No. 85-380 

IN THE SUPREME COURT OF THE STATE OF MONTANA. 

1986 

MILDRED FLANIGAN, 

Plaintiff and Respondent, 

PRUDENTIAL FEDERAL SAVINGS & LOAN 

ASSOC. , a federally chartered banking 

corporation, and FRED OGOLIN, 

Defendants and Appellants. 

APPEAL FROM: District Court of the Second Judicial District, 

In and for the County of Silver BOW, 

The Honorable Mark Sullivan, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

David J. Wing argued, Butte, Montana 

For Respondents: 

Poore, Roth & Robinson; Donald C. Robinson argued, 

Butte, Montana 

Submitted: April 24, 1986 

Decided: June 5, 1986 

@ 

*&d-@#@J 

Clerk 
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of 

the Court. 

Plaintiff brought this action in the First Judicial 

District Court to recover damages based upon wrongful 

termination from employment. The jury returned a verdict in 

favor of plaintiff, awarding her $94,170 in economic damages, 

$100,000 for emotional distress and exemplary damages in the 

amount of $1,300,000. Defendants appeal. We affirm. 

Mildred Flanigan (respondent) was hired as a teller on 

January 28, 1952, by Prudential Federal Savings and Loan 

Association. She worked in various capacities until April 

15, 1-980, at which time Fred Ogolin, Vice President and 

Manager of Prudential Federal Savings and Loan, Butte Branch, 

fired her. Hereafter, the two defendants will be referred to 

jointly as the appellants unless it is necessary to 

distinguish them by specific reference. 

The issues presented for review involve substantial 

credible evidence questions. We therefore will detail the 

facts and, as we must, in a light favorable to respondent. 

First National Bank in Libby v. Twombly (Mont. 1984), 689 

P.2d 1226, 1230, 41 St.Rep. 1948, 1952; Jacques v. Montana 

National Guard (Mont. 1982), 199 Mont. 493, 503, 649 ~.2d 

1319, 1325. 

Following commencement of her employment, respondent 

worked as a teller for approximately 14 years, performing in 

a satisfactory fashion. In 1966 she became branch office 

bookkeeper. That position was eliminated because of a change 

in technology and in 1973, the respondent moved into the 

mortgage loan department where she became branch general 

clerk. She maintained this position until 1976, when she 

became assistant loan counselor. Respondent performed 

satisfactorily in all positions. 
On December 7, 1979, prior to respondent's termination, 

the president of Prudential prepared an interoffice 

memorandum entitled "Personnel Information and Policy 

Change". This memorandum was distributed to all employees 

formally advising them of economic turndowns and the 

resulting need of Prudential to reduce its work force. The 

memorandum was discussed at the staff meeting in Butte, 

Montana, on December 13, 1979. Respondent was present. In 

the latter part of January, 1980, respondent was advised by 

Fred Ogolin that her position as assistant loan counselor was 

to be terminated as of June 1, 1980. After discussion, 

Ogolin advised respondent of a teller training program in 

Salt Lake City, Utah, and asked her if she desired to broaden 

her job slcills. Respondent accepted the offer and on March 

2, 1980, she attended the week-long program. On March 18, 

1980, after her return to Butte, respondent began working as 

a teller. Less than one month later, respondent was 

terminated without notice and without hearing. She was given 

six months pay as a severance benefit and paid her 

accumulated profit sharing benefits of $48,428.02. After 

respondent was terminated, she was offered, by letter dated 

June 9, 1981, a part-time position as teller. After 

consultation with counsel, the offer was rejected. 

Within two weeks following her termination, respondent 

filed an age discrimination complaint with the Human Rights 

Commission. She received a "right to sue" letter and filed 

this complaint on April 13, 1983. 

After consolidating several of appellants' issues, we 

find the following questions govern the outcome of this 

appeal : 
1. Was there substantial credible evidence to support 

submission of respondent's case to the jury based upon breach 

of the implied covenant of good faith and fair dealing? 

2. Did the District Court err in its treatment of the 

negligence issue? As sub-issues we determine whether it was 

error for the trial court to allow amendment of the 

pleadings; whether the negligence count was barred by the 

statute of limitations; whether comparative negligence was 

applicable; and whether workers' compensation was the 

exclusive remedy? 

