Title: BURGESS v SOFTICH
Citation: N/A
Docket Number: 12850
State: Montana
Issuer: Montana Supreme Court
Date: May 14, 1975

No. 12850 I N THE SUPREME C O U R T O F T H E STATE O F M O N T A N A 1975 LARRY W. BURGESS, P e t i t i o n e r and Respondent, T O N Y SOFTICH, ADMINISTRATOR, L A B O R STANDARDS DIVISION, M O N T A N A DEPARTMENT O F L A B O R AND INDUSTRY, Respondent and Appellant. Appeal from: D i s t r i c t Court of t h e Eighteenth J u d i c i a l D i s t r i c t , Honorable W. W. Lessley, Judge presiding. Counsel of Record: For Appellant : P e t e r 0. Maltese argued, Helena, Montana For Respondent : Berg, Angel, Andriolo and Morgan, Bozeman, Montana Gregory 0. Morgan argued, Bozeman, Montana Submitted: January 9, 1975 Decided: MAY 1 4 ! 9 : 5 'P .' 1 , + jib Filed : M r . J u s t i c e Gene B. Daly delivered the Opinion of the Court. This i s an appeal from a judgment entered i n the d i s t r i c t court, county of Gallatin, granting a w r i t of mandate directing the administrator of the Labor Standards Division, Montana Department of Labor and Industry t o give petitioner Larry W. Burgess a f u l l hearing on a claim f o r unpaid wages a s provided by section 41- 1302, R.C.M. 1947. Petitioner was employed a s a senior process engineer a t Development Technology, Inc., Bozeman, Montana, from M a y 15, 1972, t o October 10, 1973. O n October 10, 1973, p e t i t i o n e r ' s employment was terminated and pursuant t o the terms of h i s employment was given three months severance pay. Petitioner contends t h a t under the terms of h i s employment he was t o be paid a t the r a t e of $1,500 per month, but the employer, Development Technology, Inc., refused t o recognize t h i s and paid him severance pay a t t h e r a t e of $1,166 p e r month. Petitioner i s attempting t o c o l l e c t the $1,000 which remains unpaid a s severance pay a t the claimed r a t e of $1,500 per month. O n December 13, 1973, petitioner assigned h i s claim f o r unpaid wages t o the Montana Department of Labor and Industry, Labor Standards Division, pursuant t o section 41, 1314.2, R.C.M. 1947. O n April 11, 1974, an agent of t h e Labor Standards Division informed petitioner t h a t no hearing would be held a s requested; t h a t t h e agency's manpower and financial resources obligates the agency t o be s e l e c t i v e i n i t s case load. Further t h a t it was discretionary with the department whether o r not t o hold an admin- i s t r a t i v e hearing. O n April 22, 1974, p e t i t i o n e r f i l e d i n the d i s t r i c t court a p e t i t i o n f o r an a l t e r n a t i v e w r i t of mandamus compelling t h e de- partment t o hold a f u l l administrative hearing pursuant t o the Montana Administrative Procedure Act, T i t l e 82, Chap. 42, Revised Codes of Montana 1947, and the Montana Administrative Code t o determine the v a l i d i t y of p e t i t i o n e r ' s claim, or t o show cause why the department should not do so. O n the same day, A p r i l 22, the d i s t r i c t court issued the w r i t and s e t the hearing f o r May 20, 1974. Twice the hearing was continued, u n t i l June 3, 1974. The department f i l e d i t s motion t o quash May 31, 1974, (1) alleging no c l e a r l e g a l duty, and (2) another plain, speedy and adequate remedy a t law was available t o petitioner. Petitioner f i l e d a b r i e f i n support of the w r i t , and the department f i l e d a b r i e f i n support of i t s motion t o quash, prior t o hearing on June 3, 1974. O n June 3 , 1974, the court heard t h e motion t o quash; continued t h e hearing on p e t i t i o n e r ' s w r i t of mandate pending decision on the motion t o quash, and ordered further b r i e f s . O n June 21, 1974, the court denied the department's motion t o quash. By memorandum the court held: t h a t section 41-1302, R.C.M. 1947, r a i s e s t h e question of the department's statutory duty; f u r t h e r , t h a t the department has adopted the relevant sections of t h e Montana Administrative Act; t h a t integrating section 41-1314.2, R.C.M. 1947, on assignment of wage claims, makes the s i t u a t i o n c l e a r e r ; and then concluded: h hat a c t by the respondent [the department] i s a c l e a r l e g a l duty under t h e law. The discretion ap- pears a f t e r t h e hearing, not before. I I The d i s t r i c t court entered judgment granting the w r i t of mandate on June 28, 1974. From t h a t judgment the department appeals, presenting two issues f o r review: 1. The Labor Standards Division has no c l e a r l e g a l duty t o provide Larry W. Burgess with an administrative hearing. 