author: JUSTICE HUNT JUSTICE BARZ,

text:
    In re the MARRIAGE OF SUSAN RIDGEWAY ERNST, Petitioner and Appellant, and LENNIE RAY ERNST, Respondent and Appellant.
    No. 88-553.
    Submitted May 5, 1990.
    Decided May 24, 1990.
    As Modified on Denial of Rehearing June 20, 1990.
    793 P.2d 777.

      Joan Meyer Nye, Billings, for petitioner and appellant.
    Jo Mickelson, Dorsey & Whitney, Billings, for respondent and appellant.
   JUSTICE HUNT

delivered the Opinion of the Court.

The husband in a dissolution action, Lennie Ray Ernst, appeals from the judgment of the District Court of the Tenth Judicial District, Judith Basin County, which ordered him to pay maintenance support to the wife and cross-appellant, Susan Ridgeway Ernst. We affirm and dismiss the cross-appeal.

The issues raised on appeal are:

(1) Whether the District Court properly complied with the requirements of sec. 40-4-203(2), MCA, by awarding the wife maintenance in the form of monthly payments, educational expenses, and psychotherapy costs.

(2) Whether an award of $30,000.00 to the wife in the distribution of property by the District Court was a clear abuse of discretion.

(3) Whether the District Court’s findings, particularly findings Nos. 10, 11 and 15, are clearly erroneous.

(4) Whether this Court has jurisdiction over the wife’s cross-appeal.

Susan Ridgeway Ernst, the wife, and Lennie Ray Ernst, the husband, were married in Stanford, Montana, in 1976 and were married 11 years prior to their separation in March, 1987. Two children were born of this marriage: Ashley Jean Ernst, who was born on July 29, 1982, and Brandon Jacob Ernst, who was born on August 29, 1984. At the time wife and the husband separated, the wife was 30 years old and the husband was 32 years old.

During the majority of their marriage, the wife and husband resided on the Ernst family farm located south of Stanford. The husband has worked the family farm and developed it into a profitable enterprise. The wife, who had been valedictorian of her high school class, obtained one year of secretarial training and had worked outside the home during the first years of marriage. The wife quit her job in 1981 during her first pregnancy and has not worked outside the home since that time.

During their marriage, there were times when the husband was physically abusive to the wife. The majority of these incidents occurred during the first few years of marriage. It was common that these incidents were precipitated by the husband’s alcohol use. The husband has been diagnosed as suffering from an episodic alcohol abuse disorder and from an intermittent explosive personality disorder.

The wife has recently been diagnosed as suffering from a paranoid mental disorder. During the marriage, the wife was suffering from the affects of this disorder.

The wife filed for dissolution on April 24, 1987. A five day trial was held in February, 1988, on the issues of custody, property division and maintenance. Expert testimony was presented regarding both parties’ mental disorders. Expert testimony was also offered regarding the effects of spouse abuse syndrome. In May of 1988, the wife’s mental disorder resulted in the District Court committing the wife to the Montana Deaconess Medical Center in Billings, Montana, for a 30-day evaluation. On July 1, 1988, the court entered its findings of fact and conclusions of law. A motion to modify the findings of fact was filed by the wife on July 14, 1988. The husband contested this motion to modify upon jurisdictional grounds and, therefore, filed a notice of appeal on August 16, 1988. The court ruled on the wife’s motion on September 14, 1988, and the next day entered-the final Decree of Dissolution.

The husband filed a motion to amend the final decree, pursuant to Rule 59(g), M.R.Civ.P., on September 26, 1988. Before the District Court had ruled on the husband’s motion, the wife filed a notice of appeal. This notice of appeal was filed on October 12, 1988. The court subsequently ruled upon the husband’s motion on November 7, 1988. The husband filed his second notice of appeal on December 5.

The first issue on appeal is whether the District Court properly complied with the requirements of sec. 40-4-203, MCA, by awarding the wife maintenance in the form of monthly payments of $800.00, educational expenses to pursue a bachelor’s degree, and psychotherapy costs.

The appropriate standard of review for an award of maintenance is established by statute at sec. 40-4-203, MCA. See In re the Marriage of Barnard, [241 Mont. 147,] 785 P.2d 1387, (1990); In re the Marriage of Lundvall, [241 Mont. 172,] 786 P.2d 10, (1990). An award of maintenance is premised upon a finding by the court that the individual seeking maintenance “lacks sufficient property to provide for his reasonable needs; and is unable to support himself through appropriate employment.” Section 40-4-203(l)(a)(b), MCA. The District Court in this case made such a finding. The court must then consider all relevant facts in determining an appropriate award of maintenance. Section 40-4-203(2), MCA. Some of the relevant facts to be considered include:

“(a) the financial resources of the party seeking maintenance, including marital property apportioned to him, and his ability to meet his needs independently, including the extent to which a provision for support of a child living with the party includes a sum for that party as custodian;
“(b) the time necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment;
“(c) the standard of living established during the marriage;
“(d) the duration of the marriage;
“(e) the age and the physical and emotional condition of the spouse seeking maintenance; and
“(f) the ability of the spouse from whom maintenance is sought to meet his needs while meeting those of the spouse seeking maintenance.”

