author: JUSTICE NELSON

text:
    DAVID HERRON and VIVIENNE HERRON, Plaintiffs and Appellants, v. SCHUTZ FOSS ARCHITECTS, JERRY SCHUTZ, and CONTINENTAL CASUALTY COMPANY, Defendants and Respondents.
    No. 96-308.
    Submitted on Briefs October 24, 1996.
    Decided March 25, 1997.
    54 St.Rep. 258.
    282 Mont. 94.
    935 P.2d 1104.

      See C. J.S. Insurance § 430.
    For Appellants: William D. Jacobsen, Thompson & Jacobsen, Great Falls; Channing J. Hartelius, Hartelius, Ferguson, Baker & Kazda, Great Falls.
    For Respondents: Guy W. Rogers, Tiffany B. Lonnevik, Brown, Gerbase, Cebull, Fulton, Harman & Ross, Billings (Continental Casualty Company); Paul D. Miller, Holland & Hart, Billings (Schütz Foss Architects and Jerry Schütz).
   JUSTICE NELSON

delivered the Opinion of the Court.

This is an action for declaratory judgment on issues concerning the limits of liability coverage available under a claims-made insurance policy. The District Court for the Twelfth Judicial District, Liberty County, entered Summary Judgment in favor of the insurer, Continental Casualty Company (Continental), and against the plaintiffs, David and Vivienne Herron (the Herrons). The Herrons appeal. We affirm.

We address the following issues on appeal:

1. Did the District Court err in granting Continental's Motion for Summary Judgment on the issue of which policy applies to the Herrons’ claims?

2. Did the District Court err in granting Continental’s Motion for Summary Judgment on the issue of the general limits of liability applicable to the Herrons’ claims?

3. Did the District Court err in granting Continental’s Motion for Summary Judgment on the issue of the specific limits of liability applicable to the Herrons’ claims?

Factual and Procedural Background

During 1990 and 1991, Jerry Schütz and Schutz-Foss Architects (Schütz) designed an addition to and were remodeling the Liberty County Hospital and Nursing Home (the Hospital) in Chester, Montana. David Herron was the maintenance supervisor at the Hospital. On October 30, 1991, Herron was performing a maintenance check on the roof of the Hospital when he slipped on some ice and fell, injuring himself.

On January 22,1992, Herron wrote Schütz to express his concerns about the unsafe method required to access the roof. In a list of complaints about the building, Herron referenced his fall, stating that “I have discovered this unsafe condition myself having slipped off this area, injuring my back.” In his letter, Herron made no demand for money or otherwise indicate that he intended to hold Schütz responsible for his damages, nor did he request that Schütz contact his insurance carrier.

On July 12, 1993, Herron’s attorney, Channing Hartelius (Hartelius), wrote a letter to Schütz stating that his office represented Herron as to the October 30,1991 accident. Hartelius requested that Schütz contact his malpractice insurance carrier and ask them to contact Hartelius’ office immediately to discuss “this claim.”

Mary Schütz forwarded Hartelius’ letter to Baker Insurance (Baker), their local claims adjuster, on July 14, 1993. Baker completed a General Liability Notice of Occurrence/Claim form that same day. The form indicated that no claim had been made prior to Hartelius’ letter. The form also indicated that the policy governing Herron’s claim was the policy in effect from March 1,1993, to March 1, 1994. The form listed the “Date/Time of Occurrence” as July 12, 1993, the same date noted as the “Date of Claim.”

Baker subsequently forwarded the claim to Cindy Michel (Michel), Professional Liability Claim Specialist, at Continental. Continental had insured the architectural firm for professional liability since March 1,1986. The policy also covered Jerry Schütz, individually, to the extent he acted as an agent of the firm. The policy issued to the firm was renewed on an annual basis, with the policy period running from March 1st of each year to March 1st of the following year.

Until the 1994-1995 policy year, the policy carried liability limits of $100,000. These were aggregate limits applicable to all claims made during the policy year. In other words, there was only $100,000 available to satisfy all claims made during a policy year, not $100,000 for each separate claim. Beginning with the 1994-1995 policy year, Schütz purchased increased coverage, upping the policy’s aggregate limits to $1,000,000 for claims made during that policy year.

Michel completed a Claim Coding Form on August 6, 1993. On September 9, 1993, Michel wrote Hartelius requesting his theory of liability regarding the architectural design of the Hospital along with documentation of Herron’s injuries and any medical treatment he may have received.

On October 7, 1993, Hartelius responded by letter to Michel’s request. He alleged that Schütz was negligent when he breached his duty of ordinary care as an architect. Hartelius asserted that Schütz knew or should have known that “his design of the roof and accessibility to the penthouse were negligent.”

Michel wrote Hartelius on February 8,1994, denying liability and declining to make an offer for Herron’s claim. On October 19, 1994, Herron and his wife filed a personal injury and loss of consortium action against Schütz alleging numerous deficiencies in the design and construction of certain aspects of the Hospital’s roof.

The dispute eventually centered on which policy covered the Herrons’ claims and, consequently, which limits of liability applied. The Herrons filed a Complaint for Declaratory Judgment on June 9,1995, requesting that the District Court resolve the disputed issues. Continental filed a Motion for Summary Judgment on January 24,1996, arguing that the applicable policy was the one in effect from March 1, 1993, to March 1, 1994, under which the policy limits were $100,000, but, after factoring in payments made on other claims during that policy year, the remaining limits were only $20,742.94. The Herrons filed a Motion for Summary Judgment on February 7, 1996, contending that the applicable policy was the one in effeet from March 1,1994, to March 1, 1995, under which the policy limits were $1,000,000.

Both motions were argued on March 18, 1996. On April 19,1996, the District Court granted Continental’s motion ruling that the 1993-1994 policy applied and that the Herrons’ claims are subject to the remaining policy limits of $20,742.94 for the 1993-1994 policy year. The Herrons appeal.

Standard of Review

Our standard in reviewing a grant of summary judgment is the same as that initially used by the district court. Dagel v. Farmers Ins. (1995), 273 Mont. 402, 405, 903 P.2d 1359, 1361 (citing Youngblood v. American States Ins. Co. (1993), 262 Mont. 391, 394, 866 P.2d 203, 204). Summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Rule 56(c), M.R.Civ.P; Dagel, 903 P.2d at 1361.

In Montana, the interpretation of an insurance contract is a question of law. Dagel, 903 P.2d at 1361 (citing Wellcome v. Home Ins. Co. (1993), 257 Mont. 354, 356, 849 P.2d 190, 192). We review a district court’s conclusions of law to determine if the court’s interpretation of the law is correct. Dagel, 903 P.2d at 1361 (citing Nimmick v. State Farm Mut. Auto. Ins. Co. (1995), 270 Mont. 315, 319, 891 P.2d 1154, 1156).

Issue 1.

Did the District Court err in granting Continental’s Motion for Summary Judgment on the issue of which policy applies to the Herrons’ claims?

The District Court determined that the July 12, 1993 letter from Hartelius to Schütz constituted a claim. Hence, the court granted Continental’s Motion for Summary Judgment concluding that the 1993-1994 policy, along with that policy’s limits of liability, which had been diminished to $20,742.94, applied to the Herrons’ claims.

The Herrons contend that the 1994-1995 policy, along with that policy’s $1,000,000 limits of liability, apply in this case because they did not make a claim until they filed their personal injury and loss of consortium action against Schütz on October 19,1994. The Herrons maintain that the July 12,1993 letter was not a claim because it did not make a “demand for money or services” as the term “claim” is defined in the policy. Furthermore, they contend that if the July 12, 1993 letter is considered a claim, then the January 22, 1992 letter from Herron to Schütz must also be considered a claim, thereby implicating the 1991-1992 policy with its $100,000 limits of liability undiminished by any prior claims.

The term “claim” is defined at section IV of the policy as “the receipt of a demand for money or services, naming you and alleging a wrongful act.” The Herrons maintain that Hartelius’ letter merely informed Schütz that Hartelius was representing Herron with regard to the accident and asked Schütz to contact its malpractice carrier. They assert that no demand of any kind was set forth as required by the policy.

The Herrons argue that the language in the policy is ambiguous, thus Montana law requires that the terms of the policy be construed liberally in favor of the insured and strictly against the insurer. However, it is not the policy language that is ambiguous, it is the wording of the July 12th letter. As the District Court stated in its Order on Motions for Summary Judgment, “[t]he rule that an insurance policy is to be construed against the insurance company does not carry over to construction of correspondence from a claimant’s lawyer.” If the language in an insurance policy is clear and explicit, the policy governs. See § 28-3-401, MCA.

The question here is whether the July 12th letter constituted a “demand for money or services” as required by the policy. In the only Montana case that discusses what constitutes the making of a claim under a claims-made insurance policy, Walker v. Larson (1986), 223 Mont. 333, 727 P.2d 1321, this Court held that the letters in question did constitute a claim although the policy in that case, unlike the policy in the instant case, failed to define a claim.

