the District Court.

CHIEF JUSTICE TURNAGE and JUSTICE McDONOUGH concur in the foregoing dissent.


author: JUSTICE HUNT

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. DOUGLAS ROBERT BROOKS, Defendant and Appellant.
    No. 93-033.
    Submitted on Briefs July 8, 1993.
    Decided August 24, 1993.
    50 St.Rep. 0967.
    260 Mont. 79.
    857 P.2d 734.
    For Defendant and Appellant: Lawrence LaFountain, Attorney at Law, Havre.
    For Plaintiff and Respondent: Hon. Joseph P. Mazurek, Attorney General, Elizabeth L. Griffing, Assistant Attorney General, Helena; David G. Rice, Hill County Attorney, Havre.
   JUSTICE HUNT

delivered the Opinion of the Court.

Appellant Douglas Robert Brooks was convicted of sexual assault following a jury trial and appeals from the judgment of the District Court of the Twelfth Judicial District, Hill County, claiming error in the court’s failure to suppress evidence of prior crimes.

We affirm.

The sole issue on appeal is whether the District Court erred in denying Brooks’ motion to suppress evidence of prior crimes. We analyze this issue under the modified Just rule, as set forth in State v. Matt (1991), 249 Mont. 136, 814 P.2d 52.

On March 23, 1992, Brooks was charged by information with a sexual assault on an 11-year-old victim, W.J., allegedly occurring on February 7, 1992, in Havre, Montana. On June 25,1992, as required by Matt, the State filed a notice informing Brooks that evidence of a prior sexual assault committed by Brooks would be introduced at trial. Brooks filed a motion to suppress this evidence. The District Court denied the motion. On August 25, 1992, a jury found Brooks guilty of sexual assault. Brooks appeals from the judgment on the issue of admission of the prior sexual assault.

The prior crime introduced in Brooks’ trial involved an incident that occurred before his move to Havre. In May 1989, Brooks took 13-year-old G.M. to Lake Chelan in Washington state where they engaged in recreational activities, including swimming, during the day. Later that evening, Brooks sexually assaulted G.M. In January 1990, Brooks was convicted in Washington of felonious sexual contact with a minor.

After moving to Havre, Brooks became employed as a maintenance man at a motel where he became friendly with the manager’s 10-year-old son, J.T. In addition to helping J.T. with his math, Brooks also accompanied him to the Havre city pool which was largely attended by 10 and 11-year-old boys. Brooks would frequently play with the boys in the pool by flipping them into the water. In fact, complaints were made to the pool management that Brooks was paying too much attention to the young boys. An off-duty police officer investigated these complaints and found that Brooks had a tendency to pay more attention to the young boys than to the girls at the pool.

One day Brooks took both J.T. and his friend, W.J., swimming at the pool. Brooks flipped the boys in the water, played several pool games and allowed them to ride on his back for about 30 minutes or an hour. According to W.J., Brooks approached him from behind and squeezed his buttocks, at which time W.J. swam away in order to inform J.T. Later on, according to W.J., Brooks approached him again, and this time squeezed W.J.’s penis. J.T. testified that Brooks later approached him also and squeezed his buttocks.

The next week, at J.T.’s birthday party, W.J. became upset when informed that Brooks might stop by. According to W.J., Brooks had asked him whether or not he intended to inform the police about the swimming pool incident, and W.J. answered that he would not. Brooks contends that W.J. approached him with sexual advances and that he merely tried to counsel W.J.

Did the District Court err in denying Brooks’ motion to suppress evidence of prior crimes?

As indicated, we will analyze this issue in light of the four-part modified Just rule that provides:

(1) The other crimes, wrongs or acts must be similar.
(2) The other crimes, wrongs or acts must not be remote in time.
(3) The evidence of other crimes, wrongs or acts is not admissible to prove the character of a person in order to show that he acted in conformity with such character; but may be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident.
(4) Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, misleading of the jury, considerations of undue delay, waste of time, or needless presentation of cumulative evidence.

Matt, 814 P.2d at 56.

Brooks’ actions show a systematic plan to entertain boys or adolescents in a recreational setting in which they feel comfortable and then, immediately or soon after, to catch them off-guard and unexpectedly sexually assault them. Although the time Brooks spent befriending G.M., J.T., and W.J. before sexually assaulting them varied with each victim, the plan was nonetheless systematic in that swimming or water games were used as a prelude to the assaults, and the boys were each in a vulnerable position because they wore fewer clothes while they were swimming, or in G.M.’s case, receiving a back rub, than they would have in a more formal setting.

