                                                                                             10/04/2016


                                            OP 16-0335
                                                                                        Case Number: OP 16-0335

                  IN THE SUPREME COURT OF THE STATE OF MONTANA

                                           2016 MT 245



GREAT FALLS CLINIC LLP,

              Petitioner,

         v.

MONTANA EIGHTH JUDICIAL DISTRICT
COURT, Cascade County, The Honorable
John A. Kutzman, Presiding Judge,

              Respondents.



APPEAL FROM:            District Court of the Eighth Judicial District,
                        In and For the County of Cascade, Cause No. BDV-15-118(C)
                        Honorable John A. Kutzman, Presiding Judge


COUNSEL OF RECORD:

                For Petitioner Great Falls Clinic:

                        Adam Warren (argued), Gerry Fagan, Moulton Bellingham PC,
                        Billings, Montana

                For Plaintiff Lisa Warrington:

                        Timothy J. McKittrick (argued), McKittrick Law Firm, P.C.,
                        Great Falls, Montana



                                                                Argued: August 31, 2016
                                                              Submitted: September 6, 2016
                                                               Decided: October 4, 2016


Filed:

                        __________________________________________
                                          Clerk
                               OPINION AND ORDER


¶1     The Great Falls Clinic petitions this Court to take supervisory control over the

District Court of the Eighth Judicial District and to reverse the Order on Cross Motions

for Summary Judgment dated April 25, 2016, in the case of Lisa Warrington v. Great

Falls Clinic, Cause No. BDV-15-118(C). We accept supervisory control and affirm the

District Court.

                  FACTUAL AND PROCEDURAL BACKGROUND

¶2     In 2014 Lisa Warrington had worked for Benefis Hospital (Benefis) in Great Falls

for about 20 years. On October 7, 2014, the Great Falls Clinic (Clinic) offered her a job

as clinical manager. The next day Warrington accepted the offer of employment and

gave two weeks’ notice to Benefis that she was leaving its employ after October 24. On

October 10, Warrington signed a written employment contract for an indefinite term with

the Clinic, and both agreed that her start date would be October 27, 2014. On October

24, Warrington’s last day at Benefis, the Clinic called and told her that it would not

employ her after all.

¶3     Warrington brought an action against the Clinic for breach of contract, promissory

estoppel, and breach of the covenant of good faith and fair dealing. The parties each

moved for summary judgment on the breach of contract and promissory estoppel claims.

The District Court granted Warrington’s motion for summary judgment on the breach of

contract claim and denied the Clinic’s motion.      The District Court found that the

Wrongful Discharge from Employment Act (Act) did not apply.


                                           2
¶4     On June 7, 2016, the Clinic petitioned this Court for a writ of supervisory control,

contending that the District Court made a serious mistake of law by concluding that the

Act does not apply to the relationship between Warrington and the Clinic.1 The Clinic

asserts that resolution of this legal issue will determine the ultimate outcome of the case

and must be resolved before the parties proceed to other issues such as damages.

¶5     This Court ordered a response from either the District Court or the plaintiff in the

underlying case.   On June 23, 2016, Warrington responded to the Clinic’s petition,

contending that the District Court’s order on summary judgment was correct and should

be upheld.   After reviewing the petition and the response, this Court ordered oral

argument, which occurred on August 31, 2016.

                              STANDARDS OF REVIEW

¶6     This Court has supervisory control over all other courts. Mont. Const. art. VII,

§ 2(2). Supervisory control is an extraordinary remedy and we determine whether to use

it on a case-by-case basis. M. R. App. P. 14(3). Acceptance of supervisory control is

limited to cases involving purely legal questions. Stokes v. Thirteenth Jud. Dist. Court,

2011 MT 182, ¶ 5, 361 Mont. 279, 259 P.3d 754. Promoting judicial economy and

avoiding “inevitable procedural entanglements” are appropriate reasons for exercising the

writ. Truman v. Eleventh Jud. Dist. Court, 2003 MT 91, ¶ 15, 315 Mont. 165, 68 P.3d

654.




1
  The District Court denied Warrington’s motion for summary judgment on the promissory
estoppel claim. Neither party seeks review of that ruling.
                                            3
¶7     We review a district court’s ruling on summary judgment de novo, to determine

whether it is correct, using the same standards as the district court under M. R. Civ. P. 56.

Revelation Industries v. St. Paul Fire & Marine, 2009 MT 123, ¶ 13, 350 Mont. 184, 206

P.3d 919.

                                      DISCUSSION

¶8     We have determined to accept the petition for supervisory control to resolve the

issue in this case as to whether the Wrongful Discharge from Employment Act applies to

the relationship between Warrington and the Clinic. This is purely an issue of law and its

resolution will shape the proceedings for the remainder of the case, including the legal

theory or theories under which Warrington may pursue her claim against the Clinic and

the determination of damages, if any. Settling this issue at the present time will further

judicial economy and will materially aid the parties.

¶9     The primary issue is whether the Montana Wrongful Discharge from Employment

Act, Title 39, chapter 2, MCA, applies to Warrington’s claims. The Clinic argues that the

Act applies, preempting Warrington’s common law claim for breach of contract and

limiting her remedies.    The District Court concluded that the Act did not apply to

Warrington’s relationship with the Clinic because she was never an employee of the

Clinic and therefore could not have been discharged. The District Court concluded that

Warrington and the Clinic were parties to an executory contract for future employment

and that an employer cannot discharge a person who is still employed somewhere else

and has not yet started to work for the employer. The Clinic contends that unless this

result is reversed the Act will be eviscerated and judicial resources wasted.

                                             4
¶10   The Act “provides the exclusive remedy for a wrongful discharge from

employment.” Blem v. St John’s Lutheran Hospital, 2010 MT 258, ¶¶ 18-19, 358 Mont.

300, 246 P.3d 1024; § 39-2-902, MCA. The Act preempts all common law remedies for

wrongful discharge, and precludes any discharge claim arising “from tort or express or

implied contract.” Section 39-2-913, MCA; Solle v. Western States Ins., 2000 MT 96,

¶ 12, 299 Mont. 237, 999 P.2d 328. The Act applies to an “employee,” who is “a person

who works for another for hire.” Section 39-2-903(3), MCA. The Act provides that a

“discharge” includes a constructive discharge (not involved in this case) and “any other

termination of employment.” If an employer has committed a wrongful discharge the

employee may be awarded wages and fringe benefits for a maximum of four years, less

any interim earnings. Section 39-2-905(1), MCA; Cromwell v. Victor School Dist., 2006

MT 171, ¶ 22, 333 Mont. 1, 140 P.3d 487. There is no right to damages for pain and

suffering, emotional distress, compensatory damages, punitive damages, or any other

form of damages except those provided in the Act. Section 39-2-905, MCA.

¶11   It is clear that Warrington and the Clinic had entered an executory contract as

found by the District Court. The Clinic’s written job offer, accepted by Warrington,

welcomed her to join them “as a Clinical Manager” at an annual compensation of

$78,500 plus benefits, with a start date to be determined. The Clinic established a

six-month probationary period “which begins on your first date of employment.” The

Clinic’s written offer to Warrington stated that “[W]e greatly look forward to having you

join the Clinic and become a member of our team.” At that time, and through October

24, 2014, Warrington was employed by Benefis.

                                           5
¶12    A contract requires identifiable parties capable of contracting; consent of the

parties; a lawful object; and sufficient consideration. Section 28-2-102, MCA. It was a

contract for future employment and as such was an executory contract, under which “a

party binds himself to do or not to do a particular thing in the future.” Winkel v. Family

Health Care, 205 Mont. 40, 45, 668 P.2d 208, 219 (1983). The executory contract here

was the agreement that the Clinic would employ Warrington starting October 27, 2014.

¶13    The Wrongful Discharge Act applies when an employer discharges an employee

from employment. Blem, ¶ 18.       None of those attributes applies to the relationship

between the Clinic and Warrington. When the Clinic breached the executory contract

Warrington was not employed by the Clinic because she had not yet started work and was

not entitled to any salary for having worked. As the District Court succinctly concluded,

Warrington “had not yet earned a dime working for the Clinic.” Because she was not an

employee, the Clinic could not discharge her from employment for purposes of the Act.

As the District Court concluded, “[b]ecause the Act applies only to a ‘discharge’ and not

to other types of employment claims, the ultimate legal question here is whether the

Clinic or any other employer can ‘discharge’ a person before their first day on the job.”

When the Clinic purportedly “discharged” Warrington she was still a full-time employee

of Benefis and had not yet become an employee of the Clinic. An “employee” is a

“person who works for another for hire.” Section 39-2-903(3), MCA.

¶14    We have held that § 39-2-913, MCA, “bars claims for discharge arising from tort

or implied or express contract, but does not bar all tort or contract claims merely because

they arise in the employment context.” Beasley v. Semitool, Inc., 258 Mont. 258, 262,

                                            6
853 P.2d 84, 86 (1993). This Court effectively disposed of the Clinic’s argument in

Blem, holding that a prospective employee’s probationary period does not begin upon

acceptance of an offer of employment, but rather begins when “the new employee

actually starts work.” This is especially true where the purportedly discharged employee

is “actually working for another employer” at the time. Blem, ¶ 16. The District Court

properly concluded that there “is simply no plausible interpretation of ‘employment’ at

the Clinic that would apply to Ms. Warrington’s status on October 25.”

¶15    We accept the petition for supervisory control. In doing so, we affirm the District

Court’s determination that the Wrongful Discharge From Employment Act does not

apply to the relationship between the Clinic and Warrington, and we affirm its order

granting summary judgment to Warrington on the breach of contract claim.

¶16    Further, costs can be awarded in extraordinary writs and original proceedings

under M. R. App. P. 19(3)(b)(iii), and will be assessed against the real party in interest,

rather than against the respondent district court. M. R. App. P. 19(3)(b)(ii).

¶17    IT IS HEREBY ORDERED that this matter is remanded to the District Court for

further proceedings consistent with this Opinion and Order.

¶18    IT IS FURTHER ORDERED that costs for this proceeding will be assessed

against Great Falls Clinic and awarded to Lisa Warrington, pursuant to M. R. App. P.

19(3)(b).

       DATED this 4th day of October, 2016.


                                                  /S/ MIKE McGRATH


                                             7
We Concur:

/S/ MICHAEL E WHEAT
/S/ PATRICIA COTTER
/S/ LAURIE McKINNON
/S/ BETH BAKER
/S/ JAMES JEREMIAH SHEA
/S/ JIM RICE




                          8
