Rahrer v. Board of Psychologists

RAHRER, SANDRA Appellant, Plaintiff and v.

BOARD OF PSYCHOLOGISTS, Department of Commerce, State

of Montana, Respondent. Defendant and 99-091. No. August 19, Submitted on Briefs 1999. January 13, Decided 2000 MT 9. St.Rep. 298 Mont. 28. 993 P.2d 680. Jewell, Michael G. Alterowitz and Monte Appellant:

For Offices, PC.; Law Missoula. Alterowitz Drake, Keller, Respondent: Reynolds, Drake,

For G. Curtis John- PC.; Gillespie, son & Helena. opinion

JUSTICE REGNIER delivered the of the Court. Psycholo- Dr. Sandra Rahrer filed an action the Board of (here- Commerce, gists, Department and the State of Montana “Board”) collectively inafter referred in the Fourth Judicial Dis- trict, County, for damages arising Missoula out of a contested case hearing. The District Court changing issued an order venue to the District, and County. First Judicial Lewis Clark The Board moved for granted summary judgment. appeals. was Rahrer We affirm. following Rahrer raises the appeal: issues on ¶2 1. Whether the District Court erred in concluding ¶3 that the Board Commerce, Psychologists, Department of and the State were im- mune from suit for arising causes of action out of a contested case hearing? 2. Whether the District Court erred in concluding that the

¶4 complaining was not liable as a party 37-1-308(2), under § MCA? Whether District Court erred in concluding ¶5 that Rahrer’s attorney premature? claim for fees was BACKGROUND

FACTUAL a psychologist Rahrer is licensed the Department ¶6 of Com- merce, Psychologists. May Board of From 1993 to March 1994 Rahrer three-year-old treated a child parents whose were involved in a di- attorney representing vorce. An the child’s mother asked Rahrer to report concerning prepare her treatment of the child to be used the child’s mother in a visitation proceeding. settlement 6,1994, On June Psychologists Board of complaint received a concerning report. The Board Psychologists issued a Notice of Proposed Opportunity Board Action and for Hearing Administrative 19,1995. May requested hearing. on Rahrer A contested case hear- 3-5,1996, ing hearing was held on June after which the examiner con- Psychologists prove cluded that Board of had failed to that Rahrer any had violated of the Board’s rules of conduct. requested attorney Rahrer an award fees incurred as a result hearing. hearing

of the contested case The examiner observed that “appropriate the Board failed to exercise caution” in evaluating complaint investigation complaint “grossly Board’s ofthe was However, inadequate.” deny he recommended the Board request attorney for fees because the failure her Rahrer’s to dismiss hearing contested case was not case before the unreasonable. 18,1996, judicial petition Rahrer filed a for review On November Court, Comity, in the Fourth Judicial District Missoula in which she attorney fees sought she had incurred as a result of the con- again 16,1997, hearing. May case On Rahrer filed action tested Court, County, seeking the Fourth Judicial District Missoula dam- in By petition judicial ages attorney stipulation, fees. Rahrer’s for stayed pending the outcome of her second action. Pursu- review parties, changed the District stipulation ant to another Court action to the First District the venue for Rahrer’s second Judicial Court, summary County. judg- Lewis and Clark Board moved 16,1998, May 1,1998. In an dated the Dis- ment on order November summary County granted judgment Lewis and Clark trict order. appeals of the Board. Rahrer favor ISSUE concluding Board of the District Court erred 10 Whether ¶ Commerce, immune and the State were Psychologists, Department arising hearing? out of a contested case from suit causes action provides: Article 18 of the Montana Constitution state, counties, cities, towns, and all Subject to Suit. The State shall no from suit government other local entities have except may specifically pro- or be injury person properly, to a legislature. each the by law a 2/3 vote of house of vided 18, proposed the text of Section the accompanying its comments In 1972 Rights Committee of the Constitutional Convention Bill of was to abolish “the archaic doctrine of sover- purpose stated Convention, II at 637. Montana Vol. immunity.” Constitutional eign immunity,” legal meant doctrine “sovereign the Committee By by its offi- negligent the state for acts “bars tort suits which Convention, IIVol. at employees.” Montana Constitutional cials and receive parties that “all should The Committee further stated injuring private is a citizen party whether the just redress fair Convention, II at Vol. Montana Constitutional government agency.” of II, Section the doctrine that Article 18 abolished We have held 12¶ (1975), Mont. 166 City v. Bozeman immunity. See Noll sovereign of immunities, However, also that other have held 504, 534 P.2d 880. we immunity, were not affected sovereign distinct v. II, Dept. rel. Justice 18. See State ex Article adoption of of

