text:
    PETER J. WORTS, Claimant and Appellant, v. HARDY CONSTRUCTION COMPANY, Employer, and PACIFIC EMPLOYERS INSURANCE COMPANY, Defendant and Respondent.
    No. 91-067.
    Submitted on Briefs June 18, 1991.
    Decided Aug. 29, 1983.
    249 Mont. 477.
    817 P.2d 231.

      Lloyd E. Hartford, Billings, for claimant and appellant.
    Andrew J. Utick, Utick & Grosfield, Helena, for defendant and respondent.
   JUSTICE GRAY

delivered the Opinion of the Court.

On January 26, 1989, the Workers’ Compensation Court determined that the claimant was entitled to an award of reasonable costs and attorney’s fees pursuant to § 39-71-611, MCA (1983). An evidentiary hearing was held to determine the amount to be awarded and, on November 30, 1990, the Workers’ Compensation Court issued an order awarding attorney’s fees of $3,329.39 based on the contingent fee agreement between the claimant and his attorney. From this order, the claimant appeals. We affirm.

The claimant raises the following issues on appeal:

1. Did the Workers’ Compensation Corut abuse its discretion by awarding attorney’s fees in accordance with the contingent fee agreement and not on an hourly basis?

2. Should attorney’s fees be awarded for the time spent litigating the fee issue?

3. Should attorney’s fees be based on future benefits as well as the reinstated temporary total disability benefits and payment for psychological counseling if the contingent fee agreement controls?

The respondent raises as an additional issue on appeal whether sanctions should be imposed against the claimant pursuant to Rule 32, M.R.App.P., for bringing this appeal.

The claimant, Peter Worts, sustained a work-related injury on June 30, 1983. The respondent, Pacific Employers Insurance Company, accepted liability and paid the claimant temporary total disability benefits of $263 per week. Later, effective May 8, 1986, the respondent reduced the claimant’s benefits from temporary total to permanent partial at a rate of $131.50 per week.

Following the reduction in benefits, the claimant retained attorney Lloyd Hartford to represent him in connection with his claim for benefits. The claimant and Mr. Hartford entered into a contingent fee agreement which provided in part:

“4. That the Attorney accepts this employment, and the Client agrees to pay the Attorney, a fee not to exceed the following amounts:
“(b) For cases that go to a hearing before the Workers’ Compensation Judge, thirty-three percent (33%) of the amount of compensation payments the Client received from an order of the Workers’ Compensation Court.

On January 30,1987, the claimant filed a petition for an emergency trial with the Workers’ Compensation Court requesting reinstatement of his temporary total benefits and payment for psychological counseling. Prior to the trial, the respondent moved to dismiss the case upon the ground that, as a result of the 1987 amendments to the Workers’ Compensation Act regarding mandatory mediation of claims, the Workers’ Compensation Court lacked subject matter jurisdiction. This motion was denied by the Workers’ Compensation Court and the matter proceeded to trial.

The respondent then filed an application for a writ of supervisory control with this Court. On February 3, 1988, we issued our opinion concerning the jurisdictional issue, holding that the 1987 amendments to the Act covering dispute resolution did not apply retroactively to cases in which petitions had been filed with the Workers’ Compensation Court prior to July 1, 1987, the effective date of the amendments; therefore, the Workers’ Compensation Court had jurisdiction. See State ex rel. Pac. Emp. Ins. Co. v. Workers’ Comp. Court (1988), 230 Mont. 233, 749 P.2d 522.

By the time the jurisdictional question had been resolved, the trial had already been held on eight issues raised by the claimant. On January 26, 1989, the Workers’ Compensation Court entered its findings of fact, conclusions of law and judgment, ruling in the claimant’s favor on three issues, including reinstatement of temporary total disability benefits retroactive to the date such benefits were reduced by the respondent, an award of medical benefits for psychological treatment, and an award of reasonable costs and attorney’s fees. The court ruled in the respondent’s favor on the five remaining issues.

The Workers’ Compensation Court directed Mr. Hartford to submit a statement of the hours he spent in pursuing the matter, the costs incurred, a statement of his customary and current hourly fee and a copy of the fee agreement as approved by the Division of Workers’ Compensation. On February 14, 1989, Mr. Hartford filed Claimant’s Memorandum of Time and Costs in which he moved for an award of fees in the amount of $48,510 and costs of $1,202.40. Mr. Hartford claimed that he spent 215.60 hours on the case. He also asserted that he does not charge an hourly rate in the regular course of business, but claimed that $225 represented a reasonable hourly fee for his services based upon an accountant-prepared formula utilized for determining his hourly cost of doing business.

The respondent requested an evidentiary hearing regarding the propriety of the requested award of attorney’s fees. A dispute arose during the preparation for that hearing concerning Mr. Hartford’s refusal to completely answer certain interrogatories; the dispute culminated in the Workers’ Compensation Court imposing sanctions against Mr. Hartford in the amount of $1,000. Thereafter, the claimant filed a motion to disqualify the Workers’ Compensation Judge. The Workers’ Compensation Court denied the motion but appointed a hearing examiner to hear the attorney fee matter and make proposed findings and conclusions.

On July 24, 1990, Mr. Hartford moved to supplement his request for attorney’s fees and costs to add a claim for 67 additional attorney homrs and ten paralegal hours for time spent in pursuing the claim for attorney’s fees. Again, the claim was based upon a rate of $225 per hour for Mr. Hartford, with $35 per hour claimed for paralegal time. Thus, as of July 24, 1990, the total amounts requested for attorney’s fees and costs were $63,935 and $1,202.40, respectively.

The evidentiary hearing was held on August 20, 1990. The pertinent issue to be decided at the hearing, as stated in the pretrial order, was:

“The amount of attorney’s fees and costs to be awarded to claimant’s counsel and whether claimant is entitled to attorney’s fees based on an hourly rate as set forth in his memorandum of time and costs filed February 14, 1989, together with added fees and costs as supplemented on July 24, 1990 and hours to be supplemented at the termination of the case.”

On November 30,1990, the hearing examiner entered his Findings of Fact, Conclusions of Law and Proposed Judgment. The examiner found that, based on the evidence presented at the hearing, the January 26, 1989 decision of the Workers’ Compensation Court resulted in the payment of $8,124.05 in reinstated temporary total disability benefits to the claimant. In addition, the decision resulted in the payment of $1,965 in medical benefits to Dr. Traynham for psychological counseling. Thus, Mr. Hartford recovered a total of $10,089.05 for the claimant by reason of the order of the Workers’ Compensation Court. The examiner further found that Mr. Hartford failed to present strong countervailing evidence sufficient to overcome the presumption in favor of the contingent fee agreement as establishing a reasonable fee; therefore, in accordance with the contingent fee agreement, Mr. Hartford was entitled thirty-three percent of the total award received by the claimant, or $3,329.39, plus costs of $1,202.40. The respondent was entitled to credit the $1,000 sanction against Mr. Hartford against the award of fees and costs. The Workers’ Compensation Court adopted the findings of fact and conclusions of law and entered judgment on November 30, 1990. A rehearing was denied on January 7, 1991.

I.

Did the Workers’ Compensation Court abuse its discretion by awarding attorney’s fees in accordance with the contingent fee agreement and not on an hourly basis?

In determining attorney’s fees, the Workers’ Compensation Court examined the factors set out by this Court in Wight v. Hughes Livestock Co., Inc. (1983), 204 Mont. 98, 664 P.2d 303, for assessing the reasonableness of a contingent fee agreement. Those factors include:

“(1) The anticipated time and labor required to perform the legal service properly.
“(2) The novelty and difficulty of legal issues involved in the matter.
“(3) The fees customarily charged for similar legal services.
“(4) The possible total recovery if successful.
“(5) The time limitations imposed by the client or circumstances of the case.
“(6) The nature and length of the attorney-client relationship.
“(7) The experience, skill and reputation of the attorney.
“(8) The ability of the client to pay for the legal services rendered.
“(9) The risk of no recovery.’”

Wight, 204 Mont. at 114, 664 P.2d at 312 (quoting Clark v. Sage (1981), 102 Idaho 261, 629 P.2d 657, 661). Atenth factor noted by this Court is “the market value of the lawyer’s services at the time and place involved.” Wight, 204 Mont. at 114, 664 P.2d at 312. In addition, we stated that:

“In considering... [the claimant’s] contingent fee contract with his attorney, the Workers’ Compensation judge should accept the approved contract as having a strong presumption in its favor. If the judge does not set a fee in accordance with the contingent fee contract, he shall state with particularity his reasons in writing, based upon strong countervailing evidence, why the contingent fee contract is not followed by him, and precisely what weight he accorded to the contingent fee contract.” Wight, 204 Mont. at 115, 664 P.2d at 312.

The Workers’ Compensation Court concluded that the contingent fee agreement between Mr. Hartford and the claimant established a reasonable attorney’s fee based on its determination that Mr. Hartford failed to present strong countervailing evidence sufficient to overcome the presumption in favor of the contingent fee agreement. The Workers’ Compensation Court concluded that:

“Mr. Hartford did not offer any testimony or evidence whatsoever regarding the ten factors that must be considered under Wight, supra. ... [H]is entire case was designed to show that his cost of doing business justified an hourly rate of $225.00. An attorney’s cost of doing business is not a proper factor for consideration under Wight or under Rule 1.5 of the Rules of Professional Conduct. Mr. Hartford simply did not attempt to meet his burden of presenting evidence that his contingency fee did not establish a reasonable fee.”

Mr. Hartford challenges the Workers’ Compensation Court’s award of attorney's fees, arguing that, on its face, a fee of $3,329.39 for 215.60 hours of work is unreasonable. He also asserts that the Workers’ Compensation Court erred in its application of several of the Wight factors.

