Bruner v. Yellowstone County

No. 95-026

IN THE SUPREME COURT OF THE STATE OF MONTANA

1995

WEND1 BRUNER,

Plaintiff, Appellant,

YELLOWSTONE COUNTY. A BODY

POLITIC, YELLOWSTONE COUNTY ATTORNEY,

DENNIS PAXINOS, SR., MICHAEL S. MATTHEW,

H. ELWOOD ENGLISH, AND ITS FORMER

APPEAL FROM: District Court of the Thirteenth Judicial District,

In and for the County of Yellowstone,

The Honorable William J. Speare, Judge presiding.

COUNSEL OF RECORD:

For Appellant:

A. Clifford Edwards, Roger W. Frickle, Edwards Law

Firm, Billings, Montana

For Respondent:

Carey E. Matovich, Matovich, Addy & Keller,

Billings, Montana

Submitted on Briefs: April 27, 1995

Decided: August 3, 1995

Filed:

Justice Fred J. Weber delivered the Opinion of the Court.

This is an appeal from grant of summary judgment to the

defendants by the Thirteenth Judicial District Court, Yellowstone

county. We affirm.

The following issue is dispositive of the case:

Did the District Court err in granting summary judgment on the

issues of negligent retention and sexual harassment?

Plaintiff, Wendi Bruner was employed as a secretary by the

Yellowstone County Attorney's Office from August of 1991 until she

tendered her resignation on April 8, 1992. In her resignation,

plaintiff claimed that she had been continually sexually harassed

by then Deputy County Attorney David Hoefer.

On April 9, 1992, County Attorney Dennis Paxinos hired a

private investigator to investigate plaintiff's allegations and

pending the investigator's findings, suspended Hoefer with pay.

The investigator concluded that the charges were warranted and

Paxinos then terminated Hoefer without pay on May 19, 1992.

In its Memorandum and Order, the District Court pointed out

that Hoefer began grievance procedures against the County and on

May 22, 1992, the Board of County Commissioners conducted a

preliminary hearing and on that date negotiated a compromise

settlement with Hoefer. On June 1, 1992, Hoefer executed a release

and settlement agreement with the County which provided that Hoefer

tendered his voluntary resignation effective May 19, 1992 and

released any and all claims between Yellowstone County and himself

in return for $30,000 in settlement. While the $30,000 settlement

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was reported in the media, the settlement agreement contained a

confidentiality clause and terms were not released to the public

until after the County officials were compelled to release the

documents.

On September I, 1993, plaintiff filed a complaint with the

Equal Employment Opportunity Commission, which rejected the claim

as untimely, but issued a right to sue letter. On the same date

the plaintiff filed a complaint of sexual harassment with the

Montana Human Rights Commission (MHRC). In January, 1994, MHRC

considered the length of delay in filing, but concluded that the

statute of limitations was tolled on an equitable estoppel theory

and that plaintiff's claim was timely made, MHRC dismissed the

plaintiff's complaint without prejudice but did not issue a right

to sue letter.

On April 1, 1994, plaintiff filed her First Amended Complaint

in Yellowstone County District Court charging the defendants with

negligent retention and sexual harassment and charging Hoefer with

battery as well. Following two motions for summary judgment, the

District Court held a hearing and thereafter issued its order on

November 25, 1994, granting summary judgment to the defendants on

all counts. Plaintiff appeals this order.

Standard of Review

The standard of review for a grant of summary judgment is well

settled in Montana. This Court will apply the same evaluation as

the district court based upon Rule 56, M.R.Civ.P. The movant must

demonstrate that no genuine issues of material fact exist. Toombs

3

v. Getter Trucking, Inc. (1993), 256 Mont. 282, 846 P.Zd 265. Once

this has been accomplished, the burden then shifts to the non-

moving party to prove, by more than mere denial and speculation,

that a genuine issue does exist. S.M. v. R.B. (1993), 261 Mont.

522, 862 P.2d 1166. Having determined that genuine issues of fact

do not exist, the court must then determine whether the moving

party is entitled to judgment as a matter of law. Lindey's, Inc.

v. Professional Consultants, Inc. (1990), 244 Mont. 238, 797 P.2d

920. We review the legal determinations made by a district court

as to whether the court erred. Matter of Estate of Alcorn (1994),

263 Mont. 353, 868 P.2d 629.

ISSUE

Did the District Court err in granting summary judgment on the

issues of negligent retention and sexual harassment?

The District Court concluded that the exclusive remedy for

injury occasioned by this type of conduct is to be found in the

Montana Human Rights Act under § 49-2-509(7), MCA. Reference was

made to Harrison v. Chance (1990), 244 Mont. 215, 797 P.2d 200,

which so holds. The court further concluded that plaintiff had

failed to bring her claim in a timely fashion under the relevant

statutes whether the 180 day statute or the 300 day statute be

applied. Plaintiff had failed to bring a claim for more than 487

days. The District Court referred to the following allegation in

the verified complaint of the plaintiff before the MHRC:

I knew that I had legal rights available to me to sue the

County, however, I was willing to forego those rights on

condition that Mr. Hoefer be removed from his employment

and would never be in a position to sexually harass a

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secretary again.

Plaintiff contends the defendants are directly liable to her

for negligence in retaining Hoefer, independent of Hoefer's

sexually harassing conduct. Plaintiff argues that the defendants

knew of Hoefer's conduct toward women but did nothing and that had

the defendants acted responsibly, she would not have been injured

by Hoefer.

Defendants contend that plaintiff cannot bring a tort action

for negligent retention because it is still a tort action which was

derived from Hoefer's sexual harassment and that plaintiff's sexual

harassment claim is barred due to its untimeliness.

As the moving parties for summary judgment, the defendants had

to show a complete absence of any genuine issues of fact deemed

material in light of substantive principles that entitle that party

to judgment as a matter of law. -,

S.M. 862 P.2d at 1168. The

defendants contend they satisfied that burden by showing that no

material facts existed which would provide a cause of action

against the County. Plaintiff also relies upon the letter sent by

the County Attorney to Hoefer on May 19, 1992, following her

resignation and the independent investigation. The letter

contained the following paragraph with regard to Hoefer:

Specifically you were warned by both Chief Deputy Daniel

Schwarz and myself [Paxinosl that your expectation that

[Wendil accompany you to all your court matters had been

overdone. We further warned you that you were alienating

[Wendil from the rest of the staff. . You were

specifically requested to attend a seminar dealing

specifically with sexual harassment, which you did.

Chief Deputy Schwarz and myself gave you specific

instructions to neither take breaks nor have lunch with

[Wendi] alone. You were specifically instructed that

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there should always be at least one other support staff

person or fellow attorney to protect both yourself and

[Wendi] from any allegations of misconduct or

inappropriate behavior.

While this letter suggests the possibility that the County Attorney

had knowledge of Hoefer's conduct prior to the date of his

dismissal, such facts are not material to the resolution of the

summary judgment issue. Summary judgment is appropriate where a

plaintiff fails to set forth facts which would establish each

element of the alleged cause of action. Dvorak v. Matador (19861,

223 Mont. 98, 727 P.2d 1306. Plaintiff merely argues that the

defendants knew before her resignation that Hoefer was causing

problems. In itself that letter fails to establish the elements of

the tort of negligent retention.

The letter does demonstrate that the defendants had taken

steps to eradicate unprofessional behavior on Hoefer's part.

Plaintiff failed to rebut the elements of the affidavit of the

County Attorney which established that as soon as the County

Attorney was notified by the plaintiff that a problem existed,

Hoefer was suspended and investigated. The affidavit establishes

without contradiction that Hoefer never worked a day after the

plaintiff resigned. Plaintiff failed to set forth any facts

demonstrating actual notification to the defendants about Hoefer's

behavior until she actually resigned.

The key question is whether plaintiff could have recovered for

negligent retention as a matter of law. The District Court relied

on Harrison for the proposition that the exclusive remedy for any

complaint arising from sexual harassment is § 49-2-509(7), MCA.

6

Plaintiff argued that her action against the County was not based

upon sexual harassment. Our more recent holding of Hash v. U.S.

West COmmUniCatiOn SerViCeS (1994), 886 P.2d 442, at page 445-46

held:

Hash asserts that timely filing of a discrimination

claim with the HRC is not a prerequisite to filing with

the district court. We previously have resolved this

issue against Hash's position. In Harrison v. Chance

(1990), 244 Mont. 215, 797 P.2d 200, we held that the Act

provides the exclusive remedy for sexual discrimination

claims. We did so on the basis that a 1987 legislative

amendment made the Act the exclusive remedy for sexual

discrimination. We held that the "statutory procedures

for discrimination are exclusive remedies and cannot be

bypassed." Harrison, 797 P.2d at 203. Like the

plaintiff in Harrison, Hash chose to file a

discrimination claim in district court without first

timely filing her complaint with the HRC.

.

The Legislature clearly intended that the Act be the

exclusive remedy for discrimination claims. We adopted

this intent in Harrison and maintain it in the instant

case. To permit parties to delay filing with the HRC

until the HRC filing time ran out and then file their

claims directly in district court would, in a sense, gut

the Act. We reaffirm our decision that the HRC is the

exclusive remedv for Hash's discrimination claim.

(Emphasis supplied.)

In Harrison, this court further considered claims for

intentional infliction of emotional distress and outrage arising

from the charges of sexually explicit conduct and also theories of

wrongful discharge and breach of the implied covenant of good faith

and fair dealing. In our present case, plaintiff has charged the

defendants with negligent retention of Hoefer. At that point, the

following statement in Harrison is pertinent:

As in this case, any claim based upon sexual

harassment can be framed in terms of numerous tort

theories. The legislature expressed its intent that the

Commission provide the exclusive remedy for illegal

discrimination when it enacted subsection (7) of § 49-2-

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509, MCA. To allow such recharacterization of what is at

heart a sexual discrimination claim, would be to

eviscerate the mandate of the Human Rights Commission.

Harrison, 797 P.Zd at ZOO. Plaintiff contends that the tort she

charged has nothing to do with Hoefer's sexual harassment. Clearly

that is not a proper conclusion. If the sexual harassment were

removed from the factual picture, plaintiff would have no tort

claim. Because the sexual harassment is at the foundation of her

claim of negligent retention, the only remedy she has is in the

Montana Human Rights Act, §§ 49-2-101 et seq., MCA. We conclude

that the holdings of Hash and Harrison are controlling and that the

exclusive remedy for the claimed negligent retention of Hoefer and

sexual harassment by Hoefer is to be found in the Montana Human

Rights Act.

Section 49-z-501, MCA, required plaintiff to file her claim

with the MHRC within 180 days, or if a grievance is filed first,

300 days. Plaintiff failed to file her claims within those periods

of time. Plaintiff attempts to argue that she agreed not to file

charges if the County would fire Hoefer and he could not harass

other women. She became frustrated when she learned that the

County had paid Hoefer $30,000, and then instituted these

proceedings.

Plaintiff has failed to demonstrate any contract or agreement

on the part of the defendants which was breached in connection with

Hoefer. Plaintiff resigned on April 8, 1992, and raised to the

County Attorney the issue of inappropriate behavior by deputy

Hoefer. The County Attorney suspended Hoefer on April 9, 1992, and

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Hoefer did not work for Yellowstone County after that time.

It is true that the MHRC eventually determined that the

statutory filing time should be tolled on a theory of equitable

estoppel. However, the District Court specifically considered this

issue and concluded that equitable estoppel did not apply so that

the complaint was untimely filed.

