author: JUSTICE GRAY

text:
    IN THE MATTER OF THE ESTATE OF NINA J. GARLAND, Deceased, Appellant.
    No. 96-654.
    Submitted on Briefs October 17, 1996.
    Decided November 15, 1996.
    53 St.Rep. 1146.
    279 Mont. 269.
    928 P.2d 928.

      For Appellant: Dennis G. Loveless, Attorney at Law, Helena.
    For Respondent: Carl Hatch; Small, Hatch, Doubek & Pyfer, Helena.
   JUSTICE GRAY

delivered the Opinion of the Court.

Anson Fredenberg, the personal representative of the Estate of Nina J. Garland, deceased (the Estate), appeals from the order of the First Judicial District Court, Lewis and Clark County, distributing the assets of the Estate. We reverse and remand.

The Estate raises the following issues on appeal:

1. Did the District Court err in concluding that the surviving spouse who killed the deceased spouse is entitled to a one-half interest in the proceeds from the sale of the real property which he and the decedent owned as a matter of law?

2. Did the District Court err in failing to settle and distribute all of the Estate’s assets?

Nina J. Garland (Nina) and Larry Garland (Larry) were married in Alaska in 1986. Sometime thereafter, Nina and Larry moved to Montana and purchased a house in Helena, Montana, as joint tenants with the right of survivorship.

Nina died testate on October 22, 1993. Larry subsequently was convicted of deliberate homicide for her death and is presently incarcerated in the Montana State Prison. Two minor daughters survive Nina; one of them, Emily Garland, is also Larry’s daughter.

Nina left a will providing for an equal division of her assets between her two daughters. Nina’s brother, Anson Fredenberg (An-son), was appointed personal representative of her Estate and Nina’s will was admitted to informal probate. Pursuant to a stipulation between the Estate and Larry, the house in Helena which Larry and Nina owned in joint tenancy was sold and the proceeds placed in a special trust account to be distributed by the District Court.

A hearing on the final distribution of the Estate’s assets was held in September of 1995. The Estate and Larry disagreed regarding the proper distribution of the proceeds from the sale of Nina and Larry’s house, a Saab automobile and various items of personal property which Larry contended were his premarital property. In its decision and order, the District Court concluded that the Estate and Larry are each entitled to fifty percent of both the proceeds from the sale of the house and any personal property “which Larry cannot prove to have been obtained by him prior to the marriage and used by him exclusively during the marriage [;] ” the court included the Saab automobile which was titled in Nina’s name in the Estate. The Estate appeals.

1. Did the District Court err in concluding that Larry is entitled to a one-half interest in the proceeds from the sale of the real property which he and Nina owned as a matter of law?

Larry and Nina purchased the real property at issue as joint tenants with the right of survivorship and, as a result, each of them owned equal shares in the property. See § 70-1-307, MCA. Ordinarily, upon the death of one joint tenant, the decedent’s ownership interest ceases and the jointly-held property immediately passes to the surviving joint tenant as a matter of law. Vogele v. Estate of Schock (1987), 229 Mont. 259, 263, 745 P.2d 1138, 1140.

The District Court recognized that, under § 72-2-813(3)(b), MCA, Nina and Larry’s interests in the real property were transformed into tenancies in common upon Nina’s death resulting from Larry’s felonious act. Relying on the Official Comments to § 72-2-813(3)(b), MCA, however, the court interpreted § 72-2-813(3)(b), MCA, as severing only Nina’s interest in the property and allowing that interest to pass under her will, with Larry retaining his equal interest with no right of survivorship. As a result, the District Court concluded that the Estate and Larry each retained a one-half interest in the value of the property as a matter of law.

The Estate argues on appeal that the District Court’s conclusion was erroneous. It contends that both Nina and Larry’s interests were severed and transformed into tenancies in common pursuant to § 72-2-813(3)(b), MCA, and, therefore, that tenancy in common principles apply. The Estate argues that, under those principles, it was entitled to attempt to prove that Nina contributed more to the property than Larry did, with the potential result that the Estate would receive a larger share of the proceeds from the sale of the property. We review a district court’s conclusions of law to determine if the court’s interpretation of the law is correct. Loney v. Milodragovich, Dale & Dye, P.C. (1995), 273 Mont. 506, 510, 905 P.2d 158, 161 (citation omitted).

The resolution of this case turns, initially, on the proper interpretation of § 72-2-813(3)(b), MCA, a statute we have not previously construed. Section 72-2-813(3), MCA, provides, in pertinent part:

The felonious and intentional killing of the decedent:

(b) severs the interests of the decedent and killer in property held by them at the time of the killing as joint tenants with the right of survivorship and transforms the interests of the decedent and killer into tenancies in common.

Our role in interpreting statutes is simply “to ascertain and declare what is in terms or in substance contained therein. ...” Section 1-2-101, MCA. We must pursue legislative intent if possible. See § 1-2-102, MCA. Where the intention of the legislature can be determined from the plain meaning of the words used, our role in interpreting the statute is at an end. Clarke v. Massey (1995), 271 Mont. 412, 416, 897 P.2d 1085, 1088. Where the language is clear and unambiguous, the statute speaks for itself and we will not resort to legislative history or other extrinsic means of interpretation. Clarke, 897 P.2d at 1088.

Section 72-2-813(3)(b), MCA, clearly, unambiguously and in plain language mandates that upon the intentional and felonious killing of one joint tenant by another, the interests of both the decedent and the killer are severed and transformed into tenancies in common. Thus, the killer is divested of the benefits of a joint tenancy — the right to survivorship and ownership of “equal shares” in the property. See § 70-1-307, MCA.

In interpreting § 72-2-813(3)(b), MCA, the District Court relied on the Official Comments to § 72-2-813(3)(b), MCA, in determining that the legislature’s purpose in enacting the statute “was to preclude the co-tenant’s killer from gaining benefit from his criminal conduct.” On that basis, the court concluded that only the decedent’s interest is severed and the killer loses only his right of survivorship. Since the language used in § 72-2-813(3)(b), MCA, is clear, -unambiguous and plain, however, the court’s role in interpreting the statute was at an end and it could not properly resort to legislative history or other extrinsic means of interpretation. See §§ 1-2-101, 1-2-102, MCA; Clarke, 897 P.2d at 1088.

Moreover, in its decision and order, the District Court stated that “the interest of the decedent is severed so that her share passes as her property and her killer has no right of survivorship.” The District Court’s statement appears to incorporate language from § 72-2-104(2), MCA (1991), the predecessor to § 72-2-813(3)(b), MCA, which provided:

Any joint tenant who feloniously and intentionally kills another joint tenant thereby effects a severance of the interest of the decedent so that the share of the decedent passes as his property and the killer has no rights by survivorship. [Emphasis added.]

Section 72-2-104(2), MCA (1991), was renumbered and substantially revised in 1993. See § 72-2-813(3)(b), MCA (1993). Thus, while the 1991 version of the statute provided for severance of only the decedent’s interest, the 1993 version — which remains unchanged — provides for severance of both the decedent’s and the killer’s interests in the property held as joint tenants at the time of the killing. Section 72-2-813(3)(b), MCA.

Furthermore, the effect of the statutory severances under the 1991 and 1993 versions of the statute differ significantly. Section 72-2-104(2), MCA(1991), expressly stated that the decedent’s interest was severed “so that the share of the decedent passes as his property and the killer has no rights by survivorship.” (Emphasis added.) Section 72-2-813(3)(b), MCA, on the other hand, expressly provides that both the decedent’s and the killer’s interests are severed and that the killing “transforms the interests of the decedent and killer into tenancies in common.” (Emphasis added).

Thus, as is evident from a review of the plain language of the statutes, §§ 72-2-104(2), MCA (1991), and 72-2-813(3)(b), MCA, provide for substantially different results based on the same factual situation — the felonious and intentional killing of a joint tenant by another joint tenant. The District Court incorrectly interpreted § 72-2-813(3)(b), MCA, to mandate an effect on the decedent’s and killer’s interests identical to that mandated under the predecessor statute, § 72-2-104(2), MCA (1991).

Larry relies on In re Estate of Matye (1982), 198 Mont. 317, 645 P.2d 955, in support of his argument that he is entitled to one-half of the proceeds from the sale of the real property he and Nina owned as joint tenants. Estate of Matye is not applicable here.

In Estate of Matye, we addressed a situation factually analogous to the present case. There, the wife killed the husband with whom she owned property in joint tenancy. Estate of Matye, 645 P.2d at 956. The district court determined that the wife was entitled to one-half of the proceeds from the joint tenancy property and the husband’s estate appealed. Estate of Matye, 645 P.2d at 956-57.

On appeal, we interpreted § 72-2-104(2), MCA (1981), which remained unamended by the legislature through 1991. We concluded that, according to the plain language of the statute, only the decedent’s interest was severed and that share must be distributed as property of the decedent without any right of survivorship in the killer. Estate of Matye, 645 P.2d at 957. The effect was that the killer retained her one-half interest in the proceeds of the property. See Estate of Matye, 645 P.2d at 957.

As discussed above, however, § 72-2-104(2), MCA (1981), has since been renumbered and substantially revised. See § 72-2-813(3)(b), MCA. Thus, our analysis in Estate of Matye is inapplicable to the present case in which we interpret and apply § 72-2-813(3)(b), MCA.

We conclude that where a joint tenant kills another joint tenant, the plain language of § 72-2-813(3)(b), MCA, effectuates a severance of both the decedent’s and the killer’s interests and transforms those interests into tenancies in common as a matter of law. Therefore, in determining the respective interests of the killer and the estate of the decedent under § 72-2-813(3)(b), MCA, district courts must apply the legal rules applicable to tenancies in common.

Section 70-1-313, MCA, defines tenancy in common as an interest “owned by several persons, not in joint ownership or partnership.” Thus, unlike § 70-1-307, MCA, which defines joint interests, § 70-1-313, MCA, does not expressly provide for ownership in “equal shares.” Nor do tenancies in common under § 70-1-313, MCA, include the right of survivorship under which ownership of the entire interest in the joint tenancy property vests in the surviving joint tenant as a matter of law upon the death of the other joint tenant. See Vogele, 745 P.2d at 1140.

Tenants in common presumptively own undivided equal interests in property; however, that presumption is subject to rebuttal. See Sack v. Tomlin (Nev. 1994), 871 P.2d 298, 304; Lawrence v. Harvey (1980), 186 Mont. 314, 322-24, 607 P.2d 551, 557; Ivins v. Hardy (1947), 120 Mont. 35, 42, 179 P.2d 745, 748 (overruled on other grounds). Therefore, on the death of one co-tenant, the surviving co-tenant and the decedent’s estate may be entitled to unequal shares in the property. The respective shares of the decedent’s estate and the surviving co-tenant depend on the decedent’s and the surviving tenant’s individual contributions to the acquisition and maintenance of the property. See, e.g., Tomlin, 871 P.2d at 305. Absent proof of disparate contributions, however, the presumption that the co-tenants are entitled to undivided equal interests stands.

Here Nina and Larry’s interests were severed and transformed into tenancies in common upon Nina’s death. See § 72-2-813(3)(b), MCA. Presumptively, those interests became undivided equal interests in the property; the presumption, however, can be rebutted. See Lawrence, 607 P.2d at 557. Thus, the Estate and Larry’s respective shares in the proceeds from the sale of the house ultimately will depend on whether the presumption is rebutted via proof regarding Nina and Larry’s disparate individual contributions to the acquisition and maintenance of the property at issue. We hold, therefore, that the District Court erred in concluding that the Estate and Larry are each entitled to fifty percent of the proceeds from the sale of the property Nina and Larry owned as joint tenants as a matter of law.

2. Did the District Court err in failing to settle and distribute all of the Estate’s assets?

The Estate argues on appeal that the District Court erred as a matter of law in failing to order the complete settlement and distribution of the Estate’s assets and the discharge of Anson from further claims. It relies on § 72-3-1001(3), MCA, which provides:

After notice to all interested persons and hearing, the court may enter an order or orders, on appropriate conditions, determining the persons entitled to distribution of the estate and, as circumstances require, approving settlement and directing or approving distribution of the estate and discharging the personal representative from further claim or demand of any interested person. Anson petitioned for determination of testacy and heirs and for

settlement and distribution of the Estate’s assets pursuant to § 72-3-1001(1) and (2), MCA. He also filed a final account which contained a proposed distribution of the Estate’s assets. Larry objected to the Estate’s final account. He argued that he was entitled to one-half of the proceeds from the sale of the real property he and Nina held as joint tenants, that the Saab automobile should be distributed to him and that various items were his personal premarital assets. The Estate filed an amended final account immediately preceding the hearing in which it requested the court to distribute a retirement account not listed in its original final account and authorize repayment of a debt against the Estate.

In its decision and order, the District Court stated that “[a] hearing on the final distribution of the [Estate’s] assets” was held. It subsequently determined that

[a]ny [personal] property which Larry cannot prove to have been obtained by him prior to the marriage and used by him exclusively during the marriage is deemed to have been held jointly by the parties during the marriage, and as tenants in common from the time of Nina’s death.

The court did not address the additional items in the amended final account such as the retirement account. Nor did it settle and distribute the contested personal property which Larry contends is his personal premarital property, leaving the Estate and Larry to continue to dispute the proper disposition of such property. Finally, the District Court did not discharge Anson.

Section 72-3-1001(3), MCA, provides that, in making a final distribution of an estate, a court must discharge the personal representative from further claims by interested persons; however, nothing in § 72-3-1001(3), MCA, mandates that a court settle and distribute an estate at the time requested by the parties. It is unclear in this case whether the District Court intended its decision and order to constitute a final settlement and distribution of the Estate pursuant to § 72-3-1001(3), MCA. What is clear, however, is that the District Court did not meet the statutory requirements for a final distribution by “determining the persons entitled to distribution of the estate and ... approving settlement and directing... distribution of the estate and discharging the personal representative. ...’’See § 72-3-1001(3), MCA. Therefore, this case must be remanded to the District Court for further proceedings toward final distribution of the Estate.

Reversed and remanded.

CHIEF JUSTICE TURNAGE, JUSTICES NELSON, ERDMANN and TRIEWEILER concur.


source: Caselaw Access Project

author: JUSTICE LEAPHART JUSTICE TRIEWEILER

license: Public Domain

text:
    THOMAS ARTHUR (ART) CLARK, Plaintiff, Appellant and Cross-Respondent, v. EAGLE SYSTEMS, INC.; JOHN T. ACKERMAN; RICHARD B. SCHWEITZER; and RANDAL M. SUNDQUIST, Defendants, Respondents and Cross-Appellants.
    No. 96-032.
    Submitted on Briefs July 25, 1996.
    Decided November 20, 1996.
    53 St.Rep. 1150.
    279 Mont. 279.
    927 P.2d 995.

      For Appellant: K. D. Peterson; Peterson & Schofield, Billings.
    For Respondents: Steven J. Lehman; Crowley, Haughey, Hanson, Toole & Dietrich, Billings.
   JUSTICE LEAPHART

delivered the Opinion of the Court.

Thomas Arthur Clark (Clark) appeals from the order of the Thirteenth Judicial District Court, Yellowstone County, granting Eagle Systems’ (Eagle) motion for summary judgment, concluding that the Wrongful Discharge From Employment Act (the Act) applied and that Clark was terminated for good cause, that Clark failed to state a prima facie case under the Age Discrimination in Employment Act, that Clark could not prevail on his tortious interference with contracts claim, and that the Act is the exclusive remedy and precludes Clark’s claim for negligent or intentional infliction of emotional distress. Eagle cross-appeals from the District Court’s conclusion that the Act applies to Clark’s demotion absent a cessation in employment. We affirm.

We address the following issues on appeal:

1. Did the District Court err in concluding that the Wrongful Discharge from Employment Act applies to demotions that do not result in a cessation of employment?

2. Did the District Court err in granting Eagle’s motion for summary judgment on the issue of Clark’s claim under the Age Discrimination in Employment Act?

3. Did the District Court err in granting summary judgment in favor of the individually-named defendants on Clark’s claim of tortious interference and negligent or intentional infliction of emotional distress?

Clark was employed with Eagle as the terminal manager in Billings, Montana. Eagle contracted with Burlington Northern Railroad (BN) to provide ramp, drayage, and mechanical services for BN at the Billings terminal. In addition, Eagle is responsible for loading and unloading trains in a timely manner.

Clark had been employed in the transportation field since 1955 and had served in a variety of positions for previous contractors providing services to the railroad. Clark was hired by Eagle in May of 1985 and continued to serve as terminal manager in Billings until November 21, 1991. On that date, Clark met with Dick Schweitzer (Schweitzer), who was Clark’s supervisor, and Schweitzer notified Clark that he was being replaced the next day as terminal manager and was being demoted to the position of utility person. Eagle maintains that Clark was difficult to work with and verbally abusive to both customers and co-workers. Randal Sundquist (Sundquist), who was Clark’s subordinate and worked as shop and maintenance supervisor, reported his problems with Clark directly to Schweitzer in the months before Clark’s demotion. Several other employees at the Billings terminal stated that they had difficulties with Clark’s “paranoia” and harsh discipline.

In May of 1992, Clark filed a complaint with the Montana Human Rights Commission (HRC) alleging that he had been discriminated against based on his age. Eagle removed the case to federal court and, in November of 1993, Clark amended the complaint alleging a cause of action for tortious interference with contract and joining John Ackerman, BN’s intermodal hub center manager, Sundquist and Schweitzer as individual defendants. Due to the addition of the Montana defendants, the federal court lost diversity jurisdiction and the matter was remanded to state district court in March of 1994.

On March 31, 1994, the HRC issued a right to sue letter. Accordingly, Clark again amended his complaint alleging a cause of action for age discrimination against Eagle. On October 25, 1995, the District Court granted summary judgment to defendants on all issues. Clark appeals from the grant of summary judgment in favor of the defendants and Eagle cross-appeals from the court’s determination that the Act applies absent a cessation in employment.

Standard of Review

Our standard in reviewing a district court’s grant of a motion for summary judgment is de novo. Heiat v. Eastern Montana College (1996), 275 Mont. 322, 327, 912 P.2d 787, 790 (citing Minnie v. City of Roundup (1993), 257 Mont. 429, 431, 849 P.2d 212, 214). That is, we review an order of summary judgment using the same criteria as the district court; we are guided by Rule 56, M.R.Civ.P. Chilberg v. Rose (1995), 273 Mont. 414, 416, 903 P.2d 1377, 1378. Thus, we determine whether a genuine issue of material fact exists and whether the moving party is entitled to judgment as a matter of law. Heiat, 912 P.2d at 791 (citing Minnie, 849 P.2d at 214). Summary judgment is an extreme remedy and should never be substituted for a trial if a material fact controversy exists. Heiat, 912 P.2d at 791 (citing Howard v. Conlin Furniture No. 2, Inc. (1995), 272 Mont. 433, 436, 901 P.2d 116, 118-19).

A party seeking summary judgment has the burden of establishing a complete absence of any genuine factual issue. Howard, 901 P.2d at 118. In light of the pleadings and the evidence before the district court, there must be no material issue of fact remaining which would entitle a non-moving party to recover. Howard, 901 P.2d at 118. Once the moving party has met its burden, the party opposing the summary judgment motion must present material and substantial evidence, rather than conclusory or speculative statements, to raise a genuine issue of material fact. Howard, 901 P.2d at 119. In addition, all reasonable inferences that might be drawn from the offered evidence should be drawn in favor of the party who opposed summary judgment. Howard, 901 P.2d at 119 (citing Cereck v. Albertson’s, Inc. (1981), 195 Mont. 409, 411, 637 P.2d 509, 511).

1. Did the District Court err in concluding that the Wrongful Discharge from Employment Act applies to demotions that do not result in a cessation of employment?

Relying on this Court’s recent opinion in Howard, the District Court stated that "the case at bar involves neither a lateral transfer nor a minor change in job description. Plaintiff was also absolutely and finally terminated from his managerial position despite the offer of another, inferior, position.” The court concluded that “a jury might conclude that plaintiff’s demotion qualified as a discharge within the meaning of the Act.” Having determined that the Act did apply, the court went on to conclude that there was good cause for Clark’s reclassification and granted Eagle’s motion for summary judgment on that basis. In reviewing a district court’s conclusions of law, we determine whether the court’s interpretation of the law is correct. Stratemeyer v. Lincoln County (1996), 276 Mont. 67, 915 P.2d 175, 177 (citing Steer, Inc. v. Department of Revenue (1990), 245 Mont. 470, 474-75, 803 P.2d 601, 603-04).

Application of the Act hinges on the existence of a “discharge” or a “constructive discharge.” Section 39-2-903, MCA, defines the terms “discharge” and “constructive discharge” as follows:

(1) “Constructive discharge” means the voluntary termination of employment by an employee because of a situation created by an act or omission of the employer which an objective, reasonable person would find so intolerable that voluntary termination is the only reasonable alternative. Constructive discharge does not mean voluntary termination because of an employer’s refusal to promote the employee or improve wages, responsibilities, or other terms and conditions of employment.
(2) “Discharge” includes a constructive discharge as defined in subsection (1) and any other termination of employment, including resignation, elimination of the job, layoff for lack of work, failure to recall or rehire, and any other cutback in the number of employees for a legitimate business reason. [Emphasis added.]

As § 39-2-903, MCA, makes clear, “discharge” includes “constructive discharge” and “any other termination of employment.”

In Howard, the plaintiff was terminated from his position as store manager and subsequently offered a position as a sales person at a salary of 75 percent less than his previous salary; Howard did not accept the inferior position. Howard, 901 P.2d at 118. In the instant case, however, Clark was replaced as the terminal manager and immediately reassigned and reclassified as a utility person. Unlike Howard, the record does not reflect whether there was a substantial change in salary or benefits. Clark reported for work the following morning as a utility person and there was no cessation of employment.

