                                          No. 97-472

               IN THE SUPREME COURT OF THE STATE OF MONTANA

                                         1998 MT 259


DARLEXE M, VINCELETTE,

              Plaintiff and Appellant,

         v.

METROPOLITAN LIFE INSURANCE COMPANY, and
BILLINGS SHERATON HOTEL,

              Defendants and Respondents



APPEAL FROM:         District Court of the Thirteenth Judicial District,
                     In and for the County of Yellowstone,
                     The Honorable G. Todd Baugh, Judge presiding.


COUNSEL OF RECORD:

              For Appellant:

                     Frank B. Morrison, Jr.; Morrisons, McCarthy & Baraban;
                     Whitefish. Montana

                     Randy S. Laedeke, Laedeke Law Office, Billings, Montana

              For Respondents:

                     Calvin J. Stacey, Stacey & Walen, Billings, Montana


                                                           Submitted on Briefs: August 13, I998

                                                                       Decided: October 30, 1998

Filed:
Justice Terry N. Trieweiler delivered the opinion of the Court.

71     The plaintiff, Darlene M. Vincelette, commenced this action in the District Court for

the Thirteenth Judicial District in Yellowstone County to recover damages for personal

injunes sustained while a guest of the defendant, Billings Sheraton Hotel. Following a jury

trial, a verdict was rctuincd for the hotel. Darlene appeals from the judgment entered

pursuant to that verdict and from the denial of her motion for a new trial. We reverse the

judgment of the District Court and remand for further proceedings.

72
 1     The issues presented on appeal are:

113    1.     Did the District Court abuse its discretion when it allowed a witness to testify

about out-of-court statements made by an unidentified declarant?

14     2.     Did the District Court abuse its discretion when it refused to admit photographs

offered as dcmonshative evidence?

75     3.     Did the Distr~ctCourt err when it denied plaintiff's motion to compel

discovery?

                               FACTUAL BACKGROUND

76     Around midnight on March 19 or 20, 1989, Darlene Vincelette fell while entering the

Billings Sheraton Hotel. She and her companion had passed through the outer doors leading

to the hotel lobby and were crossing over a carpeted entryway. Darlene took a step backward

to allow her companion to open one of the inner doors. As she did so, she fell and injured

her back.
17     Darlene asserts that the cause of the fall was either a defect in the carpeting or

negligent maintenance of the carpeting. The hotel denied any defect or neghgence. It

alleged that Darlene was intoxicated and that her condition was the cause of her fall.

718    Darlene moved the District Court prior to trial for an order excluding testimony from

hotel employees that they had been told Darlene was drunk. The District Court did not rule

on the mot~on.

19     At trial, one of the hotel's maintenance engineers was allowed to testify that he had

received a radio call from another hotel employee, who stated that Darlene was drunk.

Plaintifrs counsel moved to strike the testimony as hearsay, but the motion was denied. The

dcclarant was never identifi cd nor produced as a witness.

710    The District Court also refused to allow Darlene to admit photographs of the

entryway, taken seven years after the accident, which were offered to illustrate the testimony

of several witnesses regarding the condition of the carpet.

                                          ISSUE 1

711    Did the District Court abuse its discretion when it allowed a witness to testify about

out-of-court statements made by an unidentified declarant?

1/12   We review evidentiary rulings for an abuse of discretion. The district court has broad

discretion to determine whether or not evidence is relevant and admissible pursuant to the

Montana Rules of Evidence. Absent a showmg of an abuse of discretion, the trial court's
determination will not be overturned. See State v. Passama (1993), 261 Mont. 338,341, 863

P.2d 378,380 (citing State v. Crist (1992), 253 Mont. 442,445, 833 P.2d 1052, 1054).

