text:
    DECKER COAL COMPANY, Plaintiff v. COMMONWEALTH EDISON COMPANY, Defendant.
    No. 85-242.
    Submitted Dec. 5, 1985.
    Decided Feb. 20, 1986.
    714 P.2d 155.
    Crowley Law Firm, Jack Ramirez argued, Billings, Dykema, Gos-sett, Spencer, Goodnow & Trigg, Donald S. Young, Derek I. Meier, Jeffrey M. Lipshaw, Daniel J. Stephenson, Detroit, Mich., George F. Heiden, Omaha, Neb., for plaintiff.
    Hooks & Budewitz, Patrick J. Hooks argued, Townsend, Isham, Lincoln & Beale, Donald J. McLachlan, James A. Fletcher, Michael J. Gill, James K. Meguerian, Chicago, 111., for defendant.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

This case is before the Montana Supreme Court pursuant to a certification by the United States Court of Appeals for the Ninth Circuit. Plaintiff Decker Coal Company (“Decker”) brought suit against defendant Commonwealth Edison Company (“Edison”) in the United States District Court for the District of Montana. Edison moved to dismiss the complaint, asserting, among other things, that Decker lacked the capacity to sue in its own name. The District Court held that Decker does have the capacity to sue in its own name, and Edison appealed. The Ninth Circuit viewed the capacity question as important to the resolution of this dispute and certified the issue to this Court.

For the reasons discussed below, we find that under Montana law Decker has the capacity to maintain a suit against Edison in its own name and consequently we answer the certified question presented by the Ninth Circuit in the affirmative.

Decker Coal Company is a joint venture between Wytana, Inc., a Delaware corporation, and Western Minerals, Inc., an Oregon corporation. It is engaged in the surface mining of low sulphur coal and operates its plant in Decker, Montana. Commonwealth Edison Company is an Illinois corporation. In 1974, Decker Coal and Edison entered a long-term contract under which Decker agreed to supply coal to Edison in quantities between minimum and maximum tonnages from 1978 to 1997.

Article XI of the contract contained a force majeure provision which allowed performance to be deferred or excused upon certain events. The contract called for delivery F.O.B. the Montana mine. The coal would then be shipped via railroad to Edison plants in Illinois and Indiana.

Edison invoked the force majeure provision to defer or terminate coal purchase obligations in May, June and July, 1983. Edison claimed that structural damage to its plant in Illinois and a cracked turbine rotor at its Indiana plant justified invocation of the force majeure provision.

On January 4, 1984, Decker filed a complaint in the United States District Court for the District of Montana seeking a declaration that the problems at the Edison plant did not qualify as force majeure events. Decker also sought damages for breach of contract, claiming that Edison failed to take sufficient measures to prevent damage to its generating plants thereby breaching an alleged contractual duty to mitigate damages.

Several days later, Edison filed an action in the Northern District of Illinois seeking a declaration that it properly invoked the force majeure provision of the contract.

On February 3, Decker filed a motion in the Montana action to enjoin further prosecution of the Illinois case. On February 8, Edison filed a motion to dismiss the Montana complaint on the grounds that: (1) Decker lacked capacity to maintain the action in its own name; (2) the District Court did not have personal jurisdiction over Edison; and (3) the District of Montana was an improper venue. Edison also sought transfer of the case to the Northern District of Illinois.

The Montana District Court, Chief Judge Battin, ruled that jurisdiction was properly asserted, that venue was proper in Montana because the alleged contract breach occurred in Montana, and that Decker had the capacity to sue as a partnership entity under Montana law. The motion to transfer was denied, and the motion to enjoin the Illinois proceeding was granted.

Edison appealed from the Montana District Court’s order to the United States Court of Appeals for the Ninth Circuit. On appeal, Edison raised the issues of capacity, jurisdiction, and venue. Following full briefing and oral argument, the Ninth Circuit determined that the capacity issue, which is governed by Montana law, may be dispositive of this case. Accordingly, by an order dated March 21, 1985, it has certified the following question to this Court:

“Does Decker Coal Company, as a joint venture between two out-of-state corporations, have capacity to bring suit as a plaintiff against a corporation under Montana law?”

Both Decker and Edison agree that under Montana law, Decker’s capacity to maintain its Federal Court action is governed by statute. Rule 17(b) of the Federal Rules of Civil Procedure provides that the capacity of a party (other than an individual or a corporation) to sue “shall be determined by the law of the state in which the District Court is held.” Thus, Montana law governs the question of Decker’s capacity to bring suit against Edison in the Montana District Court. If Decker lacks capacity to maintain suit in the state courts of Montana, it likewise lacks capacity to sue in Montana Federal Court.

Under Montana law, Rule 17(b) of the Montana Rules of Civil Procedure governs capacity to sue in Montana courts. Montana Rule 17(b) provides that “[t]he capacity of persons to sue and be sued shall be determined by appropriate statutory provisions.” Thus, both parties agree, Montana Rule 17(b) is entirely dispositive of the question before this Court. Therefore, early Montana cases which disputably held that a partnership does not have the capacity to maintain a suit in its own name are of little value. See Gardiner v. Eclipse Grocery Company (1925), 72 Mont. 540, 234 P. 490; Wilson v. Yegen Bros. (1909), 38 Mont. 504, 100 P. 613. It should also be noted that under Montana law a joint venture (such as Decker) is treated like a partnership. Murphy v. Redland (1978), 178 Mont. 296, 583 P.2d 1049.

In light of the above discussion, this Court is essentially being asked to interpret Rule 17(b) of the Montana Rules of Civil Procedure. Edison argues we must strictly interpret this rule. In other words, that in the absence of express statutory authorization, no person has the capacity to file a lawsuit in Montana. And, Edison argues, there is simply no statutory provision granting a partnership (or joint venture) the capacity to sue in its own name in Montana courts.

Decker, on the other hand, argues Rule 17(b) should be interpreted liberally. Decker argues Rule 17(b) does not say that no person has capacity to sue unless and until there is a statute passed that expressly grants such capacity. The rule merely says that in determining whether someone has the capacity to sue, this Court should look at the statutes of Montana. There is no statute in Montana that expressly denies partnerships the capacity to sue, just as there is no statute expressly granting the capacity to sue. Therefore, Decker argues, this Court must determine on the basis of existing statutes whether the Montana Legislature intended that partnerships be treated as separate entities distinct from their partners. If so, then Decker should have the capacity to sue. We agree with Decker’s interpretation of Rule 17(b).

First, Decker directs this Court’s attention to the Uniform Partnership Act (UPA), adopted by Montana in 1947, Section 35-10-101 et. seq., MCA. Although Decker submits the UPA does not expressly deal with the question of a partnership’s capacity to sue, Decker argues the UPA does show the modern tendency to treat a partnership as a legal entity distinct from and independent of the individuals composing it. For example, under Section 35-10-301, MCA, a partnership may own property in its own name. Also, under Section 35-10-301(3)(e), MCA, a partnership may own a “claim” against third persons. The Minnesota Supreme Court, in Gleason v. Sing (Minn. 1941), 297 N.W. 720, described the changes brought about by the UPA:

“While a copartnership at common law was not considered a distinct entity from the partners composing it, the modern tendency is the other way, i.e., to treat a partnership as an entity distinct from and independent of the individuals composing it. 20 R.C.L. p. 804, Section 6, and cases under Note 16. That notion has grown in popularity and has been confirmed in many situations so as to be recognized as ‘the oneness of any somewhat permanently combined group without the aid of law.’ ID. p. 805. The uniform partnership act, 2 Mason Minn. St. 1927, Section7384-7428, has wrought decided changes in the common law conception of such organizations, as was pointed out in Windom Nat. Bank v. Klein, 191 Minn. 447, 254 N.W. 602. There is a tendency to treat a partnership as an entity under our bankruptcy act. Cf. Loomis v. Wallbom, 94 Minn. 392, 396, 102 N.W. 1114, 69 L.R.A. 771, 3 Ann.Cas. 798; Angell v. White Eagle O. & R. Co, 169 Minn. 183, 210 N.W. 1004, 20 Harv.L.Rev. 589. It is so generally treated in the business world, and no good reason is apparent why the law should not conform to business custom and usage. 22 Harv.L.Rev. 393; 24 Id. 603; 28 Id. 762; 29 Id. 158, 291, 838; 8 Columbia L.Rev. 391; 13 Id. 143.”

297 N.W. at 722.

We agree with Decker that from the language of the UPA and Gleason it is clear that a partnership is indeed a legal entity distinct from its partners. Therefore, a partnership has the capacity to sue in its own name.

Decker goes on to list some examples of other Montana statutes which show an intent by the Montana Legislature to treat the partnership as a distinct entity for the purposes of litigation. For instance, under Section 25-5-104, MCA, a partnership may be sued in its own name. Also, Section 25-35-505, MCA, provides that a partnership may sue in small claims court in its own name.

In light of the above discussion, this Court has little choice but to follow the clear intent of the Montana Legislature to treat partnerships as distinct entities with power to sue. It would be illogical and unfair to conclude that a partnership may own a claim but cannot enforce it; may own property but cannot protect it; may be sued but cannot sue; may sue in small claims court but not in Federal Court. The Montana Legislature should not be deemed to have acted so capriciously.

It is undoubtedly true, as Edison suggests, that the Montana Legislature could have enacted a statute permitting partnerships to sue in their own names. Conversely, it could have enacted a statute prohibiting a partnership from suing in its own name. The fact is that it did neither. In the absence of express guidance from the Legislature this Court must follow what we submit is the clear intent of the Legislature to treat partnerships as distinct entities with power to sue.

