### No. 84-181 

### INTHE SUPREME COURT OF THE STATE OF MONTANA 1986



### CHARLESF. FEMLING, PlaintiffandAppellant,

MONTANA STATE UNIVERSITY, an agency of the State ofMontana, et al., Defendant and Respondent.

APPEAL FROM: District Court of theEighteenth JudicialDistrict, In and for the County ofGallatin, TheHonorableJosephGary,Judgepresiding.

COUNSEL OF RECORD:

ForAppellant: Ted 

### J. Doney argued, Helena,Montana For Respondent: 

### LeRoy 

### H. Schramrnargued,Office of Commissioner of Higher Education,Helena,Montana RogerN. Flair,Montana State University,Rozeman, Plontana

- 

### %ibmitted: October 22, 1985 

### Decided: February 7, 1986 

## Fktr 

# - Filed: --



### Clerk

### Mr. JusticeFred J. 

### Weber delivered the Opinion of the Court. Charles F. 

### Femling appeals froman order of the Gallatin County District Court which dismissed his complaint for veterans' preference in hiring. We affirm the order of the DistrictCourt. The issues raised on appeal are: 1. Did the retroactive repeal of the Montana veteran's preference statutes (hereinafter, the repealer) deprive Mr. Femling of an accrued cause of action inviolation of the due process clauses of the Montana and United States Constitutions? 2. 

### Did the repealer depriveMr. Femling of a remedy for

an injury in violation of art. 11, sec. 16, 

### Mont. Const.? 3. 

### Did the repealer deprive the courts of jurisdiction inviolationof the doctrineof separationofpowers? 4. Did the repealerprovide for sovereign immunity from accrued causes of action without a vote of two-thirds of the members of each house as required by art. 11, 

### sec. 18,Mont. Const.? 5. 

### Did the repealer violate art. 11, see. 35, Mont. Const. and the due process clauses of the Montana and United States Constitutions by retroactively depriving Mr. Femling of a

### vested right and entitlement to be employed? Charles Femling applied in August, 1983 for a position at Montana State University (MSU). He claimed entitlement to the then statutoryveterans' preference in employment butwas not interviewed for the job. A 

### nonveteranwas hired. On December 19, 1983, 

### Femling petitioned the District Court for an order for MSU to show cause why he should not be employed and given lost wages and benefits. His amended petition set forth his qualifications for the position for which he applied, and alleged that he was a qualified applicant,that hewas 

### aveteran, thathe was not hired, that

### he was physicall-yand mentally qualified for the job, and that he possessed the business capacity, competency, and education to discharge the duties of the position. On December 20, 1983, 

### the day after Femling filed his petition, the Governor signed the repealer, which retroactively extinguished pending claims forviolations of the former law. MSU moved fordismissalbased upon the new law. Femling argued to the District Court that the new law was unconstitutional on several grounds. He asserted that the

new law denied his constitutional rights to access to the courts, due process and equal protection. In addition, he asserted that the law was unconstitutional in that it impaired obligations of contract, provided immunity to the State without a required two-thirds vote of both houses, and violated the veterans' preference section of the Montana Constitution. He also claimed the new law was illegal because the bill addressed more than one subject and was altered to change its purpose during the Special Session. MSU also moved for dismissal of Femling's petition on the ground that it failed to 

### state a claim on which relief could be granted. MSU argued the new veterans' preference statute constituted a

### valid repealof the old laws. The District Court granted MSU's motion and dismissed Femling's petition with prejudice. The District Court held that:

### (1) 

### The veterans' preference under the old Montana statutewas a gratuity. (2) The gratuityhad notvested. (3) A 

### gratuity may be repealed by the Legislature. (4) 

### The legislaturecould abrogateMr. Femlings's cause of action against the State. (5) 

### MSU 

### is exempt from the preference by legislative enactment.From thisorder, Mr. Femling appeals.

Did therepealer depriveMr. Femling of an accrued cause of action in violation of the due process clauses of the Montana and United StatesConstitutions? In Crabtree v. Montana State Library (Mont. 1983)

