author: JUSTICE McDONOUGH JUSTICE HARRISON JUSTICE TRIEWEILER

text:
    MARGARET MAGUIRE, Individually and as Guardian of MARY MARGRETTA GLOVER, an Incapacitated Person and BABY GLOVER, Plaintiffs and Respondents, v. THE STATE OF MONTANA, MONTANA DEPARTMENT OF INSTITUTIONS, THE MONTANA DEVELOPMENTAL CENTER AND CARROLL V. SOUTH, Director of Department of Institutions, Defendants and Appellants.
    No. 91-313.
    Submitted Mar. 10, 1992.
    Decided Aug. 12, 1992.
    49 St.Rep. 688.
    835 P.2d 755.
    254 Mont. 178.

      For Defendants and Appellants: Sam E. Haddon argued, Boone, Karlberg & Haddon, Missoula; G. Curtis Drake, Keller, Reynolds, Drake, Sternhagen & Johnson, Helena.
    For Plaintiffs and Respondents: William P. Joyce argued, Burgess, Joyce & Whelan, Butte.
   JUSTICE McDONOUGH

delivered the Opinion of the Court.

The State of Montana appeals a jury verdict in favor of Margaret Maguire, individually and as guardian of Mary Margretta Glover and from a judgment of the Second Judicial District Court, Silver Bow County. We affirm in part and reverse in part.

We address the following issues on appeal:

1. Whether the District Court erred in granting partial summary judgment and in directing a verdict that the State was liable for criminal conduct of an employee under Restatement (Second) of Agency § 214;

2. Whether the District Court erred in refusing the State’s offer of proof, based on Rule 408, M.R.Evid., that Mrs. Maguire acknowledged that Ms. Glover was receiving good care at the Montana Developmental Center and that she should not be moved;

3. Whether the District Court erred in refusing to instruct on the theories of agency and negligent hiring;

4. Whether the District Court erred in allowing Mrs. Maguire to maintain an action in tort for emotional distress; and

5. Whether the District Court erred in refusing to reduce the jury’s verdict.

In 1988, Mary Margretta Glover (Glover) an autistic and severely retarded patient at Montana Developmental Center (MDC), was assaulted and raped by an MDC employee, Lloyd Dean Drummond. Ms. Glover, age 43, has resided at what is now MDC since 1979. In

1988, MDC assigned Lloyd Drummond the primary responsibility for caring for Ms. Glover. His duties included bathing and dressing Ms. Glover.

Margaret Maguire (Maguire), Ms. Glover’s mother and legal guardian, brought Ms. Glover home for weekend visits. During one of the visits, Ms. Glover laid flat on her back, spread her legs, and placed her knees up towards her shoulders. During another visit, Mrs. Maguire noticed Ms. Glover was gaining weight. Mrs. Maguire telephoned MDC personnel to question them about Ms. Glover’s weight gain. She also inquired as to whether or not Ms. Glover was having regular menses. She was informed that Ms. Glover had missed her menses, but that it was probably due to thorazine treatment. However, MDC staff members also noticed Ms. Glover’s weight gain and commented to the head nurse that they wished to be the first ones to tell Lloyd Drummond that he was going to be a father.

In November of 1988, a pregnancy test on Ms. Glover came back positive. Ms. Glover delivered the baby without incident in April of 1989. As Ms. Glover’s legal guardian, Mrs. Maguire had to make decisions regarding her daughter’s pregnancy. Fear that Ms. Glover’s autism and retardation might be congenital made a decision to carry the pregnancy to term difficult. Further, Mrs. Maguire was concerned for her daughter’s safety. As a devout Roman Catholic, making a decision to abort the pregnancy was also very difficult. Ultimately Mrs. Maguire decided to have the pregnancy carried to term. However, she faced another difficult decision in whether to raise the child herself or place the child in an adoptive home. In view of her advanced age, she finally decided to place the child with adoptive parents.

In December of 1988, Mrs. Maguire sought medical attention for stress and depression related to the rape and pregnancy of her daughter. Her physician, who previously treated Mrs. Maguire for depression and anxiety related problems, noted her stress had increased and that she had deteriorated “markedly.” She complained of trouble sleeping, nightmares, contemplation of suicide, and generally feeling run down. Mrs. Maguire’s visits to the doctor increased, and her condition did not begin to improve until April of 1989, but she continued to see a psychologist through 1990.

Our standard of review as to the verdict is whether there is substantial credible evidence in the record to support the jury verdict. In reviewing conclusions of law, question of law, or legal components of ultimate facts, or mixed questions of law and fact, we will decide if the lower court’s determination as to law is correct. The scope of review of discretionary acts of the trial court is whether the trial court abused its discretion. Our review will be plenary. Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 803 P.2d 601.

I

Whether the District Court erred in granting partial summary judgment and directing a verdict holding the State liable for the criminal conduct of its employee, based on Restatement (Second) of Agency, § 214.

The District Court granted partial summary judgment and directed a verdict in favor of Mrs. Maguire and Ms. Glover on the issue of liability. The District Court based its decision on Restatement (Second) of Agency § 214. Section 214 is an exception to the general rule of respondeat superior. We have not heretofore adopted this section. This section provides:

Failure of Principal to Perform Non-delegable Duty.
A master or other principal who is under a duty to provide protection for or to have care used to protect others or their property and who confides the performance or such duty to a servant or other person is subject to liability to such others for harm caused to them by the failure of such agent to perform the duty.

We have previously analyzed cases -under the respondeat superior doctrine based on Restatement (Second) of Agency § 228. Respondeat superior imposes liability on an employer for the wrongful acts of an employee which are committed within the scope of his employment. As we stated in Kornec v. Mike Horse Mining (1947), 120 Mont. 1, 8, 180 P.2d 252, 256:

The servant or agent must have been acting in the “course of his employment,” in “furtherance of his employer’s interest,” or “for the benefit of his master;” “in the scope of his employment,” etc. But a servant who acts entirely for his own benefit is generally held to be outside the scope of his employment and the master is relieved of liability. (Citation omitted.)

See also Lutz v. United States (9th Cir. 1982), 685 F.2d 1178.

A party may be held vicariously hable for the damages caused by another on the theory of respondeat superior or may be held directly liable on the theory of negligent hiring and/or supervision. Normally, an employer would not be held liable for tortious acts of its employee performed outside the scope of employment. Hoover v. University of Chicago Hospitals (Ill. 1977), 366 N.E.2d 925, 929. Thus, under respondeat superior, the employer’s liability is derivative from the negligent acts of the employee acting within the scope of employment. Boykin v. District of Columbia (D.C.App. 1984), 484 A.2d 560, 561. It is clear this rape was outside the scope of Lloyd Drummond’s employment.

Other jurisdictions, under theories of vicarious liability, hold an employer liable for the tortious acts of its employees acting outside the scope of employment. These cases involve common carriers and innkeepers. In G.L. v. Kaiser Foundation Hospitals (1987), 88 Or.App. 528, 746 P.2d 731, 734, the Oregon Court of Appeals deferred to the legislature in declining to hold hospitals strictly hable for tortious acts of employees acting outside the scope of employment (sexual assault). The question of an employer’s vicarious liability for the tortious acts of its employees acting outside the scope of employment is a matter of first impression in Montana.

Both appellant and respondent cite cases from other jurisdictions which produce opposite results. MDC relies on Rabon v. Guardsmark, Inc. (4th Cir. 1978), 571 F.2d 1277. In Rabon, the Fourth Circuit held that neither South Carolina common law nor South Carolina statutes justify application of the non-delegable duty rule of § 214 to the employer of a security guard (rape). The Fourth Circuit found that South Carolina only recognized the non-delegable duty exception to the general rule of respondeat superior in cases involving common carriers. Rabon at 1280.

Mrs. Maguire relies on Stropes v. Heritage House Childrens Ctr. (Ind. 1989), 547 N.E.2d 244, for her analysis that Montana should adopt the non-delegable duty exception to the respondeat superior doctrine. Stropes involves a similar fact situation. In Stropes a severely retarded fourteen-year-old boy was raped by a nurse’s aide employed by Heritage House. The aide’s duties included feeding, bathing, and changing the child. The rape occurred after the aide entered the boy’s room to change his clothing and bedding. Stropes at 245.

The Indiana Supreme Court, in reviewing Indiana case law, found two cases which held employers hable for criminal acts of their employees, because the acts “originated in activities so closely associated with the employment relationship as to fall within its scope.” Stropes at 247.

The Siropes court also distinguished Rabón. As noted above, the Fourth Circuit determined that South Carolina’s non-delegable duty doctrine only extended to common carriers. Stropes at 250-251. However, as Siropes pointed out, Indiana has identified principles underlying its adoption of the exception, and, in fact, has extended it to reach enterprises other than common carriers. Stropes at 252. The Indiana Supreme Court concluded that the relevant relationships embodied in the common carrier exception, and the rationales underlying it, were applicable to Heritage. Stropes at 253-254.

Montana follows the doctrine of respondeat superior as expounded in Kornec. We have not adopted the common carrier exception to that doctrine. However, we have accepted the concept of a non-delegable duty in a contractual relationship between a general contractor and an independent contractor. Ulmen v. Schwieger et al. (1932), 92 Mont. 331, 12 P.2d 856. Ulmen involved a highway contract. We concluded that there was a non-delegable duty based on the inherently dangerous and hazardous nature of the project to the public. Ulmen at 347, 12 P.2d at 859. In Ulmen this duty was extended to third parties.

