No. 13038 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

CARMIE R. DUFFY and D. COSETTE DUFFY, 

Plaintiffs and Appellants, 

BUTTE TFACHERS ' UNION, NUMBER 332, AFL-CIO ; 

MIKE McCARTHY; EDWARD HEARD; MONTANA PHYSICIANS' 

SERVICE, a corporation; GIL HOXMER; SCHOOL DISTRICT 

NUMBER ONE OF SILVER BOW COUNTY, MONTANA, a political 

subdivision of the State of Montana and body public 

and corporate; BOARD OF TRUSTEES OF SCHOOL DISTRICT 

NUMBER ONE OF SILVER BOW COUNTY, MONTANA; 

Defendants and Respondents. 

Appeal from: District Court of the Second Judicial District, 

Honorable W. W. Lessley, Judge presiding. 

Counsel of Record: 

For Appellants : 

Poore, McKenzie, Roth, Robischon and Robinson, 

Allen R. McKenzie argued, Butte, Montana 

For Respondents: 

Henningsen, Purcell & Genzberger, Butte, Montana 

Robert McCarthy argued, Butte, Montana 

Hughes, Bennett & Cain, Helena, Montana 

Alan F. Cafn argued, Helena, Montana 

John G. Winston, County Attorney, Butte, Montana 

John J. Parker, Deputy County Attorney, argued, 

Butte, Montana 

Submitted: September 22, 1975 

Decided: GrT31 I<jj!j 

Filed : 

6CF 3 1 1975 

Clerk 
Mr. Justice Gene B. Daly delivered the Opinion of the Court. 

This is an appeal from a judgment that granted all 

defendants' motions to dismiss for failure to state a claim upon 

which relief could be granted, without leave to refile. 

Plaintiffs filed their original complaint in the district 

court, Lewis and Clark County, September 23, 1974, against all 

defendants except School District Number One of Silver Bow County, 

Montana and its Board of Trustees. The complaint charges defendants 

with conspiracy to violate certain rights of plaintiffs. Consolidated motions asking for (a) a change of venue, (b) dismissal 

for failure to state a claim upon which relief can be granted, and 

(c) a more definite statement as to the conspiracy, together with 

accompanying briefs, were filed by defendants. The venue was 

changed to the Second Judicial District, Silver Bow County, 

whereupon plaintiffs disqualified both district judges of the 

Second Judicial District. Judge W. W. Lessley, Thirteenth Judicial 

District, assumed jurisdiction. 

An amended complaint was filed by plaintiffs which added 

defendants School District Number One of Silver Bow County and 

the Board of Trustees of School District Number One, Silver Bow 

County. Defendants, in turn, amended their briefs in support of 

the motion to dismiss. All motions were heard by the court. 

On April 22, 1975, the district court entered an order 

and judgment which granted the motions to dismiss for failure to 

state a claim upon which relief can be granted, to all defendants. 

This appeal is from that judgment. 

The amended complaint pleads the corporate capacity of 

Montana physicians' Service (MPS); the position of the defendant 

Butte ~eachers' Union Number 332, AFL-CIO (Union), as representing 

teachers employed by School District Number One of Silver Bow 

County (School District); and the position of Edward Heard and 
Mike McCarthy as officers of said Union. Defendant Gil Hoxmer 

is an agent of Montana Physicians' Service. Plaintiffs are not 

members of the Union. Pro form allegations are included with 

respect to School District Number One of Silver Bow County and 

its Board of Trustees. 

It alleges that for a number of years contracts existed 

between the Union and MPS providing group medical, surgical and 

hospital benefits and that pursuant to these contracts the School 

District made contributions to MPS at its Helena, Montana offices 

on behalf of all teachers. That contributions were made on behalf 

of plaintiffs, who are not members of said Union, to MPS and that 

benefits were provided to plaintiffs in accordance with the contract 

between the Union and MPS at rates identical to those established 

for all teachers. 

