Meech v. Hillhaven West, Inc.

No. 88-410

IN THE SUPREME COURT OF THE STATE OF MONTANA

1989

RUSSELL E. MEECH,

Plaintiff,

-vs-

HILLHAVEN WEST, INC., and R. RON

SEMINGSON,

Defendants.

ORIGINAL PROCEEDING:

COUNSEL OF RECORD:

For Plaintiff:

Best Law Offices; Michael Best argued, Great Falls, Montana

For Respondent:

James, Gray & McCafferty; Robert F. James, Great Falls,

Montana

Jackson, Lewis, Schnitzler and Krupman;

Joel P. Kelly argued, and Elizabeth Platte Johnson on

the brief, Los Angeles, California

For Amicus Curiae:

Church, Harris, Johnson & Williams; Cresap S. McCracken,

Great Falls, Montana

Patrick W. Shea; Paul, Hastings, Janofsky & Walker,

Washington, D.C.

Submitted: April 11, 1989

De2ided: June 29, 1989

JUN 2 3 1989

Filedzd ;l#4

sa

CLERK OF SUPRElblE COURT

STATE OF MONTCZI"

1

' '' Clerk

Mr. Justice R. C. McDonough delivered the Opinion of the

Court.

This opinion concerns questions certified to this Court

by the United States District Court for the District of

Montana, Great Falls Division, Honorable Paul G. Hatfield

presiding. The questions are as follows:

(1) Is the Montana Wrongful Discharge From Employment

Act, 55 39-2-901 to -914, MCA, unconstitutional in that it

serves to wrongfully deprive an individual falling within the

purview of the Act from his or her right to "full legal

redress" within the meaning of Article 11, S 16 of the

Montana Constitution?

(2 Are those provisions of the Montana Wrongful

Discharge From Employment Act which expressly prohibit

recovery of noneconomic damages, and limit the recovery of

punitive damages, violative of an individual's right to "full

legal redress" within the meaning of Article 11, 5 16 of the

Montana Constitution?

We answer "No" to both questions.

Petitioner Meech's action in the United States District

Court claims damages for wrongful termination from

employment, breach of the implied covenant of good faith and

fair dealing, and intentional or negligent infliction of

emotional distress. Meech also seeks punitive damages for

allegedly oppressive, malicious, and unjustifiable conduct on

the part of Meech's former employer, respondent Hillhaven.

The claims grew from the alleged wrongful discharge of Meech

by Hillhaven. Hillhaven moved to dismiss asserting that the

Montana Wrongful Discharge From Employment Act (Act)

precluded Meech's common-law claims. Meech responded to the

motion by contending that the Act violated Article 11, 5 16

of the Montana Constitution. Certification of the questions

presented here followed. Before fully answering the

questions, a brief summary of the Act aids in understanding

the issues.

The Act provides the exclusive remedy and procedure for

actions formerly governed to a great extent by common-law

requirements:

Preemption of common-law remedies: Except as

provided in this part, no claim for discharge may

arise from tort or express or implied contract.

Section 39-2-913, MCA. The Act exempts from its provisions

causes of action for discharge governed by other state or

federal statutory procedures for contesting discharge

disputes. For example, the Act exempts from its provisions,

discriminatory discharges, and actions for wrongful discharge

from employment covered by written collective bargaining

agreements or controlled by a written contract for a specific

term. For other wrongful discharge claims, however, the Act

provides the exclusive procedure. Sections 39-2-912 to -913,

MCA. The Act repeals Montana statutes which formerly granted

to both employees and employers the right to terminate the

employment relationship for fault on the part of the other

party. Sections 39-2-504 to -505, MCA (1985). The Act's

provisions on discharge also limit the operation of §

39-2-503, MCA, Montana's "at-will" statute. See 5 39-2-902,

MCA. In place of the prior governing statutes and the

common-law causes of action it abrogates, the Act provides a

statutorily defined cause of action for wrongful discharge.

The Act broadly defines "discharge" to include

constructive discharge. Section 39-2-903, MCA. Covered

employees may sue for discharges defined as wrongful under

the Act. Section 39-2-904, MCA. Three causes of action for

"wrongful" discharge exist under the Act: discharge in

retaliation for an employee's refusal to violate public

policy or for reporting a violation of public policy,

discharge in violation of the express provisions of the

employer's written personnel policies, and discharge for

reasons other than good cause as defined in the Act. The Act

limits the time for bringing a cause under its provisions to

one year from the date of discharge. Section 39-2-904, MCA.

The Act establishes the extent of employers' liability

for wrongful discharge. Under the Act, plaintiffs have no

claim to damages for "pain and suffering, emotional distress,

compensatory damages, or punitive damages, or any form of

damages, except as provided for in subsections (1) and (2)

[of 8 39-2-905, MCA] ." Subsections (1) and (2) of S

39-2-905, MCA, provide damages for lost wages and fringe

benefits, together with interest thereon for a period not to

exceed four years from the date of discharge. The Act

defines the value of employee paid pension plans, insurance

coverage, vacation time, and sick time as fringe benefits.

Subsection (2) provides for an award of punitive damages

where claimants can show by clear and convincing evidence

actual malice or actual fraud. Interim earnings, including

those the claimant could have earned with reasonable

diligence, are to be subtracted from the award for lost

wages. Section 39-2-905 (1), MCA. The Act also provides an

incentive for arbitration as an alternative mechanism for

settling employment disputes. Section 39-2-913, MCA.

Meech in essence argues that the Act denies his

fundamental right to full legal redress under Article 11, S

16 of the Montana Constitution. Meech also contends that the

Act violates equal protection by denying the fundamental

right to full legal redress to a class of claimants without

demonstrating that the classification furthers a compelling

state interest. See Corrigan v. Janey (Mont. 1981), 626 P.2d

838, 38 St.Rep. 545; White v. State (1983), 203 Mont. 363,

661 P.2d 1272; Pfost v. State (1986), 219 Mont. 206, 713 P.2d

495. Hillhaven answers that the Act does not violate equal

protection of the laws or infringe on a fundamental right to

full legal redress because Article 11, S 16 of the Montana

Constitution guarantees only a right of access to courts to

seek a remedy for wrongs recognized by common-law or

statutory authority, and the legislature may alter common-law

causes of action to promote a legitimate state interest. See

Shea v. North Butte Mining Co. (1919), 55 Mont. 522, 179 P.

499; Stewart v. Standard Publishing Co. (1936), 102 Mont. 43,

55 P.2d 694; Reeves v. Ille ~lectricCo. (1976), 170 Mont.

104, 551 P.2d 647. We agree with Hillhaven and overrule

Corrigan, White, and Pfost insofar as they hold that Article

11, § 16 of the Montana Constitution guarantees a fundamental

right to full legal redress.

I.

THE ACT DOES NOT VIOLATE THE FUNDAMENTAL RIGHT OF FULL LEGAL

REDRESS, BECAUSE NO SUCH "FUNDAMENTAL RIGHT" IS CREATED BY

ARTICLE 11, SECTION 16.

Summarized, this section covers the following points:

A. The conclusion that Article 11, 5 16 of the Montana

Constitution does not create a fundamental right results from

examination of long-standing, fundamental principles of

constitutional interpretation.

B. The basic rule that the legislature may alter the

common law harmonizes with an interpretation of Article 11, §

16, as only a mandate to the courts.

C. It also follows from the words of the original

guarantee, and the meaning intended for the 1972 amendment to

the original guarantee, that Article 11, S 16, does not

guarantee a fundamental right to a particular cause of

action, remedy, or redress.

D. Judicial creation of such a fundamental right in this

context would also violate the elemental principle of

separation of powers.

E. Meech's arguments on these points are inapposite.

A. Historically, Courts Have Construed Constitutional

Guarantees in Light of the Particular Abuses Those

Guarantees Seek to Prevent.

In construing a constitutional guarantee, courts "have

looked to the object and purpose to be accomplished by the

provision." C. J. Antieau, Constitutional Construction S

3 . 0 5 (1982) .

A " 'very useful key to the construction [of] a

constitutional guarantee is to inquire what was the evil to

be removed, and what remedy did the new instrument propose; .

.. I#I C. J. Antieau, Constitutional Construction § 3 . 0 5

(1982)(quoting Miller, Lectures on Constitutional Law 82

(1891)1 .

Construing our speedy remedy guarantee in light of the

particular abuses the framers sought to correct supports the

argument that the clause does not guarantee a fundamental

right to "full legal redress." The predecessor to Article

11, 16, was Article 111, § 6 of the 1889 Montana

Constitution, which reads as follows:

Courts of justice shall be open to every person,

and a speedy remedy afforded for every injury of

person, property, or character; and that right and

justice shall be administered without sale, denial,

or delay.

The principal cases Hillhaven relies on, Shea, Stewart, and

Reeves, concluded that Article 111, 5 6 of the 1889

Constitution did not constrict legislative powers because the

article only provided a mandate to the courts to provide

equal access to causes of action recognized at law. Shea,

179 P. at 502; Stewart, 55 P.2d at 696; Reeves, 551 P.2d at

651; cf. State ex rel. Carlin v. District Court (1945), 118

Mont. 127, 164 P.2d 155 (trial court's failure to convene

jury for case long awaiting jury trial because of

inconvenience to jurors violates the mandate in Montana's

remedy guarantee requiring that courts provide a proper

administration of justice); Tooke v. Miles City Production

Credit Association (Mont. 1988), 763 P.2d 1111, 45 St.Rep.

1993 (fact that United States District Courts for the

District of Montana deny federal subject matter jurisdiction

of tort claims against production credit unions weighs for

finding subject matter jurisdiction in Montana District

Courts because Montana's remedy guarantee mandates a forum

for claims cognizable according to applicable law).

Legal history demonstrates that Shea and Stewart reached

the correct conclusion. Article 111, S 6, was not placed in

the Constitution as a directive to the legislature. Rather,

the guarantee was directed at the courts, and it was framed

to provide for equality in the administration of justice.

Prior to the decisions in Shea and Stewart, this Court traced

the guarantee embodied in Article 111, B 6, to Chapter 40 of

the Magna Carta. Stephens v. Nacey (1913), 47 Mont. 479,

482-83, 133 P. 361, 362. The Magna Carta's chapter 40, which

contains language similar to the last segment of ~rticle111,

§ 6, reads as follows:

To no one will We sell, to none will We deny or

delay, right or justice.

A. E. Howard, Magna Carta: Text and Commentary 43 (1964).

The language of the first part of Article 111, § 6, providing

for a speedy remedy for injury to person, property, and

character, resembles commentary on Chapter 40 by the

influential 17th century expositor on the common law, Sir

Edward Coke:

"And therefore every Subject of this Realm, for

injury done to him in bonis, terris, vel persona

[i.e., goods, lands, or person], by any other

Subject, be he Ecclesiastical, or Temporal, Free or

Bond, Man or Woman, Old or Young, or be he

outlawed, excommunicated, or any other without

exception, may take his remedy by the course of the

Law, and have justice and right for the injury done

him, freely without sale, fully without any denial,

and speedily without delay."

Shuman, Oregon's Remedy Guarantee, 65 Or. L. Rev. 35, 39

(1986) (quoting E. Coke, Second Institute 55-56 (4th ed.

1671)) .

Coke's version of Chapter 40 influenced the content

of remedy clauses in many state constitutions:

The constitutions of thirty-seven states contain

passages which, in substance, provide that the

courts "shall be open to every person, and speedy

and certain remedy afforded for every wrong and for

every injury to person, property, or reputation." .

. . [Ilt appears most likely that the highly

influential Sir Edward Coke, commenting on the

Magna Carta more than four centuries after its

adoption, was primarily responsible for the

contemporary forms of the various certain-remedy

provisions.

Note, Constitutional Guarantees of a Certain Remedy, 49 Iowa

L. Rev. 1202, 1202-03 (1964).

Coke's interpretation of the Magna Carta is, in a broad

sense, faithful to its origins. The English feudal nobility

sought through Chapter 40 to eliminate abuses in the writ

system which governed King's courts. The abuses in the

system made the price of the writ obtained by a would-be

litigant a determinant of the quality of justice received.

See generally W. McKechnie, The Magna Carta: A Commentary on

the Great Charter of King John (2d ed. 1914) . The goal of

ending the abuses present in the English writ system

eventually lead to the embodiment of a greater constitutional

principle:

It is evident that the Magna Carta did not put down

the practice of charging heavy fees for writs. Yet

this chapter [Chapter 401, although so frequently

misunderstood and exaggerated, is still of

considerable importance. . . . [Ilt has been

interpreted as a universal guarantee of impartial

justice to high and low; and because, when so

interpreted, it has become in the hands of patriots

in many ages a powerful weapon in the cause of

constitutional freedom.

W. McKechnie, The Magna Carta: A Commentary on the Great

Charter of King John 397-98 (2d ed. 1914).

The recognition of the historical meaning of guarantees

derived from Chapter 40 as mandating that the courts provide

equal access to justice, led to limited interpretations of

remedy clauses when plaintiffs claimed the provisions

constricted the legislature. Wheeler v. Green (Ore. 1979) ,

593 P.2d 777, 789 (citing Davidson v. Rogers (Ore. 1978)

(Linde, J. concurring) 574 P.2d 624); Goldberg v. Musim

(Colo. 1967), 427 P.2d 698; Shoemaker v. ~ountain States

Telephone and Telegraph Co. (Colo. App. 1976), 559 P.2d 721;

Twin Falls Clinic & Hospital Bldg. Corp. v. Hamill (1d.