The Herrons cite to a New York case, In Re Ambassador Group, Inc. Litigation (E.D.N.Y. 1993), 830 F.Supp. 147, to support their contention that the July 12th letter was not a “demand for money or services.” In Ambassador, the policy at issue did not define the term “claim” and the court in that case held that neither of the two letters in question constituted a claim as that term is normally viewed. Notwithstanding, Ambassador is distinguishable from the instant case in that the holding in Ambassador was based on the notice provisions in the policy. The policy characterized the reporting of a “claim” to the insurer as giving notice and the reporting of a “claim” directly to the directors and officers as the making of a claim. Thus the letters in question, because they were sent to the insurer, did not constitute a claim.

While the authority on this issue is divided, we conclude that the better reasoned authority holds that letters, like the one in the instant case, are claims. In Berry v. St. Paul Fire & Marine Ins. Co. (8th Cir. 1995), 70 F.3d 981, the Eighth Circuit Court of Appeals ruled that a letter asking the company to forward information to its insurance carrier qualified as a claim even though it lacked a request for damages in a specific dollar amount. There the policy defined a claim as a “demand in which damages are alleged.” The court in that case stated:

True, the letter does not request payment of a specific dollar amount, but sometimes complaints in actions actually filed in Court don’t either, so this omission does not seem inconsistent with the letter’s being treated as a “claim.” Treating the letter as other than a claim, it seems to us, requires a tortured construction of its text.

Berry, 70 F.3d at 982.

Furthermore, in Rentmeester v. Wisconsin Lawyers Mut. (Wis.App.1991), 473 N.W.2d 160, a case involving the same insurer, Continental, and the same definition of a claim as in the case before us on appeal, the Court of Appeals of Wisconsin held that a letter from the claimant’s attorney requesting the insured to contact his insurance carrier was a claim even though the letter did not contain a specific request for damages. The Wisconsin court stated:

[The] letter could only mean that the Rentmeesters planned to seek relief from Hinkfuss if they lost on appeal. Moreover, not only did [the plaintiff’s attorney] term his demand “a claim,” this is the precise construction that Hinkfuss gave the letter.

Rentmeester, 473 N.W.2d at 163.

The Herrons contend that Continental’s argument in the instant case that the letter is a claim shows that the policy is ambiguous because Continental’s argument is exactly opposite to its argument in Rentmeester. On the contrary, as the District Court stated in its order, Continental’s assertions in Rentmeester do not bind it here, “[i]t is the result, not the argument, that has precedential value.” Continental asserts in its brief on appeal that it is not unusual for a party to take a different position in one case than it did in a previous case and that this is particularly appropriate where the court in an earlier case rejects the party’s argument. Continental contends that since the Wisconsin court struck down Continental’s coverage argument in Rentmeester, it is only proper that Continental accept the law set forth in that case and adopt it as its position here.

The Herrons maintain that the July 12th letter only implies that a claim will be forthcoming at some point in the future. They assert that they did not make a claim until they filed their personal injury and loss of consortium action on October 19, 1994. Contrary to the Herrons’ assertions, filing the action was not sufficient to bring the claim within the 1994-1995 policy year. The policy states that coverage exists during that period when a claim is first made against the company. Filing the complaint was simply the continued pursuit of David Herron’s claim originally asserted in July 1993.

Where the alleged tortfeasor has reasonably been put on notice by the injured party that he intends to hold the tortfeasor responsible for his damages, it would, indeed, be anomalous to hold that a claim is, nevertheless, not made until a suit is actually filed. To do so would encourage litigation as opposed to negotiation and settlement. And, to the extent that the tortfeasor had a claims-made policy in force when he was notified, but did not have such insurance in force when the lawsuit was filed — perhaps a year or more later — then coverage would be frustrated altogether to the detriment of both the injured party and the tortfeasor.

Furthermore, § 25-4-311, MCA, mandates that in actions for the recovery of money or damages for personal injury or wrongful death, the amount of damages sought may not be stated in the claim for relief. Thus, under the Herrons’ interpretation of the policy language, their complaint, because it did not state a specific dollar amount, could not be considered a claim either.

Even though there was no request for a specific dollar amount in the July 12th letter, the text on its face indicates that the Herrons were seeking compensatory payment, otherwise, there would be no reason for Schütz to contact his insurance carrier. As the District Court pointed out in its order, “[w]hy else would a plaintiff’s lawyer write to an alleged tort-feasor, ask him to contact his insurance carrier and say a claim exists, other than to make a demand for money damages.”

Moreover, both sides treated the matter as a claim for money damages. In addition to initially labeling the Herrons’ demand as a “claim,” Hartelius referenced Continental’s claim number in subsequent correspondence. Mary Schütz, believing the July 12th letter to be a claim, forwarded it to Baker on July 14,1993. Anotice-of-claim form was completed that same day and forwarded to Continental. Michel acknowledged the new claim by letter dated August 10,1993, and addressed to Mary Schütz. On August 30, 1993, Hartelius provided additional information regarding the claim to Baker. Thereafter, Michel sent a letter to Hartelius requesting additional documentation regarding Schutz’s alleged liability and Herron’s injuries. Hartelius responded to this request by letter dated October 7, 1993, in which he included Herron’s medical records and gave detailed accusations of Schutz’s negligence. Nevertheless, Continental denied the claim on February 8, 1994. Taking into consideration Hartelius’ letters of July 12th, August 30th, and October 7th, all of which were written and sent during the 1993-1994 policy year, clearly a claim was made.

The Herrons argue that if we hold that the July 12, 1993 letter from Hartelius to Schütz constitutes a claim, then we must also hold that the January 22,1992 letter from Herron to Schütz constitutes a claim, thus implicating the 1991-1992 policy. However, the January 22,1992 letter did not direct Schütz to contact his insurer carrier, nor did it indicate in anyway that the Herrons intended to hold Schütz responsible for David Herron’s injuries. Thus the letter does not reasonably fit within the policy definition of a claim. The reason for the January 22nd letter was simply to point out defects Herron perceived in the design and construction of the Hospital. It neither stated nor implied any other purpose.

Accordingly, we hold that the District Court was correct in concluding that the July 12,1993 letter from Hartelius to Schütz was a claim under the policy and that the 1993-1994 policy applies to the Herrons’ claims.

Issue 2.

Did the District Court err in granting Continental’s Motion for Summary Judgment on the issue of the general limits of liability applicable to the Herrons’ claims?

The Herrons argue that under the 1994-1995 policy, the $1,000,000 limits of liability apply to their claims. They maintain that the endorsement in the 1994-1995 policy restricting coverage to a maximum of $100,000 when a claim is made prior to March 1, 1994, or when the policy holder had knowledge prior to that time of a wrongful act or circumstance which might result in a claim, is ambiguous and violates the reasonable expectations doctrine as well as public policy. However, since we have already determined that the 1993-1994policy applies to the Herrons’ claims rather than the 1994-1995 policy, we need not decide this issue.

Issue 3.

Did the District Court err in granting Continental’s Motion for Summary Judgment on the issue of the specific limits of liability applicable to the Herrons’ claims?

The District Court concluded that the Herrons’ claims are subject to the remaining policy limits of $20,742.94 for the 1993-1994 policy year. The Herrons argue to the contrary, contending that regardless of when their claim was made, they are entitled to the liability limits in effect at the time of the wrongful act and those limits have not been diminished by payments on other claims.

The Herrons maintain that because the stated limits in effect during the 1993-1994 policy year and the stated limits in effect at the time of the wrongful act are identical and since the policy fails to define which set of limits will apply in that event, under the accepted rules of policy construction, the limits which provide the greatest degree of coverage — the undiminished limits in effect at the time of the wrongful act — must apply. They base their contention on the provision at section 111(A)(1) of the policy, which provides:

Our obligation to pay is further limited to:
a. the amount of the limit of liability in effect at the time of the actual or alleged wrongful act, or
b. the amount stated as the limit of liability for this policy term, whichever is less.

The Herrons maintain that, because the two limits are equal, this language in the policy creates an ambiguity and any ambiguity must be construed in their favor.

Contrary to the Herrons’ assertions, we perceive no ambiguity in the policy language. The Herrons fail to note the policy language immediately preceding the policy provision cited by them, which states:

The limit of liability shown on the Declarations is the maximum we will pay for any one or more claim [sic] made during this policy term. This limit applies as excess over any deductible amount.

It is clear from this language in the policy that the maximum limit of liability for all claims made in any policy period is the purchased coverage, which in this case was $100,000. Continental then further limits its liability, in the provision cited by the Herrons, for acts which occurred before the policy period to the amount of insurance in effect at the time of the act. This prevents an insured who has a potential liability from increasing the limits before the claim is actually made.

Since Continental has limited its coverage for all claims made during the policy year to $100,000 and since it has already paid out nearly $80,000 on prior claims during the 1993-1994 year, the Herrons are limited to the remaining policy limits of $20,742.94 for the 1993-1994 policy year. We agree with the District Court that it is troubling that the amount of insurance coverage is limited here just because the claim happened to be made at an inopportune time, but, this is a problem that occurs with claims-made policies. However, as the District Court stated, “[e]ven insurance companies have the right to rely on the clear language of their policies.”

