author: MR. CHIEF JUSTICE TURNAGE MR. JUSTICE SHEEHY,

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. PATRICK H. CAIN, Defendant and Appellant.
    No. 85-446.
    Submitted on Briefs Dec. 30, 1985.
    Decided April 8, 1986.
    717 P.2d 15.

      James G, Hunt, Helena, for defendant and appellant.
    Mike Greely, Atty. Gen., Dorothy McCarter, Asst. Atty. Gen., Helena, Keith D. Haker, Co. Atty., Miles City, for plaintiff and respondent.
   MR. CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Appellant, Patrick Cain, was convicted of conspiracy to commit arson and attempted criminal mischief following trial before a jury in the Sixteenth Judicial District. We affirm.

The Crossroads Inn (Inn) in Miles City, Montana, was destroyed by fire on the morning of October 20, 1984. Jack Holmes, who lives near the Inn, was awakened by smoke around 4:00 that morning. After driving over to the Inn, he saw heavy smoke coming from the kitchen area. Officer Newby arrived at the Inn around 4:30 a.m. He observed that most of the flames were around the kitchen area and coming through the roof above the kitchen.

Sometime that same morning, Cain and Joseph Leser were involved in a car accident south of Miles City at the Pumpkin Creek Bridge. Officer Schiffer was notified of the accident around 4:55 a.m. by police dispatch. When he arrived, he saw a car in a ditch near the bridge. Cain was in the driver’s seat, and Leser was in the passenger seat. After inquiring into the cause of the accident he drove the two men back to town. Officer Schiffer later learned that the car was registered to Joanne Cain, appellant’s mother.

On October 21, 1984, Detective Uden received an anonymous tip on the Crime Stoppers network concerning the Crossroads Inn fire. Detective Uden testified the tip indicated that Rod Walter, the owner of the Inn, had hired someone to set the fire; that $8000 was the agreed upon price; and that cash registers had been removed from the Inn. He received a second Crime Stoppers tip two days later. That tip indicated that Cain and Leser had been involved in an accident near the Pumpkin Creek Bridge on the morning of the fire and that cash registers and evidence from the fire had been removed from Cain’s vehicle and hidden under the bridge so that the officer investigating the accident would not associate the two men with the fire.

On the basis of this information, Detective Uden and Patrolman Schiffer went to the scene of the earlier accident at the Pumpkin Creek Bridge. When they arrived they found several items of property that came from the Crossroads Inn. In the ditch near where Cain’s car had been, they found cash register receipts from the Crossroads Inn, a cash register key, and plastic parts similar to the type used in the construction of cash registers. Underneath the bridge, they found fresh indentations of square corners in the ground.

Detective Uden then obtained a search warrant for Cain’s car on the basis of the evidence found at the bridge and the two tips. Upon searching the car, he found cash register receipts from the Inn, a rubber stamp for a receipt and broken plastic parts.

On October 26, 1984, without realizing that there was a warrant out for his arrest, Cain voluntarily came into the police department to turn himself in. After being read his Miranda warnings, Cain admitted to burglarizing the Inn. However, he denied then, and does so now, that he had any part in setting fire to the Inn.

Joe Leser testified for the prosecution pursuant to a plea bargain agreement. According to his testimony, Cain approached him with the proposition of burning down the Inn in return for some insurance money. Leser agreed. After the Inn had closed, Cain and Leser entered the building with a key that Cain had. They took three cash registers and other items and put them in Cain’s car. Then they wadded up paper sacks, put them between pipes in the basement below the kitchen and lit the sacks. After the sacks began to burn, Cain kicked the kitchen door in to make it look like the Inn had been broken into.

Cain’s testimony was essentially the same as Leser’s except that he denied suggesting to Leser that they burn down the Inn for money, and he asserted that he never set fire to the Inn.

Appellant raises four issues for our consideration:

1. Whether testimony concerning the two Crime Stoppers tips constituted a violation of appellant’s Sixth Amendment right to confront the witnesses against him.

2. Whether the Crime Stoppers tips were reliable for determining probable cause to obtain a search warrant.

3. Whether testimony concerning the tips was inadmissible hearsay, and whether its use at trial created reversible error because it was not harmless.

4. Whether the prosecutor’s conduct in mentioning the tips in his opening statement and closing argument and questioning a witness as to the content of the tips breached his duty to the accused.

Because the issues center on the introduction into evidence of the Crime Stoppers tips, it is appropriate that we set out exactly what was said.

The main source of objection was the testimony given by Detective Uden on direct examination:

“Q. Did the Miles City Police Department receive a tip or tips on the Crime Stoppers network relative to the Crossroads Inn fire?
“A. Yes.
“Q. When was that tip received?
“A. First tip was received on October 21, 1984, at approximately 12:40 p.m.
“Q. What information did that tip provide?
“A. That information indicated that the Crossroads Inn fire was set and that Mr. Rod Walter, the owner of the Crossroads Inn, had hired the fire to be set and that $8,000 was the agreed upon price for the fire and that some cash registers or tills had been removed from the scene.
“Q. Was there more than one tip?
“A. Yes, sir, there was.
“Q. When was the second tip?
“A. The second tip was received in the late morning of October 23, 198 [4].
“Q. What did that tip consist of?
“A. That tip indicated that Mr. Pat Cain and Mr. Joe Leser, both of Miles City, had been involved in an accident on the early morning of the fire at a location north of the Pumpkin Bridge on Highway 59 which is south of Miles City and that the cash registers and evidence from the fire had been removed from the vehicle that was involved in the accident and hidden under the Pumpkin Creek bridge so that the highway patrolman investigating the accident wouldn’t associate the two individuals with the Crossroads Inn fire.”

The prosecutor also briefly mentioned the tips in his opening statement and closing argument. However, at no time during the trial did defense counsel object to references to these tips.

I

Appellant contends that the Crime Stoppers tips were hearsay and violated his Sixth Amendment right to confront the witnesses against him. Section 46-20-702, MCA, provides the appropriate standard of review for alleged constitutional violations:

“. . . No claim alleging an error affecting jurisdictional or constitutional rights may be noticed on appeal, if the alleged error was not objected to as provided in 46-20-104, unless the defendant establishes that the error was prejudicial as to his guilt or punishment and that:
“(1) the right asserted in the claim did not exist at the time of the trial and has been determined to be retroactive in its application;
“(2) the prosecutor, the judge, or a law enforcement agency suppressed evidence from the defendant or his attorney that prevented the claim from being raised and disposed of; or
“(3) material and controlling facts upon which the claim is predicated were not known to the defendant or his attorney and could not have been ascertained by the exercise of reasonable diligence.”

[Emphasis added.]

Since there was no objection to the tips at any time during the trial, appellant must meet both requirements of the statute; i.e., he must show prejudicial error and at least one of the three statutory requirements.

Appellant does not meet any of the three requirements listed in the statute. Appellant’s constitutional right to be confronted by the witnesses against him existed at the time of trial, as did the right to prevent testimony that was hearsay. Although appellant claims that testimony about the tips had the same effect as actively concealing the name of the witness since the informant was anonymous, he had ample opportunity to object to such questions before the content of the tip was testified to. Furthermore, nothing prevented appellant from raising his constitutional claims at trial by objection or motion to strike. Finally, there are no facts upon which appellant bases his claim that were not known to him at the time of trial. Since appellant has not met any of the three requirements, his failure to object at trial constitutes a waiver of his constitutional claim. Section 46-20-104, MCA.

We do not decide the question whether admission of the anonymous tips into evidence violated appellant’s Sixth Amendment confrontation right. Rather, we hold that by failing to raise his objection at trial, he waived the right to bring such objection on appeal. The error, if there was one, cannot be noticed because appellant does not satisfy the requirements of Section 46-20-702, MCA.

The United States Supreme Court gave firm support to this view in Estelle v. Williams (1976), 425 U.S. 501, 96 S.Ct. 1691, 48 L.Ed.2d 126. The defendant in that case was forced to wear identifiable prison clothing at his trial by jury, but no objection to this was ever raised. The Court recognized that it is a violation of the Fourteenth Amendment for the state to compel an accused to stand trial before a jury while wearing a prison uniform. However, by failing to raise an objection, defendant was held to have waived his constitutional claim. “The reason for this rule is clear: if the defendant has an objection, there is an obligation to call the matter to the court’s attention so the trial judge will have an opportunity to remedy the situation.” Estelle, 425 U.S. at 508, n. 3. The Court further recognized that “[u]nder our adversary system, once a defendant has the assistance of counsel the vast array of trial decisions, strategic and tactical, which must be made before and during trial rests with the accused and his attorney. Any other approach would rewrite the duties of trial judges and counsel in our legal system.” Estelle, 425 U.S. at 512, 96 S.Ct. at 1697. This reasoning applies with equal force in the present case.

The approach taken in Estelle has also been taken by this Court in State v. Weinberger (1983), [206 Mont. 110,] 665 P.2d 202, 40 St.Rep. 844. In that case, as in the present, defendant raised various objections to certain out of court statements for the first time on appeal. This Court stated:

“The District Court was never given an opportunity to rule on admission of the statements or to correct itself if admission was not proper. We will not put the trial court in error where it has not been given such a chance.”

