NO. 87-05
IN THE SUPREME COURT OF THE STATE OF MONTANA
1988
WAYNE E. MAHAN,
Plaintiff and Appellant,
-vs-
FARMERS UNION CENTRAL EXCHANGE, INC.,
doing business as CENEX, a foreign
corporation,
Defendant and Respondent.
APPEAL FROM: District Court of the Thirteenth Judicial District,
In and for the County of Yellowstone,
The Honorable Robert Holmstrom, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Whalen & Whalen; Timothy J. Whalen argued, Billings,
Montana
Boschert & Roschert; Rosemary C. Roschert, Billings,
Montana
For Respondent :
Veeder, Broeder & Michelotti; David A. Veeder argued,
and Robert J. Waller argued, Billings, Montana
For Amicus Curiae:
James Zion, Montana Human Rights, Helena, Montana
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Submitted: October 27, 1988
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Decided: January 24, 1989
Mr. Chief Justice J. A. Turnage delivered the Opinion of the
Court.
Wayne E. Mahan appeals from a judgment based on a jury
verdict denying him damages against the Farmers Union Central
Exchange, Inc. (Cenex), in an action brought by Mahan in the
District Court, Thirteenth Judicial District, Yellowstone
County. We reverse and remand for a new trial.
On February 16, 1983, Wayne E. Mahan was the head devel-
opment engineer at the Laurel Refinery operated by Cenex.
His employment was terminated on that date, effective March
1, 1983. Mahan was sixty years old at the time, and had
worked for more than 30 years for Cenex.
The jury verdict decided against Mahan on two issues,
finding: (1) that Cenex was not guilty of age discrimination
in terminating Wayne Mahan's employment, and ( 2 ) that Cenex
had not breached an implied covenant of good faith and fair
dealing in terminating Mahan's employment.
We will state other facts as they become pertinent.
SHOULD MAHAN'S CHALLENGES TO JURORS FOR CAUSE HAVE REEN
GRANTED ?
Mahan urges as a principal issue on appeal that the
District Court erred in failing to grant challenges for cause
made by Mahan against jurors McCann and Anderson in the voir
dire selection of the jury.
With respect to juror McCann, the followinq col.loquy
occurred:
MR. MICHAET, J. WHALEN: Thank you.
Mr. McCann, you I believe have sat on a case that T
tried during March of this vear; isn't that
correct?
MR. McCANN: That's correct.
MR. MICHAEL J. WHALEN: First, my memory is that on
the special verdict that was returned in that case,
that you answered differently than the remainder of
the jurors on the issue of punitive damages. I'll
ask you whether or not there is something about
punitive damages that is offensive to you in
nature?
MR. McCANN: Yes, there is.
MR. MICHAEL J. WHALEN: Is it your position that
you would not award punitivie damages in any case, v
no matter what instructj-ons the Court might give
you?
MR. McCANN: Yes, that's correct.
MR. MICHAEL J. WHALEN: Your Honor, I respectfully
challenge this juror for cause.
THE COURT: Mr. Veeder, do you wish to inquire of
the juror?
MR. VEEDER: Just briefly, your Honor. Mr. McCann,
if you were given a jury instruction by the Court
that indicated to you that punitive damages were a
proper award or could be found to be a proper award
by the jury in this case, and after hearing all of
the evidence set forth during the trial and knowing
what that instruction was, do you believe you could
not award punitive damages?
MR. McCANN: I don't think I would.
THE COURT: Mr. McCann, the Court will make an
inquiry. It isn't a question of one asking whether
you will or wouldn't, depending on because you
haven't heard the evidence; we all recognize that.
The question is if the Court were to instruct you
that punitive damages were recoverable, if you
found certain facts to be true, and if you found
those facts, would you then follow the Court's
instructions?
MR. McCANN: Yes, I would.
THE COIJRT: All right. The challenge is denied.
MR. MICHAEL J. WHALEN: Do you know of any other
reason, Mr. McCann, why you couldn't be fair and
impartial if you're selected in this case with the
information you have at this point as to the nature
of the case?
MR. McCANN: No, I don't.
In the voir dire questioning of juror Anderson, the
following discussion took place.
MR. MICHAEL J. WHALEN: Mr. Anderson, have you sat
on any of the juries since you've been on this
panel?
MR. ANDERSON: (No oral response.)
MR. MICHAEL J. WHALEN: I believe you've been on
the panel since last July. Have you sat on any
juries during the last year?
MR. ANDERSON: No.
MR. MICHAEL J. WHALEN: Your answer is no?
MR. ANDERSON: No. The answer is yes.
MR. MICHAEL J. WHALEN: Are you still workinq as an
insurance broker at the present time?
MR. ANDERSON: I'm retired.
MR. MICHAEL J. WHALEN: You're retired?
MR. ANDERSON: I do have some --
MR. MICHAEL J. WHALEN: I can't hear you.
MR. ANDERSON: I said I've been retired.
MR. MICHAEL J. WHALEN: During the years that you
were working as an insurance broker, did you do any
business with the Cenex refinery in Laurel or St.
Paul, Minnesota?
MR. ANDERSON: No.
MR. MICHAEL J. WHALEN: Have you had any direct
business relationships with Cenex?
MR. ANDERSON: No, sir.
MR. MICHAEL J. FJHALEN: You have worked in the
insurance industry for a number of years, as I
understand. If the Court should instruct you on
the subject of punitive damages in this case, would
you be willing to consider the law on that subject
and award punitive damages if you felt that the
facts justified it?
MR. ANDERSON: I was in Helton Life Insurance.
