No. 12206 

IN THE SUPRENE COURT OF THE STATE OF MONTANA 

1972 

HUGH R. KELLEHER, 

Plaintiff and Respondent, 

-vs - 

STATE OF MONTANA & MONTANA AERONAUTICS COMMISSION, 

Defendants and Appellants. 

Appeal from: District Court of the First Judicial District, 

Honorable Victor H. Fall, Judge presiding. 

Counsel of Record: 

For Appellant : 

Anderson, Symmes, Forbes, Peete and Brown, Billings, 

Montana. 

Weymouth D. Symmes argued, Billings, Montana. 

Geoffrey L. Brazier, Helena, Montana. 

For Respondent: 

Small, Cumins and Hatch, Helena, Montana. 

Floyd 0. Small argued, Helena, Montana. 

Submitted: June 16, 1972 
Mr, Justice Gene B. Daly delivered the Opinion of the Co~xrt, 

This is a personal injury action brought by the manager of 

the Helena City-County Airport against the state of Montana and 

the Montana Aeronautics Commission for damages resulting from 

injuries received in an airplane crash, A jury in the district 

court of the first judicial district, county of Lewis and Clark, 

returned a verdict in favor of plaintiff in the amount of 

$245,000. Judgment was entered thereon, After denial of their 

motion for a new trial, defendants appeal the ftnal judgment, 

Plaintiff was returning from a meeting at Lewistown, Montana, 

which involved him in his capacity as city-county airport manager, 

when a Cessna 185 single engine aircraft owned by the Montana 

Aeronautics Commission and piloted by Charles Lynch, Executive 

Secretary of the Montana Aeronautics Commission, crashed, 

Plaintiff along with Henry Loble, general counsel for the Commission, was a passenger at the invitation of Lynch because the 

plane in which plaintiff had flown to Lewistown was not returning 

to Helena. All three men had been in attendance at a meeting 

of the Northern Plains Air Transportation Council in Lewistown. 

For the purposes of this appeal, defendants have assumed, 

in light of the jury's verdict, that the pilot Lynch was negligent in the operation of the aircraft. It is also agreed that 

plaintiff was covered by and received maximum workmen's compensation benefits , as hereinafter set forth in our discussion 

of issue No. 1, 

Defendants rely on three issues in support of their appeal: 

1, That the court erred in striking from defendants' 

amended answer its defense that plaintiff was an employee of 

the state of Montana, to-wit, manager of the city-county airport 

in Lewis and Clark County. The city-county airport carried 

workmen's compensation insurance and plaintiff was paid and 
accepted it, This was stipulated at trial and should have 

resulted in dismissal of the action. 

2. The verdict was so excessive so as to shock the conscience of an ordinarily prudent person. 

3, Numerous minor errors were committed during the course 

of the trial which in themselves would not be sufficient to 

constitute prejudicial error, but, when combined, would be 

sufficient to constitute prejudicial error. 

Defendants' issue No, 1 concerns their primary defense 

which they contend bars this action under the ~orkmen's Compensation Act. They rely specifically on section 92-204, R.C.M, 

1947, of that Act which provides in pertienent part: 

"Where both the employer and employee have elected 

to come under this act, the provisions of this act 

shall be exclusive, and such election shall be held 

to be a surrender by such employer and the servants, 

and employees of such employer and such employee, as among 

themselves, of their right to any other method, form 

or kind of compensation, or determination thereof, or to 

any other compensation, or kind of determination thereof, 

or cause of action, action at law, suit in equity, or 

statutory or common-law right or remedy, or proceeding 

whatever, for or on account of any personal injury to 

or death'of such employee, except as such rights may be 

hereinafter specifically granted 9~ * *. Provided, that 

whenever such employee shall receive an injury while 

performing the duties of his employment and such injury 

or injuries, so received by such employee, are caused 

by the act or omission of some persons or corporations 

other than his employer, or the servants or employees 

of his employer, then'such employee, or in case of his 

death his heirs or personal representatives, shall, in 

addition to the right to receive compensation under the 

Workmen's Compensation Act, have a right to prosecute 

any cause of action he may have for damages against such 

persons or corporations, causing such 8, *,I' injury, " 

(Emphasis supplied) 

In addition to preserving the common-law right to third party 

action to employees, this section also gives to the employer 

or insurance carrier paying the compensation the right of limited 

subrogation and the additional right to bring the third party 

action if the employee fails to do so within six months of his 

injury. 