In the instant case, Clark does not allege that he was constructively discharged. Furthermore, there has not been a termination of employment within the meaning of the Act. While the District Court correctly stated the rule we recently announced in Howard — that an absolute and final termination from a managerial position followed by the offer of an inferior position may be a termination of employment for purposes of the Act — that rule is inapplicable in the instant case. Here, Clark was never terminated from his employment with Eagle nor did he resign. In fact, he reported to work the following morning and worked as a utility person until several months later when he became disabled and was no longer able to perform his duties.

Section 39-2-904, MCA, requires that there must be a termination of employment before the Act applies. In determining when the statute of limitations begins to run under the Act, this Court stated that termination of employment has been defined to mean “ ‘a complete severance of the relationship of employer and employee by positive act on the part of either or both.’ ” Allison v. Jumping Horse Ranch (1992), 255 Mont. 410, 412-13, 843 P.2d 753, 755 (quoting Edwards v. Equitable Life Assurance Soc. (Ky. 1944), 177 S.W.2d 574, 577). Further, in Allison, we recognized that “[u]nder [the Act], damages do not occur until the employee is no longer earning compensation from the employer, which under the Act is lost wages and fringe benefits, and this can only occur upon a complete severance of the employer-employee relationship.” Allison, 843 P.2d at 756.

In the instant case, there has been no termination — no “complete severance” of the employment relationship. Unlike Howard, there has been no cessation of employment followed by an offer of an inferior position. Under § 39-2-904, MCA, the Act is inapplicable because there was no termination of Clark’s employment relationship. Accordingly, we hold that the District Court was incorrect in concluding that Clark’s demotion qualified as a discharge under the meaning of the Act.

Although the District Court granted summary judgment for the wrong reasons, it reached the correct result. We affirm district court decisions which are correct regardless of the court’s reasoning in reaching the decision. Phillips v. City of Billings (1988), 233 Mont. 249, 252, 758 P.2d 772, 774. Thus, for the reasons set forth above, we affirm the summary judgment for Eagle on Clark’s claim for damages under the Wrongful Discharge from Employment Act.

2. Did the District Court err in granting Eagle’s motion for summary judgment on the issue of Clark’s claim under the Age Discrimination in Employment Act?

In Heiat, 912 P.2d at 793, we announced the standard for analyzing summary judgment motions in the employment discrimination context stating that

[t]he plaintiff must allege a prima facie case of discrimination in her complaint. In this context, the plaintiff alleges a prima facie case by asserting that plaintiff is a member of a protected class, and that a male colleague with the same credentials, who performs substantially the same work, receives a higher salary. The employer seeking summary judgment must then come forward with a legitimate nondiscriminatory reason for the disparity. If the employer comes forward with a legitimate nondiscriminatory reason, the plaintiff must then, in addition to having alleged a prima facie case in the complaint, produce evidence that establishes her prima facie case as well as evidence which raises an inference that the employer’s proffered reason is pretextual.

Here, Clark alleged a prima facie case of age discrimination: (1) that he is in a protected age group; (2) that he performed his job in a satisfactory manner; (3) that he was discharged; and (4) that he was replaced by a substantially younger worker. See Tonack v. Montana Bank of Billings (1993), 258 Mont. 247, 854 P.2d 326. Eagle filed a motion for summary judgment on the basis that the record was devoid of any facts showing age to be a factor in Clark’s reclassification. Eagle satisfied its burden in moving for summary judgment by presenting a legitimate nondiscriminatory reason for Clark’s demotion; that is, he had failed to satisfactorily perform his job duties.

Under Heiat, the burden was on Clark to respond to Eagle’s motion for summary judgment by, in addition to having alleged a prima facie case, producing evidence supporting his prima facie case as well as producing evidence raising an inference that the employer’s proffered reason was pretextual. Clark failed to meet this burden. He was unable to produce evidence supporting his prima facie case or evidence raising an inference that Eagle’s proffered reason (failure to satisfactorily perform) was pretextual.

Although Clark is in a protected age group, he fails to satisfy the additional elements of the prima facie case. As to the second element, there are affidavits and depositions from Clark’s supervisors and Eagle employees that he was notperforminghis job satisfactorily. As to the third element, we have previously determined that Clark was not discharged. Finally, Clark was initially replaced by a 51-year-old man, not a substantially younger worker. Although Clark asserts that his prior management position was eventually filled by a substantially younger worker, he makes no more than conclusory statements to support his allegation that Sundquist’s eventual promotion to terminal manager was in any way related to Clark’s age. Clark has not presented material and substantial evidence, rather, he has made conclusory or speculative statements. These conclusory and speculative statements do not create a genuine issue of material fact which would preclude the grant of summary judgment. Howard, 901 P.2d at 119.

3. Did the District Court err in granting summary judgment in favor of the individually-named defendants on Clark’s claim of tortious interference and negligent or intentional infliction of emotional distress?

In light of our holding that the Act does not apply to a demotion as opposed to a termination, the District Court erred in ruling that Clark’s claims for tortious interference and emotional distress were preempted by the Act. Nonetheless, since we have affirmed the District Court’s grant of summary judgment on the age discrimination claim, based on Eagle’s unrebutted showing that Clark’s demotion was attributable to unsatisfactory job performance, logic and consistency dictate that we affirm the summary judgment as to Clark’s remaining claims. It would be inconsistent for Clark to attribute blame for his demotion to the individually-named defendants . Accordingly, in keeping with the ruling holding that Clark was responsible for his own demotion, Clark has no claim against the individually-named defendants for infliction of emotional distress or tortious interference with contract. As we stated earlier in the context of the first issue, we affirm district court decisions which are correct regardless of the district court’s reasoning in reaching its decision. Phillips, 758 P.2d at 774. Although the District Court granted summary judgment on tortious interference and emotional distress for the wrong reasons, the result was correct and is, therefore, affirmed.

Affirmed.

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

JUSTICE TRIEWEILER

dissenting.

I concur with the majority’s conclusion that the plaintiff did not present substantial evidence that he was discharged from his position as terminal manager because of his age, and that, therefore, the District Court correctly dismissed his claim of age discrimination by summary judgment.

I dissent from the majority’s conclusion that Thomas Clark was not terminated from employment, and therefore, had no claim pursuant to Montana’s Wrongful Discharge From Employment Act (WDEA) found at §§ 39-2-901 to -915, MCA. Clark was permanently terminated from his position as terminal manager at his employer’s Billings facility. He was then offered a totally different job that he had never performed before as a utility person at substantially reduced pay. (When the majority states that “the record does not reflect whether there was a substantial change in salary,” they ignore Clark’s affidavit.) The mere fact that he took the inferior position simply means that he did everything he could to mitigate his damages. It does not change the fact that he was irreversibly terminated from his employment as the defendant’s terminal manager.

This case is indistinguishable in any practical respect from Howard v. Conlin Furniture No. 2, Inc. (1995), 272 Mont. 433, 901 P.2d 116. Therefore, I conclude that the application of the WDEA is mandated by that decision, the District Court correctly concluded that it was applicable, and the majority has erred by trying to distinguish this case based on irrelevant factors which make no practical difference.

In Howard, the plaintiff was hired as the defendant’s store manager in 1990 at an annual salary of $50,000 plus a commission, and was terminated from that position in 1993. Howard, 272 Mont. at 435-36, 901 P.2d at 118. At the time of his termination from his managerial position, the plaintiff, like Clark, was offered an inferior position in the same store. He was offered a sales position at a salary of $1000 per month plus a commission opportunity. Howard, 272 Mont. at 435-36, 901 P.2d at 118. The District Court dismissed the plaintiff’s complaint in Howard and we reversed.