MR. MICHAEL J. WHALEN: But is there anything --
Strike that.
Punitive damages can be allowed by a jury for the
sake of example, if the Court tells you it's a
matter that you can consider. If the Court should
tell you that it is a matter that you can consider
in this case, would you be willing to consider it
fairly and openly?
MR. ANDERSON: Yes, sir.
MR. MICHAEL J. WHAI,EN: You'd be able to follow t.he
law as given to you by the Court?
MR. ANDERSON: Yes, sir.
MR. MICHAEL ANDERSON: Do you know of any reason
why you couldn't be fair and impartial if you are
selected as a trial juror in this cause?
MR. ANDERSON: Would you state that again, sir?
MR. MICHAEL J. WHALEN: Do you have difficulty
hearing?
MR. ANDERSON: Somewhat, yes. And I have a little
'
speech --
MR. MICHAEL J. WHALEN: Excuse me?
MR. ANDERSON: (No oral response.)
MR. MICHAEL, J. WHALEN: Do you have difficulty
hearing me?
MR. ANDERSON: NO, not now.
MR. MICHAEL J. WHALEN: Do you feel you would. have
difficulty hearing the evidence in this case?
MR. ANDERSON: I could hear the evidence.
MR. MICHAEL J. WHALEN: Well, do you think you
could hear it all as we're going along?
MR. ANDERSON: Yes, I do.
MR. MICHAEL J. WHALEN: Do you know of any reason
why you couldn't be fair and impartial if you are
selected as a juror in this case?
MR. ANDERSON: No reason.
MR. MICHAEL J. WHALEN: Do you use a hearing aid at
all?
MR. ANDERSON: Not at all.
MR. MICHAEL J. WHALEN: When you were in the insur-
ance business, did you manage or oversee other
employees?
MR. ANDERSON: That's right, I do -- I have.
MR. MICHAEL J. WHALEN: How many employees did you
have?
MR. ANDERSON: It would vary for the insurance
agents.
MR. MICHAEL J. WHALEN: What would be, generally,
the number that you would have?
MR. ANDERSON: Well, usually it would be about 25.
MR. MICHAEL J. WHALEN: Having been in business
yourself and managed 25 people on some occasions,
do you feel that you would be inclined to favor
management as distinguished from the plaintiff, an
employee in this case?
MR. ANDERSON: Could YOU --
MR. MICHAEL J. WHALEN: Do you feel that you would
be inclined to favor management in this case be-
cause of ---
MR. ANDERSON: Oh, Yes.
MR. MICHAEL J. WHALEN: -- because of your history?
MR. ANDERSON: Yes.
MR. MICHAEL J. WHALEN: You would favor management.
That would he over the plaintiff, who is an
employee?
MR. ANDERSON: (NO oral response.)
MR. MICHAEL J. WHALEN: Whatever the evidence is,
as I understand your answer, you would favor man-
agement; is that correct?
MR. ANDERSON: I would favor management because I
was hiring and -- agents, and it wouldn't be 25
that would seek -- and sometimes it -- they'd quite
[sic] -- you know --
and go to -- they'd quit, yo11
know, and go to other --
MR. MICHAEL J. WHALEN: When you tell me that you
would favor management in this case, is that a
fixed and abiding feeling that you have that you
should do?
MR. ANDERSON: I prefer the management part, yes.
MR. MICHAEL J. WHAL,EN: You wou3.d favor management
in this case?
MR. ANDERSON: Yes.
MR. MICHAEL J. WHALEN: Your Honor, T respectfully
challenge the juror for cause.
THE COURT: Mr. Veeder?
MR. VEEDER: Could you tell me what you mean when
you say favor management?
MR. ANDERSON: I prefer to -- instead of being
strictly agent, I like to manage, and I would
recruit, too, and --
MR. VEEDER: That was your job before?
MR. ANDERSON: Yes, sir.
MR. VEEDER: But --
MR. ANDERSON: I was in the business 27 years, and
I retired the end of '79.
MR. VEEDER: Okay. But the question, sir, is
whether you could hear the evidence in this case
and wait until you fully heard the evidence before
making up your mind, and when you did so, could you
reach a verdict in a fair and impartial basis,
being fair to both the plaintiff and to the defen-
dant in this case?
MR. ANDERSON: Yes, sir.
MR. VEEDER: Could you do that?
MR. ANDERSON: Yes, sir.
MR. VEEDER: So any favoritism that you might feel
for or towards management you could set aside and
hear the evidence fairly?
MR. ANDERSON: Yes, sir.
MR. VEEDER: We have no further questions.
THE COURT: Mr. Anderson, when you said you favored
management, did you mean that while you were work-
ing, you preferred to be in management rather than
out selling?
MR. ANDERSON: That's right.
THE COURT: All right. The challenge is denied.
MR. MICHAEL J. WHALEN: I renew the challenge, your
Honor, for the reason that it is apparent from what
has taken place that the prospective juror will not
be adequately able to follow the proceedings in
this case. He has repeated on more than one occa-
sion that he would favor management in making a
decision in the case.
THE COURT: The challenge is denied.
MR. MICHAEL J. WHALEN: Do you know of any other
reasons that might make it difficult for you to be
fair and impartial in this case, Mr. Anderson?
MR. ANDERSON: Would you repeat that, please?
MR. MICHAEL J. WHALEN: Do you know of any other
reason why it would be difficult for you to be fair
and impartial in this case?
MR. ANDERSON: Mot at all. I wouldn't be partial.
MR. MICHAEL J. WHALEN: Sitting where you are at
the present time, are you inclined to decide this
case in favor of the defendant at this point?