3. Did the District Court err in allowing opinion 

testimony from expert witnesses about the covena.nt of good 

faith and fair dealing? 

4. Was it error to refuse admission of defendant's 

Exhibit U.U.? 

5. Did the District Court err in failing to reduce 

damages by $26,290.53, the amount the plaintiff would have 

received had she not refused to accept the position as a 

part-time teller following her termination? 

6. Was there substantial credible evidence to submit 

punitive damages to the jury? We include within this issue 

the question of whether punitive damages were excessive as a 

matter of law. 

ISSUE ONE 

Was there substantial credible evidence to support 

submission of respondent's case to the jury based upon breach 

of the implied covenant of good faith and fair dealing? 

The principal argument advanced by appell-ants is that 

Prudential was experiencing severe economic conditions and 

terminated the respondent in a legitimate reduction-in-force 

move designed to curb costs. Appellants argue that a Montana 

jury should not be a silent partner in every decision made to 
terminate employees. Reliance is placed upon the language of 

Professor Gary Murg and Clifford Scharman, in an article 

titled "Employment at Will: Do the Exceptions Overwhelm the 

Rule?" 23 Boston College L.R. 329, 372 (1982), wherein it 

was said: 

. . . A jury should not be entitled to second guess 

an employer's policy or practices to determine that 

they are insufficient justifications for a 

discharge. Such an approach would leave virtually 

all personnel practices open to communal comment. 

A personnel practice that is justifiable to one 

jury may be found pernicious to another. The 

likely result would then be to subject employers to 

the threat of suit in every instance of a discharge 

as the employee attempts to find a jury sympathetic 

to his cause. Thus, the only issue that should be 

posed to the jury is whether the personnel practice 

was applied equally to all employees. It is 

submitted that if an employer's promise of 

continued employment is to be given contractual 

force courts must limit the discretion of the jury 

in determining what constitutes good cause. 

Respondent disputes that she was terminated as part of a 

reduction-in-force program. She points to the testimony of 

Ogolin, who fired her. Oqolin testified at trial that, but 

for the respondent's alleged poor performance as a teller, 

she would have remained employed by Prudential. In earlier 

testimony Ogolin had said that under no circumstances would 

the respondent have remained with the company. 

Respondent argues that the dual and contradictory 

reasons for termination advanced at trial by the appellants 

reveal an arbitrary, capricious and bad faith firing. 

Respondent notes the following Ogolin testimony which is 

supportive of a reduction in force: 

Q. (By Mr. Robinson) . . . Would Mildred have 

been let go if in the three weeks she worked as a 

teller she had appeared to be performing as well as 

any other average teller in your operation? 

A. (By Mr. Ogolin) Yes. I had already made the 

decision that Mildred's job was going to he, or 

position was going to be eliminated . . . . 
Q. So, how well she performed in that three-week 

period had nothing --- to do with your decision to 

terminate -- her on April - 15, - 1980, --- is that true? 

A. That's correct. That decision was made before 

she performed as a teller trainee in the Butte 

office. 

Q* - So, you wouldn't have considered -- her for staying no matter --- how she had performed - as - a teller, 

L-- oodor bad, --- is that true? 

A. That's right, yes. 

Q. That would be true even if she had performed as 

well as Connie Selon who had worked as a teller for 

4 years? 

A. Yes, that's true. 

(Tr. pp. 437-438) (Emphasis supplied-) 

Several days later Ogolin, testifying in his own 

defense, gave this contradictory testimony: 

Q. You put in a 1-ot of testimony today about the 

fact that she didn't perform well according to your 

opinion but it's true, is it not, -- as you testified 

-- last week that it wouldn't have made any difference 

how she had performed, - she still would -- have lost 

- her job, isn't that true? 

A. - Yes, I testified to that. . . . 

Q. Are you changing your testimony from last 

Wednesday? 

A. I'm saying that the facts were not that. 

Q. My question again one last time, --- if she had 

performed --- as well as another teller, could -- she have 

kept her job? 

A. - Yes. 

Q. Oh. So, you have changed your testimony from 

last Wednesday, -- is that correct? 