Later, we held that a general contractor had a non-delegable duty to the employee of a subcontractor based on a statutory duty to maintain safety at the worksite. Stepanek v. Kober Const. (1981), 191 Mont. 430, 625 P.2d 51. Stepanek involved a construction injury after a fall from a scaffold. In Cash v. Otis Elevator (1984), 210 Mont. 319, 684 P.2d 1041, this Court adopted a higher standard of care for the owner of a premises with respect to operation of an elevator. We determined that an elevator performs the function of a common carrier and that the owner of the elevator had a non-delegable duty as to the safety of the elevator because elevators are inherently dangerous. Cash at 324, 684 P.2d at 1043.

In summary, we have limited application of the non-delegable duty exception to the respondeat superior doctrine to instances of safety where the subject matter is inherently dangerous. We decline to extend the exception to the facts here. There are a number of reasons for and against extending the liability of the employer, such as here, when an intentional tort is committed only because of or by virtue of the employment situation. The employer is better able to attempt to avoid such wrongs. The employer has the ability to minimize them, while the victim has no control over the situation. Such a burden is incidental to running a business. However, such a major change to the respondeat superior doctrine is best left to the legislature.

Massachusetts declined to extend the non-delegable duty exception to group day care centers because it would constitute a significant extension of Massachusetts law. Worcester Ins. v. Fells Acres Day School (1990), 408 Mass. 393, 558 N.E.2d 958, 968. (Rape and indecent assault.) Likewise creating a major exception to the respondeat superior doctrine, by extending liability to a caretaker, would constitute a significant extension of Montana law. Without support of prior judicial decisions, such an extension of liability should come from the legislature. See Sandman v. Hagan (Iowa 1968), 154 N.W.2d 113, 118-119. We conclude that the District Court erred in its determination to apply § 214 of the Restatement (Second) of Agency to the facts here. We reverse the District Court on this issue. Inasmuch as we are reversing on the first issue, our discussion of the balance of the issues is advisory for the purpose of a second trial.

II

Whether the District Court erred in refusing the State’s offer of proof, based on Rule 408, M.R.Evid., that Mrs. Maguire acknowledged Ms. Glover was receiving good care at the Montana Developmental Center and that she should not be moved.

Rule 408, M.R.Evid., provides:

Compromise and offers to compromise.
Evidence of (1) furnishing or offering or promising to furnish, or (2) accepting or offering or promising to accept, a valuable consideration in compromising or attempting to compromise a claim which was disputed as to either validity or amount is not admissible to prove liability for or invalidity of the claim or its amount. Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require exclusion of any evidence otherwise discoverable merely because it is presented in the course of compromise negotiations. This rule also does not require exclusion when the evidence is offered for another purpose, such as proving bias or prejudice of a witness, negativing a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.

Based on Rule 408, the District Court excluded testimony from defendant’s witness, Jennifer Pryor, that Mrs. Maguire did not want Ms. Glover moved from MDC. MDC cites the commissioners’ comments to the Rule that parties should not try to immunize their evidence from being admissible by presenting it during negotiations. The third sentence of the Rule allows evidence which is otherwise discoverable.

MDC sought to introduce testimony that Mrs. Maguire did not want Ms. Glover moved from MDC because it was close to Butte and that she thought Ms. Glover was receiving good care at MDC. Moreover, evidence existed that Mrs. Maguire rejected an offer of alternative placement for Ms. Glover during settlement negotiations. Counsel for MDC admitted that placement outside of MDC was part of the proposed settlement.

Further, Mrs. Maguire testified on cross-examination that MDC was the best place she could find for her daughter and that she wanted to keep her close to Butte. Thus, proposed testimony by MDC was repetitive. We conclude the evidence does not fall within the exception offered by MDC in the commissioners’ comments. For the reasons stated above, we affirm the District Court on this issue.

Ill

Whether the District Court erred in refusing to instruct on the theories of agency and negligent hiring.

Because the District Court adopted the non-delegable duty exception to the respondeat superior doctrine, it refused MDC’s proposed instructions on negligent hiring and agency. We concluded above that the District Court erred in adopting the non-delegable duty exception to Montana’s respondeat superior doctrine. Thus, we reverse the District Court on this issue.

Section 53-20-142, MCA, provides in part:

Persons admitted to a residential facility for a period of habilitation shall enjoy the following rights:
(1) Residents have a right to dignity, privacy, and humane care...

MDC has a statutory duty to Ms. Glover not inconsistent with the theories of negligent hiring, negligent supervision, and agency. Thus it was error for the District Court to refuse instructions based on these theories.

IV

Whether the District Court erred in allowing Mrs. Maguire to maintain an action in tort for emotional distress.

The District Court limited Mrs. Maguire’s recovery for emotional distress to those damages caused by being required to make the decisions regarding the pregnancy of Ms. Glover. The jury was instructed not to award damages for emotional distress as a result of Mrs. Maguire’s learning of her daughter’s rape and pregnancy. This latter instruction was correct. In the past we have allowed recovery to a third party for contemporaneous observance of an accident or event resulting in shock to the senses. Versland v. Caron Transport (1983), 206 Mont. 313, 671 P.2d 583.

In Versland we traced the history of case law from a denial of recovery for damages for emotional trauma if there was no physical impact to an expansion to the “zone of danger” rule. The “zone of danger” rule allows the plaintiff recovery if he or she were located within the zone of defendant’s negligent conduct and feared for his or her own safety. We abandoned this rule using the reasoning of the seminal case of Dillon v. Legg (1968), 68 Cal.2d 728, 69 Cal.Rptr. 72, 441 P.2d 912. In Versland, we adopted guidelines derived from Dillon, and articulated a three part test for third party claims for negligent infliction of emotional distress:

1. The shock must result from a direct emotional impact upon the plaintiff from the sensory and contemporaneous perception of the accident, as contrasted with learning of the accident from others after its occurrence.
2. The plaintiff and victim must be closely related, as contrasted with absence of any relationship or the presence of only a distant relationship.
3. Either death or serious physical injury of the victim must have occurred as a result of the defendant’s negligence.

Wersland at 322, 671 P.2d 583.

Part (1) of this test is in line with, and an amplification of, prong 2(a) of Section 46 of the Restatement of Torts relative to intentional and reckless conduct. This is sometimes referred to as the tort of outrage. See Lund v. Caple (1984), 100 Wash.2d 739, 675 P.2d 226. Restatement (Second) of Torts § 46 provides:

(1) One who by extreme and outrageous conduct intentionally or recklessly causes severe emotional distress to another is subject to liability for such emotional distress, and if bodily harm to the other results from it, for such bodily harm.
(2) Where such conduct is directed at a third person, the actor is subject to liability if he intentionally or recklessly causes severe emotional distress
(a) to a member of such person’s immediate family who is present at the time, whether or not such distress results in bodily harm, or
(b) to any other person who is present at the time, if such distress results in bodily harm.

The case before us fails to meet part one of the Versland three part test and part 2 of § 46 of the Restatement in that Mrs. Maguire, the plaintiff herein, was not present at the time of the conduct. She learned of the conduct from others. The policy behind the presence requirement is to limit the number of persons who may recover for emotional distress and to guarantee the genuineness of the claim. See Marlene F. v. Psychiatric Med. Clinic (Cal. 1989), 257 Cal.Rptr. 98, 770 P.2d 278, 285. J.J. Arguelles and Eagleson concurring.

The theory submitted to the jury was whether or not Mrs. Maguire may recover for damages for emotional distress for being required to make decisions regarding the pregnancy of her daughter; those decisions being whether or not the daughter should have an abortion and if not, to provide for the care or adoption of the child. No direct-relationship exists between any outrageous act and Mrs. Maguire. To find an independent cause of action here goes beyond the rationale and tests of the Dillon and Versland progeny and goes beyond the physical presence requirement.

We have allowed recovery for emotional distress absent physical injury in only limited circumstances. In Johnson v. Supersave Markets, Inc. (1984), 211 Mont. 465, 686 P.2d 209 and Niles v. Big Sky Eyewear (1989), 236 Mont. 455, 771 P.2d 114, we allowed recovery for emotional distress damages for false imprisonment in jail. In both Johnson and Niles the victim was not a third party.

A caveat to § 46 provides: “The Institute expresses no opinion as to whether there may not be other circumstances under which the actor may be subject to liability for the intentional or reckless infliction of emotional distress.” As Justice Arguelles points out, the caveat speaks to situations which may not mandate the presence requirement. Marlene F. at 105, 770 P.2d at 285, quoting § 46 com. 1, p. 79. In Marlene F the California Supreme Court held a mother of a child could state a claim for negligent infliction of emotional distress after a psychologist treating both the mother and child, sexually molested the child. Marlene F at 103, 770 P.2d at 283. The comb reasoned that damages are recoverable when the defendant owes a duty of care to the plaintiff. The existence of the duty depends upon the foreseeability that severe emotional distress will result from the breach of that duty. Marlene F at 101-102, 770 P.2d at 281-282.

Justice Eagleson, in his concurring opinion in Marlene F, points out that the relationship between the psychotherapist and patient gives rise to a duty to refrain from conduct that foreseeably will harm the patient. He also points out that an earlier decision permitted a husband a cause of action for emotional distress after a doctor misdiagnosed his wife as having syphilis. The husband was not present at the diagnosis. Marlene F at 108, 770 P.2d at 288, citing Molien v. Kaiser Foundation Hospitals (1980), 167 Cal.Rptr. 831, 616 P.2d 813. In Molien the court reasoned that the doctor assumed a duty to the husband when he directed the wife to communicate the diagnosis to him, thus it was foreseeable to the doctor that a misdiagnosis would cause the husband emotional distress. Molien at 835, 616 P.2d at 817. In reality, the plaintiffs in Molien and Marlene F could be considered “direct victims” of the tortious conduct.