MR. VEEDER: I object, your Honor.
THE COURT: Sustained.
When a prospective juror has an unqualified opinion or
belief as to the merits of the action, that juror is subject
to a challenge for cause. Section 25-7-223, MCA. Generally,
the determination as to whether a prospective juror is quali-
fied or unqualified is left to the sound discretion of the
trial court. This, because the trial court has the advantage
of observing the witness and accordingly the court's decision
to allow a juror to sit should not be set aside unless the
error is manifest, or there is shown a clear abuse of discre-
tion. State v. Williams (1979), 185 Mont. 140, 150, 604 ~ . 2 d
1224, 1229; State v. Russell (1925), 73 Mont. 240, 249-250,
In this case plaintiff's counsel was forced to use two
of his peremptory challenges to excuse prospective jurors
McCann and Anderson from the case. He utilized all of his
peremptory challenges, and points out in brief that there
were other selected jurors against whom he would have used
such challenges.
In Abernathy v. Eline Oil Fields Services, Inc. (1982),
200 Mont. 205, 650 P.2d 772, we had a case where the District
Court intervened during voir dire examination of a juror to
rehabilitate the qualifications of the juror. In Abernathy,
the trial court's discussion with the prospective juror was
more extended. Generally we apply the rule that the trial
court is in a better position to judge the prejusice of
jurors, and that its decision will not be set aside unless
the error is manifest or there is a clear abuse of discre-
tion, Anderson v. Burlington Northern Inc. (Mont. 1985) , 709
P.2d 641, 42 St.Rep. 1738, even where there has been a forced
use of a peremptory challenge. Abernathy, supra. In this
case, however, the error is manifest. McCann obviously had a
fixed scruple against punitive damages and had followed his
scruple in a previous jury trial. Anderson not only stated
he preferred the management side but appeared to have diffi-
culty in speaking and hearing.
The District Court, of course, may supplement the voir
dire examination by his further inquiry, as permitted by Rule
47 (a), M. R.Civ. P. However, in each case here the inquiry by
the District Court was of a general nature, and not pointedly
directed to the manifest "existence of a state of mind in the
juror evincing enmity against or bias in favor of either
party.'' Section 25-7-223(7), MCA. Mahan's counsel was thus
forced to waste peremptory challenges he might have used
elsewhere on the panel.
In Montana the right to a jury trial is secure to all-
and remains inviolate. Art. 11, Section 26, 1972 Mont.
Const. Concomitant with that right is the right to a faj-r
and impartial jury.
Because we reverse and remand for a new trial, there are
other matters raised in the briefs in this appeal which may
be subject to controversy in any retrial. Accordingly, we
will examine those issues for that purpose, pursuant to 5
3-2-204 (3), MCA.
DID THE COURT COMMIT ERROR IN LIMITING THE TESTIMONY OF
PLAINTIFF'S STATISTICIAN WITH REGARD TO AGE DISCRIMINATION?
In Montana, an employee has the right to obtain and hold
employment without discrimination as to age. Section
49-1-102(1), MCA. Courts have recognized that statistics are
commonly used in discrimination cases. As the United States
Supreme Court has observed:
. .. Our cases make it unmistakably clear that
" [sltatistical analyses have served and will con-
tinue to serve an important role" in cases in which
the existence of discrimination is a disputed
issue.
Teamsters v. United States (1977) 431 U.S. 324, 339, 97 S.Ct.
1843, 1856, 52 L.Ed.2d 396, 417.
In this case the court limited the plaintiff's statisti-
cal expert to testimony of statistical tests performed on the
Laurel nonunion employees. The District Court refused to
allow the expert to testify to results from a statistical
analysis of company-wide terminations of employment including
union members.
Obviously, the inclusion of union employees in the
statistical population, whose employment contracts contained
seniority rights, would skew the figures affecting older
terminated nonunion employees as to the probability that
older nonunion employees were discriminated against on the
basis of age. The court was correct in so limiting the
testimony.
The result of the limitation was that the entire popula-
tion of terminated employees considered by defendant's sta-
tistical expert was forty-nine persons. On cross-examination
of defendant's statistical expert, the plaintiff's counsel
used an elementary statistics textbook which indicated such a
number was insufficient for a chi-squared test. The plain-
tiff is not now barred from reinforcing the textbook with
live testimony on retrial relating to the statistical effect
of low-numbered samples.
DID THE COURT COMMIT ERROR IN LIMITING AND EXCLUDING TESTIMO-
NY OF PLAINTIFF'S LABOR RELATIONS EXPERT?
The District Court denied plaintiff's offer of proof
through the witness Allan D. Brown that the policies of the
defendant were d-eficient in good personnel practices; that
the defendant failed to act in good faith, based upon the
information made available to Brown from the case; that the
policies of the defendant in connection with the termination
of personnel in a reduction of force proceedings were not
adequate; that the manner of which Mahan was terminated was
not conducted fairly through a good personnel policy; and
that the actual termination of the plaintiff was unfair under
all the circumstances of the case.
In denying the offer of proof, the District Court indi-
cated that it would limit the testimony of the expert to the
personnel manual then in existence, and that it would not
permit the witness to testify as to his opinion that the
company may have breached the implied covenant of good faith
and fair dealing. The District Court indicated that it was
basing its decision upon the cases of Crenshaw v. Bozeman
Deaconess Hospital (1984), 213 Mont. 488, 693 P.2d 487, and
Flanigan v. Prudential Federal Savings & Loan (Mont. 1986),
720 P.2d 257, 43 St.Rep. 941.
In Crenshaw, relying on Rule 702, M.R.Evid., that the
testimony of an expert is admissible if it will "assist the
trier of fact to understand the evidence or to determine a
fact in issue," this Court said:
The trier of fact's experience does not extend to
Hospital disciplinary guidelines, much less the
ability to evaluate the propriety of such guide-
lines. We find Dr. Vinton's perspective assisted
the jury to understand the evidence and ultimately
the breach of implied covenant of good faith and
fair dealing question at issue. Further, the
Hospital's counsel moved in limine to exclude Dr.
