text:
    L.E. SCARR a/k/a Robert Scarr, Plaintiff and Appellant, v. JAMES W. BOYER and Joann Boyer, Defendants and Respondents.
    No. 91-070.
    Submitted on briefs June 13, 1991.
    Decided Oct. 8, 1991.
    250 Mont. 248.
    818 P.2d 381.

      J. Reuss, Wright, Tolliver & Guthals, Billings, for plaintiff and appellant.
    James R Healow, Sweeney & Healow, Billings, for defendants and respondents.
   JUSTICE TRIEWEILER

delivered the opinion of the Court.

L.E. Scarr sued James and JoAnn Boyer to recover $70,000 due under a promissory note. The Boyers filed a counterclaim alleging usury. Both parties moved for summary judgment. The District Court for the Thirteenth Judicial District in Yellowstone County granted summary judgment for Scarr on the note itself and granted summary judgment for the Boyers on their counterclaim for usury. Scarr appeals from the order of the District Court. We affirm.

The issues are:

1. Did the District Court err in applying the usury penalty to a contractual provision for post-default interest?

2. Did the District Court err in applying the usury penalty to a contract in which the creditor did not intend to circumvent the usury statute?

In August 1983, Scarr sold subdivided land in Billings to Rim Creek Investors, a partnership that included defendant James Boyer. Scarr was given a mortgage on the property in the amount of $412,500. The partnership agreed to make annual interest payments. The balance of all remaining principal and interest was due on December 5, 1988. A dispute about foreclosure arose as the date of the balloon payment approached. By that time $375,000 of principal remained due. James Boyer and another partner went to Scarr’s residence in Washington and negotiated a compromise agreement.

Under the terms of this compromise, Scarr forgave $175,000 of principal in exchange for a $50,000 cash payment from the partnership and promissory notes from the individual partners for the remaining $150,000 of principal. The District Court treated this compromise agreement as a novation that canceled the earlier mortgage, and neither party appeals from that determination.

The Boyers’ individual share of the new principal debt was $70,000. They executed a note for that amount and agreed to pay interest at the rate of 10 percent prior to any default. The note provided that in the event of default, the interest rate would increase to 18 percent.

None of the partners made the first semi-annual interest payment when it was due on April 25, 1989. Scarr told the partnership he would accelerate the notes if he did not receive the first semi-annual interest payment by May 15,1989. On May 11,1989, the partnership tendered a check drawn on the partnership account for approximately one-half of the total amount of all the semi-annual interest due from all of the partners. Scarr returned this check and said he preferred to have payment from the partners as individuals.

On May 19,1989, Scarr accelerated the notes and filed suit against the individual partners. His complaint against the Boyers demanded all of the principal, plus 10 percent interest up to April 25, 1989, and 18 percent interest from that date forward. Specifically, Scarr demanded interest of $37.3687 for every day that elapsed after April 25, 1989. In their counterclaim the Boyers alleged that the post-default interest rate of 18 percent was usurious.

Both parties moved for summary judgment. The District Court granted summary judgment for Scarr on the note itself, but also granted summary judgment for the Boyers on their counterclaim. The penalty for usury is twice the amount of the usurious interest charges. Section 31-1-108, MCA. Five hundred and fourteen days elapsed between April 25, 1989, and the date during pre-trial proceedings when Scarr finally abandoned his claim to 18 percent interest. Pursuant to the statute, the District Court doubled the usurious post-default interest sought by Scarr and subtracted it from the $70,000 principal and $4,737.46 in non-usurious pre-default interest. Thus, the court reduced Scarr’s recovery by $38,415.02. He appeals.

I.

Did the District Court err in applying the usury penalty to a contractual provision for post-default interest?

In Montana, interest is “the compensation allowed by law or fixed by the parties for the use or forbearance or detention of money.” Section 31-1-104, MCA. Non-regulated lenders cannot charge more than six percentage points above the New York prime rate as reported in the Wall Street Journal three business days before the transaction in question. Section 31-1-107, MCA.

Usury is “[t]he taking, receiving, reserving, or charging” of an interest rate greater than the limit set by § 31-1-107, MCA. Section 31-1-108, MCA. The New York prime rate was 10.5 percent three days before the Boyers signed their promissory note. Thus, the maximum allowable interest rate applicable to the Boyer note was 16.5 percent.

However, Scarr argues that we should not apply the usury statute to the 18 percent post-default interest rate because it is merely a late-payment penalty that the Boyers could have avoided by paying on time. He cites the cases collected in 28 A.L.R.3d 449 for the proposition that post-default interest is not subject to usury statutes. In Metro Hauling, Inc. v. Daffern (1986), 44 Wash. App. 719, 722, 723 P.2d 32, 33, for example, the court said:

“[A] provision in a note by which the debtor agrees to pay, after maturity, interest at a rate higher than that allowed by law, does not render the transaction usurious provided the parties acted in good faith and did not intend to evade the usury law. The debtor has it within his power to avoid the additional interest charge by prompt payment of his obligation, and therefore, the contingency upon which the excessive interest comes into existence is not solely within the lender’s control.” [Citation omitted.]

Scarr assures us that this is by far the majority rule. But in Washington, the usury statutes apply to “every loan or forbearance of money.” Wash. Rev. Code § 19.52.010. Montana, by contrast, makes its usury statutes applicable to “detentions” of money as well as loans and forbearances. Section 31-1-104, MCA. We find this difference significant.

In Parks v. Lubbock (1899), 92 Tex. 635, 51 S.W. 322, the court construed a statute that was virtually identical to Montana’s present statutory definition of interest. The court held that:

“The detention of money arises in a case when a debt has become due, and the debtor withholds its payment, without a new contract giving him a right to do so .... [T]he conclusion is not to be resisted that there was a purpose in adding the word ‘detention’ to the accepted definition of ‘interest,’ and that this purpose was to meet the case when the debtor should detain the money owed beyond the stipulated period of forbearance, and so to provide that a promise to pay an additional sum for such detention should be deemed interest, and not merely damages by way of a penalty to secure a prompt performance of the contract.” [Emphasis added.]

Parks, 51 S.W. at 323. The court concluded that the post-default interest at issue in that case was subject to the usury statutes.

The Supreme Court of South Dakota reached the same conclusion in Ulvilden v. Sorken (1931), 58 S.D. 466, 237 N.W. 565. The statutory definition of interest in South Dakota, like the statutes in Texas and Montana, covered the “detention of money.” The court cited Parks with approval and added that:

“Requiring the maker of a note to pay a higher rate of interest after maturity for the use of money is likely to be as oppressive as when required to pay a higher rate during the term of the loan. It may not be within the power of the borrower promptly to meet his obligations at maturity. If a borrower is to be protected from the extortion of an excessive rate for the use of money, there is no apparent reason why it should be limited to the term of the loan.”

Ulvilden, 237 N.W. at 566.

We agree. Usury statutes protect borrowers who lack real bargaining power against overreaching by creditors. Daffern, 723 P.2d at 34. The occurrence of a default in no way affects this public policy in favor of protecting the debtor. Indeed, it is after default that the debtor has the greatest need for protection; a debtor who cannot retire a debt compounded by legal interest certainly lacks the resources to pay usurious interest.

For these reasons, we adopt the reasoning of the Texas and South Dakota courts and hold that Montana’s statutory definition of interest includes post-default interest. Scarr charged the Boyers post-default interest in excess of Montana’s statutory limit. This was usury. We conclude that the District Court was correct in applying the usury penalty.

II.

Did the District Court err in applying the usury penalty to a contract in which the creditor did not intend to circumvent the usury statute?

Scarr argues that it would be inequitable to penalize him for usury because he did not intend to violate the usury statute. He admits that it was his idea to charge 18 percent, but asserts that he only wanted to charge as much interest as the law would allow. He says he did not know what the usury limit was in Montana and that not even the partnership or its attorney realized that the post-default interest provision was usurious.

We disagree. The only intent required for usury is the intent to charge a particular rate of interest that is usurious in fact. Montana National Bank of Bozeman v. Kolokotrones (1975), 167 Mont. 92, 535 P.2d 1017. The creditor need not know that the particular interest rate is usurious and illegal. Thus, whether Scarr intended to violate the law is irrelevant. It is enough that he intended to charge 18 percent. We hold that the District Court was correct in penalizing Scarr for usury despite his assertions that he did not intend to violate the law.

Affirmed.

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


source: Caselaw Access Project

author: JUSTICE TRIEWEILER

license: Public Domain

text:
    THE STATE OF MONTANA, Plaintiff and Appellant, v. LARRY T. MOORE, Defendant and Respondent.
    No. 91-290.
    Submitted on briefs Sept. 5, 1991.
    Decided Oct. 8, 1991.
    250 Mont. 254.
    818 P.2d 835.

      Marc Racicot, Atty. Gen., Elizabeth Griffing, Asst. Atty. Gen., Helena, Robert Brown, Asst. Atty. Gen., Mike Salvagni, County Atty., Marty Lambert, Deputy County Atty., Bozeman, for plaintiff and appellant.
    James H. Goetz and Brian K. Gallik, Goetz, Madden & Dunn, Larry Jent, Williams, Jent & Dockins, Bozeman, for defendant and respondent.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

On December 17,1990, the State of Montana filed an Information in the District Court for the Eighteenth Judicial District in Gallatin County, charging defendant Larry Moore with Deliberate Homicide. On February 8,1991, the State amended its Information to add two counts of Tampering With or Fabricating Evidence. Moore then moved to suppress two taped interviews with law enforcement officers. On April 12, 1991, the District Court granted Moore’s motion in part. The court reserved its ruling, however, on whether the State could use the suppressed evidence for impeachment. The State appeals the order of the District Court. We affirm.

The issues are:

1. Did the District Court err in suppressing all reference in a legal interview to Moore’s statements in an earlier illegal interview?

2. Did the District Court err in refusing to rule on whether the State could use the suppressed evidence for impeachment?

