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    STATE OF MONTANA, Plaintiff and Respondent, v. BERNARD PEASE, JR., Defendant and Appellant.
    No. 84-540.
    Submitted May 31, 1986.
    Decided Aug. 8, 1986.
    Rehearing Denied Sept. 23, 1986.
    724 P.2d 153.

      Gary E. Wilcox argued, Billings, for defendant and appellant.
    Mike Greely, Atty. Gen., Helena, Patricia J. Schaeffer argued, Asst. Atty. Gen., Harold F. Hanser, Co. Atty., Charles A. Bradley, Deputy Co. Atty., Billings, for plaintiff and respondent.
   MR. JUSTICE GULBRANDSON

delivered the Opinion of the Court.

The defendant, Bernard Pease, Jr., appeals from the judgment and jury verdict finding him guilty of deliberate homicide and the denial of his motion for a new trial in the Yellowstone County District Court. He raises five issues on appeal: (1) Whether admitting a prior inconsistent statement of one person through the testimony of a second person was error; (2) whether probable cause existed to issue a search warrant for the residence and vehicles of the defendant and his family; (3) whether certain items of evidence and testimony were inadmissible character evidence; (4) whether the District Court erroneously replaced a juror during trial who had admitted to and would be charged with a felony; and (5) whether the State’s closing argument violated the defendant’s rights to due process and a fair trial. We affirm the jury verdict and judgment thereon and the denial of defendant’s motion for a new trial.

At 7:30 a.m. on Thursday, December 1, 1983, Jeffrey Miller discovered the victim’s body on his way to work. It was lying in the snow near two garbage dumpsters in an alley between North 12th and North 13th Streets in Billings, Montana. Mr. Miller asked his employer to call the police and officers and detectives arrived within ten minutes.

The young Indian woman’s body was nude, frozen and almost completely exsanguinated. The officers found very little blood at the scene. The victim had been stabbed repeatedly in the chest and her throat was cut. The slipped skin on her ankles and drag marks in the snow suggested the body had been dragged by the legs to the location near the dumpsters. There were footprints near the body and many tire tracks in the alley. There was a strand of orange yarn in the victim’s hair. Frozen ridges on her abdomen, which appeared to be from some kind of wrinkled material, disappeared as the body thawed. Her left foot appeared to be further decomposed than the rest of the body. The detectives later made a plaster cast of the decomposed foot to preserve the pattern of ridges and dents on the foot. According to the pathologist, Dr. Mueller, the victim had been dead from five to ten days when she was found, with the middle time most probable. This suggested a time of death in the early morning of November 24, 1983. During an autopsy, Dr. Mueller collected blood samples, head and pubic hairs, and fingernail scrapings from the victim.

The police identified the victim as Marie LaFromboise/Philbrick, a 23 year old woman who sometimes worked as a prostitute in Billings. She lived with two roommates, John Salas and Brenda Cunningham. Both last saw her Thanksgiving morning, November 24, 1983. Salas saw her walking in downtown Billings around 3:00 a.m. and Cunningham saw her about 3:30 a.m. talking to a man in a yellow pickup. The defendant drove a yellow and white pickup.

On one side of the alley where the body was found was a large quonset hut style building. The defendant worked at the Fireplace Store, owned and operated by the Pease family, which was in that building. An elderly man named Jim Andrews lived in a house trailer near the Pease business, about 50 yards from the dumpsters. About 3:30 or 4:00 a.m., the morning the body was found, his dog began barking. As he opened his door to let the dog out, he heard the lids clanging over the dumpsters. When he shouted in the direction of the dumpsters, the clanging stopped.

On January 5, 1984, the owner of an automotive electrical shop, located about two blocks away from the Pease business, found a sleeping bag and some jute carpet backing behind a fence alongside his building. He saw that the sleeping bag had “a lot of blood on it” so he called the police. When the officers arrived, they collected the sleeping bag and carpet backing and found orange carpet fibers similar to those in the victim’s hair. They also found bottles, pieces of brick, and a plum bob and observed holes in the sleeping bag.

Later that afternoon, the officers went to the nearby Pease masonry business seeking information about the pieces of brick. They found similar brick in the office and in the outside yard. The next day, they returned and received signed permission from Bernard Pease, Sr., the defendant’s father, to search the premises for evidence in the homicide.

The search soon revealed orange shag carpet similar to the strands found in the victim’s hair and a large piece of jute carpet backing with a section cut out. This piece matched that found with the bloody sleeping bag in fiber, weave, size and type of cut. When the officers searched the wash bay area in the rear of the Pease business, they found white cardboard boxes with blood on them, blood on the floor, a bloody paper napkin stuck to part of a box, hair, a pornographic magazine depicting violence toward women, more orange carpet strands, a large piece of orange carpet, and used and unused condoms. The defendant was one of only four people who had access to this part of the building; the others were his parents and an uncle. Along one wall near the floor in the wash bay area there were several heat pipes which had the dust rubbed off in small areas. The cleaned areas matched the bumps and lines in the victim’s left foot. According to the pathologist, hot, dry heat could have caused the foot to dehydrate and decompose faster than the rest of the body.

When the police captain realized the wash bay was the crime site, he decided to take statements from the Pease family. The defendant walked out so the captain followed him and asked him to come back.

On the basis of the evidence found during this search, the officers obtained search warrants for the Pease residence in Billings, for a trailer they owned in Fort Smith, Montana, and for another search of the business. In the defendant’s room at the residence the police found used and unused condoms like those found at the scene of the homicide, pornographic magazines featuring female bondage and women’s panties saturated with multiple semen deposits. The yellow pickup belonging to the Pease business and generally driven by the defendant had in it a flowered yellow sheet stained with what appeared to be blood. In the car registered to the defendant, the police found a payroll stub made out to defendant dated the night the victim disappeared and a condom like those found in his room and at the scene of the homicide.

The defendant was arrested February 1, 1984, and charged with deliberate homicide on February 9,1984. The trial began on July 16, 1984. During trial, an expert on blood and body fluids testified that the blood on the jute carpet backing, the sleeping bag, the Kleenex and cardboard boxes from the wash bay, the sheet from defendant’s pickup, the wash bay floor and a condom found at the wash bay was the same type as that of the victim. He also stated that no more than 84 to 120 people in the Billings area, with a population of about 120,000, would have this type of blood. This expert further testified that the semen from the women’s panties found in defendant’s bedroom, and from the used condoms found in the wash bay, including the one with blood on it, matched that of defendant.

The director of the State Crime Lab testified about the comparison of human hair made in this case. He explained that defendant’s hair had a unique pigmentation not present in the hair of other people connected with the case and an uncommon medulla. He identified head and pubic hair found in the wash bay area, on the bloody sheet in the yellow pickup, by the dumpster where the victim’s body was found, in a mat of blood on the victim’s hand, and under one of her fingernails, as matching the characteristics of defendant’s hair. According to this expert, hair characteristic of the victim’s hair was found in the wash bay, on the sleeping bag, on the sheet in the defendant’s pickup and on a condom from the defendant’s house. This same expert testified that the orange carpet fiber in the victim’s hair was very similar to that found at the Pease business.

The defendant’s hair expert concluded many of these hairs were not matched. However, he admitted most of his slides showing the hair were made at a magnification too low to show variations in pigment. Others were so high that the full hair was not in focus, had too much light which lessened the detail shown, or were out of focus.

The defendant’s ex-wife identified the sleeping bag as the “trundle bundle” which was a wedding gift to herself and defendant. She testified that he kept it when they were divorced and that they had used it frequently during their marriage. On January 6, 1984, when the defendant was asked to identify the trundle bundle in a photograph, he claimed not to recognize it.

The defense relied on supposed sightings of the victim after November 24, 1983, and defendant’s alibi for the suspected time of the killing. These alleged sightings were brief contacts with individuals who were strangers to the victim and most were from a distance. Her roommates, who saw her on a daily basis before her death, did not see her after the early morning on November 24, 1983.

Although the defense also relied on alibi, the defendant’s whereabouts were unaccounted for during the late night and early morning hours of November 23 and 24, 1983. Defendant’s bowling teammate testified that defendant bowled with the team on November 23, 1983, that bowling finished about midnight, and that he, the teammate, went home about 2:00 a.m. Defendant’s father testified that defendant went out the night of the 23rd and he did not see defendant again until after 9:00 a.m. on Thanksgiving morning, although he saw defendant’s truck at home about 6:00 a.m. that day. Friends and family did not begin to arrive for Thanksgiving dinner until after 11:00 a.m., on the 24th. Defendant was home at that time.

The jury found defendant guilty of deliberate homicide on August 1, 1984. After the verdict, defendant requested a new trial. The District Court denied this motion and sentenced defendant to 100 years on September 21,1984. He was designated a dangerous offender and received an additional 10 years for use of the weapon involved in the homicide.

Defendant appeals the judgment entered against him raising five issues:

1) Whether admitting the prior inconsistent statement of one person through the testimony of another was error.

2) Whether probable cause existed for a search warrant issued on January 24, 1984, for the residence and vehicles of Pease and his family.

3) Whether certain items of evidence seized during searches of the Pease business and testimony about defendant’s alleged involvement with prostitutes was inadmissible character evidence.

4) Whether the District Court erred when, during trial, it replaced a juror after finding out the juror was about to be arrested for sexual intercourse without consent.

