No. 92-332 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

LEONARD E. VAINIO, as the Personal 

Representative of the Estate of 

HELEN MARIE VAINIO, 

Petitioner and Appellant, - - f C' 

v. !.. f'-& -..,,. K<. , (;IERK OF $:.J:.'&l::!aZ COURT 

S.i~~~ cc iwiu~~id~. CANDI BROOKSHIRE and THE MONTANA 

HUMAN RIGHTS COMMISSION, 

Respondents and Respondents. 

APPEAL FROM: District Court of the Second Judicial District, 

In and for the County of Silver Bow, 

The Honorable Mark P. Sullivan, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Kevin E. Vainio, Attorney at Law, 

Butte, Montana 

For Respondents: 

Leonard J. Haxby, Attorney at Law, Butte, 

Montana (Brookshire); David Rusoff, Human 

Rights Commission, Helena, Montana 

Filed: 

Submitted on Briefs: January 14, 1993 

Decided: May 13, 1993 
Justice William E. Hunt, Sr., delivered the opinion of the Court. 

Appellant Leonard Vainio, acting as personal representative of 

Helen Marie Vainio's estate, appeals the decision of the Second 

Judicial District Court, Silver Bow County, affirming the order of 

the Montana Human Rights Commission (HRC) finding that Helen 

vainio's employee/supervisor committed sexual harassment against 

respondent Candi Brookshire, and the HRC's damage award of $20,000 

to Brookshire for emotional distress. 

We affirm. 

Appellant presented 11 issues for this Court's consideration. 

We rephrase and consolidate the issues as follows: 

1. Does § 49-2-506(1)(b), MCA, of the Montana Human Rights 

Act violate the Montana Constitution because the Act's procedural 

provisions do not allow for a jury trial? 

2. Does 5 49-2-506(1) (b) , MCA, constitute an unlawful 

delegation of judicial and legislative powers? 

3. Did the District Court err in finding that Helen Vainio 

was properly notified of the complaint? 

4. Did the District Court err in finding Helen Vainio liable 

on the basis of respondeat superior? 

5. Did the District Court err in upholding the HRC's ruling 

striking part of appellant's witnesses and exhibits? 

6. Did the District Court err in holding that the Workers' 

Compensation Act does not provide a remedy for sexual harassment? 

7. Did the District Court err in affirming the HRC's award of 

$20,000 in emotional distress damages? 
8. Did the District Court err in affirming the HRC'S 

decision not to allow the HRC1s investigative report into evidence? 

On September 2, 1988, rook shire filed a complaint with the 

HRC against Harvey Phillips and the Silver Slipper, a lounge and 

casino located in Butte. On September 19, 1988, Brookshire amended 

her complaint, alleging that she was sexually harassed by Phillips 

during her employment at the silver Slipper prior to being fired on 

June 2, 1988. During the time of the sexual harassment, the Silver 

Slipper Bar was owned by Helen vainio, who is now deceased. The 

Silver Slipper has since been sold to Silver Slipper, Inc. 

On September 5, 1989, the matter was certified for hearing and 

Phillips, Brookshire, and Silver Slipper, Inc., were all properly 

served with notice. On April 12, 1990, a contested case hearing 

was held in Butte. In her findings of fact, and conclusions of 

law, and order, the hearing examiner concluded that Phillips 

unlawfully sexually harassed Brookshire and that Helena Vainio, as 

owner of the Silver Slipper, was liable for the harassment. Silver 

Slipper, Inc., was found not liable. Appellant filed exceptions 

with the HRC to the hearing examiner's findings. On March 29, 

1991, the HRC issued its order affirming the hearing examiner's 

order. Appellant appealed the HRC's opinion and order to the 

District Court. A hearing was held on December 30, 1991, and on 

May 12, 1992, the District Court issued its order affirming the 

HRC. Appellant appeals from the District Court order. 
Appellant did not file a transcript of the contested case 

hearing for this Court to review, but did provide this Court with 

a transcript of the District Court's hearing. 

I. 

Does 5 49-2-506(1)(b), MCA, of the Montana Human Rights Act 

violate the Montana Constitution because the Act's procedural 

provisions do not allow for a jury trial? 

Appellant contends 5 49-2-506(1)(b), MCA, unconstitutionally 

denied Helena Vainio's right to a jury trial. A legislature's 

enactment is presumed constitutional. Ingraham v. Champion 

International (lggO), 243 Mont. 42, 47, 793 P. 2d 769, 772. A party 

challenging the constitutionality of a statute has the burden of 

proving it unconstitutional beyond a reasonable doubt. Romero v. 

J & J Tire (1989), 238 Mont. 146, 149, 777 P.2d 292, 294. 

We have held that the Montana Human Rights Act does not 

unconstitutionally deny persons the right to a trial by jury. 

Romero, 777 P.2d at 296. Prior to enactment of the Civil Rights 

Act of 1991, which creates a statutory right to a trial by jury 

under Title VII where there is a claim for compensatory or punitive 

damages, there was no right to trial by jury under Title VII. 

Slack v. Havens (9th Cir. 1975), 522 F.2d 1091, 1094. In Romero, 

we stated that legislative bodies may assign adjudication of 

statutory rights to administrative agencies in which a jury trial 

would be incompatible without violating the Seventh Amendment. 

Romero, 777 P.2d at 296. Through its enforcement of the Human 

Rights Act, the HRC protects the State's interest in eliminating 
discrimination. Appellant failed to prove beyond a reasonable 

doubt that the administrative contested case procedures under the 

Human Rights Act unconstitutionally denied Helen Vainiots right to 

a jury trial. We hold that Helen Vainio was not unconstitutionally 

denied a jury trial. 

11. 

Does 9 49-2-506(1) (b), MCA, constitute an unlawful delegation 

of judicial and legislative powers? 

Appellant asserts that 9 49-2-506(1) (b) , MCA, which allows the 

HRC to award damages in discrimination cases, constitutes an 

unconstitutional delegation of authority by the legislature. 

Appellant asserts that the HRC has 'Iunbridled authorityu to award 

damages. Section 49-2-506(1)(b), MCA, grants the HRC the 

discretion to award tvreasonable" damages. Parties to contested 

cases before the HRC have the right to judicial review of all final 

HRC orders pursuant to 9 2-4-702, MCA. The HRC damage awards must 

be reasonable and they are reviewable in district court under an 

abuse of discretion standard. The HRC does not have unbridled 

authority to award damages. We hold that 9 49-2-506(1)(b), MCA, 

does not constitute an unlawful delegation of judicial and 

legislative powers. 

111. 

Did the District Court err in finding that Helen Vainio was a 

party to the action? 

Appellant asserts that Brookshire failed to name Helen Vainio 

in her complaint to the HRC as required by § 49-2-501(1), MCA, and 
24.9.209(2), ARM. Section 49-2-501(1), MCA, states the following 

requirements for bringing an action against a party: 

A complaint may be filed by or on behalf of any person 

claiming to be aggrieved by any discriminatory practice 

prohibited by this chapter. The complaint must be in the 

form of a written, verified complaint stating the name 

and address of the person . . . alleged to have engaged 

in the discriminatory practice and the particulars of the 

alleged discriminatory practice. 

The complaint listed Phillips and the Silver Slipper as 

respondents and stated the proper address and telephone number of 

the Silver Slipper. The complaint alleged unlawful discriminatory 

practices occurring throughout Brookshire's employment at the 

Silver Slipper. There is no requirement that a complaint filed 

under this statute name the individual owner of a business. 

Appellant also contends that Helen Vainio was not promptly 

served with Brookshire's harassment complaint. Section 49-2-504, 

MCA, requires the HRC to informally investigate discrimination 

complaints filed with the Commission. Helen Vainio was aware of 

Brookshire's complaint three months after Brookshire was fired. 

Appellant has not provided this Court with additional evidence to 

show otherwise. Helen Vainio was properly served in this instance. 

We hold that the District Court did not err in finding that Helen 

Vainio was properly notified of Brookshire's complaint and was a 

party to this action. 

IV. 

Did the District Court err in finding Helen Vainio liable on 

the basis of respondeat superior? 
Section 49-2-303(1) (a), MCA, provides that it is unlawful for 

an employer to discriminate based on sex. Unlike the comparable 

federal law, Title VII of the Civil Rights Act of 1964, the Montana 

Human Rights Act does not include an agent of the employer in the 

definition of "ernpl~yment.'~ Section 49-2-101(8), MCA; 42 U.S.C. 

5 2000e(b) (1964). In employment discrimination proceedings before 

the HRC, only the employer is potentially liable for discriminatory 

acts of its agents. The Equal Employment Opportunity Commission 

has exclusive jurisdiction under Title VII over any claim against 

a manager. Under the theory of respondeat superior, employers are 

liable for the intentional sexual harassment in which supervisory 

personnel engage in the course of their employment. E.E.O.C. v. 

Hacienda Hotel (9th Cir. 1989), 881 F.2d 1504, 1515. As a result 

of respondeat superior liability, a sexual harassment complaint 

need not specify acts committed personally by the employer. All 

that is needed to make Helen Vainio subject to the administrative 

proceeding is for Brookshire to allege that Phillips, an agent of 

Helen Vainio, committed unlawful sexual discrimination. We hold 

that the District Court did not err in concluding that Helen Vainio 

was liable on the basis of respondeat superior. 

v. 

Did the District Court err in upholding the HRC1s ruling 

striking part of appellant's witnesses and exhibits? 

Administrative Rule 24.9.317(4), permits the hearing examiner 

or HRC to limit the prosecution or defense of a contested case if 

a party fails to comply or engage in discovery. This Court has 

7 
held that the imposition of sanctions for failure to comply with 

discovery is regarded with favor. Huffine v. Boylan (1989), 239 

Mont. 515, 517, 782 P.2d 77, 78. An appropriate sanction is the 

limitation of proof to matters disclosed through discovery. Vehrs 

v. Piquette (1984), 210 Mont. 386, 393, 684 P.2d 476, 480. Any 

last minute tender of relevant documents will not cure the 

discovery problem. Dassori v. Roy Stanley Chevrolet Co. (1986), 

224 Mont. 178, 728 P.2d 430. We will not overturn a trier of fact 

decision as to the determination of an appropriate sanction absent 

an abuse of discretion. Dassori, 728 P.2d at 432. 

According to the minute entry of the hearing examiner, during 

a prehearing conference on March 21 and 22, 1990, the attorneys in 

this case were ordered to exchange their list of witnesses, 

contentions, and copies of exhibits, and revise a final prehearing 

order. Previous to this prehearing conference, appellant's counsel 

failed to participate in the preparation of the prehearing 

memorandum or file any separate addendum for the March 21, 1990, 

conference. The conference was continued to the following day to 

give appellant's counsel the opportunity to prepare his additions 

and discuss them with Brookshire's counsel. Brookshire's counsel 

did not receive appellant's witness or exhibit lists until April 9, 

1990, and did not receive copies of appellant's proposed exhibits 

until April 11, 1990. Appellant's counsel hand-delivered his 

documents to the HRC offices on Monday, April 9, 1990, at 5: 05 p.m. 

Based on appellant's failure to disclose the proper documents and 

witnesses, the hearing examiner struck the items from the final 

8 
prehearing order. We hold that the District Court did not err in 

upholding the HRC's ruling striking part of appellant's defense. 

VI . 

Did the District Court err in holding that the Workers' 

Compensation Act does not provide a remedy for sexual harassment? 

Appellant argues that Brookshire's exclusive remedy for 

damages for emotional pain and suffering is under the Workers' 

Compensation Act, and not under the Montana Human Rights Act. The 

Workers' Compensation Act provides the exclusive remedy for 

physical injuries on the job. Section 39-71-119, MCA, defines 

injuries covered by the Act. The statute provides that personal 

injuries covered by the Act include "internal or external physical 

harm to the body . . . caused by an accident.I1 Section 

39-71-119 (1) (a) and (2) , MCA. Brookshire's complaint did not 

allege internal or external physical injuries to her body. Sexual 

harassment is an intentional act not arising from an accident. We 

hold that the Workers1 Compensation Act is not an exclusive remedy 

for Brookshire1s claim. 

VII. 

Did the District Court err in affirming the HRC's award of 

$20,000 in emotional distress damages? 

Section 49-2-506(1) (b) , MCA, delineates the forms of relief 

which the HRC may order if it finds that a person has engaged in 

unlawful discriminatory practices. The order issued by the HRC 

may: 
[Rlequire anv reasonable measure to correct the 

discriminatory practice and to rectify any harm. 

pecuniary or otherwise, to the person discriminated 

against . . . . [Emphasis added.] 

Section 49-2-506 (b) (I), MCA. 

Appellant contends that the HRC's award of $20,000 for 

emotional distress was clearly erroneous. We do not agree. The 

District Court found that Phillips's conduct toward Brookshire 

included, among other things, brushing his body against her 

buttocks, putting his hand up her skirt, grabbing her breasts, and 

requesting Brookshire to have sex with him. The statute provides 

that the HRC may order any reasonable measure to correct or rectify 

any harm. This includes emotional distress damages. The HRC1s 

award of $20,000 in emotional distress damages was not clearly 

erroneous. We hold that the District Court did not err in 

upholding the HRC's award of $20,000 in emotional distress damages. 

VIII. 

Did the District Court err in affirming the HRC's decision not 

to allow the HRC's investigative report into evidence? 

Finally, appellant contends that there was evidence contained 

in the HRC's investigative file which would establish that Helen 

Vainio was not made a party to the action. As we stated 

previously, Helen Vainio was properly noticed and is a party to 

this action. 

We affirm the decision of the District Court. 
Justices 
Justice Terry N. Trieweiler, concurring in part and dissenting in 

part: 

I concur with the majority's conclusions under Issues I1 

through VIII of the majority opinion. However, because I conclude 

that compensatory damages for emotional distress are recoverable 

under 3 49-2-506(1)(b), MCA, I also conclude that either party had 

a right to demand a jury trial of that issue pursuant to 

Article 11, 5 26, of the Montana Constitution, which provides in 

part that "[tlhe right of trial by jury is secured to all and shall 

remain inviolate. " 

We have previously held that *'[t]he right to trial by jury in 

this state is the same as that guaranteed by the Seventh Amendment 

[to the United States Constitution] .'I (Citation omitted.) Linder 

v. Smith (1981), 193 Mont. 20, 23, 629 P.2d 1187, 1189. While I do 

not agree that the right to trial by jury under Montana's 

Constitution should be limited by federal interpretations of the 

United States Constitution, I conclude that even on the basis of 

those decisions, appellant had a right to a jury trial of the 

damage issue in this case. 

The majority relies on our prior decision in Romero v. J& J Tire 

(1989), 238 Mont. 146, 777 P.2d 292. However, in that case 

compensatory damages were not at issue, and the court correctly 

looked to federal case law interpreting Title VII of the Civil 

Rights Act of 1964 to determine whether a jury trial was guaranteed 

under Montana's Human Rights Act. In that case, we held that: 
This Court has stated that in discrimination cases under 

the Human Rights Act, it is helpful to look to federal 

law under Title VII of the Civil Rights Act of 1964, 

codified at 42 U.S.C. ZOOOe, et seq, Snellv.MontalzaDakota UtihiesCo. (1982), 198 Mont. 56, 62, 643 P.2d 841, 

844. . . . When Congress creates new statutory 'public 

rights,* it may assign their adjudication to an 

administrative agency with which a jury trial would be 

incompatible, without violating the Seventh Amendment's 

injunction that jury trial is to be 'preserved * in suits 

at common law.'" 

However, our holding in Romero must be reexamined for several 

reasons, First of all, compensatory or legal damages for pain and 

suffering were not an issue in Romero. Second, the federal case 

law relied upon in Romero was decided before the 1991 amendments to 

Title VII of the civil Rights Act of 1964. Prior to those 

amendments, the only relief provided for under the enforcement 

provisions of the Federal Civil Rights Act was equitable relief. 

See Cub v. Loether (1974)~ 415 U.S. 189, 94 S. ct. 1005, 39 L. ~d. 2d 

260. The District Court could enjoin the conduct complained of, 

order reinstatement of the effected employee, with or without back 

pay, or grant any other equitable relief that the court deemed 

appropriate. Curlk, 415 U.S. at 197. However, in 1991, 42 U.S.C. 

'5 1981a(a) (I) was added to the Federal Civil Rights Act to provide: 

In an action brought by a complaining party under 

section 706 or 717 of the Civil Rights Act of 1964 E42 

U.S.C. 2000e-5, 2000e-161 against a respondent who 

engaged in unlawful intentional discrimination . , . and 

provided that the complaining party cannot recover under 

section 1981 of this title, the complaining party may 

recover compensatory and punitive damages as allowed in 

subsection (b) of this section, in addition to any relief 
authorized by section 706(g) of the Civil Rights Act of 

1964 [42 U.S.C. 2000e-5(g), 2000e-163, from the 

respondent. 

When the Act was amended to allow for compensatory or punitive 

damages, it was also amended to provide that: 

If a complaining party seeks compensatory or 

punitive damages under this section -- 

(1) any party may demand a trial by jury . . . . 

42 U.S.C. I 1981a(c) (1991). 

Because the Federal Civil Rights Act did not provide for 

general compensatory damages prior to 1991, the federal cases 

decided prior to the amendment that were relied upon by the 

majority are no longer instructive, A more helpful decision on 

this issue is the United States Supreme Court's decision in Cub. 

In that case, the Supreme Court was asked to decide whether parties 

had a right under the Seventh Amendment to trial by jury of claims 

brought pursuant to Title VIII of the Civil Rights Act of 1968 (42 

U.S.C. 5 3612 (1968)). The fair housing provisions of that Act 

allowed federal courts to grant relief, including actual damages 

and punitive damages. In that case, the petitioner sought actual 

and punitive damages based on her allegation that the respondents 

had refused to rent an apartment to her because of her race. 

Respondents made a timely demand for jury trial. However, the 

district court held that a jury trial was not authorized under 

Title VIII of the Civil Rights Act, and neither was it required by 

the Seventh Amendment. The Seventh Circuit Court of Appeals 

reversed on the issue of respondents' right to a trial by jury, and 

the Supreme Court affirmed. In doing so, the Court held that: 
But when Congress provides for enforcement of statutory 

rights in an ordinary civil action in the district 

courts, where there is obviously no functional 

justification for denying the jury trial right, a jury 

trial must be available if the action involves rights and 

remedies of the sort typically enforced in an action at 

law. 

We think it is clear that a damages action under 

5 812 is an action to enforce "legal rights1I within the 

meaning of our Seventh Amendment decisions. See, e.g., 

Rossv. Bemhard, [396 u.S. 531,] 533, 542; Dairy Queen, Inc. v. 

Wood, [369 U.S. 469,] 476-477. A damages action under 

the statute sounds basically in tort--the statute merely 

defines a new legal duty, and authorizes the courts to 

compensate a plaintiff for the injury caused by the 

defendant's wrongful breach. As the Court of Appeals 

noted, this cause of action is analogous to a number of 

tort actions recognized at common law. 

More important, the relief sought here--actual and 

punitive damages--is the traditional form of relief 

offered in the courts of law. 

Curtis, 415 U.S. at 195. 

The Court then went on to distinguish between actions brought 

pursuant to Title VIII, which provided for actual and punitive 

damages, and actions brought pursuant to Title VII, which at that 

time allowed only reinstatement and back pay which the Court 

characterized as equitable remedies. 

As in Curtis, the rights enforced by Brookshire in this case 

were ultimately enforceable in a court of law. See 49-2-505(4), 

MCA; 5 49-2-508, MCA; § 49-2-509 (1) (a) and (b) , (3), (5) and (6), 

MCA . 

This issue has been previously decided by the State of Alaska 

in Loomis Electronics Protection, Inc. v. Schaefer (Ala. 1976) , 549 P. 2d 1341. 

In that case, Schaefer sued Loomis for discriminatory hiring 

practices. Loomis moved for a jury trial, which was denied. The 
Alaska Supreme Court observed that tie constitutional guarantee of 

trial by jury in Alaska was similar to that found in the Seventh 

Amendment to the Constitution of the United States. Furthermore, 

it found that the statutory prohibition against discriminatory 

hiring practices in Alaska was similar to Title VII of the Civil 

Rights Act of 1964. It acknowledged that federal cases at that 

time had concluded that the relief provided for under Title VII of 

the Federal Act was equitable in nature and that there was, 

therefore, no right under the United States Constitution to trial 

by jury of those claims. However, it distinguished the Alaska 

statute in the following manner, which is relevant to this case: 

Title VII of the Federal Act contemplates On@ equitable 

relief. No such limitation is found in the language of 

AS 22.10.020 (c) . After authorizing the superior court to 

enjoin illegal activities, through the application of its 

traditional powers of equity, the legislature of Alaska 

went on to authorize the court to order any other relief; 

including thepayment of money. The language of the statute is 

clearly intended to provide a litigant complete relief in 

an appropriate case. . . . We believe the broad language 

of AS 22.10.020(c) indicates a legislative intent to 

authorize an award of compensatory and punitive damages 

for violations of AS 18.80, in addition to the equitable 

remedies such as enjoining illegal employment activities 

and ordering back pay as a form of restitution. 

After discussing the U.S. Supreme Court's decision in Curtis, 

the Alaska Supreme Court went on to conclude that: 

Similarly, in the instant case, where part of the 

relief sought is compensatory and punitive damages, we 

believe that Article I, 5 16, of the Constitution of 

Alaska, guarantees the parties the right to a jury trial. 

Accordingly, the order of the superior court, striking 

petitioner's demand for a trial by jury, should not have 

been entered. 
Likewise, the damages authorized by § 49-2-506(1) (b) , MCA, and 

awarded in this case are the traditional form of relief offered in 

courts of law. Whether claiming such damages or defending against 

a claim for damages, the Montana Constitution, in Article 11, 26, 

and the Seventh Amendment to the United States Constitution, 

guarantee the right of either party to trial by jury. If such a 

fundamental constitutional right can be evaded by simply delegating 

the initial determination of such damages to a state agency other 

than a district court, then the constitutional right to trial by 

jury is rendered meaningless. And, if the right to trial by jury 

is rendered meaningless for the employer in this case, then no 

one's right to trial by jury is secure from legislative 

interference in the future. This result was never intended by the 

authors of the Montana Constitution, nor the founding fathers when 

they drafted the Bill of Rights to the United States Constitution. 

The right to trial by jury is the most fundamental protection 

in our state and in our country against tyranny by judges, 

legislators, bureaucrats, and other governmental officials. I 

conclude that, under the facts in this case, appellant was denied 

that constitutional right and that Brookshire's claim, while 

otherwise fully supported by the record, should be remanded for a 

jury trial on the issue of compensatory damages. 

I Il / Justice 
May 13, 1993 

CERTIFICATE OF SERVICE 

I hereby certify that the following order was sent by United States mail, prepaid, to the 

following named: 

KEVIN E. VAIN10 

Attorney at Law 

27 West Park Street 

Butte, MT 59701 

Leonard J. Haxby 

Attorney at Law 

P.O. Box 3008 

Butte, MT 59702-3008 

DAVID M. RUSOFF 

Human Rights Commission 

P.O. Box 1728 

Helena, MT 59624 

ED SMITH 

CLERK OF THE SUPREME COURT 

STATE ,PF MONTANb