2. A n a l t e r n a t i v e , plain, speedy and adequate remedy i n the ordinary course of the law e x i s t s . Appellant department c i t e s authority supporting the r u l e t h a t f o r mandamus t o l i e there must be a c l e a r legal duty and mandamus w i l l not l i e t o control discretion; a l l p a r t i e s and t h i s Court agree. Montana's Wage Payment Act, T i t l e 41, Chap. 13, R.C.M. 1947, governs the payment of wages earned by employees by employers. Section 41-1302, R.C.M. 1947, provides: "It s h a l l be the duty of the commissioner of labor t o inquire d i l i g e n t l y f o r any violations of t h i s a c t , and t o i n s t i t u t e actions f o r the collection of unpaid wages and f o r the penalties provided f o r hekein, in such cases a s he may deem proper, and t o enforce generally the provisions of t h i s act." (Emphasis ours). Respondent, p e t i t i o ~ r i n d i s t r i c t court, f a i l s i n h i s I 1 argument t h a t actions" include "administrative hearings" a s used t o imply discretion i n section 41-1302, R.C.M. 1947. Of the heretofore quoted portion of section 41-1302, the f i r s t p a r t places I I a mandatory duty on the commissioner of labor t o inquire d i l i - gently", t h e second part t o i n s t i t u t e "actions" i n such cases a s he may deem proper, and the t h i r d part i s mandatory a s t o enforcing the a c t . The language of t h i s section i s c l e a r and unambiguous. It needs no i n t e r p r e t i v e help from t h i s Court. The only interpretation required concerns the scope of "inquire diligently". Section 41-1314.1, R.C.M. 1947, gives the department powers of investigation t o determine violations of the act, including power t o administer oaths, examine witnesses under oath, issue subpoenas, and take depositions and a f f i d a v i t s i n any proceeding before t h e department. This section i s compatible with holding a hearing and/or investigation. Standing alone i t does not resolve the issue here, a s contended by appellant. The t r i a l court and respondent discuss section 41-1314.2, R.C.M. 1947, yet appellant dismissed it very casually i n i t s reply b r i e f by the assertion t h a t it only applies a f t e r the commissioner makes a "determination". This section i s authority t o take wage assignments and s t a t e s i n p a r t : I I Whenever the commissioner determines t h a t one o r more employees have claims f o r unpaid wages, he s h a l l , upon the written request of the employee, take an assignment of the claim i n t r u s t f o r such employee, and may maintain any proceeding appropriate t o enforce the claim, including liquidated damages pursuant to this act. With the written consent of the assignor, the commissioner may settle or adjust any claim assigned pursuant to this section. " (Emphasis ours). Section 41-1314.2 is one that grants additional authority to the commissioner as it relates to taking assignment of claims in trust. The words "and may maintain any proceeding appropriate to enforce the claim" are words of authority to proceed as a trustee of the employee's claim and not to be construed as granting any discretionary status as it relates to enforcement of the claim or the law generally. It does, however, establish that a determination shall be made and thereafter on request the commissioner shall take I1 the assignment of the claim in trustr' and proceed in a proper manner. the One of the sections of/~ontana Wage Payment Act, passed in 1974, section 41-1314.4, does provide more legislative intent and (though not binding in the instant case as to content), read with section 41-1314.2, R.C.M. 1947, quoted above, adds additional author- ity for the commissioner to enforce claims in this language: "41-1314.4. Court enforcement of commissioner's de- termination. A determination by the commissioner of labor and industry made after a hearing as provided in Title 41, chapters 13 and 23, R.C.M. 1947, may be en- forced by application by the commissioner to a district court for an order or judgment enforcing the determina- tion, if the time provided to initiate judicial review by the employer has passed. The commissioner shall apply to the district court where the employer has its princi- pal place of business, or in the first judicial district of the state. A proceeding under this section is not a review of the validity of the commissioner's determin- ation." (Emphasis ours). Appellant argues this language only makes the process more discre- 11 tionary, and that the Commissioner may enforce his determination; he need not do so." (Emphasis ours). This argument suffers from the same problem as that argued as to section 41-1314.2 heretofore:---the failure to realize that this is a section primarily granting authority and not discretion. Section 41-1314.4 grants considerable authority to the commissioner in fact, it speaks to the authority the commissioner has in regard to judicial enforcement of his determinations including the fact that the commissioner's determination is not reviewable under the authority of the section. It speaks of a determination after hearing. Xeading the two sections together, we find a determination must be made and for judicial enforcement there must be a hearing. At this point appellant department's argument that the corrunissioner can make an effective "diligent inquiry" to reach a I I de~ermination by investigation" only without a hearing, loses a great deal of its persuasion, if only because the determination cdnnot be judicially enforced without a hearing under the language o i section 41.1314.4, R.C.M. 1947. Appellant's argument that no duty to hold a hearing exists under any circumstances because of administrative problems or if a case arose where the commissioner clearly lacked jurisdiction or utter chaos and atronomical waste of state resources may result is not germane to the problem here and simply begs the question at hand. Further, the trial court and respondent have relied in part on the Montana Administrative Procedure Act, Title 82, Chap. 42, R.C.M. 1947 and the Montana Administrative Code. The Montana Administrative Procedure Act was passed in 1972 to implement Article VI, Section 7, 1972 Montana Constitution and provide the framework regarding functions, powers, and duties of executive agencies and to compile and publish the Montana Administrative Code. Each agency was responsible for providing its portion of the Code within the format prescribed. Section 82-4209, R.C.M. 1947, of the Administrative Proced- ure Act provides that in a contested case, all parties shall be afforded an opportunity for hearing after reasonable notice. - A contested case under section 82-4202(3), means any proceeding before an agency in which a determination of legal rights, duties, or privil- eges of a party is required by law to be made after an opportunity for a hearing. Section 82-4202, R.C.M. provides: " ~ e f i n i t i o n s . For purposes of t h i s a c t : " (1) 'Agency' means any board, bureau, commission, department, authority o r o f f i c e r of the s t a t e government authorized by law t o make r u l e s and t o determine contested cases * * *. 1 "(3) Contested case' means any proceeding before an agency i n which a determination of l e g a l r i g h t s , duties o r privileges of a party i s required by-law t o be made a f t e r an opportunity f o r hearing. - 1 . , k *I I , , . (Emphasis ours). Section 82-4209, R..C.M. 1947, provides: I I Notice-hearing-record. (1) In a contested case, a l l p a r t i e s s h a l l be afforded an opportunity f o r hearing a f t e r reasonable notice. 11 The Montana Department of Labor and Industry under i t s organizational r u l e of t h e Administrative Code, 24-2.1-0100 (2) (b) , has charged i t s Labor Standards Division with the "duty of enforcing a l l the laws of Montana r e l a t i n g t o hours of labor, conditions of labor, prosecution of employers who default i n payment of wages, protection of employees >k * *," The Labor Standards Division adopted model procedural r u l e s proposed by the attorney general a t 24-3.14(2)- P1410, Montana Administrative Code, a s contained i n T i t l e 1, Sub- chapter 2, Rules of Procedure 1-1.6(2)-P640 through 1-1.6(2)-P6320, Xontana Administrative Code. The model procedural r u l e s adopted by the Labor Standards Division comment further on the d e f i n i t i o n of "contested case" defined i n section 82-4202(3), R.C.M. 1947, a t 1-1.6(2)-P607Oy (2) (a) , Montana Administrative Code : l I Contested eases provide an opportunity f o r a person t o obtain a hearing before an agency t o contest t h e agency's intended action against him o r action which d i r e c t l y a f f e c t s him." (Emphasis ours). Subdivision (3) of 1-1,6(2)-P6070, generally s t a t e s t h a t among the e s s e n t i a l requirements of a contested case a r e a f a i r hearing, the r i g h t t o j u d i c i a l review upon a proper record, and a l l of the elements of due process. Appellant department does not comment on the application of these Montana code sections and Montana Administrative Code sectioqs other than t o a s s e r t t h a t there i s no application here because I f a contested case" implies a hearing which t h e commissioner i s not by law required t o provide a wage claimant. This argument overlooks the f a c t t h a t the sections of the Administrative Code which make it c l e a r t h a t a hearing must be granted i n t h i s case where the board ruled against the p e t i t i o n e r or i t s action d i r e c t l y a f f e c t s him, were voluntarily adopted by the department a s the law regulating procedure before it. Appellant further alleges t h a t respondent has an a l t e r - native, plain, speedy and adequate remedy i n the ordinary course a t l a w so mandamus must f a i l i n any event. It c i t e s section 93- 9103, R.C.M. 1947, and numerous Montana cases i n support. The a l t e r n a t i v e , plain, speedy and adequate remedy proposed by appellant i s an a l t e r n a t e method of wage collection under the s t a t u t e t h a t does not involve the Labor Department. It appears t h a t appellant has misconstrued section 93-9103, R.C.M. 1947. To deny mandamus under section 93-9103, there must be a plain, speedy and adquate remedy i n the ordinary course of law, t h a t can be pursued by the petitioner t o compel the performance o f a n a c t which the law has imposed a s a duty, i . e . an a l t e r n a t e t o supersede mandamus t h a t i s competent t o afford the r e l i e f on the very subject matter of p e t i t i o n e r ' s application f o r a w r i t of mandate. S t a t e ex r e l . Federal Land Bank v. Hays, 86 Mont. 58, 282 P. 32; S t a t e ex r e l . Brink v. McCracken, 91 Mont. 157, 6 P.2d 869. There- fore the a l t e r n a t i v e suggested by appellant,not being within the contemplation of the doctrine of mandamus, must f a i l . W e conclude t h a t i n cases wherein the department's pre- liminary inquiry i s against the wage claimant there i s a c l e a r , l e g a l duty, upon request, t o grant a hearing. The judgment of the district court is affirmed. The cause is remanded to the district court for determination of attorney fees and costs. - Justice We Concur: ................................... Chief Justice - u ................................ Justices. ....................... Mr. Chief Justice James T. IJarrison dissenting: I dissent. I do not feel that the laws with relation to payment of wages and protection of discharged employees should be interpreted to require the Commissioner of Labor to hold a hearing upon demand. If a claim asserted by a discharged employee, upon investigation by the Commissioner, appears to be without merit I would not burden the Commissioner by requiring him to hold a hearing to determine what he already knows - the claim lacks merit. Nothing is taken away from an employee, if he is not satisfied with the Commissioner's view he can institute a suit under the statutes and if he is successful he will recDver his wages, costs, penalty and attorney fees. , # Chief Justice. M r . J u s t i c e Castles dissenting: I dissent. The language of section 41-1302, R.C.M. 1947, i s c l e a r t h a t the authority and discretion of the Labor Standards Division i s such t h a t no one can demand a formal I I hearing. The duty of the commissioner i s t o inquire diligently". That i s a l l . For analogous wording in a s t a t u t e , section 16-3101, R. C.M. 1947, requires a county attorney t o "diligently prosecute1'. Yet, we a l l recognize t h a t those words man t h a t he s h a l l exercise h i s discretion. Here, we have the words "inquire diligently". Obviously, it seems t o me, an investigation and inspection would suffice. t h e remedy a t law f o r enforcement of labor claims and wage collection under section 93-9103, R.C.M. 1947, i s adequate, and thus mandamus would not be proper. Perhaps a w r i t of c e r t i o r a r i , but c e r t a i n l y not a w r i t of mandamus. S t a t e ex r e l . Thompson v. Babcock, 147 Mont. 46, 490 P.2d 808. Section 41-1314.2, R.C.M. 1947, authorizes, i n e f f e c t , a power of attorney t o the commissioner of labor. This alone d i c t a t e s t h a t the actions of the commissioner a r e discretional. Also, the discussion of the e f f e c t of the Montana Adminis- t r a t i v e Procedure Act on the meaning of s t a t u t e s previously enacted i s r e t r o a c t i v e reasoning. I do not agree. I would reverse the d i s t r i c t court and deny the p e t i t i o n f o r a w r i t of mandamus. --.