Section 40-4-203(2), MCA.

A specific finding by the court regarding each of these relevant facts is not required as long as the court considered proper information in addressing these facts and based its decision upon substantial credible evidence. In re Marriage of Cole, 234 Mont. 352, 763 P.2d 39 (1988). These relevant facts are to be considered by the court as a whole in the determination of the final maintenance award. Cole, 763 P.2d at 43.

There is substantial credible evidence to support the District Court’s monthly maintenance award of $800.00 to the wife. “Maintenance payments supplement the property division.” Cole, 763 P.2d at 42. The ability of the property award to produce income is an essential consideration in the determination of the appropriateness of a maintenance award. See generally Cole; In re the Marriage of Bowman, [_Mont. _,] 633 P.2d 1198, 38 St.Rep. 1525 (Mont. 1981). At the request of both parties, the husband was given all of the income-producing property, which included the farm and all of its accompanying assets and liabilities. As a result, the wife was given remaining property consisting primarily of a house, furnishings and a car. All of the wife’s property is income-consuming property in that it will not be able to produce income for the wife. In fact, this property will eventually require repair or replacement thereby depleting the wife’s property settlement.

Although the wife was allotted $30,000.00 by the court which at some time could be invested by the wife and thereby become income-producing, this amount will not come due for another six years. In the meantime, the wife has no means of support. She has had little education or experience in the work force. Additionally, she is suffering from a mental disorder which could reasonably make it difficult for her to secure a job at this time. The only evidence submitted to the court regarding an appropriate award for monthly maintenance was the uncontradicted statement by the wife that she, the husband and the children spent approximately $2,000.00 per month on living expenses while still living with the husband. In addition to the wife, the maintenance award must also support the children when the wife partakes of her liberal visitation rights. In light of these facts, $800.00 per month is not an unreasonable sum for the maintenance of a household.

There is substantial credible evidence to support the court’s award of educational expenses and psychotherapy costs. It is undisputed that the wife suffers from a paranoid mental disorder. Expert testimony revealed that she would need approximately two years of psychotherapy to overcome this disorder. Following psychotherapy, the wife should be capable of benefiting from higher education. This education is necessary to enable the wife to continue in her accustomed lifestyle.

The husband argues that Bowman states that the maintenance award should be struck down for failure to decree an amount certain. Although in Bowman we said that the type of property awarded and appropriate employment must be evaluated in “establishing amounts and duration of maintenance,” the amount established does not have to be certain. Bowman, 633 P.2d at 1201. In this case, it would be impossible to accurately determine the cost. However, the court was concerned and therefore placed conditional limitations on the wife. The husband is responsible for the wife’s psychotherapy for six years. The husband may obtain medical insurance to cover this responsibility. The wife must complete her educational degree within six years. Further, the education must be obtained from a college or university in Montana. These conditions sufficiently identify the costs involved.

The husband has also argued that his ability to meet these costs is determinative of the appropriateness of a maintenance award. We agree that this is an important consideration but must be viewed in accordance with the facts of this case. The husband has been given all of the income-producing property in the property settlement. The husband will continue to be engaged in an agricultural business that, for the past three years, has been increasingly profitable. It is reasonable to assume that the husband will continue on such a track. There is no information in the record to suggest that these maintenance payments will financially deplete the husband. In light of the facts of this case, the District Court’s award of maintenance to the wife is supported by substantial, credible evidence.

The second issue is whether the award of $30,000.00 by the District Court to the wife as part of the division of property was a clear abuse of discretion.

The husband argues that the District Court abused its discretion by awarding the wife $30,000.00, plus interest, as part of the property distribution. The husband argues that this ruling is inequitable in light of all of the maintenance payments the husband has also incurred. We disagree.

A “District Court’s judgment, when based upon substantial credible evidence, will not be altered unless a clear abuse of discretion is shown.” In re the Marriage of Stewart, 232 Mont. 40, 42, 757 P.2d 765, 767 (1988), citing In re the Marriage of Watson, 227 Mont. 383, 739 P.2d 951 (1987). Section 40-4-202, MCA, lists the factors the court must consider in dividing the property assets and liabilities between a husband and wife. The division must be “equitable” when reviewing the particular facts of the case with the factors listed. Section 40-4-202(1), MCA.

The District Court specifically found that the $30,000.00 award was equitable under the facts and circumstances of this case. The court’s finding regarding this $30,000.00 award reads as follows:

“[I]t was the court’s original purpose herein to divide the marital estate ‘equitably’ rather that necessarily ‘equally,’ as originally stated. Equity means, generally, as close to equality as possible and reasonable under the facts and circumstances of the particular case and in keeping with the principles of justice. These parties originally married and set out to share their lives and all included therein. Both used their wits and their goods for the good of their family. Each contributed equally; each must share in proportion to his or her contribution if possible. It is possible here.”

This finding indicates that the District Court did not abuse its discretion in awarding the wife the $30,000.00. Upon reviewing the particular facts of this case, the court concluded that each party had essentially contributed equally to the marriage and was entitled to as close to equal portions of the acquired property as possible.