On appeal, the employer in Howard argued, as the employer in this case argues, that the District Court should be affirmed because the plaintiff had not been discharged from employment, but only demoted. Howard, 272 Mont. at 437, 901 P.2d at 119. We set forth the issue on appeal as follows: “The first sub-issue we must decide is whether Howard was discharged, or merely demoted, following which he resigned.” Howard, 272 Mont. at 438, 901 P.2d at 119.

We held that the following facts were significant to our conclusion that the plaintiff had in fact been discharged from his position as store manager:

This case does not involve a lateral transfer, nor a minor change in job description. This case involves absolute and final termination from a managerial position, followed by an offer of employment in a functionally different, and substantially inferior, position with the same employer. To hold, as Conlin suggests, that termination of employment in a position that pays over $50,000 per year, and subsequently offering a position which pays less than 25 percent of that amount, is not “a termination of employment” would ignore the plain language of the Act and allow circumvention of the Act’s damage provisions which are based on wages at the time of termination. Section 39-2-905, MCA.
Howard was informed that he was being terminated as Conlin’s manager. He was then offered a subordinate position among the sales staff he previously managed. His refusal to accept an offer of a lesser position, at best, affects his duty to mitigate his damages. We conclude that when Howard was terminated from his managerial position, he was discharged from employment within the meaning of § 39-2-903(2), MCA, of Montana’s Wrongful Discharge From Employment Act.

Howard, 272 Mont. at 438, 901 P.2d at 119-20.

There are only two distinctions among the facts in the Howard case and those in this case: (1) Clark accepted the inferior position, whereas Howard rejected it; and (2) we knew what the difference in pay was for Howard, while all we know from Clark’s affidavit is that his pay was substantially reduced following his termination as terminal manager. However, as we noted in Howard, the fact that the employee did or did not take the inferior position simply relates to the issue of mitigation of damages, and whether we know the actual dollar amount by which pay has been reduced, or simply know that pay has been substantially reduced, is a distinction that makes no practical difference.

The majority cites Allison v. Jumping Horse Ranch, Inc. (1992), 255 Mont. 410, 412-13, 843 P.2d 753, 755, for the proposition that a discharge requires “a complete severance of the relationship of employer and employee by positive act on the part of either or both.” However, Allison is inapplicable to the facts in this case. It dealt only with the issue of when the statute of limitations began to run, based on the facts in that case. That case did not involve the termination by the employer of one form of employment and a subsequent offer of substantially inferior employment. Therefore, the majority’s reliance on Allison is misplaced. Howard, on the other hand, is directly on point and factually indistinguishable.

The inference from the majority’s decision is that, had Clark turned down the inferior position of utility person, he could have made a claim for constructive discharge pursuant to the WDEA and our decision in Howard. However, that suggestion also ignores that plain language of our decision in Howard. That decision was not based on our conclusion that by offering the plaintiff an inferior position he was constructively discharged. It was based on our conclusion that when he was finally terminated as store manager, he was “discharged from employment within the meaning of § 39-2-903(2), MCA, of Montana’s Wrongful Discharge From Employment Act.” Howard, 272 Mont. at 438, 901 P.2d at 120.

For these reasons, I conclude that Clark has stated a claim for wrongful discharge pursuant to Montana’s Wrongful Discharge From Employment Act, and that the District Court erred when it dismissed that claim by summary judgment. I therefore dissent from that part of the majority opinion which affirms the District Court’s dismissal.

Because I conclude that Clark’s termination from employment was covered by the Wrongful Discharge From Employment Act, I specially concur with that part of the majority opinion which affirms the District Court’s dismissal of Clark’s claims for tortious interference and negligent or intentional infliction of emotional distress. For those employees covered by the Wrongful Discharge From Employment Act, common law remedies are preempted pursuant to § 39-2-913, MCA, and pursuant to § 39-2-905(3), MCA, there is no right to recover damages for emotional distress.

JUSTICE HUNT joins in the foregoing dissenting opinion.


author: CHIEF JUSTICE TURNAGE

text:
    BETH SORENSEN and MARK SORENSEN, Plaintiffs and Appellants, v. FARMERS INSURANCE EXCHANGE, Defendant and Respondent.
    No. 96-130.
    Heard and Submitted September 12, 1996.
    Decided November 20, 1996.
    53 St.Rep. 1155.
    279 Mont. 291.
    927 P.2d 1002.

      For Appellant: Daniel W. Hileman (argued), Murray & Kaufman, Kalispell.
    For Respondent: Shelton C. Williams (argued) and Susan Moriarity Miltko, Williams & Ranney, P.C., Missoula.
    For Amicus Curiae: Peter L. Helland, Edmiston Law Firm, Billings (for Montana Trial Lawyers Association).
   CHIEF JUSTICE TURNAGE

delivered the Opinion of the Court.

Beth Sorensen was injured in a two-vehicle accident. The Eleventh Judicial District Court, Flathead County, ruled that because she and her husband Mark settled with the liability carrier for the driver of the other vehicle, they were precluded from seeking, in this action, underinsured motorist coverage from their own insurance carrier. We reverse and remand for further proceedings consistent with this Opinion.

We here determine that the District Court erred in ruling that the Sorensens may not recover an underinsured motorist claim after releasing the tortfeasor without their insurer’s permission.

On November 21, 1991, Beth Sorensen’s vehicle was struck by a vehicle driven by Cynthia Lynn Ryan. Sorensen alleges permanent disability as a result of injuries sustained in the collision. As a result of her injuries, Sorensen has claimed medical expenses of at least $52,974.06. Additionally, a vocational rehabilitation counselor has estimated her loss of earnings at $803,495.46.

Ryan held liability insurance with State Farm Mutual Automobile Insurance Company with a limit of $50,000. After investigating Ryan’s assets or, more precisely, the lack thereof, Sorensen’s attorney advised her to accept Ryan’s $50,000 policy limit from State Farm. Beth and Mark Sorensen executed a written release of Cynthia Ryan, her ex-husband Patrick H. Ryan, and State Farm from any further liability.

The Sorensens then brought this action against their own insurer, Farmers Insurance Exchange, seeking to recover underinsured motorist coverage under their own motor vehicle insurance. In answering the complaint, Farmers alleged that because the Sorensens had settled with Ryan’s liability carrier, State Farm, and executed a release, they were precluded from seeking underinsured motorist coverage from Farmers.

Farmers moved for summary judgment, which motion was granted. The District Court reasoned that when an insured has destroyed her insurer’s right of subrogation, the insured is barred from a claim against the insurer. The court relied on this Court’s opinion in Nimmick v. State Farm Mut. Auto. Ins. Co. (1995), 270 Mont. 315, 891 P.2d 1154. The Sorensens appeal.

Did the District Court err in ruling that the Sorensens may not recover an underinsured motorist claim after releasing the tortfeasor without their insurer’s permission?

Our standard of review on summary judgment is the same as that used by the district court — whether material issues of fact exist and whether the moving party is entitled to judgment as a matter of law. McCracken v. City of Chinook (1990), 242 Mont. 21, 24, 788 P.2d 892, 894; Rule 56(c), M.R.Civ.P. In this case, the material facts are undisputed. We therefore limit our review to the correctness of the trial court’s legal conclusion.