1982), 644 P.2d 341; Harrison v. Schrader (Tenn. 1978), 569

S.W.2d 822. The concurring opinion in Davidson by ~ustice

Linde set out the rationale for a limited interpretation of

the guarantees in remedy clauses as follows:

The guarantee in article I, section 10, of a

"remedy by due course of law for injury done [one]

in his person, property, or reputation" is part of

a section dealing with the administration of

justice. It is a plaintiffs' clause, addressed to

securing the right to set the machinery of the law

in motion to recover for harm already done to one

- the

of - stated kinds of interest, a guarantee that

dates by way of the original state constitutions of

1776 back to King John's promise in Magna Charta

chapter 40: . . . It is concerned with securing a

remedy from those who administer the law, through

courts or otherwise.

Davidson, 574 P.2d at 625-26 (Linde J., concurring) (emphasis

added) . Put another way:

The guarantee tells those who apply the law when

and how they must do so. It says nothing to

lawmakers, except insofar as they attempt to

interfere with the administration of justice.

Schuman, Oregon's Remedy Guarantee, 65 Or. L. Rev. 35, 67

(1986) (emphasis in original).

In Shea, this Court succinctly explained this point

holding that Article 111, 6, did not constrict the

legislature's power to replace common-law personal injury

actions with actions provided by workers' compensation

legislation:

A reading of the section discloses that it is

addressed exclusively to the courts. The courts

are its sole subject-matter, and it relates

directly to the duties of the judicial department

of the qovernment. It means - - - - -

no-more nor less than

that, under the provzions - - Constitution and

of the

laws constituting them, the courts must be

accessible to -

al

l- ersE alike, without

discrimination^ - - - - or times - - place

at the tfme and the

- places for their sitting, and afford - speedy

or a

remedy for every wrong recognized - - - being

by law as

remedial.

Shea, 179 P. at 502 (emphasis added). Both Stewart and

Reeves quoted Shea for the proposition that the remedy

guarantee, as a mandate aimed exclusively at the courts, does

not constrict legislative powers.

We agree with Shea, Stewart, and Reeves on this point.

The history of the guarantee indicates that framers of state

constitutions inserted remedy clauses to insure equal

administration of justice. Clauses insuring equal

administration of justice are aimed at the judiciary, not the

legislature. Therefore, the history of our provision

supports Hillhaven's argument that our remedy guarantee does

not create a fundamental right to full legal redress. Such a

reading of the remedy guarantee also accords with another

rule recognized in Shea: No one has a vested right to any

rule of common law.

B. No One Has a Vested Right to a Rule of Common Law.

The controversy posed by the first question from the

United States District Court hinges also on whether Article

11, 16, prohibits the legislature from exercising its

plenary power to abrogate the common-law tort causes of

action alleged by Meech. The general rule on the

constitutional authority of state legislatures is that:

[Tlhe people, through the legislature, have plenary

power, except in so far as inhibited by the

Constitution, and the person who denies the

authority in any given instance must be able to

point out distinctly the particular provision of

the Constitution which limits or prohibits the

power exercised.

Missouri River Power Co. v. Steele ( 1 9 0 5 ) , 32 Mont. 433,

438-39, 80 P . 1093, 1094. The g e n e r a l r u l e i s a l s o t h a t no

one has a vested interest in any rule of common law.

Therefore, a s a general proposition, t h e l e g i s l a t u r e , under

i t s p l e n a r y power t o a c t f o r t h e g e n e r a l w e l f a r e , may a l t e r

common-law c a u s e s o f a c t i o n . The l e g i s l a t i v e a c t i o n may n o t ,

however, i n f r i n g e on c o n s t i t u t i o n a l r i g h t s . W e have a l r e a d y

pointed out that historically, Article 11, 5 16, does n o t

c o n s t r i c t t h e power of t h e l e g i s l a t u r e t o a l t e r common-law

causes of action. The more s p e c i f i c i s s u e h e r e i s w h e t h e r

the legislature may alter or abrogate causes of action

sounding i n t o r t .

A t o r t may b e d e f i n e d a s :

[A] c i v i l wrong, o t h e r t h a n b r e a c h o f c o n t r a c t , f o r

which t h e c o u r t w i l l p r o v i d e a remedy i n t h e form

o f a n a c t i o n f o r damages. This, of course, says

n o t h i n g more t h a n t h a t a t o r t i s one k i n d o f l e g a l

wrong, f o r which t h e law w i l l g i v e a p a r t i c u l a r

redress. ...

When it becomes clear that the plaintiff's

interests are entitled t o legal protection against

t h e conduct of t h e defendant, t h e m e r e f a c t t h a t

t h e claim i s novel w i l l not of i t s e l f operate a s a

b a r t o t h e remedy.

At t h e o p p o s i t e extreme i s t h e bold attempt t o

reduce t h e e n t i r e law of t o r t s t o a s i n g l e broad

p r i n c i p l e , t h a t any harm done t o a n o t h e r i s a

wrong, and calls for redress, unless

" j u s t i f i c a t i o n " f o r it c a n b e shown. . . . [Tlhe

r u l e d o e s n o t t e l l u s what t h e law w i l l r e c o g n i z e

a s "harm" t o a n o t h e r , o r a s " j u s t i f i c a t i o n ' ' f o r i t .

T h e r e a r e many i n t e r f e r e n c e s w i t h t h e p l a i n t i f f ' s

i n t e r e s t s , i n c l u d i n g many i n s t a n c e s o f n e g l i g e n t l y

c a u s i n g mere m e n t a l s u f f e r i n g w i t h o u t p h y s i c a l

consequences o r d e p r i v i n g t h e p l a i n t i f f of t h e

b e n e f i t o f a c o n t r a c t , f o r which t h e law w i l l g i v e

no remedy, a l t h o u g h t h e d e f e n d a n t h a s b e e n c l e a r l y

a t fault. . . . I t i s l e g a l j u s t i f i c a t i o n which

must be looked to: the law will hold the defendant

responsible for what the law regards as

unjustified---and so stated, the broad rule [remedy

for every wrong] means little, or nothing.

W. L. Prosser, W. P. Keeton, Prosser and Keeton on Torts 5 1,

at 2-4 (5th ed. 1984) (emphasis in original). Prosser also

explains:

Tort law is overwhelmingly common law, developed in

case-by-case decisionmaking by courts. It is also

influenced by statute. Early in the development of

American tort law, doctrines emerged with respect

to enforcement in tort law of standards derived

from criminal statutes. Tort law is affected also

by statutes explicitly aimed at changing

substantive law rules previously developed by

courts. Survival acts and wrongful death acts are

examples.

W. L. Prosser, W. P. Keeton, Prosser and Keeton on Torts 5 1,

at 19 (5th ed. 1984).

As Prosser demonstrates, wrongs recognized at law are

corrected as provided by law. Legislatures in the

Anglo-American system have long been held to possess the

authority to expand or reduce claims and remedies available

at common law. 0 . W. Holmes, The Common Law 112 (1881).

The law of Montana has long recognized that the courts and

the legislature establish the substantive law governing tort

claims. Early Montana statutes contemplated passage of

legislation altering the common law. For example, § 1-1-109,

MCA, first enacted as part of the Bannack Statutes, states:

The common law of England, so far as it is not

repugnant to or inconsistent with the constitution

of the United States or the constitution or laws of

this state, is the rule of decision in all the

courts of this state. (Emphasis added.)

Similarly, Montana law provides that there "is no common law

in any case where the law is declared by statute." Section

1-1-108, MCA. And statutes in derogation of the common law

are "to be liberally construed with a view to effect their

objects and to promote justice." Section 1-2-103, MCA.

The legislature's exercise of its power to alter the

common law supports in a large part our legal system. And as

pointed out by Hillhaven, much of the legislation altering

the common law concerns the legislature's decisions on the

remedies, redress, or damages obtainable in various causes of

action. For example, the legislature has arguably expanded

liability in adopting comparative negligence in $ 27-1-702,

MCA. Similarly, in S 27-1-715, MCA, the legislature has

provided a remedy where none previously existed by ordering

courts to hold owners of vicious dogs strictly liable in

particular circumstances. Recognition of human rights

violations under Title 49 of the Montana Code Annotated,

prohibition of certain trade practices in the insurance

industry under Title 33 of the Montana Code Annotated, and

expansion of parents' liability for children's torts ( S

40-6-237, MCA) are also instances where the legislature has

acted to expand available causes of action, remedies,

redress, and damages. Other examples undoubtedly exist, and

where these legislative expansions govern causes of action,

courts and administrative bodies are bound to follow their

mandate.

Legislative decisions to expand liability to further

various policy objectives are debated and passed almost

routinely. In a like manner, for policy reasons, the

Legislature debates and passes statutes that take away causes

of action and/or constrict liability. The following are

examples: abolition of a cause of action for alienation of

affection ( S 27-1-601, MCA), abolition of a cause for breach

of promise to marry ( S 27-1-602, MCA), protection for certain

persons against a cause of action for libel ( 27-1-804,

MCA), liability limitations for those rendering emergency

care at an accident scene ( 27-1-714, MCA), liability

limitations for those furnishing alcoholic beverages ( §

27-1-710, MCA) , liability limitations for persons donating

food for charity ( S 27-1-716, MCA), liability limitations for

agents and volunteers of nonprofit corporations, ( § 27-1-732,

MCA) , and liability limitations for nonprofit organizations

sponsoring rodeos and other events, ( B 27-1-733, MCA). Laws

on livestock in open range constitute another legislative

limit on liability of parties who are arguably tort-feasors.

Section 60-7-202, MCA. Landowners also benefit from

legislative limits on liability. For example, under §

23-2-321, MCA, a landowner owes only a duty for acts or

omissions that constitute willful or wanton misconduct to

individuals making recreational use of surface waters flowing

over or through the landowner's property. Similarly, from a

remedy and redress standpoint, property owners benefit from

statutory provisions exempting certain property from

execution. The Index to the Montana Code Annotated lists

over sixty types of property statutorily exempt from

execution. These and other statutes constrain liability and

limit remedies and redress available at law.

In actions governed by the common law, this Court has

also established limitations and expansions of liability.

For example, in Miller v. Fallon County (Mont. 1986), 721

P.2d 342, 43 St.Rep. 1185, this Court abrogated interspousal

tort immunity. Similarly, this Court, acting in its role as

lawmaker, recently imposed on employers the duty of good

faith and fair dealing. Gates v. Life of Montana Insurance

Company (1982), 196 Mont. 178, 638 P.2d 1063. In another

decision, breach of the duty of good faith and fair dealing

arising from obligations in a lease justified an award of

punitive damages. Nicholson v. United Pacific Insurance Co.

(1985), 219 Mont. 32, 710 P.2d 1342.

This Court has also refused to expand common law. For

example, this Court has affirmed a trial court's decision

disallowing evidence of emotional harm to a shareholder where

the tort was committed against the shareholder's corporation.

Moats Trucking Co. v. Gallatin Dairies (Mont. 1988), 753 P.2d

883, 45 St.Rep. 772. Another case held that the guarantee

under Article 11, S 16, does not abrogate a statute of

limitations defense. State v. Perry (Mont. 1988), 758 P.2d

268, 45 St.Rep. 1192.

The above cited examples of legislative and judicial

limitations illustrate that the law, for a variety of policy

reasons, refuses to provide a cause of action, remedy and

redress for every injury. This proposition is expressed in

Latin as damnum absque injuria, meaning a "loss which does

not give rise to an action for damages against the person

causing it." Black's Law Dictionary 345 (4th ed. 1979). The

legislation at issue here similarly alters common-law rights

and duties and arguably denies a cause of action, remedy, and

redress for injuries recognized at common law. If Article

11, 16, guarantees a fundamental right to full legal

redress as embodied in common-law causes of action, then a

myriad of legislation altering common law in a restrictive

manner, as well as the Act, denies this fundamental right.

Shea addressed this issue:

If the contention of counsel should be upheld, the

consequence would be that the legislature would be

stripped of all power to alter or repeal any

portion of the common law relating to accidental

injuries or the death of one person by the

negligence of another.

It is true the legislature cannot destroy vested

rights. Where an injury has already occurred for

which the injured person has a right of action, the

legislature cannot deny him a remedy. But at this

late day it cannot be controverted that the

remedies recognized by the common law in this class

of cases, together with all rights of action to

arise in [sic] future may be altered or abolished

to the extent of destroying actions for injuries or

death arising from negligent accident, so long as

there is no impairment of rights already accrued.

Shea, 179 P. at 503. As Shea demonstrates, if Article 111, §

6, is read as only a directive to the courts to provide for

equal administration of justice, then the rule that the

legislature may alter the common law does not conflict with

the speedy remedy guarantee. Therefore, the general rule

that no one has a vested interest in a rule of common law

refutes Meech's argument that the Act unconstitutionally

deprives him of his fundamental right to full legal redress.

C. THE 1972 AMENDMENT TO ARTICLE 111, § 6, DID NOT

RECOGNIZE OR CREATE A FUNDAMENTAL RIGHT TO FULL

LEGAL REDRESS.

In 1972, Article 111, § 6 of the 1889 Constitution was

amended and inserted in the current Constitution as Article

1 1 16. The amendment added to the Article as underscored

below:

Courts of justice shall be open to every person,

and speedy remedy afforded for every injury of

person, property, or character. No person shall be

deprived - - - full legal redress for injury

of this

incurred in employment for which another person may

- liable-except

be - - fellow employees - -

as to and his

immediate employer - hired - - -

who him if such immediate

employer provides coverage under the Workmen's

Compensation - -of this state. ~ i g h t a n djustice

Laws -

shall be administered without sale, denial, or

delay.