The District Court also placed a value upon all of the assets and distributed these assets in accordance with the wishes of the parties in keeping the farm intact. Subsequently the court found it necessary to award the wife $30,000.00 in an attempt to equalize the property division. Based upon the court’s findings and the particular facts of this case, there is substantial credible evidence to support the $30,000.00 award to the wife.

The third issue raised is whether the District Court’s findings, particularly findings Nos. 10, 11, and 15, are clearly erroneous.

The husband argues that the District Court’s findings are not supported by substantial, credible evidence and, are therefore, clearly erroneous. The particular findings that the husband argues are unsubstantiated are: the finding that the husband’s physical abuse of the wife during marriage was instrumental and causative of the wife’s mental and psychological problems; the finding that on several boccasions the children were witnesses to violence; and the finding that the wife’s mental disorder had not adversely affected either child. We find that there is substantial, credible evidence to support the findings of the District Court and they are not, therefore, clearly erroneous.

‘ ‘Findings of fact shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge the credibility of the witnesses.” Rule 52(a), M.R.Civ.P. Evidence was presented at trial regarding the wife’s mental disorder and of the effects of spouse abuse syndrome. It was indicated at trial that spouse abuse syndrome could be a cause of the wife’s disorder. The husband’s expert, Dr. Tranel, testified that he had insufficient information at that time to determine the exact cause of the wife’s mental disorder. Without evidence to the contrary, the District Court’s conclusion that the physical abuse by the husband may have been one of the known causes of the wife’s mental disorder is supported by substantial credible evidence and is, therefore, not clearly erroneous.

The District Court found that on several occasions the children were witnesses to violence. Testimony from primarily the wife indicated that there was one recent occasion when the husband threw her against the wall while she was holding Brandon. Additional testimony indicated that Ashley had been disciplined at least twice by the husband hitting her on the back. Although the word “several” may not have been completely appropriate, we hold that there is substantial, credible evidence to support the District Court’s conclusion that the children had been witnesses to violence. The use of the word several, if error, was harmless.

Conflicting evidence was presented at trial concerning the effect the wife’s mental disorder had on the children, particularly Ashley. As long as the court’s findings are supported by “substantial though conflicting” evidence such findings will not be disturbed. See In re the Marriage of Johns, [238 Mont. 256,] 776 P.2d 839, 841, 46 St.Rep. 1249, 1251 (Mont. 1980). Expert testimony at trial provided very little evidence concerning the effect the wife’s disorder had on the children. The court was in the best position to judge the credibility of the witnesses and their testimony. From this position the court chose to emphasize the testimony that the wife’s mental disorder had not adversely affected either child. There is substantial credible evidence to support the District Court’s finding.

The final issue, raised on cross-appeal by the wife, is whether the District Court erred by refusing to award attorney’s fees to the wife. This issue must be dismissed for failure to be properly raised upon appeal in accordance with Rule 5(a)(4), M.R.App.P.

Normally, the time for filing an appeal is 30 days from the entry of judgment. Rule 5(a)(1), M.R.App.P. However, an exception to this filing rule exists in Rule 5(a)(4), M.R.App.P. The exception states, in pertinent part, that:

“(4) If a timely motion under the Montana Rules of Civil Procedure is filed in the district court by any party:... (iii) under Rule 59 to alter or amend the judgment;.. .time for appeal for all parties shall run from the entry of the order denying a new trial or granting or denying any other such motion.. .A notice of appeal filed before the disposition of any of the above motions shall have no effect. A new notice of appeal must be filed within the prescribed time measured from the entry of the order disposing of the motion as provided above ...” (Emphasis added.)

Rule 5(a)(4), M.R.App.P.

In this case, the final Decree of Dissolution was filed on September 15, 1988. As a result, the husband’s notice of appeal filed August 16, 1988, was premature and invalid. The husband filed a timely motion to alter or amend the decree, pursuant to Rule 59(g), M.R.Civ.P., on September 26, 1988. The court’s order on the motion was dated November 4, 1988, and was filed on November 7, 1988. The wife’s motion for appeal, filed on October 12, 1988, was filed prior to the court’s ruling on the pending motion to amend and is, therefore, invalid under Rule 5(a)(4), M.R.Civ.P. A notice of appeal was required to be filed by either party 30 days from November 7, 1988, the date of entry of the court’s order disposing of the motion to amend. See generally In re the Marriage of Neneman, 217 Mont. 155, 703 P.2d 164 (1987). The wife failed to comply with this requirement.

AFFIRMED with dismissal of the cross-appeal.

CHIEF JUSTICE TURNAGE and JUSTICES SHEEHY, McDON-OUGH and WEBER concur.

JUSTICE BARZ,

dissenting.

