No. 14215 INTHE SUPREME COUIZT OF THE STATE OF MONTANA 1978

NOF?EEF!N PLAINS RESOURCE

### COUNCIL

### AND NOIiTHEEW CHEYENNETRIBE, 

### INC., Petitioners and Respondents,

-VSBQARD OF NATURAL RESOURCES

### AND CONSEFWiTION, 

### et al., Respondents and Appllants.

Appeal from: DistrictCourt of the First

### JdicialDistrict, Honorable Gordon R. Bennett, Judge presiding. Counsel of Record: For Appellants: W. H. Bellingham argued, Billings, Pbntana John L. Peterson argued, Butte, PJbntana 

### Richard Andriolo argued, 

### Bozeman, I4mta.m WuriceF. Hennessey argued, Butte, lbntana C. W. Leaphart, Jr., Helena, Pbntana NeilS. Keefer, Billings, Fbntana John W. Ross, Butte, PJbntana For Respondents: Leo C. Graybill, Jr. argued and GregoryWarnerargued, GreatFalls,

Pbntana For 

### Amicus Curiae: Benjamin W. Hilley argued, Great Falls, Pbntana D. Patrick ?&Kittrick, Great Falls, Pbntana

Sulsanitted: October 24, 1978 5 + &= Decided: 

# : 193 Filed: -- -,.q ,'3Mr. 

### Justice John Conway Harrison delivered the Opinion of the Court. Pursuant totheMontana Major Facility SitingAct, 

### section 70-801 et seq., R.C.M. 

### 1947, now section 75-20-101 et seq. MCA 

### (hereinafter "SitingAct")

## , the Board of Natural Resources and Conservation (hereinafter "Board of Natural Resources"), on July 22, 1976, granted to the Montana Power Company, Puget Sound Power and Light Company, Portland General Electric Company, theWashington Water Power Company, and Pacific Power and Light Company (hereinafter "Utilities"), a certificate of environmental compatability and public need for the construction of the facility known

as ColstripUnits 3 

### and 4. 

### Respondents and cross-appellants appealed thisdecision to the First

### Judicial District Court, Lewis 

### and Clark County, under the provisions of the Montana Administrative Procedure Act, section 82-4201 etseq., R.C.M. 

### 1947, now section 2-4-101 et seq. MCA 

### (hereinafter "MAPA"). The DistrictCourt reversed and remanded the matter to theBoard of Natural Resources for rehearing. From thisorder both 

### appellants/cross-respondents and respondents/cross-appellants appeal tothisCourt. The two appeals have been consolidated for hearing and decision. To properly indicate themonumental proportions this matter

### has taken, 

### webelieve it is 

### necessary to setforth itsbackground in some detail aswas done by the Board of Natural Resources inits 

### findingsof fact, conclusions of law, 

### opinion, decision, order and recommendations. This alsowill

### help toilluminate the issues on appeal and place thiscontroversy is

### perspective. Pursuant tothe termsof the SitingAct, on June 6, 1973, the Utilities filedwith theMontana Department ofNatural Resources and Conservation (hereinafter "Department of Natural Resources") an application for a certificate of environmental compatibility and public need for the proposed ColstripUnits 3 and 

### 4. Filed contemporaneously was a petition forwaiver of 

### timerequirements as 

### set forth in section 70-806, R.C.M. 1947, now section 75-20-211 MCA, and

a filing feeof $1,232,930. The Utilities also filedwith the Department of Natural Resources their environmental analysis of the proposed project and related facilities entitled "Colstrip Generation and Transmission Project." This environmental analysis

### was dated November 1973 and 

### was prepared by the environmental systems department of Westinghouse Electric Corporation. The Department of Natural Resources, pursuant to sections 70-807 and 70-816, R.C.M. 1947, now sections 75-20-216 and 75-20-503 MCA, of the SitingAct, conducted an extensive study over a period of 600 days of the application and issued 

### its draft environmental impact statement inNovember 1974, recommending against the granting of the application. Subsequent toissuing the draftenvironmental impact statement, the Department of Natural Resources conducted a 

### series of public meetings togain input from the public regarding the proposed project and the analysis thereof contained in the draft environmental impact statement. On or about January 21, 1975, the Department of Natural Resources 

### released its final environmental impact statement on the proposed project containing 

### itsrecommendations against granting the application and transmitted the same to the Board of Natural Resources. The Board of Natural Resources, on receipt of the recommendations from the Department of Natural Resources andafter due and deliberate consideration, issued an order dated January 24, 1975. In 

### its order the Board of Natural Resources deemed that thematter before 

### it, 

### i.e., the application for a certificate of environmental compatibility and public need for the proposed ColstripUnits 3 and 

### 4, would be considered a contested case asdefined inMAPA, section 82-4201 etseq., R.C.M. 1947, now section 2-4-101 

### et seq. MCA. Subsequent to issuing this order, the Board of Natural Resources issued orders on February 7, 1975 and February 14, 1975, pertaining tomatters of procedure tobe followed, particularly referring to themethods of discovery and determining the burden of proof. The Board of Natural Resources further ordered that the hearing would commence on March 10, 1975, atBozeman, Montana. Notice of the time and place of the hearing was given toallparties and published indaily newspapers throughout Montana to inform the public. On March 

### 10, 1975, the hearing began, 

### atwhich time motions 

### were presented to the Board of Natural Resources by the opponents of the application to continue the hearing until May 13, 1975, toafford the parties time to complete discovery procedures. Also, objections 

### weremade toa member of the Board of Natural Resources serving ashearings examiner. On ~pril 17, 1975, the Board of Natural Resources continued the hearing until April 21, 1975, and on April 10, 1975, Carl M. ~avis was appointed by the Board ashearings examiner topreside over the public hearing phase of the proceedings. Following a pretrial conference with the parties, the hearings examiner, by order dated April 15, 1975, directed the proceedings toreconvene on April 21, 1975, 

### at~elena, Montana.By 

### letter dated April 10, 1975, the director of the Department of Health and Environmental Sciences (hereinafter "~epartment of Health") notified the Board of Natural Resources that the Department of Health certified that the proposed facility

### willnot violate stateand federally established

### water quality standards. It did not certify that the proposed facility

### willnot violate stateand federally established airquality standards and implementation plans. On April 18, 1975, the Northern Plains Resource Council filedCause No. 38934 inthe District Court of Lewis and Clark County. A 

### writof prohibition was served upon the Board of Natural Resources and the hearings examiner, directing them todesist and refrain from any further proceedings until further order of the court and further directed them toappear incourt on April 22, 1975. Following the hearing the court, on April 29, 1975, quashed the

### writof prohibition, thereby allowing the hearing tocontinue. The court further ordered the Board of Health and Environmental Sciences (hereinafter "Board of Health") tohold a hearing to determine whether the certificate required by section 70- 810(1)(h)

## , R.C.M. 1947, now section 75-20-301(i) (h) MCA, should be issued. The hearing was reconvened inHelena on May 5, 1975. Motions by the opponents for further continuances 

### were presented and granted by the hearings examiner, continuing the hearings untilMay 20, 1975. On May 9, 1975, theNorthern Cheyenne ~ribe, Inc., filed an application for a 

### writof prohibition inthe is

### trict Court of Lewis and Clark County, Cause No. 39000. This matter was heard by the court on May 19, 1975, andjudgment was entered on the same date dismissing the application. The public hearing before the Board of Natural Resources formally began on May 20, 1975, and continued until June 5, 1975, atwhich 

### timethe hearing before the Board of Health was commenced with Carl M. Davis serving 

### as hearings examiner. The hearing before the Board of Health consumed a total of 53 hearing days and concluded on September 15, 1975 with 53 witnesses having testified. After studying the testimony and exhibits, and the findings of fact submitted by the parties, the Board of Health heard oral arguments by counsel, visited the 

### site of the proposed facilities and rendered 

### its decision on November 21, 1975, issuing 

### its conditional certification, pursuant to section 70-810(1)(h), R.C.M. 1947, now section 75-20-301(1)(h) MCA, of the Siting Act. On July 23, 1975, atthe conclusion of Utilities' casein-chief inthe Board of Health hearing, the opponents to the application moved todismiss the Utilities' proceedings for certification, together with a motion to continue further hearings until the Board of Health ruled upon the motions. The motion to continue the Board of Health hearing

was denied on July 24, 1975. The opponents to the application filed inthe DistrictCourt of the FirstJudicial District, Cause No. 39228, an application for a 

### writof prohibition ormandate commanding the Board of Health and the hearings examiner tocease and refrain from further proceedings until further order of the court or to show cause tothe court why the Board of Health should not be permanently restrained from further proceedings until the ~oard had ruled upon opponents' motion todismiss.On July 25, 1975, this Court granted the 