Yes. A. - 

(Tr. pp. 1058-1059) (Emphasis supplied-) 

Additionally, respondent argues that the employer 

violated its own written policies regarding job security and 
job rights by terminating the respondent without notice and 

without hearing. Further, respondent maintains that she was 

entitled to be recalled to fill vacant positions but that she 

was not recalled except insofar as she was offered a 

part-time teller position. 

Respondent offered evidence that her discharge was 

motivated by vindictiveness on the part of Ogolin. Because 

of seniority, respondent had a superior right to vacation 

time, even before Ogolin. She testified that when she asked 

the reason for her termination, Ogolin stated that she was 

"not making it as a teller" and that she was "vindictive" 

because she had used her seniority to select her four weeks 

of vacation during the month of August. 

The reason for discharge was disputed by Prudential. 

Several months later, Prudential's president informed 

respondent, for the first time, that she was discharged as 

part of a company wide reduction in force. The president 

stated that "seniority or past performance was not 

considered" in the decision to discharge. 

Implicit throughout the respondent's case is the 

allegation that she was terminated because of her age and 

because of a desire on the part of the employer to cut costs 

associated with respondent's pension. Younger and less 

experienced employees, who had lower composite performance 

evaluations and who occupied positions respondent previously 

held, remained working after respondent's firing. Ogolin 

admitted that any errors respondent made as a teller were not 

sufficient to warrant discharge. Ogolin further admitted 

that respondent was never warned, reprimanded or counseled 

about her performance as a teller, all prerequisites to 

termination according to Prudential's own policies. 

Prudential supervisors admitted that 60 days to six months 
were normally required before one could become proficient as 

a teller. The decision to discharge respondent, however, was 

made after respondent worked less than three weeks in the 

teller position. 

A long-term employee has an expectation of continued 

employment provided that the employee's work performance is 

satisfactory. Dare v. Montana Petroleum Marketing Co. (~ont. 

course, this does not foreclose an employer from engaging in 

legitimate reductions in force necessary to maintain the 

economic vitality of the company. However, there is evidence 

in this record, from the lips of Ogolin himself, that 

respondent was fired for poor work performance. The jury 

could have relied upon this latter testimony and therefore 

concluded there was no reduction in force. 

The standard for ascertaining whether factual issues 

exist in a wrongful discharge case were articulated by the 

majority opinion in Dare, supra. We there said: 

The record discloses remaining genuine issues of 

material fact regarding Dare's wrongful discharge 

claim. The parties relate widely divergent 

versions of Dare's work performance and reasons for 

her termination. It therefore remains for the 

trier of fact to resolve these issues, includinq 

the reason for Dare's termination and whether - she 

was fired for cause. (Emphasis supplied. ) 

The cause referred to in Dare is different from the 

"good cause" applicable in determining the propriety of an 

employee's termination under a contract for a specified term. 

In Pugh v. See's Candies, Inc. (Cal.~pp. 1981), 116 

Cal.App.3d 311, 171 Cal. Rptr. 917, the California Appeals 

Court for the First District, Division 1, noted the 

distinction as follows: 

By what standard that burden is to be measured will 

depend, in part, upon what conclusions the jury 
draws as to the nature of the contract between the 

parties. The terms "just cause" and "good cause, " 

"as used in a variety of contexts . . . have been 

found to be difficult to define with precision and 

to be largely relative in their connotation, 

depending upon the particular circumstances of each 

case." -- (R. J. Cardinal Co. v. Ritchie (1963) 218 

Cal.App.2d 124, 144, 32 Cal.Rptr. 545.) 

Essentially, they connote "a fair and honest cause 

or reason, regulated by good faith on the part of 

the party exercising the power." (Id., at p. 145, 

32 Cal.Rptr. 545.) Care must be taken, however, 

not to interfere with the legitimate exercise of 

managerial discretion. "Good cause" in this 

context is quite different from the standard 

applicable in determining the propriety of an 

employee's termination under a contract for a 

specified term. (Footnote omitted.) 

In Dare, supra, the heightened expectations resulting 

from long-term employment were the primary basis for 

reversing summary judgment in favor of the employer. Justice 

Weber, writing for the majority, said: 

The presence of such facts [long-term employment] 

indicates that the term of employment has gone 

beyond the indefinite period contemplated in the at 

will employment statute, section 39-2-503, MCA, and 

is founded upon some more secure and objective 

basis. In such cases, the implied covenant 

protects the investment of the employee who in good 

faith accepts and maintains employment reasonably 

believing their job is secure so long as they 

perform their duties satisfactorily. 