I dissent and would remand this case to the District Court on several grounds. The District Court completely failed to address or consider sec. 40-4-203(2)(b), MCA, in determining an appropriate award of maintenance. That factor in light of the maintenance award in this case is very important: namely the ability of the spouse from whom maintenance is being sought to meet his needs while meeting those of the spouse. Here we have the husband required to pay $800 per month for maintenance plus the wife’s psychotherapy for two years, including hospitalizations and costs of her college for six years without restriction. In addition, the husband is to make house payments for the wife, completely support the children and provide for their counseling, and pay for counseling for himself. There is no evidence whatsoever where he is to find that kind of money other than the assertion that he is a “successful” farmer. The wife testified that she, the husband and children spend approximately $2,000 per month and the husband agreed but did point out that figure included farming expenses as well. Spending $2,000 per month and having the income or means to spend that much are significant differences on which the record is silent.

In Finding of Fact No. 10, the court found:

“10. Petitioner, to one degree or another, suffers from a paranoid disorder which will require at least two years of intensive counseling. There is no evidence that this disorder has adversely affected either of the children of the parties hereto; and, at this point, it is purely speculative that said disorder will have an adverse effect in the future.”

In light of the court’s finding and evidence on the five-year-old daughter’s “emotionally disturbed” condition, Finding No. 10 is not only clearly erroneous, it is preposterous. The wife’s mental illness and her bizarre behavior because of it cannot be ignored anymore than the husband’s personality disorder as it related to the best interests of the children. To say there is no adverse effect on either of the children is a naive opinion of the District Court and contrary to the evidence in this case.

In Finding of Fact No. 15, the District Court stated:

“15. The finding is unavoidable that Petitioner’s health problems spring from and are to a large extent result from her physical and emotional abuse and humiliation by the Respondent during the marriage. She is shown to be intelligent, having a pleasing personality and to have been normal before her marriage. She was involved to a degree in some very fundamentalist religious practices during marriage, which caused some waves, but don’t appear to be a major force in her present condition. Her religious and health concerns appear to be coincidental or concurrent or even part of her problem, rather than causal.”

That finding is clearly erroneous if the court is attempting to find the cause of her mental illness. Such a finding of marital misconduct is also contrary to Montana’s no-fault dissolution law.

Dr. Tranel testified that one could not know the causes of the wife’s mental illness of a paranoid disorder, and data showing biological contribution, psychological factors and social contributions to the disorder all interact and need to be considered. Dr. Tranel also pointed out there is a strong school of thought in his profession that believes that the mental disorder is primarily a biochemical malfunction but it was his opinion that that evidence alone is inconclusive. In addition, there was no psychiatric or medical testimony presented during the trial which would allow the District Court to find the causative factor of the wife’s illness. In actuality it serves little purpose to find the causative factor, particularly if it is in fact a genetic condition which is inherited. Regardless, treatment is necessary.

Both Finding No. 10 and Finding No. 15 should be vacated or at least modified. It would appear, unfortunately, that the District Court Judge has not seen the last of this family’s problems in any event.

JUSTICE HARRISON joins in the foregoing dissent of JUSTICE BARZ.


source: Caselaw Access Project

author: JUSTICE HARRISON JUSTICE WEBER,

license: Public Domain

text:
    STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff and Respondent, v. The ESTATE OF GARY NELSON BRAUN, Deceased, and Chester V. Braun, Personal Representative of the Estate of Gary Nelson Braun, Deceased, Defendant and Appellant.
    No. 89-261.
    Submitted May 24, 1990.
    Decided May 24, 1990.
    Rehearing Denied June 20, 1990.
    793 P.2d 253.

      Barry G. O’Connell argued, Moore, O’Connell, Refling & Moon, Bozeman, for defendant and appellant.
    Lyman H. Bennett, III, argued, Morrow, Sedivy & Bennett, Bozeman, for plaintiff and respondent.
   JUSTICE HARRISON

delivered the Opinion of the Court.

This is an appeal from a grant of summary judgment in favor of State Farm regarding an insurance coverage dispute. The Eighteenth Judicial District Court, Gallatin County, Montana, determined that Canada’s wrongful death damage limitation governed the damages available to appellants. The District Court held that State Farm had no obligation to appellants under either the uninsured or underinsured motorist provisions of the deceased insured’s policy. We reverse and remand for further proceedings consistent with this opinion.

Appellants raise two issues for review:

1. Should Canadian law or Montana law govern the damages available to appellants for Braun’s wrongful death given that Canada’s wrongful death damage limitation conflicts with Montana law?

2. Does State Farm have an obligation to appellants under either the uninsured or underinsured motorist provisions of Braun’s policy?

The parties stipulated to an agreed statement of facts. Briefly, the decedent, Gary Braun, died as a result of a motor vehicle accident that occurred near Crestón, British Columbia. The driver of the vehicle in which Braun was a passenger was found liable for the accident. A Canadian insurance company, Alberta Motor Association Insurance Company, insured the vehicle with policy limits of $200,000. In wrongful death tort actions, Canadian law severely restricts damages and under the circumstances of this case, Alberta Motor has advised appellants that it would not pay any claims in excess of funeral expenses.

