### No. 83-471 

### INTHE SUPREME COURT OF THE STATEOF MONTANA 1984



### CARSON H.VEHRS, JR., Plaintiff and Appellant,

JOHN PIQUETTE,GEORGE H. MITCHELL, et al., Defendants and Respondents.

APPEAL FROM: District Court of the Fourth Judicial District, Inand for the County of Missoula, TheHonorableJamesB. Wheelis,Judgepresiding.

COUNSEL OF RECORD: For Appellant: Moses LawFirm;Charles F.bloses argued, Billings, Flontana For Respondents: Boone,Karlberg 8, 

### Haddon;Sam Haddon argued for Piquette, Missoula,Montana Johnson 8, 

### Johnson;Larry Johnsonargued for Piquette, Hamilton, Montana Dexter Delaney argued forMitchell,blissoula, Montana

Submitted: April 19, 1984 

### Decided: June 8, 1984Mr. Chief Justice Frank I. Haswell delivered the Opinion of the Court. Plaintiff Carson Vehrs appeals an order of theMissoula County District Court granting defendants summary judgment dismissing his malicious prosecution suit. The order has been certified to thisCourtunder Rule 54(b), M.R.Civ.P., as

a final judgment. We affirm. Vehrs's present action and appeal arose out of events transpiring when Vehrs was food service director at the University of Montana in 1977-1978. Vehrs engaged in questionable accounting practices and use of petty cash received by the food service department. Allegedly, Vehrs diverted concession revenue to a cash travel fund, colluded with a meat supplier to bill the cost of a staff luncheon to the food serviceasmeat supplied to the University,used University equipment and food stuffs for private wine tasting parties and resold wine purchased for these parties to participants without a liquor license. The above allegations led to an internal investigation of Vehrs

### 's handling of University funds. This investigation

was initiated by an employee of Vehrs, John Piquette, and conducted by University counsel, George Mitchell. These individualsand thepresident of theUniversity at that time, Richard Rowers, are named defendants in this action and respondentson appeal. Results of the internal investigation were forwarded to the Legislative Auditor and, in turn, to theAttorney General and County Attorney. Reviewing the information provided by respondents,Missoula CountyAttorney Robert Deschamps decided toprosecuteVehrs. The original information filed March 13, 

### 1978, alleged three criminal counts: (1) felony theft; (2) officialmisconduct; and, (3) felony sale of alcoholic beverages without a license. On the first charge, a jury acquitted Vehrs of felony theft for his involvement with the cash travel fund and a lesser included offense of official misconduct arising out of the same facts. The second count of felony official misconduct (arising out of the alleged false meat bill Vehrs submitted) and the third count were dismissed by the trial court at the request of the County Attorney. This request was made in conjunction with a plea bargaining agreement wherebyVehrs pled guilty tomisdemeanor sale of alcohol without a license and the State agreed to drop the other charges. Vehrs retained counsel in these matters and incurred legal fees of $49,239.05. Vehrs filed the present complaint on February 27, 1981. The complaint consisted of four counts. The first count alleged a right of recovery of attorney fees based on statute, section 2-9-305, MCA. This count was dismissed by the trial court as barred by the two-year period of lirni-tations of section 27-2-211,MCA. Thedismissalof this count isnot being appealed. Count I1 alleges a right of recovery of attorney fees based on Vehrs's employment contract, and Count I11 seeks recovery based on a "policy" of reimbursement. Count IV alleges that the named defendants are accountable for the malicious prosecution ofVehrs. Affidavits and interrogatories were filed with the court supportingVehrs's allegations. Missoula CountyAttorney Deschamps filed an affidavit in which he stated the investigation of the County Attorney's office was "conducted independent of the investigation previously carried out by the University of Montana." The affidavit also stated that the investigation was not participated in or controlled byany University employee: "Thedecision to prosecute Carson H. Vehrs was one arrived at by the Departmentof Justice and.my office,andwasbased upon our independent investigation. No employee of the University of Monta.na caused the criminal proceedings tobe instituted." In June and July of 1983,motions for summary judgment

were filed by defendants seeking dismissal of Counts 11, I11 and.IV ofVehrs's complaint. By order of the District Court dated July 19, 1983, partial summary judgment as to Count IV was granted and denied as to Counts I1 and 111. The court ordered that defendants Piquette,Mitchell and Bower be dismissed from the proceeding and plaintiff Vehrs be limited at trial on Counts I1 and 111 to proof established by documents previously produced by d-iscoveryor readily accessible to both parties. Vehrs appeals the dismissal of his malicious prosecution suitand the limitation ofproof placed onhis remaining claims.