31 (1976), 88, District Court 560 P.2d plaintiffs 1328. The in filed Department separate complaints against Attorney Justice of General, Justice, Department Montana, and the State of others, alleging among maliciously the defendants had acted negligently filing charges against criminal them. The defen sought supervisory control, dants a writ of granted, which we direct ing complaints. writ, the District Court to dismiss the In granting the we held that Article Section 18 did not abolish the common law prosecutorial immunity. Department Justice, doctrine of 92, P.2d at 1330. at immune, In that all of concluding the defendants were we ex prosecutorial tended the doctrine of only cover not personal liability prosecutors, but liability also vicarious Department Justice, State and the of Justice. Department 93, justified Mont. at 560 P.2d at 1330. We this extension on public policy grounds: objectives sought granting immunity to indi officers-free, independent, vidual and untrammeled action-would be seriously impaired destroyed if we did not extend immunity to the Justice, agencies. Department state and its 172 Mont. at (Wash. (citing 1966), at 1330 Svenning 606, P.2d Creelman v. 608). (1988), In v.Board Koppen Medical Examiners Mont. P.2d recognized the common-law doctrine

“quasi-judicial” immunity as a “logical descendent of immunity” and extended absolute to the State and its exec agencies not justice process. utive involved the criminal Koppen, 219, 759 plaintiffs P.2d at 176. The in Koppen filed suit against the Board of Medical Examiners and the State alleging negligent the Board in failing to limit or revoke the license of physician, plaintiffs their Dr. Kaufman. The claimed that the Board complaints had received about Dr. Kaufman’s fitness to practice med icine, respond but had failed to complaints. to those We affirmed the suit, holding dismissal of their that the Board and the State im were immunity. under the mune from suit doctrine of recognizing ofthe Board and the State, v.Economou 438 U.S. approval we cited with Butz 2894, 57 plaintiff brought L. Ed. 2d 895. The in Butz had vari 98 S. Ct. Ag in the against Department ous causes of action federal officials arising complaint proceeding. out of an administrative riculture performing officials func- Supreme Court held executive U.S. 32 analogous prosecutor-e.g., and a judge initiating,

tions those of and presenting, adjudicating absolutely cases-were immune from that, light safeguards The Court concluded in of the many suit. which actions, agency their for checked benefits officials in such functioning adjudicatory capacities, maintaining their in- dependent judgment enabling adjudicate them to cases on the complete record, outweighed they basis of a risk would act unconstitutionally. Butz, 512-17, 438 U.S. at 98 S. Ct. at 2914-16. Applying quasi-judicial immunity Koppen, the doctrine of in we weigh that “the vested in the Board to observed discretion infor Dr. rendered quasi-judicial body.” relative to Kaufman it a mation 219, regard, 759 P.2d at 176. In this we Koppen, noted Butz, that, to the defendants in the Board’s similar individual action safeguards hearing require as the notice and subject was such judi Act as well as ments of the Montana Administrative Procedure 219,759 233 Koppen, cial Mont. at P.2d at 176. We concluded review. quasi-judicial function, the Board á performing that because was immune absolutely arising from claims out of its Board was inaction. 219, Mont. at P.2d at 176. Koppen, subsequent holding In we have clarified our opinions, Compensation ex rel. Workers’ v.District In State Division Koppen. (1990), 225, 1272, 246 Mont. we held State not immune Compensation and the Division of Workers’ were from privilege of an em negligence renewing suit their admitted status renewing self-insurance of an ployer to self-insure because discretionary quasi-judicial not a act. Division employer was at P.2d at Compensation, 246 Mont. 1274-78. Workers’ 444, 813 (1991), Mont. P.2d of Dentistry v.Kandarian State Board ofDentistry not immune a tort held that injunction of its to seek an arising suit out decision because, the Board’s decision was not prosecutor, unlike a nonlicensee probable investiga such as cause by procedural safeguards checked Kandarian, Mont. at notice, under oath. tion, swearing Family Department 412. In v. State Services 813 P.2d at Newville 237, 883 Department P.2d we held that the if arising out its acts of immune from suit was not Family Services investigation child placement, approval adoption, foster contested were not of a case part those acts reports because abuse Newville, 269, 883 at process. or other adversarial hearing P.2d at Rahrer asserts that the Board