Accordingly, we hold that the District Court did not err in granting Continental’s Motion for Summary Judgment on the issue of the specific limits of liability applicable to the Herrons’ claims.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES HUNT and GRAY concur.


source: Caselaw Access Project

author: JUSTICE TRIEWEILER

license: Public Domain

text:
    DARLEEN H. DOIG, Plaintiff and Respondent, v. GORDON D. CASCADDAN and JOAN L. CASCADDAN, husband and wife, Defendants and Appellants.
    No. 96-373.
    Submitted on Briefs January 9, 1997.
    Decided March 25, 1997.
    54 St.Rep. 263.
    282 Mont. 105.
    935 P.2d 268.

      See C.J.S. Costs § 125.
    For Appellants: Gregory W. Duncan; Harrison, Loendorf, Poston & Duncan; Helena.
    For Respondent: Thomas A. Budewitz; Attorney at Law; Helena.
   JUSTICE TRIEWEILER

delivered the Opinion of the Court.

The respondent, Darleen H. Doig, filed a complaint for declaratory judgment in the District Court for the First Judicial District in Broadwater County. The appellants, Gordon D. Cascaddan and Joan L. Cascaddan, counterclaimed and sought damages for various alleged breaches of contract. Following a trial by jury, the District Court entered judgment for Cascaddans in the amount of $1,000, and awarded attorney fees to Doig as the prevailing party. Cascaddans appeal. We affirm the judgment of the District Court.

The issues on appeal are:

1. Did the District Court err when it denied Cascaddans’ motion to allow extrinsic evidence to impeach their own witness?

2. Did the District Court err when it granted Doig’s motion for a directed verdict and dismissed Cascaddans’ claim pertaining to water rights?

3. Did the District Court err when it held that Doig is the prevailing party and, on that basis, awarded her attorney fees?

FACTUAL BACKGROUND

Doig was the owner of real property in Broadwater County. In 1992, she entered into a buy-sell agreement with Cascaddans. The terms of the agreement specify that, at closing, Cascaddans would receive a warranty deed secured by a mortgage, and that the remaining balance due would be paid according to the terms of a promissory note.

Furthermore, the agreement contains: (1) a provision which required Doig to clean up the property; and (2) a liquidated penalty clause which would apply if Doig failed to comply with the clean-up provision. The agreement also states:

If either party hereto finds it necessary to institute an action at law, to employ an attorney to protect or enforce any of the rights created hereunder ... the prevailing party shall be entitled to recover from the other party a reasonable attorney’s fee ....

Closing took place on August 14,1992, and pursuant to the terms of the agreement, Cascaddans took possession of the property on August 1, 1993.

Cascaddans subsequently complained to Doig that she had not complied with the terms of their agreement. On March 3,1994, they sent her a letter which stated:

Because of your failure to respond, the Cascaddans have decided to reduce their remaining principal balance due under their note to you by the sum of $20,000 ....

In response, Doig filed a complaint for declaratory judgment in which she requested the District Court to enter:

[A] judgment that [Doig] is not in breach of any of the terms of the contract between the parties and further declaring that [Cascaddans’] obligations to make all payments provided for in said contract remain in full force and effect.

Accompanying her complaint was an offer of judgment in the amount of $2,500.

Cascaddans counterclaimed and sought approximately $20,000 in damages. Specifically, they claimed that Doig breached the contract when she: (1) removed shop walls, shelving, and certain three inch and two inch irrigation pipe; (2) created a fence problem; and (3) failed to remove certain items from the property. Furthermore, based on her alleged failure to clean up the property, Cascaddans sought to collect a monetary penalty pursuant to the contract’s liquidated penalty clause.

Subsequently, Doig sent Cascaddans a check in the amount of $906 for replacement of the missing shop wall. After Cascaddans returned the check to her, she filed another offer of judgment in the amount of $3,406.

On August 3, 1995, the District Court granted Doig’s motion for summary judgment on Cascaddans’ claim for damages pursuant to the liquidated penalty clause. Trial by jury was scheduled to commence on December 11,1995; however, on December 1,1995, Cascaddans retained new counsel and moved for a continuance. They also filed motions to add a third-party claim and to amend their counterclaim to allege that Doig breached the contract when she failed to convey certain water rights. The District Court denied the motion to add a third-party claim, but granted the motion to amend the counterclaim. Cascaddans’ amended counterclaim sought damages in the amount of approximately $40,000. Trial by jury began on February 26, 1996.

At trial, Cascaddans contended that Doig breached the contract when she failed to convey water rights. As part of their case, they sought to establish the value of those water rights by eliciting the following testimony from Donald Shearer:

Q. And was it - did Doig ever offer to sell those water rights to you?
A. Yes.
Q. And did he offer to sell you the second and the fourth water right?
A. I think the second right.
Q. Was the fourth right associated with that at all?
A. I don’t believe so, but I’m not sure at this point.
Q. What did he offer to sell you that right for?
MR. BUDWEITZ [Doig’s counsel]: Object now because what he’s asking, apparently attempting to do is establish a value of the second water rights, which he got, they got it.
THE COURT: If I’m not mistaken, and I’ll ask Mr. Shearer, the second water right that you and Mr. Doig were discussing, that is the water right that the Cascaddans currently have, is it not?
A. I think so.
THE COURT: Okay. Sustained.

After Cascaddans completed the presentation of their evidence, they moved the District Court to allow them to use extrinsic evidence — the testimony of Darryl Strombaugh — to impeach Shearer’s trial testimony. The District Court denied their motion.

At the conclusion of all the evidence, Doig moved for a directed verdict regarding several of Cascaddans’ counterclaims. The District Court concluded that, with regard to the water rights, the improper location of the fence, and the missing pieces of two-inch pipe, Cascaddans had not provided sufficient evidence to establish their damages. Accordingly, it granted Doig’s motion for a directed verdict with regard to those counterclaims.

As a result of the directed verdict, the damage claims which were submitted to the jury were for the total amount of $17,240. The jury returned a verdict in favor of Cascaddans in the amount of $1,000.

After trial, both parties moved for attorney fees. The District Court determined that Doig is the “prevailing party” and, on that basis, awarded her attorney fees.

ISSUE 1

Did the District Court err when it denied Cascaddans’ motion to allow extrinsic evidence to impeach their own witness?

When we review a district court’s evidentiary ruling, the standard of review is whether the district court abused its discretion. Glacier National Bank v. Challinor (1992), 253 Mont. 412, 415, 833 P.2d 1046, 1048.

At trial, Cascaddans asserted that Doig breached the contract when she failed to convey certain water rights. In support of their claim, Cascaddans presented Donald Shearer who testified as follows with regard to the value of the disputed water rights:

Q. And was it — did Doig ever offer to sell those water rights to you?
A. Yes.
Q. And did he offer to sell you the second and the fourth water right?
A. I think the second right.
Q. Was the fourth right associated with that at all?
A. I don’t believe so, but I’m not sure at this point.

After Cascaddans completed the presentation of their evidence and rested their case, they asserted, outside the presence of the jury, that Shearer’s trial testimony contradicted prior statements he made to their attorney. They claimed that previously Shearer stated that Doig offered to sell him two water rights (both the “second” and the “fourth” rights), and not just the one Cascaddans had already received. They further claimed that a third party, Darryl Strombaugh, heard Shearer’s prior inconsistent statements and that he could testify for impeachment purposes. On that basis, they moved the District Court to allow them to use extrinsic evidence to impeach Shearer’s testimony. The District Court denied the motion.

On appeal, Cascaddans contend that the District Court erred when it denied their motion to use extrinsic evidence (the testimony of Darryl Strombaugh) to impeach Donald Shearer. Specifically, they assert that, pursuant to Rule 607, M.R.Evid., they have the right to impeach any witness, including their own.

Cascaddans’ interpretation of Rule 607, M.R.Evid., is correct. However, their argument on appeal overlooks the equally important Rule 613 which states, in relevant part:

(b) Extrinsic evidence of prior inconsistent statement ofwitness. Extrinsic evidence of a prior inconsistent statement by a witness is not admissible unless the witness is afforded an opportunity to explain or deny the same and the opposite party is afforded an opportunity to interrogate the witness thereon ....

Rule 613(b), M.R.Evid. (emphasis added); see also State v. Pease (1986), 222 Mont. 455, 462, 724 P.2d 153, 157.

In this case, Cascaddans failed to comply with Rule 613(b), M.R.Evid. They did not question Shearer regarding his alleged prior inconsistent statement, and provided him no opportunity to explain or deny that it was made. In fact, their motion to introduce extrinsic evidence for impeachment purposes was not made until after Shearer had been dismissed as a witness, and after they had completed the presentation of their evidence and rested their case.

Therefore, pursuant to Rule 613(b), M.R.Evid., Darryl Strombaugh’s impeachment testimony was not admissible. Accordingly, we hold that the District Court did not err when it denied Cascaddans’ motion to impeach Shearer by offering that testimony.

ISSUE 2

Did the District Court err when it granted Doig’s motion for a directed verdict and dismissed Cascaddans’ claim pertaining to water rights?

A motion for a directed verdict is governed by Rule 50, M.R.Civ.P., which states, in relevant part:

(a) Judgment as a matter of law.
(1) If during a trial by jury a party has been fully heard with respect to an issue and there is no legally sufficient evidentiary basis for a reasonable jury to have found for that party with respect to that issue, the court may grant a motion for judgment as a matter of law against that party on any claim, counterclaim, cross-claim, or third party claim that cannot under the controlling law be maintained without a favorable finding on that issue.

Rule 50(a)(1), M.R.Civ.P. Furthermore, we have previously held that a motion for a directed verdict may be granted only when it appears as a matter of law that the nonmoving party could not recover upon any view of the evidence, including the legitimate inferences to be drawn therefrom. Wilkerson v. School Dist. #15, Glacier County (1985), 216 Mont. 203, 211, 700 P.2d 617, 622.

Cascaddans’ amended counterclaim asserted that Doig breached the contract when she failed to convey certain water rights. At the close of all the evidence, Doig moved the District Court for a directed verdict with regard to that claim. The District Court granted Doig’s motion based on its conclusion that:

[T]he problem is, there’s not one iota of evidence here as to the amount of damages. So even if the jury doesn’t figure it out and I have to determine it, there’s nothing for me to figure. I have to use the evidence that you’ve presented. There’s no evidence at all what these [water rights] are worth.

On appeal, Cascaddans contend that there was, in fact, sufficient evidence from which the jury could have established a value for the disputed water rights.

Section 27-1-311, MCA, provides the measure of damages for breach of contract:

For the breach of an obligation arising from contract, the measure of damages, except when otherwise expressly provided by this code, is the amount which will compensate the party aggrieved for all the detriment which was proximately caused thereby or in the ordinary course of things would be likely to result therefrom. Damages which are not clearly ascertainable in both their nature and origin cannot be recovered for a breach of contract.

Section 27-1-311, MCA (emphasis added).

After a thorough review of the record, we conclude that Cascaddans failed to offer any evidence of damages with regard to that part of their counterclaim which alleged that Doig failed to convey water rights. Therefore, Cascaddans’ alleged damages were “not clearly ascertainable in both their nature and origin” and, concomitantly, there was no basis upon which the jury could calculate damages or even determine if there were, in fact, any damages.

Accordingly, we hold that the District Court did not err when it granted Doig’s motion for a directed verdict and dismissed Cascaddans’ water rights counterclaim.

ISSUE 3

Did the District Court err when it held that Doig is the prevailing party and, on that basis, awarded her attorney fees?

The parties’ contract specifically addresses the issue of attorney fees and expressly states:

If either party hereto finds it necessary to institute an action at law, to employ an attorney to protect or enforce any of the rights created hereunder ... the prevailing party shall be entitled to recover from the other party a reasonable attorney’s fee ....

(Emphasis added.) With regard to the recovery of attorney fees, the parties’ agreement is clear and the District Court is bound by its terms. In re Marriage of Caras (1994), 263 Mont. 377, 385, 868 P.2d 615, 620.

After trial, both parties moved for attorney fees. In its order determining the prevailing party, the District Court concluded:

Upon consideration of all of the circumstances, the Court has determined that ... Doig is the prevailing party and is therefore entitled to recover a “reasonable attorneys fee ....”

We must, therefore, determine whether the District Court erred when it concluded that “Doig is the prevailing party.” When we review a district court’s conclusions of law, the standard of review is whether those conclusions are correct. Carbon County v. Union Reserve Coal Co. (1995), 271 Mont. 459, 469, 898 P.2d 680, 686.

On appeal, Cascaddans contend that they are, in fact, the “prevailing party” and therefore, that the District Court erred when it awarded attorney fees to Doig. Specifically, they make the following argument: (1) the jury found that Doig breached the contract and that Cascaddans suffered damages in the amount of $1,000; (2) the jury did not award any damages to Doig, and therefore; (3) Cascaddans received a “net judgment” of $1,000. On that basis, Cascaddans assert that they are the “prevailing party’ and are entitled to attorney fees.

It is undisputed that Cascaddans are the only party who received a money judgment. However, as we have previously held, that fact is not dispositive:

No one factor should be considered in determining the prevailing party for the purpose of attorney fees. The party that is awarded a money judgment in a lawsuit is not necessarily the successful or prevailing party. However, this Court agrees with those jurisdictions that have found the award of money to be an important item to consider when deciding who, in fact, did prevail.

E.C.A. Env. Mgmt. Serv. Inc. v. Toenyes (1984), 208 Mont. 336, 345, 679 P.2d 213, 217-18.

Therefore, while the District Court was required to consider the Cascaddans’ receipt of a $1,000 judgment, that is not the only fact that warrants consideration. After a review of the record, we conclude that the following facts were also necessarily taken into consideration and support the District Court’s conclusion that Doig is the prevailing party: (1) the litigation was precipitated by Cascaddans’ March 3, 1994, letter to Doig in which they threatened to withhold future payments in the amount of $20,000; (2) on two separate occasions, Doig filed an offer of judgment in an amount greater than the amount which Cascaddans ultimately recovered; (3) Cascaddans’initial counterclaim sought approximately $20,000 in damages; (4) the District Court granted summary judgment in favor of Doig and dismissed that part of Cascaddans’ counterclaim based on the liquidated penalty clause; (5) Cascaddans’ amended counterclaim, which sought approximately $40,000 in damages, added allegations that Doig breached the contract when she failed to convey water rights; (6) the District Court granted Doig’s motion for a directed verdict pertaining to Cascaddans’ two-inch pipe, fence relocation, and water rights counterclaims; (7) as a result of the directed verdict, Cascaddans’ damage claims were reduced to approximately $17,000; and (9) ultimately, the jury verdict was for only $1,000.

Accordingly, we hold that, based on the totality of circumstances and facts in this case, the District Court did not err when it concluded that Doig is the prevailing party and, on that basis, awarded her attorney fees.

The judgment of the District Court is affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES NELSON, REGNIER and GRAY concur.


author: JUSTICE LEAPHART

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. ALBERT D. BARTLETT, Defendant and Appellant.
    No. 96-174.
    Submitted on Briefs January 16, 1997.
    Rehearing Denied April 17, 1997.
    Decided April 1, 1997.
    54 St.Rep. 268.
    282 Mont. 114.
    935 P.2d 1114.

      See C.J.S. Criminal Law § 554.
    For Appellant: William F. Hooks, State Appellate Defender, Helena.
    For Respondent: Honorable Joseph P. Mazurek, Attorney General; Jennifer Anders, Assistant Attorney General, Helena; Robert M. McCarthy, County Attorney, Butte.
   JUSTICE LEAPHART

delivered the Opinion of the Court.

Appellant Albert D. Bartlett appeals from the January 26, 1996 Judgment of the Second Judicial District Court, Silver Bow County, finding him guilty of criminal possession of dangerous drugs with intent to sell, in violation of § 45-9-103(1), MCA (1993), and sentencing him to twenty years to the Department of Corrections. We affirm.

We consider the following issues on appeal:

1. Did the District Court violate Bartlett’s due process rights by finding him competent to stand trial?

2. Did the District Court violate Bartlett’s right to counsel by failing to appoint counsel immediately upon remand?

3. Did the District Court violate Bartlett’s due process rights when it ordered that the mental health evaluation report be placed in the District Court file?

Factual and Procedural Background

Bartlett was charged with criminal possession of dangerous drugs with intent to sell in December 1993. After his court-appointed attorney withdrew from the case, Bartlett unsuccessfully attempted to retain private counsel. Thereafter, Bartlett indicated that he wanted to represent himself. Following a hearing, the District Court allowed Bartlett to proceed pro se. The court appointed standby counsel to assist Bartlett.

At an omnibus hearing, standby counsel requested a psychiatric evaluation of Bartlett to determine his competency to stand trial and whether he suffered from a mental disease or defect. Bartlett opposed this motion and it was denied by the District Court. Bartlett proceeded to trial and was convicted. At the sentencing hearing, standby counsel presented evidence that Bartlett had previously been diagnosed as having chronic undifferentiated schizophrenic disorder. Bartlett was sentenced to the Department of Corrections for twenty years.

On appeal, Bartlett challenged the District Court’s decision to allow him to represent himself at trial. He also challenged the court’s ruling denying standby counsel’s request for a mental health evaluation. This Court found the latter issue to be dispositive and, finding reversible error, remanded for further proceedings consistent with its opinion. State v. Bartlett (1995), 271 Mont. 429, 898 P.2d 98.