5) Whether the prosecutor’s closing argument denied Pease his rights to a fair trial and due process.

In the first issue the defendant contends the District Court erred in admitting the testimony of Lou Sullivan concerning extrajudicial statements made by Brian Emineth. Emineth testified first stating that he was at Lou Sullivan’s house when he heard a television report on this homicide investigation. He denied saying anything about being with Pease and picking up, raping and murdering the victim. He admitted knowing Pease for about 17 years and having been at the business a few times. He first said he had never been in the wash bay area but later said he had been there once. On cross-examination he admitted that he thought he would be arrested for the deliberate homicide.

Lou Sullivan testified after Emineth. She said Emineth told her that the police were looking for him and Pease in connection with the homicide, that the two of them had picked up the victim and taken her to the Pease business, that Pease stabbed the victim, and that Emineth had tried to stop him but could not and fled the scene. She admitted that she was drinking when Emineth made the statements and that Emineth was drunk at the time. She also said he told her the body was at Alkali Creek and the news reports were false.

Hair characteristic of Emineth’s was found at the murder scene, on victim’s body, and in Pease’s pickup. He stated that the State Lab was lying about the hair at the scene and that the hair had been “planted.” He denied being at the murder scene or in Pease’s pickup.

The defendant offers two rationales supporting his assertion that to admit Sullivan’s testimony was error. The first is that the statements were not admissible under any of the Montana Rules of Evidence and the second is that their admission denied him his right to confrontation of witnesses.

Under the first rationale, the defendant argues that the State knew Emineth would deny making the statements when it called him to testify and deliberately “set up” the impeachment. The State justifies admitting Sullivan’s testimony as impeachment of Emineth through showing his prior inconsistent statements under the Montana Rules of Evidence. According to these rules, a party can impeach his own witness by showing prior inconsistent statements without regard to the former requirement of surprise. State v. Fitzpatrick (1980), 186 Mont. 187, 197, 606 P.2d 1343, 1349, cert. den., 449 U.S. 891, citing Montana’s Code Commission Comment to Rule 607, M.R.Evid. Rule 613, M.R.Evid. requires that the witness to be impeached be given an opportunity to explain or deny the statements prior to the admission of extrinsic evidence showing the inconsistent statements. Emineth had this opportunity and denied making the statements. Contrary to the defendant’s suggestion, the State most certainly would have preferred Emineth admit to having seen the defendant murder the victim rather than deny making the statements.

Sullivan’s testimony was admitted next, with Emineth’s denial laying the foundation for the introduction of his prior inconsistent statements. The defendant argues that her testimony was so inherently unreliable that it should have been inadmissible as hearsay. Rule 801(d)(1), M.R.Evid., provides in pertinent part:

“A statement is not hearsay if: (1) The declarant testifies at the trial or hearing and is subject to cross-examination concerning the statement, and the statement is (A) inconsistent with his testimony

The federal rule from which this was derived requires that the prior inconsistent statement be one “given under oath subject to the penalty of perjury at a trial or hearing, or other proceeding, or in a deposition.” Rule 801(d), Federal rules of Evidence. The Montana rule deleted this oath requirement as harmful and unnecessary. Emineth was present at trial and subject to direct and cross-examination. The jury could observe his demeanor as he testified. They could discern the truth or falsity of the prior statement as well as the truth or falsity of the inconsistent testimony. See Advisory Committee Comments to proposed federal rules, 56 F.R.D. 183, 296. Applying Rule 801(d)(1)(A), M.R.Evid., Sullivan’s testimony was properly admitted as the reliability of both her and the declarant could be evaluated by the jury.

This Court considered and rejected a defendant’s argument made under similar circumstances in Fitzpatrick, 186 Mont. 187, 606 P.2d 1343. In that case, the declarant testified and denied making statements about the defendant’s actions while committing the crime. Another witness then testified about the declarant’s inconsistent out-of-court statement. This Court held the evidence was admissible, relying on Rules 801(d)(l(A) and 801(d)(2)(E), M.R.Evid. The argument that the State intentionally called the declarant knowing it would impeach him without having been surprised was considered irrelevant under Montana’s evidentiary rules. Here, as in Fitzpatrick, the State’s intention was irrelevant and the prior inconsistent statements were properly admissible under the rules of evidence and could be considered as substantive evidence by the jury.

The defendant’s second rationale to support his argument in this issue is that admitting this testimony denied him his right to confront witnesses as guaranteed by the Sixth Amendment to the U.S. Constitution. This Court considered and rejected this argument in Fitzpatrick, 186 Mont. 187, 606 P.2d 1343, relying on two United States Supreme Court decisions, California v. Green (1970), 399 U.S.149, 90 S.Ct. 1930, 26 L.Ed.2d 489, and Nelson v. O’Neil (1971), 402 U.S. 622, 91 S.Ct. 1723, 29 L.Ed.2d 222.

The purpose of the confrontation clause was to prevent depositions or expert affidavits from being used against a defendant instead of placing the witness before the jury and subjecting him to direct and cross-examination. Green, 399 U.S. at 157, 90 S.Ct. at 1934-35, 26 L.Ed.2d at 496-97. In Green, the Supreme Court held that the confrontation clause is not violated by admitting a declarant’s out-of-court statements if the declarant is testifying as a witness and subject to full and effective cross-examination. The declarant in Green professed uncertainty or loss of memory at trial about certain facts, so previous statements at a preliminary hearing and to a police officer were admitted into evidence.

The declarant in O’Neil, 402 U.S. 622, 91 S.Ct. 1723, 29 L.Ed.2d 222, denied making the out-of-court statement implicating the defendant and then testified in defendant’s favor. The Supreme Court held that the confrontation clause is not violated when the declarant denies making an unfavorable out-of-court statement and then testifies favorably for the defendant.

Here, as in Fitzpatrick, 186 Mont. 187, 606 P.2d 1343, the declarant was called as a witness for the State and denied making an out-of-court statement unfavorable to the defendant. The declarant was subject to cross-examination. The testimony here was favorable to defendant in that he would have been in a worse position had Emineth affirmed making the prior statements. Both Emineth and Sullivan were examined and cross-examined. The defendant was able to show both were intoxicated at the time of the out-of-court statements. The jury heard that Sullivan had a possible motive of retaliation resulting from another incident. The jury observed the demeanor of both of them. Defendant’s right to confront witnesses was not violated by the admission of Sullivan’s testimony because the declarant testified as a witness and was subject to a full and effective cross-examination. We hold that the District Court properly admitted the questioned testimony.

In the second issue the defendant contends that the applications for the search warrants of the Pease residence and vehicles do not state facts sufficient to show probable cause. He argues that the applications do not establish a nexus between the items sought and the places to be searched and that the information in the applications was stale. In denying the defendant’s motion to suppress, the District Court concluded that the applications set forth sufficient detail to show a homicide had been committed and a reasonable probability that evidence relating to the offense would be at the places described. On the question of staleness, the District Court concluded that due to the nature of the items sought, the passage of time between the discovery of the body and the applications did not cause the information to become stale.

This Court applies the standard for reviewing a determination of probable cause set out in Illinois v. Gates (1983), 462 U.S. 213, 238-39, 103 S.Ct. 2317, 2332, 76 L.Ed.2d. 527, 548:

“[W]e affirm the totality of the circumstances analysis that has traditionally informed probable cause determinations. [Citations omitted.]

“The task of the issuing magistrate is simply to make a practical, common-sense decision whether, given all the circumstances set forth in the affidavit before him, including the ‘veracity’ and ‘basis of knowledge’ of persons supplying hearsay information, there is a fair probability that contraband or evidence of a crime will be found in a particular place. And the duty of the reviewing court is simply to ensure that the magistrate has a ‘substantial basis for . . . concluding’ that probable cause existed.”

See, State v. O’Neill (Mont. 1984), [208 Mont. 386,] 679 P.2d 760, 41 St.Rep. 420, and State v. Pierre (Mont. 1984), [208 Mont. 430,] 678 P.2d 650, 41 St.Rep. 445. A magistrate’s determination should be given great deference by a reviewing court, drawing every reasonable inference possible to support the determination. O’Neill, 679 P.2d at 765, 41 St.Rep. at 425.

The facts and circumstances contained within the four corners of the affidavit supporting the application for a search warrant should justify a reasonable belief that an offense has been committed and that the items sought are at the place designated in the warrant. State v. Isom (1982), 196 Mont. 330, 641 P.2d 417. A search will be upheld where “the nexus between the items to be seized and the place to be searched rested not on direct observation . . . but on the type of crime, the nature of the missing items, the extent of the suspect’s opportunity for concealment, and normal inferences as to where a criminal would be likely to hide stolen property.” United States v. Spearman (9th Cir. 1976), 532 F.2d 132, quoted in Pierre, 678 P.2d at 653, 41 St.Rep. at 449.

The victim’s death was an obvious homicide so there was no doubt an offense had been committed. When the application for a warrant was made, the investigation already had revealed evidence connecting the homicide to the Pease business. The body was found near the business. The sleeping bag and jute carpet backing were found nearby. The carpet in the victim’s hair and the backing found by the sleeping bag were similar to carpet and backing found at the business. Hair and blood matching that of the victim were found in the locked wash bay area of the business. The plaster cast of the victim’s foot matched the cleaned water pipes in the wash bay. No one had access to the premises except the defendant, his parents and one uncle during the time the building had been closed and the homicide had occurred. Other evidence in the application also supported the conclusion that the homicide occurred in the wash bay.

