Title: STATE EX REL FALLON COUNTY v DIST
Citation: N/A
Docket Number: 12383
State: Montana
Issuer: Montana Supreme Court
Date: December 26, 1972

No. 12383 I N THE SUPREME COURT OF THE STATE OF MONTANA 1 9 7 2 THE STATE OF MONTANA, ex re1 FALLON COUNTY, MONTANA, P l a i n t i f f , THE DISTRICT COURT OF THE SIXTEENTH J U D I C I A L DISTRICT OF THE STATE OF MONTANA, I N AND FOR THE COUNTY OF FALLON, and t h e HONORABLE ALFRED B. COATE, JUDGE PRESIDING THEREIN, D e f e n d a n t s . ORIGINAL PROCEEDING: For Plaintiff: H a b e d a n k , Cumming 6 B e s t , Sidney, M o n t a n a . O t t o T. H a b e d a n k and Jacque W. B e s t argued, S i d n e y , M o n t a n a . For D e f e n d a n t s : G e n e H u n t l e y argued, B a k e r , M o n t a n a . S u b m i t t e d : D e c e m b e r 4 , 1 9 7 2 - ,, < ; ,; 9 .j7> D e c i d e d : O L L ,- .. F i l e d : ,-JL ! ,-' , ' C l e r k "ir. .Justice Frank I. tiaswell delivered the Opinion of the Court. Thrs i s an o r i g i n a l proceeding seeking supervisory control LQ eeview and reverse a denial of summary judgment t o defendant i n a damage action by a motorist who allegedly suffered personal i n j u r i e s i n an automobile accident. The order denying summary judgment was entered i n the d i s t r i c t court of the sixteenth judi- c i a l d i s t r i c t , Fallon County, by the Hon. Alfred B. Coate, d i s - t r i c t judge. Relator, defendant below, i s Fallon County. Respondent i s the d i s t r i c t court and the judge thereof t h a t entered the order denying summary judgment. P l a i n t i f f i-n the d i s t r i c t court action was Earl 1 4 . Holce who alleged t h a t he sustained personal i n j u r i e s i n a single vehicle accident on a county road i n Fallon County, Montana, on August 2 7 , 1968. His complaint alleges negligence on the p a r t of defendant Fallon County i n f a i l i n g t o properly maintain and mark 'l I 1 a T intersection of county roads. The existence of l i a b i l i t y insurance precluding the defense of sovereign immunity was a l - leged. The action was f i l e d more than two years, but l e s s than three years, a f t e r the date of the accident, One of the defenses pleaded i n defendant's amended answer was t h a t p l a i n t i f f ' s action was barred by the two year s t a t u t e of limitations i n section 93-2607(1), R.C.M. 1947, governing actions "upon a l i a b i l i t y created by s t a t u t e other than a penalty o r forfeiture." Defendant moved for summary judgment on t h i s basis. Subsequently the d i s t r i c t court entered i t s order denying defendant's motion f o r summary judgment. Defendant thereupon f i l e d an o r i g i n a l proceeding i n t h i s Court seeking a w r i t of supervisory control t o review and re- verse the order of the d i s t r i c t court denying i t summary judgment. Foll-owing ex parte presentation, t h i s Court found t h i s t o be a proper case f o r supervisory control and issued an a l t e r n a t i v e w r i t s e t t i n g the matter f o r adversary hearing on December 4, 1972. A t t h a t time, o r a l argument was heard on behalf of both p a r t i e s and the decision taken under advisement. The sole issue f o r review i n t h i s proceeding i s whether p l a i l l t i f f ' s action i s barred by the two year s t a t u t e of limita- tions contained i n section 93-2607(1), R.C.M. 1947. Relator county contends t h a t p l a i n t i f f ' s action i s barred thereunder because it i s an action "upon a l i a b i l i t y created by s t a t u t e other than a penalty or forfeiture". Relator argues t h a t p l a i n t i f f ' s action f a l l s i n t h i s category because section 40-4402, R.C.M. 1947, waives "sovereign immunity" t o the extent of the county's l i a b i l i t y insurance coverage thus permitting p l a i n t i f f ' s action. According t o r e l a t o r , no l i a b i l i t y would i s e x i s t absent section 40-4402, whichlthe t e s t of whether l i a b i l i t y i s created by s t a t u t e within the meaning of s t a t u t e s of limita- t i o n s , c i t i n g in support: Hollinger v, Board of County Commissioners, 115 Kan, 92, 222 P. 136; Barrows v. Lehigh Valley R.Co., 62 N.Y.S. 200; Anno. 32 ALR2d 1240, 1243. Finally, r e l a t o r contends t h a t I I sovereign immunity" presents a j u r i s d i c t i o n a l issue r a t h e r than involving simply a matter of affirmative defense. Respondent, on the other hand, contends t h a t p l a i n t i f f ' s a c t i o n i s not subject t o the two year s t a t u t e of limitations a s an action upon a l i a b i l i t y created by s t a t u t e , but on the con- t r a r y i s governed by the three year s t a t u t e of limitations applicable t o personal injury negligence actions contained i.n section 93-2605, R,C.M. 1947. Respondent argues t h a t section 40-4402, R.C.M. 1947, permitting actions against a county t o the extent of i t s l i a b i l i t y insurance coverage, simply removes the defense of sovereign immunity and i s not a j u r i s d i c t i o n a l i s s u e creating l i a b i l i t y . Respondent c i t e s Beeler v. Butte & London Copper Development Co., 41 Mont. 465, 472, 110 P.528, 530, as controlling authority a s well a s several cases from other jurisdictions i n support: Jones v. City of Alhambra, 1 1 7 C.A.2d 728, 256 P.2d 628; Gonzalez v. Pacific F r u i t Express Co., D.C. Nev., 99 F.Supp. 1012; Hoffman v. idair, D.C.Ore., 193 F.Supp.727; v , Warford, 14aricopa County Municipal C.D.No.11 69 Ariz.1, 206 P.2d 1168. I n our view, the r a t i o n a l e i n Beeler determines the i s s u e i n t h i s case. There we held t h a t although an action against a fellow servant f o r personal i n j u r i e s was not maintainable under common law prior t o passage of a Montana s t a t u t e permitting such action, nevertheless the action was subject t o the three year s t a t u t e of limitations on personal injury actions and not t o the two year s t a t u t e on "a l i a b i l i t y created by s t a t e " , The r a t i o n a l e i n Beeler i s explained i n the following excerpt a t page 530 of 110 Pacific : "The theory of limitation, a s disclosed i n the chapter of the Code on t h a t subject, has no reference t o the defenses t h a t may o r may not be interposed i n resistance t o a p l a i n t i f f ' s demand; but i t i s grounded i n every instance upon the nature of the demand i t s e l f --- whether it be upon a judgment, written contract, account, e t c . Subdivision 1, 5 6449, must be viewed i n the l i g h t of the f a c t t h a t the phrase ' l i a b i l i t y created by s t a t u t e ' has come t o have a fixed applica- t i o n t o a c l a s s of cases q u i t e d i s t i n c t from those elsewhere mentioned or referred t o i n the same chapter. I f the action a t bar had been f o r i n j u r i e s r e s u l t i n g from the negligence of a vice principal, instead of a fellow servant, it would be recognized a t once a s a s t r a i g h t action i n t o r t , governed, a s t o i t s limitation, without any thought of its being a ' l i a b i l i t y created 1 by s t a t u t e . Now, the f a c t t h a t the injury which i s the basis of the action, resulted from the negligence of a fellow servant instead of a v i c e principal does not a f f e c t the e s s e n t i a l nature of the action; it i s s t i l l an action f o r personal i n j u r i e s founded upon actionable negligence. And while i t may properly be said (see Kelly v. Northern Pac. Ry. Co., 35 Mont. 243, 88 Pac. 1009) t h a t under the a c t approved February 20, 1905, an empfoyet's l i a b i l i t y e x i s t s where none existed before, yet the t r u e function of t h a t a c t must be re- garded, not a s creating a new cause of action, but merely t o carry forward the r i g h t of the injured party and t o remove a defense theretofore available i n t h i s c l a s s of causes (Dillon v. Great Northern Ry. Co, , 38 Mont. 485, 100 Pac. 960). It follows t h a t i n the sense employed by the chapter on limitations of actions, t h i s i s not an action on a ' l i a b i l i t y created by s t a t u t e , ' and the contention t h a t it i s barred by subdivision 1, 5 6449, i s not sound." This r a t i o n a l e i s further strengthened as applied t o the i n s t a n t case by the provisions of section 40-4402, R.C.M. 1947, r e f e r r i n g throughout t o "sovereign immunity" as a defense: I I Sovereign immunity defense prohibited when l i a b i l i t y insured - reduction of award t o policy l i m i t s , Whenever an insurer accepts any premium, money, o r other considera- t i o n from a p o l i t i c a l subdivision of the s t a t e , munici- p a l i t y , or any public body, corporation, commission, board agency, organization, o r other public e n t i t y f o r casualty or l i a b i l i t y insurance, neither such insured nor insurer s h a l l r a i s e the defense of sovereign o r governmental immunity i n any damage action brought against such insured o r insurer, and any agreement i n the insurance contract permitting the defense of sovereign o r governmental immunity i s hereby declared void. N o attempt s h a l l be made i n the t r i a l of an action brought against such p o l i t i c a l subdivision of the s t a t e , municipality, o r any public body, cor- poration, commission, board, agency, organization, o r other public e n t i t y , t o suggest the existence of any insurance which covers i n whole or i n p a r t any judg- ment or award which may be rendered i n favor of plain- t i f f . I f the court s h a l l determine t h a t the defendant could have successfully raised the defense of sovereign or governmental immunity, and i f the verdict exceeds the l i m i t s of the applicable insurance, the court s h a l l reduce the amount of such judgment o r award t o a sum equal t o the applicable l i m i t s t a t e d i n the policy. 1 1 (Emphasis added). Relator seeks t o distinguish Beeler on the b a s i s t h a t it pertains simply t o a procedural change which eliminated a common law defense, while the i n s t a n t case involves a j u r i s - d i c t i o n a l issue bearing on the existence of l i a b i l i t y i t s e l f . The r a t i o n a l e i n Beeler and the language of section 40-4402, R.C.M. 1947, b e l i e such contention. I n Beeler, a s here, l i a - b i l i t y existed under the s t a t u t e where none existed before, buc simply by v i r t u e of removal of a defense previously avail- able and not otherwise, This i s the law of Montana whatever the law may be i n the other jurisdictions under cases c i t e d by r e l a t o r . Judge Coate was correct i n denying r e l a t o r a summary j udgment . The a l t e r n a t i v e w r i t heretofore issued i s vacated and t h i s proceeding dismissed. / Associate J u s t i c e - - - - - - - - - - - - I - - - - - - - - - - - - - - - - - Associate Jusf:ices.