NO. 92-547 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

SISTER MARY JO McDONALD, REVEREND 

JOHN M. KADING, JOSEPHINE E. McWNALD 

HELEN WHERRY. ORABELLE EVANS. B. 

MADDEN, DALE ' and SUE RAWLINGS , VIRGINIA WALKER, PHILOMENA 

MICHALSKY, MAURICE H. ROTH, JAMES 

McDQNALD, JANET R. LINDH, GERALDINE 

CHRISTIAENS, JAMES and SHARON WILLIAMS, 

JOHN and J.C. McELHENNY, R.A. and IRENE 

BOKSICH, JAMES SHEA, BETTY L. BORCHERT, 

PRISCILLA BORCHERT, RONALD and RANAE 

BORCHERT, FRANCES ALTMAN, BOB MOODRY, 

CHARLES E. REED, JUANITA and DAVID 

MONGER, SHARON VINWW, RICHARD ALCORN, 

DAN DOLAN, LYNN RECKAS, RANDY and 

SHIRLEY WINSTEAD, TOM TRACY, JOE VAN HEEL, 

and all others similarly situated, 

Plaintiffs/Appellants, 

DENNIS R= WaSHINCJTON: and THE 

WATER COMPANY, a New Jersey Corporation, 

Defendants/Respondent. 

APPEAL FROM: District Court of the Second Judicial District, 

In and for the County of Silver Bow, 

The Honorable Thomas A. Olson, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

James H. Goetz, Goetz, Madden & Dunn, Bozeman, 

Montana; Martin R. Studer, Bozeman, Montana 

For Respondent: 

Ronald B. MacDonald, Datsopoulos, MacDonald & Lind, 

Missoula. Montana 

Filed: 

Submitted: September 9, 1993 

, Decided: November 4, 1993 , , 
Justice James C. Nelson delivered the Opinion of the Court. 

This is an interlocutory appeal in a class action lawsuit from 

the Second Judicial District Court, Silver Bow County. We affirm 

in part and reverse in part. 

The appellants are past and present "consumers" of water 

provided by the Butte Water Company (BWC). The respondents are 

Dennis Washington, who became the sole shareholder of BWC in 1985, 

and the former owners of the BWC. 

We restate the issues on appeal and cross-appeal: 

I. Did the District Court err in defining the class to include 

water consumers who were billed for water service but exclude 

those who were not? 

2. Did the District Court err in designating this lawsuit as 

a class action? 

3. If this matter is classified as a class action, did the 

District Court err in the construct of the Notice? 

The complaint states that appellants in the present action are 

residents of Butte, Montana, who rely on water from the BWC for 

their residential, commercial, institutional and public usage. 

Appellants claim injury from BWC's failure to provide adequate 

water and service to their various locations. Such injuries 

include alleged health problems associated with drinking BWC tap 

water and rate increases for water which is neither clean nor 

drinkable. Appellants also assert that they have increased 

expenses for purchasing bottled water in lieu of drinking tap 

water, increased energy bills from boiling water before use and 

2 
increased costs for purchasing juice, soda and other beverages as 

an alternative to tap water. Additionally, increased expenses for 

plumbing problems and appliance maintenance and repair due to the 

high concentration of sediment in the water allegedly plaque BWCts 

consumers. 

The respondents, according to the complaint, are 

a New Jersey Corporation with its principal place of 

business in Butte, Montana, engaged in the business of 

collecting, storing, purifying and transporting water to 

businesses, individuals, and public and private 

organizations in the City of Butte, Montana and 

elsewhere. BWC is a supplier of water and operates a 

public water system as defined in the Montana Public 

Water Supply Act, MCA Title 75, Chapter 6, and associated 

rules. . . . 

Defendant Dennis Washington is a resident of 

Montana, and is, and was at all times relevant to this 

complaint, a Director of the Butte Water Company, and its 

sole shareholder. 

