Calkins v. Oxbow Ranch Inc.

No. 12164
I N THE SUPREME COURT O THE STATE O M N A A
F F OTN
1972
KATHLEEN A. HECK CALKINS, i n d i v i d u a l l y
and a s Guardian Ad Litem o f DEBRA HECK,
SALLY HECK, LAURA HECK and EDWARD HECK,
Minors,
Plaintiff and A p p e l l a n t ,
OXBO?? RANCH, INC., a Montana C o r p o r a t i o n ,
d / b / a GILLIS AVIATION,
Defendants and Respondents.
Appeal from: D i s t r i c t Court of t h e T h i r t e e n t h J u d i c i a l D i s t r i c t ,
Honorable C . B. Sande, Judge p r e s i d i n g .
Counsel o f Record:
For Appellants :
W a l t e r H. B i t h e l l a r g u e d , B o i s e , Idaho.
Howard I, Manweiler a r g u e d , B o i s e , Idaho.
J o n e s , Olsen and C h r i s t e n s e n , B i l l i n g s , Montana.
Webb and Tway, B o i s e , Idaho.
For Respondents :
Anderson, Symmes, F o r b e s , P e e t e & Brown, B i l l i n g s ,
Montana,
John L. H i l t s argued, B i l l i n g s , Montana.
Submitted: March 1 6 , 1972
Filed: AYFi iJ 1972
M r . J u s t i c e Wesley C a s t l e s d e l i v e r e d t h e Opinion of t h e Court.
This i s an a p p e a l from a summary judgment f o r defendant
i n a wrongful d e a t h a c t i o n . The judgment was e n t e r e d upon t h e
g r a n t i n g of a motion f o r summary judgment by t h e d i s t r i c t c o u r t
of t h e t h i r t e e n t h j u d i c i a l d i s t r i c t , Yellowstone County, Judge
Charles B. Sande p r e s i d i n g .
The a c t i o n was brought by Kathleen A . Heck Calkins a s
t h e s u r v i v i n g spouse of Donald E. Heck, deceased, and t h e n a t u r a l
mother and guardian ad l i t e m o f Debra, S a l l y , Laura and Edward
Heck, who a r e minor c h i l d r e n of t h e marriage of Kathleen A . Heck
Calkins and Donald E. Heck, deceased.
P l a i n t i f f , i n d i v i d u a l l y and a s guardian ad l i t e m , i n s t i t u t e d
a c t i o n a g a i n s t defendant a l l e g i n g t h a t defendant f u r n i s h e d t o
Dow, Inc. a l i c e n s e d commercial p i l o t by t h e name of Andrew
Deichel, "* * * an employee, s e r v a n t , and a g e n t of s a i d Defendant
*** t o s a f e l y c a r r y t h e s a i d Donald E. Heck, a s a passenger
from B i l l i n g s , Montana t o Eugene, Oregon." It was t h e conten-
t i o n of p l a i n t i f f t h a t t h e p i l o t was a c t i n g w i t h i n t h e c o u r s e
and scope o f h i s employment; t h a t he was a n agent of defendant
a t t h e time of t h e a c c i d e n t ; and t h a t he was n e g l i g e n t .
Defendant i s Oxbow Ranch, I n c . , a Montana c o r p o r a t i o n ,
doing business a s G i l l i s Aviation.
On A p r i l 4 , 1968, Donald E. Heck was k i l l e d w h i l e a
passenger i n an a i r c r a f t owned by h i s employer, Dow, I n c . , a
Wyoming corpora t i o n , w i t h c o r p o r a t e h e a d q u a r t e r s l o c a t e d a t
B i l l i n g s , Montana. The c r a s h of t h e a i r p l a n e occurred i n Oregon,
w h i l e M r . Heck was on a business t r i p originating i n B i l l i n g s
e n r o u t e t o Eugene, Oregon. Also k i l l e d were t h e p i l o t , D e i c h e l ,
and Donald A . Dow, p r e s i d e n t of Dow, Inc. owner of t h e a i r p l a n e
and on whose business t h e t r i p was taken.