Closely allied with Justice Weberls reasoning in Dare is 

the California case of Cleary v. American Airlines, Inc. 

wherein the Second District Court of Appeal, Division 1, 

stated: 

Two factors are of paramount importance in reaching 

our result that plaintiff has pleaded a viable 

cause of action. One is the longevity of service 

by plaintiff - 18 years of apparently satisfactory 

performance. Termination of employment without 

legal cause after such a period of time offends the 

implied-in-law covenant of good faith and fair 

dealing contained in all contracts, including 

employment contracts. As a result of this 

covenant, a duty arose on the part of the employer, 

Arnerj-can Airlines, to do nothing which would 
deprive plaintiff, the employee, of the benefits of 

the employment bargain - benefits described in the 

complaint as having accrued during plaintiff's 18 

years of employment. 

The covenant, in a long-term employment situation, only 

requires the employer to have a fair and honest reason for 

termination. An employee's incompetence or lack of loyalty 

certainly constitute sufficient reasons under this standard. 

However, as in this case, an employer may recognize by 

company policy an obligation to provide warnings and an 

opportunity for change. Respondent's evidence, if believed, 

proves that appellants failed to give respondent any 

opportunity to correct mistakes or otherwise conform her 

conduct. 

Appellants' motivation for the termination was rendered 

suspect by Ogolin's inconsistent testimony on the witness 

stand. The jury may well have chosen not to believe 

appellants' whole case, in light of Ogolin's lack of 

credibility. 

Respondent's 28 years of employment by Prudential gave 

her a secure and objective basis for believing that, if her 

work was satisfactoril-y performed, her employment would 

continue. From the evidence presented, the jury could have 

found that appellants had no fair and honest cause for 

discharge and, in fact, had ulterior motives. A case for 

jury deliberation was presented on the issue of wrongful 

termination. 

ISSUE TWO 

Did the District Court err in its treatment of the 

negligence issue? As sub-issues we determine whether it was 

error for the trial court to allow amendment of the 

pleadings; whether the negligence count was barred by the 
statute of limitations; whether comparative negligence was 

applicable; and whether workers' compensation was the 

exclusive remedy? 

Appellants argue that the negligence count was added 

five years after termination and was thus barred by the three 

year statute of limitations. This argument was recently 

disposed of in Sooy v. Petrolane Steel Gas, Inc. (Mont. 

1985), 708 P.2d 1014, 1017, 42 St.Rep. 1702, 1705-1706. A 

complaint can be amended to include a new theory of recovery 

where the basis for the new claim is the same occurrence 

involved in the old claims. In this case, respondent argues 

that the negligence claim and the claim for breach of implied 

covenant of good faith and fair dealing arise out of the same 

occurrence, include the same fa.cts and only involve different 

legal theories. We agree. The amendment was proper. 

Negligence has been recognized by this Court to be a 

proper basis for recovery in wrongful termination cases. 

Negligence was approved by this Court in Crenshaw v. Bozeman 

Deaconess Hospital (Mont. 1984), 693 P.2d 487, 493, 41 

St.Rep. 2251, 2259, wherein we said: 

The allegation of negligence was clearly 

established in respondent's complaint. We hold the 

trial court committed no error in issuing the 

instruction to the jury. 

In Crenshaw, this Court relied upon the fact that 

plaintiff's expert on personnel ma.nagement testified that the 

discharge was made without a proper investigation by the 

hospital administrator. Likewise, in this case, expert 

testimony revealed that appellants committed 13 different 

violations of Prudential firing policies. We find the 

precedent of Crenshaw compelling and hold the negligence 

theory was proper. 
Appellants argue that workers' compensation is the 

exclusive remedy for negligence. However, appellants cite no 

authority for the argument that there is a workers1 

compensation remedy available for wrongful termination in 

employment. In fact, the tort of wrongful termination does 

not occur until the employment is terminated. The plaintiff 

could hardly be injured in the course and scope of employment 

by a tort that occurred subsequent to the existence of the 

employment itself. 