We find that under Montana law Decker has the capacity to maintain a suit against Edison in its own name and consequently we answer the certified question presented by the Ninth Circuit in the affirmative.

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


source: Caselaw Access Project

author: MR. JUSTICE HUNT

license: Public Domain

text:
    MARK J. PENLAND, Plaintiff and Appellant, v. J. LEONARD DERBY and Mary D. Derby, his wife, Defendants and Respondents.
    No. 85-337.
    Submitted Jan. 23, 1986.
    Decided Feb. 20, 1986
    714 P.2d 158.
    Datsopoulos, MacDonald & Lind, Ronald B. MacDonald argued,. Missoula, for plaintiff and appellant.

      Murphy, Robinson, Heckathorn & Phillips, David J. Dietrich argued, Kalispell, for defendants and respondents.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

The appellant, Penland, appeals the summary judgment granted by the Flathead County District Court, which allows respondents, Derbys to keep and use a summer cabin which lies across the legal boundary of their property, encroaching upon the appellant’s property. Penland contends that there were insufficient facts in the record to support the District Court’s finding of an equitable easement in the Derbys. We agree, and therefore need not discuss the other issues raised on appeal.

We reverse and remand for trial.

The issue before us is whether summary judgment was appropriate given the factual record and the legal and equitable theories argued to the District Court.

First we turn to the facts, as stipulated by the parties. Penland and the Derbys own adjacent property along Flathead Lake. Each of these properties include 63.6 feet of lake frontage. When Penland purchased his property in 1977, the seller and her real estate agent notified him of the existence of the boundary dispute between the seller and the Derbys. Penland was given notice that a summer cabin, owned by the Derbys, straddled the legal boundary between his and the Derbys’ property, protruding approximately 15 feet onto his property. This cabin has been in existence at the same location at least since 1934.

Surveys done in 1976 first indicated the encroachment of the summer home onto the appellant’s property. The Certificates of Surveys, No. 2389 and No. 1881, establish the legal boundary between their properties and accurately depict the location of the cabin. Each party respectively paid the real estate taxes on the real property depicted as “Plaintiff’s” property and “Defendant’s” property on the certificates of survey.

Settlement negotiations between the parties failed and Penland filed a complaint in District Court seeking declaratory judgment regarding the common boundary line and requesting the court to quiet title to the property and order the encroaching cabin removed. The parties submitted the matter on cross petitions for summary judgment, filing with the court stipulations of fact, stipulations of evidence, affidavits and briefs in support of their motions. In ruling on the cross motions, the District Court ordered that the respondents “have an equitable easement to keep the building upon the land on which it was constructed.”

Penland cites this Court’s admonishment, “A court, however, may not create as a matter of law an implied easement where the facts indicate the parties did not intend that an easement be created.” White v. Landerdahl (Mont. 1981), 625 P.2d 1145, 1147, 38 St.Rep. 412, 415. He argues that neither he nor the respondents purchased their property with the intent that an encroachment should continue by virtue of an implied easement and that their negotiations failed because they did not agree to either an easement or removal of the encroaching building.

The Derbys reject Penland’s contention that they relied on an implied easement theory. Rather they argue the basis of the District Court’s order was the “relative hardship doctrine” which requires the court to balance the competing interests of the parties. The Derbys emphasize that Penland was aware of the encroachment when he purchased the land and therefore is estopped from opposing Derbys’ claims to an easement in equity. They argue that Pen-land has “unclean hands” because of this knowledge, while respondents inherited the property without knowledge of the encroachment. Respondents rely on Allman v. Stuart (1972), 158 Mont. 402, 492 P.2d 909, to argue that appellant willfully ignored their alleged ownership rights. The Derbys acknowledge that this Court has yet to adopt an equitable “relative hardship doctrine” but argue for its adoption in this case.

It is unclear upon what theory the District Court based its finding of the existence of an equitable easement. While the District Court was not limited to the relative hardship doctrine, the other common equitable theories for the creation of easements are unlikely, given these facts. The record indicates no subservience of one part of the tenement to a dominant portion prior to severance. Michaelson v. Wardell (1980), 186 Mont. 278, 607 P.2d 100. Nor do the facts indicate reservation of an easement at the time Penland, or his predecessors, purchased the property. Burlingame v. Marjerrison (Mont. 1983), [204 Mont. 464,] 665 P.2d 1136, 1139, 40 St.Rep. 1005. Further, no facts in the record establish an agreement between the parties to create an easement. Johnson v. Meiers (1946), 118 Mont. 258, 164 P.2d 1012. There is no factual basis for an easement by necessity. Schmid v. McDowell (1982), 199 Mont. 233, 649 P.2d 431. Nor does the record indicate any misrepresentation of fact by Penland estopping him from protesting an easement in equity. Allman v. Stuart (1972), 158 Mont. 402, 405, 492 P.2d 909, 912.

The Derbys’ reliance upon Allman is unfortunate, as that case actually bolsters Penland’s argument. In Allman, the party with “unclean” hands ignored the right of the legal owner of the land underneath his building to request he remove his building. That case is factually distinguishable, however, in that the building’s owner bought the building with full knowledge that someone else owned the land. The Derbys argue Penland bought the land with notice of their “alleged” property right. Actually, the record indicates Pen-land bought his property with notice that although the cabin extended across the boundary, the surveys placed his legal boundary just where the parties have since stipulated it exists.

Because there are no facts in the record to support any established equitable easement theory we turn to the novel theory propounded by the Derbys, the doctrine of “relative hardship.” If the District Court’s order rests on that doctrine, this Court must remand the case for trial. If we affirmed the District Court’s judgment on a relative hardship theory the Court would be adopting a new theory of equitable easements, not requiring intent of the parties as an element. Considering a new legal theory on appeal from summary judgment is inappropriate, as a federal district court has explained:

“Summary judgment, with ever-lurking issues of fact, is always a treacherous shortcut and, in cases like these, too fragile a foundation for so heavy a load. Such relief is always discretionary, and in cases posing complex issues of fact and unsettled questions of law, sound judicial administration dictates that the court withhold judgment until the whole factual structure stands upon a solid foundation of a plenary trial where the proof can be fully developed, questions answered, issues clearly focused and facts definitively found.”

Petition of Bloomfield S.S. Co. (D.C.N.Y. 1969), 298 F.Supp. 1239, 1242, aff’d on other grounds (2d Cir. 1970), 442 F.2d 728.

The record discloses no set of facts supporting an equitable easement based on any previously accepted theory in Montana. Furthermore it would be unwise to consider a novel theory of equitable easements without the benefit of a complete record developed at trial. Therefore, we reverse and remand for trial.

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


author: MR. JUSTICE WEBER

text:
    In re the MARRIAGE OF WAYNE T. SNYDER, Petitioner and Respondent and LENA R. SNYDER, Respondent and Appellant.
    No. 85-341.
    Submitted on Briefs Dec. 18, 1985.
    Decided Feb. 20, 1986.
    714 P.2d 556.

      Berger Law Firm, Chris J. Nelson, Billings, for respondent and appellant.
    McKinley Anderson, Bozeman, for petitioner and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

The wife appeals from the property distribution in this dissolution of marriage. We affirm the order of the Gallatin County District Court.

The issues presented on appeal are:

1. Did the District Court erroneously fail to include a promissory note valued at $78,121 as part of the marital estate?

2. Should the District Court have awarded the wife either a one-half interest in the family home or its equivalent in cash?

The parties married late in life. Their marriage was dissolved six years later, in 1984, when the husband was sixty-nine years of age and the wife was sixty. Both parties worked during at least part of the marriage. The wife testified that she had entered into the marriage with the understanding that the husband would provide for her financially.

The husband brought to the marriage property worth over $161,000, including an interest in a family farm, $15,000 in retirement benefits, and a $55,000 home. While the parties were married, they sold his home and applied the proceeds to the purchase of a home which they held as joint tenants (“the marital home”). Also during the marriage, the interest in the family farm, which husband and his brother owned, was reduced to a promissory note from the brother in favor of husband and wife as tenants in common. The wife brought to the marriage miscellaneous furniture and appliances of unknown value. The parties acquired additional assets with a net value of $27,831 during their marriage.

In its distribution of property, the District Court ordered that the marital home, valued at $105,000, be sold. The wife was to receive $20,000 of the proceeds after payment of the mortgage, and the husband was to receive the remaining proceeds. The court also awarded the husband the promissory note representing the interest in the family farm. The balance payable on the note was $78,121 at the time of trial. The total value of the property distributed to husband was $154,184. He was also assigned $43,855 in liabilities, which included the mortgage on the marital home. The wife was awarded property with a total value of $31,800 and assigned liabilities totaling $6,438. The trial court further awarded the wife $100 per month in maintenance, to continue until she dies or remarries.

I

Did the District Court erroneously fail to include a promissory note valued at $78,121 as part of the marital estate?

The wife acknowledges that husband’s interest in the family farm existed before the parties married. However, she argues that because the promissory note representing that interest names her as a tenant in common, it establishes an irrevocable gift from husband to her, and she should receive half of the note’s value.

Section 40-4-202, MCA, governs division of property in a dissolution of marriage. That statute, in relevant part, provides that:

“. . . the court . . . shall . . . finally equitably apportion between the parties the property and assets belonging to either or both, however and whenever acquired and whether the title thereto is in the name of the husband or wife or both.”

Subsection (3) of that statute further provides that:

“Each spouse is considered to have a common ownership in marital property that vests immediately preceding the entry of the decree of dissolution . . .”

The question of title is not controlling under this statute. Morse v. Morse (1977), 174 Mont. 541, 545, 571 P.2d 1147, 1149. In Morse, we upheld a property division in which the District Court did not give controlling weight to the fact that the wife quitclaimed certain property to the husband during the marriage. In a similar manner, we conclude that the District Court here was not required to give controlling weight to the tenancy in common form of ownership in its distribution of the promissory note.