Vinton's testimony. The argument was presented to
the trial judge. The trial court in its broad
discretion admitted the expert testimony. The
trial court's order will not be disturbed on appeal
in the absence of a clear showing of a manifest
abuse of discretion. [Citing cases.]
Crenshaw, 213 Mont. at 405, 693 P.2d at 495.
In Crenshaw, this Court also noted:
The instant case is not a scenario of simple facts.
Fault arising from breach of implied covenant of
good faith and fair dealing is not easily compre-
hensible to the average person. Dr. Vinton's
testimony was based on professional expertise and
experience which the individual jury members were
unlikely to possess. Her testimony assisted the
trier of fact by providing the jury with informa-
tion and a prospective [sic] beyond the common
experience of a lay juror. [Citing authority.]
Crenshaw, 213 Mont. at 502, 693 P.2d at 494.
In Flanigan, this Court approved the foregoing state-
ments from Crenshaw, and went on to state that the District
Court in Flanigan had acted properly in allowing expert
testimony interpreting written employment policies of the
employer.
It appears that the order of the District Court during
trial correctly interpreted our holdings in both Crenshaw and
Flanigan. In the case at bar, the court did permit experts
for both parties to testify as to whether the company com-
plied with or violated its own policies. That ruling, of
course, followed Crenshaw and Flanigan.
As to whether the District Court erred in disallowing
opinion testimony from the expert about the covenant of good
faith and fair dealing, we are unable to say. The offer of
proof did not include t.he specifics on which the proper
testimony of the expert witness would be based. We only
restate that under Flanigan, based on Crenshaw, opinion
testimony from expert witnesses considering the covenant of
good faith and fair dealing is admissible, provided that
foundation testimony is in the record, and the conditions of
Rule 702, M.R.Evid., that the specialized knowledge of the
expert will assist the trier of fact to understand the evi-
dence or to determine the fact of issue are met. Though not
explicitly stated in the record, it appears that part of the
reason for the District Court's refusal of the offer of proof
in this case was based upon the expert's background and
experience, since he had made no study of nationwide policies
and practices relating to terminations in reductions in
force.
DID THE DISTRICT COURT ERR IN ALLOWING DEFENDANT'S STATISTI-
CIAN TO TESTIFY AS TO WHAT WAS SIGNIFICANT STATISTICALLY IN
SHOWING AGE DISCRIMINATION, RATHER THAN LIMITING HIS TESTIMO-
NY TO EXPLAINING WHAT THE TESTS SHOWED IN THE SAME MANNER
THAT PLAINTIFF'S STATISTICIAN WAS LIMITED?
Defendant's statistician, Ira Chorusa, testified as to
three statistical tests that he applied to finish exhibit
13A, an exhibit through which plaintiff's expert had earlier
testified which showed age discrimination. In response to a
question from defendant's counsel as to whether he had found
any statistical significance in the outcome of his tests, he
responded:
A. Well, there is no statistical significance as
an outcome of any of these tests.
Q. What does that mean?
A. What that means is that there is no evidence,
based on these tests, that age was used as a
factor.
The defendant's counsel objected on the grounds that the
testimony went beyond what he was allowed when his expert was
testifying. In chambers, the District Court examined the
previous testimony of plaintiff's expert:
THE COURT: I have before me the series of ques-
tions that you posed to your expert that you had
and the answers which you had typed in advance, Mr.
Whalen, and the last question was, "What does that
mean?" The answer which is typed, and as I recall,
the answer was very close to this, if not almost
verbatim, "It means that this result would occur b~7
chance only 13% of the time, or conversely, the
results are consistent with the pattern of discrim-
ination as to age in terminating employees 8 7 % of
the time. I
'
The District Court made it clear in the discussion in
chambers that it would not permit either expert witness to
testify that there was or was not actual age discrimination
in this case. It appears that the answer of the defendant's
expert came very close to stating that there was no evidence
of age discrimination, although he may have been referring
merely to plaintiff ' s exhibit 13A. In any event, we affirm
the position of the District Court that on retrial the stat-
isticians may testify that their statistical tests show or do
not show patterns of discrimination based on age, but may not
testify to the ultimate conclusion that age discrimination in
his termination was or was not exercised against Wayne Mahan
in this case. The jury should be the final arbiter of that
issue. Rule 7 0 4 , M.R.Evid.
SHOULD THE COURT HAVE INSTRUCTED THE JTJRY ON THE ISSUE OF
RETALIATION?
It is an unlawful discriminatory practice for any em-
ployer to discriminate against an individual because he has
filed a complaint, testified, or participated in any manner
in an investigation or proceedings before the Human Riqhts
Commission. Section 49-2-301, MCA.
Plaintiff testified that he was retaliated against by
his employer in that the employer refused to give him a
letter of reference because he had sued the company, and that
he was not included in the company and employee functions
after he had sued the company.
Under the statutes, acts of retaliation for participat-
ing in proceedings before the Human Rights Commission are
discrimination actions separate and apart from the claim of
d-iscrimination in the original proceedings. It might possi-
bly be considered evidence of bad faith in the original
termination of employment as well as in the retaliation.