After this Court issued its opinion, but before remittitur had issued, the District Court, sua sponte, issued an order for a mental health evaluation of Bartlett pursuant to § 46-14-202, MCA. Bartlett appeared before the District Court with standby counsel and the court informed him that he would be transferred to Warm Springs State Hospital for the evaluation process. While at the state hospital, Bartlett refused to participate in the evaluation. In accordance with § 46-14-206(2), MCA, the mental health evaluator prepared a report which indicated that Bartlett was unwilling to participate and, that in the evaluator’s opinion, Bartlett’s unwillingness was not the result of a mental disease or defect. The report indicated that the mental health evaluator was aware of Bartlett’s previous diagnosis of schizophrenic disorder.

After the evaluation at the state hospital, Bartlett appeared in the District Court with standby counsel for the purpose of determining whether he would submit to another mental health evaluation and whether he wanted to represent himself. Bartlett admitted that his refusal to participate in the mental health evaluation was a conscious choice. The court advised Bartlett that if he continued to refuse a mental health evaluation, the court would find him competent to proceed based on the limited observations of the staff at the state hospital and on the record already before the court from the prior proceedings. Bartlett indicated that he understood this fact. After the court engaged Bartlett in a discussion concerning his ability to represent himself and after Bartlett refused to decide whether to represent himself, the court allowed Bartlett several more days to make his decision.

The hearing was reconvened three days later. When the court asked whether Bartlett wished to have standby counsel as his court-appointed counsel, Bartlett stated that he did not, but that he also did not want to represent himself. As the court was explaining that Bartlett’s only choice was between having standby counsel serve as court-appointed counsel or representing himself, Bartlett threatened standby counsel and had to be removed from the courtroom. After Bartlett was removed, standby counsel expressed concerns about Bartlett’s competency and requested the court to allow the state hospital to make a determination as to whether Bartlett was competent to proceed. The court took standby counsel’s request under advisement and subsequently issued an Opinion and Order appointing new counsel and finding Bartlett competent to stand trial. The court left open the possibility that it would grant a second motion for a mental health evaluation.

During a hearing on pretrial matters, the court informed the defense that it would permit a motion for a mental health evaluation on condition that Bartlett would cooperate. The defense was given four days in which to file a motion for a mental health evaluation.

Defense did not make a motion for a mental health evaluation prior to trial. Bartlett was convicted by jury trial on December 20, 1995 and the District Court sentenced him to the Department of Corrections for twenty years. Bartlett appeals the conviction.

Discussion

Bartlett alleges that the manner in which the competency evaluation was conducted and the District Court’s finding that he was competent to stand trial were in error. He further alleges that the District Court violated his statutory and federal and state constitutional rights by failing to appoint counsel immediately upon remand and by ordering the mental health evaluation report to be placed in the District Court file.

1. Did the District Court violate Bartlett’s due process rights by finding him competent to stand trial?

The standard for determining whether a criminal defendant is fit to proceed to trial is set forth at § 46-14-103, MCA:

A person who, as a result of mental disease or defect, is unable to understand the proceedings against the person or to assist in the person’s own defense may not be tried, convicted, or sentenced for the commission of an offense so long as the incapacity endures.

The trial court must determine “ ‘whether [the defendant] has sufficient present ability to consult with his lawyer with a reasonable degree of rational understanding — and whether he has a rational as well as factual understanding of the proceedings against him.’ ” State v. Santos (1995), 273 Mont. 125, 130, 902 P.2d 510, 513 (citing State v. Austad (1982), 197 Mont. 70, 78, 641 P.2d 1373, 1378)(citing Dusky v. United States (1960), 362 U.S. 402, 402, 80 S.Ct. 788, 789, 4 L.Ed.2d 824, 825). This Court’s standard for reviewing a finding of competence to proceed to trial is whether substantial evidence supports the district court’s decision that the defendant was fit to proceed to trial. Santos, 902 P.2d at 513; State v. Statczar (1987), 228 Mont. 446, 456, 743 P.2d 606, 613.

The State argues that Bartlett waived his right to appeal the competency finding as he failed to raise the issue in the court below, thereby denying the District Court an opportunity to correct the error. Normally, failure to raise an issue in the court below waives the issue for purposes of appeal. Section 46-20-104, MCA; § 46-20-701(2), MCA; State v. Swoboda (1996), 276 Mont. 479, 481, 918 P.2d 296, 298. However, as Bartlett argues, a claim of incompetency cannot be waived by the defendant or his attorney. Speedy v. Wyrick (8th Cir.1984), 748 F.2d 481 (citing Pate v. Robinson (1966), 383 U.S. 375, 86 S.Ct. 836, 15 L.Ed.2d 815). “[I]t is contradictory to argue that a defendant may be incompetent, and yet knowingly or intelligently ‘waive’ his right to have the court determine his capacity to stand trial.”Robinson, 383 U.S. at 384,86 S.Ct. at 841 (citation omitted)(rejecting the State’s claim that accused deliberately waived the defense of competence to stand trial by failing to demand a sanity hearing as permitted under state law). Furthermore, a criminal conviction of a mentally incompetent accused is a violation of substantive due process. Drope v. Missouri (1975), 420 U.S. 162, 95 S.Ct. 896, 43 L.Ed.2d 103. “[D]ue process requires that a hearing be held whenever evidence raises a sufficient doubt about the mental competency of an accused to stand trial.” Griffin v. Lockhart (8th Cir. 1991), 935 F.2d 926, 929 (citing Drope, 420 U.S. at 180, 95 S.Ct. at 908; Pate, 383 U.S. at 378, 86 S.Ct. at 838) (other citation and footnote omitted). The hearing operates as a safeguard to ensure that an accused is not convicted while incompetent. Griffin, 935 F.2d at 929 (citation omitted). A court’s failure to hold a competency hearing when sufficient doubt as to the accused’s competency is raised violates the accused’s due process rights. Moran v. Godinez (9th Cir.1994), 57 F.3d 690, 695. The doubt raised as to an accused’s competency need not come from the defendant or the defendant’s attorney. A court has the duty to order a competency hearing sua sponte if the court has reasonable grounds for concluding that there is a good faith doubt as to a defendant’s competency. Moran, 57 F.3d at 695; United States v. Warren (9th Cir.1993), 984 F.2d 325, 329 (citing Chavez v. United States (9th Cir.1981), 656 F.2d 512, 515). Since the court has an independent duty to ensure that an accused is competent to stand trial, Bartlett could not and did not waive his right to challenge the competency finding on appeal and we will, therefore, address the competency issue.

Bartlett first argues that the District Court lacked jurisdiction to order the mental health evaluation prior to the issuance of the remittitur. Until remittitur is issued, the Supreme Court, not the district court, retains jurisdiction over the case. See State v. Fertterer (1993), 260 Mont. 397, 399, 860 P.2d 151, 153; § 46-20-706, MCA. However, as the State contends, this Court will not reverse a conviction on the basis of an error, defect, or irregularity which does not affect substantial rights. Section46-20-701 (2), MCA. Because Bartlett has failed to demonstrate how the timing of the court’s order violated his substantial rights we decline to find reversible error in the District Court’s order of the mental health evaluation prior to issuance of remittitur.

Bartlett next claims that the District Court erred by failing to conduct a competency hearing. Bartlett argues, and we agree, that where a sufficient doubt is raised as to an accused’s competency to stand trial, the District Court has a duty to sua sponte order a hearing on competency. Moran, 57 F.3d at 695; Warren, 984 F.2d at 329.

After Bartlett refused to cooperate in the mental health evaluation ordered upon remand, the court conducted a pretrial hearing to determine whether Bartlett would cooperate in another mental health evaluation and whether he would represent himself. The court informed Bartlett that it would make a finding of competency based on the limited mental health evaluation and on Bartlett’s conduct at the prior trial if Bartlett refused to participate in a second mental health evaluation. Bartlett claims that this hearing did not qualify as an evidentiary hearing on the issue of competency and that the court erred by failing to hold such a hearing.

We reject this contention for two reasons. First, a hearing is necessary only where “sufficient doubt” is raised as to the accused’s competency. Drope, 420 U.S. at 180, 95 S.Ct. at 908. In the cases cited by Bartlett for this proposition, the courts had before them greater indicia of the accuseds’ incompetency than the District Court had before it in the present case. The indicia included the nature of the crimes, past behavior of the accused, and in some cases, the claimed defense of mental insanity. Robinson, 383 U.S. 375, 86 S.Ct. 836 (finding the accused’s long history of disturbed behavior, including the previous murder of his infant son, the nature of his crime (point-blank murder of his wife in front of many witnesses), and his defense of insanity as raising “sufficient doubt” as to the accused’s competency thereby warranting a hearing); Drope, 420 U.S. 162, 95 S.Ct. 896 (finding the accused’s previous attacks on his wife, his attempt at suicide during his trial, and psychiatrists’ reports on requisite mental state as raising “sufficient doubt” as to accused’s competence thereby warranting a hearing); Speedy, 748 F.2d 481 (finding that the nature and quantum of evidence of incompetence did not raise “sufficient doubt” as to competence so as to require a hearing where the accused’s crime was nothing more than a “crime of passion,” and the accused’s prior bizarre behavior, including a suicide attempt while awaiting trial, was balanced by psychiatrists’ findings of competency).