Section 40-4-202, MCA, further provides, in Subsection (1) that:

“. . . In dividing property acquired prior to the marriage . . . the court shall consider those contributions of the other spouse to the marriage, including: (a) the nonmonetary contribution of a homemaker; (b) the extent to which such contributions have facilitated the maintenance of this property; and (c) whether or not the property division serves as an alternative to maintenance arrangements.”

Under this standard, prior acquired property may properly be included as part of the marital assets where, for example, contributions of the other spouse have facilitated maintenance of the property. See In re Marriage of Jorgensen (1978), 180 Mont. 294, 590 P.2d 606. In the present case, the interest in the family farm was undisputedly property of the husband prior to this marriage. In evaluating the facts of the present case under the above statutory standard, we note that the District Court found that both parties contributed to make the household operate satisfactorily during their marriage. There is nothing in the record or in the briefs submitted to us to support the notion that the wife’s contributions facilitated the maintenance of the interest in the farm property at any time. The wife was awarded maintenance in addition to the property division in this matter.

We have repeatedly stated that we will not alter the judgment of a district court in resolving a property distribution unless a clear abuse of discretion is shown. In this case, the findings of the District Court set out with particularity the assets which the husband and wife brought into their marriage. The order also set out the assets acquired and liabilities incurred during the marriage, which it labeled the “marital net estate.” The court then provided for disposition of the property acquired both prior to and during the marriage. Under the above statutory standards, we cannot say that the District Court abused its discretion in excluding the promissory note for the farm from the “marital net estate,” or in awarding it to the husband.

II

Should the District Court have awarded the wife either a one-half interest in the family home or its equivalent in cash?

The wife raises this issue on essentially the same grounds as her argument under the first issue. She claims that the husband gifted her with a one-half interest in the marital home, and argues that the fact that the home is owned jointly by the parties is evidence of the gift. She contends that she should therefore be awarded one-half of the home’s value.

As we have pointed out, Montana’s statutory scheme for disposition of marital property does not give controlling importance to the way in which title to the property is held. Rather, the district court is to make an equitable division of the property, considering the factors set out in Section 40-4-202, MCA. The requirement that the property division be equitable does not mandate that the division be equal. Snell v. Snell (Mont. 1983), [205 Mont. 359,] 668 P.2d 238, 240, 40 St.Rep. 1359, 1361.

We have reviewed the facts in the record, including the relatively short duration of the parties’ marriage and the fact that $55,000 toward the price of the marital home was contributed from husband’s pre-marriage assets. The District Court’s disposition of the marital home will allocate to the husband approximately $51,000 from the sale of the home — the $105,000 value less the $34,000 mortgage and the $20,000 to be distributed to the wife. We find no abuse of discretion in the way in which the District Court distributed the value of the marital home.

The judgment of the District Court is affirmed.

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


author: MR. CHIEF JUSTICE TURNAGE

text:
    In re the MARRIAGE OF LOIS MARIE KRAUT, Petitioner and Appellant, and MAURICE RAYMOND KRAUT, Respondent and Respondent.
    No. 85-420.
    Submitted on Briefs Dec. 5, 1985.
    Decided Feb. 20, 1986.
    714 P.2d 167.
    Harrison, Yeshe & Thweatt, Harold H. Harrison, Helena, for petitioner and appellant.

      Smith Law Firm, Rebecca Smith, Helena, for respondent and respondent.
   MR. CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

This divorce case is before the Court for the second time. The first time the case was here, we affirmed the District Court’s denial of wife’s Rule 60(b), M.R.Civ.P., motion to vacate a dissolution of marriage order. In Re the Marriage of Kraut (1985), [215 Mont. 170,] 696 P.2d 981, 42 St.Rep. 268. We held that the judgment dissolving the marriage was not void and therefore could not be vacated pursuant to Rule 60(b). Kraut, 696 P.2d at 983. We suggested, however, that the dissolution order itself could be reviewed by this Court only after Rule 54(b), M.R.Civ.P., certification. Kraut, 696 P.2d at 983. Wife obtained Rule 54(b) certification of the dissolution order from the District Court and now appeals.

The issue on appeal is whether or not an order of dissolution rendered without hearing should be set aside. Because the underlying dispute here concerns the effective date of dissolution for purposes of determining marital property, we will also consider whether or not the dissolution order was effective when issued prior to its Rule 54(b), certification.

Wife filed a petition for dissolution of marriage in November 1978. Husband immediately filed a response and counter-petition. Each party alleged in their petitions and stipulated in the January 21, 1980, pretrial order that the marriage was irretrievably broken. Husband moved for summary judgment of dissolution. On January 26, 1981, the District Court found the marriage irretrievably broken, based on the pleadings, and granted summary judgment on the dissolution issue. The issues of maintenance, custody, support, attorney fees and costs were reserved and remain undecided now.

Wife moved to vacate the 1981 summary judgment on April 5, 1984. This motion was denied by the District Court and we affirmed the denial in Kraut, supra. On June 28, 1985, wife obtained Rule 54(b) certification of the dissolution order and now appeals the issuance of that order to this Court.

In the interim, on July 2, 1984, wife remarried.

The last time we considered this dissolution order we determined that the order was premature because there was no hearing on whether or not the marriage was irretrievably broken as required by Section 40-4-107, MCA. Kraut, supra. We further held that the premature judgment was voidable rather than void. Wife now argues that the voidable judgment must be set aside because it was premature. The argument is circular and unpersuasive.

A similar issue was before this Court in Interstate Counseling Service v. Emeline (1964), 144 Mont. 409, 396 P.2d 727. In that case, a default judgment had been entered without an affidavit of amount due even though the affidavit was required by Rule 55(b), M.R.Civ.P. The appellant moved to set aside the judgment on the sole ground that the affidavit had been omitted. We held that the judgment was voidable, but that we required additional reason to set the judgment aside. Our refusal to set the judgment aside was the result of our application of Rule 61, M.R.Civ.P. We will now apply Rule 61, M.R.Civ.P., to the facts of this instant case.

Rule 61, M.R.Civ.P., requires us to “disregard any error or defect in the proceedings which does not affect the substantial rights of the parties.” Wife here has not shown us where she has been denied substantial rights. In fact, she has provided us with no more reasons to set aside the judgment than that the judgment was premature.

Wife points to several opinions by this Court where we have set aside judgments upon a showing that they were prematurely entered. See Sowerwine v. Sowerwine (1965), 145 Mont. 81, 399 P.2d 233; Paramount Publix Corporation v. Boucher (1933), 93 Mont. 340, 19 P.2d 223; and Taylor v. Southwick (1927), 78 Mont. 329, 253 P. 889. Each of these cases involve default judgments where the judgment was entered either before the allotted time to answer or amend had passed or in spite of the fact that the complaint had been answered properly. The judgments were thus entered prematurely, and we required no additional reason to set them aside. However, in each of these cases the showing that the judgments were entered prematurely also showed that a party was denied the right to assert its case to the court through pleadings. That denial of rights was sufficient reason to set aside the voidable judgments in accordance with Rule 61, M.R.Civ.P., and our holding in Interstate Counseling, supra.

The instant case is different. The wife has not been denied her right to plead or have her pleadings heard. Indeed, the summary judgment was in accordance with her pleadings. We now hold that the fact that a summary judgment of dissolution was premature for want of hearing is insufficient reason to set aside the judgment in this case. Because wife has offered us no more reason than that here, the judgment stands.

There is another issue lurking in appellant’s briefs that we must consider in order that the District Court can determine marital property in the collateral proceedings. Wife argues that the dissolution order was not effective until the final entry of judgment pursuant to Rule 54(b), M.R.Civ.P. If we agreed, the date of dissolution would be June 28, 1985, when the dissolution order was certified, instead of January 26, 1981, when the order was originally entered. However, we do not agree.

Wife points to the language of Section 40-4-108, MCA, and the Commissioner’s Comment to this statute.

Section 40-4-108, MCA, states:

“A decree of dissolution of marriage or of legal separation is final when entered, subject to the right of appeal. An appeal from the decree of dissolution that does not challenge the finding that the marriage is irretrievably broken does not delay the finality of the provision of the decree which dissolves the marriage beyond the time for appealing from the provision, and either of the parties may remarry pending appeal.”

The Commissioner’s Comment to the foregoing section states:

“Subsection (a)(1) abolishes interlocutory periods in those states which have them. The decree of dissolution or separation will be effective when entered, subject to the right of appeal. The second sentence of subsection (a)(1) is intended to authorize an appeal from a decree of dissolution which does not challenge the decree insofar as it is based on a finding that the marriage is irretrievably broken. In such cases, either party is free to remarry as soon as the time for taking appeal has expired, despite the fact that an appeal which does not challenge the dissolution may be pending.” [Emphasis added.]

Wife then argues that according to Kraut, supra, the dissolution and judgment was not subject to appeal until after certification under Rule 54(b), and that the judgment was therefore ineffective until its certification. We note that this interpretation would render wife a bigamist, because she remarried before she certified the decree.

However, wife’s interpretation is incorrect. In Kraut we only held that we could not hear the appeal until the order was certified pursuant to Rule 54(b). By Section 40-4-108, MCA, the order was subject to appeal as soon as it was originally entered. The fact that we would not hear the appeal until the order was certified does not mean the order was not subject to appeal.