The trial court dismissed the malicious prosecution claim as the evidence and affidavits failed to demonstrate proof of all the recognized elements of malicious prosecution. These elementsare set forth in Reecev. PierceFlooring (Mont. 1981), 634 P.2d 640, 38 St.Rep. 1655, and both parties agree that these criteria control. The six elements

are: (1) a judicial proceeding was commenced and prosecuted against the plaintiff; (2) the defendant was responsible for instigating, prosecuting or continuing suchproceeding; (3) therewas lack of probable cause for defendant's acts;(4) defendant was actuated by malice; (5) the judicial proceeding terminated favorably forplaintiff; and, (6) theplaintiff sufferedda-mage. We hold thatVehrs failed topresent aprima facie case of malicious prosecution as the University defendants, Piquette, Mitchell and Bowers, were not responsible for instigating, prosecuting or continuing Vehrs's prosecution. Add.itionally,the proceedingsdid not terminate favora.blyfor Vehrs.Counsel for Vehrs contended that there were genuine issues of materia.1 fact present and summary judgment was therefore improper. For instance, in his affidavit Vehrs alleges that Mitchell and Bowers forwarded results of their investigation to the Legislative Auditor without accepting recommendations by the University internal auditor that no outside action be taken. Vehrs alleges this caused the filing of the information and of prosecution. Appellant's arguments are without merit. First, the bald assertion in an affidavit that defendants caused the malicious prosecution of plaintiff does not raise a genuine issue as to who was responsible for the initiation of the prosecution. Conclusionary or speculative statements are insufficient to raise a genuine issue of material fact. Fauerso v. Maronick Construction Co. (Mont. 1983), 661 ~.2d

Second, the University defendants in furnishing information to the LegislativeAuditor were fulfilling a statutory duty. Section 5-13-309(3), MCA,provides: "The head of each state agency shall immediately notify both the attorney general and the legislative auditor in writing upon the discovery of any theft, actual or suspected, involving statemoneys or property under his control or for which he is responsible." By the time defendants forwarded their investigation to the auditor, Vehrs's own admissions ha.d raised a suspicion of theft. Our opinion inWheeler v. Moe (1973)

## , 163 Mont. 154, 515 P.2d 679,addresses the situation: "It is the duty of defenda.ntsto enforce the 1a.w~ of the StateofMontana.. Defendants cannotbe held accountable in civil liability for carrying out this official duty within the authority and. means prescribedby law. Plaintiff's complaint alleges nothing more than the defendants acted within their duties and authority and pursuant to law." 163Mont. at 163, 515 P.2d at 684. Finally, the decision to prosecute came from the Missoula County Attorney's office. All respondents did was furnish information to the prosecutor. The act of providing information to authorities without more is not actionable. See, Rose v. Whitbeck (1977), 277 Or. 803, 562 ~.2d 194; Restatement (Second) of Torts,$5 653,comment g (1977). A second essential element required by Reece is lacking: the criminal proceedings did not terminate favorably for Vehrs. The facts show a single investigationwas forwarded to the proper authorities. These authoritiesdecided how to charge Vehrs. The end result was that Vehrs was acquitted of one count and plea bargained his way out of the two other counts by pleading guilty to a criminal charge arising from the same investigation. Examining the entire circumstances, Vehrs cannot be heard.now to claim the proceedings terminated inhis favor. A proceeding that terminates indecisively because of a settlement or plea negotiation agreement does not meet the requirements of a cause of action formal.iciousprosecution. Restatement (Second) of Torts, S 660 (1977)

# . In Joiner v. Benton Community Ba.nk (1980), 82 I11.2d 40, 411 N.E.2d 229,the Illinois Supreme Court held that a malicious prosecution action is barred if it is predicated upon an action that did not conclusively show the innocence of the accused. In Joiner the plaintiff had been previously indicted for theft, but the action was dismissed when full restitution had been made. The decision isprocedurally analogous to the case at bar as the Illinois trial court dismissed the plaintiff's malicious prosecution suit by granting defendant summary jud-gment. The Supreme Court affirmed and noted that summary judgmentwas ameans of disposing of cases which did nothave any factualdisputes. Similarly, in Mondrow v. Selwyn (1980), 172N.J.Super. 379, 412A.2d 447,an appellate court of New Jersey found an indecisive termination did not support a malicious prosecution cause of action. The plaintiff in Mondrow was charged with assault, but the charge was withdrawn pursuant to an agreement between the parties' attorneys. This outcome was held not to be sufficiently favorable to constitute malicious prosecution. In Mondrow, as in this case, the prosecution dropped one charge and replaced it with another arising out of the same factual situation. TheNew Jersey court commented that the defendant should not be placed in peril of civil liability for an improper charge selection when the police