Brad Brisbin, a resident of West Yellowstone, disappeared on November 9, 1990. The State’s search for Brisbin focused on Moore, who was the last person known by authorities to have seen Brisbin alive.

Members of the Gallatin County Sheriff’s Office interviewed Moore on November 23, 1990. Moore was alone, unaccompanied by counsel. The officers informed Moore of his rights under Miranda v. Arizona (1966), 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694. As required by Miranda, the officers told Moore that he had the right to remain silent, that anything he said could be used against him, that he had the right to a retained or appointed attorney, and that he could stop talking and assert his rights at any time.

The officers then began the interview by telling Moore they had a search warrant for his camper and wanted him to tell them what they would find in it. Almost immediately, Moore attempted to exercise his Fifth Amendment right to terminate the interview, but the questioning continued. Later in the interview, Moore specifically asked to talk to an attorney. The questions continued.

After this second unsuccessful attempt to invoke his Fifth Amendment rights, Moore told the officers that he had shot a rat in his camper and suggested that they would find bullet holes and possibly bullet fragments when they searched the camper. He also offered to give the authorities the pistol he used to shoot the rat. Later Moore asked a third time for an attorney. The interview ended after this third attempt by Moore to assert his Fifth Amendment rights.

A West Yellowstone police officer then drove Moore home, retrieved the pistol, and left. Later that night, Moore voluntarily returned to the West Yellowstone police station in search of personal property he had left in the patrol car. When Moore arrived at the police station, Gallatin County Sheriff Ron Cutting continued to question him about the rat shooting story. Sheriff Cutting did not re-issue the Miranda warnings. The sheriff asked Moore to diagram the rat shooting incident, and Moore complied.

On December 1, 1990, the authorities interviewed Moore again. This time Moore was accompanied by counsel. No Fifth Amendment violations are alleged to have occurred during this third interview. Pursuant to his attorney’s advice, Moore admitted that he had lied about shooting rats in his camper. He explained that he had found Brisbin in the camper armed with a pistol and in a suicidal state. Moore said he and Brisbin wrestled for the gun and it discharged, grazing Brisbin’s head and wounding him superficially. According to Moore, Brisbin made him promise not to tell anyone what had happened. He left to get water to clean Brisbin up and when he returned, Brisbin was gone.

Moore’s motion to suppress included the November 23, 1990, interview, the pistol, the rat shooting diagram, and the December 1, 1990, interview. The State opposed that motion, but asked the court to rule specifically that any evidence suppressed from the State’s case in chief would still be admissible for impeachment. The court suppressed all of the November 23, 1990, interview, the diagram, and any reference in the December 1, 1990, interview to the illegal November 23,1990, interview. The court took the matter of impeachment under advisement.

I.

Did the District Court err in suppressing all reference to the illegal November 23, 1990, interview in the subsequent legal December 1, 1990, interview?

The State does not contest the suppression of the November 23, 1990, interview. That interview is clearly inadmissible because the interrogating officers did not respect Moore’s assertion of his Fifth Amendment rights. See Edwards v. Arizona (1981), 451 U.S. 477, 101 S.Ct. 1880, 68 L.Ed.2d 378. Instead, the State argues that all of the December 1, 1990, interview is admissible, including the references to the November 23, 1990, interview.

In discussing the December 1, 1990, interview, the District Court ruled:

“It cannot be said this interrogation was ‘fruit of the poisoned tree,’ i.e., the interview of November 23,1990: the matters discussed were not identical; there was no indication Defendant labored under any mental difficulties; Defendant had counsel in attendance; and there was no justification for Defendant to feel he was in a hopeless position. Therefore, the tests of State v. Allies, [190 Mont. 475,] 621 P.2d 1080 (1980) and In the Matter of R.P.S., [191 Mont. 275], 623 P.2d 964 (1981) are met, and this interrogation is admissible evidence. However, any reference[ ] in this interrogation to any matter within the November 23, 1990, interrogation ... is tainted and must remain inadmissible.”

The District Court was correct: nothing in the December 1, 1990, interview, other than the references to the November 23, 1990, interview, could have been fruit of the poisoned tree. We hold, however, that, under the facts of this case, references to the November 23, 1990, interview are simply inadmissible in their own right, without reference to the poisoned tree doctrine.

We are aware of the “independent source” exception to the fruit of the poisoned tree doctrine. In Wong Sun v. United States (1963), 371 U.S. 471, 487-88, 83 S.Ct. 407, 417 9 L.Ed.2d 441, 455, the United States Supreme Court said:

‘We need not hold that all evidence is ‘fruit of the poisonous tree’ simply because it would not have come to light but for the illegal actions of the police. Rather, the more apt question in such a case is ‘whether, granting establishment of the primary illegality, the evidence to which instant objection is made has been come at by exploitation of that illegality or instead by means sufficiently distinguishable to be purged of the primary taint.’ ” [Emphasis added.]

In In re R.P.S. (1981), 191 Mont. 275, 623 P.2d 964, we noted that the following factors are relevant to determining whether derivative evidence has been “purged of the primary taint”: passage of time, change in location, manner of interrogation, representation by counsel, defendant’s mental condition, police conduct, opportunity to talk with family and friends, and whether the defendant believes the first confession or admission has made the defendant’s present position hopeless. R.P.S., 623 P.2d at 968. The State argues that the presence of several of these factors in this case purges the taint of the November 23, 1990, Miranda violations and renders the December 1, 1990, interview admissible in its entirety.

The State misapprehends the problem. References to the November 23, 1990, interview are not “fruit” of the poisoned tree — they are the poisoned tree itself. Law enforcement officers violated Moore’s Fifth Amendment rights. The exclusionary rule dictates that the product of those violations is inadmissible. It makes no sense to suppress the November 23, 1990, interview and then admit that evidence by allowing reference to it in another discussion.

Moore’s December 1,1990, admission that he lied on November 23, 1990, did not occur in a vacuum. Any mention at trial of the rat shooting story, or even Moore’s own admission that he had lied earlier in the investigation of the case, would inevitably resurrect the suppressed November 23, 1990, interview itself. Thus, questions of “independent sources” and “sufficiently distinguishable approaches” are irrelevant to this particular fact situation. We hold that the District Court was correct in suppressing all references to the November 23, 1990, interview from the December 1, 1990, interview.

II.

Did the District Court err in refusing to rule on the admissibility of the suppressed evidence for the purpose of impeachment?

The State asked the District Court to rule specifically that it could use Moore’s November 23, 1990, statements for impeachment, despite the suppression of those statements from its case in chief. In the District Court, the State cited Oregon v. Hass (1975), 420 U.S 714, 95 S.Ct. 1215, 43 L.Ed. 2d 570, and State v. Cartwright (1982), 200 Mont. 91, 650 P.2d 758, for the proposition that impeachment is a collateral use to which the exclusionary rule does not apply. The District Court took the matter under advisement.

The State now asks this Court to intervene and rule on the basis of Hass, Cartwright, and the limited pre-trial record in this case that the evidence is admissible for impeachment purposes. Moore, on the other hand, asks us to intervene on his behalf by rejecting the federal and state cases on independent and adequate state grounds.

Essentially, both parties ask us to compel the District Court to rule on this issue prior to trial. We decline that invitation. The impeachment issue is not properly before us until the District Court has entered a ruling.

The State argues that the District Court’s refusal to rule on this issue deprived it of its right to appeal suppression rulings under § 46-20-103, MCA. That statute provides:

“Scope of appeal by state. (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:
“(a) dismissing a case;
“(b) modifying or changing the verdict...;
“(c) granting a new trial;
“(d) quashing an arrest or search warrant;
“(e) suppressing evidence;
“(f) suppressing a confession or admission;
“(g) granting or denying change of venue; or
“(h) imposing a sentence that is contrary to law.”

[Emphasis added.]

Section 46-20-103, MCA. We note that nothing in this statute expressly guarantees the State the right to have the District Court enter its suppression ruling in time to perfect an appeal.

In anticipation of this problem, the State cites the following language in State v. Carney (1986), 219 Mont. 412, 418, 714 P.2d 532, 536:

“The objection was sustained by the District Court. These facts do not suggest a plain and obvious case warranting an appeal, nor do they describe an urgent circumstance. The prosecution had an adequate opportunity to present the question of admissibility in a pretrial motion. They did not eocercise that choice.” [Emphasis added.]

From this language, the State concludes that it is entitled to a pre-trial ruling any time it presents pre-trial motions on admissibility. However, we note that this was dicta, and that we did not indicate that the State could appeal from such an order. Furthermore, rulings on impeachment evidence cannot, by their nature, always be made prior to trial.

Moore, by contrast, likens the State’s pre-trial motion in the District Court to a motion in limine. We agree. The power to grant or deny such motions lies within the sound discretion of the District Court. See Wallin v. Kinyon Estate (1974), 164 Mont. 160, 519 P.2d 1236. In the instant case, the District Court held that:

“[I]t is far too early to decide what evidence may be used to impeach a witness who is not required to testify, and who may not testify. That matter is better left to the time of trial, and is considered as ‘under advisement.’ ”

We hold that this was within the scope of the District Court’s discretion and that the District Court did not abuse that discretion.

Affirmed.

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


author: CHIEF JUSTICE TURNAGE

text:
    LLOYD R. DONAHUE, Plaintiff and Appellant, v. CONVENIENCE DISPOSAL, INC., A Montana Corp., and Sue Ann Haggerty, Defendants and Respondents.
    No. 91-049.
    Submitted on briefs July 25, 1991.
    Decided Oct. 9, 1991.
    250 Mont. 261
    818 P.2d 839.

      Paul L. Frantz, Morrow, Sedivy & Bennett, Bozeman, for plaintiff and appellant.
    J. Robert Planalp, Landoe, Brown, Planalp & Braaksma, Bozeman, for defendants and respondents.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Lloyd R. Donahue (Donahue) appeals an order of the District Court for the Eighteenth Judicial District, Gallatin County, which denied Donahue’s motion for leave to file a second amended complaint and granted Convenience Disposal, Inc., and Sue Ann Haggerty’s (collectively referred to as Defendants) motion to dismiss or in the alternative, motion for summary judgment. We affirm.