We interpret the above language from Section 40-4-108, MCA, and its commentary to delay the effectiveness of decrees of dissolution only for appeals that challenge the finding that the marriage is irretrievably broken. The finding by the District Court that the marriage was irretrievably broken has never been challenged in this case. Only the procedure has been challenged on this appeal. Therefore, by the language of Section 40-4-108, MCA, and the Commissioner’s Comment to the section, the decree of dissolution was effective on January 26, 1981, when it was originally entered.

The District Court is now directed to continue the divorce proceedings in accordance with this opinion.

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


text:
    HAROLDEEN WITTY, Plaintiff and Respondent, v. HARRELL W. PLUID, JR., and Lyle Pluid, Defendants and Appellants.
    No. 85-431.
    Submitted on Briefs Dec. 18, 1985.
    Decided Feb. 20, 1986.
    714 P.2d 169.
    Murphy, Robinson, Heckathorn & Phillips, I. James Heckathorn, Kalispell, for defendants and appellants.
    Measure, Ogle & Ellingson, Jeffrey D. Ellingson, Kalispell, for plaintiff and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Appellants appeal from the judgment of the Lincoln County District Court ordering appellants to pay respondent’s expert witness fees.

We reverse.

The sole issue on appeal is whether the order of the District Court directing appellants to pay respondent’s expert witness fees is proper.

Respondent brought an action in the District Court and, after a jury trial, prevailed on the merits. Respondent then submitted to the trial court her memorandum of costs and disbursements.

The appellants objected, moved to strike the cost bill as frivolous, moved the court to tax costs in accordance with Section 25-10-502, MCA, and impose sanctions pursuant to Rule 11, M.R.Civ.P. Following submission of briefs and a hearing, the trial court issued its order allowing respondent her costs for expert witnesses. The court awarded costs for four expert witnesses in the amount of $1,000, $1,700, $500, and $410. This appeal followed.

We have addressed this issue before in Swenson v. Buffalo Building Co. (Mont. 1981), 635 P.2d 978, 38 St.Rep. 1588. In Buffalo, the appellant appealed the trial court’s allowance of $1,500 for expert witness fees. We stated:

“A verified memorandum of costs and disbursements is prima facie evidence that the items were necessarily expended and are properly taxable, unless, as a matter of law, they appear otherwise on the face. The burden of overcoming this prima facie case rests upon the adverse party.”

635 P.2d at 985. In the instant case, respondent’s costs for expert witnesses are not properly taxable as a matter of law.

Witness fees are controlled by statute. Section 26-2-501, MCA, states:

“Witnesses in courts of record and before certain court officers. (1) Witness fees are as follows:
“(a) for attending in any civil or criminal action or proceeding before any court of record, referee, or officer authorized to take depositions or commissioners to assess damages or otherwise, for each day, $10; . . .”

Section 26-2-505 states:

“Expert witnesses. An expert is a witness and receives the same compensation as a witness.”

The respondent argues that Section 25-10-201, MCA, gives a district court the discretion to award costs for expert witnesses. That section states:

“Costs generally allowable. A party to whom costs are awarded in an action is entitled to include in his bill of costs his necessary disbursements, as follows:
. . (9) such other reasonable and necessary expenses as are taxable according to the course and practice of the court or by express provision of law.”

Where there are two statutes concerning the same subject, the particular controls the general. Section 1-3-225, MCA. See also State Consumer Counsel v. Department of Public Service Regulation (1979), 181 Mont. 225, 593 P.2d 34.

In this case, we have a statute specifically limiting expert witness fees to $10 per day. This statute controls the general statute authorizing a district court to award costs in accordance with the course and practice of the court.

Of course, a party can pay an expert witness any fee he or she chooses, but a district court cannot award costs in excess of $10 per day per witness.

Therefore, we hold that the trial court abused its discretion in ordering appellants to pay the costs of respondent’s expert witnesses in excess of $10 per day per witness. This matter is remanded to the District Court with instructions to enter judgment in accordance with this opinion.

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


author: MR. JUSTICE MORRISON

text:
    STATE OF MONTANA, ex rel., DEPARTMENT OF HEALTH AND ENVIRONMENTAL SCIENCE, Plaintiff and Respondent, v. CECIL L. BERNHARD, Defendant and Appellant.
    No. 85-513.
    Submitted on Briefs Jan. 23, 1986.
    Decided Feb. 20, 1986.
    714 P.2d 558.

      Jeffrey L. Shrom, Missoula, for defendant and appellant.
    William Douglas, Lincoln Co. Atty., Susan Loehn, Deputy Co. Atty., Libby, for plaintiff and respondent.
   MR. JUSTICE MORRISON

delivered the Opinion of the Court.

Cecil Bernhard appeals the August 16, 1985, order of the Nineteenth Judicial District Court, County of Lincoln, which assessed a $50 per day civil penalty against him for failing to properly shield his motor vehicle wrecking facility from public view. The order also stated that if the penalty was not paid by the 13th of September, 1985, the Department of Environmental Health and Sciences (DHES) would be permitted to contract for the destruction of the vehicles. Defendant Bernhard appeals. We affirm the order of the District Court.

Cecil Bernhard stores between 60 and 100 junk vehicles on his property near Eureka, Montana. In November of 1975, a complaint was filed against Bernhard for operating a motor vehicle wrecking facility without a license, a misdemeanor. He was ultimately fined $300 and sentenced to serve 30 days in jail unless he obtained a license within 30 days of the date of judgment. On appeal, this Court affirmed the conviction. 173 Mont. 464, 568 P.2d 136.

Bernhard was next civilly charged July 2, 1979, with operating a motor vehicle wrecking facility without a license, pursuant to Section 75-10-511(1), MCA. An order was issued by the Lincoln County District Court, enjoining defendant from operating the facility without a license and ordering him to shield the vehicles from public view. The order also provided for the imposition of a $50 a day fine for each day Bernhard refused to comply. On appeal, this Court again affirmed the District Court. [208 Mont. 53,] 675 P.2d 390.

As a result of that action, Bernhard placed a fence around most of the vehicles and obtained a license to operate the facility. The fence was installed during the winter of 1984-85. The frozen ground made it impossible to drive fence posts into the ground. Cattle belonging to a neighbor, but grazing on Bernhard’s land, apparently knocked the fence down in the spring of 1985. The owner of the cattle rebuilt the fence. However, a strong wind storm again knocked down the fence.

Upon being notified of the problem, Lincoln County’s sanitarian viewed Bernhard’s property and sent him a letter May 13, 1985, requesting a compliance timetable. The fence was not improved and on July 2, 1985, the County Attorney filed a petition and motion to show cause why the civil penalty of $50 per each day of violation should not be imposed. A hearing was set for August 12, 1985. Defendant appeared, but without an attorney. After extensive questioning by the trial judge regarding defendant’s right to counsel, the hearing proceeded with defendant acting pro se.

Following the hearing, the trial judge issued findings of fact, conclusions of law and the order assessing defendant $50 a day from June 25, 1985, to August 12, 1985, and further assessing defendant $50 a day thereafter until full compliance with the order to shield the vehicles. Bernhard filed a motion September 13, 1985, for a temporary restraining order forbidding the DHES from contracting for the destruction of the vehicles; however, he failed to request that a hearing be set on the motion. The present status of the vehicles is unknown.

Bernhard, now represented by counsel, appeals, raising the following issues:

1. Whether the defendant was in compliance with the court’s order as a matter of law and whether the District Court erred in its judgment of noncompliance?

2. Once a motor vehicle wrecking facility license is issued, does the court have to follow a procedure for issuing, denying or revoking the license before imposing a $50 a day civil penalty for failure to shield?

3. Was the defendant entitled to be represented by counsel at the show-cause hearing?

4. Did defendant willingly and knowingly waive his right to counsel at the show-cause hearing?

5. Was the defendant incompetent to represent himself at the show-cause hearing?

I.

Bernhard argues that he erected a fence to shield the facility pursuant to Section 75-10-504, MCA, and a November 1984 order of the District Court. The fence was destroyed by cattle and a wind storm, forces over which Bernhard had no control. Therefore, pursuant to Section 1-3-217, MCA, he cannot be held responsible for the destruction of his fence. What Bernhard fails to mention is that he is responsible for installing a fence which adequately shields the wrecking facility and for repairing or replacing that fence when necessary. There is substantial credible evidence in the record to support the trial judge’s finding that Bernhard was not in compliance with the court’s earlier order to shield the wrecking facility,

II.

The trial judge did not have to revoke Bernhard’s license prior to imposing $50 a day civil penalty.

Section 75-10-542(2), MCA, provides:

“A person who violates this part, except 75-10-520, a rule of the department, or an order issued as provided in this part shall be subject to a civil penalty of not more than $50. Each day upon which a violation of this part or a rule or order occurs is a separate violation.”

Section 75-10-504, MCA, provides that a motor vehicle wrecking facility “established or proposed on or after July 1, 1973,” must be shielded from public view. By failing to shield his facility, Bernhard violated that statute. Bernhard also violated a court order issued pursuant to Title 75, Part 10. Therefore, pursuant to Section 75-10-542(2), MCA, the $50 a day penalty was properly imposed.

III.

The remaining three issues concern Bernhard’s lack of representation by counsel at the show-cause hearing.

Section 37-61-416, MCA, states in applicable part:

“Party may appear in person or by attorney. A party to a civil action who is of full age may prosecute or defend the same in person or by attorney at this election unless he has been judicially declared to be incompetent to manage his affairs.”

Bernhard was entitled to be represented by counsel at the show-cause hearing. However, after extensive questioning by the trial judge with respect to whether Bernhard wished to have counsel present, the trial judge decided to proceed with the hearing. We find no error. Bernhard was told he had a right to counsel. He was warned of the potential impact of the show-cause hearing on his financial well-being. Nevertheless, Bernhard stated that he would be willing to tell “his side of the story” to the court. Therefore, defendant elected not to be represented by counsel at the hearing.

