Chance v. Harrison

                                                   No.    95-024
                  IN THE SUPREME COURT OF THE STATE OF MONTANA
                                                          1995


JAMES EDWARD CHANCE,                    III,
                 Plaintiff          and Appellant,
         v.
CAROL THOMAS HARRISON and the
MONTANA HUMAN RIGHTS COMMISSION,
                 Defendants             and Respondents.



APPEAL        FROM:          District  Court of the Fourth   Judicial                          District,
                             In and for the County of Missoula,
                             The Honorable   John S. Henson,  Judge                         presiding.


COUNSEL OF RECORD:
                 For    Appellant:
                             Samuel M. Warren,              St.    Peter        & Warren,      P.C.,
                             Missoula, Montana
                 For    Respondents:
                             Rex Palmer,           Attorneys,         Inc.,       P.C.,    Missoula,
                             Montana
                             Paulette           Kohman,    Montana       Human Rights          Commission,
                             Helena,           Montana


                                                          Submitted           on Briefs:       May 26,           1995
                                                                                Decided:       July        17,    1995
Filed:
Chief       Justice            J.      A.        Turnage            delivered              the     Opinion               of     the         Court.
           James Edward                 Chance,              III      (Chance),             appeals             the      decision                of the
Fourth       Judicial               District                Court,         Missoula           County,              denying            his        motion

for     summary          judgment.                     We affirm.

           The sole            issue             on review             is        whether          the        District               Court             erred

in    denying           Chance's             motion           for      summary          judgment               on the           grounds                that

the     statute          of         limitations                    was equitably                  tolled.

           Carol        Thomas           Harrison                   (Harrison)             went         to     work           for         Chance              in

September           1986.              Harrison               groomed             and trained                 Chance's               horses              and

maintained              and cleaned                    his         barn.          Harrison              terminated                  her      employ-
ment       with         Chance              on     March            17,       1987,         following                   several              alleged

incidents           of     sexual                harassment.

           On September                     28,        1987,          Harrison             filed          a civil               suit             in      the

Fourth       Judicial                District                Court,         Missoula              County,             alleging               various

torts       against             Chance.                     On October               18,         1989,         the        District                    Court

dismissed               Harrison's                     claim.                 The      court             determined                       that           all

allegations               set         forth            in     her      complaint                 stemmed             from           the      alleged
sexual       harassment                 by Chance.                     The court              went           on to        conclude                    that,

pursuant           to    § 49-2-509,                    MCA, a claimant                     alleging               sexual            harassment

must       exhaust            his      or        her        administrative                   remedies                with           the      Montana

Human       Rights            Commission.                          Because          Harrison                 had        not     pursued                  her

administrative                      remedies                 with          the      Human          Rights               Commission,                      the

District           Court            dismissed                her      claim        without           prejudice.

           Harrison            appealed             the District                    Court's          decision                 to this            Court.

In affirming               the        District               Court,         we concluded                  that          5 49-2-509,                    MCA,

provided           Harrison's                    exclusive             remedy.              Harrison               v.     Chance              (1990),
244 Mont.             215,       797 P.2d            200     (Harrison                   I).         We noted,            in        dicta,         that
due      to     the         enactment          of     an amendment                        to      § 49-2-509,                  MCA, between
the      time         Harrison            terminated                her          employment                 with       Chance                and    the

filing          of     her     complaint              in     District                 Court,          the      180-day               statute           of

limitation              for      filing            a claim        with            the        Human Rights                 Commission                may

be equitably                  tolled.              Harrison            I,        797 P.2d             at     208.

          Harrison             filed        a complaint                with           the      Human Rights                Commission                  on

December              20,     1990.           The      hearing               examiner                 determined                that,          while

more          than      180      days        had      elapsed                since             Harrison's              discharge,                   the

statute          of     limitations                 was equitably                       tolled.             The hearing                   examiner

relied          on this          Court's            dicta         in        Harrison              I in       tolling                the      statute

of    limitations.

          Following              a hearing,                 the        hearing                 examiner            held         in        favor        of

Harrison,              awarding            over       $43,000               in        lost        wages       and other                   damages.

Chance          appealed          the       decision           of       the           Human Rights                 Commission                 to    the

Fourth           Judicial               District            Court,               Missoula              County,             arguing                 that

Harrison's              claim          was not        timely            filed            and that            the       180-day               statute

of    limitations                should        not     have been equitably                                 tolled.             Chance          moved

for      summary            judgment           on these             grounds.                   The court               denied             Chance's

motion          for     summary             judgment,             upholding                    the     decision                of     the      Human

Rights          Commission.                   Chance          appeals                 the       denial         of      his          motion          for

summary          judgment.

          Did         the      District             Court         err            in     denying             Chance's                motion          for

summary          judgment              on the       grounds            that           the      statute          of limitations                      was

equitably              tolled?
         We review               a district                    court's                denial          of        a summary             judgment
motion         de nova.              Summary             judgment             is        proper        only       when there                 exists
no genuine            issue          of     material              fact        and the             moving         party          is    entitled

to     judgment            as a matter              of        law.       Rule           56(c),        M.R.Civ.P.;                    Minnie           v.