This Court has held that workers’ compensation benefits, including the claimant’s award of attorney’s fees, are determined by the statutes in effect on the date of the injury. Cadwell v. Bechtel Power Corp. (1987), 225 Mont. 423, 732 P.2d 1352. Here, the claimant was injured on June 30, 1983, before the 1985 amendments to §§ 39-71-612 and 39-71-614, MCA. Therefore the 1983 statutes govern this case. Section 39-71-611, MCA (1983), gives the Workers’ Compensation Court discretion to determine reasonable attorney’s fees. Swan v. Sletten Construction Co. (1986), 223 Mont. 477, 480, 726 P.2d 1170,§ 1172. Thus, this Court will not interfere with the Workers’ Compensation Corut’s determination of reasonable attorney’s fees absent an abuse of discretion. Swan, 223 Mont. at 480, 726 P.2d at 1172.

We find no abuse of discretion on the part of the Workers’ Compensation Court. The issue to be determined at the evidentiary hearing, as set forth in the pretrial order, was the “amount of attorney’s fees and costs to be awarded ... and whether claimant is entitled to attorney’s fees based on an hourly rate as set forth in his memorandum of time and costs ....” At the hearing, Mr. Hartford’s only evidence was that of his accountant, Richard Hobbs, who testified regarding Mr. Hartford’s alleged cost of doing business and the formula for determining an hourly rate from that cost of doing business. Mr. Hartford did not testify on his own behalf, present any other attorney to testify on his behalf, offer any evidence concerning the Wight factors, or make any effort whatsoever to overcome the presumption in favor of the contingent fee agreement. Moreover, subsequent to the evidentiary hearing Mr. Hartford abandoned his theory that attorney’s fees should be set at $225 per hour based upon his cost of doing business and, in Claimant’s Proposed Findings of Fact, Conclusions of Law and Judgment, he proposed that the Workers’ Compensation Court award attorney’s fees at a rate of $125 per hour, his prior hourly rate. However, no evidence was presented at the hearing regarding Mr. Hartford’s prior hourly rate.

The respondent presented evidence from Geoffrey Keller, an attorney experienced in representing claimants in workers’ compensation matters. It was Mr. Keller’s opinion that this case was a rather routine case, and that the work required to be performed was not sufficient or unusual enough to take the case outside the presumption in favor of the contingent fee contract as establishing a reasonable attorney’s fee. The Workers’ Compensation Court ultimately agreed with Mr. Keller.

In addition, Mr. Hartford’s assertion that a fee of $3,329.39 for 215.60 hours of work is patently unreasonable is unfounded. In Buckman v. Montana Deaconess Hospital (1989), 238 Mont. 516, 776 P.2d 1210, we held that a claimant’s attorney is entitled to attorney’s fees only on those issues upon which the claimant prevailed in a workers’ compensation case. In this case, the claimant prevailed on three of eight issues and Mr. Hartford made no attempt to identify the hours he devoted to those issues.

Mr. Hartford further asserts that, as the party moving for the evidentiary hearing, the respondent had the burden of proof to establish that the claim for attorney’s fees was unreasonable. He argues that the record speaks for itself and no additional evidence was required regarding the claim for attorney’s fees. We disagree. As already noted, a contingent fee agreement carries with it a presumption of establishing a reasonable fee under our decision in Wight. It follows logically that the party contesting the reasonableness of the contingent fee agreement has the burden of overcoming the presumption. It was the claimant in this case who contested the reasonableness of the contingent fee agreement and he had the burden of overcoming the presumption of reasonableness. Having presented no evidence regarding the Wight factors in determining the reasonableness of the contingent fee agreement, he failed to carry his burden of proof. We hold that the Workers’ Compensation Court did not abuse its discretion by awarding attorney’s fees in accordance with the contingent fee agreement.

II.

Should attorney’s fees be awarded for the time spent litigating the fee issue?

The claimant contends that he should be awarded attorney’s fees for time spent litigating the fee issue, arguing that the effect of holding otherwise diminishes the value of the attorney's fees awarded by the order of the Workers’ Compensation Court.

As noted previously, the claimant is entitled to attorney’s fees only as to those issues on which he prevailed. Buckman, 238 Mont. 516, 776 P.2d 1210. The claimant did not prevail on his argument that the contingent fee agreement did not establish a reasonable attorney’s fee. Therefore, we hold that the Workers’ Compensation Court correctly refused to award Mr. Hartford attorney’s fees for litigating the issue.

III.

Should attorney’s fees be based on future benefits as well as the reinstated temporary total disability benefits and payment for psychological counseling if the contingent fee agreement controls?

The claimant contends that if this Court is not persuaded that attorney’s fees should be awarded on an hourly basis, the fees awarded under the contingent fee agreement should take into account future benefits as well as the reinstated temporary total disability benefits and payment for psychological counseling. He notes that his 'underlying claim for benefits was subsequently settled on January 18, 1991, for $65,750 on a full and final compromise basis.

Mr. Hartford received exactly what his fee agreement provided for, thirty-three percent of the compensation payments the claimant received from an order of the Workers’ Compensation Court, determined in accordance with the evidence presented at the hearing. The action involved only a claim for reinstatement of temporary total disability benefits and payment for psychological counseling. The evidentiary hearing was held to determine a reasonable attorney’s fee for Mr. Hartford’s efforts in obtaining those benefits for the claimant. Resolution of the underlying claim for benefits was a matter completely separate from the present action. The order approving the full and final compromise settlement was not even in existence at the time of the evidentiary hearing on attorney’s fees and is not properly part of the record on appeal. Therefore, we hold that the Workers’ Compensation Court correctly determined attorney’s fees based only on the reinstatement of temporary total disability benefits and payment for psychological counseling.

We also note that in support of his argument on this issue, the claimant’s attorney cited a nonciteable, unpublished opinion of this Court. In December 1989, we amended our Internal Operating Rules to allow for nonciteable, unpublished, abbreviated opinions in certain cases. We take this opportunity to remind counsel that such opinions shall not be cited as precedent.

IV.

Should sanctions be imposed against the claimant pursuant to Rule 32, M.R.App.P., for bringing this appeal?

Rule 32, M.R.App.P., provides:

“If the supreme court is satisfied from the record and the presentation of the appeal in a civil case that the same was taken without substantial or reasonable grounds, such damages may be assessed on determination thereof as under the circumstances are deemed proper.”

Where a reasonable ground for appeal exists, sanctions or damages will not be imposed under Rule 32, M.R.App.P. Searight v. Cimino (1988), 230 Mont. 96, 103-04, 748 P.2d 948, 952. We believe that the statutory and case law governing attorney’s fees in this case, and the Workers’ Compensation Court’s actions in accordance therewith, were sufficiently clear. The claimant’s total abandonment of the attorney fee theory he propounded at the evidentiary hearing, after that hearing, lends further credence to the existence of such clarity. Because of a modicum of legitimate confusion as to the burden of proof at the evidentiary hearing regarding attorney’s fees, however, a barely reasonable ground for appeal did exist. For that reason, we will not impose sanctions against the claimant.

Affirmed.

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


source: Caselaw Access Project

author: JUSTICE WEBER JUSTICE TRIEWEILER,

license: Public Domain

text:
    LEO F. MARAZZATO, SR., Acting as Personal Representative on Behalf of the Heirs and Successors in Interest of LEO F. MARAZZATO, JR., Plaintiff and Appellant, v. BURLINGTON NORTHERN RAILROAD COMPANY, a Delaware Corporation, Defendant and Respondent.
    No. 90-566.
    Submitted on briefs May 31, 1991.
    Decided Aug. 29, 1991.
    249 Mont. 487.
    817 P.2d 672.

      Don C. Aldrich, William G. Jungbauer, Patrick R. Gillespie, Yaeger & Yaeger, Minneapolis, Minn., John W. Larson, Missoula, for plaintiff and appellant.
    Randy J. Cox, and Boone, Karlberg & Haddon, Missoula, for defendant and respondent.
   JUSTICE WEBER

delivered the Opinion of the Court.

Plaintiff, Leo F. Marazzato, Sr. (Mr. Marazzato), is the father and personal representative of Leo F. Marazzato, Jr. (the decedent). Mr. Marazzato brought this Federal Employers’ Liability Act (FELA) action in the District Court for the Fourth Judicial District, Missoula County, seeking emotional distress damages suffered by the decedent prior to the decedent’s death by suicide, and for the pecuniary loss the parents suffered after the decedent’s death. The District Court granted Burlington Northern’s Motion for Summary Judgment concluding that Mr. Marazzato had not established that it was foreseeable by Burlington Northern that its actions would result in the decedent’s suicide. Mr. Marazzato appeals. We affirm.

The revised dispositive issue is: Did the District Court correctly conclude that the plaintiff failed to present sufficient proof to establish that Burlington Northern knew or should have known that assignment to an unsupervised rubber room could have resulted in foreseeable harm to the decedent?

The decedent worked as a clerk for Burlington Northern from 1976 until his suicide in March, 1988. Under a collective bargaining agreement, he was a “merger protected” employee which means that Burlington Northern was obligated to pay his wages even if it had no work for him to do. Upon sale of Burlington Northern’s southern line to Montana Rail Link, Burlington Northern had more clerks in Missoula than needed. Beginning March 14, 1988, the decedent was assigned to an Alternative Work Location (known as a “rubber room” by employees) in Missoula. Employees who were assigned to the rubber room were required to report to the room for work shifts but had no work to do. The employees were free to read, watch television, play cards, and otherwise entertain themselves. There were no supervisors available or in attendance in the rubber room.

On March 22, 1988, the decedent was notified that he was being transferred to Havre, Montana. He had the option of accepting the transfer by reporting to work in Havre within 20 days, taking a six month leave of absence without pay, or resigning and accepting a separation allowance.