Finally, appellants contend that they were entitled to 

an instruction on comparative negligence. Again, no 

authority is cited to support this proposition. Ordinarily, 

comparative negligence must relate to the same occurrences 

which are the subject of the negligence alleged against 

defendant. Blair v. Eblen (Ky. 1970), 461 S.W.2d 370; 

Ferrara v. Leventhal (N.Y.App.Div. 1977), 56 A.D.2d 490, 392 

N.Y.S.2d 920. The negligence relied upon in the case before 

us involves negligent failure to review prior performance and 

work history. Appellants do not contend that respondent 

violated any duty in this regard. Any negligence of 

respondent during the course of employment, such as work 

mistakes, would go to the question of whether there was a 

reasonable basis for the firing. That question was submitted 

to the jury. 

In awarding punitive damages the jury found appellants' 

conduct to be llwil.lfulll. Even if the trial court should have 

submitted respondent's negligence to the jury, any error in 

that regard would be harmless. Negligence is not a defense 

to willful conduct. Simonson v. White (Mont. 1986), 713 P.2d 

983, 987-988, 43 St.Rep. 133, 139. 
ISSUE THREE 

Did the District Court err in allowing opinion testimony 

from expert witnesses about the covenant of good faith and 

fair dealing? 

Appellants claim error in the District Court's admission 

of opinion testimony from expert witnesses about the covenant 

of good faith and fair dealing. Again, this issue was 

resolved in Crenshaw v. Bozeman Deaconess Hospital, supra. 

The rationale for our holding in Crenshaw was stated by 

Justice Harrison: 

The instant case is not a scenario of simple facts. 

Fault arising from breach of implied. covenant of 

good faith and fair dealing is not easily 

comprehensible to the average person. [The 

expert's] testimony was based on professional 

expertise and experience which the individual jury 

members were unlikely to possess. Her testimony 

assisted the trier of fact by providing the jury 

with information and a prospective (sic) beyond the 

common experience of a lay juror. (Citations 

omitted. ) 

As noted previously, the experts who testified on behalf 

of respondent found 13 different violations of Prudential 

policies and personnel practices. Appellants complains that 

one expert was permitted to evaluate whether Prudential 

followed its policy as established in one of Prudential's own 

memoranda. However, appellants failed to object at time of 

trial. It is fundamental that a party may not raise, for the 

first time on appeal, alleged errors pertaining to the 

introduction of evidence or testimony that was not objected 

to at the time of trial. Scofield v. Estate of Wood (Mont. 

In Crenshaw, supra, this Court approved expert testimony 

interpreting written employment policies. We said: 

The trier of fact's experience does not extend to 

Hospital disciplinary guidelines, much less the 

ability to evaluate the propriety of such 
guidelines. . . . The trial court in its broad 

discretion admitted the expert testimony. The 

trial court's order will not be disturbed on appeal 

in the absence of a clear showing of a manifest 

abuse of discretion. (Citations omitted.) 

Pursuant to the precedent established by Crenshaw, 

supra, respondent was justified in utilizing expert 

testimony. In permitting the expert witnesses to interpret 

employment policies, the trial court acted within its 

discretion. 

ISSUE FOUR 

Was it error to refuse admission of defendant's Exhibit 

U.U.? 

Appellants contend that the trial court erred in 

refusing to admit a summary of teller transactions performed 

by various tellers during the few days that respondent worked 

as a teller prior to her termination. The exhibit was 

objected to and the objection was sustained on the grounds 

that it was a compilation of after-acquired evidence 

regarding respondent's performance; that the information was 

not known to appellants at the time of termination; and that 

Ogolin had not examined the compilations for the purpose of 

making a decision about firing respondent. Therefore, the 

after acquired-evidence could not be used to support 

termination at time of trial. See Swanson v. St. John's 

Lutheran Hospital (1979), 182 Mont. 414, 422, 597 P.2d 702, 

706-707. The trial court ruling was correct. In any event, 

Ogolin was allowed to testify as to the essence of the 

information contained in the exhibit. Any error on the part 

of the trial court in refusing the exhibit was harmless in 

light of Ogolin's testimony. 
ISSUE FIVE 

Did the District Court err in failing to reduce damages 

by $26,290.53, the amount the plaintiff would have received 

had she not refused to accept the position as a part-time 

teller following her termination? 