Donahue presents the following issues on appeal:

1. Did the District Court err in denying Donahue’s motion to file a second amended complaint?

2. Did the District Court err in granting Defendants’ motion to dismiss or, in the alternative, motion for summary judgment?

In November 1983, Donahue worked as a garbage collector for Convenience Disposal, Inc. (Convenience), a garbage collection company located in Bozeman, Montana. Sue Ann Haggerty (Haggerty) was an officer and shareholder of Convenience.

Donahue sustained two injuries while in the course and scope of his employment with Convenience. On November 10 or 11, 1983, Donahue injured his back when he bent over to retrieve loose garbage under a garbage dumpster while he was positioned behind a garbage truck. A co-worker was inside the garbage truck and was mechanically lifting the garbage dumpster at the time of Donahue’s injury. The co-worker testified that he was uncertain if this accident occurred. Donahue missed no work time and filed no claim following this incident.

On November 15,1983, Donahue jumped off the back of a garbage truck, twisted his back, and hit his head against the garbage truck’s metal support railing. The garbage truck was being driven by a co-worker at the time of Donahue’s injury. Donahue missed work time following this incident.

Following the November 15th incident, Donahue filed a claim with the State Compensation Insurance Fund. In November 1983, Convenience was an uninsured employer under § 39-71-501, MCA; accordingly, Donahue’s claim was referred to the Uninsured Employers’ Fund. The Uninsured Employers’ Fund did not have adequate funds at this time.

On July 12, 1984, Donahue filed with the District Court a complaint against Haggerty d/b/a Convenience to recover damages for his November 15th injury under § 39-71-508, MCA (1983). On January 13, 1986, Donahue filed an amended complaint against the Defendants. Donahue’s amended complaint alleges in pertinent part:

“II.
“That during the course and scope of Plaintiffs [sic] employment with Defendant, and on or about November 10 or 11, 1983, the Plaintiff herein while in the course and scope of his employment did sustain an injury while bending down to pick up loose garbage under a garbage dumpster which was being mechanically lifted by the garbage truck and being operated by a co-employee, said garbage dumpster was lowered onto Plaintiff’s back.
“HI.
“That the Plaintiff as a result of said accident which occurred on or about November 10 or 11, 1983, did sustain an injury to his back, but was able to return to his employment with the Defendant, Convenience Disposal, Inc.
“IV.
“That on November 15, 1983, while in the course and scope of his employment with Defendant, Convenience Disposal, Inc., the Plaintiff herein twisted his back jumping off the back of a garbage truck and in addition to twisting his back, said Plaintiff hit the back of his head against a metal support railing as located on said garbage truck.”

The amended complaint further prays for damages and attorney fees regarding Donahue’s November 10th or 11th and November 15th injuries under §§ 39-71-509 and -515, MCA (1985).

A jury trial was scheduled for September 24, 1990. During a pretrial conference on September 7, 1990, the District Court Judge advised counsel of his legal analysis regarding this case:

“[T]he first issue of law I see — Can the Plaintiff recover under 39-71-515? My answer to that is no. The reason is that statute wasn’t passed until 1985, and the accident occurred in 1983. There’s nothing in the statute that says that it is to be applied retroactively. I think this brings into play Boehm v. Alanon Club, 722 P.2d 1160, where [the court] held that 515 cannot be applied retroactively and does not apply to injuries which occurred prior to 1985.
“Now the next one is, number two, Can the Plaintiff recover attorney fees[?] And my answer to that is no. The reason is because Sec. 39-71- 515 does not apply to this case.
“Now question number three is — Can the Plaintiff recover for the accident described beginning in Paragraph (4) of Count I of the Complaintf?] That’s the accident that occurred November 15, 1983.. As I see it now, the answer is no. It says the Plaintiff’s alleged injury occurred from jumping off the back of the truck and he twisted his back. No allegation of negligence on the part of the Defendant or any co-employee [was alleged in the Complaint]. And without negligence I don’t think a regular suit for damages applies.
“Number four — Can a Plaintiff recover for injuries resulting from the accident on November 10 or 11, 1983? That’s when the garbage dumpster was lowered on his back. The answer is yes if the Plaintiff can show that the co-employee was negligent and that that negligence proximately caused the Plaintiff’s injuries. However, from reading the Complaint it appeared that you might have trouble proving injuries, or damages, from that accident, because after that accident the Plaintiff went right back to work and worked until the second accident, which was November 15, 1983.
“Now the fifth issue that I see — Can the Plaintiff pursue a claim for benefits from unsecured employers’ fund and also maintain a damage action against the Defendant in accordance with 39-71-509. The answer is no, because again, we must apply 509 and also 508, the companion statute, as it existed prior to the 1985 amendment, and that’s governed by Boehm v. Alanon Club which I previously cited. And prior to the 1985 amendment, 508 provide[s] ‘the injured employee may not receive both benefits from the fund and pursue a damage action.’ The statute prior to 1985, that is 39-71-508 also specifically required the Plaintiff to elect between the two remedies. In this case it seems to me that at the time of the filing of the Complaint he elected to not pursue the uninsured employers’ fund case but to rely on the damage action pursuant to 509. In fact, that’s what the Complaint specifically says.”

On September 14,1990, ten days before the jury trial was to begin, Donahue moved the District Court for leave to file a second amended complaint. On September 14, 1990, the Defendants moved the District Court to dismiss this case or, in the alternative, grant summary judgment. In an order dated September 20, 1990, the District Court denied Donahue’s motion for leave to file a second amended complaint holding that its filing “would materially change the issues of the first case in the midst of trial, at least close to trial, and would unduly prejudice the Defendants.” The District Court further granted the Defendants’ motion to dismiss or, in the alternative, motion for summary judgment. From this order, Donahue appeals.

1. Did the District Court err in denying Donahue’s motion to file a second amended complaint?

Montana Rule of Civil Procedure 15(a) provides in pertinent part: “a party may amend his pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given when justice so requires.” Furthermore, this Court has held:
“In the absence of any apparent or declared reason — such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, futility of amendment, etc. — the leave sought should, as the rules require, be ‘freely given.’ ” [Emphasis added.] Prentice Lumber Co. v. Hukill (1972), 161 Mont. 8, 17, 504 P.2d 277, 282 (citing Foman v. Davis (1962), 371 U.S. 178, 83 S.Ct. 227, 9 L.Ed.2d 222).

Donahue argues that his amended complaint sufficiently alleges that Defendants’ negligence proximately caused Donahue’s injuries. Donahue further argues that he sought leave from the District Court to file a second amended complaint only to clarify these allegations of negligence.

We hold that the District Court properly stated in the pretrial conference and later held in its September 20, 1990, order that Donahue’s amended complaint did not allege that Defendants’ negligence proximately caused Donahue’s injuries. Accordingly, Donahue’s second amended complaint was an attempt to introduce a new cause of action based on negligence against the Defendants’ ten days prior to trial. The District Court denied Donahue leave to file the second amended complaint holding that its filing “would materially change the issues of the first case in the midst of trial, at least close to trial, and would unduly prejudice the Defendants.”

In Yellowstone Conference of the United Methodist Church v. D.A. Davidson, Inc. (1987), 228 Mont. 288, 741 P.2d 794, the plaintiff moved to amend its complaint to include a new cause of action, a securities fraud claim. This Court held that this amended complaint “offered after four years of discovery and two weeks prior to trial” would have unduly prejudiced the defendants and was properly denied by the District Court. Yellowstone Conference of the United Methodist Church, 228 Mont. at 293, 741 P.2d at 798.

Here, Donahue’s second amended complaint, which also included a new cause of action, was offered over six years after Plaintiff’s original complaint was filed, four years after our decision in Boehm v. Alanon Club (1986), 222 Mont. 373, 378, 722 P.2d 1160, 1163, and ten days prior to trial. The question of permitting amendments to pleadings is one addressed to the sound judicial discretion of the trial court. Before we will hold a refusal of leave to amend to have been error, appellant must show an abuse of discretion. Cullen v. W.P. Mtg. & Warranty Title Co. (1913), 47 Mont. 513, 134 P. 302. We conclude that there has been no showing that the trial court abused its discretion when it denied the Plaintiff’s second motion to amend his complaint under these circumstances. We therefore hold that the District Court properly denied Donahue leave to file a second amended complaint.

2. Did the District Court err in granting Defendants’ motion to dismiss or, in the alternative, motion for summary judgment?

Donahue argues that the Defendants’ motion to dismiss or, in the alternative, motion for summary judgment was not timely filed under Montana Rule of Civil Procedure 12(b) and the District Court’s scheduling order. Donahue further argues that even if the Defendants’ motion was timely filed, the District Court erred in dismissing this action because Donahue should have been allowed to proceed to trial on the alleged November 10th or 11th accident pursuant to Judge Langen’s remarks at the pretrial conference. Donahue further argues that the District Court’s September 20,1990, order is ambiguous as it appears to grant both Defendants’ motion to dismiss and motion for summary judgment.

In reviewing the District Court’s September 20, 1990, order, we agree that it appears that this order granted both Defendants’ motion to dismiss and motion for summary judgment. We hold that in this case, the granting of summary judgment in the Defendants’ favor was appropriate. Accordingly, we will not discuss Donahue’s argument regarding Montana Rule of Civil Procedure 12(b), as it does not apply to summary judgment.

Here, the applicable rule concerning motions for summary judgment is Montana Rule of Civil Procedure 56. Montana Rule of Civil Procedure 56(b) provides that “a party against whom a claim, counterclaim, or cross-claim is asserted or a declaratory judgment is sought may, at any time, move with or without supporting affidavits for a summary judgment in his favor as to all or any part thereof.” Therefore, the timeliness of Defendants’ motion for summary judgment is not an issue.