In the instant case, although there were some indicia of incompetence, such as standby counsel’s concerns as to whether Bartlett was “grounded enough in reality” to stand trial, her request for a competency evaluation, a prior mental health evaluation indicating a mental disorder, and Bartlett’s obstreperous conduct during the —IS------same level of gravity as found in the previously cited cases and, when considered together with the state hospital report indicating that Bartlett’s refusal to cooperate was not a result of a mental disease, do not rise to the level of “sufficient doubt” necessary to require a court to sua sponte order a competency hearing.

Second, and more importantly, the court offered Bartlett the opportunity to undergo a second mental health evaluation from which the court would determine competency, and continued the hearing for three days to allow Bartlett to decide whether he would cooperate and whether he would represent himself. Additionally, the court later offered newly appointed defense counsel the opportunity to request a mental health evaluation. The defense failed to take advantage of the court’s offer.

We hold that 1) the District Court was not presented with sufficient doubt as to Bartlett’s competency so as to require a hearing; and 2) even if there were sufficient doubt as to competency requiring the court to sua sponte order a hearing, the pretrial hearing that was conducted satisfied that requirement, given Bartlett’s unequivocal refusal to cooperate.

Bartlett next claims that the District Court’s finding of competency was flawed by its reliance on improper indicia of competency. The District Court based its finding of competency on the following factors: (1) “the limited evaluation/observations of Defendant at Montana State Hospital pursuant to the Court’s order for mental examination of Defendant,” and (2) “the record which demonstrates Defendant’s -understanding of the charge against him, his ability to fashion a defense to such charge and his conduct of his own defense during the initial trial of this matter.”

When the court directed the state hospital to evaluate Bartlett it instructed that Bartlett’s competency to proceed should be assessed along with a determination as to whether Bartlett could have possessed the requisite mental state to commit the crime. The mental health evaluation report indicated that Bartlett refused to participate in the evaluation and that the evaluator believed that his refusal to cooperate was not the result of a mental disease or defect. The report comported with the mandate of § 46-14-206(2), MCA, which provides:

If the examination cannot be conducted by reason of the unwillingness of the defendant to participate in the examination, the report must state that fact and must include, if possible, an opinion as to whether the unwillingness of the defendant was the result of mental disease or defect.

Bartlett argues that the report failed to separately address competency and that a failure to cooperate may itself be a symptom of mental disorder. Bartlett relies on State v. Bauer (Minn. 1976), 245 N.W.2d 848, 858 (overruled in part on other grounds), for the proposition that it is error to deny further inquiry into an accused’s competency based on a “ ‘classic symptom’ of a paranoidally psychotic individual, [which is] the refusal to cooperate.” In Bauer, the Minnesota Supreme Court set aside a judgment of conviction, in part, because the district court failed to conduct the requisite inquiry into the defendant’s competency. While the court recognized that the defendant’s refusal to cooperate in a psychiatric evaluation could not be the basis for a finding of competency, it stated that only when the refusal to cooperate was the “result of mental disorder” would the defendant be denied his constitutional rights of due process and fair trial. Bauer, 245 N.W.2d at 858.

In the instant case, the state hospital evaluators, apprised of the previous diagnosis of schizophrenic disorder, found that Bartlett’s refusal to cooperate was not the result of a mental disorder. Therefore, the District Court’s reliance on this finding does not contradict the rule in Bauer that a finding of competence based on a defendant’s refusal to cooperate, which is the result of a mental disorder, violates the defendant’s constitutional rights.

Additionally, the court in Bauer ultimately reversed the conviction, not for the district court’s reliance on the defendant’s refusal to cooperate as evidence of competency, but for the district court’s failure to give appropriate weight to the evidence of incompetency, including the public defender’s judgment of incompetence, a cautionary warning from one psychiatrist that although the defendant was presently competent to stand trial his condition may deteriorate during trial, and another psychiatrist’s report, issued after the defendant requested another evaluation, finding the defendant incompetent to stand trial. Bauer, 245 N.W.2d at 858. The court also had before it two separate motions regarding competency brought by the public defender during trial and denied by the district court. Bauer, 245 N.W.2d at 852-53.

In the instant case, the court had none of the indicia of incompetence found in Bauer. Additionally, unlike the defendant in Bauer, whose request for further inquiry into the competence issue was refused by the district court, Bartlett failed to raise the competency issue at trial and, furthermore, did not request another mental health evaluation after being invited to do so by the court.

Above all, Bartlett’s claim that the District Court failed to consider that a failure to cooperate may be a symptom of a mental disorder is without merit because § 46-14-206(2), MCA, incorporates this possibility by providing for a procedure to be followed when a person refuses to participate in a mental health examination. This procedure is not limited to a report on requisite mental state. It applies to the entirety of § 46-14-206(1), MCA, which includes that portion of a report indicating competence to proceed. Section 46-14-206(2), MCA, was designed for the very sort of situation confronted by the District Court. When a defendant refuses to participate in a mental health evaluation, as Bartlett did in the instant case, some procedure must be employed by courts to determine the mental status of the defendant. Section 46-14-206(2), MCA, is that procedure. The evaluator is to make a determination of whether the refusal is a result of a mental disease or defect. The hospital evaluator followed this procedure in making the report on Bartlett. The report states clearly that a “competency assessment interview” that was planned could not be undertaken because of Bartlett’s refusal to participate. The evaluator found that “Mr. Bartlett’s refusal to cooperate with evaluation procedures was not the result of mental illness, but a conscious decision on his part.”

Section 46-14-221, MCA, provides that a report filed under § 46-14-206, MCA, may be relied on by the court to make a determination of a defendant’s fitness to proceed where neither the prosecutor or defense counsel contests the findings.

Although standby counsel stated that she felt competency had not been addressed in the report and requested the court to conduct a second mental health evaluation, Bartlett’s final court-appointed attorney did not obj ect to the findings of the report nor did the defense accept the court’s invitation to request another mental health evaluation.

Pursuant to § 46-14-221, MCA, the court was entitled to rely on the report prepared in conformity with § 46-14-206(2), MCA, in making its finding of competency. Furthermore, although § 46-14-221, MCA, allows the court to rely on the report alone without conducting a separate competency hearing where the findings in the report are not objected to, the court in this case conducted a hearing and gave Bartlett the opportunity to explain his refusal to cooperate and to undergo another mental health evaluation. The court further offered defense counsel the right to seek a mental health evaluation before trial.

Since Bartlett chose not to avail himself of the opportunity to undergo another mental health evaluation, he cannot now complain that the court erred by relying on an inadequate competency evaluation.

If a finding by a mental health evaluator that a defendant’s refusal to cooperate in an evaluation was not the result of a mental disease or defect never justifies a finding of competency, then surely more defendants would simply refuse to participate in evaluations, thereby endlessly stalling criminal proceedings against them.

The report issued by the state hospital pursuant to § 46-14-206(2), MCA, allayed any “substantial doubt” the District Court may have had as to Bartlett’s competency and provided the court with substantial evidence upon which to base its finding of competency. The District Court did not deny Bartlett his due process right to be tried while competent where Bartlett himself failed to avail himself of the opportunity to provide the court with more evidence upon which to decide the competency question.

Bartlett further alleges that the District Court erred in relying on Bartlett’s performance at the first trial and his conduct at the pretrial stage of the second proceedings to find him competent to proceed. Although we recognize the inherent danger in relying on previous conduct to determine a person’s present competency to stand trial, we hold that any error committed by the court in relying on Bartlett’s previous behavior was harmless as the court was entitled to rely on the state hospital report alone in its findings of competency.

We hold that the District Court properly relied on the state hospital report in finding Bartlett competent to proceed to trial. Further, although the court was not presented with “substantial doubt” as to Bartlett’s competency and thus no hearing on competency was required, the pretrial hearing at which Bartlett was offered, and at which he declined to undergo another mental health evaluation, would satisfy such a requirement given Bartlett’s refusal to cooperate.

2. Did the District Court violate Bartlett’s right to counsel by failing to appoint counsel immediately upon remand?

Bartlett claims that the District Court violated his constitutional rights to the assistance of counsel when it failed to appoint counsel immediately after remand and before the court ordered the mental health evaluation. The State, relying on § 46-20-701(2), MCA, contends that we need not address this issue since Bartlett did not make a timely obj ection or argue denial of right to counsel in the lower court. That approach, however, ignores the fact that the right to counsel issue arises in the context of Bartlett’s competency to proceed. As discussed earlier herein, competency to proceed is unique in that it is an issue which need not be raised by the parties. Rather, the court has a sua sponte duty to address the issue if there is sufficient doubt as to the defendant’s competency to proceed. If there is sufficient doubt as to the defendant’s competency, the issue is not obviated by the failure of the defendant to raise the issue or to object. That being the case, it would be incongruous to hold that a defendant whose competency is the subject of inquiry, waived the right to counsel issue by not objecting at the time the court was ordering a mental evaluation. Under the narrow facts presented herein, the issue of right to counsel is inextricably intertwined with the court’s sua sponte obligation to inquire into competency and thus not subject to the “failure to object” procedural bar of § 46-20-701(2), MCA. Accordingly, we will address the right to counsel issue on its merits.

The right to counsel provided by Article II, Section 24 of the Montana Constitution and the Sixth Amendment to the United States Constitution provides an accused person the fundamental right to assistance of counsel. The right to counsel arises at every critical stage of the proceedings against an accused. A “critical stage” is “any step of the proceeding where there is potential substantial prejudice to the defendant.” State v. Finley (1996), 276 Mont. 126, 144-45, 915 P.2d 208, 220 (citing State v. Robbins (1985), 218 Mont. 107, 111, 708 P.2d 227, 231). Bartlett argues that he was prejudiced by the absence of counsel during this “critical” stage of the proceedings in that counsel was not available to discuss the evaluation, the nature and scope of his constitutional rights relative to the evaluation process, or the consequences of his failure to participate in the evaluation. Without answering the question of whether the court’s sua sponte ordering of the mental health evaluation pursuant to this Court’s Opinion in State v. Bartlett constitutes a “critical stage” of the trial, we hold that Bartlett was not prejudiced by the failure to appoint counsel at that stage of the proceedings. Any alleged prejudice suffered by Bartlett was vitiated by the subsequent opportunity to participate in another mental health evaluation with the benefit of counsel’s wisdom regarding the process. In Robbins, we held that where no prejudice resulted from a delay in appointment of counsel, the defendant’s right to counsel was not violated. Robbins, 708 P.2d at 231.

Additionally, “[a]ny error, defect, irregularity, or variance which does not affect substantial rights shall be disregarded [on appeal].” Section 46-20-701(2), MCA. We therefore hold that the District Court’s failure to immediately appoint counsel following remand did not violate Bartlett’s right to counsel.

3. Did the District Court violate Bartlett’s due process rights when it ordered that the mental health evaluation report be placed in the District Court file?

Bartlett alleges that his due process rights were violated by dissemination of the mental health evaluation report to the court and prosecution. However, Bartlett’s attorney did not object to the report’s dissemination before or during trial. The alleged error cannot be raised for the first time on appeal. Section 46-20-104, MCA; State v. Arlington (1994), 265 Mont. 127, 151, 875 P.2d 307, 321. We therefore decline to address this issue.

Conclusion

We hold that the District Court did not err in finding Bartlett competent to stand trial nor in failing to appoint counsel immediately upon remand.

Affirmed.

CHIEF JUSTICE TURNAGE, JUSTICES GRAY, NELSON and HUNT concur.


author: CHIEF JUSTICE TURNAGE

text:
    STATE OF MONTANA, Plaintiff and Respondent, v. DANNY GRUENDEMANN, Defendant and Appellant.
    No. 96-414.
    Submitted on Briefs February 13, 1997.
    Decided April 1, 1997.
    54 St.Rep. 275.
    282 Mont. 128.
    935 P.2d 1110.

      See C.J.S. Criminal Law § 256.
    For Appellant: L. Sanford Selvey II, Chief Public Defender, Billings.
    For Respondent: Honorable Joseph P. Mazurek, Attorney General: Tammy Plubell, Assistant Attorney General, Helena; Dennis Paxinos, County Attorney; John Kennedy, Deputy County Attorney, Billings.
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Danny Gruendemann pled guilty in the Thirteenth Judicial District Court, Yellowstone County, to sexual intercourse without consent. He appeals from the court’s order denying his motion to withdraw that plea. We affirm.

The issues are whether the District Court abused its discretion when it refused to allow Gruendemann to withdraw his guilty plea, and whether the State of Montana is barred from prosecuting Gruendemann for sexual intercourse without consent following his prosecution and conviction in Wyoming for endangering the welfare of children.

On June 21, 1995, Gruendemann met a fourteen-year old girl, A.W., at a convenience store in Laurel, Montana. A.W. informed Gruendemann that she wanted to rim away from home. Graendemann offered to help her, but told her that he wanted to have sex with her first. Gruendemann engaged in sexual intercourse with A. W., who was incapable of legally consenting because of her age.

A.W. then accompanied Gruendemann to Wyoming. On June 24, 1995, Gruendemann and A.W. appeared at a homeless shelter in Casper, Wyoming. They were taken into custody after a shelter worker became suspicious of Gruendemann’s story that A.W. was his daughter. Gruendemann subsequently pled guilty in the State of Wyoming to charges of child endangerment and was sentenced to serve six months in the Natrona, Wyoming, County Jail.

In July 1995, Gruendemann was charged in Yellowstone County District Court with two counts of sexual intercourse without consent upon A.W. outside Laurel, Montana, on or about June 21, 1995. Gruendemann pled guilty to one of those counts in December 1995. He later moved to be allowed to withdraw his guilty plea, based upon his Wyoming conviction. The court denied Graendemann’s motion and sentenced him to serve twenty-five years at the Montana State Prison. Gruendemann appeals.

ISSUE 1

Did the District Court abuse its discretion when it refused to allow Gruendemann to withdraw his plea?

Section 46-16-105(2), MCA, provides that “[a]t any time before or after judgment the cotut may, for good cause shown, permit the plea of guilty to be withdrawn and a plea of not guilty substituted.” In doing so, the court must consider:

1. the adequacy of the court’s interrogation at the time the plea was entered regarding the defendant’s understanding of the consequences of the plea;
2. the promptness with which the defendant attempts to withdraw the plea; and
3. the fact that the plea was the result of a plea bargain in which the guilty plea was given in exchange for dismissal of another charge.

State v. Moddison (1996), 278 Mont. 384, 926 P.2d 253, 257. This Court’s standard of review on a denial of a motion to withdraw a guilty plea is whether the court abused its discretion. State v. Enoch (1994), 269 Mont. 8, 11, 887 P.2d 175, 177.

The record establishes that at the time he entered his guilty plea, Gruendemann was adequately advised as to the consequences of the plea. He does not contend otherwise, except to argue that he was not adequately informed of the consequences of his Wyoming conviction. As to the second factor listed above, the State acknowledges that Gruendemann’s request to withdraw his guilty plea was promptly made prior to his sentencing.

As to factor number three, Gruendemann argues that he has not received any benefits of the plea agreement. The record does not support that argument. In exchange for Gruendemann’s guilty plea, the State dismissed one count of sexual intercourse without consent and agreed to recommend a twenty-five-year prison sentence on the remaining count. In dismissing one of the two counts of sexual intercourse without consent, the State reduced Gruendemann’s maximum potential prison sentence by half, from eighty years to forty years. In light of the nature of Gruendemann’s offense, the bleak results of his psychological and sex offender evaluations (severe and chronic substance abuse, a “morally indiscriminate sexual abuser,” rehabilitation prognosis “quite guarded,” and high risk to reoffend), his criminal history, and the recommendations set forth in the presentence investigation, we conclude that the plea agreement represented a significant benefit to him.

We hold that the District Court did not abuse its discretion in denying Gruendemann’s motion to withdraw his guilty plea.

ISSUE 2

Is the State of Montana barred from prosecuting Gruendemann for sexual intercourse without consent following his prosecution and conviction in Wyoming for endangering the welfare of children?

Section 46-11-504, MCA, provides:

When conduct constitutes an offense within the concurrent jurisdiction of this state and of the United States or another state or of two courts of separate, overlapping, or concurrent jurisdiction in this state, a prosecution in any other jurisdiction is a bar to a subsequent prosecution in this state under the same circumstances barring further prosecution in this state if:
(1) the first prosecution resulted in an acquittal or in a conviction and the subsequent prosecution is based on an offense arising out of the same transaction!.]

The court must determine whether the following three factors are present: (1) the defendant’s conduct constitutes an offense within the jurisdiction of the court where the first prosecution occurred and within the jurisdiction of the court where the subsequent prosecution is pursued; (2) the first prosecution results in an acquittal or a conviction; and (3) the subsequent prosecution is based on an offense arising out of the same transaction. State v. Tadewaldt (1996), 277 Mont. 261, 264-65, 922 P.2d 463, 465. All three factors must be present before a subsequent prosecution is barred. Tadewaldt, 277 Mont. at 265-67, 922 P.2d at 466.

In the present case, the State concedes that the Wyoming prosecution resulted in a conviction, so that factor (2) is present. The parties disagree on whether factors (1) and (3) are present.

Factor (1) is whether the defendant’s conduct constitutes an offense within the jurisdiction of the court where the first prosecution occurred (here, Wyoming) and within the jurisdiction of the court where the subsequent prosecution is pursued (Montana). Gruendemann points out that the State of Montana could have charged him with endangering children, the offense with which he was charged in Wyoming. The State points out that, on the other hand, there is no indication that the State of Wyoming had any basis upon which to charge Gruendemann with sexual intercourse without consent.