At his death, the decedent was an insured of State Farm. The insurance contract was made in Gallatin County and the decedent’s vehicle, to which the insurance contract applied, was principally garaged in Gallatin County. The insurance policy provided the decedent with uninsured and underinsured motorist coverage. The decedent paid a separate premium for each coverage. Also the policy provided that the coverages purchased extended to Canada.

I

This case presents a controversy between an insurer and an insured over the interpretation of an insurance contract. As such the dispute sounds in contract and should be resolved by contract law. The question of whether Montana law or Canadian law should govern the measure of damages available to appellants is a conflict of laws question regarding tort law. However, tort law only incidentally enters this dispute because the insurance policy requires that the tort-feasor’s fault must be established before the insured can invoke the policy’s underinsured motorist protection. No dispute regarding fault exists. As this dispute must be resolved by application of contract law, Issue II is dispositive and we need not discuss Issue I. Further, no question exists that Montana law governs the interpretation of the insurance contract at issue here and neither party argues to the contrary.

II

While we agree with respondent that appellants cannot recover under the uninsured motorist provision, we hold that the appellants can recover under the underinsured motorist provision of the decedent’s insurance contract.

The insured purchased underinsured motorist coverage from respondent for which he paid a separate premium. Regarding underinsurance coverage, the policy provided as follows:

“We will pay damages for bodily injury and insured is legally entitled to collect from the owner or driver of an underinsured motor vehicle.” (Emphasis added.)

The pertinent part of the definition of an underinsured motor vehicle is the following:

“Underinsured Motor Vehicle — means a land vehicle:
“(2) Whose limits of liability for bodily injury liability:
“a. are less than the amount of the insured’s damages; or b. have been reduced by payments to persons other than the insured to less than the amount of the insured’s damages.” (Emphasis added.)

Also at issue is the following policy language:

“There is no coverage until the limits of liability of all bodily injury liability bonds and policies that apply have been used up by payments of judgments or settlement.” (Emphasis added.)

Appellants contend that the District Court erred in determining that appellants were legally entitled to collect only the damages allowed by Canadian law. According to appellants, the language “legally entitled to collect” simply means that the insured must have a cause of action against the tort-feasor and must be able to establish fault and the existence of damages. Further, appellants aver that the “limits of liability” language is contrary to an insured’s reasonable expectations and to fully compensating injured parties for their losses. We agree. Initially, respondent contends that the Canadian damage limitation operates as a limited immunity that is available to respondent because it is available to the Canadian tort-feasor. Analogizing to Hubbel v. Western Fire Ins. Co. (1985), 218 Mont. 21, 706 P.2d 111, respondent argues that the Canadian damage limitation is similar to the immunity provided under the Workers’ Compensation statutes to employers and coemployees of injured workers. Workers’ Compensation statutes and similar statutes deny a cause of action to an injured party in certain circumstances.

Contrary to respondent’s assertion, reliance on Hubbel is misplaced. Hubbel involved an employee’s heirs trying to collect under an allegedly negligent coemployee’s uninsured motorist coverage. In Hubbel, we interpreted the language “legally entitled to recover damages” contained in the coemployee’s uninsured motorist policy. We held that because the Worker’s Compensation Act provided the exclusive remedy to an employee, Hubbel was not legally entitled to recover damages from the coemployee. Hubbel, 706 P.2d at 112-113. The Worker’s Compensation statutes denied the employee a cause of action under the facts of that case. Distinguishable from the Hubbel facts, the appellants in this case possess a cause of action against the tort-feasor. Canadian law does not deny injured parties a cause of action, it only restricts the damages recoverable.

Respondent also erroneously argues that the Canadian damage limitation shields respondent because it is available to the tortfeasor. In essence, respondent asserts that it is the tortfeasor’s alter ego. However, tort law is relevant only as far as the fault requirement is concerned. Once an insured demonstrates a legal entitlement to damages, principles of contract law define the coverage afforded by an underinsurance motorist provision.

The instant case is similar to Karlson v. City of Oklahoma City (Okla. 1985), 711 P.2d 72. In Karlson, the Oklahoma Supreme Court had to interpret the phrase “legally entitled to recover” in an underinsurance motorist provision. The plaintiffs sued the City for wrongful death arising out of a collision with a city police vehicle. Because the Oklahoma Political Subdivisions Tort Claims Act limits the City’s liability, the plaintiffs joined their underinsurance carrier as a defendant and sought to recover their excess damages under the underinsurance coverage. Karlson, 711 P.2d at 73. In reversing summary judgment for the insurer, the court held that the intention of the parties governed.

“When the insured and Allstate entered into their contract, they contemplated a situation where Allstate might be required to pay for injuries caused by some tortfeasor where the tortfeasor was not able to make full compensation for those injuries. Whether the tortfeasor’s inability to make full compensation results from lack of sufficient insurance, insolvency, or for other reason, is irrelevant.

“The intention of the parties at the time of their contracting was that Allstate, not its insured, would assume the risk that the insured might suffer a loss for which a tortfeasor could not make compensation. Our holding here merely gives effect to that intent.

“In summary, we hold that in a situation where liability of a tortfeasor is limited ... to an amount which will not compensate an insured for all his proven losses suffered in an automobile accident, that insured may recover from his insurer through the uninsured/ underinsured motorist provisions of his automobile liability insurance, according to the terms thereof.”

Karlson, 711 P.2d at 75. Thus, in spite of the damage limitation imposed by the Political Subdivisions Tort Claims Act, the Karlson plaintiffs were able to recover under their underinsurance coverage. The same reasoning guides our decision that respondent cannot take advantage of the Canadian damage limitation just because it is available to the tort-feasor. Contract law conditions respondent’s obligation under the insurance contract, not tort law.

Respondent also argues that the language “limits of liability” contained in the definition of “underinsured vehicle” in the insured’s policy plainly means the tort-feasor’s stated policy limits, $200,000 in this instance. Also, according to the policy terms, the limits of liability must be expended before an insured can recover under the underinsurance provision.

In insurance contract actions, the reasonable expectations of an insured regarding the scope of coverage has been recognized. Transamerica Ins. Co. v. Royle (1983), 202 Mont. 173, 180-181, 656 P.2d 820, 824. Under the facts of this case, the insured could reasonably expect the accident vehicle to qualify as underinsured, particularly because the policy specifically provides that coverages purchased extend to Canada. A reasonable average insured is not going to be aware that Canadian law restricts damages severely in relation to Montana law. If State Farm’s position is accepted, then State Farm sold to its insured and collected premiums for coverage in Canada that was worthless to the insured.

To allow State Farm to take advantage of Canadian damage law would negate the insured’s reasonable expectations under its policy contract with the insurer. The insured could reasonably expect to recover the difference between what he could collect from the tortfeasor’s policy and his proven damages, up to the policy limits purchased.

The purpose of underinsured motorist insurance is to provide a source of indemnification for accident victims when the tortfeasor does not provide adequate indemnification. Coverage under the terms of the policy at issue here should be predicated on an insured’s damages excluding the indemnification actually available from the tort-feasor’s liability insurance. In this case, even though the tort-feasor has $200,000 liability limits, that amount is not actually available because of Canadian damage restrictions. According to Alberta Motors Insurance Company, funeral expenses constitute the extent of its liability. Because the insured’s damages will certainly exceed funeral expenses, the tort-feasor cannot provide adequate indemnification. As far as the appellants are concerned, the tortfeasor’s remaining liability insurance is illusory. Therefore, we hold that appellants may recover under the insured’s underinsurance motorist provision that he selected and for which he paid if adequate compensation is not actually available from the insured tort-feasor because of the limitation of damages under Canadian law.

Our holding is not without precedent in other jurisdictions. Although Montana does not statutorily require that insurance companies offer underinsurance coverage, many states do.

The statutes fall into three categories which are based on comparisons of the tort-feasor’s liability insurance with either the amount of underinsured motorist insurance, the amount of uninsured motorist insurance or the damages or injuries sustained by the insured. In a number of those states, either the statute itself, or court interpretation of the statute, requires that the relevant comparison be made with the amount of the tort-feasor’s liability coverage that is actually available to an insured rather than to the stated liability limits that are theoretically available. Thus, through both express statutory definition and judicial statutory interpretation, underinsurance claimants have recovered in various situations which differ from simple comparison of stated coverage limits. These statutes and court opinions recognize, as does our holding, that a tort-feasor’s liability coverage is deficient if it does not actually provide adequate compensation to the injured party. This deficiency may arise in various ways, the most common of which, as the instant policy recognizes, occurs through reduction or exhaustion of a tort-feasor’s policy through payment to others. Significantly, deficiencies can also arise through damage limitations imposed by law.

In summary, we hold that the appellants can recover under the underinsured motorist provision of the insured’s insurance policy with respondent. Appellants are legally entitled to collect damages from the Canadian tort-feasor because the tort-feasor’s fault is established and damages exist. Respondent cannot avail itself of the Canadian damage limitation because contract law governs its relationship to appellants, not tort law.

We reverse and remand for further proceedings consistent with this opinion.

CHIEF JUSTICE TURNAGE and JUSTICES SHEEHY, BARZ, McDONOUGH and HUNT concur.

JUSTICE WEBER,

dissenting:

I respectfully dissent. The majority concludes that Montana contract law governs the interpretation of the insurance contract, including the insurance company’s obligation under that contract. I conclude the majority holding directly conflicts with Montana contract law.

The District Court concluded that the defendants were legally entitled to collect only the damages allowed by Canadian law. The defendants argued that “legally entitled to collect” simply meant that the insured must have a cause of action and must be able to establish fault and the existence of damages. The majority agreed with that contention. The plain language of the contract does not support such a conclusion. The contract stated:

“We will pay damages for bodily injury an insured is legally entitled to collect from the owner or driver of an underinsured motor vehicle. ’ ’

That contract provision makes no reference to a theory of having a cause of action, establishing fault and the existence of damages. Under the contract terms the insurance company has agreed with the insured to pay damages for bodily injury which the insured is “legally entitled to collect” from the driver of the underinsured motor vehicle. The venue of any action by the insured to recover damages for bodily injury against the driver of the other vehicle clearly is British Columbia, Canada. No factual or statutory basis has been established under which the insured could have sued the driver of the other vehicle in Montana. As a result, we must look to the law of British Columbia to determine the damages which the insured is legally entitled to collect from the driver of the other vehicle. Here the defendants, as the representatives of the deceased insured, are legally entitled to collect only funeral expenses in British Columbia.