### Utilities' application for a 

### writof supervisory control and directed the 

### ~istrict Court to either withdraw 

### its

### writof prohibition or, inthe alternative, to appear before the Supreme Court on July 28, 1975. On July 28, 1975, this Court heard thematter, and atthe conclusion of the hearing directed that the

### writof prohibition be 

### set aside and that the hearings proceed. The hearings examiner for the Board of Natural Resources issued an order dated December 10, 1975, recovening the Board of Natural Resources' hearing on January 19, 1976, atHelena. In addition he setforth certain procedures to be followed by allparties to the proceedings regarding the presentation of directtestimony and cross-examination. Notice of the time and place of the hearing was served on allparties and published indaily newspapers throughout the state toinform the public. The Department of Natural Resources and the Northern Plains Resource Council filed motions with the Board of Natural Resources, moving the Board toterminate 

### its hearing on the basis that the Board of Health had not certified, or had miscertified, that the proposed ColstripUnits 3 and 

### 4 would 

### meet applicable 

### air and water quality standards. After a hearing, the motion

was denied. The reconvened hearing commenced on January 19, 1976, and was concluded on March 30, 1976. A total of 255 

### witnesses testified, including 132 public witnesses. The transcript of the proceedings inboth the Board of Health hearing and the Board of Natural Resources hearing, consistingof approximately 17,000 pages, including copies of the exhibits received into evidence, 

### were served upon eachmember of theBoard of Natural Resources together with the parties' proposed findings of fact. he Board of Natural Resources visited and inspected the proposed facilities on two occasions. After due and timely notice being served and published, 

### it heard oral arguments on May 19 and 20, 1976, by allparties who were present and desired topresent arguments. The Board of Natural Resources having inspected the 

### site, read the record of the proceedings and the proposed findings of factof the parties, and heard the arguments of counsel and public parties, and having duly considered the

same and being fullyadvised inthe premises, announced ina regularly scheduled and noticed meeting on June 24, 1976, that 

### it

### was ready to actupon the application. A motion to approve the application toconstruct ColstripUnits 3 and 4 and associated facilities and to grant applicants a certificateof environmental compatibility and public need, subject tocertain stated conditions, was seconded and carried with four members voting infavor of themotion and threemembers voting against themotion. A majority of the Board having approved granting the application, the Board made 

### its findings of fact and conclusions of 

### law, together with 

### itsdecision, opinion, order and recommendations. It granted the certificate of environmental compatibility and public need tothe utilities on July 22, 1976. ~espondents/cross-appellantsappealed to the ~istrict Court of Lewis and Clark County, which reversed and remanded thematter to the Board of Natural Resources, ~ppeal to this Court from the District Court's opinion 

### is taken by 

### all parties.

### Before discussing themany individual issues inthis case, there are several other matters which require emphasis by thisCourt. Section 82-4216(7), R.C.M. 

### 1947, now section 2-4-704 MCA, 

### enacted in 1971asa partof MAPA, 

### establishes the standards of judicial review of contested agency decisions. The foregoing subsection commences by stating that the court shall not substituteits

### judgment for that of the agency as tothe weight of the evidence on questions of fact. It 

### continues by providing that the courtmay reverse ormodify the agency decision if substantialrights of the appealing party have been prejudiced because the administrative findings, inferences, conclusions, or decisions are: (a)

### in violation of constitutionalor statutory provisions; (b) in

excess of the statutory authority of the agency; (c)made upon unlawful procedure; (d) affected by other error of law; (e)clearly erroneous inview of the reliable, probative and substantial evidence on thewhole record; (f)arbitrary or capricious or characterizedby abuse of discretion orclearly unwarranted exercise of discretion; or (g) because findings of fact, upon issues essential tothe decision, were not made although requested. It 

### is

### clear from this statute that theburden resting upon an appealing party to a ~istrict Court from an agency decision is a 

### substantial one. This Court recently set forth three basic principles underlying section 82-4216 which a District

### Court must consider indetermining what the scope of review of an administrative decision should be: (1)

### that limited judicialreview of administrative decisions strengthens the administrativeprocess by encouraging the fullpresentation of evidence atthe initial administrativehearing; (2)judicial economy requires court recognition of the expertise of administrative agencies inthe field of their responsibility; and (3) limited judicial review 

### is necessary to determine that a fairprocedure was used, thatquestions of 

### lawwere properly decided, and that the decision of the administrative body was supported by substantial evidence. vita-~ich Dairy, Inc. v. Department of Business Regulation (1976), 170Mont. 341, 553 P.2d 980. A recent United States Supreme Court decision has a greatdeal to say on the subject of judicial review of agency decisions. The Court expresses 

### itsviews on the practice of some federal judges inplacing themselves inthe place of the agency inmaking the decision, rather than following the correct course and setting aside agency decisions only for substantial procedural or substantivereasons



### as mandated by statute. InVermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc. (1978), 435 U.S. 519, 98 S.Ct. 1197, 55 L Ed 2d 460, the Supreme Court unanimously reversed a decision of the Court of Appeals for the Districtof Columbia Circuitwhich had overturned the Atomic Energy Commission's decision 

### to grantVermont Yankee



### a license tooperate a nuclear power plant. The Court of Appeals ruled that the rule-making procedures of the AEC 

### were inadequate despite the fact that the agency had employed allthe procedures required by the Federal Administrative Procedure Actand more. The Supreme Court concluded that the Court of Appeals had seriously misapplied statutory and decisional law cautioning reviewing courts against engrafting their own notions of proper procedures upon agencies entrustedwith substantive functions by Congress, 435 U.S. 

### at 525, and that "[albsent constitu-tional constraints orextremely compelling circumstances the 'administrative agencies "should be free tofashion their

own rules of procedure and topursue methods of inquiry capable of permitting them todischarge their multitudinous duties.

### "

## '



# . 

# .."Vermont Yankee, 435 U.S. at543. In cautioning the lower court tojudge an agency decision by the appropriate standards of review, the Supreme Court noted that the lower court should "not stray beyond the judicial province toexplore the procedural format or to impose upon the agency 

### its own notion of which procedures



### are 'best' ormost likely tofurther some vague, undefined public good." 435 U.S. at549. The court left

### littledoubt in stating: 

# ".

. 

# . the role of a court inreviewing the sufficiency of an agency's consideration of environmental factors 

### is a limited one. limited both by the 

### timeatwhich the decision was made and by the statutemandating review. "'Neither the statute 

### -- nor 

### its legislativehistory contemplates

## -- that a court should substi- tute 

### itsjudgment for that of the agency as to 

### -- ---- -- the environmental consequences of 

### its actions.' 

## ----- [Citationomitted.]" Vermont Yankee, 435 U.S. at555. (Emphasis supplied.) As tonuclear energy, the Court pointed out that Congress had made a choice toatleast trynuclear energy, establishing a reasonable review process inwhich courts are toplay only a limited role. 

### "

# . 

# . .The fundamental policy questions appropriately resolved inCongress and inthe 

### state legislatures are

### not subject toreexamination inthe federal courts under the guise of judicial review of agency action. 

# . ." 435 U.S. at558. The Court concluded with the strong language: 

# ".

. 

# . It 

### is to insure a fully informed and well-considered decision, not necessarily 

### a decision thejudges of the Court of Appeals or of this Court would have reached had they beenmembers of the decisionmaking unit of the agency. Administrative decisions should be 

### set aside inthis context, asinevery other, only for substantialprocedural or substantive reasons asmandated by statute, Consolo v. FMC, 383 U.S. 607, 620 (1966), not simply because the court isunhappy with the resultreached



# . . ." 435 U.S. at558. Because somany of the issues in this 

### case involve the findings of atleastone board below, 

### we review briefly what thisCourt has stated regarding the rules of construction applied tofindings of fact. In Ballenger v. Tillman (1958), 133Mont. 369, 324 P.2d 1045, this Court stated that ultimate facts, 

### as distinguished from evidentiary ones, are the findings a trialcourt should make. Findings are toreceive such a construction 

### as 

### willuphold, rather than defeat, the judgment. This Court quoted with approval a California case to the effectthat there 

### isno error inthe failureof a trialcourt tomake an express finding upon an issue if 

### it

was implicit inthe findingsmade, and that there 

### is no necessity tonegate contradictory allegations. Ballenger was quoted with approval inErickson v. Fisher (1976), 170Mont. 491, 554 P.2d 1336, where the Court rejected a proposed finding of factoffered by the appellant because 

### it was merely an evidentiary factasdistinguished from an ultimate fact. It has been stated another way that findings are sufficient if they dispose of material issues. 76 Am Jur 2d, Trial, 51259; 89 C.J.S. Trial, 5626. This 

### is applicable to court trials, and it isobvious that stricter rules should not be imposed upon administrative agencies. This record contains some 17,000 pages of transcript; hundreds of exhibits, including 

### a monumental "environmental analysis"; and hundreds of proposed findings of fact and

### conclusions of law. The findings of factand conclusions of law of the Board of Health 

### are 23 pages long, and those of theBoard of Natural Resources run 46 pages. Approximately 300 pages of briefs were submitted. Many of the questions involved require firstimpression decisions astothe requirements of theMAPA and of the SitingAct. 

### Due tothemany issues presented, their complexity, and thevoluminous pages of transcript, we 

### find it 

### impractical to set forth the entire statement of facts ina single portion of thisopinion. Further necessary and appropriate factswill

### be discussed with each issue. The issues presented to thisCourt, as 

### agreed toby the parties and addressed by the District Court, are: 1. 

### Whether the District

### Court's ruling thatprohibition of cross-examination of agency witnesses violated constitutional standards, statutes, and regulations, was error? 2. 

### Whether the Board of Health proceedings, record, transcript, exhibits, findings, conclusions and orders in the Board of Natural Resources record is 

### subject toreview? 3. Whether the District Court erred inrequiring the Board of Health toconsider stateor federal implementation plans inreaching certificationpursuant to section 70- 810(1) 

### (h)

## , R.C.M. 

### 1947, now section 75-20-301 (1) 

### (h)MCA? 4. 

### Whether theDistrictCourt erred inrequiring the Board of Health tomake findings and conclusions asto whether certain airand water

### quality standardswould be 

### complied with, and whether the facilitieswould have a major impact on ground water quality? 5. 

### Whether the DistrictCourt erred inrequiring the Board of Natural Resources toconsider and make adequatefindings of fact and conclusions of law with respect to whether the facilities

### willresult intheminimum adverse environmental impact? 6. Whether the DistrictCourt's ruling that the Board of Health isrequired tocertifywithout condition, compliance with 

### air and 

### water quality standards and state implementation plans, was error? 7. Whether the District Court properly ruled that the Board of Natural Resources be required toconsider and make adequate findings as tothe siting and location of the transmission corridor for the 430 

### milesof transmission lines? 8. Whether the District Court erred inholding that there was not substantial credible evidence tosupport the Board of Natural Resources' findings, conclusions, and decision that the proposed facilityrepresents theminimum adverse environmental impact? 9. Whether the District Court properly accepted and ruled thatparties tothe petition 

### were adequately served? 10. Whether the Board of Natural Resources properly denied a motion todeny the applicationbased on the Board of Health's miscertification ornoncertification of the air and water qualitymatters required under section 70-810(1)(h), R.C.M. 1947, now section 75-20-301(2) (h) MCA? 

### 11. Whether theBoard of Natural ~esources' refusal to consider theminimum adverse environmental impact as to requiringmore efficient technology for the removal of SO2 and the DistrictCourt's opinion affirming thatrefusal is

error under the SitingAct? 12. Whether the refusal of the Board of ~aturalResources toallow 

### itsmembers the opportunity toreviewfindings of factand conclusions of law prior to adoption, and the DistrictCourt's affirming that decision, was arbitrary and capricious on the part of the agency and a deprivation of petitioners' constitutional rights to due process and a full and fair hearing before the Board? The firstissue tobe addressed 

### is Issue No. 9--whether the District Court properly accepted and ruled that parties tothe petition 

### were adequately served. We believe that 

### it did. While the District Court did not make a specific ruling as to the effectuation of proper service on all parties, it surely 

### isclearly implied by 

### its various pretrialorders and by 

### its final order reversing and remanding. Surely neither the Utilitiesnor the agency appellants/ cross-respondents have any standing tocomplain about service inthismatter. Any complaint they might have had was waived by agreeing tothe delineation of issues which 

### were finalized by the District Court's order of February 27, 1977. It 

### is contended by the Union and REA, appellants/ cross-respondents, that they are each "parties of record" for the purposes of section 82-4216 (2)

### (a)

## , R.C.M. 1947, now section 2-4-702 MCA, of the MAPA, and thereby entitled to individual service of a copy of the petition of review. We find that the Union and REA 

### were not indispensable parties under the circumstances entitled to individual service of a copy of the petition of review. Compare, Cissell v. Colorado StateBd. of Assessment App. (Colo. 1977), 564 P.2d 124, and Life of the Land v. Land UseComn. (1977), 58 Haw. 292, 568 P.2d 1189. They were jointly represented by counsel and the International Brotherhood of ElectricalWorkers, an active participant inthe agency proceeding 

### was actually servedwith a copy of the petition for review. Had these appellants/cross-respondents communicated with one another, they would have had actual knowledge of the petition, if they did not have suchknowledge from their counsel or the newspapers. Wedo not feel that judicial review of the Board's action should be thwarted by a party not participating in

### a proceeding, even though 

### it had knowledge of 

### it, and later allowed to complain that the court had no jurisdiction over thematter. The motion of the Union and REA todismiss this proceeding 

### ishereby denied. Issue No. 

### 2 

### willbe considered next. This issue could

more properly be phrased by asking whether the decision of theBoard of Health was a finaldecision under the provisions of section 82-4216, R.C.M. 1947, now section 2-4-702 MCA, of the MAPA, and, if so, whether an appeal of such order 

### ismandatory orpermissive. On pages 16 and 17 of 

### its order, the District Court held that the granting of the Board of Health certification should properly be viewed 

### as a "preliminary, procedural or intermediate agency action" which 

### is not reviewable because review of the final agency action (i.e., thatof the Board of Natural Resources) provides not only an adequate remedy but the only necessary remedy." The District Court held that the Board of Health certification had no legal effect whatsoever until and unless the Board of Natural Resources granted its certificationunder section 70-804, R.C.M. 1947,

now sections 75-20-201 and 75-20-203 MCA. The court concluded that the Board of Health decision could not be appealed until the Board of Natural Resources granted a final certificateof environmental compatibility.Section 82-4216, R.C.M. 1947, now section 2-4-702 MCA, provides: 

### "(1) (a) A person who has exhausted alladministrativeremedies available within the agency and who is aggrieved by a final decision in a contested case

### isentitled tojudicial review under thispart. This section does not 

### limit utilization of orthe scope of judicial review availableunder other means of review, redress, relief, or 

### trial de novo provided by statute. A preliminary, procedural, orintermediate agency actionorruling 

### is immediately reviewable if review of the final agency decision would not provide an adequate remedy." The issue then 

### iswhether ornot the decision of the Board of Health dated November 21, 1975, certifying that ColstripUnits 3 and 

### 4 would not violate stateand federally established standards and implementation plans, 

### was a final decision under theprovisions of theMAPA and, accordingly, should have been appealed to the DistrictCourt by the petitioners atthat 

### time. Section 70-810 

### (1) (h)

## , R.C.M. 1947, now section 75-20- 301(l)(h)MCA, provides that the Board of Natural Resources may not grant a c e r t i f i c a t e u n t i l 

### it determines that the authorized state

### air and 

### waterquality agencies have 

### certified that the proposed facility

### willnot violate state and federally established standards and implementation plans. There 

### is no question that the Board of Health 

### is the duly authorized state

### air and 

### waterquality agency inthis case. Section 70-810, R.C.M. 1947, now section 75-20-301 MCA, further provides thatjudgments of the authorized airand water quality agencies "are conclusive" on allquestions relating tothe satisfaction of stateand federal air and 

### water quality standards. The Board of Natural Resources had

no authority toreview the decision of the Board of Health under any circumstances. Accordingly, the Board of Healthorder 

### was not a preliminary orinterlocutory order. Itwas final for allpurposes. Thus, an appeal should have been made by petitioners atthat time. The fact that the Board of Health's certification was not the finalorder inpoint of 

### timeinthe proceedings 

### is not conclusive on the question of appealability. 

### "

# . .

# . For purposes of judicial review the finalityof an agency order depends upon the nature of the order rather than 

### its chronology inrelation tothe whole of the agency proceedings. 

# . 

# ." Goodman v. Public Service Commission, (D.C. Cir. 1972), 467 F.2d 375, 377, citing Federal Power Comm'n v. Metropolitan Edison Co. (1938), 304 U.S. 375, 384, 58 S.Ct. 963, 82 L.ed. 1408. Goodman involved 

### a hearing before theWashington, D.C. Public Service Commission concerning a petition for a rate increase. The hearing was bifurcated into two "phases." In 

### itsPhase I order, thePSC established the fairrate of return at7.1 percent. The Power Company 

### was then ordered to submit proposed schedules to increase 

### its revenue accordingly. The PSC Phase I1 order was an order effectuating the above directiveby approving a schedule of rates. Goodman appealed from the Phase I order and not the Phase I1 order. The federal districtcourt dismissed the appeal holding that the Phase I order was not a finalorder or decision and that Goodman 

### was not affected until entry of the Phase I1 order. The Circuit Court of Appeals reversed, holding that the Phase I order was a final order: 

# ".



# . . Its final character is inno sense affected by the need for the 

### later Phase I1 order allocating the increase among the several differentcategories of customers. The increase inrates, and the findings of the Commission upon the basis of which the increasewas allowed, 