113    Darlene alleged that the cause of her fall was the condition of the hotel carpeting,

causcd by improper maintenance. As a defense, the hotel asserted that there was nothing

wrong with the carpeting, but that Darlene's intoxication was the cause of her fall. Prior to

trial, Darlene filed a motion in limine to exclude testimony from hotel employees that they

were told the plaintiff was drunk. The District Court did not rule on the motion, but stated

that it would make a decision at trial, once a foundation for the testimony existed.

7/14   At trial, Darlene called Larry Vandenbosch, a maintenance engineer on duty at the

hotel the night of her accident, as an adverse witness. On direct examination, Mr.

Vandenbosch testified that he received a report by radio that a woman had fallen in the

entryway. He then went to investigate, but the enhyway and lobby were empty when he

arrived. He further testified that upon his arrival he examined the entryway carpeting.

715    On cross-examination, counsel for the hotel asked Vandenbosch what "information"

the radio caller gave him. Vandenbosch then testified that he was told a woman had fallen

in the entryway and that she was drunk. He could not remember who placed the radio call,

and the unidentified caller did not testify at trial.

7/16   Darlene moved to strike the statement that she was drunk on the basis that it was

hearsay. The District Court allowed the statement on the basis that it was not offered for the
truth of the matter asserted, but "n~erely reflect what was said to him and therefore it's not
                                         to

hearsay."

7 17   Following the ruling. the hotel again elicited testimony from Vandenbosch that he had

been told Darlene was drunk. Then, in closing argument, counsel for the hotel repeated the

tcstimony.

71 8   On appeal, Darlene contends the out-of-court statement was offered to show that her

fall resulted from intoxication rather than a defect in the carpeting. The hotel contends that

the tcstirnony was not hearsay because it was not offered to prove the truth of the matter

asserted, but to show its effect on the witness's state of mind and to show why he went to the

entryway to investigate.

719    Hearsay is a statement, other than one made by the declarant while testifying at the

trial, offered in evidence to prove the truth of the matter asserted. See Rule 801(c),

M.R.Evid. Hcarsay is not adnlissible except as provided by the rules of evidence. See Rule

802, M.R.Evid. A statement does not fit within the definition of hearsay when it is not

offered to prote the truth of the matter asserted, but to show the resulting effect on the

witness's state of mind. See Mannix   1
                                      :   Butte Water Co. (1993), 259 Mont. 79, 86, 854 P.2d

834,838; Moats Trucking Co v. Gallatin Dairies (19881,231 Mont. 474,479,753 P.2d 883,

886.

720    In Moats, the plamtiff trucking firm brought an action for breach of contract and

brcach of the covenant of good faith and fair dealing when the defendant dairy company
terminated a hauling contract with forty-eight days' notice. The district court allowed one

of the defendant's employees to explain why notice was not given immediately when the

decision was made to terminate the contract by relating an out-of-court conversation with

another employee, who expressed concern that the plaintiff would terminate services

immediately upon being advised that its contract was being terminated. The district court

held that the out-of-court conversation was not admitted to prove that the plaintiff would

actually have terminated services immediately, but to show the effect that it had on the state

of mind of the defendant's employee. Prior to allowing the testimony, the district court

cautioned the juiy that the party's testimony was admitted only for the purpose of showing

that the statements were made, not for proving that they were true. We affirmed the ruling

of the district court on that basis. See Moars, 231 Mont. at 479, 753 P.2d at 886.

721    Here, there is no similar purpose for admitting an out-of-court statement about

Darlcnc's intoxication.    The testimony that a woman had fallen, offered on direct

exammation, served to show why Vandenbosch went to the entryway and examined the

carpeting. Thc specific statement that the woman was drunk had no bearing on his decision

to investigate. The statement served no other purpose than to prove that Darlene fell because

she was drunk, and is more analogous to the hearsay testimony offered in Mannix.