In disregarding the clear and explicit meaning of the above contractual provision, the majority has disregarded the provisions of sec. 28-3-401, MCA, which states:

“EXTENT TO WHICH LANGUAGE GOVERNS INTERPRETATION. The language of a contract is to govern its interpretation if the language is clear and explicit and does not involve an absurdity.”

I conclude that under the clear and explicit provisions of this contract, the defendants are entitled to recover only the amount which they could legally collect from the driver of the other vehicle in British Columbia.

Do other contract provisions contradict the foregoing interpretation? I conclude they do not. As set forth in detail in the majority opinion, another clause provides there is no coverage until the limits of liability of other policies “have been used up.” The minimum liability limits under the Canadian policy were $200,000 and have not “been used up.” That plain and concise language is also consistent with my previous interpretation.

I conclude that contract law theory contradicts rather than supports the majority opinion. In addition to contract law theory, the majority opinion bases its conclusions on the reasonable expectations of an insured. I emphasize that Montana law does not require underinsured coverage in an automobile policy, as do many states. As a result, we have no legislative declaration of underinsurance requirements in Montana. No evidence was submitted showing the actual expectations of the deceased insured. In the absence of contrary requirements as established by Montana legislation, I can find no reasonable basis for this Court to disregard the clear and explicit provisions of the contract.

I would affirm the District Court.

        FOOTNOTES

      1. Included in these states are Texas, Maryland, Ohio, Florida, North Carolina, Iowa and Oklahoma. See A. Widiss, Uninsured and Underinsured Motorist Insurance (2d ed. 1987).


author: CHIEF JUSTICE TURNAGE

text:
    STATE OF MONTANA, PLaintiff and Respondent, v. DANIEL KURTIS MARQUARDT, Defendant and Appellant.
    No. 89-545.
    Submitted on Briefs April 12, 1990.
    Decided May 25, 1990.
    793 P.2d 799.

      Mark Bauer, Great Falls, for defendant and appellant.
    Marc Racicot, Atty. Gen., Helena, George Schunk, Asst. Atty. Gen., Helena, Thomas J. Sheehy, Chouteau County Atty., Fort Benton, for plaintiff and respondent.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

In February 1989, Daniel Marquardt was tried in the District Court of the Twelfth Judicial District, Chouteau County, on charges of robbery and three counts of felony assault. The jury was unable to reach a verdict and a mistrial was declared. Marquardt was retried and convicted on the same charges in May of 1989. He appeals. We affirm.

The sole issue on appeal is whether Marquardt was denied his constitutional right to speedy trial because of the delay prior to his first trial.

The charges against Marquardt arose out of an October 1987 robbery at the Kurth Ranch near Fort Benton, Montana. The facts of the crime are not at issue. Marquardt was arrested in Butte, Montana, on April 21, 1988, and an information was filed against him on May 2, 1988. He was released on bail on May 6, 1988.

Marquardt’s trial was originally scheduled for October 3, 1988. It was rescheduled for November 21, 1988, due to a conflict of trial dates. Marquardt moved for a change of venue and filed a motion in limine on October 28, 1988, following which the parties filed their respective briefs and a hearing was held. Then the term of District Judge Chan Ettien expired and the Honorable John Warner took his place. In January 1989, Judge Warner granted Marquardt’s motion for change of venue and set a trial date of February 28, 1989. Marquardt moved to dismiss for denial of speedy trial, but that motion was denied one week before the trial commenced.

The jury at Marquardt’s first trial was unable to reach a verdict. A mistrial was declared. When he was retried in May 1989, Marquardt was found guilty on all charges.

Was Marquardt denied his constitutional right to speedy trial because of the delay which occurred prior to his first trial?

The right to a speedy trial is guaranteed by both the Sixth Amendment to the United States Constitution and Article II, Section 24 of the Montana Constitution. It is a right of fundamental importance. Barker v. Wingo (1972), 407 U.S. 514, 515, 92 S.Ct. 2182, 2184, 33 L.Ed.2d 101, 108.

The State argues on appeal that any delay in Marquardt’s first trial is irrelevant in an analysis of a speedy trial claim. It cites the rule set forth in the American Bar Association Project on Minimum Standards for Criminal Justice, Speedy Trial, Section 2.2, (Approved Draft 1968), which was adopted by this Court in State v. Sanders (1973), 163 Mont. 209, 214, 516 P.2d 372, 375:

“When time commences to run.
“The time for trial should commence running
“(c) if the defendant is to be tried again following a mistrial, an order for a new trial, or an appeal or collateral attack, from the date of the mistrial, order granting a new trial, or remand.”

In Sanders, defendant claimed that he was denied his right to speedy trial. He asked the Court, in analyzing the issue, to look to the entire time between the filing of the information and his second trial (after reversal of his first conviction). This Court applied the above rule and considered only the time between the reversal and the beginning of the second trial. Sanders, 516 P.2d at 375. The same rule was applied in State v. Fife (Mont. 1981), 632 P.2d 712, 38 St.Rep. 1334. Only the time between the reversal of defendant’s first conviction and the commencement of his second trial was considered in the speedy trial analysis. Fife, 632 P.2d at 714.

Here, the claim is different. Marquardt claims a denial of his right to speedy trial only as to the period preceding his first trial. Section 46-20-701, MCA, provides that this Court may review on appeal errors affecting substantial rights. There can be no doubt that the District Court’s denial of Marquardt’s motion to dismiss affected his substantial rights. Had the motion been granted, the remedy would have been dismissal of the case. The second trial, resulting in Marquardt’s conviction, would never have occurred. However, under sec. 46-20-104, MCA, Marquardt’s right to appeal did not arise until the court entered a judgment of conviction against him. We conclude that the rule applied in Sanders and Fife does not apply in this instance. We hold that Marquardt properly preserved the issue of denial of speedy trial at his first trial and that it is an issue which may properly be considered in this appeal.

Support for our conclusion is found in Arnold v. McCarthy (9th Cir. 1978), 566 F.2d 1377. There, after noting that the defendant had timely raised his speedy trial claim before each trial, the court analyzed whether defendant was deprived of his right to a speedy trial in both his first trial, which resulted in a mistrial, and his second trial, which resulted in a conviction. Like the defendant in that case, Marquardt asserted his right to speedy trial in a timely manner prior to the mistrial.

The four elements considered in judging a claim of denial of the right to speedy trial are 1) the length of the delay, 2) the reasons for the delay, 3) the defendant’s timely assertion of the right to speedy trial, and 4) the prejudice to defendant as a result of the delay. State v. Curtis (Mont. 1990), [241 Mont. 288,] 787 P.2d 306, 313, 47 St.Rep. 277, 283. The length of the delay serves as a trigger for further analysis. Curtis, 787 P.2d at 313. The delay between Marquardt’s arrest and his first trial was 313 days. That length of time is sufficient to trigger further examination of his claim.

We next examine the reasons for the delay. Marquardt’s trial was originally set for October 3, 1988. That date was barely within 180 days of his arrest. All of the time prior to October 3, 1988, must be charged to the State, but no intentional delay has been shown.

The court, on its own motion because of a conflict of trial dates, reset trial to November 21. Marquardt’s change of venue motion and motion in limine were filed before the November 21 trial date (on October 27). Briefing, argument, and the decision on the motion for change of venue were not completed until January 17, 1989. Not all of that time, though, may be attributed to Marquardt. Some delay in the intervening months was caused by the retirement of Judge Chan Ettien. The time from January 17, 1989, to February 28, 1989, is chargeable to the State as institutional delay.

The State is responsible for a sizable portion of the delay before Marquardt’s first trial. However, the delay was largely institutional and not under the control of the prosecution. Because there is no indication that the delay was purposeful on the part of the State, it weighs less heavily than if it had been caused by the State’s oppressive tactics. State v. Ackley (1982), 201 Mont. 252 , 256, 653 P.2d 851, 853.

Marquardt asserted his right to a speedy trial in a timely manner by motion to dismiss on January 30, 1989. Therefore, the third element of a speedy trial analysis is met.

The interests protected by the right to speedy trial are prevention of oppressive pre-trial incarceration, minimizing the defendant’s anxiety and concern, and limiting impairment of the defense. Curtis, 787 P.2d at 315. Marquardt was incarcerated only sixteen days prior to trial. He asserts that his freedom of movement was hampered under the terms of his bail because he was required to call the Silver Bow County Sheriffs Office each day. However, we note that while he was out on bail prior to trial, he twice requested and was given permission to leave the State of Montana.

A certain amount of anxiety and concern is inherent in being accused of a criminal offense. State v. Waters (1987), 228 Mont. 490, 494, 743 P.2d 617, 620. Marquardt has not alleged any unusual anxiety or concern arising out of being accused of these charges.

Marquardt claims that his defense was impaired because of the delay in bringing him to trial. He states that a potential witness died between the time of the crime and the time of the trial. According to Marquardt, the owner of the car he was driving when he was arrested would have testified in his behalf, had that owner still been living at the time of trial. Marquardt does not explain what the owner would have testified to, so it is impossible to judge the prejudicial effect of the witness’s unavailability.

Marquardt also claims that loss of memory on the part of three victims of the robbery and on the part of a co-conspirator who testified against him impaired his defense. We find nothing in the record to substantiate this claim.

In sum, the delay before trial of this case was long, but it has not been shown to be purposeful on the part of the State. Marquardt asserted his right to speedy trial in a timely manner, but he has not shown any significant prejudice to his case resulting from the delay. On balance, we hold that Marquardt was not deprived of his constitutional right to a speedy trial.

Affirmed.

JUSTICES HARRISON, BARZ, SHEEHY, HUNT, WEBER, and McDonough concur.