Weinberger, 665 P.2d at 216.

We reaffirm the approach taken in Weinberger. On an alleged constitutional violation where the error was not objected to at trial, a party must show prejudicial error and one of the three requirements listed in Section 46-20-702, MCA, before the claim will be noticed on appeal. Since appellant did not meet this burden, we do not consider the merits of his constitutional claim.

II

Appellant contends next that the Crime Stoppers tips were not sufficiently reliable to meet the standards required for determining probable cause for a search warrant. The same problem that plagued appellant’s first issue also burdens this one. No motion to suppress the evidence obtained from the search of appellant’s car was ever filed, nor was any objection based on those grounds raised at trial. For the reasons discussed above, we find that appellant has waived his right to raise this issue on appeal.

We note in passing, however, that the use of anonymous tips as an element in obtaining a search warrant has been sustained by the United States Supreme Court in Illinois v. Gates (1982), 462 U.S. 213, 103 S.Ct. 2317, 76 L.Ed.2d 527, and by the Montana Supreme Court in State v. Kelly (1983), [205 Mont. 417,] 668 P.2d 1032, 40 St.Rep. 1400, where other corroborating evidence is shown. Under the totality of the circumstances analysis, the question is simply whether, given all the facts set forth in the affidavit, “there is a fair probability that contraband or evidence of a crime will be found in a particular place.” Gates, 462 U.S. at 238, 103 S.Ct. at 2332. This determination is a practical, common sense decision, not a technical, analytical litmus test. Therefore, as a general rule, we do not disapprove of the use of anonymous tips as one element in the determination of probable cause for a search warrant.

Ill

Appellant asserts that testimony on the content of the tips was hearsay, constituting reversible error because they were not harmless beyond a reasonable doubt. We reiterate that no objection to the tips was raised at any time during the trial. Thus, in order to prevail, appellant must demonstrate that admission of the testimony constituted plain error affecting a substantial right. Rule 103, M.R.Evid. Before we decide whether admission of the testimony constituted reversible error, we must first determine whether the tips were hearsay.

Respondent would have us believe that the description of the tips was not hearsay because it was not asserted to prove the truth of their contents; rather, it was used to explain the basis of the investigation and the issuance of the subsequent search warrant. We reject this assertion. An integral part of the State’s case was proving conspiracy between appellant, Leser and Rod Walter, the owner of the Inn. This theory of the case was asserted in the prosecution’s opening statement. Therefore, testimony that the tip indicated that Walter had hired someone to set the fire and that appellant and Leser took evidence from the fire could only be viewed by the jury as tending to prove the truth of the assertion. We cannot reasonably require a jury of lay persons to make a distinction which is so fine that it proves difficult even for attorneys and legal scholars to make.

Respondent cites State v. White (1980), 185 Mont. 213, 605 P.2d 191, and State v. Paulson (1975), 167 Mont. 310, 538 P.2d 339, in support of its contention that the tips were not hearsay. However, both cases are distinguishable by the fact that the testimony was introduced for the purpose of showing probable cause to make an arrest without a warrant. The testimony in those cases was not introduced for the purpose of explaining the basis of an investigation. Furthermore, Detective Uden could have testified that the basis for the investigation was a Crime Stoppers tip without testifying as to the content of the tip. The description of the tips was totally unnecessary to prove respondent’s asserted purpose. Therefore, we find that the tips were hearsay. However, although admission of the tips was error, because appellant failed to raise an objection to this at trial, our inquiry only goes so far as to determine whether the admission was plain error affecting substantial rights of appellant. Rule 103, M.R.Evid.

Testimony on the first tip indicated that Rod Walter had hired someone to set the fire and that cash registers had been removed from the Inn. Appellant’s name was not mentioned. The second tip indicated that appellant and Leser were in an accident near the Pumpkin Creek Bridge on the morning of the fire and that cash registers and evidence from the fire had been removed from the car and hidden.

The substance of the second tip was completely corroborated by the independent testimony of Patrolman Schiffer and Detective Uden. The same evidence was established without the testimony on the tip. Thus, testimony concerning the second tip had no prejudicial effect on appellant.

The only part of the first tip which was not directly proved was the information about Walter hiring someone to set the fire. However, testimony was given that the Crossroads Inn was in financial trouble and was losing a great deal of money. Leser testified that appellant suggested to him that they burn the Inn in return for money. Much of Leser’s testimony was corroborated by other evidence. Although appellant contends that Leser is not a credible witness, the jury had an opportunity to judge his credibility and apparently believed his version of the matter over that of appellant. The fire marshall testified that the fire started in the basement and could have been set by paper bags being lit underneath the floor joints. He found very little inventory in the Inn as compared to the usual situation.

The other evidence linking appellant to the crime was overwhelming. Cash register receipts from the Inn were found in his car and in the area where his car had wrecked on the night of the fire. Appellant admitted to burglarizing the Inn at a time shortly before the fire. Therefore, appellant has failed to demonstrate that admission of part of the first tip constitutes plain error. “At most, this statement can be viewed as linkage testimony that is incriminating only in conjunction with other facts.” Weinberger, 665 P.2d at 213. (Emphasis added.) This statement was not vital to the State’s case, and its admission into evidence was merely cumulative of all the other evidence submitted. In light of the fact that the other evidence presented was overwhelming, its admission was harmless.

IV

Finally, appellant contends that the prosecutor breached his duty to the accused by questioning the witness about the tips and by mentioning the tips in his opening statement and closing argument. This issue was not raised at trial and will not be considered on appeal. Section 46-20-104, MCA; State v. Lemmon (1984), [214 Mont. 121,] 692 P.2d 455, 41 St.Rep. 2359.

However, a word of caution to the prosecution is in order. We condemn the use of anonymous tips as evidence at trial. The jury has no means in which to test the reliability of the informant. Furthermore, serious questions arise as to a defendant’s Sixth Amendment and confrontation rights. There was no need to introduce the content of the tips for any reason in this case. By taking such actions in the future, the prosecution runs the risk that a conviction might be overturned on appeal. Also, it is highly unlikely that in future cases defense counsel will fail to object to such testimony, which would present a different question to this Court. With this said, for the reasons stated above, the judgment must be affirmed.

MR. JUSTICES HARRISON, WEBER, GULBRANDSON and MORRISON concur.

MR. JUSTICE SHEEHY,

dissenting:

I agree with the result foregoing.

MR. JUSTICE HUNT did not participate in this appeal.


source: Caselaw Access Project

author: MR. JUSTICE SHEEHY MR. JUSTICE SHEEHY

license: Public Domain

text:
    ESTHER McDONALD, John McDonald, Jr., and Eugene Manley, individually as representatives of the Granite County Water Users Association, et al., Petitioners, v. THE STATE OF MONTANA, and the Water Courts of the State of Montana, Respondents.
    No. 85-468.
    Submitted Feb. 21, 1986.
    Decided April 8, 1986.
    Rehearing Denied Aug. 4, 1986.
    722 P.2d 598.

      Josephson & Fredricks, Richard Josephson argued, Big Timber, for petitioners.
    W.W. Lessley argued, Chief Water Judge, Bozeman, Mike Greely, Atty. Gen., Clay R. Smith, Asst. Atty. Gen., Helena, Ed Steinmetz, Water Master, Bozeman, for respondents.
   MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

We determine here that the provisions of Section 85-2-234, MCA, applicable to final decrees issued by the Water Courts (and also applicable to preliminary decrees under Section 85-2-231, MCA), requiring the final decree to state “the amount of water, rate and volume included in the (water) right” are not unconstitutional as to direct flow irrigation water rights that have not heretofore been historically decreed or defined in terms of volume.

Esther McDonald and the other parties named as petitioners in the above caption brought this original action in the Montana Supreme Court by filing their complaint for declaratory judgment. Before deciding to accept jurisdiction of the cause, we asked for responses from the Water Courts and from the State of Montana, the named respondents. We consolidated with this cause for purpose of responses cause No. 85-345, entitled Montana Department of Fish, Wildlife & Parks, Petitioner v. Water Court of the State of Montana and the Judges of that Court, Respondents, and cause No. 85-493, United States of America, Petitioner v. Water Court of the State of Montana and the Judges of that Court, Respondents. After receiving responses, we set oral argument for the respective causes as consolidated for February 21, 1986. On that date, counsel for the various parties appeared, and presented a stipulation that had been entered into by the parties for the purpose of resolving the several issues raised.

In the stipulation of the parties presented on February 21, 1986, it is stated:

“12. Count I of the McDonald complaint requests the Montana Supreme Court declare unconstitutional the requirements of Title 85, Chapter 2, Part 2, MCA, requiring quantification of water rights by volume, as violating the recognition and confirmation of such water rights as they existed on the effective date of Art. IX, Section 3 of the 1972 Constitution of Montana.
“13. To the extent that no controverted issues of fact are involved, the parties agree the constitutionality of Title 85, Chapter 2, Part 2, MCA, and specifically Section 85-2-234(5) (b), MCA, which requires the decreeing of volume for pre-July 1, 1973 direct flow irrigation water rights that have not been historically decreed or defined in terms of volume, should be expeditiously decided by the Montana Supreme Court as the issue is pending in Cause No. 85-468.”