### were inno way leftfor further decision by the Phase I1 order.

"While 

### it is true that inour case there was something 

### else for the Commission to do, the validity of the over-all increase [Phase I] was not conditioned upon anything yet tobe resolved by the later order authorizing tariff schedules. What remained tobe done 

### was not concerned with the validity of the increase 

### in

### rates which had been granted--the action of the Commission which Mr. Goodman took tocourt. That action 

### 'was expected toand did have legal consequences' which were not modified nor intended tobe modified by the Phase I1 order which followed. [Citing cases.]" Goodman, 467 F.2d at377-78. As with the PSC Phase I order inGoodman, the Board of Health's certification

### was not conditioned upon anything yet tobe resolved by the later order of the Board of Natural Resources. The remaining administrative procedures were not concerned with air and water quality certification. The Board of Health order inthisregard w3.d final and conclusive. The Board of Health's action "was expected to and did have legal consequences" which were neither modified nor intended tobe modified by the later order of the Board of Natural Resources. The Board of Health's order of November 21, 1975, marks the consummation of the administrative process within that particular agency. The Board of Health's decision was final for purposes of judicial review and should have been appealed atthat 

### time. "The principle of finalityinadministrative law 

### isnot, however, governed by the administrative agency's characterization of 

### its action, but rather by a realistic assessment of the nature and effect of the order sought tobe reviewed. Hence, 'a finalorder need not necessarilybe the very 

### last order' inan agency proceeding, but rather, is final for purposes of judicial review when it 'impose[s] an obligation, den[ies] a right, or fix[es] some legal relationship as a consummation of the administrative process.' 

# .. ." Fidelity Television, Inc. v. F.C.C. (D.C. Cir. 1974), 502 

### F.2d 443, 448.We 

### find that the Board of Health's order of November 21, 

### 1975, was finalon thatdate. An appeal from that order had tobe filedwithin thirty days thereafter pursuant to the terms

### of theMAPA. 

### No appeal was timely filed and, therefore, the District

### Court was without jurisdiction to review the order. The District

### Court is

### reversed accordingly. Inview of the factthat thisCourt has ruled that the District 

### Court was

### without jurisdiction toreview the Board of Health's order dated November 21, 

### 1975, the following issues become moot and need not nor can be decided by us: IssueNo. 3 

### involving the alleged failureof the Board of Health toconsider stateand federal implementation plans; Issue No. 4 

### concerning the requirement thatthe Board of Health make additional findings and conclusions concerning certain airand water standards; and Issue No. 6 

### which raised the question of the validity of the conditional certificate issued by the Board of Health. Issue Nos. 10, 11 

### and 12 involve issues wherein respondents/cross-appellants contend the District 

### Court erred. IssueNo. 10questions the denial by the Board of Natural Resources and the concurrence of the District

### Court of respondents/cross-appellants' 

### motion todeny the application because of faultycertificationby the Board of Health. We 

### find that the District

### Court properly concurred inthe denial of themotion. On January 7 

### and 8, 

### 1976, respondents/cross-apellants 

### filedmotions toterminate theproceedings before the Board of Natural Resources on the grounds of the alleged invalidity of the certificationof the facilityby the Board of ~ealth. The Board of Natural Resources denied themotions.Under the provisions of section 70-810 

### (1) (h)

## , R.C.M. 1947, now section 70-20-301(2)(h) MCA, of the Siting Act, the Board of Health 

### isrequired to certify to the Board of Natural Resources 

# ".

. . that the proposed facility

### willnot violate stateand federally established standards and implementation plans 

# .

# . ."This was done by the Board of Health

on November 21, 1975. The grant was called a "conditional certificate," but that qualification has no significance for the purposes of this issue. The above section of the Siting Act provides further that the judgments of the Board of Health

# ".

. . are conclusive on allquestions related to the satisfaction of stateand federal air and 

### water quality standards." (Emphasis added.) Therefore, from a statutory standpoint alone, the Board of Natural Resources had no choice but to look upon the certificationby the Board of Health as "conclusive" and deny the motions of respondents/ cross-appellants. There 

### is an even more compelling reason why the Board of Natural Resources was justified indenying the motions. The certification and order of the Board of Health was dated November 21, 1975. Weheld under Issue No. 2 that such certification and order was a "finaldecision ina contested case" and subject tomandatory judicial review within thirty days after 

### its issue. The motions of respondents/crossappellants 

### were not filed until January 7 and 8, 1976, well beyond the thirty-day period for judicial review, thus making the certification and order of the Board of Health doubly "conclusive" not only upon the Board of Natural Resources but alsoupon the District Court. The remedy available to

### respondents/cross-appellants on this issue of certification by the Board of Health 

### was to institutejudicialreview within the statutory thirty-day period.Issue No. 

### 11 concerns the District Court's upholding the refusal of the Board of Natural Resources torequire

more efficient technology for the removal of SO2 atthe facility inconsidering minimum adverse environmental 

### impact. This issue solely involves questions of fact thoroughly reviewed by the Board of Natural Resources before making 

### its findings, conclusions and orders. In their briefs both 

### appellants/cross-respondents and 

### respondents/cross-appellants argue about highly technical matters, which more properly should be presented before the administrative agencies. We believe the DistrictCourt decided the

### matter properly, and 

### itsreasons were adequately stated atpages 34 and 35 of 

### its opinion: 

# ".



# . . The disagreement seems to ariseover the assertion by applicants that BACT can be equated to the highest stateof the artor tominimum adverse environmental impact. Petitioners insist the latter 

### sets a higher standard that BACT and that the evidence here shows the pollution 

### removal equipment proposed does not

### meet that standard. Inmy opinion, the BACT, or NSPS and PSD, standards areempirical and quantifiable and are 

### set out specifically inthe EPA regulations. These should be determined by the Department of Health, as that department attempted todo here. On the other hand, the determination 

### as to whether various aspects of the proposed facility 

### willprovide minimum adverse environmental 

### impact (orrepresent the highest stateof the art) 

### is a judgmental matter, requiring comparison, the weighing of several factors and the balancing of pros and cons. This 

### is the business of the Board of Natural Resources. (Inthis case, Finding of Fact #79 of the Board of Natural Resources 

### sets forth some, or 

### allof the factors considered.) 

### Here thepetitioners argue that the evidence provided by the witness Brink shows clearly that the highest stateof the artwould provide 90% removal of SO2. The applicant points out that Brink's technology applies to

### a high sulfur coal installationwith an open loop settling system. The proposed facilitytakes advantage of low sulphur coal and a closed loop system thatwould 'trade off' higher sulfur emission (purportedly within NSPS and PSO standards) for minimization of water pollution. Thus, the type of pollution control equipment proposed by the applicantsapproved by the Board of Natural Resources may contribute to a total system thatprovides minimum adverse environmental impact. Such an express conclusion asapplied tothe pollution control equipment would have been helpful; but it can be fairlyimplied from the findings of both Boards. It can certainly be deemed tocome under the allencompassing statement inFinding of Fact #3and Conclusion of Law #4 of the BNR certification. It 

### seems to

### me the conclusion on thisparticular aspect of the case has been adequately stated and that 

### it is not 'clearly erroneous', although 

### it would have benefited from more substantial factual findings to support it." The District Court's holding on this issue was not in

error. Issue No. 12raises the point as towhether the refusal by the Board of Natural Resources toallowmembers toreview findings and conclusions prior toadoption was a deprivation of 

### respondents/cross-appellants' rights to due process and 

### a fulland fairhearing before the Board of Natural Resources. We find no such deprivation. A review of the District Court opinion indicates that 

### it actually did notmake any ruling on this point. And, a review of the record also indicates that respondents/crossappellants did not raise this issue inthe District Court. Therefore, it cannot be raised for the first

### timeon appeal to this Court. Wehave repeatedly held that we 

### willnot consider questions of claimed error not previously raised or presented to the trial court. Hayes v. J.M.S. Const. (1978), Mont. 