¶18 is not entitled to act recklessly in investigating complaint, persist a in investigating allega- baseless tions, and fail provide its adequate witnesses with information in a hearing. contested case Rahrer claims that examples these are negligent performance of ministerial duties for which agencies state granted have not been immunity under our decision in Division of Compensation. Workers’ The District Court concluded that the Board was immune from suit for actions arising out of a contested case hear- ing pursuant held to the Montana Administrative Procedure Act. Rahrer’s reliance on Division Compensation is based of Workers’ on a misunderstanding opinion. of that In Division Workers’ Compensation,we held that the Division was not entitled to immunity for negligent its processing employer’s an request for self-insured sta tus because the Division had failed to undertake a mandatory review and the acting Division was not in quasi-judicial a capacity. Division Compensation, 246 Mont. at P.2d at 1276-77. of Workers’ Pursuant to the administrative rules governing election, self-insured only grant Division could self-insured status to employers who stability. demonstrated financial Division Compensation, ofWorkers’ 232, 805 246 Mont. at However, P.2d at 1277. the Division had failed to determine whether the employer eligible was before granting the employer self-insured status. More significantly, in approving appli self-insurance, cations the Division was acting not in a quasi-judicial capacity. The failure of the Division to adequately re the employer’s application view for self-insurance status did not take place during an adversarial dispute resolution of a controversy. or Division Compensation, 230, 805 P.2d at 1276. Workers’ The actions of the Board at issue here analogous are not complained actions of in Division Compensation. Workers’ actions of the Board in determining whether to pursue the complaint Rahrer, investigate how to that complaint, and pre how to pare hearing witnesses for a on complaint clearly are the re that discretionary sult of decisions made during adjudication of a dis pute controversy. or 37-17-202(2)(b), MCA, We note that under § “may conduct hearings upon complaints.” Moreover, there is no dispute complained decisions of took place the context of a hearing contested cáse under the Montana Administrative Proce Initiating, dure Act. investigating, presenting a pursuant case the Montana Administrative Procedure Act precisely involves types granted of decisions for which we have agen- the state and its Accordingly, under Koppen. cies we hold concluding the District Court did not err Board was immunity. entitled

ISSUE concluding Whether the District Court erred in that the Board 37-1-308(2), as a complaining party not liable under MCA? § 37-1-308(1), MCA, person, government, private en- Under § to the tity may complaint submit a written Board. Section MCA, 37-1-308(2), person private entity, “[a] not provides but filing complaint good under section in government entity, filing in a civil action related the or con- faith is immune suit to complaint.” tents 37-1-308(2), liable asserts that the Board is under § Rahrer

¶23 that Board not file the com- Although Rahrer concedes the did MCA. complainant the the Rahrer insists that Board assumed role plaint, “it the pursue complaint apparent after was by continuing any granted in or fact.” The District Court complaint lacked basis law summary in favor of the Board. judgment 37-1-308(2), MCA, creates cause Assuming, arguendo, that a § ¶24 it lim- entity, is clear that would be against government of action faith. complaints entities that file bad Rahrer government ited to file a her. It is also complaint that the Board did not concedes 37-1-308(2), MCA, would lim- under be clear that a cause action § complaint. of a Rahrer filing related to or contents ited actions or the filing of action related to either has not asserted cause li- Instead, claiming is is she complaint. contents of the complaint. Accordingly, we conclude continuing pursue for able 37-1-308(1), is liable under MCA. that the Board not § ISSUE concluding erred in Rahrer’s Whether the District Court ¶25 attorney premature? for fees was claim de- attorney fees and costs incurred in her sought has Rahrer before hearing case action of the contested

