RUSSELL HAUGEN and 

DONN R. HAUGEN, 

Plaintiffs and Appellants, 

v. 

BLAINE BANK OF MONTANA, 

a Montana Corporation, 

WILLIAM LARSEN, GLENN 

HUESTIS, JOHN DOE 1 

and JOHN DOE 2, 

Defendants and Respondents. 

No. 95-554. 

Submitted on Briefs March 28, 1996. 

Rehearing Denied December 9, 1996. 

Decided October 24, 1996. 

Appeal from the District Court of Blaine County. 

Seventeenth Judicial District. 

Honorable John C. McKeon, Judge.See C.J.S. Dismissal and Nonsuit Sec. 62. 

Affirmed. 

JUSTICE NELSON specially concurs, joined by JUSTICE GRAY. 

JUSTICE LEAPHART dissenting, joined by JUSTICES TRIEWEILER and HUNT. 

JUSTICE TRIEWEILER dissenting, joined by JUSTICE HUNT. 

JUSTICE HUNT dissenting, joined by JUSTICES TRIEWEILER and LEAPHART. 

For Appellant: Thomas S. Winsor, Winsor Law Firm, Helena. 

For Respondent: Ward E. Taleff, Alexander, Baucus, Taleff & Paul, Great Falls; Mark 

Harshman, Blaine County Attorney, Chinook. 

JUSTICE NELSON delivered the Opinion of the Court. 
Plaintiffs Russell and Donn R. Haugen appeal an order of the District Court for the 

Seventeenth Judicial District, Blaine County, dismissing their claim for failing to meet 

the requirements of Rule 41(e), M.R.Civ.P. We affirm. 

We address the following issues on appeal: 

1. Did the District Court err in determining that Plaintiffs failed to meet the requirements 

of Rule 41(e), M.R.Civ.P., thereby requiring dismissal of their claim? 

2. Did Plaintiffs file their Notice of Appeal in a timely manner? 

Factual and Procedural Background 

Plaintiffs filed their complaint on August 28, 1992, seeking damages for an alleged 

unlawful sale of personal property in connection with a sheriff's sale. The sale was held 

pursuant to a judgment obtained by Blaine Bank of Montana (Blaine Bank) against 

Plaintiffs. The Clerk of the District Court of Blaine County issued a summons for each 

Defendant on July 23, 1993, but the summonses were never served. 

On September 21, 1994, the clerk of court sent a letter to Plaintiffs' attorney advising him 

that the case remained open and requesting that some action be taken, if possible, to 

move the case closer to conclusion. On April 7, 1995, Plaintiffs' attorney filed a report 

with the District Court stating Plaintiffs' intention to activate the file and proceed with 

their claim. On July 3, 1995, Plaintiffs filed a notice advising the court that their previous 

counsel had withdrawn and new counsel had been substituted. 

Defendants William Larsen and Blaine Bank prepared a Motion to Dismiss for Failure to 

Prosecute in anticipation of Plaintiffs not perfecting service within three years of filing 

the complaint. The motion was mistakenly filed on August 24, 1995, a few days prior to 

the expiration of the three-year period. 

At Plaintiffs' request, the clerk of court issued amended summonses on August 23, 1995. 

The Blaine County Sheriff's Office served the complaint and summonses upon 

Defendants Larsen and Blaine Bank on August 25, 1995, and upon Defendant Glenn 

Huestis, on August 29, 1995. The sheriff returned proof of service for each summons to 

Plaintiffs' counsel, as he had been instructed. 

On August 29, 1995, the District Court dismissed the complaint on the grounds that 

Plaintiffs failed to file proof of service for each summons with the clerk of court within 

the three years proscribed by Rule 41(e), M.R.Civ.P. Plaintiffs moved for reconsideration 

stating that they did not receive proof of service on the three summonses until August 31, 

1995, three days after the expiration of the three-year period, and that they mailed the 

proof of service for each summons to the clerk of court for filing on September 2, 1995. 

The District Court denied Plaintiffs' Motion for Reconsideration and Plaintiffs appeal 

Issue 1. 
Did the District Court err in determining that Plaintiffs failed to meet the requirements of 

Rule 41(e), M.R.Civ.P., thereby requiring dismissal of their claim? 

Our standard in reviewing a district court's conclusions of law is to determine whether the 

court's interpretation of the law is correct. Sinclair v. Big Bud Mfg. Co. (1993), 865 P.2d 

264, 266 (citing Steer, Inc. v. Department of Revenue (1990), 474-75, 803 P.2d 601, 

603). 

The District Court dismissed Plaintiffs' complaint because Plaintiffs failed to file proof of 

service for each summons with the clerk of court within three years of the 

commencement of this action. Plaintiffs filed their complaint on August 28, 1992. Under 

Rule 41(e), M.R.Civ.P., the summonses for all three Defendants should have been served 

and filed by August 28, 1995. However, Defendant Huestis was not served with a 

summons until August 29, 1995. In addition, proof of service upon all three Defendants 

was not filed with the clerk of court until September 5, 1995. Rule 41(e), M.R.Civ.P. 

provides in pertinent part: 

all actions heretofore or hereafter commenced shall be dismissed by the 

court in which the same shall have been commenced, on its own motion, 

or on the motion of any party interested therein, whether named in the 

complaint as a party or not, unless summons shall have been issued within 

1 year, or unless summons issued within one year shall have been served 

and filed with the clerk of the court within 3 years after the 

commencement of said action, or unless appearance has been made by the 

defendant or defendants therein within said 3 years. [Emphasis added.] 

Plaintiffs contend that as long as the summonses were served 

within three years, filing proof of service with the clerk of court is a mere formality and 

failure to file should not preclude proceeding with their claim. Plaintiffs rely on 

Livingston v. Treasure County (1989), 781 P.2d 1129, for this proposition. 

In Livingston, the plaintiff filed a complaint on November 27, 1985, alleging personal 

injuries due to the negligence of defendant's employees. A summons was issued on the 

same day. Three years later, on November 27, 1988, plaintiff delivered the summons and 

complaint to the sheriff, who served defendant on that day. Plaintiff did not file proof of 

service of the summons with the district court until December 20, 1988. We held in 

Livingston that filing proof of service is "simply a ministerial act" and failure to file 

within three years of the commencement of the action did not require dismissal. 

Livingston, 781 P.2d at 1131. 

Having carefully considered Livingston and other more recent decisions involving Rule 

41(e), M.R.Civ.P., we now conclude that our interpretation of this Rule in Livingston was 

incorrect. As Justice McDonough pointed out in his dissent in Livingston, 

[t]he language of the rule clearly and unequivocally requires the dismissal 

of lawsuits when the return of service fails to be "filed with the Clerk of 
Court within three years after the commencement of said action." Such 

words should be given their plain and ordinary meaning. 

Section , MCA, Rierson v. State (1980), 188 Mont. 

522, 614 P.2d 1020. Livingston, 781 P.2d at 1131. 

In addition, we stated in First Call v. Capital Answering Serv., Inc. (1995), 898 P.2d 96, 

97, that: 

 It is an oft repeated rule of statutory construction, equally applicable to 

our interpretation of the rules governing practice and procedure in the 

courts of this State, that "the office of the judge is simply to ascertain and 

declare what is in terms or in substance contained therein, not to insert 

what has been omitted or to omit what has been inserted." Section , MCA. 

Moreover, if the language is clear and unambiguous, no further 

interpretation is required. 

The language of Rule 41(e), M.R.Civ.P., is clear and unambiguous; all actions shall be 

dismissed unless summons issued within one year "shall have been served and filed with 

the clerk of the court within 3 years after the commencement of said action." 

We therefore hold that filing proof of service with the clerk of court is not "simply a 

ministerial act" as we stated in Livingston and we overrule Livingston on that basis. 

Furthermore, we reasoned in Livingston that dismissing an action because the plaintiff 

failed to file proof of service with the clerk of court within the three-year period 

proscribed by Rule 41(e) was too harsh a result and prejudicial to the plaintiff. On the 

contrary, permitting a plaintiff to disregard the mandates of Rule 41(e) is prejudicial to 

the defendant and defeats the purpose of the Rule which is to promote the diligent 

prosecution of claims once suit is filed. 

In the case before us, Plaintiffs were less than diligent in proceeding with their claim. 

They filed the complaint two days before the statute of limitations on their claim expired. 

They did not issue the original summonses until the month before the one-year period 

dictated by Rule 41(e) elapsed, and they did not attempt to issue amended summonses 

until one week before the three-year period dictated by Rule 41(e) elapsed. 

Moreover, since the three-year period for serving a summons set forth in Rule 41(e) was 

about to expire, Plaintiffs could have taken any one of several steps to insure that they 

complied with all of the requirements of that Rule. First, rather than instructing the 

Sheriff to return proof of service for each summons to Plaintiffs' counsel, Plaintiffs could 

have requested that the Sheriff file the proof of service with the clerk of court as soon as 

service had been accomplished. Second, Plaintiffs could have requested that the Sheriff 

serve the summonses and return the proof of service to Plaintiffs by a specific date. 
Third, Plaintiffs could have asked the Sheriff to call them when service was made so that 

Plaintiffs could pick up the proof of service rather than having the Sheriff mail it to them. 

And, finally, Plaintiffs could quite simply have issued the amended summonses a few 

days sooner than they did. 

The dissent believes that our decision to overrule Livingston should be applied 

prospectively only, as it would be an injustice to deny the Plaintiffs the opportunity to 

present their case before a tribunal of this State. However, as we have just demonstrated, 

the Plaintiffs had every opportunity to present their claim. It is because of their lack of 

diligence that they are now precluded from proceeding. 

Rule 41(e) has at all times pertinent to this action required that summons be served and 

filed with the clerk of court within three years of the commencement of the action. 

Consequently, this is not a question of whether a judicial revision of a procedural rule 

should have retroactive application, as Rule 41(e) has not been revised. Rather, this is a 

question of whether a change in the judicial interpretation of a long-existing procedural 

rule should have retroactive application. 

