author: JUSTICE TRIEWEILER JUSTICE GRAY, JUSTICE WEBER

text:
    DEAN HOWARD, Plaintiff and Appellant, v. CONLIN FURNITURE NO. 2, INC., a Montana corporation, Defendant and Respondent,
    No. 94-528.
    Submitted on Briefs March 30, 1995.
    Decided August 21, 1995.
    52 St.Rep. 814.
    272 Mont. 433.
    901 P.2d 116.

      For Appellant: Michael G. Eiselein, Lynaugh, Fitzgerald, Eiselein & Eakin, Billings.
    For Respondent: T. Thomas Singer, Moulton, Bellingham & Mather, Billings.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

The plaintiff, Dean Howard, filed a complaint and an amended complaint in the District Court for the Thirteenth Judicial District in Yellowstone County in which he alleged that he had been wrongfully discharged from his employment by the defendant, Conlin Furniture No. 2, Inc. (Conlin). In response to Conlin’s motion for summary judgment, the District Court concluded that Howard failed to raise genuine issues of material fact, and that Conlin was entitled to judgment dismissing Howard’s complaint as a matter of law. Howard appeals from the District Court’s order and judgment. We reverse the judgment of the District Court.

The issue on appeal is whether the District Court erred when it granted Conlin’s motion for summary judgment.

FACTUAL BACKGROUND

Paul Gunville is the president of 16 Conlin furniture stores, including stores in Montana, each of which is individually incorporated. In 1990, Gunville recruited Dean Howard from Baers Furniture to work for Conlin’s store in Billings. Howard began to work as Conlin’s manager on September 4,1990, and was paid a salary in the amount of $50,000 annually, plus a commission. On May 4, 1992, Gunville evaluated Howard’s performance as manager to that date by concluding that: “Dean has brought strength in leadership and great management tools with an underlying desire to be and teach success. Dean will only get better as his experience in mdse, and general furniture business increases.” He concluded by stating that Howard’s potential for advancement in the company is “outstanding.”

In late 1992, Gunville hired Robert Anderson from Rhodes Furniture Store in Atlanta, Georgia, to work as a district supervisor for four of his stores in Montana. Anderson began work in Billings in January 1993.

Anderson took over Gunville’s role as Howard’s supervisor.

Before Anderson left Atlanta, Doug Sahr, who also worked for Rhodes, asked Anderson to keep Sahr in mind for positions that might become available.

After Anderson began work for Conlin, he telephoned Sahr to determine whether he was interested in a position as a manager. Anderson testified that he may have telephoned Sahr in March 1993. Howard produced telephone records that indicated several telephone calls were made from the Conlin No. 2 store in Billings to Sahr’s home telephone number, as well as to Rhodes Furniture Stores in Atlanta, in February and March 1993. During that same month, Anderson began to record written complaints regarding Howard’s performance.

On May 20, 1993, Howard was terminated from his position as a store manager and then offered a sales position at a salary of $1000 per month, plus a commission opportunity. He was not first advised of the areas in which he was deficient and given an opportunity to improve his performance. Sahr replaced Howard shortly after Howard was terminated as manager.

On June 28, 1994, Conlin moved the District Court to dismiss Howard’s complaint by summary judgment for the reasons that he was neither actually nor constructively discharged and that there were legitimate business reasons for his demotion. The District Court agreed. It held that Howard’s rejection of the sales job was, at best, a constructive discharge, but that Howard failed to offer evidence that working conditions would have been intolerable. It also held that Conlin offered evidence of reasonable job related grounds for demotion, and that Howard’s alleged reasons were conclusory and speculative.

DISCUSSION

Did the District Court err when it dismissed Howard’s complaint by summary judgment?

This Court reviews an order granting summary judgment based on the same criteria applied by the district court pursuant to Rule 56, M.R.Civ.P. Hagen v. Dow Chemical Co. (1993), 261 Mont. 487, 491, 863 P.2d 413, 416 (citing Minnie v. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214). Summary judgment is an extreme remedy and should not be granted if there is any genuine issue of material fact; a summary judgment procedure should never be substituted for a trial if a material factual controversy exists. Hagen, 863 P.2d at 416 (citing Rule 56(c), M.R.Civ.P; Cereck v. Albertson’s, Inc. (1981), 195 Mont. 409, 637 P.2d 509; Reaves v. Reinbold (1980), 189 Mont. 284, 615 P.2d 896).

A party seeking summary judgment has the burden of establishing a complete absence of any genuine factual issues. Hagen, 863 P.2d at 416 (citing D’Agostino v. Swanson (1990), 240 Mont. 435, 442, 784 P.2d 919, 924). In light of the pleadings and the evidence before the court, there must be no material issue of fact remaining which would entitle a nonmoving party to recover. Hagen, 863 P.2d at 416 (citing Marriage of Hoyt (1985), 215 Mont. 449, 454, 698 P.2d 418, 421). Once the movant has presented evidence to support his or her motion, the party opposing summary judgment must present material and substantial evidence, rather than mere conclusory or speculative statements, to raise a genuine issue of material fact. Hagen, 863 P.2d at 416 (citing B.M. by Berger v. State (1985), 215 Mont. 175, 179, 698 P.2d 399, 401). Finally, all reasonable inferences that might be drawn from the offered evidence should be drawn in favor of the party who opposed summary judgment. Hagen, 863 P.2d at 416 (citing Cereck, 637 P.2d at 511).

In its order, the District Court recognized that Howard alleged that he was discharged, or constructively discharged, from his employment. However, in its discussion, the court stated that the issue was whether Conlin created an intolerable employment situation within the meaning of § 39-2-903(1), MCA, when Conlin demoted Howard. The District Court concluded that Howard did not raise genuine issues of fact which would preclude summary judgment because Howard’s support for the notion that his demotion was a pretext to hire Sahr consisted only of conclusory and speculative statements. Because Conlin supported its reasons for demoting Howard with several job-related incidents, the court concluded that the demotion could be based on reasonable job-related grounds and a logical relationship to the needs of the business. The court also stated that it considered Howard’s claim for actual discharge to be marginal, at best, and focused its analysis on Howard’s claim for constructive discharge.

Howard argues that the District Court erred because it focused on constructive discharge. Howard claims that Anderson admitted he was discharged from his position as store manager, which is not the equivalent of a voluntary termination because of an intolerable working condition.

Conlin contends that Howard was demoted, not discharged. Conlin also claims that we should affirm the District Court’s decision because this Court has upheld a discharge motivated by legitimate business reasons when the plaintiff presents only conclusory allegations. Finstad v. Montana Power Co. (1990), 241 Mont. 10, 29, 785 P.2d 1372, 1383.

Section 39-2-904(2), MCA, states that a discharge is wrongful only if: “the discharge was not for good cause and the employee had completed the employer’s probationary period of employment....” The term “discharge” includes

constructive discharge ... and any other termination of employment, including resignation, elimination of the job, layoff for lack of work, failure to recall or rehire, and any other cutback in the number of employees for a legitimate business reason.

Section 39-2-903(2), MCA. “Good cause” is defined as “reasonable job-related grounds for dismissal based on a failure to satisfactorily perform job duties, disruption of the employer’s operation, or other legitimate business reason.” Section 39-2-903(5), MCA.

The first sub-issue we must decide is whether Howard was discharged, or merely demoted, following which he resigned. In that regard, the statement made by Anderson to the Billings Job Service in response to Howard’s application for benefits, speaks for itself. He stated:

(1) Dean Howard was discharged from the position of store manager on the date noted.
(2) At that time he was offered a sales position at Conlin’s. That offer was declined by Mr. Howard on 5/25/93.

This case does not involve a lateral transfer, nor a minor change in job description. This case involves absolute and final termination from a managerial position, followed by an offer of employment in a functionally different, and substantially inferior, position with the same employer. To hold, as Conlin suggests, that termination of employment in a position that pays over $50,000 per year, and subsequently offering a position which pays less than 25 percent of that amount, is not “a termination of employment” would ignore the plain language of the Act and allow circumvention of the Act’s damage provisions which are based on wages at the time of termination. Section 39-2-905, MCA.

Howard was informed that he was being terminated as Conlin’s manager. He was then offered a subordinate position among the sales staff he previously managed. His refusal to accept an offer of a lesser position, at best, affects his duty to mitigate his damages. We conclude that when Howard was terminated from his managerial position, he was discharged from employment within the meaning of § 39-2-903(2), MCA, of Montana’s Wrongful Discharge From Employment Act.

The second sub-issue is whether Howard’s termination was for good cause as a matter of law, or whether there was a factual issue to be decided.

The only formal evaluation of Howard’s work as manager of the Conlin’s Furniture Store was the evaluation done by the company’s president on May 4, 1992. In that evaluation, Howard was given the highest possible rating for interest in his work, self-confidence, personal characteristics, personal relations, leadership, and customer service. With regard to customer service, his employer wrote “Dean writes the book here!”. He was given above average ratings in practically every other area considered. As recently as March 4,1993, two and one-half months before his termination, his direct supervisor, Anderson, testified that no thought had been given to his termination.

However, Anderson testified that from January 1993 until Howard’s termination as manager, the following events occurred which demonstrated Howard’s unsatisfactory performance of his job duties:

1. The warehouse he was responsible for was found to be in poor condition and disorderly;

2. He credited his account at the store with the value of a rug he had brought to the store from his own home;

3. He was absent an excessive amount of time;

4. He made a personnel decision regarding Connie Smith which caused dissatisfaction from other employees and ultimate payment to Smith of two weeks severance pay;

5. He gave inaccurate information to a customer who then, based on that information, traveled a long distance to the store without being able to accomplish the purpose of her trip;

6. He loaned out a company vehicle which was damaged while being used by a third party;

7. Aletter from a disgruntled employee complained of management performance; and

8. A claim for unpaid commissions was made by a salesperson after her termination from employment at Conlin.

In response to those allegations, Howard testified by deposition that:

1. He had trouble controlling the warehouse because its employees were underpaid and dissatisfied;

2. His Karastan rug was placed on the floor of the store by consignment openly and apparently consistent with past practices;

3. His absences from the store were related to store business;

4. His personnel decision which led to discontent among other employees was a good faith effort to retain an employee who threatened to go to work for a competitor;

5. The misinformation he gave to a long-distance customer was based on information obtained from an inventory sheet which was supposed to be current;

6. When he loaned the company vehicle for use by a third party, he acted consistent with the company’s policy of assisting others for the purpose of public relations;

7. The critical letter from a former employee related to management in general and not him in particular; and

8. The commission payments which were the subject of a claim by a former employee were withheld with the approval of Anderson.

We conclude that these claims, denials, and counterclaims raise a factual issue as to whether Howard was terminated for good cause within the meaning of § 39-2-903(5), MCA, of the Wrongful Discharge From Employment Act.

We held in Guertin v. Moody’s Market (1994), 265 Mont. 61, 874 P.2d 710, that where an employee testified that she had been hard working and loyal and had not received previous complaints from her employer about her management capability; and where she denied that the reasons given by her employer for her termination were correct; there was an issue of fact regarding whether she was terminated for good cause. Likewise, here we conclude that reasonable persons could differ regarding inferences to be drawn from the deposition testimony and exhibits.

Therefore, the judgment of the District Court which dismissed plaintiff’s amended complaint is reversed and this case is remanded for further proceedings consistent with this opinion.

JUSTICES HUNT, NELSON and LEAPHART concur.

JUSTICE GRAY,

dissenting.

I respectfully dissent from the Court’s opinion. The Court resolves the issue before it on the basis of its conclusion that a demotion can be a “discharge,” as opposed to a “constructive discharge,” under § 39-2-903(2), MCA. I cannot agree.

Section 39-2-903(2), MCA, provides in pertinent part:

“Discharge” includes ... any other termination of employment, including resignation, elimination of the job, layoff for lack of work, failure to recall or rehire, and any other cutback in the number of employees for a legitimate business reason.

The plain meaning of the term “termination,” as the word is used in the statute, is “ending;” thus, a “termination of employment” is an ending of employment. The other terms used in § 39-2-903(2), MCA, also connote an ending of employment. In each situation referenced — resignation, elimination of the job, layoff, and the like — the person’s employment has ended. Therefore, I conclude that the statute means what it so clearly says: that a discharge means an ending of employment, nothing more and nothing less.

The Court equates a demotion, or a termination from a particular position with an offer of a different position, to a “termination of employment.” The plain language of the statute does not support such a conclusion. Nor does the Court offer any authority or legal analysis which might support its conclusion. The reason is clear — analysis would be the undoing of the result the Court desires to reach in this regard.

Howard contends that two cases from the Michigan Court of Appeals support his position that the term “termination of employment” includes the term “demotion.” The Court wisely does not rely on these cases, as neither supports its conclusion.

In the wrongful discharge case of Richards v. Detroit Free Press (Mich. App. 1988), 433 N.W.2d 320, the Michigan appellate court states flatly: “A demotion from one job to a lesser job is a discharge from the first job, and a demotion will support a wrongful discharge claim.” Richards, 433 N.W.2d at 322. There are several insurmountable problems with attempting to use Richards as authority in the case presently before us. First, the Michigan court does not quote any controlling wrongful discharge statute such as the one at issue here; thus, no basis is provided on which we properly could reach the same conclusion. Second, the case to which the Michigan court cites in support of its statement, Sepanske v. Bendix Corporation (Mich. App. 1985), 384 N.W.2d 54, was inapposite to the Richards case. Sepanske was a breach of employment contract case, not a wrongful discharge case. Sepanske, 384 N.W.2d at 58-59. Moreover, the statement drawn from Sepanske in Richards simply does not appear, either directly or indirectly, in Sepanske. Finally, and most importantly, the Michigan Supreme Court remanded Richards to the Michigan Court of Appeals for reconsideration. Richards v. Detroit Free Press (Mich. 1989), 448 N.W.2d 351. Thus, the Richards decision is of no force and effect.

The Court suggests that Anderson’s statement to the Billings Job Service “speaks for itself’ with regard to the issue of whether Howard was discharged, or merely was demoted and then resigned. Anderson’s statements that Howard was discharged from the position of store manager and offered a sales position on the same date do, indeed, speak for themselves; they do not, however, speak to the legal issue of whether a demotion is a “termination of employment” under § 39-2-903(2), MCA.

I would affirm the District Court’s determination that a demotion is not a termination of employment and address the issue of constructive discharge on which, in large part, the District Court’s summary judgment ruling was based. The Court having avoided that issue altogether by its unsupported conclusion, there is no point in my addressing it.

CHIEF JUSTICE TURNAGE joins in the foregoing dissent of JUSTICE GRAY.

JUSTICE WEBER

dissents as follows:

I dissent from the Court’s opinion. In doing so, I join in the dissent of Justice Gray.

In addition to the points made by Justice Gray, I point out that the Wrongful Discharge From Employment Act, §§ 39-2-901 to 915, MCA, has additional pertinent provisions. Section 39-2-904, MCA, sets forth the key elements of wrongful discharge as follows:

39-2-904. Elements of wrongful discharge. A discharge is wrongful only if:
(2) the discharge was not for good cause ...

As a result of the foregoing statute, we must first determine if a discharge was not for good cause. Good cause is defined as follows in § 39-2-903, MCA:

(5) “Good cause” means reasonable job-related grounds for dismissal based on a failure to satisfactorily perform job duties, disruption of the employer’s operation, or other legitimate business reason. ...

I emphasize here that good cause relates only to dismissal based on a failure to perform job duties, etc. Justice Gray points out that “termination” is an ending of employment. In the same way, the word “dismissal” is an ending of employment. I conclude this is an additional reason to join in the conclusion of Justice Gray that a discharge means an ending of employment, nothing more and nothing less. I would affirm the District Court’s determination.


source: Caselaw Access Project

author: JUSTICE WEBER

license: Public Domain

text:
    ROBERT C. SCHAAL, Plaintiff and Appellant, v. FLATHEAD VALLEY COMMUNITY COLLEGE, A COMMUNITY COLLEGE DISTRICT OF FLATHEAD COUNTY, MONTANA, Defendant and Respondent.
    No. 94-492.
    Submitted on Briefs March 30, 1995.
    Decided August 28, 1995.
    52 St.Rep. 905.
    272 Mont. 443.
    901 P.2d 541.

      For Appellant: Benjamin W. Hilley, Bigfork.
    For Respondent: Jonathan B. Smith, Deputy Flathead Comity Attorney, Kalispell.
   JUSTICE WEBER

delivered the Opinion of the Court.

This is an appeal from the decision of the Eleventh Judicial District Court, Flathead County concluding Robert C. Schaal (Dr. Schaal) should take nothing by his Complaint, and that Flathead Valley Community College (FVCC) is entitled to judgment on all counts of that Complaint. We affirm.

Appellant, Dr. Schaal, states the issues as follows:

I. Did the District Court err in dismissing Dr. Schaal’s claim that FVCC breached his employment contract?

II. Did the District Court err in dismissing Dr. Schaal’s claim that FVCC breached the covenant of good faith and fair dealing?

III. Did the District Court err in dismissing Dr. Schaal’s claim of violation of due process?

Dr. Schaal was hired by FVCC under a one-year employment contract in June of 1989. Dr. Schaal was similarly employed the following school year but without a formal contract. He was given a one-year employment contract for the 1991-92 school year. The contract contained a provision by which procedures and adopted policies of FVCC were incorporated into the contract. The contract did not contain any provisions for renewal upon expiration.

On June 4,1992, Dr. Schaal was notified by the President of FVCC, Dr. Howard L. Fryett (President Fryett), that he would recommend to FVCC’s Board of Trustees they not renew Dr. Schaal’s contract for the academic year 1992-93. The Board of Trustees met on June 9, 1992, and voted as President Fryett recommended.

Dr. Schaal filed an amended complaint against FVCC on four counts: (1) breach of contract; (2) wrongful discharge; (3) breach of the covenant of good faith and fair dealing; and, (4) violation of due process. FVCC filed an answer and a Motion for Summary Judgment. On April 12, 1993, the District Court granted FVCC’s Motion for Summary Judgment on count (2) and denied the motion on the other counts.

The case came to a non-jury trial on May 5, 1994. At the close of Dr. Schaal’s case, FVCC moved for judgment of dismissal on counts (1), (3) and (4). The District Court set forth four paragraphs of facts agreed to by both parties in the pretrial order and made four additional findings of fact and four conclusions of law. The District Court concluded that Dr. Schaal should take nothing by his Complaint and that FVCC was entitled to judgment on all four counts of the Complaint. Judgment to that effect was entered in favor of FVCC on May 18, 1994. Dr. Schaal appeals from that judgment setting forth the three above listed issues.

I.

Did the District Court err in dismissing Dr. Schaal’s claim that FVCC breached his employment contract?

Dr. Schaal alleges he submitted a grievance to FVCC in the form of a letter to President Fryett in compliance with FVCC’s policy for arbitration of grievances (Policy 930). Dr. Schaal claims his letter was an appropriate submission of grievance because Section 3 of Policy 930 provides a grievant may write his own grievance. Dr. Schaal argues, that because President Fryett did not respond in compliance with the policy, Dr. Schaal was denied his right under contract to have his grievance arbitrated.

FVCC contends Dr. Schaal had no right under the contract to have his grievance arbitrated because he did not use the grievance form mandated by Policy 930, Section 4. FVCC submits that Section 3 of the policy relates only to whether an employee chooses to seek the assistance of the Personnel Office in submitting a grievance; it does not obviate the requirement that the grievance form must be used.

In addition, FVCC argues Dr. Schaal did not pursue his grievance to the next step of the grievance procedure. Policy 930 provides, after a grievance has been submitted to the President and not resolved, grievant may seek review of the President’s decision by the Board Personnel Committee and then by the Board of Trustees. If the grievance is still not resolved, grievant may request binding arbitration. FVCC points out Dr. Schaal did not file a request seeking review of the President’s decision by the Board Personnel Committee. Therefore, FVCC concludes the grievance was assumed resolved in accordance with FVCC’s policies and there was no obligation to arbitrate.

The District Court found Dr. Schaal did not comply with the provisions of the grievance procedure in that he did not use the required form, he did not set forth all information required by the policy, and he did not take any action to move his request to successive steps of the grievance procedure. The court concluded, in light of Dr. Schaal’s failure to comply with FVCC’s grievance procedure, FVCC did not have an obligation to arbitrate the nonrenewal and so there was no breach of policy.

Our standard of review of findings of fact by the District Court in a non-jury trial is set forth in Marriage of Brownell (1993), 263 Mont. 78, 81-82, 865 P.2d 307, 309, as follows:

We review findings of fact by the district court to determine if they are “clearly erroneous.” In re Marriage of Eschenbacher (1992), 253 Mont. 139, 142, 831 P.2d 1353, 1355. In Eschenbacher, we applied the three-part test adopted in Interstate Production Credit Association v. DeSaye (1991), 250 Mont. 320, 820 P.2d 1285. We will review the record to determine if the findings are supported by substantial evidence, and if there is substantial evidence,-we next determine if the district court has misapprehended the effect of the evidence. Even if there is substantial evidence and a proper understanding of the evidence, we may yet declare a finding clearly erroneous when it is clear and definite that a mistake has been committed. See, Eschenbacher, 831 P.2d at 1355.
We review conclusions of law to determine whether the district court’s interpretation of the law was correct. In re Marriage of Burris (1993), 258 Mont. 265, 852 P.2d 616, 619, 50 St. Rep. 525, 526.

Dr. Schaal did not utilize the grievance form required by Policy 930 when he submitted his letter of grievance to President Fryett. Additionally, we note President Fryett’s response to Dr. Schaal’s letter of grievance made clear he would not suggest that Dr. Schaal be reinstated. If Dr. Schaal did not view his grievance as resolved at this point, he should have sought review by the members of the Board Personnel Committee in accordance with Policy 930, Section 5.1.4. Dr. Schaal did not seek such review.

We conclude the District Court’s finding that Dr. Schaal did not comply with the provisions of the grievance procedure is supported by substantial evidence and the District Court did not misapprehend the effect of the evidence. We further conclude there is nothing to indicate a mistake has been committed. We therefore conclude the District Court correctly applied the law when it ruled FVCC had no obligation to arbitrate the nonrenewal of Dr. Schaal’s contract.

We hold the District Court did not err in dismissing Dr. Schaal’s claim that FVCC breached his employment contract.

II.

Did the District Court err in dismissing Dr. Schaal’s claim that FVCC breached the covenant of good faith and fair dealing?

Dr. Schaal refers to this Court’s decision in Haines Pipeline Construction, Inc. v. Montana Power Company (1991), 251 Mont. 422, 830 P.2d 1230, where we stated every contract contains an implied covenant of good faith and fair dealing and a breach of that covenant is a breach of the contract. Dr. Schaal argues FVCC’s failure to follow its own policies is a violation of the covenant of good faith and fair dealing and thus a breach of the contract.

Dr. Schaal contends FVCC is under the supervision and coordination of the Board of Regents, § 20-15-103, MCA. The Board of Regents Policy Manual provides that employees employed for three years must be given six months written notice of intent not to renew their contracts. Dr. Schaal argues FVCC failed to follow this policy when it gave him only sixteen days notice that his contract would not be renewed. Dr. Schaal concludes FVCC’s failure to follow its own policies was a breach of the contract’s covenant of good faith and fair dealing.

In addition, Dr. Schaal claims he was a permanent employee according to FVCC’s policy. The policy provides probationary employees, those employed less than six months, may be discharged without cause. Dr. Schaal argues, because he had been employed for three years, far beyond the probationary period, he was a permanent employee with a reasonable expectation of continued employment. Dr. Schaal concludes that FVCC violated the covenant of good faith and fair dealing by not renewing his contract when he reasonably expected its renewal.

FVCC contends Dr. Schaal had never been a probationary employee nor a permanent employee. FVCC claims he was a contract employee and his contract had no renewal provisions. FVCC argues Dr. Schaal had no reasonable expectation of employment beyond the term of his contract. Therefore, FVCC did not breach the covenant of good faith and fair dealing by not renewing Dr. Schaal’s contract.

Furthermore, FVCC argues the notice requirement of the Board of Regents Policy does not apply here because the Board’s policies apply only to the Montana University System and FVCC is not a part of that system. Therefore, FVCC was not obligated to give Dr. Schaal notice of its intent to not renew his contract under that policy; and so, it did not violate the covenant of good faith and fair dealing.

In Talley v. Flathead Valley Community College (1993), 259 Mont. 479, 489, 857 P.2d 701, 707, we stated “the nature and extent of the obligation of good faith and fair dealing is measured by the justifiable expectations of the parties.” Presently, the District Court made the following finding of fact:

3. ... [Dr. Schaal] signed a one year administrative employment contract with a specific ending date of June 30, 1992. [FVCC]’s policy is incorporated into that contract by reference. However, [Dr. Schaal] has provided no evidence of a policy incorporated by reference into the contract that would give [Dr. Schaal] a reasonable expectation of continued employment after the expiration of that employment contract, and no evidence of any other basis for a reasonable expectation of continued employment after the expiration of that employment contract. [Dr. Schaal] was employed by [FVCC] through June 30,1992, the term set forth in the Contract.

The record contains substantial evidence to support the District Court’s finding of fact. We further conclude there is nothing in the record to indicate a mistake has been committed. Based on its findings, the District Court reached the following conclusion of law:

2. [FVCC] did not violate policy or breach [Dr. Schaal’s] employment contract when it determined that the contract would not be renewed. The nature and extent of the obligation of good faith and fair dealing is measured by justifiable expectation of the parties. Since there was no basis for a reasonable expectation of continued employment beyond the term of [Dr. Schaal’s] contract, [FVCC] did not violate the covenant of good faith and fair dealing when it determined that [Dr. Schaal’s] contract would not be renewed.

We agree.

We hold that the District Court did not err in dismissing Dr. Schaal’s claim that FVCC breached the covenant of good faith and fair dealing.

III.

Did the District Court err in dismissing Dr. Schaal’s claim of violation of due process?

Dr. Schaal refers to this Court’s decision, in Boreen v. Christensen (1994), 267 Mont. 405, 884 P.2d 761, where we held a public employee, who can establish a property interest in employment, must be provided an opportunity to respond to the notice of the employee’s termination prior to that termination. Dr. Schaal claims he had a property interest in his employment based on FVCC’s personnel policies — the Board of Regents Policy providing six months notice of nonrenewal and FVCC’s policy regarding probationary versus permanent employees. Therefore, he claims FVCC violated Dr. Schaal’s right to due process when it denied to him an opportunity to properly respond prior to his termination.