Evidence in the form of affidavits, depositions, and medical records show that the decedent’s mental health deteriorated rapidly during the month of March. The decedent threatened to commit suicide several times during the month. On March 27, 1988, his Mother called the police and the decedent agreed to enter the hospital under the care of a psychiatrist. He was released the following day. That same day he received another letter indicating that it had come to the attention of Burlington Northern that his “home zone” was in Helena, Montana and that he was being reassigned to the rubber room in Helena. On March 29,1988, the decedent bought a gun at a secondhand shop, drove up to the South Hills area of Missoula and killed himself.

Mr. Marazzato argues that the decedent’s assignment to the unsupervised rubber room caused his mental and emotional condition which was the direct and proximate result of Burlington Northern’s negligence in failing to provide the decedent with a safe place to work in violation of FELA [45 U.S.C. § 51, et seq.]. The District Court granted summary judgment to Burlington Northern on the basis of foreseeability. Mr. Marazzato contends that the District Court erred because affidavits from expert witnesses sufficiently established foreseeability of harm to reach the jury in a FELA case.

Dr. James C. Deming, licensed psychologist from Bozeman, Montana, and Dr. Marie-Claude Rigaud, licensed psychiatrist from Aurora, Illinois, presented affidavits after analyzing the medical records and depositions available in this case. Both experts concluded that the decedent was suffering from major depression and dependent personality disorder prior to his death. Dr. Deming also concluded that decedent’s behavior was consistent with “isolation stress” similar to the reactions found among military personnel stationed at isolated military stations.

Dr. Rigaud observed that the decedent had been under the effect of a multitude of moderate to severe job stressors for some time before his assignment to the rubber room. Those earlier stressors included two imposed job transfers which involved change, deprivation of the support of significant others, perception of inadequate preparation and training to do the job safely and effectively, and poor fit between the individual and his environment. His responses to those stressors were expressed fears, depression, and feelings of loneliness and emptiness, as well as insecurity and job dissatisfaction. The organization changes within the company added new stressors such as uncertainty about his employment future. Confinement in the rubber room without identified objectives or well-defined expectations as to what was to be achieved resulted in boredom and lack of meaningful purpose which created additional stressors. Based on these observations, Dr. Rigaud came to the following conclusions:

“(1) The conditions of [decedent’s] employment at [Burlington Northern] constituted major traumata which led to a progressive emotional deterioration, and eventually to his latest episode of agitated suicidal depression.
“(2) Additionally, acute stressors which came to bear after his discharge from the hospital further exacerbated an already precarious condition and led to more psychological distress, acute despair, confusion, impaired reality testing and judgment.
“(3) [Decedent] killed himself as a result of an irresistible impulse brought about by his emotional condition described above.
“(4) [Burlington Northern] should have been able to foresee the potentially detrimental impact that such stressful working conditions would have had on their employees. At the least, the company should have assigned a supervisory personnel who could have observed and monitored such effects as they were becoming evident.”

Mr. Marazzato asserts these expert conclusions were sufficient to establish foreseeability in a FELA case.

Under FELA, the test of whether a case should go to a jury is simply whether the evidence justifies with reason the conclusion that employer negligence played any part, even the slightest, in producing the injury or death for which damages are sought. Rogers v. Missouri Pac. R.R. (1957), 352 U.S. 500, 506, 77 S.Ct. 443, 448, 1 L.Ed.2d 493, Mr. Marazzato cites Rogers for the proposition that FELA is liberally construed to require only a slight amount of foreseeability to get a FELA case to a jury. The Rogers Court went on to say “[i]t does not matter that, from the evidence, the jury may also with reason, on grounds of probability, attribute the result to other causes, including the employee’s contributory negligence.” Rogers, 352 U.S. at 506, 77 S.Ct. at 440. It is obvious from this statement that the Rogers case was addressing the issues of multiple causes and contributory negligence after it had been established that the employer was negligent. Also see Gallick v. Baltimore & Ohio R.R. (1963), 372 U.S. 108, 116, 83 S.Ct. 659, 664-665, 9 L.Ed.2d 618; Barilla v. Atchison, Topeka & Santa Fe Ry. (D. Ariz. 1986), 635 F.Supp. 1057, 1059.

The plaintiff has the burden of proving that defendant’s negligence was the proximate cause in whole or in part of plaintiff’s [death]. Barilla, 635 F.Supp. at 1059. Reasonable foreseeability of harm is an essential ingredient of FELA negligence. Gallick, 372 U.S. at 117, 83 S.Ct. at 665.

Mr. Marazzato has failed to provide any proof that Burlington Northern knew or should have known that assignment of the decedent to an unsupervised rubber room created a reasonable possibility of harm. Affidavits of medical experts that establish a medical theory do not demonstrate knowledge on the part of Burlington Northern. We agree with the conclusion of the District Court that FELA

“... requires some proof before being submitted to the jury; here there is no suggestion of any kind in any of the evidence submitted to the Court that would give rise to a finding of foreseeability with respect to a suicide arising from the use of the [rubber room], by any of the employees, or by this specific employee.”

We hold that the District Court did not err in concluding that Mr. Marazzato failed to establish reasonable foreseeability of harm absent sufficient facts to constitute notice to Burlington Northern.

Mr. Marazzato argues that he was prevented from establishing Burlington Northern’s knowledge of the effects of rubber rooms on the employees because the District Court granted Burlington Northern’s Motion for a Protective Order during discovery. There is no basis for Mr. Marazzato’s contention. While it is true that the District Court did grant Burlington Northern protection as to several interrogatories, the District Court denied the motion as to Interrogatory No. 30 which stated:

“Please identify each and every paper, study, report and memoranda outlining the actual, possible or anticipated mental or emotional impact or the use of ‘rubber rooms’ on employees such as plaintiff’s decedent which Burlington Northern has in its possession or has access to.”

Through Interrogatory No. 30, Mr. Marazzato had access to all documents in Burlington Northern’s possession that could have established Burlington Northern’s knowledge. Mr. Marazzato failed to prove that Burlington Northern should have foreseen harm to the decedent.

We hold that the District Court correctly concluded that the plaintiff failed to present sufficient proof to establish that Burlington Northern knew or should have known that assignment to an unsupervised rubber room could have resulted in foreseeable harm to the decedent.

Affirmed.

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

JUSTICE TRIEWEILER,

specially concurring:

I concur in the result achieved by the majority’s opinion. However, I would arrive at the same conclusion for different reasons.

Plaintiff sought two separate types of damages in the District Court. He sought damages for the decedent’s emotional distress, which he alleged was negligently caused prior to decedent’s death, and he sought damages which resulted because of decedent’s death. Both claims were dismissed based on lack of foreseeability. However, plaintiff raised two issues on appeal:

1. Whether an FELA claimant may recover damages for emotional injuries which are negligently inflicted, even though there is no physical injury or threat of physical harm; and

2. Whether he had offered sufficient evidence on the issue of foreseeability to overcome defendant’s motion for summary judgment.

Because plaintiff’s action was brought pursuant to the Federal Employers’ Liability Act, the conduct which gives rise to a cause of action and the nature of damages recoverable are controlled by federal statutes and case law.

The only case law cited by either of the parties which appears to clearly allow recovery for negligent infliction of emotional distress is Buell v. Atchison, Topeka & Santa Fe Ry. Co. (9th Cir. 1985), 771 F.2d 1320, 1324. However, Buell was reversed by the United States Supreme Court in Atchison, Topeka & Santa Fe Ry. Co. v. Buell (1987), 480 U.S. 557, 107 5.Ct. 1410, 94 L.Ed.2d 563. Plaintiff has cited this Court to no federal decisional law since reversal of the Buell decision, which clearly allows recovery for the negligent infliction of emotional distress absent infliction of physical harm to the plaintiff.

Montana has allowed recovery for negligent infliction of emotional distress under limited circumstances which are not present in this case. Versland v. Caron Transport (1983), 206 Mont. 313, 322- 23, 671 P.2d 583, 588. However, we have been reluctant to extend the cause of action beyond those circumstances described in Versland. Day v. Montana Power Co. (1990), 242 Mont. 195, 789 P.2d 1224.

While there may be sound public policy arguments for extending the circumstances under which a cause of action for negligent infliction of emotional distress may be presented, I do not believe that the railroad workplace is the place to begin, absent some authority from the federal decisions or statutes.

I would affirm the District Court’s judgment dismissing that part of plaintiff’s claim which relates to the decedent’s suicide based on the following general rule set forth in Krieg v. Masse (1989), 239 Mont. 469, 781 P.2d 277:

“The general rule, as relied upon by the District Court, in the area of civil liability for suicide is that ‘[n]egligence actions for the suicide of another will generally not lie since the act or suicide is considered a deliberate intervening act exonerating the defendant from legal responsibility ...’ 41 ALR 4th, 353. Prosser and Keeton on Torts § 44 at 280-81 (4th ed. 1971); McPeake v. Cannon Esquire, P.C. (1989), 381 Pa. Super. 227, 553 A.2d 439; McLaughlin v. Sullivan (1983), 123 N.H. 335, 461 A.2d 123. We expressly adopt this rule.”

Krieg, 239 Mont. at 472-73, 781 P.2d at 279.

The plaintiffs sought to survive summary judgment by coming within the following exception to the general rule:

“a. [WJhere the defendant’s tortious act causes a mental condition in the decedent that proximately results in an uncontrollable impulse to commit suicide or that prevents the decedent from realizing the nature of his act...”

Krieg, 239 Mont. at 471, 781 P.2d at 278.

However, there was no substantial evidence in this record that decedent took his life because of a mental condition caused by defendant’s tortious act. The tortious act alleged by plaintiff was defendant’s failure to supervise the work site to which plaintiff’s decedent was confined. However, there was no evidence that that lack of supervision contributed in any way to the mental condition which resulted in decedent’s suicide. In fact, the evidence, including decedent’s medical records and the history reconstructed by the plaintiff’s own consultants, indicates that the mental condition which led to decedent’s suicide was caused by notice to him that he was being transferred to a new location where he would be apart from his parents and without friends.