It is an often cited judicial canon that retroactivity "is not favored in the law," hence 

"congressional enactments and administrative rules will not be construed to have 

retroactive effect unless their language requires this result." Landgraf v. USI Film 

Products (1994), 511 U.S. 244, 114 S.Ct. 1483, 1496, 128 L.Ed.2d 229 (quoting Bowen 

v. Georgetown University Hospital (1988), 488 U.S. 204, 208, 109 S.Ct. 468, 471, 102 

L.Ed.2d 493). However, the United States Supreme Court maintains that "[t]he principle 

that statutes operate only prospectively, while judicial decisions operate retrospectively, 

is fa- miliar to every law student." Rivers v. Roadway Express, Inc. (1994), 511 U.S. 298, 

114 S.Ct. 1510, 1519, 128 L.Ed.2d 274 (quoting United States v. Security Industrial Bank 

(1982), 459 U.S. 70, 79, 103 S.Ct. 407, 413, 74 L.Ed.2d 235). "Judicial decisions have 

had retrospective operation for near a thousand years." Rivers, 511 U.S. at ___, 114 S.Ct. 

at 1519 (quoting Kuhn v. Fairmont Coal Co. (1910), 215 U.S. 349, 372, 30 S.Ct. 140, 

148, 54 L.Ed. 228 (Holmes, J., dissenting)). Moreover, "[a] judicial construction of a 

statute is an authoritative statement of what the statute meant before as well as after the 

decision of the case giving rise to that construction." Rivers, 511 U.S. at ___, 114 S.Ct. at 

1519. 

Similarly, this Court has often stated that judicial decisions will be given retroactive 

effect. Kleinhesselink v. Chevron, U.S.A. (1996), [277 Mont. 158], 920 P.2d 108, 111; 

Porter v. Galarneau (1996), 911 P.2d 1143, 1150; State, City of Bozeman v. Peterson 

(1987), 739 P.2d 958, 960. To illustrate, in First Call v. Capital Answering Serv., Inc. 

(1995), 898 P.2d 96, when called upon to interpret another provision of Rule 41(e), this 

Court held that dismissals under the Rule are dismissals with prejudice and must be given 

res judicata effect. In so holding, the Court overruled two prior decisions in direct 

opposition to the holding in First Call, and remanded the case to the District Court for 

entry of an order dismissing the complaint with prejudice. 
Even if we considered the interpretation of Rule 41(e) in the instant case as a revision of 

the Rule, that revision could still be applied retroactively under our existing case law. 

Section , MCA, provides: 

 When laws retroactive. No law contained in any of the statutes of 

Montana is retroactive unless expressly so declared. 

This Court has repeatedly interpreted the above statute by defining a retroactive law as 

one that takes away or impairs vested rights acquired under existing laws or creates new 

obligations or imposes new duties in respect to transactions already past. Castles v. State 

ex rel Mont. Dept. of Highways (1980), 609 P.2d 1223, 1225; Matter of Water Rights 

No. 101960-41S (1991), 816 P.2d 1054, 1058; Porter, 911 P.2d at 1150. However, this 

Court has simultaneously pointed out that a statute that modifies the procedure for 

exercising a vested right or carrying out a duty does not constitute retroactive legislation. 

Castles, 609 P.2d at 1225; Matter of Water Rights, 816 P.2d at 1058. Although the 

guiding principle is Sec. , MCA, it has been held that where a statute is procedural, rather 

than substantive, Sec. , MCA, has no application, and the statute in question will be 

applied to a cause of action arising before its enactment. Boehm v. Alanon Club (1986), 

722 P.2d 1160, 1162. See Saint Vincent Hosp. v. Blue Cross (1993), 862 P.2d 6, 9; State 

Compensation Ins. v. Sky Country (1989), 780 P.2d 1135, 1137; Weiss by and through 

Weiss v. State (1986), 712 P.2d 1315, 1316; State v. District Court of Fourth Judicial 

District (1966), 417 P.2d 109, 112. When a change of law merely affects the remedy or 

law of procedure, all rights of action will be enforceable under the new procedure without 

regard to whether they accrued before or after such change of law and without regard to 

whether the suit has been instituted or not, unless there is a saving clause as to existing 

litigation. Fourth Judicial District, 417 P.2d at 112. 

In like manner, the United States Supreme Court has stated that a retroactive law is one 

that takes away or impairs vested rights but "[n]o one has a vested right in any given 

mode of procedure." Ex parte Collett (1949), 337 U.S. 55, 71, 69 S.Ct. 944, 953, 93 L.Ed. 

1207. "Changes in procedural rules may often be applied in suits arising before their 

enactment without raising concerns about retroactivity." Landgraf, 511 U.S. at ___, 114 

S.Ct. at 1502. "Because rules of procedure regulate secondary rather than primary 

conduct, the fact that a new procedural rule was instituted after the conduct giving rise to 

the suit does not make application of the rule at trial retroactive." Landgraf, 511 U.S. at 

___, 114 S.Ct. at 1502. 

Hence, both the United States Supreme Court and this Court have repeatedly ruled that 

judicial decisions, particularly on procedural matters, may be applied retroactively. 