In Reeves, the amended version of Article 111, $ 6 of the

1889 Constitution was held not to constrict the legislature's

decision to alter common law:

As indicated in Shea and Stewart, the legislature

is not constitutionally prohibited from eliminating

common law rights which have not accrued or vested.

The Constitution does not freeze common law rights

in perpetuity.

Reeves, 551 P.2d at 652. There was no comment in Reeves on

the amendment to Article 111, § 6.

1. The Wording Itself. White and Pfost, without

discussing governing precedent, reached the opposite

conclusion construing Article 11, Section 16 of the 1972

Montana Constitution on issues involving governmental

immunity and equal protection. White held that Article 11, §

16, "guarantees that all persons have a speedy remedy for

every injury," and thus the classification resulting from a

cap on tort damages awarded against state governmental

entities violated equal protection. White, 661 P.2d at 1275

(emphasis added). White then concluded that the legislation

violated the guarantee because no compelling state interest

justified denying the fundamental right to full legal redress

for all injuries. White, 661 P.2d at 1275.

In Pfost, this Court faced an equal protection challenge

to an amended version of the damages cap at issue in White.

Pfost cited White and again held that Article 11, Section 16,

provides a "constitutional right to full legal redress for

injury." The phrase "full legal redress" from Article 11, 5

16, played an important role in this determination:

The use of the clause "this full legal redress" has

major significance. It obviously and grammatically

refers to the "speedy remedy afforded for every

injury of person, property, or character. ' I The

adjective "this" means the person, thing or idea

that is present or near in place, time or thought

or that has just been mentioned. Webster's New

Collegiate Dictionary (1981). The constitutional

framers thus construed a "speedy remedy" as

comprehending "full legal redress." A state

constitutional right to full legal redress was

thereby created. Any state statute that restricts,

limits, or modifies full legal redress for injury

to person, property or character therefore affects

a fundamental right and the state must show a

compelling state interest.

Pfost, 713 P.2d at 503.

There are flaws in this reasoning. As pointed out by

Justice Weberls dissent in White, rules on the construction

of constitutional guarantees favor interpretations of the

guarantees in line with former judicial decisions where a

constitutional convention has approved a similar or identical

provision in a new constitution. White, 661 P.2d at 1279

(citing 2A C. Sands, Sutherland Statutory Construction S

45.12, at 37 (4th ed. 1973)). If "this full legal redress"

refers to the speedy remedy in the first clause, then the two

references are identical and the Convention approved Sheals

and Stewart's definition of the guarantee. Shea and Stewart

leave little doubt that our remedy provision does not

guarantee a fundamental right to a particular cause of

action, remedy, or redress. As discussed below, the

delegates narrowly drafted the amendment to accomplish the

single purpose of limiting the lawmakers1 power in

restricting third party actions in workers1 compensation law.

Reliance in Pfost on the definitional and grammatical

construction of the guarantee is flawed in other ways as

well. For example, the word:

"injury" as employed in such a constitutional

declaration implies the doing of some act which

constitutes an invasion of a legal right as

established by statutory or common law,...

16A Am. Jur. 2d Constitutional Law S 616 at 562-63 (2d ed.

1979) (emphasis added). Or, as stated by one commentator, a

"recognized, pre-existing injury is the predicate, not the

subject of the clause. " Schuman, Oregon's Remedy Guarantee,

65 Or. L. Rev. 35, 67 (1986).

Similarly, the redress referred to is legal redress.

Legal means:

Conforming to the law; according to law; required

or permitted by law; not forbidden or

discountenanced by law; good and effectual in law.

Black's Law Dictionary 803 (5th ed. 1979). Legal redress,

then, is redress as provided by law, and redress and remedy

are necessarily connected to what the law defines as a cause

of action.

The words "actions," "cause of action," "right,"

"remedy," and "redress" are often used in a legal sense so

that one implies the other. In fact, they are so related

that at times one necessarily implies the other. However,

there are some important distinctions which must be

maintained. The term "cause of action" has been defined as

follows:

" [Tlhe fact or facts which establish or give rise

to a right of action, the existence of which

affords a party a right to judicial relief." The

cause of action itself is distinguishable from the

form it assumes in its prosecution in the courts.

The facts constitute the cause of action, and the

legal form used to enforce the action is the

remedy.

State v. Preston (Ohio 1962), 181 N.E.2d 31, 36 (quoting

Norwood v. McDonald (Ohio 1943), 52 N.E.2d 67, 72). The

maxim, "For every wrong there is a remedy" thus bestows upon

the person who may be wronged the right to seek redress to be

made whole again in an action, whereas the facts which

entitle a claimant to legal redress is denominated the "cause

of action." Remedy is neither "redress" nor "relief."

Remedy is "[tlhe means by which a right is enforced or the

violation of a right is prevented, redressed, or

compensated.I' Black's Law Dictionary 1163 (5th ed. 1979) .

Therefore, the Act does not deny full legal redress or a

speedy remedy. It simply defines what constitutes the facts

which must be established to obtain remedy and redress in the

context of wrongful discharge.

Similarly, the guarantee of a "speedy remedy" in the

first clause of Article 11, 5 16, means such remedy as is

provided by law. This "full legal redress," following the

guarantee of a speedy remedy, refers to the equal right to be

made whole again by what the law defines as a cause of action

and its elements. Legal requirements and restrictions, as

discussed more fully below, may be part of the entire package

the law calls a cause of action, remedy, and redress. These

restrictions and requirements are not established by our

Constitution. Rather, it is the duty of the courts and the

legislature to establish what constitutes available causes of

action, remedies, and redress. Thus, we disagree with the

notion that the proper grammatical and definitional

construction of the words in Article 11, 5 16 of the Montana

Constitution supports the existence of a fundamental right to

redress so that the legislature may not alter causes of

actions except by a showing that the legislation serves a

compelling state interest. There must be the basis or

underpinning of a cause of action and remedy as defined by

the lawmakers before one arrives at the point of redress.

2. The "Intent of the Framers." Basic rules of

construction favor deriving the meaning of Article 11, 5 16,

from its face. From our discussion above, and apart from

what is referred to later in this opinion as the Ashcraft

amendment, it is apparent that the words of Article 11, 5 16,

only mandate that the courts provide equal access to causes

of action and remedies established by the courts or the

legislature. However, even if an ambiguity exists, the

debates at the 1972 Constitutional Convention reinforce our

initial conclusion.

White ' s and Pfost Is interpretation of the effect of the

1972 amendment to the remedy provision ignores the specific

meaning ascribed to the provision during debates at the 1972

Constitutional Convention. Pfost, 713 P.2d at 508 u urn age,

C. J., dissenting). Moreover, the majority's analysis in

these decisions overlooks the explanation of the amendment in

the Official Text with Explanation of the Proposed 1972

Constitution, a document circulated to inform voters of the

content of the Constitution prior to the vote on its adoption

in 1972. Our beginning discussion focuses on the proceedings

at the Constitutional Convention.

The record from the Constitutional Convention of 1972

demonstrates that the addition to Article 111, B 6, was meant

to address a specific problem created by this Court's

interpretation of a workers' compensation statute:

DELEGATE MURRAY: The committee voted unanimously

to retain this section with one important addition.

The provision as it stands in the present

Constitution guarantees justice and a speedy remedy

for all without sale, denial or delay. The

Committee felt, in light of a recent interpretation

of the Workmen's Compensation law, that this remedy

needed to be explicitly guaranteed to persons who

may be employed by one covered by Workmen's

Compensation to work on the facilities of another.

Under Montana law, as announced in the recent

decision of Ashcraft versus Montana Power Company,

[I56 Mont. 368, 480 P.2d 8121 the employee has no

redress against third parties for injuries caused

by them if his immediate employer is covered under

the Workmen's Compensation law. The committee

feels that this violates the spirit of the

guarantee of a speedy remedy for all injuries of

person, property or character. It is this specific

denial, - - one only, that the committee

and this

intends to alter with the following additional

wording: [Delegate Murray reads the amendment] .

Montana Constitutional Convention, Vol. V, at 1753-54

(emphasis added). Following Delegate Murray's explanation of

the Ashcraft amendment, Delegate Habedank moved for its

deletion:

DELEGATE HABEDANK: Mr. President [Chairman],

ladies and gentlemen. I have no objection to this

being in here if you put it in here with full

knowledge of what you are doing. The decision in

the Ashcraft case, which I heard and which was

brilliantly argued by Mr. Dahood, made quite a

change in what a lot of us thought the law was.

However, they were interpreting a specific statute

of the State of Montana. All that is necessary to

change their interpretation is to amend the statute

of the State of Montana. And you, if you adopt

this particular provision, are writing into the

Constitution by vote of a majority of this group

what I consider to be strictly statutory matter.

Montana Constitutional Convention, Vol. V, at 1755. Delegate

Habedank also expressed concern that the addition would

extend liability for workers' injuries beyond correcting the

decision in Ashcraft:

As I view this amendment, it will not allow anyone

to recover from anyone else without negligence on

the part of the person being charged. However, it

will eliminate the ability of you as an owner to

hire an independent contractor, require him to

carry Workmen's Compensation as a part of the

coverage, and be assured that you will not be sued

on a third party claim.

Montana Constitutional Convention, Vol. V, at 1275. Delegate

Dahood, Chairman of the Convention's Bill of Rights

Committee, responded to both arguments made by Habedank:

I have heard this argument in the Supreme Court, an

argument that had no basis in logic. I have heard

it by several defense counsel who represent the

best of corporate interests, that this is going to

affect the individual property owner, and if he

hires a contractor, he is going to be exposed to a

liability that is unprecedented and they did not

experience before. This it totally untrue. This

section is doing nothing more, and the wording has

been very precisely selected - - - sure that it

to make - -

does nothing more, than place the injured working

--

man back in the status that he enjoyed prior to

1971, a very basic constitutional right which he

enjoyed for 80 years in the State of Montana. . .

Regardless of all this conflict, this

technicality, having to use the word "Workmen's

Compensation" in this particular section, which we

didn't want to do, because the minute we did it we

knew that somebody would jump up and say it's

legislative, but if you're going to draft something

with precision and you want to make sure - -

that all

that you're doing is returning - - - to what it

the law - -

was prior - -

to thisdecision a year ago, you are

compelled, sometimes, in fasKioning this precise

language to use language that may be seized upon by

someone else as legislative. It is not. It is

giving back a basic constitutional right that the

citizen of Montana had prior to that particular

decision.

Montana Constitutional Convention, Vol. V, at 1255-57

(emphasis added).

It is perhaps ironic that the convention delegates

amended the Constitution to correct this Court's restrictive

interpretation of a legislative enactment, and subsequently

this Court in White and Pfost interpreted the addition to

constrict the power of the legislature to alter the common

law. At any rate, the testimony before the Convention

demonstrates that the amendment to Article 11, Section 16,

was to operate in only one particular area of law.

Specifically, the addition prevents lawmakers, that is both

the courts and the legislature, from denying workers'

compensation claimants a cause - action against negligent

of

third parties for job related injuries. The amendment did

not seek to define "full legal redress" as a fundamental

right which could not be altered by the legislature. The

delegates sought to overturn Ashcraft, not Shea. The entire

discussion presupposes the existence of legislative powers to

alter causes of action, remedies, and redress.

The narrow purpose the delegates ascribed to the change

in the remedy guarantee is further reflected in the Proposed

1972 Constitution for the State of Montana, Official Text

with Explanation, circulated to the voters prior to the vote

on adopting the 1972 Constitution. According to the

explanation in the voters' information pamphlet, the

amendment:

Adds to 1889 constitution by specifically granting

to a person injured in employment the right to sue

a third party causing the injury, except his

employer or fellow employee when his employer

provides coverage under workmens [sic] compensation

laws.

Proposed 1972 Constitution for the State of Montana, Official

Text with Explanation, at 6.

In summary, the history of our remedy guarantee, the

rule that the legislature may alter the common law, and the

wording of Article 11, 5 16, support Hillhaven's assertions

that no fundamental right exists to the common-law claims

asserted by Meech. The role the judiciary must maintain in

interpreting constitutional limitations affecting the plenary

power possessed by the people through their legislature, and

through their initiative a n d referendum powers, also supports

Hillhaven's assertions.

D. Deriving A New Fundamental Right From Article 11,

S 16, Violates Separation Of Powers.

Both courts and legislatures make the substantive law.

The Montana Legislature derives its power to make law from

the Constitution's grant of plenary power in Article V, S 1:

The legislative power is vested in a legislature

consisting of a senate and a house of

representatives. The people reserve to themselves

the powers of initiative and referendum.

One conclusion which could be drawn from an application of

White and Pfost to the legislation at issue in this case is

that while the legislature may play a role in expanding

common-law causes of action, its attempts to restrict causes

of action newly created by this Court fails under the

guarantee in Article 11, § 16. Yet, the general rule states

otherwise:

[A] constitutional provision that courts of justice

shall be open to every person, and speedy and

certain remedy afforded for every wrong and for

every injury to person, property, or reputation, is

-

not intended - - limitation upon the legislative

as a

branch of the government where the leaislation - -

2 2 -

i n v o l v e d deals with rightful subjects of

legislation.