Further that after September 1972, the Union directed 

MPS to maintain separate charge histories for nonunion teachers 

and union teachers. That prior to September 1973, the nonunion 

teachers "were advised" that they would be separated and segregated 

from the union teachers for health insurance purposes and that they 

would have to secure their own insurance. 

Plaintiffs chose to join a group composed of school district administrators and other nonunion teachers. The health 

insurance rates for the union group was $39.99 per month and for 

the administrator nonunion group was $47.65, for identical 

coverage. The School District contributed $35 per month to both 

union and nonunion teachers. The net difference payable by the 

teachers was $12.65 for nonunion teachers and $4.99 for union 

teachers. 

I I In the amended complaint a provision of the Master 

Agreement" entered into between the School District and the Union 

for the period effective September 1, 1973, is set forth in haec 

verba. This section of the agreement provides that on or before 
April 1, the Union shall arrange for a medical, surgical and 

hospital plan for the benefit of its membership and the School 

District will make contribution of $35 per month per member teacher 

toward the cost of said plan and armge for payroll deductions. 

Plaintiffs allege that prior to July 1973 defendants 

Union, MPS and Hoxmer entered into a conspiracy to force plaintiffs 

to become members of the Union by insisting on a contract between 

the Union and - MPS providing for discriminatory and excessive rates 

to be charaged plaintiffs and other nonunion teachers. 

The agreement between the Union and MPS is alleged to be 

unlawful by reason of its violation of "Rule 36" of the Master 

Agreement for failure by the Union to write specifications and 

receive sealed bids for the medical and surgical coverage for the 

Union members; instead the Union negotiated a contract of coverage 

for its members that discriminated against plaintiffs and others 

similarly, situated. The amended complaint further alleges this 

is in violation of sections 11-1024, 75-6118, 75-6120, 64-303 and 

40-3509, R.C.M. 1947; the due process clause of the First and 

Fourteenth Amendments to the United States Constitution; and, 

Article IT, Section 7, 1972 Montana Constitution. 

It further alleges that plaintiffs are, in addition to 

not being members of the Union, taxpayers of Silver Bow County; 

that the agreement between the School District and the Union, which 

calls for a contribution on behalf of all teachers in the amount of 

$35 per month, is illegal in violation of section 11-1024, and asks 

that these contributions be repaid to Silver Bow County (not a party 

to this action) by the Union and MPS to the extent they exceed 

$120 per year per teacher. In the prayer, plaintiffs ask that only 

MPS be required to repay such amounts. 

The law on conspiracy is relatively well settled in Montana. 

In 15A C.J.S., Conspiracy, $5 l(1) and 1(2), it is said: 
11 9 l(1). A civil conspiracy is a combination of 

two or more persons by concerted action to accomplish 

an unlawful purpose, or to accomplish some purpose 

not in itself unlawful by unlawful means. II 

5 l(2). "The essential elements required to establish 

a civil conspiracy are the same as those required to 

establish a criminal conspiracy. In general, to constitute a civil conspiracy there must be: (1) Two or 

more persons, and for this purpose a corporation is a 

person; (2) an object to be accomplished; (3) a meeting 

of minds on the object or course of action; (4) one or more 

unlawful overt acts; and (5) damages as the proximate 

result thereof. +r *I1 

In 15A C.J.S., Conspiracy, 2, it is further noted that 

if the object of an alleged "conspiracy" is lawful, and the means 

used to attain that object are lawful, there can be no civil action 

for conspiracy. The foregoing is true even though damage may 

result to the plaintiffs and even though defendants may have acted 

with a malicious motive. If such were not the rule, obviously 

many purely business dealings would give rise to an action in 

tort on behalf of one who may have been adversely affected. 

Prosser, Law of Torts, 4th Ed., p. 293, notes that it 

is not really the conspiracy which gives rise to a right of action, 

but the torts which may be committed in furtherance thereof. 

Each of these actions would support a claim for relief itself--- 

the only function served by the action of conspiracy being to 

connect nonacting but participating members who would not ~therw~se 

be liable to the one damaged. 

11 1 <. ;'c f; The gist of the action is not the 

conspiracy charged, but the tort working damage 1 to the plaintiff. It is only where means are 

employed, or purposes are accomplished, which are 

themselves tortious, that the conspirators who 

have not acted but have promoted the act will be 

held liable. " 

'ro sustain their action here, then, plaintiffs must allege a tort 

committed by one of the alleged conspirators. 

The decisions of this Court are in accord with the foregoing. In Mustang Beverage Co., Inc. v. Jos. ~chlitz rew wing Co., 

162 Mont. 243, 251, 511 P.2d 1, the Court held: 
"'* * * a combination of individuals for their 

joint benefit does not constitute a conspiracy * * * the actionable element of conspiracy is the 

wrong done to the plaintiffs, not the combination 

of persons constituting the conspiracy. 1 It 

In an early case this Court noted that freedom of contract 

is the general rule and that persons may grant orwithEio,ld, their 

business or patronage from others without incurring liability 

therefor. In Empire Theatre Co. v. Cloke, 53 Mont. 183, 193, 163 P. 

107, the Court holding a combination to do a lawful thing by 

lawful means is no conspiracy, said: 

I I Every person has the right, singly and in combination 

with others, to deal or refuse to deal with whom he 

chooses; to reach his decision in that, as in all other 

matters, upon or without good reason; to regard as unfriendly all those who, with or without justification, 

refuse to co-operate or sympathize. I I 

In Empire Theatre the Court approved the use of a boycott by 

members of a union against an employer. 

The general rule set out in C.J.S. was approved in 

Biering v. Ringling, 74 Mont. 176, 196, 240 P. 829, where the unlawful act was found to be a plan to defraud the plaintiff: 

11 1 A conspiracy is a combination of two or more 

persons by some concerted action to accomplish a 

criminal or unlawful purpose or to accomplish a 

purpose, not in itself criminal or unlawful, by 

criminal or unlawful means. I It 

See also: Mining Securities Co. v. Wall, 99 Mont. 596, 45 P.2d 

302; Lindsay & Co. v. Mont. Federation of Labor, 37 Mont. 264, 

A motion to dismiss for failure to state a claim upon 

which relief can be granted, Rule 12(b)(6), M.R.Civ.P., is 

equivalent to a demurrer under former civil procedure. Payne v. 

Mountain States Tel. & Tel. Co., 142 Mont. 406, 409, 385 P.2d 100. 

A motion to dismiss admits to all facts well pleaded and in 

considering the motion the material allegations of the pleading 

attacked are taken as true. Deich v. Deich, 136 Mont. 566, 585, 

323 P.2d 35. Where a complaint states facts sufficient to constitute a cause of action upon any theory, then the motion to dismiss 
must be overruled. Nlgelo v. Koundup Coal Mining Co., 109 Nont. 

293, 300, 96 P.2d 932. However, when a complaint alleges facts 

and,assuming the facts are true,there still is no claim for relief 

stated under any theory, a motion to dismiss must be granted. 

Reducing the well pleaded facts to their essence and 

discarding the legal conclusions, the amended complaint seeks relief 

because after September 1973, plaintiffs as nonunion teachers 

were not permitted by the Union to remain as members of the group 

for which the Union contracted for health benefits for its members 

from MPS. The School District or Board of Trustees are not included 

in the alleged conspiracy. The illegal act inserted by plaintiffs 

to justify a tort to result in a conspiracy was failure of the 

Union, under its contract with the Board of Trustees for the 

benefit of the Union members, to draw specifications and receive 

bids for their health coverage. A procedural variation from their 

own contract would not be unlawful even if considered a breach by 

a party to the contract who would have standing to complain. 

Plaintiffs admit they are not Union members and have no standing in 

relation to a contract entered into by the Union for the benefit 

of its members. The Union did precisely what it had contracted 

to do. There is no legal reason why the Union was required to 

permit plaintiffs to be members of its group. 