fense Court, County. an order dated Missoula District Fourth Judicial matter 1997, in the aforementioned 6, the District Court February are claims which the resolution of the pending stayed proceedings Accordingly, agree with us. now before District in con- attorney pursued should be fees costs claim Rahrer’s removal County. Upon in Missoula pending action her nection with stay District, in the Fourth Judicial Rahrer will be free to pursue her claim against the Board for attorney fees and costs. Affirmed. TURNAGE,

CHIEF JUSTICE JUSTICES LEAPHART and TRIEWEILER concur.

JUSTICE specially NELSON concurs. I concur with our decision as to Issues 2 and 3.1 concur in our opinion as to Issue 1 because the trial court and this Court have cor- rectly applied the doctrine of immunity as created recognized in our case say, however, law. That is not to agree that I jurisprudence. fact, with that In point of I my do not. In view our cre- ation of the doctrine of quasi-judicial immunity is in direct violation II, of Article Section 18 of the Montana Constitution which abolished governmental immunity from suit absent a 2/3 vote of the legislature. Koppen See v. Board Medical (1988), Examiners 220-24, 173, 176-79 759 P.2d (Sheehy, J., concurring and dissenting); Trout v. (1992), Bennett 416, 431-32, (Trieweiler, J., concurring and dissenting). Article Section 18 of the Montana Constitution provides: state, counties, cities, towns, and all other local governmental

entities shall have no from suit injury a person property, except may specifically be provided by law a 2/3 vote of each legislature. house of the although

We have held that provision sovereign abolished immu nity, it did not abolish “prosecutorial immunity.” Dept. Justice v. 88, 92, 560 District Court Mont. P.2d 1330 (hereinafter “DOJ’) (holding that prosecutors acting within the scope of their “absolutely duties are immune” from liability). However, civil we did prosecutorial not limit immunity public employees, to but rather we Department extended it to the of Justice DOJ, and the State. 92, Mont. at 560 P.2d at 1330. Our extension of prosecutorial immunity public to ap- entities

pears to directly be at odds with express both the language and the purpose of Section 18. Presumably, because we held that common-law prosecutorial 18, was not waived Section we were free to exercise powers our common-law governmental extend agen- (Wash. so, doing cies. In we referred to Svenning 1966), Creelman v. 606, in Washington 410 P.2d which the Supreme Court stated: The public policy requires immunity which the prosecuting for attorney, also county both the state and the requires for judicial quasijudicial performance acts in the of officers for otherwise, upon them; objectives the sought the duties which rest by immunity seriously impaired to the individual officers would be destroyed. added). Creelman, (emphasis 410 P.2d at 608 Koppen, quasi-judicial In im we concluded doctrine (a munity “logical prosecutorial immunity”) precluded descendant of Examiners damages against for tort the Board Medical a suit Mont 176. Koppen, State. at P.2d at In the Koppen, the 2-9-112, Court had held that the Board was immune under District § MCA, governmental to the State and other grants which 2-9-112, MCA, judiciary. provides, “judi from the Section units acts of courts established accordance with Article VII ciary includes those added.) (Emphasis State of Montana.” of The Constitution using “includes,” legisla that District Court inferred word grant agencies to administrative ex ture had intended quasi-judicial authority. ercising affirmed the District Court’s conclusion that the appeal, On we suit, immune but different and the State were on DOJ, only Citing we held that Section 18 abolished sover-

grounds. is and distinct from immunity, which eign so, immunity. In doing observed: of the 1972 Constitutional Conven Rights The Bill Committee accompanying text of proposed tion stated in its Comments “the archaic doctrine of purpose 18 that its abolish Section Council, Montana sovereign immunity.” Leg. Mt. Constitutional 1971-72, Convention, 18 to the full con reporting 637. Murray Rights the Bill of Com Delegate approval, vention immunity, stated, feel the doctrine of sovereign “We mittee attempting away particular provi with we are to do which he he sion, really king can do whatever wants but means away it; we’d like to do that doc pay have to with doesn’t Convention, Council, Leg. 5 Mt. Montana Constitutional trine.” 1971-72, 1760. 218, v. at We then cited Butz at 759 P.2d

