No. 86-302 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1987 

FRAZER SCHOOL DISTRICT NO. 2, 

Appellant and Respondent, 

-vsBETH M. FLYNN; SUPERINTENDENT OF 

PUBLIC INSTRUCTION; ALFREDA DRARBS, 

VALLEY COUNTY SUPERINTENDENT OF SCHOOLS; 

AND DELORES HUGHES, SUBSTITUTE HEARING 

OFFICER, 

Respondents and Appellants. 

APPEAL FROM: District Court of the Seventeenth Judicial District, 

In and for the County of Valley, 

The Honorable Leroy McKinnon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellants: 

John W. Larson, Office of Public Instruction, Helena, 

Montana 

G. T. Archarnbeault, for Beth Flynn, Glasgow, Montana 

For Respondent : 

James D. Rector, Glasgow, Montana 

For Amicus Curiae: 

Bruce W. Moerer, Montana School Boards Assoc., Helena, 

Montana 

Filed: 

Submitted on Briefs: Jan. 7, 1987 

Decided: February 5, 1987 
Mr. Justice L. C. Gulbrandson delivered the Opinion of the 

Court. 

This is an appeal from an order of the District Court 

of the Seventeenth Judicial District, in and for Valley 

County, Montana. The order reversed a decision of the State 

Superintendent of Public Instruction which allowed a tuition 

transfer for appellant. We affirm the order of the District 

Court denying the tuition transfer. 

Beth M. Flynn (appellant) a resident of the Frazer 

School District, removed her child from the Frazer school to 

the Wolf Point school. She then requested the Frazer School 

Board to approve her tuition application pursuant to 

§ 20-5-302, MCA. The School Board reviewed her application, 

and based on policy and statutory considerations, rejected 

it. 

Appellant appealed the decision to the Valley County 

Superintendent of Schools. By request of the parties, 

Dolores Hughes, County Superintendent of Phillips County, 

heard oral testimony and affirmed the School Board's 

decision. A further appeal to the State Superintendent of 

Public Instruction resulted in reversal of the decision 

denying tuition transfer. The Frazer School Board appealed 

to the District Court, which reversed the order of the State 

Superintendent of Public Instruction and reinstated the 

decision of the Frazer School Board, denying a tuition 

transfer. Appellant appeals from the decision of the 

District Court. 

We are asked to determine whether the decision of the 

District Court complies with the Montana Administrative 

Procedures Act, specifically 5 2-4-704, MCA, and 5 2-4-623, 

MCA, and whether the decision of the Valley County 

Superintendent of Schools is contrary to law. The first 
issue is dispositive, as it is the only issue within the 

scope of review of this Court. 

The Montana Administrative Procedures Act (MAPA) 

permitting "an aggrieved party [to] obtain review of a final 

judgment of a district court . . . by appeal to the Supreme 

Court . . . " set forth at S 2-4-711, MCA, must be followed 

in this case. Yanzick v. School District #23 (1982), 196 

Mont. 375, 383, 641 P.2d 431, 436. The appeal to the County 

Superintendent was in effect a trial de novo with witnesses 

and recorded evidence, while the appeal to the State 

Superintendent was based on the record. 

The standard of review applicable to the District Court 

is set forth in S 2-4-704, MCA, which reads in pertinent 

part: 

(1) The review shall be conducted by the 

court without a jury and shall be 

confined to the record . . . The court, 

upon request, shall hear oral argument 

and receive written briefs. 

(2) The court may not substitute its 

judgment for that of the agency as to the 

weight of the evidence on questions of 

fact. The court may affirm the decision 

of the agency or remand the case for 

further proceedings. The court may 

reverse or modify the decision if 

substantial rights of the appellant have 

been prejudiced because the 

administrative findings, ... conclusions, or decisions are: 

(e) clearly erroneous in view of the 

reliable, probative, and substantial 

evidence on the whole record; 

Under this section, neither the District Court nor the 

Superintendent of Public Instruction may substitute his 
judgment for that of the County Superintendent as to the 

weight of the evidence on questions of fact. 