FVCC argues Dr. Schaal’s right to due process was not violated because he did not have a property interest in his employment. FVCC cites to Board of Regents v. Roth (1972), 408 U.S. 564, 577, 92 S.Ct. 2701, 2709, 33 L.Ed.2d 548, 561, where the Court stated:

To have a property interest in a benefit, a person clearly must have more than an abstract need or desire for it. ... He must, instead, have a legitimate claim of entitlement to it.

FVCC contends, for the reasons stated in Issue II, Dr. Schaal had no reasonable expectation of continued employment; and, therefore, he had no property interest in his employment beyond his contract’s termination date.

The District Court found no evidence of a policy which gave to Dr. Schaal a right of employment after the expiration of his employment contract. As a result, the District Court concluded that Dr. Schaal did not have a property right in his employment. The District Court held, since Dr. Schaal did not have a property right in his employment beyond the term of the employment contract, FVCC did not deprive Dr. Schaal of property when it determined his employment contract would not be renewed.

We conclude there is substantial evidence to support the findings of fact of the District Court and we further conclude there is nothing to indicate a mistake has been committed. We agree with the District Court’s conclusion that FVCC did not deprive Dr. Schaal of property when it determined it would not renew his contract.

We hold the District Court did not err in dismissing Dr. Schaal’s claim of violation of due process.

Affirmed.

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


text:
    STATE OF MONTANA, Plaintiff and Respondent, v. RICHARD L. GRAVES, Defendant and Appellant.
    No. 94-414.
    Submitted on Briefs May 12, 1995.
    Decided August 8, 1995.
    52 St.Rep. 755.
    272 Mont. 451.
    901 P.2d 549.

      For Appellant: Anne H. Watson, Watson & Watson, Bozeman.
    For Respondent: Hon. Joseph P. Mazurek, Attorney General; Cregg W. Coughlin, Assistant Attorney General, Helena; Mike Salvagni, County Attorney; Martin Lambert, Deputy County Attorney, Bozeman.
   JUSTICE WEBER

delivered the Opinion of the Court.

This is an appeal from a jury verdict in the Eighteenth Judicial District, Gallatin County and the District Court’s Sentence and Judgment. We affirm.

Five issues were raised on appeal:

I. Did sufficient evidence exist to support the jury verdict?

II. Did the District Court err in admitting into evidence the substance of a 911 call?

III. Did the District Court err in allowing the State to use defendant’s silence, in reference to consensual sexual intercourse, during his interrogation by the West Yellowstone police as evidence against defendant?

IV. Did the District Court err in declining to review testimony with the jury at the jury’s request?

V. Did the District Court err in defendant’s sentencing?

In May of 1991, complainant, Betsy Baker (Betsy), and her boyfriend moved to West Yellowstone and worked at various jobs. They lived in a small trailer behind the Wagon Wheel Apartments.

Betsy testified that, on the evening of August 24,1991, she and her boyfriend ate dinner and then consumed several drinks at a local bar. Ultimately, the boyfriend was found to be driving while under the influence (DUI) and arrested. Betsy testified she did not know what happened to her boyfriend after he got out of the truck. She was advised by onlookers that he had been arrested.

Both defendant and Betsy testified to the fact that defendant approached Betsy and offered to drive her truck home. Betsy agreed. Defendant walked with Betsy to her landlords’ (the Hitzlers) house. Defendant did not enter the Hitzlers’ house but remained outside searching for keys Betsy had dropped on the way to the house. Betsy testified that she discussed with the Hitzlers her concerns about her boyfriend’s arrest. The Hitzlers testified Betsy was clearly drunk at the time.

Betsy and defendant testified, as Betsy left the Hitzlers’ house, defendant pulled up in his own car, told Betsy he had found her keys, and offered her a ride back to the trailer. Defendant followed Betsy into her trailer. Betsy testified that she allowed defendant to stay but told him he could sleep either on the bed or on the couch and she would stay on the other because they were not sleeping together. Betsy testified that defendant told her that was fine.

Betsy then testified she was awakened when she felt someone penetrating her vagina from behind her. She said she “dove off of the bed” and yelled at defendant to “just get the fuck out of here.” Betsy testified defendant told her to “hold on” and calm down, but she kept yelling for him to get out. Before he left, Betsy said she asked him, “Did we make love?” Defendant replied, “I didn’t mean to hurt you,” then ran out the door. Betsy said she wrapped a blanket around herself and sat on the floor crying. At about 5:00 a.m., people who lived close by testified that they heard persistent crying.

Betsy testified that shortly after defendant left, someone knocked on her door and she asked him to call the police. A West Yellowstone police dispatcher said someone called 911 on the night in question and told the dispatcher a woman in a trailer behind the Wagon Wheel was screaming, could hardly speak, and thought she may have been raped. The caller would not give his name nor his location. Later, it was discovered he was a seasonal worker and he was not found nor called as a witness.

The police officer (Officer Burns) testified that, as he approached the trailer, he heard a woman crying loudly. He knocked on the door and saw Betsy on the floor holding a blanket tightly and crying hysterically. He said he recognized her from the earlier DUI stop and arrest. After Betsy calmed down, she told Officer Burns that a man offered to drive the truck home after the arrest and that she had been raped. Officer Burns locked the trailer and transported Betsy to the police department.

Officer Burns located defendant based on Betsy’s description of defendant’s car. Officer Burns said he asked defendant what had happened that night and was told by defendant, ‘What, nothing happened.” When Officer Burns told defendant he knew something happened, he testified defendant admitted that he was with a girl and had given her a ride home but that was all. Officer Burns said he again told defendant there was more that had happened. Defendant then told Officer Burns he approached the girl after her boyfriend was arrested, offered his assistance, and drove her pickup to her trailer. Defendant also told Officer Burns about Betsy losing her keys and going to visit the other people.

Officer Burns said defendant told him that when he and Betsy got to the trailer, she offered to let him sleep in the bed, but that he declined, telling Betsy, “No, that’s your bed. I’ll sleep on the couch.” Defendant told Officer Burns that Betsy was with him on the bed and she began touching him. Defendant claimed they fell asleep and that “[n]othing really happened after that.” Officer Bums asked defendant what happened in the bed; but he said defendant became evasive. Officer Burns then advised defendant of his rights and the interview ended.

On August 25, 1991, defendant was booked and detained at the West Yellowstone, Montana, police station. Betsy and defendant were both taken to Bozeman for a rape examination. Two nonmotile sperm, biologically consistent with defendant, were found in Betsy. Defendant was released after providing police with his permanent address, telephone number, and social security number. On October 15, 1993, defendant was arrested for the offense of sexual intercourse without consent in violation of § 45-5-503, MCA.

Defendant was tried before a jury on March 7-10,1994. He testified on his own behalf at trial. He claimed that, as he drove Betsy home, she sat directly next to him in the truck and placed her hand on his leg. He also claimed she gave him a hug and kissed him affectionately when he said he would go look for her keys. Defendant then testified as to how Betsy and he had finally gone to sleep together and that he awoke when Betsy’s hand was fondling his groin area. He testified that, after about ten or fifteen minutes of foreplay, intercourse took place.

He alleged, afterwards, she caressed his face with her fingers, but suddenly stopped when she felt his mustache. He claimed Betsy got up, went to the bathroom, then came out and asked him, “Can I ask you a question?” Defendant told her, ‘Well, sure.” Defendant then testified that Betsy asked, “Did we just make love?” He said Well, of course we did.” Defendant claimed Betsy got a couple of tears in her eyes, then calmly suggested he should leave.

Defendant testified that he got dressed, returned to his friend’s apartment, and went to sleep.

On March 10, 1994, the jury found defendant guilty of Sexual Intercourse Without Consent. He was sentenced on June 8, 1994, to twenty years’ imprisonment with five years suspended. For purposes of parole eligibility, defendant was designated a dangerous offender. From the final judgment, defendant appeals.

Issue I

Did sufficient evidence exist to support the jury verdict?

Section 45-5-503(1), MCA, states “[a] person who knowingly has sexual intercourse without consent with another person commits the offense of sexual intercourse without consent. ...”

Defendant claims the State failed to prove all of the necessary elements of the alleged crime beyond a reasonable doubt. Defendant admits he knowingly had sexual intercourse with Betsy. However, defendant argues he was led to believe Betsy fully consented to such intercourse.

“Without consent” as used in § 45-5-503, MCA, is defined by § 45-5-501(1), MCA. Section 45-5-501(1), MCA states:

(1)... the term “without consent” means:
(b) the victim is incapable of consent because he is:
(i) mentally defective or incapacitated;
(ii) physically helpless;

Defendant argues the State failed to prove Betsy was incapable of appreciating or controlling her own conduct at the time of sexual intercourse or even earlier the previous evening. Defendant restates various testimony alleging Betsy made numerous thoughtful decisions while in the company of defendant. From this testimony, defendant concludes Betsy clearly possessed the capacity to consent, and to say “no” to sexual intercourse even though later she regretted that course of action.