Applying the first element of the modified Just rule to the case at bar, we conclude that the sexual assault committed by Brooks in Washington against G.M. is similar to the sexual assault committed against W.J. in Havre. As we stated in State v. Gilpin (1988), 232 Mont. 56, 64, 756 P.2d 445, 449, the prior act does not need to be identical to the charged offense. In the case at bar, the two acts are extremely similar.

Brooks took G.M. swimming at a lake in order to become closer to him. The sexual assault on G.M. occurred after the swim in the evening while Brooks gave G.M. a back rub which eventually turned into an excuse to nab G.M.’s buttocks and penis. In the incident involving J.T. and W. J., Brooks took both boys swimming at a pool in order to strengthen his friendship with J.T. and become better acquainted with W.J. During the water games, Brooks unexpectedly assaulted both J.T. and W.J.

The similarities are obvious. In both incidents, Brooks entertained the boys in a recreational setting around water and swimming as a prelude to his sexual assaults. Brooks claims that the acts are not similar because of the difference in location. We disagree. Although the assault of G.M. occurred after a swim, as opposed to the assault on W.J. which occurred while still in the water, both of the assaults occurred in or near swimming areas and after Brooks had engaged in recreational activities with the boys in order to appear to be their friend, and when the boys were more vulnerably dressed, either in swim clothing or bedtime clothing. Even though Brooks had just met W.J. and had only entertained him in the pool for a short time before assaulting him, W.J. assumed that Brooks could be trusted since Brooks had already gained the trust of W.J.’s close friend, J.T., by taking J.T. on recreational outings. Therefore, Brooks, through the trust he had already gained with J.T., was able to put W.J. at ease with less effort and, subsequently, take him by surprise with his sexual assault.

Brooks claims that he learned in therapy that he was only attracted to 13 and 14 year olds, rather than 10 and 11 year olds. The problem with this argument is that it focuses on age, as opposed to physical development. There is often no clear difference in physical development among children in this age range. Brooks failed to present specific evidence of any developmental differences between G.M. and W.J. that caused him to only be attracted to G.M. and not to W.J. G.M. had turned 13 just one month prior to the sexual assault in Washington state, while W.J. turned 11 soon after the sexual assault in Havre. The age difference between G.M. and W. J., without more explanation, is not sufficient to warrant a suppression of such a similar crime.

The District Court did not err in finding sufficient similarity in the two crimes to meet the first element of the modified Just rule.

Regarding the second element of the modified Just rule, nearness in time between the two crimes, we conclude that the three year time period between the prior crime and the assault against W. J. is not so great as to render the evidence of the prior crime inadmissible.

In State v. Medina (1990), 245 Mont. 25, 30, 798 P.2d 1032, 1036, we held that the range of three to five years between the prior conviction and the charged crime was “near enough in time to be considered probative.” Although the facts differ in the case at bar, when considering nearness of time, “each case must be examined in light of its unique set of facts.” Medina, 798 P.2d at 1036. In Medina, a case in which the victim of the prior and charged crime was the defendant’s daughter, in considering the remoteness of the prior crime, we took into account the fact that the defendant did not have the “opportunity” to be alone with the daughter for several years between the prior crime and the charged crime due to the strict rules imposed by the family. Medina, 798 P.2d at 1036. Similarly, in the case at bar, the defendant did not have the opportunity to be in contact with young or adolescent boys for over a year because he was incarcerated or under the supervision of the Washington State Department of Corrections. Defendants’ abstention from sexual abuse because of a lack of opportunity will not prevent this Court from taking into account a prior crime because of remoteness in time from the present crime.

The District Court did not err in finding that the prior crime was not too remote to be admitted under the second element of the modified Just rule.

The third element of the modified Just rule is that the evidence of crimes is admissible, among other reasons, to show a tendency to establish a common scheme, plan, or system, as opposed to being admissible to prove the character of a person in order to show action in conformity therewith. Brooks’ tendency, as a prelude to sexual assault, to entertain young boys in a recreational setting in order to make them feel comfortable, and then catch them off-guard by sexually assaulting them, constitutes a common scheme or plan as noted above.

The District Court did not err in finding that Brooks developed a common scheme to an extent appropriate to admit the prior crime under the third element of the modified Just rule.