16A Am. Jur. 2d Constitutional Law 5 616, at 564 (2d ed.

1979) (emphasis added); and see Salt Lake City v. Utah ~ i g h t

& Traction Co. (Utah 1918), 173 P. 556 (provision only

applies to judicial questions, not meant to allow courts to

usurp legislative power); Wagoner County Election Board v.

Plunkett (Okla. 1956) , 305 P. 2d 525 (provision provides

mandate to judiciary, not intended as a limitation on

legislative branch) .

The interpretation of Article 11, Section 16, called for

by Meech would prevent the legislature and the people through

the initiative process from restricting or modifying the

common law relative to injuries of person, property, or

character. Only this Court's reasoning (good or bad),

however, would restrict this Court ' s own lawmaking function.

Our decision to limit a cause of action would withstand the

strict scrutiny mandated by Article 11, S 16; we would be

applying the test. But a similar decision made by the

legislature could be subject to much closer scrutiny. This

Court would act as the ultimate authority in a vast,

expanding, and ever changing field of law governing important

social and economic rights and duties. It could exclude the

legislature from deciding: What are injuries to an

individual's person, property, or reputation; what wrongs are

actionable; what remedies are available; and what redress

will be given. The present appeal presents this separation

of powers issue.

Gates expanded the law of wrongful discharge by defining

as an injury the breach of the implied covenant of good faith

and fair dealing. Similarly, Nicholson defined the same

injury in the context of a leasehold dispute. Under White's

and Pfost's interpretation of Article 11, 5 16, those

recently recognized injuries would remain a part of our law

despite a legislative mandate to the contrary. Any change in

such determinations could only be accomplished through

constitutional amendment. We agree with Chief Justice

Turnage's dissent in Pfost on this aspect of the issue:

There further can be no question that our courts

are open to every person and speedy remedy afforded

for every injury of person, property, or character;

however, this does not mean that the people have

been denied the right to act through their

legislature in providing a system of law that may

set forth the scope and extent of the remedies

provided by law. For this Court to decide

otherwise requires a denial of the doctrine of

separation of powers in Article 111, Section 1, of

the Montana Constitution.

Pfost, 713 P.2d at 514 (Turnage, C.J., dissenting).

E. Meech's Arauments Are I n a ~ ~ o s i t e .

Meech has several contentions addressing the arguments

supporting Hillhaven's position. First, Meech points out

that in State ex rel. Montana Citizens for the Preservation

of Citizens1 Rights v. alterm mire (Mont. 1987), 738 P.2d

1255, 44 St.Rep. 913, this Court declared null and void the

effect of a voter initiative passed in 1986 amending Article

11, 16, to overrule White and Pfost. The amendment was

held invalid because of an error in the voter information

pamphlet. Montana Citizens, 738 P.2d at 1264. Meech asserts

that the fundamental right to full legal redress remains in

Montana law because the legislature passed the Act under the

authority of the invalid amendment.

This proposition depends on the continued vitality of

White and Pfost. We are overruling White and Pfost and any

decisions relying on White and Pfost to the extent that they

hold Article 11, $ 16, guarantees a fundamental right to a

particular cause of action, remedy, or redress.

Meech further contends that the legislation at issue in

Shea must be distinguished from the Act. Meech asserts that

in Shea, the modification of common law benefited workers,

but here, according to Meech, the legislation only "creates

employers' defenses and eliminates many employees' claims for

recovery." We disagree that the Act must be distinguished

-

from the legislation at issue in Shea for the purpose of

testing its constitutionality under Article 11, § 16. Shea

analyzed the trade-off in employees' and employers' interests

as a result of the passage of workers' compensation

legislation, but the holding rested on an interpretation of

Article 111, § 6, as only a mandate to the courts to provide

for the equal administration of justice. Shea, 179 P. at

502. Thus, Shea does not require this Court to analyze

whether the Act provides an adequate trade for the loss of

common-law wrongful termination claims.

However, this Court's decision in Corrigan could be

construed as placing this jurisdiction in with those that

require an adequate substitute for legislative acts

abrogating common-law remedies. See B. R. Burke,

Constitutional Initiative - - Constitutional Rights did

30: What

Montanans Surrender - Hopes - Securing Liability Insurance,

in of

48 Mont. L. Rev. 53, 66 (1987). Even if Montana law required

an adequate substitute for legal remedies abrogated by the

legislature, as explained below, we disagree that no adequate

remedy for common-law wrongful discharge exists under the

Act. Therefore, we do not reach the issue.

In conclusion, we answer, "No" to the first question

submitted by the United States District Court. Article 11, S

16, does not render the Act unconstitutional as depriving an

individual, in this case Meech, of a fundamental right to the

common-law actions he alleges.

11.

THE ACT SURVIVES EQUAL PROTECTION SCRUTINY BECAUSE IT IS

RATIONALLY RELATED TO A LEGITIMATE STATE INTEREST.

The second question certified from the United States

District Court concerns the validity of the Act's specific:

limitations on damages. The issue as framed is whether the

Act's prohibition on the recovery of noneconomic damages and

punitive damages violates Article 11, 5 16. Our discussion

in answer to this question necessarily extends to an analysis

of the equal protection guarantee found in Article 11, 5 4 of

the Montana Constitution.

White and Pfost interpreted Article 11, S 16, as

guaranteeing a fundamental right of full legal redress for

"all recognized compensable components of injury, including

the right to be compensated for physical pain and mental

anguish and the loss of enjoyment of living." White, 661

P. 2d at 1275. These decisions then went on to hold that the

legislation at issue violated the equal protection guarantee

because no compelling state interest justified denying the

fundamental right found in Article 11, S 16, to the class of

claimants affected by the damages limitation at issue. Here,

the question involving the Act's damages limitation is

similar, and more properly framed as:

Do the limitations on the recovery of certain

damages in the Act violate equal protection because

the Act unconstitutionally burdens a class of

claimants seeking damages for wrongful discharge?

Selection of the proper equal protection test is our first

task in determining this issue.

As discussed in the previous section, no fundamental

right to "full legal redress" exists under Article 11, S 16.

Meech alleges no other infringement of fundamental rights by

operation of the Act, and no suspect classifications are

involved. The strict scrutiny test applies only where

legislative classifications infringe on a fundamental right,

or where the legislature employs suspect classifications such

as race or national origin to define the benefited or

burdened class. See J. E. Nowak, R. D. Rotunda, & J. N.

Young, Constitutional Law Ch. 16, 5 I, at 596-98 (2d ed.

1983). Therefore, the strict scrutiny test does not apply.

We also refuse to employ middle tier scrutiny to analyze

classifications created under the Act. The United States

Supreme Court has employed the middle tier criterion in only

a few situations which are not applicable here. See

generally Butte Community Union v. Lewis (1986), 219 Mont.

426, 432-33, 712 P.2d 1309, 1312. This Court's decisions

have applied the test only where specific directives in the

Montana Constitution protected interests in education and

welfare. See Butte Community Union, 712 P.2d at 1314;

Deaconess Medical Center of Billings Inc. v. Department of

Social and Rehabilitation Services (Mont. 1986) , 720 P. 2d

1165, 43 St.Rep. 1112; State ex rel. Bartmess v. Board of

Trustees (Mont. 1986), 726 P.2d 801, 43 St.Rep. 1713. Our

interpretation of Article 11, $ 16, as only a directive to

the courts distinguishes the interest at issue here from the

interests at stake in those cases.

We determine that the proper level of scrutiny for the

classifications created by the Act's limitation on employers'

liability is provided by the rational basis test. We further

find that the Act's provisions on damages pass equal

protection muster because the Act's disparate treatment of

similar claims is rationally related to a legitimate state

interest.

Until recently, the fundamental body of law governing

available damages in the employment area has been contract

law. Courts, by virtue of their power to alter the common

law, have expanded employers' liability by recognizing tort

claims in the employment context. The legislature has now

acted to reverse this trend by restricting damages for

wrongful discharge. This decision to limit liability

"emerges as a classic example of an economic regulation--a

legislative effort to structure and accommodate 'the burdens

and benefits of economic life.'" Duke Power Co. v. Carolina

Environmental Study Group (1978), 438 U.S. 59, 83, 98 S.Ct.

2620, 2636, 57 L.Ed.2d 595, 617-18. A statutory "limitation

on recovery is a classic economic regulation, . . . [which]

must be upheld if it is reasonably related to a valid

legislative purpose." Boyd v. Bulala (W.D. Va. 1986), 647 F.

Supp. 781, 786 (finding heightened scrutiny inappropriate for

reviewing liability-limitation under requirements of

Virginia's remedy guarantee).

The Court in Duke Power pointed out that use of the

rational basis test harmonizes with the ru1.e that the

legislature may alter the common law:

Our cases have clearly established that "[a] person

has no property, no vested interest, in any rule of

the common law." [citation omitted]. The

"Constitution does not forbid the creation of new

rights, or the abolition of old ones recognized by

the common law, to attain a permissible state

object," [citation omitted], despite the fact that

"otherwise settled expectations" may be upset

thereby.

Duke Power, 438 U.S. at 88, n. 32. The California Supreme

Court also emphasized that where the legislature may alter

the common law, the rational basis test applies to testing

liability-limitations:

[Olur past cases make clear that the Legislature

retains broad control over the measure, as well as

the timing, of damages that a defendant is

obligated to pay and a plaintiff is entitled to

receive, and that the Legislature may expand or

limit recoverable damages so long as its action is

rationally related to a legitimate state interest.

Fein v. Permanente Medical Group (Cal. 19851, 695 P.2d 665,

680 (emphasis in original). This Court, too, in Reeves,

recognized that the rational basis test applied to analyzing

whether liability-limitations imposed through a special

statute of limitations for architects and builders violated

equal protection:

The test of the constitutionality of class

legislation is whether the classification has some

reasonable, just and practical basis and whether

the law operates equally upon every person within

the class. [citations omittedl A statute will not

be stricken down upon constitutional grounds unless

its violation of the fundamental law is clear and

palpable, and the classification it makes is

illusory and unreal. [citation omittedl Applying

these tests, section 93-2619, R.C.M. 1947, does not

violate equal protection of the laws.

Reeves, 551 P.2d at 652. We hold that these decisions

provide the proper rule on which equal protection test

applies to analyzing the Act.

Initially, in applying the rational basis test, it is

important to note that

[i]t has long been the general rule of this Court

that statutes carry a presumption of

constitutionality. [citation omitted] Generally,

"whenever there are differing possible

interpretations of [a] statute, a constitutional

interpretation is favored over one that is not."

Brewer v. Ski Lift, Inc. (Mont. 1988), 762 P.2d 226, 228, 45

St.Rep. 1769, 1772 (quoting Department of State Lands v .

Pettibone (1985), 216 Mont. 361, 374, 702 P.2d 948, 956).

Another rule pertaining to testing legislation under

minimal scrutiny analysis mandates that this Court

must not be concerned with the expediency of the

statute:

"What a court may think as to the wisdom or

expediency of the legislation is beside the

question and does not go to the constitutionality

of the statute. We must assume that the

Legislature was in a position and had the power to

pass upon the wisdom of the enactment, and in the

absence of an affirmative showing that there was no

valid reason behind the classification, we are

powerless to disturb it."

McClanathan v. Smith (1980), 186 Mont. 56, 66, 606 P.2d 507,

513 (quoting State ex rel. Harnmond v. Hager (1972), 160 Mont.

391, 399, 503 P.2d 52, 56). Moreover, in "applying the equal

protection clause to social and economic legislation, great

latitude is given to state legislatures in making

classifications." McClanathan, 606 P.2d at 513.

The remedy provision in the Act, set out below, arguably

classifies wrongful. discharge claimants based on the

magnitude of harm:

Remedies. (1) If an employer has committed a

wrongful discharge, the employee may be awarded

lost wages and fringe benefits for a period not to

exceed 4 years from the date of discharge, together

with interest thereon. Interim earnings, including

amounts the employee could have earned with

reasonable diligence, must be deducted from the

amount awarded for lost wages.

(2) The employee may recover punitive damages

otherwise allowed by law if it is established by

clear and convincing evidence that the employer

engaged in actual fraud or actual malice in the

discharge of the employee in violation of

39-2-904 (1).

(3) There is no right under any legal theory

to damages for wrongful discharge under this part

for pain and suffering, emotional distress,

compensatory damages, punitive damages, or any

other form of damages, except as provided for in

subsections (1) and (2).

Section 39-2-905, MCA. Claimants alleging only wage loss

within a four year period, and only noneconomic damages, are

not adversely affected by the Act's remedy provision.

Claimants seeking damages extending beyond four years, or

claimants suffering from noneconomic harm such as emotional

distress, are foreclosed from pursuing their claims by the

Act's remedy provision. Meech asserts that this difference

in available remedies violates equal protection guarantees.

In addition, Meech argues that the Act unconstitutionally

limits the availability of punitive damages.

The general rule on the plenary power of the legislature

in determining the availability of punitive damages refutes

Meech's argument that the Act unconstitutionally limits such

damages :

There is no vested right to exemplary damages and

the legislature may, at its will, restrict or deny

the allowance of such damages.

22 Am. Jur. 2d Damages 5 239, at 326 (2d ed. 1965). See also

White, 661 P.2d at 1276 (tort claimants have no

constitutional right to punitive damages). We hold that the

Act's provision on punitive damages is constitutional.

We also hold that the Act's classification of claims by

available remedies passes equal protection muster. Again,

these types of limitations are not new to law. Limitations

on recovery for wrongful death, for recovery against common

carriers, and limits for damages on baggage claims are

classic examples of liability-limitations. As explained

below, we conclude that that the Act rationally relates to

promoting a legitimate state interest.

The legislative history of the Act demonstrates that

lawmakers perceived an unreasonable financial threat to

Montana employers from large judgments in common-law wrongful

discharge claims. Testimony in legislative hearings also

indicated to legislators that large judgments in common-law

wrongful discharge cases could discourage employers from

locating their businesses in Montana. The Act's limitation

on damages is intended to alleviate these threats.

Therefore, the Act passes muster on this leg of the test

because promoting the financial interests of businesses in

the State or potentially in the State to improve economic

conditions in Montana constitutes a legitimate state goal.

Buckman v. Deaconess Hospital (Mont. 1986), 730 P.2d 380,

386, 43 St.Rep. 2216, 2223.

We also conclude that the Act relates rationally to

promoting Montana's economic interests. Some awards for

common-law wrongful discharge have included wages which

extend far into the claimant's employment future. See Stark

v. Circle K Corp. (Mont. 1988), 751 P.2d 162, 45 St.Rep. 371.

The effect of the Act's limitations on damages to four years

lost wages rationally relates to reducing this potential

liability. Moreover, the limit itself is not irrational or

so arbitrary that the classification it creates violates

equal protection. As a matter of policy, the legislature

determined that four years should be the maximum period for

consideration of wage loss reasoning that claimants could

generally be expected to find similar employment by the end

of this period. The time period in any given claim is

necessarily speculative. However, statistics before the

legislature supported the conclusion that most wrongful

discharge claimants with reasonable diligence will obtain

other employment within the four year period. Therefore,

judicial deference for the time period at issue is

appropriate. See e.g., Duke Power, 438 U.S. at 91. The same

sort of analysis applies to the Act's limitations on damages

for pain and suffering and emotional distress; the

restriction on recovery rationally relates to the

legislature's legitimate purpose of limiting employers'

liability for wrongful discharge.

It could be surmised too that this particular limitation

relates rationally to another legitimate legislative aim,

that is, it provides for greater certainty in defining an

employer's duties by recalling a contract law limitation on

damages for pain and suffering. See e.g., S 27-1-310, MCA.

As a corollary to this purpose, a greater certainty of the

rights of employees also exists under the Act as a result of

the "good cause" requirement.

For example, in computing contract damages according to

the contemplation of the parties, recovery for

mental anguish is not, as a general rule, allowed.

... the courts evidently believe that the mental

suffering which accompanies a breach of contract is

too remote for compensation.

22 Am. Jur. 2d Damages § 195 (2d ed. 1965). Montana follows

the general rule by prohibiting damages for emotional or

mental distress in most contract actions. Section 27-1-310,

MCA. In contrast, the law generally permits a broader

measure of damages in personal injury actions:

There is no fixed rule or exact standard by which

damages can be measured in personal injury cases.

The law does not assume that a particular injury

calls for a definite amount of compensation, for

just compensation may vary widely in different

cases, even where the physical injury is the same,

especially where the injury is permanent, or where

pain and suffering are involved. When a plaintiff

suffers pain, fright, or humiliation because of a

tort, dollars are awarded as "compensation" but not

as the equivalent of what was suffered. Because of

this lack of equivalence in a major portion of many

personal injury awards, precise rules of damages

are impossible to state.

22 Am. Jur. 2d Damages S 86 (2d ed. 1965) (emphasis in

original). Montana also follows the general rule on damages

for personal injury:

For the breach of an obligation not arising from

contract, the measure of damages, except where

otherwise expressly provided by this code, is the

amount which will compensate for all the detriment

proximately caused thereby, whether - could -

it -

have

been anticipated - -

or not.

Section 27-1-317, MCA (emphasis added).

The differences in calculating personal injury damages

and contract damages points out a problem with the emergence

of tort claims in the employment relationship. Tort claims

for at-will employees compensate for these workers' inability

to control the term of their employment. Gates, 638 P.2d at

1066. Employers, however, are unable to plan for the

extensive liability which may arise from damages available in

these claims. Testimony in legislative hearings indicated

that this is a source of great discontent in the Montana

business community. The Act's limitation on noneconomic

damages applies long-standing contract law in an attempt to

solve this problem by dictating a more objective measure of

damages. Under the Act, employers benefit because their

potential liability is made more certain. Meanwhile,

employees' control over the manner in which they are

discharged remains, in part, as a result of the Act's "good

employees' cause" requirement. The Act, in making this

trade, is in no sense irrational. Therefore, classifications

in the Act satisfy the requirements of the rational basis

test.

Finally, we address the argument mentioned above that

Shea requires the legislature to provide adequate substitutes

for causes of action abrogated by statute. The Court in Duke

Power faced a similar contention based on the Due Process

Clause of the United States Constitution:

The District Court held that the Price-Anderson Act

contravened the Due Process Clause because " [tlhe

amount of recovery is not rationally related to the

potential losses"; because " [tlhe Act tends to

encourage irresponsibility in matters of safety and

environmental protection . . .

"; and finally

because " [tlhere is no quid pro quo" for the

liability limitations. 4 3 1 F. Supp. at 2 2 2 - 2 2 3 .

Duke Power, 4 3 8 U.S. at 8 2 . The Court in Duke Power resolved

the argument for requiring a -- quo as follows:

quid pro

Initially, it is not at all clear that the Due

Process Clause in fact requires that a

legislatively enacted compensation scheme either

duplicate the recovery at common law or provide a

reasonable substitute remedy. However, we need

not resolve the question here since the

Price-Anderson Act does, in our view, provide a

reasonably just substitute for the common law or

state law remedies it replaces.

Duke Power, 4 3 8 U.S. at 8 8 .

Here, too, the benefits of the Act for employees are not

illusory. Therefore, we need not reach the issue as posed by

Meech because the Act provides a reasonably just substitute

for the common-law causes it abrogates.

In some situations the Act may benefit employees by

eliminating common-law defenses formerly available. For

example, in Prout v. Sears (Mont. 1989), 772 P.2d 288, 46

St.Rep. 257, a majority of this Court explained that under

prior Montana law, an employer could defend a discharge suit

by claiming that the employee was let go for no cause:

At the same time we give effect to the employment

application and record time card. These give the

employer the right to fire without cause.

Prout, 7 7 2 P. 2d at 2 9 2 (emphasis added) . Under the Act, the

no-cause defense for discharging an employee who has worked

beyond the probationary period is unavailable to most

employers. Instead, employers may be subject to discharge

only for good cause defined as:

"Good Cause" means reasonable job-related grounds

for dismissal based on failure to satisfactorily

perform job duties, disruption of the employer's

operation, or other legitimate business reason.

Section 39-2-903 (5), MCA. Similarly, the good-cause

provision may provide greater protection for an employee

whose employer has carefully avoided giving objective

manifestations of continued employment, a requirement for

maintaining a cause of action for violation of the covenant

of good faith and fair dealing under the former law. Stark,

751 P.2d at 166. Imposition of a good-cause requirement in

discharge may also provide greater employee protection in

situations, as in Prout, where employers sought to disclaim

in the employment contract any objective manifestations of

continued employment. The Act's provision allowing claims

for prejudgment interest also betters the prior common-law

provisions for recovery.

In addition to the amount awarded for lost wages,

pensions, insurance benefits, and vacation time may be

considered as fringe benefits under the statute. Section

39-2-903(4), MCA. All fringe benefits which would have

accrued during the four year period following the discharge

are available as damages under the Act. Therefore, the Act

contemplates allowing some recovery for wrongful discharges

which would otherwise deny retirement benefits, and more.

To summarize, greater certainty in the law may alleviate

problems experienced by both employers and employees. As

explained by one commentator:

[Tlhe employees who benefit [under common-law cause

of action] are few and far between, first, because

of the difficulties involved in staying the course

of a lengthy and expensive judicial process, and

second, because of limitations inherent in the

legal doctrines adopted by the courts.

Gould, Stemming the Wrongful Discharge - - - -

Tide: A Case for

Arbitration, 13 Emp. Rel. L.J. 404, 413 (1988). Therefore,

Meech's argument that the Act provides an inadequate trade

for prior common-law actions fails to provide authority for

finding the Act unconstitutional.

In conclusion, Montana's remedy clause seeks to

guarantee equal access to courts to obtain remedies for

injuries as provided by governing law. It does not, however,

impart a definition of what the law considers a remedy or

full legal redress. Nor does it empower this Court to

exclude the legislature from defining what are legal

injuries.

Finally, we make clear here that the proper test to

apply to the Act's classifications burdening one class and

not another, is the rational basis test. The classifications

created under the Act at issue here survive scrutiny under

this test, and even if Montana law required a quid - quo

pro

for the old causes of actions, the Act provid-es a reasonable

substitute. Thus, we answer "No" to both questions posed by

the United States District Court.

&if'&~M$&

Justice

We Concur:

/'

'

)

'Chief Justice

Justices

Mr. Justice John C. Sheehy, dissenting:

This is the blackest judicial day in the eleven years

that I have sat on this Court. Indeed it may be the blackest

judicial day in the history of the state. Certainly this

decision is more regressive than the ill-boded Ashcraft v.

Montana Power Company (1971), 156 Mont. 368, 480 P.2d 812

case, which deprived injured workers of their full legal

redress against third party tortfeasors. The decision today

cleans the scalpel for the legislature to cut away

unrestrainedly at the whole field of tort redress. Perhaps

worse by this decision today, the Court throws in the sponge

as a co-equal in our tripartite state government.

I.

For the reader to understand the drastic ramifications

of the "Wrongful Discharge From Employment Act" the whole of

the Act must be set out. The legislation passed as Ch. 641,

Laws of Montana (1987). A full copy of the text is attached

to this dissent as Exhibit A. The bracketed numbers thereon

indicate the present number of the code sections of the Act

as they now appear in Montana Code Annotated.

The contraction of what was once in this state the tort

of wrongful discharge is found principally in three sections

of the Act, Section 4 [ § 39-2-904, MCA], Section 5 [ §

39-2-905, MCA] and Section 8 [ B 39-2-913, MCA].

Under Section 4 of the Act [ § 39-2-904, MCA] grounds for

wrongful discharge are limited to three possibilities:

(1) It was in retaliation for the employees

refusal to violate public policy or for reporting a

violation of public policy;

(2) The discharge was not for good cause and the

employee had completed the employers probationary

period of employment; [under the Act, a probationer

has absolutely no right of recourse for a wrongful

discharge] or

(3) The employer violated the express provisions

of its own written personnel policy.

The attorneys in this case supporting the Wrongful

Discharge From Employment Act filed briefs claiming that it

provided great new rights for discharged workers. Not true.

Each of the elements listed above was established by this

Court in decisions heretofore made and each was fully

available to wrongfully discharged. employees, including

probationers. Thus, the first element was recognized in

Kenneally v. Orgain (1979), 186 Mont. 1, 606 P.2d 127, where

we said:

... It is only when a public policy is violated

in connection with the wrongful discharge that the

cause of action arises. Examples given by the

courts are: refusal to perjure himself in the case

of one employee; firing of another employee for

asserting a right to obtain Workers' Compensation

benefits to which he was statutorily entitled.; and

refusal of sexual relations.

- 186 Mont. at 6, 606 P.2d at 129.

Id.,

As to the second element, where the discharge of the

employee was not for good cause, we had protected the

employee in cases before the adoption of this Act. In

Ameline v. Pack and Company (1971), 127 Mont. 301, 45 P.2d

689, this Court found that the employer had not established

good cause in the termination of an employee before the end

of his one-year contract. Our recent cases of Prout v. Sears

Roe Buck and Co., (No. 88-117, Mont. Decided February 16,

1989), 772 P.2d 288, 46 St.Rep. 257, and Hobbs v. Pacific

~ide and Fur (No. 84-437, Mont. ~ecidedMarch 31, 1989), 771

P.2d 125, 46 St.Rep. 544, confirmed that a discharge must be

for good cause after the probationary period has elapsed.

These and other cases relied on the implied covenant of good

faith and fair dealing.

The third element for which wrongful discharge is

granted under the Act is if the employer violates the express

provisions of its own written personnel policy. Here again,

the legislature granted nothing that had not already been

firmly established in our decisions. In Dare v. Montana

Petroleum Marketing Company (1984), 212 Mont. 274, 687 P.2d

1015 (Weber, J.) , we held that even an employment handbook

promulgated by the employer was not essential for a cause of

action for a breach of the implied covenant of good faith and

fair dealing stating that:

... [A]n employee is protected from bad faith or

unfair treatment by the employer to which the

employee may be subject due to the inherent

inequality of bargaining power present in many

employment relationships.. . .

- 668 P.2d at 1020, 212 Mont. at 282.

Id.,

violation of the employer's handbook procedures for

termination which gave rise to a wrongful discharge action

was firmly established in Gates v. ~ i f e Montana Insurance

of

Company (1982), 196 Mont. 178, 638 P.2d 1063, and Gates v.

Life of Montana Insurance Company (1983), 205 Mont. 304, 668

P.2d 213. We followed that rule in Stark v. Circle K

Corporation (1988), - Mont . -, 751 P.2d 162; and Kerr v.

Gibson's Products Company of Bozeman (19871, - Mont . I

733 P.2d 1292 (Turnage, J . ; ~laniganv. prudential savings

and Loan ~ssociation (1986), 221 Mont. 419, 720 P.2d 257;

Krenshaw v. Bozeman Deaconess ~ospital (1984), 213 Mont. 488,

693 P.2d 487;

The elements of wrongful discharge, as found in the Act,

therefore, are but restatements of cases based on some

judicial policy heretofore promulgated by this Court. While

perforce, the legislature had to recognize at least those

three elements of wrongful discharge, it took care to provide

that - significant amount of damages could - recovered by -

no be a

wrongfully discharged employee even under those elements. A

wronged employee's remedies are nearly emasculated under the

Act.

Section 5 of the Act [ S 39-2-905, MCA] describes the

recoverable remedies for a wrongfully discharged employee.

He or she may recover no more than four years of lost wages

and fringe benefits - -both of which are deducted amounts

from -

the employees earned or could have earned with reasonable

diligence during that period. Since Section 6 of the Act [ S

39-2-911, MCA] limits suits to one year from the date of

discharge, the employee's loss is wholly speculative.

Section 5 of the Act completely wipes out any right of

any discharged employee to damages for pain and suffering,

emotional distress, compensatory damages or any other form of

damages except the four years of mitigated lost wages and

fringe benefits. These stricken elements of damages are

traditionally allowed against tortfeasors, elements which we

have supported in any number of cases, as proper items of

recovery.

Finally, to make certain that a wronged employee would

have to take his or her lumps without a legal basis for

proper recovery, the legislature adopted Section 8 [ S

39-2-913, MCA] which states that no claim for discharge may

arise from a tort or express or implied contract except as

provided in the Act itself. The real purpose of Section 8 is

to negate by elimination any possible employee claim of tort

based upon an implied covenant of good faith and fair dealing

in the employment contract. This provision takes Montana out

of the mainstream of American legal thought.

Restatement (Second) of Contracts, 205, provides:

Duty of good faith - - dealing.

and fair Every

contract Imposes upon each party a duty of good

faith and fair dealing in its performance and its

enforcement.

The duty of "good faith" is incorporated in the Uniform

Commercial Code [ S 30-1-201(19); S 30-1-208, MCAI. A large

and important body of oil and gas law is based upon implied

covenants contained in oil and gas leases and other

instruments. This Court has recognized that an implied

covenant of good faith and fair dealing attends insurance

policies. First security Bank of Bozeman v. Goddard (1979),

181 Mont. 407, 593 P.2d 1040; State ex rel. Larson v.

~istrict Court (1967), 149 Mont. 131, 136, 423 P.2d 598, 600.

We have also found a remedy for the breach of the implied

covenant in the employment cases noted above, in Dare v.

Montana Petroleum Marketing Company (19841, 212 Mont. 274,

687 P.2d 1015; in the attorney-client relationship, Morsen v.

. ,

Espeland (1985), - Mont - 696 P.2d 428; and in the

dealings by banks with their customers, ribb by v.

Northwestern Bank of Great Falls (1985), - Mont. - 704 ,

P.2d 409; First ~ationalBank in ~ i b b yv. Twombly (1984), 213

Mont. 66, 689 P.2d 1226. We found an implied covenant of

good faith and fair dealing in real property lease agreements

in ~icholsonv. United pacific Insurance Company (1985), -

Mont . - 710 P.2d 1342.

,

The implied element of "good faith" connotes a moral

quality "honesty of person, freedom from fraudulent intent,

and faithfulness to duty or obligation." Raab v. Casper

(1975), 124 Cal.Rptr. 590, 51 Cal.3d 866; Restatement

(Second) of Contracts, S 205.

The nature and extent of an implied covenant of good

faith and fair dealing is measured in any particular contract

by the justifiable expectations of the parties to the

contract. Nicholson, supra.

The approval by this Court in this case of the

elimination by the legislature of the element of good faith

and fair dealing in employment contracts has the effect of

reversing all of the employment cases this Court has handed

down in the last decade. The elimination has a profound

effect on the recovery of punitive damages. Although the Act

here in question provides [Section 5 ( 2 ) 1 for punitive damages

in case of actual fraud or actual malice on the part of the

employer, unless an employee can show an implied covenant of

good faith and fair dealing in his employment contract, he

will find no basis upon which punitive damages can be awarded

to him.

The legislature, in effect, has converted the tort of

wrongful discharge into a sort of contract action by the

adoption of the Wrongful isc charge From Employment Act. The

legislature refused, nonetheless, to provide all the elements

of the damages allowable for breach of contract which

ordinarily would compensate the party aggrieved for all of

the detriment proximately caused by the breach and in the

ordinary course of things likely to result therefrom.

Section 27-1-311, MCA.

In a recent case, the Supreme Court of Nevada in K-Mart

Corporation v. Ponsock (Nev. 1987), 732 P.2d 1364, found the

implied covenant of good faith and fair dealing in the

employment contract, and stated that even contract damages

were inadequate in this type of case. The Nevada Court said:

In this case we have a contract in which the

relationship with the parties is in many ways

analogous to those present in an insurance

contract. Ponsock was just as dependent in

"specially relying" on K-Mart's commitment to his

extended employment and subsequent retirement

benefits as is an insurance policyholder dependent

on the good faith indemnity promised by the

insurance carrier. The special relationships of

trust between this employer and this employee under

this contract under this kind of abusive and

arbitrary dismissal cries out for relief and for a

-

remedy beyond that traditionally flowing from

breach of contract. To permit only contract

damages as the sole remedy for this kind of conduct

would be to render K-Mart totally unaccountable for

these kinds of actions. If all a large corporate

employer had to do was to pay contract damages for

this kind of conduct, it would allow and even

encourage dismissals of employees on the eve of

retirement with virtual impunity. ~ a v i n g to pay

only contract damages would offer little or no

determent to the types of practice apparently

engaged in by K-Mart In this case. Further, an

aggrieved employee, relying on, and anxiously

awaiting his retirement benefits would not be made

whole by an award of contract damages resulting

from wrongful discharge, even if he were awarded

the expected retirement benefit ... After

involving itself in a relationship of trust and

special reliance between itself and its employee

and allowing the employee to rely and depend upon

continued employment and retirement benefits, the

company, to serve its own financial ends,

wrongfully and in bad faith breached the employment

agreement. The jury specifically found this

reliance and concluded that K-Mart was guilty of

bad faith . .. (Emphasis in original.)

Id.,732 P.2d at 1372.

-

It is evident that the Wrongful isc charge From

Employment Act adopted by the Montana legislature purporting

to give a wronged employee some rights, instead, took away

any possible right of meaningful recovery. The ominous

implications of this Act for all employees not working under

a union contract cannot be overstated. The longer the

employee works for an employer, the greater reliance the

employee places upon the employer's proffer of fringe

benefits and retirement allowances, then the more the

employee is at risk to be discharged, because the economic

result of a wrongful discharge to the employer, even if the

employee's suit under the Act should be successful, is

nothing but paltry damages to the employee and possible

profit to the employer. The lack of legislative clout of the

unorganized workers, although they may comprise a majority of

the workers in this state, is demonstrated in that this

patently unfair legislation in 1987 passed the State Senate

without a no vote on third reading, and with but 16 no votes

out of 100 in the State House of Representatives.

When law can do no right

[Then] it be lawful that law can bar no wrong.

-~illiam Shakespeare, ~ i n q John (Magna ~arta's

John) Act 111, Scene i.

Four centuries ago ~illiamShakespeare stated in capsule

the view of the majority of this Court in upholding the Act.

The majority view is that the legislature can abolish any

right of recovery and when it does courts are barred from

awarding "full legal redress" under Art. 11, Sec. 16, Montana

State Constitution. So holding, the majority airily overrule

Pfost v. State (1986), 219 Mont. 206, 713 P.2d 494; white v.

State (1983), 203 Mont. 363, 661 P.2d 1272 and orr rig an v.

Janney (1981), - Mont . - 626 P.2d 838. We submit that

,

not only are these reversals overbroad, but they are clearly

in error.

First let us examine the overruled cases. Corrigan - v.

Janney, supra, involved an appeal from a summary judgment

granted in the District Court against a plaintiff in a

wrongful death case. Janneys had leased living quarters to

the Corrigans, and the leased premises were defectively wired

so that Max Corrigan came in contact with the faucet on a

bathtub and received an electrical shock which ultimately

caused his death. The District Court, reading earlier cases

of this Court, decided that there was no cause of action by a

tenant against the landlord for such a defect and granted

summary judgment. his Court held (~arrison, J.) that there

is in modern day usage a need for rental houses to be

suitable for human occupation and that a cause of action for

wrongful death in this case did exist. The Court cited Art.

11, Sec. 16 of the Constitution and went on to state:

It would be patently unconstitutional to deny a

tenant all the causes of action for personal

injuries or wrongful death arising out of the

alleged negligent management of rental premises by

a landlord. If this action were to be taken away,

a substitute remedy would have to be provided.

Arguably, the repair and deduct statute provides an

alternative remedy for damage to the leasehold

interest. However, in no way can it be considered

an alternative remedy for damages caused by

personal injury or a wrongful death. (Emphasis

supplied.)

- 626 P.2d at 840.

Id.,

Justice Harrison then noted a controlling statute and

went on to state:

In summary, we overrule Dier v. Mueller, supra, and

hold that our Constitution requires that plaintiff

have a form of redress for wrongful death and

survivor damages. We hold that 5 58-607 R.C.M.

(1947), is controlling and that one is responsible

for injury occasioned to another by want of

ordinary care subject to the defenses and

contributory negligence or assumption of risk.

Id., 626 P.2d at 841.

-

Thus Corrigan held that S 58-607 provided a statutory

basis for recovery in this wrongful death case, and that Art.

11, Sec. 16 constitutionally guaranteed the right of redress

in that case. Why the majority overrules that case is beyond

my conjecture.

In White - State, supra, Karla white sued the State of

v.

Montana alleging that the State was grossly negligent in

permitting an allegedly violent and dangerous person to

escape from the mental hospital at Warm springs and to remain

free for a period of 5 years without serious attempts to

locate and reincarcerate the escaper. Karla was brutally

attacked by this individual about 5 years after he had

escaped from Warm springs.

The legislature meanwhile had passed S 2-9-104, MCA,

which provided that any governmental unit, including the

State, was not liable for noneconomic damages, nor for any

economic damages in excess of $300,000 for any one claimant.

If this statute were upheld, Karla's right of recovery,

premised upon severe emotional injuries which she received

from the attack but insignificant economic damages, would be

effectively wiped out. The District Court held that the

statutory limitation on governmental liability for damages

was unconstitutional and granted summary judgment in favor of

Karla. The State appealed to this Court, which said:

Article 11, Section 16 of the Montana Constitution

guarantees that all persons shall have a "speedy

remedy ... for every injury of person, property,

or character. " In Corrigan v. Janney (1981),

Montana, 626 P.2d 838, this Court held that it is

"patently unconstitutional" for the legislature to

pass a statute which denies a certain class of

Montana Citizens their causes of action for

personal injury and wrongful death. We affirm and

redefine our holding in Corrigan v. Janney, supra;

we hold that the Montana Constitution guarantees

that all persons have a speedy remedy for every

injury. The language "every injury" embraces all

recognized cornpensable components of injury

including the right to be compensated for physlcal

7 -

pain - mental angulsh - - -loss of enjoyment

and and the -

of llvlng.

- hes sf ore, strict scrutiny attaches.

(Emphasis supplied.)

Id., 661 P.2d at 1275.

-

In white, this Court found no compelling state interest

to classify tortfeasor victims on whether they had been

injured by a nongovernment tortfeasor or by a government

tortfeasor. The Court struck down a statute which allowed

recovery to plaintiffs damaged economically up to $300,000,

but totally denied recovery for noneconomic damages; and

further, the statute classified victims of government

tortfeasors by the severity of the victim's injuries.

It should be clear to all that 5 2-9-104, MCA, denied

the equal protection of the law to white because the statute

discriminated between tortfeasors injured by government

agents or by private defendants; and as between persons

injured by government tortfeasors, it discriminated on the

basis of economic and noneconomic damages. Certainly this

Court in white enforced the state constitutional mandate to

courts that "Right and justice shall be administered

without ... denial . . ."

Art. 11, Sec. 16.

Before adverting to Pfost 1 State, supra, we set out

.

for the convenience of the reader the full text of Art. 11,

Sec. 16, of the State Constitution:

Courts of justice shall be open to every person,

and speedy remedy afforded for every injury of

person, property, or character. No person shall be

deprived of this full a redress for injury

incurred in employment for which another person may

be liable except as to fellow employees and his

immediate employer who hired him if such immediate

employer provides coverage under Workmens'

Compensation Laws of this state. Right and justice

shall be administered without sale, denial, or

delay. (Emphasis added. )

Pfost - State involved a plaintiff who had been injured

v.

when his truck-tractor collided with a bridge on an extremely

icy and hazardous highway. He alleged no precautions had

been taken by the State to remedy the hazardous condition

although three separate wrecks had occurred prior to Pfost's

arrival. Pfost suffered injuries which eventually made him a

quadriplegic. He sought compensatory damages of 6 million

dollars. In the meantime, the legislature had adopted a new

statute regarding the liability of the State in tort cases,

limiting any or all recovery to $300,000 for a single person.