Plaintiff was therefore entitled to instructions to the jury
based on his claim of retaliation, as it was for the jury to
determine whether such retaliation actually existed. He was
further entitled to comment on such retaliation in oral
argument.
DID THE DISTRICT COURT ERR IN REFUSING TO ADMIT TESTIMONY OF
THE COMMISSIONER'S COMPLIANCE OFFICER, JERRY KECK?
In hearing the dispute between Mahan and Cenex, Keck
found that there was "probable cause" to believe that Cenex
discriminated against Mahan on the basis of age. Mahan of-
fered the determination testimony at the District Court.
Mahan directs our attention to Rule 8 0 3 ( 8 ) (C) of the Federal
Pules of Evidence which allows public records and reports.
The following are not excluded by the
hearsay rule, even though the declarant
is available as a witness:
( 8 ) Public records and reports. Records,
reports, statements or data compila-
tions, in any form, of public officers
or agencies, setting forth . . . ( C ) in
civil actions and proceedings and
against the Government in criminal
cases, factual findings resulting from
an investigation made pursuant to an
authority granted by law, unless the
sources of information or other circum-
stances indicate lack of trustworthi-
ness.
However, the rule as adopted in Montana, Rule 803 (8)(iv)
M.R.Evid., states:
[Not excluded by the hearsay rule are3
. . . records, reports, statements, or
data compilations in any form of a
public office or agency setting forth
its regularly conducted and regularly
recorded activities, or matters observed
pursuant to duty imposed by law and as
to which there was a duty to report, or
factual findings resulting from an
investigation made pursuant to authority
granted by law. The following are not
within this exception to the hearsay
rule: . . . (iv) factual findings re-
sulting from special investigation of a
particular complaint, case, or incident.
The Commissioner's comments to the Montana Code provides
that it adopted the uniform rule ( 1 9 7 4 ) , rather than the
federal rule "because it was clearer than the Federal Rule
and because it expressed better policy with certain reports
in requiring the official to testify rather than admitting
his report as a hearsay except.ion."
The Commission carefully considered the exceptions to
Rule 803(8), before adopting the uniform rule. The very
investigation information that the federal rule allows is
specifically excluded in the Montana rule. The District Court
did not err in excluding the testimony offered by Mahan.
Another consideration concerning v~hether the testimony
of the compliance officer is allowable is whether as an
expert witness he can testify as to the determination he ma.de
for the Human Rights Commission. Rule 704, M.R.Evid., states:
Opinions on ultimate issue.
Testimony in the form of an opinion or
inference otherwise admissible is not
objectionable because it embraces an
ultimate issue to be decided by the
trier of fact.
The Advisory Committee's Note to Federal Rule 704 (the rule
being identical to the Montana rule) , 56 F.R.D. 183, 284-85
(1972) indicates:
. . . that the "basic approach to opin-
ions, lay and expert, in these rules is
to admit them when helpful to the trier
of fact." ... the rule is not intended
to allow all opinions and would exclude
those "which would merely tell the jury
what result to reach. . ."
It was Keck's intention to testify that he determined
that Mahan had been discriminated against because of his age.
This is a determination for the jury to make. The issue here
is not so complex that the jury is not able to determine
whether there was age discrimination. Moreover, there was
other sufficient evidence offered by both parties from which
the jury could make a reasonable determination of whether
there was age discrimination.
OTHER SPECIFICATIONS OF ERROR
We determine that the court properly instructed the jury
with respect to the issues of bad faith and implied covenant
of good faith and fair dealing in this cause. We find no
error in the offered instructions on these subjects which
were refused by the court.
We conclude it was within the discretion of the District
Court to exclude refinery yield statements; evidence respect-
ing new construction at. the refinery; whether the reduction
of force was caused by the mismanagement of the company; the
relationship of the cost of labor to the cost of producing a
refined product at the Laurel refinery; the benefits of
Mahan's job to the company and his ability to fill the job;
and the exclusion of exhibit 30 which does not particularly
relate to age discrimination. Moreover, it was not error to
allow defendant to offer evidence showing the necessity of
the cost containment program which the defendant contends led
to the reduction in force.
Accordingly, the judgment of the District Court is
reversed, and the cause remanded to the District Court for
further proceedings. Costs to plaintiff.
Chi>f Justice
We concur:
Justices
- 19 -
Justice John C. Sheehy, concurring and dissenting.
I concur with the majority opinion but dissent from its
holding that the "reasonable cause" finding of the state
Human Rights Commission and the testimony of its compliance
officer are not admissible.
After his discharge, Mahan filed a complaint of age
discrimination in employment with the Federal Equal
Employment Opportunity Commission (EEOC). That agency
deferred investigation of Mahan's complaint to the Montana
Human Rights Commission. Mahan filed a perfected state
complaint with the Montana Human Rights Commission on August
19, 1983, based on § 49-2-303, MCA.
After the Commission's staff investigated the complaint,
it made a written finding of reasonable cause to believe
Mahan had been subjected to age discrimination in his
employment with Cenex. The written finding was made on
August 16, 1984. On October 5, 1984, because the complaint
had been pending for more than one year at that point ( S
49-2-509(1)(b), MCA), at the request of Cenex, the Commission
issued a "right to sue letter." This procedure compelled
Mahan to file a - - de novo action in District Court ( 5
.
49-2-509 (7), MCA. ) Mahan filed his complaint in the
District Court on December 6, 1984, including his age
discrimination claim with other theories of recovery against
Cenex.