The constitutional issue presented is framed on the allegation contained in Count 1(c), paragraph XI, of the McDonald complaint that the

“. . . water courts have been and are continuing to adjudicate existing water rights on the basis of volume, limiting such rights to a certain volume, expressed in acre-feet per acre per year.”

The 1972 Constitution, Art. IX. Section 3 provides:

Water Rights. (1) All existing rights of the use of any waters for any useful or beneficial purpose are hereby recognized and confirmed.
“(4) The legislature shall provide for the administration, control and regulation of water rights and shall establish a system of centralized records, in addition to the present system of local records.”

McDonald has attached to her complaint in this Court as Exhibit A, random copies of typical decrees made by district courts prior to July 1, 1973. In each of the decrees, the water rights there protected are expressed in terms of flow rate and not in terms of volume.

The statutory provision for the measurement of water is found in Section 85-2-103, MCA. It states:

“Measurement of water. (1) After July 1, 1899, a cubic foot of water (7.48 gallons) per second of time shall be the legal standard for the measurement of water in this state.
“(2) Where water rights expressed in statutory or miner’s inches have been granted, 100 statutory or miner’s inches shall be considered equivalent to a flow of 2.5 cubic feet (18.7) gallons per second, 200 statutory or miner’s inches shall be considered equivalent to a flow of 5 cubic feet (37.4 gallons) per second, and this proportion shall be observed in determining the equivalent flow represented by any number of statutory or miner’s inches.
“(3) The provisions of this section shall not affect or change the measurement of water decreed by a court prior to July 1, 1899, but such decreed water shall be measured according to the law in force at the time such decree was made and entered.”

McDonald and her copetitioners allege and argue that their respective water rights have never been expressed in terms of volume, but rather in terms of flow rate (miner’s inches or cubic feet per second) limited only by the acres respectively irrigated. They contend that “any attempt to define volume in the decrees listing pre-July 1, 1973 water rights is speculative, places an added burden on pre-July 1, 1973 rights and violates Article IX, Section 3, of the 1972 Montana Constitution and Section 85-2-103, providing that the flow rate is the ‘legal standard’ for measurement”.

McDonald and her copetitioners have standing to sue. They are the owners of water rights in areas for which temporary preliminary decrees have been issued by the Water Courts, to-wit the Flint Creek drainage area in Granite and Deer Lodge Counties, the Boulder River Basin area in Sweet Grass and Park Counties, the Sweet Grass Creek drainage area in Park, Stillwater and Sweet Grass Counties and the Bridger Creek drainage area in Gallatin, Park, Sweet Grass and Stillwater Counties. As to temporary preliminary decrees which have been entered for those basins, the petitioners have entered their objections to the determination of their and other rights in terms of volume.

The issue raised is not limited personally to McDonald and her copetitioners, but extends throughout the whole process of the adjudication of irrigation water rights by the Water Courts. The issue affects all of those rights. Adjudication by this Court now as to the issue raised would serve to guide the Water Court in this particularly important matter; would provide judicial economy in avoiding protracted litigation both in the Water Courts and in this Court; and would serve the public policy of the state by expediting the determination of existing water rights. It is therefore appropriate that we accept jurisdiction of this issue by way of declaratory relief, involved as it is with our duty to supervise the Water Courts. We have, moreover, a justiciable issue which does not require further determinations of factual issues either by a master or by a district court. Section 27-8-201, MCA (power to declare rights); Rule 17(a), M.R. App.Civ.P.; Section 3-7-204, MCA; State ex rel. Judge v. Legislative Finance Committee (1975), 168 Mont. 470, 543 P.2d 1317; City of Billings v. Smith (1971), 158 Mont. 197, 490 P.2d 221; State ex rel. Schultz-Lindsay v. Board of Equalization (1965), 145 Mont. 380, 403 P. 2d 635.

McDonald and her copetitioners have raised other issues in their complaint relating to procedures and actions taken in the Water Courts to which they have made objection, but we do not direct our attention to those issues at this time.

Through Art. IX, Section 3(3), 1972 Mont. Const., the people of this state declared that all waters within the state are the property of the state for the use of its people and are subject to appropriation for beneficial uses as provided by law. The people, through the constitution, impressed on the legislature the duty of establishing a system of centralized records in addition to the present system of local records for the administration, control and regulation of water rights. Art. IX. Section 3(4), 1972 Mont. Const.

In order for the state to establish a system of centralized records, the legislature established the Water Courts (Title 3, Ch. 7, MCA) and provided for the adjudication of water rights (Ch. 697, Laws of Montana (1979), now Sections 85-2-211,-243, incl., MCA). In essence the legislature turned to the courts for such adjudication.

No more difficult task has ever been assigned by the legislature to the court system of this state. As Chief Water Judge W. W. Lessley pointed out in oral argument herein, only the courts could provide the mechanism by which existing water rights could be determined, recorded and protected with full constitutional guaranties.

There are two components to the Montana Constitutional guaranty: there must be an existing right to the use of water, and the use must be for a beneficial purpose. Art, IX. Section 3(1), 1972 Mont. Const.

We can accept as true the contention of McDonald and her copetitioners that practically every irrigation water right prior to July 1, 1973 was expressed in flow rate, expressed in miner’s inches or cubic feet per second and related directly or indirectly to the number of acres being irrigated. We can also accept as true their contention that the volume of water used by irrigators up to or within the limit of their appropriation rights would vary greatly from year to year depending upon circumstances not within the control of the irrigators, such as climatic conditions from year to year, subsoil types, lengths of the ditches, porosity, permeability, dry years, wet years and so on. It is natural therefore that irrigators would fear that the expression of a volume amount in acre feet as a limit of their right would adversely affect their flow rights to the use of water under certain conditions.

Yet Montana has always protected, by law and the decisions of this Court prior to 1972, and by the Montana Constitution since 1972, any beneficial irrigation right within the original appropriation of water. It is quite apparent from all the pre-1973 water cases in Montana that the courts look to beneficial use as the essential criterion in determining suits between water claimants.

In Tucker v. Missoula Light & Water Co. (1926), 77 Mont. 91, 250 P. 11, Tucker was entitled to 377 miner’s inches out of Rattlesnake Creek, north of Missoula, and the Missoula Light & Water Co., which supplied water to the City of Missoula, had total rights to 2,676 miner’s inches. However, only 1,119.5 inches of the Missoula right preceded the fifth decreed right which provided Tucker with 45 inches jointly with Missoula’s 115 inches.

In 1924, Missoula Light took 1,344 inches of the water out of Rattlesnake Creek through a flume and then passed it through a pipeline which had but 1,144.8 inches of capacity. Missoula Light returned 199.2 inches to the creek through a spillway away from Tucker. He testified that if he had received only. 40 or 50 miner’s inches, it would have been sufficient to protect his crops for the years involved. In passing on the case and granting damages to Tucker against Missoula Light, this Court noted:

“The so-called ‘ownership of water’ differs from that of personal property capable of corporeal possession. Neither the appropriator of water nor one to whom a right is decreed owns the corpus of any part of the flow of the stream. He is entitled to only the beneficial use of the amount of water called for by his appropriation or decree when he has need therefor, and providing his distributing system has a sufficient capacity to carry such an amount of water. (Citing a case.) When his ditches are incapable of carrying the amount of water decreed to him, his right is measured by the capacity of a system of distribution, regardless of his needs. (Citing cases and statutes.) So long as a party has all the water his necessity requires or that his ditches will carry, it is immaterial that he has a right, under decree or otherwise, to a greater flow from the creek. It is his duty to permit the excess to remain in the creek or, having diverted it, to return it to the creek in such a manner that it will be available to subsequent appropriators of decreed rights.” (Citing cases.) (Emphasis added.)

77 Mont. at 101-2, 250 P.2d at 15.

Another illustrative case is Quigley v. McIntosh (1930), 88 Mont. 103, 290 P. 266. Quigley was granted by the District Court 800 miner’s inches of water out of Ophir Creek in Powell County, but his right was junior to earlier appropriations totaling 1,650 inches. Three of the earlier appropriations, however, were appropriated for placer mining purposes, totaling 650 inches. Quigley alleged that the flow in Ophir Creek was more than sufficient to satisfy all the rights recognized and that during the months of May and June until about July 15, the flow of water in the creek actually exceeded the needs of all the prior appropriators as adjudicated. He had sought to divert 1,000 inches as an additional water right subject to the prior appropriations.