Montana Rule of Civil Procedure 56(c) provides that a motion for summary judgment shall be granted “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Here, the District Court properly stated in the pretrial conference and later held in its September 20, 1990, order that Donahue’s amended complaint is fatally flawed. First, it is based on § 39-71-515, MCA, a statute enacted in 1985. Donahue’s accidents and sustained injuries occurred in 1983. This Court has previously held that § 39-71-515, MCA, cannot be applied retroactively, and does not apply to accidents that occurred prior to 1985. Boehm v. Alanon Club (1986), 222 Mont. 373, 378, 722 P.2d 1160, 1163. Second, as previously discussed, Donahue’s amended complaint does not allege that his accidents were proximately caused by the negligence of the Defendants. Accordingly, Donahue’s amended complaint fails to present a genuine issue for trial, and the Defendants are entitled to judgment as a matter of law. We therefore hold that the District Court properly granted summary judgment in this instance.

Affirmed.

JUSTICES HARRISON, TRIEWEILER, HUNT and McDonough concur.


author: JUSTICE HUNT

text:
    DARRELL D. RAFFETY, Claimant and Appellant, v. KANTA PRODUCTS, INC., Employer, and STATE COMPENSATION INSURANCE FUND, Defendant and Respondent.
    No. 90-542.
    Submitted on briefs Oct. 10, 1991.
    Decided Oct. 29, 1991.
    250 Mont. 268.
    819 P.2d 1272.
    Greg J. Skakles, Johnson, Skakles & Kebe, Anaconda, for claimant and appellant.
    Thomas E. Martello, Hughes, Kellner, Sullivan & Alke, Helena, for defendants and respondents.
   JUSTICE HUNT

delivered the opinion of the Court.

Claimant Darrell D. Raffety appeals from a judgment of the Workers’ Compensation Court issued on October 10, 1990, which found that he was only entitled to 140 weeks of permanent partial disability benefits for injury to one eye, instead of 500 weeks, as claimant argued. We affirm.

The sole issue presented for review by the parties is whether the Workers’ Compensation Court erred in limiting claimant’s award of permanent partial disability benefits for injury to one eye to 140 weeks.

On October 17,1983, claimant suffered an injury arising out of and in the course of his employment. Claimant was struck in the right eye by a nail while he was nailing sheet metal to a storage shed, resulting in loss of vision in the eye. At the time of claimant’s injury, his employer was insured under Plan III of the Workers’ Compensation Act. A claim for compensation was filed with insurer, the State Fund, which accepted liability for the injury. Insurer, in addition to paying medical and temporary total disability benefits, paid 140 weeks of permanent partial disability benefits at the rate of $138.50 per week.

On August 31,1989, claimant petitioned the Workers’ Compensation Court for permanent partial disability benefits in excess of the 140 weeks paid by the insurer. This petition was filed after the insurer refused to entertain a petition for benefits in excess of 140 weeks. Claimant contended he was entitled to 500 weeks of benefits, minus the 140 weeks previously paid by the insurer. Inasmuch as the dispute between the parties involved a question of law only, the matter was submitted to the Workers’ Compensation Court on an agreed statement of facts and briefs by the parties. On October 10, 1990, the Workers’ Compensation Court issued its decision holding that the statutes governing permanent partial disability benefits were clear and unambiguous and limited the claimant to 140 weeks of benefits. It is from this judgment that claimant appeals.

Both parties stipulated that the present dispute involved only a question of law. In reviewing conclusions of law, this Court will not apply the substantial credible evidence standard used in reviewing factual findings of the Workers’ Compensation Court. Concerning this Court’s review of conclusions of law by the Workers’ Compensation Court, we recently stated:

“In such a case, the appropriate standard of review is simply whether the lower court’s interpretation of the law is correct. We are not bound by the lower court’s conclusion and remain free to reach our own.”

Schaub v. Vita Rich Dairy (1989), 236 Mont. 389, 391, 770 P.2d 522, 523. Additionally, concerning our review of conclusions of law, we have stated:

“The reasoning for simply determining if the court’s conclusions are correct is that no discretion is involved when a tribunal arrives at a conclusion of law — the tribunal either correctly or incorrectly applies the law. For that reason, this Court concludes that our standard of review relating to conclusions of law, whether the conclusions are made by an agency, workers’ compensation court, or trial court, is whether the tribunal’s interpretation of the law is correct.” Steer, Inc., v. Department of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d 601, 603. The instant case deals with a conclusion of law, and, therefore, upon review, we will simply determine whether the conclusion was or was not correct.

At issue in this case is the Workers’ Compensation Court’s interpretation of §§ 39-71-703 and 705, MCA (1983), concerning compensation for injuries causing partial disability. Section 39-71-703, MCA, has undergone significant modification in virtually every legislative session since 1983, and § 39-71-705, MCA, has been repealed. However, it is well-settled that the law existing at the time of the injury governs. Watson v. Seekins (1988), 234 Mont. 309, 312, 763 P.2d 328, 331. Claimant’s injury occurred in 1983. Section 39-71-703, MCA (1983), reads as follows:

“(1) Weekly compensation benefits for injury producing partial disability shall be 66%% of the actual diminution in the worker’s earning capacity measured in dollars, subject to a maximum weekly compensation of one-half the state’s average weekly wage.
“(2) The compensation shall be paid during the period of disability, not exceeding, however, 500 weeks in cases of partial disability. However, compensation for partial disability resulting from the loss of or injury to any member shall not be payable for a greater number of weeks than is specified in 39-71-705 for the loss of the member.” [Emphasis added.]

Section 39-71-705, MCA (1983), contains a schedule of injuries to various members of the body and a corresponding maximum duration of compensation available for each such injury and reads, in part, as follows:

“(1) In addition to temporary total disability benefits allowed in this chapter, indemnity benefits for loss of a member shall be paid at the weekly rate provided in 39-71-703 and shall be paid for the following periods:
“Total blindness of one eye ... 140 weeks ...”

Claimant points out that at the time ofinjury, §39-71-104, MCA (1983), mandated that the Worker’s Compensation Act be liberally interpreted. We construed this section to require that when a statute in the Act “is open to more than one interpretation, one favorable to the employee and the other against him, we must give it the construction most favorable to the injured workman ... .” Geary v. Anaconda Copper Mining Co. (1947), 120 Mont. 485, 489, 188 P.2d 185, 186. The claimant contends that the statutes in question may be interpreted as allowing for 500 weeks of permanent partial disability benefits for the loss of an eye. We disagree. The Workers’ Compensation Court was correct in determining that the statutes in question are clear and unambiguous on this point.

Section 39-71-703, MCA, provides that compensation for partial disability “shall not be payable for a greater number of weeks than is specified in 39-71-705 ....” Section 705 unambiguously sets the maximum period for permanent partial benefits for loss of an eye at 140 weeks. The decision of the Workers’ Compensation Court that the statute clearly precludes compensation in excess of 140 weeks for the loss of an eye is correct. Additionally, the interpretation of the statute by the Workers’ Compensation Court is in accordance with the existing case law construing these statutes. In a case very similar to the present controversy, this Court held that for the loss of vision to one eye, an injured worker is limited to 140 weeks of permanent partial disability benefits. Johnson v. Industrial Accident Board (1971), 157 Mont. 221, 483 P.2d 918. In Johnson, as here, the injured worker alleged he was entitled to 500 weeks of permanent partial benefits. The Court in Johnson held that the legislative intent was clear that an injured worker was limited to the maximum number of weeks of benefits, as was indicated by the statutory schedule of injuries. This Court has consistently held that an individual with a scheduled injury is limited to the benefits set out in the schedule. Walter v. Public Auction Yards (1979), 181 Mont. 109, 592 P.2d 497. As we explained in McDanold v. B.N. Transport, Inc. (1984), 208 Mont. 470, 477, 679 P.2d 1188, 1192:
“The 500-week limit is simply a statutory maximum period for such compensation. The Legislature has further limited this period of disability to the number of benefit weeks for the comparable schedule injury under sections 39-71-705 - 708, MCA, but only when the injury is specifically listed in the schedule.”

Claimant presents two arguments in support of his contention that the above-mentioned cases were decided incorrectly by this Court. First, claimant argues that our later decisions concerning this issue are inconsistent with our prior opinion in Spieth v. Stuart (1956), 130 Mont. 216, 299 P.2d 166. In Spieth, we upheld the award of500 weeks of permanent partial disability benefits for a scheduled injury. The insurer argued that the injured worker should be limited to 37 weeks, as provided in the schedule. Spieth is not persuasive authority for claimant in the present case in that the statute in effect at the time of Spieth is dramatically different than the statute before us now. The statute interpreted in Spieth limited scheduled injuries to a particular dollar amount of compensation, but did not limit the scheduled injuries as to duration of compensation, as does the statute in question here. Had the last sentence of § 39-71-703(2), MCA (1983), been in effect at the time of Spieth, the opposite result would have been reached.

Claimant’s second argument in support of his contention that this Court has misinterpreted §§ 39-71-703 and -705, MCA, in the past is, in essence, an argument that the sections, as enacted, were neither fair nor wise. Further, claimant points out that other jurisdictions have not relied exclusively on such injury schedules for determining the duration of compensation benefits. Claimant argues forcefully that the statutes should have provided an option for injured workers to receive compensation for permanent partial disability based on impairment of earning capacity. It is argued that this would result in a fairer determination of the appropriate duration of compensation benefits than would relying on an arbitrary schedule of injuries and their corresponding benefits. Claimant’s policy argument may or may not be correct, but, in any event, this Court will not substitute its judgment for that of the legislature. The legislature adopted the statutes, and they are clear and unambiguous.

“[I]t is the province of courts to construe and apply the law as they find it and to maintain its integrity as it has been written by a coordinate branch of the state government. When the terms of the statute are plain, unambiguous, direct, and certain, it speaks for itself, and there is no room for construction.”

Bay v. Department of Administration (1984), 212 Mont. 258, 265, 688 P.2d 1, 4.

Finally, claimant argues that an eye is not generally understood to be a “member” and, therefore, the second sentence of § 39-71-703(2), MCA (1983), does not apply. Regardless of the various conflicting definitions of what constitutes a “member,” it is obvious that loss of an eye is a scheduled injury, as set out in § 39-71-705, MCA (1983).

The decision of the Workers’ Compensation Court is affirmed.

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


text:
    LEO BODILY, Petitioner and Appellant, v. JOHN JUMP TRUCKING, INC., Employer, and STATE COMPENSATION MUTUAL INSURANCE FUND, Defendant and Respondent.
    No. 90-561.
    Submitted on briefs May 16, 1991.
    Decided Oct. 29, 1991.
    250 Mont. 274.
    819 P.2d 1262.

      Darrell S. Worm, Ogle & Worm, Kalispell, for petitioner and appellant.
    Richard E. Bach, State Comp. Mut. Ins. Fund, Helena, for defendant and respondent.
   JUSTICE TRIEWEILER

delivered the opinion of the Court.

Claimant Leo Bodily filed a petition in the Workers’ Compensation Court to recover disability and medical benefits as a result of injuries he alleged he sustained during the course of his employment with John Jump Trucking, Inc. Following trial before the court’s hearing examiner, the court concluded as a matter of law that claimant failed to give adequate notice of his injury to his employer, as required by § 39-71-603, MCA (1985), and that claimant’s disability did not result from an injury, as defined in § 39-71-119(1), MCA (1985). From the judgment entered pursuant to those conclusions, claimant appeals. We reverse.

The issues which control our decision are the following:

1. Did claimant provide his employer with timely notice of his injury pursuant to § 39-71-603, MCA (1985)?

2. Did claimant sustain an injury within the meaning of § 39-71-119(1), MCA (1985), during the course of his employment with John Jump Trucking, Inc.?

FACTUAL BACKGROUND

In 1979, prior to his employment with John Jump Trucking (hereinafter referred to as “Jump”), claimant sustained severe injuries while operating a logging truck when a log rolled off the truck and landed on him. Robert Schimpff, M.D., a board-certified neurologist, who treated him at the hospital for that injury, diagnosed hemorrhaging into claimant’s cervical spine, a collapsed right lung, fracture of several ribs, fracture of his scapula, injury to several intervertebral discs in his lower back, internal injuries, and injuries to his right wrist and foot.

However, claimant recovered from those injuries sufficiently to go to work for Jump as a logging truck driver in March 1981. He worked for Jump continuously until taking a leave of absence for medical reasons on July 8, 1986.

Claimant testified that the only residual impairment that he was aware of from his 1979 accident was some loss of strength in his right arm. However, in December 1985, he began developing loss of strength in his left arm. Over the course of the next six months, his left-sided symptoms progressed from weakness to muscle spasms, cramps, and numbness in his lower left extremity, as well as his upper left extremity. Claimant testified that by July 8, 1986, he was experiencing terrible neck pain, loss of strength on his left side, and was so impaired by pain medication that he felt it was unsafe for him to continue operating a logging truck on the state’s highways. By July 8, 1986, he determined that he could not continue with his employment and asked his employer for permission to take leave from his job so that he could seek medical treatment for his condition.

Claimant testified that prior to leaving work on July 8, 1986, he met with his employer, John Jump, and explained that he felt it was unsafe for him to continue working due to his physical condition. He testified that he also recalls explaining to Jump that, although he felt reasonably comfortable upon arriving at work, within a couple of hours after getting into his truck and being exposed to the bouncing around that occurred from operating that truck on logging roads, he could no longer stand the pain. When the pain developed, he was forced to take Tylenol III with codeine.

After taking leave from his employment, claimant went to the Veteran’s Administration Center at Fort Harrison to be examined in an effort to determine the cause of his complaints. However, the VA Center had no neurology department, and, therefore, put him on a waiting list for an examination at the Veteran’s Administration Center in Salt Lake City, Utah. He was accepted at the VA Center in Salt Lake City on about July 21,1986, and was discharged on August 5, 1986. However, the physicians at the VA Center were unable to explain the physiological basis for claimant’s complaints and speculated that they may result from nerve root irritation or multiple sclerosis. Claimant’s multiple sclerosis had been diagnosed in 1969 and periodically through the years he had experienced neurological problems which he attributed to that condition.

Claimant testified that shortly after he returned from Salt Lake City, he arranged to meet his employer at a restaurant to explain what he had learned about his condition and to discuss a date for returning to work. He testified that during that meeting he explained to Jump that he did not know the cause of his symptoms but had been advised to rest, exercise, and try to rebuild his strength. Claimant testified that he explained to his employer at that time that, in his opinion, if he returned to his job, his condition would worsen.

John Jump testified that he recalled claimant taking time off from work in July 1986 and assumed that he had been given notice by claimant of the fact that he would not be coming to work and the reasons for his absence. However, he testified that he had no specific recollection of the explanation given to him by claimant for claimant’s leave of absence. He also recalled having a conversation with claimant in a cafe after his return from Salt Lake City but could not recall what was said during that conversation. He had no recollection of having been advised by claimant that he was having physical problems related to the performance of his job. However, he was unable to deny that claimant discussed those problems based on any specific recollection of his conversations with the claimant.

During his absence from employment, claimant testified that he was unable to rebuild the strength in either arm, but that the pain he had been experiencing while working subsided and that he eventually ran out of money. He called his employer and asked to return to work with a reduced work load. He did return to work on October 22, 1986.

For the first month after returning to work, claimant was given easier jobs which did not involve operating a logging truck on logging roads. His routes were limited to highway hauls, which did not involve as much jarring and jostling of his spine. However, after returning to his normal duties, his physical condition became progressively worse, and the pain which he had experienced prior to July 8, 1986, returned.

Claimant testified that during spring break-up in 1987, he again explained to his employer that a few hours after getting into and operating his truck, his pain would become intolerable. He testified that at that point he and Jump agreed that he could begin seeing a chiropractor for his neck pain. However, in spite of his efforts to obtain further treatment, claimant testified that by June 30, 1987, his left leg started to go numb while at work, and, by the time he returned home, his body had gone numb from the waist down. He remained in that condition until he terminated his employment with Jump in August 1987.

Claimant testified that when his symptoms would worsen, they would do so quickly. For example, when he lost strength in his left arm, that development occurred overnight. When he lost sensation in his left leg and lower body, that development occurred in the course of 24 hours. When pain would develop during the course of his employment, it would develop within hours after getting into and operating his logging truck.

On August4,1987, claimant returned to Dr. Schimpffwho feltthat, because of the earlier hemorrhaging in the area of claimant’s spinal cord, further neurological evaluation was warranted. Eventually, diagnostic studies illustrated arthritic development and stenosis in the area of claimant’s cervical spine which was compressing or displacing his spinal cord. It was Dr. Schimpff’s opinion that the condition for which he examined claimant in August 1987 was the same condition from which claimant was suffering when he left work and sought treatment on July 8,1986. Dr. Schimpff testified that, in his opinion, the original injury that had occurred in 1979 predisposed claimant to degenerative changes in his cervical spine which were accelerated by the repeated trauma to the spine associated with his activities driving a logging truck. It was also Dr. Schimpff’s opinion that without the traumas caused during the course of claimant’s occupation, the cervical stenosis which was responsible for his neurological symptoms may never have occurred, or would probably have occurred years later than it did develop.

Dr. Schimpff described the impact caused by claimant’s occupation as repetitive trauma which accelerated the degenerative changes in claimant’s spine.

He described the jolting and jarring that claimant experienced as a logging truck driver as small injuries which cumulatively became a substantial injury.

Dr. Schimpff also testified that, while the further degeneration of claimant’s spine occurred over the entire period that he worked for his employer, the onset of disabling symptoms from that physical condition could have occurred relatively suddenly.

As a result of his diagnosis, Dr. Schimpff referred claimant to Albert Joern, M.D., a neurosurgeon. Dr. Joern first examined claimant on September 14, 1987, and on September 18 of the same year, admitted claimant to the hospital where he performed a cervical discectomy and interbody fusion at three levels of claimant’s cervical spine.

Based upon what he found when he performed that surgery, and based upon his review of claimant’s diagnostic studies, it was also Dr. Joem’s opinion that the condition for which he operated on claimant was related to his employment as a logging truck driver. Dr. Joern explained that, during his operation, he observed severe degeneration at three levels of the cervical spine but that films which were taken of claimant’s neck in 1979 showed no such disc damage. From that, he was able to conclude that, between 1981 and 1987 these discs herniated.

Dr. Joern explained that, in his opinion, claimant had an injury to his neck in 1979 which did not produce a herniation, but which produced weakness or some internal disruption; and that due to claimant’s subsequent employment which involved bouncing around in a logging truck day after day, his neck was subjected to repeated stresses. He testified that, through a cumulative traumatic process over a period of three to four years, those discs were caused to bulge, scar down, calcify, and stabilize. In his opinion, the primary occupational factor that ultimately made surgery necessary for claimant was the bouncing associated with operating a logging truck over logging roads.

It was Dr. Joern’s opinion, however, that the symptoms associated with claimant’s worsened neurological condition appeared to have developed from late 1985 through mid-1986 when claimant presented at the VA Hospital with neurological impairment.

By the time Dr. Joern saw claimant in 1987, he considered his condition a medical emergency.

On November 17,1987, claimant filed his claim for compensation, alleging that he had been injured during the course of his employment and setting forth July 6, 1986, as the date of his injury.

The Workers’ Compensation Court’s findings of fact were less specific but not significantly different from those facts previously set forth in this opinion. However, that court concluded that as a matter of law the information given by claimant to his employer was not sufficient to satisfy the notice requirement of § 39-71-603, MCA (1985). The Workers’ Compensation Court concluded that there was not a statement by claimant to his employer of an injury related to his job which was sufficient to notify a reasonably prudent employer that there may be a potential compensation claim.