Furthermore, decedent’s suicide did not occur at the work place. It occurred in a remote area near Missoula after he had been discharged from the care of professional psychologists or psychiatrists. Had there been indications of despondency or depression while at work which could have been detected by closer supervision, nothing more could have been expected from defendant than a referral to the health care professionals who ultimately saw and treated decedent shortly before his suicide. Therefore, I would conclude that decedent’s suicide was a deliberate intervening act exonerating defendant from legal responsibility for decedent’s death, and on that basis affirm the District Court.


author: JUSTICE HARRISON JUSTICE WEBER,

text:
    In re the MARRIAGE OF GAVIN DUANE CASTOR, Petitioner and Appellant, and SHIRLEY MAE CASTOR, Respondent and Respondent.
    No. 91-200.
    Submitted on briefs June 13, 1991.
    Decided Aug. 29, 1991.
    249 Mont. 495.
    817 P.2d 665.

      James D. Elshoff, Great Falls, for petitioner and appellant.
    Marcia Birkenbuel, Great Falls, for respondent.
   JUSTICE HARRISON

delivered the Opinion of the Court.

Gavin Castor appeals from a February 20, 1990, order of the District Court of the Eighth Judicial District, Cascade County, Montana, denying his motion for modification of spousal maintenance payments and ordering him to pay Shirley Castor $6,066 in past-due maintenance payments, $4,000 representing Mrs. Castor’s remaining share of his civil service retirement fund, $300 per month spousal support, and $250 in attorney’s fees. We affirm.

We frame the issues as follows:

1. Should the District Court have set aside the February 20,1991, order under Rule 60(b), M.R.Civ.P. because of mistake, inadvertence, excusable neglect, or any other reason justifying relief?

2. Does a State District Court have the authority in a dissolution action to order the United States Office of Personnel Management to pay directly to a former spouse a share of a civil servant’s monthly disabihty retirement annuity payments?

3. Did the District Court abuse its discretion by ordering Mrs. Castor to deliver all personal property in her possession awarded to Mr. Castor by the dissolution decree, after she had received in full her share of retirement benefits, past-due maintenance payments, and attorney’s fees?

4. Did the District Court abuse its discretion by awarding $250 in attorney’s fees to Mrs. Castor?

After 28 years of marriage, on April 1, 1988, Gavin D. Castor and Shirley M. Castor were granted a dissolution of marriage. Mr. Castor was required to pay $675 per month spousal maintenance until the couple’s home in Utah was sold. Maintenance would then be reduced to $300 per month until Mrs. Castor became eligible for Social Security retirement benefits. Mr. Castor was ordered to pay $4,000 to Mrs. Castor as her share of his civil service retirement pension. The parties were allowed to keep certain personal property then in their possession, and Mrs. Castor was ordered to turn over certain personal property to Mr. Castor.

On October 15, 1990, Mr. Castor moved to modify the dissolution decree by reducing the amount of spousal maintenance payments and moved to require Mrs. Castor to turn over titles to vehicles and other personal property awarded to Mr. Castor.

On December 6, 1990, Mrs. Castor requested a continuance of the hearing on the motion for modification of the dissolution decree because notice of the hearing scheduled for that date was not received until November 30, 1990. The motion was granted, and the hearing was reset for January 23, 1991.

On January 22, 1991, the District Court ordered the January 23 date for the hearing to be vacated because of a conflict in the court’s calendar and rescheduled the hearing for February 14, 1991. Both parties received written notice of the continuance. Although Mr. Castor’s counsel received the notice, he failed to see the new date of the hearing. As a consequence, neither Mr. Castor nor his attorney appeared at the hearing on February 14. After waiting for forty minutes, the District Court heard testimony from Mrs. Castor and entered judgment in her favor.

In its February 20, 1991 order, the District Court required the United States Office of Personnel Management to continue to pay Mrs. Castor $582 per month from Mr. Castor’s monthly retirement benefits until March 1991. At that time, the Office of Personnel Management was ordered to withhold $500 per month for Mrs. Castor. Of the $500 withheld, $300 was for spousal maintenance and $200 was to be applied to the balance of Mrs. Castor’s $4,000 share of retirement benefits, $6,066 in past-due spousal maintenance, and $250 in attorney’s fees. In approximately three years when these obligations to Mrs. Castor had been paid in full, the Office of Personnel Management was ordered to withhold $300 per month for spousal maintenance.

In addition, after Mrs. Castor’s share of retirement benefits, past-due maintenance, and attorney’s fees were paid in full, Mrs. Castor was required to deliver to Mr. Castor the personal property and title to vehicles awarded to him by the dissolution decree.

On March 13,1991, the District Court denied Mr. Castor’s motion to set aside the order modifying the dissolution decree. From these judgments, Mr. Castor appeals.

I.

Should the District Court have set aside the February 20, 1991, order under Rule 60(b), M.R.Civ.R for mistake, inadvertence, excusable neglect, or other reason justifying relief?

Sections (1) and (6) of Rule 60(b), M.R.CivR. provide that the court may relieve a party from a final judgment for “mistake, inadvertence, surprise, or excusable neglect” or “any other reason justifying relief from the operation of the judgment.”

Mr. Castor’s counsel argues that he is “only human” and that his mistake in failing to notice the rescheduled date of the hearing on Mr. Castor’s motion should not have been imputed to his client. Mr. Castor’s counsel maintains that medical evidence of his client’s disability would have changed the outcome of the court’s ruling.

If the district court exercises its discretion in appraising or weighing facts of a particular case, on review this Court determines whether the district court, in varying degrees, has abused or misused its discretion. See Steer, Inc. v. Department of Revenue (Mont. 1990), [245 Mont. 470,] 803 P.2d 601, 603-04, 47 St.Rep. 2199, 2200. If the district court’s decision does not involve the public policy that cases should be tried and decided on their merits, then the scope of review is the standard abuse of discretion test.

When the district court sets aside a default judgment pursuant to Rule 60(b), allowing the case to be tried on its merits, a showing of great abuse of discretion is necessary to reverse the district court’s decision. Graham v. Mack (1985), 216 Mont. 165, 172, 699 P.2d 590, 594. But when the district court has refused to set aside a default judgment, “no great abuse of discretion need be shown to warrant reversal.” Lords v. Newman (1984), 212 Mont. 359, 364, 688 P.2d 290, 293.

Generally, “mistake,” “inadvertence,” and “excusable neglect” require some justification for an error beyond mere carelessness or ignorance of the law on the part of the litigant or his attorney. Lomas and Nettleton Co. v. Wiseley (7th Cir. 1989), 884 F.2d 965, 967. Mr. Castor’s counsel has not offered an explanation other than his failure to note the rescheduled date of the hearing. Such a mistake is not enough to require setting aside a judgment under Rule 60(b), M.R.Civ.P. See Watson v. Fultz (1989), 239 Mont. 364, 369, 782 P.2d 361, 364 (no relief from judgment when attorney failed to notice hearing date in opponent’s motion to amend findings); Griffin v. Scott (1985), 218 Mont. 410, 710 P.2d 1337 (no relief from judgment when attorney failed to read mail for five weeks because of work accumulated during his absence).

The general ride is that neglect of an attorney is attributable to the client. Myers, 235 Mont. at 236, 766 P.2d at 866. Mr. Castor’s counsel relies on Lords v. Newman (1984), 212 Mont. 359, 688 P.2d 290, in which we held that attorney neglect can be excusable on the part of the client upon the proper showing. The attorney in Lords, after making a general court appearance, “totally abandoned his clients and disappeared from sight.” Lords, 212 Mont. at 367, 688 P.2d at 295.

In Paxson v. Rice (1985), 217 Mont. 521, 706 P.2d 123, we distinguished Lords because, although the attorney in Paxson failed to act in response to numerous requests by opposing counsel, he had not abandoned his client and left the state. We held that the attorney’s procrastination in filing answers and other documents was “a type of neglect which is properly attributable to a client, and which we distinguish from the abandonment in Lords.” Paxson, 217 Mont. at 525, 706 P.2d at 126. Similarly, the neglect in this case is properly attributable to the client.

In addition, the judgment of a district court can be set aside for “any other reason justifying relief from the operation of the judgment.” Rule 60 (b) (6), M.R.Civ.P. Generally, relief is afforded under subsection (6) of Rule 60(b) in extraordinary situations when circumstances go beyond those covered by the first five subsections or when a party in whose favor judgment was entered has acted improperly. Fuller v. Quire (6th Cir. 1990), 916 F.2d 358, 360; In re Marriage of Tesch (1982), 199 Mont. 240, 245, 648 P.2d 293, 296. We hold that Mr. Castor has not shown that the District Court abused its discretion in refusing to set aside the order of February 20, 1991 under Rule 60(b), M.R.Civ.P.

II.

Does a State District Court have the authority in a dissolution action to order the United States Office of Personnel Management to pay directly to a former spouse a share of a civil servant’s monthly disability retirement annuities?

Mr. Castor claims that under § 25-13-608, MCA, his retirement benefits, as “disability benefits,” are exempt from execution; therefore, the District Court did not have jurisdiction to order the United States Office of Personnel Management to pay a share of his disability retirement benefits directly to Mrs. Castor. Mrs. Castor counters that according to an Arizona case, Villasenor v. Villasenor (App. 1982), 134 Ariz. 476, 657 P.2d 889, the civil service retirement annuities Mr. Castor receives do not constitute “disability benefits.”

