UIM Limit Paid to Injured Motorcyclist

Source: Montana Law Week

INSURANCE: UIM limit paid to injured motorcyclist after challenge to insurer’s reducing clause vis-à-vis separate recovery from tortfeasor’s employer.

Domino’s Pizza driver Daniel Goerss turned in front of motorcyclist Will Bakke in 5/16, throwing him 20 feet into a utility box. Bakke suffered a lumbar burst fracture, fractured
left femur, and fractured coccyx and underwent 4 surgeries.

Goerss’s insurer Progressive paid its $25,000 policy limit. Progressive was also the UIM carrier. Bakke sued Domino’s. He requested UIM from Progressive 5/24/17. Adjuster Adam McMurray in Bozeman responded 5/25 with “another copy of the policy declarations confirming the policy limit of $25,000 available as well as a copy of the UIM portion” of the policy and “please note the Limit of Liability under the coverage which
states- The damages under this Part III will be reduced by all sums:
1. paid because of bodily injury by or on behalf of any persons or organizations that may be legally responsible;
2. paid under Part I – Liability To Others; and
3. paid or payable because of bodily injury under any of the following or similar laws:
a. workers’ compensation law; or Verdict/settlement/judgment reports invited.
b. disability benefits law.

So this means that this UIM coverage will come into effect if it is proven the damages incurred exceed all underlying liability coverages. In the event the excess liability coverage with [redacted] for Domino’s is not adequate and this coverage is
triggered we will need copies of the policy declarations for all underlying liability coverages” and “I will also need the information previously requested and full documentation of all damages claimed.”

Bakke and Domino’s insurer mediated 5/9/19 and settled on undisclosed terms.

Bakke’s attorney wrote Progressive 5/22/19 reiterating his request for UIM and advising that its reliance on its reducing clause was a violation of Montana law. He advised that there was little question that Goerss is judgment proof — he was 19 when he hit Bakke’s motorcycle and is unemployed. He stated that the reducing clause is hardly clear, particularly as to how it may apply to Bakke, but that Progressive appeared to claim
that because Goerss was a Domino’s employee and because Bakke chose to pursue an independent, long, and expensive claim against Domino’s, Bakke’s UIM became excess coverage only, which would only be payable if Domino’s coverage was not enough to cover his injuries. He stated that there is no support for this argument to avoid previously paid for UIM benefits in Progressive’s declaration page or policy, and that it conflicts with a black letter Montana principle that an “insurer is under a duty to construe the factual assertions from the perspective of the insured rather than solely from the insurer’s own perspective.” Staples (Mont. 2004). He stated that it also runs afoul of Montana’s reasonable expectations doctrine, and that the reasonable expectation of Bakke’s declaration page and UIM policy for which he paid premiums would indicate that he would be entitled to $25,000 UIM after being struck by Goerss given that Goerss was underinsured as defined under the policy. He asserted that Progressive’s reducing clause is “nothing more than subrogation that Progressive is attempting to award itself” in violation of Montana’s “made whole” doctrine and is subject to the “common fund” doctrine which provides that “when a party through active litigation creates, reserves or increases a fund, others sharing in the fund must bear a portion of the litigation costs including reasonable attorneys’ fees.” Hall (Mont. 2011). He asserted that Progressive is the “passive beneficiary” of Bakke’s claim against Domino’s at no cost to Progressive, which further violates the law. He further asserted that Progressive’s interpretation of its reducing clause would result in unjust enrichment to Progressive, while Skauge (Mont. 1977) held that if one party to the insurance transaction must bear the loss, it should be the insurer, since that is the risk the insured paid it to assume.

Progressive adjuster Carla Giroux in Stevensville wrote Bakke’s attorney 5/28 “thank you for providing the additional information needed to evaluate Mr. Bakke’s injuries and potential future needs related to this pending underinsured motorist injury claim” and advising that “we have issued payment in the amount of $25,000 which represents Mr. Bakke’s underinsured motorist coverage.”