## , 579 P.2d 1225, 35 St.Rep. 722; Mont. Ass'n 

### - of Underwriters v. State, Etc. (1977), 

### -Mont. - 

## , 563 P.2d 577, 34 St-Rep. 297; Kearns v. McIntyre Const. Co. (1977) Mont. 

## , 567 P.2d 433, 34 St.Rep. 703. Wepoint out, however, that inour opinion there was no deprivation of rights or even unfair practices inthe adoption of findings and conclusions by the Board of Natural

### Resources. A 

### reading of the entire separate volume of transcript regarding procedural 

### matters before the Board of Natural Resources dated July 22, 

### 1976, clearly demonstrates this.The record indicates thatprior to themeeting of the Board of Natural Resources inJune 1976, each board member prepared his own 

### set of findings and conclusions, after which a vote was taken atthe June 1976 meeting "as towhich route they would choose." Following the vote, the hearings examiner was requested by the Board 

### toprepare findings of the majority, which had voted to approve the application. On July 8, 

### 1976, two weeks prior tothe finalmeeting of July 22, 1976, a letterwas sent toeach board member with a copy of the hearings examiner's proposed findings of fact, conclusions of 

### law, opinion, decision, order and recommendations. The hearings examiner requested that he be notified of any changes any member wanted made. The hearings examiner noted that there

### were some changes tobe made such as spelling and typographical errors, and some provisionswere changed. These findings and conclusions 

### were adopted by the Board of Natural Resources simultaneously with the granting of the certificate of environmental compatibility and public need. Under these circumstances the Board of Natural Resources' action could not be held tobe arbitrary and capricious, or a deprivation of respondents/ cross-appellants' constitutionalrights to due process and

a fulland fair hearing. IssueNo. 5 

### involves the DistrictCourt's requirement that the Board of Natural Resources make additional findings and conclusions regarding the use of ~osebud coal versus McKay coal and themine-mouth versus load-center generationquestion. The DistrictCourt admits there was ample 

### testimony on both points but insists the statutory findings and conclusions that the facilities

### willmeet the "minimum adverse environmental impact" 

### test of the SitingAct, as required by section 70-810(l)(c), R.C.M. 1947, now section 75-20-301(2) (c) MCA, must be accompanied by a "precise and explicit statement of the underlying facts supporting the findings" asprovided under the 

### terms of theI~APA,section 82-4213, R.C.M. 1947, now section 2-4-623 MCA. We agree. In connection with the Rosebud versus McKay coal point inthis issue, the DistrictCourt held that the Board of Natural Resources did not make adequate findings of fact and conclusions of 

### lawregarding whether the use of only Rosebud coal, without the use of any McKay coal, represented the minimum environmental impact. The testimony indicates there

areextensiveMcKay coal deposits inthe same area asthe Rosebud coal deposits. The use of one coal seam to the exclusion of the other could, of course, result in an increased effectof the impact of stripmining and reclamation. The lack of any specific findings inthisdisputed factual area, directly affecting the environmental impact of the facility,was error on the part of the Board of Natural Resources. The 

### District Court properly held that a concise and explicit statement of the underlying findings of fact



### was necessary to support the ultimate conclusion. gardi ding the second point inthis issue, the 

### ~istrict Court held that the Board of Natural Resources be required tomake adequate findings of fact and conclusions of law with regard to:

### "(b)Whether mine-mouth generation 

### as opposed to load center generation represents minimum environmental impact, and the reasons therefor, including considerations 

### as torelative energy efficiency and the relativeimpact of electrical transmission versus coal haulage, both asrequired by Section 70-810(l)(c)." 

### AppelLantd/cross-respondents maintain that only ultimate factual conclusions need be drawn by the Board of Natural Resources and underlying supporting findings of fact



### are not required. Such a position 

### is contrary tothe

### requirements of MAPA. Section 82-4213, R.C.M. 1947, now section 2-4-623 MCA. The issue 

### isprimarily one of whether clear-cut alternatives inthe evidence need be considered inthe findings by the Board of Natural Resources inreaching the statutory conclusion that the facilities

### will

### meet theminimum adverse environmental impact. The Board of Natural Resources made

no findings, for example, astowhether the economic detriment, if any, in

### terms of depreciated land values and effect

on business and commerce, caused by the taking of 430 

### miles of double right-of-way across the Stateof Montana versus theutilizationof existing railroad right-of-way satisfied theminimum impact 

### test. The District Court ruling that theBoard of Natural Resources be required tomake findings asto the "nature and economics of thevarious alternatives," as 

### set forth in section 70-810(1)(c), R.C.M. 1947, now section 75-20-301(2)(c) MCA, was proper and inaccordance with applicable law. Issue No. 7 questions the DistrictCourt's requirement that theBoard of Natural Resources make additional findings

as tothe siting and the location of the transmission line corridor. The DistrictCourt held that the Board of Natural Resources made inadequate findings as to the environmental

### criteria and the identification and designation of the transmission line corridor as required by the IIIAPA in section 82-4313, R.C.M. 1947,now section 2-4-623 MCA. The transmission line, as a part of the facilities, calls for the location of approximately 430miles of rightof-way for two 500 k.v. transmission lines from Colstrip to the western boundary of the state. The District Court held that the Board of Natural Resources was required to "clearly designate a transmission line corridor, make findings of fact as to why the Board preferred the chosen corridor to the alternative corridors, and conclusions of law as to what state and local legal requirementsmust be met, and whether they have in factbeen met, in accordance with Section 70-810(1)(f)." We concur. Appellants/cross-respondents 

### point out the apparent inconsistency of the District Court's opinion wherein the court refused to consider the lack of findings as to the environmental impact of the alternative corridor segments, and its final ruling set forth above. Although the opinion could be clearer in this regard, it is apparent that the District Court rejected respondents/cross-appellants' 

### argument on the issue of minimum adverse environmental impact as to the alternative corridors. However, the District Court refused to affirm the granting of a certificateby the Board of Natural Resources, without some actual identification of the corridors subject to approval. With respect to the transmission facilities,appellants/ cross-respondents' Exhibit 92 

### sets forth a number of alternative segmentswhich, in combination, could make up possibly five or six different routings, rather than 54 alternative routes as suggested by appellants/cross-respondents. 

### ~lso,

### respondents/cross-appellants submitted proposed findings on the preferability of alternativecorridors, particularly the

use of existing railroad right of way over the routes 

## --- proposed by 

### appellants/cross-respondents. BNR Proposed Findings N.P.R.C. #13-16, 32, 34-36, 66-69, 104-105, 108, 115. DNRC #814-820. The findings of fact touching on this issuewere conclusory innature and presented no basis orunderlying supporting facts for the conclusion reached. See Board of Natural Resources Finding of Fact No. 48. Furthermore, ina subsequent finding, No. 74, the Board of Natural Resources found that further meteorological data 

### was necessary for a determination of a final selection of 

### -- the "proposed corridor." (Emphasis supplied.) The conclusions of law go no further than tomake a reference inone of the conditions to a "proposed corridor." Board of Natural Resources Conclusion of Law No. 12 

### (L)(3). As stated by the DistrictCourt, the pertinent findings of factand conclusions of law with respect tothe transmission facilities 

### are totally conclusory innature with respect totheir location. Furthermore, they failto actually reach the conclusion that a transmission route has been located. This 

### is, of course, the fundamental purpose of the entire agency process. Section 82-4213, R.C.M. 1947, now section 2-4-623 MCA, provides inpart: 

# ".

. . Each conclusion of law shallbe supported by authority orby a reasoned opinion.

### " ~ppellants/cross-respondentsallude to citations of the record to satisfy the essential fact-finding obligation of the Board of Natural Resources with respect tothe requirement that the location conform to stateand local laws and regulations (section 70-810 

### (1) (f) R.C.M. 1947, now section75-20-301(2) 

### (b) MCA). The District Court correctly held that the identification of the laws determined to be complied with was necessary to support Conclusion of Law No. 8. The 

### ~istrict Court inthis instance could not substitute 

### its judgment for the agency inthe absence of any definitive decision by the agency. 

### ~ppellants/cross-respondents' contention that references inthe findings to the fact that the transmission lines would be located to avoid population centers asmuch as possible, without even a consideration of what population centers 

### were involved, the effect of the impact, or the corresponding benefits, if any, does not satisfy the factfinding obligation of the Board of Natural Resources. Finally, subsequent approval of a segment of centerline has no bearing on thevalidity of the Board of Natural Resources with respect to location of a corridor. The fact thatmembers of the Board of Natural Resources may subsequently identify a centerline location does not aid the incompleteness of the Board of Natural Resources' determination with regard toa corridor location. The 

### District Court properly found that something more than conclusory findings of factor conclusions of law was necessary tomeet therequirements of the SitingAct with respect to location of transmission line facilities, especiallyof themagnitude sought by 

### appellants/cross-respondents. We now turn toIssue No. 8 concerning the District Court's finding as towhether therewas substantial credible evidence tosupport the Board of Natural ~esources'findings, conclusions and decision that the proposed facilityrepresents theminimum adverse environmental impact,The parties inthismatter phrased this issue as to whether the DistrictCourt erred inholding there 

### was not substantial evidence to support a finding of minimum adverse environmental impact. A careful reading of the District Court opinion indicates that such a statement of the issue 

### is not correct. The District Court in

### its decision on this issue 

### set forth nine differentheadings. The District Court

on all the headings except possibly number 8 ruled infavor of the utilities. It found there was substantial credible evidence to support the Board of Natural Resources' findings, conclusions and decision that the proposed facility represents the minimum adverse environmental impact. Concerning number 8 theDistrictCourt held there 

### is substantial evidence but then beclouds the issue by adding, almost parenthetically, that the Board of Natural Resources did not support 