Finally, analysis of the fourth element of the modified Just rule, leads us to conclude that the probative value of the prior crime is not outweighed by the prejudice to the defendant. Although it is inevitable that the introduction of a prior crime will have some prejudicial effect on a defendant, we held in State v. Eiler (1988), 234 Mont. 38, 51, 762 P.2d 210, 218, that when the prior crime meets the first three elements of the Just rule, these elements combine to give “great probative weight to the evidence of prior acts.” Accordingly, we conclude that because the prior crime met the first three elements of the Just rule and the modified Just rule, the cumulative effect is that the probative value outweighs the prejudice to Brooks.

We hold that the District Court did not err in denying Brooks’ motion to suppress evidence of prior crimes. We affirm.

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


author: CHIEF JUSTICE TURNAGE

text:
    STATE OF MONTANA, Plaintiff and Appellant, v. GARY LEE BARKER, Defendant and Respondent.
    No. 93-113.
    Submitted on Briefs July 20, 1993.
    Decided August 24, 1993.
    50 St.Rep. 0970.
    260 Mont. 85.
    858 P.2d 360.

      For Plaintiff and Appellant: George H. Corn, Ravalli County Attorney, Gerald D, Williams, Deputy Ravalli County Attorney, Hamilton.
    For Defendant and Respondent: David E. Stenerson, Attorney at Law, Hamilton.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

The District Court for the Twenty-First Judicial District, Ravalli County, vacated a justice court’s ruling which found appellant Barker guilty of reckless driving, on the grounds that the defendant had not been charged with reckless driving' The District Court further held that any retrial for the offense of driving under the influence of alcohol would violate defendant’s constitutional protection against double jeopardy. The State appeals. We affirm.

The issues are:

1. Does a district court have authority to vacate a justice court decision when the prosecution charged the defendant with driving under the influence of alcohol, and the justice court found the defendant guilty of reckless driving?

2. Does a district court have authority to dismiss an appeal from a justice court decision on the grounds that the appellate issues are barred by the defendant’s Fifth Amendment protection against double jeopardy?

Following a February 8, 1992 accident on Highway 93 near the Rustic Hut Bar in Florence, Montana, Ravalli County Sheriff’s officers arrested Gary Lee Barker and subsequently charged him with driving under the influence of alcohol, in violation of § 61-8-401, MCA, and operating a motor vehicle without seatbelts in use, in violation of § 61-13-103, MCA. Barker entered pleas of not guilty to both charges and waived his right to a jury trial.

The Ravalli County Justice of the Peace found Barker guilty of the seatbelt violation and guilty of reckless driving, in violation of § 61-8-301, MCA. In finding the reckless driving violation, the Justice Court reasoned that reckless driving is a lesser included offense of driving under the influence of alcohol.

The Justice Court denied Barker’s motion to set aside the judgment, and sentenced Barker accordingly. Upon Barker’s motion, the sentence imposed for reckless driving was stayed pending appeal to the District Court. Barker paid a fine for the seatbelt violation, and does not further challenge that charge.

Barker appealed to the District Court and then filed a motion to dismiss the case. He argued that reckless driving is not a lesser included offense of driving under the influence of alcohol, and that a retrial on the original driving under the influence of alcohol charge is barred by the double jeopardy protection provided under the Fifth Amendment of the United States Constitution. The State argued that unless Barker pleaded guilty under the provisions of § 46-12-204, MCA (plea alternatives), the District Court must hold a trial de novo on the all the issues.

The District Court vacated the reckless driving charge; dismissed the driving under the influence of alcohol complaint with prejudice; and affirmed the seatbelt violation.

I

Does a district court have authority to vacate a justice court decision when the prosecution charged the defendant with driving under the influence, and the justice court found the defendant guilty of reckless driving?

Our standard of review relating to conclusions of law is to determine whether the tribunal’s interpretation of the law is correct. Steer, Inc. v. Dep’t of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d 601, 603.

Criminal justice in Montana is subject to the mandates of the United States Constitution, the Montana Constitution, and statutory law. The Sixth Amendment of the United States Constitution guarantees accused defendants the right to be informed of the nature and cause of the accusation. The Montana Constitution, Article II, § 24, similarly provides that an accused shall have the right to demand the nature and cause of the accusation. Section 46-11-401, MCA, provides:

The charge must be a plain, concise, and definite statement of the offense charged, including the name of the offense, whether the offense is a misdemeanor or felony, the name of the person charged, and the time and place of the offense as definitely as can be determined. The charge must state for each count the official or customary citation of the statute, rule, regulation, or other provision of law that the defendant is alleged to have violated.

The charge of driving under the influence of alcohol required proof that the defendant had physical control of a vehicle while under the influence of an intoxicating substance. Section 61-8-401, MCA. A reckless driving charge requires proof that the defendant operated a vehicle in willful or wanton disregard for the safety of persons and property. Section 61-8-301, MCA. Clearly the two charges are inapposite; reckless driving is not a lesser included offense of driving under the influence of alcohol. Cf. § 46-11-410, MCA (when same transaction establishes multiple offenses, multiple charges are possible) and State v. Ritchson (1981), 193 Mont. 112, 630 P.2d 234 (possible to charge and convict defendant of multiple offenses when each offense requires at least one separate element which distinguishes it from other charged offenses).

By convicting Barker of reckless driving when the State did not charge him with that offense, the Justice Court violated Barker’s constitutional right to due process of law. See U.S. Const, amend. XIV; Art. II, § 17, Mont. Const. The finding of guilt should be set aside as Barker did not have notice of the nature and cause of the offense. See State v. Copenhaver (1907), 35 Mont. 342, 89 P. 61 (judgment reversed on appeal after defendant was charged with one crime and erroneously convicted of another).

After reviewing the record we conclude that the Justice Court was in error when it convicted Barker of reckless driving. “It is elementary that a party cannot be charged with one offense and convicted of another independent offense.” State v. Seiffi 1917), 54 Mont. 165, 168, 168 P. 524, 524. We therefore affirm the District Court’s order vacating the reckless driving charge.

II

Does a district court have authority to dismiss an appeal on the grounds that the charges are protected by the defendant’s Fifth Amendment protection against double jeopardy?

The burden of proof for overturning the District Court decision is on the State, as the appellant. Whether to grant or deny a motion to dismiss at the close of the State’s case is within the sound discretion of the trial court and will not be disturbed unless an abuse of that discretion is shown. State v. Laster (1986), 223 Mont. 152, 159-60, 724 P.2d 721, 726. As was stated in Raster, “[i]n this case with regard to the dismissal of the cause on grounds of double jeopardy, we adopt the usual standard that the State has the burden to show abuse of discretion by the District Court.” Laster, 724 P.2d at 726.

The State argues that the District Court must hear the appeal from the Justice Court, as provided by the Montana Constitution and statutory law. Barker argues that a subsequent trial for driving under the influence is barred by the constitutional protection against double jeopardy.

The State refers to the Montana Constitution, Article VII, Section 4(2), which states “[t]he district court shall hear appeals from inferior courts as trials anew unless otherwise provided by law.” Construing that provision, the District Court especially noted the “unless otherwise provided by law” language. Additionally, the court referred to § 3-5-303, MCA, which provides for district court appellate jurisdiction over justice court decisions “as may be prescribed by law and consistent with the constitution.”

The court then reviewed the constitutional double jeopardy protection provided to all criminal defendants:

The Double Jeopardy clauses of the U.S. and the Montana constitutions provide that no person shall be “twice put in jeopard/’ for the “same offense.” U.S. Constitution, Fifth Amendment, Montana Constitution, Article II, § 25. Since Benton v. Maryland, 395 U.S. 784 [89 S.Ct. 2056, 23 L.Ed.2d 707] (1969), the Double Jeopardy clause of the Fifth Amendment applies to the states via the Fourteenth Amendment as a “fundamental right.” In this bench trial case, jeopardy attached when the first State’s witness was sworn by the Justice of the Peace. [See] Crist v. Bretz, 437 U.S. 28 [98 S.Ct. 2156, 57 L.Ed.2d 24] (1978). Once jeopardy attached, any retrial for the same offense presents potential Double Jeopardy difficulties.

While it is true that a defendant’s statutory remedy for appealing a justice court decision is a trial de novo in district court, it is also true that the constitutional protection against double jeopardy forbids a retrial on charges of which a defendant has been acquitted before a competent court which had authority and jurisdiction to try the offense. Section 46-17-311, MCA; Art. II, § 25, Mont.Const. (“No person shall be again put in jeopardy for the same offense previously tried in any jurisdiction”) (emphasis added).

The Justice Court is a court of competent jurisdiction. Art. VII, § 5, Mont.Const.; § 46-2-202, MCA; § 3-10-303, MCA. Jeopardy attached when the State swore in its first witness in the Justice Court. See Crist v. Bretz (1978), 437 U.S. 28, 98 S.Ct. 2156, 57 L.Ed.2d 24. When the Justice Court first tried Barker for driving under the influence of alcohol it instead found him guilty of reckless driving, necessarily implying that there was insufficient evidence to convict Barker of driving under the influence of alcohol as a matter of law. Section 46-ll-503(a), MCA (“There is an acquittal whenever ... there is insufficient evidence to warrant a conviction”); see also Green v. United States (1957), 355 U.S. 184, 78 S.Ct. 221, 2 L.Ed.2d 199 (defendant’s jeopardy for first degree murder came to an end when the jury found him guilty of second degree murder).

Barker appealed the reckless driving conviction. The right to appeal a justice court decision is purely statutory. State v. Speith (1990), 244 Mont. 392, 394, 797 P.2d 221, 222, citing State v. Hartford (1987), 228 Mont. 254, 256, 741 P.2d 1337, 1338. A defendant may appeal a justice court decision to the district court, § 46-17-311, MCA; the prosecution may only appeal a justice court decision as provided "under § 46-20-103, MCA. State v. Kesler (1987), 228 Mont. 242, 245, 741 P.2d 791, 793.

We have previously stated that a defendant’s exclusive remedy for a conviction in justice court is an appeal to the district court for trial de novo. Kesler, 741 P.2d at 793; Adair v. Lake County Justice Court (1984), 213 Mont. 466, 692 P.2d 13 (Supreme Court does not have appellate jurisdiction to review orders of the justice court; appeal to district court for trial de novo is defendant’s exclusive remedy). This is the general rule for defendants appealing convictions from justice court. The purpose for a trial de novo is to provide defendant with a competent remedy in a court of record.

An exception to the general rule exists, however, where a defendant appeals a conviction for which he or she was not charged. Barker was not charged with reckless driving; he was charged, and acquitted, of driving under the influence of alcohol. When the District Court was faced with the untenable position of trying Barker again for driving under the influence of alcohol, it correctly held that to do so would violate Barker’s constitutional protection against double jeopardy. U.S. Const, amends. X, XIV; Art. II, § 25, Mont.Const.; § 46-11-504, MCA (former prosecution bars subsequent prosecution in a different jurisdiction if the first prosecution resulted in an acquittal or a conviction, and the subsequent proceeding is based on the same offense or transaction). By appealing the reckless driving conviction, Barker did not waive his constitutional protection against double jeopardy for the charge of driving under the influence of alcohol.

The same-elements or Blockburger test bars multiple prosecutions based on the same offense. United States v. Dixon (1993), _ U.S. _, 113 S.Ct. 2849, 125 L.Ed.2d 556, citing Blockburger v. United States (1932), 284 U.S. 299, 52 S.Ct. 180, 76 L.Ed 306. Here, the State failed to obtain a conviction for driving under the influence of alcohol in Justice Court. That proceeding barred any retrial of the driving under the influence of alcohol charge based on Barker’s February 8, 1992 accident. See State v. Furlong (1984), 213 Mont. 251, 258, 690 P.2d 986, 989-90, citing Burks v. United States (1978), 437 U.S. 1, 11, 98 S.Ct. 2141, 2147, 57 L.Ed.2d 1, 9-10; State v. Matt (1990), 245 Mont. 208, 214-15, 799 P.2d 1085, 1089, citing State v. Hall (1986), 224 Mont. 187, 728 P.2d 1339, rev’d on other grounds (1987), 481 U.S. 400, 107 S.Ct. 1825, 95 L.Ed.2d 354, per curiam; State v. Houser (1981), 192 Mont. 164, 168, 626 P.2d 256, 258 (same transaction rule bars retrials concerning the same conduct tried before a competent court of adequate jurisdiction). The State is therefore prohibited from again placing Barker in jeopardy for driving under the influence of alcohol.

We conclude that any retrial on the driving under the influence of alcohol charge is barred by the United States and Montana Constitutions. Where, as here, the defendant appeals from an erroneous conviction for an uncharged offense, the defendant does not waive the constitutional protection against double jeopardy for charges of which he was acquitted. The State has not met its burden of proof; the District Court ruling is affirmed.

JUSTICES HUNT, TRIEWEILER, NELSON and WEBER concur.