We find no necessity to cite cases that interpret the 

I I intended meaning of the terms employer" and "employee" as used 
and defined in sections 92-410 and 92-411, R,C.M, 1947, of the 

~orkmen's Compensation Act. It is sufficient to point out that 

11 the general accepted definition of the term employed'is a person 

in service under any appointment or contract of hire, express or 

implied, oral or written, and considered as "actual" employment. 

In addition to the general class of employer and employee 

contemplated originally by the Workmen's Compensation Act, as 

noted above, the legislatures of the various states, including 

Montana, have by statute extended coverage under workmen's 

compensation to certain specific classes of employees who are not 

II actual employees" within the original definition discussed above, 

that is, they have no direct contract of employment, However, 

this coverage is usually extended to protect the employees of 

irresponsible and uninsured subcontractors or independent contractors. An equal basic purpose of the Act is to make the 

remedies provided exclusive under the Act and to insulate the employer, liable for compensation payment, immune from third party 

actions by the employee, Montana has done this in cases of 

statutory employers, some states have not, Sections 92-438, 

92-604, R.C.M. 1947. 

 arson's workmen's Compensation Law, V. lA, Ch. 9, 9 49.11, 

pp, 855-858, explains the rationale of this statutory extension 

of coverage: 

I1 The purpose of this legislation was to protect 

employees of irresponsible and uninsured subcontractors by imposing ultimate liability on the 

presumable responsible principal contractor, who 

has it within his power, in choosing subcontractors, 

to pass upon their responsibility and insist upon 

appropriate compensation protection for their 

workers. This being the rationale of the rule, in 

the increasingly common situation displaying a 

hierarchy of principal contractors upon subcontractors upon sub-subcontractors, if any employee 

of the lowest subcontractor on the totem pole is 

injured, there i-s no practical reason for rezching 

up the hierarchy any further than the first insured 

contractor. * * * 

 he statute also aims to forestall evasion of the 

act by those who might be tempted to subdivide their 

regular operations among subcontractors, thus escaping 
direct employment relations with the workers and 

relegating them for compensation protection to 

small contractors who fail to carry (and, if small 

enough, may not even be required to carry) compensation insurance. l1 (Emphasis supplied). 

It is important in the analysis of this problem to recognize 

that the rationale of the statutory employer-employee extension 

by the legislature is for the benefit of the employee and that 

such a benefit conferring a liability on the employer is coexistent with immunity from common-law liability. 

In the instant case it is clear that Charles Lynch, the 

negligent pilot, was an actual employee of the state of Montana 

and its aeronautics commission under the accepted definition 

heretofore discussed. 

It is equally clear that plaintiff under a contract of 

employment with the city-county airport is not an "actual" 

employee of the state of Montana under the accepted definitions. 

It does not appear that defendants contend plaintiff is an 

"actual" employee the same as the pilot; but, in a rather unusual 

multipronged approach, seem to contend that plaintiff falls 

I I into the position sf a statutory employee1; of the state of 

Montana or the state is a "statutory employer'bf plaintiff, 

although defendants never quite get to the terminology of 

statutory employer or employee, Defendants seem to contend 

"that the plaintiff, as manager of the city-county airport 

located near Helena, was a servant of an agency created by the 

State of Montana carrying out its governmental function. I I 

(Emphasis supplied), 

In another statement defendants contend that "the Cj-tyCounty Airport Commission was a sub-division of the State of 

Montane, and as such, the State of Montana and its Montana Aeronautics Commission were the actual employers of the plaintiff 

* * ;?. " (Emphasi-s supplied), Even with the one isolated reference 

to "actual" employment, the totality of defendants' language 

11 does not seem to urge actual employment" as used in the Act. 
There is no law i-n this state nor is any cited by defendants 

from other jurisdictions, that creates statutory employment by 

*n act of the legislature establishing an agency or commission, 

such as an airport commission, nor do the statutes cited 

giving the State Aeronautics Commission regulatory control over 

airport operation, create this legal. fiction, As discussed 

earlier, these creations must be found within the Act and the 

extinguishing of the common-law rights should be strictly construed. Madison v. Pierce, 156 Mont, 209, 217, 478 P.2d 860. 

In fact, section 92-410, R.C.M. 1947, cited by defendants 

It and which defines employer", specifi-cally permits thc "state 

and each county, city and county, city school district, irrigation district, all other districts established by law and all 

public corporations and quasi-public corporations and public 

agencies therein * * *I1 to be separate employers under the Act, 

Lacking statutory or case authority to establish an employeeemployer relationship, defendant$ position cannot be sustained. 