The Sorensens’ Farmers insurance policies provided that:

In the event of any payment under this policy, we are entitled to all the rights of recovery of the person to whom payment was made against another. That person must sign and deliver to us any legal papers relating to that recovery, do whatever else is necessary to help us exercise those rights and do nothing after loss to prejudice our rights.

Farmers argues, and the District Court ruled, that Farmers is not liable to pay the Sorensens under the underinsured motorist clause because they failed to notify Farmers before they released State Farm and the Ryans from further liability. Farmers maintains that by destroying its subrogation rights, the Sorensens breached the insurance contract.

In making its argument, Farmers relies on this Court’s opinion in Nimmick. Nimmick was injured as a passenger in a one-vehicle accident. She brought suit against her insurer, State Farm, to recover damages under the uninsured motorist provision of her insurance policy. She subsequently entered a settlement agreement with Employers Mutual, the insurer for the owner of the vehicle in which she was injured. In her suit against State Farm, Nimmick alleged that because the unauthorized driver of the vehicle was not covered under the Employers Mutual policy, she was entitled to uninsured motorist coverage under her own insurance.

After examining the language of the settlement agreement signed by Nimmick and Employers Mutual and its underlying effect as a whole, this Court concluded that the settlement was made on behalf of the driver of the vehicle, as well as the owner and other passengers, as the agreement expressly stated. Therefore, we concluded, the driver was no longer an uninsured motorist under the State Farm policy. Nimmick, 891 P.2d at 1159.

The issue in Nimmick concerned uninsured motorist coverage, whereas the present case involves underinsured motorist coverage. Farmers maintains that this distinction is insignificant and that Montana courts generally treat uninsured and underinsured motorist coverage similarly, citing Bennett v. State Farm Mut. Auto. Ins. Co. (1993), 261 Mont. 386, 862 P.2d 1146.

Farmers focuses on the subrogation analysis in Nimmick. It argues that but for the destruction of the insurer’s subrogation rights, the tortfeasor in Nimmick would still have been uninsured, and coverage would apply. Farmers reasons that here, because Sorensen has destroyed its subrogation rights, coverage does not apply.

The dispositive issue in Nimmick was whether an uninsured motorist was still involved after the settlement. A settlement between an underinsured motorist like Ryan and an injured person like Sorensen does not necessarily eliminate the underinsured status, as did the insurance settlement for the motorist’s uninsured status in Nimmick. Here, Ryan’s underinsured status would be eliminated only if the insurance settlement covered all damages. Such is not the case on the record here. We conclude that the distinction between uninsured motorist coverage and underinsured motorist coverage is significant for purposes of the issue here presented.

Even where a right to subrogation exists, many courts have recognized that if the insurer is unable to demonstrate prejudice to itself as a result of an unapproved settlement, the insured is not barred from collecting on the insurance policy. See, e.g., Thompson v. American States Ins. Co. (M.D. Ala. 1988), 687 F.Supp. 559; Rafferty v. Progressive American Ins. Co. (Fla. Dist. Ct. App. 1990), 558 So.2d 432; Mulholland v. State Farm Mut. Auto. Ins. Co. (Ill. App. Ct. 1988), 527 N.E.2d 29; Kapadia v. Preferred Risk Mut. Ins. Co. (Iowa 1988), 418 N.W.2d 848; Lumbermens Mut. Cas. Co. v. Mercurio (Mass. App. Ct. 1989), 535 N.E.2d 234; Tegtmeyer v. Snellen (Mo. Ct. App. 1990), 791 S.W.2d 737; Branch v. Travelers Indem. Co. (N.C. Ct. App. 1988), 367 S.E.2d 369, aff’d 378 S.E.2d 748 (1989); Federated Service Ins. Co. v. Granados (Or. 1995), 889 P.2d 1312; Prudential Property & Cas. Ins. Co. v. Nayerahamadi (E.D. Pa. 1984), 593 F.Supp. 216; Thiringer v. American Motors Ins. Co. (Wash. 1978), 588 P.2d 191.

In his concurrence to Nimmick, Justice Leaphart urged that Montana adopt such a “no prejudice” rule. He explained that under a “no prejudice” rule, a settlement with a tortfeasor would not release an insurer if the plaintiff could show that the tortfeasor was judgment proof and thus there was no prejudice to the insurer.

As applied to a case involving underinsured motorist coverage, a “no prejudice” rule states that absent some showing of material prejudice to the underinsurance carrier, a claim for underinsured motorist coverage may not be precluded on a technicality. The “no prejudice” rule has been explained as follows:

The loss of an insurer’s subrogation right may not be significant. In many instances, pursuit of any recovery from an insured tortfeasor beyond the available liability insurance would be fruitless. ... “[A] technical and illusory ‘loss’ of this kind cannot result in the forfeiture of insurance coverage.” Such decisions establish, either implicitly or explicitly, a requirement that an insurer must be prejudiced as a result of a settlement with a tortfeasor or tortfeasor’s insurer that is entered into without the consent of the insurer providing underinsured motorist insurance. ...
There is now a significant body of judicial precedents for the proposition that in order to justify foreclosing an insured’s right to indemnification from an otherwise applicable underinsured motorist insurance coverage, an insurer must show that it was prejudiced by the settlement of the tort claim.

3 Alan I. Widiss, Insured and Underinsured Motorist Insurance § 43.5, at 347 (1995), quoting Southeastern Fidelity Insurance Company v. Earnest (Fla. Dist. Ct. App. 1981), 395 So.2d 230, 231.

We favor this approach as a matter of public policy. The purpose of underinsured motorist insurance is to provide a source of indemnification for accident victims when the tortfeasor does not provide adequate indemnification. State Farm v. Estate of Braun (1990), 243 Mont. 125, 130, 793 P.2d 253, 256. Denying accident victims indemnification based upon their action which can have no effect on the insurer’s ability to subrogate will not further the purpose of underinsured motorist coverage.

As to the burden of proof:

Most of the judicial decisions in which courts have sustained the view that a failure to secure an insurer’s consent to a settlement only justifies a loss of underinsured motorist insurance benefits when the insurer was prejudiced, seem to require the insurer to show that the unauthorized settlement adversely affected its interests. There are several rationales for this approach. First, the insurer is in the best position both to assess whether it has been prejudiced and to then produce evidence for the court that is relevant to an adjudication. Second, in effect, it recognizes the difficulty of requiring a claimant to attempt to prove the “negative fact” that the insurer was not prejudiced. Finally, if no clear proof is available, such an allocation serves to avoid a forfeiture of coverage.

Widiss, § 43.5 at 349. The “no prejudice” rule places the burden on the insurer which has collected premiums, rather than on an injured claimant, to show that the insurer’s subrogation claim has potential value.

We hold that henceforth in Montana, to justify foreclosing an insured’s right to indemnification from an otherwise applicable underinsured motorist insurance coverage, an insurer must establish that it was prejudiced by settlement of the claim by the insured.

In the present case, the issue of the potential value of Farmers’ subrogation claim was briefed and argued in relation to the summary judgment motion. The Sorensens submitted an affidavit by a private investigator who had conducted a social security search on Cynthia Ryan. The investigator stated that the search indicated that she had lived in six different locations and that her current address was unknown. Beth Sorensen filed an affidavit in which she stated that her attorney had advised her that Ryan was essentially unemployed, had no assets, and was “judgment proof.” Farmers refers in its brief to deposition testimony by the Sorensens that Cynthia Ryan’s ex-husband had a job, a car, and a trailer house. Whatever value that testimony may have in establishing that Cynthia Ryan had assets, the depositions to which Farmers refers are not in the record. We hold that Farmers failed to meet its burden of proving that it was prejudiced by the settlement entered by the Sorensens.