Shea Law Firm Defends Stalking Charge Getting it Dismissed.

Gallatin County Sheriff’s Office Deputy filed a stalking charge against a fellow deputy, who was represented by the Shea Law Firm. The deputy charged with stalking was terminated from Gallatin County Sheriff’s Office but then successfully sued and obtained reinstatement of his position and settled with Gallatin County.

The Shea Law Firm defended the stalking charge and the Court dismissed the charge finding the charges “stupid.”

Case Unripe for Summary Judgment

Source: Montana Law Week

INSURANCE: Uncertainty and unresolved facts & claims in sewer line easements suit make this declaratory action as to defend/indemnify duties unripe for summary
judgment… Gilbert.

Gardiner-Park Co. Water & Sewer Dist. claims that Donald & Gina Knight constructed 2 homes on their property that improperly overlay and endanger its sewer line. It claims that they constructed a house for their son Landon in 2014 over its sewer lines despite its objections. It claims that this house could crush the old clay tile line, causing disruption or leakage into the Yellowstone River. It claims that they constructed a 2nd
house over the line subsequent to and in violation of a 2015 easement signed by Donald Knight. Knights contest validity of his signature, claiming that he signed following surgery and while under the influence of medication. The District alleges that prior to construction it agreed to pay for and construct a new manhole to reroute the line and accommodate the 2nd house.

This rerouting allegedly involved obtaining another easement from Knights’ neighbors, Obers. Both easements prohibited construction within 5 feet of the line without the District’s permission. However, the District’s underlying suit claims that Knights constructed the 2nd house over the line in violation of both easements. A survey prepared for the District concluded that parts of both homes were within the easements. The District also alleges that Knights caused a retaining wall to collapse, threatening support for part of the line above the river. Its underlying suit accordingly brought claims of intentional trespass, intangible trespass, public & private nuisance, negligence/strict liability, and breach of contract against Knights. Its underlying
suit seeks a declaration that Knights violated the easements, an award of damages, costs, and attorney fees, and an order directing removal of structures threatening the line and violating the easements (both homes and a shed) at Knights’ expense.

Knights counterclaimed against the District alleging that it was aware of placement of the homes and improperly waited to raise concerns until 4/16. They dispute validity of the 2015 easements, claiming that Donald Knight was taking strong pain killers at
the time of signing. They claim that the District improperly forced them to remove parts of the 2nd home’s roof & porch, causing damage to their property. They request damages, attorney  fees & costs, denials of the District’s claims, and injunctive orders prohibiting removal of any structures and directing that the homes “remain in place.”

MACo Joint Powers Insurance Authority filed a declaratory action asking the Court to declare that it has no duty to defend or indemnify the District based on “clear exclusions” in the policy. MACo and the District request summary judgment. The Court heard argument 2/11/19. A notice and affidavit of Todd Shea filed 2/8/19 indicate that the District has filed a contribution & indemnification claim against Standish Excavation as a 3rdparty Defendant in the underlying suit. Further, there are expected amendments to the pleadings by some or all of the parties as a result of this and further discovery is anticipated.

The District raises the issue of ripeness, relying on cases holding that “where there remain unresolved relevant issues in the underlying case, inseparable from the issues presented in the declaratory judgment action, the duty to indemnify is not ripe for resolution.” American Reliable (D.Mont. 2018); Skinner (Mont. 2005). The concern is that ruling on the duty to indemnify before allowing the facts to be determined in an underlying action fails to be a final adjudication on the indemnification issue. Such
a ruling may be subject to amendment or nullification when the underlying case is finally resolved. Northfield v. MACo (Mont. 2000).

MACo responds that its summary judgment motion seeks a ruling that it is not obligated to defend or indemnify the District. It points out that there is a long line of Montana cases that have decided whether coverage exists by analyzing whether the allegations of the underlying complaint trigger the duty to defend. Further, since the duty to defend is broader than the duty to indemnify, if there is no duty to defend, the underlying claim
falls outside the scope of coverage. Twite (Mont. 2008). “Put another way, while an insurer’s duty to defend is triggered by allegations, an insurer’s duty to indemnify hinges not on the facts the claimant alleges and hopes to prove but instead on the facts, proven, stipulated or otherwise established that actually create the insured’s liability.” Freyer (2003). MACo further relies on Grindheim (D.Mont. 1995) (“An insurer’s duty to defend
its insured arises when the insurer, through reference to pleadings, discovery, or final issues declared ready for trial, has received notice of facts representing a risk covered by the terms of the policy.”). Thus, MACo argues, if a claim falls unequivocally outside the policy’s coverage, there is no basis for imposing a duty to defend. MACo contends that the District is attempting to eliminate the duty to defend analysis by merging it into the
narrower duty to indemnify analysis. It points to case law holding that an insurer “had no duty to defend [the insured] because the complaint cannot be construed to give rise to a claim under the terms of the policy.” Weitzel (Mont. 2016). It rejects the District’s argument that unresolved factual issues preclude a determination of coverage, since the Supreme Court has recognized that “factual disputes between the parties relevant to
coverage must be resolved in favor of coverage.” Id. It argues that Northfield and American Reliable are not on point because they addressed only the issue of indemnification and did not analyze the duty to defend.

The District counters that MACo misconstrues its ripeness argument. It relies on authority that where there are unresolved relevant issues in the underlying case that are inseparable from the issues in the declaratory action, the duty to indemnify is not ripe. It argues that there are unresolved issues here that are inseparable from MACo’s summary judgment motion seeking a ruling that it is not obligated to defend or indemnity the District for Knights’ claims. It takes issue with MACo’s effort to distinguish Northfield as only addressing indemnification since the opinion notes at the outset that MACo had already assumed the defense, so the duty to defend was not at issue. It reiterates
that it relies on Northfield for the holding denying Northfield’s request for a declaratory ruling on its potential indemnification obligations because there were unresolved factual issues in the underlying case. Northfield also relied on the DJA, which authorizes a court to refuse to enter a declaratory ruling if doing so “would not terminate the uncertainty or controversy giving rise to the proceeding.” §27-8-206. In Northfield, MACo successfully
defended against Northfield’s motion by contending that the plaintiffs in the underlying case could subsequently amend their complaint and therefore Northfield’s motion seeking declaratory relief on its indemnification obligation was premature. The District maintains that American Reliable ultimately determined that it could not rule on whether there was an occurrence under the policy because of ongoing factual issues in the underlying case. Given this decision, it determined that American Reliable’s duty to defend was ongoing.

There are not only unresolved factual issues in the underlying litigation here, but also claims that have not been filed. This case is not to the stage where there is sufficient finality of pleadings, discovery, or final issues declared ready for trial, such that the Court can determine MACo’s duty to indemnify or defend. If the Court ruled on the summary judgment motions at this juncture, such rulings may be subject to nullification or amendment after further amendment of the pleadings, further discovery, or further proceedings. The Court is cognizant of MACo’s desire to have a ruling based on the state of the pleadings at the time it filed its summary judgment motion. However, doing so “would not terminate the uncertainty or controversy giving rise to the proceeding.” There is sufficient basis to deny MACo’s motion in keeping with the DJA §27-8-206.

The parties are preparing amended pleadings, most significantly Knights’ assertion of a 3rd-party claim which, if filed, would be crucial to MACo’s assessment of its position and the Court’s determination of the matters presented by the summary judgment motions now before the Court. The District has just recently asserted a 3rd-party contribution & indemnification claim, bringing a new party into the underlying case. Discovery has already been extended into 5/19,  and the addition of a new party may give rise to further requests for amendment of the Scheduling Order. The procedural status
puts this case beyond the level of uncertainty and unresolved facts in Northfield or American Reliable.

MACo’s motion for summary judgment and the District’s cross-motion for summary judgment must be denied.