Relying on Marlene F, the California Supreme Court distinguished the bystander-witness cases of the Dillon progeny. In Christensen v. Superior Court (1991), 2 Cal.Rptr.2d 79, 91, 820 P.2d 181, 193, certain mortuaries and crematoria wrongfully mishandled the decedents’ remains. Despite failing to satisfy the presence requirement, family members were allowed standing to recover for negligent infliction of emotional distress. Christensen at 99, 820 P.2d at 201. The defendants assumed a duty to the close relatives of the decedents for whose benefit they were to provide services. Further, the court reasoned that the defendants “created a special relationship with the close family members obligating them to perform those services in a dignified and respectful manner.” Christensen at 91, 820 P.2d at 193.

We are faced with the question here whether the facts before us satisfy the causation and the foreseeability requirements when the presence requirement is not met. In our view, doing so here would increase the spiral of liability farther out than other jurisdictions have chosen to go. See H.L.O. by L.E.O. v. Hossle (Iowa 1986), 381 N.W.2d 641, 644-645; Nancy P. v. D’Amato (Mass. 1988), 401 Mass. 516, 517 N.E.2d 824, 828.

In the case before us, MDC did not assume a duty towards Mrs. Maguire. The existence of a duty of care depends upon the foreseeability of the risk and upon a weighing of policy considerations for and against the imposition of liability. See Slaughter v. Legal Process and Courier Service (1984), 162 Cal.App.3d 1236, 1249, 209 Cal.Rptr. 189, 196. The facts before us are not sufficiently similar to the duty the doctor assumed in Molien by instructing the wife to inform her husband about the diagnosis. Nor is it analogous to the special relationship created between the psychotherapist and patient in Marlene F. The fact situation in Christensen comes the closest to the facts before us. However, while the morticians and crematoria assumed a duty to the close relatives (of the decedents) for whose benefit they were performing funeral and related services, MDC did not assume such a similar duty to Mrs. Maguire. There was no close connection between the extreme and outrageous acts and Mrs. Maguire’s injury. She is neither a “direct victim,” nor was she present at the time of conduct, nor a victim under specific special parasitic circumstances.

We therefore decline to extend liability to allow Mrs. Maguire to recover for either negligent infliction of severe emotional distress or intentional infliction of severe emotional distress. We reverse the District Court on this issue.

V

Whether the District Court erred in refusing to treat the separate recoveries as a single claim of damages under § 2-9-108, MCA.

Under § 2-9-108, MCA, the legislature imposed a $750,000 limit on each claim against the State. Section 2-9-108, MCA (1991) (temporary), states in part:

(1) Neither the state, a county, municipality, taxing district, nor any other political subdivision of the state is liable in tort action for damages suffered as a result of an act or omission of an officer, agent, or employee of that entity in excess of $750,000 for each claim and $1.5 million for each occurrence.

The rape and subsequent pregnancy were the subjects of Mrs. Maguire’s original complaint. During the trial, Drummond admitted to raping Ms. Glover on two additional occasions.

Under § 2-9-108, MCA, a party is entitled to $750,000 for each claim. We agree with the District Court that each rape was a separate wrongful act. We conclude that the District Court did not err in refusing to treat the recoveries as based on a single claim.

MDC also contends that the verdict forms were improper. The jury did not separate its damage award among the separate claims. The District Court found that MDC raised the limitation of § 2-9-108, MCA, as a defense in its amended answer and jury demand. Further, the District Court found that it was MDC’s responsibility to present a verdict form which would allow the jury to apportion its damage award applying § 2-9-108, MCA. We agree with the District Court that the responsibility rested with MDC to present separate verdict forms; we therefore affirm the District Court on this issue.

For the reasons stated above, we affirm in part and reverse in part and remand to the District Court for proceedings not inconsistent with this opinion.

CHIEF JUSTICE TURNAGE and JUSTICES GRAY and WEBER concur.

JUSTICE HARRISON

specially concurring.

I concur in the result reached by majority in this opinion holding that the District Court erred in granting partial summary judgment based on Restatement (Second) of Agency § 214. As noted in the opinion, this Court has not previously adopted this section as law in Montana and, in my opinion, it is unfortunate that the District Court did in this case.

In concurring with the result of this case, I do not in any manner approve, condone or support the apparent indifferent hiring practices employed by the State of Montana in this case. The fact situation of this case clearly illustrates the unconcerned hiring practices implemented by the State — it is appalling that it clearly took little or no interest in the character or integrity of this defendant who was hired to care for our disabled or disadvantaged. The State’s investigation of potential employees should have prevented the hiring of such a man, who, during the course of his employment with the State of Montana, brought discredit not only to himself and to the institution but also to the other employees of that institution who are devoted and who truly care for our unfortunate citizens. The citizens of this State who suffer the misfortune of having family members in such institutions deserve both the peace of mind and the assurance that their loved ones are safe and well cared for.

JUSTICE TRIEWEILER

dissenting; joined by JUSTICE HUNT.

I dissent from the opinion of the majority.

The opinion of the majority is a tragic and misguided decision which once again demonstrates that, given a choice, the majority would protect the State rather than its citizens.

This Court has now elevated the trust that people place in common carriers, such as buses and elevators, to a more important status than the trust that Montana citizens have a right to place in the public institutions that were created to protect societys most vulnerable people.

Greta Glover developed a severe mental disorder at the age of four years. She has been variously diagnosed as autistic, schizophrenic, and retarded. As a result of her condition, she is incapable of communicating with other people.

She has been institutionalized for the past 30 years, and has been a resident of the Montana Developmental Center (MDC) in Boulder, Montana since 1972. Her care was entrusted to Montana’s Department of Institutions because her mother, who cared for her until the age of 12, was no longer able to do so.

MDC exists to house, supervise, care for, and train Montana’s disabled citizens. Its residents are mentally and physically handicapped to the extent that they cannot care for themselves. These are truly societys most vulnerable people.

MDC hired Lloyd Dean Drummond to take care of Greta. He was responsible for her day-to-day care and protection, including all personal hygiene and bathing. He testified that in the course of caring for her, he sexually assaulted her by fondling her three to four times per week, and he raped her on three separate occasions. Because of her mental condition, Greta was unable to communicate and report this abuse to any other person. She was totally dependent on the care provided for her at MDC.

The majority opinion is based upon this Court’s previous decision in Kornec v. Mike Horse Mining Co. (1947), 120 Mont. 1, 180 P.2d 252, where we held that an employer is not vicariously liable for the torts of his employee when that employee’s conduct is outside the scope of his employment.

The modern rule of respondeat superior, and the exception on which the majority relies, are set forth in Restatement (Second) of Agency § 219 (1958). That section provides as follows:

(1) A master is subject to liability for the torts of his servants committed while acting in the scope of their employment.
(2) Amaster is not subject to liability for the torts of his servants acting outside the scope of their employment, unless:
(a) The master intended the conduct or the consequences, or
(b) The master was negligent or reckless, or
(c) The conduct violated a nondelegable duty of the master, or
(d) The servant purported to act or to speak on behalf of the principal and there was reliance upon apparent authority, or he was aided in accomplishing the tort by the existence of the agency relation. [Emphasis added.]

Respondeat superior is a common law principle. The majority relied on the common law to establish an exception to respondeat superior. See Kornec, 180 P.2d at 256-57. Furthermore, this Court has previously, by common law, established duties which are nondelegable. See Cash v. Otis Elevator Co. (1984), 210 Mont. 319, 684 P.2d 1041.

Why then has the majority suddenly decided that it is appropriate to come to a screeching halt in the evolution of the common law under these circumstances which so compellingly cry out for its logical extension?

Nondelegable duties are clearly an exception to the principle relied upon by the majority. Restatement (Second) of Agency § 214 (1958), provides that the duty assumed by the defendants in this case was nondelegable. It states as follows:

A master or other principal who is under a duty to provide protection for or to have care used to protect others or their property and who confides the performance of such duty to a servant or other person is subject to liability to such others for harm caused to them by the failure of such agent to perform the duty.

Section 214 is directly applicable to the facts presented in this case. The MDC was under a duty to provide for the protection and care of Greta Glover. It cannot avoid responsibility for failure to perform that duty by delegating it to Lloyd Dean Drummond.

The concept of nondelegable duty is not foreign to our common law. In Cash, we found that the owner of an elevator has a duty to exercise the highest degree of care in its maintenance and that that duty cannot be delegated to an independent contractor because of the potential danger if the elevator is not safely maintained. We did not defer to the legislature where the legislature had failed to act. We should not do so in this case.

Greta Glover was every bit as vulnerable, once placed under the care of the State of Montana, as people are who enter elevators or entrust their passage to other common carriers.

I agree with the decision of the Indiana Supreme Court in Stropes v. Heritage House Children’s Center (Ind. 1989), 547 N.E.2d 244. That case presented facts identical to the facts in this case. The victim was a 14-year-old boy who, because of severe mental retardation and insufficient verbal skill, was unable to care for himself. He was, therefore, placed in a home for children as a ward of the county welfare department to assure his security and well-being. While there, he was sexually molested by a nurse’s aide who was responsible for his care.

The victim’s guardian filed a complaint for damages against the home to which he was entrusted. However, the trial court granted summary judgment on the basis that:

[T]he act of committing a sexual assault was, as a matter of law, outside the scope of Robert Griffin’s employment and, as a result, plaintiff cannot recover against The Heritage House, Inc. based upon a theory of respondeat superior.

Stropes, 547 N.E.2d at 246.

In other words, that case was dismissed by the trial court on the same basis that this case was reversed by the majority.