Section 2-9-107, MCA. Pfost's medical expenses alone

exceeded that sum. The District Court held the statute to be

unconstitutional as a denial of equal protection and the

State appealed. In Pfost, we followed White - State, supra,

v.

holding that Art. 11, Sec. 16, 1972 of Montana constitution,

granted a fundamental right to access to courts for a full

legal redress and on the basis of equal protection found that

S 2-9-107, MCA, discriminated improperly between those with

minor injuries and those with catastrophic injuries resulting

from the tort of a government agent. In passing on the

language of Art. 11, Sec. 16, supra, we stated:

The use of the clause "this full legal redress" has

major significance. It obviously and grammatically

refers to the "speedy remedy afforded for every

injury of person, property, or character." The

adjective "this" means the person, thing, or idea

that is present or near in place, time, or thought

or that has just been mentioned. Websters New

Collegiate ~ictionary (1981). The constitutional

framers thus construed a "speedy remedy" as

comprehending "full legal redress." A state

constitutional right to full legal redress was

thereby created. Any state statute that restricts,

limits, or modifies full legal redress for injury

to person, property, or character therefore affects

a fundamental right and the State must show a

compelling state interest if it is to sustain the

constitutional validity of the statute.

Pfost, 713 P.2d at 503.

The majority object to our grammatical interpretation in

Pfost of Art. 11, Sec. 16, as "flawed." Perhaps the majority

have rules of grammar of which this writer is unaware, but we

will leave it to the teachers of English that the clause

"this full legal redress" refers in Art. 11, Sec. 16 to the

"speedy remedy afforded for every injury of a person,

property, or character." Grammatically, we insist that

"speedy remedy" comprehended "full legal redress."

Speaking in the vein of grammatical construction, the

majority ask us to construe the term "full legal redress" in

the second sentence of Art. 11, Sec. 16 as applying only to

injured workmen who have claims against third parties for

their injuries. The majority contend that the purpose of the

inclusion of the second sentence was only to protect injured

workmen and had no effect on the remainder of Art. 11, Sec.

16. In this sense, the majority grammatically misconstrue

the article. Under its plain language the right of "full

legal redress" is not given only to Workers' Compensation

claimants. Rather, the right of "full legal redress" is

emphatically granted to Workers' Compensation claimants too.

The framers intended to make certain that included in Art.

11, Sec. 16 was a specific provision which also extended the

speedy remedy comprehending full legal redress to Workers'

Compensation claimants who might have separate causes of

action against third parties, not their employers or fellow

employees.

Ashcraft v. The Montana Power Company (1971), 156 Mont.

368, 480 P.2d 812 was the reason for the insertion by the

framers of the second sentence in Art. 11, Sec. 16, to make

certain that Workers' Compensation claimants had the right of

full legal redress, too. Ashcraft was a laborer working for

a construction company which as an independent contractor was

performing work on the job for the general employer, Montana

Power Company. Ashcraft was injured through the alleged

negligence of the Montana Power Company. He recovered

Workers' Compensation benefits through his employer, and

sought to sue Montana Power Company as a third party

tortfeasor. This Court held that Ashcraft had no cause of

action for his injuries against the third party tortfeasor,

Montana Power Company. Ashcraft and several cases of its

progeny following, were at the forefront when Art. 11, Sec.

16 was considered by the constitutional framers in 1972. The

second sentence of Art. 11, Sec. 16 was inserted specifically

to overrule Ashcraft.

When the provisions of Art. 11, Sec. 16 came before the

Constitutional convention for eventual adoption, Delegate

Habedank, as indicated in the majority opinion, made a motion

to strike the second sentence of the section upon the grounds

that the sentence was merely legislative, and its subject was

better left to the legislature. Delegate Habedank's

amendment to delete the second sentence was defeated in the

convention, but before the amendment was submitted to a vote,

Delegate Habedank made a comment that is interesting in light

of this case:

DELEGATE HABEDANK: Yes, Mr. president [Chairman]

you have had the matter very fairly presented to

- -

you by Mr. Dahood. As I told you in the first

place, I do not particularly oppose this particular

amendment, but I have been told that we lawyers are

writing the Constitution, trying to slip matters

into this Constitution for our own personal gain.

You have had the pro of the con given to you. This

is somethinq that can't be corrected by the

legislature. - - - - - in your power - - -

You have it to be the

supreme Legislature, as the committee has requested

you to do. I leave it to you, but I do think that

when you do it, you should do it knowing what you

do and not accuse the lawyers of pulling the wool

over your eyes. (Emphasis supplied.)

verbatim h ran script, page 1758.

Even more interesting in connection with the

Constitutional Convention is that the author of the majority

opinion here, a respected member of the Constitutional

Convention, stood and opposed Delegate Habedank's motion to

delete the second sentence of Art. 11, Sec. 16. He stated:

DELEGATE McDONOUGH: Mr. Chairman, I also support

the committee's proposal. In Eastern Montana

there's a lot of accidents in the oil field, and

practically all the work is subcontracted out or

contracted out, and we never dreamed--and Mr.

Habedank, I am sure, admits himself he never

dreamed, because he's defended these law

suits--that the Supreme Court would rule in this

manner. And I support the committee proposal

because it just--it was a very bad law and it

should be restored.

verbatim rans script, pages 1757, 1758.

There is an inconsistency between the statements of

Delegate McDonough in support of Art. 11, Sec. 16, and the

his statements as the author of the majority opinion as

expressed today. If, as he now espouses, Art. 11, Sec. 16

gives only a right of access to the courts, but not to a full

legal redress, the legislature could make the second sentence

of Art. 11, Sec. 16, meaningless by simply abolishing the

remedies available to third party plaintiffs as they have

abolished the tort remedies of the employees in this case.

Such a view was unexpressed by any delegate to the

Convention. In the light of his opinion today, the

commendable efforts of Delegate McDonough to support Art. 11,

Sec. 16 were not worth the candle. The injured workman now

has no more guaranty of a legislature allowing full legal

redress than the merest employee relying on implied

covenants.

The fundamental right to remedy was expressed to the

Constitutional Convention by the chairman of the sill of

Rights Committee, supporting Art. 11, Sec. 18 (governmental

immunity) when he said:

We submit it's an inalienable right to have remedy

when someone injures you through negligence and

through wrongdoing, regardless of whether he has

the status of a governmental servant or not.

(Emphasis added.)

(See No11 and Kenneady v. Bozeman (1975), 166 Mont. 504, 507,

534 P. 2d 880, 882) . The Jeffersonian word "inalienable"

means incapable of being surrendered or transferred.

[Webster's New Collegiate ~ictionary (198l)l.

Now let us state exactly what Corrigan, white, and Pfost

stood for. ~orriqanestablished that when a cause of action

is grounded on statute the right of a plaintiff to a full

legal redress under that statute was fundamental. White and

Pfost established that when a statute discriminated

invidiously between injured plaintiffs, the courts under Art.

11, Sec. 16 would apply exacting scrutiny to determine the

necessity, if any, for the discrimination. Those results

were commanded by the language of Art. 11, Sec. 16.

A major premise of the majority opinion is that Art. 11,

Sec. 16 is addressed to the courts, and because the section

is not addressed to the legislature, the legislature is free

to act without restraint except for a minimal rational test.

That concept ignores the last sentence of Art. 11, Sec. 16,

which tells the courts that "right and justice shall be

administered without denial.'' The courts must consider first

the right and then justice, and neither must be denied.

A full legal remedy, state the majority, is not a

fundamental right; and so bring themselves to deny the

essence of a fundamental right. The right of a citizen to

claim justice from his state, is, we should agree, a

fundamental right; else the right of petition for redress

from grievances is meaningless. State protection of citizens

from injustice, - fortiori, is also a fundamental right; else

a

the right of petition is toothless.

A legal remedy that delivers only 25% justice

automatically also delivers 75% injustice. Assuming a

wrong-doing employer, a legal remedy that delivers to the

long-term employee only four working years of justice

delivers also the balance of a working lifetime of injustice.

For justice is not divisible. Either the result is just or

it is unjust, just as a single fact is true or else it is

untrue. There is no middle to justice, for injustice takes

up where partial justice ends. In defining justice, we do

not mess with Mr. In-Between. As surely as there are

fundamental rights, there are surely no fundamental

half-rights. The right of access to courts is only part of

the fundamental right; the right to a full legal remedy

completes the part to make a whole. The two, access to the

courts and full redress, indivisibly make one fundamental

right, and together they are the essence of justice. They

must coexist to complete the fundamental right to justice.

The least plausible argument of the majority in this

case is that the legislature has the power to limit remedies,

and that this Court may not interfere if the legislature so

acts. If this were true in all cases, the public in this

state would have no protection from free-wheeling

legislatures. Fortunately, if the Court does its job, our

state constitutional system is designed to contain

legislative action within constitutional limits. That design

requires the state courts to rein in a rampant legislature.

specially must an appellate court (in Montana the only

appellate court is this Court) be watchful to safeguard the

rights of the public in state constitutional disputes.

Our appellate jurisdiction has a two-fold

purpose: First, we assure state litigants that the decision

makers at the first level, the district courts, will make

correct decisions, not in isolation, but with the connected

support of the state legal system. The review for

correctness reinforces the dignity and acceptability of the

trial court's decisions, and controls any adverse effects of

shortcomings at the first level. The second purpose of this

appellate court is equally important. Our institutional

review of the workings of trial courts serves to announce,

clarify and harmonize the rules of decision and the

application of laws in the state legal system. Necessarily,

institutional review is both creative and political; to say

that legislatures, and not courts, make law ignores the facts

of appellate life.

The final arbiter of what the state law in Montana shall

be is this Court, under Art. 11, Sec. 16, not the

legislature. We are given that power, to be used judicially.

The Justices in the majority do not seem to realize it, but

in approving without objection or by inaction the Wrongful

Discharge From Employment Act of 1987, they are making law.

They have blessed what should be repugnant to a court--a

savage curtailment of redress for wrongs, and they excuse

their inaction by ceding overall power to the legislature.

Though the State Constitution requires courts of justice (not

the legislature) to afford a speedy remedy for every injury

of person, of property, or of character, the majority have

taken a detour from the road to remedy. They have declined

to insist on not only a speedy remedy, but on full legal

redress for wrongfully discharged employees. They have made

law by being passive, and deserve no praise. A toothless

court, when abstaining from its duty, is making law and is as

great a threat to a just government as an unrestrained

legislature.

This is not to say that this Court sits as a super

legislature, governing by its discretion the policy, wisdom,

and direction of legislative acts. When, however, the

legislature acts invidiously to discriminate between persons

similarly situated, as will be demonstrated below, Art. 11,

Sec. 16 imposes a duty upon this Court to make certain that

right and justice are not denied.

111.

Having determined that Meech has no fundamental right to

a full legal redress here, the majority sustain the equal

protection implications of the Wrongful Discharge From

Employment Act by applying the rational test. This leads the

majority to the irrational result that it is rational to make

the state safe for unscrupulous employers.

The legislature made no findings to accompany the Act,

nor does the Act itself articulate its purpose. The

statements by the majority as to the purpose of the Act are

extrapolated from written statements of proponents submitted

to the committees considering the Act, and not the whole

legislature.

At its core, the Wrongful l is charge From Employment Act

is nothing more than a cap on recoverable damages available

to wronged employees. In that sense, the type of law we are

looking at here is no different than the types presented to

us in White and Pfost, supra.

To begin with, the at-will statute which formerly

governed employee relationships in Montana is not really

repealed in the Act. The same language as existed in S

39-2-504, MCA, is included in S 2 of the Act. At-will

employees still exist in Montana.

We should also put out of the way any argument that the

Act discriminates with respect to punitive damages to the

extent that they are allowed under the Act. The test of

punitive damages in 5(2) of the Act is the same test faced

by any plaintiff claiming punitive damages under S 27-1-221,

MCA.

The Wrongful Discharge From Employment Act cannot be

sustained as an equal protection under the rational basis

test because it discriminates adversely between persons

similarly situated and it discriminates vertically as well as

horizontally.

Equal protection permits reasonable classifications only

if those similarly situated in relevant respects are treated

similarly. An Act is excessively underinclusive if it

excludes persons who are similarly situated.

The majority opinion does not begin to state the number

of ways in which employees similarly situated are

discriminated against under the Wrongful Discharge From

Employment Act. Horizontally, the discriminations include at

least these:

1. A union worker is not affected by the Act; only

non-union workers are covered. Thus a union worker who is

discharged for "whistle blowing1' has larger rights of

recovery than a non-union worker discharged for the same

reason.

2. Workers whose discharge is the result of a violation

of the Human ~ i g h t sAct, the Equal Employment Opportunity

Act, the Pension Reform Act of 1974 (ERISA), the Pregnancy

Disability Act and any number of other state or federal acts

are not covered under the Wrongful isc charge From Employment

Act. Such employees' full rights of recovery are not taken

away under this Act (see for example, ~rinkwalterv. shipton

Supply Company, Inc. (1987 , - Mont. - 732 P.2d 1335;

,

Breese v. Steel Mountain ~nterprises,Inc. (1986), 220 Mont.

454, 716 P.2d 214; and Strong v. State (19791, 183 Mont. 410,

600 P.2d 191.

3. The Act discriminates against long term employees by

severely limiting their damages which might be large in

magnitude. See ~lanigan v. prudential Federal savings and

Loan (1986), 221 Mont. 419, 720 P.2d 257.

4. A worker on probation is entirely precluded from any

action for wrongful discharge.

In addition, the Act is vertically discriminatory in

that it imposes upon wrongfully discharged employees the

burden of subsidizing a better business climate for

wrongdoing employers.