The items sought here included the murder weapon (a knife), the victim’s missing clothing, jewelry and shoes, a cancelled check payable to the victim or the Empire Bar, condoms like those at the murder scene, bloody rags or tissues, fingerprints, hair and fiber samples, bricks matching those found with the sleeping bag, and tires matching the prints near the body. This was the kind of evidence likely to exist but as yet undiscovered. Some items, i.e., the knife, the clothing, jewelry and shoes of the victim could have been possible mementos and were the kind likely to be found where the persons involved with the crime lived. See, e.g., United States v. Bowers (9th Cir. 1976), 534 F.2d 186, 190-92, cert. den. 429 U.S. 942, 97 S.Ct. 360, 50 L.Ed.2d 311. Other items, such as the hair, blood samples and fingerprints, would be difficult to collect or dispose of completely. Finally, a number of items, by themselves, were innocuous and likely to be present in a vehicle or residence for a more lengthy period of time after the crime. The information offered to support the application for a search warrant established a nexus between the locations to be searched and the items sought.

The defendant also contends that, in addition to it being unlikely the items were at the places to be searched, it was not probable that the items would still be present in the residence or vehicles 53 days after the discovery of the body. As the District Court noted, “staleness depends largely on the nature of the property sought” and the passage of this amount of time, alone, may not negate probable cause.

“The likelihood that the evidence sought is still in place is a function not simply of watch and calendar but of variables that do not punch the clock: the character of the crime (chance encounter in the night or regenerating conspiracy?), of the thing to be seized (perishable and easily transferable or of enduring utility to its holder?), of the place to be searched (mere criminal forum of convenience or secure operational base?), etc. The observation of a half-smoked marijuana cigarette in an ashtray at a cocktail party may well be stale the day after the cleaning lady has been in; the observation of the burial of a corpse in a cellar may well not be stale three decades later. The hare and the tortoise do not disappear at the same rate of speed.” Andresen v. State (Md.App. 1975), 331 A.2d 78, aff’d sub. nom. Andresen v. Maryland (1976), 427 U.S. 463, 96 S.Ct. 2737, 49 L.Ed.2d 627, cited in Pierre, 678 P.2d at 654, 41 St.Rep. at 449.

The items sought here were more likely to remain in a residence or vehicle than consumable or perishable goods. Some would have continuing utility to the owner. The places searched were those a person normally would store items. Many of the objects were not of the nature that they would be destroyed by the defendant. Although many items were the kind of evidence that could be moved easily, there was no reason to believe that any would be moved to different locations. Thus, information supporting the applications was not stale. Drawing all reasonable inferences to support the magistrate’s determination, we hold that there was a substantial basis for concluding probable cause existed at the time the search warrants were issued.

In the third issue the defendant claims that the District Court improperly admitted into evidence pornographic books, condoms, the woman’s panties found in defendant’s room, and testimony about his prior contacts with prostitutes. He contends that the evidence was irrelevant, the danger of unfair prejudice substantially outweighed any probative value, and that the testimony was inadmissible character evidence. We first note that photographs of the covers of the pornographic magazines and a pin-up found at the murder scene and in defendant’s room, photographs of condoms found at the murder scene and in defendant’s room, and a photograph showing stains on the woman’s panties found in defendant’s room were admitted into evidence, not the objects themselves. We address the admissibility of these photographs separately from the admissibility of testimony about defendant’s contacts with prostitutes.

The State contends that the photographs were relevant to show the identity and possible motive of the perpetrator of the crime. Rule 401, M.R.Evid., defines relevant evidence as:

“. . . evidence having any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence. Relevant evidence may include evidence bearing upon the credibility of a witness or hearsay declarant.”

This standard “is meant to allow wide admissibility of circumstantial evidence limited only by Rule 403 or other special relevancy rules in Art. IV [of M.R.Evid.].” Fitzpatrick, 186 Mont. at 207, 606 P.2d at 1354, citing Montana’s Code Commission Comment.

The photographs of the condoms, the pornographic magazines and pin-up, and the woman’s panties tend to connect the defendant with the scene of the murder and suggest a possible violent sexual motive. A pornographic pin-up suggesting violence and condoms were found at the scene. The search of defendant’s room yielded pornographic magazines suggesting violence toward women, condoms like those in the wash bay, and the semen stained woman’s panties. The victim’s clothing was never found. Although the panties were never identified as belonging to the victim, a detective testified that murderers often take and keep items belonging to the victim. On one of the used condoms in defendant’s room, pubic hair matching that of the victim was found. The semen stains and hair on the panties were defendant’s type. The hair and fiber expert testified hair adheres to fabric and can be transferred. The jury could have inferred from this evidence that the hair found on the condom came from the panties. These items all tended to link the defendant with the scene of the crime and the victim, and suggested a possible motive.

Defendant argues that even if relevant, the prejudicial effect of the items exceeded any probative value.

“Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.”

Rule 403, M.R.Evid. A district court’s weighing of potential prejudice against probative value will be upheld absent an abuse of discretion. State v. Austad (1982), 197 Mont. 70, 83, 641 P.2d 1373, 1380. The District Court below rejected defendant’s argument that the evidence was unfairly prejudicial because it reflected on his character. This Court rejected a similar argument in State v. Armstrong (1976), 170 Mont. 256, 552 P.2d 616, where evidence of defendant’s destitute financial condition, outbursts of anger, and high regard for his weapons formed circumstantial evidence from which to infer a motive for the homicide. Here, photographs of the objects formed circumstantial evidence from which to infer the defendant was the perpetrator and to infer a motive from evidence of his interest in violent sex. In a violent sex-related homicide most evidence linking the defendant to the crime is likely to be somewhat prejudicial. Here, the State used photographs of the objects having probative value rather than the objects themselves, the latter of which may have had greater potential for prejudice. We find that the District Court did not abuse its discretion by allowing these photographs into evidence.

A detective testified that the defendant gave a statement in which he denied ever dealing with prostitutes. A later witness testified that the defendant had paid for the services of two prostitutes for himself and the defendant. Another witness testified that the defendant told her he would “get a hooker” after she refused to go home with him. The defendant argues, as part of this third issue, that this testimony was inadmissible under Rule 404(b), M.R.Evid., and that the danger of unfair prejudice outweighed any probative value of the testimony.

Rule 404(b), M.R.Evid., states:

“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 therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident.” (Emphasis added.)

In State v. Shaw (1982), 199 Mont. 248, 252, 648 P.2d 287, 289-90, this Court held that “other crimes” evidence under this Rule may be admitted to show consciousness of guilt. The testimony was offered to show that the defendant gave a false statement about his contacts with prostitutes during questioning about the homicide of a prostitute rather than to prove his character. A false explanation of incriminating information may be considered evidence of consciousness of guilt. United States v. Green (9th Cir. 1979), 597 F.2d 1227, cert. den., 444 U.S. 853, 100 S.Ct. 108, 62 L.Ed.2d 70. As noted above, absent an abuse of discretion, this Court will not overturn a district court’s weighing of the danger of prejudice against probative value. Austad, 197 Mont. at 83, 641 P.2d at 1380. The testimony made the issue of the defendant’s identity more likely by allowing an inference of his consciousness of guilt. We find no abuse of discretion in admitting this evidence.

The fourth issue concerns whether the District Court erred when it replaced a juror during trial, after finding out the juror was to be arrested for the felony offense of sexual intercourse without consent. The State brought the matter to the District Court’s attention at an in camera hearing after it became aware of the pending investigation. The officer who was investigating the juror testified that the juror confessed to the crime, knew he would be arrested and had expressed concern that the timing of the arrest would affect his duties as a juror. The State moved to disqualify the juror for the reasons that he may be overly sympathetic to the defendant or he may vote for a conviction to gain leniency from the State. The defendant’s counsel agreed that both possibilities were relevant concerns but argued that the alternate was not paying attention. He did not object to the juror’s removal. The District Court then disqualified the juror and questioned him regarding whether the other jurors were aware of his situation. He testified that they were not. The District Court denied the defendant’s subsequent motion for mistrial based on contamination of the jury panel and on the alternate’s lack of attention. The defendant raised the juror’s disqualifications as an issue in his motion for a new trial, arguing that the District Court did not have the authority to remove the juror after the presentation of evidence began and that there was an insufficient showing of possible bias on the part of the juror. When denying the motion for a new trial, the District Court stated the defendant no longer claimed prejudice from the alternate’s participation and the defendant had agreed there was a potential for prejudice if the juror remained on the panel. The District Court held the possibility of the juror’s being charged was sufficient to prevent his impartiality in deliberations.

Contrary to the defendant’s contention, the removal of this juror was not premised on Section 46-16-306, MCA. The District Court considered Section 46-16-306 and -304(2), MCA, on challenges for cause as an aid in determining whether the possibility of the juror being charged was sufficient to replace him. The juror was replaced pursuant to Section 46-16-307(3), MCA, which states:

“Alternate jurors, in the order in which they are called, shall replace jurors who, prior to the time the jury arrives at its verdict, become unable or disqualified to perform their duties . . .”