Defendants' issue No. 2 questions the amount of the verdict 

contending that such verdict was excessive and should be set 

aside, a new trial granted, or at the very least, the verdict 

should be substantially reduced. 

Defendants maintain plaintiff had preexisting disabilities 

which "prevented him from doing manual labor long before the 

aircraft accident with which we are concerned in this case". 

They also argue plaintiff "has recovered from all the injuries 

suffered by him except continuing discomfort of his back on 

occasions. 11 

On reading the entire record, including the testimony of 

lcwo docfors, pl.aintiffls coemployees, and plaintiff, we find: 

Plaintiff at time of trial was 44 years of age, married 

with three children aged 22, 15 and 11. He had a high school 

education and a life expectancy of 28.67 years. More than 25 

vears ago, at approximately age 16, plaintiff fell down an 

-levator shaft and injured his right leg, From that accident, 
he developed osteomyelitis in the leg, had several surgical 

operations and was left with "a fair amount of residuals in 

the leg." The net effect of that accident was a stiff knee, 

his right leg was shortened approximately one inch, and he 

walked with a limp. However, prior to trial af this action 

plaintiff had been free of any symptoms of osteomyelitis for 

a period of more than 13 years and had no compl.aints concerning 

his leg throughout that time. 

Plaintiff's employment record reveals he started working 

for the city of Helena after graduation from high school as a 

general laborer at various jobs including the water department, 

lighting department, and street department. Such work consisted 

of pick and shovel work, laying cable, and handling heavy equipment, He worked eight hours per day, six days per week and had 

no difficulty doing the work, Idhen plaintiff went to work for 

the city-county airport, he worked as general maintenance man 

plowing runways, mowing weeds,and other things connected with 

the general maintenance, He was promoted to the position of 

manager of the city-county airport which work was primarily 

administrative and management, although at times before the 

accident involved here he assisted with maintenance work in 

heavy rush periods. 

Following the accident, plaintiff was treated in the hospital by Dr, Bossler who had been plaintiff's family doctor for 

thirteen years. plaintiff's injuries as listed by Dr. Bossler 

included: multiple bruises throughout his body; laceration over 

one eye; injury to his right shoulder; some rib fractures; sore 

left ankle; injury to his right knee; compression fracture of 

the transverse process of L4 and a fracture of the spinous 

process of L4; bleeding from a cut on his head; fracture of 

the bones about the face and left zygomatic arch; and an injured 

finger. 

As a result of the injuries, plaintiff was placed in a back 

brace whi-ch he continues to wear most of the time; he has per- 
manent residuals of the back injury, finger injury, both legs; 

numbness to the left side of his head resulting from nerve 

injury to the side of his head; and headaches. Plaintiff regularly receives treatment in the form of painkillers. His condition is permanent and is compounded by emotional trauma caused 

by the injuries and the need for continued treatment to alleviate 

pain. 

Dr. Trobough of Anaconda, the other examining physician, 

testified that the compression fracture is a disabling injury 

which cannot be relieved or rectified by surgery. He also 

testified plaintiff had a permanent residual in the form of 

weakness in his shoulders, tiredness in his arms, accompanied 

I1 by a tingling and numbness which is just a strain pattern of 

the shoulders. I think it was just a strain pattern and the 

shoulders were strained. " 

Dr. Trobough gave the following testimony as to the 

compression fracture: 

It I think compression fracture of a vertebra causes 

considerable muscle spasm and ligamentous injury of 

the tissues around this vertebra, plus there is 

narrowing of the intervertebral space and there could 

be some evidence of compression injuries to the nerves, 

plus generally a lot of muscle spasm. Limitation of 

motton of the back is a result of these compression 

fractures, It 

Dr. Trobough also testified that the old injury to plaintiff's 

right leg had been definitely aggravated by the plane accident 

and with reference to the extent of plaintiff's disability he 

testified : 

"MY disability rating will be based mainly on the 

fracture of his back. Anyway, I said now two years 

and three months after the accident the patient is 

still having subjective complaints as a result of his 

injuries on September 23, 1969, They are, in my 

opinion, of a permanent nature and he will continue 

to require medical attention, care and medication. 

Any work that involves the use of the back, especially 

in the labor field or anything that causes even average 

manual labor, I feel he is 100 percent totally disabled. 