City      of     Roundup             (1993),            257 Mont.              429,         849 P.2d             212.

          Chance           argues           that         Harrison's                     claim         with        the       Human           Rights

Commission             should              have        been      time-barred                     because          she       did       not      file

her      complaint              within              the         180-day                 statute            of     limitation.                         We

disagree.

          On March             17,          1987,         the         date         of     Harrison's                  termination,                    an

appeal         to    the     Human Rights                     Commission                 was not           Harrison's                exclusive

remedy.             Pursuant           to our            decision             in        Drinkwalter              v.      Shipton            Supply

Company,            Inc.      (1987),             225 Mont.              380,            732 P.2d            1335,        an individual

alleging            sexual       harassment                    could          initiate               proceedings                directly              in

the     district            court          without            first          filing         a complaint                  with        the     Human

Rights         Commission.                   In     Drinkwalter                    we stated:

          If we were to decide             the Human Rights       Act provides         the
          sole and exclusive           remedy for all     claims     arising      out of
          sexual     harassment,       we would also be imposing           the 180 day
          statute       of limitation        found in § 49-2-501(2),            MCA, on
          every     possible       remedy.               We therefore         find      the
          imposition        of the 180 day statute          of limitations          to be
          further      proof of the legislature's          intent    that the Human
          Riqhts      Act not be the sole remedv for acts which                       also
          qive     rise     to a cause         of action      independent        of     the
          statute.

Drinkwalter,                732 P.2d              at     1339          (emphasis                added).

           However,            on April                 16,     1987,         after         Harrison's                  termination              but

prior       to      the     filing           of     her        initial             complaint               in    District             Court,               a

legislative                amendment               of     § 49-2-509,                    MCA, went               into       effect.              The

amendment            added           the     following                provision                 to    § 49-2-509,                 MCA:

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                     (7)     The provisions         of this       chapter      establish     the
           exclusive          remedy      for    acts       constituting          an alleged
           violation         of    this     chapter,       including         acts     that   may
           otherwise        also constitute          a violation        of the discrimina-
           tion     provisions       of Article       II,    section      4, of the Montana
           constitution          or 49-l-102.         No other       claim or request        for
           relief        based upon such acts               may be entertained             by a
           district        court    other    than by the procedures              specified     in
           this     chapter.

This        amendment         effectively                   overruled                this          Court's           decision          in

Drinkwalter            and mandated             that        the        Human Rights                 Act     was the           sole   and

exclusive         remedy         for    a sexual             harassment                cause          of        action.

           Harrison        proceeded            with          her        case         in      District               Court.          The

District         Court       dismissed          her         cause        of     action             based         on the        amended

language         of    5 49-z-509,              MCA,         set        forth         above.               In      affirming         the
District         Court's         decision,             we noted               that         Harrison              might      still      be

able        to   instigate             an    action           with            the      Human          Rights              Commission

despite          the     clear         elapse          of      180        days             since          the       time       of    her
discharge.             We stated:

                    In Erickson     v. Croft   (1988),     233 Mont. 146, 760 P.2d
           706, this        Court   looked   favorably        upon the doctrine        of
           equitable       tolling.     Under that doctrine,           the statute     of
           limitations         may be tolled   when a party        reasonably     and in
           good faith       pursues one of several        possible      legal remedies
           and the claimant          meets three    criteria:

                  "(1)    timely      notice     to the defendant         within     the
                  applicable       statute      of limitations         in filing     the
                  first    claim;     (2) lack of prejudice          to defendant      in
                  gathering       evidence      to defend      against    the    second
                  claim;     and (3) good faith        and reasonable       conduct    by
                  the plaintiff        in fiiing     the second claim."

           Erickson,   233 Mont.        at 150-51,        760 P.2d at 708.              In
           Erickson,   we found no need to adopt                equitable       tolling
           because the appellant         failed    to meet the first        criteria;
           the first     claim    did    not give     adequate       notice      of the
           second claim.       Erickson,        233 Mont.    at 152, 760 P.2d at
           709.


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                 Under      the    facts     of this       case,       the   doctrine         of
          equitable     tolling      may be appropriate           if Harrison       refiles
          her claim       with     the Human Rights             Commission.           Unlike
          Erickson,      here the District           Court claim         may give Chance
          adequate      notice       of     a claim       before        the   Commission.
          Furthermore,         in filing        with    the District           Court,       the
          appellant      appears      to have relied        reasonably        and in good
          faith     upon this       Court's     holding     in Drinkwalter.              As a
          case of first          impression       holding      that      the legislature
          overruled     Drinkwalter,         this    case should         not prevent        the
          appellant     from having her substantive                claims    heard by the
          Human Rights        Commission.

Harrison             I,     797 P.2d             at     208.