The named appellants filed a complaint on March 5, 1990, 

alleging breaches of various duties of the respondents in their 

provision of water service to the appellants. Additionally, they 

sought to have their lawsuit certified as a class action to include 

others similarly situated. A hearing was held in the Second 

District Court on February 12 and 13, 1991, and the court issued 

its Findings of Fact, Conclusions of Law and Memorandum on April 

In its memo, the trial court concluded that the appellantst 

action met the test for certification of a class action under Rule 

23, M.R.Civ.P. The memo states that the appellants provided the 

following definition as the class it sought to certify: 

All persons or entities who have been billed for water 

service in Silver Bow County, Montana by the Butte Water 
Company for at least three consecutive months at any time 

subsequent to March 5, 1987 and prior to the final 

resolution of this action, and all persons residing at an 

address in Silver Bow County, as of the date of this 

motion [August 31, 19901, who receive Butte Water Company 

service. 

Following issuance of the court's order, the appellants filed a 

motion to redefine the class on May 20, 1991. On August 3, 1992, 

subsequent to oral argument on the motion, the trial court issued 

its order denying the motion to redefine the class. The trial 

court state& in its order: 

The court has previously indicated that the class would 

be all persons or entities who have been billed for water 

services in Silver Bow County, Montana. To expand the 

class to include individual members of households rather 

than the person purchasing the water service is 

unnecessary, overly broad, and will lead to confusion and 

delay in this matter. 

In the Notice of Class Action Lawsuit, dated October 13, 1992, 

the trial court identified the class in the action as: 

---- All ner-nnc or entities who h;r..ro been billed for water E--- -.---- service in Silver Bow County, Montana, by the Butte Water 

Company for at least three consecutive months at any time 

after March 5, 1987, and before December 31, 1991. 

Upon motion of all parties, the trial court certified the Notice as 

a final order adjudicating: (1) the rights of the named plaintiffs, 

and the class they sought to represent, to participate in this 

class action lawsuit; and (2) all of the issues raised by the 

parties in motions and briefs regarding the notice to the class. 

Appellants filed an appeal on October 23, 1992, and respondents 

filed a cross-appeal November 6, 1992. 

Our scope of review is whether the trial court's decision is 

an abuse of discretion. Murer v. State Fund (1993), 50 St.Rep. 
344, 345, - Mont. -, 849 P.2d 1036, 1037. 

I. DEFINITION OF THE CLASS 

Appellants argue that when they filed their motion for class 

certification, they proposed the following definition: 

[AJll persons or entities who have been billed for water 

service in Silver Bow County, Montana by the Butte Water 

Company for at least three (3) consecutive months at 

anytime subsequent to March 5, 1987, and prior to final 

resolution of this action, and all persons residing at an 

address in Silver Bow County, as of the date of this 

motion, who receive Butte Water Company water service. 

The appellants further argue that in their brief in support of 

their motion for class certification they described the class as 

consisting of mindividuals, their de~endents, and organizations 

identifiable through recordsw of BWC. (Emphasis added.) They 

continue, stating that in the District Court's order of April 19, 

1991, the trial court certified the class as defined by the 

appellants. It found that there were "between twelve and thirteen 

thousand individual hookups serving approximately 35,360 

individuals as well as various public and private businesses and 

governmental agencies." Although the respondents never challenged 

the appellants' definition of the class nor requested that the 

definition be narrowed, the trial court defined the class in its 

Notice of Class Action Lawsuit to consist of only those water 

consumers billed for water service in Silver Bow County. The 

appellants contend that this classification narrows the definition 

the court approved in its order granting appellants' motion to 

certify the class and thus is clearly inconsistent. 

The appellants further contend that the antiquated water 
system, the poor water quality, and the many service interruptions 

have caused injuries which have been faced by billed and non-billed 

consumers alike. The named appellants include billed and nonbilled consumers who suffered injuries typical of the entire class 

of consumers originally defined by the trial court. 

The respondents counter appellants1 contention that the trial 

court changed the definition of the class in its order denying the 

appellants' motion to redefine the class. They state that the 

orders are actually consistent because the court did not adopt the 

definition urged by the appellants in their motion for class 

certification. The court stated in its certification order that 

"[ildentification of such members probably shall be found in 

customer lists held by defendants." This definition, respondents 

argue, is consistent with the order denying the motion to redefine 

the class which stated that "[tlo expand the class to include 

individual members of households rather than the person purchasing 

the water service is unnecessary, overly broad and will lead to 

confusion and delay in this matter." 

Respondents further assert that the trial court refers to the 

appellants as mcustomersts and uses the term consumers in the sense 

that customers are the "consumers" in the business setting. 

Respondents also contend that only consumers who pay for the water 

can recover for monetary damages. One would have to be a billpaying consumer, a customer, to have a basis to claim injuries 

because of interruptions in service, damage to plumbing and 

appliances and additional expenses incurred purchasing bottled 
water and for boiling water. 

Finally, respondents argue that the appellants themselves 

defined the class as customers. In their motion for class 

certification, the appellants defined the class as *la11 persons . 

. . who have been billed for water service . . . & . . - who 

receive Butte Water Company service." (Emphasis added.) 

Therefore, to be a member of the class, a person must meet two 

conditions: 1) must be billed for three consecutive months and 2) 

must reside in Silver Bow County as of the date of this motion. 

Additionally, respondents argue that the appellants also stated 

that the class members could be identified through BWC records, 

which would only consist of customers. 

After a careful review of the record, we determine that the 

class definition used in the notice to class, which excludes nonbilled customers, was arbitrarily changed. The complaint, the 

motion to certify the class and its supporting brief, and the 

transcript of the certification hearing, all allude to billed and 

non-billed customers or consumers (users). It makes no sense to 

exclude persons who allegedly drove to alternative water sources 

for drinkable water, bought alternative beverages for consumption, 

cleaned toilet bowls and tanks, suffered physical ailments and 

nursed others through physical ailments stemming from use of BWC 

water, from the class to be certified. / 

Sister Mary Jo McDonald testified at the hearing to certify 

the class that she spends $20 to $25 per month on juice and soda as 

alternatives to drinking tap water. Jim McDonald testified that he 
and his wife, Janet Lindh, travel to Springhill twice a month to 

obtain drinking water. The complaint states that the trip to 

Springhill is approximately 80 miles roundtrip. Further, Jim and 

Janet both suffer from rashes after bathing and showering in BWC 

water. These are all problems suffered by billed and non-billed 

customers alike. 

In the appellants' brief in support of its motion to certify 

the class, the appellants stated that I' [t] he proposed class 

consists largely of individuals, their dependents, and 

organizations identifiable through records believed to be in the 

possession of Defendant Butte Water Company....11 (Emphasis added.) 

Defendants did not contest the definition of the class as comprised 

of billed and non-billed users. In fact, their brief in opposition 

to the motion to certify the class stated that: 

[Tlhe Butte Water Company has 13,400 water hookups 

in the vicinity of the City of Butte, servicing 35,000 

individuals and 1200 organizational users. It would 

appear that the size of the class would then be 36,200 

individual and organizational claims. 

Ultimately, the trial court ruled that a class action could be 

maintained in the lawsuit in its April 19, 1991 order which stated 

that the plaintiffs sought to certify as a class: 

All persons or entities who have been billed for water 

service in Silver Bow County, Montana by the Butte Water 

Company for at least three consecutive months at any time 

subsequent to March 5, 1987 and prior to the final 

resolution of this action, and all persons residing at an 

address in Silver Bow County, as of the date of this 

motion [August 31, 12901, who receive Butte Water Company 

service. 

The court also stated that the class was so numerous that joinder 

of all members was impracticable. It described the class as 
"between twelve and thirteen thousand individual hookups serving 

approximately 35,350 individuals as well as various public and 

private businesses and governmental agencies .... II The class 

contemplated by the appellants, respondents and the trial court 

throughout all preliminary proceedings included all consumers, 

customers or users of BWC water, including billed and non-billed 

individuals. It was an abuse of discretion for the trial court to 

change the definition, thereby excluding individuals who claim to 

have suffered injuries because of BWCvs allegedly inadequate 

service and poor water quality. No reasonable basis exists for 

excluding persons who claim to have suffered at the hands of BWC 

simply because one allegedly injured plaintiff is billed while 

another, suffering the same sort of injury, is not. Therefore, the 

trial court abused its discretion on this issue and we accordingly, 

reverse. 

11. CROSS-APPEAL - CLASS ACTION DESIGNATION 

The trial court ruled that the instant case should be 

designated as a class action. We agree with its determination of 

this issue on the basis of our review. 