Koppen, 895, for Ct. 57 L. 2d. 438 U.S. 98 S. Ed. Economou liability would “distort” imposition proposition role. fulfilling its discretion when exercise of Board’s at at Koppen, dissent, Sheehy, joined by Hunt, Justice Justice noted deciding personal government

the Butz court was liability agents liability government not the itself. Koppen, 233 Mont. at 222, 759 Sheehy 2-9-305(1), MCA, P.2d at Justice observed that § already public employees liability immunizes civil from their ac taken the course and of their scope employment. tions within Justice Sheehy stated: liability

[T]he of the state here be should decided on principles only [such Butz] other than cases applying personal liability. to Here, state, by statute, by constitution and is not immune from persons suit. The state is liable to suffer injuries proximately who governmental caused state torts as matter of public policy and as a right. constitutional is, therefore,

It quite illogical for the majority to hold that the exempt state is suit this case possibility because discretion be subject Board’s would to distortion consider possible ations of litigation arising the state from the ac state, tions of the Board of Examiners. Medical without ques tion, accepted assuming has that risk in liability, subjecting and in itself to suit.1

Koppen, 233 Mont. at 759 P.2d at 178-79.2 Exercising authority our to on expound princi- common-law quasi-judicial immunity, ple agencies we have held that are not ab- solutely immune from tort claims. In quasi-judicial order to invoke immunity, agency an must have been performing quasi-judicial opposed purely function as to a ministerial task. See State ex rel. (1990), v.District Comp. 225, 805 Workers’ P.2d 1272. public agency cannot put A invoke if it itself State, litigant adjudicator. in the role of advocate not See Bd. of Dentistry 444, 448, 813 409, 412 v.Kandarian P.2d Although Sheehy’s compelling, might Justice dissent is been have more ac- Montana, people state, say than curate rather have decided through subject they prefer the enactment of Section 18 that would state potentially “distorting” making process at the cost of the decision of executive suit agencies. Trout, (Trieweiler, J., concurring 2. See also at 90 Mont. at P.2d (“To dissenting) my knowledge, Legislature the Montana has never voted to impose by any Therefore, ju a 2/3 vote or other vote. dicially express provision of create such contravenes an the Montana Constitution....”). that, although quasi-judicial (observing similar, doctrinally agency bringing

immunity are suit district by procedural safeguards is in the prose- court not checked inherent investigation system probable swearing such cause and cutorial oath). under judicial premises There seems to be three for the extension of

¶35 (1) agencies functioning prosecu roles: immunity (2) distinct; are sovereign immunity doctrinally and Section 18 torial (3) sovereign immunity; prosecu only abolished and extension immunity policy. torial state entities reflects sound 92-93, at will DOJ, 172 Mont. at 560 P.2d 1330.1 examine each of See premises, in turn. these immunity sovereign immunity and are Prosecutorial ¶36 “different by public are

concepts supported pol and considerations different DOJ, Unfortunately, at DOJ icy.” 172 Mont. at 560 P.2d distinction, point any nor analyze did not did authori court sovereign immunity comprised is of two ties. The doctrine of is a state immune from suit in its principle The first is principles. See, e.g., v. 238 without its consent. Peretti State own courts principle second is that a state is im The Mont. officers, committed liability by agents, torts from mune and Local Governments 1.1 Against 1 Civil Actions State employees. § 1992). (Jon ed., ed. Craig L. 2nd are served the doctrine of sov- purposes fundamental Several immunity. immunity shields the state from the bur-

ereign Sovereign lawsuits, treasury, defending op- the state protects protects den judiciary and private from interference government eration of discretion in citizens, permits governmental officials exercise Actions, 1.2 . responsibilities. their Civil carrying § out theory immunity also exists. “Whether personal of official A statute, public is general or rule offi- on common law based absolutely authority their are immune scope within the acting cials exercising judicial legislative [and] or functions liability for from tort exercising immunity liability from tort executive enjoy a qualified Actions, “The doctrine of offi- §4.1. functions.” Civil administrative that effective immunity public policy on the consideration rests cial are free to act inde- employees who requires officers government per- threat of and intimidation deterrence without pendently, Actions, 4.2. Civil lawsuits.” liability § and vexatious sonal

