NO. 94-451

IN THE SUPREME COURT OF THE STATE OF MONTANA

1995

RYAN FANDRICH and CATHY AVARD FANDRICH,

Plaintiffs and Appellants,

v.

CAPITAL FORD LINCOLN MERCURY, a Montana

corporation; MARK RENNERFELDT, an AUG 17 199f3

individual; DUGAN ANDERSON, an individual;

and DOES 1 through 5, inclusive,

Defendants and Respondents.

APPEAL FROM: District Court of the First Judicial District,

In and for the County of Lewis and Clark,

The Honorable Thomas C. Honzel, Judge presiding.

COUNSEL OF RECORD:

For Appellants:

Dale F. Myers, Attorney at Law,

Helena, Montana

For Respondents:

R. J. "Jim" Sewell Jr., Smith Law Firm, Helena,

Montana; Karl R. Lindegren and Robert V. Schnitz,

Fisher & Phillips, Newport Beach, California

(for Capital Ford and Dugan Anderson)

John F. Sullivan, Hughes, Kellner,

Sullivan & Alke, Helena, Montana

(for Mark Rennerfeldt)

Filed:

Submitted on Briefs: March 9, 1995

Decided: August 17, 1995
Justice Terry N. Trieweiler delivered the opinion of the Court.

The plaintiffs, Ryan and Cathy Fandrich, filed a second

amended complaint in the District Court for the First Judicial

District in Lewis and Clark County in which they alleged that they

were wrongfully discharged from their employment, and that Cathy

had been sexually harassed and assaulted, and that her basic

personal rights had been violated. The District Court dismissed

the second amended complaint, based on its conclusion that the

Montana Human Rights Act provided the Fandrichs' exclusive remedy.

The Fandrichs appeal from the judgment entered pursuant to the

order dismissing their complaint. We affirm the District Court.

The issues raised on appeal are:

1 . Did the District Court err when it dismissed Cathy

Fandrich's claims based on the exclusive remedy provision of the

Montana Human Rights Act?

2 . Did the District Court err when it dismissed Ryan

Fandrich's claim for wrongful discharge based on its conclusion

that it was barred by the exclusive remedy provision of the Montana

Human Rights Act?

FACTUAL BACKGROUND

Cathy Fandrich worked for defendant Capital Ford Lincoln

Mercury (Capital) as a warranty clerk and cashier until March 16,

1993, when she resigned. Ryan Fandrich worked for Capital as a

body shop lineman and body shop manager until July 1, 1993, when he

resigned.

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Mark Rennerfeldt was, during the time complained of, employed

by Capital as its service manager, and in that capacity supervised

the work of both Cathy and Ryan. Dugan Anderson was a principal

owner and stockholder of Capital who supervised Rennerfeldt, as

well as the Fandrichs.

Cathy alleged that she was forced to quit working at Capital

because Rennerfeldt sexually harassed her and Capital failed to do

anything about it. Ryan alleged that he was ultimately forced to

quit working for Capital because he was demoted for objecting to

Rennerfeldt's harassment of Cathy.

Neither Cathy nor Ryan filed a timely claim with the Montana

Human Rights Commission. On July 20, 1993, the Fandrichs filed

their original complaint in the District Court. On July 21, 1993,

they filed their amended complaint. On November 22, 1993, the

District Court questioned whether it had jurisdiction to consider

the amended complaint, or whether the Montana Human Rights Act

found at 55 49-l-101 through 49-4-511, MCA, was the Fandrichs'

exclusive remedy pursuant to 5 49-2-509(7), MCA. In response to

those concerns, the Fandrichs filed a second amended complaint on

May 16, 1994.

The second amended complaint contained four counts. In

Count 1, Ryan alleged that he was wrongfully discharged from

employment by Capital because he had reported Rennerfeldt's alleged

behavior to Anderson. He alleged that instead of correcting the

problem, Anderson and Rennerfeldt complained about his work,

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decreased his duties, and reduced his hours to the extent that he

could not afford to work at Capital. In count 2, Cathy alleged

that Rennerfeldt's conduct violated her personal rights. 1n

Count 3, Cathy alleged that Rennerfeldt sexually harassed her. In

count 4, Cathy alleged that Rennerfeldt assaulted her.

As a result of the alleged conduct, Ryan and Cathy claimed

they were forced to quit working at Capital. On July 15, 1994, the

District Court dismissed the Fandrichs' claims based on its

conclusion that the Montana Human Rights Act provided their

exclusive remedy.

