text:
    ROWLAND THROSSELL, Plaintiff and Appellant, v. BOARD OF TRUSTEES OF GALLATIN COUNTY SCHOOL DISTRICT NO. 7, BOZEMAN, Montana, Defendant and Respondent.
    No. 87-541.
    Submitted June 28, 1988.
    Decided July 12, 1988.
    757 P.2d 348.
    Gregory O. Morgan argued, Bozeman, for plaintiff and appellant. Donald E. White argued, Bozeman, for defendant and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

Appellant Throssell appeals from the summary judgment of the District Court, Eighteenth Judicial District, Gallatin County, in which the court dismissed Throssell’s complaint for failure to exhaust his administrative remedies. We vacate the District Court’s order and remand the cause to the Gallatin County Superintendent of Schools with instructions.

In 1976, Throssell was hired as an administrator and vice-principal for Senior High School of District No. 7 in Gallatin County. He continued to be rehired through a series of one-year contracts until 1983. In May, 1983, Throssell told the school that he planned to retire after the 1983-84 school year and he requested that his retirement stipend be added into his contract for his last year. His contract allowed him $250 for each year of his 8 years of district service. He was hired for that year as an assistant principal at Bozeman Jr. High.

In April, 1984, the school district adopted a new retirement plan which encouraged teachers to retire early. This “voluntary career option plan” provided that teachers with 13 or more years of “district credited service” were entitled to lump-sum payments at retirement.

Throssell claimed his contract entitled him to benefits under this plan but upon hearing in January, 1985, the District Board of Trustees denied his claim because he was an administrator and by definition excluded from the plan. The Board also determined that he had not acquired a sufficient number of years of district credited service to be eligible. Throssell appealed this decision to the Gallatin County Superintendent of Schools who, upon motion by Throssell, determined that she did not have jurisdiction to hear the matter because it was a claim for breach of contract and not a controversy intended to be heard under Section 20-3-210, MCA. She granted Throssell’s motion and “denied” the appeal. This decision was not appealed to the State Superintendent of Public Instruction by either party.

Throssell then filed a complaint in the District Court on October 22, 1985. On November 13, 1985, the School District made a motion to dismiss the claim for failure to exhaust administrative remedies. Both parties briefed the motion and additional briefs were ordered August 26, 1986. Upon suggestion by the School District, the court viewed the School District motion as one for summary judgment and granted it on November 3, 1987. Throssell appeals from this judgment.

Among the seven issues Throssell specifies on appeal is whether the County Superintendent properly denied jurisdiction over the controversy. Because we hold that the County Superintendent had jurisdiction and therefore the District Court had no jurisdiction to hear this cause of action, we will not address the remaining six issues.

Throssell contends that Section 20-3-210, MCA, which grants the County Superintendent the power to hear school controversies was correctly limited by the County Superintendent’s decision to abandon jurisdiction over a cause of action based upon a breach of contract. He argues that pursuant to this Court’s decision in McBride v. School District, No. 2 (1930), 88 Mont. 110, 290 P. 252, actions for money owed pursuant to a contract are not contemplated within the meaning of Section 20-3-210, MCA. We disagree.

Section 20-3-210, MCA, states in pertinent part:

“Controversy appeals and hearings. (1) Except as provided under 20-3-211, the county superintendent shall hear and decide all matters of controversy arising in his county as a result of decisions of the trustees of a district in the county.”

The Gallatin County Superintendent agreed with appellant that there was no difference between the instant case and one which involved a breach of contract with an outside supplier. Both involved the seeking of a money judgment. As support for his position, Throssell cites to McBride in which a teacher brought an action against the school district for one month’s salary following the district’s rejection of the teacher’s reapplication for employment. This Court held that because the action was for a money judgment for breach of contract the rule of exhausting one’s administrative remedies did not apply. McBride, 290 P. at 254. A search of subsequent case law shows that since the Montana Administrative Procedures Act became applicable to school controversies in 1977, this Court has allowed few exceptions to the rule that a claimant in the school system must exhaust his or her administrative remedies. These exceptions include where state agencies have been directly granted primary jurisdiction resulting in decisions outside the administrative exhaustion doctrine, Johnson v. Bozeman School Dist. No. 7 (Mont. 1987), [226 Mont. 134,] 734 P.2d 209, 44 St.Rep. 531, and where the matter is governed by a specific statute. See, e.g., Jarussi v. Board of Trustees of School Dist. No. 28 (1983), 204 Mont. 131, 664 P.2d 316. An older exception exists where the Board has acted without or in excess of its jurisdiction. Peterson v. School Board, District No. 1 (1925), 73 Mont. 442, 236 P. 670. Recent case law shows that even when a money judgment is requested the administrative appeals process has been followed. See, Yanzick v. School District No. 23, Lake County (1982), 196 Mont. 375, 641 P.2d 431 (tenured teacher sought reinstatement and back pay); Pryor School District Nos. 2 & 3 v. Superintendent of Public Instruction (Mont. 1985), [218 Mont. 73,] 707 P.2d 1094, 42 St.Rep. 1405 (unlawfully discharged principal awarded one year’s pay); Harris v. Bauer (Mont. 1988), [230 Mont. 207,] 749 P.2d. 1068, 45 St.Rep. 147 (school psychologist awarded tenure and back pay with interest). These cases illustrate that the seeking of a money judgment is not the dispositive factor in determining the educational agency’s jurisdiction over a matter.

Throssell is a retired school administrator with a claim that his contract with the school district entitles him to the identical retirement benefits afforded teachers through the new school district retirement plan. This is distinguishable from an action by an outside supplier on a contract with the school district and this is a “controversy arising ... as a result of decisions of the trustees of a district . . .” fully contemplated within the meaning of Section 20-3-210, MCA. Therefore the County Superintendent improperly abandoned jurisdiction over the matter. The District Court, then, had no jurisdiction to hear the case. Accordingly, we vacate the District Court’s Order granting defendant’s motions to dismiss and for summary judgment and remand this matter to the Gallatin County Superin7 tendent for hearing and for the entering of findings of fact and conclusions of law.

Vacated and remanded.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON, WEBER, SHEEHY, GULBRANDSON and McDONOUGH concur.


source: Caselaw Access Project

author:
MR. JUSTICE HUNT
      MR. JUSTICE GULBRANDSON,

license: Public Domain

text:
    TRUSTEES, MISSOULA COUNTY SCHOOL DISTRICT NO. 1, Petitioner and Respondent, v. CAROL ANDERSON, Mike Bowman, Missoula County Superintendent of Schools; and Ed Argenbright, Superintendent of Public Instruction, Respondents and Appellants.
    No. 87-568.
    Submitted on Briefs May 26, 1988.
    Decided July 13, 1988.
    757 P.2d 1315.
    Emilie Loring, Big Fork, for respondents and appellants.
    Robert L. Deschamps, Co. Atty., Missoula, and Rick Bartos, Office of Public Instruction, Helena, for petitioner and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

In an administrative proceeding, the State Superintendent of Public Instruction concluded that the Missoula County Superintendent of Schools properly found that the petitioners, Board of Trustees for the Missoula County School District No. 1, failed to carry its burden of proof that respondent Carol Anderson was incompetent to teach in the classroom in the Missoula county schools. The District Court of the Fourth Judicial District, Missoula County, reversed the decision of the State Superintendent of Public Instruction. The respondent, Anderson, appeals. We reverse.

The sole issue presented to this Court for review is whether the District Court abused its discretion in substituting its judgment for that of the State Superintendent of Public Instruction?

Respondent Carol Anderson holds a Montana elementary teaching certificate with special education and elementary curriculum endorsements. She was a tenured teacher employed by the Missoula school district from 1970 to 1983. During those thirteen years, Anderson taught, along with two other teachers, special education in a self-contained team teaching environment. Throughout Anderson’s thirteen years of teaching, seven separate administrators gave her satisfactory evaluations for her teaching performance in the classroom. The evaluations indicated that she performed ably and well above a minimum sufficiency level.

Anderson requested and was granted an unpaid leave of absence for the 1983-84 school year. During that year, enrollment declined in the special education, self-contained program and the administrators determined that two teachers were sufficient to handle the program. In the spring of 1984, Anderson accepted a contract from the Board of Trustees for the Missoula County School District No. 1 (Board of Trustees) for the 1984-85 school year. As a consequence of her previous position being eliminated, the administrators had planned to transfer Anderson to some other teaching position available within the district.

The Board of Trustees adopted a written policy in 1983 requiring teachers seeking positions with the district or teachers requesting a voluntary transfer within the district to participate in a structured interview for available teaching positions. These interviews are a series of questions prepared by those responsible for the program. Each question has an anticipated response drawn from the Board of Trustees’ policy and curriculum. Anderson, an involuntary transferee, participated in four structured interviews during the summer of 1984 and did not perform well in any of the four interviews.

Based upon the four structured interviews and the subsequent recommendation of the school administrators, the Board of Trustees dismissed Anderson on September 10, 1984 for incompetence. When making this determination of incompetency, the Board of Trustees apparently did not consider Anderson’s satisfactory classroom performance. As a result of this finding, the Board did not place Anderson in any of the teaching positions available in the district.

Anderson sought administrative review of the Board of Trustees’ action. Pursuant to Montana Administrative Procedure Act (MAPA), Sections 2-4-101 to -711, MCA, the Missoula County Superintendent of Schools held a hearing and concluded that the Board of Trustees did not meet their burden of proof that Anderson was incompetent to teach in the Missoula county schools. In making this conclusion of law, the County Superintendent of Schools noted that the Board of Trustees relied solely on Anderson’s four structured interviews and apparently did not consider Anderson’s thirteen years of classroom teaching and the satisfactory evaluations she received from the principals who observed her ability to perform in the classroom. The State Superintendent of Public Instruction affirmed the County Superintendent’s conclusions. The Board of Trustees sought review from the Fourth Judicial District Court, Missoula County, which reversed the State Superintendent’s decision, finding that the Board of Trustees met their burden of proof that Anderson was incompetent to teach in one of the available teaching positions in the district.

The sole issue Anderson raises on appeal is whether the District Court abused its discretion in substituting its judgment for that of the State Superintendent of Public Instruction?

When confronted with reviewing an administrative decision, as in the present case, this Court recognizes that a rebuttable presumption exists in favor of the agency’s decision and that the burden of proof is on the party attacking it to show that it is erroneous. Thornton v. Commissioner of Dept. of Labor and Industry (Mont. 1980), [190 Mont. 442,] 621 P.2d 1062, 1064-65, 37 St.Rep. 2026, 2028. This Court also recognizes that judicial review of an administrative decision is limited in nature. When reviewing an agency’s findings of fact, a reviewing court must affirm the findings unless they are clearly erroneous. If the findings of fact are supported by reliable and substantial evidence, the reviewing court may not reweigh the evidence. The scope of review for an agency’s conclusion of law, however, is broader. An agency’s conclusion may be reversed if it represents an abuse of discretion. Steffen v. Dept. of State Lands (Mont. 1986), [223 Mont. 176,] 724 P.2d 713, 715, 43 St.Rep. 1636, 1638.

The District Court determined that the Board of Trustees overcame the presumption that Anderson is competent to teach in the classroom. The District Court failed to apply the standard of review outlined above when reviewing the decision of the State Superintendent of Public Instruction. The court erroneously states that “the issue in this case is how much evidence is needed to demonstrate teacher incompetence.” The actual issue before the District Court, however, was whether the administrative agency, the State Superintendent of Public Instruction, abused its discretion in its conclusion of law or whether the findings of facts were clearly erroneous. Upon review of the record, we hold that the District Court erroneously substituted its judgment for that of the State Superintendent of Public Instruction.

The record clearly indicates that substantial evidence exists to support the findings of fact. For example, substantial evidence exists to support the State Superintendent’s findings that Anderson was employed by the Missoula County School District No. 1 for thirteen years; that she held a tenured position; that she received satisfactory evaluations for her thirteen years of classroom teaching; that she participated in four structured interviews during the summer of 1984 to determine what teaching position she qualified for and that she performed poorly in all four interviews; and that as a result solely of the four structured interviews and the subsequent recommendation of the school administrators, the Board of Trustees dismissed Anderson for incompetence on September 10, 1984. These findings of fact are supported by substantial evidence and are not clearly erroneous.

Based upon the findings of fact, the State Superintendent of Public Instruction entered his conclusions of law. In pertinent part, the State Superintendent concluded that the Board of Trustees may dismiss a teacher before the expiration of her employment contract for incompetence pursuant to Section 20-4-207, MCA; incompetence consists of the inability to perform ably and above a minimum level of sufficiency as determined by law within a classroom; the results of the structured interviews are relevant and material to the issue of competence and placement; the results of the structured interviews are not sufficient in themselves to meet the burden of proof to dismiss a tenured teacher for incompetence; and that the Board of Trustees should have considered Anderson’s thirteen years of satisfactory classroom evaluations. The State Superintendent of Public Instruction then ordered that Anderson should be reinstated as a teacher in the Missoula County School District No. 1.

The State Superintendent of Public Schools did not abuse his discretion in determining the conclusions of law or in reinstating Anderson as a teacher in the Missoula county schools. As the State Superintendent noted; this case involves a careful balancing of Anderson’s protected rights of tenure and the Board of Trustees’ right to maintain the integrity of the schools. This Court has repeatedly recognized that a teacher’s tenure is a substantial, valuable, and beneficial right which cannot be taken away except for good cause. Yanzick v. School District No. 23, Lake County (1982), 196 Mont. 375, 391, 641 P.2d 431, 440; State ex rel. Saxtorph v. District Court, Fergus County (1954), 128 Mont. 353, 361, 275 P.2d 209, 214. Incompetency qualifies as a good cause to take away a teacher’s tenure, however, past decisions have indicated that a teacher’s performance should be assessed in a classroom atmosphere. See Yanzick, 196 Mont. at 392, 641 P.2d at 441. The relevancy of the structured interviews are not questioned, however, they cannot be the sole determination of a teacher’s level of competency when classroom experience and other valid means are also available for assessment.

When a tenured position is at stake, the teacher must have the benefit of having all the available evidence properly considered and weighed. The County Superintendent of Schools considered and weighed all the evidence, and determined that in light of Anderson’s thirteen years of classroom experience, the Board of Trustees, by relying solely on the four structured interviews, failed to prove by a preponderance of evidence that Anderson was incompetent to teach in the Missoula county schools. The County Superintendent and the State Superintendent did not abuse their discretion in reinstating Anderson and allowing her classroom performance to be considered in determining her level of competency as a teacher. As a result, we hold that the District Court abused its discretion in substituting its judgment for that of the State Superintendent of Public Schools.

We reverse the District Court and reinstate the decision of the State Superintendent of Public Instruction and the Missoula County Superintendent of Schools.

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

MR. JUSTICE GULBRANDSON,

specially concurring in the result:

I reluctantly agree with the result expressed in the foregoing Opinion.


author: MR. JUSTICE GULBRANDSON

text:
    TERRY PIPINICH, Plaintiff and Appellant, v. TOM BATTERSHELL, Defendant and Respondent.
    No. 87-493.
    Submitted June 15, 1988.
    Decided July 14, 1988.
    759 P.2d 148.

      John C. Doubek argued, Small, Hatch, Doubek & Pyfer, Helena, for plaintiff and appellant.
    Ronald F. Waterman argued, Gough, Shanahan, Johnson & Waterman, Helena, for defendant and respondent.
   MR. JUSTICE GULBRANDSON

delivered the Opinion of the Court.

This is an appeal from a judgment of the First Judicial District Court, Lewis and Clark County, granting defendant/respondent Tom Battershell’s (Battershell) summary judgment motion against plaintiff/appellant, Terry Pipinich (Pipinich) on a complaint and counterclaim and dismissing the action initially filed by Pipinich based on allegations of fraud. The counterclaim is not at issue in this case. Pipinich’s appeal is based on the summary judgment ruling dismissing the complaint. We affirm.

The rephrased issue presented to this Court is:

Whether the District Court erred in granting summary judgment to Battershell.

The case centralizes around a claim by Pipinich that Battershell misrepresented the worth of the two individual’s construction company, Sunrise Construction Company, Inc. (Sunrise), when Pipinich sold his share to Battershell.

Sunrise was originally formed in 1979 by Pipinich and Gary Duval (Duval), after the two had previously worked together at Reber Construction Company. Duval sold his interest to Battershell and Battershell and Pipinich each held a 50% share of the business. Pipinich was in charge of the field construction projects and Batter-shell handled the books, mail and bank accounts for the business. Battershell also was involved on a Sunrise project in Butte.

The Butte project, which actually involved Sunrise as a subcontractor of A.D. McKee Construction on a series of three construction contracts, is central to this case. The first contract had been awarded prior to the time Pipinich sold his share in Sunrise to Battershell and construction work had commenced on the project. Pipinich had actually been involved in the bid proposal on this project. The record indicates that the other two projects had not been let for bid at the time Pipinich sold out.

Sometime in April of 1981, Battershell and Pipinich concluded they could no longer work together and one party would have to buy the other’s interest. Pipinich claims the breakup occurred because he went through the mail to obtain two subcontractor bids to compile a bid package on a project. He claims this gave Battershell an excuse to force him out of the company.

At any rate, a severing of the relationship occurred. Pipinich agreed to sell his interest for approximately $250,000 in cash and assets along with relief from debt Pipinich owed Sunrise. Battershell allegedly told Pipinich that his share was worth no more than $200,000. There is also evidence that Pipinich originally wanted $300,000. Pipinich consulted with Sunrise’s accountant, William Holmlund, but did not attempt to ascertain the company’s actual worth other than relying on what Battershell told him.

The Sunrise tax return balance sheet for fiscal year 1981 was not completed at the time of the buy out. The balance sheet was later completed and shows the fiscal year for the company ended on March 31, 1981. At that time Sunrise showed total assets of $1,144,905. This same balance sheet showed liabilities in the amount of $925,323.

In November of 1985 Pipinich alleges he was told by an attorney from Butte working on another case which involved Battershell that the company was allegedly worth in excess of $1 million when Pipinich sold out. Based on this information Pipinich consulted counsel in this case who did further “investigation”. Pipinich filed a complaint on July 11, 1986.

Pipinich claims Battershell allegedly misrepresented the value of the company so as to capitalize on the transaction. The complaint alleged Pipinich was directly and proximately damaged by the false, fraudulent, reckless, deceitful, willful and unlawful acts and omissions of Battershell. Battershell filed an answer and counterclaim on September 4, 1986 requesting Pipinich be found liable on promissory note debt obligations totaling $38,500.30 plus interest.

On July 6, 1987, Battershell filed motions for summary judgment on the complaint and counterclaim. On September 30, 1987, the court orally granted Battershell’s motions for summary judgment. A memorandum and order, along with a judgment, granting Batter-shell summary judgment and dismissing the complaint was filed October 19, 1987. This same order awarded Battershell $51,330.58 on the counterclaim after Pipinich admitted owing on the promissory notes. Pipinich does not appeal this aspect of the order. In granting summary judgment, the District Court adopted Battershell’s proposed order verbatim.

Pipinich claims the District Court’s order ignored the common law tort theory of actual fraud and the verbatim adoption was erroneous. Citing, Sawyer-Adecor International, Inc. v. Anglin, et al (1982), 198 Mont. 440, 646 P.2d 1194. This Court stated that it “disapprove [s], heartily and stoutly, the verbatim adoption of proposed findings and conclusions.” Sawyer-Adecor, 646 P.2d at 1198. However, Montana law allows verbatim adoption of findings and conclusions where they are comprehensive and detailed, supported by the evidence before the court, and are not clearly erroneous. Olsen v. McQueary (Mont. 1984), [212 Mont. 173,] 687 P.2d 712, 715, 41 St.Rep. 1669; R.L.S. v. Barkhoff (1983), 207 Mont. 199, 674 P.2d 1082, 1085. Upon review of the record in this case and the findings and conclusions, we hold that the District Court did not err in adopting Battershell’s proposed order where the court had previously orally granted his motions for summary judgment.

Immediately prior to the hearing on the motion for summary judgment, Pipinich filed a “supplemental legal memorandum” in which he raised issues of breach of a fiduciary duty of a partner and bad faith on the part of Battershell. These two theories are also advanced by Pipinich on this appeal.

We note initially that the business entity involved in this case was not a partnership but a corporation. Therefore, Pipinich’s reliance on a partner’s breach of a fiduciary relationship creating a claim for bad faith is misplaced. A partnership and corporation are two separate legal entities under the law. Sections 35-1-101 et seq. and 35-10-101 et seq., MCA.

We note additionally that Pipinich failed to allege fraud with particularity pursuant to Rule 9(b), M.R.Civ.P. An action for actual fraud requires that a number of elements must be averred and satisfied to establish a prima facie case. These elements are: (1) a representation; (2) its falsity; (3) its materiality; (4) the speaker’s knowledge of its falsity or ignorance of its truth; (5) the speaker’s intent that it should be relied on; (6) the hearer’s ignorance of falsity of the representation; (7) the hearer must rely on the representation; (8) the hearer’s right to rely on the representation; and (9) consequent and proximate injury caused by reliance on the representation. First National Bank in Havre v. Nelson (Mont. 1987), [228 Mont. 146,] 741 P.2d 420, 421, 44 St.Rep. 1411; Krone v. McCann (1982), 197 Mont. 380, 387, 642 P.2d 584, 587-588.

Further, in answers to interrogatories specifically requesting facts supporting his allegations of fraud, Pipinich referred Batter-shell back to the allegations of the complaint. Rule 33, M.R.Civ.P., allowing interrogatories as a discovery tool, has the purpose of promoting the ascertainment of truth and ultimate disposition of lawsuits by assuring mutual knowledge of all relevant facts gathered by both parties. Massaro v. Dunham (1979), 184 Mont. 400, 603 P.2d 249. As argued by Battershell, interrogatories allow for the just, speedy and inexpensive determination of actions and assure judgment is rendered on the facts as they actually exist. Wolfe v. Northern Pacific Railway Co. (1966), 147 Mont. 29, 409 P.2d 528. Mere reference back to complaint allegations is insufficient to answer an interrogatory. Unresponsive, incomplete and evasive answers, such as those presented by Pipinich in this case, should be dealt with in an expeditious manner by the District Court even if it requires dismissal of a suit.

The standard of review on summary judgment has been made clear by this Court:

“On review, we will uphold the summary judgment if there is no genuine issue of material fact and the evidence shows the moving party is entitled to judgment as a matter of law. Sevalstad v. Glaus (Mont. 1987), [227 Mont. 117,] 737 P.2d 1147, 1148, 44 St.Rep. 930, 932 .. .
“When the movant has met this initial burden, the party opposing the motion must supply evidence supporting the existence of a genuine issue of fact. [Citation omitted.] Rule 56(c), M.R.Civ.P.”

Vogele v. Estate of Schock (Mont. 1987), [229 Mont. 259,] 745 P.2d 1138, 1141, 44 St.Rep. 1950, 1953.

Pipinich contends that “unless the moving party initially presents admissible evidence that a material question of fact does not exist, the non-movant has no duty to come forward with counter-proof.” Citing, Mathews v. Glacier General Assurance Company (1979), 184 Mont. 368, 603 P.2d 232. Here, Battershell came forward with admissible evidence that no material question of fact exists. Pipinich has not met his counter-proof burden.

Rule 56(c), M.R.Civ.P., states the judgment should be rendered “if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Here, depositions were taken of both Battershell and Pipinich. An affidavit of Holmlund was also presented. Interrogatories, although not initially complied with on the part of Pipinich, were tendered and answered by the parties. Despite no specific date for closure of discovery, pursuant to Rule 16(b), M.R.Civ.P., sufficient evidence was present for the court to rule on the summary judgment motion.

Battershell’s brief in support of the motion for summary judgment, filed on July 6, 1987, is compelling in this case. In the brief, Batter-shell cites to Pipinich’s deposition:

“Q. [D]id you have any documents at the time that you filed that Complaint?
“A. Not in my possession.
“Q. In whose possession were those documents?
“A. [Plaintiffs counsel] showed me a document. It was in a insurance — I don’t know what it was, but it was an insurance questionnaire.”

Pipinich asserts the insurance questionnaire, signed by Battershell, is significant because it lists the value of Sunrise at $6,000,000. A copy of the questionnaire is attached to Pipinich’s brief in opposition to the motion for summary judgment. It does indeed list the approximate value of the business at $6,000,000 but the date of the application is March 29, 1982, nearly a year after the transaction between Pipinich and Battershell. A document filled out a year after the transaction, without more, clearly does not create a material issue of fact. Upon further questioning at the deposition, Pipinich was asked if he had any other documents supporting his claim and he replied unequivocally: “no”.

Pipinich was also questioned concerning his conversations with the Butte attorney who allegedly informed Pipinich that Sunrise was worth in excess of $1,000,000. Testimony was presented as follows:

“Q. Did he show you any documents to support his contention that at the time you sold out, the company was worth in excess of $1 million?
“A. No.
“Q. Since then have you seen any documents that support that lawyer’s contention that when you sold out, the company was worth in excess of $1 million?
“A. None, other than the one I mentioned earlier.
“Q. Which one was that?
“A. The insurance.
“Q. The insurance questionnaire?
“A. Right.”

Further questioning of Pipinich showed no additional investigation, other than contacting his own attorney, was undertaken to ascertain the facts upon which the attorney from Butte based his statement. Upon further investigation by Pipinich’s attorney, no documents were found to support the allegations of fraud.

Finally, Pipinich was questioned as to the facts he possessed which supported the complaint:

“Q. At the time the Complaint was filed, could you tell me what facts you believed existed to support your contention that Mr. Battershell defrauded you?
“A. I never had any facts.
“Q. At the time the complaint was filed, you had absolutely no facts.
“A. No.
“Q. Since the Complaint has been filed until the date of your deposition today, have you gathered any other facts or been shown any other facts that support your contention that Mr. Battershell defrauded you?
“A. Not facts.
“Q. No facts. By that, I take that there has been something told to you other than facts at the present time?
“A. I can’t say that they weren’t facts. Evidently I believe they were.”

Nothing of substance to support Pipinich’s claim was stated at this deposition. Attached to Pipinich’s brief in opposition to Batter-shell’s motion for summary judgment was the balance sheet attached to tax returns for Sunrise for fiscal year 1981. It is suggested by Battershell, and highly probable, that the Butte attorney who informed Pipinich that the value of the company in 1981 was over $1 million was referring to the fact that Sunrise listed assets in excess of $1 million. However, if the liabilities of the company are subtracted from this amount, the offer made by Battershell actually exceeded the value of Pipinich’s equity.

Upon the above depositional testimony and a consideration of the tax return balance sheet, the District Court could adduce that no facts existed to satisfy the first requisite of a fraud claim — that there was a material misrepresentation.

The failure of Pipinich to show a misrepresentation on the part of Battershell also bars any claim of constructive fraud in this case. No failure of a duty to disclose has been shown by the facts presented and there was no fiduciary relationship between Batter-shell and Pipinich in this case. Pipinich cites to Alexander v. Texaco, Inc. (D.C. Mont. 1981), 530 F.Supp. 864 and Purcell v. Automatic Gas Distributors, Inc. (1983), 207 Mont. 223, 673 P.2d 1246, to support his constructive fraud argument but both cases are inapplicable. In Alexander, supra, the federal district court found Texaco liable for failing to disclose its intention to leave Montana. In Purcell, supra, a gas distributor breached a fiduciary duty.

Here, from the above stated evidence, Battershell’s burden of showing no genuine issue of material fact was met. In order to prevent summary judgment, Pipinich must produce evidence sufficient to raise a genuine issue of fact. Spadaro v. Midland Claims Service, Inc. (Mont. 1987), [227 Mont. 445,] 740 P.2d 1105, 1108, 44 St.Rep. 1221; Kaiser v. Town of Whitehall (Mont. 1986), [221 Mont. 322,] 718 P.2d 1341, 1342, 43 St.Rep. 846. Pipinich failed to meet his burden of showing a genuine issue of material fact.

We held that claimants cannot rest on the mere allegations of the complaint in satisfying the burden required to resist a motion for summary judgment once the moving party has met its burden. See generally, Conboy v. State (Mont. 1985), [214 Mont. 492,] 693 P.2d 547, 42 St.Rep. 120. In Conboy, supra, we stated:

“Failure of the party opposing the motion to either raise or demonstrate the existence of a genuine issue of material fact, or to demonstrate that the legal issue should not be determined in favor of the movant, is evidence that the party’s burden was not carried. Summary judgment is then proper, the court being under no duty to anticipate proof to establish a material and substantial issue of fact.” Conboy, 693 P.2d at 551.

The District Court properly determined that no genuine issue of material fact was presented by the plaintiff. We affirm.

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


author: MR. JUSTICE HARRISON

text:
    WALTER H. PESCHEL, Plaintiff and Appellant, v. WILLIAM EVAN JONES, Defendant and Respondent.
    No. 88-58.
    Submitted on Briefs May 26, 1988.
    Decided July 14, 1988.
    760 P.2d 51.

      Martin J. Elison, Larry M. Elison, Missoula, William J. Powell, Spokane, Wash., for plaintiff and appellant.
    William L. Crowley, Boone, Karlberg & Haddon, Missoula, for defendant and respondent.
   MR. JUSTICE HARRISON

delivered the Opinion of the Court.

Plaintiff/appellant, Walter H. Peschel, appeals a summary judgment granted in favor of defendant/respondent, William Evan Jones. Summary judgment was granted on two separate dates, December 11, 1986 and December 8, 1987, in the Fourth Judicial District, Missoula County. We affirm.

In October of 1978, Walter Peschel (Peschel) was involved in the development and construction of an apartment complex which was to be known as the “Mountain Wood Apartments.” Peschel was the sole general partner of a limited partnership. In June, 1978, Peschel entered an oral agreement, known as the MacDonald Agreement, with Charles Isaly (Isaly) for the construction of the complex. Isaly represented the construction contractor, Martin Development Company (Martin Development).

The principal lender was the Washington Mortgage Company (Washington Mortgage), the loan was guaranteed by the Department of Housing and Urban Development (HUD), and the parties entered a HUD form construction contract June 6, 1978. The loan amount obtained from Washington Mortgage did not include the total amount needed for construction. Peschel desired to construct a complex of a quality which would cost more than the guarantee obtained from HUD. Peschel intended to personally finance the amounts above that provided in the principal loan.

Construction of the complex began in July, 1978 and financing problems developed shortly thereafter. Peschel later hired defendant, William Evan Jones (Jones) an attorney at law, to assist in negotiations regarding the financing difficulties. On October 2, 1979, Washington Mortgage notified Peschel that he had defaulted on his loan and that the loan was going to be assigned to HUD. On November 10, 1979, Peschel and the contractor Martin Development entered into a written agreement, entitled Addenda No. 1. The agreement was signed by these two parties only and was an attempt to cure the financing problems so as to allow construction to continue. The Addenda agreement released and discharged both parties from all disputes existing between them on that date. Work resumed on the project'into December, 1979. However, when Martin Development prepared construction loan requisition No. 13 (Draw No. 13), Washington Mortgage refused to pay the disbursement because it intended to reassign the construction loan to HUD. As a result, no further construction loan draws would be authorized and disbursed until HUD accepted the assignment and approved the draws. Many subcontractor bills were not paid on time and construction ceased.

Peschel filed a “complaint for damages for professional negligence” against Jones on November 14,1985. The complaint alleged that the agreement negotiated by Jones, Addenda No. 1, was inadequate and proximately caused damages totaling $1,095,740 for increased construction costs, monies which could not be refunded from escrow, legal fees, accounting fees, rent impoundment charges, and an interest rate increase incurred when forced to refinance the project. Peschel alleged Addenda No. 1 was defective because, inter alia, it failed to obtain consent from HUD, the contractor’s bonding company, and Washington Mortgage. Additionally, the complaint alleged various other defects including: Jones failed to negotiate a resolution as to the current defaults with Washington Mortgage, failed to advise Peschel that construction would cease unless additional parties consented, released the contractor Martin Development from all claims, and incorrectly advised Peschel of liability limitations.

The District Court granted a partial summary judgment in favor of defendant Jones December 11, 1986, based on a theory of collateral estoppel. The District Court granted summary judgment for Jones as to the remainder of the complaint December 8,1987, holding that the statute of limitations prohibited the remaining issues from going forward.

Peschel raises two issues on appeal:

1. Did the District Court correctly determine that defendant was entitled to partial summary judgment based on collateral estoppel?

2. Did the statute of limitations prohibit plaintiff from his cause of action?

1. Collateral Estoppel.

The facts surrounding this case are somewhat involved and have spawned a significant amount of litigation. In Martin Development Co. v. Keeney Construction Co. (Mont. 1985), [216 Mont. 212,] 703 P.2d 143, 42 St.Rep. 752, we affirmed a District Court award of $40,000 to Martin Development for lost profits and against Peschel. We also held that the Addenda represented the entire agreement of the parties and reversed an award of attorney’s fees and an award of interest based on lost profits. Martin Development Co., 703 P.2d at 148, 42 St.Rep. at 758. In the present case, plaintiff Peschel is bound by the facts and law as established by this prior case.

Defendant Jones entered a motion for summary judgment on November 10, 1986. Jones alleged that portions of the acts or omissions alleged by Peschel to constitute legal malpractice had been effectively determined by prior litigation and that Jones was entitled to summary judgment as to those acts or omissions according to the theory of collateral estoppel. The District Court granted partial summary judgment December 11, 1986, and denied a motion by plaintiff Peschel to alter or amend the partial summary judgment February 9, 1987. The District Court also issued two orders clarifying the extent of the partial summary judgment on June 5, 1987 and August 12, 1987.

Simply stated, Peschel’s claim is that Jones produced a defective document and offered Peschel defective legal advice when he presented Addenda No. 1 to Peschel and advised him to sign it. More specifically, Peschel listed the following twelve acts or omissions in his complaint labeled a. through 1. of paragraph V:

“a. Defendant failed to procure the consent of HUD to ‘Addenda No. 1,’ agreement between Plaintiff and the contractor.
“b. Defendant failed to obtain the consent of the contractor’s bonding company to ‘Addenda No. 1.’
“c. Defendant failed to obtain the consent of Washington Mortgage Company to “Addenda No. 1’ or to attempt to negotiate resolution of current defaults with that firm.
“d. Defendant advised Plaintiff that the consent of the foregoing parties was not necessary for ‘Addenda No. 1’ to be effective and for the project to continue.
“e. Defendant drafted and advised Plaintiff to agree to paragraph 11 of ‘Addenda No. 1,’ which released and discharged the contractor from all claims.
“f. Defendant failed to obtain commitment from HUD to release draw No. 13 in conjunction with carrying out ‘Addenda No. 1.’
“g. Defendant advised Plaintiff that commitment of HUD to release Draw No. 13 was not necessary.
“h. Defendant failed to obtain written agreement from the contractor’s bonding company to guarantee completion of the project.
“i. Defendant advised Plaintiff that such commitment from the bonding company was not necessary and that the bonding company would still be liable.
“j. Defendant failed to include in ‘Addenda No. 1’ and failed to attempt to negotiate provisions in said agreement requiring the contractor to produce lien waivers each month so that progress disbursements would not be held up.
“k. Defendant advised Plaintiff that his liability under paragraph 13 of ‘Addenda No. 1’ was limited to the $50,000.00 and $15,000.00 mentioned in paragraphs 2(a) and 2(d).
“1. Defendant advised Plaintiff not to accept a proposal subsequently made by the bonding company to construct a third building and thereafter litigate certain issues then pending.”

By way of its order granting partial summary judgment, the order denying Peschel’s motion to alter or amend, and the two orders of clarification, the District Court granted summary judgment based on the doctrine of collateral estoppel as to issues (a), (b), (d), (f), (g), (h), (i), (j), and the portion of (c) referring to the failure to obtain the consent of Washington Mortgage to Addenda No. 1 (the remainder of Subsection (c) was held to still be at issue).

In the initial order, the District Court stated Peschel was bound by the facts and law as established in Martin Development Co. v. Keeney Construction Co. (Mont. 1985), [216 Mont. 212,] 703 P.2d 143, 42 St.Rep. 752, and the District Court litigation preceding that appeal. The District Court framed Peschel’s issue by stating:

“[P]laintiff is not contesting whether or not [he] is bound under the doctrine of collateral estoppel by those facts and matters found to be established in the District Court action and the Supreme Court action. Rather, Plaintiff’s position was that such established facts and matters, while binding on Plaintiff in this action, were not dispositive of the specific issues raised between Plaintiff and Defendant as framed and defined by the pleadings and contentions of the parties.”

This is the crux of Peschel’s argument on appeal. While Peschel does not challenge the fact that he is bound by the facts and law as established in the prior litigation, he does contend that the prior litigation did not determine those issues he now raises and were determined to be without merit by the District Court according to collateral estoppel.

A party is entitled to summary judgment if the totality of the record shows “that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Rule 56(c), M.R.Civ.P. The purpose of summary judgment is to promote judicial economy by eliminating unnecessary trials. Still, the motion should be granted only when there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. The initial burden of demonstrating the absence of any genuine issue regarding any material fact lies with the moving party. See, e.g. Rumph v. Dale Edwards, Inc. (1979), 183 Mont. 359, 600 P.2d 163. If the moving party is successful, the burden of proof shifts to the non-moving party to demonstrate the presence of a genuine issue as to some material fact. See, Rumph, supra; and DeWinter v. Capp Homes, Inc. (1973), 162 Mont. 19, 507 P.2d 1061. “All reasonable inferences that may be drawn from the offered proof are to be drawn in favor of the party opposing the summary judgment.” Cereck v. Albertson’s, Inc. (1981), 195 Mont. 409, 411, 637 P.2d 509, 511.

“Collateral estoppel or issue preclusion refers to the situation where an issue has been previously litigated by a party in a former case and that party is estopped from re-litigating it in a subsequent case.” In Re Marriage of Stout (Mont. 1985), [216 Mont. 342,] 701 P.2d 729, 733, 42 St.Rep. 856, 860, 861. Collateral estoppel is distinct from res judicata, or claim preclusion, which prohibits the litigation of a claim previously litigated and decided. Collateral estoppel refers to a preclusion of issues, as opposed to a claim. We have established a three-part inquiry to determine whether collateral estoppel applies to a given case:

1. Was the issue decided in the prior adjudication identical with the one presented in the action in question?

2. Was there a final judgment on the merits?

3. Was the party against whom the plea is asserted a party or in privity with a party to the prior adjudication?

Aetna Life Ins. Co. v. McElvain (Mont. 1986), [221 Mont. 138,] 717 P.2d 1081, 1086, 43 St.Rep. 697, 703 (quoting, In Re Marriage of Stout (Mont. 1985), [216 Mont. 342,] 701 P.2d 729, 733-734, 42 St.Rep. 856-861, and Aetna Life and Cas. Ins. Co. v. Johnson (Mont. 1984), [207 Mont. 409] 673 P.2d 1277, 1279, 41 St.Rep. 40, 42).

This Court has held that upon an affirmative answer to all three questions, collateral estoppel bars litigation regarding an issue in a civil trial which was previously litigated in a criminal trial. Aetna Life and Cas. Ins. Co. v. Johnson, 673 P.2d at 1279-80, [207 Mont. at 414] 41 St.Rep. at 42-43. “We have since broadened this holding by applying this test to all cases in which collateral estoppel is at issue.” In Re Marriage of Holland (Mont. 1986), [224 Mont. 414,] 730 P.2d 410, 412, 43 St.Rep. 2293, 2295.

Peschel does not challenge the second and third elements of collateral estoppel as related above. Instead, he focuses on the first element and states that the prior adjudication did not decide the identical issues raised in this case. Peschel is correct in that none of his identical individual issues were determined in prior litigation. The issue must be identical, and we are unable to locate where issues identical to those raised by Peschel were previously litigated. For example, the first issue raised in Peschel’s complaint would be whether defendant Jones was negligent when he failed to procure the consent of HUD to Addenda No. 1. This identical issue has not been decided by prior litigation and is not prohibited under the theory of collateral estoppel. Still, we affirm the District Court based on a different reasoning.

The District Court granted the first motion for partial summary judgment by analyzing facts established in the prior litigation, applying them to this cause of action, and concluding that as to certain issues raised in Peschel’s complaint there was no genuine issue as to any material fact and that defendant Jones was entitled to a judgment as a matter of law on those issues. In other words, certain facts established in prior litigation now make some of Peschel’s current claims to be without merit. Counsel for Peschel has admitted that he is bound by those facts established in the prior litigation. The District Court certainly has the authority to take judicial notice of facts established in related prior litigation. In doing so, the District Court correctly determined that there was no genuine issue as to any material fact regarding certain issues raised in Peschel’s complaint.

The allegations Peschel states in sub-paragraphs (a), (c), (d), (f), and (g), all relate to the consent and commitment of HUD and Washington Mortgage. We previously noted that shortly after construction began in 1978, “problems arose concerning Peschel’s obligations to fund the cost shortages during the course of construction.” Martin Development Co., 703 P.2d at 145, 42 St.Rep. at 753. Addenda No. 1 was the result of negotiations to settle these matters and was not related to HUD. The parties agree that it was Peschel’s obligation to properly fund those amounts exceeding that guaranteed by HUD. Additionally, the consent and commitment of Washington Mortgage was not necessary because they notified Peschel he defaulted on his loan October 2, 1979 and that it would be assigned to HUD. Addenda No. 1 was not signed until November 10, 1979 and the consent and commitment of Washington Mortgage after notice of default and assignment would have been meaningless. Since the prior litigation establishes a situation where there is now no genuine issue as to any material fact, the District Court correctly granted summary judgment on these issues.

Peschel alleges in sub-paragraphs (b), (h), and (i) that Jones was negligent in his advice to Peschel and in not obtaining the consent and a guarantee of completion from Martin Development’s bonding company. However, it has been established that the bonding company would not have been liable in any event because there was no default by Martin Development. Martin Development Co., 703 P.2d at 146-147, 42 St.Rep. at 755-756. Finally, Peschel alleges in sub-paragraph (j) that defendant was negligent in not negotiating provisions “requiring the contractor to produce lien waivers each month so that progress disbursements would not be held up.” However, the financing difficulties were entirely unrelated to this issue and the reason draw No. 13 was not paid was because Washington Mortgage previously assigned the loan to HUD. Martin Development Co., 703 P.2d at 145, 42 St.Rep. at 754. We affirm the District Court decision granting partial summary judgment as to issues listed in Peschel’s complaint in paragraph V, sub-paragraphs (a), (b), (d), (f), (g), (h), (i), and (j), and the portion of sub-paragraph (c) referring to the failure to obtain the consent of Washington Mortgage to Addenda No. 1.

2. Statute of Limitations.

On December 8, 1987, the District Court granted an additional partial summary judgment favoring defendant Jones as to all of plaintiff Peschel’s remaining issues. This included two additional issues added to Peschel’s complaint by amendment. The District Court held that Peschel’s remaining claims were barred by the statute of limitations for a legal malpractice action.

Section 27-2-206, MCA, states:

“An action against an attorney licensed to practice law in Montana or a paralegal assistant or a legal intern employed by an attorney based upon the person’s alleged professional negligent act or for error or omission in the person’s practice must be commenced within 3 years after the plaintiff discovers or through the use of reasonable diligence should have discovered the act, error, or omission, whichever occurs last, but in no case may the action be commenced after 10 years from the date of the act, error, or omission. (Emphasis added.)”

Peschel filed his complaint November 14, 1985, and the District Court noted that “the crucial question is whether [Peschel] discovered or through the use of reasonable diligence should have discovered the alleged act, error, or omission prior to November 14, 1982.” The District Court concluded that “under the established facts, [Peschel] discovered or though the use of reasonable diligence should have discovered the alleged acts, errors or omissions prior to November 14, 1982.”

Peschel’s claims remaining after the first partial summary judgment were as follows (claims (m) and (n) were added by amendment):

(c) Defendant’s failure to negotiate resolution of current default with Washington Mortgage Company.

(e) Defendant’s release and discharge of the contractor, Martin, from all claims in Paragraph 11 of the Addenda, the exoneration clause.

(k) Defendant’s advice that Plaintiffs liability under the Addenda was limited to a total of $65,000.00.

(l) Defendant’s advice against accepting a proposal by the bonding company to build a third building and thereafter litigate pending issues.

(m) Defendant’s advice that Plaintiff sign a letter of exoneration of the contractor’s prior defaults and send it to HUD.

(n) Defendant’s failure to attach financial exhibits and the HUD agreement to the Addenda. Peschel claims he did not discover the facts essential to a cause of action until after January 25, 1984, when a district court decision found judgment for Martin Development and against Peschel in the amount of $72,000. See, Martin Development Co., 703 P.2d at 145, 42 St.Rep. at 754. Although Peschel knew of many of the above facts, he argues he did not know those facts might constitute a cause of action until he was found liable to Martin Development. In short, he asserts he had knowledge of the acts, but did not have knowledge of the alleged negligence.

The general issue to be determined is whether Peschel discovered or through the use of reasonable diligence should have discovered, the allegedly negligent acts, errors, or omissions by defendant Jones before November 14, 1982. We have previously addressed similar issues and in Burgett v. Flaherty (1983), 204 Mont. 169, 173-174, 663 P.2d 332, 334, we stated:

“As a matter of law, what is critical in determining when a legal malpractice action accrues is knowledge of the facts essential to the cause of action, not knowledge of the legal theories upon which an action may be brought.

“[I]t is the knowledge of facts rather than discovery of legal theory, that is the test. The test is whether the plaintiff has information of circumstances sufficient to put a reasonable person on inquiry, or has the opportunity to obtain knowledge from sources open to his or her investigation. (Sanchez v. South Hoover Hospital 18 Cal.3d. 93, 101, 132 Cal.Rep. 657, 553 P.2d 1129.) If the plaintiff believes that someone has done something wrong because of the damages suffered by her, such a fact is sufficient to alert a plaintiff ‘to the necessity for investigation and pursuit of her remedies.’ (Sanchez v. South Hoover Hospital, supra, 18 Cal.3d at 102, 132 Cal.Rep. at 663, 553 P.2d at 1135.)”

Additionally, we have specifically rejected the “damage rule,” wherein the statute of limitations in a legal malpractice action would not begin to run until the plaintiff discovers his actual or determinable damages. Schneider v. Leaphart (Mont. 1987), [228 Mont. 483,] 743 P.2d 613, 616, 44 St.Rep. 1699, 1702. Such a rule would conflict with Section 27-2-206, MCA, which speaks to the discovery of the act, error, or omission, and not to the discovery of actual or determinable damages.

Despite this holding, Peschel states the statute of limitations should have been tolled on his malpractice claim until the District Court found him liable to Martin Development. Peschel contends this is the time he discovered he had a cause of action. Upon carefully reviewing each of Peschel’s remaining claims, it is clear that Peschel knew the facts giving rise to each claim and through the use of reasonable diligence he could have discovered any act, error, or omission believed to constitute negligence long before November 14, 1982. All of Peschel’s claims involve Jones’s preparation, presentation, and advice regarding Addenda No. 1. This document was signed November 10, 1979, more than three years before November 14, 1982. Peschel had litigation pending against him, he was required to contribute more money to the project than he believed to be his responsibility, construction was delayed, Washington Mortgage had sent Peschel a notice of default and assigned the loan to HUD, and the fund release known as Draw No. 13 was not paid in December, 1979. Peschel was aware of all of these events when they occurred, and long before November 14, 1982. After a careful review of all of the facts, we find that through the use of reasonable diligence Peschel had sufficient information to discover any alleged act, error or omission by Jones. We affirm the decision of the District Court granting partial summary judgment on Peschel’s remaining claims.

For the foregoing reasons, the decision of the District Court is affirmed.

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


author: MR. JUSTICE HUNT

text:
    In re the MARRIAGE OF JEFFREY J. SMITH, Petitioner and Respondent, and KATHLEEN FOLEY SMITH, Respondent and Appellant.
    No. 88-59.
    Submitted on Briefs June 2, 1988.
    Decided July 14, 1988.
    757 P.2d 784.

      Sol & Wolfe, Michael Sol, Missoula, for respondent and appellant.
    Thomas W. Trigg, Missoula, for petitioner and respondent.
   MR. JUSTICE HUNT

delivered the Opinion of the Court.

This appeal arises from a judgment of the District Court, Fourth Judicial District, County of Missoula, awarding joint custody of the two children with primary residential custody to the father. Mother appeals. We affirm. The issue on appeal is whether the District Court abused its discretion in awarding resident custody to the father by:

1. Improperly making extensive findings of fact not based on substantial, credible evidence.

2. Improperly weighing the evidence and testimony.

3. Failing to make any findings regarding the best interests of the daughter of the parties.

4. Awarding joint custody, but giving superior custody rights to the father’s girlfriend over the children’s natural mother.

The marriage of the appellant (mother) and respondent (father) was dissolved by order dated October 7, 1987, which was amended November 5, 1987. There were two children born of the marriage, Nate, age 9 and Julie, age 5. The parties have resolved the property issues to their satisfaction and primarily differ on the issue of custody of Nate and Julie.