It is not a legitimate state purpose to protect

employers from their unscrupulous acts as against the

traditional rights of individuals to earn their livelihood.

Our state constitution includes among inalienable rights

"pursuing life's basic necessities, enjoying and defending

their lives and liberties, acquiring, possessing and

protecting property, and seeking their safety, health and

happiness in all lawful ways. In enjoying these rights, all

persons recognize corresponding responsibilities." Art. 11,

§ 3, 1972 Mont. Const.

Thus, no case can be made on a rational basis to sustain

a law the principal purpose of which is to subsidize, protect

or enhance the acts of wrongdoers.

Because of its manifest discrimination, because it

serves no legitimate state purpose, and because it cannot

survive a proper balancing test as between the rights of

employers and of individuals to pursue life's basic

necessities, the Wrongful Discharge From Employment Act of

1987 violates the Equal protection Clause of the 1972 Montana

Constitution, Art. 11, S 4.

As stated in Richardson v. ~arnegie~ibraryRestaurant,

Inc. (NM 1988), 763 P.2d 1153:

We commence our examination by repeating that the

court of appeals erred in its equal protection

analysis of the damage limitation. A legislative

classification not only must affect equally a11

persons within the class to which the legislation

applies but, to begin with, the legislature must

have a legitimate purpose for creating the class,

and a constitutionally permissible reason for

treating persons within that class differently from

those without. See McLaughlin v. ~lorida, 379 U.S.

Id., 763 P.2d at 1164.

-

IV.

Generally, when a legislative act is invalid because of

a discrimination, the act also violates other provisions of

the state constitution. That is true in this case. The

majority dismisses without proper discussion the due process

implications of the Wrongful Discharge From Employment Act.

It is usually a due process argument that an Act which

limits the rights of recovery of injured parties must provide

-

a reasonably adequate substitute, or quid pro ~ u o ,as the

majority calls it. The majority, having adopted the

irrational conclusion that the Wrongful Discharge From

Employment Act was valid, is driven to a further

irrationality in determining that the substitution of

mitigated recovery provided to wronged employees in the Act

was adequate. Not unlike Polonious in Hamlet, the majority

can find in a cloud a camel's shape, a weasel's, or very like

a whale.

In determining the adequacy of the substituted recovery

in the Act, the majority confined itself to examination of

the mitigated four years of damages as against what might be

recovered for loss of wages or fringe benefits. The majority

paid no attention in determining adequacy to the elimination

of compensatory damages, damages for emotional or mental

distress, and damages arising from the breach of the implied

covenant of good faith and fair dealing. By so examining,

the majority managed to escape the best indication of the

inadequacy of the recoverable damages in the Act demonstrated

by the cases that have come to this Court. The results in

such cases as ~laniqan,supra, Stronq - - supra, and

v. State,

Stark v. The circle K Corporation ( 1 9 8 8 ) , 7 5 1 P.2d 162, show

the injury done by the Act to plaintiffs through the

elimination of common law tort remedies. The Act simply does

not survive an adequacy test when properly admeasured against

the former law in Montana.

Other constitutional provisions probably affected by the

majority decision but not referred to by the majority opinion

and thus not pertinent to this dissent are the right to trial

by jury, and the privilege and immunity clauses of the state

constitution. Art. 11, S 26; Art. 11, S 31, 1972 Mont.

Const. Oregon looks to Art. I, S 20 of its constitutional

privileges and ~rnmunities Clause rather than to equal

protection tests to determine the validity of a statute.

There the court inquires into whether the challenged statute

affects a "privilege or immunityw--that is, "some advantage"

to which a person "would be entitled but for a choice made by

government authority." Salem v. Bruner (Ore. 1985), 702 P.2d

70, 74. In a recent case in washington, sophie v. ireb board

corporation (Wash. 1989), 771 P.2d 711, the Supreme Court of

that state found, because of the language in washington's

Tort Reform Act, a violation of the state constitutional

provision of the right to trial by jury. Arguments with

respect to similar clauses in our state constitution could be

made in this case, but were not raised in briefs nor decided

by the majority. They are therefore open to future

discussions.

v.

If Art. 11, 16 of the Montana Constitution does

anything, it imposes upon the judiciary the duty to guard the

state constitution. In its decision today, this Court

sidesteps that duty and reverses not only the cases mentioned

in the majority opinion but a long line of cases in the past

15 years that have established solid boundaries for employers

and employees, while adhering to the at-will principle

declared in our statutes. In yielding our duty to the

vagaries of the legislature, we have disadvantaged a large

portion of the Montana labor market in the guise of a better

business climate. The Wrongful Discharge From Employment Act

of 1987 is economically and socially regressive. The

majority opinion is legally regressive. Because of the

unwillingness of the majority to act properly in a

constitutional case, regressiveness is the order of the day.

I would hold the Wrongful isc charge From Employment Act

of 1987 to be invalid on the basis that under an equal

protection test it cannot meet even a rational scrutiny. The

only basis for the Act that I can find is that as between

business and the workers, the legislature discriminatingly

prefers business. That is not a constitutional basis on

which to found a statute.

-\

'

.'

i,

I concur in the dissent of Mr. Justice John C. Sheehy.

/

EXHIBIT A

CHAPTER NO. 641

AN ACT PROVIDING A PROCEDURE AND REMEDIES FOR

WRONGFUL DISCHARGE; AUTHORIZING ARBITRATION AS AN

ALTERNATIVE; ELIMINATING COMMON-LAW REMEDIES;

REPEALING SECTIONS 39-2-504 AND 39-2-505, MCA; AND

PROVIDING AN APPLICABILITY CLAUSE AND AN EFFECTIVE

DATE.

Be in enacted by the ~egislature of the State of

Montana:

section 1. Short title. [Sections 1 through

91 may be cited as the "Wrongful isc charge From

Employment Act". [5 39-2-9011

Section 2. Purpose. [Sections 1 through 91

set forth certain rights and remedies with respect

to wrongful discharge. Except as limited in

[sections 1 through 91, employment having no

specified term may be terminated at the will of

either the employer or the employee on notice to

the other for any reason considered sufficient by

the terminating party. Except as provided in

[section 7 1 , [sections 1 through 91 provide the

exclusive remedy for a wrongful discharge from

employment. [ S 39-2-9021

Section 3. ~efinitions. In [sections 1

through 91, the following definitions apply:

(1) "Constructive discharge" means the

voluntary termination of employment by an employee

because of a situation created by an act or

omission of the employer which an objective,

reasonable person would find so intolerable that

voluntary termination is the only reasonable

alternative. Constructive discharge does not mean

voluntary termination because of an employer's

refusal to promote the employee or improve wages,

responsibilities, or other terms and conditions of

employment.

(2) isch charge" includes a constructive

discharge as defined in subsection (1) and any

other termination of employment, including

resignation, elimination of the job, layoff for

lack of work, failure to recall or rehire, and any

other cutback in the number of employees for a

legitimate business reason.

(3) "Employee" means a person who works for

another for hire. The term does not include a

person who is an independent contractor.

(4) "~ringebenefits" means the value of any

employer-paid vacation leave, sick leave, medical

insurance plan, disability insurance plan, life

insurance plan, and pension benefit plan in force

on the date of the termination.

(5) "Good cause" means reasonable,

job-related grounds for dismissal based on a

failure to satisfactorily perform job duties,

disruption of the employer's operation, or other

legitimate business reason.

(6) "Lost wages" means the gross amount of

wages that would have been reported to the internal

revenue service as gross income on Form W-2 and

includes additional compensation deferred at the

option of the employee.

(7) "Public policy" means a policy in effect

at the time of the discharge concerning the public

health, safety, or welfare established by

constitutional provision, statute, or

administrative rule. [ § 39-2-903 (1)- (7), inc. I

Section 4. Elements of wrongful discharge. A

discharge is wrongful only?£:

(1) it was in retaliation for the employee's

refusal to violate public policy or for reporting a

violation of public policy;

(2) the discharge was not for good cause and

the employee had completed the employer's

probationary period of employment; or

( 3 ) the employer violated the express

provisions of its own written personnel policy. [ §

39-2-9041

section 5. ~emedies. (1) If an employer has

committed a wrongful discharge, the employee may be

awarded lost wages and fringe benefits for a period

not to exceed 4 years from the date of discharge,

together with interest thereon. Interim earnings,

including amounts the employee could have earned

with reasonable diligence, must be deducted from

the amount awarded for lost wages.

(2) The employee may recover punitive damages

otherwise allowed by law if it is established by

clear and convincing evidence that the employer

engaged in actual fraud or actual malice in the

discharge of the employee in violation of [ S 4 (1)I .

(3) There is no right under any legal theory

to damages for wrongful discharge under [sections 1

through 91 for pain and suffering, emotional

distress, compensatory damages, punitive damages,

or any other form of damages, except as provided

for in subsections (1) and (2). [ S 39-2-9051

Section 6. Limitation of actions. (1) An

action under [sections 1 throuqh 9 1 must be filed

within 1 year after the date of-discharge.

(2) If an employer maintains written internal

procedures, other than those specified in [section 71 , under

which an employee may appeal a discharge within the

organization structure of the employer, the employee shall

first exhaust those procedures prior to filing an action

under [sections 1 through 91 . The employee's failure to

initiate or exhaust available internal procedures is a

defense to an action brought under [sections 1 through 9 . !

If the employer's internal procedures are not completed

within 90 days from the date the employee initiates the

internal procedures, the employee may file an action under

[sections 1 through 91 for purposes of this subsection the

employer's internal procedures are considered exhausted. The

limitation period in subsection ( 1 ) is tolled until the

procedures are exhausted. In no case may the provisions of

the employer's internal procedures extend the limitation

period in subsection (1) more than 120 days.

(3) If the employer maintains written internal

procedures under which an employee may appeal a discharge

within the organizational structure of the employer, the

employer shall within 7 days of the date of the discharge

notify the discharged employee of the existence of such

procedures and shall supply the discharged employee with a

copy of them. If the employer fails to comply with this

subsection, the discharged employee need not comply with

subsection (2) [ S 39-2-9111

Section 7. Exemptions. [sections 1 through 9 do not

apply to a discharge:

(1) that is subject to any other state or federal

statute that provides a procedure or remedy for contesting

the dispute. Such statutes include those that prohibit

discharge for filing complaints, charges, or claims with

administrative bodies or that prohibit unlawful

discrimination based on race, national origin, sex, age,

handicap, creed, religion, political belief, color, marital

status, and other similar grounds.

(2) of an employee covered by a written collective

bargaining agreement or a written contract of employment for

a specific term. [ § 39-2-9121

section 8. preemption - common-law remedies. Except

of

as provided in [sections 1 through 91, no claim for discharge

may arise from tort or express or implied contract [ B

39-2-9131

Section 9. Arbitration. (1) Under a written agreement

of the parties, a dispute that otherwise could be adjudicated

under [sections 1 through 91 may be resolved by final and

binding arbitration as provided in this section.

(2) An offer to arbitrate must be in writing and

contain the following provisions:

(a) A neutral arbitrator must be selected by mutual

agreement or, in the absence of agreement, as provided in

27-5-211.

(b) The arbitration must be governed by the Uniform

Arbitration Act, Title 27, chapter 5. If there is a conflict

between the uniform ~rbitrationAct and [sections 1 through

91 , [sections 1 through 91 apply.

(c) The arbitrator is bound by [sections 1 through 91 .

(3) If a complaint is filed under [sections 1 through

91, the offer to artibrate must be made within 60 days after

service of the complaint and must be accepted in writing

within 30 days after the date the offer is made.

(4) A party who makes a valid offer to arbitrate that

is not accepted by the other party and who prevails in an

action under [sections 1 through 91 is entitled as an element

of costs to reasonable attorney fees incurred subsequent to

the date of the offer.

(5) A discharged employee who makes a valid offer to

arbitrate that is accepted by the employer and who prevails

in such arbitration is entitled to have the arbitrator's fee

and all costs of arbitration paid by the employer.

(6) If a valid offer to arbitrate is made and accepted,

arbitration is the exclusive remedy for the wrongful

discharge dispute and there is no right to bring or continue

a lawsuit under [sections 1 through 81. The arbitrator's

award is final and binding, subject to review of the

arbitrator's decision under the provisions of the Uniform

Arbitration Act. [ S 39-2-9141

Section 10. Repealed. sections 39-2-504 and 39-2-505,

MCA, are repealed.

Section 11. Severability. If a part of this act is

invalid, all valid parts that are severable from the invalid

part remain in effect. If a part of this act is invalid in

one or more of its applications, the part remains in effect

in all valid applications that are severable from the invalid

applications.

Section 12. Applicability. This act applies to claims

arising after the effective date of this act.

Section 13. Effective date. This act is effective July

1, 1987.

Approved May 11, 1987.

Mr. Justice John Conway Harrison, dissenting.

While I agree with much that is said by the majority in

this opinion, the totality of this opinion in reversing so

many cases this Court has previously decided, necessitates my

filing this dissent.

I cannot concur with all that has been said in the

dissent of Mr. Justice John C. Sheehy, yet I find I must

agree with Justice Sheehy regarding Corrigan v. Janey (Mont.

1981), 626 P.2d 838, 38 St.Rep. 545. I feel that it is

totally unnecessary to reverse Corrigan which established

that when a cause of action is grounded on statute the

plaintiff has a fundamental right to full- legal redress under

that statute.