39 (“prosecutorial” It appears “quasi-judicial”) that official per- doetrinally sovereign immunity is distinct sonal from —the entities, state immunity protects latter while the former protects Here, personally. sovereign being state officers applicable entity, quasi-judicial Board as a state ap- to the should not protect it Rahrer’s suit. ply to from 18 Article Section the Montana Constitution did not abol immunity. DOJ,

ish P.2d at 1330. state, counties, cities, towns, specifically states that “[t]he other local governmental and all entities shall have no added.) (Emphasis Rights suit.” Bill of Committee Convention stated in accompanying Constitutional its comments text of Section 18 that its proposed purpose was to abolish “the ar sovereign immunity.” chaic doctrine Montana Constitutional Con (hereinafter vention, Proposals, Committee Vol. II at “Pro By posals”). sovereign immunity, the Committee meant the doctrine against which “bars tort suits the negligent state for its offi by acts employees.” Proposals, cials and at 637. The Committee stated that should fair parties just “all receive and injuring redress whether the or party private governmental is citizen agency” Proposals, at 637 added). (emphasis The conclusion Section only abrogated sovereign immu-

nity probably is correct and does with correspond the of language this The Section. Committee did not claim that Section 18 abrogate would any pre-existing personal common-law immunities for public officials However, employees. or have made an end-run around Section 18 by extending personal immunity theories (e.g., prosecutorial or quasi-judicial to immunity) Again, above, state entities. noted the Board, as entity protected a state not by personal, is im- quasi-judicial it munity; by immunity is sovereign covered which has been abro- gated Section 18. The prosecutorial immunity extension to quasi-judicial state DOJ, policy.

entities sound See P.2d at reflects underlying assumption The premise 1330. this is that this Court authority prosecutorial quasi-judicial immunity has the to extend or assumption questionable to entities. This is highly given state the above, of Section As language discussed Section 18 waives the im munity qualifications of state entities. two to this Section contains (1) immunity waiver: to general “injury the is limited suits for to a (2) or person property” legislature granted authority the is the to entities a 2/3 vote of each provide state house. Section enti expressly not contain reservation for state 18 does quasi-judicial or functions. performing prosecutorial that are ties authority this has the to extend assumption The questionable given state entities is also history of the legislative Section The assertion that purpose the abrogate prosecutorial 18 did not intend to immu- framers However, it is clear that the framers nity might perfectly be accurate. away sovereign immunity with doctrine which did intend to do —the by its against negligent the state for acts officials and tort suits “bars Rights unanimously Bill Committee voted employees.” longer the “no has provision because doctrine a rational adopt this the “repugnant is fundamental justification in law” and because justice: parties all should receive fair [sic] American premise private or a injuring party whether the is a citizen just redress By extending prosecutorial governmental agency.”Proposals, at 637. entities, immunity to state this Court has frustrated i.e., “bar[ring] tort suits very of Section purpose 18— acts negligent employees.” officials state correctly agree opinion I that our reflects Accordingly, while regards application of the law as state case, opinion jurispru- am that our Board in this I also of

to the is, in fundamentally flawed and is supporting application dence fact, Section 18 of Montana Constitution. in violation of Article case when we are I will look forward to the the circumstances Under this issue. to revisit opportunity accorded foregoing special with TRIEWEILER concurs JUSTICE concurrence.

Case Details

Case Name: Rahrer v. Board of Psychologists

Court Name: Montana Supreme Court

Date Published: Jan 13, 2000

Citation: 993 P.2d 680

Docket Number: 99-091

Court Abbreviation: Mont.