Father is currently employed as a staff writer at a large hospital. He resides in Missoula with a companion.

Mother is a full-time student at the University of Montana. She is not currently employed. Throughout the marriage she contributed financially to the family income through her pottery craft.

An informal custody arrangement required that each parent get physical custody of the children every other week with some reasonable visitation by the other parent during the week. Mother has often taken care of the children during father’s week while he was at work.

The order of the District Court awarded joint custody of both children with father serving as primary residential parent. Mother was granted custody of the children two to three weekends per month, Thanksgiving, Easter and part of Christmas vacations, and summers. Each parent is allowed liberal visitation when custody resides with the other parent. From this order the mother appeals.

Mother attacks several of the District Court’s 89 findings of fact. She essentially argues that too many of the findings are uncomfortably similar to father’s proposed findings of fact and are not supported by substantial credible evidence on the record. Much of her complaint is that her contributions to the children’s welfare and growth were ignored.

To begin, this Court has recognized that even verbatim adoption of a party’s proposed findings of fact is not grounds for reversal if they are supported by substantial credible evidence. In re Marriage of Sessions (Mont. 1988), [231 Mont. 437,] 753 P.2d 1306, 1307, 45 St.Rep. 744, 746; In re Marriage of Watson (Mont. 1987), [227 Mont. 383,] 739 P.2d 951, 954, 44 St.Rep. 1167, 1170. Our task, then, is to examine the record to see if it contains evidence that supports the findings. There are 26 contested findings but we need not address each one individually. We will, however, take this opportunity to address a few of the contested findings.

Finding No. 29 is contested because it mentions a playwright who was a frequent houseguest of the father’s and who is reported to have read to the children. Mother claims there is no evidence that the guest reads to the children, and upon a thorough review of the record we find she is correct. This, however, is harmless error because the finding is not necessary to support the District Court’s decision. See In re Marriage of Anderson (Mont. 1986), [220 Mont. 477,] 717 P.2d 11, 14, 43 St.Rep. 541, 544. Mother also contests finding No. 14 which states that father took the children to church. The testimony of father plainly states, “I’ve taken them to church.” This Court has thoroughly examined each contested finding of fact and the record and have found nearly all to be supported by substantial credible evidence. While there are some findings in error, they are harmless, not grounds for reversal, and need not be discussed.

Next mother challenges the weight the court gave to the testimony of father’s witnesses. As a result, she argues, the court’s findings and conclusions paint an overly glowing portrait of father’s parenting skills. This Court may not substitute its judgment for that of the trial court. We must review the evidence in the light most favorable to father. The court acknowledged that each parent had told tales of less than virtuous behavior committed by the other parent. It chose to place more credibility in father’s witnesses and weighed their testimony accordingly. This is fully within its power. In re Marriage of Speer (1982), 201 Mont. 418, 422, 654 P.2d 1001, 1003. The court did not abuse its discretion in this regard.

Next, mother argues that the court failed to make any findings regarding the best interests of the daughter Julie and overemphasized the interests of Nate to Julie’s detriment. She argues that the court erred in holding that the best interests of the children required them to stay together and in ignoring the special bond between mother and daughter. We do not agree. The record is replete with testimony about Julie and her place in her father’s life and household. The findings of the court, while more concerned with Nate (who is a gifted child and has special educational needs), discuss Julie in a manner consistent with evidence on the record. Conclusion No. 13 recognizes the bond between Nate and Julie.

“13. Nate and Julie have a close bond. Given the hostility between Father and Mother, these two children need all of the stability and familiarity they can receive. It would not be in their best interest to split the children between the parents, (i.e. Nate with Father and Julie with Mother) because of the danger of the children identifying with the parent with whom they live at the expense of alienation from the other parent. The bond between the children, as they live in the separate homes of their Father and Mother, will remain of great value in the coming years.”

There was no error with regard to this issue.

Mother lastly contends that the District Court’s conclusion No. 19 confers superior custody rights to father’s household companion over her. The conclusion states:

“19. Mother should be allowed liberal visitation when the children are in Father’s custody. Father shall make an active effort to allow the children to visit their Mother, if she is available, rather than place the children in day care or [with] other non-family members.” (Emphasis added.)

After filing of the judgment, the District Court in court minutes dated January 7, 1988 ruled that the phrase “non-family members” does not include the father’s companion. We do not see how this provision hinges mother’s visitation rights upon the companion’s availability. It plainly states that if mother is available she must be allowed liberal visitation. The last clause explains that this is in preference to sending the children to day care or to friends. It does not limit the right of the mother to visit with her children. There is no mention of the companion’s availability with regard to visitation and her availability does not affect the mother’s visitation right. We hold that there was no error in the court’s judgment.

Affirmed.

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


author: MR. JUSTICE SHEEHY MR. JUSTICE WEBER,

text:
    NICK GEIGER, Plaintiff and Respondent, v. LAVONNE L. PIERCE, Defendant and Appellant.
    No. 88-76.
    Submitted on Briefs May 19, 1988.
    Decided July 14, 1988.
    Rehearing Denied Aug. 17, 1988.
    758 P.2d 279.
    John B. Carter, Pablo, for defendant and appellant.

      K.M. Bridenstine, Poison, for plaintiff and respondent.
   MR. JUSTICE SHEEHY

delivered the Opinion of the Court.

Lavonne L. Pierce appeals from an order of summary judgment from the District Court, Twentieth Judicial District, Lake County, awarding Geiger the sum of $4,500. We reverse.

Appellant raises the following issue for our review: Do the state courts of Montana have primary subject matter jurisdiction over a debt action arising on an Indian reservation, brought by a resident non-Indian creditor against an enrolled tribal member residing on the reservation?

The record discloses the following pertinent facts.

Pierce is an enrolled member of the Confederated Salish and Kootenai Tribes of the Flathead Reservation. She purchased a mobile home from Geiger, a nontribal member, at Geiger’s place of business in Poison, Montana. A written contract was entered into and all payments were to be made at Poison, Montana. Poison is within the exterior boundaries of the Flathead Reservation and both parties reside there.

On August 28, 1986, Geiger filed a complaint in District Court alleging that Pierce had failed to make the payments on the installment sales contract and owed the plaintiff $4,500.

After Pierce had answered Geiger’s amended complaint, on June 22, 1987, Geiger plaintiff filed a motion for summary judgment. The District Court issued an order granting summary judgment shortly thereafter. On July 23, 1987, Pierce filed her motion to vacate summary judgment claiming for the first time that the District Court lacked jurisdiction over the subject matter of the dispute because she is an enrolled member of the Confederated Salish and Kootenai Tribes. Briefs were submitted by both parties. The District Court found that it had subject matter jurisdiction over the action and denied Pierce’s motion to vacate summary judgment. Pierce appeals from the District Court’s order granting Geiger summary judgment as well as the court’s subsequent denial of Pierce’s motion to vacate the order.

The dispositive issue that we must address is whether the state courts of Montana have primary subject matter jurisdiction over a debt action arising out of transactions on an Indian reservation, brought by a non-Indian creditor against an enrolled tribal member debtor, both of whom reside on the reservation. We find that they do not.

In State ex rel. Iron Bear v. District Court (1973), 162 Mont. 335, 512 P.2d 1292, this Court held:

“Before a district court can assume jurisdiction in any matter submitted to it, it must find subject matter jurisdiction by determining:

“(1) Whether the federal treaties and statutes applicable have preempted state jurisdiction; (2) Whether the exercise of state jurisdiction would interfere with reservation self government; and (3) Whether the Tribal Court is currently exercising jurisdiction or has exercised jurisdiction in such a manner as to preempt state jurisdiction.”

162 Mont. at 346, 512 P.2d at 1299. See also Williams v. Lee (1959), 358 U.S. 217, 79 S.Ct. 269, 3 L.Ed.2d 251; Security State Bank v. Pierre (1973), 162 Mont. 298, 511 P.2d 325; see generally, Milbank Mut. Ins. Co. v. Eagleman (Mont. 1985), [218 Mont. 58,] 705 P.2d 1117, 42 St.Rep. 1393 (the first two elements of the Iron Bear test are disjunctive; if either is present, the state lacks subject matter jurisdiction.)

Generally civil jurisdiction over commercial activities presumptively lies in the tribal courts unless affirmatively limited by a specific treaty, provision or federal statute. Iowa Mutual Ins. Co. v. LaPlante (1987), 480 U.S. 9,_, 107 S.Ct. 971, 978, 94 L.Ed.2d 10, 16. The civil jurisdiction of the tribal court in this matter has not been affirmatively limited by a specific treaty, provision or federal statute. Although the State of Montana has criminal jurisdiction over the Flathead reservation, there has been no consent to assumption by the state of jurisdiction over commercial transactions occurring on that reservation.

In addition, the subject matter of the immediate case is clearly within the pre-emptive jurisdiction assumed by the tribal court of the Confederated Salish and Kootenai Tribes. See Chapter II, Civil Actions, Section 1, Confederated Salish and Kootenai Tribes’ Law and Order Code, Ordinance 36(b) as amended (1982). To find primary state courts jurisdiction over this action would impugn the tribal court’s right to resolve controversies arising out of commercial conduct occurring between Indians and non-Indians within the boundaries of the reservation. Such authority is clearly an important part of tribal sovereignty. See Montana v. United States (1981), 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493, Washington v. Confederated Tribes of Colville Indian Reservation (1980), 447 U.S. 134, 100 S.Ct. 2069, 65 L.Ed.2d 10; Fisher v. District Court (1976), 424 U.S. 382, 96 S.Ct. 943, 47 L.Ed.2d 106.

It is apparent that the exercise of state jurisdiction in the immediate case would interfere with reservation self-government. As we have stated:

“A tribe’s interest in self-government could be implicated in one of two ways. First, if a state or federal court resolves a dispute which was within the province of the tribal courts or of other non-judicial law applying tribal institutions, that court would impinge upon the tribe’s right to adjudicate controversies arising within it. Second, if the dispute itself calls into question the validity or propriety of an act fairly attributable to the tribe as a governmental body, tribal self government is drawn directly into the controversy ....