### itsultimate conclusion with any findings as to underlying facts. We find that the language concerning supporting ultimate facts 

### is surplusage as far as this issue 

### isconcerned. We agree with the District Court and find that there is substantial credible evidence inthe record to support the Board of Natural Resources' findings, conclusions and decision that the proposed facilityrepresents the minimum adverse environmental impact. The final issue for this Court todecide and probably themost far-reaching with regard toadministrative law in this state, isIssueNo. 1--whether the District Court erred inholding that the Board of Natural Resources must provide 

### respondents/cross-appellants the opportunity tocrossexamine witnesses of the Department of Health and the Department of Natural Resources inthe hearings before each ~oard.The 

### ~istrict Court in

### itsdecision and order held that the hearings examiner erred inruling that parties opposing the utilities' application could not cross-examine witnesses called by other party opponents inboth the Board of Health and Board of Natural Resources hearings. We disagree. To fully comprehend the nature and reason for the ruling, we examine the background of the proceedings prior to the ruling. After reading the record and the briefs inthis case, the position of themain parties inthe two hearings becomes obvious early. On the one side were the proponents consisting of the utilities as applicants. On the other side

were the opponents to the application consisting of Northern Plains Resource Council, Northern Cheyenne Tribe, Inc., the Department of Natural Resources and the Department of Health. Each of the above opponents was represented by separate counsel. With interest

### we note that when 

### it came 

### time to submit to the Board of Health proposed findings of fact and conclusions of law, as well ascomments on the utilities' proposed findings of fact and conclusions of 

### law and final memoranda, the four main opponents submitted joint pleadings--not separateones, each pleading being signed by the four separate counsel representing each main opponent. In fact, the title of each pleading designates the four parties

as "opponents" tothe application. Any attempt to cast doubt upon the division of parties into distinctproponents and opponents, asthe DistrictCourt attempted to do in

### its opinion and order of March 3, 1978, iswithout,merit. No one involved inthe proceedings expected an early conclusion, yet it soon became apparent that the proceedings could lastformonths unless stepswere taken to shorten the

### hearings, For example, the firstwitnesses called averaged

over five days of testimony each, including extensive crossexamination by attorneys for the four main opponents to the application. Extended discussions among the attorneys and the hearings examiner ensued inan effort tobreak the impasse. The apprehension of the hearings examiner became more noticeable asthe proceedings progressed. Thus, early in the hearings he noted that the Board of Health proceedings



### were inthe second week and the second witness was still 

### on the stand. At

### the beginning of the second month of hearings, four witnesses had not yet been completed. Finally, the hearings examiner ruled that allwitnesses would thereafter present their testimony inwriting, and that the opponents toany witness would have sixhours of cross-examination 

### time, divided among them as they might agree. The hearings examiner further reserved the right to permit additional cross-examination if 

### itwas material and if without 

### itprejudicemight occur. A 

### limitation was also placed upon redirect and recross examinations. Approximately a month later, and after the utilities had rested their case-in-chief, objections were made by the opponents tonot being allowed tocross-examine witnesses called by other opponents. At

### that time, the hearings examiner ruled thatno party opposing the application would be allowed tocross-examine witnesses presented by any other party opponent. However, there was at

### leastone exception to the rule expressed atthe time, 

### and followed thereafter, inthat counsel forNorthern Plains Resource Council was allowed tocross-examine Department of Health witnesses as to the water aspects of the case because the Department had

### indicated that 

### it could certify that the project would meet allapplicable 

### state and federal water standards. With this position, Northern Plains did not agree. The comments of the hearings examiner on this subject

aremost illuminating, including his comments as towho opposed the application. Inresponse to a question as to whether ornot the chair had ruled that the Northern Plains Resource Council could not cross-examine a Department of Natural Resources' witness, the hearings examiner stated: "HEARINGS EXAMINER: 

### That's correct, except on matters pertaining towater. It's 

### my understanding atthe outsetof this thing, 

### we line up on two sides, proponents and opponents. NOW, 

### there was some conversation that you weren't lined up that way, but the chair, the Hearings Examiner, has observed throughout these proceedings that all the attorneys from the opponents' side have been inand out of the conference room, sharing exhibits, passing notes, conferring between examinations, and if there's a question one forgot to ask, he confers and the next guy asks 

### it, and I've never heard of a proceeding where you take the sideof an opponent to an application and you cross-examine the other opponent's witnesses." Could the hearings examiner have made it 

### any clearer as to the division of the parties? We 

### think not. Justification for the rulewas stated by the hearings examiner asfollows: "HEARINGS EXAMINER: 

# . . 

# . It 

### seems to

### me that the only person who has the right to cross-examine is 

### the person who 

### ison the opposite side. I 

### think that's the function of cross-examination. If it 

### weren't thatway, this new rule

### wemade could be very nicely abused. In other words, theApplicants take two hours on cross-examination, the other parties, on the other side, we go back on the merry-go-round we've been on. You'll have an adequate opportunity toput inyour client's case in full, with asmany witnesses asyou choose, and stateyour position very firmly, and they'll have a right tocross-examine your witnesses. I 

### don't contemplate granting the DNR the right tocross-examine your witnesses when they're 

### - not inan adverseposition tothem. That's not 

### -- 

### -- cross-examination. It 

### can be called cross, but 

### it can, ineffect, be redirect, unless there'ssome particular issue that you want toput on 

### ------ the record, thatyou have opposite issue as far 

### --- asgranting this application is concernedx-then, - I think you'dbeoathat could legally 

### - ---- be called cross, but just toencumber the record 

### - and say, 'Iwant tocross-examine thiswitness,' and then go ahead and tryto support thewitness, I 

### see where there could be a greatdeal of abuse and unfairness inthat." (Emphasis added.) The hearings examiner inthe foregoing quotation left the door atleastpartially open as toopponents crossexamining other opponents' witnesses when an "opposite issue" was involved, and he further expounded upon this later. Hisanswer toa question 

### as towhether he would permit cross-examination by an opponent of another opponent's witness if they firststated the areas inwhich they disagreed was thathewould not say that he would permit 

### it but he would listen and 

### see whether there was indeed a valid issue. It should be noted that thereafter opponents' counsel rarely requested furtherpermission to cross-examine 

### witnesses called by other opponents. In no case 

### isit apparent that counsel ever informed thehearings examiner that they



### wereopposed toa certainwitness' testimony upon any particular subject, nor did they ever request permission to cross-examine an opponent's witness on any particular subject. Instead, their objections 

### were general only, based mainly on MAPA and the Constitution. If the floodgates had been opened by thehearings examiner inallowing unlimited cross-examination, it could have resulted inan avalanche of testimony, making the present 17,000 page transcript look likea summary or condensation. Public witnesses by the dozens turned out to testify both against and infavor of the units. Under section 70-808(1)

### (c),R.C.M. 1947, now section 75-20-361(1) 

### (c)MCA, of the SitingAct, "any other interested person" is a party tothe proceeding although he waives his right under subsection (2) if he does not participate orally atthe hearing. Any of these "parties" who testified atthe hearing might 

### wellhave insisted upon their right as a party to the proceeding tocross-examine allthe witnesses, something that was not lostupon the hearings examiner asrevealed inhisvarious comments. Wefind the hearings examiner was literally forced to institute a ruling restricting the examination of witnesses, and this he did with fairness and dispatch. In spiteof the background of the hearings and the necessity torestrict examination of witnesses, the District Court held that atleast the opponent-petitioners below had the absolute right to "cross-examine" witnesses called by other opponents, Department of Health and Department of Natural Resources. Having provided the background, our attention 

### is next directed to the statutes and case law. Section 70-809(1), R.C.M. 1947, now section 75-20- 222(3) MCA, of the SitingAct provides inpart: 

# ".

. 