## , 665 P.2d 231, 40 St.Rep. 963, this Court determined that the statutory veterans' preference in employment was absolute. In response to the Crabtree decision, the 1983 Special Session Legislature retroactively repealed the absolute preference a.nd enacted a tie-breaker preference. The repealer states: This repeal applies retroactively tobar any claim of violation orapplication of 10-2-201 through 10-2-206 that has not been reduced tojudgment, whether ornot the judgment is final, on [theeffective dateof thisact]. Claims under 10-2-201 through 10-2-206 that have been reduced tojudgment, whether or not thejudgment is final, on [theeffective date of this act] areenforceable. Section 14, Ch. 1, Sp. L. Mont. 1983, set out in the Compiler's Comments to Sections 10-2-201 through 10-2-206, MCA, which were repealed in 1985. Atthe time of the Special Session, approximately fourteen lawsuitswerepending aga-inst the State for allegedviolation of theabsolutepreference in employment. The legislative history of the repealer "shows that the legislaturewas unequivocal inits aim tobar those pending claims." Nick v. Montana Dept. of Hywys. (Mont. 19851, 

### -P.2d 

### - 

## , 42 St.Rep. 1926. The fourteenth amendment to the United States Constitution and art. 11, sec. 17, in the Montana Constitution provide that the Statemay not deprive a person of life, liberty or property without due process of law. Femling assertsthat hiscause of action againstMSU for failure to hire and violation of the preference statute

### accrued when the University hired a nonveteran. He argues that cause of action became a vested property right upon the filing of his complaint. He contends that the legislature could not repeal the lawwithout substituting another remedy to protect his vested right to the absolute preference in employment. "A citizen can have no vested right in a general law which can preclude its amendment or repeal, and there is no implied promise on the part of the state to protect its citizens against incidental injury occasioned by changes in the law." Stanford

### v. Coram (1903),28 Mont. 288, 293, 72 P. 655, 656. As we noted in Conboy v. State (Mont. 1985), 693 P.2d 547, 42St.Rep. 120,

### aveteran acting under the absolute veterans' preference statute did so in contemplation of the legislature's power of repeal. Statutes may be replaced at any time, and a person acting under a 

### statue is "deemed to have acted in contemplation of this power of repeal." Section 1-2-110,MCA. 

### For substantive due process protections to apply, Femling's claim to the absolute preference must be a vested right. In Conboy,we stated that the preference statutewas

a 

### gratuity given toveterans by the State. Itdid not amount to a right vested in the veterans. Conboy, 693 P.2d at 552. We reaffirmed this conclusion in Nick v. Montana Dept. of Hywys. (Mont1985), 

### -P.2d 

### - 

## , 42 St.Rep. 1926. A veteran does not have a reliance interest in the veterans' preference unless and until it is actually received. Nick, 42 St.Rep. at 1930. 

### "[B] 

### enefits conferred by gratuities may be 

# . . . withdrawn at any time 

# . . ." Lynch 

### v. United States (1934), 292 U.S. 571.,577. The Ninth Circuit Court of Appeals has characterized a 

### claim to an unreceived gratuity as a 

### "floating expectancy":[FJ]hatever anticipations a serviceman entertained 

# . . with respect to preferential advantage in the federal civil service were no more than some floating expectancy entirely dependent upon the government's bounty. A claimof unconstitutional deprivation cannot be builtupon this foundation. Monaco v. United States (9th Cir. 19751, 523 F-2d 935, 940, cert. den. 424 U.S. 914. 

## -- The giving of a government gratuity does not change the nature of the gratuity. The giving of a veterans' preference in employment does not cause that preference to become a private vested right. We conclude that the filingof a claim to a government gratuity does not change that gratuity into a vested right. Mr. Femling's claim to and expectancy of a veterans' preference do not transform a gratuity into a protectable, vested right. We hold that the repeal of the preference gratuity and dismissal of Mr. Femling's claim to that gratuity did not violate the due process clauses of the Montana and United StatesConstitutions.

Did the repealer deprive Mr. Femling of a remedy for an injury inviolationof art. 11, sec. 16, Mont. Const.? Article 11, sec. 16, Mont. Const. provides inpertinent part: Courts of justice shall be open toevery person, and speedy remedy afforded for every injury of person, property, or character. In order for art. 11, sec. 16toapply, theremust have been

an "injury of person, property or character.