The Indiana Supreme Court characterized the issue on appeal as: [Wlhether, as a matter of law, Heritage may be subject to liability for its employee’s wrongful acts under the doctrine of respondeat superior as traditionally applied or under a theory of liability which has been described as the “common carrier” or “nondelegable duty” exception to respondeat superior.

Stropes, 547 N.E.2d at 247.

After careful consideration, the Indiana Supreme Court concluded that it was appropriate to extend the “common carrier” or “nondelegable duty” exception to respondeat superior to the circumstances in that case. As pointed out, we have already adopted a “common carrier” exception to the principles of respondeat superior. The only issue before us is whether to extend it to the circumstances in this case.

In language relevant to the issue before us, the Indiana Supreme Court concluded:

An examination of the relevant relationship here against the template of the common carrier exception and the rationales underlying it reveals that Heritage clearly assumed a nondelegable duty to be responsible for the care and safety of David Stropes. When Heritage accepted David as a result of its facility, it was fully cognizant of the disabilities and infirmities he suffered which rendered him unable to care for himself and which, in fact, undoubtedly formed the basis of their relationship. Their “contract of passage” contemplated that the entire responsibility for David’s comfort, safety and maintenance would be on Heritage and that the performance of these tasks would be delegated to its employees. Given the degree of David’s lack of autonomy and his dependence on Heritage for care and the degree of Heritage’s control over David and the circumstances in which he found himself, we find that Heritage assumed a non-delegable duty to provide protection and care so as to fall within the common carrier exception. The standard of care which Heritage owed to David, therefore, was that actual care be used by Heritage and its employees to provide that protection. The trial court was in error to summarily reject his claim that such a duty existed.

Stropes, 547 N.E.2d at 253-54.

I would likewise conclude that given the degree of Greta’s dependence on the State of Montana for her care and the degree of control that is exercised over her, MDC assumed a nondelegable duty to provide for her protection and care and that it violated that duty when she was raped and sexually abused while in the State’s custody and care.

Contrary to the concerns expressed by the majority, such a holding would be totally consistent with the directives that have been enacted by the legislature. Section 53-20-101(1), MCA, which sets forth the purpose of Montana’s chapter pertaining to the developmentally disabled, states that:

The purpose of this part is to:

(1) secure for each person who may be developmentally disabled such treatment and habilitation as will be suited to the needs of the person and to assure that such treatment and habilitation are skillfully and humanely administered with full respect for the person’s dignity and personal integrity .... [Emphasis added.]

Section 53-20-142, MCA, in that same chapter, provides that:

Persons admitted to a residential facility for a period of habilitation shall enjoy the following rights:
(1) Residents have a right to dignity, privacy, and humane care.
(8) Each resident has a right to a humane physical environment within the residential facility.
(10) Corporal punishment is not permitted.

Section 53-20-163, MCA, provides in relevant part as follows:

(1) Every residential facility shall prohibit mistreatment, neglect, or abuse in any form of any resident.

In their concern for deference to the legislature, the majority have actually defeated the express intentions of the legislature. These statutory obligations are meaningless if the State of Montana and MDC can avoid liability for breaching the duties these statutes impose by simply contending that the duty was breached by one of the State’s employees. The State has no way of acting other than through its employees.

The majority’s rationale is that protection of people like Greta Glover is not our responsibility — it is up to the legislature.

It is true that where the legislature has preempted the common law, this Court should defer to that branch of government. However, it is equally clear that where the legislature has not acted to regulate the affairs of people, this Court has an obligation to do so through the common law. This obligation is made clear by both our previous decisions and legislative statute. See Haker v. Southwestern Railway Co. (1978), 176 Mont. 364, 578 P.2d 724, and § 1-1-108, MCA.

The majority’s expressed concern about acting in an area that should be reserved for the legislature is indeed a shallow basis for this result. It has shown no similar reluctance in the past under much less compelling circumstances.

The common law of this State is replete with examples of this Court’s willingness to act where a vacuum exists in an important area of public policy that involves the rights of the litigants who appear before us. This Corut adopted the law of strict liability without waiting for the legislature to do so in Brandenburger v. Toyota (1973), 162 Mont. 506, 513 P.2d 268. It allowed damages for loss of consortium by minors in Pence v. Fox (1991), 248 Mont. 521, 813 P.2d 429. This Court rewrote the law regarding bad faith in commercial transactions without waiting for the legislature to do so in Story v. City of Bozeman (1990), 243 Mont. 436, 791 P.2d 767. In fact, this Court originally adopted the very exception to respondeat superior that forms the basis of this decision without waiting for the legislature to do so. Kornec v. Mike Horse Mining Co. (1947), 120 Mont. 1, 180 P.2d 252. Why is the majority willing to adopt by common law part of the rule on respondeat superior which is set forth in Restatement (Second) of Agency § 219 (1958), but unwilling to adopt the rest of that same rule by the same process?

This Court was willing to adopt a rule of nondelegable duty for owners of elevators, and presumably other common carriers, such as buses, trains, and ski lifts. Cash v. Otis Elevator Co. (1984), 210 Mont. 319, 684 P.2d 1041. Why is it any significant departure from what was done in Cash to extend the same protection to an autistic, retarded woman incapable of protecting herself or communicating with others when she has been sexually abused by the employees of the very institution in which she was placed for her protection and care?

I agree with Justice Benjamin Cardozo, who stated in his treatise, Law and Literature (1931), “[t]he common law, unless bound and riveted by statute, has instruments at hand of many varieties and shapes for molding of that justice which is the end of her endeavor.”

This Court is willing to use the common law selectively where it suits the majority’s notions of sound public policy. However, it has abdicated that important responsibility in this case.

The primary reason for which an independent branch of government, such as the judiciary, exists is to protect the rights of private individuals from governmental abuse. There can be no clearer example of governmental abuse than when one of its agents sexually abuses and rapes a retarded woman who had been placed in the government’s care and entrusted to the government for her protection. I, therefore, dissent from the majority’s decision to reverse the District Court’s determination of the defendant’s liability.

I also dissent from that part of the majority opinion which holds that Margaret Maguire was not a direct victim of Dean Drummond’s tortious conduct, and therefore, cannot recover damages for the emotional distress she has experienced.

Margaret Maguire is Greta Glover’s mother and legal guardian. She cared for her daughter until Greta was 12 years of age, when she was no longer able to do so. After her daughter was admitted to state institutions, Margaret visited her frequently and took her home on weekends.

On November 16, 1988, she was advised that her daughter was pregnant. Her daughter was incapable of deciding what to do about the pregnancy. Therefore, Margaret had to make those decisions for her. Margaret literally substituted herself for Greta in terms of all the difficult decisions that are attendant to an unwanted pregnancy. She was concerned about Greta’s health and was concerned about whether Greta could deliver a healthy baby. Yet, because of her religious beliefs, she could not choose an abortion. In the process of making these decisions, her health deteriorated and she required both psychological and medical treatment.

After the baby was bom on April 4, 1989, she had to make the decision to place the baby for adoption, just as if it was her own child. Following the decision to have the baby adopted, she was hospitalized for depression with symptoms of starvation and thoughts of suicide. Her doctors related these severe health problems to the decisions she was forced to make about Greta’s pregnancy and the adoption of the baby.

If any person with the intellectual capacity to make her own decisions was raped and suffered physically and mentally, as Margaret Maguire did because of the decisions that had to be made following that rape, there is no question that person would be entitled to compensation for those emotional and physical injuries. Margaret Maguire was no less a direct victim of Dean Drummond’s conduct than Greta Glover.

In Johnson v. Supersave Markets, Inc. (1984), 211 Mont. 465, 686 P.2d 209, we held that:

This Court adopts the species of case approach which requires a factual analysis of each case to determine whether the alleged “emotional distress” merits compensation. In determining whether the distress is compensable absent a showing of physical or mental injury, we will look to whether tortious conduct results in a substantial invasion of a legally protected interest and causes a significant impact upon the person of the plaintiff.

Johnson, 686 P.2d at 213.

The instruction given to the jury regarding Margaret Maguire’s right to recover damages for her own emotional distress was completely consistent with our directive in Johnson. The jury was instructed as follows:

If you find that the State of Montana was responsible in causing Margaret Maguire emotional distress, the plaintiff, Margaret Maguire, may be entitled to recover damages. You are instructed that Margaret Maguire had a right to be free from the emotional distress caused by being obligated to make decisions regarding the pregnancy of her daughter and ward, Greta Glover. Before damages for emotional distress may be awarded, you must find that the defendant, State of Montana, substantially invaded that right and that this invasion caused a significant impact upon the plaintiff, Margaret Maguire, and resulted in severe emotional distress.

The majority cites to Marlene F. v. Psychiatric Med. Clinic (Cal. 1989), 770 P.2d 278, and Molien v. Kaiser Foundation Hospitals (Cal. 1980), 616 P.2d 813. In both of these cases, plaintiffs were entitled to claim damages for emotional distress, even though they were not the direct victim of the negligent conduct which gave rise to their claims. The basis for recovery in both cases was that they were owed a duty of care by the tort-feasor. The majority concludes that the existence of that duty “depends upon the foreseeability that severe emotional distress will result from the breach of that duty.” Certainly, on that basis, the State of Montana owed a duty to Margaret Maguire in this case. Not only did she entrust her daughter to them with the understanding that they would provide for her care and security, but it was obvious to the employees of MDC that it was Margaret Maguire who necessarily made every decision that affected Greta Glover’s personal life. How could it not be foreseeable that if Greta Glover was raped and impregnated, that Margaret Maguire would be left with all of the decisions made necessary because of that pregnancy?