Equitable estoppel is not favored and will be sustained only

upon clear and convincing evidence. Ducham v. Tuma (1994), 265

Mont. 436, 877 P.2d 1002. To constitute equitable estoppel, there

must be conduct amounting to representation or concealment of

material facts; these facts must be known to the party estopped at

time of conduct; truth concerning these facts must be unknown to

the other party claiming benefit of estoppel at the time it was

acted upon; conduct must be done with intention, or at least with

expectation that it will be acted upon by the other party; conduct

must be relied upon by the other party and the other party must in

fact act upon it in such a manner as to change his position for the

worse. Kephart v. Portmann (1993), 259 Mont. 232, 855 P.2d 120.

Nothing in the record indicates that the County failed to

carry through any representations to plaintiff. Hoefer did not

work following the filing of plaintiff's resignation. Plaintiff

resigned as of the end of April in 1992, yet it was not until the

end of May 1992 that the Commissioners decided to pay Hoefer to

resign voluntarily without filing an action against the County.

Thus, there never was any representation to plaintiff that the

County would not pay Hoefer money to disappear. Plaintiff never

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Justice W. William Leaphart dissenting.

I dissent. For reasons outlined below, I would recognize the

tort of negligent retention in Montana and reverse the grant of

summary judgment.

The tort of negligent retention:

arises when, during the course of employment, the

employer becomes aware or should have become aware of

problems with an employee that indicated his [or her]

unfitness, and the employer fails to take further action

such as investigating, discharge, or reassignment.

Yunker [v. Honeywell], 496 N.W.Zd [4191 423 (quoting

Garcia v. Duffy, 492 So.2d 435, 438-39 (Fla.Dist.Ct.App.

1986) ) .

ML v. Arndt (Minn. App. 1995), 531 N.W.2d 849, 857 (employee that

had previously shot a co-worker and showed aggression towards

coworkers was retained). In Vollmer v. Bramlette (1984), 594

F.Supp. 243, the Federal District Court for the District of Montana

concluded that an employer has a duty to protect his or her

employees from foreseeable employee-caused harms. That court

concluded that in the negligent hiring context, "the question of

foreseeability, such as which would give rise to a duty of the

employer, is a question of fact not properly disposed of by summary

judgment." Vollmer, 594 F.Supp. at 248.

The basis of responsibility under the doctrine of

negligent hiring is the master's own negligence in hiring

or retaining in his employ an incompetent servant whom

the master knows or by the exercise of reasonable care

should have known was incompetent or unfit and thereby

creating an unreasonable risk of harm to others.

Estate of Arrington v. Fields (Tex. Civ. App. 1979), 578 S.W.2d

173, 178.

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The District Court in the case at hand, found that Bruner's

claim for negligent retention was founded in unrelenting sexual

harassment during her employment and that the exclusive remedy for

this type of conduct (sexual harassment) is found in the Montana

Human Rights Act. I disagree. Exclusivity only applies if the two

remedies share indispensable elements. Sexual harassment under the

HRA and negligent retention do not share indispensable elements.

The HRA requires proof of discrimination. The tort of negligent

retention does not.

In Retherford v. AT&T Communications of the Mountain States,

Inc. (Utah 1992), 844 P.2d 949, the plaintiff alleged, among other

claims, that AT&T negligently employed several employees who

harassed her. The court analyzed whether Utah's Anti-

Discriminatory Act (UADA) provided the exclusive remedy for her

claims. The court adopted the indispensable element test as the

analytical model to determine whether a statutory cause of action

forecloses a common law remedy. Retherford, 844 P.2d at 963.

Applying the test, the court first identified the injury that the

statute was designed to address. Retherford, 844 P.2d at 965.

Second, the court examined the elements of the plaintiff's tort

claims to determine whether any element of the claim was a

necessary element of the statutory cause of action. Retherford,

844 P.2d at 965. That court concluded that the UADA addressed

employment discrimination against members of specified protected

groups. The court found that:

[nloticeably absent from the list of the indispensable

elements of the four claims [one of which was negligent

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employment] is an injury that is a target of the UAUA:

retaliation for complaints of sexual harassment. While

it is true that all four claims arise out of defendants'

retaliatory conduct, preemption depends on the nature of

the injury, not on the nature of the conduct allegedly

responsible for that harm.

Retherford, 844 P.2d at 967.

I would apply the two-part test from Retherford to the instant

case. First, the injuries addressed by the Montana Human Rights

Act (HRA) include various employment-related discriminatory acts.

Second, the elements of Bruner's tort, negligent retention, require

that Bruner prove that Yellowstone County's "negligence in hiring,

supervising, or retaining its employees [Hoeferl proximately caused

her harm." See Retherford, 844 P.2d at 967. The HRA does not

address negligent retention of an employee who harasses or

discriminates against another employee. Rather, the HRA focuses on

the discriminatory acts of the employer which directly impact upon

the injured employee. The HRA provides in relevant part that:

(1) It is an unlawful discriminatory practice for:

(a) an employer to refuse employment to a person,

to bar a person from employment, or to discriminate

against a person in compensation or in a term, condition,

or privilege of employment because of race, creed,

religion, color, or national origin or because of age,

physical or mental disability, marital status, or sex

distinctionL.1

Section 49-2-303(l) (a), MCA.

If Bruner were alleging that Yellowstone County was harassing

or discriminating against her then she would have a claim under the

HRA and any common law harassment and discrimination claims against

Yellowstone County would be preempted. Likewise, a claim against

the County based upon Hoefer's harassing conduct would merely be

13

derivative in nature and would be preempted. However, here, Bruner

is suing Yellowstone County, not for Hoefer's conduct, but for the

County's own negligence in retaining Hoefer in a position where,

given his prior history of harassing other women, it was

foreseeable that he would harass Bruner.

The claim for negligent retention focuses on Yellowstone

County's failure to terminate Hoefer once it learned that Hoefer

was harassing women employees--i.e. Bruner's predecessors. The

factual basis of the negligent retention claim against Yellowstone

County started before Bruner was even hired. Bruner presented

deposition testimony from the county attorney indicating that he

was concerned that Bruner's two predecessors would file

constructive discharge claims against the County based upon

Hoefer's conduct towards them. This testimony certainly raises a

question of fact as to the County's prior knowledge (i.e.

foreseeability) sufficient to defeat a motion for summary judgment

on the claim of negligent retention.

The HRA addresses discrimination against an employee as

opposed to negligence in hiring or retaining an employee. Burner's

claim of negligent retention is not premised upon discrimination.

Secondly, her claim is based upon the County's own actions, not

those of Hoefer. Thus, her claim of negligent retention is not

preempted by the HBA and is not controlled by the time constraints

of § 49-2-501, MCA, which requires filing with the HRA within 180

days or with the EEOC within 300 days.

I would reverse the District Court's grant of summary judgment

14

on the question of negligent retention. I do not believe that the

claim of negligent retention was preempted by the HRA nor do I

believe that the claim of negligent retention is subject to the

filing deadlines of the HRA.

Just?& . I

Justices William E. Hunt, Sr., and Terry N. Trieweiler join in the

foregoing dissenting opinion.

Justice

dJ&

7’ . / ustice

4”

Justice James C. Nelson specially concurs.

I concur with the result reached in our opinion because I am

satisfied that application of our decision in Harrison v. Chance

(1990), 244 Mont. 215, 797 P.2d 200, mandates that result. I do

not, however, read our opinion as a refusal to recognize the tort

of negligent retention in a case involving different underlying

facts. As far as I am concerned, that issue remains to be decided

in the future.