In a special interrogatory, the jury found that Cenex
was not guilty of age discrimination in terminating Wayne
Mahan.
During the course of the trial the District Court ruled
that Jerry Keck, the compliance officer of the Human Rights
Commission, could not give testimony as to the regular
procedures of the Human Riqhts Commission in investigating a
complaint of age discrimination or his testimony as to where
he obtained the information used in making a findinq. The
court further ruled that the written reasonable cause findinq
issued by the Commission was not admissible. The Human
Rights Commission found that 5 younger engineers were hired
and that 4 older engineers were discharged. One engineer was
hired just 6 months before notice was given to Mahan of his
discharge. Mahan also offered testimony through Keck that by
the action of Cenex in refusing severance pay to Mahan after
he filed an age discrimination complaint, Cenex may have been
in violation of the retaliatory provision of the Human Rights
Act. (Section 43-2-301, MCA.)
The Fluman Rights Commission filed in this appeal an
amicus curiae brief. The purpose of the amicus brief was to
inform the court of the development of law on the
admissibility of Commission findings, the testimony of its
staff members, and the use of statistics gathered durinq
investigation as "probative evidence."
The District Court refused the written finding of
reasonable cause based on Rule 803 (8)(iv), M. R. ~ v i d . The
court denied the oral testimony of Jerry Keck also.
Thus, there are two subissues which should be determined
by us; one, whether the report of reasonable cause was
admissible; and two, whether the oral testimony of Jerry Keck
should have been allowed.
In Chandler v. Roudebush (1976), 425 U.S. 840, 48
L.Ed.2d 416, 96 S.Ct. 1949, the United States Supreme Court
determined that such a report was admissible, relying on S
803 (8)(c) of the Federal Rules of Evidence. Cenex contended
before the District Court (and the District Court agreed) and
now contends that the Rule 803(8) as adopted in Montana is
different from the federal rule and therefore Chandler is not
.
authority.
The pertinent part of Rule 803, M.R.Evid., is as
follows:
Rule 803. Heresay exceptions; availability -
of
declarant immaterial.
The following are not excluded by the hearsay rule,
even though the declarant is available as a
witness:
. . . (8) Public Records and Reports. To the
extent not otherwise provided in this paragraph,
records, reports, statements, or data compilations
in any form of a public office or agency setting
forth its regularly conducted and regularly
recorded activities, or matters observed pursuant
to duty imposed bv law and as to which there was a
duty to report, or factual findings resulting from
an investigation made pursuant to an authority
granted by law. The following are not within this
exception to the hearsay rule: . . . (iv) factual
findings resulting from special investigation of a
particular complaint, case, or incident; and (v)
any matter as to which the sources of information
or other circumstances indicate lack of
trustworthiness.
The Montana Supreme Court Commission on Rules of Evidence, in
adopting what is now Rule 803 (8) purposely departed from the
federal rule. It explained why in its comment contained in
its report to this Court on November 3, 1976:
Exception (8). Public records and reports.
This exception is not the same as Federal Rule
803(8), but is identical- to IJniform Rule (1974)
803 (8) . The Commission chose to adopt the Uniform
provision because it was clearer than the Federal
Rule and because it expressed better policy with
certain reports in requiring the official to
testify, rather than admitting his report as a
hearsay exception.
The guarantee of trustworthiness of this
exception can be found partly under Exception ( 6 ) ,
records of regularly conducted activity, partly
under the assumption that official duty is
regularly performed [R.C.M. 1947, Section
93-1301-7 (14)] and "the unlikelihood that he will
remember details independently of the record."
Adviscry Committee's Note, Supra 56 F.R.D. at 311.
This exception Is consistent with existing Montana
law except that it clarifies several areas where
official reports are to be excluded. R.C.M. 1947,
Section 93-1001-32, provides the entries in
official books or records, made in the performance
of official duty are prima facie evidence of the
facts stated therein. R.C.M. 1947, Section
93-901-1, et. seq., the Uniform Official Reports as
Evidence Act, modernizes this exception to the
hearsay rule. Section 93-901-1, MCA, provides:
"Written reports or findings of fact made by the
officers of this state, on a matter within the
scope of their duty as defined by statute, shall,
insofar as relevant, be admitted as evidence of the
matter stated therein." The adoption of the
exception is intended to remove the restriction of
admitting only reports from state officials, found
in the statute and applied in Richardson v.
Farmers' Union Oil Co., 131 Mont. 535, 553, 312
P.2d 134 (1957). Note that a police report was
excluded in a civil case, but on grounds that it
stated the cause of an injury, in Gagnier v. Zook,
141 Mont. 214, 377 P.2d 101 (1962). This exception
is inconsistent with State v. Snider, 168 Mont.
220, 541 P.2d 1204, 32 St.Rep. 1056, 1062 (1975),
which held a state chemist's report admissible
under Section 93-901-1, RCM (1947), and so this
case is overruled by this exception.
The comment of the Commission made it clear that in
those cases where reports of agency action are refused, it is
"better policy with certain reports in requiring the official
to testifv." The refusal therefore of the District Court to
allow the testimony of Jerry Xeck flies in the face of the
reason adopted by the Commission in refusing the report in
the first place.
There is an internal conflict within the present form of
Rule 803(8). In the first sentence it makes admissible
"factual findings resulting from an investigation made
pursuant to authority granted by law." The authority of the
Human Rights Commission to investigate age discrimination
cases is found j n Chapter 2, of Title 49, MCA.
. Therefore
under the first sentence of 803(8) its report of reasonable
cause should have been admitted. However, subparagraph (iv)
"factual findings resulting from special investigation of a
particular claim, case or incident," seems to take away what
is granted in the first sentence.