# . the contested case procedures of the Montana Administrative Procedure Act [82-401 to 82-42251 shall apply to the hearing, except that neither common 

### lawnor statutory rules of evidence need apply, but theboard may make rules designed toexclude repetitive, redundant or irrelevant testimony." Section 82-4210, R.C.M. 1947, now sections 2-4-612(2) and 2-4-612(5) MCA, of the MAPA provides: 

### "(1)Except asotherwise provided by statute 

### relating directly toan agency, agencies shall be bound by common law and statutory rules of evidence. 

# .

# ."(3)A party shall have the right to conduct cross-examinations required ----- for a full and true disclosureof facts, including the right to cross-examine the author of any document prepared by oron behalf of or for the use of the agency and offered inevidence." (Emphasis added.) It should be noted that section 556(d) of the Federal Administrative Procedure Act (5U.S.C.A. 8556(d) ) 

### is almost identical to the firstpart of subsection (3) above in providing that "A party 

### isentitled to

# . . . conduct such cross-examination asmay be required for a fulland true disclosure of the facts." The provision for cross-examination of the authors of agency documents offered inevidence found inthe 

### latter part of section 82-4210(3) isnot found inthe Federal Adminstrative Procedure Act nor inthe Model StateAdministrativeProcedure Act. Rather, the provision was first proposed inMontana in 1959 ina proposed Administrative Procedure Act which theMontana Legislature did not pass. (SenateBill 179.) Subsequently, the MAPA passed in 1971 preserved this language. Both proposals 

### weremade attimes when the courts

### were concerned with the unfairness that would befall claimants for rights orprivileges from governmental agencies if the claimants did not have the opportunity to challenge the factual basis of critical reports prepared for the agencies. Greene v. McElroy (1959), 360 U.S. 474, 79 S.Ct. 1400, 3 LEd 2d 1377; Cedar Rapids Steel Transp. v. Iowa StateCorn. Comm'n (Iowa 1968), 160 N.W.2d 825; Application of Plainfield-Water Co. (1953), 11 N.J. 382, 94 A.2d 673. We find that the inclusion of the foregoing provision inour statuteregarding the right to crossexamine the author of agency documents was merely a safeguard tomake certain that the existing case law 

### was recog-nized by statute. 

### Its inclusion does not broaden the scope of the remainder of the statute, and 

### it should not be construed 

### as a separate entitybut rather with the statute 

### as a whole. Although theLAPAdoes not specifically define crossexamination, resort inthis regard can bemade to section 93-1901-4, R.C.M. 1947, now section 26-1-101(1) MCA, which provides inpart: "Direct and cross-examination defined. The examination of a witness by theparty producing him 

### isdenominated the direct examination; the examination of the same witness, upon the same matter, by the adverse party, the cross-examina

### -- tion 

# . .." (Emphasis added.) It isobvious that the 

### term "adverseparty" was not included inthe statute for any other reason but tonarrow the scope of cross-examination tothe adverse party. The Montana Supreme Court, like the courts of other jurisdictions and the texts, inenunciating the general rule that cross-examination 

### is a matter of right, 

### limits such cross-examination towitnesses of the opposing party or adverse party. McGonigle v. Prudential Ins. Co. of America (1935), 100Mont. 203, 46 P.2d 687; Goldberg v. Kelly (1970), 397 U.S. 254, 90 S.Ct. 1011, 25 L Ed 2d 287; 98 C.J.S. Witnesses S368; 81Am Jur 2d, Witnesses, 8464. The right tocross-examination 

### is subject toanother limitation. The latitude of such examination 

### is largely within the discretion of the 

### trial court, withwhich the reviewing courtwillnot interfereunless there has been a manifest abuse of discretion. McGonigle v. Prudential Ins. Co. of America, supra; State

### v. Carns (1959), 136 Mont. 126, 345 P.2d 735. In this connection, section 82-4211(2), R.C.M. 1947, now section 2-4-611(2) MCA, provides thathearings examiners shall be authorized to "regulate the

course of hearings." The Federal Administrative Procedure Act is almost identical tothe Montana provision inproviding that the presiding party may "regulate the course of the hearing." 5 U.S.C.A. S556(c)(5). We find inview of the statutes and case law that there 

### isreally no distinctionbetween a court trial and a contested administrative proceeding insofar as the rules applicable to cross-examination and the discretion of the court

or hearings examiner are concerned. Should there be one rule for civil cases and another rule for administrative proceedings? We think not. Itwould be difficult tofind 

### a casemore inpoint than National Nutritional Foods Asslnv. Food & Drug Admin. (2nd Cir. 19741, 504 F.2d 761, cert. denied 420 U.S. 946. Because National Nutritional 

### is so close tothis case, more spacewillbe devoted to 

### it than ordinarily done. The case involved the review of two finalregulations of the United StatesFood & Drug Administration (FDA). During the presentation of the FDA'scase, allparties were permitted liberal cross-examination pursuant to the hearings examiner's pretrial order which provided for cross-examination by any participant desiring to do so. The Court of Appeals, Judge Friendly writing for the court, wryly noted that so liberal

a rule not unexpectedly had 

### its cost. After the opposition tothe FDA began to offer its evidence, almost 18months after the hearing commenced, the hearings examiner decided to 

### limitthe rights of participants tocross-examine the witnesses called by other participants. In an order the hearings examiner divided the 2arties into

two categories--just aswas done in this case--with the FDA

### on one side and allother participants on the other. If any participant wished tocross-examine the witness of another participant, he was to serve a notice of intention to do so. The notice had to statethat the written direct testimony of the witness was adverse to the interest of the participant, make specific reference totheportion of the testimony considered tobe adverse, and statethe reasons therefor. The hearings examiner would then determine whether togrant permission tocross-examine inhis discretion. The decision of the Court of Appeals approved the limitation on cross-examination of coparticipants' witnesses where no adversity existed between them; however, the court did find that inthe case of one particularly important witness called by theAmerican Medical Association (Dr. 

### Sebrell), the hearings examiner had incorrectly determined that no adversity existed between the

### AMA and the National Health Federation. Accordingly, the court remanded the case to the FDA for the limited purpose of permitting reasonable cross-examination of Dr. 

### Sebrellby the NHF or counsel of

some other similarly interested participant. It 

### appears that the hearings examiner had made his ruling that Dr. 

### Sebrell could not be cross-examined by the NHF even though 

### itwas explained tohim atthe time that the interests of theNHF and 

### AMA were opposite rather than identical. In commenting upon this adversity, the court noted specifically that the two organizations clearly did not have "common interests" and that theNHF was substantially asadverse to the AMA 

### as it 

### was to the FDA. 

### Judge Friendly predicated the ruling upon subsection (d) of 5556 

### of theFederal ~dministrative Procedure Act which provides, almost identically to section 82-4210(3) I

### R.C.M. 1947, now section 2-4-612(5) MCA, that a party is 

### entitled toconduct such cross-examination asmay be required fora fulland true disclosureof the facts. The court pointed out that the foregoing provision does not confer a right of so-called "unlimited" cross-examination and that presiding officerswill

### have tomake the necessary initial determination where the cross-examination is

### pressed to unreasonable lengths. The court further recognized that a hearings examiner must be allowed, indeed encouraged, totake steps toavoid repetitious or aimless cross-examination, particularly ina proceeding which has become sogargantuan as the one before it. Of more than passing interest is 

### the court's terse comment on the point which most trial lawyers have learned through sad experience--that earlydreams of confounding experts by cross-examination usually are 

### dreams indeed. The courtwonders how much more therewould have been for the agency tolearn but that Dr. 

### Sebrell was no ordinary witness and infactplayed a key part inthe preparation of the regulation. One of themost cogent statements by Judge Friendly in National Nutritional is 

### the following: 

# ".

. . In the absence of a showing of prejudice, participants with common interests should be grouped by thehearing examiner, and participants ina group should not be permitted to cross-examine witnesses calledby other members of 

### the group." 504 F.2d at 795. 

### We can identify the situation involving Dr. 

### Sebrell, the key witness involved inNational Nutritional, with the situation inthis case where Northern Plains Resource Council

### was opposed tothe Department of Health on water issues.

### In that case thematter was remanded for cross-examination of Dr. 

### Sebrell; inthis caseNorthern Plains Resource Councilwas allowed tocross-examine the Department of Health witnesses because of the adversity of interest. It 

### is 

### true that inthis case the procedure was not as structured asinNational Nutritional. On the other hand,

on atleast two occasions the hearings examiner here pointed out tocounsel the possibility of opening cross-examination inthe event of a valid adverse issue. He

### did infact allow cross-examination on thewater issues, where an adverse position existed. This should have been proof enough that, upon a proper showing of adversity, further cross-examinationwould be allowed. Furthermore, none of the counsel for the opposing parties, other than on water issues, ever pointed out inwhat respect his clientwas inopposition to another opponent. On the contrary allthatwas ever done

was to interpose general objections, and when given the specificopportunity toexplain the subjectswhere adversity existed, opposing counsel did not do so. The federal courts have inmany instances upheld rulings inadministrativeproceedings which denied completely crossexamination. Thus inFried v. United States (S.D. N.Y. 

### 1963), 212 F.Supp. 886, plaintiffs alleged denial of due process of 

### lawbecause the hearings examiner curtailed completely their right to cross-examine an allegedly crucial witness but the court upheld the ruling inview of the cumulative nature of the witness' testimony. And in~merican Public Gas Ass'n v. Federal Power Cornm'n. (D.C. 