The majority decision is disturbing on several levels. First, and most importantly, it unnecessarily deprives the plaintiffs, who have suffered so much from such brutal treatment by the agents of the State, from the necessary compensation with which they could begin putting their lives back together. Second, it sets a terrible precedent which will be applied to bar future victims of intentional abuse by State employees from reasonable compensation, no matter how serious and devastating their loss. Finally, this Court’s decision regarding Margaret Maguire’s damages, creates the fiction that Margaret Maguire was not a direct victim of Dean Drummond’s brutal conduct. This decision ignores the reality of this lady’s unique situation and this family’s terrible suffering.

For these reasons, I dissent from Parts I, III, and IV of the majority decision. I would affirm the judgment of the District Court.

JUSTICE HUNT joins in the foregoing dissent of JUSTICE TRIEWEILER.


source: Caselaw Access Project

author: JUSTICE HARRISON

license: Public Domain

text:
    WAYNE V. KELLY, Petitioner and Appellant, v. STATE COMPENSATION MUTUAL INSURANCE FUND/BELT PUBLIC SCHOOLS, Defendant, Employer and Respondent.
    No. 91-484 and 91-575.
    Submitted on briefs May 7, 1992.
    Decided Aug. 13, 1992.
    49 St.Rep. 699.
    835 P.2d 774.
    254 Mont. 200.

      For Petitioner and Appellant: Antonia P. Marra, Bell & Marra, Great Falls.
    For Defendant and Respondent: William O. Bronson, James, Gray & McCafferty, Great Falls.
   JUSTICE HARRISON

delivered the Opinion of the Court.

Claimant and appellant, Wayne V. Kelly (Kelly), appeals from two judgments of the Workers’ Compensation Court which ruled in favor of the insurer, State Compensation Mutual Insurance Fund (the State Fund). We affirm.

FACTS

Kelly suffered three injuries arising out of and in the course of his employment while working as a bus driver for the Belt School District. Kelly injured his neck on May 14, 1986; his back on November 11, 1986; and his neck again on November 21, 1987. At the time of Kelly’s injuries, his employer was insured under Plan III of the Workers’ Compensation Act.

In addition to driving the Belt Public School bus, Kelly participated in various concurrent employment situations. He was a vendor/stock-er for Frito-Lay and Nabisco food companies, a theater projectionist and manager, a bagger/carry-out at Malmstrom Air Force Base Commissary, and a self-employed wood cutter. As a result of his May 1986 injury, Kelly was unable to work ten weeks during the summer of 1986. Kelly lost no time from work as a result of the November of 1986 injury. Kelly failed to return to any of his occupations following the November 21, 1987, injury.

As a result of the 1987 injury, Kelly received temporary total disability benefits from November of 1987 until early June of 1990 when his benefits were terminated because the Vocational Rehabilitation Specialist designated by the State Fund determined that Kelly could obtain alternative employment.

The Workers’ Compensation Court found Kelly permanently partially disabled as a result of the November 1987 injury. Kelly receives impairment benefits, retroactive to September 1988, for his thirty-five percent impairment rating. Kelly also receives wage supplements in addition to his impairment award. The Social Security Administration also determined that Kelly was eligible for social security disability benefits.

PROCEDURAL HISTORY

This case is before us on consolidated appeals. First, as a result of Kelly’s November 21, 1987, injury, the State Fund designated a rehabilitation provider to evaluate Kelly’s rehabilitation options pursuant to § 39-71-1012, MCA(1987). The provider determined that the appropriate option for Kelly was to “return to a related occupation suited to the claimant’s education and marketable skills.” Section 39-71-1012(c), MCA (1987). Kelly contested this determination and the Department of Labor and Industry (the Department) designated a rehabilitation panel to review the provider’s recommendation. The panel issued a report in accord with the provider’s initial determination. The Department held a hearing, at Kelly’s request, to review the panel’s determination. On December 28, 1990, the Department entered its Findings of Fact, Conclusions of Law, and Order concurring in the panel’s findings. Kelly appealed the Department’s order to the Workers’ Compensation Court which affirmed the Department’s Order on September 12, 1991. Kelly appeals that decision to this Court.

Second, Kelly filed a separate petition for a hearing before the Workers’ Compensation Court to resolve disputes related to his 1986 injuries. This petition also referenced matters concerning the 1987 injury. The court held the hearing on March 1, 1991, and issued its Findings of Fact, Conclusions of Law, and Order on September 12, 1991, denying all of the relief Kelly requested. The Workers’ Compensation Court ruled: that Kelly is permanently partially disabled; that Kelly reached maximum healing after the May of 1986 injury but prior to the November of 1987 injury; that the State Fund is not required to pay permanent partial disability benefits to Kelly for the 1986 injuries; that Kelly is not entitled to any lump sums; that Kelly is not entitled to an impairment award for the 1986 injuries; and that Kelly is not entitled to a penalty or attorney fees. Kelly appeals that decision to this Court.

ISSUES

Kelly presents several issues for our review which we rephrase as follows:

1. Whether substantial credible evidence supported the Workers’ Compensation Court’s finding that Kelly reached maximum healing after the May 1986 injury but prior to the November of 1987 injury.

2. Whether substantial credible evidence supports the Workers’ Compensation Court’s findings that Kelly is permanently partially disabled, rather than permanently totally disabled, as a result of the 1987 injury and that § 39-71-1012(c), MCA (1987), was the appropriate rehabilitation option for Kelly.

3. Whether the Workers’ Compensation Court erred in denying Kelly’s request for the court to assess penalties and award Kelly attorney fees?

STANDARD OF REVIEW

This Court has set forth the appropriate standard of review in appeals from the Workers’ Compensation Court. This Court’s function is not to reweigh the evidence. Our function is to determine if the Workers’ Compensation Court’s findings of fact and conclusions of law are supported by substantial credible evidence in the record. We will uphold the Workers’ Compensation Court’s decision if substantial credible evidence supports it. Nelson v. Semitool, Inc. (1992), 252 Mont. 397,_, 829 P.2d 1, 3.

I.

Whether substantial credible evidence supported the Workers’ Compensation Court’s finding that Kelly reached maximum healing after the May 1986 injury but prior to the November of 1987 injury.

The underlying question in this appeal is whether Kelly’s May 1986 or his 1987 injury proximately caused his current disability. Both the State Fund and Kelly agree that Kelly suffered injuries to the cervical area of his spine on two separate occasions. The parties disagree as to which injury caused his present disability. The State Fund maintains, and the Workers’ Compensation Court agreed, that Kelly reached maximum healing after the May 1986 injury but prior to the November 1987 injury, rendering the November 1987 injury the cause of Kelly’s present disability. Kelly contends that the 1987 injury merely aggravated his May of 1986 injury, rendering the May 1986 injury the cause of his present disability. If the lower court determined that the May 1986 injury proximately caused the current disability, Kelly would be entitled to more benefits than if the court determined that the 1987 injury proximately caused his current disability. Lee v. Group W Cable TCI of Montana (1990), 245 Mont. 292, 295, 800 P.2d 702, 704.

The evidence in this case supports the Workers’ Compensation Court’s decision that Kelly reached maximum healing after the May 1986 injury, but prior to the 1987 injury, rendering the law in effect in 1987 applicable. Kelly missed only ten weeks of work following the May 1986 injury. He returned to work at all but one of his concurrent employment situations until the 1987 injury, nearly one and one-half years later when he discontinued all employment.

Kelly contends that the lower court’s finding that he reached maximum healing before the 1987 injury was not supported by substantial credible evidence. We disagree. The rule in Belton v. Carlson Transport (1983), 202 Mont. 384, 385-86, 658 P.2d 405, 406, controls this situation even though Belton dealt primarily with the issue of which insurance carrier is at risk when a worker suffers more than one compensable work-related injury. Belton’s maximum healing rule can be applied in cases such as the one at bar to determine which injury proximately caused the claimant’s current disability. Lee, 245 Mont. at 296, 800 P.2d at 705.

The lower court was presented with medical testimony supporting its decision that Kelly reached maximum healing prior to the 1987 injury.

Maximum healing means that following a compensable injury a claimant has reached a point constituting the end of a healing period. It does not mean the person is free of symptoms such as pain or objective signs.

Stangler v. Anderson Mayers (1987), 229 Mont. 251, 255, 746 P.2d 99, 101, citing Belton v. Carlson Transport (1983), 202 Mont. 384, 658 P.2d 405. The record before us includes testimony from Dr. Verson Kirk and Dr. William Labunetz. After a follow-up visit in August 1987, Dr. Kirk reported that Kelly was functioning well and had been stable for approximately one year. Additionally, Dr. Labunetz, who began treating Kelly in September 1987, reported that Kelly was not disabled from driving the Belt Public School bus at that time, approximately two months prior to the November 1987 injury which prevented Kelly from participating in any of his employment situations.

The Workers’ Compensation Court found that the doctors’ testimony indicated that Kelly reached maximum healing following the May 1986 injury. Although Kelly missed work for approximately ten weeks after the May 1986 injury, he eventually returned to all of his occupations with one exception; he discontinued his employment with Nabisco. Kelly indicated that he continued to experience pain while he engaged in his employment. However, Kelly also testified that the 1987 injury was far worse than the May 1986 injury. Based on the foregoing, we hold that substantial credible evidence exists to conclude that Kelly reached maximum healing prior to the 1987 injury. Therefore, Kelly’s 1987 injury proximately caused his present disability and the Workers’ Compensation Court did not err in so holding.

II.

Whether substantial credible evidence supports the Workers’ Compensation Court’s findings that Kelly is permanently partially disabled, rather than permanently totally disabled, as a result of the 1987 injury and that § 39-71-1012(c), MCA (1987), was the appropriate rehabilitation option for Kelly.