The Workers’ Compensation Court further concluded that claimant did not suffer an injury, as defined in § 39-71-119(1), MCA, because the period of time over which the injury occurred lacked sufficient time definiteness to qualify as an injury according to the previous decisions of this Court.

I

Did claimant provide his employer with timely notice of his injury pursuant to § 39-71-603, MCA (1985)?

The notice requirement in effect at the time of claimant’s injury was § 39-71-603, MCA (1985). It provided that:

“No claim to recover benefits under the Workers’ Compensation Act, for injuries not resulting in death, may be considered compensable unless, within 60 days after the occurrence of the accident which is claimed to have caused the injury, notice of the time and place where the accident occurred and the nature of the injury is given to the employer or the employer’s insurer by the injured employee or someone on the employee’s behalf. Actual knowledge of the accident and injury on the part of the employer or the employer’s managing agent or superintendent in charge of the work upon which the injured employee was engaged at the time of the injury is equivalent to notice.”

To conclude claimant’s notice to his employer was inadequate, the Workers’ Compensation Court relied on our decision in Reil v. Billings Processors, Inc. (1987), 229 Mont. 305, 746 P.2d 617. The scope of our review is to determine whether the decision in that case was correctly applied to the fact situation in this case. Therefore, the standard for review is to determine whether the trial court’s interpretation of the law, as applied to the facts in this case, is correct. Wassberg v. Anaconda Copper Co. (1985), 215 Mont. 309, 697 P.2d 909. In Reil, the claimant suffered from congenital deformities in both arms. Following several operations and various jobs, claimant was employed as a computer operator where he lifted boxes, unloaded computer tape reels, and performed light janitorial work. The work he did, as well as recreational activities that he performed, caused pain in his arms.

Reil occasionally complained to his employers about the pain that he experienced in his arms. However, we concluded that those complaints were insufficient to constitute notice under § 39-71-603, MCA, for the following reasons:

“However, Reil did not relate to his employers that this pain was as a result of his work-related duties. Reil’s employers assumed that his problems were merely the consequences of the congenital deformities. Reil did not ask to be reassigned to another position, nor did he request that his employers modify his duties to reduce the necessity for use of his arms and hands.”

Reil, 746 P.2d at 618.

We held that:

“The fact that Billings Processors knew Reil was experiencing pain, either taken alone or cumulatively with the other facts of this case, does not constitute actual knowledge. Accordingly, the lower court erred in finding that Billings Processors had actual knowledge of Reil’s alleged injury. We find that Billings Processors had no actual knowledge of either an injury or a job-induced aggravation of a preexisting condition in this case.”

Reil, 746 P.2d at 623.

The facts in this case are significantly different. According to claimant’s testimony, he did relate his pain and deteriorating physical condition to his employment. He explained that within two hours after getting into and operating his truck, the pain he experienced became extreme. He advised his employer, after being off work for a period of time, that his symptoms had improved, but that he was afraid to return to work too soon for fear of re-aggravating his condition. When claimant did return to work, he requested that he be allowed to avoid rough roads for awhile so as not to aggravate his condition; and, after returning to normal duties, he again informed his employer that within hours after entering and operating his truck, his physical condition was intolerable, and it was necessary to consume significant pain medication. Unlike Reil, claimant did associate his symptoms with his employment. He did take time off to recover from his injuries, and he did ask to modify his duties to avoid aggravation of his condition.

In Lee v. Lee (1988), 234 Mont. 197, 199, 761 P.2d 835, 837, we interpreted Reil to mean that, “[t]he employer must have notice that the claimant considers his injury work-related.” We relied on the following discussion from a leading treatise on workers’ compensation law:

“It is not enough, however, that the employer, through his representatives, be aware that claimant ‘feels sick,’ or has a headache, or fell down, or walks with a limp, or has a pain in his back, or shoulder, or is in the hospital, or has a blister, or swollen thumb, or has suffered a heart attack. There must in addition be some knowledge of accompanying facts connecting the injury or illness with the employment and indicating to a reasonably conscientious manager that the case might involve a potential compensation claim.”

3 Larson, Workmans’ Compensation Law, § 78.31(a)(2) pp. 15-126 to 15-136 (1988).

Lee, 761 P.2d at 837.

In this case, unlike the claimant in Reil, claimant provided his employer with all the information he had regarding the nature of his injury and its relationship to his employment. Claimant knew that he had neck, arm, and leg problems of unknown etiology which were made worse after performing his job duties for a short period of time. That is all he knew. According to claimant’s testimony, that is what he reported to his employer. By providing his employer with all the information he had regarding the nature of his injury, the period of time over which it occurred, and the nature of activity that contributed to or caused his condition, claimant did all that can be reasonably expected to comply with the notice requirement in § 39-71-603, MCA.

In this case, where there is a slowly-developing injury which does not lend itself to precise notification, the requirement of § 39-71-603, MCA (1985), is satisfied by giving the employer sufficient information to lead a reasonably conscientious person to conclude that there may be a connection between the worker’s condition and his job.

Claimant’s employer testified that he has no recollection of being told by claimant that his symptoms were related to his occupational duties. However, claimant’s employer does recall having conversations with claimant about his physical complaints. He simply could not recall the substance of those conversations at the time of trial. In a similar situation, we held in Harmon v. Deaconess Hospital (1981), 191 Mont. 275, 623 P.2d 1372, that:

“[T]he testimony of a witness that he does not remember whether a certain event or conversation took place does not contradict positive testimony that such event or conversation did take place.” [Citations omitted.]

Harmon, 623 P.2d at 1374.

Thus, claimant’s testimony regarding the substance of his conversations with his employer is uncontradicted.

We have previously held that:

‘We must liberally construe the Workers’ Compensation Act (§ 39-71-104, MCA), and there is probably no area more important to imply a liberal construction than on the question of whether sufficient notice was given of the accident.”

Ackerman v. Pierce Packing Co. (1983), 206 Mont. 508, 511, 672 P.2d 267, 269.

While § 39-71-104, MCA (1985), has since been repealed, we must apply the statutes to this case which were in effect on the date of claimant’s injury. Young Motor Co. v. Division of Workers’ Compensation (1985), 219 Mont. 1, 710 P.2d 58.

We conclude that claimant satisfied the notice requirement. Since claimant’s disability was the result of cumulative traumas which occurred over a period of time, the date of injury, for purposes of complying with the notice requirement, is the date on which claimant was first unable to continue with his employment due to his physical condition. That date was July 8, 1986. Applying a liberal construction to § 39-71-603, MCA (1985), we conclude that by providing his employer with all the information available to him on that date regarding the nature of his injuries, the fact that his condition was aggravated by his employment, and the nature of job duties which appeared to aggravate his condition, claimant complied with the Workers’ Compensation Act’s notice requirements.

II

Did claimant sustain an injury within the meaning of § 39-71-119(1), MCA (1985), during the course of his employment with John Jump Trucking, Inc.?

It is undisputed that claimant went to work for Jump with preexisting pathology in his cervical spine. It is undisputed that the condition of his spine made him more susceptible to further injury from even minor trauma, if experienced on a regular basis. It is undisputed that the bouncing and jarring from operating his logging truck did aggravate claimant’s underlying condition and culminated in the disability for which he first left work on July 8,1986. However, in spite of those undisputed facts, the hearing examiner concluded as a matter of law that:

“3. Claimant did not suffer an ‘injury,’ as defined in Section 39-71-119(1), MCA (1985), that arose out of and in the course of his employment for John Jump Logging.”

The trial court did not explain clearly how it arrived at that conclusion. However, in its discussion of that conclusion, it stated:

“Where a disabling condition occurs over a long period of time, it may be an occupational disease rather than an injury. Greger v. United Prestress, Inc., 180 Mont. 348, 590 P.2d 1121 (1978). Also, it is important to consider the issue of ‘time definiteness,’ where a limited and specific exposure to fumes and chemicals satisfied both unexpectedness and time definiteness required by the injury statute. Bremer v. Intermountain Ins. Co., 223 Mont. 495, 727 P.2d 529, 43 St.Rep. 1942 (1986).”

While the trial court indicated the importance of considering “time definiteness,” it does not appear from its decision that it did consider that factor or that that was the basis on which it arrived at its decision.

As we pointed out in the previous section, we review a trial court’s conclusions of law to determine whether they are correct.

On appeal, claimant contends that the following series of decisions from this Court establish that based on the undisputed facts he did sustain an injury within the meaning of § 39-71-119(1), MCA (1985): Viets v. Sweet Grass County (1978), 178 Mont. 337, 583 P.2d 1070; Strandberg v. Reber Co. (1978), 179 Mont. 173, 587 P.2d 18; Hoehne v. Granite Lumber Co. (1980), 189 Mont. 221, 615 P.2d 863; Jones v. St. Regis Paper Co. (1982), 196 Mont. 138, 639 P.2d 1140; Wise v. Perkins (1983) 202 Mont. 157, 656 P.2d 816; Shepard v. Midland Foods, Inc. (1983), 205 Mont. 146, 666 P.2d 758; Kraft v. Flathead Valley Labor & Contractors (1990), 243 Mont. 363, 792 P.2d 1094.

The application of this line of authority to a fact situation similar to the one in this case was first summarized in Jones v. St. Regis Paper Co. In that case, the claimant went to work at a lumber mill with preexisting degenerative disc disease in his lower back. There was evidence that the continual bending and lifting done by him in his job caused stress on his lower back which aggravated the existing degenerative disc condition over the period of approximately two years that he worked there. Defendant denied that claimant sustained an injury within the meaning of § 39-71-119, MCA. It was the defendant’s position that it was inconsistent for the claimant to allege that his injury developed gradually and that it was caused by a specific incident.