Defendant further argues the evidence does not support the State’s claim that Betsy was physically helpless, and therefore incapable of consenting. Section 45-2-101(51), MCA, states “ ‘[p]hysically helpless’ means that a person is unconscious or is otherwise physically unable to communicate unwillingness to act.” Defendant contends this Court has never determined “sleep” to be physical helplessness and should not set such a precedent here. In any event, defendant alleges Betsy was clearly not asleep because she was physically active during intercourse.

The State contends defendant’s arguments concerning Betsy’s capacity to consent or say “no” has nothing to do with the facts of this case. The State argues its case is in no way based upon a theory that Betsy was too drunk to make a wise choice about having sex with defendant. The State contends the evidence established that Betsy was “passed out” — in other words, unconscious. Betsy testified she told defendant he could sleep in the bed or on the couch, but they would not be sleeping together. Betsy then passed out on the bed, and defendant removed her pants and underwear and took advantage of her unconscious state. The State concludes there was sufficient evidence in the record to show Betsy was physically helpless and could not have consented; therefore, the jury correctly found defendant guilty of sexual intercourse without consent pursuant to § 45-5-503, MCA.

“In reviewing a jury verdict in a criminal case, the proper inquiry is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. (Citations omitted.)” State v. Little (1993), 260 Mont. 460, 477, 861 P.2d 154, 165. In the light most favorable to the prosecution, the record fully supports the State’s claim that Betsy passed out the night of August 24, 1991; and that defendant, knowing Betsy to be unconscious, penetrated her vagina without her consent.

Defendant’s contention, that no evidence exists as to Betsy’s mental incapacitation, physical helplessness, or defendant’s knowledge of such at the time of sexual intercourse, is incorrect. Betsy testified she had laid on her bed fully clothed that night and “passed out.” She then testified she was awaken by someone penetrating her vagina. In Little, we stated “[w]e have held repeatedly that convictions for sexual intercourse without consent and sexual assault are sustainable based entirely on the uncorroborated testimony of the victim. (Citations omitted.)” Little, 861 P.2d at 165. Here, we have further testimony from both the Hitzlers and Officer Burns that Betsy was obviously under the influence of alcohol on the night in question.

“The credibility of witnesses and the weight to be assigned to their testimony are to be determined by the trier of fact, and disputed questions of fact and credibility will not be disturbed on appeal.” State v. Moreno (1990), 241 Mont. 359, 361, 787 P.2d 334, 336. Additionally, in State v. Losson (1993), 262 Mont. 342, 350, 865 P.2d 255, 260, we stated, “The jury decides the facts and who to believe.”

We conclude, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt. We therefore hold sufficient evidence existed to support the jury verdict.

Issue II

Did the District Court err in admitting into evidence the substance of a 911 call?

In State v. Hall (1990), 244 Mont. 161, 169, 797 P.2d 183, 188, we stated “[i]t is well established that the District Court has latitude of discretion in passing on the admissibility of evidence. [Citations omitted]. The District Court’s determination of the admissibility of evidence is subject to review only for abuse of discretion. [Citations omitted].”

The District Court permitted West Yellowstone Police Dispatcher Helene Rightenour to testify regarding the contents of the emergency 911 telephone call she received on the morning of August 25, 1991. Rightenour testified:

It was a male caller and he said that there was a woman screaming at 421 Gibbon at a little trailer behind the Wagon Wheel Apartments. There was a truck parked out front that had two bicycles on the top. And he had gone over there and the woman was hardly able to speak, but she asked him to call the police, that she thought she might have been raped.

At trial, defendant objected to the District Court allowing the dispatcher to testify as to the substance of the call. Defendant argues the testimony consisted of prejudicially harmful descriptions by the dispatcher of the caller’s description of Betsy’s behavior and requests. Defendant contends it was double hearsay, and doubly unreliable.

Rule 801(c), M.R.Evid., defines hearsay as “a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.”

Defendant argues the present-sense impression exception to the hearsay rule (Rule 803(1), M.R.Evid.) does not apply because the dispatcher was too far removed from Betsy to testify as to her present-sense impression. Defendant further argues the excited utterance exception does not apply because the dispatcher is not relating an event or condition, but is testifying to the caller’s description of the event. Defendant concludes none of these exceptions apply. Thus, he contends the District Court abused its discretion in allowing the prejudicial testimony of the 911 caller as evidence.

The State argues “double hearsay” is not per se inadmissible. Rule 805, M.R.Evid., provides hearsay within hearsay is not excluded under the hearsay rule “if each part of a combined statement conforms with an exception to the hearsay rule provided in these rules.” The State asserts the caller’s statement was not hearsay, under Rule 801(c), M.R.Evid., because it was not offered to prove the truth of the matters asserted. The caller’s statement was offered to prove the time of the victim’s allegation of rape and the reason the police officer arrived at her trailer at 5:11 a.m. We have closely examined the entire record in this case, however, and cannot find any support for the State’s statement in that regard. The prosecutor did not contend before the District Court that the dispatcher’s testimony regarding the contents of the 911 call was not hearsay because it was merely being offered to prove the time of the victim’s allegation of rape and the reason for the officer being sent to her trailer. To the contrary, the prosecutor argued that the testimony was admissible under exceptions to the hearsay rule, thereby implicitly conceding that the testimony was hearsay. Moreover, it was not on that basis that the trial court allowed the testimony. The State’s argument that the testimony was not hearsay is being raised for the first time on appeal; therefore, we will not address that argument further.

The State then argues that Betsy’s statements to the caller fit within several exceptions to the hearsay rule. Betsy was crying hysterically, asked for the police and claimed she thought she had been raped. Her statements reflected an excited utterance, her present-sense impression, and her then existing state of mind, emotion, sensation, and physical condition — all within the hearsay exclusion exceptions under Rule 803, M.R.Evid.

While we concur with the State’s statement that double hearsay is not per se inadmissible, the double hearsay rule does not apply here. The record does not support the State’s contention that the caller’s statement was admissible because it was not hearsay and the police dispatcher was too far removed to testify as to what Betsy said to the 911 caller. The 911 caller is the one who witnessed Betty’s excited utterance, and her then existing state of mind, emotion, sensation, and physical condition. Therefore, the caller was the only one who could testify to what Betsy said and to his present-sense impression of her when she made the statement.

We hold the District Court erred in admitting into evidence the substance of the 911 call. However, we have stated “[t]he admission of improper evidence is not grounds for reversal unless there is a reasonable possibility that the evidence may have contributed to the conviction. [Citation omitted].” State v. Matt (1991), 249 Mont. 136, 145, 814 P.2d 52, 58. All of the basic elements — that Betsy was screaming and had asked the caller to call the police because she thought she had been raped — were established without question by other testimony properly admitted at trial. As a result, while the admission of the testimony was not proper, we conclude it is not reversible error because it did not contribute to the conviction.

We hold that the admission into evidence of the substance of the 911 call was harmless error under these facts.

Issue III

Did the District Court err in allowing the State to use defendant’s silence, in reference to consensual sexual intercourse, during his interrogation by the West Yellowstone police as evidence against defendant?

Defendant argues the State’s improper comment on defendant’s right to remain silent solemnizes the silence into evidence against defendant in direct violation of his Fifth and Fourteenth Amendment rights under the United States Constitution. Defendant did not waive his Miranda rights, thereby assuming he had the right to remain silent under the Fifth Amendment.

Defendant alleges statements referencing his silence did not distinguish between post- and pre-Miranda warnings. Thus, he asserts these statements, in their entirety, were improper under Doyle v. Ohio (1976), 426 U.S. 610, 96 S.Ct. 2240, 49 L.Ed.2d 91, where the Supreme Court held “the use for impeachment purposes of petitioners’ silence, at the time of arrest and after receiving Miranda warnings, violate [s] the Due Process Clause of the Fourteenth Amendment.”

The State contends defendant did not establish a Fifth Amendment nor a Fourteenth Amendment violation. The State stresses the fact defendant was not silent. He voluntarily gave statements to Officer Burns. The State believes it properly used those statements through careful cross-examination to expose defendant’s false testimony when he took the witness stand and gave a very different account of the events leading to and during sexual intercourse.

We agree with the State’s contention. In this case, defendant was cross-examined on statements he voluntarily made to Officer Burns prior to his arrest and how his testimony at trial conflicted with those statements. The fact that defendant’s statements did not include a reference to consensual sexual intercourse is not an indication of silence of the type referred to in Doyle. We conclude the District Court did not abuse its discretion in permitting the State’s impeachment line of questioning. We therefore hold the District Court did not err in allowing the State to use defendant’s silence, in reference to consensual sexual intercourse, during his interrogation by the West Yellowstone policé as evidence against defendant.

Issue IV

Did the District Court err in declining to review testimony with the jury at the jury’s request?

During deliberation, the jury sent a written note to the District Court inquiring as follows:

In reference to Officer Burns [’] statements regarding the conversation with suspect in vehicle in front of apartment—
The question is “Did the defendant tell the officer that he and Betsy had a conversation to the effect that” he (the defendant) could either sleep on the bed or on the couch and she on one or the other [?]

Upon receiving this request, the court consulted with counsel and inquired of their positions. The court’s answer to the jury’s inquiry read, “In the exercise of discretion the [c]ourt has determined that it would be inappropriate to respond to the question you have asked.” Defendant argues the District Court abused its discretion by not responding to the jury’s question. Defendant sets out portions of Officer Burns’ testimony which speak to the jury’s inquiry. Defendant contends the District Court committed reversible error by disallowing that portion of Officer Burns’ testimony to be replayed for the jury during its deliberations as requested. Defendant further argues the District Court erred when it failed to give to the jury the instructions set forth in State v. Henrich (1994), 268 Mont. 258, 267, 886 R2d 402, 408, which specifically deals with requests from the jury about witness testimony.

Section 46-16-503(2), MCA, refers to the jury’s conduct after its retirement.

46-16-503. Conduct of jury after retirement — advice from court....
(2) After the jury has retired for deliberation, if there is any disagreement among the jurors as to the testimony or if the jurors desire to be informed on any point of law arising in the cause, they shall notify the officer appointed to keep them together, who shall then notify the court. The information requested may be given, in the discretion of the court, after consultation with the parties.

The State argues, and we have consistently held, that the decision to replay testimony to the jury, or to refuse a request by the jury to do so, lies within the sound discretion of the district court. Henrich, 886 P.2d at 407; State v. Evans (1993), 261 Mont. 508, 511, 862 P.2d 417, 418; State v. Mayes (1992), 251 Mont. 358, 374, 825 P.2d 1196, 1206; State v. Harris (1991), 247 Mont. 405, 416-17, 808 P.2d 453, 460; State v. Ulstad (1990), 246 Mont. 102, 104, 802 P.2d 1260, 1262. We will review a district court’s decision to allow or disallow a jury’s request to replay trial testimony to determine if the district court abused its discretion. Henrich, 886 P.2d at 407.

After consulting counsel, the District Court commented, “almost any time you respond to a question from the jury, you’re flirting with an error in the case.” The District Court noted Officer Burns’ direct testimony was interrupted by other testimony. He was brought back to the witness stand to complete his direct examination, and to further testify under cross-examination followed by redirect examination; thus, complicating reiteration of his testimony. The court recognized the dangers of emphasizing the testimony of one witness over another, as well as repeating portions of testimony out of context. We, therefore, conclude the District Court did not abuse its discretion in denying the jury’s request.

We hold the District Court did not err in declining to review testimony with the jury at the jury’s request.

Issue V

Did the District Court err in defendant’s sentencing?

Defendant was sentenced to the Montana State Prison for a period of twenty years, with five years suspended. He was ordered to complete the sexual offender treatment program, classified as being a dangerous offender, ordered to register as a sex offender, and required to pay restitution to the West Yellowstone Police Department and the Crime Victims’ Compensation Bureau of the State of Montana in the amount of $285.00.

Defendant contends the District Court, in setting his sentence, failed to consider statutory requirements set forth in § 46-18-101(3), MCA. Defendant further contends the sentence is cruel and unusual punishment under the Eighth Amendment to the United States Constitution in that it is excessive punishment; and, the court has denied defendant equal protection of the laws under the Fifth and Fourteenth Amendments of the United States Constitution.

The State argues § 46-18-101(3), MCA, does not require the District Court to specifically identify each criterion in the sentencing order, but requires sentences to be based “primarily” on the criteria listed. District courts are required only to specifically state, in open court and in the written judgment, the reasons for a sentence. Sections 46-18-102 and -115(5), MCA. The State asserts the court properly set forth, in both open court and written judgment, the reasons it imposed such sentence.

In State v. Cope (1991), 250 Mont. 387, 399, 819 P.2d 1280, 1287, we stated:

We review sentences for legality only. State v. Hurlbert (1988), 232 Mont. 115, 756 P.2d 1110. The standard of review on sentence legality is whether the district court abused its discretion. State v. Lloyd (1984), 208 Mont. 195, 199, 676 P.2d 229, 231. We find no such abuse here, since [defendant’s] sentence is well within the statutory limits. Questions of sentencing equity, on the other hand, are to be presented to the Sentence Review Division. Lloyd, 676 P.2d at 231. If [defendant] wishes to pursue his equity argument, he may do so in the Sentence Review Division.

The above statement applies to these circumstances as well. The sentence is within the guidelines set forth in § 45-5-503(2), MCA, and is, on its face, neither excessive nor cruel. The District Court properly set forth its reasons for the sentence at the hearing and in its judgment; and those reasons did not manifest an abuse of discretion.

We, therefore, hold that the District Court did not err in defendant’s sentencing.

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


text:
    STATE OF MONTANA, Plaintiff and Respondent, v. BENNETT JAMES PACE, Defendant and Appellant.
    No. 93-545.
    Submitted on Briefs May 4, 1995.
    Decided August 10, 1995.
    52 St.Rep. 768.
    272 Mont. 464.
    901 P.2d 557.

      For Appellant: Julie A. Macek, Attorney at Law, Great Falls; William F. Hooks, Appellate Defender, Helena.
    For Respondent: Hon. Joseph P. Mazurek, Attorney General; Patricia Jordan, Assistant Attorney General, Helena; Brant Light, County Attorney, Great Falls.
   JUSTICE WEBER

delivered the Opinion of the Court.

This is an appeal from a judgment based upon a jury verdict in the Eighth Judicial District Court, Cascade County, and the court’s sentence. We reverse and remand.

Defendant, Bennett James Pace, presented four issues for review, but we have determined one issue is dispositive of this case:

Did the District Court err in admitting evidence of alleged other acts pursuant to Rule 404(b), M.R.Evid.?

Facts

On October 8, 1991, two Jehovah’s Witnesses entered the home of Donald John McLeod and found him dead on the floor, partially nude. The estimated date of death was October 6, 1991.

Mr. McLeod suffered multiple stab wounds to the chest with fatal wounds to the heart. A knife, covered with blood of the same type as the victim’s blood, was found on the floor at the crime scene and was determined to be consistent with the weapon that caused the injuries. No latent fingerprints were found on the knife. The lead investigator of the case believed the knife to be from Mr. McLeod’s kitchen. However, relatives were unable to identify the knife.

Based on the physical evidence, the police theorized the murder occurred during a burglary. An entry door appeared forced open. The doorknob was pulled off and the molding was broken. The house appeared to have been ransacked, with items strewn around the kitchen, living room, and bedroom. Several witnesses testified the victim generally kept his house neat and clean. Blood stains on the carpet under papers and clothing scattered on the living room floor indicated that the house had been ransacked after the murder. Relatives of the family were unable to identify any missing possessions of the deceased.

On September 4,1992, defendant was charged by information with deliberate homicide. Defendant was arrested on September 6, 1992, in Spokane, Washington. On April 2, 1993, the information was amended, charging defendant with Count I, burglary, and Count II, deliberate homicide under the felony murder rule as specified in § 45-5-102(1)(b), MCA, or in the alternative, deliberate homicide, a felony as specified in § 45-5-102(1)(a), MCA.

The State filed a notice advising the defendant of its intention to offer evidence of other crimes, wrongs or acts as required under the Modified Just Rule in State v. Matt (1991), 249 Mont. 136, 814 P.2d 52. While the notice as given by the State referred to a number of different incidents, we are concerned here only with two specific incidents, evidence of which was admitted at the trial.

The first incident involved an arrest in Missoula, Montana, on February 21,1991, in which defendant was picked up for panhandling and charged with obstructing a peace officer and carrying a concealed weapon. Defendant possessed a six-inch fillet knife and identified himself using an alias. Additionally, defendant had two wallets with him containing identification cards of three different people.

In the second incident, the State introduced evidence that on March 7, 1992, in Wenatchee, Washington, the defendant, using a different name, was arrested for armed robbery. On his person were found forty-six dollars taken from the victim and a knife.

In the course of the jury trial, the District Court overruled defendant’s objections to the evidence and advised the State it could present evidence of the two above-described incidents. The jury returned a verdict, on April 22, 1993, finding defendant guilty of burglary and deliberate homicide under the felony murder rule. A sentencing hearing was held on July 28, 1993, at which time the District Court pronounced sentence.

Defendant appeals from the judgment.

Issue

Did the District Court err in admitting evidence of alleged other acts pursuant to Rule 404(b), M.R.Evid.?

In State v. Keys (1993), 258 Mont. 311, 314, 852 P.2d 621, 623, we set forth the standard of review of evidentiary rulings. The standard we use is whether the District Court abused its discretion. “The [District [C]ourt has broad discretion to determine whether or not evidence is relevant and admissible, and absent a showing of an abuse of this discretion, the court’s determination will not be overturned.” Keys, 852 P.2d at 623 (citing State v. Crist (1992), 253 Mont. 442, 833 P.2d 1052).

The evidentiary rule at issue is as follows:

Rule 404. Character evidence not admissible to prove conduct, exceptions; other crimes; character in issue.
(b) Other crimes, wrongs, acts. Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show action 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.

Defendant objected to the State’s introduction of evidence involving defendant’s actions in Missoula, Montana, and Wenatchee, Washington, where defendant’s knife was confiscated in both incidents. Defendant argues, while the District Court determined the other acts were used to show “opportunity, identity, and intent,” the only purpose they served was to show bad character. Defendant refers to our decisions in Matt and more recently, State v. Johnston (1994), 267 Mont. 474, 885 P.2d 402, where we discussed admission of other acts when used to infer a defendant’s character.

In Johnston, we stated:

To insure that prior crimes are not used to prove a bad character, this Court has established a four-part test to determine the admissibility of evidence of other crimes or acts in criminal prosecutions. Matt, 814 P.2d at 56. The four elements of that test are: (1) the other crimes, wrongs, or acts must be similar; (2) the other crimes, wrongs, or acts must not be remote in time; (3) the evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show that he acted in conformity with such character; but may be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident; (4) although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusing the issues, misleading of the jury, considerations of undue delay, waste of time, or needless presentation of cumulative evidence. Matt, 814 P.2d at 56. This rule modified the Just rule, which originally set forth the basis for admission of other crimes, wrongs, or acts.

Johnston, 885 P.2d at 404-05.

Defendant asserts the State did not meet the first prong of the test and therefore failed to establish that the other acts were similar. In his analysis, the defendant points out that the State alleged the defendant was guilty of burglary which required that it prove the defendant knowingly entered or remained unlawfully in an occupied structure with the purpose to commit an offense. Section 45-6-204(1), MCA. In a similar manner, in order to prove the defendant guilty of deliberate homicide under the felony murder rule, the State was required to prove the defendant attempted to commit, committed, or was legally accountable for the attempt or commission of burglary and, in the course of such burglary, the defendant or any person legally accountable caused the death of the victim. Section 45-5-102(l)(b), MCA. Last, in order to prove the allegations of deliberate homicide, the State was required to prove the defendant purposely or knowingly caused the death of another human being. Section 45-5-102(l)(a), MCA.

On the issue of similarity, the defendant analogizes the nature of the conduct in the three incidents as follows:

Missoula panhandling incident in February 1991 — involved obstructing a police officer and the carrying of a knife as a concealed weapon. The offense occurred on a street.
Charged offense here in Great Falls in October of 1991 — nature of the conduct was burglary and deliberate homicide (felony murder rule) which occurred in a residence.
Wenatchee incident in March, 1992 — involved a robbery without adequate proof as to where the offense occurred.

With regard to possession or use of a weapon:

Missoula incident — knife was in pocket and also in a bag when searched — knife was not used in the commission of any offense and the knife was seized by the police.
Great Falls incident — knife used as a murder weapon, and knife was found at the scene and seized by the police — it may have belonged to the victim or to the defendant.
Wenatchee incident — testimony fails to establish how or if the knife was used — no specific showing that the knife was used in the commission of any offense, and that knife also was seized by the police.

Number of persons charged and number of victims:

Missoula incident — only defendant arrested and there was no victim.
Great Falls incident — only defendant arrested and there was the one murder victim.
Wenatchee incident — defendant was one of two men arrested and there were two victims.

Continuing that discussion, defendant argues that proof defendant had a knife in Missoula would not prove he had the opportunity to stab the victim in Great Falls because the police took the knife away from him. Likewise, proof that the defendant possessed a knife in March 1992 would not be relevant to show that he killed Mr. McLeod with a knife which was left at the scene of the crime. Defendant argues that the other acts evidence at most gives rise to the inference that because he had a knife at a different time or times, he must have had one at the time of the offense. Defendant asserts this is merely an inference of propensity offered to prove character and prohibited under Rule 404(b), M.R.Evid.

We agree with defendant’s analysis and conclusion on this point. The mere fact that defendant had a knife in his possession on two occasions does not demonstrate the likelihood of his killing the deceased with a knife.

The State argues that the evidence shows a similar intent to obtain other person’s property by use of a knife as a weapon. The State argues that the carrying of knives in the two other incidents makes it more probable that defendant would have carried a knife at the time the homicide occurred. This argument is particularly weak in view of the presence of knives in the dwelling of the decedent so that it was not necessary that the defendant even bring a knife.

The State also contends that it introduced the evidence of the other acts to show defendant’s intent to attack people with knives to get property and to use aliases to escape detection, to show the opportunity to commit the crime, and to show the identity of the perpetrator. The State also contends that the admission of the other acts evidence after the cautionary instructions did not constitute unfair prejudice to the defendant. The other acts were of lesser crimes and would, therefore, not increase a jury’s desire to punish the defendant. Furthermore, the State contends the cautionary instructions given minimized the danger that the jury would use the evidence to infer the defendant had a propensity for bad character.

We stated, in Keys, “the general rule of Rule 404(b) must be strictly enforced except where a departure is clearly justified, and exceptions to the rule must be carefully limited. [Citations omitted].” Keys, 852 P.2d at 623. Evidence of other acts must satisfy all four elements of the Modified Just Rule before it can be admitted. Keys, 852 P.2d at 623, 625. We need not look to opportunity or intent if the other acts are not similar. See Matt, 814 P.2d at 57.

In Matt, we concluded that an incident where the defendant intended to further assault his female assault victim, although he assaulted an intervening police officer, was not sufficiently similar to an assault intended directly at a police officer. Matt, 814 P.2d at 57. We have also held that crimes of forgery and burglary were not sufficiently similar because they are distinctive and their respective elements are quite different. Johnston, 885 P.2d at 405.

In the present case, the defendant’s other acts consisted of using an alias, obstructing a police officer, robbery, and carrying concealed knives. We summarize our conclusion as to the similarity of these acts to the offenses charged as follows. The fact that defendant used an alias and obstructed a police officer is not relevant in proving the act of burglary-homicide. Robbery on a street is not necessarily similar nor comparable to burglary within a dwelling resulting in homicide. Defendant’s act of carrying a knife while panhandling is not in any way similar to the use of a knife in the course of a burglary-homicide. Defendant’s act of carrying a knife in the Wenatchee incident, where it was unclear as to whether the knife was even used, also lacks similarity to the use of a knife in the course of a burglary-homicide. We, therefore, hold defendant’s other acts are dissimilar in their respective elements from the act of burglary, deliberate homicide through felony murder, or plain deliberate homicide.

We hold defendant’s other acts are not sufficiently similar to the charged offense to satisfy the first element (similarity of acts) of the Modified Just Rule. As in Johnston, we determine there is no need to analyze subsequent elements of the Modified Just Rule because the first element was not met. See Johnston, 885 P.2d at 405.

We conclude the District Court abused its discretion in admitting evidence of the other acts pursuant to Rule 404(b), M.R.Evid.

The judgment is reversed and this case is remanded for a new trial.

JUSTICES GRAY, HUNT, TRIEWEILER and LEAPHART concur.


author: JUSTICE GRAY

text:
    FARMERS UNION CENTRAL EXCHANGE, INCORPORATED, d/b/a CENEX, Petitioner and Appellant, v. THE DEPARTMENT OF REVENUE OF THE STATE OF MONTANA, and THE STATE TAX APPEAL BOARD OF THE STATE OF MONTANA, Respondents and Respondents.
    No. 95-130.
    Submitted on Briefs June 20, 1995.
    Decided August 17, 1995.
    52 St.Rep. 810.
    272 Mont. 471.
    901 P.2d 561.

      For Appellant: David A. Veeder, Veeder Law Firm, Billings.
    For Respondent: Lawrence G. Allen, Special Assistant Attorney General, Montana Department of Revenue, Helena.
   JUSTICE GRAY

delivered the Opinion of the Court.

The Thirteenth Judicial District Court, Yellowstone County, affirmed a decision of the State Tax Appeal Board (STAB) concerning the proper tax classification of certain property owned by Farmers Union Central Exchange, Inc., d/b/a Cenex. Cenex appeals. We affirm.

The issues before us are whether the District Court applied the correct standard of review and whether it erred in affirming STAB’s conclusion that the disputed property was class eight property rather than class four property.

This action involves the classification, for state tax purposes, of equipment and machinery added to the Cenex oil refinery complex near Laurel, Montana, in 1991. The refinery complex is comprised of a raw material storage facility, a refinery processing facility, and a product blending and storage facility.

An industrial appraiser for the Department of Revenue (DOR) classified and appraised the new property for the year 1992. He determined that the property here in dispute was class eight property pursuant to § 15-6-138(l)(c) and (o), MCA.

Section 15-6-138(l)(c), MCA, provides that “all manufacturing machinery, fixtures ... [and] equipment” is class eight property. The items of property so classified included a boiler house fuel gas manifold, cooling tower header improvements, a coal filter bed upgrade, three parts of a hydrocarbon loss recovery system, a plant air drier, an opticrom ADV gasoline chromatograph, a Grabner CCA-V, an alky unit KOH scrubber, two oxygen analyzers, asphalt product handling improvements, a crude truck unloading system for tank storage, a heavy product flash point tester, and two spare fuel oil pumps.

Section 15-6-138(l)(o), MCA, provides that “all other property not included in any other class in this part” shall be taxed as class eight property. The DOR appraiser placed eight hydrogen sulfide and carbon dioxide monitors, a breathing air compressor, a manlift, and tank level gauges in this category.