In the face of the ambiguity contained in Montana's S
803 (8), the better practice is to fol low the examples of the
federal courts in construing the reports of the EEOC. The
court of appeals for the Ninth Circuit strongly favors the
admission of such reports as these in federal cases. Bradshaw
v. Zoological Society of San Diego (1978), 569 F.2d 1066;
Plummer v. Western International Motels Inc. (1978), 656 F.2d
502. In that Court of Appeals, whose jurisdiction includes
Montana, under the federal system (it is also true in our
system) the report to the Court of the Commission requires a
de novo proceeding.
- - The trier of fact therefore must
determine from the beginning and on its own whether or not an
infraction of the discrimination statutes occurred. The
court said in Plummer:
A civil rights plaintiff has a difficult burden of
proof and should not be deprived of persuasive
evidence. We therefore hold that the plaintiff has
a right to introduce an EEOC probable cause
determination in a Title VII lawsuit, regardless of
what other claims are asserted, or whether a case
is tried to a judge or jury . . .
656 F.2d at 505.
The weight, of course, of this evidence is for the jury7
to decide.
Amicus brief points to a jury instruction in Gilchrist
v. Jim Slemons Imports, Inc. (9th Cir. 19861, 803 F . 2 d 1488,
1500-1501, wherein the Court approved:
The District Judge instructed the jury that "the
letter need be given no greater weight than any
other evidence in deciding the age discrimination
claim" and "that you, the jury, and not the EEOC
are the sole judges of whether or not there was a
violation of the Age Discrimination Employment
Act."
The reason for admitting such reports was expressed by
Smith v. Universal Services, Inc. (5th Cir. 1972), 454 F.2d
154:
. .
. The action of the EEOC is not agency action
of a quasi-judicial nature which determines the
rights of the parties subject only to the
possibility that the reviewing courts might
conclude that the EEOC's actions are arbitrary,
capricious or an abuse of discretion. Instead, the
civil litigation at the district court level
clearly takes on the character of a trial de novo
completely separate from the actions of the EEOC.
(Citation omitted. ) It is thus clear that the
report is in no sense binding on the district court
and is to be gj-ven no more weiqht than any other
testimony given at trial.
This is not to say, however, that the report is
inadmissible. A trial de novo is not to be
considered a trial in a vacuum. To the contrary,
the district court is obligated to hear evidence of
whatever nature which tends to throw factual light
on the controversy and ease its fact-finding
burden.
4 5 4 F.2d at 157.
Though the Court of Appeals for the Ninth Circuit holds
such reports admissible as a matter of right, its view of
admissibility is by no means the minority view. Courts
considering admissibility generally determine that the
question is discretionarv with the courts, and as the brief
of amicus points out, without burdening this opinion with
extraneous citations, reports are admissible as "significant
evidence ," as "discret.ionary, "absent preiudice," in the
"
exercise of "sound discretion," "admissible unless shown not
trustworthy," and similar holdings.
We are also concerned about the impact that a ruling of
inadmissibility for Commission reports would have on other
areas of illegal discrimination. The Human Rights Commission
concerns itself with not only age discrimination, but other
discrimination in employment, in public accommodations, in
housing, in financing and credit transactions, in education,
in insurance and retirement plans, in maternity leave, and in
discrimination by the state. Part 3, Chap. 2, Title 49, MCA.
The better view, to be consistent with the Ninth
Circuit, is to hold such reports admissible, and for the
trial court to instruct the jury to give such reports only
the weight they should be accorded.
In like manner, the oral testimony of Jerry Keck should
have been admitted by the District Court. As an agent of
this State, making an investigation which is authorized by
law, his findings of fact were admissible, and constituted
probative evidence which would be an aid to the jury.
Justice I?. C. Mcnonough dissents and concurs as follows:
I dissent. The trial court's ruling on Mahan's
challenges to jurors for cause was not clearlv erroneous, and
I would affirm the jury's verdict. I concur, however, with
the balance of the majority opinion.
If Mahan's objection for cause to the two jurors was for
a legal cause, this Court would be in as good a position as
the trial court to decide the question. Instead, Mahan's
objection goes to the grounds of unqualified opinion, belief
as to the merits, or existence of the state of mind evincinq
enmity against or biase in favor of a party. The majority
has also alluded to Anderson's possible physical
incompetency. Disqualification of a juror on any of these
grounds is a question of fact to be decided by the trial
judge. Rule 47 (a), M.R.Civ.P. ; Simons v. Jennings (1935),
100 Mont. 55, 46 P.2d 704. By the very nature of a jury
selection proceeding, the challenging party bears the burden
of proof that the proposed juror should be dismissed for
cause. Sirotiak v. H.C. Price Co. (Alaska 1988), 758 P.2d
1271; City of Kotzebue v. Ipalook (Alaska 1969), 462 P.2d 75,
77; Borman v. State (Mich.App. 1967), 229 A.2d 440; State I T .
Davis (Ariz.App. 1983), 672 P.2d 480. For this Court to
reverse a trial court's ruling on a question of fact, we must
find that the ruling is clearly erroneous. Rule 52 (a!,
M.R.Civ.P.
As with any trier of fact, the District Court has the
advantage of observing a prospective juror's demeanor and the
tenor of his answers. Nonverbal communication skills are
important on voir dire in the selection of a jury. See, V.