The plain meaning of the statute is that substitution of an alternate for an original juror who becomes disqualified or unable to perform his duties is permitted at any time prior to the reaching of a verdict. Clearly, the defendant’s argument that the District Court’s action was not timely must fail.

Rule 24(c) of the Federal Rules of Criminal Procedure contains language similar to Section 46-16-307(3), MCA. The federal circuits consistently hold that the trial court has the discretion to remove a juror and seat an alternate whenever the facts show the juror’s ability to perform his duties is impaired. The circuits also consistently hold that the reviewing court will not disturb the ruling unless the defendant shows bias or prejudice. U.S. v. Ellenbogen (2nd Cir. 1966), 365 F.2d 892, 989, cert. den., 386 U.S. 923, 87 S.Ct. 892, 17 L.Ed.2d 795. See also, U.S. v. Zambito (4th Cir. 1963), 315 F.2d 266, 269, cert. den., 373 U.S. 924, 83 S.Ct. 1524, 10 L.Ed.2d 423; U.S. v. Smith (5th Cir. 1977), 550 F.2d 277, cert. den., sub. nom. Wallace v. U.S. (1977), 434 U.S. 841, 98 S.Ct. 138, 54 L.Ed.2d 105; U.S. v. Barrett (9th Cir. 1983), 703 F.2d 1076, 1083, n. 12. “ ‘[Prejudice’ would include discharge of a juror for want of any factual support, or for a legally irrelevant reason. There must be some ‘sound’ basis upon which the trial judge exercised his discretion.” U.S. v. Rodriguez (5th Cir. 1978), 573 F.2d 330, 332.

The District Court had a legal reason and heard facts from which it could determine the juror’s ability to perform his duties would be impaired. Section 46-16-304(2)(j), MCA, provides that a challenge for cause may be taken if the juror has a “state of mind in reference. . .to either of the parties which would prevent him from acting with entire impartiality and without prejudice to the substantial rights of either party.” An officer who had been or would be present during trial testified that the juror knew he was to be arrested for a sex related offense by that same officer. The defendant’s counsel agreed that concerns about the juror voting either to curry favor with the State or in sympathy for the defendant were legitimate concerns. The District Court did not abuse its discretion.

The better procedure would have been to question the juror prior to replacing him with an alternate. However, in this case such a hearing would have had limited utility. The juror had a right to remain silent about the pending charges and any insistence on his part that he could remain impartial may have had little weight. The District Court already had sufficient information to remove the juror.

The defendant apparently held the view that the jury panel would be contaminated if the juror remained. The District Court questioned the juror and determined that he had not discussed his situation with the others, including the alternate. After this, the defendant still objected only on the grounds of contamination of the jury panel. He did not object to the removal of the juror. If the District Court had let the juror remain, the defendant would be arguing that was error. We hold that the District Judge acted within her discretion when replacing the juror with the alternate. The defendant has failed to demonstrate any prejudice from the action and any procedural error was harmless.

Nor did the defendant demonstrate prejudice from the calling of the alternate juror. The alternate was subjected to voir dire and accepted by the defendant. The defendant alleged improper conduct by the alternate only in his motions for a mistrial and a new trial. The record shows no objection during trial and no request to admonish the alternate for a failure to pay attention. The District Court did not note any inappropriate behavior by the alternate.

In the final issue, the defendant argues that the State’s closing argument denied him due process and a fair trial. Montana has long held that objections to closing arguments first made on appeal are too late. Hawkins v. Crist (1978), 178 Mont. 206, 583 P.2d 396, cert. den., 439 U.S. 957, 99 S.Ct. 359, 58 L.Ed.2d 350. The defendant admits he chose not to object as a matter of trial strategy. Contrary to his contentions, State v. Harris (Mont. 1984), [209 Mont. 511,] 682 P.2d 159, 41 St.Rep. 866, does not hold that a motion for a new trial preserves an objection to a closing argument. Harris relies on the plain error doctrine in Section 46-20-702, MCA. This case does not meet the conditions set forth in that statute.

Further, the prosecutor’s statements during closing argument were based on the evidence admitted at trial. There was no comment on the defendant’s failure to testify or on facts not in evidence. The District Court, when presented with the motion for new trial, correctly ruled the failure to object barred consideration of this issue because substantial rights of defendant were not affected and correctly noted the comments did not exceed the bounds of permissible argument.

The jury verdict, subsequent judgment and the order denying defendant’s motion for a new trial are affirmed.

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


source: Caselaw Access Project

author: MR. JUSTICE GULBRANDSON

license: Public Domain

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. RONALD LEAVENS, Defendant and Appellant.
    No. 85-231.
    Submitted on Briefs May 15, 1986.
    Decided Aug. 8, 1986.
    723 P.2d 236.

      E. June Lord, Great Falls, for defendant and appellant.
    Mike Greely, Atty. Gen., Patricia J. Schaeffer, Asst. Atty. Gen., Helena, Patrick L. Paul, Co. Atty., Great Falls, for plaintiff and respondent.
   MR. JUSTICE GULBRANDSON

delivered the Opinion of the Court.

The defendant appeals his conviction for felony burglary, misdemeanor attempted theft, and misdemeanor criminal mischief, in the Cascade County District Court. His only claim on appeal is that he was denied effective assistance of counsel. We affirm the conviction.

On July 14, 1984, at about 5 a.m., a police officer on patrol heard glass breaking. As he drove toward the sound, the defendant and his companion, Lyle Gardipee, saw the officer and ran. The officer saw that the window at Bernadette’s Restaurant was broken and pursued, caught and arrested the two men for breaking the window. At the time of his arrest, the defendant’s clothing was dirty, his hair was covered with gray colored dust and he had a recent cut on his arm. Gardipee also had a gash and some dust on his clothes. These charges were later dismissed.

About one half hour later, another officer was called to Wood World, a furniture store, to investigate a burglary. Wood World is about one half block from where the first officer encountered the defendant and Gardipee. To enter the business, the offender(s) had broken through a walled-over window that had wire running through it and kicked through the sheetrock covering the window. The store was cluttered with chairs knocked over, there was blood on a desk chair and on a desk, and an oak file cabinet had been moved from the front to the back of the store. The offender(s) left the building by going through the window of the rear garage door.

The person who reported the burglary heard glass breaking at about 2:30 that morning. He did not call the police until 5:30 a.m., when he saw the windows had been knocked out of the rear garage door at Wood World and saw a brass duck and a ceramic boot lying in the alley.

The officers arrested the defendant and Gardipee, who were still in custody, for this break-in based on their recent cuts, the dust on their clothing which looked liked dust from sheetrock, their location near the scene of the crime, and the unusual treadmarks on defendant’s shoes which matched footprints left outside the entry point and on the window ledge at Wood World. At trial, held December 3 and 4, 1984, an expert testified that the broken sheetrock from the store had a unique composition containing crushed red brick particles. Sheetrock dust recovered from the defendant’s clothing and shoes contained these red brick particles. Another expert testified that the paint fragments attached to the sheetrock were of a unique color mixture and that the paint particles from defendant’s clothing were of the same color, texture, and composition as the paint on the store wall at the point of the break-in. Both experts agreed that the defendant’s clothing would contain that amount of debris only by coming into contact with sheetrock as it was being broken. The jury returned a verdict of guilty on all three counts charged.

On appeal, the defendant claims he was denied effective assistance of counsel as guaranteed by the Sixth Amendment to the United States Constitution and by Art. II, Section 24, of the 1972 Montana Constitution. This Court recently adopted a two-prong test for analyzing a claim of ineffective assistance of counsel. State v. Robbins (Mont. 1985), [218 Mont. 107,] 708 P.2d 227, 232, 42 St.Rep. 1440, 1444, citing Strickland v. Washington (1984), 466 U.S. 668, 104 S.Ct. 2052, 80 L.Ed.2d 674.

“First, the defendant must show that counsel’s performance was deficient. This Court has used the ‘reasonably effective assistance’ test of whether a defendant’s counsel acted within the range of competence demanded of attorneys in criminal cases. State v. Rose (1980), 187 Mont. 74, 86, 608 P.2d 1074,1081. Second, the defendant must show that the deficient performance prejudiced him so seriously as to deprive him of a fair trial.”

State v. Elliot (Mont. 1986), [222 Mont. 438,] 717 P.2d 572, 575, 43 St.Rep. 723, 726. The standard for prejudice is “that there is a reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different.” Strickland, 466 U.S. at 694, 104 S.Ct. at 2068, 80 L.Ed.2d at 698.

“It will generally be appropriate for a reviewing court to assess counsel’s overall performance throughout the case in order to determine whether the ‘identified acts of omissions’ overcome the presumption that a counsel rendered reasonable professional assistance. Since ‘[t]here are countless ways to provide effective assistance in any given case,’. . . unless consideration is given to counsel’s overall performance, before and at trial, it will be ‘all too easy for a court, examining counsel’s defense after it has proved unsuccessful, to conclude that a particular act or omission of counsel was unreasonable.’ . . . (Citations omitted.)”

Kimmelman v. Morrison,_U.S__,_, 106 S.Ct. 2574, 2589, 91 L.Ed.2d 305 (1986), citing Strickland, supra.

