### NO. 80-376 IN THE SUPREME COURT 

### OF THE STATE OF MONTANA 1981

MALAN F. JOHNSTON, Plaintiff and Appellant,
-vs

### K & 

### T MANUFACTURING, INC., Defendant and Respondent.

Appeal from: District Court of the Thirteenth Judicial District, In and for the County of Yellowstone, The Honorable Robert H. Wilson, Judge presiding.
Counsel of Record:

For Appellant: Calton Law Firm, Billings, Montana For Respondent: 

### Woods and Moe, Billings, Montana

Filed: Submitted on Briefs: January 14, 1981 Decided: March 11, 1981.


## MAR

## I11%-Mr. JusticeFred J. Weber delivered the Opinion of the Court.

Plaintiff Malan F. Johnston (Johnston) appeals from the decision of the DistrictCourt of the ThirteenthJudicial 

### ~istrict, Yel.lowstone County, denying his claim for wages, penalties, attorney 

### fees and costs. Weaffirm the decision of the DistrictCourt. Johnston entered into an oral contract of employment with K & T Manufacturing, Inc. 

### (K & T)

## , a Wyoming-based corporation, on November 7, 1978. Johnston was hired to fly 

### K & T's executivejet airplane. There was no express 

### term of employment. Incidental expenses incurred by Johnston in theperformance of his duties

### werepaid by Johnston, and he
was reimbursed by 

### K & Tafter he submitted expense receipts. Johnston submitted a 

### set of periodic expense receipts total-ing $349.52 just prior to the termination of his employment. Johnston was firedon September 14, 1979. On September 15, 1979, he received a check for the full amount of wages owed him by 

### K & T. Five days later, September 20, Johnston filed suitagainst

### K & T. Johnston sued for $500 forunused vacation 

### time, $720.67 for employment expenses, $1,000 in
severance pay, $2,063.77 in statutory penalties for 

### K & T's failure topay money due, $2,167 inattorney fees, and costs of suit. On July 22, 1980, theDistrictCourt, sitting without a jury, found thatJohnston's allegations

### were unsupported by sufficientcredibleevidence, and that neither party was entitled toattorney fees orcosts. (K & T had counterclaimed for damages for Johnston's withholding of the keys tothe airplane afterhis discharge.) The Court also found that atthe 

### timeof hisdischarge Johnston was paid allsums due him from 

### K & Texcept for the disputed expenseclaims which were paid on December 18, 1979. K & T paid Johnston $171.46 on that date. This was the portion of the expense receipts submitted by Johnston that K & T found to be reasonable. Johnston argues that as a result of the payment of the $171.46, K & T should be required topay statutory penalties and attorney fees. Johnston's firstissue 

### iswhether the District Court erred innot holding K & T liable for statutory penalties as
a result of K & T's failure topay wages and monies due. The evidence showed that on the day of Johnston's discharge K & T owed a then undetermined sum for expenses incurred and paid by Johnston. The evidence further showed that K & T paid $171.46 toJohnston with a December 18, 1979, check. The check bore the notation "full expenses due." Johnston claims that thispayment was for "wages" as that term 

### is defined by section 39-3-201(5), MCA, which states: "'Wages' includes any money due an employee from the employer or employers, whether tobe paid by the hour, day, week, semimonthly, monthly or yearly and shall include bonus, piecework, tips and gratuities of any kind." Johnston argues thatreimbursement was notmade to him within sixdays asrequired under section 39-3-205, MCA, which establishes when wages 

### are tobe paid if an employee 

### is separated from employment prior to payday. Johnston further contends thatbecause reimbursement was not made within sixdays, the penalty of section 39-3-206, MCA, should have been imposed. That section inpertinent part provides: "Penalty for failure topay wages at

### times specified in law

# . .

# . A penalty shall alsobe assessed against and paid by such employer and become due such employee as follows: 

### a sum equivalent to the fixed amount of 5%of the wages due and unpaid shallbe assessed for each day, except Sundays and legal holidays, upon which such failure continuesafter the day upon which such wages were due, except that such failure shall not be deemed to continuemore than 20 days after the date such wages were due." We find that the $171.46 payment was not wages under section 39-3-201(5), MCA, or section 39-3-206, MCA. Such payment
was an "indemnification of employee" referred to in section 39-2-701 (1) 

## , MCA. There 

### isno statutorypenalty for the failure toindemnify an employee for expenditures covered by that section. We hold that the penalty for failure topay wages under section 39-3-206, MCA, does not apply to the $171.46 payment. The next issuepresented by Johnston 

### iswhether the trial court erred innot finding K & T liable for Johnston's attorney fees and costs under section 39-3-214, MCA: "Court costs and attorneys' fees. (1)Whenever 

### it isnecessary for the employee to enter or maintain a suitatlaw for the recovery or collection of wages due asprovided for by this part, a resulting judgment must include a reasonable attorney's fee infavor of the successful party, to be taxed aspart of the costs inthe case. "(2)Any judgment for the plaintiff ina proceeding pursuant to thispartmust include allcosts reasonably incurred inconnection with the proceeding, including attorneys' fees." As previously stated, the $171.46 payment was not a payment forwages. In addition, Johnston did not obtain a judgment forwages due so as to trigger the statutory requirement for
an award of reasonable attorney fees and costs. In fact there was no judgment for the plaintiff asrequired under the above code section. Johnston has failed tomeet the statutory requirements for attorney fees or costs. The District Court decided againstJohnston on both issues. The decision of the District Court 

### is affirmed.We concur: 

# '. Chief Justice