Starr & M. McCormick, Jury Selection (1985), Chapters 11, 12,
13 and 14. The look on a prospective juror's face sometimes
indicates whether he correctly understands the question and
how his answer is to be taken. This Court discussed the
nature of jury selection proceedings in Watson v. City of
Bozeman (1945), 117 Mont. 5, 10-11, 1 5 P-2d 1781 lB1:
-6
While we feel that under the circumstances of this
case, on proper motion, the trial court should call
in other jurors, we cannot say that its failure to
do so constituted an abuse of judicial discretion.
As is said in State v. Russell, supra [73 Mont.
240, 235 P. 7151 : "The examination of a juror on
his voir dire is no more nor less than the taking
of testimony on the issues raised as to his
qualifications to serve in the case before the
court. . .
. The determination must be left largely
to the sound discretion of the trial court
(Scrihner v. State, 3 0kla.Cr. 601, 108 Pac. 422,
35 L.R.A., N.S., 985; Commonwealth v. Minney, 216
Pa. 149, 65 A. 31, 116 Arn.St.Rep. 763) and, in
determining the question, the trial court, as in
passing upon any other question of fact established
by oral testimony, has the advantage of observing
the witness on the stand, his demeanor and candor,
or lack of candor, and a review of the court's
rulings and findings should be governed by the same
rules as in reviewing any other findings and
judgment based thereon. They should not be set
aside unless error is manifest, or there is shown a
clear abuse of discretion."
It is clear from the colloquy among McCann, Anderson and
the attorneys in this case that the jurors expressed an
opinion, belief or preference. It is also clear, however,
that the jurors said they would put these aside and follow
the instructions of the court.
When jurors on voir dire make conflicting statements, it
is a question of fact for the trial -judge to decide whether
they can act impartially. People v. Duncan ( ~ a l .19601, 350
P.2d 103; Rule 47(a), M.R.Civ.P. The statements made by
these prospective jurors in response to questions by the
court (and counsel for Cenex in Anderson's case) conflicted
with their prior responses to questioning hy counsel. The
court committed no manifest, clearly apparent, or obvious
error, even in the "cold" record. The majority
mischaracterizes the court's questions as too general. In
reality, counsel's questions were as general or more general
than those asked by the court.
The proper approach for deciding whether a juror is
impartial is found in State v. White (1968), 151 Mont. 151,
155-56, 440 P.2d 269, 272. In White, this Court quoted State
v. Allison (1948), 122 Mont. 120, 199 P.2d 279, and said:
"It is a difficult matter at best to ascertain the
real state of mind of a prospective juror with
respect to detecting the existence of bias or
prejudice against one accused of crime. For that
reason this court has said (State v. Russell, 73
Mont. 240, 249, 235 P. 712, 715) that the
determination of the qualification of a juror to
serve in a case before the court 'must be left
largely to the sound discretion of the trial
court. ' Again in State v. Huffman, 89 Mont. 194,
296 P. 789, 790, this court said: ' . . . the
trial court is the judge of the weight to be given
to the testimony adduced on a voir dire
examination.' True, there are cases holding that
when a witness has once admitted bias his
subsequent statements that he can consider the
evidence impartially should be viewed with caution.
But granting the need for careful scrutiny of the
testimony of a witness who has first said 'no' and
then said 'yes,' it still remains the province of
the trial court to decide where the truth lies and
with that determination the appellate court will
not interfere unless a clear abuse of discretion is
shown. State v. Russell, supra."
Although this Court said in Watson and White that appellate
courts would not interfere unless a clear abuse of discretion
is shown, with the adoption of Rule 5 ? (a), M.R.Civ.P., the
test should be whether the court's decision is clearlv
erroneous.
The ma jority's reference to the constitutional right of
a iurv trial is inappropriate. Althouah Mahan's counsel was
forced to use two peremptory challenges on McCann and
Anderson, he did not challenge the jurors who replaced them
for cause. None of the members of the jury that eventually
sat in this case were challenged for cause by Mahan's
counsel. The right to four peremptory challenges is only
statutory. See, 5 25-7-224 (1), MCA. The Legislature could
raise or lower the numher of challenges if it so desired. L t
is merely a means of obtaining a fair and impartial jury.
There is no constitutional right to exercise peremptory
challenges and the loss of such a challenge is not of
constitutional dimension. Ross v. Oklahoma ( 1 9 8 8 3 , U.S.
, 108 S.Ct. 2273.
Y P & ~
ustice
Mr. Justice L. C. Gulbrandson:
I concur with Mr. Justice McDonough.
IN THE SUPREME COURT OF THE STATE OF MONTANA
No. 87-005
WAYNE E. MAHAN, 1
Plaintiff and Appellant, 1
v. ORDER DENYING
FARMERS UNION CENTRAL EXCHANGE, 1 PETITION-OR $ ;
INCS., doing business as PEHEARIN~ co
CENEX, a foreign corporation, 1
Defendant and Respondent. 1
-U
m ZD
The Court having considered the petition for rekeasng
m n
-
of Farmers Union Central Exchange, Inc., and the reep$nspof
u
TV
C
Wayne E. Mahan, thereto, w CX,
- i
IT IS ORDERED:
1. The Court strikes from its original opinion (P. 9,
opinion) any reference that plaintiff's counsel used a
preemptory challenge against juror Anderson.
3
L . In all else, the petition for rehearing is DENIED.
3. Copies hereof to counsel of record.
DATED this day of March
Justices
- 1 -
"here is stricken from the dissent the two sentences
commencing at the bottom of page 29 with the words "Although
Mahan's" and ending on page 30 with the words ahan an's
Counsel. "
Justices R.C. McDonough and L.C. Gulbrandson would grant
the petition for rehearing.