Yellowstone National Park, Gardiner to address arsenic in sewage

Written by: Brett French,  Billings Gazette

Three years after filing suit against Yellowstone National Park and four years after a problem was first identified, a settlement conference has been set for May 9 between the park and the Gardiner-Park County Water and Sewer District over excessive levels of arsenic in the Gardiner sewage ponds.

“It looks like we have made some headway,” said Todd Shea, a Bozeman attorney representing the sewer district.

The sewer district sued in 2016 saying the park had not been responsive to requests to address the issue. The problem has been identified as either a leak into the pipes that deliver wastewater from Mammoth Hot Springs, Wyoming — the headquarters for the park’s staff — or manholes that are allowing arsenic-laden runoff into the system. Tests of the wastewater showed the arsenic levels coming from the park were 40 times higher than water from Gardiner’s wastewater system.

Mammoth does not have its own wastewater treatment facility. Tests performed on the drinking water at Mammoth ruled out that as the source of heavy arsenic.
Arsenic is a naturally occurring element found in rocks and soil and is prevalent in the water coming from Yellowstone’s thermal hot pools and geysers. If ingested in large enough quantities, arsenic can cause a variety of ailments in humans affecting organs as diverse as the heart and liver, lungs and nervous system.

U.S. drinking water is permitted to contain up to 10 parts per billion of arsenic, according to the National Institute of Environmental Health Sciences. Some states have stricter standards, but Montana adheres to the federal level.

Tests by the Montana Department of Environmental Quality in 2015 showed high arsenic levels in rivers that drain from Yellowstone National Park into Montana, including 367 ppb in the Firehole, 197 ppb in the Gibbon and 300 ppb in the Yellowstone River.

In 2015 the Montana Department of Environmental Quality advised the Gardiner Water and Sewer district that sludge should be removed from its treatment ponds and new liners installed. But undertaking that task made no sense if the arsenic problem was not addressed.

After twice advising Yellowstone officials of the problem by letter with no response, the complaint said the park’s staff finally acknowledged its role for the issue during a meeting and agreed to help fund the sludge removal from the wastewater ponds, a project estimated to cost about $2 million.

More than a year and a half after first mailing the park’s staff for specifics on how it would help, the Gardiner Water and Sewer District was told by park officials that the agency would not be able to address the problem until 2020 due to a lack of funding, according to the complaint. That’s when the district sued.

Since that lawsuit was filed in U.S. District Court in 2016, the sewer district amended its complaint last year and then both parties sought a suspension of the proceedings which Judge Timothy Cavan denied in November. He also ordered the park to respond to the amended complaint by Dec. 22.

That was the same day that the government shutdown began, the longest in U.S. history and stretching to Jan. 25.

Just two days before the shutdown, a settlement conference between the sewer district and park was approved by the court in an attempt to keep the case from going to trial. The settlement talks will be overseen by U.S. Magistrate Judge Jeremiah Lynch. Magistrate judges assist district courts.

The first conference was set during the government shutdown, so another was scheduled for May 9 before Lynch in Billings at 9 a.m.

Appeal of Investment Accounts Interpleader Dismissed

Source: Montana Law Week

APPEAL BOND: Appeal of investment accounts interpleader dismissed at request of Appellant for inability to post bond… order.

Dennis Bohnert has an investment account, a traditional IRA, and a Roth IRA with Edward Jones. His stepdaughter Lisa Copiskey filed a motion in Tribal Court in 9/15 contending that they belong to her. Tribal Court granted the motion and prohibited Bohnert from dissipating any funds. Copiskey requested that Jones not release any funds to Bohnert. He requested access to the accounts for living expenses and defense costs. Both appealed to Tribal Appeals Court in 5/16 contesting the orders. Jones placed a hold on the accounts and advised that it would release funds to Bohnert if the parties agreed on an amount. Because they continued making competing demands to the funds, Jones filed an interpleader in 9th Judicial Dist. Court. Bohnert opposed the interpleader and counterclaimed against Jones. Judge Best dismissed the counterclaim and awarded Jones $24,959 attorney fees & costs, 2/3 apportioned to Bohnert. (MLW 1/28/17). Bohnert appealed and moved for a stay and waiver of appeal bond, which Jones opposed. The motion was denied 4/18/17. Bohnert filed 2 motions in the Supreme Court seeking the same relief and both were also denied. He now moves to dismiss his appeal due to the fact that he has made “numerous attempts to obtain the funds to prosecute his appeal, i.e. the purchase of a Supersedeas Bond from a commercial surety,” by moving for a stay and waiver of bond in District Court and the Supreme Court in view of Jones withholding monies totaling $286,005.80 and he is unable to sell his home and cannot borrow against it due to Jones’ judgment lien.