Moreover, while stare decisis is a fundamental doctrine which reflects our concerns for 

stability, predictability and equal treatment, stare decisis does not require that we follow a 

manifestly wrong decision. Formicove, Inc. v. Burlington Northern, Inc. (1983), 194-95, 

673 P.2d 469, 472. The doctrine of stare decisis is not an inflexible rule since previous 

decisions should not be followed to the extent that error may be perpetuated. State v. 

State Board of Examiners (1957), 309 P.2d 336, 340. 
Accordingly, we hold that the District Court was correct in dismissing Plaintiffs' 

complaint because Plaintiffs failed to file proof of service of summons with the clerk of 

court within three years of the commencement of this action. 

Issue 2. 

Did Plaintiffs file their Notice of Appeal in a timely manner? 

Defendants contend that Plaintiffs' appeal in this matter is untimely because the District 

Court's order dismissing Plaintiffs' complaint was filed on August 29, 1995, and 

Plaintiffs' Notice of Appeal was not filed until November 8, 1995. Defendants argue that 

under Rule 5, M.R.App.P., a Notice of Appeal should have been filed within 30 days of 

the District Court's order dismissing Plaintiffs' complaint. Rule 5, M.R.App.P, provides, 

in part: 

(a) Appeals in civil cases. 

(1) In civil cases the notice of appeal required by Rule 4 shall be filed with 

the clerk of the district court within 30 days from the date of the entry of 

the judgment or order appealed from, except that in cases where service of 

notice of entry of judgment is required by Rule 77(d) of the Montana 

Rules of Civil Procedure the time shall be 30 days from the service of 

notice of entry of judgment. ... [Emphasis added.] Plaintiffs assert that 

they did not receive a Notice of Entry 

of Judgment as required by Rule 5, M.R.App.P., and Rule 77(d), M.R.Civ.P. Rule 77(d), 

M.R.Civ.P., provides, in part: 

 Notice of entry of judgment or order served. Within 10 days after entry 

of judgment or an order in an action in which an appearance has been 

made, notice of such entry, together with a copy of such judgment or order 

or general description of the nature and amount of relief and damages 

thereby granted, shall be served by the prevailing party upon all parties 

who have made an appearance, but any other party may in addition serve a 

notice of such entry in the manner provided in Rule 5 for the service of 

papers. [Emphasis added.] As the prevailing party, Defendants should 

have served 

Plaintiffs with a notice of entry of judgment. Plaintiffs would then have had 30 days from 

the service of the notice of entry of judgment to file their Notice of Appeal. Rule 5, 

M.R.App.P. It is the filing of a notice of entry of judgment that begins the running of the 

time limit for filing a notice of appeal. In re Marriage of Robertson (1989), 773 P.2d 

1213, 1216 (citations omitted). Since Defendants failed to serve Plaintiffs with a notice of 

entry of judgment, the 30 days allowed Plaintiffs to file the notice of appeal never began 

to run. Robertson, 773 P.2d at 1216. 
Defendants also contend that Plaintiffs' motion for reconsideration, filed September 5, 

1995 and denied by the District Court on October 13, 1995, did not extend the deadline 

for filing a Notice of Appeal. Since we have already stated that the time allowed 

Plaintiffs to file their Notice of Appeal never began to run, there was, thus, no need for an 

extension. We nevertheless address Defendants' contention to further clarify this issue. 

Under Rule 5(a)(4), M.R.App.P., a Notice of Entry of Judgment is not required to begin 

the running of the time for filing a Notice of Appeal when a motion has been made under 

Rules 50(b), 52(b), or 59, M.R.Civ.P. When a timely motion under any of these rules is 

filed in the district court by any party, 

the time for appeal for all parties shall run from the entry of the order 

denying a new trial or granting or denying any other such motion, or if 

applicable, from the time such motion is deemed denied at the expiration 

of the 45-day [now 60-day] period established by Rule 59(d), Montana 

Rules of Civil Procedure. 

Rule 5(a)(4), M.R.App.P. 

A motion for reconsideration is not one of the motions referred to in Rule 5(a)(4), 

M.R.App.P. In fact, a motion for reconsideration is not one of the post-judgment motions 

provided for, or authorized, by the Montana Rules of Civil Procedure. Taylor v. 

Honnerlaw (1990), 790 P.2d 996, 997-98 (citing Anderson v. Bashey (1990), 787 P.2d 

304, 305). 

This Court has previously stated that a motion for reconsideration will not be equated to a 

Rule 59(g) motion to alter or amend a judgment unless the substance of the motion 

constructively requests the court to alter or amend the judgment. Miller v. Herbert (1995), 

135-36, 900 P.2d 273, 275. Instead, we will look to the substance of the motion to 

identify what motion has been presented. Miller, 900 P.2d at 275. Since Plaintiffs' motion 

for reconsideration is not one of the motions contemplated by Rule 5(a)(4), M.R.App.P., 

the 30-day limit allowed Plaintiffs to file their Notice of Appeal would not have begun to 

run with the denial of this motion. Robertson, 773 P.2d at 1216-17. 