The District Court granted Quigley 800 inches of his claimed 1,000 inches but held that Quigley could not take the waters from the creek when the volume of water flowing therein was equal to or less than 1,650 miner’s inches. Quigley appealed the latter part of the judgment. The Supreme Court agreed that the District Court had erred. Since the prior placer appropriations of 650 inches might not be used, that amount of water in the stream was available for appropriation by Quigley, and it was error for the District Court to restrict his right of appropriation to a time when more than 1,650 inches of water were in the stream because the policy of the state was to avoid waste of waters:

“We have also said repeatedly that it is to the interest of the public that water be conserved for use, rather than be permitted to go to waste, to the end that the arid lands of the state may be put under irrigation and thus be made productive. (Citing cases.) . . . when [a] new water right is allowed it is governed by all of the provisions of the decree [in a decreed stream] just as if the appropriator had been a party to the original decree. He has the right to use the waters of the stream and in the order of his juniority.
“. . . As illustrative: It appears that three of the early rights, aggregating 650 inches, are confined exclusively to placer mining purposes. There may be years when no placer mining whatever is being done by the use of the waters of Ophir Creek. In the process of time when the placer mines no longer yield up their auriferous treasures, there will not be any use for these water rights. When the same are not required for use of placer mining, the waters must be allowed to flow in the stream, subject to capture by other users upon the stream in the order of their priority.”

Id. at 107-9, 290 P. at 268-69.

Anderson v. Cook (1901), 25 Mont. 330, 64 P. 873, presents a different facet. It is authority that a large number of miner’s inches might be necessary to provide a head of water sufficient to overcome seepage and leakage along the way to the farmlands. In this case, the parties owned a diversion ditch in common, out of which each took laterals to perform their irrigation. However, Cook placed his “boards” so as to totally inundate his lands, and in effect to waste the water. The Court said this in holding for Anderson:

“The parties did not own the water. They had a right to the use of it in common. They did not have a prior right. The defendants assume that they were at all times entitled to take out two-thirds of the water, provided they left one-third thereof in quantity in the main ditch. This is error. If there were 1,200 inches in the ditch, and they needed and took out 800 inches at a point 100 feet below the reservoir, there would be left 400 inches, one-third of the volume of water, with a journey of more than one mile to go in warm weather, and over a slow grade, and through a ditch from 144 inches to 228 inches wide, subject to very great loss from seepage, evaporation and actual leakage. The slightest knowledge of the laws of nature will convince any reasonable person that the plaintiff would get a very small part of the 400 inches wherewith to make his desert lands produce remunerative crops.”

25 Mont. at 338-9, 64 P. 876.

In the Anderson case, the District Court cured the problem by requiring that the defendants allow Anderson to take water out of the main diversion ditch exclusively two days of the week in order to get enough water to his place to cultivate his crops.

In Conrow v. Huffine, et al. (1914), 48 Mont. 437, 138 P. 1094, Huffine and others, having prior rights to 90 miner’s inches, took all of the waters out of Bear Creek, east of Bozeman, to irrigate approximately 70 acres. There were never more than 100 inches flowing in the creek during the irrigating season. Conrow had junior rights and sued on the ground that allowing Huffine to take all of the water that had been appropriated by him resulted in waste, and deprived the junior appropriator of any irrigation water. The District Court determined that Huffine and others had never irrigated more than 70 acres and said:

“While we have no legislation on the subject, the rule has generally been observed by the courts in this state, in fixing the amount required for economical use, to allow one inch per acre, unless the evidence discloses that a greater or less amount is required. All the witnesses who testified on the subject agreed that fifty or sixty inches furnished a sufficient head for effective working purposes [for Huffine] . . .”

Id. at 445-46, 138 P. at 1096-97.

An important element to determine the extent of a water right is the capacity of the ditch made by the first appropriator. Thus it was stated in Conrow.

“The test of the extent of an appropriation with reference to a subsequent right to the waters of a stream is dependent upon the capacity of the first ditch before such subsequent appropriation is made. When an owner or possessor of land makes an appropriation of water in excess of the needs of the particular portion of the land upon which he conveys the water, and other portions of his land also require irrigation, his water right is not limited by the requirements of the particular fraction. He may still, despite the fact that another’s water right has attached, construct other ditches through his remaining land, provided that the total amount of water conveyed by all the ditches on his place does not exceed the original capacity of the first ditch. As between his appropriation and the subsequent water right, the capacity of the ditch, by means of which he first made his appropriation is the test of the extent of it. (Citing a case.) Under this rule, the extent of the right of the first appropriator is measured by the capacity of the original ditch. After the use has been installed, however, if the capacity of the ditch exceeds the amount required for reasonable use, the necessity for the use and not the size of the ditch, is the measure of the extent of the right (citing cases). The tendency of recent decisions of the courts in the arid states is to disregard entirely the capacity of the ditch and regard the actual beneficial use, installed within a reasonable time after the appropriation has been made, as the test of the extent of the right.”

48 Mont. at 443-44, 138 P.2d 1096.

The foregoing cases and many others serve to illustrate that what is preserved to owners of appropriated or decreed water rights by the provision of the 1972 Constitution is what the law has always contemplated in this state as the extent of a water right: such amount of water as, by pattern of use and means of use, the owners or their predecessors put to beneficial use. Thus an owner may have a decreed right to a certain number of miner’s inches of water; or a statutory appropriative right to a stated amount; or a right depending upon mere use; or even a prescriptive right to a stated amount; nonetheless, the Water Use Act contemplates that all water rights, regardless of prior statements or claims as to amount, must nevertheless, to be recognized, pass the test of historical, unabandoned beneficial use. (Abandonment, of course, is a separate fact issue to be determined if necessary by the water court.) To that extent only the 1972 constitutional recognition of water rights is effective and will be sustained.

We come then to the requirement by the legislature of the inclusion in the decrees as to each existing water right “the amount of water, rate and volume included in the right.” Section 85-2-234(5), MCA. It is apparent to us that the legislature, cognizant as it was of the duties imposed upon it by the Montana Constitution, and of the confirmation and recognition in the Constitution of existing water rights, did not intend by the inclusion of the “volume” requirement as to water irrigators to place an additional burden upon their water rights.

On the other hand, the quantification of the total water rights in the State of Montana is an expressed and necessary objective under the Constitutional mandate for centralized records and is within the police power of the state. Tulare Irr. Dist. v. Lindsay Strathmore Irr. Dist. (1935), 3 Cal.2d 489, 45 P.2d 972, 988. Especially quantification is necessary so that the total amount of water necessary for beneficial uses may be considered in determining other inflow stream rights, and reserved rights, if any.

Always to be borne in mind is that no matter how the water right is expressed in the decrees of the water court, either in flow rate or in acre feet or a combination thereof, such expression of amount is not the final determining factor. It is best expressed in the statutes of other states: beneficial use shall be the basis, the measure and the limit of all rights to the use of water. See for example, Section 73-1-3, Utah Codes Annot.

We are guided in this matter by the decision of the California Supreme Court in Tulare Irr. Dist. v. Lindsay-Strathmore Irr. Dist., supra, a case involving a dispute between riparian owners and appropriators. The Superior Court had before it water rights based on flow rate, which if taken under continuous flow would far exceed the available amount of water in the stream. The Court pointed out that junior appropriators have a material interest in having the ultimate quantity to be received by those who have prior claims fixed with reasonable certainty and for that reason determined that the awards of rights should be fixed in cubic feet per second, with a maximum limitation in acre-feet “measured, of course, by the maximum number of acre-feet used by each appropriator in the past.” 45 P.2d at 997.

In oral argument, counsel for McDonald contended that if an appropriator who formerly used floor irrigation switched to sprinkler irrigation, the appropriator would be using less water than his original appropriation allowed him. If, by reason of excessive utility rates or otherwise, the appropriator decided to return to flood irrigation, and to abandon the sprinkling, he would be deprived under an acre-feet decree of a water right guaranteed to him by the Constitution. In our view, such an appropriator would be in no different position than an appropriator, who in wet years, though entitled to 400 miner’s inches of water for 60 days, used only 200 inches for 30 days. There is no doubt that he would have the right to return in dry years to the full extent of his appropriation provided he was putting the water to a beneficial use.

It was also contended by others on oral argument that in dry periods such as Montana has been experiencing in recent years, the subsoil moisture disappears, and a greater volume of water is necessary to replace the subsoil moisture and to provide remunerative crops for which an acre-feet award might be short. In that case the acre-feet volume expressed in his water right decreed by the Water Court would give way to his right to an appropriation of such flow-rate of water as would be necessary to provide the beneficial use to which the appropriator was historically entitled.

The rule which will serve to guide the courts and appropriators before and after the decrees of the Water Courts is again expressed in Tulare, supra:

“An appropriator, as against subsequent appropriators, is entitled to the continued flow to the head of his ditch of the amount of water that he, in the past, whenever that quantity was present, has diverted for beneficial purposes, plus a reasonable conveyance loss, subject to the limitation that the amount be not more than is reasonably necessary, under reasonable methods of diversion, to supply the area of land theretofore served by his ditch. The appropriator is limited to reasonable beneficial uses. A reading of the many cases on the law of appropriation indicates a gradual and consistent tightening of the rule measuring the rights of appropriators. The early cases measured the appropriator’s right by the capacity of his ditch, but that rule has long since been repudiated in this state. Smith v. Hawkins, 120 Cal. 86, 52 P. 139. As the pressure of population has led to the attempt to bring under cultivation more and more lands, and as the demands for water to irrigate these lands have become more and more pressing, the decisions have become increasingly emphatic in limiting the appropriator to the quantity reasonably necessary for beneficial uses. (Citing cases.) If the appropriator uses more than the amount so required, he gains no right thereto. An excessive diversion of water for any purpose cannot be regarded as a diversion for a beneficial use. Insofar as the diversion exceeds the amount reasonably necessary for beneficial purposes, it is contrary to the policy of the law and is a taking without right and confers no title, no matter for how long continued. (Citing cases.) In determining what is a reasonable quantity for beneficial uses, it is the policy of the state to require within reasonable limits the highest and greatest duty from the waters of the state . . . .”

