                                              No. 14483

                   I N THE S P E E C O W O THE STATE O MXl?ANA
                            UR M          F           F

                                                   1979



STATE O M3NTANA, by & through its
       F
PUBLIC ErJPmYEES m1-     BOARD,

                              P l a i n t i f f and A p p l l a n t ,



HUMAN RIQTTS DIVISION et a l . ,
                              Defendants and Respondents.



Appeal f m :        D i s t r i c t C o u r t of the F i r s t J c d i c i a l D i s t r i c t ,
                    Honorable Peter G. Meloy, Judge presiding.

Counsel of Record:

    For Appellant :

         J. Michael Young argued, Dept. of A d m h . ,                         Helena, Plbntana

   For Respondents:

         Frederick F. S h W argued, Helena, Mntana
         Ibsemq Zion, Helena, Plbntana



                                                     Submitted:          March 22, 1979

                                                        Decided:         NGV 1 1B
                                                                                9
Filed:   rj -,:;
         fr
                    1 ~m
Mr. Justice Daniel J. Shea delivered the Opinion of the Court.

     The State of Montana Public Employees' Retirement Board
appeals from a decision of the Lewis and Clark County District
Court which held that the Human Rights Commission must first
exhaust its administrative remedies before seeking judicial
review.   In doing so, the District Court dismissed the request
of the Public Employees' Retirement Board for a mandatory
injunction or a declaratory judgment directed at the Human Rights
Commission.
     The essential issue with which we are concerned is whether
the law is clear on its face that the Human Rights Commission
has no subject matter jurisdiction to inquire into the validity
of sex-based survivor annuity mortality tables used by the
Public Employees' Retirement Board (hereafter referred to as
the Retirement Board).   The Retirement Board contends that
the Human Rights Commission is deprived of subject matter
jurisdiction because of an exemption written in section 4 9 -
3-103, MCA of the Human Rights Act.   The pertinent part of
this statute provides:
     "Nothing in this chapter shall prohibit any public
     or private employer:


     "(2) from observing the terms of a  ...  bona
     fide employee benefit plan such as a retirement,
     pension, or insurance plan which - -not a
                                      is -
     subterfuqe to evade the purposes of -
                                      - this chapter,
     . . ." ( ~ m s a s i s
                          added.)
     Based upon this statute, the Retirement Board argues
that it is immune from any inquiries by the Human Rights
Commission as to the conduct, operation or application of
its employee benefit retirement plans.
        The facts giving rise to this controversy are briefly
as follows.     Rose Stocks is the surviving spouse of a former
state employee, and as such is entitled to benefits under the
Public Employees' Retirement Act.      Through the Human Rights
Commission, she filed a complaint alleging that the sex-based
survivor mortality tables used by the Public Employees'
Retirement Plan are discriminatory.     The Human Rights Commission
investigated her complaint and later issued a finding of
probable cause, and issued a certification of hearing notifying
the Retirement Board that it had twenty days to answer this
complaint.
        Rather than doing so, however, the Retirement Board
brought suit in District Court seeking injunctive relief from
the pending administrative hearing.     The Retirement Board
sought an injunction against the Human Rights Commission on
the grounds that such agency had no subject matter jurisdiction
(based on section 49-3-103(2), MCA, supra,) and in the alter-
native, sought a declaratory judgment that the Human Rights
Commission had no subject matter jurisdiction.
        The controversy turns on the exemption provided for in
                                            --
section 49-3-103(2), MCA, and the language "bona fide
employee    .. .   retirement, pension" and "which is not a
                                             -----
subterfuge to evade the purposes - -
                                 of this chapter     . . ."
The Human Rights Commission argued that it has primary subject
matter jurisdiction to determine if a retirement plan is
either "bona fide" or is "a subterfuge     to evade the purposes"
of the Human Rights Act (sections 49-3-101 through 49-3-303,
MCA).    Moreover, the Human Rights Commission also argues
that the Retirement Board is not entitled to judicial review
because it had not exhausted its administrative remedies.
        The Retirement Board argues that section 49-3-103(2),
MCA, by its own terms deprives the Human Rights Commission
of subject matter jurisdiction over the state's employee
retirement benefit plan (PERS).   But the District Court did
not so conclude, and neither can we.
     Whether the Retirement Board's retirement plan was bona
fide or a subterfuge, was nothing that the District Court

could determine from the allegations made by the Retirement
Board.   In reading section 49-3-103(2), MCA, the District
Court declared in its order dismissing the suit:
     "The Court cannot make a determination whether
     PERS [Retirement Board] practices constitute
     a 'bona fide employee benefit plan' or a
     'subterfuge' on the facts now before it. Findings
     of fact in this specialized area are a matter for
     agency expertise  .. . The commission should have
     the first opportunity to determine whether PERS
     falls under the exemption."
    We see nothing in the arguments presented to this
Court that would lead us to come to a different conclusion
than the District Court.   Section 49-3-103(2), MCA, does
not on its face, deprive the Human Rights Commission of
subject matter jurisdiction.   Indeed, a reading of this
statute in conjunction with the entire Human Rights Act,
would lead to the conclusion that the Human Rights Commission
has a right, if not a duty, to determine if either a public
or private employee retirement plan is in good faith or
is a subterfuge used to evade the purposes of the Act.     There
is a complaint presently pending before the Human Rights
Commission, and there is a corresponding duty of the
Human Rights Commission to act on that complaint.   If the
retirement plan, together with its implementation, does not
constitute illegal sex-based discrimination, we can only
assume that the Human Rights Commission would so find.     If
not, the Retirement Board is not without a remedy at that
time to seek judicial review of a final determination made by
the Human Rights Commission.
     The decision of the District Court is affirmed.   This case

is remanded to the District Court with directions to send it
back to the administration agency f
                                  s   appropriate proceedings.




We Concur:



      Chief Justice




             Justices   L
                        '