Accordingly, we hold that Plaintiffs did file their Notice of Appeal in a timely manner. 

Affirmed. 

CHIEF JUSTICE TURNAGE, JUSTICES ERDMANN and GRAY concur. 

JUSTICE NELSON specially concurs. 

I agree with Justice Trieweiler's dissent in one respect. This case is about fairness. It is 

about the fairness inherent in simply applying the rules of civil procedure as they are 

written, instead of interpreting them in some strained fashion so as to allow one party to 

disregard the rules at the expense of the other party. The rules of civil procedure are not 
written to secure a tactical advantage to either the plaintiff or the defendant; rather, they 

are written to regulate the course of litigation, to level the playing field, and to move a 

lawsuit forward at something more than the glacial speed. The rules are there for both 

parties to read and to follow. If lawyers choose to conduct their practices in the eleventh 

hour, then neither they nor their clients should be particularly surprised when, whether 

through dalliance, neglect or lack of attention to the time limits clearly set forth in the 

rules, time eventually runs out. 

Characterizing and dismissing the majority's legal analysis as "sanctimonious," 

"pontification" and "mumbo-jumbo," while lending nothing to the development, to the 

understanding or to the exposition of the law, does reaffirm the uninformed and pervasive 

perception that many members of the public already have of lawyers, courts and judges 

as doing little more than dancing on pin heads. Moreover, this sort of sound-bite legal 

writing is guaranteed to provide easy copy for the press, editorial writers and talk-show 

hosts--especially those who could care less about reading, much less fairly and 

intelligently reporting, the opinion when there is a dissent full of one-liners to quote. 

However, it is precisely this sort of rule-from-the-gut and shoot-from-the-hip approach 

that produces result-oriented decisions like Livingston. That aside, until some higher 

power grants this writer the authority and omniscience to split the baby on some basis 

other than what, in this case, the rule clearly requires, I would rather simply apply the law 

as it is written, whether that is an intellectually detached exercise or not, and leave ruling 

from the gut to others. 

Finally, contrary to the dissent, it is not the majority opinion that has denied these 

litigants their day in court but, rather, it is the litigants' own failure to pursue their lawsuit 

with diligence and within the time limits unambiguously set forth in Rule 41(e). If those 

time limits or the requirements of the rule serve nothing more than to impose meaningless 

barriers to litigation, as the dissent seems to believe, then the rule should be changed. 

Unless and until it is however, Blaine Bank and Larsen have as much right to rely on this 

rule in their effort to avoid the expense and time of defending Haugens' lawsuit--a suit of 

questionable merit, in any event, given our prior decisions in Blaine Bank of Montana v. 

Haugen (1991), 816 P.2d 447, and in Blaine Bank of Montana v. Haugen (1993), 858 

P.2d 14--as Haugens had in bringing suit and in prosecuting this cause of action in the 

first place. 

JUSTICE GRAY joins in the foregoing special concurrence. 

JUSTICE LEAPHART, dissenting. 

I would not overrule Livingston v. Treasure County (1989), 781 P.2d 1129; therefore, I 

dissent from this Court's opinion and would hold that the District Court erred in 

dismissing the Haugens' claim for failing to file the return of service within the three-year 

time limit of Rule 41(e), M.R.Civ.P. 

In Livingston, the Court recognized that the purpose of Rule 41(e), M.R.Civ.P., is to 

ensure that actions are timely prosecuted. The Court then went on to explain how service 
of the summons is "indispensable to the timely prosecution of an action ...." The 

Livingston Court also acknowledged that: "Filing the return, on the other hand, is simply 

a ministerial act .... It is filed with the court only to document on the record the fact that 

service has been completed." The Court concluded that, "summary dismissal of this 

lawsuit for failure to file the return is not appropriate." Livingston, 781 P.2d at 1130-31. I 

believe that the rationale of Livingston is sound and I would not overrule that decision. 

Furthermore, it is patently unfair to overrule Livingston as it applies to the Haugens. The 

Haugens relied on our holding in Livingston. The Court reasons that adherence to 

Livingston prejudices the defendant and defeats the purpose of the Rule which is to 

promote diligent prosecution of claims once suit is filed. I fail to see how adherence to 

Livingston prejudices the defendant. Here, as in Livingston, the defendant has been 

served with process. It is that service of process (not the filing of the return of service) 

that triggers subsequent procedural steps such as the filing of the answer, Rule 12(a), 

M.R.Civ.P., or motions to substitute a judge under Secs. et seq., MCA. Thus, although it 

can be argued that failure to serve the summons and complaint within the proper time 

frame hinders the diligent prosecution of claims, the same cannot be said of failure to file 

the return of service. Whatever prejudice to the defendant that might arise from such a 

failure is more than outweighed by the prejudice to the plaintiff when the rationale of 

Livingston is overruled and he finds that he is forever barred from litigating his claim. 

The majority relies on First Call, Inc. v. Capital Answering Service, Inc. (1995), 898 P.2d 

96, 97, for the proposition that this Court now follows a strict statutory interpretation of 

Rule 41(e), M.R.Civ.P. However, First Call involved a failure to serve the summons not 

merely a failure to file the proof of service as in Livingston and the present case. The 

factual similarity between this case and Livingston gave the Haugens cause to rely on its 

precedent. Furthermore, although two other decisions were overruled in First Call, 

Livingston was not one of them. This further justifies the Haugens' reliance on 

Livingston. 

Additionally, the commissioner's notes to Rule 41(e), M.R.Civ.P., state that Rule 41(e) 

was amended in 1993 to comport with the mandate in Livingston. In Livingston the Court 

directed the legislature to conform the Montana Rule to the Federal counterpart which did 

not require return of service within three years. At the time of Livingston, Federal Rule 

4(g), F.R.Civ.P., stated that the "[f]ailure to make proof of service does not affect the 

validity of the service." Although the 1993 amendment to Montana Rule 41(e), 

M.R.Civ.P., did not accomplish the directive set forth in Livingston, (the Rule still 

requires that the summons be "served and filed with the clerk" within three years) the 

commission comments indicate that the amendment conforms Rule 41(e) to Livingston. 

These comments, although incorrect, gave the Haugens all the more reason to believe that 

Livingston was still good law. Haugens should not be thrown out of court for having 

relied on our decision in Livingston. 

The decision to overrule Livingston should be applied prospectively only. While 

"[j]udicial decisions have had retrospective operation for near a thousand years," (citing 

Kuhn v. Fairmont Coal Co. (1910), 215 U.S. 349, 372, 30 S.Ct. 140, 148, 54 L.Ed. 228, 
239 (Holmes, J. dissenting)) that retroactivity is based, in large part, on the fact that "[a] 

judicial construction of a statute is an authoritative statement of what the statute meant 

before as well as after the decision of the case giving rise to that construction." Rivers v. 

Roadway Exp., Inc. (1994), 511 U.S. 298, ___, 114 S.Ct. 1510, 1519, 128 L.Ed.2d 274, 

288-89. 

Retroactive application makes sense when a court is interpreting the statute for the first 

time, and is making a declaration of what the statute means now, as well as what it meant 

before the decision. However, retroactive application makes little, if no, sense when a 

court is overruling a prior decision which rendered an interpretation of that statute 

directly contrary to the present interpretation. In such circumstances, although a court 

may be declaring the meaning of the statute for future purposes, it cannot be said that the 

court is now declaring what the statute meant before the present decision. On the 

contrary, for the seven years immediately preceding the present decision, Rule 41(e), as 

interpreted by this Court in Livingston, did not require that the return of summons be 

filed within the three-year time limit. The traditional justification for retroactively 

applying this new "authoritative statement" of the law to the Haugens is absent. 

An exception to the general rule of retroactive application of judicial decisions should be 

invoked to prevent manifest injustice when, as here, a plaintiff is denied his day in court 

for having relied on judicial interpretations of procedural rules. 

The United States Supreme Court has recognized that the general rules of prospective and 

retrospective application of statutes and administrative rules may be suspended where 

injustice would be worked by their application in a particular case. See Thorpe v. 

Housing Authority of Durham (1969), 393 U.S. 268, 89 S.Ct. 518, 21 L.Ed.2d 474 

(recognizing an exception to the rule that appellate courts must apply the law in effect at 

the time it renders its decision to prevent manifest injustice); Landgraf v. USI Film 

Products (1994), 511 U.S. 244, ___, 114 S.Ct. 1483, 1502 n.29, 128 L.Ed.2d 229, 258 

n.29 (recognizing a "common-sense" exception to retroactive application of procedural 

rules, even those explicitly requiring retroactive application, so as not to work injustice, 

as in the case where "[a] new [procedural] rule concerning the filing of complaints would 

not govern an action in which the complaint had already been properly filed under the old 

regime ..."). 

The Haugens understandably relied on the "old regime," that is, this Court's interpretation 

of Rule 41(e) in Livingston and, as a result, were denied the opportunity to present their 

case before a tribunal of this state. To avoid this injustice suffered by the Haugens, this 

Court should invoke an exception to the general rule of retroactive application of judicial 

precedents and apply this decision prospectively only. 

JUSTICE TRIEWEILER and JUSTICE HUNT join in the foregoing dissent. 

JUSTICE TRIEWEILER dissenting. 

I concur completely with the dissenting opinion authored by Justice Leaphart. 
I write separately to respond to the majority's observation that its result is justified by its 

analysis of prior case law. If it was this Court which erred in Livingston v. Treasure 

County (1989), 781 P.2d 1129, where is it written that these litigants must suffer the 

consequences of its mistake? 

To me, the issue presented in this case is not what "authority" this Court has, based on 

what prior cases said under different factual situations about the retroactive application of 

judicial decisions. The issue presented in this case relates to simple notions of fairness, 

common sense, and respect for the members of the legal profession. The majority opinion 

shows a total disregard for any of these concerns. 