Appellants contend that respondent's award for loss of 

wages, that sum being $94,170, should have been reduced by 

the trial court in the amount of $26,290.53, based on 

respondent's alleged failure to mitigate da.mages by accepting 

Prudential's offer of part-time employment'. 

There was abundant evidence that the respondent sought 

to mitigate her damages by seeking other employment. 

However, the law does not require respondent to mitigate 

damages by accepting inferior employment from her former 

employer. The rule was stated by the California Supreme 

Court in Parker v. Twentieth Century-Fox Film Corp. (Cal. 

1970), 474 P.2d 689, wherein the court said: 

[Rlefore projected earnings from other employment 

opportunities not sought or accepted by the 

discharged employee can be applied in mitigation, 

the employer must show that the other employment 

was comparable, or substantially similar, to that 

of which the employee has been deprived; the 

em~lovee's & z reiection of or failure to seek other 

available empioyment of a different - or inferior 

kind may not be resorted to in order to mitigate 

damages. (Emphasis supplied. ) (Citations 

omitted. 1 

Appellants requested, and were given, a. complete and 

accurate mitigation instruction. The instruction reflected 

the case law, above cited, stating that a wrongfully 

terminated person has a duty to reasonably seek and maintain 

other employment, but no duty to accept inferior employment. 

We find the trial court did not err in its handling of this 

issue. 
ISSUE SIX 

Was there substantial credible evidence to submit 

punitive damages to the jury? We include within this issue 

the question of whether punitive damages were excessive as a 

matter of law. 

We have detailed the evidence presented by respondent in 

support of her claim for breach of implied covenant of good 

faith and fair dealing. That evidence need not be restated 

here. In addition to the evidence previously set forth, 

testimony from appellants' president revealed a calloused 

attitude toward older employees. Prudential's Donovan 

referred to older employees as "dead wood", "old dead wood", 

and "ballast". He reiterated at time of trial that he 

considered Mildred Flanigan to be "ballast". 

The jury could have inferred malice from the lack of 

ca.ndor on the part of appellants. Appellants' position at 

time of trial was that respondent was terminated for 

inadequate performance yet, 14 months later, appellants 

offered respondent a part-time job. Further, Ogolin first 

testified that respondent was terminated because of a 

reduction in force and then later testified that she was 

terminated because of inadequate work performance. The jury 

may have chosen to believe she was terminated because of 

Ogolin's resentment stemming from respondent depriving him of 

the choicest vacation times. 

Appellants argue that they had no notice that their 

conduct would be subject to punitive damages. However, the 

punitive damage statute, S 27-1-221, MCA, was in effect at 

the time appellants committed the subject acts. Appellants 

were fully apprised that malicious or oppressive conduct on 

their part could lead to the imposition of punitive damages. 

Our decisions in First National Bank in Libby v. Twombly 
(Mont. 1984), 689 P.2d 1226, 41 St.Rep. 1948, and rib by v. 

Northwestern Bank of Great Falls (Mont. 19851, 704 P.2d 409, 

42 St.Rep. 1133, support this result. 

Appellants complain that the punitive damages are 

excessive and based upon passion or prejudice. Section 

25-11-102(5), MCA, provides that a verdict or a decision may 

be vacated and a new trial granted "on the application of the 

party aggrieved. for . . . excessive damages appearing to have 

been given under the influence of passion or prejudice." 

Appellants failed to raise the issue of excessiveness in 

post-trial motions. This Court need not now consider that 

contention on appeal. In Mitchell v. Thomas (1932), 91 Mont. 

370, 8 P.2d 639, defendant claimed damages were excessive, 

showing passion and prejudice on the part of the jury. The 

Supreme Court stated: 

A motion for a new trial was not made, and the 

trial judge was not given an opportunity to pass 

upon this feature of the case. If he had been 

asked to reduce the amount of the verdict, he might 

have done so. We have no substantial basis for 

changing it. 

91 Mont. at 383, 8 P.2d at 643. 

This Court has long adhered to the principle that "[tlhe 

amount to be awarded as damages is properly left to the jury 

and this Court will not substitute its judgment for that of 

the jury . . ." Salvail v. Great Northern Railway Co. 