Kelly contends that the evidence supports a finding of permanent total disability rather than permanent partial disability. Section 39-71-116(15), MCA (1987), defines permanent total disability as:

[A] condition resulting from injury as defined in this chapter, after a worker reaches maximum healing, in which a worker is unable to return to work in the worker’s job pool after exhausting all options set forth in 39-71-1012.

In order to qualify as permanently totally disabled, Kelly was required to show that after exhausting all options in § 39-71-1012, MCA (1987), that he remained unable to return to work in his job pool. Kelly failed to meet this burden.

Section 39-71-1012, MCA (1987), sets forth the appropriate rehabilitation options:

Rehabilitation goal and options. (1) The goal of rehabilitation services is to return a disabled worker to work, with a minimrun of retraining, as soon as possible after an injury occurs.
(2) The first appropriate option among the following must be chosen for the worker:
(a) return to the same position;
(b) return to a modified position;
(c) return to a related occupation suited to the claimant’s education and marketable skills;
(d) on-the-job
(e) short-term retraining program (less than 24 months);
(f) long-term retraining program (48 months maximum); or
(g) self-employment.
(3) Whenever possible, employment in a worker’s local job pool must be considered and selected prior to consideration of employment in a worker’s statewide job pool.

Section 39-71-1012, MCA (1987). A worker’s job pool includes jobs available for which a worker is qualified, consistent with the worker’s age, education, vocational experience and aptitude, and physical limitations. Section 39-71- 1011(7)(a), MCA (1987).

After Kelly’s 1987 injury, he failed to return to any of his prior employment situations. Since the explicit goal of the Workers’ Compensation Act in 1987 was to return workers to employment situations with minimal retraining, § 39-71-1012, MCA (1987), the State Fund designated a rehabilitation specialist to evaluate Kelly. The specialist determined that option (c) under § 39-71-1012, MCA(1987), was the appropriate option. Option (c) states that Kelly should return to a related occupation suited to his education and marketable skills. This decision was affirmed by the appointed rehabilitation panel, the Department of Labor and Industry, and the Workers’ Compensation Court. Kelly maintains this decision was error as he is unable to return to work due to pain and inability to perform tasks for more than a couple of hours at a time.

In the instant case, Kelly’s doctors, therapists, the rehabilitation specialist, and a Rehabilitation Panel determined that Kelly could engage in light duty work. Based upon Kelly’s age education, experience, aptitude, physical capabilities and limitations, various job position descriptions were selected as those that Kelly could perform. This list included positions as a central office operator, a bookkeeper II, a receptionist and a clerk/typist. Kelly’s own physician reviewed these job descriptions and approved them all except for the clerk/typist position, indicating that Kelly should have brief breaks from sitting if performing this job. We note that Kelly took a typing test at Job Service and during a five minute time span typed fifty words-per-minute with two errors.

Further, the record reflects that due to discrepancies in Kelly’s reported restrictions and limitations, two private investigators monitored Kelly’s activities. The private investigators observed and video-taped Kelly involved in various activities including: driving a car, bending, stooping, unloading wood, operating a tractor, and pushing a car by hand. Additionally, the private investigators indicated that Kelly made numerous trips on rough unkept mountain roads driving a flatbed truck loaded with wood. These trips sometimes lasted over several hours which Kelly successfully accomplished. After reviewing the record, we find that substantial credible evidence supports the court’s findings.

III.

Whether the Workers’ Compensation Court erred in denying Kelly’s request for the court to assess penalties and award Kelly attorney fees?

Kelly asserts that the lower court erred in refusing to impose a penalty on the insurer and in failing to award his costs and attorney fees. Kelly argues that the State Fund’s adjustment of his claims was unreasonable. Kelly argues that the State Fund acted unreasonably in failing to disburse Kelly’s impairment award immediately after he was given an impairment rating in 1988. However, Kelly failed to present evidence that the State Fund unreasonably refused to pay the impairment award.

Additionally, Kelly contends that the Workers’ Compensation Court erred in refusing to award his costs and attorney fees. In some cases, if the claimant is successful against the insurer, the claimant is allowed costs and attorney fees. Sections 39-71-611 and -612, MCA (1987). As Kelly was unsuccessful below and on appeal, he is not entitled to costs and attorney fees. Substantial credible evidence exists supporting the lower court’s denial of penalties, costs, and attorney fees. Therefore, we cannot overturn its decision. Affirmed.

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


author: JUSTICE McDONOUGH

text:
    AETNA LIFE INSURANCE COMPANY, Plaintiff and Respondent, v. LAWRENCE EDWARD JORDAN; LAWRENCE EMMETT JORDAN, a/k/a Larry Jordan, a/k/a Larry E. Jordan; HELEN K. JORDAN, a/k/a Helen Jordan, Defendants and Appellants, and FIRST NATIONAL BANK OF HYSHAM; The Partnership of MARV HUISMAN, LES BROECK and DOUG STRANGELAND; CHUCK KANANEN; and CENTRAL ELECTRIC SERVICE, Defendants.
    No. 92-008.
    Submitted on briefs June 4, 1992.
    Decided Aug. 13, 1992.
    49 St.Rep. 703.
    835 P.2d 770.
    254Mont. 208.

      For Defendants and Appellants: Craig D. Martinson, Billings. For Plaintiff and Respondent: John G. Crist, Dorsey & Whitney, Billings.
    For Defendants: James A. Patten, Patten Law Firm; Michael B. Anderson, Holland & Hart, Billings; Timothy J. O’Hare, and James L. Stogsdill, Lewistown.
   JUSTICE McDONOUGH

delivered the Opinion of the Court.

Lawrence Edward Jordan, Lawrence Emmett Jordan and Helen K. Jordan appeal from an order of the Tenth Judicial District, Fergus County, in favor of Aetna Life Insurance Company. We affirm and remand.

The issues presented on appeal are:

1. Whether the District Court erred in granting summary judgment in favor of Aetna, without a hearing;

2. Whether the District Court erred in granting Lawrence Emmett Jordan and Helen K. Jordan occupancy of the house during the redemption period and in granting Aetna Life Insurance Company the income from the rented mortgaged premises dining the redemption period; and

3. Whether the District Court erred in granting Aetna Life Insurance company the CRP payments from the mortgaged premises during the redemption period when Jordans, subsequent to the mortgage, assigned their interest to a third party.

On December 15, 1983, Lawrence Emmett Jordan and Helen K. Jordan, husband and wife, and Lawrence Edward Jordan (Jordans) executed a promissory note in the principal sum of $1,400,000, payable to Aetna Life Insurance Company (Aetna). The note was secured by a mortgage covering certain real property in Fergus County, Montana. Jordans executed a Mortgage Deed Security Agreement, and finance statement. The documents were recorded and filed with the Fergus County Clerk and Recorder on December 16, 1983.

The Jordans defaulted on the payment required under the Note and Mortgage. On July 3, 1985, Aetna brought an action to foreclose the Note and Mortgage against the Jordans. On June 30, 1987, the Jordans filed bankruptcy under Chapter 11, which stayed the foreclosure proceedings. A plan of reorganization was approved on April 3, 1989. The Jordans defaulted on the plan. Aetna amended their foreclosure complaint on November 3,1990. Aetna filed a motion for summary judgment on May 24, 1991. On August 7, 1991, Aetna filed its motion requesting the order granting summary judgment. The District Court ruled in favor of Aetna. This appeal followed.

I

Whether the District Court erred in granting summary judgment in favor of Aetna, without a hearing.

The District Court granted Aetna’s motion for summary judgment, entering judgment on August 13, 1991, two months after Aetna’s motions and briefs were filed. The District Court was advised that the Jordans did not intend to file a response. Under Rule 2(b) of the Uniform District Court Rules, failure to provide an answer brief within ten days is deemed an admission that the motion is well taken. The District Court relied on Rule 2(b). The Jordan’s contend that under Rule 56(c), M.R.Civ.R, a hearing must be held with a 10 day notice to the opposing party.

Rule 56(c), M.R.Civ.R, provides in part:

The motion shall be served at least 10 days before the time fixed for the hearing. The adverse party prior to the day of hearing may serve opposing affidavits ...

Jordans rely on Cole v. Flathead County (1989), 236 Mont. 412, 771 P.2d 97, for the proposition that an oral argument is required for summary judgment unless it is specifically waived by all parties.

In Cole we held that the procedure to be followed on motions for summary judgment -must conform to the provisions of Rule 56, M.R.Civ.P. Cole at 417, 771 P.2d at 100. In our discussion of the interplay between Rule 56, M.R.Civ.P., and Rule 2, Montana Uniform District Court Rules, we said:

[T]he essential question for the District Court in deciding a motion for summary judgment either for the plaintiff or for the defendant is whether there exists a genuine issue of material fact. That inquiry does not admit of decision merely on a technical point, such as whether briefs have been filed on time.

Cole at 416, 771 P.2d at 100.

In the case before us, the District Court reviewed Aetna’s motion and memorandum together with the supporting affidavits. The District Court found that the motion was properly supported by appropriate factual evidence, and that Aetna was entitled to summary judgment foreclosing the note and mortgage as a matter of law.

However, Jordans argue that a hearing is required under Rule 56, M.R.Civ.P. We stated in Cole that “under Rule 56(c), a hearing is contemplated from which the district court will consider not so much legal arguments, but rather whether there exists genuine issues of material fact.” We went on to say that “a district court may not, by rule or otherwise, preclude a party from requesting oral argument, nor deny such a request when made by a party opposing the motion unless the motion for summary judgment is denied.” Cole at 418, 771 P.2d at 101.

After the granting of the order of summary judgment the Jordans retained a different attorney. The new attorney filed several motions with the District Court and requested a hearing. A hearing was held before the District Court on November 1,1991 on Jordans’ motion for a new trial or in the alternative to alter or amend judgment and motion to stay proceedings.

Dining the hearing, the court stated that the Jordans did not raise any factual matters relevant to the issuance of the summary judgment, and Jordans admitted in their brief in support of such motions there was no fact questions of whether or not Jordans were in default on the terms of their note and mortgage. Questions of fact raised by Jordans in the hearing only related to post judgment proceedings or amendments to the judgment, such as the use of the property, rights to rents and profits from the property, government payments, and valuation of the property for deficiency purposes. Thus, the court believed that a hearing on raising genuine issues of material fact relative to the motion for summary judgment, was waived, and in its order of November 15,1991 denying such motions, reinstated the August 13,1991 order granting summary judgment.

We conclude that the District Court was correct in reinstating the order of summary judgment to Aetna. We affirm the District Court on this issue.

II

Whether the District Court erred in granting Lawrence Emmett Jordan and Helen K. Jordan occupancy of the house during the redemption period, and in granting Aetna Life Insurance Company the income from the rented mortgaged premises during the redemption period.

The District Court concluded that the purchaser at the auction would be entitled to immediate possession of the balance of the mortgaged property from and after the date of sale, but that the Jordans would be entitled to possession of the residence. During the November 1, 1991 hearing, Lawrence Edward Jordan testified that his parents, Lawrence Emmett Jordan and Helen K. Jordan, currently resided on the foreclosed property. He testified they had lived on the property for 45 years. He also testified that the ranch had been one unit since the 1930’s. Section 71-1-229, MCA, provides:

The purchaser of lands at mortgage foreclosure is not entitled to the possession thereof as against the execution debtor dining the period of redemption allowed by law while the execution debtor personally occupies the land as a home for himself and his family. It is unlawful to insert in any mortgage of real estate any provision intended to constitute a waiver by the owner of real estate personally occupying land as a home for himself and family of the provision of this section or any provision intended to give the mortgagee possession of the land or premises prior to foreclosure upon default of tax, principal, or interest payments. The intention hereof is to insure to such owner the possession of his land prior to foreclosure and during the year of redemption.

In Federal Land Bank v. Snider (1991), 247 Mont. 508, 517, 808 P.2d 475, 481, we held that the execution debtor who personally occupied the premises as a home was not required to pay rent or income to the purchaser during the redemption period. In Snider, the execution debtors held possession of some 3000 acres of land. The Bank argued that the Sniders were only entitled to possession of the portion of the property occupied as a home and the rest of the ranch should be separated out for purposes of possession. We held in Snider that when determining possession of foreclosed property during the redemption period, there is no basis for dividing lands that the execution debtor personally occupies.

Snider held that execution debtors are entitled to personally possess the entire premises and the execution debtor need not pay rent or income to the purchaser during the redemption period. Thus, the Jordans are entitled to possession and are not required to pay rent or income to Aetna for the portion of the property that is not under lease to a third party. See also Interstate Credit Production Association v. DeSaye (1991), 250 Mont. 320, 820 P.2d 1285. We affirm the District Court’s determination that Jordans would be entitled to possession of the residence.

On May 23,1990, the Jordans leased a portion of their land to Jess and Jenny Knerrs. This lease was not before the District Court. Aetna filed a motion to supplement record before the Supreme Court, attaching the Knerrs’ lease. We note that under Interstate Production Credit Association v. DeSaye (1991), 250 Mont. 320, 810 P.2d 1285, the Jordans are not entitled to income if a third party is in possession of the land. We remand to the District Court for a hearing on the Knerrs’ lease to determine the extent of Jordans’ actual possession and determination of the rights of the parties.

Ill

Whether the District Court erred in granting Aetna the CRP payments covering the mortgaged premises during the redemption period when Jordans, subsequent to the mortgage, assigned their interest to a third party.

The District Court foreclosed all of Jordans’ right, title and interest in and to “various grazing rights, government crop allotments, government subsidies or payments-in-kind compensation pertaining to the property.” Previously a portion of the Jordans’ property had been placed in CRP under contract with the federal government. The federal government was originally to make payments to the Jordans through ASCS.

The mortgage between Aetna and the Jordans grants Aetna the first security interest in CRP payments because they are government crop allotments, subsidies or payments-in-kind compensation. Under the facts as presented here, we affirm the District Court’s foreclosure of Jordan’s rights, title and interest in these payments in favor of Aetna.

For the reasons set forth above, we affirm the judgment of the District Court, and remand to the District Court for fact finding and determination of the rights of the parties as to the Knerrs’ lease.

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


author: JUSTICE GRAY

text:
    JACK E. DEWART, Plaintiff and Appellant, v. THE STATE OF MONTANA, acting through the DEPARTMENT OF JUSTICE, Defendant and Respondent.
    No. 92-019.
    Submitted on briefs July 2, 1992.
    Decided Aug. 13, 1992.
    49 St.Rep. 706.
    835 P.2d 769.
    254 Mont. 215.
    For Plaintiff and Appellant: John Bobinski, Helena.
    For Defendant and Respondent: Marc Racicot, Attorney General; Peter Funk, Assistant Attorney General; and Mike McGrath, County Attorney, Helena.
   JUSTICE GRAY

delivered the Opinion of the Court.

Jack E. DeWart appeals from an Order of the First Judicial District Court, Lewis and Clark County, dismissing his complaint for declaratory and injunctive relief. We affirm.

The issue on appeal is whether the District Court erred in concluding that § 61-5-208(2), MCA (1989), requires a one year driver’s license revocation when an individual is convicted of a blood alcohol concentration (BAC) violation within five years of a driving under the influence of alcohol (DUI) conviction.

Appellant Jack DeWart (DeWart) was convicted of the offense of DUI pursuant to § 61-8-401, MCA, on August 13, 1986. He was convicted of a BAC violation under § 61-8-406, MCA, on March 6, 1991.

Following its standard practice, the Motor Vehicle Division of the Montana Department of Justice (Department) would have revoked DeWart’s driver’s license for one year under § 61-5-208(2), MCA, upon receiving notice of the March 6, 1991, BAC conviction. Before the Department could act, DeWart initiated a declaratory judgment action seeking to have the Department’s interpretation of § 61-5-208, MCA, declared erroneous as a matter of law and to permanently enjoin the Department from revoking his driver’s license. He obtained a temporary restraining order preventing revocation by the Department. The Department agreed that the temporary restraining order would remain in effect until the court decided the issue on the merits.

The District Court dismissed appellant’s declaratory action in an order dated October 29, 1991, and DeWart appealed. The parties agreed, and the District Court ordered, that the Department be restrained from revoking DeWart’s driver’s license pending resolution of this appeal.

Did the District Court err in concluding that § 61-5-208(2), MCA (1989), requires a one year driver’s license revocation when an individual is convicted of a BAC violation within five years of a DUI conviction?

The District Court relied on this Court’s interpretation of § 61-5-208(2), MCA, in Horton v. State (1986), 221 Mont. 233, 717 P.2d 1108, in determining that a BAC violation within five years of a DUI violation mandates a one year driver’s license revocation. It rejected appellant’s argument, reasserted on appeal, that amendments to § 61-8-714, MCA, by the 1989 Montana legislature prohibit the use of DeWart’s 1991 BAC conviction as a second conviction under § 61-5-208(2), MCA (1989).

Section 61-5-208(2), MCA, a civil penalty statute, has long provided for a six month driver’s license suspension upon either a DUI or a BAC conviction and a one year revocation upon a second conviction within five years. The appellant in Horton argued, as does appellant here, that a BAC conviction within five years of a DUI conviction does not equal a second offense resulting in a one year license revocation under § 61-5-208(2), MCA (1985). We rejected that argument, stating that the statute “is plain, unambiguous and certain in providing that a BAC conviction following a DUI conviction... results in a license revocation for one year.’’Horton, 221 Mont. at 236.

DeWart argues that Chapter 476, Laws 1989, introduced as House Bill 425, which made no change in the statutory language at issue, so altered related criminal penalty provisions as to necessitate an interpretation of § 61-5-208, MCA, different from that made by this Court in Horton in 1986. The 1989 amendments to § 61-8-714, MCA, the criminal penalty statute for DUI violations, added a new subsection (6) providing that “[f]or the purpose of calculating subsequent convictions under this section, a conviction for a violation of 61-8-406 [BAC violation] also constitutes a conviction for a violation of 61-8-401 [DUI violation].” DeWart asserts that this amendment, together with the absence of a corresponding amendment to the criminal penalty statute for BAC convictions and sketchy language from the legislative history, mandates a new interpretation of the civil penalty statute related to, but separate from, the criminal penalty statutes for DUI and BAC violations. DeWart’s argument misses the mark.

The plain and clear language of § 61-8-714(6), MCA (1989), limits its application to determining DUI penalties provided for in that section. The legislature had a clear opportunity to amend § 61-5-208, MCA, to comport with the interpretation urged by appellant and chose not to do so. Indeed, the legislature has amended § 61-5-208, MCA, on numerous occasions since our decision in Horton and has never amended the language at issue here. Our role is to ascertain and declare what is contained in a statute, “not to insert what has been omitted.” Section 1-2-101, MCA.

We conclude that the amendments contained in Chapter 476, Laws 1989, do not change or impact the language we interpreted in Horton or oux Horton decision. Therefore, we hold that the District Court did not err in concluding that § 61-5-208(2), MCA (1989), requires a one year license revocation when an individual in convicted of a BAC offense within five years of a DUI offense.

Affirmed.

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


text:
    AMERICAN STATES INSURANCE COMPANY, Plaintiff and Respondent, v. SUSAN WILLOUGHBY, MARK T. NIELSEN and JOHN GEERING, Defendants and Appellants.
    No. 92-022.
    Submitted on briefs June 11, 1992.
    Decided Aug. 13, 1992.
    49 St.Rep. 708.
    836 P.2d 37.
    254 Mont. 218.

      For Defendants and Appellants: James P. Healow, Sweeney & Healow, Billings.
    For Plaintiff and Respondent: Guy W. Rogers, Anderson, Brown, Gerbase, Cebull, Fulton, Harman & Ross, Billings.
   JUSTICE McDONOUGH

delivered the Opinion of the Court.

Defendants appeal from the decision of the Thirteenth Judicial District, Yellowstone County, granting Plaintiff’s motion for summary judgment and denying Defendant’s motion for summary judgment. Plaintiff, American States, had requested a declaratory judgment stating that it did not have to indemnify or defend Defendant, Mark Neilsen, in two civil actions because the acts committed by Neilsen were not covered under his American States insurance policy. We affirm the District Court.

There are two issues on appeal:

I. Did the District Court err in granting summary judgment to Plaintiff because it ruled that Neilsen’s actions were not covered under his American States policy?

II. Did the District Court err in concluding that Neilsen had the burden of proving the reasonableness of the settlements with Willoughby and Geering?

Mark Neilsen attended the automobile races at Yellowstone Belaro Speedway with his wife and friends. Sometime during the evening, security guards received a complaint about Neilsen’s behavior. Shortly thereafter, two security guards, Susan Willoughby and John Geering, entered the area where Mark Neilsen and his party were sitting. Susan and John observed Mark Neilsen being disruptive and approached him to request that he quiet down but he refused to change his behavior.

A physical altercation followed between Neilsen and Willoughby when Neilsen pushed or fell on Willoughby and they both fell to the ground. John Geering approached the two on the ground and attempted to assist Susan. Eventually, Mark Neilsen’s wife, Joe Gonzales, the security guard supervisor, and a friend of Mark’s joined the melee. Ultimately, Mark was restrained and taken under the grandstand where he created another disturbance, tussling with Deputy Sheriff Ellis and damaging a police vehicle before he was subdued and placed inside the vehicle.

Susan Willoughby and John Geering sustained injuries during the altercation and both went to the hospital following the incident. Willoughby complained of a sore back, sore leg, and swelling and a cut on her leg while John Geering was treated for three bites from Neilsen sustained during the scuffle. Neither party required hospitalization although Ms. Willoughby obtained a prescription.

Criminal charges against Mark Neilsen followed the incident. Mr. Neilsen was charged with three counts of misdemeanor assault against Susan Willoughby, John Geering and Deputy Sheriff Ellis. Mr. Neilsen pled guilty to these charges as well as to one count of criminal mischief for damage to the police vehicle.

Susan Willoughby and John Geering filed actions against Mark Neilsen for damages incurred during the incident at the Speedway and Neilsen sought indemnification from his insurance company. Neilsen’s insurance policy with American States provided that it would:

pay up to our limit of liability for the damages ... and provide a defense at our expense ... if... a suit is brought against an insured for damages because of personal injury ... caused by an occurrence to which this coverage applies ....

The exclusion provision of the policy states that coverage does not apply to bodily injury ... which is expected or intended by the insured. In addition, this provision states that the exclusion “does not apply to an act committed by or at the direction of the insured not intended to cause serious bodily injury .... (Emphasis original.)

The word “occurrence” in the policy means an accident, including exposure to conditions, which results, during the policy period, in ... personal injury. “[PJersonal injury” means bodily injury ....

A procedural history of two underlying cases will clarify the present case. On May 9, 1989, Defendant Susan Willoughby filed an action against Mark Neilsen for personal damages for assault and battery. The complaint was later amended to include a count of negligence. Neilsen tendered the defense of this action to American States requesting that it provide a defense and indemnification of any damages awarded in the Willoughby action. American States offered to provide a defense for Mr. Neilsen under a reservation of rights.

Subsequent to this arrangement, Neilsen entered into a settlement with Susan Willoughby for $25,500 without the knowledge or consent of American States. Neilsen assigned his rights under the policy to Susan Willoughby in satisfaction of the settlement agreement.

John Geering filed his action against Mark Neilsen on May 29, 1991. Virtually the same sequence of events followed in this action and ultimately, Neilsen entered into a similar settlement agreement with Geering, assigning his rights under his insurance policy without American State’s knowledge or consent.

American States filed the present action for a declaratory judgment that it did not have to indemnify or defend Neilsen in either of these actions. The District Court granted summary judgment to American States.

Summary judgment is only proper under Rule 56(c), M.R.Civ.R, where the record discloses that no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. New Hampshire Ins. Group v. Strecker, (1990), 244 Mont. 478, 480, 798 P.2d 130, 131.

I.

Did the District Court err in granting summary judgment to Plaintiff because it ruled that Neilsen’s actions were not covered under his American States policy?

American States contended that Neilsen’s actions were intentional acts and thus excluded from coverage under his insurance policy. If the company was liable for his actions, then American States argued that the settlement agreements were unreasonably high and that Neilsen had the burden to prove they were reasonable.

However, the Defendants contended that Neilsen’s actions resulted in unintended injuries and were therefore accidental. They argued that accidental injuries fell within the coverage of the insurance policy and the exclusion provision in the policy was not applicable.

The District Court concluded in its opinion that “Neilsen’s actions against Willoughby and Geering were deliberate .... Thus, Nielsen’s American States Insurance policy does not cover the acts he committed against Willoughby and Geering.” Judge Speare also stated that whether Neilsen intended to seriously injure Willoughby and Geering was a question of fact to be decided by a jury. However, since he found that the insurance policy did not cover Neilsen’s actions against Willoughby and Geering, there was no need to bring this issue to the jury. Finally, he concluded that Neilsen had the burden of proof to show that the settlements with Willoughby and Geering were reasonable.

The court reviewed deposition testimony from Willoughby, Geering, and witnesses Sheryl Wetsch and Michelle McKinney, that Neilsen refused to cooperate with the security guards and entangled several people in a physical altercation. These witnesses reported his kicking, hitting and biting people who were attempting to restrain him, including Willoughby and Geering. Evidence that Mr. Neilsen pled guilty to three counts of misdemeanor assault gave additional support to the District Court’s conclusion that Neilsen’s acts were intentional and not accidental. Strecker at 480-481, 798 P.2d at 131.

Actions such as biting, kicking and hitting are similar to those involved in Mutual Service Cas. Ins. Co. v. McGehee, (1985), 219 Mont. 304, 711 P.2d 826, wherein Mr. McGehee struck a coworker in the face twice and the victim sought damages for his injury. Mr. McGehee attempted to have Mutual Service indemnify him under his insurance policy but the company said his actions precluded recovery and they brought suit for a declaratory judgment of the parties’ rights. The comb granted Mutual Services’s motion for summary judgment stating that the company would not have to indemnify McGehee.

On appeal, Mr. McGehee contended that the court could not grant summary judgment to the insurer because there was a factual question regarding whether he intended the specific injuries sustained by the victim. In denying insurance coverage in that instance, the Court stated:

[T]he act of striking another in the face is one which we recognize as an act so certain to cause a particular kind of harm that we can say a person who performed the act intended the resulting harm, and his statement to the contrary does nothing to refute that rule of law. (Citations omitted.)

McGehee at 307, 711 P.2d at 828. See also, Transamerica Ins. Group v. Meere, (Ariz. 1984), 694 P.2d 181.

The course of conduct pursued by Mr. Neilsen included acts such as hitting, biting and kicking directed toward those who were trying to restrain him. We agree that such acts are similar to the blows struck by Mr. McGehee and are certain to cause harm of some kind, and can cause serious injury. These types of action are per se intentional and the intent to seriously injure is evident from the commission and type or nature of the act itself.

Such actions cannot be the basis for policy coverage without vitiating the purpose of insurance. “[I]f a single insured is allowed through intentional or reckless acts to consciously control risks covered by policy, the central concept of insurance is violated.” (Emphasis original.) TransAmerica at 186. The exclusion clause, excluding acts which are not “accidental” developed to ensure that in standard insurance policies, insurance companies would pay damages for “accidents” only.

We determined the applicability of this exclusion clause under general liability insurance policies by using a two-pronged test in Strecker. Strecker at 481, 798 P.2d at 132. If either prong of this test is satisfied, the acts at issue fall within the exclusion provision and are not covered under the policy. “The first prong is satisfied if the injury was not caused by an accident. The second prong is satisfied if the injury was either expected or intended from the standpoint of the insured.” Emphasis original. Strecker at 481, 798 P.2d at 132.

In Strecker, a father attempted to invoke his insurance policy’s coverage when his daughter filed a civil action against him because he had sexually molested her for 10 years. We concluded that such conduct was intentional and the intent to injure was present regardless of protestations to the contrary. The exclusion clause applied and coverage was precluded.

If we apply the Strecker test to our conclusion that Neilsen’s acts were intentional and evince an intent to injure by their very nature, both prongs of the test are satisfied. Therefore, the exclusion clause applies and coverage is precluded under Neilsen’s American States insurance policy. Summary judgment was properly granted.

II.

Did the District Court err in concluding that Neilsen had the burden of proving the reasonableness of the settlements with Willoughby and Geering?

By reason of our above coverage decision, this issue is moot.

AFFIRMED.

JUSTICES HARRISON, HUNT, TRIEWEILER and WEBER concur.