Rierson v. State

• Court: Montana Supreme Court
• Decided: January 5, 1981
• Docket: 79-032
• Status: Published

Opinion

No. 79-32

I N THE SUPREME COURT OF THE STATE O M N A A F OTN

A. C. RIERSON,

P l a i n t i f f and A p p e l l a n t ,

THE STATE O IIIONTANA, AND BOARD F O ADMINISTRATION OF PERS, F

D e f e n d a n t and R e s p o n d e n t .

A p p e a l from: D i s t r i c t Court of t h e F i r s t J u d i c i a l D i s t r i c t , I n and f o r t h e County o f Lewis and C l a r k . H o n o r a b l e Gordon B e n n e t t , J u d g e p r e s i d i n g .

C o u n s e l o f Record:

For Appellant:

Conner, B a i z and O l s o n , G r e a t F a l l s , Montana D e n n i s Conner a r g u e d , G r e a t F a l l s , Montana

F o r Respondent:

Hugh, B e n n e t t , K e l l n e r and S u l l i v a n , H e l e n a , Montana J o h n F. S u l l i v a n a r g u e d , H e l e n a , Montana

S u b m i t t e d : F e b r u a r y 26, 1980

Urn%& 2 ,; - & Clerk Mr. J u s t i c e John Conway H a r r i s o n d e l i v e r e d t h e Opinion of t h e Court.

A p p e l l a n t , A 1 ~ i e r s o n ,p e t i t i o n e d t h i s C o u r t f o r r e h e a r -

i n g of h i s o r i g i n a l a p p e a l , i n which we a f f i r m e d t h e D i s t r i c t

C o u r t o r d e r d i s m i s s i n g h i s o r i g i n a l and amended p e t i t i o n f o r

j u d i c i a l r e v i e w of a n a d m i n i s t r a t i v e agency d e c i s i o n . Re-

h e a r i n g was g r a n t e d , and t h e c a u s e s u b m i t t e d on b r i e f s .

R i e r s o n ' s case was commenced i n D i s t r i c t C o u r t a s a n

a c t i o n f o r j u d i c i a l r e v i e w of a Board of A d m i n i s t r a t i o n

d e c i s i o n which d e n i e d R i e r s o n ' s c l a i m f o r a d d i t i o n a l re-

tirement benefits. The p e t i t i o n f o r r e v i e w w a s f i l e d on

J a n u a r y 11, 1978, b u t t h e r e was no s u b s e q u e n t s e r v i c e o n t h e

Board. An "amended c o m p l a i n t " w a s s e r v e d on t h e Board o v e r

a y e a r l a t e r on May 29, 1979. The Board f i l e d a motion t o

d i s m i s s R i e r s o n ' s c o m p l a i n t on t h e grounds t h a t i t d i d n o t

comply w i t h t h e "prompt s e r v i c e " r e q u i r e m e n t of t h e Adminis-

t r a t i v e P r o c e d u r e Act. S e c t i o n 2-4-702 ( 2 ) ( a ) , MCA. The

D i s t r i c t C o u r t g r a n t e d t h e motion t o d i s m i s s , and R i e r s o n

appealed t o t h i s Court.

I n a n o p i n i o n d a t e d A p r i l 1, 1980, w e a f f i r m e d t h e

D i s t r i c t C o u r t f i n d i n g t h a t t h e s i x t e e n and o n e - h a l f month

d e l a y i n s e r v i n g n o t i c e upon t h e Board was n o t r e a s o n a b l e

under t h e f a c t s of R i e r s o n ' s c a s e . Mr. J u s t i c e Sheehy a r -

gued i n h i s d i s s e n t t h a t t h e Board d i d n o t have s u b j e c t

m a t t e r j u r i s d i c t i o n o v e r two of R i e r s o n ' s t h r e e c l a i m s , and

s i n c e t h e Board d i d n o t have t h e a u t h o r i t y t o d e c i d e c o n s t i -

tutional issues o r t o r t issues against i t s e l f , ~ i e r s o n ' s

p e t i t i o n s h o u l d be c o n s i d e r e d one f o r i n d e p e n d e n t r e l i e f

t o which t h e "prompt s e r v i c e " r e q u i r e m e n t would n o t a p p l y .

Mr. J u s t i c e Daly j o i n e d i n t h e d i s s e n t i n g o p i n i o n . On ~ p r i l

11, 1980, R i e r s o n p e t i t i o n e d t h i s C o u r t f o r r e h e a r i n g b a s e d on the position taken by Justices Sheehy and Daly in the dissent. In 1971 the responsibility for the administration of the highway patrol retirement system was transferred from the ~ighwayPatrolmen's Retirement Board to the Board of Administration of the Public Employees' Retirement System. Until 1971 a retiring patrolman with more than twenty-five years of service could receive retirement benefits in ex- cess of one-half regular pay. When the responsibilities for the patrolmen's retirement system were transferred, an attorney for the Board of Administration interpreted this practice to be in violation of sections 31-209 and 31-213, R.C.M. 1947. This interpretation was adopted as Board policy on April 21, 1972, and applied prospectively so that patrol- men retiring after April 21 could receive a maximum of one- half pay even if they continued on the job after their twenty-fifth year of service. Rierson retired at the end of his twenty-five years of service on April 8, 1974. Nearly two years later on March 18, 1976, Rierson's attorney demanded an adjustment of Rierson's retirement benefits. In that demand letter Rierson's attorney noted that "a suit will be filed no later than April 9, 1976", and further that, "[tlime is of the es- sence in that the Statute of Limitations is about to run in this matter." The Board responded by suggesting that Rierson avail himself of administrative remedies since the Board had adopted contested case procedures. By a letter dated April 6, Rierson formally requested an administrative hearing before the Board. A hearing was granted and held

on July 15, 1976. At the conclusion of that hearing, Rierson's attorney was directed to submit a brief in support of R i e r s o n ' s p o s i t i o n by August 9, 1976. N brief was o

f o r t h c o m i n g , and a f t e r s e v e r a l months had e l a p s e d , t h e

Board s e n t a l e t t e r t o R i e r s o n ' s a t t o r n e y a d v i s i n g him t h a t

a d e c i s i o n would be made w i t h o r w i t h o u t a b r i e f . Nearly

e i g h t months a f t e r t h e h e a r i n g , on March 11, 1977, R i e r s o n ' s

b r i e f was s u b m i t t e d .

I n h i s b r i e f R i e r s o n claimed t h a t h e w a s e n t i t l e d t o

a d d i t i o n a l b e n e f i t s b e c a u s e of due p r o c e s s and e q u a l p r o t e c -

t i o n v i o l a t i o n s and on t h e grounds o f p r o m i s s o r y e s t o p p e l .

The h e a r i n g s examiner responded t o a l l t h r e e c l a i m s i n t h e

proposed f i n d i n g s o f f a c t , c o n c l u s i o n s of law and a n o r d e r

d e n y i n g R i e r s o n a d d i t i o n a l b e n e f i t s on August 25, 1977. The

proposed d e c i s i o n was a d o p t e d by t h e Board, and R i e r s o n w a s

n o t i f i e d o f t h e d e c i s i o n on December 1 2 , 1977.

On J a n u a r y 11, 1978, R i e r s o n ' s a t t o r n e y f i l e d a p e t i -

t i o n f o r j u d i c i a l review i n t h e D i s t r i c t Court. Notice

was n o t g i v e n t o t h e Board of R i e r s o n ' s p e t i t i o n . No f u r -

t h e r a c t i o n was t a k e n by R i e r s o n f o r s i x t e e n and one-half

months. Then, on May 21, 1979, R i e r s o n f i l e d an "amended

c o m p l a i n t " which was s e r v e d on t h e Board on May 29, 1979.

T h i s was t h e B o a r d ' s f i r s t n o t i c e of any j u d i c i a l proceed-

i n g i n t h e case. The Board moved t o d i s m i s s b o t h t h e

o r i g i n a l and amended p e t i t i o n s . The D i s t r i c t C o u r t t r e a t e d

t h e p e t i t i o n s a s r e q u e s t s f o r j u d i c i a l r e v i e w which would

r e q u i r e "prompt s e r v i c e " of n o t i c e t o t h e Board under t h e

Administrative Procedure A c t . Upon r e h e a r i n g , R i e r s o n c o n t e n d s t h a t t h e ~ i s t r i c t

Court e r r e d i n f a i l i n g t o t r e a t h i s p e t i t i o n f o r j u d i c i a l

r e v i e w a s a n i n d e p e n d e n t c i v i l a c t i o n t o which t h e "prompt

s e r v i c e " r e q u i r e m e n t would n o t a p p l y . W e find that i f error

w a s committed, i t would n o t have a f f e c t e d t h e d e c i s i o n of t h e D i s t r i c t Court.

Although R i e r s o n c h o s e t o have h i s c a s e h e a r d by t h e

Board, h e a r g u e s on a p p e a l t h a t t h e B o a r d ' s d e c i s i o n i s n o t

b i n d i n g , and, moreover, s i n c e h i s c l a i m s d e a l t w i t h c o n s t i -

t u t i o n a l i s s u e s and a t o r t c l a i m a g a i n s t t h e Board, h i s

c l a i m s c o u l d n o t have been r e s o l v e d by a n a d m i n i s t r a t i v e

body. Although a p p e l l a n t ' s D i s t r i c t C o u r t a c t i o n was f i l e d

under t h e A d m i n i s t r a t i v e P r o c e d u r e A c t , on r e h e a r i n g h e

a s s e r t s t h a t he s h o u l d n o t be allowed t o p r o c e e d w i t h h i s

c l a i m under r u l e s a p p l i c a b l e t o o r i g i n a l D i s t r i c t C o u r t

a c t i o n s , u n h i n d e r e d by t h e r e q u i r e m e n t s of a d m i n i s t r a t i v e

procedural r e s t r i c t i o n s . It i s interesting t o note t h a t

a l t h o u g h t h e j u r i s d i c t i o n a l i s s u e was f i r s t r a i s e d by

J u s t i c e Sheehy i n h i s d i s s e n t , R i e r s o n a r g u e s t h a t i t h a s

always been h i s i n t e n t i o n t o proceed i n D i s t r i c t C o u r t w i t h

a n a c t i o n i n d e p e n d e n t of t h e B o a r d ' s unrewarding d e c i s i o n .

W e must c o n c l u d e t h a t even i f t h e D i s t r i c t C o u r t c l a i m

i s an independent c i v i l a c t i o n , o r i g i n a l i n t h a t c o u r t ,

R i e r s o n ' s own f a i l u r e t o p u r s u e t h a t a c t i o n h a s l e f t him

w i t h o u t a remedy on a p p e a l . Clearly, i f t h e D i s t r i c t Court

a c t i o n i s a n i n d e p e n d e n t a c t i o n , R i e r s o n i s bound by t h e

s t a t u t e of l i m i t a t i o n s which a p p l i e s t o s u c h a c t i o n s . In

c a s e s where damage t o p r o p e r t y r i g h t s i s a r g u e d , any c a u s e

must be b r o u g h t w i t h i n two y e a r s . S e c t i o n 27-2-207, MCA.

I n h i s r e p l y Rierson a s s e r t s t h a t t h e a p p l i c a b l e l i m i t a t i o n

i s t h a t f o r w r i t t e n c o n t r a c t s ( s e c t i o n 27-7-202(1), MCA)

which i s e i g h t y e a r s , o r o b l i g a t i o n s , o t h e r t h a n a c o n t r a c t ,

and n o t founded on a w r i t t e n i n s t r u m e n t ( s e c t i o n 27-2-202(3),