The defendant contends that counsel’s performance was deficient in failing to call an alibi witness, failing to investigate the defendant’s explanation of damaging evidence, failing to counter expert testimony, and failing to make a motion to suppress the clothing seized incident to an arrest he claims was unlawful. The defendant’s allegations on appeal concerning an alibi witness and how he got sheetrock dust on his clothing are not supported in the record. We will not consider these on appeal. Elliott, 717 P.2d at 575, 43 St.Rep. at 722. In addition, a decision on whether to call a witness “is a matter of trial tactics, which are normally not grounds for a determination that counsel’s performance was deficient.” Elliott, supra.

The defendant also alleges that counsel failed to investigate the uniqueness of his shoes and failed to counter expert testimony on the sheetrock. Whether a decision to not investigate such evidence is reasonable professional judgment must be assessed under the particular circumstances. Strickland, 466 U.S. at 694, 104 S.Ct. at 2068, 80 L.Ed.2d at 698. Here, counsel emphasized to the jury the officers’ failure to measure the prints and compare them to the size of defendant’s shoes. He explained the sheetrock particles on defendant’s clothes when he suggested they transferred from Gardipee to defendant during a fight and shifted responsibility for the break-in to Gardipee. There was little he could have done to attack the matching of paint and sheetrock characteristics from Wood World to his clothing. Under such circumstances, a decision to not attempt a counter of this testimony was not unreasonable.

The defendant’s final allegation is that his counsel failed to move to suppress his clothing after it was seized pursuant to the first, unlawful arrest. We do not agree that the arrest was unlawful. Section 46-6-401(l)(d), MCA, states that an officer may arrest a person without a warrant when “he believes on reasonable grounds that the person is committing an offense or that the person has committed an offense and the existing circumstances require his immediate arrest.” The officer properly arrested the defendant and his companion without a warrant under this statute when he heard the glass breaking, saw them near the scene, and they fled after noticing the officer. State v. DiGiallonardo (1972), 160 Mont. 379, 503 P.2d 43. Since the defendant’s clothing was seized incident to a lawful arrest, the seizure was proper under Section 46-5-101(1), MCA, and was admissible as evidence. Section 46-5-104, MCA, and State v. Armstrong (Mont. 1980), 616 P.2d 341, 349, 37 St.Rep. 1563, 1570. Any motion to suppress this evidence would have been futile. The defense counsel’s failure to so move does not indicate a deficient performance.

We hold that defendant has failed to carry the burden of showing his counsel’s performance was deficient or outside the range of competence demanded of attorneys in criminal cases and has failed to show prejudice resulting from the alleged deficient performance.

Affirmed.

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


author: MR. JUSTICE SHEEHY MR. JUSTICE MORRISON,

text:
    JOHN L. HOLLOW, Plaintiff, v. STATE OF MONTANA, Montana Economic Development Board, D. Patrick McKittrick, Yvonne Snider, Jeremiah R. Sullivan, G. Steven Brown, Karen R. Locke, John C. Orth, Jackson L. Schutte, as members of said Montana Economic Development Board, Montana State Department of Commerce, and Keith Colbo, Director of said Department of Commerce, Defendants.
    No. 85-447.
    Submitted March 12, 1986.
    Decided Aug. 8, 1986.
    723 P.2d 227.

      Hull & Sherlock, Jeffrey M. Sherlock argued, Helena, for plaintiff.
    Dorsey & Whitney, Mae Nan Ellingson argued, Great Falls, for defendants.
   MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

In this case we determine and hold that the provisions of Section 17-6-308, MCA, which permit the use of in-state investment fund monies (Section 17-6-306, MCA) derived from taxation to guarantee loans or bonds of private individuals or private entities either directly or through the capital reserve account (Section 17-5-1515, MCA) or through the economic development guaranty fund (Section 17-5-1520, MCA) are unconstitutional from the viewpoint of our state constitution.

I.

This is an original proceeding in this Court, brought by John L. Hollow, a citizen, resident of Helena, Montana, and taxpayer, voter and property owner in this state. His action is brought under the Uniform Declaratory Judgments Act (Section 27-8-101, MCA, et seq.) for the purpose of obtaining from this Court a declaration that certain provisions of S.B. 349, Ch. 640, Laws of Montana (1985), enacted by the 49th Legislative Assembly are invalid as offending the State Constitution. We ordered responses from counsel representing the defendants, which responses were served and filed. Thereafter, oral argument was had before the Court on March 12,1986 concerning the contentions raised by the complaint and the responses.

There is no dispute between the parties as to whether this Court has jurisdiction to proceed, but in an original proceeding, we must, of course, find jurisdiction under our granted powers. To be sure about it, the same facts and factors that excited our acceptance of original jurisdiction and caused us to find standing for the taxpayer in Grossman v. State Department of Natural Resources (Mont. 1984), [209 Mont. 427,] 682 P.2d 1319, 41 St.Rep. 804, are present in this case. Here Hollow challenges the constitutionality of various aspects of the in-state investment program; the issuance of bonds by the state under the program is delayed because underwriters or investors who would purchase bonds require a final court resolution of the constitutional issues involved; the program involves major segments of the state’s population, and has great impact upon its economy; requiring the case to proceed first to the District Court and then here on appeal for a final resolution will require a lapse of time almost intolerable; and the proceedings here are designed to obtain a final judgment on the validity of the bonds which might be issued thereunder, so if valid, the bonds would be marketable. As we stated in Grossman, the issues here are fairly stated, fully explored and vigorously contended so that we have a justiciable controversy suitable for final resolution. Therefore we assume jurisdiction.

II.

The Montana Economic Development Board was created by Section 2-15-1805, MCA; its individual members at the time of the complaint here are the defendants McKittrick, Snider, Sullivan, Brown, Locke, Orth, and Schutte. The Board is administratively attached to the Montana Department of Commerce, an administrative agency of the state which is directed by the defendant Colbo. The Board is purporting to and intends to issue bonds within the limits prescribed by S.B. 349 (the title of the legislation in the legislature; we will refer as we proceed in this discussion to pertinent parts of S.B. 349 as the said parts are now enumerated in the code sections of the Montana Codes Annotated). The Board adopted a resolution on August 8, 1985 declaring its intention to issue the total principal amount of bonds permitted under the legislation. However, the Board has been advised by its bond counsel that there are several constitutional issues raised by the legislation which have not been specifically addressed by this Court in prior decisions and that a final resolution of those issues would be required by the investors to effectuate the sale of bonds issued by the Board.

III.

A short statement of what S.B. 349 accomplished is that the legislation authorized the Board to utilize the in-state investment fund to guarantee loans or bonds otherwise authorized to be made or issued by the Board under the provisions of the Montana Economic Development Bond Act, the Municipal Finance Consolidation Act, or the Montana Health Facility Authority Act; and to make and agree to make loans from the in-state investment fund to the capital reserve account and guarantee funds which secure certain bonds issued by the Board.

While that short statement may suffice to advise the reader of the effect of the legislation, it does not begin to lead the reader through the maze of statutory provisions attending the activities of the Board. These we must explore in some detail for background to our decision here.

The legislature adopted the “Montana Economic Development Bond Act of 1983” (Section 17-5-1501, MCA et. seq.) for the purposes of promoting the general welfare of the people of the state, to increase job opportunities, and to retain existing jobs by making available funds for industrial, commercial, agricultural and other uses for economic development. The Board was given power to issue bonds and notes for “projects” and “major projects” (Section 17-5-1506, MCA) and to maintain necessary accounts (Section 17-5-1514, MCA). One of such accounts is the capital reserve account, of which more later.

The Board was also given power to engage in a project guarantee program (Section 17-5-1519, MCA) and to guarantee payments required by a loan, lease, or other credit arrangement for any project funded as authorized. Particularly with respect to its guarantee program, the Board was also empowered to create an economic development guarantee fund (Section 17-5-1520, MCA).

IV.

The capital reserve account established by the Board is provided in Section 17-5-1515, MCA. It consists of funds appropriated and made available by the state for the purposes of the account, proceeds from the sale of notes or bonds to the extent provided in the resolutions or indentures of the Board authorizing their issuance and such other funds as may be available from other sources.

Funds held in the capital reserve account must be used solely for the payment of principal of or interest on bonds secured by the account and must be maintained in a minimum amount sufficient to meet obligations of principal, interest and redemption premiums and debt service for such bonds and notes.

No bonds issued by the Board, and funded through the capital reserve account are a debt, liability or obligation of the faith and credit of the state, but are payable solely from the revenue or assets of the Board (Section 17-5-1523, MCA). Nonetheless, the governor must include in the executive budget submitted to the legislature any sums required to restore the capital reserve account to the sum of minimum capital reserve requirements (Section 17-5-1516, MCA). This latter provision is denoted the “moral obligation” clause.

V.

The Board is further empowered to establish a project guarantee program (Section 17-5-1519, MCA). The Board may make commitments to guarantee payments required by a loan, lease or other credit arrangement for any project funded under the Montana Economic Development Bond Act, or under industrial development projects as outlined in Section 90-5-101, MCA, et seq. To fund this program, the Board is authorized to create an economic guarantee fund (Section 17-5-1520, MCA). It consists of insurance fees, premiums and other revenue and assets as the Board considers necessary to comply with any contract or agreement entered into by the Board and of borrowings up to $7.5 million from any available state funds.

Funds in the Economic Development Guarantee Fund must be used to satisfy any claim resulting from a defaulted loan, lease or any other credit agreement. Once again the credit of the State is not pledged with respect to this fund but the governor is required to include in the executive budget submitted to the legislature sums required to restore the economic guarantee fund to the minimum reserve requirements, which is an amount not in excess of the aggregate annual payments due under the loans, leases, or other credit agreements guaranteed by the Board (Sections 17-5-1520(3),(4), MCA).

The projects for which the funds produced by Economic Development Bonds may be used are broadly defined. A “major project” is one whose cost or appraised value exceeds $800,000 (Section 17-5-1503(6), MCA). Otherwise a “project” means, under Section 17-5-1503(7), MCA, those projects outlined in Section 90-5-101(6), MCA, which follow:

“ ‘Project’ means any land; any building or other improvement; and any other real or personal properties deemed necessary in connection therewith, whether or not now in existence, which shall be suitable for use for commercial, manufacturing, agricultural, or industrial enterprises; recreation or tourist facilities; local, state, and federal governmental facilities; multifamily housing, hospitals, long-term care facilities, or medical facilities; small-scale hydroelectric production facilities with a capacity of 50 megawatts or less; and any combination of these projects.”

VI.

The provisions of S.B. 349 that create constitutional problems, as we view it, arise out of the use of the in-state investment fund.

The 1972 Montana Constitution, in Art. VIII, Section 13, directs that the state engage in a unified investment program. Accordingly, Section 17-6-201, MCA, directs that public funds be administered by the Board of Investments and the Montana Economic Development Board. The power of the Board of Economic Development, however, is limited to investment of the in-state investment fund (Section 17-6-201(4), MCA).

The Montana in-state investment fund is derived partly from the taxation of the severance of coal in Montana. The Montana in-state investment fund consists of (1) 25% of the revenue deposited after June 30, 1983 into the permanent coal tax trust fund established in Section 17-6-203(5), MCA; (2) the principal payments on all investments made from the Montana in-state investment fund; and, (3) 15% of the annual income and earnings on the Montana in-state investment fund appropriated to the coal severance permanent fund by Section 17-5-704(2), MCA. (Section 17-6-306, MCA.)

At this point, it is necessary to set out in full the perimeters of Section 17-6-308, MCA, respecting authorized investments of the instate investment fund. The statute follows:

“(1) The Montana in-state investment fund must be invested as authorized by rules adopted by the board. For purposes of this section, ‘investment’ includes the guaranty of loans or bonds in consideration for a fee, in lieu of the actual acquisition of such loans or bonds.

“(2) The board may use the in-state investment fund to guarantee loans or bonds issued under the provisions of 17-5-1501 through 17-5-1529, Title 17, Chapter 5, part 16, or Title 90, Chapter 7. Each guaranty must be given in consideration of a fee. The fees must be paid to the board. The guaranty must provide directly or by separate agreement that the board is fully subrogated to the rights of the obligee under the loan or bond. The board shall by rule establish the maximum ratio between guaranty funds available and loans or bonds to be guaranteed. The board may covenant in bond issues to maintain such ratio. Unless bonds issued to finance a project are secured by a common capital reserve account and a common guaranty fund, the maximum amount of the guaranty authorized by this section may not exceed $3,000,000 with respect to the bonds or loans to finance the project.

“(3) The board may make loans from the in-state investment fund to the capital reserve account created pursuant to 17-5-1515 and the guaranty fund created pursuant to 17-5-1520 to establish balances or restore deficiencies therein. The board may agree in connection with the issuance of bonds or notes secured by such account or fund to make such loans. Loans must be on such terms and conditions as the board determines and must be repaid from revenues of the board realized from the exercise of its powers under 17-5-1501 through 17-5-1529, subject to the prior pledge of the revenues to the bonds and notes.”

Under S.B. 349, the legislature in 1985 amended subdivision (1) of Section 17-6-308, MCA, to provide that an “investment” includes the guaranty of loans or bonds in consideration of a fee, in lieu of the actual acquisition of such loans or bonds. Such a provision did not exist prior to the amendment to define an investment.

The concept that undertaking to guaranty the private debt or obligation of another is an “investment,” is peculiar, to put it mildly. It is akin to co-signing a note at the bank for a friend, which as Shakespeare noted, “oft loses both itself and friend.” The defendants contend that guaranties on loans authorized under the statutes here are nothing more than additional types of investments and that the act of investing by guaranty does not create a debt on the part of the state. They rely on an informal opinion of the Montana Attorney General to that effect, and on provisions of Section 17-6-308, MCA that the guaranty must be given in consideration of a fee; that it must provide that the Board is subrogated to the rights of the obligee; that there must be a maximum ratio between guaranty funds available and loans to be guaranteed; that the maximum amount of the guaranty may not exceed $3 million in any project unless the bond is secured by a common guaranty fund and that the loans must be repaid from the revenues of the Board.

An “investment” is defined in Webster’s New Collegiate Dictionary (1981 ed.) as “the outlay of money usually for income or profit; a capital outlay.” When an investment is by guaranty, the outlay will come when the project has failed or the income is lost. A guarantor agrees to answer for the debt, default or miscarriage of another. Section 28-11-101, MCA.

The provisions of Section 17-6-308, MCA, which permits the Board to establish a maximum ratio between guaranty funds available and loans to be guarantied have prompted the Board to adopt by resolution an administrative rule, A.R.M. Section 8.97.413, which reads in pertinent part:

“(2) The total principal amount of loans guarantied under A.R.M. 8.97.410 and bonds guarantied under 17-6-308(1), MCA, and of outstanding loans and obligations to make loans to the Capital Reserve Account and Guaranty Reserve Account shall not exceed, as of the date of the guaranty, loan or obligation, eight times the Guaranty and Loan Base.

“(3) The Guaranty and Loan Base shall, at the time of determination, be an amount equal to 25% of the current market value of all assets of the board in the Investment Fund.”

Thus, the potential liability of the state is for the full amount of all guaranties made by the Board which can be as great as two times the amount of the in-state investment fund. In a worst case scenario, guaranty holders may look to the state for full satisfaction for when “the legislature validly acts to establish a debt under Art. VIII, Section 8, that indebtedness becomes a state obligation extending over the life of the indebtedness, and every succeeding legislative assembly has an unavoidable duty to provide for it, in the manner required by the authorizing law.” Grossman, 682 P.2d at 1332, 41 St.Rep. at 819-20.

The strictures which protect the credit of the state with respect to bonds issued by the Board are not present with respect to the use of the in-state investment funds under Section 17-6-308, MCA. With respect to bonds, Section 17-5-1523, MCA, provides that such obligations do not constitute a debt, liability, obligation or pledge of the faith or credit of the state. To the contrary, under Section 17-6-308, MCA, the Board may use the in-state investment fund to pay obligations of guaranty of loans or bonds. In so doing, the Board would apply that portion of the in-state investment fund that derives from 25% of the coal severance tax revenues provided in Section 17-6-306, MCA. When such funds are used to satisfy guaranties of private debts or obligations its use offends Art. VIII, Section 1 of the Montana Constitution which provides taxes shall be levied by general laws for public purposes; Art. V, Section 11(5) that no appropriation shall be made for industrial or benevolent purposes to any private individual or private corporation not under the control of the state; and Art. VIII, Section 13(1), providing for a unified investment program, insofar as Section 17-6-308, MCA allows guaranties of private obligations as permissible investments. See Veteran’s Welfare Commission v. V.F.W. and D.A.V. (1963), 141 Mont. 500, 379 P.2d 107.

In like manner, the provisions of subdivision (3) of Section 17-6-308, MCA, are constitutionally impermissible. Under that subdivision, the Board may make loans from the in-state investment funds to the capital reserve account we have described above and the economic guaranty fund also described above to establish balances or restore deficiencies therein. The loans are repayable from revenues of the Board realized from the exercise of its power and the issuance of bonds but subject to the prior pledge of the revenues to the bonds and the notes.

As we noted, under Section 17-5-1523, MCA, the credit of the state is not pledged to secure the bonds issued by the Board. Section 17-6-308(3), MCA, sidesteps that provision by providing that the Board may agree in connection with the issuance of bonds to make loans out of the in-state investment fund to the capital reserve account and the economic guaranty fund. The effect is, without the further action of the legislature, that tax monies derived from the coal severance tax will be loaned from the in-state investment fund and used to secure the obligations of the bonds. Such a procedure impermissibly offends the same provisions of the constitution we have referred to above.

This Court is aware that in Huber v. Groff (1976), 171 Mont. 442, 558 P.2d 1124, we held that the credit of the state was not pledged under the provisions of the Montana Housing Act of 1975. That act provides that the Board of Housing may issue bonds for the purchase of loans used for housing from banks and other financial institutions. We were careful to point out in Huber, however, that the act specifically said that the credit of the state was not pledged as security of the bonds so issued, even though there was a “moral commitment” much as we have at the case at bar, that the governor would request the legislature to appropriate necessary funds to supplement the reserve accounts. That avenue of redress for deficiencies, if any exist, in the capital reserve account and the economic development bond fund is still open under this decision. What we do not and cannot condone is the direct use of tax monies by legislative provision which in effect directly pledges the credit of the state to secure the bonds involved in this case.

VI.

There are a number of other issues raised by Hollow in his complaint, but what we have said foregoing is sufficient to demonstrate that the use of the in-state investment fund as provided in Section 17-6-308, MCA, is constitutionally impermissible. We will not undertake to discuss the other issues raised by Hollow.

This opinion shall be and constitute a declaratory judgment in favor of Hollow to the effect that the use of in-state investment funds to guaranty loans or to make loans to the capital reserve account and the economic guaranty fund as provided in Section 17-6-308, MCA, is invalid under the Montana Constitution. This opinion, without the filing of further instruments or orders shall be and constitute such a declaratory judgment.

Except for activities related to the in-state investment fund, nothing in this opinion affects the validity of state actions through the capital investment fund or the economic development guaranty fund. Under Huber, supra, the “moral commitment” statutes of the latter two funds do not constitute a pledge of the state’s credit to underpin the funds.

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

MR. JUSTICE MORRISON,

dissenting:

I respectfully dissent.

I find no real problem with the procedural and factual discussion found in the majority opinion. My first disagreement begins with whether a guarantee is an investment or a debt.

In holding a guarantee to be a debt, the majority relies on Webster’s definition of “investment” as being “the outlay of money usually for income or profit; capital outlay.” Some reliance is also placed upon Section 28-11-101, MCA, which provides a guarantor agrees to answer for the debt of another.

The majority fails to discuss the October 18, 1984, informal opinion of the Attorney General determining that a guarantee of a bond is a security and the purchase of a security is an investment; therefore, the guarantee of a bond is an investment. The opinion states:

“Neither ‘guarantee’ nor ‘investment’ is defined in the Montana Code. However, Black’s Law Dictionary 741 (5th Ed. 1979), defines ‘investment’ as ‘to purchase securities of a more or less permanent nature . . Security is defined by the Montana Code as the guarantee of a bond. Section 30-10-103(11), MCA.”

The majority opinion also ignores the obvious - there is less risk associated with a guarantee of a bond than with the issuance of a bond. The State may collect from a solvent principal any money expended by the State as guarantor. Furthermore, according to Section 17-6-308(2), MCA, the guarantee must provide that the board is fully subrogated to the rights of the obligee under the bond. A bond is not a debt under Section 17-5-1523, MCA. This was affirmed in Huber v. Groff (1976), 171 Mont. 442, 558 P.2d 1124. If a bond is not a debt surely a guarantee of a bond is not a debt.

Finally, a guarantee is a contingent liability. Doorly v. Butte and Western Silver Mines (1924), 71 Mont. 529, 533, 230 P. 779, 780. The guarantee depends on a future uncertain event, the failure of the principal to pay the debt. Contingent liabilities are not debts. In Hanson v. City of Havre, et al., (1941), 112 Mont. 207, 212, 114 P.2d 1053, 1056, this Court said:

“The possibility that part of the bonds may have to be paid with monies obtained from the revolving fund which in turn is created by a tax levy on the property of the city does not create a city debt but is merely an arrangement whereby the city, through the revolving funds, loans money to the district, and for which it holds security in the form of a lien.”

The majority opinion finds the statutory scheme here at issue to be unconstitutional because:

1) It uses coal tax monies for private purposes, as opposed to public purposes;

2) It gives private individuals appropriations for industrial and benevolent purposes; and

3) It violates the Unified Investment program by allowing guaranties of private obligations.

This sweeping holding by the majority opinion is not supported by authority and runs contrary to well established law in this state. In Grossman v. State of Montana (1984), [209 Mont. 427,] 682 P.2d 1319, we said:

“The constitutional provision is not violated because the legislature may in making appropriations or other provisions in some way benefit incidentally various private individuals, associations or corporations not under the control of the state. As long as the provisions relating to the expenditure of the funds derived from the proceeds of the bonds are under the control of the state, the constitutional mandate [No appropriations shall be made for religious, charitable, industrial, educational, or benevolent purposes to any private individual, private association, or private corporation not under control of the state] is satisfied.”

Likewise, in Huber, supra, the appropriations were found to go to a public purpose despite benefit to private homeowners, because the Housing Board, which controlled the money, was a public corporation, not a private corporation. We said: “It received all its powers directly from the legislature and its duties and responsibilities are set out clearly by the statute which created it.” 171 Mont. at 457. The same can be said about the Montana Economic Development Board in this instance. Therefore, under relevant precedent, the purpose of the legislation is public, not private.

Likewise, the coal tax money is going to a public purpose. Our language in Grossman is instructive. We said:

“The question of whether a particular purpose for which taxes may be levied and collected is a public purpose is for the legislature in the first instance, and the courts will indulge very reasonable presumption in favor of the legislative decision in this respect. Lewis and Clark County v. Industrial Accident Board (1916), 52 Mont. 6, 155 P. 268.”

Grossman, 41 St.Rep. at 822.

Unfortunately, the effect of the majority opinion casts serious doubt on whether any different program could pass constitutional muster.

The plaintiff contends that S.B. 349 is not a valid appropriation in that it does not specify a fixed amount of loans or guarantees that may be made by the Board and therefore does not comply with Article VIII, Section 14, of the 1972 Montana Constitution which provides:

“Except for interest on the public debt, no money shall be paid out of the treasury unless upon an appropriation made by law and a warrant drawn by the proper official in pursuance thereof.”

Defendant argues that an appropriation by the legislature is not required to validly authorize the In-State Investment Fund to be invested in a guarantee or loan as contemplated by S.B. 349 in that an investment is neither a debt nor an expenditure.

Twenty-five percent of the coal severance tax trust fund constituting the in-state investment fund has been appropriated by act of the legislature. The defendant argues that the investment thereof, as opposed to the expenditure of the principal, does not require an appropriation. I agree. Just as a legislative appropriation is not required each time the Board of Investments invests each of the funds subject to its control under the Unified Investment Program, neither should one be required each time the Montana Economic Development Board purchases a loan or issues its guarantee.

The majority opinion fails to discuss the important constitutional issue of whether the legislature unconstitutionally delegated its authority to the Board in allowing it to set the limits of liability. The test is found in Douglas v. Judge (1977), 174 Mont. 32, 39, 568 P.2d 530, where this Court said:

“. . . a statute is complete and validly delegates administrative authority when nothing with respect to a determination of what is the law is left to the administrative agency, and its provisions are sufficiently clear, definite, and certain to enable the agency to know its rights and obligation.”

Here the Board has been given specific guidelines for the investment of the in-state investment fund. Investments from the fund should:

a) diversify, strengthen and stabilize the Montana economy,

b) increase Montana employment and business opportunities,

c) maintain a clean and healthful environment, and

d) give preference to business investments that

i) are for locally owned enterprises that are either expanding or establishing new operations;

ii) provide jobs that will be substantially filled by Montana residents;

iii) encourage or benefit the processing, refining, marketing and innovative use and promotion of Montana’s agricultural products; or

iv) benefit small and medium-sized businesses.

Section 17-6-309, MCA.

With respect to amounts, the Legislature has prohibited the use of the fund for:

“a) direct loans;

“b) investments that would result in one business enterprise receiving a benefit from or incurring a debt to the fund in excess of 10% of the prior fiscal year’s coal severance tax revenue deposited in the fund; and

“c) participation in loans to an extent greater than 80% of the loan.”

Sections 17-6-310 through 312, MCA.

I believe the guidelines are sufficiently definite and the delegation is lawful. In Grossman v. State of Montana, supra, we said:

“Here the enactments of the legislature are complete and delegate to the Board of Natural Resources and Conservation and the Department of Natural Resources and Conservation administrative authority which is sufficiently clear, definite and certain to enable the agencies to know their respective rights and obligations. Huber v. Groff (1976), 171 Mont. 442, 558 P.2d 1124; Montana Milk Control Board v. Rehberg (1962), 141 Mont. 149, 376 P.2d 508. Determinations of economic and environmental feasibility are far more appropriate in the administrative sector than in the legislative branch. There is nothing improper, constitutionally or otherwise, in the legislature making its authorizations contingent upon administrative decisions properly made in the executive side of the state government.”

I find Grossman to be controlling here. We should determine that the delegation of authority is constitutional.

The plaintiff had the burden of persuasion in this case. He must show beyond a reasonable doubt that S.B. 349 violates some specific requirement of the Montana Constitution. If the constitutionality of an act is doubtful the court should resolve all doubts in favor of the validity of the act. Tipton v. Erickson (1933), 93 Mont. 446, 19 P.2d 227. The only troublesome feature I find is administrative rule, A.R.M. Section 8.97.413. After quoting the administrative rule the majority opinion states that:

“The potential liability of the state is for the full amount of all guaranties made by the Board which can be as great as two times the amount of the in-state investment fund.”

The administrative rule can not invalidate the statutory scheme. The heavy presumption in favor of constitutionality has not been overcome by plaintiffs. If the majority wished to find the administrative rule to be an improper construction of the statutes it should have done so but should have preserved the integrity of the statutes themselves.

Under previous decisions of this Court herein cited the basic statutory framework passes constitutional muster. I would issue a declaratory judgment upholding the statutory scheme.


author: MR. JUSTICE HARRISON

text:
    THE CITY OF HELENA, Plaintiff and Respondent, .v KEITH OWEN DAVIS, Defendant and Appellant.
    No. 86-55.
    Submitted on Briefs June 24, 1986.
    Decided Aug. 8, 1986.
    Rehearing Denied Sept. 2, 1986.
    723 P.2d 224.
    Leo J. Gallagher, Helena, for defendant and appellant.
    Hull & Sherlock, David Hull, Helena, for plaintiff and respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

This is an appeal by the defendant from his conviction for the offense of driving under the influence of alcohol or drugs in violation of 61-8-401, MCA. The only contention raised by the defendant on appeal is whether the trial court properly instructed the jury with regard to the above charged offense. We reverse and remand this case for a new trial consistent with this opinion.

On April 14, 1985, the defendant-appellant, Keith Owen Davis (hereinafter “Davis”), was arrested for driving under the influence of alcohol or drugs in violation of Section 61-8-401, MCA. The defendant was convicted of the charged offense in Helena City Court and he appealed his conviction to the District Court. In a trial de novo before the District Court of the First Judicial District a jury of six persons convicted the defendant of the same charged offense.

Section 61-8-401, MCA, reads in pertinent part as follows:

“Persons under the influence of alcohol or drugs. (1) It is unlawful and punishable as provided in 61-8-714 for any person who is under the influence of:

“(a) alcohol to drive or be in actual physical control of a vehicle upon the ways of this state open to the public;

“(b) a narcotic drug to drive or be in actual physical control of a vehicle within this state;

“(c) any other drug to a degree which renders him incapable of safely driving a vehicle to drive or be in actual physical control of a vehicle within this state; or

“(d) alcohol and any drug to a degree that renders him incapable of safely driving a vehicle to drive or be in actual physical control of a vehicle within this state.

“(2) The fact that any person charged with a violation of subsection (1) is or has been entitled to use alcohol or such a drug under the laws of this state does not constitute a defense against any charge of violating Subsection (1).

“(3) Upon the trial of any civil or criminal action or proceeding arising out of acts alleged to have been committed by any person driving or in actual physical control of a vehicle while under the influence of alcohol, the concentration of alcohol in the person’s blood at the time alleged, as shown by chemical analysis of the person’s blood, urine, breath, or other bodily substance, shall give rise to the following presumptions:

“(a) If there was at that time an alcohol concentration of 0.05 or less, it shall be presumed that the person was not under the influence of alcohol.

“(b) If there was at that time an alcohol concentration in excess of 0.05 but less than 0.10, that fact shall not give rise to any presumption that the person was or was not under the influence of alcohol but such fact may be considered with other competent evidence in determining the guilt or innocence of the person.

“(c) If there was at that time an alcohol concentration of 0.10 or more, it shall be presumed that the person was under the influence of alcohol. Such presumption is rebuttable.

“(4) The provisions of subsection (3) do not limit the introduction of any other competent evidence bearing upon the issue of whether the person was under the influence of alcohol. (Emphasis added.)

The jury was instructed, over defense counsel’s objection, that the law as it relates to Section 61-8-401 was as follows: .

“You are instructed that the expression ‘under the influence of alcohol’ covers not only all the well-known and easily recognized conditions and degrees of intoxication but any abnormal mental or physical condition which is the result of indulging in alcohol to any degree, and which tends to deprive a person of that clearness of .intellect and control of himself which he would otherwise possess. If the ability of the driver of an automobile has been lessened in the slightest degree by the use of alcohol, then the driver is deemed to be under the influence of alcohol. The mere fact that a driver has taken a drink does not place him under the ban of the statute unless such drink has some influence upon him, lessening in some degree his ability to handle said automobile.” (Emphasis added.)

Davis now presents the following issue for review by this Court: Whether the District Court erred by giving a jury instruction that was at variance with the statute defining the offense for which he was charged and convicted.

In his brief, Davis argues because he was charged with driving under the influence of-both alcohol and drugs pursuant to (l)(d) of Section 61-8-401, the law clearly states he is not guilty unless his driving ability was impaired “to a degree that [rendered] him incapable of safely driving a [motor] vehicle.” But rather than instructing the jury as to the criteria set forth in the statute, Davis argues, the trial court instructed the jury to convict him if his ability to drive was “lessened in the slightest degree.”

Davis concedes the jury instruction given by the trial court was approved by this Court nearly 27 years ago in State v. Cline (1959), 135 Mont. 372, 339 P.2d 657. However, Davis argues, the instruction approved in Cline related only to a situation- where the defendant was charged and convicted of driving under the influence of intoxicating liquor. In approving the instruction in Cline, Davis points out, this Court interpreted Montana’s 1955 version of its DUI law and noted “the Legislature . . . placed no limitations on the extent of the influence of intoxicating liquor required to come under the statute . . . [and] the instruction, taken as a whole, correctly states the law in Montana as applicable to a case of this kind.” Cline, 339 P.2d at 662. Montana’s 1955 DUI law (Art. IV, Section 39, Chapter 263 of the Session Laws for 1955) provided as follows:

“Persons under the influence of intoxicating liquor or of drugs.

“(a) It is unlawful... for any person who is under the influence of intoxicating liquor to drive or be in actual physical control of any vehicle within this state, (b) It is unlawful... for any person who is an habitual user of or under the influence of any narcotic drug or who is under the influence of any other drug to a degree which renders him incapable of safely driving a vehicle to drive a vehicle within this state. The fact that any person charged with a violation of this paragraph is or has been entitled to use such drug under the laws of this State shall not constitute a defense against any charge of violating this paragraph.” (Emphasis added.)

Unlike the defendant in Cline, Davis argues, he was charged with driving under the influence of both alcohol and drugs. Further, unlike the offense charged in Cline, Davis asserts, the statute he was charged and convicted of violating does contain a clear legislative directive as to the extent of influence of the intoxicants. The offense charged in this case does not say the law is broken if one drives while impaired to the “slightest degree;” rather, the law states an offense is committed if one’s driving ability is impaired “to a degree that renders him incapable of safely driving a [motor] vehicle.” Davis argues the trial court committed reversible error by instructing the jury to convict him on the basis of a factual criteria that is at variance with the criteria used by the legislature in defining the elements of the crime. Had the jury in this case been fully and fairly instructed on the law as passed by the legislature, Davis argues, he may not have been convicted.

Although we do not totally agree with the argument presented by Davis, we do feel he has brought to light one very important point — the Cline instruction no longer reflects the law in Montana as passed by our legislature.

First, it must be noted that Davis was not charged with driving under the influence of both alcohol and drugs pursuant to (1) (d) of Section 61-8-401 as he suggests. Rather, Davis was charged with a violation of Section 61-8-401 generally. In other words, Davis was charged with driving while under the influence of alcohol and/or drugs.

Next, we feel it is important to review the argument presented by the City of Helena. The City of Helena, of course, strongly argues that the jury instruction given and approved in Cline, supra, was also appropriately given in the instant case. As noted above, this Court in Cline interpreted Montana’s 1955 DUI law and determined that the offered instruction correctly stated the law in Montana as applicable to a case of that kind. In both Cline and the instant case the defendants were charged with driving under the influence of alcohol (intoxicating liquor). It is also important to note, the City of Helena argues, that both Montana’s 1955 DUI law and today’s DUI law are essentially the same (see above). A comparison of the former law with today’s law reveals that despite its many amendments the legislature has left intact the original criteria regarding the degree of impairment the state must prove in order to convict an individual of driving under the influence of alcohol or drugs. Therefore, since the instruction given and approved in Cline was based upon the same laws and situation as found in the instant case, the City of Helena argues, it was proper that the Cline instruction was given in this case. We disagree.

Simply put, we hold the Cline instruction no longer states the law in Montana. We find since this Court approved the Cline instruction in 1959, the legislature has significantly revised this State’s DUI law. Although a comparison of Montana’s original DUI law and today’s DUI law reveals that the legislature has left intact much of the statute’s original language, the legislature has also made some critical additions to the statute since it was first enacted. The most important addition to the DUI law has been subsection (3) of Section 61-8-401 which sets forth the various presumptions that may be read to a jury when a person is charged with driving under the influence of alcohol (see above). Obviously, this section of the DUI law was not available to this Court when we approved the Cline instruction. In fact, in Cline, we held that because the legislature had placed no limitation on the extent of the influence of alcohol required to come under the DUI statute, we could justifiably adopt the offered instruction. As this Court stated in Cline:

“This identical instruction was given in an Arizona case, Steffani v. State, 45 Ariz. 210, 42 P.2d 615, 618. The court there made the observation that the Legislature of the State placed no limitation on the extent of the influence of intoxicating liquor required to come under the statute, and held that they could not add to the language of the statute. We believe that the instruction, taken as a whole, correctly states law in Montana as applicable to a case of this kind.” Cline, 339 P.2d at 662. Clearly, this is not the situation under Montana’s current DUI law.

In conclusion, we hold the Cline instruction is no longer a proper statement of the law in this State and the instruction must either be revised or abandoned to conform with the provisions of Section 61-8-401. As noted above, we find the legislature today had specifically spelled out in Section 61-8-401 the extent of the influence of intoxicants necessary to be convicted of driving under the influence of alcohol or drugs. As applied to the instant case, Davis is entitled to a new trial with the jury being instructed as to proper criteria set out in Section 61-8-401 which is applicable to a charge of driving under the influence of alcohol and/or drugs.

The conviction of the defendant is reversed and this matter is remanded for a new trial consistent with this opinion.

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