Gruendemann cites State v. Zimmerman (1977), 175 Mont. 179, 187, 573 P.2d 174, 179, for the idea that “[t]he measure of concurrent jurisdiction is whether defendant’s conduct subjected him to prosecution in both jurisdictions.” Gruendemann asserts, citing Zimmerman, that if conduct gives rise to offenses chargeable in both jurisdictions, concurrent jurisdiction lies regardless of the particular offense ultimately charged in each jurisdiction.

Zimmerman was charged in Montana state court with multiple counts of embezzlement. While he could have been charged with embezzlement under federal statutes as well, he was instead charged in federal district court with making false statements to secure funds. Zimmerman therefore does not stand for the proposition that concurrent jurisdiction exists when the two jurisdictions lack the ability to charge the same offense. In the present case, as the State has noted, there is no indication that the State of Wyoming had the ability to charge Gruendemann with the offense of which he was convicted in Montana, sexual intercourse without consent. Concurrent jurisdiction did not exist as to that offense.

Because concurrent jurisdiction did not exist, we conclude that we need not address whether factor (3) is present. We hold that § 46-11-504, MCA, does not bar Gruendemann’s prosecution in Montana.

Finally, Gruendemann argues that his conviction in Montana is barred under § 46-ll-503(l)(b), MCA:

(1) When two or more offenses are known to the prosecutor, are supported by probable cause, and are consummated prior to the original charge and jurisdiction and venue of the offenses lie in a single court, a prosecution is barred if:
(b) the former prosecution resulted in a conviction that has not been set aside, reversed, or vacatedU

In order for § 46-11-503, MCA, to apply, venue and jurisdiction of the offenses must lie in a single court. Gruendemann maintains this is true because both offenses could have been charged in Montana district court. But both offenses were not charged in Montana district court — Gruendemann was charged with child endangerment only in Wyoming, not in the “single court” in which he asserts venue and jurisdiction lie. We hold that Gruendemann’s Montana conviction of sexual intercourse without consent is not barred under § 46-11-503(1)0»), MCA.

We affirm the judgment of the District Court.

JUSTICES NELSON, HUNT, TRIEWEILER and LEAPHART concur.


text:
    STATE OF MONTANA, Plaintiff and Respondent, v. FRANK NICHOLAS WILSON, Defendant and Appellant.
    No. 96-458.
    Submitted on Briefs February 20, 1997.
    Decided April 1, 1997.
    54 St.Rep. 278.
    282 Mont. 134.
    936 P.2d 316.
    See C.J.S. Criminal Law § 1459.

      For Appellant: Jeffrey T. Renz and Aileen B. Miller; Montana Defender Project; Missoula.
    For Respondent: Hon. Joseph P. Mazurek, Attorney General; Pamela P. Collins, Assistant Attorney General; Helena; Mike McGrath, Lewis and Clark County Attorney; Helena.
   JUSTICE TRIEWEILER

delivered the opinion of the Court.

The defendant, Frank N. Wilson, was charged by information, filed in the District Court for the First Judicial District in Lewis and Clark County, with the offense of robbery, a felony, in violation of § 45-5-401, MCA. He pled guilty to the offense charged, and the District Court sentenced him to a fifteen-year term of imprisonment. The District Court also concluded that during the robbery he used a dangerous weapon and, on that basis, sentenced him, pursuant to § 46-18-221, MCA, to an additional four-year term of imprisonment. Wilson appeals. We reverse that part of the District Court’s judgment which was based on § 46-18-221, MCA, and remand to the District Court for entry of judgment consistent with this opinion.

The sole issue on appeal is whether the District Court erred when it concluded that Wilson used a dangerous weapon during the commission of his offense.

FACTUAL BACKGROUND

Frank Wilson was charged by information with the offense of robbery, in violation of § 45-5-401, MCA. The information alleged, in relevant part, as follows:

[T]hat on or about the 2nd day of November, 1995 ... [Wilson] committed the offense of ROBBERY, a felony, in that in the course of taking money from Alli’s Pizza in East Helena, he put store owners and employees in fear of immediate bodily injury .by pointing a gun at Timothy Allinson and tieing him up, in violation of Section 45-5-401, MCA.

On February 29,1996, Wilson pled guilty to the offense with which he was charged. The District Court accepted his guilty plea and ordered a presentence investigation report.

The District Court held a sentencing hearing on March 27, 1996. The State of Montana recommended that Wilson receive a fifteen-year sentence, with ten years suspended, for his robbery conviction. The State also contended that he used a dangerous weapon — a gun — during the robbery, and therefore, that the District Court was required to sentence him, pursuant to § 46-18-221, MCA, to an additional two-year minimum sentence.

Wilson admitted that during the robbery he pointed a gun at the victims. However, he claimed that the gun used during the robbery was not a dangerous weapon, and therefore, that § 46-18-221, MCA, does not apply to this case. In support of his claim, he presented evidence of the following facts: (1) the gun used during the robbery was a broken, unloaded, and inoperable BB gun; (2) the gun used during the robbery was neither a firearm nor a destructive device; (3) Wilson did not use, or even attempt to use, the gun as a bludgeon during the robbery; and (4) the victims were not physically injured during the robbery.

Although the State did not dispute any of the aforementioned facts, it asserted that “the victims in this case very clearly felt... [the gun] was a weapon.” Based on that assertion, it maintained that Wilson did in fact use a dangerous weapon during the robbery, and therefore, that he must be sentenced pursuant to § 46-18-221, MCA.

At the conclusion of the hearing, the District Court sentenced Wilson to a fifteen-year term of imprisonment, with five years suspended, for the robbery conviction. Furthermore, the District Court concluded that he used a dangerous weapon during the robbery and, on that basis, sentenced him, pursuant to § 46-18-221, MCA, to an additional four-year term of imprisonment.

DISCUSSION

Did the District Court err when it concluded that Wilson used a dangerous weapon during the commission of his offense?

When we review a district court’s conclusions of law, the standard of review is whether those conclusions are correct. State v. Williams (1995), 273 Mont. 459, 462, 904 P.2d 1019, 1021; Carbon County v. Union Reserve Coal Co., Inc. (1995), 271 Mont. 459, 469, 898 P.2d 680, 686.

Section 46-18-221, MCA, is entitled “Additional sentence for offenses committed with a dangerous weapon” and provides, in relevant part, as follows:

(1) A person who has been found guilty of any offense and who, while engaged in the commission of the offense, knowingly displayed, brandished, or otherwise used a firearm, destructive device, as defined in 45-8-332(1), or other dangerous weapon shall, in addition to the punishment provided for the commission of such offense, be sentenced to a term of imprisonment in the state prison of not less than 2 years or more than 10 years, except as provided in 46-18-222.

Section 46-18-221(1), MCA.

Initially, Wilson contends that the gun he used during the robbery was neither a “firearm” nor a “destructive device.” The State does not dispute either of those contentions. Therefore, we must decide whether Wilson’s gun was a “dangerous weapon.”

Although the District Court failed to expressly state the rationale for its holding, it apparently agreed with the State and concluded that, because Wilson’s victims believed the gun was a weapon which was capable of causing them injury, Wilson did in fact use a dangerous weapon during the robbery. In essence, the District Court based its conclusion on the subjective beliefs and fears of Wilson’s victims. However, we are bound by the plain language of the statute which bases enhanced punishment on the actual use of a “dangerous weapon,” and says nothing about the beliefs of the victims.

We conclude, therefore, that § 46-18-221, MCA, is not intended to prevent fear of danger. The purpose of § 46-18-221, MCA, is to prevent actual danger, and to deter criminals from using dangerous weapons during the commission of crimes. We conclude that § 46-18-221, MCA, must be analyzed pursuant to an objective test, and that district courts should analyze the weapon itself, not the subjective beliefs and fears of the victim, to determine whether a “dangerous weapon” was used during the commission of an offense.

In this case, the examination of Wilson’s gun revealed that it was not a dangerous weapon. It is undisputed that during the robbery Wilson used a broken, unloaded, and inoperable BB gun. A gun in that condition was incapable of being discharged, and therefore, incapable of causing any actual harm by the manner in which Wilson threatened to use it.

The State contends that Wilson’s gun should be considered a dangerous weapon because it could have been used as a bludgeon or a club. There is no evidence in the record, however, to support the assertion that Wilson actually used, attempted to use, or intended to use the gun in such a fashion. The “could have” test would open a Pandora’s Box of dangerous weapons limited only by the imagination of a particular prosecutor. It would provide no prior notice to offenders that their conduct was subject to enhanced punishment, and therefore, is antithetical to the fundamental principle of criminal law that a person of average intelligence is entitled to notice of the type of conduct that the law proscribes. See City of Chateau v. Joslyn (1984), 208 Mont. 499, 505, 678 P.2d 665, 668.

Based on our analysis of § 46-18-221, MCA, and the facts in this case, we hold that the District Court erred when it concluded that Wilson used a dangerous weapon during the commission of his offense. Accordingly, we reverse that part of the District Court’s judgment which was based on § 46-18-221, MCA, and remand this case to the District Court for entry of judgment consistent with this opinion.

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