45 P.2d at 997.

The case before us illustrates the wisdom of the legislature in providing for preliminary decrees. Section 85-2-231, MCA. By the use of a preliminary decree, the Water Court, over a period of one or more seasons may test the provisions of its decree to determine that it works fairly and properly as between appropriators and between appropriators and those with other interests. Such other modifications as may be necessary can be made before the entry of the final decree.

We hold therefore that the Water Courts in rendering a preliminary decree under Section 85-2-231, MCA, or a final decree under Section 85-2-234, MCA, must as to each pre-1973 irrigation water right state the amount of water, rate and volume included in the right; but that the amount, rate and volume must at all times be subject to the requirement of beneficial use. Thus if in a rare case a beneficial use under a pre-1973 water irrigation right required a greater amount of water than the acre feet fixed in the decree, and such beneficial use was within the pre-1973 flow-rate appropriation as to the pattern of use and means of use, the amount required by beneficial use would control, though it exceeded the acre feet fixed in the decree. In like manner, if the beneficial use required a lesser amount than the acre feet fixed therein, the appropriator holds no title or right to the excess volume of water over and above the requirements of his beneficial use.

All must recognize that we live in a state with great fluctuation and uncertainty in the amount of water available. It will become a hazard of living under the judgments of the Water Courts that the parties determine their rights to the flow as it exists. Where volumes cannot be made more definite, as they are contained in judgments, we will repair, as always, to the concept of beneficial use in determining rights subject, of course, to the priorities established by law.

In so holding, we place no added burden on the owners of pre-July 1, 1973 irrigation water rights, nor do we offend the provisions of Art. IX, Section 3(1), of the 1972 Montana Constitution. Flow rate contained in Water Court decrees must still be expressed in cubic feet per second, as they had earlier been expressed, and in the long run the amount actually needed for beneficial use within the appropriation will be the basis, the measure and the limit of all water rights in Montana as between appropriators, and as between appropriators and others.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, WEBER, GULBRANDSON and HUNT and HON. LEONARD LANGEN, District Judge, sitting for MR. JUSTICE MORRISON concur.

ON PETITION FOR REHEARING

MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

I.

The State of Montana, through the Attorney General, has petitioned for rehearing on the grounds: (1) that the stipulation entered into between the parties for submission of the issue contemplated further briefing and argument by the parties; and, (2) that certain “dictum” in the opinion will “render meaningless the volume aspect of final decrees as to direct flow irrigation rights not historically decreed or defined by volume.”

As decided in the original opinion of February 21, 1986, counsel for the various parties appeared and presented to this Court a stipulation that had been entered into by the parties for the purpose of resolving the several issues raised by the respective parties in this case.

In the stipulation of the parties presented on February 21, 1986, it is stated:

“12. Count I of the McDonald complaint requests the Montana Supreme Court declare unconstitutional the requirements of Title 85, Chapter 2, Part 2, MCA, requiring quantification of water rights by volume, as violating the recognition and confirmation of such water rights as they existed on the effective date of Article IX, Section 3, of the 1972 Constitution of Montana.
“13. To the extent that no controverted issues of fact are involved, the parties agree that the constitutionality of Title 85, Chapter 2, Part 2, MCA, and specifically Section 85-2-234(5)(b), MCA, which requires the decreeing of volume for pre-July 1, 1973 direct flow irrigation water rights that have not been historically decreed or defined in terms of volume, should be expeditiously decided by the Montana Supreme Court as the issue is pending in Cause No. 85-468. ’’(Emphasis added.)

The Attorney General and counsel for some of the parties in other cases which had been earlier consolidated with this cause now contend that paragraph 13 of the stipulation was intended solely to encourage the Court’s assumption of original jurisdiction over the issues presented in the McDonald complaint. They also contend that the signatories to the stipulation neither discussed nor intended issuance of a decision by us on the merits without further adversarial briefing and argument by the involved parties.

Paragraph 13 is of the parties own doing. By its wording we were informed that we should expeditiously decide cause No. 85-468 “as the issue is pending.” This Court proceeded to do just that.

The issue of whether the statutory direction that water court decrees include a statement of volume was constitutional had been briefed in advance by petitioners in cause No. 85-468, and responded to by the water courts. It has always been the objective of this Court that these cases involving the determination of water rights by the water courts should be expeditiously handled so that the work of adjudication of all water rights in Montana would not be unduly impeded. It is not likely in view of that objective that this Court would have agreed to a further briefing schedule and further argument in any event.

II.

The Attorney General points to what is designated as “dictum” in the following sentence:

“. . . if in a rare case a beneficial use under a pre-1973 water irrigation right required a greater amount of water than the acre feet fixed in the decree, and such beneficial use was within the pre-1973 flow-rate appropriation as to the pattern of use and means of use, the amount required by beneficial use would control, though it exceeded the acre feet fixed in the decree ...”

McDonald v. State [220 Mont. 519,] 722 P.2d 598, 606, 43 St.Rep. 576, 585.

The asserted dictum relied on by the Attorney General is somewhat out of context. We set forth the full paragraph from which the sentence is lifted:

“We hold therefore that the Water Courts in rendering a preliminary decree under Section 85-2-231, MCA, or a final decree under Section 85-2-234, MCA, must as to each pre-1973 irrigation water right state the amount of water, rate and volume included in the right; but that the amount, rate and volume must at all times be subject to the requirement of beneficial use. Thus if in a rare case a beneficial use under a pre-1973 water irrigation right required a greater amount of water than the acre feet fixed in the decree, and such beneficial use was within the pre-1973 flow-rate appropriation as to the pattern of use and means of use, the amount required by a beneficial use would control, though it exceeded the acre feet fixed in the decree. In like manner, if the beneficial use required a lesser amount than the acre feet fixed therein, the appropriator holds no title or right to the excess volume of water over and above the requirements of beneficial use.”

Id.

Albert W. Stone, appearing amicus curiae, has filed a brief in support of the State’s petition for rehearing. Amicus suggests that the language “the amount, rate and volume must at all times be subject to the requirement of beneficial use” imports a lack of finality, introduces uncertainty, a need for subsequent adjudications, and a result that the doctrine of res judicata is inapplicable to water court judgments.

The water courts themselves have filed an objection to the petition for rehearing, pointing out that the sole issue presented to the Court was whether the statutory requirement to quantify volume for all pre-July 1, 1973 direct irrigation rights was constitutional and that by the opinion, we have determined that such statutory requirement is not unconstitutional. Counsel for the petitioners in cause No.85-468 have filed objections to the petition for rehearing, asserting that this Court had jurisdiction to proceed as it did, and that such counsel had been instructed by clients not to spend any time objecting to the petition for rehearing. Counsel for Washington Water Power Company has not been instructed to take a position on a petition for rehearing.

Perry J. Moore, appearing amicus curiae, finds no such significance in the sentence objected to which would jeopardize the adjudication process.

The concerns expressed by the State and amicus in the petition for rehearing are unfounded. It is the duty of the water court under our opinion and under the law as it has always existed to determine the beneficial use to which the appropriator is entitled for pre-1973 irrigation water rights and based on such beneficial use, to include in the final decree the amount of water, rate and volume included in the respective water rights.

The issue that we have decided in this case is that the inclusion in water court decrees of a stated volume of water expressed in acre feet per year on a pre-1973 decree or appropriated water right is constitutionally permissible. We stated that the water courts, in view of the 1973 constitutional confirmation of then existing water rights, should accord such flow rates, volumes and amounts which recognize the constitutionally protected extent of such rights.

Under our opinion, in no case could the amount of water for beneficial use exceed the amount constitutionally protected for the water right holder. In no case could the priorities of water rights be disturbed. As a corollary, in no case could the expression of volume in acre feet in the water court decrees delimit or burden the pre-1973 protected beneficial use under such water rights.

Our opinion does not reach to those water rights existing before 1973 which were expressed in terms of volume or acre feet. Our opinion deals with pre-1973 water rights which had not historically been expressed in terms of acre feet or volume. In so holding, we expressed nothing new or drastic in Montana law:

“The quantity of water which may be claimed lawfully under a prior appropriation is limited to that quantity within the amount claimed which the appropriator has needed, and which within a reasonable time he has actually and economically applied to a beneficial use . . . the principal of beneficial use [being of] paramount importance.”

Allen v. Petrick, et al. (1924), 69 Mont. 373, 376-77, 222 P. 451, 452.

“The extent of an appropriation of water is limited to beneficial use, and this irrespective of greater quantity attempted to be appropriated.”

Jacobs v. City of Harlowton (1923), 66 Mont. 312, 319, 213 P. 244, 245.