### " As stated in White v. State (lilont. 1983), 661 P.2d 1272, 1275, 40 St.Rep. 507, 510: "The language 

### 'every in jury

## ' embraces all recognized.cornpensable components of injury

# . .

# ."The veterans' preference statutes were and are enforceable by court order reopening the selection process. Sections 10-2-206, MCA (1981) and 10-2-226, MCA (1985). Neither the statutory law nor the common law has ever recognized violation of the preference statutes as compensable in money damages. Jensen 

### v. State, Dept. of Labor and Industry (Mont. 1984), 689 P.2d 1231, 1234-35, 41 St.Rep. 1971, 1976. We conclude that violation of the preference statute does not result in a compensable injurywithin the meaning of art. 11, sec. 16,Mont. Const. Therefore, the repeal of the preference statute did not deprive Mr. Femling of a remedy for an injury. We hold that the repeal of the preference statutedid not violate art. 11, sec. 16,Mont. Const. 111. Did the repealer deprive the courts of jurisdiction in violation of the doctrine of separationofpowers? Mr. Femling contends tha-tthe doctrine of separation of powers prohibits the legislature fromdepriving the courts of jurisdiction over an action which has alreadybeen filed. He contends that the repealer has unlawfully deprived the District Court of jurisdiction over this case. MSU argues that this Court has acknowledged that a statute may wipe out pending causes of action. Continental Oil Co. v. Montana Concrete Co. (1922), 63 Mont. 223, 207 P. 116. MSU also argues that the bill repealing the Montana preference statute

was drafted without reference to court jurisdiction,properly leaving interpretationof tha-tissue to the courts. Mr. Femling has acknowledged that this issue was not raised before the DistrictCourt. Because itwas not raised below, we will not consider it on appeal. Dodd 

### v. City of East Helena (1979), 180 Mont. 518, 523, 591 P.2d 241, 244.IV. Did the repealer provide for sovereign immunity from accrued causes of action without a vote of two-thirds of the members of each house as required by art. 11, sec. 18,Mont. Const.? This issue has been decided in two previous cases. The legislature could repeal the veterans' preference by a majority vote at any time. Conboy, 693 P.2d at 552;Nick, 42 St-Rep.at 1933. The repealer does not provide for sovereign immunity. It simpl-yrevokes a gratuity. We reaffirm our holding that the legislatureproperly repealed the veterans' preference. 

### v. Did the repealer violate art. 11, sec. 35,Mont. Const. and the due process clauses of the Montana and United States Constitutions by retroactively depriving Mr. Femling of a vested right and entitlement to be employed? Art. 11, sec. 35,Mont. Const. provides: 

### The people declare that Montana servicemen, servicewomen, and veterans may be given special considerationsdetermined by the legislature. As we discussed under issue one, the fourteenth amendment to the United States Constitution and art. 11, sec. 17, in the Montana Constitutionprovide that the statemay not deprive a person of life, liberty, or property without due process of law. This issue, whichwe find nearly identical to issue one,

was addressed in both Conboy and Nick. We have held that the veterans' preference was a government gratuity, and not a right vested in the veterans, Conboy, 633 P.2d at 552. We have also held that art. 11, sec. 35, Mont. Const. is a permissive provision, and does not provide an independent ground for finding that theveterans' preference ismore than

a gratuity. Nick, 42 St.Rep. at 931. Recause the preferenceis a gratuity, and not a life, liberty, or property right, the repealer does not violate the due process clause of either the State or the FederalConstitution,and it does not depriveMr. Femling of a right or entitlement to be employed. The District Court's order granting MSU's motion to dismiss is therefore affirmed.

We concur: 

### /



## &q.*/,4~2 Hbn. Thomas

### M. McKStrick, district Judge,

## sitting inplace of Mr. JusticeWm. E. Hunt, Sr.

Nr. Justice Frank B. :lorrison,Jr. : As the issuesare framed, Iconcur in the result. However, Ido not agree with a t is said in themajority opinion.Mr. Justice John C. Sheehy,dissenting:

Idissent. We should not approve on any ground an outright refusal of state employees in managerial position to flout the applicable statutory law. At the time Femling applied for state employment at the University, he had a statutory right to preference, which he claimed. His right to that employment became vested with his claim for preference. The statute granting veterans' preference should have been then obeyed. An accrued sta-tutoryright of action is a vested right and 

### is to be protected. Stucki 17. Loveland (19 )

## , 94 Idaho 621, 495 P.2d 571, 573. Giving retroactive effect to the repeal of section 10-2-203, MCA deprives Femling of a-n accrued statutory right. It was no longer a possible gratuity, once he established his claim and right to the gratuity. His preference vested, but is now stripped away. Iwould reverse with instructionsto accord him his rights as

aveteran.