In the past, this Court has told attorneys that although service of the summons and 

complaint must be completed within three years from the date on which a complaint is 

filed, filing proof of that service is a mere ministerial act, and failure to accomplish filing 

of that document within three years does not require dismissal of the complaint. 

Livingston, 781 P.2d at 1130-31. Attorneys who understand this Court's role in 

fashioning rules of civil procedure, as well as its responsibility for interpreting them, had 

every bit as much reason to rely on that decision as they did on the literal language of 

Rule 41(e), M.R.Civ.P. Indeed, this same majority would be disappointed to learn that its 

decisions were ignored by the legal profession. 

Now, without the prior notice that the majority considers so important before even the 

most trivial amendment to the rules of procedure, the majority concludes that this Court 

was wrong when it decided Livingston. 

The majority says to practicing attorneys that if you relied on what we said in that case, it 

is too bad for you. Your client is out of court with no recourse. The merits of your client's 

case make no difference to us. 

No amount of pontification by the majority about retroactive application of judicial 

decisions can disguise its callous disregard for the rights of the litigants in this case. 

Cutting through the legal mumbo-jumbo in the majority opinion, the practical effect of its 

decision is simply indefensible based on any notions of fairness, common sense, or 

respect for the legal profession. 

According to the majority opinion, this Court previously misled attorneys by its decision 

in Livingston, and although we normally expect our opinions to be followed by the legal 

profession, it is too bad for them if they followed that decision. If private individuals 

engaged in similar conduct, we would be quick to invoke principles of estoppel to 

prevent the same injustice that has occurred in this case. It is disappointing, to say the 

least, that this Court demands less of itself than it expects from private citizens in the 

conduct of their private affairs. 

Equally disturbing is the intellectual detachment from reality represented by Justice 

Nelson's concurring opinion. It suggests that the majority does not have the foggiest 

notion what this case is really about. It speaks of one party disregarding rules "at the 
expense of the other party." It talks about "tactical advantages." It proclaims the need to 

"level the playing field," and "move a lawsuit forward." It never does explain, however, 

just exactly what the sheriff's return of service has to do with any of these lofty goals. 

For the majority's information, what we are talking about in this case is simply the time at 

which the affidavit of a process server is filed with the clerk of court. The affidavit serves 

absolutely no practical purpose unless at some point in the future some party disputes 

having been served with process. The failure to file it prejudices no one and provides 

neither party with a tactical advantage. The date on which the affidavit is filed has 

nothing to do with the progress of litigation. In fact, if the affidavit is never filed it would 

make absolutely no difference to anyone. 

What we are talking about in this case is the ultimate example of exalting form over 

substance. However, what is particularly offensive about the majority's purely intellectual 

exercise is that it comes at the expense of innocent people who were previously misled by 

the majority to believe that what they did was okay. The author of the majority opinion 

can excoriate the plaintiffs and their attorney as vitriolically as he wants, but cannot 

change the fact that they did exactly what they were told by this Court they could do. In 

all of the author's hyperbole, there is no mention of right and wrong. 

If the sanctimonious approach represented by the concurring opinion is what "real law" is 

all about, then this Justice would rather "rule from the gut." However, if it is any comfort 

to the author of the majority opinion, I doubt that this Court's decision regarding return of 

service will generate much interest from the press, or from anyone else, other than the 

parties affected. 

For these reasons, in addition to those expressed in Justice Leaphart's dissenting opinion, 

I dissent from the majority opinion. 

JUSTICE HUNT joins in the foregoing dissenting opinion. 

JUSTICE HUNT dissenting. 

I concur with everything that is said in the dissents of Justice Leaphart and Justice 

Trieweiler and make the following additional points. 

I. Refusing relief for such a minor error does not comport with the law's strong 

preference for trial on the merits. 

As the other dissenters have so ably pointed out, the error complained of in this case is a 

truly minor one. As in Aesop's Fables, the majority like the mountain gave a mighty 

rumble and, as in the fable, out came a mouse. The mouse in this case is the failure to 

document for the record the accomplishment of service of process, since the case does 

not address or affect the propriety of the service itself. Since the error alleged is 

obviously a purely procedural one, it should not out-weigh this Court's oft-stated 

preference for a trial on the merits. As we have explicitly stated, "[t]he policy of the law 
is to favor a trial on the merits." Hoyt v. Eklund (1991), 815 P.2d 1140, 1142. See also 

Johnson v. Murray (1982), 656 P.2d 170, 179 (Justice Shea, dissenting). 

In an analogous case, Justice Bistline of Idaho dissented from a majority decision to 

forcefully remind the Idaho Supreme Court of its mandate: 

[I]t has been well understood for over forty years that the policy of the 

Supreme Court has been, and hopefully will be, to foster the determination 

of legal controversies with the goal of administering justice. ... 

.... 

It has long been judicial policy in Idaho that controversies be determined 

and disposed of each on its own particular facts and as substantial justice 

may require. The exercise of judicial discretion should tend to bring about 

a judgment on the merits. ... There is, of course, a strong public policy in 

favor of hearing appeals on their merits and of not depriving a party of his 

right of appeal because of technical noncompliance where he is attempting 

to perfect his appeal in good faith. 