In Worden v. Alexander, et al. (1939), 108 Mont. 208, 213-14, 90 P.2d 160, 162, the sole question presented on appeal was the duty of the water awarded by decree in the lower court. This Court cited with approval a statement from Joerger v. Pacific Gas and Electric Co. (Cal.1929), 276 P. 1017, 1024:

“The question of what quantum of water is reasonably required for irrigation is necessary a complicated one, depending, as it does, upon many different conditions. The character of the soil, the area sought to be irrigated, the climatic conditions, the location, quality, and altitude of the lands, the kinds of crops to be raised, and the length of the irrigation season, must all be taken into consideration and weighed, as well as such other conditions as may be peculiar to each particular case. (Citing a case.) Under such circumstances, it is apparent that there can be no exact uniform rule for computing the duty or reasonable quantity of water for irrigation to be applied for all cases alike.”

Indeed the water court seems to have anticipated a similar problem in the carry-over amount necessary in reservoirs. In its “Verification Manual,” page 200, Section 7, it is stated:

“Reservoirs. The existence of a reservoir as part of the irrigation system could mean a right to a greater volume of water than is needed in a year. Since the amount of water diverted for storage will vary each year, the water courts will not attempt to quantify the exact carry-over amount at this stage.
“Calculating the amount of carry-over is difficult and will turn on the physical factors and historical use patterns unique to each water right. As a result for irrigation claims, the decree will specify only that volume of water beneficially used in one year. If a party’s claimed volume exceeds that amount, the court acknowledges the right to continue reasonable historic carry-over water for such beneficial use in subsequent years. This acknowledgment by the courts will be stated in the findings of fact of the preliminary and final decree.
“Therefore, the right-holder with a reservoir will be able to divert and store as much as is beneficial with two limitations. First the stored amounts shall not exceed the volume historically stored for irrigation. Second, the amount carried over cannot exceed the historical passing of the reservoir.”

We examine the contentions of the Attorney General in the petition for rehearing in the light of the foregoing. It is first contended that the volume quantification requirement of Section 85-2-234(5)(b), MCA, is now mere surplusage under our opinion and that post-adjudication administration will be reduced to ad hoc decision-making over beneficial use and entitlement even when use in excess of the amount established in a final decree has admittedly occurred. This contention was answered above, where we stated that the amount of water claimed for beneficial use could in no event exceed the historical flow rate or pattern of use.

The petition further contends that the underlying objective of Section 85-2-234, MCA is the “final and definitive articulation of all existing rights in the use of water in Montana,” and that our dictum contravenes the basic statutory objective. To the contrary, our opinion directs the water courts to follow the mandate of Section 85-2-234 and Section 85-2-231, MCA, by expressing in its decrees “the amount of water, rate and volume, included in the right.”

The petition also contends that the dictum is inconsistent with prior decisions of the Court “which should recognize both the need for and feasibility of setting precise limits on the quantity of particular irrigation uses.” We have answered that contention in the discussion foregoing.

Finally, the petition suggests that “on rehearing, the Court should therefore exclude from consideration the possibility that a decreed volume amount may improperly diminish an existing right.” That, of course, would be impossible in deciding this case. The possibility that a decreed volume amount might improperly diminish an existing right and so be unconstitutional was precisely the issue that brought Esther McDonald and her copetitioners to this court, and it is precisely the issue that the stipulation of all the parties asked us to determine. To uphold the constitutionality of water court decrees relating to pre-1973 irrigation water rights, we had first to determine that such expression of volumes would not diminish or burden such pre-1973 water rights. That issue was the meat of this case.

Having considered the issues raised by the petition for rehearing and the responses of various parties hereto, and having answered the same herein, we deny the petition for rehearing.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, WEBER, HUNT and GULBRANDSON and HON. LEONARD LANGEN, District Judge, sitting for MR. JUSTICE MORRISON, concur.


author: MR. JUSTICE WEBER

text:
    WILLIAM F. RAUCH, JR., individually and as a partner of Sierra Meadows and West Fork Ranch, Plaintiff and Respondent, v. VIOLET MICHEL, Defendant and Appellant.
    No. 85-365.
    Submitted on Briefs Dec. 30, 1985.
    Decided April 9, 1986.
    716 P.2d 617.

      Charles Graveley, Helena, for defendant and appellant.
    Hughes, Kellner, Sullivan & Alke, John F. Sullivan, Helena, for plaintiff and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

Defendant Violet Michel appeals from an order of the Lewis and Clark County District Court entering judgment against her in the amount of $14,297.15. We affirm.

The issues presented for review are:

1. Was the District Court in error in finding that Mr. Rauch, the plaintiff, was not in default on the promissory note?

2. Was it proper for the District Court to award punitive damages to Mr. Rauch?

3. Was the award of attorney fees to Mr. Rauch proper?

This matter was tried before the District Court, sitting without a jury. The uncontroverted facts as found by the court are set out below.

In March 1982, Mr. Rauch, as a partner in Sierra Meadows and West Fork Ranch, purchased land which had formerly been owned by defendant’s son, Mr. Maykuth. A granary owned by Mr. Maykuth had been left on the land. Mr. Maykuth was informed that the granary should be removed.

The next month, Mr. Rauch agreed to purchase a sprinkler system from defendant for $9,000. He made a $1,000 down payment on the sprinkler and agreed to pay the $8,000 balance at 15 percent interest. The sprinkler system was delivered to Mr. Rauch during the latter part of April and first part of May. Later, Mr. Rauch signed a promissory note for the $8,000 balance due on the sprinkler. Mr. Rauch was to receive a bill of sale and clear title to the sprinkler upon payment of the note.

In mid-September, Mr. Rauch had not yet paid off the note. He told defendant that he would borrow enough money to pay off the entire balance due. He also offered to pay $1,000 for the granary, as an alternative to its removal from the property.

On October 6, Mr. Rauch wrote a check to defendant for the total amount due on the sprinkler. The next day he called defendant and informed her of the check, which she told him to mail to her. During that conversation, defendant informed Mr. Rauch that her son, Mr. Maykuth, considered the offer to buy the granary for $1,000 to be an insult. Mr. Rauch responded that he did not really want the granary, and asked again that Mr. Maykuth arrange to move it.

On October 11, defendant had not yet received the check. Mr. Maykuth, acting as defendant’s agent, entered Mr. Rauch’s property and took the sprinkler. At least part of his motivation was to pressure Mr. Rauch into purchasing the granary. In the process of removing the sprinkler, he damaged the door to a storage shed.

Defendant received Mr. Rauch’s check the next day. She made no effort to inform Mr. Rauch that Mr. Maykuth had taken the sprinkler. In addition, she did not offer to return the sprinkler, or the money which had been paid for it.

Mr. Rauch reported to the sheriff’s office that the sprinkler had been stolen. About a week later, Mr. Maykuth called the Rauch phone number and told Mrs. Rauch that he had taken the sprinkler and that he would return it if Mr. Rauch agreed to purchase the granary for an appropriate price.

Mr. Rauch then demanded the sprinkler’s return. It was not returned. Mr. Rauch’s attorney told defendant that Mr. Maykuth was no longer welcome on the Rauch property. Mr. Maykuth was made aware of this. Nevertheless, he entered Mr. Rauch’s property without permission in May 1983 to photograph the lock on Mr. Rauch’s storage shed.

The District Court, among its other detailed findings and conclusions, found that defendant had waived strict enforcement of the promissory note by “failing repeatedly to demand payment of the note in accordance with its terms.” The court also found that defendant, through her agent Mr. Maykuth, had interfered with Mr. Rauch’s peaceable occupation of his home and property by entering the property to take the sprinkler and to photograph the lock on the storage shed. The District Court further awarded attorney fees to Mr. Rauch, finding that defendant’s counter claim sounded in contract and that Mr. Rauch was the prevailing party.

I

Was the District Court in error in finding that Mr. Rauch, the plaintiff, was not in default on the promissory note?

The record shows that the parties originally agreed that Mr. Maykuth would pay off the purchase price of the sprinkler system during 1982. In June, at Mr. Maykuth’s request, Mr. Maykuth signed a promissory note on the sprinkler. The note was backdated to May 1. It provided for monthly payments of $2,000 and interest at 15% per annum, but did not specify the dates on which payments were due. No payment was made or requested for the month of May. Mr. Maykuth requested a $2,000 payment on June 18, and payment was made a few days later. No payments were made or requested in July. A second $2,000 payment was requested on August 23 and received about a week later. On September 23, defendant requested a third $2,000 payment, plus $391.23 in interest. Mr. Rauch conveyed to defendant his intention to borrow money to pay off the entire amount due. On October 7, defendant told Mr. Rauch to mail the balance due to her, rather than deliver it personally. She received the check for the balance on October 12.

Defendant is in the peculiar position of arguing that Mr. Rauch was in default on the note, when the evidence establishes that she had agreed to accept the check she received on October 12 as the final payment. The Uniform Commercial Code provisions on commercial paper are applicable. Section 30-3-604, MCA, provides that “[a]ny party making tender of full payment to a holder when or after it is due is discharged to the extent of all subsequent liability for interest, costs, and attorney’s fees.” The defendant agreed by phone to accept $4,391.23 as full payment of the note, and asked that payment be mailed rather than hand-delivered. Mr. Rauch sent her a check for the total amount agreed upon, $4,391.23.