(1970), 156 Mont. 12, 31, 473 P.2d 549, 560. While the 

punitive damages in this case are large, they are within the 

discretion of the jury and were not raised as error in 

post-trial motions. 

Judgment for the plaintif all respects. 
We concur: / 

ief Justice 
Mr. Justice Fred J. Weber dissents as follows: 

I dissent from that portion of Issue Six of the majority 

opinion which concludes that the punitive damages awarded in 

this case were not excessive. The jury returned the verdict 

for the plaintiff giving her economic damages of $94,170, 

emotional distress damages of $100,000 and punitive damages 

of $1,300,000. I conclude that under the factors hereafter 

described, the award of punitive damages in the amount of 

$1,300,000 was excessive. 

Section 27-1-221, MCA, contains the statutory provisions 

with regard to punitive damages. Until the 1985 amendment 

which is not pertinent in this case, that statute provided 

for the award of punitive damages where the defendant has 

been guilty of oppression, fraud, or malice, actual or presumed, and allowed the award of damages for the sake of 

example and by way of punishment. No additional factors were 

set forth. In 1927 this Court described what a jury should 

consider in setting the amount of a punitive damage award: 

"The jury should take into consideration the attendant circumstances, such as the malice or wantonness of the act, the injury intended, the motive 

for the act, the manner in which it was committed 

and the deterrent effect upon others . . . According to the general rule, ii is proper for the jury 

to-considerdefendant's wealth and pecuniary ability in fixing the amount of damages." 17 C. J. 994, 

995. . . . "The public good in the restraint of 

others from wrongdoing, as well as the punishment 

of the offender, is to be considered in estimating 

exemplary damages. " Ward v. Ward, 4 1 Iowa, 6 86. 

Based on those determinative factors and seneral 

principles, in this state the rule ----- is that the 

amount of exemplary damages -- must be reasonable. 

(~mphasis supplied) . 

Ramsbacher v. Hohman (1927), 80 Mont. 480, 489, 261 P. 273, 
In the case of Butcher v. Petranek (1979), 181 Mont. 

358, 361, 593 P.2d 743, 744, this Court restated the rule in 

Montana that a jury award of punitive damages would not be 

disturbed unless the amount, considered in connection with 

the facts, indicates the jury was influenced by passion, 

prejudice, or corruption. My research indicates that there 

is a great difference of opinion in the various states on the 

manner and extent of review of punitive damages, both by the 

trial court and the appellate court. However, I do note that 

many courts have concluded that it was appropriate to set 

aside punitive damage awards on the basis of passion and 

prejudice, or similar rationales. 

I approve the factors to be considered in reviewing 

punitive damages as set forth in Mallor and Roberts, Punitive 

Damages: Toward a Principled Approach, 31 Hastings L. J. 639 

(1980) . These factors are essentially as follows: 

1. the severity of the harm likely to occur from 

defendant's conduct; 

2. the degree of reprehensibility of defendant ' s 

conduct ; 

3. the profitability of the conduct; 

4. the financial position of the defendant; 

5. the amount of compensatory damages; 

6. the costs of litigation; 

7. potential criminal sanctions; and 

8. other civil actions against the defendant based 

on the same conduct. 

Because this is a dissent, I will not extensively analyze the facts as they apply to each of these factors. I do 

suggest that a clear contradiction is shown if we apply 

factor (5) to the present case. The amount of the compensatory damages totals $194,170. This factor alone raises a 
significant question as to the punitive damages award of 

$1,300,000. As I seek to apply the above factors in my 

review of the facts of this case including the outrageous 

conduct on the part of the defendant, I conclude that an 

award of $1,300,000 as punitive damages is excessive. 

This case tends to suggest the very real interplay which 

is possible on the jury's part with regard to the various 

categories of damages. We speak of economic damages and 

emotional distress damages as being compensatory in nature 

and different in character from punitive or exemplary damages. I'm not certain tha.t the jury made that distinction. As 

an example, had the jury not been allowed to award punitive 

damages in excess of one million dollars as was done in this 

case, the facts would seem to warrant an award for emotional 

distress in excess of $100,000. 

I would therefore reverse the judgment and remand for 

new trial so the plaintiff would have an adequate opportunity 

to recover all types of damages which she may prove.