          First,            we note          that        at the        time         of the             alleged            torts,          Harrison
had two         legal            remedies.               Pursuant              to     our         decision                in        Drinkwalter,

Harrison           was entitled                   to file            her claim              in District                   Court         or pursue

her      administrative                         remedies             with           the      Human                Rights              Commission.

Unlike         our        recent          decision             in     Hash v.             U.S.          West           (1994),          268 Mont.

326,      886 P.2d                 442,     Harrison                reasonably               and          in       good        faith       pursued

one      of    two          potential               legal           remedies.                We declined                        to      apply       the
doctrine            of equitable                  tolling            in Hash because                          at the           time     of Hash's

claim,         the         legislature                 had        already            amended                  5 49-z-509,                MCA,       and

this      Court           had handed               down its            decision                  in     Harrison                I in      which       we

determined                  that          the         amended          language                   of          §    49-Z-509(7),                    MCA,

precluded                 bringing              sexual         harassment                  claims                 in    district             court.

Hash,         886 P.2d             at     446.         Therefore,              Hash had only                           one legal           remedy,

that      being            to      file         her      claim         with          the         Human            Rights              Commission.

Hash      is    thus            clearly          distinguishable                      from             this        case.

          Harrison               relied          reasonably              and in             good          faith          on this           Court's

holding            in      Drinkwalter.                     A review            of         our         decision                in      Harrison            I

reveals         Harrison                  reasonably                believed              that          the        amended             version        of

§ 49-2-509,                  MCA,         either            was       inapplicable                       to       her      claims           or,       if
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applicable,                        would         not           apply             because                  the      alleged              torts          occurred
before            the         effective                  date            of     the            statute.

                Harrison              filed         her initial                       claim            within          the      applicable                statute

of       limitation.                          The         final               tort             allegedly              occurred               on March              17,

1987,             the         day        Harrison                    terminated                        her       employment                  with         Chance.

Harrison                   filed         her        complaint                        in        District            Court          on September                    28,

1987.             Such a filing                      was weil                   within             the         applicable              three-year                tort

statute                of         limitations.                            Section                27-2-204,               MCA.               Chance         argues

that,            under            Erickson               v.        Croft             (1988),             233 Mont.              146,         760 P.2d            706,

Harrison                   had       a duty              to        file          her            complaint               within              180     days,         the

statute                of         limitations                      applicable                     for          a Human Rights                      Commission
claim.

                Even         if      such        an           interpretation                              of     Erickson              is       correct,            we
conclude                   that       Harrison                 satisfied                        the       X8@-day            filing           requirement.

Prior            to        the      amendments                     to      § 49-z-509,                         MCA, Harrison                  was entitled

to       file         her          complaint                  in        District                 Court.               Only       after            5 49-2-509,

MCA,            was         amended             was           Harrison                    required               to      file          with         the       Human

Rights             Commission.                           The        amendment                     to       § 49-2-509,                 MCA,         went         into

effect                on     April            16,         1987.                  The            180-day            statute             of         limitations

therefore                   commenced                running                  on the              effective              date         of      the      statute,

not         on        March            17,       1987.                     Harrison                     filed         her        initial              claim         in

District                   Court        within                180 days                    of     the       April         16 effective                     date      of

the         amendment.                        Harrison                     therefore                     satisfied               the         Human         Rights

Commission                        statute           of        limitation                        as well            as     the         tort         statute          of

limitation.
          A review           of the record                   reveals       that       Chance was not prejudiced
in      gathering            evidence            to defend            against         the claim            filed      with       the
Human Rights                  Commission.                     Extensive            discovery           took          place        in
conjunction                with      Harrison's               initial           complaint          filed       in     District
Court.            Chance submitted                      depositions             to the hearing                examiner           and
testified             telephonically                    at     the       hearing.             The record             does      not
support       Chance's              allegations               that       he was prejudiced                  by Harrison's
delayed           filing          with     the Human Rights                     Commission.
          Finally,           it     is clear            to this         Court     that    Harrison           acted      in good
faith        in      filing              her     claim         with       the      Human Rights                    Commission.
Harrison           justifiably                 relied        on this       Court's       holding           in Drinkwalter
in pursuing                her District             Court claim.                After     we determined               that     her
claim       was subject                   to      the        amended version                  of    5 49-Z-509,               MCA,
Harrison           promptly          filed        her claim with                the Human Rights                   Commission.
Harrison           demonstrated                 reasonable            conduct         and good faith                throughout
these       proceedings.
          We conclude               that        equitable         tolling          is applicable              to the facts
and circumstances                    of this            case and that             Harrison          has satisfied                the
elements            necessary              to     invoke        equitable             tolling        as discussed                 in
Erickson.              We therefore                 hold       that      there        are no genuine                 issues       of
material           fact      and Harrison                is entitled             to a judgment              as a matter           of
law.        We affirm              the decision               of the District                 Court.

                                                                                  /
                                                                                          ~/Justice
                                                                                      Chief
                                                                                           -LNe--
We concur:




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