ISSUE 1

Did the District Court err when it dismissed Cathy Fandrich's

claims based on the exclusive remedy provision of the Montana Human

Rights Act?

The Fandrichs' claims were dismissed pursuant to Rule 12(b),

M.R.Civ.P., for failure to state a claim for which relief can be

granted. A claim should only be dismissed on that basis when it

appears, based on the pleadings, that the plaintiff cannot prove

any set of facts in support of his or her claim which would entitle

the plaintiff to relief. Boreen V. Christensen (Mont. 1994), 884 P.2d

761, 762, 51 St. Rep. 1014, 1015 (citing W&on V. Taylor (19811, 194

Mont. 123, 634 P.2d 1180). The complaint should be construed in

the light most favorable to the plaintiff and all factual

allegations in a complaint are assumed to be true. Boreen, 884 P.2d

at 762. The District Court's determination that the Fandrichs'

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second amended complaint failed to state a claim is a legal

question which we review to determine whether the court ' s

interpretation of the law was correct. In re Marriage of Barnard ( 1 P P 4 ) ,

264 Mont. 103, 106, 870 P.Zd 91, 93 (citing In re Marriage of Burris

(1993), 258 Mont. 265, 269, 852 P.2d 616, 619).

The District Court concluded that, because Cathy's

allegations, if true, constituted sexual harassment at her

workplace, the Montana Human Rights Act provided her exclusive

remedy. See § 49-2-509(7), MCA; Harrisonv. Chance (1990), 244 Mont

215, 221, 797 P.2d 200, 204.

We have previously held that sexual harassment is the

equivalent of sexual discrimination which is prohibited by the

Montana Human Rights Act. Harrison, 797 P.2d at 204. Section

49-2-509(7), MCA, indicates that the Montana Human Rights Act

provides the exclusive remedy for sexual discrimination in the

workplace. That provision states:

The provisions of this chapter establish the

exclusive remedy for acts constituting an alleged

violation of this chapter, including acts that may

otherwise also constitute a violation of the

discrimination provisions of Article II, section 4, of

the Montana constitution or 49-l-102. No other claim or

request for relief based upon such acts may b e

entertained by a district court other than by the

procedures specified in this chapter.

In this case, Cathy pled sexual harassment, violation of her

personal rights, and assault based on Rennerfeldt's alleged

conduct. The plaintiff in Harrison also pled a variety of torts

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including tortious battery, intentional infliction of emotional

distress, outrage, wrongful discharge, and breach of the implied

covenant of good faith and fair dealing. 1n Harrison, we concluded

that the "gravamen of the appellant's claim [was1 sexual

harassment" because each of her claims arose from allegations of

forceful kissing, sexually explicit innuendos and offers, and

sexual harassment committed by her employer that made working

conditions intolerable. Harrison, 797 P.2d at 205. We recognized

that a claim based on sexual harassment may be framed in terms of

numerous tort theories. However, this Court stated that the

Legislature intended that the Human Rights Act be the exclusive

remedy for such conduct when it enacted § 49-2-509(7), MCA.

Harrison, 797 P.2d at 205.

Harrison did not involve a claim based on sexual harassment

committed by one employee against another. Therefore, Cathy

contends that it is inapplicable and that the scope of

§ 49-2-509 (71, MCA, is limited to direct acts by the employer.

However, in 1993, the definition of "employer," as used in the

Act, was amended to provide that:

As used in this chapter, unless the context requires

otherwise, the following definitions apply:

(8) "Emulover" means an emnlover of one or more

persons or an aaent of the emnlover but does not include

a fraternal, charitable, or religious association or

corporation if the association or corporation is not

organized either for private profit or to provide

accommodations or services that are available on a

nonmembership basis.
Section 49-2-101, MCA (1993) (emphasis added). For purposes of

this appeal, the parties have relied on the 1993 version of

§ 49-2-101(8), MCA. Therefore, without further analysis, we will

assume its applicability.

When we construe this language, we must first look to the

plain language of the statute. See Boegli v. Glacier Mountain Cheese Co.

(1989), 238 Mont. 426, 429, 777 P.2d 1303, 1305. The Legislature

added the word "agent" without specifying which employees are to be

considered agents. As a result of the Legislature's failure to

specify the meaning of agent, we adopt the ordinary meaning of the

word "agent."

A servant or employee is an agent who is employed by a master

or employer whose physical conduct is subject to control or right

to control by the master or employer. State ex rel. Eccleston v. Third Judicial

Dist. Court (1989), 240 Mont. 44, 51-52, 783 P.2d 363, 368 (citing

Restatement (Second) of Agency § 2). Thus, the ordinary meaning of

agent includes employees who are subject to an employer's control

while performing their job duties. As a result of its failure to

define agent otherwise, it appears that the Legislature intended,

for purposes of the Human Rights Act, to include an employee in the

definition of employer.

Legislative history also supports this conclusion. In 1993,

the Montana Human Rights Commission proposed House Bill 561 as an

amendment to include agent in the definition of employer. Part of

the motivation behind the bill was to allow the Commission to

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redress situations where an employee is sexually harassed by

another employee. The example provided in support of the amendment

was a case involving a woman who was sexually harassed by her

manager who was also a co-employee. The woman sought redress from

the Montana Human Rights Commission. However, because the sexual

harassment was committed by her manager and co-employee, the

Commission concluded that it was not empowered to hear her claim.

The Commission's goal was to have the ability to assign liability

to the individual responsible for the discriminatory conduct in

addition to or in place of the employer. Hearings on HB 561 Before the

House Judiciary Committee, 53rd Legislature, Regular Sess. p.4 and

Exhibit 1 (1993) (statement of Anne MacIntyre, Administrator, State

Human Rights Commission).

Based on the addition of agent to the definition of employer

in the Montana Human Rights Act, we conclude that the Montana Human

Rights Act provides Cathy's exclusive remedy for Rennerfeldt's

alleged sexual harassment.

Cathy next claims that the District Court's decision violated

Article II, Section 16, of the Montana Constitution because she was

denied her ability to seek judicial redress. However, that issue

was not raised in the District Court and we will not consider it

for the first time on appeal. We affirm the District Court's

dismissal of Cathy's claims and the judgment entered pursuant to

that order.
ISSUE 2

Did the District Court err when it dismissed Ryan Randrich's

claim for wrongful discharge based on its conclusion that it was

barred by the exclusive remedy provision of the Montana Human

Rights Act?

In Count 1 of the second amended complaint, Ryan alleged that

while he was dating Cathy he discovered that Rennerfeldt was

sexually harassing, intimidating, and assaulting her. Ryan claimed

that he complained to Anderson about the alleged conduct and

informed Anderson that Ryan and Cathy were engaged. Ryan added

that Anderson and Rennerfeldt then began to harass and intimidate

Cathy, reassigned her to a cashier's position, and ultimately

forced her to resign. Ryan alleged that he complained again, and

his employer falsely accused him of incompetent work, demoted him,

and eventually decreased his hours. He claimed that he was

constructively discharged by Capital because his employer created

and allowed a work environment which a reasonable person would find

intolerable. Ryan further alleged that the constructive discharge

was in retaliation for his threats to report Rennerfeldt's alleged

conduct to state and federal authorities. As a result, Ryan

claimed that his employer violated § 39-Z-904(2), MCA.

The District Court concluded that if Ryan's allegations were

true, Capital violated § 49-2-301, MCA, of Montana's Human Rights

Act, and that the Act's provisions were, therefore, his exclusive

remedy.
As stated previously, the Montana Human Rights Act applies to

discrimination by the employer and the employer's agents. The

Montana Human Rights Act prohibits retaliation against an employee

who opposes discrimination in the workplace. Section 49-2-301,

MCA, states:

It is an unlawful discriminatory practice for a person,

educational institution, financial institution, or

governmental entity or agency to discharge, expel,

blacklist, or otherwise discriminate against an

individual because he has opposed any practices forbidden

under this chapter or because he has filed a complaint,

testified, assisted, or participated in any manner in an

investigation or proceeding under this chapter.

Sexual harassment is the equivalent of discrimination in the

workplace. Harrison, 797 P.2d at 204. Ryan claims he was terminated

because he opposed alleged conduct which is prohibited by the Act.

Therefore, Ryan is barred from bringing his claim pursuant to the

Montana Wrongful Discharge From Employment Act because the Human

Rights Act provides his exclusive remedy. Section 49-2-509(7), MCA

(1987) . We conclude that the District Court correctly dismissed

Ryan's claim.

We affirm the judgment of the District Court.

J$stice

We concur:
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ied order was sent by United States mail, prepaid, to the

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: OF THE SUPREME COURT

OF MONTANA

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