MCA) which i s t h r e e y e a r s . N e i t h e r of t h e s e s t a t u t e s o f l i m i t a t i o n s i s a p p l i c a b l e i n o u r view. Rierson's claims

i n v o l v e d two c o n s t i t u t i o n a l v i o l a t i o n s and a r e q u e s t f o r i n v o c a t i o n of t h e d o c t r i n e o f p r o m i s s o r y e s t o p p e l . Only i n t h e b r o a d e s t s e n s e c o u l d t h e s e l i m i t a t i o n s be c o n s i d e r e d

t o be c o n t r o l l i n g , and s i n c e t h e r e i s a more s p e c i f i c s t a t -

u t e i n v o l v i n g i n j u r y t o p e r s o n a l p r o p e r t y r i g h t s , of which

r e t i r e m e n t b e n e f i t s are one, we a r e constrained t o follow t h e more s p e c i f i c s t a t u t e . S e c t i o n 1-3-225, MCA. See a l s o

B u t t e Country Club v . Dept. of Revenue (1980) , Mont.

, 607 P.2d 551, 37 St.Rep. 479. W a l s o note t h a t e

R i e r s o n a d m i t t e d t h e a p p l i c a b i l i t y of a two-year statute

of l i m i t a t i o n s i n h i s l e t t e r t o t h e Board of March 1 8 , 1976.

Having concluded t h a t t h e two-year s t a t u t e of l i m i t a -

t i o n s i s appropriate i n t h i s case, w e f u r t h e r find t h a t

Rierson's D i s t r i c t Court a c t i o n i s barred. R i e r s o n h a s been

aware of t h e e f f e c t of t h e two-year s t a t u t e of l i m i t a t i o n s

s i n c e he f i r s t demanded t h a t h i s b e n e f i t s be a d j u s t e d i n

1976. The e n t i r e h i s t o r y of t h i s c a s e i s one of n e g l e c t

and p r o c r a s t i n a t i o n . H e d i d n o t a p p r o a c h t h e Board f o r a n

a d j u s t m e n t u n t i l n e a r l y two y e a r s a f t e r h i s r e t i r e m e n t .

C l e a r l y h i s c a u s e o f a c t i o n a c c r u e d no l a t e r t h a n h i s re-

t i r e m e n t d a t e , and from t h e r e c o r d , t h e r e i s no e x c u s e f o r

a d e l a y of one y e a r and 360 d a y s which would o b l i g a t e t h i s

Court t o excuse R i e r s o n ' s t a r d i n e s s . When he was n o t i f i e d

t h a t t h e a d m i n i s t r a t i v e p r o c e s s was o v e r , he had f i v e d a y s

r e m a i n i n g w i t h i n t h e c o n f i n e s of s e c t i o n 27-2-207(1), MCA,

t o f i l e h i s i n d e p e n d e n t and o r i g i n a l c o m p l a i n t i n D i s t r i c t

Court. I n s t e a d , he f i l e d a p e t i t i o n f o r j u d i c i a l r e v i e w on

J a n u a r y 11, 1978, t w e n t y - f i v e d a y s a f t e r h i s n o t i f i c a t i o n

of t h e a d v e r s e agency r u l i n g . Although t h a t a c t i o n was

f i l e d within the thirty-day limitation f o r petitions f o r j u d i c i a l r e v i e w of a d m i n i s t r a t i v e a c t i o n s , t h i s C o u r t w i l l

n o t a l l o w t h e a d m i n i s t r a t i v e a p p e a l p e r i o d t o be added t o t h e two-year s t a t u t e of l i m i t a t i o n s , t h u s b o o t s t r a p p i n g h i s o r i g i n a l and i n d e p e n d e n t a c t i o n i n t o compliance w i t h t h e

s t a t u t e of l i m i t a t i o n s by u s e of an a d m i n i s t r a t i v e a c t i o n

h e now c o n t e n d s i s v o i d .

Throughout t h e c o u r s e of R i e r s o n ' s s u i t a g a i n s t t h e

Board, he h a s had t h e o p t i o n of a n i n d e p e n d e n t D i s t r i c t C o u r t

petition for relief. Although urged by t h e Board t o s e e k

a d m i n i s t r a t i v e r e m e d i e s , he was n o t r e q u i r e d t o do s o .

T h i s C o u r t must r e s p e c t t h e r e q u i r e m e n t t h a t remedies be

s o u g h t w i t h some d e g r e e of d i l i g e n c e . R i e r s o n knew of t h e

new i n t e r p r e t a t i o n of t h e r e t i r e m e n t laws a s e a r l y a s J u n e

20, 1972. I n t h e two-year p e r i o d between t h a t d a t e and

h i s r e t i r e m e n t i n A p r i l o f 1974, he made no e f f o r t t o s e e k

any k i n d of remedy. H i s c l a i m s l a y dormant f o r a l m o s t an-

o t h e r two y e a r s u n t i l A p r i l 5 , 1976, b e f o r e he r e q u e s t e d

an administrative hearing. During t h a t h e a r i n g , R i e r s o n

d e l a y e d t h e p r o c e e d i n g s f o r a n o t h e r e i g h t months b e f o r e sub-

mitting h i s brief. T h i s C o u r t w i l l n o t condone m a n i p u l a t i o n

of t h e law s o t h a t a c a s e may be f u r t h e r p u r s u e d . To do s o

would be a n a f f r o n t t o t h e l e t t e r and t h e s p i r i t of t h e

s t a t u t e s of l i m i t a t i o n s . Viewed i n t h e b e s t p o s s i b l e l i g h t ,

R i e r s o n ' s s u i t a g a i n s t t h e Board s t i l l shows s u b s t a n t i a l

e v i d e n c e of i n e x c u s a b l e n e g l e c t . W e find t h a t the action

i n D i s t r i c t C o u r t i s b a r r e d by t h e two-year s t a t u t e of

l i m i t a t i o n s of s e c t i o n 27-2-207(1), MCA.

W r e a f f i r m t h e D i s t r i c t Court d i s m i s s a l . e We concur:

"sng $4ia%&@, Chlef Justice

Justices

Mr. Justice Daniel J. Shea concurring:

I concur with the decision here affirming the trial

court's dismissal order. This is a case where the appellant, from beginning to end, slept on his rights. Mr. J u s t i c e John C . Sheehy and M r . J u s t i c e Gene B. Daly dissenting:

W i t e r a t e w i t h o u t d i l u t i o n what w e s a i d i n o u r d i s s e n t e

t o t h e o r i g i n a l o p i n i o n i n t h i s c a u s e ( D i s s e n t , Cause No.

79-32, 37 St.Rep. 627). I n i t s o p i n i o n on t h e p e t i t i o n f o r

rehearing foregoing, t h e majority has c i r c l e d the i s s u e s r a i s e d

by o u r d i s s e n t and t h e p e t i t i o n f o r r e h e a r i n g , i n s o c i r c l i n g ,

t h e m a j o r i t y h a s s t i r r e d up as much d u s t a s i t d i d i n t h e o r i g i n a l

o p i n i o n , t o t h e e x t e n t t h a t t h e i s s u e s i n t h i s c a s e are f u r t h e r

obscured.

O r i g i n a l l y , t h i s was a r e l a t i v e l y s i m p l e c a s e : Rierson,

a r e t i r e d highway p a t r o l m a n , had p e t i t i o n e d t h e D i s t r i c t C o u r t

f o r r e v i e w o f an a d v e r s e d e c i s i o n a g a i n s t him by a n a d m i n i s t r a -

t i v e agency. H e had f i l e d h i s p e t i t i o n f o r r e v i e w w i t h i n 30

d a y s , b u t i n s t e a d o f s e r v i n g a copy o f t h a t p e t i t i o n upon t h e

a d m i n i s t r a t i v e agency, h e w a i t e d 16 months when h e amended h i s

p e t i t i o n and s e r v e d a summons i s s u e d upon t h a t p e t i t i o n . The

o n l y r e a l i s s u e i n t h i s c a s e i s whether t h e p r o v i s i o n of