OR the basis of the above diagnosis, in my opinion, he 

has a 55 percent permanent disability, 11 
Plaintiff's coemployees, Mr. Richard McCord and Mrs. Dorothy 

Moe, testified that upon returning to his job after the accident 

of September 23, 1969, plaintiff was not able to perform any 

physical labor; that he is quite nervous and appears to be 

suffering most of the time; he cannot sit for very long; that he 

is short-tempered and frequently hreaks out in a rash on his arms 

when he is nervous; and, that here are repeated tnstances of his 

being in pain, 

Defendants have raised the issue of plaintiff's condition 

with emphasis on his preexisting inability to engage in manual 

labor prior to this accident attributed to his fall 25 years ago, 

Yet, defendants offered no evidence to controvert plaintiff's 

evidence of years of manual labor following the fi.rst injury nor 

did they offer evidence to controvert his present condition. 

Defendants had plaintiff examined by an orthopedic surgeon, 

Dr, Harris Hanson of Helena, but failed to submit the results of 

that examination of plaintiff to the jury, As a result, the 

record contains some claimed inconsi-stencies elicted on medical 

cross-examination of plaintiff's medical witnesses but such inconsistencies do not overcome plaintiff 's evidence to a degree 

that the jury did not have before it substantial credible evidence upon which it could render its verdict, 

In addition to preexisting disability, defendants base their 

argument of excessive damages primarily on the contention that a 

review of a1.l of the cases decided by this Court does not reveal 

a jury verdict of this size. They argue that this Court over 

the years has been confronted with hundreds of personal injury 

cases with in juries sllbs tanti-a lly more severe than those suffered 

by plaintiff here, but there have been no verdicts this large, 

Defendants cite to this Court for comparison of damage awards, 

Sheehan v. DeWitt, 150 Mont, 86, 430 P,2d 652, which held a 

county attorney struck in the face was not entitled to $1,500 

because no treatment was required and it was not a serious injury; 
and Jewett v. Gleason, 104 Mont. 63, 65 P,2d 3, a - 1937 case 

where a $12,000 verdict on a back injury case was reduced by 

These arguments fail to recognize the criteria which governs 

the examination of damage awards by this Court, This Court and 

the Federal Courts in applying Montana law recently have spoken 

in unison in this area with clear and concise language, Smith v, 

Kenosha Auto Transport, 226 F,Supp, 771, 774, (D,C.Mcznt, 1964); 

Strong v, Williams, 154 Mont, 65, 71, 460 P. 2d 90; Sal-vail v. 

Great Northern Ry,, 156 Mont. 12, 31, 473 P,2d 549, 

In Smith, in the contest of an $180,000 award, the Federal 

Court stated: 

1 I The medical evidence in this respect is largely uncontradicted, the only question raised by defendants 

being whether the condition was caused by the accident or pre-existed the accident in view of the diagnosis 

of a convulsive disorder in the plaintiff a year preceding 

the accident. The fact remains that after the previous 

diagnosis, the plaintiff recovered and performed well 

as both a worker, and a husband and father until his 

injury in the accident, In addition, there was positive 

medical testimony to the effect that plaintiff's condition at the time of trial resulted from the injuries 

received i.n the accident and/or the aggravation of a 

previous condition, which in itself was not disabling in 

the least. There was also medical testimony that plaintiff's condition is permanent and progressive. I I 

The Court in answer to the contention that the award was excessive, went on to say: 

"The foregoing also applies to defendants' contention 

that the verdict is so excessive that it must have 

resulted from passion and prejudice. It is only when 

the amount of the verdict is such as to shock the 

conscience of the court or to cause the court to believe it was the result of sympathy, passion or prejudice, or that the jury, in fixing the amount of 

damages, was motivated by factors that should not have 

been taken into consideration, that the court may set 

aside a verdict. [Citing cases] This rule announced so 

often in federal courts is also the rule followed by 

the Montana Supreme Court. Sullivan v. City of Butte, 

117 Mont, 215, 157 P.2d 479; Brown v. Columbia Amusement Co,, 91 Mont, 174, 6 P,2d 874; McCartan v, Park Butte 

Theater Co., 103 Mont. 342, 62 P,2d 338; Thompson v. 