“We have recognized that the tribal court is generally the exclusive forum for the adjudication of disputes affecting the interests of both Indians and non-Indians which arise on the reservation.”

Milbank, 705 P.2d at 1119, 42 St.Rep. at 1396; citing R.J. Williams Co. v. Fort Belknap Housing Auth. (9th Cir. 1983), 719 F.2d 979, 983-84, cert. den. 472 U.S. 1016, 105 S.Ct. 3476, 87 L.Ed.2d 612 (1985). We therefore conclude that the District Court here lacked subject matter jurisdiction.

However, Geiger contends that Pierce’s failure to raise the state court’s lack of subject matter jurisdiction constitutes a bar to that defense. We disagree.

“. . . It is a fundamental axiom of our legal system that the issue of subject matter jurisdiction may be invoked at any time in the course of a proceeding. Larrivee v. Morigeau (1979), 184 Mont. 187, 192, 602 P.2d 563, 566, cert. den. 445 U.S. 964, 100 S.Ct. 1653, 64 L.Ed.2d 240; Corban v. Corban (1972), 161 Mont. 93, 96, 504 P.2d 985, 987. Furthermore once the issue is raised and a court determines that there is a lack of subject matter jurisdiction, it can take no further action in the case other than to dismiss it. Rule 12(h)(3), M.R.Civ.P.”

In Re Marriage of Lance (Mont. 1984), [213 Mont. 182,] 690 P.2d 979, 981, 41 St.Rep. 2032, 2034.

Although Pierce could have raised the issue of the state court’s lack of subject matter jurisdiction earlier in the proceeding, her failure to do so is not fatal to her claim. We hold that the District Court’s exercise of jurisdiction over this matter, a civil action on a commercial transaction brought by Geiger against Pierce, an enrolled member of the Confederated Salish and Kootenai Tribes, arising within the exterior boundaries of the reservation, interferes with tribal sovereignty and the tribe’s right of self-government. The state court’s jurisdiction over the subject matter was pre-empted by tribal jurisdiction. Accordingly, we reverse the summary judgment granted in the District Court, and direct dismissal of the action upon remittitur.

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

MR. JUSTICE WEBER,

specially concurring:

While I am forced to acknowledge that federal caselaw requires that this case be dismissed from the state district court for jurisdictional reasons, I am not at all comfortable with the result. As Judge McNeil said in his opinion below:

“The inequity of granting Defendant’s Motion to dismiss at this stage of the instant case is obvious. At the time the commercial transaction was entered into, the Plaintiff could not inquire into the tribal member status of the Defendant in order to determine in advance that a State Court forum would be available in the event of a default on the contract. If such an inquiry were made, the Defendant could quite properly claim that her race was a consideration in her, application for credit in the form of the installment sale contract giving rise to a claim of discrimination based on race.

“Likewise, at the commencement of this action neither the Plaintiff nor the Court could properly inquire into the tribal member status of the Defendant because the Montana Constitution provides that courts of justice shall be open to every person and that no person may be discriminated against on account of race.

“This Court is not unaware of the Federal Courts’ rationale that the sovereign nation concept is a ‘political classification’ and not an ‘ethnic classification’ based on race. The Tribal Council of the Confederated Salish and Kootenai Tribes establishes the criteria for enrollment in said Tribe based on a quantum of Indian blood as determined by said Tribal Council. Non-Indians are not eligible for enrollment. The Federal Courts may consider that to be a political classification for jurisdictional purposes, but it surely appears to this State Court to be a distinction based on race.

“The Constitution of Montana provides that no person shall be denied the equal protection of the laws and that neither the State nor any person shall discriminate against any person in the exercise of his civil or political rights on account of race. Sec. 4, Art. II, Declaration of Rights. In addition, the Constitution of Montana provides that courts of justice shall be open to every person and speedy remedy afforded for every injury. Sec. 16, Art. II, Declaration of Rights. The Montana Constitution further provides that no person shall be deprived of life, liberty or property without due process of law. Sec. 17, Art. II, Declaration of Rights.”

Under the holding of the United States Supreme Court as discussed in Pierre, we are required to deny subject matter jurisdiction, even though that issue was raised by the Indian defendant only after the entry of judgment in the underlying cause. As a result, I concur in the opinion reversing the District Court.

I have a sense of frustration similar to that described by the District Court. It seems basically unfair to allow an Indian person to use the state courts so long as that person decides it is to her benefit, but to deny the non-Indian party an equivalent right of access to the same court in this contract dispute. The plaintiff here has been placed in a “Catch-22” position. Before the execution of the contract, the plaintiff here was constitutionally forbidden from asking the defendant if she was an Indian and if she was a member of the Confederated Salish and Kootenai Tribes. When the action was commenced by the plaintiff, there was no basis for an inquiry by the plaintiff nor the court as to whether the defendant was an Indian person who was a member of the Tribe and who claimed a lack of subject matter jurisdiction. As a result, the Indian person was allowed to proceed through the state court trial process to the point of judgment against her, when she concluded it was no longer advantageous to stay in that court. At that point, she could then raise the subject matter jurisdiction question and negative the judgment against her. As a nation, we may be commended for our attempt to protect the Indian people through our state and federal laws. Certainly there was a long period of time when that protection was denied to the Indian people. However, we can be condemned for our failure to develop a just and workable system for both Indians and non-Indians who deal with the Indian people. Here the plaintiff has been denied justice. In the long run, decisions of this type will insure that the Indian people will be penalized as non-Indians protect themselves from dealings with Indian people. I am not proud of the result of this opinion.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES HARRISON and GULBRANDSON concur in the foregoing special concurrence.


author: MR. JUSTICE McDONOUGH MR. JUSTICE SHEEHY,

text:
    HELEN MAJOR, Individually and as Personal Representative of the Estate of Judith M. Eayrs, and as Guardian and Conservator of the Estate of Hallie Jean Eayrs, a minor, Julie Sina Johnson and Leigh Johnson, Plaintiffs and Appellants, v. NORTH VALLEY HOSPITAL and Del B. Coolidge, M.D., Defendants and Respondents.
    No. 87-511.
    Submitted on Briefs May 12, 1988.
    Decided July 15, 1988.
    Rehearing Denied Aug. 17, 1988.
    759 P.2d 153.

      Richard A. Reep, Datsopoulos, MacDonald & Lind, Missoula, for plaintiffs and appellants.
    Stephen C. Berg, Warden, Christiansen, Johnson & Berg, Kalispell, I. James Heckathorn, Murphy, Robinson, Heckathorn & Phillips, Kalispell, for defendants and respondents.
   MR. JUSTICE McDONOUGH

delivered the Opinion of the Court.

Plaintiff Helen Major, individually and as Personal Representative of the Estate of Judith M. Eayrs, appeals from the summary judgment order of the District Court of the Eleventh Judicial District, Flathead County, declaring her claim barred by the applicable statute of limitations. We affirm.

Appellant presents two issues for review:

1. “Whether the District Court Erred in Making Findings of Fact upon Defendants’ Motion for Summary Judgment.”

2. “Whether the District Court Erred in Finding as a Matter of Law that the Statute of Limitation Barred the Claims of Helen Major, individually and as Personal Representative of the Estate of Judith Eayrs.”

The facts can be summarized as follows: At approximately 7:40 a.m. on March 20, 1982, appellant received a telephone call from her daughter, Judith Eayrs (Judy). Judy told appellant that she was suffering from an extremely sore throat and needed medical attention. Appellant drove to her daughter’s apartment, and at approximately 8:00 a.m., called North Valley Hospital in Whitefish to inform personnel there of Judy’s condition and imminent arrival. While both appellant and her daughter lived in Kalispell, they decided it would be best to travel to Whitefish because Judy’s treating physician and medical records were located there. Judy suffered from systemic lupus erythematosis, a disease with multiple symptoms including episodes of swelling in the throat with attendant breathing difficulty, and had been treated several times at North Valley Hospital.

Upon arriving at the hospital emergency room, appellant learned that the nurse on duty had not yet contacted Judy’s doctor, Dr. Ricker. The nurse logged a call to Dr. Ricker’s clinic at 8:38 a.m. relaying Judy’s complaint that her throat felt like it was closing shut. Dr. Ricker was not available that day, and the call was taken by his partner, Dr. Coolidge. The nurse called Coolidge again at approximately 9:00 a.m., and he arrived at the emergency room at approximately 9:20 a.m.

After being examined by Dr. Coolidge, Judy was taken for chest X-rays and admitted to the general ward. At approximately 10:20 a.m., she lunged from her bed toward the window and collapsed on the floor of her room. A code blue was sounded, but those attending Judy could not revive her, and she died of respiratory arrest.

In May of 1982, appellant sought legal assistance concerning a possible medical malpractice action arising out of Judy’s death. On advice of counsel, she requested access to Judy’s hospital records in July of 1982, but did not take possession of copies of those records until October of 1984. On April 17, 1985, appellant filed an Application for Review with the Medical-Legal Panel concerning the treatment received by Judy. This malpractice action was filed on August 9, 1985. The defendants moved for summary judgment based on the passing of more than three years between Judy’s death and the filing of the Application for Review by the Medical-Legal Panel. The District Court granted the motion and entered its order of summary judgment on December 22, 1986. The order was certified as a final judgment on July 27, 1987, in order to facilitate an appeal to this Court.

Issue I

Appellant presents essentially two arguments regarding the District Court’s alleged error in making findings of fact. She first contends that the mere presence of findings in the court’s order was error. Appellant cites case authority from this Court that summary judgment is not to be utilized as a substitute for trial of factual controversies.

Appellant is correct that summary judgment is not a vehicle for deciding factual issues. However, she has failed to offer any authority for her assertion that including findings of fact in an order granting summary judgment is reversible error. As we have previously held, facts simply are not decided when summary judgment is granted. Rule 56, M.R.Civ.P., requires that there be no issue of material fact in order for summary judgment to issue. Inclusion of findings of fact in an order of summary judgment is therefore unnecessary and redundant. Boise Cascade Corp. v. First Security Bank of Anaconda (1979), 183 Mont. 378, 385, 600 P.2d 173, 178. In Boise, we held that the failure of the appellant to assign error to the findings of fact in the court’s summary judgment order had no effect on the appeal. We did not hold the inclusion of the findings to be reversible error, and we decline to do so in this case.

Appellant’s second argument is that the District Court made findings involving disputed issues of fact, and has thereby “precluded the Plaintiff from presenting certain proof at the time of trial.” Appellant does not cite any authority that could give an indication of the basis for her argument. However, while the court’s summary judgment order will operate to remove appellant from this action individually and as personal representative of her daughter’s estate, she will remain a party as guardian of Hallie Jean Eayrs, Judy’s minor daughter, and presumably will wish to enter factual proof in that capacity. We will therefore examine her argument in order to foreclose any doubts as to her ability to continue in her capacity as guardian.

The most relevant basis for appellant’s argument is the “law of the case” doctrine, which states that once an issue has been judicially determined, that decision should put the issue to rest for the remainder of the case. State v. Carden (1976), 170 Mont. 437, 555 P.2d 738. However, the law of the case doctrine does not apply when a separate issue is involved. In B.M. by Berger v. State (Mont. 1985), [215 Mont. 175,] 698 P.2d 399, 42 St.Rep. 272, we held that the doctrine did not preclude a district court from granting summary judgment, even though this Court had earlier reversed an order granting summary judgment to the same party in the same case. The later summary judgment was upheld because it was based on a different motion and grounded on different issues. Berger, 698 P.2d at 401-02. The issue involved in this summary judgment is the running of the statute of limitations against appellant. The judge did not attempt to reach the merits of the malpractice claim. Conversely, the statute of limitations will not be an issue at the trial on the merits. The statute of limitations issue will be settled by the District Court’s summary judgment order, but because it is an issue separate from the merits of this case, the summary judgment order cannot preclude appellant from attempting to prove the facts of her case.

Issue II.

Appellant asserts that the District Court erred in granting summary judgment on the basis of the running of the statute of limitations. She again advances two arguments. First, she argues that the statute did not begin to run until she discovered the legal cause of her daughter’s death. Second, she asserts that the statute was tolled by acts, errors or omissions of the defendants.

Under our interpretation of Rule 56, M.R.Civ.P., summary judgment is properly granted if “there is no genuine issue as to any fact deemed material in light of the substantive principles that entitled the movant to judgment as a matter of law.” Fleming v. Fleming Farms, Inc. (Mont. 1986), [221 Mont. 237,] 717 P.2d 1103, 1105-06, 43 St.Rep. 776, 779. The substantive principle involved here is the three-year statute of limitations for medical malpractice cases:

“Action in tort or contract for injury or death against a physician or surgeon, dentist,. . . based upon alleged professional negligence or for rendering professional services without consent or for an act, error or omission, shall ... be commenced within 3 years after the date of injury or 3 years after the plaintiff discovers or through the use of reasonable diligence should have discovered the injury, whichever occurs last,. . . However, this time limitation shall be tolled for any period during which there has been a failure to disclose any act, error, or omission upon which such action is based and which is known to him or through the use of reasonable diligence subsequent to said act, error, or omission would have been known to him.” Section 27-2-205(1), MCA.

Judy Eayrs died on March 20, 1982. On April 17, 1985, appellant filed an Application for Review with the Medical-Legal Panel, and initiated this action August 9, 1985. Normally, filing an application with the panel tolls the running of the statute of limitations until 30 days after the panel renders its decision. Section 27-6-702, MCA. However, three years and 27 days elapsed between Judy’s death and the filing of the application. The District Court found that the statute had run as to appellant, and defendants were therefore entitled to summary judgment.

Appellant first asserts that the court’s ruling was erroneous under the “discovery doctrine” incorporated in Section 27-2-205(1), MCA, through the words “3 years after the plaintiff discovers or through the use of reasonable diligence should have discovered the injury”. She argues the statute did not begin to run until she “discover[ed] facts providing a causal connection between her daughter’s death and the acts, errors or omissions of her daughter’s health care provider.” Appellant further argues that because Montana law requires expert testimony to prove malpractice, this “discovery” did not take place until she came into possession of her daughter’s medical records in October of 1984, giving her the opportunity to have the records reviewed by an expert. We disagree.

Appellant notes that this Court has not yet construed Section 27-2-205, MCA, and cites Bennett v. Dow Chemical Co., et al., (Mont. 1986), [220 Mont. 117,] 713 P.2d 992, 43 St.Rep. 221, for guidance in the application of the discovery doctrine. In Bennett we stated, “the fact that a party with a cause of action has no knowledge of his rights, or even the facts out of which the cause arises, does not delay the running of the statute of limitations until [the party] discovers the facts or learns of his rights under those facts.” Bennett, 713 P.2d at 994. However, we also noted that in cases where the plaintiff was prevented from knowing of his injury by concealment or other circumstances, certain recognized exceptions would operate to toll the statute of limitations. It is this discussion that appellant relies on for her interpretation of the discovery doctrine.

As we said in Bennett, the farthest reaches of the discovery doctrine in Montana are represented by the case of Hornung v. Richardson-Merrill, Inc. (D.Mont. 1970), 317 F.Supp. 183. In Hornung, the court tolled the statute of limitations in a products liability case until the plaintiff discovered that his cataracts may have been caused by the defendant’s drug. Appellant knew that her daughter’s death may have been caused by medical malpractice on the day she died. She testified in deposition that on March 20,1982, she thought Judy did not receive adequate treatment at the hospital, describing the events of the day as a “nightmare”.

Furthermore, we have held that failure to understand the causal relationship between an injury and the alleged wrongful act will not resuscitate a claim on which the statute of limitations has run. E. W. v. D.C.H. (Mont. 1988), [231 Mont. 481,] 754 P.2d 817, 820, 45 St.Rep. 778, 782-83, citing Mobley v. Hall (1983), 202 Mont. 227, 657 P.2d 604. Appellant’s alleged lack of knowledge of the facts connecting her daughter’s death to acts of the defendants did not prevent her from discovering the injury at issue in this case.

Appellant also contends that the statute was tolled by the acts or omissions of the defendants, which concealed the cause of Judy’s death. She points to the language in Section 27-2-205, MCA, providing for such a toll for failure to disclose any act, error or omission upon which the action is based. According to her brief, appellant was stymied in her attempts to gain access to Judy’s records, first by the failure of Dr. Coolidge to finalize the records and then by the refusal of the hospital to allow her access to them.

The statutory language pointed to by appellant is the codification of the doctrine of fraudulent concealment. To toll the statute of limitations in a medical malpractice case, “It is the cause of action which must be fraudulently concealed by failing to disclose the fact of injury from malpractice, by diverting the patient from discovering the malpractice that is the basis of the action.” Monroe v. Harper (1974), 164 Mont. 23, 28, 518 P.2d 788, 790, (emphasis supplied). Appellant obviously was cognizant of the fact of the injury complained of here on the day her daughter died. As pointed out above, appellant was also aware of the alleged wrongful acts complained of in this case on that day, and therefore “discovered” her cause of action on March 20, 1982. She was not prevented from doing so through acts of concealment by defendants.

The District Court was correct in issuing its order granting summary judgment. The cause of action accrued on March 20, 1982, and the application for review was not filed with the Medical-Legal Panel until April 17, 1985. The statute of limitations had run against appellant, and there being no basis for tolling the statute, no issue of material fact existed as to defendants’ entitlement to summary judgment.

We affirm the order of the District Court.

MR. CHIEF JUSTICE TURNAGE and MR. JUSTICES. HARRISON, WEBER and GULBRANDSON concur.

MR. JUSTICE SHEEHY,

dissenting:

I dissent to the interpretation put upon the statutory language of Section 27-2-205(1), MCA, by the majority.

One basis of my dissent is that the majority have changed the tolling language of the statute from a failure to disclose to one of fraudulent concealment of information. That interpretation is a severe limitation on the legislative act, for it constricts the tolling statute to actual fraud by the medical person. The word “fraud” appears nowhere in the statute. The time for filing an action for malpractice could as well be tolled for negligent concealment as for fraudulent or intentional concealment, if the statutes were properly construed.

The second basis of my dissent is that fraudulent concealment is not involved in this case. What is involved is the issue when the plaintiff, through the use of reasonable diligence, could have discovered the claimed medical malpractice. The tolling statute, Section 27-2-205(1), applies solely to malpractice cases. It has three distinct features: (1) the statute of limitations for medical malpractice is three years, but it is tolled (2) until the plaintiff discovers or by reasonable diligence should have discovered the medical malpractice, or (3) during the period when the medical person has failed to disclose the malpractice known to him or by reasonable diligence should have been known to him. Here the plaintiff’s case falls in the second category: when did she discover through reasonable diligence the claimed malpractice?

When the issue is properly examined, one sees that a question of fact exists as to when the statute began to run. The District Court, and now the majority, resolved that issue summarily by holding that on the date of death she should reasonably have known that the death was caused or accelerated by malpractice. I disagree with that conclusion. No lay person should be considered to have that degree of expertise about the treatment of lupus so as to impute as a matter of law knowledge of malpractice in the course of the treatment. I don’t have that kind of expertise and neither does any member of this Court. The time for filing her action should be tolled in this case at least for the period required by reasonable diligence to find and consult with experts about the treatment of the decedent. That is a question of fact, not susceptible to summary judgment by any court. Undoubtedly the reasonable period would take more than 27 days, for which period the plaintiff is here denied her day in court.

I would reverse the summary judgment and remand for further proceedings, including determination of the fact issue as to the tolling of the limitations statute.

MR. JUSTICE HUNT joins in the foregoing dissent.