The issue of apportionment of civil service pensions between civil service “retirement” benefits under 5 U.S.C. § 8336 or § 8338 and civil service “disability” benefits under 5 U.S.C. § 8337 has been addressed in cases relating to division of property between spouses in community property states. See Levy v. Office of Personnel Management (Fed. Cir. 1990), 902 F.2d 1550; Villasenor v. Villasenor (App. 1982), 134 Ariz. 476, 657 P.2d 889. Although Mr. Castor asserts that these cases do not apply because Montana is not a community property state, the cases are instructive regarding apportionment of retirement and disability benefits as part of disability retirement annuities. Under § 25-13-608, MCA, although veterans’ and social security benefits are subject to execution if they are levied for child support or spousal maintenance, “disability or illness benefits” are exempt. Section 25-13-608(l)(d), MCA. If the monthly benefits Mr. Castor is currently receiving qualify as “disability” benefits, such payments are exempt from execution.

The California Supreme Court addressed apportionment of military retirement and disability pay in In re Marriage of Sternquist (Cal. 1978), 21 Cal.3d 779, 148 Cal.Rptr. 9, 582 P.2d 96. The husband became disabled, but remained in military service for twenty-six years. His regular “longevity” retirement annuity consisted of 65 per cent of his base pay; his “disability” retirement annuity was 75 per cent of his base pay. Consequently, the husband elected to receive disability retirement. The court recognized that the husband’s disability pay not only compensated him for loss of earnings because of compelled early retirement and personal suffering, but “also serves the objective of providing support for the serviceman and his spouse after he leaves the service.” Sternquist, 582 P.2d at 101. The court awarded half of the annuity which was construed as the “retirement” component of the husband’s retirement disability annuity to the wife and ruled that the “disability” component was the husband’s separate property.

In Levy v. Office of Personnel Management (Fed. Cir. 1990), 902 F.2d 1550, the court applied the principles set forth in Sternquist to civil service pensions. The court recognized that retirement pay based on disability has two components: (1) compensation to the civil servant for loss of earning power and personal suffering; and (2) retirement support. Levy, 902 F.2d at 1553. Accordingly, the rule for apportionment of retirement benefits is that the amount the civil servant receives each month as disability over and above what would have been received as longevity retirement benefits is the civil servant’s separate property; the remainder is divisible community property. Id.

The formula applicable to civil service retirement benefits was detailed in Villasenor. A civil service employee can receive retirement and disability benefits under Chapter 83, 5 U.S.C. §§ 8301-8351 (1986), of the Civil Service Code. Villasenor, 657 P.2d at 891. A civil servant can qualify for Chapter 83 benefits in several ways. When a civil service employee meets the criteria for age and length of service, he or she is entitled to “immediate retirement” benefits. 5 U.S.C. § 8336. One who is separated after completing at least five years of civil service also qualifies for an annuity, but payments do not begin until the employee is 62 years old, referred to as “deferred retirement.” 5 U.S.C. § 8338. Finally, an employee with at least five years of civil service who becomes disabled is eligible for “disability retirement,” with benefits payable immediately. 5 U.S.C. § 8337. Mr. Castor is receiving the third type of benefits, “disability retirement,” under 5 U.S.C. § 8337.

Annuities for immediate, deferred, and disability retirement are all paid from the same fund, consisting primarily of contributions in the form of deductions from employees’ pay. The annuity amounts for all three forms of retirement are calculated by use of the same basic formula, based upon the employee’s average annual pay for the three highest-earning years and years of service. 5 U.S.C. § 8339; Villasenor, 657 P.2d at 891. Disability retirement is earned during years of service just as any other retirement pension, and disability is but one of several conditions causing rights in the plan to vest. Villasenor, 657 P.2d at 892.

Depending on how many years of service the civil servant has, disability retirement can have both a “retirement” component and a “disability” component. The “disability” component becomes proportionately smaller as the years of service increase and “disappears altogether for those who ‘fall through the cracks’ by, for example, having served more than 21.9 years but being too young to take immediate retirement, or being over 60 years but having too few years of service to take immediate retirement.” Id. Mr. Castor, age 58 with 28 years of civil service employment, is one for whom the “disability” component disappears.

From the analysis presented in Villasenor, we conclude that Mr. Castor’s monthly annuity is accurately characterized as “retirement” benefits, rather than “disability” benefits. Hence, the District Court is not precluded by § 25-13-608, MCA, from ordering the United States Office of Personnel Management to pay Mrs. Castor a share of Mr. Castor’s monthly disability retirement annuity. We note that 5 U.S.C. § 8345(j)(l) allows civil service retirement benefits to be paid directly to a former spouse as provided by a court decree of dissolution. We hold that the District Court did not err in ordering the United States Office of Personnel Management to pay directly to Mrs. Castor a share of Mr. Castor’s monthly disability retirement annuity.

III.

Did the District Court abuse its discretion by ordering Mrs. Castor to deliver all personal property in her possession awarded to Mr. Castor by the dissolution decree, after she had received in full her share of retirement benefits, past-due maintenance payments, and attorneys fees?

Mr. Castor alleges that the District Court should have ordered Mrs. Castor to turn over personal property awarded to him by the dissolution decree because no Montana statute allows the court to order the items to be held until his obligations are paid.

Section 40-4-209, MCA, allows the court to order a person obligated to pay maintenance who is delinquent in an amount equal to the total of six months of support payments to “post bond, give a mortgage, or provide security or guaranty for so long as there is a support delinquency.” Section 40-4-209(2), MCA.

Mr. Castor’s support obligation for six months was $4,040; the court found that he owed $6,066 in past-due maintenance payments. Allowing Mrs. Castor to keep personal property awarded to Mr. Castor in the dissolution decree until support obligations have been paid can serve as “security or other guaranty’ as provided for by § 40-4-209, MCA. We hold that the District Court stayed within the guidelines of § 40-4-209, MCA, and did not abuse its discretion in ordering Mrs. Castor to deliver personal property belonging to Mr. Castor after the delinquent support obligation had been paid.

IV.

Did the District Court abuse its discretion by awarding $250 in attorney’s fees to Mrs. Castor?

Mr. Castor contends that the District Court abused its discretion by awarding attorney’s fees without an evidentiary hearing.

The court may award attorney’s fees in dissolution cases:

“The court from time to time, after considering the financial resources of both parties, may order a party to pay a reasonable amount for the cost to the other party of maintaining or defending any proceeding under chapters 1 and 4 of this title and for attorney’s fees ...”

Section 40-4-110, MCA. Mr. Castor asserts that the District Court did not properly consider the “financial resources of both parties.”

Since the statute is permissive, the appropriate standard of review is whether the court abused its discretion. In re Marriage of Sullivan (1990), 243 Mont. 292, 299-300, 794 P.2d 687, 691-692. We have previously stated that because an award of $400 in attorney’s fees approaches de minimis, were we to reverse, the costs on remand could easily exceed the amount originally awarded. We thus upheld the court’s award of attorney’s fees. In re Marriage of Chapin (1982), 202 Mont. 153, 156, 655 P.2d 991, 992. The same principle applies in this case. We hold that the District Court did not abuse its discretion by awarding $250 in attorney’s fees to Mrs. Castor.

Affirmed.

CHIEF JUSTICE TURNAGE and JUSTICES GRAY and McDonough concur.

JUSTICE WEBER,

dissenting:

On October 15, 1990, Mr. Castor moved to modify the dissolution decree. The petition was set for hearing on December 6,1990. On the date of that hearing, Mrs. Castor requested a continuance of the hearing because notice of hearing was not received until November 30, 1990. The motion was granted and the hearing was reset for January 23,1991. On January 22,1991, the District Court, on its own order, vacated the hearing of January 23, 1991, and rescheduled the hearing for February 14,1991. As pointed out in the majority opinion, both parties received written notice of the continuance. The counsel for Mr. Castor who had initiated the proceeding failed to note the new date of the hearing. As a result neither Mr. Castor nor his attorney were present at the hearing; and after waiting 40 minutes, testimony was taken from Mrs. Castor, and judgment was entered in her favor.

Counsel for Mr. Castor admits that it was his own failure to note the February 14 hearing which caused Mr. Castor, his client, and himself to miss the hearing. He does not in any way attempt to cover this up. He points out that his practice was to maintain two calendars with notes of scheduled court appearances and filing deadlines and to notify clients promptly when they must attend a hearing. He failed to follow that practice in this instance.

The majority points out that it will not review a decision to grant or deny a Rule 60(b) motion absent abuse of discretion. That is only a partial statement of the rule as we have most recently applied it. Using a federal Seventh Circuit Court case as authority, the majority further states that generally mistake, inadvertence and excusable neglect require some justification beyond an error, mere carelessness or ignorance of the law.

This Court’s 1990 authority on the same issue is set forth in Blume v. Metropolitan Life Ins. Co. (1990), 242 Mont. 465, 791 P.2d 784. In Blume the plaintiff filed a complaint against Metropolitan Life Insurance Co. (Metropolitan) and service was made on the State Auditor and Commissioner of Insurance. The complaint, summons and discovery documents were mailed by certified mail and were received by Metropolitan. Apparently the same were lost. Metropolitan failed to file an answer and a default judgment was eventually entered in the amount of $185,986.43. In Blume we cited the following as the controlling standard to be applied in considering the District Court’s refusal to set aside the default judgment entered against Metropolitan. The unanimous Court stated:

“Where a trial court denies a motion to set aside a default judgment the standard of review is that no great abuse of discretion need be shown to warrant reversal, or, alternatively, ‘slight abuse’is sufficient to reverse an order refusing to set aside a default. The Lords court, which drew a distinction between the standards of review applied to cases where motions to set aside default judgments had been granted and those that had been denied based its holding on two basic tenets: (1) every litigated case should be tried on its merits and default judgments are not favored and (2) trial courts have a certain amount of discretion when considering a motion to set aside a default judgment ...” (Citations omitted.) (Emphasis added.)