1/22   In Mrttzrzlx, the plaintiff brought an action for wrongful termination of employnlent

after he was discharged for his initial refusal to follow, and later criticism of, a company

d~recttve.He sought to introduce testimony from other employees of the same company
regarding the transaction u hich led to his discharge. He argued that the out-of-court

statements were offered to prove his state of mind and, therefore, were not hearsay pursuant

to our decision in Moats. The district court disagreed, and we affirmed on the basis that the

statements were, in fact, offered to prove his employer's conduct and, therefore, for the truth

of what was asserted. See .Mamix, 259 Mont. at 86-87,854 P.2d at 839.

Ti23   Here, the hotel's argument that Vandenbosch's testimony was not offered to prow the

truth of what was asserted is belied by the fact that the hotel's defense was based on its

contention that Darlene mas intoxicated.       The evidence the hotel sought to present,

suggesting that Darlene was chink, was an out-of-court statement offered to prove the truth

of what was asserted, and was inadmissible hearsay pursuant to Rules 801(c) and 802,

M.R.Evid. We conclude that the District Court erred when it allowed the hearsay testimony.

724    For crror to be the basis for a new trial, it must affect the substantial rights of the

appellant. See Rule 61, M.R.Civ.P. Because of the inflammatory nature of the evidence, and

Darlene's complete inability to test its reliability by cross-examination, we conclude that the

evidence did affect Darlene's substantial rights and was prejudicial. For this reason, we

reverse the judgment of the District Court and remand for a new trial.

                                          ISSUE 2

125    Did the District Court abuse its discretion when it refused to admit photographs

offered as demonstrative evtdence?
726    We review the admission of demonstrative evidence for a manifest abuse of

discretion. See Cowles v. Slzeeline (1993), 259 Mont. 1, 12-13, 855 P.2d 93, 100; Pal~tzer
                                                                                         by

Diacon v. Furniers Ins. Excfz. (1988), 233 Mont. 515, 522-23. 761 P.2d 401,406.

127    At trial, Darlene sought several times to admit photographs of the hotel entryway

taken seven years after the accident. The photos depicted missing strips of carpeting and

corners of carpet tiles which were sticking up. The hotel objected to the admission of the

photographs on the basis that due to the passage of time, wear and tear, and a change in

ownership, the conditions they depicted were more prejudicial than probative. It also

objected on the grounds that Darlene alleged her fall was caused by a hole in the carpeting,

while the photos depicted other types of defects. Darlene contends the photographs were

relevant because they served to demonstrate the effect of wear and tear and improper

maintenance on the carpeting.

128    Generally. all relevant evidence is admissible and that which is not relevant is not

admissible. See Rule 402, M.R.Evid. Although relevant, evidence may be excluded if its

probative value is substantially outweighed by the danger of unfair prejudice, confusion of

the issue, misleading the jury, or by considerations of undue delay, waste of time, or needless

presentation of cumulative material. See Rule 403, M.R.Evid.

729    If relcvant, demonstrative exhibits are admissible to supplement a witness's spoken

description of the event and to clariff some issue in the case, if they are more probative than

prejudicial. See Codes, 259 Mont. at 12, 855 P.2d at 100 (citing Palmer, 233 Mont. at
522-23, 761 P.2d at 406).     By contrast, "they are inadmissible only when they do not

illustrate or make clearer some issue in the case; that is, where they are irrelevant or

immaterial, or where they are of such a character as to prejudice the jury." Cowles, 259

Mont. at 13, 855 P.2d at 100 (citing Workman v. Mcliztyre Const. Co. (1980), 190 Mont. 5,

24,617 P.2d 1281, 1291).

1/30   Here, the parties stipulated that the photos were taken seven years after the accident.

The District Court heard testimony from a witness responsible for cleaning the carpeting at

the time of the accident, through whom Darlene had attempted to introduce the photos, and

concluded that the caipeting, as depicted, was sufficiently different &om the time of the

accident that the photos should not be admitted. The District Court also concluded that the

photos were not relevant because they depicted defects of a different nature than those

alleged by Darlene.

731    Given the length of time between the accident and the photographs, as well as the

change in the condition of the carpeting, we conclude that the District Court did not abuse

its discretion when it refused to admit the photographs.

                                          ISSUE 3

732    Did the District Court err when it denied Plaintiffs motion to compel discovery?

733    Because we have remanded this case for a new trial, we presume that a new discovery

schedule will be established and that the parties will have the opportunity to complete any
discovery they consider necessary. Thcrefore, we deem it unnecessary to decide the

discovery issues presented on appeal.

734    We rcvcrse the judgment of the District Court and remand for further proceedings

consistent with this opinion.




Wc Concur:




             Justices
Justice Karla M. Gray specially concurs and dissents.


735    I concur in the Court's opinion on issue 2, which holds that the District Court did not

abuse its discretion when it refused to admit photographs offered as demonstrati\re evidence.

I dissent from the opinion on issue 1 and, for that reason, I would not remand for a new trial.

As a further consequence of my dissent, I would address issue 3 and hold that the District

Court did not abuse its discretion in denying Darlene's motion to compel discovery.

736    With regard to issue 1, I agree with the Court that the pertinent questions are 1)

whether the District Court abused its discretion in admitting Vandenbosch's testimony on

cross-examination that the radio caller told him that the woman who had fallen was drunk;

and 2) if so, whether the admission of that testimony materially affected Darlene's substantial

rights. I also agree with the Court's conclusion that the District Court abused its discretion

in admitting the hearsay testimony. It is my view, however, that the Court is wrong--and

clearly wrong--in holding that Darlene's substantial rights were affected, thereby entitling her

to a new trial.

737    The Court's conclusion that Darlene's substantial rights were affected by admission

of part of Vandenbosch's testimony and by the reference to it in closing argument by defense

counsel is based on far too limited a review of the record before us, a review which would

lead the reader to conclude that Vandenbosch's reference was the only testimony regarding

whether Darlene had been drinking before her fall at the Sheraton. Nothing could be further

from the truth.

138    The controlling pretrial order in this case reflects that Darlene contended the Sheraton
and its insurer were negligent and that their negligence resulted in serious and permanent

injury to her back and legs. The defendants contended, in turn, that they were not negligent

in any fashion. They further contended that, assuming some negligence on their part was

found, their negligence was not a cause of any damages and/or injuries sustained by Darlene.

Finally, they contended that Darlene was negligent and that her negligence contributed to the

cause of her damages and/or injuries. The case proceeded to trial on the basis of the pretrial

order.

5/39     Darlene's counsel's opening statement to the jury was brief. The Sheraton's opening

statement tracked through most of the evidence it expected to be presented during the trial.

It referenced Darlene's and her companion's coming testimony that they had been out

dancing, socializing and having a few drinks on the evening in question. Counsel also noted

that Darlene would testify that the total of 3 to 4 rum and Diet Cokes she consumed that

night--without having any food--did not have anything to do with her fall. Counsel made no

mention of any coming testimony by Vandenbosch that the radio caller said the woman who

fell was hunk.

5/40     The 4-day trial proceeded much as outlined by the Sheraton's counsel in his opening

statement, including the testimony about Darlene and her companion having a number of

drinks on the night of her fall. The testimony also rncluded, of course, Vandenbosch's

inadmissible hearsay testimony referenced above.

5/41     In closing arguments, Darlene's counsel recounted her testimony that she had been out

dancing and socializing and having a few drinks on the evening in question. He argued that

the Sheraton was negligent and that, if the hole had not existed in the carpet, she would not

                                              12
have fallen. Darlene's counsel also argued,

       That evening--if she was drunk, and she wasn't--and she stepped in that hole
       and fell over backwards they would still be liable. If she was drunk, that's not
       a defense [to the Sheraton's ncgligencc].

Thus, Darlene's counsel addressed the matter of her drinking directly in his closing argument,

no doubt recognizing that it was necessary to do so because of the testimony of Darlene and

her companion regarding their activities that evening.

142    The closing argument by counsel for the Sheraton runs to nearly 30 pages of

transcript. It centered primarily on the lack of proof advanced by Darlene as to any

negligence, but also noted that the Sheraton had raised as a defense that Darlene was at fault

in the fall. Counsel then made a I-sentence reference to the portion of Vandenbosch's

testimony about which Darlene complains on appeal: "He had heard that there was some

woman who had been drinking." That was the extent of counsel's reference to Darlene's

drinking on the night in question and, of course, Vandenbosch's testimony aside, Darlene

had admitted that she had, in fact, been drinking that night.

143    Finally, the record reflects that this case went to the jury on a Special Verdict form

of a relatively common type. The first question thereon was "Were the defendants

negligent?" The second question, "Was the negligence of the defendants a legal cause of

Plaintiffs' [sic] damages?" The third question, "Was the Plaintiff negligent'?" As is usual in

this type of special verdict form, the jury was instructed to answer yes or no to the first

question and, if it answered "no," to date and sign the Special Verdict. Indeed, that is what

the jury did: it answered the first question--regarding w-hetherthe defendants were negligent-

-"No" and that was the end of the jury's deliberations. In other words, the jury did not reach

                                              13
the causation question or the comparative negligence question.

1/44   I submit that, on this record, it is impossible to conclude that Darlene's substantial

rights were affected by Vandenbosch's testimony about the remainder of the radio call he

received. In the context of the other evidence, including Darlene's own testimony about

drinking that night, Vandenbosch's testimony and defense counsel's 1-sentence reference to

it in a 30-page closing argument, simply was not--as the Court characterizes it--

"inflammatory" and "prejudicial."

1/45   Moreover, since the jury resolved the case by finding that the defendants were not

negligent and did not reach the Special Verdict questions to which the extent of Darlene's

drinking were relevant--namely, causation and comparative negligence--it cannot be said that

Darlene's substantial nights were affected by the erroneous admission of a small part of

Vandenbosch's testimony. Indeed, we recently addressed a similar situation in Pcschke v.

Carroll College (1996), 280 Mont. 331, 929 P.2d 874. There, we concluded that the trial

court had abused its discretion in admitting a videotape into evidence. We further concluded,

however, that the plaintiffs substantial rights were not materially affected because the

evidence went to the issue of causation \qhich the jury had not reached because of its

threshold finding that the college was not negligent, and held that the error was harmless.

 Peschke, 280 Mont. at 342-43, 929 P.2d at 881. Pesclzke clearly controls the proper

resolution of issue 1 in the present case.

746    On issue 1, I would hold that Darlene's substantial rights wcre not materially affected

by the erroneous admission of hearsay evidence and, as a result, that the error was harmless.

Thus, I would affirm the District Court's denial of Darlene's motion for a new trial.

                                             14
1/47   Finally, as noted above, I also would affirm the District Court's denial of Darlene's

motion to compel discovery. Our cases holding that trial courts have broad discretion in

discovery-related matters are legion and require no citation. Darlene simply has not

established an abuse of discretion by the District Court in that regard.

748    I would affirm the District Court on all issues raised by Darlene on appeal and I

dissent from the Court's failure to do so.
                                        October 30, 1998


                                  CERTIFICATE OF SERVICE

I herebq certifq that the following certified order was sent by United States mail. prepaid, to the
following named:
FRANK B ?AORRISON JR
MORRISONS MCCARTHY AND BARABAK
PO BOX 1090
WHITEFISH MT 59937-1090

RANDY S LAEDEKE
LAEDEKE LAW OFFICE
PO BOX 2216
BILLINGS MT 59103-22 16

CALVIN 3 STACEY
ATTORUEY AT LA'&
PO BOX 1139
BILLlNGS h17 59103-1 139



                                                     ED SMITH
                                                     CLERK OF THE SIJPREME COURT

                                                     STATE OF 'MONTANA
                                                                 1,
                                                     BY:         $I
                                                                  --
                                                     Deputy      '