For good cause shown, Bohnert’s appeal is dismissed.

Yellowstone National Park to replace sewer line related to arsenic lawsuit

Source: Michael Wright, Bozeman Chronicle Staff Writer

Yellowstone National Park will replace a stretch of sewer line sometime over the next two years in an attempt to solve arsenic problems that led to a lawsuit against the park last year.

A U.S. Department of Interior attorney sent a letter to an attorney for the Gardiner-Park County Water and Sewer District that says Yellowstone plans to remove 2,700 feet of clay sewer line near Mammoth Hot Springs and replace it with PVC pipe.

The district sued the National Park Service in December 2016 because of heightened arsenic levels in its sludge ponds that it attributes to Yellowstone National Park.

The Interior attorney, Colleen Burnidge, wrote that the pipe project may take two years to complete, but they think it will help solve the problem.

“We believe that this project will address arsenic inflow and infiltration into the District’s sewage line,” she wrote.

Yellowstone National Park spokeswoman Morgan Warthin said in an email that the project has been funded and would begin either this year or next year. She couldn’t say how much the project would cost or whether it was a result of the lawsuit or a previously planned improvement.

She said they couldn’t give out further details because it’s part of a lawsuit.

Todd Shea, an attorney for the Gardiner-Park County Water and Sewer District, declined to comment.

The Gardiner-Park County Water and Sewer District sued Yellowstone in December 2016 over high levels of arsenic found in the district’s sewage treatment facilities. The district asked the court to force Yellowstone to give the district money, fix the leak and monitor its sewer lines in the future.

Sewage from Mammoth Hot Springs has gone to the district’s treatment facilities north of Gardiner for years. The district uses sludge ponds to treat wastewater, and the ponds need to be emptied periodically. Sludge removal is expensive, and high arsenic levels make it even more expensive.

According to the complaint, an engineer told the district in February 2015 that high levels of the odorless chemical were entering the treatment facility. The engineer also said that 95 percent of the arsenic was coming from Yellowstone, and testing showed the park’s sewage had arsenic levels nearly 40 times that of the Gardiner sewage.

The Montana Department of Environmental Quality had directed the district to empty the ponds, but the engineer recommended they wait to do so until the park fixed its arsenic problems, according to the complaint.

The district told the park in a 2015 letter that it couldn’t drain its sludge ponds until the arsenic problem from the park was solved. In 2016, the park finally responded, saying there likely wouldn’t be funding to fix the problem until 2020.

The district sued in December 2016, asking both for the park to fix the arsenic leak and to help pay for sludge removal — the cost of which was estimated at $2 million.

Funding has apparently come through for the project, according to the Interior Department letter, which was attached to a court filing that essentially puts the lawsuit on hold. The letter says the project will replace “deteriorated sewer lines” between the youth camp and Mammoth. The youth camp is south of the park headquarters and the Mammoth Terraces.

There is no mention of what the Park Service might contribute to the sludge removal — the other claim in the lawsuit — but Burnidge did write that they hope “the parties can work together to resolve any issues.”

Park County developers appealing water dispute to Montana Supreme Court

Written by: Michael Wright,  Bozeman Daily Chronicle Staff Writer 

A pair of Park County developers are taking their spat with the local water district to the Montana Supreme Court after a district judge ruled against them.

Max and Sue Berg, represented by attorney Karl Kneuchel, have filed a notice of appeal with the state’s high court in their case against the Gardiner-Park County Water District over the abandonment of a water pipe that served their subdivision near Gardiner.
A Park County district judge earlier this year ruled against them and ordered them to pay the district more than $666,000 in damages.

Kneuchel, the Bergs’ attorney, did not return a call seeking comment before deadline. Todd Shea, the attorney representing the water district, declined to comment because of the appeal.

The Bergs are the developers of the Fort Yellowstone subdivision north of Gardiner along Highway 89. Court documents say they got designs for the subdivision and water and sewer lines approved by the Montana Department of Environmental Quality in 1993.

An existing sewer line that served Mammoth and Gardiner was going to serve the subdivision, but the water line needed to be extended. According to court documents, the Bergs built the extension on the slope between the highway and the Yellowstone River but never built a retaining wall, which was required by the DEQ to stabilize the hillside.
In 2007, an engineering firm warned the water district that the water line might rupture because of erosion caused by the lack of a retaining wall. Court documents say that the engineering firm warned the district that the pipe’s failure could bust the sewer line as well, and potentially result in “millions of gallons of raw sewage” being washed into the Yellowstone River.

Court documents say the water district decided to disconnect the Bergs’ water line and install a new one above the subdivision. Around the same time, DEQ asked the Bergs to confirm whether the water line was built according to the plans, which included a retaining wall. That led to DEQ revoking their permit for the subdivision in 2009.

The Bergs later sued the water district in Park County District Court, arguing that the district’s decision to abandon their water line was detrimental to their subdivision. They asked for upward of $2 million in damages.

The water district denied their claims and in turn countersued the Bergs. Park County District Judge David Cybulski ruled in their favor in late August.

The Bergs’ notice of appeal to the Supreme Court was filed in early October. Formal briefs that lay out their argument will follow.

$666,534.11 Judgment in Favor of Water District against Subdivision Developers

Source: Montana Law Week

WATER EASEMENT TRESPASS/NUISANCE: $622,196.56 damages, $29,991 attorney fees, $14,346.55 costs to Water District against subdivision developers for failure to build retaining wall to prevent erosion of earth protecting water & sewer lines consequently requiring new water line to town… $278,521.81 damages to homeowners… Cybulski.
Max & Sue Berg own Fort Yellowstone subdivision in Gardiner. Max Berg owned Berg Excavation for 25 years and has experience building subdivisions, water lines, sewer lines, roads, and retaining walls. Bergs applied in 1992 for the subdivision with water & sewer to be supplied by what is now known as Gardiner-Park Co. Water & Sewer Dist. The sewer line was an existing line serving Gardiner and Mammoth, but a water line extension needed to be constructed by Bergs to serve the subdivision. The DEQ-approved plans provided that a water line would be on a steep slope between Hwy 89 and the Yellowstone River. A road would be built between the water line and river to provide access to condos along the river. A retaining wall was to be built between the road cut and water line to stabilize the slope. Max Berg installed the water line and road in 1995, but did not install a retaining wall. A year after activating the water line, the Water Dist. noticed that he had punched in a road under the line. The Manager explained that the road “destabilized the slope. The main was essentially along a cliff face.” Despite this, Bergs did not install a retaining wall. Bergs sued Gaston Engineering in 1999 alleging negligence in locating the water line and road below it which resulted in Bergs being “forced to import and place fill as well as build a retaining wall.” Bergs and Gaston settled in 11/00. Great West Engineering warned in 5/07 that the water line was in jeopardy of rupturing because of erosion due to lack of a retaining wall. The District advised Bergs that it planned to disconnect the line and install a new one in the highway right of way. DEQ issued Bergs a violation letter in 3/08 for failure to construct the retaining wall, followed by multiple communications. In 4/08 Bergs advised that they had retained an engineer to design & install gabion basket walls instead of a retaining wall. DEQ approved the substitution. As of 7/09, the gabion baskets had not been installed. DEQ issued a notice of revocation to Bergs pertaining to the subdivision in 10/09 for failure to install the retaining wall. Bergs appealed. Board of Environmental Review affirmed the revocation. Bergs sued the Water Dist. in 12/08 for inverse condemnation, trespass, and quiet title. The District counterclaimed alleging trespass and nuisance and requesting injunctive and declarative relief. The District requests summary judgment.
Bergs trespassed on the District’s easements by causing erosion of the earth cover below the water & sewer lines resulting in no longer having the cover required by its easements. The trespasses also include Berg performing excavation work within the easement areas without permission and leaving boulders on the sewer line easement. The trespass is continuing by virtue of the continued erosion.

Bergs’ conduct that caused erosion of the earth supporting the lines amounts to a public nuisance. The eroding condition of the slope continues to be “injurious to health” “so as to interfere with the comfortable enjoyment of life.” §27-30-101(1). The Gardiner community was “affected” by the eroding condition and installation of a new water line at a cost of $100,000. At the very least, a “neighborhood” of Gardiner was “affected” in that the line installed by Bergs had to be abandoned and a new line installed in the highway right of way. The ongoing threat to the existing sewer line and abandoned water line continues to “affect” at the very least a “neighborhood” of Gardiner. Subdivision lot owners McInerney and Hoffers previously sued Bergs for failing to install a retaining wall resulting in inability to build on any properties. The Court granted summary judgment for them. Bergs created a private nuisance to the Water District by diminishing and damaging its rights to the water and sewer lines. Judgment for the Water Dist. is granted on its public and private nuisance claims.

Bergs are enjoined from causing further erosion below the water and sewer lines. The District is granted access to the Ft. Yellowstone property to inspect and maintain its lines and remediate the erosion.

Following a damages hearing, the Court awarded the Water Dist. $622,196.56 against Bergs, $29,991 attorney fees, and $14,346.55 costs, with interest at 10%.
McInerney and Hoffers were awarded $278,521.81 damages against Bergs, and the District recovered $912.50 costs against McInerney and Hoffers.

Fired Gallatin County deputy settles civil cases for $400K

Written by: Whitney Bermes, Bozeman Daily Chronicle

A former Gallatin County sheriff’s deputy, who a judge ordered to be reinstated after being fired in 2014, has settled his civil lawsuits against the county, agreeing to not come back to the department after receiving a settlement.

Gallatin County agreed to pay David Johnston $400,000 to settle his actions against the county.

Johnston sued the county following his firing, asking to be reinstated. Following a three-day trial in 2015, District Judge Brenda Gilbert of Park and Sweet Grass counties reinstated Johnston and ordered the county to pay him more than $125,000 in lost salary and benefits.

The county appealed the decision to the Montana Supreme Court. In the meantime, Johnston filed additional claims against the county in federal court.

This month, the parties settled all the suits with the county agreeing to pay $400,000. As part of the agreement, Johnston agreed to never seek reinstatement with the sheriff’s office.

Johnston was fired in 2014 after sheriff’s office administrators say he refused to turn over a tape recorder after Gallatin County Sheriff Brian Gootkin ordered him to immediately return it.

On that tape recorder was an interaction Johnston had with Deputy Kelly Munter, his ex-girlfriend. He claimed she became angry with him and berated him while the two responded to a call at Monforton School in July 2014.

Munter later filed a complaint against Johnston that led to Johnston being placed on administrative leave.

Two days after Johnston was put on leave, Lt. Jake Wagner requested that Johnston turn over his tape recorder. Johnston said he wanted to seek advice from an attorney first and make a copy prior to turning it over to Wagner.

That same day, accompanied by an attorney, Johnston returned the recorder to the sheriff’s office after making a copy of the audio for himself.

Later that month, following a disciplinary hearing, Johnston was fired.

During the trial, Gootkin testified that the recorder was county property that needed to be returned as soon as possible. But Johnston refused to comply with Gootkin’s order, the sheriff said.

And it is important for his deputies to follow Gootkin’s orders because the sheriff’s office is entrusted to the public, Gootkin testified.

“We have a huge responsibility to the people we serve. When you violate that trust, whether it be lying or disobeying an order,” Gootkin said, “I can’t allow that to occur.”

Johnston’s attorney, Todd Shea, on the other hand, argued that Johnston’s firing was a “punishment (that) simply didn’t fit this crime” and that Johnston was entitled to get a copy of the recorder’s contents.

The firing was “cooked up” by the sheriff’s office command staff as a way to get rid of Johnston, who had prior bad incidents with Munter following their breakup, Shea said.
Judge Gilbert sided with Johnston, saying Johnston’s firing was contrary to sheriff’s office policies and state law.

Johnston didn’t refuse to comply with the sheriff’s order, but rather made it clear that he wanted legal advice prior to giving the recorder back to the sheriff’s office.

“Johnston’s short delay in compliance with the sheriff’s order, under the circumstances presented to Johnston, do not equate with a refusal to comply with the order,” Gilbert wrote in her ruling.

And Johnston, a 10-year veteran in the Gallatin County Sheriff’s Office, was fired after a 10-20 minute hearing where no testimony was presented. Additionally, Gilbert noted the order that Johnston was accused of violating was given by Gootkin, who also conducted the disciplinary hearing and who testified that he was “upset, emotional and mad” during both Johnston’s disciplinary hearing and termination meeting.

“The termination hearing that resulted in Johnson’s termination does not pass muster in terms of basic due process rights afforded to any individual facing the potential loss of his or her livelihood,” Gilbert wrote.

Calvin Stacey, a Billings attorney who represented the county during the case, was out of town and unavailable to comment Thursday. Shea declined to comment on the settlement.

$100,000 Settlement and Dismissed DUI Homicide

Source: Montana Law Week

Michael Soule, 44, was charged with vehicular homicide while DUI following the death of his wife Jennifer, 37, in a crash on I-90 west of Bozeman 1/25/12. The State alleged that he was driving a pickup up to 103 mph with BAC .231 when he crashed into a guardrail, and that he had marijuana and cocaine in his system. He pled nolo in exchange for 10 years probation. Judge Salvagni rejected the agreement and he pled not guilty. Salvagni later dismissed the case after ruling that investigators failed to preserve key evidence including a hair consistent with Jennifer’s that was photographed near the driver’s door and recordings of witness interviews and DNA evidence from the driver’s side dash, which could have been used to rebut the State’s theory that he was driving and that Jennifer was ejected from the sunroof. He also ruled that the probable cause affidavit omitted that Jennifer’s and Soule’s DNA were both on the driver’s airbag but only Soule’s was on the passenger airbag, a hair consistent with Jennifer’s hair was on the driver’s door, no fingerprints were recovered from the keys or steering wheel that could have indicated who was driving, no witnesses could identify who was driving, neither Soule nor Jennifer was belted, and both were found outside the vehicle. He also concluded that troopers conducted warrantless searches & seizures in Soule’s hospital room the morning of the crash while he was unconscious and without permission from his family or hospital staff including obtaining health care information, removing his gown & sheet, examining his body, and taking photos of his injuries and personal items. While a urine screening at the hospital tested positive for marijuana & cocaine, a confirmation test was never done and his BAC was never tested for those drugs. The Crime Lab blood draw test indicated .07 BAC and the marijuana in his system was also below the legal limit for medical marijuana cardholders, which Soule was. Soule was represented by Al Avignone in the criminal case.

Soule sued the MHP, AG Fox, Gallatin Co. Atty. Lambert, former Gallatin Co. Chief Dep. Atty. Whipple, and Troopers Josh Brown, Glen Barcus, Josh Giddings, Patrick McCarthy, and Ace Meskimen alleging negligence, malicious prosecution, violation of constitutional rights, IIED, and NIED. The case settled for $100,000 by the Shea Law Firm.

Additional Resources:

Bozeman Chronicle Article