"[Tlhe judgment of the trial court should be given 

the greatest respect and the broadest discretion, 

particularly if ... he has canvassed the factual aspects 

of the litigation." This is so because the district 

court is in the best position to consider the most fair 

and efficient procedure for conducting any given 

litigation. Such a determination by the court will not 

be disturbed on appeal unless the party challenging it 

can show an abuse of discretion. 

Doninger v. Pacific Northwest Bell, Inc. (1977), 564 F.2d 1304, 

1309. (Citations omitted.) We note that Rules 23 (a) and (b) , 
M.R.Civ.P., and the Federal Rules of Civil Procedure 23(a) and (b) 

are identical. We therefore find cases interpreting the federal 

rule to be instructive. 

The respondents, however, argue that the trial court erred 

when it concluded that the present lawsuit should be adjudicated as 

a class action. They argue that the appellants cannot establish 

the elements necessary under Rule 23(a) and (b)(3), M.R.Civ.P., to 

certify a class action. The six elements include: 

1. The class must be so numerous that joinder of all 

members is impractical. 

2. There must be questions of fact or law common to the 

class. 

3. The claims or defenses of the representative parties 

must be typical of the claims or defenses of the proposed 

class. 

4. The representative parties will fairly and adequately 

protect the interest of the proposed class. 

5. The questions of law or fact common to the members cf 

the class predominate over questions of the individual 

members. 

6. The class action is superior to other methods of 

adjudicating the controversy. 

Rule 23 (a) and (b) (3) , M.R.Civ.P. 

The appellants have the burden of establishing each of the six 

elements. Doninaer, 564 F.2d at 1308. We conclude that the 

appellants did meet their burden of establishing the necessary 

elements to certify the present case. We discuss each of the 

elements in turn. 

The first element requires that the class be so numerous that 

joinder of all members is impracticable. Rule 23(a) (I), l4.R.Civ.P. 
In the instant case, there are 12,000 to 13,000 "hookups" serving 

about 35,360 persons. We agree with the trial court that 

vv[p]laintiffs clearly meet the first requirement of Rule 23(a)(l) 

in that the class is so numerous that joinder of all members is 

impractical." 

The second element requires that there be questions of law or 

fact common to the class. Rule 23 (a) (2) , M.R.Civ.P. We agree that 

this element was also successfully established by the appellants. 

Respondents argue that there is not commonality because customers 

lived in different areas of Butte and their water sources may have 

been different from other class members. They also contend that 

customers suffered varying health effects from BWC water usage and 

that water was consumed for varying amounts of time with different 

reactions, so that the injuries suffered from one putative 

plaintiff to another are so different that there are not sufficient 

questions of law or fact common to the class. However: 

Rule 23 (a) (2) does not require that every question of law 

or fact be common to every member of the class. The 

commonality requirement is satisfied "where the question 

of law linking the class members is substantially related 

to the resolution of the litigation even though the 

individuals are not identically situated.". . . Courts 

that have analyzed Rule 23(a)(2) have generally given it 

a permissive application in a variety of substantive law 

areas so that the commonality requirement is usually 

found to be satisfied. (Citations omitted.) 

Jordan V. County of Los Angeles (1982), 669 F.2d 1311, 1320. 

In the instant case, all counts stem from the alleged failure 

of BWC to provide potable water and adequate service. We agree 

with the trial court which stated: 

The primary cause and common theory of these claims 

11 
is the same, i.e. an antiquated and poorly repaired water 

system. The court also notes that the claims of the 

twenty-four named plaintiffs, as well as the complaints 

of the consumers (Plaintiffs' Exhibit No. 12) show a 

recurrent theme of monetary damages from the consumers 

having to find alternative water sources. 

We note in passing, that the health advisory of August 14, 1989, 

was appropriate evidence to consider in determiningthe commonality 

of questions of law or fact. The advisory was sent to all persons 

served by BWC and even though it was a strong recommendation and 

not a mandate, it was probative as to whether the class members 

shared common issues of law and fact. We note also, that Brown v. 

New Orleans Public Service, Inc. (La. 1987), 506 So. 2d 621, 623, 

can be distinguished because a major issue in that case involved 

comparative negligence and an intervening cause - cold weather 

which exacerbated the problems encountered by the plaintiffs. 

The third element requires that the claims or defenses of the 

representative parties are typical of the claims or defenses of the 

class. Rule 23(a)(3), W.R.Civ.P. We conclude that this requisite 

is established. The representative class is comprised of billed 

customers as well as non-billed customers as is the entire class. 

The claims of the representative class included the costs of 

alternative drinking supply or sources, increased power bills from 

having to boil water before consuming, increased expense to repair 

plumbing problems due to the particulate matter in the water, 

expenses for repair and maintenance of appliances (i.e. washing 

machine), and discolored and/or foul-smelling water emitted from 

the water faucets. These costs have been borne by the 

representative class as well as the class at large. 

12 
The typicality requirement is designed to assure 

that the named representative's interests are aligned 

with those of the class. Where there is such an 

alignment of interests, a named plaintiff who vigorously 

pursues his or her own interests will necessarily advance 

the interests of the class. In this respect, the 

typicality prerequisite is closely related to both the 

23(a) (2) requirement that there be common questions of 

law or fact and the 23(a) (4) requirement that the named 

plaintiff adequately protect the interests of the class. 

The named plaintiff's claim will be typical of the 

class where there is a nexus between the injury suffered 

by the plaintiff and the injury suffered by the class. 

Thus, a named plaintiff's claim is typical if it stems 

from the same event, practice, or course of conduct that 

forms the basis of the class claims and is based upon the 

same legal or remedial theory. (Citations omitted.) 

(Emphasis added.) 

Jordan, 669 F.2d at 1321. Here, the typicality requirement is met 

because the injury claimed to be suffered by the named plaintiffs 

is the same as that suffered by the class and all injuries stem 

from the same course of conduct allegedly displayed by the 

defendants: that is, negligence in its duty to provide adequate 

water and service. 

The respondents make an argument that a survey they conducted 

indicated that the representative plaintiffs' interests were not 

typical of those of the class because the majority of class members 

surveyed did not wish to participate in the lawsuit. The trial 

court dispensed with this argument by stating that it was skeptical 

of the ability of a survey to accurately determine matters of 

public opinion. It also concluded that the survey could be 

intimidating to some people and may have been phrased to persuade 

those surveyed to respond in a negative manner to the lawsuit. We 

agree with the trial court and with the district court in Koger v. 

Guarino (1976), 412 F. Supp. 1375, 1379, which stated: 
We therefore find that the fact that the class may 

contain individuals who are indifferent or even opposed 

to the class relief sought by the named plaintiffs does 

not mean that the claims of the named plaintiffs are not 

typical of those of the class or that they will not 

fairly and adequately protect the interests of the class, 

(Citation omitted.) 

The fourth element necessary to establish a class action is 

whether the representative class will fairly and adequately protect 

the interest of the proposed class. Rule 23(a)(4), M.R.Civ.P. 

Under Rule 23(a)(4), the named representative must 

"fairly and adequately protect the interests of the 

class." This requires that the named representative's 

attorney be qualified, experienced, and generally capable 

to conduct the litigation, and that the named 

representative's interests not be antagonistic to the 

interests of the class. (Citations omitted.) 

Jordan, 669 F.2d at 1323. There is no dispute concerning the 

expertise and qualifications of the representatives' attorneys in 

this case. The question of whether the representativest interests 

were antagonistic to the interests of the class was resolved in the 

discussion of Rule 23 (a) (3), M.R.Civ.P., wherein we agreed with the 

trial court that the survey was unreliable insofar as it attempted 

to prove that most putative plaintiffs were against the lawsuit. 

The representatives' interests in potable water and adequate water 

service are coextensive with those of the remaining class members 

and therefore we conclude that the representative plaiqtiffs would 

fairly and adequately protect the interests of the class. Jordan, 

The fifth requirement to establish certification as a class 

action is whether questions of law or fact common to the members of 

the class predominate over questions of the individual members. 
Pale 23 (b) (3) , M.R.Civ.P. The respondents contend that the 

countless differences in damages for customers make the 

certification of a class "impra~tical.~ The appellants, however, 

counter that this determination revolves around issues of 

liability. Damages may always differ for the members but the issue 

of damages is not dispositive. Liability to all consumers is 

premised on BWC1s failure to provide adequate service and quality 

water. The appellants further argue that this primary issue of 

liability for the entire class predominates over the individual 

issues of causation and damages for class members. 

With respect to the calculation of the amounts of 

damages, it would he necessary for each member of the 

class individually to prove the quantity of gasoline 

purchased at supracompetitive prices and the prices paid. 

Nevertheless, it has been commonlv recosnized that the 

necessitv for calculation of damases on an individual 

basis should not preclude class determination when the 

common issues which determine liabilitv medominate. 

(Emphasis added.) (Citations omitted.) 

Bogosian v. Gulf Oil Corp. (1977), 561 F.2d 434, 456. Similarly, 

the primary issue of liability here stems from BWC's failure to 

provide adequate water and service to its customers, although 

individual damages may vary. Therefore, the individual issues of 

causation and damages should not preclude certification as a class 

action. The trial court correctly determined that this necessary 

element is established. 

The sixth, and final element necessary to certify a class 

action is whether a class action is superior to other methods of 

adjudicating the controversy. Rule 23 (b) (3), M.R.Civ.P. To 

determine whether a class action is superior to other methods of 
adjudication, Rule 23 (b) (3) requires a consideration of four 

factors, namely: 

A. the interest of members of the class in individually 

controlling the prosecution or defense of separate 

actions ; 

8. the extent and nature of any litigation concerning the 

controversy already commenced by or against members of 

the class; 

C. the desirability or undesirability of concentrating 

the litigation of the claims in the particular forum; 

D. the difficulties likely to be encountered in the 

management of a class action. 

Rule 23 (b) (3) (A) through (D) . 

The respondents contend that the individual questions in this 

case will consume an extensive amount of time, energy and expense 

yet still not give each member of the class its "day in courtw 

because this case is actually many little cases which should be 

brought in small claims court. The appellants counter that there 

is no real alternative to a class action in this case. The 

individual cases because they are so minuscule as individual 

actions. 

We hold that a class action is the superior method of 

adjudicating this controversy. As for the first factor, any member 

who wants more control in the action can enter an appearance 

through their own counsel under Rule 23(c)(2), M.R.Civ.P., or opt 

out of the class and intervene in the case. The second factor does 

not apply because there is no evidence of any other litigation 

involving members of the class although BWC has been involved in 

litigation with the state and federal governments regarding water 

quality. The third factor does not apply because there is no other 
forum which class members have sought out in order to bring an 

action against BWC. 

Finally, the trial court determined that "a class action is 

superior in this instance" because numerous plaintiffs have 

allegedly been harmed but no one person may have been damaged to 

such a degree that he may have sought to institute litigation on 

his own behalf. See Green v. Wolf Corporation (1968) , 406 F.2d 

291, 296. We reiterate that the trial court is in the best 

position to determine if the case is properly litigated as a class 

action. Doninaer, 564 F.2d at 1309. 

The Green court also put into perspective the need for class 

actions and the type of case which is best litigated as a class 

action: 

Equity has long recognized that there is need for a 

course which would redress wrongs otherwise unremediable 

because the individual claims involved were too small, or 

the claimants too ,,~aly dispersed. Moreover, early in 

the development of our civil procedures it became 

apparent that judicial efficiency demanded the 

elimination of multiple suits arising from the same facts 

and questions of law. Hence, the wise and necessary 

procedure was created by which a few representatives of 

a class could sue on behalf of others similarly situated, 

and be granted a judgment that would bind all. (Citation 

omitted. ) 

-, Green 406 F.2d at 297. In the instant case, the claims involved 

would be unremediable without class action status because most are 

minor in and of themselves. In addition, the many claims arise 

from the same facts and questions of law. We conclude that this is 

a proper case for class action certification, and we affirm the 

trial court on this issue. 

111. PROPER NOTICE 
As a final issue on cross-appeal, the respondents assert that 

the notice given by the trial court to the class is improper. They 

contend that one element of the notice is erroneous and another 

essential element is entirely omitted from the notice. 

First, the notice states that the members "will not be 

required to pay any attorneysp fees or costs in the absence of a 

monetary recovery." However, respondents assert that class members 

may be liable for a portion of respondents' attorneysf fees in the 

event of a loss for appellants. The respondents further contend 

that since this is a contract action and the appellants have 

requested attorneys' fees, the respondents, as the other party, 

have the same right to recover attorneys' fees. Finally, they 

state that the potential members of the class should have this 

information before they decide whether they wish to participate in 

the class action. 

The second error in the notice, insist the respondents, is 

that the District Court should have advised the potential class 

members that they have the option of not participating in the class 

action. Additionally, they do not have to bring their own action 

against the BWC. They assert that to omit this information is 

almost tantamount to encouraging the potential members of the class 

to initiate an action against BWC. 

Appellants counter that there was no reason to advise the 

class members that they may be liable for attorneys' fees in the 

event of a loss by appellants nor that they may choose to forego 

participation in the class action if they so desire. Also, 
appellants argue that respondents* position that it can recover 

attorneys' fees because the parties have a contract relationship 

which provides for reciprocal attorneys1 fees is erroneous. The 

respondents base their argument on 5 28-3-704, MCA, which gives 

both parties the right to recover attorneys1 fees if there is an 

exvress statement in the contract which gives the parties the right 

to recover attorneys' fees. 

Wright v. Schock (9th Cir. 1984), 742 F.2d 541, 545, is 

instructive and supports the appellants1 position that members who 

remain in the class are not liable for the respondents1 attorneys* 

fees, stating that "[albsent class members have no obligation to 

pay attorneys* fees and litigation costs, except when they elect to 

accept the benefit of the litigation." Lamb v. United Security 

Life Company (S.D. Iowa 1973), 59 F.R.D. 44, 48-49, expands on this 

proposition, concluding: 

Upon reconsideration, this Court is of the opinion 

that members of the class who do not opt out and do not 

appear especially by counsel of their own selection are 

not l*partiesl1 to the action. Accordingly, they would not 

be liable for any costs or expenses assessed against the 

representative parties plaintiff. 

Accordingly, the Court will order that the Notice to 

the class contain a provision so informing all members of 

the class. The Notice shall also advise all members of 

the class that if any recovery should be effected for the 

class, the Court may allow from such recovery 

reimbursement of plaintiffs* expenses and counsel 

fees... . 

Furthermore, the respondents1 argument that under 5 28-3-704, 

MCA, the members of the class could be liable for the respondents1 

attorneys1 fees because this is a contract action is misplaced. 

Section 28-3-704, MCA, requires that the losing party pay 
reasonable attorneys1 fees a there is an express right to recover 

attorneys' fees in the contract. No evidence of an express right 

in a contract was presented here. Therefore, the trial court did 

not err in stating that the members "will not be required to pay 

any attorneys1 fees or costs in the absence of a monetary 

recovery." 

Moreover, the trial court did not err in not including a 

statement that members of the class could "simply choose not to 

participate in any lawsuit against the Defendants." The Notice of 

Class Action Lawsuit stated that: 

If you opt out of the class, you will not be 

entitled to share in any monetary compensation which may 

ultimately be obtained. However, you mav file a separate 

lawsuit against the Defendants, or you may retain our 

(sic) own attorney and intervene in this lawsuit. 

(Emphasis added.) 

The Notice also provided a form to fill out if a person wanted to 

. . be excluded from the class. The use of the permrssrve word "may," 

and the use of the form are enough to inform potential members of 

the class that they may opt out entirely if they prefer. The 

Notice provided was adequate in its notification to the class as to 

the rights and responsibilities of the members of the class. 

Accordingly, the trial court is affirmed as to pis issuey 

AFFIRMED IN PART AND REVERSED 

We Concur: 
Distrlct Judge, sitting in 

place of Justice Karla W. Gray 
November 4. 1993 

CERTIFICATE OF SERVICE 

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

following named: 

James H. Goetz 

GOETZ, MADDEN & DUNN, P.C. 

35 North Grand 

Bozeman, MT 59715 

MARTIN R. STUDER 

Attorney at Law 

12 N. Third Ave., Suite 1 

Bozeman, MT 59715 

Ronald M. MacDonald 

DATSOPOULOS, MacDONALD, & LIND 

201 West Mail,, Ctmi~di Syuarc: Bidy. 

Missoula, MT 59802 

Alan L. Joscelyn 

GOUGH, SHANAHAN, JOHNSON & WATERMAN 

P.O. Box 1715 

Helena, MT 59624-1715 

ED SMITH 

CLERK OF THE SUPREME COURT 

STATE OF MONTANA