Finally, Bernhard presents no evidence that he has been judicially declared incompetent. Further, he has known for at least eleven years that he must license and shield his wrecking facility. Therefore, he knew and understood the charges against him. His testimony at the hearing was competent. He was competent to represent himself at the hearing.

Affirmed.

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


author: MR. JUSTICE HARRISON

text:
    STATE OF MONTANA, Plaintiff and Appellant, v. T.W. Defendant and Respondent.
    No. 85-262.
    Submitted Jan. 16, 1986.
    Decided Feb. 25, 1986.
    715 P.2d 428.

      Mike Greely, Atty. Gen., Kimberly A. Kradolfer argued, Asst. Atty. Gen., Sherry Petrovich Stadler argued, Legal Intern for Atty. Gen., Helena, Harold Hanser, Co. Atty., Billings, Teresa McCann O’Connor argued, Deputy Co. Atty., for plaintiff and appellant.
    John Adams argued, Billings, for defendant and respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

This is an interlocutory appeal filed by the State of Montana after the District Court granted defendant’s motion in limine precluding the State from using in any way defendant’s Youth Court records and from offering or attempting to offer any evidence of alleged prior offenses which occurred while the defendant was a minor. We reverse and remand for trial consistent with the holding in this opinion.

The defendant, T.W., is charged with incest, pursuant to Section 45-5-507, MCA. This offense was committed April 2, 1984, against his fifteen year old sister who is developmentally disabled and functions at an IQ level of about 81.

Prior to this incident, the victim had been placed in various foster homes because her mother was having mental problems. She spent weekends in her mother’s home. During one of these weekend visits, T.W. took her into her mother’s bedroom, pushed her face down on the bed with his hand over her mouth so she could not scream and pressed his erect penis against her buttocks to stimulate himself. When their mother discovered them, the victim was crying.

This incident was reported to the Department of Social and Rehabilitation Services (SRS) but no charges were filed. The matter was disposed of informally, rather than being adjudicated in Youth Court. The victim’s foster care was continued. T.W. was given the opportunity to join the Army and did so in March, 1981. The victim then returned home pursuant to court order.

When T.W.’s tour of duty ended in March, 1984, he returned to Montana, to live with an aunt. He visited his mother April 2 when he again molested the victim after following her into her bedroom. He fondled the victim’s breasts and pushed his hands into her pants. He told her not to tell anyone. She reported the incident to school personnel who reported to SRS and law enforcement personnel. T.W. denies the offense and has offered to join the Navy.

Defense counsel filed its motion in limine to preclude the State from using evidence of any incidents prior to the one at issue. The State filed a notice of intent to rely on evidence of other crimes pursuant to Rule 404(b) M.R.Evid. Defendant’s motion in limine was granted.

The issues presented for appeal are:

(1) Whether the Youth Court Act prohibits the introduction of acts committed by the defendant when he was a juvenile.

(2) Whether the past act is admissible as other crimes evidence under Rule 404(b), M.R.Evid., and State v. Just (1979), 184 Mont. 262, 602 P.2d 957. The Montana Youth Court Act does not prevent the mother from testifying. The testimony at issue here concerns defendant’s mother relating what she observed of defendant on other occasions. The State does not seek to use any statements made by a participant during a juvenile proceeding. The applicable statute is Section 41-5-402, MCA, which provides:

“An incriminating statement relating to any act or omission constituting delinquency or need of supervision made by the participant to the person giving counsel or advice in the discussions or conferences incident thereto may not be used against the declarant in any proceeding under this chapter, nor may the incriminating statement be admissible in any criminal proceeding against the declarant.” Since no statement of a “participant” is here involved, the testimony given by the mother of the defendant is not privileged under Section 41-5-402, MCA.

This Court recognizes that:

“Generally, evidence of other offenses or of other similar acts at other times is inadmissible for the purpose of showing the commission of the particular criminal offense charged. [Citations omitted.] The reason is that the defendant is entitled to be informed of the offense charged so that he need prepare his defense only to that particular offense. Proof of other offenses subjects him to surprise and to a defense of multiple collateral or unrelated issues. [Citations omitted.] This rule applies to evidence of other offenses regardless of whether defendant was actually charged with the other offense.”

[Citations omitted.]

Just, 184 Mont. at 267-68, 602 P.2d at 960.

There is an important exception to this general rule,

“which ... in this jurisdiction, is of ancient lineage. Simply put, the evidence of prior sexual acts by a defendant and a [victim] is admissible in a trial for a sexual offense [:]
“(1) When similar acts with the same prosecuting witness are involved;
“(2) When similar acts are not too remote in time; and
“(3) When evidence of other offenses tends to establish a common scheme, plan or system, where such other offenses are similar to, closely connected with and not too remote from the one charged, and where they are so that the proof of one tends to establish the other.” [Citations omitted.]

Just, 184 Mont. at 267-68, 602 P.2d at 960.

The rule and the exception is codified in Rule 404(b), M.R.Evid.:

“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.”

The Commission Comment to Rule 404(b), M.R.Evid, is clear. The commission intended “that there be no change in the admissibility of such evidence under existing Montana law.” In order to protect defendants in criminal cases, the potentially prejudicial evidence of other crimes or wrongful acts is weighed against its probative value by applying three factors identified in State v. Jensen (1969), 153 Mont. 233, 239, 455 P.2d 631, 634, and reiterated in Just, supra. The fourth element was added and applied in Just. These four elements have come to be known as the “Just test” or “Just formula” and must be applied before allowing evidence of a defendant’s prior sexual acts against the same victim.

The order of the District Court granting defendant’s motion in limine is bottomed on application of only one element of the Just test and the Youth Court Act. As noted above the Youth Court Act is not applicable in this case. While failure of questioned evidence to meet only one element of the Just test is not sufficient to refuse its admission, a decision to admit the evidence should not be made lightly. The four factors must be considered together.

The victim in this case had been molested by her brother four years prior to the incident which is the object of this action. The lower court found this length of time to be too remote, citing State v. Hansen (1980), 187 Mont. 91, 608 P.2d 1083, where the Court found two acts, two and one-half years apart, were too remote and therefore not admissible. However, the Court also concluded the sequence of evidence had no distinctive qualities that distinguished the acts from other rapes, nor did the crimes tend to establish a common scheme, plan or system. Hansen, 187 Mont. at 97, 607 P.2d at 1086-87. If none of the elements are met, the probative value of the evidence is not substantially outweighed by the prejudice to the defendant and the evidence can not be admitted. Hansen, 187 Mont. at 100, 608 P.2d at 1088. Hansen does not hold that failure to meet only one element of the Just formula deems the prejudicial effect on the defendant sufficient to refuse admission of prior acts.

The lower court in this case applied only the element of remoteness to the facts. “The objection that evidence is too remote is directed to the discretion of the court and is a matter that goes to the credibility of the evidence rather than to its admissibility.” State v. Satterfield (1943), 114 Mont. 122, 127, 132 P.2d 372, 373-74; State v. Nelson (1961), 139 Mont. 180, 186, 362 P.2d 224, 228; State v. Fitzpatrick (1980), 186 Mont. 187, 209, 606 P.2d 1343, 1355; State v. Doll (Mont. 1985), [214 Mont. 390,] 692 P.2d 473, 476, 42 St.Rep. 40, 44.

The determination of a trial judge that evidence is too remote to be relevant will not be reversed in the absence of clear proof of an abuse of that discretion. Nelson, 139 Mont. at 186, 362 P.2d at 228. In this instance the lower court’s determination that the previous incident was too remote to be admissible is error. Admission of evidence cannot be denied solely on the fact it was not near in time to the incident in question. Factors other than mere lapse of time must be determined by the circumstances of the case. Satterfield, 114 Mont. at 127, 132 P.2d at 373; Nelson, 139 Mont. at 186, 362 P.2d at 228; Fitzpatrick, 186 Mont. at 209, 606 P.2d at 1355; Doll, 629 P.2d at 476, 42 St.Rep. at 44.

The Wisconsin Supreme Court found when analyzing the probative value of a prior incident that remoteness in point of time “does not necessarily render evidence irrelevant. . . “ Sanford v. State (1977), [76 Wis.2d 72, 81,] 250 N.W.2d 348, 352. Place and circumstances also must be considered. The Wisconsin case involved the rape of a woman who was accosted by the suspect after she had exited a public bus. He asked her innocuous questions to get her attention, then approached her from behind, put what he said was a gun in her back, took her to a garage where he ordered her to remove her jacket and lie down on it, and committed an act of rape on her. In an incident occurring one and one-half years earlier, a person identified as the same defendant had followed this pattern of behavior almost exactly. The court allowed the evidence of the earlier incident to be admitted to show identity, because it was similar in character to the case being tried. However, the court also said evidence cannot be admitted,

“where the lapsed time is so great as to negative all rationale or logical connection between the facts sought to be proved and the remote evidence offered in proof thereof.”

Sanford, 76 Wis.2d at 82, 250 N.W.2d at 352.

We do not find in the case at bar that the evidence is so remote as to have no evidentiary value. While the actual length of time between the two incidents was four years, the opportunity for an encounter between T.W. and his sister did not reoccur during that four year period. If in fact the second alleged incident did occur, it occurred at the first opportunity, making the actual time period between the two incidents less significant. The reasoning of the Wisconsin Court is persuasive and we adopt it:

“. . . [A]ny issue as to remoteness of the prior incident is almost completely diffused by the fact that during the time gap between the prior incident and the rape, defendant was in confinement in a correctional institution.”

Sanford, 76 Wis.2d at 82, 250 N.W.2d at 352.

