No. 05-442

IN THE SUPREME COURT OF THE STATE OF MONTANA

2006 MT 171

_______________________________________ SANDRA CROMWELL, Plaintiff and Appellant,

v. VICTOR SCHOOL DISTRICT NUMBER 7, Defendant, Respondent and Cross-Appellant.

______________________________________ APPEAL FROM: District Court of the Twenty-First Judicial District, In and for the County of Ravalli, Cause No. DV 04-111 The Honorable Jeffrey H. Langton, Judge presiding.

COUNSEL OF RECORD: For Appellant: Richard R. Buley, Tipp & Buley, Missoula, Montana For Respondent: Robert Stutz and Debra A. Silk, Montana School Boards Association, Helena, Montana

____________________________________ Submitted on Briefs: March 29, 2006 Decided: July 25, 2006

Filed:

______________________________________ ClerkJustice Brian Morris delivered the Opinion of the Court. ¶1 Sandra Cromwell (Cromwell) appeals from a decision of the Twenty-First Judicial District, Ravalli County, awarding no damages after finding th at she had been wrongfully discharged from employment by Victor School District Number 7 (School District). The School District cross-appeals the District Court’s determination that it wrongfully discharged Cromwell. We affirm in part , reverse in part, and remand for further proceedings. ¶2 We review the followi ng issues on appeal: ¶3 Whether the District Court properly de termined that the School District wrongfully discharged Cromwell. ¶4 Whether the District Court proper ly awarded Cromwell no damages.

FACTUAL AND PROCED URAL BACKGROUND ¶5 The School District hired Cromwell as an administrative assistant in September of 1998. The School District categorized Crom well as a “classified employee” upon hiring and provided Cromwell with a classified em ployee handbook. The classified employee handbook stated that all “employe es must satisfactorily comple te a probationary period of

six months after which the employee will attain perman ent status.” Cromwell’s probationary period of employm ent ended in March of 1999. ¶6 The School District promoted Cromwe ll to the position of business manager effective July 1, 1999, but sh e remained a classified employe e. Cromwell and the School District signed a document entitled “Busin ess Manager 1999-2000 ” on September 16,

1999. The document stat ed that “the District has and does hereby employ the Business

2Manager on a full-time year-round basis, co mmencing on July 1, 1999.” The document explained certain terms of Cromwell’s employm ent such as salary, fringe benefits, and sick leave. The document did not explic itly state an end date for her term of employment. Cromwell signed similar docum ents each of the next three years. ¶7 The School District adopted a new classified employee policy on October 9, 2001. The new policy stated that each “classified employee hired on or after October 9, 2001 shall be employed under annual contracts of a specified term within the meaning of [S]ection 39-2-912, MCA.” Section 39-2- 912(2), MCA, exempts an employment agreement covered by a written c ontract for a specified term from the requirements of the Wrongful Discharge From Employment Act (W DEA), §§ 39-2-901 to 915, MCA. An employee covered by the WDEA may not be di scharged after completing a probationary period except for good cause. See § 39-2-904(1)(b), MCA. ¶8 The School District notified Cromwell on June 12, 2003, that the school board

voted not to renew her contract and termin ated Cromwell from employment. The School District granted Cromwell a severance packag e that matched her sa lary through August 31, 2003. Cromwell earned an annual salary of $33,280 at the time of her termination. ¶9 Cromwell filed an action for wr ongful termination on Marc h 4, 2004. The District Court held a bench trial on April 4, 2005. Cr omwell provided the only testimony at trial.

Cromwell testified that she worked for the School District as a permanent employee according to the terms of the classified empl oyee handbook. Cromwe ll testified that she did not believe the business manager docu ments represented annual contracts for specified terms, but merely represented agreements concerning her salary.

3¶10 The fifty-two year old Cromwell testif ied that she had difficulty finding new employment after being discharged by the Sc hool District. Cromwell attempted to find work by signing up with Montana Job Servi ces, took various tests that evaluated her computer and typing proficienc y, and sent out numerous resu mes to positions advertised in local papers. She testifie d that these postings were for bookkeepers in the private

sector and as land title examiners in Ravalli County. Cromwell did not keep records of her job search. The School District’s counsel pressed Cromwell on cross-examination why she had not applied for a number of positions that had been recently posted in the paper, such as a position as a financial anal yst, and questioned why she failed to visit certain websites while searching for employmen t. Cromwell responded that she had not been monitoring the paper since finding he r new employment, that she did not possess the qualifications required for a financial anal yst, and that she relied on newspapers and the job service to find local job postings rather than the intern et. As a result, she claims that a limited number of jobs were available in her area. ¶11 Cromwell initially focused her job search in Ravalli County , but eventually

widened her search to incl ude Missoula, approximately 35 miles from her home in Victor. Cromwell eventually found a job in Missoula three weeks befo re her trial started with a construction company where her son al so works. She earns $10 an hour and she works approximately 27 hours per week. ¶12 The School District conceded at tria l that it did not terminate Cromwell’s employment for cause. The School District contende d instead that Cromwell’s employment agreement did not fa ll within the scope of the WD EA. It asserted that the

4business manager documents signed by Cromwell and the Sc hool District constituted written agreements for specified terms under § 39-2-912(2), MCA. ¶13 The District Court concluded that the Sc hool District had wrongfully discharged Cromwell as set forth in § 39-2-904(1)(b), MC A. The business manager documents that Cromwell signed after attaining permanent employee status did not represent written employment contracts for a specific term un der § 39-2-912(2), MCA. The court found that according to the term s of the employment hand book Cromwell had become a permanent employee after succe ssfully completing the six mo nth probationary period.

The School District co uld not discharge Cromwe ll without cause. ¶14 The District Court awarded Cromwell no damages, however, because it concluded

that Cromwell did not exercise reasonable d iligence in seeking ne w employment after being terminated by School District. Th e District Court reasoned that Cromwell neglected the Missoula job market, failed to keep records of her job search, and failed to use certain internet job search resources. The District Court also held that Cromwell failed to present sufficient ev idence that reasonable employ ment opportunities were not available in the Hamilton-Missoula job market . It further determined that the School District had provided a relative ly generous severance package that matched her salary for a period of 11 weeks, within which time Cromwe ll should have been able to find suitable work. This appeal followed.

5DISCUSSION ¶15 Whether the District Court improperly determined that the School District wrongfully discharged Cromwell. ¶16 The construction and interpre tation of a contract constitu tes a question of law for

the court to decide. Chase v. Bearpaw Ranch Ass’n , 2006 MT 67, ¶ 14, 331 Mont. 421, ¶ 14, 133 P.3d 190, ¶ 14. We review a distri ct court’s conclusions of law to determine whether the court’s interpretation of the law is correct. Chase , ¶ 14. We review any findings of fact made by a district court to support its legal conclusions to determine if they are clearly erroneous. See Watson v. Dundas , 2006 MT 104, ¶ 17, 332 Mont. 164, ¶ 17, ___P.3d___, ¶ 17. ¶17 The School District asserts that it could terminate Cromwell’s employment without cause because Cromwell’s employment agreement fell within the exemption to the WDEA provided by § 39-2-912(2), MCA. The School District maintains that the business manager documents signed by Crom well constituted wr itten contracts of employment for a specific term under § 39-2-912(2), MCA. ¶18 Cromwell responds that she worked for the School District as a permanent employee according to the te rms of the classified employee handbook. Cromwell contends that the business manager documents represented mere agreements concerning her yearly salary. She points out that the business manager documents do not explicitly state an ending date for her term of employment. ¶19 We agree with Cromwell that § 39-2-912(2 ), MCA, does not apply. The School District’s position contradict s the plain language of its own classified employee

6handbook. The classified employee handbook that the School District provided to Cromwell upon hiring states that after a six month probationary period “the employee will attain permanent status.” According to the terms of the School District’s own handbook, Cromwell had attained status as a permanent employee long before she signed the first business manager document on Se ptember 16, 1999. The new classified employment handbook does not explicitly addr ess the status of employees such as

Cromwell. The handbook does implicitly support the position that Cromwell worked as a permanent employee, however, as it states that only employees “hired on or after October 9, 2001 shall be employed under annual cont racts of a specified term.” The School District hired Cromwell in September of 1998. ¶20 The business manager documents remain ambiguous concerning the term of employment for Cromwell. We interpret a contract agains t the party who caused the uncertainty to exist. Watson , ¶ 27. The School District dr afted the documents that do not explicitly state a specified term of employment. Cromwell testified that she understood the business manager documents as mere ag reements concerning her yearly salary. Cromwell already had attained status as a permanent em ployee and the accompanying protections of the WDEA. See § 39-2-904, MCA. We will not interpret the ambiguous provisions of the business manager docum ents to modify Cromwell’s employment agreement and deprive her of the protections of the WDEA. We conclude that the business manager documents do not represent written contracts for a specified term under § 39-2-912(2), MCA. As a result, the District Court correctly determined that the School District wrongfully discharged Cromwell.

7¶21 Whether the District Court improp erly awarded Cromwell no damages. ¶22 A court may award damages to a wrongfu lly discharged employee based on lost wages for a period not to exceed four years less any amount th at the employee could have earned with reasonable diligence. Section 39- 2-905(1), MCA. A di strict court possesses

the discretion to determine the amount of da mages recoverable under § 39-2-905, MCA.

Weber v. State (1992), 253 Mont. 148, 153, 831 P.2d 1359, 136 2. We review a district court’s discretionary rulings fo r an abuse of discretion. Jarvenpaa v. Glacier Elec. Coop. Inc ., 1998 MT 306, ¶ 12, 2 92 Mont. 118, ¶ 12, 970 P.2d 84, ¶ 12. ¶23 The District Court made no finding of fact regarding Cromwell’s diligence in finding new employment. The District Cour t instead based its award of no damages on its legal conclusion that Cr omwell had “failed to presen t sufficient evidence that reasonable employment opportunities were not available to her in the Hamilton-Missoula job markets.” We review lega l conclusions for correctness. In re Conservatorship of

Kloss , 2005 MT 39, ¶ 7, 326 Mont. 117, ¶ 7, 109 P.3d 205, ¶ 7. ¶24 Cromwell argues that the court improperly concluded that she failed to produce

sufficient evidence that r easonable employment opportun ities were not available in Ravalli County when she presente d the only evidence regarding the availability of other jobs through her testimony at trial. Crom well testified that she sought employment through the job service in Ra valli County, she signed up with a temporary employment agency, and she applied to numerous openi ngs listed in the local paper. Cromwell’s testimony represents the only evidence concer ning the availability of job opportunities during her period of unemployment.

8¶25 Once the District Court determined that Cromwell had been wrongfully discharged, the burden shifted to the School District to plead Cromwell’s lack of reasonable diligence in findi ng new employment as an affirmative defense. Martinell v.

Montana Power Co. (1994), 268 Mont. 292, 322-23, 886 P.2d 421, 440. As an affirmative defense, the School District, rath er than Cromwell, had the burden of proving Cromwell’s failure to mitigate. Martinell , 268 Mont. at 322-23, 886 P.2d at 440; E.C.A. Environ. Managem ent v. Toenyes (1984), 208 Mont. 336, 350, 679 P.2d 213, 220 . In this case, however, the District Court appears to ha ve reversed the burden as evidenced by its

conclusion of law that Cromwell “failed to present sufficient evidence that reasonable employment opportunities were not availabl e to her in the Hamilton-Missoula job

markets.” ¶26 The School District presente d no witnesses to support its contention that Cromwell

had failed to exercise reasona ble diligence in failing to fi nd replacement employment.

The School District elected instead to attempt to impeach Cromwell on crossexamination through limited evidence of job oppor tunities listed in local newspapers that existed at the time of trial. These listings re presented jobs available at the time of trial when Cromwell already had fo und a new job and ha d stopped looking for employment. The School District presented no evidence that these comparable jobs were available during the period when Cromwell actually was looking for work. ¶27 Cromwell further contends that the District Court improperly relied on the fact that she focused her job search primarily in Ravalli County an d did not seek employment more diligently in Missoula, approximately 35 miles from her home in Victor.

9Cromwell’s initial failure to explore the Miss oula job market should not have foreclosed completely an award of dama ges. Even if Cromwell imme diately had found comparable employment in Missoula, she still would be required to drive 70 miles round trip as a result of being wrongfully discharged from he r job with the School District in Ravalli County. The law does not require a wrongfully terminated employee to move to another locality to find employment. Martinell, 268 Mont. at 321, 886 P.2d at 439. The costs

and time associated with a da ily commute to a different lo cality could support an award of damages. ¶28 Cromwell did concede on cross-examination that she had failed to take advantage of certain internet resources in her job search . It is unclear once again, however, whether these internet resources contained job opport unities that were listed at the time that Cromwell should have been looking for a job. It further is uncl ear whether Cromwell failed to pursue any of the job prospects cont ained in those internet resources that may

have been available at the time that Cromwell should have been looking for a job. Although Cromwell admittedly neglected to use these internet resources, this omission would serve to reduce any award of damages. This omission should not serve to preclude entirely an award of damages in light of the uncertainty regarding what job opportunities might have been available through these internet resources and at what time. ¶29 Cromwell now works an average of 27 hour s a week in Missoula for $10 an hour, a significant reduction from her full-time job with the School Di strict that paid her an annual salary of $33,280. The fact that Cromwell now wo rks fewer hours for lower pay

and must travel 35 miles from home in order to work would support an award of damages

10in the absence of evid ence that she failed to exercise r easonable diligence in seeking new employment. The District Court made no finding that Cromwell failed to exercise reasonable diligence. We agree with Cr omwell that the District Court erred by concluding as a matter of law that she failed to exercise re asonable diligence based on the

evidence at trial. The Distri ct Court correspondingly abused its discretion in awarding no damages. ¶30 We affirm in part, reverse in part, and re mand this matter to the District Court for the limited purpose of having the court make findings of fact and enter conclusions of law regarding the appropriate amount of dama ges based on the record presented at the previous trial.

/S/ BRIAN MORRIS

We Concur:

/S/ KARLA M. GRAY /S/ PATRICIA COTTER /S/ JAMES C. NELSON /S/ W. WILLIAM LEAPHART /S/ JOHN WARNER /S/ JIM RICE

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