s e c t i o n 2-4-702(2) ( a ) , MCA, t h a t a copy of t h e p e t i t i o n f o r

r e v i e w " s h a l l be promptly s e r v e d upon t h e agency", s e r v e s t o

p r e v e n t t h e D i s t r i c t C o u r t from c o n s i d e r i n g agency e x c e s s e s o f

s t a t u t o r y a u t h o r i t y i n d e c i d i n g q u e s t i o n s o f c o n s t i t u t i o n a l law

and a t o r t c l a i m a g a i n s t i t s e l f . W e had s u g g e s t e d some p r o p e r

answers i n o u r o r i g i n a l d i s s e n t ; u n f o r t u n a t e l y o u r powers o f

d i s c u s s i o n seemed i n s u f f i c i e n t .

I t had been a h a p p i e r c i r c u m s t a n c e f o r u s i f t h e m a j o r i t y

had s i m p l y d e c i d e d t h a t s i x t e e n months t o make s e r v i c e f a i l e d

t o c o n s t i t u t e "prompt" s e r v i c e , t h a t prompt s e r v i c e was

j u r i s d i c t i o n a l , and t h a t t h e r e f o r e , R i e r s o n was o u t o f c o u r t . I n s t e a d , t h e m a j o r i t y c a r e e n e d o f f on a s i d e t r i p o v e r t h e

s t a t u t e o f l i m i t a t i o n s , and w e may be some t i m e g e t t i n g t h i s

C o u r t back on t h e r o a d a g a i n on t h i s s u b j e c t .

-9- The majority buys itself a peck of trouble when it declares in dictum (we hope it will be considered dictum) that the statute of limitations continues to run on separable causes intermingled with the limited cause adjudicable by the admini- strative agency. That dictum is wrong because limitations should be tolled when the claimant is not neglecting to proceed in some forum on a phase of his claim, and when the other party has full notice while the claimant so proceeds of his additional but intermingled claims. Otherwise, as in this case, an admini- strative agency can act in excess of its authority, a ground provided in section 2-4-704, MCA, for which an administrative decision can be set aside, and never be called to account in a court of law because the statute of limitations may have run on the cause which the agency incorrectly assumed jurisdiction to decide. The majority opinion does not deal with our contentions respecting the judicial review statute for administrative cases, section 2-4-702, MCA, and particularly, it has not looked at that statute with respect to the statute of limitations on "independent" or intermingled causes. Again, the first paragraph of that section provides: "A person who - exhausted all administrative - has remedies available within the agency and who is aggrieved by a final decision in a contested case is entitled to judicial review under this chapter. This section - - limit utilization does not of - - - - of judicial review available under - or the scope other means of review, redress, relief, or trial de - - novo provmed Q statute." Section 22-702(1) (a), MCA. (Emphasis added.) That quoted statute contemplates, in our view, full judicial review not only of causes with which the administrative agency has authority to act upon, but also cases where it violates its constitutional or statutory provisions. Indeed, that is provided, as we have noted, in section 2-4-704(2)(a), MCA. -10- Our second objection to the majority opinion on rehearing in deciding this case on the statute of limitations is that apparently the court had decided incorrectly which statute applies. This case does not concern an "injury to personal property." This was not Rierson's automobile that was damaged; this was, at the least, a liability created by statute governed by section 27-2-211(1) (c), MCA (two-year limitation). We would hold that the pension dispute grows out of the relationship of master and servant which is contractual in nature (53 Am.Jur. 2d 92 Master - Servant B 14), and that either the five-year and or eight-year period applies under section 27-2-202, MCA. Rierson's tort action however has a two-year limitation, section 27-2-207, MCA, which again points up the necessity for tolling the statute while he is pursuing his administrative remedy. Certainly the agency should not be allowed to determine a tort action brought against itself. We would reverse and remand to the District Court for further proceedings. Whether he would be successful there, we do not know, but at least the courts of justice would be open to him, 1972 Mont. Const., Art. 11, 5 16, and he would not be deprived of due process.

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