The District Court found that Mr. Rauch was not in default. We conclude that the District Court may properly be affirmed on this issue.

II

Was it proper for the District Court to award punitive damages to Mr. Rauch?

Defendant argues that the award of punitive damages is improper because this is a contract action. Mr. Rauch’s amended complaint requested punitive damages for the removal of the sprinkler from his property, which he characterized as a conversion. The District Court’s conclusions state that it awarded $5,000 in punitive damages as a punishment for the “breach of defendant’s obligation, not arising from the contract she broke, to allow the Plaintiff peaceable occupation of his home and property” and for “Defendant’s refusal to return either the spray system or the money ($5,000) paid down on it,” both of which the court found “oppressive and malicious.”

Punitive damages are proper in an action for a breach of an obligation “not arising from contract where the defendant has been guilty of oppression, fraud, or malice.” Section 27-1-221(1), MCA. The breach of defendant’s obligation to allow Mr. Rauch “peaceable occupation of his home and property” does not arise from contract. This Court has approved the award of punitive damages in similar situations where there was malicious conduct. In Butcher v. Petranek (1979), 181 Mont. 358, 593 P.2d 743, this Court affirmed a jury award of $20,000 in punitive damages. Where the defendant had maliciously rammed a pickup truck into plaintiff’s horse and driven a road grader across a section of plaintiff’s wheat field. This Court also upheld the award of punitive damages in a case in which the defendant maliciously destroyed a gate and approach on plaintiff’s property and intimidated plaintiff with threats of bodily harm. Toeckes v. Baker (1980), 188 Mont. 109, 611 P.2d 609.

The Court found that part of Mr. Maykuth’s motivation in entering the Rauch property and taking the sprinkler was to force Mr. Rauch to buy the granary. The defendant did not hold a security interest on the sprinkler under the Uniform Commercial Code. As a result, defendant had no right under the UCC to repossess the sprinkler, even if the payment obligation had been delinquent. The defendant as the holder of a promissory note was not entitled to repossess the sprinkler under any condition. Without right or justification, and only a few days after having been told that full payment was in the mail, the defendant’s agent went upon the Rauch property and took the sprinkler, damaging the door of Mr. Rauch’s storage shed. The District Court awarded Mr. Rauch $300 for damages to the door. Even though she had received the final payment, the defendant did not offer to return either the sprinkler or the final payment. Additionally, when defendant’s agent entered the Rauch property to photograph the shed lock, he was aware of the request that he stay off the property. It is true that the District Court did not specifically find that the taking of the sprinkler constituted a conversion. Apparently, that was based 'upon the contractual arrangement under which final title was not to be passed to the Mr. Maykuth until full payment had been made. The record contains substantial evidence to support the conclusion of the District Court that the defendant’s trespass upon Mr. Rauch’s property was malicious.

We affirm the District Court’s award of punitive damages.

III

Was the award of attorney fees to Mr. Rauch proper?

The District Court awarded attorney fees to Mr. Rauch in the amount of $4,246.12, representing the proportion of total attorney fees allocable to the sprinkler system issue. Defendant contends that this award of attorney fees is not provided for by contract, by statute, or by case law.

The District Court’s award of attorney fees is based on a provision in the promissory note for the sprinkler and on the reciprocity provision at Section 28-3-704, MCA. The promissory note contained the language “[t]he makers and endorsers . . . agree to pay reasonable attorney’s fees in case of default on this note.” Section 28-3-704, MCA, provides that:

“[w]henever, by virtue of the provisions of any contract . . . one party to such contract . . . has an express right to recover attorney fees from any other party to the contract... in the event the party having the right shall bring an action upon the contract. . . then in any action on such contract... all parties to the contract. . . shall be deemed to have the same right to recover attorney fees and the prevailing party in any such action, whether by virtue of the express contractual right or by virtue of this section, shall be entitled to recover his reasonable attorney fees from the losing party or parties.”

The effect of Section 28-3-704, MCA, is to give a reciprocal right to attorney fees to all parties to a contract which provides for attorney fees. Compton v. Alcorn (1976), 171 Mont. 230, 235, 557 P.2d 292, 296. Defendant’s counterclaim was an action for damages for breach of the contract represented by the promissory note. The District Court found that this action was sufficiently within the realm of contract actions to qualify under Section 28-3-704, MCA, and held that Mr. Rauch, as the prevailing party, was entitled to attorney fees on that portion of the action. We affirm the decision of the District Court.

Affirmed.

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


text:
    STATE OF MONTANA, Plaintiff and Respondent, v. SERENA TONKOVICH, a/k/a Serena Earley, Defendant and Appellant.
    No. 85-415.
    Submitted on Briefs Jan. 23, 1986.
    Decided April 9, 1986.
    716 P.2d 615.
    C.F. Mackay, Anaconda, for defendant and appellant.
    Mike Greely, Atty. Gen., Patricia Schaefer, Asst. Atty. Gen., Helena, John N. Radonich, Co. Atty., and Marjorie L. Thomas, Deputy Co. Atty., Anaconda, for plaintiff and respondent.
   MR. JUSTICE WEBER

delivered the Opinion of the Court.

Serena Tonkovich appeals from her conviction of aggravated assault in the District Court for the Third Judicial District, Deer Lodge County. We affirm.

The sole issue raised on appeal is whether there is substantial evidence to support the findings and conclusions of the District Court.

This case was tried to the District Court rather than to a jury, and the court prepared extensive findings of fact, many of which are basically uncontroverted. The court found that Serena Tonkovich and the victim, Rita Lee, had once been friends, but for almost two years had not been on speaking terms. On the evening of this incident, both women were bar-hopping in Anaconda. Each of them presented testimony that she was trying to avoid the other that evening. At the time of the incident, Rita Lee had just walked out of a bar and Serena Tonkovich was outside in her car. Serena shot a .25 caliber automatic pistol at Rita Lee, wounding her in the leg.

At trial, Serena Tonkovich raised a defense of self-defense. She argues that she met her burden of proof, which she correctly states as raising a reasonable doubt as to her guilt. State v. Cooper (1979), 180 Mont. 68, 73, 589 P.2d 133, 136. However, our function on appeal is not to determine whether she raised a reasonable doubt as to her guilt, but to determine the sufficiency of the evidence to support her conviction. The standard of review is whether, viewing the evidence in the light most favorable to the State, there is substantial evidence to support the conviction. State v. Lamb (Mont. 1982), 198 Mont. 323, 646 P.2d 516, 518, 39 St.Rep. 1021, 1024. Disputed questions of fact and the credibility of witnesses will not be considered on appeal. State v. DeGeorge (1977), 173 Mont. 35, 38, 566 P.2d 59, 60.

Serena Tonkovich’s testimony was that she was afraid of Rita Lee, that she had started her car to leave but it had stalled, that Rita Lee and another woman were coming toward her yelling obscenities, that she though Rita had something in her hand, and that she attempted to warn Rita Lee away by shooting at the ground in front of her. She was then able to get her car started, and drove away.

The testimony relied upon by the District Court included the following: Rita Lee testified that she went outside the bar to get some fresh air because she was feeling ill. She testified that she was alone and did not have anything in her hands. She heard a car engine rev and then recognized the car as Serena Tonkovich’s. She saw Serena, who was in the driver’s seat, point a gun at her and shoot twice. Serena then drove away. During this time, Serena Tonkovich’s male friend was standing next to Serena’s car, between the car and Rita Lee. He testified that he saw Rita Lee come out of the bar, and that he saw nothing in her hand. After he heard the shots, he told Serena she was stupid for firing the gun, and went into the bar.

In resolving the conflicting testimony, the District Court concluded that:

“[t]he facts conclusively demonstrate that there was no imminent threat of an attack by the victim, Rita Lee, or even the appearance of the necessity for the use of deadly force, or any physical peril to the Defendant, Serena Tonkovich . . . since no words were spoken, no threat issued and the Defendant was in her automobile, with a friend . . . who had previously demonstrated his willingness to prevent any type of confrontation between the Defendant and others, including the victim, Rita Lee.”

The District Court held that Serena Tonkovich was not justified in using force likely to cause death or serious bodily harm. The record contains substantial evidence to support the findings of fact and conclusions of the District Court. We therefore affirm the judgment of the District Court.

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


author: MR. JUSTICE MORRISON MR. JUSTICE HARRISON,

text:
    GYPSY HIGHVIEW GATHERING SYSTEM, INC., Petitioner and Appellant, v. ROBERT L. STOKES, Respondent and Respondent.
    No. 85-423.
    Submitted on Briefs Jan. 30, 1986.
    Decided April 10, 1986.
    716 P.2d 620.
    Frisbee, Moore & Stufft, John P. Moore, Cut Bank, for petitioner and appellant.
    Murphy, Curtis and Burk, R.L. Stoney Burk, Choteau, for respondent and respondent.
   MR. JUSTICE MORRISON

delivered the Opinion of the Court.

Gypsy Highview Gathering System, Inc. (GHGS), appeals the July 3, 1985, order of the Ninth Judicial District Court, County of Glacier, affirming a decision of the Board of Labor Appeals awarding unemployment compensation benefits to its employee, Robert L. Stokes. We affirm.