We therefore reverse the decision of the District Court and remand for further proceedings consistent with this Opinion.

JUSTICES NELSON, HUNT, GRAY, TRIEWEILER, LEAPHART and ERDMANN concur.


author: JUSTICE ERDMANN

text:
    STEVEN K. BURGLUND, Petitioner and Appellant, v. LIBERTY MUTUAL FIRE INSURANCE COMPANY, Insurer, Respondent, and Cross-Appellant, for UNITED PARCEL SERVICE, Employer.
    No. 95-252.
    Submitted on Briefs August 15, 1996.
    Decided November 21, 1996.
    53 St.Rep. 1158.
    279 Mont. 298.
    927 P.2d 1006.

      For Appellant: Darrell S. Worm, Ogle & Worm, Kalispell.
    For Respondent: Larry W. Jones, Senior Attorney, Liberty Mutual Fire Insurance Co., Missoula.
   JUSTICE ERDMANN

delivered the Opinion of the Court.

Steven K. Burglund appeals from the amended findings of fact, conclusions of law, and judgment entered by the Workers’ Compensation Court on April 10, 1995, and from the order denying his petition for a new trial filed on May 1, 1995. Liberty Mutual Northwest Insurance Company and United Parcel Service (UPS) filed a cross-appeal of the court’s amended findings of fact, conclusions of law, and judgment. The cross-appeal is limited to the twenty percent disability award granted by the Workers’ Compensation Court as an indemnity benefits award. We affirm the court on both issues raised on appeal.

The issues on appeal are as follows:

1. Did the Workers’ Compensation Court err in denying permanent partial disability (PPD) benefits to Burglund pursuant to § 39-71-703, MCA (1983), for his 1984 industrial injury?

2. Did the Workers’ Compensation Court err in determining that Liberty is liable under §§ 39-71-705 through -708, MCA (1983), for payment to Burglund of 100 weeks of PPD benefits, representing a twenty percent disability?

FACTS

Burglund was bom on April 22, 1955, and is presently forty-one years old. He graduated from high school and attended an electronics institute in the early 1970s. He then installed security equipment for a year or two and worked as a parts clerk at several auto supply stores. Burglund has been employed by UPS as a package car driver since 1980. His employment duties consist of picking up and delivering UPS packages, and sorting and loading packages at the Kalispell UPS Center. Burglund’s “sort-and-load” duties involve the lifting of packages off a conveyer belt and transferring them several feet to the delivery trucks. The packages weigh up to seventy pounds; however, the average package weighs only fifteen to twenty-five pounds.

On February 14, 1984, Burglund suffered an industrial injury arising out of and in the course of his employment with UPS when he fell off a platform and injured his back. He returned to work as a full-time package car driver on March 12,1984. He continued to suffer back pain and was examined by Dr. Henry Gary, a neurosurgeon, on February 16, 1988. Dr. Gary diagnosed Burglund as having a herniated disc at the L5-S1 level.

Between February 1988 and February 1991 his back and leg pain increased. On February 18, 1991, Dr. Gary performed a lumbar laminotomy and foramenotomy at the L5-S1 vertebral level. Burglund was off work until June 1, 1991, at which time he returned to work as a full-time package car driver. Both of his doctors released him to return to work without any restrictions.

On July 16,1992, Dr. Gary wrote a letter in response to an inquiry from Burglund’s attorney regarding his impairment and medical restrictions. He stated that Burglund would have a ten percent permanent partial impairment rating and needed to have some restrictions in any type of work as to the amount of lifting he could do. The letter said that reasonable limits would include not lifting anything over twenty to twenty-five pounds with any frequency and not lifting anything over fifty pounds on an infrequent basis. In the fall of 1992, Burglund was laid off on account of this letter, as the fifty pound limit was less than the seventy pounds he was required to lift for his position with UPS. Liberty attempted to pay PPD benefits, but Burglund refused them on the basis that he had at all times been physically able to perform his job duties.

On November 24,1992, Burglund underwent a physical capacities evaluation to further define his physical restrictions. During this evaluation he reported feeling no pain and demonstrated no pain behaviors. The examiner therefore concluded that Burglund was physically able to work as a UPS package car driver. Dr. Gary reviewed this evaluation and concluded that Burglund would be able to perform his job without any restrictions. As a result, Burglund was allowed to return to work on January 5, 1993, as a UPS package car driver.

In 1993, Burglund filed a claim seeking PPD benefits pursuant to § 39-71-703, MCA (1983), and §§ 39-71-705 through -708, MCA (1983). After trial the court issued its findings of fact, conclusions of law, and judgment on January 19,1995. On February 9,1995, Liberty filed a petition for amendment to the court’s findings and conclusions or alternatively for a new trial. The court withdrew its findings of fact, conclusions of law, and judgment on March 1, 1995. Thereafter, the parties filed a stipulation clarifying the scope of issues to be submitted to the court for decision. On April 10, 1995, the Workers’ Compensation Court filed amended findings of fact, conclusions of law, and judgment and awarded Burglund PPD benefits for a period of 100 weeks at the weekly rate of $138.50, less the ten percent impairment award already paid by Liberty. Burglund filed a petition for a new trial and for an amendment to the findings and conclusions, which the court denied. He appeals from the order denying his petition and from the amended findings of fact and conclusions of law and judgment. Liberty and UPS have filed a cross-appeal alleging that there is not substantial credible evidence in the record to support the Workers’ Compensation Court’s decision that Liberty is liable under §§ 39-71-705 through -708, MCA (1983), for payment to Burglund of 100 weeks of PPD benefits.

ISSUE 1

Did the Workers’ Compensation Court err in denying PPD benefits to Burglund pursuant to § 39-71-703, MCA (1983), for his 1984 industrial injury?

This Court will uphold the Workers’ Compensation Court’s findings of fact if they are supported by substantial credible evidence. Wunderlich v. Lumbermens Mut. Cas. Co. (1995), 270 Mont. 404, 408, 892 P.2d 563, 566. We review the trial court’s conclusions of law to determine if they are correct. Turjan v. Valley View Estates (1995), 272 Mont. 386, 390, 901 P.2d 76, 79.

The parties entered into a stipulation which authorized the Workers’ Compensation Court to determine Burglund’s entitlement to PPD benefits on both a loss of earning capacity basis under § 39-71-703, MCA (1983), and on an indemnity basis under § § 39-71-705 through-708, MCA (1983). A disability award under § 39-71-703, MCA (1983), is based on the actual loss of earning capacity resulting from the injury, whereas an indemnity benefit under §§ 39-71-705 through -708, MCA (1983), awards compensation for possible loss of earning capacity in the future. Stuker v. Stuker Ranch (1991), 251 Mont. 96, 98, 822 P.2d 105, 107.

Burglund argues that the Workers’ Compensation Court erroneously interpreted the law in finding that he suffered no loss of earning capacity and concluding, therefore, that he was not entitled to benefits under § 39-71-703, MCA (1983). He argues that the Workers’ Compensation Court failed to determine whether his ability to earn in the open labor market had been diminished by his work-related injury after taking into account all relevant factors.

