No. 13043 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1975 

MARY FRANCESCA PALFFY, 

Plaintiff and Appellant, 

DIRECTOR OF FINANCE OF THE CITY 

OF BOZEMAN and The City of Bozeman, 

Montana, 

Defendants and Respondents. 

Appeal from: District Court of the Eighteenth Judicial District, 

Honorable W. W. Lessley, Judge presiding. 

Counsel of Record : 

For Appellant : 

Bolinger and Wellcome, Bozeman, Montana 

H. A. Bolinger argued, Bozeman, Montana 

For Respondents: 

Berg, Angel, Andriolo and Morgan, Bozeman, Montana 

Ben E. Berg, Jr. argued, Bozeman, Montana 

,#A 1 

Filed: <:,:;7 *,', ' 

Submitted: September 11, 1975 
Mr. Justice Gene B. Daly delivered the Opinion of the Court. 

This is an appeal from a summary judgment granted by 

the district court, Gallatin County, in favor of the defendants 

Director of Finance of the City of Bozeman and the City of 

Bozeman. The district court at the same time denied plaintiff's 

motion for summary judgment. The case is based upon a special 

assessment for a sidewalk levied by the city of Bozeman against 

plaintiff's property. The case was heard, considered and decided 

entirely on the pleadings, consisting of the complaint and answer. 

Plaintiff's land within the city limits of Bozeman fronts 

on State Highway No. 191 which has a 100 foot wide right of way. 

There is 25 feet of unpaved right of way between plaintiff's 

property line and the highway pavement. The City ordered plaintiff to install a five foot sidewalk, ten feet from the paved 

portion of the highway and fifteen feet from plaintiff's property 

line within the right of way of the state highway. The highway 

department of the state was not involved in these proceedings. 

Plaintiff refused to install the sidewalk and the city installed 

the sidewalk and levied an assessment against plaintiff's land 

for costs in the amount of $10,360.07, to be paid in five annual 

installments of $2,072.03 plus interest of $153.49 or total installments of $2,225.52 each. Plaintiff protested the assessment 

and this action resulted. 

On appeal plaintiff's sole issue is that the district 

court erred in granting the summary judgment for the reason that 

the state highway department has exclusive jurisdiction to let 

contracts and control construction in or along the state highway 

right of way. 

The city concedes that all streets, including municipalities, are within the primary jurisdiction of the state of Montana. 

That the city acts upon authority granted by the state in the 
management of city streets and relies on section 11-2226, 

R.C.M. 1947, which provides authority to construct sidewalks, 

curbs and gutters without the formation of special improvement 

districts and the assessment of costs to the property "in front" 

of the construction. 

The city contends that section 32-2406, R.C.M. 1947, 

"General Power of [Highway] Department" does not usurp or revoke 

by implication any of the powers granted the city in section 

11-2226. Section 32-2406 reads: 

"The department may plan, lay out, alter, construct, 

reconstruct, improve, repair, maintain, and the 

commission may abandon highways on the federal-aid 

systems and state highways. The department may cooperate and contract with counties and municipalities 

to provide assistance in performing these functions 

on other highways and streets." 

The city reasons that section 32-2134, R.C.M. 1947, which 

gives exclusive control over signs and traffic control devices 

within municipalities does not mention sidewalks. The city concludes that it makes no difference that the state of Montana owns 

the street as all streets belong to the state of Montana and the 

city is but a trustee thereof. It cites Wood v. City of Kalispell, 

131 Mont. 390, 396, 310 P.2d 1058, for authority that the city is 

not precluded from building an improvement on a state highway. 

The city has a good case until it gets to ownership by 

the state. It is true the state as a sovereign owns all streets 

and local government units are trustees thereof. Yet, when ownership passes to a department of the state sovereign the broad general principles set forth by the state do not always apply or at 

least they are restricted or diminished. Wood, cited to us by 

the city, does stand for the proposition that a city can participate with the department of highways through a special improvement district. Wood also treats the aspect of highway ownership 

which the city failed to consider: 
"The provisions of the Federal Aid Road Act 

require that contracts for projects under that 

act must be let by the highway commission of the 

particular state, 39 Stat. 355, approved July 11, 

1916, as subsequently amended and supplemented, 

23 U.S.C.A., section 1 et seq. The legislature 

of Montana, by R.C.M. 1947, section 32-1609 

[since repealed, now section 32-24011, has 

assented to the terms of the Federal Aid Road 

Act and has authorized the highway commission 

to do all 'things necessary or required to carry 

out fully the cooperation contemplated by said 

act of congress * * * relative to the construction and maintenance of roads and highways in the 

State of Montana'. 

"R.C.M. 1947, section 32-1608 [since repealed, now 

section 82A-701.1(2)(4)], provides in part: 'All 

contracts for work on state highways shall be let 

by the state highway commission.' The project in 

the instant case involves two state highways, or 

more particularly, a portion of each of two state 

highways that is also used as a city street. Contracts for such work clearly must be let by the 

state highway commission. 

"This court, in State ex rel. State Highway Comm. 

v. District Court, 105 Mont. 44, 69 P.2d 112, and 

in Bidlingmeyer v. City of Deer Lodge, 128 Mont. 

292, 274 P.2d 821, recognizes that a city is but 

a subdivision or agent of the state and that by 

assenting to the provisions of the Federal Aid 

Road Act the legislature, as the principal, has 

withdrawn some of the powers previously given to 

its aqent, the municipality. 

"The legislative intent is clear that a city may 

create a special improvement district for street 

improvements ., where the street is also a part of a 

state highway and that, in such instance, the contracts for the work to be done must be awarded by 

the state hiqhway commission." (Emphasis supplied.) 

It must follow from the language cited that the power of 

the city can be diminished; that the city can participate with 

the state highway department but not independent of it. 

The fact situation here demonstrates the equity of the 

rule. Both parties agree that once the city constructed the improvement on the highway right of way, particularly 15 feet within its boundary line, that the highway department could order it 

removed with no recourse by the property owner or the city. 

The order granting summary judgment to the city of 
Bozeman is reversed and the cause remanded to the district 

court for further proceedings not inconsistent with this opinion. 

Justice 

/ fiief Justice