Because of the developmental disability of the victim, extraordinary care must be exercised in deciding whether or not to admit evidence of T.W.’s previous sexual conduct with her. The State cannot expect routine admissions of past acts anymore than the defendant can rely on their automatic exclusion for any reason other than the Just exceptions. While the Court is mindful that the exceptions can swallow the rule, particularly in a case such as this one, where the mental capacity of the witness is impaired, those exceptions must be adhered to scrupulously to assure fairness to both parties. In this case both acts were sexual in nature. The acts occurred in the victim’s bedroom or one she shared with her mother. The act in question occurred at the first opportunity after the previous act. These facts tend to establish a common scheme or plan. The evidence the State wishes to introduce is for the purpose of showing defendant’s motive, opportunity and intent — allowable exceptions under rule 404(b), M.R.Evid. Because the parties are the same and because of the similarities between the two acts and the circumstances surrounding the acts, the probative value of the evidence is not substantially outweighed by the prejudice to the defendant.

An issue of first impression raised by the Court and ordered briefed by counsel is whether the pre-trial order denying the States’s motion in limine is appealable within the scope of Section 46-20-103, MCA, pertinent parts of which are set forth below:

“(1) Except as otherwise specifically authorized, the state may not appeal in a criminal case.
“(2) The state may appeal from any court order or judgment the substantive effect of which results in;
“(e) suppressing evidence . . .”

Although the term suppression is not defined in the Montana Code Annotated or in Montana case law, “suppress” means “to effectively prevent from using.” Rogers v. United States (D.C. Cal. 1958), 158 F.Supp. 670, 680.

In the past this Court has accepted interlocutory appeals by the State when the ruling by the District Court had the substantive effect of suppressing evidence, and involving constitutional rights of the defendants. Nor were the cases limited to the precise situations set forth in Section 46-13-301, MCA, (motion to suppress confession of admission), or Section 46-13-302, MCA, (motion to suppress evidence illegally seized). See State v. Johnson (Mont. 1983), [207 Mont. 214,] 674 P.2d 1077, 40 St.Rep. 1990, cert. denied (1984), _ U.S __, 104 S.Ct. 2693, 81 L.Ed.2d 365, (voice identification of defendant was suppressed); State v. Jackson (1981), 195 Mont. 185, 637 P.2d 1, (evidence of defendant’s refusal to take a breath-test was suppressed); State v. Ulrich (1980), 187 Mont. 347, 609 P.2d 1218, (results of neutron activation test were suppressed).

In the case at bar, however, defendant’s constitutional rights are not at issue, and the question to be addressed is whether a broader interpretation of the statute is appropriate. The State argues without evidence of prior instances of contact between T.W. and his sister, its ability to prosecute the case will be severely impaired. The trial will be solely a question of credibility between the defendant and the victim. The Kansas and Illinois Supreme Courts have strongly rejected a narrow interpretation of similar statutory language which would limit interlocutory appeals by the State to situations in which evidence had been suppressed because it was obtained in violation of constitutional rights. See State v. Newman (1984), 235 Kan. 29, 680 P.2d 257, and People v. Young (1980), 82 Ill.2d 234, 412 N.E.2d 501. The Illinois Court in Young allows pretrial interlocutory appeals in criminal cases whenever the prosecutor certifies to the trial court that suppression substantially impairs the State’s ability to prosecute. At 247, 45 Ill.Dec. at 156, 412 N.E.2d at 507. The high court refused to formulate a standard by which lower courts could determine the appealability of a certain order, relying instead on the “good-faith evaluation by the prosecutor of the impact of the suppression order on his case.” Young, at 247, 45 Ill.Dec. at 156, 412 N.E.2d at 507.

There is an important distinction between interlocutory appeals on pre-trial rulings and those taken in the course of the trial. Mid-trial appeals place the defendant in double jeopardy in violation of the Fifth Amendment to the United States Constitution and Article II, Section 5 of the Montana State Constitution and are not appealable. State v. Carney (Mont. 1986), [219 Mont. 413,] 714 P.2d 532, 43 St.Rep. 54. No jeopardy attaches here, as the jury had not yet been sworn. Crist v. Bretz (1978), 437 U.S. 28, 98 S.Ct. 2156, 57 L.Ed.2d 24. Because there is no double jeopardy problem in this case the ruling is appealable.

We reverse the order of the District Court and remand with instructions to try the case on its merits consistent with this opinion.

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


text:
    In the Matter of Declaring M.L.H., H.M.H. and R.H., Youths in Need of Care.
    No. 85-276.
    Submitted on Briefs Nov. 21, 1985.
    Decided Feb. 25, 1986.
    715 P.2d 32.

      French, Mercer, Grainey & Duckworth, Edward K. Duckworth, Poison, for appellant.
    Mike Greely, Atty. Gen., Joe Roberts, Asst. Atty. Gen., Helena, John Frederick, Co. Atty., Larry Nistler, Deputy Co. Atty., Poison, for respondent.
    Matthew O’Neill, Christian, McCurdy & Wold, Poison, for amicus/ guardian ad litem.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Following an adjudicatory hearing the Twentieth Judicial District, Lake County District Court declared M.L.H., H.M.H. and R.H. youths in need of care. Their parents appeal the adjudicatory order and the dispositional order of the District Court placing the children in two separate foster homes.

We reverse and remand for proceedings consistent with this opinion.

The parents present these issues for review:

1. Whether the District Court committed reversible error in failing to make a record of an in-chambers interview of the children.

2. Whether the District Court’s findings of fact and conclusions of law are supported by sufficient evidence.

3. Whether the District Court erred by indicating at the adjudicatory hearing that it intended to transfer custody of the children from the parents to the Department of Social Rehabilitation and Services.

The children, through their guardian ad litem, present the following questions in their brief as amicus curiae:

1. Whether certain documentary evidence should be disregarded as inadmissible hearsay.

2. Whether the District Court erred in placing the three children in two separate foster homes.

The appellant parents are both disabled by illness. The father, a retired dairy farm worker, is 67 years old and suffers from emphysema. The mother is 46 years old and suffers from obesity, high blood pressure, diabetes, and an old back injury. Their sole support is from social security payments which total approximately $775 per month.

The appellants have six children. Three are concerned in this proceeding: M.L.H., a female, age 13; H.M.H., a female, age 12; and R.H., a male, age 11. The record contains little reference to the other three children. They are two females and a male in their late teens.

The appellants own a small house and an adjoining lot. This house has two bedrooms, a living room, a kitchen, and a bathroom. The six children share one bed room and also use the living room for sleeping as well.

The nature of the physical environment of the children may be set forth by a quote from a report of a social caseworker:

“On every visit social worker has made to the home, there have been clothes strewn all over the floors of every room. The clothes have to be stepped on when walking through the rooms. Junk is piled everywhere and leftover food sits out on the kitchen table and counter tops. Dirty dishes are everywhere. A foul smell is everywhere and permeates everything.”

The same report contains statements that set forth the nature of the parental attitude and ability to control the children:

“Children literally run the streets, engage in illegal behavior and get themselves involved in potentially physically and emotionally damaging situations.
“Neither parent is motivated to instill in their children the difference between right and wrong, respect for others and their rights, or to provide an adequate physical and emotional environment.”

However, although the evidence shows that the home environment and discipline is poor, the witnesses testified predominately that the children were healthy and bright. No evidence demonstrated problems in school. Therefore, of the facts presented, not all are negative.

In 1980, the Montana Department of Social and Rehabilitative Services was granted temporary investigative authority of the appellants’ children. In 1984, a petition for temporary legal custody of the three children was filed. An adjudicatory hearing was held in March of 1985 and the children were adjudicated youths in need of care. A dispositional hearing in April of 1985 resulted in an order that custody be granted to the Lake County Office of Human Services for foster home placement. The three children were placed in two separate homes for an initial period of one year. The appellants filed this appeal after the dispositional order. The appeal is from both the adjudication and disposition. The guardian ad litem was granted leave to file an amicus curiae brief.

The first issue presented for review is whether the District Court committed reversible error in failing to make a record on its in-chambers interview with the children. Near the conclusion of the adjudicatory hearing there was discussion concerning the District Court’s intention to conduct an in-home inspection and an in-chambers interview of the children. However, there is no record of, or reference to, the in-chambers interview beyond the discussion of intent to conduct such an interview. Absent a record or a reference, we do not know if the interview was conducted; however both parties treat the matter as if it was. The remaining discussion on this issue will be based on the assumption that it was conducted.

The appellants, in their argument that the District Court erred in not making a record of the interview, refer to Section 40-4-214(1), MCA, contained in the statutes on child custody matters in marriage dissolution, which reads:

“The court may interview the child in-chambers to ascertain the child’s wishes as to his custodian and as to visitation. The court may permit counsel to be present at the interview. The court shall cause a record of the interview to be made and to be part of the record in the case.”

In further support of their argument the appellants cite In re Marriage of Brown (1978), 179 Mont. 417, 587 P.2d 361, wherein a District Court did not make a record of the in-chambers interview with the children in a dissolution of marriage custody proceeding. We remanded in Brown for reconsideration of the property division and also on the basis that a record of the in-chambers interview was mandated by statute. Brown, 587 P.2d at 336. The appellants point out that the rationale in Brown was reiterated in Wilson v. Wilson (1979), 180 Mont. 377, 590 P.2d 1136. We did not remand in Wilson, however, because the District Court had entered findings as to the child’s wishes and, also, a witness had testified as to what occurred during the interview. Wilson, 590 P.2d at 140. We note that no findings were made concerning the in-chambers interview in the instant case.

The respondent, State, attempts to counter the appellants’ argument on this issue by pointing out two problems: nonapplicability of the cited law and waiver. The respondent argues that Section 40-4-214(1), MCA, is part of the Uniform Marriage and Divorce Act. It deals only with child custody in a dissolution proceeding, and there is no provision in the child abuse, neglect, and dependency statutes requiring an interview to be recorded. If correct, this same reasoning would apply to the Brown and Wilson case law, as it dealt with child custody in dissolution proceedings also. As to waiver, the respondent relies heavily on the transcript setting forth the discussion in the District Court concerning the District Court’s intentions to conduct the in-home inspection and the in-chambers interview. The respondent alleges that the appellants freely consented to the interview between the District Court and the children when it was clear the interview would not be recorded.

Section 40-4-214(1), MCA, deals with child custody in a dissolution of marriage proceeding. It is true that no provision in the abuse, neglect, or dependency statutes require an interview to be recorded. However, we find no provision in those statutes that specifically allows for an in-chambers interview either.

Whether dealing with child custody in a dissolution proceeding, or in an abuse, neglect, or dependency proceeding which may result in removing custody of a child from the parents, the same legal reasoning applies to any in-chambers interview conducted. That reasoning is best set forth in the commissioner’s note to Section 40-4-214, MCA, which provides:

“This section . . . [is] designed to permit the court to make custodial and visitation decisions as informally and non-contentiously as possible, based on as much relevant information as can be secured, while preserving a fair hearing for all interested parties.
“The general rule is that the judge may interview the child in chambers. It is often important for the judge to discover the attitudes and wishes of the child, and there is no reason to subject the child to the formality of the courtroom and the unpleasantness of cross examination. This provision does not require the judge to permit counsel to be present at the interview, but he must make some kind of record of the interview (using a court reporter or a tape recorder) so that counsel for all parties will have access to the substance of the interview.”

Section 40-4-214, MCA, (Annot.).

The same reasoning applies to a dispositional hearing concerning custody of youths in need of care. The nature of the children’s interest can best be gleaned from such an interview, while shielding the children from the rigors of the courtroom. However, the parties to the dispositional hearing have just as great a need for access to the substance of the interview as do parties to a custody in dissolution hearing. Furthermore, as a matter of due process, a record made in-chambers provides this Court access to evidence on which the District Court may have relied in making its order. As we have explained:

“Without the record of the interview and without specific findings as to the wishes of the children, counsel and this Court do not know with any degree of certainty the basis for the District Court’s conclusion on custody matters.”

In re Marriage of Brown (1978), 179 Mont. 417, 426, 587 P.2d 361, 366. We hold that a District Court may conduct an in-chambers interview of children in an abuse, neglect and dependency proceeding. However, once the District Court, in its discretion, decides to hold such an interview it must make a record of the interview. The respondent’s argument that the parents’ waived their right to access to a record of the interview has no merit. In the discussion between the court and the parties regarding the interview, no mention was made of a record and it was reasonable of the appellants to assume that a record would be made.

The second issue presented by the parents is whether the District Court’s findings of fact and conclusions of law are supported by sufficient evidence. For discussion, we combine this issue with the children’s second issue of whether certain reports should be disregarded by this Court because they were inadmissible as hearsay.

The findings of a district court in an abuse or neglect action enjoy a presumption of correctness and will not be overturned unless so unsupported by credible evidence as to amount to a clear abuse of discretion. In re C.M.S. (Mont. 1979), 187 Mont. 115, 121, 609 P.2d 240, 243, 36 St.Rep. 2004, 2008. Furthermore, in a bench trial, such as this, we presume the district judge disregarded inadmissible evidence in reaching his decision. In the Matter of M.F., J.F. and R.W. (Mont. 1982), 201 Mont. 277, _, 653 P.2d 1205, 1210, 39 St.Rep. 2103, 2109; In the Matter of Moyer (1977), 173 Mont. 208, 211, 567 P.2d 47, 49.

The parents’ attorney objected to the presence in the court file of any statements not supported by testimony. We have cautioned that “The possibility of error would be great where a trial court relied on reports not supported by examination at a custody hearing.” In the Matter of M.F., J.F. and R.W. (Mont. 1982), 201 Mont. 277, [287], 653 P.2d 1205, 1210, 39 St.Rep. 2103, 2109. Due process is violated if the authors of such reports are not required to testify and be subject to cross-examination. In the Matter of Moyer (1977), 173 Mont. 208, 211, 567 P.2d 47, 49. However, in this instance, the author of the reports did testify and were subject to cross-examination. No evidence was presented to rebut the presumption that any hearsay within the reports, themselves, was disregarded by the District Court. The court explicitly based its findings upon the testimony of the witnesses and upon the reports of only those who testified. Therefore we find that the District Court properly considered only the admissible evidence. However, because of the uncertainty of the substance of the in-chambers interview we cannot say that there was substantial credible evidence to support the adjudicatory order.

The parents also contend the District Court erred in indicating its intention to transfer custody from the parents to the Department of Social and Rehabilitation Services before the dispositional hearing was completed. The parents argue this made the completion of the dispositional hearing required by section 41-3-406, MCA, a mere formality. The mandate of section 41-3-406 is clear. A district court may make a dispositional order only after a dispositional hearing. We have cautioned previously that “[t]o insure that the minors involved received the full protection of [custody] laws, these procedures should be ‘rigorously followed.’ ” In the Matter of Guardianship of Aschenbrenner (1979), 182 Mont. 540, 553, 597 P.2d 1156, 1164. Here, the record indicates the District Court stated its intention to transfer custody to the State three times, and before the parties had the opportunity to present any evidence at the dispositional hearing. This is error and we reverse.

This case is remanded in order to clarify the evidence relied on by the District Court to support the adjudicatory order and to allow for a full dispositional hearing. The children’s guardian ad litem argues that because of surprise they were unaware that the State would recommend separating the children, and therefore was unable to present evidence on that issue or effectively cross-examine the testimony which recommended the separation. Because we remand, another opportunity to present the children’s interest will be afforded to counsel.

Reversed and remanded.

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


text:
    ANNA MARIE PHELAN, Claimant and Appellant, v. LEE BLAINE ENTERPRISES, Employer, and St. Paul Mercury Insurance Company, Defendant and Respondent.
    No. 85-290.
    Submitted on Briefs Oct. 31, 1985.
    Decided Feb. 27, 1986.
    Rehearing Denied April 28, 1986.
    716 P.2d 601.

      Keefer, Roybal, Hanson, Stacey & Jarussi, Gene R. Jarussi, Billings, for claimant and appellant.
    Lucas & Monaghan, Thomas Monaghan, Miles City, for defendant and respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

The claimant, Anna Phelan, a twenty-four year old female, filed a Petition for Hearing before the Workers’ Compensation Court asking the court to set aside a final settlement entered into August 1981 on the grounds that the parties to the settlement were suffering from a mutual mistake of fact. The court barred claimant’s petition as res judicata and this appeal followed.

We reverse the judgment of the Workers’ Compensation Court barring claimant’s petition, and remand this matter to the court with directions to hear the petition on its merits.

The present action arises out of a case which was previously before the Workers’ Compensation Court. The prior case was entitled Phelan v. Big Bear Stores, Inc. et. al. It was assigned docket number 1432 and court file number 1281-102. The decision of the Workers’ Compensation Court was issued on March 21, 1984. For brevity’s sake this prior case will herinafter be referred to as “Phelan I.”

In Phelan I, the Workers’ Compensation Court was faced with a complex factual situation and some novel questions of law.

On October 30, 1980 claimant suffered a back injury while employed by Lee Blaine Enterprises who was insured by St. Paul Mercury Insurance Company (“St. Paul”). The claimant underwent back surgery, and by July 7, 1981, was judged by her treating physician to have reached a stationary state. The physician rendered an impairment rating of 25%, and in August 1981, claimant entered into a final settlement of her claim. She received 125 weeks of permanent partial disability benefits, less some overpayments, for a total net settlement of $9,556.43. It is this final settlement which is the subject of the current appeal.

In June 1981 (prior to the final settlement mentioned above), the claimant was employed by a second employer who was insured by Glacier General Insurance Company. While employed by the second employer, the claimant experienced a sexual incident which she considered to be a sexual assault. She did not work from the date of the incident (June 29, 1981) until September 1, 1981.

In September 1981, the claimant was employed by a third employer which was insured by the State Compensation Insurance Fund. While employed by this third employer, the claimant suffered an industrial accident.

In general, the court in Phelan I was asked to determine the following issues: First, was the amount received by the claimant in her final settlement arising out of the October 30, 1980, injury sufficient in light of her disability? Second, was the sexual incident which occurred in June of 1981 a compensable injury under the Workers’ Compensation Act? Third, what was the nature and extent of claimant’s current disability, if any, and her entitlement to benefits, if any?

On March 21, 1984, the Workers’ Compensation Court entered its judgment. Succinctly stated, the court’s judgment was that the sexual incident did constitute a compensable injury, and that the claimant was currently (as of the date of the judgment) entitled to temporary total disability benefits by reason of the injury which occurred in September 1981 while employed by the third employer. In addition, these temporary total disability benefits were ordered to continue until the disability ceased as a result of that injury. The court also found that claimant may be entitled to additional benefits at “some later date.” No party to that first case requested a rehearing or appealed the court’s judgment.

It is important to note for the purposes of the current appeal that the court’s judgment in Phelan I dealt only with the claimant’s current disability status and her current entitlement to disability benefits. The record indicates there was no ruling on the issue of whether the final settlement (entered into in 1981) arising out of her October 30, 1980, injury was sufficient in light of the claimant’s disability as of the date of the settlement.