Blume, 791 P.2d at 785. The Court then set forth a great deal of the evidence submitted by Metropolitan to support its motion to set aside the default judgment, including the entry from the Metropolitan log which showed that the mail was received from the Commissioner on February 9, 1989; and affidavits of various other persons who normally would have received information and acted in connection with litigation, but all failed to do so. The Court concluded that the evidence produced by Metropolitan demonstrated that its failure to appear was not due to any inexcusable neglect or disrespect for court or judicial process. They pointed out that it was a mystery what happened to the summons and complaint after it arrived at Metropolitan — although there is no argument that it did arrive at Metropolitan. The majority in Blume then quoted from a 1905 Montana case which stated:

“Negligence or inadvertence directly traceable to a party litigant or his attorney, no less excusable than that disclosed by this record, has many times been held sufficient to warrant the opening of a default, and trial courts have not infrequently been reversed for their refusal to set aside defaults under such circumstances.” (Emphasis added.)

Blume, 791 P.2d at 787. Blume then concluded that the neglect in the 1905 case, where an inexperienced stenographer signed an acceptance of service and then misplaced a complaint and summons, was comparable to the loss of summons and complaint in Blume. Blume then pointed out that the judgment would adversely effect Metropolitan because the amount of the judgment exceeded $185,000.

In 1990, we concluded in Blume that an unexplained loss of a summons and complaint and subsequent failure to appear was excusable neglect. Under the present majority opinion, we are concluding that the unexplained failure to appear for a continued hearing was somehow more reprehensible than the loss of a summons and complaint. I find no basis for such a distinction.

I conclude that the neglect on the part of counsel for Mr. Castor was excusable in the same manner that the neglect on the part of Metropolitan and its various personnel was excusable. As in Blume, the judgment here adversely effected Mr. Castor. As in Blume Mr. Castor’s counsel moved promptly to set aside the default. In addition, we point out that Mr. Castor in this case was the party who originally petitioned for the modification and who has been denied his opportunity to present any evidence.

Based upon Blume I would conclude that the District Court abused its discretion and vacate the default judgment.

       In Montana disability benefits may be included in the marital estate. In re Marriage of Cooper (1990), 243 Mont. 175, 179, 793 P.2d 810, 812.


author: JUSTICE GRAY

text:
    MARTEL CONSTRUCTION, INC., Plaintiff and Respondent, v. THE STATE OF MONTANA, ACTING BY AND THROUGH THE DEPARTMENT OF HIGHWAYS OF THE STATE OF MONTANA, Defendant and Appellant.
    No. 90-519.
    Submitted on briefs Apr. 12, 1991.
    Decided Aug. 30, 1991.
    249 Mont. 507.
    817 P.2d 677.

      Marc Racicot, Atty. Gen. and W. D. Hutchinson, Asst. Atty. Gen., Helena, for defendant and appellant.
    Richard J. Andriolo, Bozeman, Patrick A. Sullivan, and Winston & Cashett, Spokane, Wash., for plaintiff and respondent.
   JUSTICE GRAY

delivered the Opinion of the Court.

The appellant, State of Montana, appeals from a judgment entered on a jury verdict rendered in the District Court of the First Judicial District, Lewis and Clark County, awarding the respondent, Martel Construction, Inc., $549,000 in damages for breach of contract. We affirm in part, reverse in part and remand for a new trial.

The sole issue for review is whether the District Court erred in ruling that Martel could recover, as an element of damages against the State, the interest expense paid on funds it was allegedly required to borrow in order to finance extra work caused by the State.

In June, 1984, the appellant, State of Montana, acting by and through the Montana Department of Highways, solicited bids for the reconstruction of the existing Burlington Northern Railroad overpass at Havre, Montana. The project called for the complete refurbishment of the existing railroad overpass and the addition of two more traffic lanes. The end result was to be a four-lane overpass consisting of a new bridge built immediately adjacent and attached to the refurbished old bridge.

The Department of Highways did not make a new survey of the existing bridge prior to putting the project out for bid. Instead, it used the plans prepared for construction in 1936 which the Department believed actually represented the elevation and dimensions of the bridge in 1984. The 1936 data was transposed onto the contract drawings sent out to contractors for bidding purposes. Martel, relying upon the accuracy of the contract drawings, submitted the lowest bid and was awarded the contract on July 27, 1984.

Martel began construction on September 12, 1984. When Martel started to construct the new bridge to attach to the old bridge, it discovered that the elevation of the old bridge and certain other dimensions were not as represented on the contract drawings. Martel was required to perform extra work not contemplated under the contract in order to make the new bridge fit. Martel completed the contract on August 1, 1986.

On January 16, 1986, prior to completing the contract, Martel submitted a series of claims associated with extra work in performing the contract to the Department of Highways for administrative resolution. Some of the claims were allowed; most were denied by the Department on April 17, 1986. Martel appealed the denial of the claims to the Department’s Board of Contract Appeals on May 9,1986. The Board affirmed the original denial on December 31, 1986.

On March 26,1987, Martel filed suit in the District Court against the state of Montana seeking damages for breach of contract. Martel sought to recover its actual construction costs for the extra work it had performed under the contract as well as the interest it had paid on funds allegedly borrowed to finance the extra work. Martel denominated the interest it had paid on the borrowed funds as “moratory interest.”

Prior to trial, the District Court requested briefs from counsel on the issue of whether “moratory interest” could be recovered as an item of damages in a contract action against the State. The District Court ruled, as a matter of law, that the “moratory interest” claimed by Martel is part of the actual damages claimed to have been incurred by Martel, rather than prejudgment interest; thus, it could be recovered as an item of special or general damages for breach of contract.

Ajury trial was held May 28 through June 8,1990. At trial, Martel presented testimony and exhibit evidence that it incurred an actual expense of $170,841.46 through the payment of interest on funds borrowed during the period 1985-1990 in order to finance the construction project and that the average interest rate dining this time was 103/4%. During closing argument Martel’s counsel, stated:

‘You will also have with you exhibit number 126 which is the moratory interest calculations .... That is the actual money that Bill Martel paid out of his pocket to a bank to finance this job. And whatever money you determine that he is entitled to you should add a factor of interest and I would suggest that once you have come up with a lump sum for delays and the... [extra construction] costs, that you can apply the 10 point three quarter percent interest.”

Later, in discussing the verdict form, counsel stated:

“I have not filled in any amounts for moratory interest because I trust that on any amounts that you find that Martel is entitled to you can apply the 10 point three quarter interest factor and come up with your own amount.”

In addition, Jury Instruction No. 23 instructed the jury that:

“Martel Construction is seeking ‘moratory interest’ damages from the State of Montana. Moratory interest is interest allowed in actions for breach of contract as damages for unlawful detention of money found due.
“As a jury, you may award moratory interest damages to Martel Construction if you find that the State of Montana caused Martel Construction to borrow money to pay for extra work or delays ordered by or caused by the State of Montana.”

At the conclusion of the trial the jury found the State had breached the contract between the parties and awarded Martel damages in the amount of $384,000 for extra work and $165,000 for “moratory interest,” for a total award of $549,000. The State appeals the portion of the judgment relating to the “moratory interest.”

Contract actions against the State of Montana are governed by Title 18, Chapter 1, part 4, MCA. The extent of the State’s liability in contract actions is set out in § 18-1-404, MCA, which provides, in pertinent part:

“Liability of state — limitations—costs. (1) The state of Montana shall be liable in respect to any contract entered into in the same manner and to the same extent as a private individual under like circumstances, except the state of Montana shall not be liable for interest prior to or after judgment or for punitive damages.”

As quoted above, except for the prohibition against interest prior to or after judgment and punitive damages, § 18-1-404(1), MCA, renders the State liable for damages in contract cases to the same extent as a similarly situated private litigant. The general measure of damages for breach of contract, including a breach of contract by the State, is set out in § 27-1-311, MCA.

“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.”

In Ehly v. Cady (1984), 212 Mont. 82, 97, 687 P.2d 687, 695, we made the following observation regarding the types of damages recoverable for breach of contract:

“An examination of Section 27-1-311, MCA,... will reveal two kinds of damages recoverable from breach of contract. Damages ‘for all the detriment caused thereby’ include all damages which in the ordinary and natural course of things are proximately caused by the breach itself. These damages are the natural result of the breach. Damages under the statute may also be recovered ‘which in the ordinary course of things would be likely to result therefrom.’ Our court, and courts everywhere, recognize this provision as permitting recovery for consequential damages within the contemplation of the parties when they entered into the contract, and such as might naturally be expected to result from its violation. Myers v. Bender (1913), 46 Mont. 497, 508, 129 P. 330, 333. These damages are the contemplated result of the breach.”

We note, in addition, that all damages for breach of contract, whether natural or contemplated, require proof of causation, certainty and foreseeability. Ehly, 212 Mont. at 97, 687 P.2d at 695. Furthermore, damages must be reasonable. Section 27-1-302, MCA.

We have held previously that interest paid by a plaintiff to a third party as a result of a defendant’s breach of contract is a proper element of damages. In Popp v. Gountanis (1986), 221 Mont. 267, 718 P.2d 340, Popp leased land from the defendant and planted and harvested crops on the land for several years. The defendant enrolled the land in a federal “payment in kind” (PIK) program and, without Popp’s knowledge or permission, received the entire PIK payment. Popp sued for breach of the lease seeking, among other damages, the increased interest incurred as a result of his inability to pay off the balance of his loan covering his farming operations, which he intended to pay with the PIK payments. The District Court awarded such damages and this Court affirmed, stating:

“The District Court found that Popp’s inability to satisfy the loan balance of $32,694.92 was directly related to Frank and Gountanis’ refusal to pay Popp his two-thirds share of the PIK benefits. Frank and Gountanis received payment for their PIK bushels in December, 1983, at which time Popp’s share became certain. Had Popp received his proper share, he would have been able to pay the loan entirely and avoid further interest charges. The accrued interest on Popp’s loan balance from that date was clearly part of his damages and we uphold the District Court award.”