Gubler v. Boe (Idaho 1991), 815 P.2d 1034, 1039-40 (Justice Bistline, dissenting; 

citations omitted). Such a reminder is appropriately given to this Court as well. As the 

California Court of Appeals noted: 

trial of a cause of action on the merits is the cornerstone of our justice 

system and it is no wonder the law looks with disfavor on dismissal for 

procedural default. Such dismissal is even harder to swallow when the 

default is a mere technicality and the record evinces no intent by the 

appellants to willfully disrespect the court. 

Pacific Lining Co. v. Raging Waters, Inc. (Cal.Ct.App. 1991), 282 Cal.Rptr. 769, 781 

(citation omitted). 

The error complained of here is a mere technicality if there ever was one, and neither 

party suggests it was accomplished in an attempt to show disrespect either to the District 

Court or to this Court. With the foregoing in mind, I cannot see how tossing out an entire 

case before the merits are even approached, much less addressed, can be reconciled with 

the goal of administering justice. 

II. Refusing relief for such a minor error denies substantial justice. 

While the policy favoring a trial on the merits may be just that--a general policy--its 

underlying rationale is that every party who in good faith approaches a court of law is 

entitled to substantial justice. In Montana, the mandate that substantial justice be done is 

most often seen and most clearly articulated in cases which seek to set aside defaults and 

cases which seek to exercise long-arm in personam jurisdiction over out-of-state parties. 
See, respectively, In re Marriage of Shikany (1994), 887 P.2d 153; and In re Marriage of 

Lewis (1989), 784 P.2d 897. However, it is obviously a policy which is equally 

applicable in all cases. Certainly, no one would argue that any case is of so little import 

that substantial justice need not be done. Yet it has not been done in this case. Instead, the 

majority has used this minor procedural point to punish a party for almost missing 

deadlines in the past, an occurrence which is neither erroneous nor worthy of punishment. 

Furthermore, the very first rule of civil procedure dictates that the rules "shall be 

construed to secure the just, speedy, and inexpensive determination of every action." Rule 

1, M.R.Civ.P. (emphasis added). This too alludes to the indispensable and time-tested 

rule that courts must pursue substantial justice. 

Where is the substantial justice in the majority's disposition of this case? If we were 

addressing a rule of some importance, which many parties are ignoring and the disregard 

of which is adversely affecting the administration of justice by causing delay or clogging 

up the court systems, I could see the need to draw a firm line and make one transgressor 

an example to others who might contemplate the same actions. However, that is not the 

situation with which we are faced today. Instead, a party has been deprived of its day in 

court because of a minor technical error which did not, in and of itself, prejudice the other 

party in the least. I cannot agree with such a result. 

III. Factual "close calls" and the benefit of hindsight in this case are irrelevant to deciding 

the legal issue presented. 

The majority opinion makes much of the fact that the Haugens have closely approached 

various deadlines in the past, filing the complaint two days before the deadline for filing; 

issuing the original summons 30 days before the deadline; and issuing the amended 

summons one week before the deadline. I fail to see the relevance of these comments. In 

fact, the Haugens had never missed a deadline in the case until the minor procedural one 

which is at issue here. While they may have filed other documents later rather than 

sooner in the various periods allotted, they were free to file those documents at any time 

before the deadline--be it one year, one month, one day, or one hour. The majority seems 

to suggest that leaving such matters lie for a time will come back to haunt the parties, 

because this Court will infer neglect and prejudice even if the filing deadlines are in fact 

complied with. This is an unnecessary, misleading, and erroneous implication. 

The majority also notes the ease with which this error could have been avoided. This is 

also largely irrelevant. Hindsight is 20/20, and it is safe to assume that if the Haugens or 

their counsel had foreseen how this minor error would impact their case, they would have 

taken hasty and appropriate steps to prevent it from occurring. Clearly, the step of filing 

the summons with the clerk of court was simply forgotten. Therefore, it doesn't matter 

how easily the Haugens could have prevented this result had they remembered the step. 

In fact, due to the confusion in switching lawyers, it was inadvertently omitted. I find it 

ironic that the majority is not willing to cut the Haugens any slack in consideration of 

how minor this procedural point really is. It is, however, willing to condemn them further 

for the "ease" with which it might have been avoided, based on the presupposition that 
the error sprang from willful negligence instead of inadvertent neglect--a presupposition 

which is wholly unsupported by the record. 

In short, the majority may be following the black letter of the law in refusing to allow this 

case to proceed, but it has not heretofore been the general policy of this Court to rigidly 

adhere to that black letter at the obvious expense of equity and fairness. If, as I fear, this 

case stands for the proposition that form will now be exalted over substance and 

procedure over the merits, it appears that the rumblings in the majority opinion have 

given the fabled mouse far greater significance than Aesop ever intended. 

JUSTICES TRIEWEILER and LEAPHART concur in the foregoing dissent.