In reversing a Workers’ Compensation Court conclusion that claimant had not suffered a compensable injury, we found the following evidence significant:

“Evidently, the Workers’ Compensation Court did not consider Dr. Shanks’ deposition testimony which indicated that a series of minor traumas could lead to a condition such as that suffered by the claimant.
"... In addition to his definite statement quoted above, that degenerative disc disease was not a disease but a condition associated-with acute trauma, or ‘repeated small traumas,’ Dr. Shanks testified that the condition had, to the best of his knowledge, been present before August 21,1979.”

Jones, 639 P.2d at 1145.

Based on the above testimony, we cited the following line of decisions to support a conclusion that claimant had in fact been injured during the course of his employment.
“In Strandberg v. Reber Co. (1978), 179 Mont. 173, 175-177, 587 P.2d 18, 19, 20, this Court held that when it is proved medically possible that an industrial accident or injury aggravated a pre-existing condition, that proof is sufficient to establish a compensable disability. Similarly, in Viets v. Sweet [G]rass County (1978), 178 Mont. 337, 340, 583 P.2d 1070, 1072, we indicated that evidence that an accident aggravated a pre-existent condition is more reliable than evidence that an accident caused a disabled condition. In Hoehne v. Granite Lumber Company (1980), [189] Mont. [221, 225], 615 P.2d 863, 865, 37 St.Rep. 1307, 1310, a case more nearly on point, we held that ‘a tangible happening5 under Section 39-71-119, MCA, could be ‘not a single isolated incident ... but rather a chain of accidents or incidents, i.e., the stacking of lumber on a daily basis.5 We cited approvingly Erhart v. Great Western Sugar Company (1976), 169 Mont. 375, 380-381, 546 P.2d 1055, 1058, which said:
“ ‘Not only must claimant show an unusual strain, but the strain must result from a tangible happening of a traumatic nature ... A tangible happening must be a perceptible happening ... Some action or incident, or chain of actions or incidents, must be shown which may be perceived as a contributing cause of the resulting injury. ’ (Emphasis supplied.)
“The lines in Hoehne, supra, were clearly drawn. The sole difference was that one party believed that a gradually developing job-related injury not attributable to one specific incident was an ‘injury,5 and the other believed it was not. This Court held that it was. The reasonable conclusion from this holding is that, if there is strong enough evidence that the gradually developing injury is job-related, it is an ‘injury5 within the meaning of section 39-71-119, MCA, and is compensable, whether or not claimant states that there was a specific incident.55

Jones, 639 P.2d at 1145-46.

Based on the same authorities, we arrived at a similar conclusion in Shepard v. Midland Foods, Inc. In that case, the claimant had pain in his knees from degenerative conditions which preexisted his employment. That condition was diagnosed in 1972, and he went to work for his employer in 1973. However, there was evidence that the rate of degeneration was accelerated by both the physical nature of his work over a period of eight years, and a single incident at work in which he twisted and struck his left knee. Several months after that incident he was forced to retire from work because his knees were so bad that they were no longer functional. The evidence was, however, that the single traumatic incident was a small factor in the total extent of his impairment, and that the primary cause of his ultimate disability was the long term wear and tear on his knees throughout the course of his employment from 1972 through 1980. When asked about the cause of his disabling condition, his treating physician testified: “The job that you described to me, that was described to me that Mr. Shepard did at Midland Pack, I am sure would be an accelerant.55

Shepard, 666 P.2d at 761.

In Shepard, the Workers’ Compensation Court also denied claimant disability benefits based on its conclusion that his knees deteriorated for other than work-related reasons. However, citing the previous line of authorities, we reversed that decision by the trial court. In conclusion, we held that:

“In the case at bar, both Dr. Griffin and Dr. Taylor testified by deposition that the heavy work Mr. Shepard routinely performed at Midland would have aggravated his existing condition, i.e., would have accelerated the breakdown of his knees. Both physicians recognized the February 14, 1980, accident as an aggravant of Mr. Shepard’s condition. X-rays showed ‘a marked increase’in varus bone deformity between 1972 and 1980, just after Mr. Shepard’s accident. The X-rays indicate ‘many, many subluxations,’ or small dislocations in the knee joints, which were not evident in 1972. The physicians stated that these symptoms were indicative of wear and tear on the joint, and would probably result in pain and instability. This evidence of work-related injury aggravating a pre-existing condition is considerable and is unrebutted.” [Emphasis added.]

Shepard, 666 P.2d at 762.

Most recently, in Kraft v. Flathead Valley Labor & Contractors, we held that an employee who developed worsening symptoms of carpal tunnel syndrome from the repeated trauma of stacking lumber over a period of 15 months, sustained an injury within the meaning of § 39-71-119(1), MCA (1985).

The defendant, on the other hand, relies on a series of decisions from this Court which stand for the proposition that ailments which occur gradually over a long period of time lack sufficient “time definiteness” to be considered an injury. For example, in McMahon v. Anaconda Co. (1984), 208 Mont. 482, 678 P.2d 661, the claimant was exposed to various toxins in the work place over the period of 22 years that he worked for the employer. As a result, he complained of throat and lung problems which, in turn, led to psychological problems. The Workers’ Compensation Court denied benefits for injury or disease. We remanded for further consideration under the Occupational Disease Act; however, we concluded that the conditions about which claimant complained resulted from exposure over too many years to fall within the definition of injury. In arriving at that decision, we stated:

“Despite the detailed definition, it remains a difficult task to satisfactorily describe and define injury to the exclusion of disease. See Laplant, Opp, Workers’Compensation and Occupational Disease, 43 Mont. L.Rev. 75, 92-100 (1982). Professor Larson identifies two crucial points of distinction: Unexpectedness,’and‘time definiteness.’ IB A. Larson, The Law of Workmen’s Compensation, Section 41.31 at 7-357. We find the second point to be the critical factor in this case. The fact that claimant’s ailments were so very gradual in onset excludes them from the definition of injury.”

McMahon, 678 P.2d at 663.

We also added that:

‘We hesitate to attempt to locate the line between long-term, gradual trauma or disease and, short-term, accidental trauma, exposure, or strain.”

McMahon, 678 P.2d at 663.

In Wear v. Buttrey Foods, Inc. (1988), 234 Mont. 477, 764 P.2d 139, we held that where a grocery checker alleged numerous physical complaints attributable to the wear and tear of her job activities over a period of 17 years, she had also failed to satisfy the requirement of “time definiteness” which would classify her physical maladies as “injuries.”

The State Fund argues that because claimant’s disability resulted from micro-traumas which occurred over a period of approximately 5V2 years, the traumas were not sufficiently “time definite” to constitute an injury.

In those cases relied on by claimant, the period of time over which the injury occurred ranged from one week (Wise v. Perkins) to eight years {Shepard). In those cases relied upon by defendant, the physical conditions complained of were caused by activities that occurred over periods of 17 and 22 years. However, as we pointed out in McMahon, “[w]e hesitate to attempt to locate the line between long-term, gradual trauma or disease, and short-term, accidental trauma, exposure, or strain.” McMahon, 678 P.2d at 663. Further, in this case, it is not necessary that we do so.

We relied on Professor Larson’s treatise for the “time definiteness” requirement. It is appropriate, therefore, to look to the same treatise for further elaboration on what is meant by “time definite.” In doing so, we see that the requirement may be satisfied by applying it to either the time over which claimant’s physical condition is caused, or the time period over which disability results. For example, Professor Larson states:

“Probably the underlying practical reason for insisting on a definite date is that a number of important questions cannot be answered unless a date of injury or accident is fixed, such as which employer and carrier is on the risk, whether notice of injury and claim are within the statutory period, whether statutory amendments were in effect, which wage basis applies, and many others.
“It has been shown above that the concept of time-definiteness can be thought of as applying to either the cause or the result. A relatively brief exposure to fumes, dust or cold may lead to a protracted period during which the victim gradually succumbs to disease; conversely, months or years of exposure to poisons, jolts or strains may lead to a sudden collapse on a particular day. In either case it is relatively easy to satisfy the definite-time requirement by merely accepting the view that suddenness may be found in either cause or result....
"... . It is safe to say, however, that on the strength of one or more of these reasons, most jurisdictions have at some time awarded compensation for conditions that have developed, not instantaneously, but gradually over periods ranging from a few hours to several decades, culminating in disability from ... arthritis ... back injury, herniated disc ... and the like.
“On the other hand, most of the same jurisdictions have at some time denied compensation for injuries in this category.
“It will be observed, however, on examination of the unsuccessful cases, that most of them fall into the category of injuries whose cause and result were both difficult to locate in time. In other words, the majority of jurisdictions appear to be satisfied on the time-definiteness issue if either the precipitating incident or the manifestation of the disability itself was of a sudden or reasonably brief character.” [Emphasis added.]

IB A. Larson, The Law of Workmen’s Compensation, § 39.01 at 7-334, 7-335, 7-350,and 7-350.13 (1987).

In this case, we conclude that the “time definiteness” requirement articulated in McMahon is satisfied by the fact that the physical results of the traumas that claimant experienced over a protracted period of time manifested themselves over a relatively short period of time.

Claimant testified that he first began losing strength in his left arm in December 1985 and that those symptoms increased to include muscle spasms, cramps, and severe neck pain between that time and July 8, 1986. From the onset of his symptoms, until they became so severe that he could no longer continue working, approximately six months elapsed. Claimant’s testimony in this regard is undisputed. For these reasons, the results of the traumas to which claimant was exposed during the course of his employment were sufficiently “time definite,” and, pursuant to our previous decisions, relied on in Jones and Shepard, we conclude that claimant was injured within the meaning of § 39-71-119, MCA (1985).

We reverse the judgment of the Workers’ Compensation Court and remand this case for further proceedings consistent with this opinion, including a determination of the extent of claimant’s disability and what, if any, benefits, costs, or fees he may be entitled to under the Workers’ Compensation Act.

Reversed and remanded.