Popp, 221 Mont. at 271, 718 P.2d at 343 (emphasis added). See also, Bolz v. Meyers (1982), 200 Mont. 286, 651 P.2d 606; Lee v. Andrews (1983), 204 Mont. 527, 667 P.2d 919. It is clear, therefore, that in a suit between private litigants or, indeed, against the State absent the exception in § 18-1-404, MCA, increased interest payments by a plaintiff which result from a defendant’s breach of contract, are a recoverable item of damages.

The plain language of § 18-1-404(1), MCA, makes it clear, however, that the intent of the legislature was to prohibit State liability for prejudgment or post-judgment interest in contract cases where a similarly situated private litigant would be liable for such interest. This Court upheld the constitutionality of the statutory prohibition against State liability for prejudgment and post-judgment interest in LeaseAmerica Corp. v. State (1981), 191 Mont. 462, 468-69, 625 P.2d 68, 71.

This Court has referred to interest as “damage for delay in payment of the principal obligation.” Jacques v. Montana Nat’l Guard (1982), 199 Mont. 493, 507, 649 P.2d 1319, 1327. The statutory definition of interest is “the compensation allowed by law or fixed by the parties for the use or forbearance or detention of money.” Section 31-1-104, MCA. Most cases dealing with the recoverability of interest involve claims for interest allegedly due as compensation for the detention of money. In other words, the interest sought is money which the injured party hypothetically could have earned, through investment or otherwise, if the injury-causing party timely had paid compensation for the harm. This usual approach to interest is reflected in our discussion of the general prejudgment interest statute, § 27-1-211, MCA, in Price Building Service, Inc. v. Holms (1985), 214 Mont. 456, 468-69, 693 P.2d 553, 559-60, in which we stated:

“The prejudgment interest statute, in existence since 1895, merely sets forth a broad area in which the legislature has determined prejudgment interest should be allowed as a matter of right... It is merely part of the law of damages that has, as its objective, that of making the injured person whole.
Determining whether a cause of action fits within the framework of the statute, particularly the question of whether the claim is determined or can be determined by calculation, is not always an easy one. However, the overriding purpose of the statute can be best preserved if it is remembered that its purpose is to fully compensate the injured party for the loss of use of his money during the period in which a valid claim was not paid.” [Emphasis added.]

Bearing in mind this usual approach to interest, the prohibition against the State’s liability for interest contained in § 18-1-404(1), MCA, refers to delay damages or compensation for the loss of use or detention of money. Therefore, whether referred to as prejudgment interest, moratory interest or otherwise, amounts claimed against the State for the loss of use or detention of money are “interest” within the meaning of § 18-1-404(1), MCA, and thus, not recoverable under the statute.

Examining that portion of Martel’s overall claim against the State which is referred to as “moratory interest,” it appears from the record that some part of this claim against the State may constitute actual damages, that is, out-of-pocket expenses incurred as a result of the State’s breach of contract. Martel alleged that as a result of errors in the contract drawings prepared by the State and justifiably relied upon by Martel, it had to perform extra work to complete the project. Martel further alleged that in order to finance this extra work it was required to borrow money from its bank, for which the bank charged interest. Interest paid by Martel to its bank on funds necessarily borrowed to finance the extra work is an item of actual damages recoverable under § 27-1-311, MCA, to the extent that it is ascertainable in both nature and origin and can be causally and foreseeably related to the State’s breach of contract. Although such payments made by Martel to its bank were in the form of interest, they are part of its actual damages, subject to the appropriate proof, and not “interest” chargeable against the State as prohibited by § 18-1-404(1), MCA.

This Court has recently affirmed an award of “moratory interest” between private litigants in Billings Clinic v. Peat Marwick Main & Co. (Mont. 1990), 244 Mont. 324, 797 P.2d 899, 47 St.Rep. 1464. In that case, due to the defendants’ breach of an obligation owed to the plaintiff, the plaintiff incurred an increased interest expense of $834,533. It was conceded that this amount, the increase in interest actually paid by the plaintiff as a result of the defendants’ breach, was an item of actual damages which could be recovered. However, the plaintiff also sought, and was awarded, an additional $142,076 in “moratory interest” as compensation for the loss of use of the money it actually spent in increased interest expense. In affirming the award of “moratory interest,” this Court stated:

‘When viewed from the prospect of the loss of use of the increased interest expense which the Clinic had to pay, the amount claimed as moratory interest does not exceed the limitation of damages for the breach of an obligation set forth in § 27-1-303, MCA, that no person can recover a greater amount of damages for the breach of an obligation than he or she could have gained by the full performance thereof on both sides. Again, the increased interest already incurred at the time of trial appears to be reasonably certain, and is capable of reasonable calculation. Accordingly, we find no error on this item.”

Billings Clinic, 244 Mont. at 349, 797 P.2d at 915, 47 St.Rep. at 1482. Thus, in light of Billings Clinic, “moratory interest” is not actual expense incurred, but rather is the additional compensation allowed for the loss of use of money. It necessarily follows that what this Court accepted as “moratory interest” in Billings Clinic, if claimed in a contract action against the State, would not be recoverable under § 18-1-404(1), MCA, since it falls squarely within the statutory prohibition against State liability for interest. Billings Clinic further helps clarify, consistent with our holding in Popp, that the increased interest expense incurred as a result of a breach of contract is, where appropriately proved, an item of actual damages recoverable under § 27-1-311, MCA, and under § 18-1-404(1), MCA, in an action for breach of contract by the State.

We note that both the District Court’s ruling on the “moratory interest” issue and the trial in this case predated our holding in Billings Clinic. Nonetheless, the pleadings, proof, argument and instruction in this case are not altogether consistent with Martel’s assertion that it sought to recover as “moratory interest” its out-of-pocket expenses resulting from the State’s breach. Martel’s claim for “moratory interest” and the manner in which it was presented in the District Court appear to reflect an intermingling of both a recoverable actual damage component and a prohibited “interest” component.

In light of the above, to the extent that Martel utilizes the term “moratory interest” to represent compensation for the loss of use or detention of money, the “moratory interest” is not recoverable against the State. To that extent, it is interest prior to judgment and prohibited by § 18-1-404(1), MCA, no matter what it is called. On the other hand, to the extent that what was claimed as “moratory interest” can be proved to be an item of actual damages resulting from the State’s breach of contract, it is recoverable as such, but not as “moratory interest.” Accordingly, we conclude that it is necessary to remand for a new trial on this item of damages consistent with this opinion.

Affirmed in part, reversed in part and remanded for a new trial.

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


author: JUSTICE HARRISON

text:
    IN RE THE MARRIAGE OF PAULINE S. LEE, Petitioner, Respondent and Cross-Appellant, and DONALD R. LEE, Respondent, Appellant and Cross-Respondent.
    No. 91-007.
    Submitted on briefs June 28, 1991.
    Decided September 5, 1991.
    249 Mont. 516.
    816 P.2d 1076.

      Joseph B. Gary, Bozeman, for respondent, appellant and cross-respondent.
    Michael G. Moses, Moses Law Firm, Billings, for petitioner, respondent and cross-appellant.
   JUSTICE HARRISON

delivered the Opinion of the Court.

Donald R. Lee and Pauline S. Lee appeal from an August 24,1990, amended final decree of dissolution entered by the District Court of the Thirteenth Judicial District, Yellowstone County, Montana. We affirm in part and reverse in part.

The parties present the following issues:

1. Did the District Court abuse its discretion by failing to consider tax consequences of the marital distribution?

2. Did the District Court abuse its discretion by failing to award interest on deferred cash payments to the wife?

The thirty-nine year marriage of Pauline S. Lee and Donald R. Lee was dissolved on August 24, 1990. At the time of the amended final dissolution decree, the wife was 64 years of age and was receiving medical treatment for a heart problem, stomach ulcer, chronic bronchitis, emphysema, arthritis, and depression. In addition, she had been seeing a psychologist for two years for treatment of depression. The husband was 69 years old and in good health. The couple had four grown children.

According to the final decree, of the total marital estate of $5,830,507, the wife was awarded $2,222,540, leaving the husband with $3,607,967 in assets. The court stated that a larger proportion of the marital estate had been distributed to the husband to allow for property belonging to him before the marriage.

Prior to the decree of dissolution, the wife previously received $222,540. The court ordered the husband to pay the additional $2,000,000 in assets comprised of certain real properties valued at $678,477, $400,000 in cash upon entry of the decree, and $921,523 to be paid in two annual cash installments of $460,761.50 each without interest.

The husband’s assets prior to distribution consisted of cash totaling $126,489; contracts for deed worth $49,038; farm machinery valued at $163,400; investments in seven businesses with the husband’s share totaling $1,923,023, primarily in real estate holdings; other real estate valued at $1,980,927; and stocks and bonds valued at $1,873,189. Added to these were $220,207 in assets testified to at trial. Among the real estate holdings were over 8,000 acres of farm and ranch property. The court found that the husband had approximately $440,000 in liabilities, including a $380,000 debt related to farm operations.

This appeal concerns the cash transfers totaling $1,321,523 over a two-year period. The husband alleges that the District Court did not consider the tax consequences of liquidation of assets to meet the cash payments. The husband proposes that more of the real estate assets be transferred to the wife in lieu of cash.

The wife argues that the court erred in failing to allow interest on the two annual cash installments.

I.

The husband asserts that the District Court abused its discretion by failing to consider tax consequences in apportioning the marital estate, resulting in an inequitable distribution of the couple’s property.

The majority of the couple’s assets were in real estate and farming operations. According to the husband, since the real estate market in the Billings area is depressed, the properties do not generate substantial income. At the same time, the husband claims that he needs income from the stocks and bonds to pay in excess of $100,000 per year in property taxes on the real estate holdings. Approximately $249,734 worth of real property belonging to the couple already had been forfeited for tax delinquencies. The husband also asserts that federal income taxes would consume most of the profits from a sale of farm property owned by the couple.

The wife testified that she wanted cash, rather than real estate properties, for her share of the settlement. She testified that she preferred this arrangement due to her health problems, unfamiliarity with the bookkeeping aspects of managing real property, and the large amount of money needed to renovate run-down rental properties.

Division of marital property in dissolution cases must be equitable. Marriage of Wersland (Mont. 1991), [249 Mont. 169,] 814 P.2d 991, 994, 48 St.Rep. 626, 628. On appeal, we will not overturn the district court’s judgment distributing marital property unless the court has abused its discretion by failing to base its judgment upon substantial, credible evidence. Marriage of Dzivi (Mont. 1991), [247 Mont. 165,] 805 P.2d 567, 568, 48 St.Rep. 140.

Section 40-4-202, MCA, governs distribution of the marital estate and lists numerous factors the district court must take into account when it equitably apportions the assets between the parties. The statute also provides:

“In making apportionment, the court shall consider the duration of the marriage and prior marriage of either party; the age, health, station, occupation, amount and sources of income, vocational skills, employability, estate, liabilities, and needs of each of the parties;

Section 40-4-202, MCA(emphasis added). In relation to tax liabilities, this Court has held that “where a property distribution ordered by a court includes a taxable event precipitating a concrete and immediate tax liability, such tax liability should be considered by the court before entering its final judgment.” In re Marriage of Beck (Mont. 1981), [_ Mont._,] 631 P.2d 282, 285, 38 St.Rep. 1054, 1058.

The liquidation of stocks and bonds which form part of the marital estate in order to meet the cash payment requirements ordered by the District Court could itself be a taxable event resulting in new tax liabilities. In addition, as asserted by the husband, such a sale may adversely impact the husband’s ability to meet existing annual tax liabilities in excess of $100,000 on the various real property holdings.

In the decree of dissolution, the District Court referred to property taxes owed by the couple, but failed to make specific findings regarding tax consequences of the distribution of the marital property and did not indicate how tax liabilities were accounted for in the distribution. We hold that the District Court’s failure to address the tax consequences of the distribution of property amounted to an abuse of discretion. We therefore remand to the District Court to make an equitable distribution of the marital estate specifically considering tax consequences to both parties in making its decision. Our ruling does not require the District Court to adopt the property distribution proposed by either party.

II.

The wife contends that the District Court abused its discretion by failing to award interest on the $921,523 share of the marital estate to be paid in two annual cash installments of $460,761.50.

Whether interest is allowed on cash installments ordered in a decree of dissolution is within the discretion of the district court. In re Marriage of Garner (1989), 239 Mont. 485, 488, 781 P.2d 1125, 1127; In re Marriage of Jacobson (1979), 183 Mont. 517, 525, 600 P.2d 1183, 1188. The exception is that when a spouse is delinquent in paying cash installments ordered as part of a property settlement, the payee spouse is entitled to interest from the date the payments became due. In re Marriage of Gibson (1983), 206 Mont. 460, 466-67, 671 P.2d 629, 632-33.

In this case, the husband was required to pay two large cash payments within two years, a relatively short period of time. We hold that the District Court did not abuse its discretion by failing to award interest on the annual cash payments to the wife as part of the property settlement.

The final decree is reversed with regard to the distribution of assets and liabilities and remanded to the District Court for redetermination in accordance with this opinion.

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


author: JUSTICE TRIEWEILER

text:
    In re the MARRIAGE OF SHARON GAYLE GREENLEE, Petitioner and Appellant, and ROGER WAYNE GREENLEE, Respondent and Cross-Appellant.
    No. 91-095.
    Submitted on briefs June 27, 1991.
    Decided September 5, 1991.
    249 Mont. 521.
    816 P.2d 1073.
    Virginia A. Bryan, Wright, Tolliver & Guthals, Billings, for petitioner and appellant.

      Michael G. Moses, Moses Law Firm, Billings, for respondent and cross-appellant.
   JUSTICE TRIEWEILER

delivered the opinion of the Court.

Appellant Sharon Greenlee appeals from the judgment of the District Court of the Thirteenth Judicial District for Yellowstone County, denying her maintenance. Cross-appellant Roger Greenlee appeals the judgment regarding sale of the parties’ family home. We reverse in part and affirm in part.

The issue raised by the appellant is whether the District Court erred in its determination that she is not entitled to maintenance.

The issue raised by the cross-appellant is whether the District Court erred in not fixing a specific time and party responsible for sale of the family home.

The parties instituted dissolution of marriage proceedings in April 1989. The issues of property division, maintenance, custody, child support, and visitation were presented to the court for determination on January 3, 1990.

On October 16, 1990, judgment was entered. Joint custody of the two minor children was ordered, with respondent the primary residential custodian. The parties were ordered to sell the family home and divide the proceeds equally. They were to continue as joint owners of partnership interests in rental property. The retirement plans were divided equally between the parties and the respondent was required to buy out the appellant’s interest in his dental practice. Additional distributions of personal property were made on an equal basis. The court determined that no maintenance was necessary in light of the property distributions, appellant’s ability to earn income, and her lack of responsibility for child support payments. The appellant had sought $850 per month for maintenance.

On October 26, 1990, appellant filed a motion to amend the judgment to provide for maintenance. That motion was briefed by both parties, and an order was entered on December 7,1990, denying the motion to amend. Appellant filed this appeal on January 7,1991. Respondent filed his cross-appeal regarding disposition of the family home on January 21, 1991.

Appellant contends the District Court abused its discretion when it determined she was not entitled to maintenance. The appellant does not dispute the property division. However, she contends that the court erred in its application of § 40-4-203, MCA, the statute that pertains to maintenance. Specifically, appellant maintains that the court erred in its determination that the property which was awarded to her was sufficient to provide for her reasonable needs under subsection (l)(a) of § 40-4-203, MCA.

The court, in its Findings of Fact and Conclusions of Law, stated:

“Because of the value of the marital estate and the distribution of the assets of the marital estate, as well as the ability to earn income and relief from any child support obligations, this Court determines that maintenance is not appropriate. In light of the distributions, the Court specifically finds that Petitioner does not lack sufficient property to provide for her reasonable needs, nor is she unable to support herself through appropriate employment. The Court specifically considered the financial resources of Petitioner, including the marital property apportioned to her and her ability to meet her needs independently through appropriate employment. The Court also considered the provisions of support of the children who are living with Respondent and Petitioner being relieved of any obligation of support for the children.
“There is no plan concerning the acquisition of sufficient further education or training to enable Petitioner to find appropriate employment. The Court considered the standard of living established during the marriage, the duration of the marriage, and the age and physical and emotional condition of all the parties involved. The Court further considered the ability of Respondent under the circumstances to meet his needs as well as meeting the needs of his children in terms of providing them with support and education.”

Appellant maintains that the properties she received, including an apartment house partnership and an interest in a professional building, were income-consuming, not income-producing assets. Neither the family home nor the time shares in a Big Sky condominium produce any income. The wife’s interest in the dental practice, while income-producing, was not sufficient to provide for her needs, based upon her prior standard of living.

Appellant currently earns less than $12,000 a year from her work. She testified that her monthly expenses are approximately $3200 per month. Appellant sought $850 per month in maintenance in the dissolution proceeding.

This Court has held that in order to determine the sufficiency of the property distribution in lieu of maintenance, the district court must decide whether the property awarded is income-producing or income-consuming. In re Marriage of Goodman (1986), 222 Mont. 446, 723 P.2d 219; In re Marriage of Cole (1988), 234 Mont. 352, 763 P.2d 39.

Appellant claims that the District Court committed an abuse of discretion by failing to consider income-producing versus income-consuming qualities of the property award. We find merit in the appellant’s position. Much of the property distributed to appellant has little or no income value. The court did not or could not determine the value of either the apartment house or the professional building. It is clear from the record that both produce little or no income at this time, and that the outstanding liability upon both is substantial. The family home produces no income until a buyer is found. The Big Sky time share is not an income-producing asset, and the share of the retirement plan is not practically available to the appellant until its maturation, approximately ten years from now.

While the District Court correctly analyzed most of the criteria contained within § 40-4-203, MCA, we hold that the court did not properly consider the income-producing versus income-consuming qualities of the property awarded. Therefore, we reverse the decision of the District Court regarding maintenance and remand this case for further consideration of that issue. In doing so, the District Court should make specific findings regarding appellant’s actual living expenses, and how any property that has been distributed to her contributes to the payment of those expenses.

Based on the facts in this case, if appellant’s actual and necessary living expenses are greater than her income, and her income is not supplemented by the property she received, she is entitled to maintenance payments pursuant to § 40-4-203, MCA.

The respondent contends on cross-appeal that the lower court erred in failing to provide a specific time for the sale of the family home and a specific person responsible for the sale.

The District Court stated that:

“The family home should be sold and after costs of sale and expense, the proceeds split 50/50 between the parties. Petitioner shall continue to reside in the home pending sale and shall cooperate with the effort to sell. Respondent shall continue to make mortgage payments and receive the tax deduction for the payments.”

The family home has been listed with a Billings realtor as of April 1991. While there was some delay in the process, we conclude that both parties have begun compliance with the lower court’s order by listing the house. Both parties stand to gain financially by the sale of the home, but now need a willing buyer. No evidence has been shown that the appellant has attempted to thwart the sale of the home. We find no abuse of discretion on the part of the lower court. Therefore, we affirm the decision of the District Court regarding the sale of the family home.

Reversed in part, affirmed in part, and remanded to the District Court for further proceedings consistent with this opinion.

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