Yellowstone Livestock Commission, 133 Mont, L03, 324 P.2d 

412, From the summary of the evidence and what has been 

said above, it is apparent that the amount of the verdict 

does not shock the conscience of the court, and the court 

does not believe the amount of the verdict was influenced 

by passion or prejudice, sympathy, or any other improper 

considerations. I l 
In Strong, this Court stated: 

I I In personal injury actions there is no fixed measuring 

stick by which to determine the amount of damages, other 

than the intelligence of the jury; that the jury is 

allowed a wide latitude and unless it appears the amount 

awarded is grossly out of proportion to the injury as to 

shock the conscience, this Court will not substitute its 

judgment for that of the jury, especially where, as here, 

the trial court has approved the verdict by denying the 

motion for a new trial," (Emphasis supplied), 

In Salvail, the Court entered this restatement: 

"It is idle to cite cases from this or other jurisdictions on awards by juries for certain injuries as no 

two cases are alike and each case turns on its own facts. 

In 11 A.L.R,3d there are 713 pages of cases for comparison. 

"The amount to be awarded as damages is properly left 

to the jury and this Court rill not substitute its - 

Judgment for that of the jury particularly where, as 

here, the trial court has approved the verdict b 

denying a new trial. Strong v. Williams, 154 Mo:t. 65 

P.2d 90. It is only where the amount awarded is so gr 

, 460 

-0s sly 

out of proportion tb the injury as to shock the conscience 

that this Court will intervene. In the instant case the 

verdict of $125,000 is not so grossly out of proportion 

to the injury as to shock our conscience nor induce a 

belief that it was the product of passion or prejudice, 

Thprn i c: nnthin~ whatanbver in the- record to indicate A*.-&- A" ..---------- --- ---- - - 

assion or prejudice; on the contrary, there is a substan- 

!Fa1 - evidentiary - basis .. justifying the amount of the award." 

(Emphasis supplied). 

Here, the jury has made its award for physical damages 

caused to a 44 year old plaintiff with a life expectancy of 

28,67 years, He must endure those injuries for that time, The 

trial court has refused to grant a new trial. We find nothing in 

the record to indica.te the jury was motivated by factors which 

should not have been taken into consideration, such as passion, 

prejudice or sympathy, In light of the times and the growing 

awareness within the legal processes that has attempted to conform 

damage awards to the extent of the injuries sustained, the amount 

of the verdict does not shock the conscience of the Court and 

we find no error, 

Defendants1 issue No. 3 requires no extended discussion. 

They contend that a series of errors occurred during the trial 

none of which, standing alone, would be sufficiently prejudicial 

7" J* to authorize a new trial, but the totality of which consituted 
manifest prejudice to defendants, requiring a new trial. The 

errors to which defendants direct our attention are: (1) Alleged 

speculative opinion evidence by expert witness Hamer that the 

moist condition of the spark plugs found in the wreckage of the 

aircraft several hours after the accident might have been caused 

by flooding resulting from a prolonged power-off glide to a 

lower altitude and a subsequent application of the throttle, 

(2) Testimony of expert witness Leaphart that there were a lot 

of places in the vicinity of the crash site where "you could 

touch down an airplane in that area and come out of it reasonably 

unscathed." (3) Undue concern by the trial judge for plaintiff's 

physical condition and comfort while testifying, 

Items (1) and (2) are irrelevant to this appeal in any 

event, They refer only to the issue of the pilot's negligence, 

Defendants concede this issue on appeal. This is demonstrated 

11 by the following statement in their brief: However, in the 

light of the jury's verdict, we shall assume for the purposes 

of this brief on appeal only that [the pilot] was negligent in 

the operation of the aircraft, 1 I 

Item (3) likewise is without merit, The trial judge simply 

advised plaintiff that if he wanted to stand up at any time while 

testifying to do so, and that if he needed a recess to say so. 

Defendants' attorney was similarly solicitous of plaintiff's 

physical condition in like manner, and raised no objection at 

the trial to the judge's remarks, Under such circumstances the 

claim of prejudicial error upon appeal is without substance. 

The judgment of the 
Mr. Justice Wesley Castles dissenting: 

I dissent. I shall not dwell at length on the matter 

but will observe that the Workmen's Compensation Act, in my 

vim, forecloses an action by an employee of one state agency 

against another state agency. Both agencies involved here 

8r~ creatures of the Legislature, both financed by public 

tax monies. 

Additionally, on issue No. 2, I c~ould grant a new trial 

because the damages awarded are excessive. Here we have an 

employee in a managerial position who has in fact returned 

to work and hns had a salary increase since his return. In 

his position he is fully able to do the job and a quarter of 

a million dollar judgment shocks my conscience. I would 

grant a new trial. 

~ssoci63 \ Justice.