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


text:
    In re the MARRIAGE of LANA KAY WILSON FRONK, Petitioner and Appellant, v. ROBERT LEO WILSON, Respondent and Respondent.
    No. 91-122.
    Submitted on briefs Sept. 12, 1991.
    Decided Oct. 29, 1991.
    250 Mont. 291.
    819 P.2d 1275.

      Carol C. Johns, Wolf Point, for petitioner and appellant.
    David L. Irving, Glasgow, for respondent and respondent.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Lana Kay Wilson Fronk appeals from an order of the District Court of the Fifteenth Judicial District, Roosevelt County, which increased both the child support obligation and the visitation rights of her daughter’s father, Robert Leo Wilson. We affirm in part and reverse in part.

The issues are:

1. Did the trial court abuse its discretion in failing to set aside the default on the counterclaim?

2. Did the court err in setting Wilson’s modified child support obligation?

3. Should the modification of child support be made retroactive to the date of notice of the motion for modification?

4. Did the court err in adopting Wilson’s proposed findings, conclusions, and order?

5. Did the court err in ordering that Wilson may claim the parties’ child as a dependent for income tax purposes?

6. Did the court err in ordering that the parties must each pay their own attorney fees?

The parties’ marriage was dissolved in 1981 when their daughter, Katie Lynn Wilson, was one year old. The mother, Lana Kay Wilson Fronk (Fronk), was given sole custody of the daughter, with the father, Robert Leo Wilson (Wilson), to have “reasonable rights of visitation” subject to an injunction pending a psychiatric evaluation. The injunction was lifted in 1983. Wilson was ordered to pay $150 per month in child support and was made responsible for the daughter’s medical, dental, and optometrical expenses. Both parties have since remarried. At the time of these proceedings, Fronk lived in Utah, and Wilson lived in Alaska.

In January 1990, Fronk filed a petition for modification of the decree of dissolution, requesting that the amount and duration of child support payments be increased. Wilson filed an answer and counterclaim requesting that visitation be specified, that each party be responsible for his or her own attorney fees, and that he be allowed to take the income tax deduction for the child.

Following discovery, Fronk noticed a hearing on child support for October 2,1990. On September 27,1990, on Wilson’s motion, the court continued that hearing indefinitely. On the same day, and also on Wilson’s motion, the court entered a default judgment for Wilson on his counterclaim.

Fronk moved to set aside the default judgment. The court heard argument on that motion at a November 7, 1990, telephone conference at which the support issues were also argued.

On January 18, 1991, the court entered its findings, conclusions, and “decree of dissolution.” The court increased Wilson’s support obligation to $241 per month until the child is 12 years old and to pay $298 per month thereafter until she is emancipated. It made no statement finding Fronk properly in default or denying her motion to have the default set aside, but it adopted Wilson’s proposals as to the issues raised in the counterclaim. It set Wilson’s visitation rights as, at a minimum, one visit per year at his residence for at least eight consecutive weeks during the summer. The court also ordered that Wilson shall be allowed to claim his daughter as a dependent for income tax purposes and that each party shall pay his or her own attorney fees incurred in this action.

I

Did the trial court abuse its discretion in failing to set aside the default on the counterclaim?

It is undisputed that Fronk did not file an answer to Wilson’s counterclaim. The grounds upon which she moved to set aside the default judgment were that it was not entered in accordance with the requirements of Rule 55(b)(2), M.R.Civ.R; that her attorney had requested of Wilson’s attorney that the issue of child support be resolved before the issue of visitation was addressed; and that Wilson’s attorney was aware of Fronk’s objections to the terms requested in the counterclaim. When the motion to set aside the default was argued in the November 7,1990, telephone hearing, the position of Fronk and her counsel was that the issue was “a matter of law and a question of procedure.” The District Court agreed, and the merits of the counterclaim were not argued.

Rule 55(b)(2), M.R.Civ.P., provides that

“[i]f the party against whom judgment by default is sought has appeared in the action, the party (or, if appearing by representative, the party’s representative) shall be served with written notice of the application for judgment at least three days prior to the hearing on such application.”

In September of 1990, Frank’s attorney was served with both the application for entry of default and the default entered by the district court clerk. In November of 1990, a hearing was held which included argument on setting aside the default. No judgment was entered on the counterclaim, the subject of the default, until January 18, 1991. We conclude that no violation of Rule 55(b)(2), M.R.Civ.R, has been shown.

Rule 55(c), M.R.Civ.R, provides that for “good cause” shown, a district court may set aside an entry of default. To determine the existence of good cause, courts should consider whether the default was willful, whether the party on whose behalf the default was entered would be prejudiced if the default were set aside, and whether the party against whom the default was entered has presented a meritorious defense to the claims against it. Cribb v. Matlock Communications, Inc. (1989), 236 Mont. 27, 30, 768 P.2d 337, 339. Appellate courts reverse refusals to set aside entries of default on a showing of slight abuse of discretion by the lower court. Cribb, 768 P.2d at 340.

There was no evidence before the District Court that Front’s default was willful. The prejudice to Wilson if the default is set aside is limited because visitation is to occur only once a year, in the summer months. As a result of her position that the entry of default should be set aside as a procedural matter, Fronk did not present all of her arguments on the counterclaim prior to entry of judgment. However, she did submit affidavits alleging physical and sexual abuse in support of her position on the issue of visitation. After consideration of the factors set forth in Cribb, we conclude that the lower court abused its discretion in failing to set aside the default. We reverse on this issue and remand for further proceedings before the District Court.

Issues 5 and 6 relate to other parts of the counterclaim. Because we reverse on the failure to set aside the default on the counterclaim, those issues, too, must be reconsidered on remand. Therefore, we will not discuss Issues 5 and 6.

II

Did the court err in setting Wilson’s modified child support obligation?

Wilson concedes Fronk’s point that a clerical error was made in calculating his net available resources to be considered in setting the amount of child support. He recalculates his net amount of available resources as $31,489, resulting in a monthly support obligation of $356.88 until the child reaches 12 years of age and $440.85 thereafter until she is emancipated. Both parties point out that the District Court can correct the miscalculation as a clerical mistake pursuant to Rule 60(a), M.R.Civ.R We agree. This recalculation should be retroactive to the date of the judgment from which this appeal is taken and should be included in the District Court’s findings and conclusions on remand.

Fronk asserts that, in calculating Wilson’s child support obligation, the District Court permitted him an excessive deduction for the cost of living in Alaska. The Montana Child Support Guidelines do not address a cost of living adjustment. But, as Wilson points out, this Court has stated that “[i]n appropriate cases, where there is evidence presented that shows there is substantial disparity between the value of the dollar in different locales, the Court may in equity need to make appropriate adjustments.” In re Marriage of Mitchell (1987), 229 Mont. 242, 249-50, 746 P.2d 598, 603. We hold that consideration of such a factor is not in itself an abuse of discretion.

The record indicates that the American Chamber of Commerce Researchers Association (ACCRA) Cost of Living Index, which was introduced into evidence by Wilson and upon which the court based its cost of living adjustment, was obtained from the State of Montana’s Census and Economic Information Center. We hold that the ACCRA index is a public record admissible into evidence under Rule 803(8), M.R.Evid. Additionally, Wilson gave several examples of how he is personally affected by the high cost of living in Alaska. We hold that the allowance of a 26 percent cost of living adjustment calculated from the ACCRA Cost of Living Index does not represent reversible error.

Fronk also contends that the District Court erred in allowing Wilson a deduction for federal income tax of $4,420, the amount withheld from his paycheck. She argues that the amount of his annual income tax refund should be subtracted from the amount allowed as a deduction. The Montana Child Support Guidelines require income to be calculated on the basis of disposable income. The District Court is in the best position to determine whether tax returns or payroll checks accurately reflect disposable income. We conclude that no reversible error has been shown.

Finally, Fronk argues that if the District Court considers Wilson’s new family when determining his obligation to support his first child, then it should also consider his new wife’s income and contributions. However, the District Court’s findings do not indicate that Wilson’s financial responsibility to support his new family was used as a separate factor in calculating his child support obligation.

III

Should the modification of child support be made retroactive to the date of notice of the motion for modification?

Fronk points out that the District Court has the power, under § 40-4-208(1), MCA, to modify the amount of any child support installments accruing subsequent to actual notice of the motion for modification. She argues that, due to her financial need, the delays in these proceedings caused by Wilson, and the “unconscionably” low child support prior to modification, she is entitled to modified child support retroactive to the date Wilson was served with the petition for modification. Her proposed findings, conclusions, and order reflected that position and provided that the increased child support would be effective February 5,1990.

Section 40-4-208(1), MCA, does not mandate that modifications of child support must be made retroactive to the date of notice of the motion for modification. Rather, it sets a limit as of that date. We hold that no abuse of discretion has been shown in the District Court’s prospective modification of the amount of child support.

IV

Did the court err in adopting Wilson’s proposed findings, conclusions, and order?

Fronk argues that the record does not support the District Court’s verbatim adoption of Wilson’s proposed findings, conclusions, and order. To the extent that the court’s judgment is reversed under Issue 1 above, this issue is moot.

As to the remaining findings, Fronk objects to finding #21:

“[Wilson] testified that a college education is a privilege, not a right or endowment, and that any payments he might make would be based upon a decision to make a personal gift to his child based upon meritorious achievement and the child’s ability and willingness to attend college, rather than required as if a ‘reward’ simply because [Fronk] and [Wilson] were divorced.”

Wilson did not so testify. While we must caution the District Court to use discretion in adopting proposed findings, we hold that the presence of the above finding does not constitute reversible error. We note that under § 40-4-208(5), MCA, any provision for child support following the child’s emancipation or graduation from high school is the exception, not the norm.

Affirmed as to the issue of child support except for correction of the clerical error in calculating the amount of that support, and reversed and remanded as to the issues raised in Wilson’s counterclaim.

JUSTICES GRAY, HARRISON, HUNT, McDONOUGH, TRIEWEILER, and WEBER concur.