## cir. 1974), 498 F.2d 718, alldataupon which the commission relied was tendered tothe petitioners for comment, criticism and for the submittal of rebutting material. ~eti-

### tioners complained that they were denied the right to 

### test through cross-examination the underlying bases for the submitted data but the court rejected the claim inholding that under theFederal Administrative Procedure Act, crossexamination 

### isnot always a right and that the petitioners had failed todemonstrate that cross-examination 

### was required for a "fulland true disclosure of the facts" under theAct. The purposes of cross-examination have been stated as follows: "The office of cross-examination 

### is to

### test the truth of statements of 

### a witness made on direct examination. Cross-examination serves asa 

### safeguard tocombat unreliable testimony, providing a means for discrediting 

### a witness' testimony, and 

### is inthe nature of an attack on his truth oraccuracy. 

# . . The object of crossexamination, therefore, is 

### toweaken or disprove the 

### case of one's adversary, and break down his testimony inchief, 

### test the recollection, veracity, accuracy, honesty, and bias orprejudice of the witness, his source of information, his motives, interest, and memory, and exhibit the improbabilities of his testimony." 98 

### C.J.S. Witnesses 5372, 

### pp. 125-26. Certainly examination by the opponents of other opponents' witnesses would hardly meet the true objectives of cross-examination including themain one, to 

### test the truth of the witness' statements. As 

### revealed by the record, with the exceptionof the water aspects of the case, the four main opposing parties were united inopposing the application. How examination of each other's witnesses could be termed "cross-examination" under the circumstances 

### isdifficulttounderstand. In fact, any such interrogation would really have amounted tonothing more than directorredirect examination because the sole aimand purpose would have been tobolster and support the testimony already produced on the directexamination.

### The District

### Court took the position that section 82- 4210(3), R.C.M. 

### 1947, now section 2-4-612(5) MCA, 

### imposes a mandatory right inallparties toconduct "cross-examination" of allwitnesses including the right to "cross-examine" the author of allagency documents. We find that toconstrue the statute so literally, without considering inthe least other statutes and case law, 

### is to ignore the entire scheme of the MAPA. The District 

### Court ordered the Board upon rehearing to provide opponents an opportunity tocross-examine agency witnesses. This would involve approximately 30 witnesses who are scattered throughout the United States and the world. The cost involved, not only inmoney but also in 

### time, would be staggering. We have a serious doubt, as a practical matter, if themain hearings 

### are any criteria (and



### webelieve they are), that theprocedure could be accomplished, if atall, in

### less than sixmonths ormore. Judge Friendly inNational Nutritional, supra, points out that the reviewing court should not remand when the outcome would clearly be only a repetition of the original decision. There must be, ashe states in the main text, "a 

### significantprobability" that the proceeding for which the

casewas remanded would cause the agency toalter 

### its original decision, or a need tocreate 

### a better record for appellate review of the findings. 504 F.2d at798. We find that no substantialrights of respondents/ cross-appellants have been prejudiced. The hearings examiner's decision or procedure was not erroneous or inany

manner a violation of constitutional or statutory provisions. We 

### do, however, wish toemphasize that this case 

### is unique inboth 

### its length and complexity. While 

### we have

### held that the hearings examiner did not 

### err on this crossexamination issue, the procedures followed in the hearings should not be used 

### as a model for future hearings before various stateboards and agencies. We suggest, absent general procedural rules for the conduct of hearings adopted by a board or agency pursuant to the provisions of the MAPA, 

### thatprior toany hearing, a stateboard or agency should issue an order setting the procedural guidelines tobe followed rather than delegating the entireresponsibility therefor to the hearings examiner. In summary 

### we hold that the District

### Court's opinion should be affirmed on Issue Nos. 5, 7, 8, 9, 

### 10, 11 and 12, 

### reversed on issues 1and 2, 

### with issues 3, 

### 4 and 6 

### being rendered moot. The opinion of the District Court 

### is affirmed and reversed to the extent 

### set forth herein. The decision of the Board of Natural Resources togrant toappellants/crossrespondents a certificate of environmental compatibility and public need 

### ishereby suspended pending compliance with this order. This cause 

### ishereby remanded to the Board of Natural Resources to cure certainprocedural defects found by the DistrictCourt and concurred inby us with the order and direction that the Board of Natural Resources do the following: (1)

### Make adequate findings of fact and conclusions of law with regard to: (a)

### whether using Rosebud coal and not McKay coal represents minimum environmental impact, and the reasons therefor, and (b)whether mine-mouth generation asopposed to loadcenter generation represents minimum environmental impact and the reasons therefor, including considerations as torelative energy efficiency and the relative impact of 

### electrical transmission versus coal haulage, asrequired by section 70-810(l) 

### (c)

## , R.C.M. 1947, now section 75-20-301 (2) (c)MCA. (2) Make adequate findings of fact and conclusions of law with regard to: (a) clearly designating a transmission line corridor; (b) why theBoard of Natural Resources prefers the chosen corridor tothe alternative corridors; and 

### (c)what stateand local legal requirements must be 

### met, and whether infact they have been 

### metasrequired by section 70-810(l)(f), R.C.M. 1947, now section 75-20-201 (2)(f)MCA. Such findings of fact and conclusions of law shall be propounded and entered by the Board of Natural Resources, served on theparties hereto, and returned tous for review and approval within 90 days from the datehereof.

Weconcur:



# . Gulbrandson, District forMr. Chief JusHon. 

### B. W. Thomas, 

### ~istrict Judge, sitting for Mr. Justice

Judge, sittingforMr. Justice 

## 1 Sheehy Mr. JusticeDaniel J. Shea concurs inpart and dissents in part and willfilean opinion later.

### Justice Daniel J. Shea dissenting:

There are many factors concerning this opinion which bother me deeply,but the speed with which it is suddenly being sent down and the last paragraph of the opinion are something that I must presently confinemy remarks to--due to a lack of time. Just today I 

### learned that the opinion

was going down--today. Only yesterday one of the members of our Court, at the expense of the State, chartered a plane to take the opinion to each of the district judgdso that their signatures could be obtained. The politics behind the urgency of putting this opinion down in this fashion are not something that any Court should be proud of. I know approximately a month to a month and a 

### or half ago the Governor andlone or more of his agents talked to

a member of this Court involved in this case, and expressed concern about the political bind in which the Governor was being placdbecause of the passage or threatened passage of the new bill on Colstrip 3 

### and 4. 

### I can only say that this Court member was not me. The obvious intent was that it would

sure be nice if this Court could somehow get the Governor off the hot seatby speeding up our decision. I am not suggesting that those involved intimated at all how our decision should go

# - It is common knowledge that the countdown has started for the Governor to either veto or sign the legislation concerning Colstrip 3 

### and 4. 

### Undoubtedly, putting our opinion down today will help considerably in helping the Governor reach the "right" political decision. To me this entire process is shocking.

### Now for a fewbrief comments on the finalparagraph of the majority opinion--for which there is no foundation in law. The paragraph states: "Such findings of fact and conclusions of law shall be propounded and entered by the Board of Natural Resources, served on the parties hereto, and returned to us for review and approval within 90 

### days from the date hereof." Where in the law,may I 

### ask, does it give this Court the power to exercise continuing jurisdiction over governmental agencies once we have remanded the case to them for further determinations? And where in the law do we have the authority, without an appropriate petition, after the governmental agency has acted, to completely bypass the Administrative Procedure Act and the District Court, in the event one or more of the aggrieved parties would have chosen to file a petition for review in the District Court? There is nothing in the Administrative Procedure Act which authorizes this Court to tell any agency how soon it may act after a remand from this Court. There is nothing that I 

### know of in any of the remaining statutes or case law of this State to justify such a result. Once this Court has acted on an appeal and remanded a case, either to a District Court, or to an administrative agency,we lose jurisdiction. We cannot sit here like a king with strings still attached to the parties and directing them like puppets to comply with

our orders. Here we have told the agency to act and get the results back to us within ninety days. This is judicial usurpation at its worst.

### Mr. Justice Daniel J. 

### Shea dissenting:

There are many factors concerning this opinion which bother me deeply, but because of the speed with which it was sent down, 

### I have not had time to formulate a dissent. For this reason I

### must confinemy comments at this point to the final paragraph of themajority opinion--for which there is

no foundation in law. The paragraph states: "Such findings of fact and conclusions of law shall be propounded and entered by the Board of Natural Resources, served on the parties hereto, and returned to us for review and approval within 90 

### days from the date hereof." Where in the law,may I 

### ask, does it give this Court the power to exercise continuing jurisdiction over governmental agencies

once we have remanded the case to them for further determinations? And where in the law do we have the authority without an appropriate petition, after the governmental agency has acted, to completely bypass the Administrative Procedure Act and the District Court, in the event one or more of the aggrieved parties would have chosen to file a petition for review in the District Court? There is nothing in the Administrative Procedure Act which authorizes this Court to tell any agency how soon itmay act after a remand from this Court. There is nothing that I 

### know of in any of the remaining statutes or case law of this State to justify such a result. Once this Court has acted on an appeal and remanded a case, either to a District Court, or to an administrative agency,we lose jurisdiction. We cannot sit here like a king with strings still attached to the parties and directing them like puppets to comply with our orders. Here we have told the agency to act and get the results back to us within ninety days. This is judicial usurpation at its worst.

#'