were involved in filing the complaint. The reasoning of these jurisdictions ispersuasive and

canbe applied to the present situation. TheMissoula County Attorney's office decided how to initially charge Vehrs. Defendants cannot be held accountable for the particular charges filed. The investigation and.subsequent prosecution must be viewed in its entirety. Where three charges are made, the defendant is acquitted of one, two are dismissed pursuant to aplea agreement,and a guilty plea is entered toa substituted charge, the prosecution cannotbe said.to have terminated favorably for thedefendant. For the foregoing reasons, Vehrs failed to establish the prima facieelements of maliciousprosecution. Therewas no factual dispute as to who initia.tedthe prosecution and its unfavorable outcome. The summary judgment was properly granted; we' need not decide whether the Reece elements of probable causeor malice were present.

The second issue before this Court is whether the District Court properly limi.ted the plaintiff

### 's proof on remaining counts to evidence contained indiscovery documents and documents readily accessible to both parties. Judge Wheelis issued this limitation order upon motion of defendants' attorneys. The rationaleexpressed by the trial judge in the order was that this was "in keeping with Montana's strict position on discovery--as set forth in Owen v. F. A. Buttrey Co. [(Mont. 1981), 627 P.2d 1233, 38 St.Rep. 7141." The abuse of discovery precipitating this order included late filing of interrogatories, unverified answers and incomplete responses. Vehrs's counsel was served with two sets of interrogatories May 13, 1983. Answers were not returned within the thirty-day time period set forthby Rule 33(a),M.R.Civ.P. The answers were filed late on June 21, 1983. When they were returned, the answers were not signed by Vehrs, thepartymaking them--a furtherderogation of Rule 33(a). Finally,the interrogatories were not fully answered. Numerous answers were nonresponsive; appellant objected that the informationwas a.lreadyknown or available todefendants. Reference was made in the District Court order to our decision in Owen 

### v. F. A. Buttrey Co., supra. Owen was aproducts liability case in which the defendant, cosmetic manufacturer Revson, repeatedly failed to respond to discovery requests. The Missoula County District Court issued several ordersto Revson to answer questions concerningprior knowledge of allergic reactions by its customers. Finally Judge Wheelis ordered Revson's answers to admissions be stricken, and the companywas deemed to have prior knowledge that the product was defectively designed. A judgment in favorof the consumer plaintiff resulted. Appellant argues that this case isdistinguishable from the Owen situation. In Owen there were specific orders by the court compelling discovery issued to the defendant cosmetic manufacturer. Only after these orderswere ignored and

a hearingwasheld,did the District Court invoke the discovery sa-nctionsof Rule 37, M.R.Civ.P. Specifically, it is argued that Rule 37(b) provides that a party must fail to obey a court order compell-inganswers before the party not answering canbe sanctioned. Here, therewas no order issued prior to the limitation being placed on allowable proof at trial. Appellant fails to recognize that Rule 37(d)

## , not 37(h), was the basis of our decision in Owen affirming Judge Wheelis' discovery sanction in that case. Rule 37(d), M.R.Civ.P., addresses a "failure of party to attend at own deposition or serve answers to interrogatories or respond to request for inspection." The ruleprovides that theDistrict Court "may make such orders in regard to the failure as are just 

# . . ." Certain sanctions are specifically enumerated including a prohibition against introducing certain evidence at trial. Rule 37(d), M.R.Civ.P., and Owen control disposition of this case. The District Court was acting well within theconfines of its discretion when it imposed the discovery sanctions at issue. Respondents filed.their motion requesting the discovery limitation because they felt appellantwas attempting to withhold information. They felt their cause would be prejudiced if appellantwas allowed to surprise them at trial with evidence of damages and the contractual hasis of Vehrs's reimbursement claim. It was the interrogatory answers addressing these areas thatwere nonresponsive. Recognizably the facts of this case do not rise to the level of abuse present in Owen or other landmark cases in which sanctions of Rule 37 have been invoked. See,National Hockey League v. Metro. Hockey Club, Inc. (1976), 427 U.S. 639, 96 S.Ct. 2778, 49 L.Ed.2d 747. However, all the trial judge did here was limit proof at trial tomatters which had been disclosed through discovery. Themore draconian step of deeming certain matters admitted by Vehrs was not taken. The sanction was well-tailored to the discovery abuse present. The trial of this case has been limited to facts disclosed, as opposed to factswithheld. The result is equitable in that the limitation was brought about by the actions of Vehrs and his attorney in responding to discovery. The decision is affirmed.

# 3!&4*

# gw& Chief JusticeWe concur: