No. 13807 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1978 

JACK C. HOLLOWAY, 

Plaintiff and Appellant, 

-vsUNIVERSITY OF MONTANA, 

Defendant and Respondent. 

Appeal from: District Court of the Fourth Judicial District, 

Honorable Edward Dussault, Judge presiding. 

Counsel of Record: 

For Appellant: 

Milodragovich, Dale & Dye, Missoula, Montana 

Harold Dye argued, Missoula, Montana 

For Respondent : 

George L. Mitchell argued, Missoula, Montana 

Submitted: June 9, 1978 
Mr. Justice John C. Sheehy delivered the Opinion of the 

Court . 

Appeal from a judgment against appellant Jack C. 

Holloway in the Fourth Judicial District Court, Missoula 

County. 

Holloway sought a declaratory judgment that he was 

entitled to a Masters of Business Administration degree from 

the University of Montana. He alleged his candidacy for the 

degree and that the University refused it for the sole 

reason he had failed to obtain a grade of "C" or better in a 

course entitled, "BA650, Quantitative Methods". A nonjury 

trial was held in District Court December 6, 1976. The sole 

issue was whether Holloway's graduate student advisor had 

orally waived the Business School requirement that he obtain 

a "C" or better grade in Quantitative Methods described as a 

"core course." The District Court denied Holloway's request 

for a declaratory judgment, adopting in full the University's 

proposed findings of fact and conclusions of law and rejecting 

Holloway's motion for additional findings. 

During the academic years 1966-67 and 1967-68, Holloway's 

graduate student advisor was Dr. Jack Kempner, a professor 

in the School of Business. Holloway received a grade of "Dl' 

in Quantitative Methods. He thereupon approached Dr. Kempner 

concerning his situation. The grade adversely affected 

Holloway's academic record in two ways. It dropped his grade 

point average below the required 3.0 (on a 4.0 scale) and the 

grade did not meet the requirement that a candidate for a 

graduate degree must receive a "C" or better for the course 

to count toward his master's degree. 

Holloway testified that Dr. Kempner had told him Kempner 

was of the opinion that all that was required was a 3.0 average. 

Appellant subsequently took four other courses at the 

University and succeeded in raising his average to the required 

3.0. He did not repeat the Quantitative Methods course. Upon 
completion of a professional paper appellant made application 

for his degree in 1973. He was informed by the Dean of the 

Business School that his "D" grade in Quantitative Methods 

could not be counted toward the degree and the course would 

have to be retaken. Further, he could take an equivalent 

course in the San Francisco area where he was then residing, 

which course the University would recognize. 

Dr. Kempner, who testified at the trial, recognized 

Holloway but had no recollection of ever having told Holloway 

he would not have to retake the course in Quantitative 

Methods. However, Kempner further testified he had never 

waived any "six hundred core course for any MBA student", 

and in his recollection no student had ever received a 

waiver of the Quantitative Methods course. 

Considerable testimony was heard concerning the University's policy on granting a waiver of a required course 

and the "unwritten" nature of that policy. 

The issues presented on appeal are two-fold: 

1. Is Holloway's testimony about the waiver granted to 

him uncontroverted as a matter of law? 

2. Was the District Court's finding of fact, simply stating 

Dr. Kempner had not granted a waiver to Holloway, sufficient 

as an ultimate fact? 

Holloway contends the evidence was insufficient to 

support the judgment because he positively and unequivocally 

testified that an oral waiver had been granted him by Dr. 

Kempner and because Dr. Kempner's testimony that he did not 

recall any conversations failed to directly contradict 

Holloway's testimony. General rules are given in support 

of this contention: 

"The rule that the trial judge may not disregard 

uncontroverted credible evidence is fundamental." 

In Re Minder's Estate (19541, 128 Mont. 1, 270 

P.2d 404; Higby v. Hooper (1950), 124 Mont. 331, 

221 P.2d 1043; State ex rel. Nagle v. Naughton 
(1936), 103 Mont. 306, 63 P.2d 123; Haddox v. 

Northern Pacific R. Co. (1911), 43 Mont. 8, 

113 P. 1119." 

'I* * * the testimony of a witness that he 

does not remember whether a certain event 

or conversation took place does not 

contradict positive testimony that such 

event or conversation did take place. (citing 

cases) " . Bender v. Roundup Mining Co. (1960) , 138 Mont. 306, 356 P.2d 469. 

Holloway correctly states the general rule, but falls 

short of sustaining his contention for two reasons. First, 

considerably more goes into a trial judge's examination of 

the evidence than Holloway contends. Second, a trial judge 

is not bound to find in favor of a party simply because one 

of his witness' testimony is not directly controverted. The 

evidence in its entirety forms the basis of the Court's 

decision. 

In O'Sullivan v. Simpson, et al. (1949), 123 Mont. 314, 

212 P.2d 435, this Court, citing considerable authority, 

examined the many qua-lifications and extensions to the 

general rule that a trial court cannot disregard uncontroverted 

credible evidence. To summarize: statements may be so 

inherently improbable the Court is induced to disregard 

them. Testimony may be contradicted by other facts. There 

may be so many omissions in the testimony that the witness1 

whole story is discredited. The witness' manner of testifying, 

his appearance and demeanor may be considered. Attendant 

circumstances may cast suspicion upon the narration of a 

particular event. Finally, the interest of any witness in 

the result of the trial or any bias he might have may properly 

be considered. 

We find the record supports the trial court's decision 

on this point. For example, the University's requirements for 

a Masters of Business Administration degree were spelled out in 

its catalog. Dr. Kempner testified as to the Business School's 
standard procedure for handling requests for waivers, and 

that he did not forget to use it. Dr. Kempner also testified 

that "six hundred level" graduate courses, specifically 

Quantitative Methods, were never waived, and that he had 

never personally waived a core course. When coupled with 

the intangible factors a trial judge considers in making a 

decision, the considerable record established in this case 

would make it unreasonable to conclude the judgment was 

unsupported by the evidence. 

Holloway specifies error in that the District Court's 

single finding of fact on the contested issue was insufficient 

to support the judgment, and additional findings, as requested 

by appellant, should have been made. The applicable finding 

of fact states: 

"Dr. Jack Kempner, Plaintiff's graduate student 

advisor, did not grant Plaintiff a waiver of 

the required core course of Business Administration 650, Quantitative Methods." 

It is contended that specific findings on appellant's 

credibility and the nature and extent of the authority 

possessed by Dr. Kempner should have been made. As to the 

latter, the University admitted in its answer to appellant's 

Interrogatory No. 10 that Dr. Kempner had at least apparent 

authority to grant the waiver. Therefore, this was not a 

material issue requiring a specific finding. 

Rule 52(a), M.R.Civ.P., provides that, 

"in all actions tried upon the facts without a jury or with 

an advisory jury, the Court shall find the facts specially 

and shall state separately its conclusions of law thereon." 

Since the adoption of Rule 52(a) in Montana, the sufficiency 

of findings of fact has been considered only briefly. In 

Mondakota Gas Co. v. Becker (1968), 151 Mont. 513, 445 P.2d 

745, this Court said: 
"We think it is quite evident that a 'finding 

of fact' will vary from case to case. As 

defined in 53 Am. Jur. Trials, Section 1131, 

page 786: 'Findings of fact may be defined 

as the written statement of the ultimate 

facts as found by the court, signed by the 

court and filed therein, and essential to 

support the decision and judgment rendered 

thereon.'" 

Despite the infrequency with which this Court has dealt 

with the sufficiency of findings of fact, neighboring 

jurisdictions (that have adopted rules identical to Rule 

52(a)) have dealt with the issue on numerous occasions. 

"The trial court's function in nonjury cases 

is to find ultimate facts from conflicting 

evidence; and if these findings are sustained 

by competent, substantial, although conflicting 

evidence, such will not be disturbed on appeal." 

Hafer v. Horn (1973), 95 Idaho 621, 515 P.2d 

1013. 

"With these principles in mind we turn to the 

finding in question and note, first, the 

classic rule-~ that findings must state ultimate 

facts; they should not relate evidentiary facts 

relied upon by the court to reach the ultimate 

facts." Seeley v. Combs (1966), 52 Gal-Rptr. 

578, 65 C.2d 127, 416 P.2d 810. 

"In regard to the matter of the sufficiency 

of findings of fact, a substantial compliance 

with Rule 52, Utah Rules of Civ.P., is 

sufficient and findings of fact and conclusions 

of law will support a judgment though they are 

very general, where they in most respects 

follow the allegation of the pleadings. Findings 

should be limited to the ultimate facts and if 

they ascertain ultimate facts and sufficiently 

conform to the pleadings and the evidence to 

support the judgment, they will be regarded as 

sufficient, though not as complete as might 

be desired." Pearson v. Pearson (Utah 1977), 

561 P.2d 1080. 

In the words of counsel for the appellant, "the case 

proceeded to trial on the basis of the single ultimate issue 
of whether a waiver was given by Dr. Kempner in the manner 

alleged." Holloway's credibility was not a material issue 

and no finding of fact was required concerning his credibility 

simpl:y because Holloway speculates it was considered in the 

trial judge's decision. The District Court made its finding 

of fact on the material issue alleged in the pleadings. 

The record supports that "ultimate fact". 

We have held (Mondakota Gas Co. v. Becker, supra) and 

now hold, in line with what we find other courts hold, that 

Rule 52(a) M.R.Civ.P., which obliges a trial court without a 

jury to "find the facts specially," requires findings of 

ultimate facts and not evidentiary facts. Sometimes (and this 

case is an example) a situation exists where the ultimate 

fact stated by the Court can also be read as a conclusion of 

law. Thus, here it is a statement of ultimate fact that "Dr. 

Jack Kempner * * * did not grant Plaintiff a waiver of the 

required core course * * * ", but that same statement could 

also be read as a conclusion of law. The statement does 

not thereby lose its character as a finding of ultimate fact, 

however. 

The purpose of requiring "ultimate facts" in a court's 

findings is three-fold: (a) to aid the trial court in making 

correct factual decisions and reasoned application of law to 

facts; (b) to define for purposes of res judicata and estoppel 

by judgment the issues there adjudicated; and (c) to aid 

the appellate court. Moore's Federal Practice, Vol. 5A, 

p. 2666, Section 52.03 (3) (Rel. No. 9) . An ultimate fact is 

one deduced by the Court from evidentiary facts, but evidentiary 

facts should not be part of the Court's findings, because 

evidentiary facts are incapable of becoming res judicata. 

Abeles v. Wurdack (Mo. 1955) 285 S.W.2d 544, 548. The function 

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of the trial court in determining the ultimate facts from 

the evidentiary facts is respected in Rule 52(a), and such 

ultimate fact findings "shall not be set aside unless clearly 

erroneous, and due regard shall be given to the opportunity 

of the trial court to judge of the credibility of the witnesses." 

It is because the statement here involved could be read 

both as a conclusion of law and as a finding of ultimate 

fact that this case is distinguishable from those cases 

relied on by Holloway as supporting his contention that 

this particular finding is insufficient to support the 

judgment. In this case the material fact issue is determined 

by the trial court in an expression of ultimate fact. No 

more is required under Rule 52(a). 

It is axiomatic that a District Court makes findings 

only as to material issues of fact related to the cause of 

action, Thompson v.Bantz (1959), 136 Mont. 210, 215, 346 

P.2d 982, 985, and that a Court may not make findings upon 

matter outside the material issues. See: O'Brien v. 

Drinkenberg (1910), 41 Mont. 538, 544, 111 P. 137, 139; 

Dutro v. Kennedy (1889), 9 Mont. 101, 107, 22 P. 763, 764. 

Here the credibility of Holloway was not a material issue 

related to the cause of action; rather, it was only a factor 

to be considered in weighing the evidence. It is not a 

necessary or sole implication that because the Court found 

against the direct testimony of Holloway, that automatically 

the Court found his testimony to be false. It may be as 

easily assumed that, in the light of the weight of other 

evidence against the testimony of Holloway, that Holloway 

could have been mistaken or he may have misunderstood the 

tenor or meaning of what Dr. Kempner told him. Whether 

Holloway was mistaken, or else whether his testimony was 

false, was not a material issue in the case on which the 

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Court had to make a finding. The record afforded sufficient 

evidence that no waiver had been granted without any finding 

necessary as to the truth of Holloway's testimony. 

For the reasons expressed, the judgment of the District 

Court is affirmed. 

Justice 

We Concur: 

Chief Justice