As to the role of MPS in the transaction alleged in the 

complaint, it was merely a seller of services. MPS was not a party 

to the contract between the Union and the School District of which 

plaintiffs complain, it merely sold certain benefits to the Union 

per its order and other benefits to other groups of School District 

employees. Since freedom of contract is the general rule there is 

no reason why MPS cannot contract for the furnishing of services 

with whatever groups it chooses and charge whatever rates it feels 

are justified to those groups with which it contracts. Great 

Northern U. Co. v. Public Ser. Com., 88 Mont. 180, 228, 229, 293 

P. 294, reads in part: 
2° he general right to make a contract in relation 

to his business is part of the liberty of the 

individual protected by the 14th Amendment of the 

federal constitution' (Lechner v. New York, 198 

U.S. 45, 49 L.Ed.937, 25 Sup.Ct.Rep.539), and that 

'the right of the owner to fix a price at which 

his property shall be sold or used is an inherent 

attribute of the property itself' (State Freight 

Tax Case, 15 Wall. (U.S.) 232, 278, 21 L.Ed. 146, 163) Jc Jr dc." 

See also: Hein v. Fox, 126 Mont. 514, 254 P.2d 1076 

(1953). 

As noted heretofore, when parties merely do what they 

have a legal right to do, and when the means used are not unlawful-- 

an allegation in a complaint that the action amounts to a 

~f ~onspiracy" gives no right of action to anyone, even if the 

parties agreed among themselves to take such action. 

Plaintiffs next use the violation of section 11-1024, 

R.C.M. 1947, as an unlawful act to supply the tort for the conspiracy, That section directs departments, agencies, etc. of 

the state of Montana, and all counties, cities and towns to 

contract for group health insurance when requested to do so by 

two-thirds of their employees and to make limited ($10.00) contributions to the cost of such coverage. 

At the time School District Number One contributed $35 

to the cost of all teachers' group health insurance there were two 

opinions of the attorney general of Montana holding that neither 

the grant of power to enter into and contribute to the cost of 

group hospital and medical insurance for the benefit of employees, 

nor the limitation on the amount of such contribution contained 

in section 11-1024, were applicable to school districts but the 

school districts had the authority and power to expend school 

funds for group insurance for teachers and employees as part of the 

salaries and compensation of the teachers and employees. 27 Opinions 

of the Attorney General No. 49; 30 Opinions of the Attorney General 

No. 6. 
While opinions of the attorney general are not binding 

upon this Court, the Board of Trustees of School District Number 

3ne and the Union were entitled to rely on and act in accordance 

with those opinions when they negotiated the 1973-1974 Master 

Agreement. 

On February 4, 1974, months after the Master Agreement was 

executed, the attorney general issued another opinion in which he 

held the previously mentioned two attorney general opinions 

"were no longer applicable" in view of this court's decision in 

Teamsters v. Cascade Co. Sch.Dist. No. 1, 162 Mont. 277, 511 P.2d 

339. 35 Opinions of the Attorney General No. 69. The effect 

of that attorney general opinion was short lived. The Montana 

Legislature amended section 11-1024, effective March 12, 1974, 

Montana Session Laws 1974, Chap. 188, by adding this sentence: 

11 Provided, however, that for employees of 

elementary and high school districts premium 

contributions are not subject to the ten dollar 

($10) limitation of this section. " 

We hold the $35 contribution was not unlawful. If it were 

unlawful it would not help to establish a conspiracy under the 

facts here as the party that would have violated the section by 

agreeing to make, and did make to all parties, a payment not 

authorized by law was the School District. 

The violation of other statutes pleaded by plaintiffs have 

to do with teachers' rights, union practices, unfair practices and 

the like, which have little relevancy to the issue here, lacking a 

conspiracy. 

The argument in brief as it pertains to discrimination 

in regard to conditions of employment by failure to belong to the 

Union, contrary to Benson v. School Dist. No. 1 of Silver Bow County, 

136 Mont. 77, 344 P.2d 177 (1959), is without merit here. Benson 

was against the school district for contracting with the Union for 
a "security clause" in the master contract which required teachers 

to join or lose salary benefits. 

The judgment of the district court is affirmed. 

i' 

We Concur: / 

d' Justices.