Robert Stokes was hired by GHGS as a gas plant employee on November 15, 1982. Stokes had previously worked seven years at another gas plant. His starting monthly wage at GHGS was $1500. After three months, Stokes received a $100 a month raise. Over the course of the next year, Stokes allegedly complained repeatedly to his employer about his wage and about working conditions at the plant. In November of 1983, Stokes requested a $400 a month raise. His employer requested that Stokes wait until February, when his salary would increase to an amount closer to that of the national standard. On February 1, 1984, Stokes’ pay check reflected another $100 a month raise. Stokes quit his job that same day.

On February 13, 1984, Stokes filed a claim seeking unemployment benefits. On the claim form, Stokes listed his main reasons for quitting as: “working conditions, safety of equipement, (sic) lack of safety equipment — substandard. Told employer wages were too low for work performed (aver. nat. scale $2500.00/month) & condition of equipement (sic) (also alone during shift handling acid gases - H2S). Employer would not raise wages.”

Stokes was initially determined to be ineligible for unemployment benefits on February 23, 1984, for the following reasons:

“You voluntarily left your employment because of dissatisfaction with the working conditions. The evidence in the record does not establish the conditions were substandard or detrimental to your well-being. Your separation was without good cause.”

Stokes sought a redetermination, following which his claim was again denied on March 20,1984. The redetermination deputy stated:

“Your past employer maintains that the inspections made by the Quality Air Control Bureau and the EPA showed no problems in the working conditions. Additionally, the insurance inspection passed. All inspections were done during this past month. He further states that goggles were available in the office for workers.
“. . . Your employer further states that you were hired at $1500 per month and advised that this wage would increase to $1600 at the end of the 3 month probationary period. The information in the record does not establish that the employment was union employment nor does it show that you were promised a specific wage increase to $2371 per month.
“The work is not shown to be unsuitable and the decision dated 2/ 23/84 remains in effect.”

Stokes appealed that decision to an appeals referee, claiming that the inspections were performed after Stokes’ termination. A telephone hearing was had April 9, 1984, following which the redetermination denying benefits to Stokes was affirmed.

Next, Stokes appealed to the Board of Labor Appeals. Another telephone hearing was had June 5, 1984. Stokes, John Moore, attorney for GHGS, Lloyd Peterson, Stokes’ supervisor while employed at GHGS, and A.A. Arras, Jr., controller of GHGS, participated. The Board of Labor Appeals, by a two-to-one vote, reversed the previous rulings and held Stokes to be entitled to unemployment benefits. In so holding, the Board found that Stokes quit his employment because of low wages and dangerous working conditions. The board then held that:

“[T]he evidence does not justify the conclusion that the claimant had good cause for leaving insofar as the salary question is concerned ... On the other hand the evidence before the Board establishes that during a period from November 11, 1979 through January 14, 1984 there were eight injuries in the employment where claims were made to the Workers Compensation Division. During that period of time 14 people were employed at the place of employment of the claimant. In addition to that on November 29, 1983, it was pointed out to the employer by the Department of Health and Environmental Sciences of the State of Montana that they had been in violation, at least since 1982, in connection with permit requirements, insofar as making emissions into the atmosphere, particularly S02 emissions. The evidence further establishes that after an inspection by the Occupational Safety and Health Administration, it was determined that written standard operating procedures governing the selection and use of respirators was not established and that self-containing breathing apparatus was not provided at the plant site. The testimony of the claimant further establishes that there were additional shortages of safety equipment immediately available to employees working in the place of employment. After a walk around inspection on April 10,1984, conducted by the Occupational Safety and Health Administration, it was determined that the employer should plumb in an eyewashing facility, should install an H2S alarm system in the scrubbing tower room and should establish a written respiratory program. That under all of the circumstances and considering the nature of the occupation within which the claimant was working where hazardous chemicals are in the working environment and to which the employees are often exposed the claimant had good cause for leaving the employment.”

It became GHGS’s turn to appeal, this time to the District Court of the Ninth Judicial District. In an opinion reflecting the trial judge’s frustration with the standard controlling his review of the Board’s order, substantial evidence was found to support the Board’s decision. GHGS now appeals to this Court, raising the following two issues:

1. Is the finding of “good cause for leaving employment” supported by substantial evidence?

2. Was Stokes justified in quitting his job on the basis of substantial evidence in the record?

The Montana Administrative Procedures Act does not apply to Board of Labor Appeals’ decisions. City of Billings v. Montana Board of Labor Appeals (Mont. 1983), [204 Mont. 38,] 663 P.2d 1167, 1169, 40 St.Rep. 648, 649. Rather, Section 39-51-2410(5), MCA, sets forth the scope of judicial review of the Board’s decisions.

“(5) In any judicial proceeding under 39-51-2406 through 39-51-2410, the findings of the board as to the facts, if supported by evidence and in the absence of fraud, shall be conclusive and the jurisdiction of said court shall be confined to questions of law. Such action and the questions so certified shall be heard in a summary manner and shall be given precedence over all other civil cases except cases arising under the workers’ compensation law of this state.”

This statutory standard of review has been examined and discussed in a number of cases. See for example, Jordan v. Craighead (1943), 114 Mont. 337, 136 P.2d 526; Noone v. Reeder (1968), 151 Mont. 248, 441 P.2d 309; Kirby Co. of Bozeman, Inc. v. Employment Security Division (Mont. 1980), 614 P.2d 1040, 37 St.Rep. 1255; City of Billings, supra; and Dick Irvin, Inc. v. Montana Department of Labor (Mont. 1983), [207 Mont. 336,] 673 P.2d 1271, 40 St.Rep. 2086.

In Kirby, 614 P.2d at 1042-1043, 37 St.Rep. at 1257, this Court stated:

“Under the plain meaning of this statute and the case law interpreting it, the District Court must treat the findings of the Board as conclusive, if the findings are supported by the evidence and in the absence of fraud. Noone v. Reeder (1968), 151 Mont. 248, 252, 441 P.2d 309. The District Court should, therefore, limit its review of the findings of the Board to a consideration of whether they are supported by the evidence.”
“Supported by the evidence” means supported by substantial evidence. Substantial evidence is something more than a scintilla of evidence, but may be less than a preponderance of the evidence. In fact, we held in Jordon v. Craighead, 114 Mont. at 343, 136 P.2d at 528:
“Thus the sole question for the court with relation to the evidence is one of law, namely, whether the findings are supported by substantial evidence, regardless of whether there is also substantial evidence or even a preponderance of evidence to the contrary.”

The same standard applies to this Court when reviewing a decision of the Board of Labor Appeals. Applying this standard, we find substantial evidence to affirm the decision of the Board.

Every fact, except one, relied on by the Board in making its determination that the working conditions at GHGS were unsafe is supported by evidence presented to the Board. The exception is the Board’s finding that no self-contained breathing apparatus was available for the employee’s use. This finding is incorrect. Appellee’s exhibit No. 2, a report from the Occupational Health and Safety Administration, states that although such an apparatus is available at the plant, no written procedure regarding its use is available. This one error does not, however, substantially alter the evidence supporting the Board’s conclusions that an unsafe working environment existed.

Appellee’s Exhibit No. 6 indicates that since the opening of the plant in 1979, there have been in fact eight accidents which merited the filing of a workers’ compensation claim.

Appellee’s Exhibit No. 4 is a letter from the United States Environmental Protection Agency informing GHGS that it was in violation of certain standards governing the emission of S02 into the atmosphere. This exhibit confirms Stokes’ allegation that he was exposed to poisonous gases while employed at GHGS.

The OSHA report, discussed above, recommends that GHGS: 1) install an eye-washing facility; 2) install an H2S alarm system; and 3) establish a written respirator program.

Appellant would have us examine other evidence in support of its claim that working conditions at the plant were safe. However, it is not our job to weigh conflicting evidence presented to the Board. We must only determine whether there is evidence to support the Board’s findings.

Thus the real question becomes whether the working conditions were so unsafe that Stokes had good cause for terminating his employment. Again we must defer to the decision of the Board. The evidence indicates numerous safety and health violations by GHGS. The Board, with its expertise in the area, is in the better position to determine what is and is not safe. Further, an employee need not wait to be seriously injured before acting to remove himself from an unsafe working environment. There is substantial evidence to support the Board’s decision that Stokes had good cause to quit his job at GHGS.

Affirmed.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HUNT and GULBRANDSON concur.

MR. JUSTICE HARRISON,

dissenting:

I dissent. Viewing the facts of this case as liberally as I can in favor of the respondent, the prevailing party below, I fail to find substantial evidence to justify a decision supporting a finding of “good cause” by the Board of Labor Appeals. The plaintiff here quit his job because he didn’t get a raise in wages he thought he should get. He now shakes the unemployment fund for benefits I feel he is not entitled. It is interesting to note that there were three separate hearings on this claim and two previous referees denied the claim before the action of the Board setting on a third hearing. Here in addition to drawing down unemployment payments, the plaintiff has in addition income from his general store, a post office and farming operations. It is little wonder we are having problems financing the fund with these kinds of awards!