When considering whether the District Court erred in 

its review of the State Superintendent's decision, we will 

not overturn the District Court unless we find its decision 

to be clearly erroneous. Rule 52 (a), M.R.Civ.P. In this 

proceeding the District Court was not the trier of fact. We 

have here an appeal from a lower appellate tribunal, the 

State Superintendent of Public Instruction, which in turn 

based his conclusions on a review of the printed record, 

without the benefit of listening to and observing the 

demeanor, conduct, and testimony of witnesses. We will 

reverse or modify the decision only if substantial rights of 

the appellant have been prejudiced because the administrative 

findings and conclusions are clearly erroneous in view of the 

reliable, probative and substantial evidence on the whole 

record. See Yanzik, supra, 196 Mont. at 388, 641 P.2d at 

439. 

MAPA provides that the County Superintendent shall hear 

all controversies relating to tuition application and take 

testimony to determine the facts. Section 20-3-210, MCA. 

This procedure was followed. The statute also provides for 

an appeal of the decision of the County Superintendent to the 

State Superintendent of Public Instruction, who makes a 

decision based on the record. This procedure also was 

followed. 

The standard of review for the State Superintendent is 

found in Rule 10.6.125, Administrative Rules of Montana, 

(ARM). The Superintendent of Public Instruction has 

incorporated by reference the Model Rules of the Attorney 

General for rule making procedure. Pursuant to that 

procedure, Rule 10.6.101, Scope of Rules, was adopted, and 

became effective in September, 1982. Subsection (e) says: 
All controversies arising under any other 

provision of Montana law or federal law 

for which a procedure for resolving 

controversies is not expressly prescribed 

shall be governed by these rules. 

Rule 10.6.125, ARM, sets out the standard of review for the 

State Superintendent. Subsection (4) of the Rule is 

virtually identical to § 2-4-704(2), MCA. 

10.6.125 APPELLATE PROCEDURE-STANDARD OF 

REVIEW. 

(4) The state superintendent may not 

substitute his judgment for that of the 

county superintendent as to the weight of 

the evidence on questions of fact. The 

state superintendent may affirm the 

decision of the county superintendent or 

remand the case for further proceedings 

or refuse to accept the appeal on the 

grounds that the state superintendent 

fails to retain proper jurisdiction on 

the matter. The state superintendent may 

reverse or modify the decision if 

substantial rights of the Appellant have 

been prejudiced because the findings of 

fact, conclusions of law and order are: 

(a) in violation of constitutional or 

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 in view of the 

reliable, probative and substantial 

evidence on the whole record; 

(f) arbitrary or capricious or 

characterized by abuse of discretion or 
clearly unwarranted exercise of 

discretion; [or] 

(g) because findings of fact upon issues 

essential to the decision were not made 

although requested. 

The decision of the State Superintendent was appealed 

to the District Court. After reviewing the record the court 

determined that in reaching a different result under the same 

set of facts the State Superintendent exceeded his authority 

by substituting his opinion for that of the Frazer School 

Board and the County Superintendent. We agree. After our 

review of the record, we conclude it contains substantial 

evidence supporting the County Superintendent's findings of 

fact. The State Superintendent's order includes findings 

which are not part of the record, or are irrelevant, or are 

conjectures or conclusions, rather than facts. Findings of 

the reviewing agency properly cannot be included as facts 

when they are not part of the findings below. It is 

irrelevant that the School District approved a tuition grant 

for another family who had a child in need of special 

education. The School Board has broad discretionary 

authority in this area pursuant to § 20-5-302, MCA. Further, 

there is evidence on the record the Board exercised its 

discretionary authority according to the criteria found in 

§ 20-5-302, MCA. 

The order of the State Superintendent of Public 

Instruction substitutes the Superintendent's judgment for 

that of the Valley County Superintendent of Schools, in 

violation of Rule 10.6.125, ARM. The reviewing agency must 

confine itself to an analysis of whether the findings are 

clearly erroneous in view of the reliable, probative, and 

substantial evidence on the whole record, or are arbitrary or 

capricious or characterized by abuse of discretion. 
The District Court in reviewing the order of the State 

Superintendent of Public Instruction is required to and did 

adhere to this standard. Thus, it did not err in finding the 

State Superintendent had exceeded his authority. Therefore 

the order of the District Court upholding the Frazer School 

Board's denial of tuition transfer is affirmed 

@&. 