On October 8, 1984, claimant filed a Petition for Hearing seeking to set aside the final settlement entered into in August 1981 between herself and St. Paul. The claimant asked to have the settlement set aside on the grounds that the parties to the settlement were suffering from a mutual mistake of fact at the time the settlement was entered into. The relief requested by the claimant was denied by the court on the grounds of res judicata. Specifically, the court ruled that claimant had raised basically the same issue in Phelan I (the first issue mentioned above) as she had raised in her current petition. The court found that although the language of these two issues were not identical, both framed the same issue: whether the claimant is entitled to reopen her final settlement agreement of August 1981. The court found it had already ruled on this issue and consequently barred her current petition as res judicata.

The claimant raises the following issue for review by this Court:

(1) Did the Workers’ Compensation Court err in applying the doctrine of res judicata to deny claimant’s request that her final settlement of August 1981 be set aside?

The doctrine of res judicata is designed to prevent “relitigation of that which has been finally adjudicated.” S-W Company v. John Wight, Inc. (1978), 179 Mont. 392, 404-5, 587 P.2d 348, 355. The criteria used to determine whether an issue is barred by res judicata were set forth by this Court in Smith v. County of Musselshell (1970), 155 Mont. 376, 378, 472 P.2d 878, 880, as follows:

“These criteria are: (1) the parties or their privies must be the same; (2) the subject-matter of the action must be the same; (3) the issues must be the same, and must relate to the same subject-matter; and (4) the capacities of the persons must be the same in reference to the subject-matter and to the issues between them.”

Of the four criteria set out in Smith, the parties agree the important one in the present case is criteria (3) which is the identity of the issues. The rule regarding the identity of the issues is simple. If the issues in the second case were not raised and determined in the first case, then the judgment of the first case does not bar the second action. Specifically, this Court has held:

“[U]nless it clearly appears that the precise question involved in the second case was raised and determined in the former, the judgment is no bar to the second action.”

Brannon v. Lewis and Clark County (1963), 143 Mont. 200, 207, 387 P.2d 706, 710-711.

Applying the above standards to the instant case, we hold the Workers’ Compensation Court erred in denying claimant’s petition to set aside the final settlement on the grounds of res judicata.

First, the issues in Phelan I and the present case are not the same. In Phelan I the issue before the Workers’ Compensation Court which was similar to the main issue in the present case was issue number 3:

“3. Whether claimant’s final settlement arising out of her injury on October 30, 1980, is sufficient, and, if not, the total amount of compensation to be awarded to her as a result of the disability that she suffered from her industrial accident of October 30, 1980.”

The record indicates issue number 3 in Phelan I was based on a case decided by this Court in November 1981, three months after the parties entered into the final settlement which is the center of the present dispute.

In November 1981, this Court decided Holton v. F.H. Stoltze Land and Lumber Company (1981), 195 Mont. 263, 637 P.2d 10. In Holton this Court ruled that a carrier had a duty to pay without delay undisputed benefits. This undisputed amount was to be paid without requiring a claimant to enter into a settlement. Holton, 637 P.2d at 13, 14.

In light of Holton, the record indicates claimant presented issue number 3 (quoted above) to the Workers’ Compensation Court in Phelan I. It was claimant’s position in Phelan I that the settlement should be reopened because claimant had settled her case (and thus given up a valuable right) in exchange for an amount equal to the undisputed liability. Under Holton, the claimant argued, that amount should have been paid without requiring any settlement. Specifically, it was claimant’s contention in Phelan I (as set out in the pre-trial order) that:

“The settlement with St. Paul Mercury Insurance Co. on September 17, 1981, was on a Final basis (i.e., could be reopened within four years) and was based on an impairment rating of 25% given by Dr. Maurice Smith. However, the Montana Supreme Court in Holton v. F. H. Stoltze Land & Lumber Co., 38 St. Rptr., 1835, 637 P2d 10 (1981) held that an injured worker is entitled to be paid the impairment rating absolutely and in all events, with no strings attached. Thus, claimant is entitled to be paid 125 weeks (500 x 25%) at her permanent partial rate of $85.00, or $10,625.00 absolutely and in all events without being required to give up a valuable legal right, i.e., to keep her case open indefinitely. This fact, plus the fact that her legal disability as defined by 39-71-121 MCA is greater than her impairment rating, mandates that the Final settlement with St. Paul be reopened.”

We hold the question in Phelan I, with regard to issue number 3, was basically one of amount. That is, was the settlement in sufficient amount to compensate the claimant adequately for her disability given the holding of Holtonl

The issue in claimant’s present petition before the Workers’ Compensation Court was as follows:

“1. Whether at the time of settlement the parties were suffering from a mutual mistake of fact which now requires that the settlement be set aside.”

That is, were the parties suffering from a mutual mistake of fact at the time of settlement which requires that settlement be set aside?

Claimant asserts the mistake of fact under which the parties were laboring in August 1981 was the fact (unknown to either St. Paul or claimant) that claimant was actually totally disabled by reason of the June 1981 sexual assault. Claimant argues since she was totally disabled by reason of the second industrial accident, it was not possible for her or St. Paul to consider and evaluate her permanent disability which resulted from her first injury in October 1980. Claimant argues the doctor’s rating could not be intelligently evaluated by herself or St. Paul because she was totally disabled by reason of a second, separate injury. Therefore, claimant argues, their mutual mistake as to the status of her disability when the settlement was entered into is the mistake which requires the settlement to now be set aside.

In light of the discussion above, we hold the issues in Phelan I and the present case are not the same. In Phelan I, the question was basically one of amount. In the present case, the question goes straight to the validity of the settlement agreement itself. The issues are different — for this reason alone res judicata does not apply.

The second reason we hold the Workers’ Compensation Court erred in denying claimant’s petition on the grounds of res judicata is because issue number 3 in Phelan I was not decided. In its decision in Phelan I, the Workers’ Compensation Court did not rule on claimant’s contention that she was entitled to reopen her final settlement under the Holton case. This issue went unanswered.

The Workers’ Compensation Court in Phelan I did say that claimant was currently (as of the date of the judgment) totally disabled and entitled to temporary total disability benefits. The court also assigned responsibility for the claimant’s current disability. The court found that claimant’s disability stemmed from her third industrial accident which occurred September 1981. Thus, St. Paul (the insurer at the time of the first industrial accident) was not responsible for the claimant’s temporary total disability benefits. Likewise, Glacier General (the insurer at the time of the sexual assault) was not responsible for the claimant’s current temporary total disability benefits. Specifically, as to St. Paul, the court found in Phelan I as follows:

“3. Lee Blaine Enterprises (Employer) and St. Paul Mercury Insurance Company (defendant) are not liable to the claimant for further compensation or payments.
“The claimant’s October 30, 1980, injury and subsequent laminectomy resulted in á physical impairment that had reached a stationary state by July 7, 1981. Dr. Smith concluded that she had reached maximum medical healing as of that date, and rated her impairment at 25 percent. Finding of Fact No. 8. There is evidence that the stress of this injury also contributed to her generalized anxiety disorder. Finding of Fact No. 12. This disorder was diagnosed on June 19,1981, but had stabilized by August of the same year. Id.
“Montana is ‘committed to the doctrine that the particular injury must be the proximate cause of the present condition for which the claimant seeks compensation.’ Newman v. Kamp, 140 Mont. 487, 495, 374 P.2d 100, 104 (1962); Little v. Structural Systems, 188 Mont. 482, 614 P.2d 516, 37 St. Rptr. 1187, 1191 (1980). Here it is determined that the claimant’s current disability is based on her fear of associating with men and her back condition, caused by the Sign Talker sexual incident and the Big Bear accident, respectively. Findings of Fact Nos. 8, 9, 13, 14.
“Since the claimant’s back had reached maximum medical healing prior to her second physical injury at Big Bear, Lee Blaine Enterprises and St. Paul Mercury Insurance Company cannot be held liable for her current physical disability . . . .”

The finding in Phelan I that St. Paul was not liable for claimant’s current physical disability did not answer the question of whether claimant had received sufficient compensation in her 1981 final settlement. In other words, the record indicates no ruling was made by the court in Phelan I on issue number 3 which raised the question of whether Holton, supra, mandated a reopening of the final settlement. Therefore, even if the issue in Phelan I was identical to the issue in the present case (which it is not), res judicata would hot bar the present case because the issue was not decided in Phelan I.

Finally, it should be noted that the present issue of whether the parties were suffering from a mutual mistake of fact with regard to the final settlement could not have been raised in Phelan I. In its brief, St. Paul argues that the doctrine of res judicata bars the claimant’s petition because the current petition raises an issue which should have been raised and decided in Phelan I. In other words, St. Paul argues that claimant’s current petition is barred because it raises a matter which could have been litigated in Phelan I.

There is authority holding that the doctrine of res judicata applies not only to “issues which were raised and decided, but to issues which should have been raised and decided.” Hadford v. Hadford (Mont. 1981), 633 P.2d 1181, 1185, 38 St.Rep. 1308, 1313. However, this rule is not applicable in the present case.

As noted earlier in this opinion, the Workers’ Compensation Court in Phelan I found that at the time the parties entered into the final settlement for claimant’s first industrial accident, claimant was actually totally disabled by reason of a second, separate compensable injury. Only after the court decision from Phelan I did the parties know that the sexual assault was a second industrial accident and that claimant was totally disabled by reason of this second accident at the time she settled her claim with St. Paul. In other words, claimant’s present petition is based upon facts determined by the Workers’ Compensation Court in its Phelan I decision. Therefore, it would have been virtually impossible for claimant to have raised the issue of mutual mistake of fact with regard to the final settlement in Phelan I.

The judgment of the Workers’ Compensation Court barring claimant’s petition is reversed, and we remand this matter to the court with directions to hear the petition on its merits.

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