Cenex appealed the DOR’s assessment, arguing that some items of property had been improperly classified as class eight property. It contended that these items are components of a storage facility and, as a result, are class four property under § 15-6-134, MCA. The rate of taxation is significantly lower for class four property than for class eight property.

The Yellowstone County Tax Appeal Board granted Cenex the class four classification it requested on most of the disputed property, with the exception of some computer software. The DOR then appealed to STAB, which reversed the decision of the Yellowstone County Tax Appeal Board and affirmed the DOR’s appraisal and classification regarding the twenty-eight items at issue here.

Cenex petitioned the District Court for judicial review. The District Court affirmed STAB’s decision, thus upholding the DOR’s appraisal and classification. Cenex now appeals to this Court.

Issue 1

Did the District Court apply the correct standard of review?

The standards for judicial review of administrative decisions, such as those of STAB, are set forth in § 2-4-704, MCA. This Court has interpreted § 2-4-704, MCA, to mean that an agency’s findings of fact are subject to a “clearly erroneous” standard of review, while an agency’s conclusions of law are reviewed to determine whether they are correct. Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 474, 803 P.2d 601, 603.

In the present case, STAB specifically concluded as a matter of law that “[t]he disputed properties have been properly classified in class eight.” In reviewing that determination, the District Court reasoned:

At the outset this Court finds that despite [Cenex’s] .contentions that there are no disputes with the Tax Appeal Board’s Findings of Fact, this Court disagrees. The whole matter of fixing a classification of property is factual as well as legal. In short it is a mixed matter of fact and law. This becomes important when the Court makes its determination as to the standard of review.

The District Court applied the three-part “clearly erroneous” standard of review for findings of fact set forth in State Comp. Mut. v. Lee Rost Logging (1992), 252 Mont. 97, 102, 827 P.2d 85, 88.

This Court has stated:

In reviewing conclusions of law, questions of law, or legal components of ultimate facts, or mixed questions of law and fact, we will decide if the ... determination as to law is correct.

Maguire v. State (1992), 254 Mont. 178, 182, 835 P.2d 755, 757-58.

Maguire clarifies that only “pure” findings of fact are reviewed under the clearly erroneous test. The issue of the proper classification of property is reviewed under the “correct interpretation” standard. See United Grain v. Department of Revenue (1991), 248 Mont. 297, 301-03, 811 P.2d 555, 558-59.

The District Court should have reviewed STAB’s conclusion that the DOR had properly classified the property in class eight for its correctness as a matter of law. We conclude, therefore, that the District Court applied the wrong standard of review.

We have stated, however, that where a district court reaches the correct result, the decision will be affirmed regardless of the court’s reasoning. See Lindey’s, Inc. v. Goodover (1994), 264 Mont. 449, 453, 872 P.2d 764, 766 and Usher v. Norwest Capital Mgt. & Trust (1993), 260 Mont. 143, 153-54, 859 P.2d 984, 990. We proceed, therefore, to an analysis of whether STAB’s decision was correct as a matter of law.

Issue 2

Did the District Court err in affirming STAB’s conclusion that the disputed property was class eight property rather than class four property?

The parties agree that the property at issue in this case is properly classified as either class four or class eight property. The property within these classes is set forth in §§ 15-6-134 and 15-6-138, MCA, respectively.

Class four property includes, in pertinent part, “all improvements, including trailers or mobile homes used as a residence, except those specifically included in another class.” Section 15-6-134(l)(b), MCA. ARM 42.22.1303 further elaborates that “all storage facilities shall be treated as improvements to land.”

Class eight property includes, in pertinent part, “all manufacturing machinery, fixtures, equipment ... [and] all other property not included in any other class in this part.” Section 15-6-138(l)(c) and (o), MCA.

STAB determined that the Cenex property did not constitute class four “improvements.” It reasoned that the property was part of an overall manufacturing process and was not part of a storage facility which might then warrant consideration as improvements to land. Therefore, STAB classified each of the twenty-eight items as class eight property, under §’ 15-6-138(l)(c)(c) and (o), MCA.

Cenex argues that the disputed property is not directly used in the manufacturing process and, as a result, that it is class four property rather than class eight property. It cites the testimony of its expert witness, Martin Perga, a chemical engineer employed by Cenex for many years. He testified to the specific use of each item of disputed property. Cenex contends that examining the use of each of the twenty-eight disputed items of property establishes that the property either is not used in the manufacturing process or is part of a storage facility.

At the STAB hearing, Cenex bore the burden of proving that the DOR’s classification was incorrect. See Western Airlines, Inc. v. Michunovich (1967), 149 Mont. 347, 353, 428 P.2d 3, 7, cert. denied 389 U.S. 952, 88 S.Ct 336, 19 L.Ed.2d 363 (1967). Perga, Cenex’s sole witness as to the actual classification of the property, admitted he did not have experience in property tax classification and had not reviewed the relevant Montana property tax classification statutes. On the other hand, during his testimony, the DOR’s appraiser substantiated the statutory and administrative rule bases for his classification of each item of contested property. Thus, we conclude that to the extent its argument is based upon Perga’s testimony, Cenex failed to overcome the presumption that the DOR’s classifications are correct.

Cenex also relies heavily upon this Court’s language in United Grain, where we stated that “§ 15-6-134, MCA, together with ARM 42.22.1303, requires that if the machinery is used in a storage facility it is properly classified as class four.” United Grain, 811 P.2d at 557. Cenex argues that seventeen items were incorrectly classified under § 15-6-138(1)(c), MCA, as part of a manufacturing, rather than a storage, facility.

Cenex’s reliance on United Grain ignores the important distinction we drew in that case between storage and manufacturing facilities. The distinction is based on whether the end product was “significantly changed” from the material entering the facility:

Areview of case law indicates that whether a process constitutes “manufacturing” turns upon whether the end product of the disputed process is “significantly changed” from the original substance. The statutes do not define “manufacturing” but the administrative regulations define “manufacturing property” as that “used to transform raw or finished materials into something possessing a new nature or name and adopted to a new use.”

United Grain, 811 P.2d at 558 (citations omitted). Thus, our resolution of this case depends in large part on whether STAB erred in concluding, based on the evidence before it, that the disputed property which the DOR classified under § 15-6-138(1)(c), MCA, was part of a manufacturing facility as we defined it in United Grain.

Perga testified that the refinery at Laurel receives crude oil by pipeline or truck and stores it in tanks. The processing unit draws on the crude oil contained in the storage tanks to make a number of intermediate products. Several product streams are then blended to achieve a final product. According to Perga, the blending of five product streams to produce a finished product with a given octane ratio was not a “transformation.”

While Perga’s opinion that no transformation occurred may be correct within the purview of chemical engineering, it is not correct within the purview of the law. Indeed, Perga’s testimony supports STAB’s conclusion that the process which involved the disputed property is a manufacturing process rather than a storage process under United Grain.

Cenex receives crude oil, processes it into intermediate products which differ from the crude oil received and then blends those products into a finished product. Cenex does not market any of the intermediate products separately; the blending is a necessary process for achieving a finished product marketable by Cenex. Thus, “the end product ... is ‘significantly changed’ from the original substance” received by Cenex. See United Grain, 811 P.2d at 558. The property the DOR classified as class eight under § 15-6-138(1)(c), MCA, is used in connection with the process of transforming materials into something possessing a new nature and, therefore, it constitutes manufacturing property. See United Grain, 811 P.2d at 558. STAB cogently summarized the dissimilarity between the facility in this case and the facility we determined to be a storage facility in United Grain as follows:

The most conclusive disparity in attempting to use United Grain as a probative foundation for Cenex, lies in the contrasts between the two firms in the performance of the acts of storage. United Grain is a storage business; it can provide a storage service for customers or for itself; it may accept products from a large clientele; it does no manufacturing; it sells its product to a large class of potential buyers and users.
By contrast, from the record, Cenex does not have or solicit storage customers; no businesses bring materials or products to be stored; Cenex does not sell intermediate products for itself or others for purposes not related to its refinery function and activities, including the processing and sale of waste products. Cenex is an integrated manufacturer; its products are designed to be produced by it and to be sold through its own network of outlets... . We repeat, Cenex performs storage functions but it is not a storage facility.

Finally, Cenex incorrectly asserts that class eight property includes only property used directly in a manufacturing process. While it is true that § 15-6-138(1)(c), MCA, specifically includes manufacturing machinery, fixtures, equipment, and tools, § 15-6-138(1)(o), MCA, includes as class eight property “all other property not included in any other class in this part.” The words “in this part” clearly relate to all of Title 15, Chapter 6, part 1, MCA, which is captioned “Classification” and includes class one property through class twelve property. Thus class eight property, including the eleven items here classified under subsection (1) (o), is not limited to property used directly in a manufacturing process.

We conclude that STAB did not err in classifying the disputed items of Cenex property as class eight property. Therefore, we hold that the District Court did not err in affirming STAB’s decision.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES TRIEWEILER, NELSON and LEAPHART concur.