V?e concur: / 

Justices 
Mr. Justice John C. Sheehy, dissenting: 

The majority opinion is written in complete ignorance of 

the only real issue in this case: Whether the Frazer School 

Board considered the factors set out in 5 20-5-302, MCA, in 

denying Flynn's out-of-district tuition money. The Board 

failed miserably and its decision should not be affirmed. 

When approval is sought from a school board. for 

out-of-district tuition so that pupils can attend elementary 

schools, the members of the school board individually are to 

consider under 5 20-5-302, MCA, the following factors: 

(1) The distance and road conditions between the 

child's residence and any school of his resident 

district; 

(2) The training center of the child's parents; 

(3) An opportunity to live with his relatives; 

(4) Dormitory facilities in the district to be 

attended; 

(5) The living conditions of the child's family; 

(6) The availability of transportation; or 

(7) The type of educational program available in 

the school to be attended. 

The Flynn's appealed the denial by the School Board of 

their tuition transfer request to the county superintendent. 

Only two of the factors set out in S 20-5-302, MCA, were 

considered by the county superintendent. She found in 

finding no. 10 that each of the petitioners is provided 

transportation by the school district to the Frazer school 

and that each of the petitioners lived nearer to the Frazer 

school. than to the Wolf Point school. None other of the 

factors set out S 20-5-302, MCA, were considered by the 
county superintendent, nor were they considered by the school 

Board. 

If we look at the minutes of the October 14, 1984 

meeting of the School Board at which the tuition transfer 

request was denied, we find the only reasons suggested by the 

district superintendent to the Board were: (1) "874 monies 

are theoretical, (2) the principle of quality of education, 

and (3) this will not set a good precedent." 

Under the testimony of one of the school district board 

members before the county superintendent, it developed that 

the Board habitually ignores the requirements of § 20-5-302. 

He testified: 

Q. Has the Board had a policy concerning tuition 

transfers? A. Yes. Our policy since I have been 

on is that, as long as a person lives on a bus 

route, we do not grant tuition. 

Mr. Clark was further asked on the factors considered by him 

as a board member: 

Q. Available transportation, trade center, road 

conditions, emergency service, relatives in Wolf 

Point, and the children already started their 

education in Wolf Point. Are those legitimate 

reasons for transfer of tuition under the statutes 

of Montana? A. No, not in my opinion. 

It is obvious that the School Board has set itself above 

the law, and when tuition transfers are requested, such 

requests will be denied if the applicant child lives on a 

school bus route. Yet, availability of transportation is 

only one of the factors set out in § 20-5-302, MCA, that the 

board should consider and pass upon individually. 

When the appeal was taken by the Flynns from the 

decision of the county superintendent further denying the 

tuition transfer to the State Superintendent of Public 

Instruction, the State Superintendent saw the flaw in the 

school board proceedings and corrected the same by reversing 
the county superintendent and directing the school board to 

provide tuition transfers. The State Superintendent was 

right as rain. 

The majority opinion complains that the State 

Superintendent "substitutes the superintendent's judgment for 

that of the Valley County Superintendent." He certainly did, 

and rightly so. The decision of the School Board, and of the 

county superintendent, were clearly erroneous in view of the 

reliable probative and substantial evidence on the whole 

record ($ 2-4-704 (2) (e) , MCA) and the decision of the School 

Board and of the county superintendent was arbitrary, 

capricious, an abuse of discretion and a clearly unwarranted 

exercise of discretion. Section 2-4-704 (2) (f) , MCA. 

The only stricture on the State Superintendent when an 

appeal is taken to him from a county superintendent is that 

he may not "substitute his judgment for that of the county 

superintendent as to the weight of the evidence on questions 

of fact." Rule 10.6.125 (4), A.R.M. In this case the 

superintendent did not substitute his judgment for that of 

the county superintendent on questions of fact because there 

were no questions of fact to weigh. The school board and the 

county superintendent failed entirely to consider the factors 

required to be considered under 5 20-5-302, MCA for tuition 

transfers. The State Superintendent was perfectly correct in 

determining that such procedure before the School Board and 

before the county superintendent was arbitrary, capricious 

and required to be overruled. 

I would affirm the decision of the State Superintendent, 

and thus reverse the District Court. 

*/ 

I concur in the foregoing dissent: