               IN THE SUPREME COURT OF THE STATE OF MONTANA




-   DANIEL MASSE and JUSTINE
    MASSE, husband and wife,
         Plaintiffs and Respondents,


                       -
    THE STATE OF MONTANA
    DEPARTMENT OF HIGHWAYS,
         Defendant and Appellant.
                                -
                                O R D E R


         The Court has fully considered petition for rehearing
    filed by the State of Montana Department of Highways, and
    being fully advised finds that a correction should be made in
    the opinion originally issued.
         The     opinion   entitled   Masse   v.   State    of   Montana

    Department of Highways published at 40 St.Rep. 730 should be

    corrected so that the fifth paragraph on page 733 of the
    opinion reads as follows:
        "The cause of action is one for negligence.      The
        applicable statute of li-mitations is three years.
        Section   27-2-204 (1), MCA.      The    statute  of
        limitations commences to run when the cause accrues
        or, at the latest, on the date of discovery.
        Thompson v. Nebraska Mobile Homes Corp. (1982),
               Mont. --I          , 647 P . 2 d 334, 338, 39
        St.Rep. 3.094, 1100. On remand, findings should be
        made regarding the date the Masses discovered facts
        which would give rise to a cause of action against
        the Department of Highways.     Then, a conclusion
        should be drawn as to whether or not the original
        complaint was filed within three year-s of the date
        of discovery of facts which did, or through the
        exercise of reasonable care should have, apprised
        the Masses of the accrual of a cause of action
        against the Department of Highways."

        As amended the opinion is approved and the petition for
    a rehearing is denied.


                                            Chief Justice

                                                             Y   I   \
                                           !do.    82--255

                 I N THE SUPREPIE COURT O F THE STATE O FO J A A
                                                       F I 1T N

                                                   1983




DANIEL lV1ASSF AND JUSTINE ,RIASSF,
Husband b W i f e ,

                 P l a i n t i f f and R e s p o n s - e n t ,



TI-IE STATE O F M TT T A
                 OJA4       , DEPF_RT.'?IENT
             ,
O E I GPIFZAY S
 F i

                 D e r e n d a n t and A p p e l l a n t .




Appeal from:     D i s t r i c t Court of t h e Fourth J u d i c i a l D i s t r i c t ,
                 I n a n d f o r t h e County o f M l s s o u l a , The H o n o r a b l e
                 J o h n S, Henson, J u d g e p r e s i d i n g .


Counsel of Record:

         For Appellant:

                 R e a t e G a l d a , D e p t . of ETighways, FTelena, Montana

         For Respondent:

                 T e r r y ?q?allace, F l i s s o u l a , Montana


                                                          -                    ----    --        ---
                                            Submitted on B r ~ e f s : March 3 , 1 9 9 3

                                                                 Decided:   Clay 1 9 , 1 9 8 3



Filed:   MAY 1 9 1983

                                                                  - ---
                                            Clerk
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of
the Court.
     An amended judgment was issued by the Fourth Judicial
District Court on April 2, 1982, establishing the common
boundary line between property owned by the Masses and a
right-of-way belonging to the Montana Department of Highways.
It also found that a negligent act by the Department of
Highways proximately          caused uncertainty          regarding Masses'
property line and awarded Masses $28,368.56 in damages, plus
interest thereon at the rate of ten percent (10%) per annum.
The Montana Department of Highways now appeals that amended
judgment.       We reverse and remand for a new trial.
     Daniel and Justine Masse were owners of real property
located in Section 22, Township 12 North, Range 17 West,
M.P.M.     in    Missoula     County    near     Clinton, Montana.         An
interstate highway project, Clinton                 -   East and West, was
built     in    that   area    from     1970   to       1972   by   Washington
Construction, a contractor for the Department of Highways.
     During construction of the interstate, The Department of
Highways' project manager and his crew staked locations along
newly     acquired     right-of-way        for      later      placement   of
right-of-way      monuments     by     Washington       Construction.      The
Department acquired new right-of-way from Masses' neighbor to
the east, John Stitt, but acquired no new right-of-way from
the Masses.      Nevertheless, in October of 1972, a right-of-way
monument was placed at the site of a stake on the Masse
property at the section line between Sections 21 and 22.                    It
was placed approximately three feet inside the existing fence
bordering the Masses' property.
        In March of 1973, the Masses entered into an agreement
with a real estate broker, Arthur J. Rapp, to sell their
property.
     The survey firm of Ainsworth and Associates was hired in
July of 1973 to resurvey the Masse property.                     Ignoring other
survey monuments on the property, the survey crew utilized a
right-of-way monument on the Stitt-Masse property boundary
line and     the   right-of-way monument on                the    section line
between sections 21 and 22 to conduct their survey.                   The crew
determined    that    the   Masse        property    encroached      upon    the
Department of Highway's           right-of-way.            Specifically, the
right-of-way boundary went across the porch of the Masses'
business, Poor Henry's            Bar.      The     listing agreement was
voluntarily cancelled by both parties upon discovery of the
encroachment.
     Mr.   Rapp      testified     at     trial     that    there    had    been
prospective buyers of the Masse property and that he had been
confident that he would find a ready, willing and able buyer.
No exact fair market value for the property was given.
     Mrs. Masse testified that an $85,000 cash sale of the
property was lost because of the boundary uncertainty.                       She
also testified that the interest rate at that time was seven
or eight percent.       Mr. Masse testified that the property was
offered for sale at $125,000 and that he had received several
informal offers to buy.           He believes he could have sold the
property at that time had it not been for the boundary
dispute.
    After completion of the Ainsworth survey, Mr. Ilasse
traveled to Helena to discuss the boundary problem with
representatives       of    the    Department        of    Highways.        The
right-of-way monument on the section line between Sections 21
and 22 on the Masse property, was removed by the Department
of Highways on August 7, 1973.              Mr. Masse contends that the
removal of the monument increased the confusion over his
boundary line.
       Pursuant to an agreement between the Masses and the
Department of Highways, Charles W. Hegman, project manager
and land surveyor with the Department of Highways, resurveyed
the highway right-of-way in the spring of 1975.                The survey
was filed in February of 1976 as Certificate of Survey No.
777.    That survey showed no property belonging to the Masses
encroaching upon the highway right-of-way.            The right-of-way
line was three feet south of the porch of Poor Henry's Bar.
       Although the Department of Highways apparently considers
Certificate of Survey No. 777 to accurately represent the
highway right-of-way, the State of Montana has refused to
acknowledge that line as the boundary between the highway
right-of-way      and     Masses'   property.      Another    survey   was
conducted by       Mr.    Hegman    in   1981 at the request of the
Department of       Highways.        The Masses'    boundary    line was
determined to lie approximately 3% feet north of the highway
right-of-way.
       The Masses sold part of their property in December 1976
for $142,111.         The sale was based on the 1973 Ainsworth
survey and subject to the pending right-of-way dispute.
       Masses     filed   a   complaint against the Department of
Highways on October 19, 1977, alleging that the Department
and    its   agents      "illegally confiscated, claimed        and used
property     of    the    Plaintiffs."      The    complaint    requested
compensation for loss of interest on frustrated sales, loss
of the value of land illegally confiscated, loss due to
illegal and continuing trespass, and other expenses.
       Trial was held before a district judge on February 17
and 18, October 5 and 19, and December 1, 1981.              At the close
of their case-in-chief, October 19, 1981, Masses moved for
leave to amend the pleadings to conform to the evidence.               The
Department of       Highways responded by         raising    statutes of
limitations and sovereign immunity defenses.        The motion to
amend the pleadings was granted and the cause of action
became one in negligence.
      Forty-four findings of fact and eleven conclusions of
law were     issued by   the trial court on January 8, 1 9 8 2 .
Pursuant to a motion to amend by the Department of Highways,
amended findings of fact, conclusions of law and judgment for
Masses were entered April 2,        1982.   The amended judgment
established the boundary line shown in Certificate of Survey
No.   777   as the correct boundary line between the Masses'
property and the Department of Highways' right-of-way.
      The Department of Highways was found to have negligently
and erroneously placed a right-of-way monument on the section
line between Section 2 1 and 2 2 on Masses1 property.        That
negligent act was found to be the proximate cause of the
uncertainty of Masses' boundary line.       The uncertainty in the
boundary line was found to be the proximate cause of lost
sales of Masses' property. Masses were awarded compensation
representing their lost interest payments on a potential 1 9 7 3
contract for sale of their property and expenses accrued in
resolving the boundary dispute.
      The Department of Highways raises the following issues
in this appeal of the judgment:
      1.    The District Court erred in finding the defendant
            liable for damages.
            A.   The plaintiffs' causes of action sounding in
                 tort are barred by the statute of limitations
                 and sovereign immunity.
            B.   The remaining causes of action are unsupported
                 by the evidence.
      2.    The District Court's findings of fact and conclu-
            sions of law are not supported by the evidence.
     3.      The evidence does not support the damages awarded
             by the District Court.
     We reverse and remand for a new trial on the statute of
limitations defense and the damages issue.
     The     Department      of     Highways         raised        a    statute    of
limitations defense at trial.                 The trial court did not
address the defense when it was raised or in its findings of
fact and conclusions of law.             We are unable to determine why
the trial court considered the statute of limitations not to
have run prior to the filing of the original complaint on
October 19, 1977.
     The     cause    of   action    is    one       for   negligence.             The
applicable statute of limitations is three years.                             Section
27-2-204 (1), MCA.         The statute of limitations commences to
run when the cause accrues or, at the latest, on the date of
discovery of the cause of action.                     Thompson v.            Nebraska
Mobile Homes Corp. (1982),               Mont   .-
                                                 1         -,          647 P.2d 334,
338, 39 St.Rep.       1094, 1100.        On remand, findings should be
made regarding the date the Masses discovered they had a
cause of action against the Department of Highways.                           Then, a
conclusion should be drawn as to whether or not the original
complaint was        filed within        three       years of          the date of
discovery.
     The     Department      of    Highways         alleges    that          seventeen
findings of        fact    and    nine   conclusions          of       law   are   not
supported by the evidence.           "The function of this Court is to
determine whether there is sufficient evidence to support the
district court's findings and those findings will not be set
aside unless there is a clear preponderance of evidence
against them. l1     Kearns v. McIntyre Construction Co. (1977),
173 Mont. 239, 249, 567 P.2d 433, 438.                 We have reviewed the
record and have found either harmless error or sufficient
evidence to support each of the findings except the one
pertaining to damages.
     There was insufficient evidence in the record to support
the District Court's     finding that Masses lost a $125,000
contract sale of     their property because of   the boundary
dispute.     On   remand, Masses must   show that they had   a
prospective buyer who would have purchased their property for
a specified price but for the boundary dispute or otherwise
present damage testimony which supports the trial court's
findings.
    Finally, the District Court improperly awarded Masses
interest on this judgment.   Section 2-9-317, MCA.
     Reversed and remanded for ne



We concur:



Chief Justice




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