Section 39-71-703, MCA (1983), provides that weekly compensation benefits in the amount of 66-2/3 percent of the actual diminution in the worker’s earning capacity shall be paid for an injury producing permanent partial disability. Permanent partial disability is defined by § 39-71-116(12), MCA (1983), as “a condition resulting from injury as defined in this chapter that results in the actual loss of earnings or earning capability.” We have previously held that the relevant inquiry under § 39-71-703, MCA (1983), is whether a claimant’s ability to earn in the open labor market has been diminished by a work-related injury after taking into account all relevant factors. Sedlack v. Bigfork Convalescent Center (1988), 230 Mont. 273, 749 P.2d 1085. These factors include the injured worker’s age, occupation, skills and education, previous health, number of productive years remaining, and degree of physical or mental impairment. Reeverts v. Sears (1994), 266 Mont. 509, 514, 881 P.2d 620, 623. Under § 39-71-703, MCA (1983), a claimant does not have to prove that his job is in jeopardy or that there is a likelihood of losing present employment because of an injury to be eligible for permanent partial disability benefits. Taylor v. Columbia Falls Aluminum Co. (1990), 243 Mont. 464, 795 P.2d 433.

The Workers’ Compensation Court’s conclusion that Burglund was not entitled to benefits under § 39-71-703, MCA (1983), was based on its resolution of factual disputes concerning whether he had physical restrictions from his 1984 injury which would diminish his earning capacity on the open labor market. In order to address Burglund’s assertion, we must first address the findings upon which the court based its conclusion that he was not entitled to benefits under § 39-71-703, MCA (1983).

At trial, Burglund claimed significant and prolonged physical restrictions. The Workers’ Compensation Court did not find his testimony credible and it determined that Burglund did not have the physical restrictions he claimed. The evidence and testimony presented at trial showed that Burglund returned to work without a physician-imposed restriction resulting from his work-related injury. Burglund completed a medical history form and stated that he did not have any disease, illness, or defect which might result in a disability or incapacity. In addition, Burglund’s numerous recreational activities, including nordic ski patrol, white water rafting, sailboat racing, and hunting, indicate that he remains in excellent physical condition. This Court will not substitute its judgment for that of the trial court when the issue relates to the credibility of the witnesses or the weight given to certain evidence. Wunderlich, 892 P.2d at 566. The court’s finding that Burglund did not have the physical restrictions he claimed is supported by substantial credible evidence in the record.

Burglund asserts that the Workers’ Compensation Court erred by analyzing his claim in the context of a “pre-injury normal labor market” and not in the context of an open labor market as set forth in Sedlack, 749 P.2d at 1088. However, given the fact that the Workers’ Compensation Court specifically found that Burglund did not suffer from the physical restrictions he claimed, a review of Burglund’s contention would be superfluous.

The court evaluated the relevant factors in its determination of Burglund’s loss of earning capacity. It considered Burglund’s education and stated that although his electronics certification is obsolete, his previous education demonstrates his intelligence to master technical subjects and that the type of work he has chosen does not require the level of education he has achieved. As to Burglund’s work history, the court noted that performance in his position at the time of his injury has not been diminished by his injury. The court stated that Burglund’s pain and disability does not significantly interfere with his employment. Burglund’s age was considered by the court to be a neutral factor. The Workers’ Compensation Court therefore concluded Burglund suffered no actual wage loss from his injury and is physically able to continue performing his job until he reaches retirement age. We determine that the Workers’ Compensation Court correctly interpreted the law when it determined that Burglund suffered no loss of earning capacity under § 39-71-703, MCA (1983), and that it properly denied PPD benefits to Burglund under this section.

Burglund also appeals the denial of his motion for a new trial. The decision to grant a new trial is within the sound discretion of the trial judge and will not be overturned absent a showing of manifest abuse of discretion. Fjelstad v. State Dep’t of Highways (1994), 267 Mont. 211, 220, 883 P.2d 106, 111; Stanhope v. Lawrence (1990), 241 Mont. 468, 471, 787 P.2d 1226, 1228.

The Workers’ Compensation Court found Burglund’s testimony at trial that he was physically restricted in his job performance unbelievable. Burglund argues that newly discovered evidence of his current physical condition raises a reasonable probability of a different result, especially concerning the findings involving his credibility. He claims that the 1984 injury forced him to stop working at UPS seventeen months after the trial and that his credibility at trial as to his physical restrictions should be reevaluated. Burglund asserts that refusing to reopen the record to admit evidence on what the lower court viewed as a central issue of this case, whether he could continue working indefinitely in his current position, was a manifest abuse of discretion that compels reversal of the lower court’s decision.

The Workers’ Compensation Court stated that it cannot go back and retry a matter simply because there have been subsequent developments. The court held, however, that it does have jurisdiction to consider subsequent changes in his disability under § 39-71-2909, MCA, and that Burglund’s remedy is to file a new petition. We conclude that the Workers’ Compensation Court did not abuse its discretion in so holding.

ISSUE 2

Did the Workers’ Compensation Court err in determining that Liberty is liable under §§ 39-71-705 through -708, MCA (1983), for payment to Burglund of 100 weeks of PPD benefits, representing a twenty percent disability?

Permanent partial disability benefits available under §§ 39-71-705 through -708, MCA (1983), are commonly referred to as “indemnity benefits.” Liberty and UPS assert that the triggering event for an award of indemnity benefits is a physical restriction arising from an injury that has or may adversely affect a person’s ability to work in the future. They argue that because Burglund has no physical restrictions on his work or recreational activities that as a matter of law he is not entitled to indemnity benefits.

Indemnity benefits are based upon the schedule of injuries set forth in § 39-71-705, MCA (1983). In the case of a non-scheduled injury, such as the back injury found in this case, the maximum number of weeks of benefits is 500 weeks. Section 39-71-706, MCA (1983).

To determine an indemnity benefit claim under §§ 39-71-705 through -708, MCA(1983), the court must consider the claimant’s age, education, work experience, pain and disability, actual wage loss, and loss of future earning capacity. Carroll v. Wells Fargo Armored Serv. Corp. & CNA (1990), 245 Mont. 495, 499, 802 P.2d 618, 621 (citing Holton v. F.H. Stoltze Land and Lumber Co. (1981), 195 Mont. 263, 266, 637 P.2d 10, 12). As we have previously stated, the purpose of indemnity benefits is to indemnify the injured worker for “possible” loss of future earning capacity, rather than any “actual” loss of earning capacity. Stuker, 822 P.2d at 107.

Burglund may not have a present physical restriction on his work; however, this does not mean that he will not suffer a possible loss of future earning capacity as a result of his injury. One-half of the twenty percent disability award is represented by the impairment award, which is strictly a medical determination. UPS attacked this medical determination before the Workers’ Compensation Court but did not appeal this issue. Given the ten percent impairment rating, the court awarded an additional ten percent for factors other than medical impairment. The court’s award of an additional ten percent does not, as a matter of law, require that Burglund be currently physically restricted in either his employment or his recreational activities. It is an award to compensate future possible loss of earning capacity. There is sufficient evidence in the record which supports the court’s conclusion that Burglund could possibly be forced to quit his position with UPS and therefore suffer future possible loss of earning capacity.

We therefore determine the Workers’ Compensation Court did not err in concluding that Liberty is liable under §§ 39-71-705 through -708, MCA (1983), for payment to Burglund of 100 weeks of permanent partial disability benefits, representing a twenty percent disability.

We affirm both issues raised on appeal.

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