Defendant moved f o r summary judgment on t h e b a s i s of t h e
d e p o s i t i o n s i n t h i s a c t i o n pursuant t o Rule 56, M.R.Civ.P., on t h e
grounds t h a t t h e p i l o t , D e i c h e l , was n e i t h e r a n a c t u a l nor a n
o s t e n s i b l e a g e n t of t h e defendant and t h a t t h e r e was no r a t i f i c a -
t i o n of any of t h e a c t s of t h e p i l r t on t h e p a r t of t h e d e f e n d a n t ,
such t h a t t h e d q c t r i n e of respond&it s u p e r i o r d i d n o t apply a s t o
t h e defendant and t h a t t h e r e f o r e no l i a b i l i t y could be p r e d i c a t e d
upon any agency r e l a t i o n s h i p o f t h e defendant.
The i s s u e i s whether t h e r e i s any evidence tending t o
e s t a b l i s h an agency r e l a t i o n s h i p implied o r o s t e n s i b l e , upon t h e
d o c t r i n e of respondea t s u p e r i o r . While t h e a p p e l l a n t ' s b r i e f
i n c l u d e s " a c t u a l r t agency i n i t s s t a t e m e n t of t h e i s s u e , i t i s
conceded t h a t t h e r e i s no proof of a c t u a l agency.
F i r s t , a p p e l l a n t urges t h a t where an a p p e a l i s taken
from t h e g r a n t i n g of a summary judgment t h i s Court w i l l review
t h e testimony i n t h e most f a v o r a b l e a s p e c t i t w i l l bear i n
s u p p o r t of a p l a i n t i f f ' s c l a i m of t h e r i g h t t o p r e s e n t t h e m e r i t s
of h i s c a s e t o t h e f a c t f i n d e r . Mally v. Asanovich, 149 Mont. 99,
423 P.2d 294; Knowlton v. Sandaker, 150 Mont. 438, 436 P.2d 98.
I n d i s c u s s i n g a motion f o r summary judgment i n G a l l a t i n
T r . & Sav. Bk. v. Henke, 154 Mont. 170, 1 7 2 , 461 P.2d 448, t h i s
Court c i t i n g from Silloway v. Jorgenson, 146 Mont. 307, 406 P.2d
167, s a i d :
"I* ** t h e p a r t y opposing motion [ f o r summary
judgment] must p r e s e n t f a c t s i n proper form ---
conclusions of law w i l l n o t s u f f i c e ; and t h e
opposing p a r t y ' s f a c t s must be m a t e r i a l and of a
substantive nature, not fanciful, frivolous,
gauzy, nor merely s u s p i c i o n s . ' 6 ~ o o r Ies F e d e r a l
P r a c t i c e 2d, 5 5 6 . 1 5 [ 3 ] , pp. 2346,2347; Hager v.
Tandy, 146 Mont. 531, 410 P.2d 447."
I n t h e i n s t a n t c a s e most of t h e p a r t i e s t o t h e a r r a n g e -
ment of t h e f l i g h t a r e dead. This p r e s e n t s t o t h e s u r v i v i n g
spouse a d i f f i c u l t proof problem. But, proof of a n a c t u a l o r
o s t e n s i b l e agency may be i n t h e form of c i r c u m s t a n t i a l proof a s
w e l l a s d i r e c t proof. I n Freeman v. Withers, 1.04 Mont. 166, 172,
65 P.2d 601, t h i s Court s a i d :
"It [agency] may be implied from conduct and from
a l l t h e f a c t s and circumstances i n t h e c a s e ***
and may be shown by c i r c u m s t a n t i a l evidence."
Also, i n Hamilton v. Lion Head S k i L i f t , I n c . , 139 Mont. 335,
340, 363 P.2d 716, t h i s Court s a i d :
"!* * * agency i s a m a t t e r , n o t t o be presumed,
but t o be proven, and t h e burden of proving i t
must be borne by t h e p a r t y who a s s e r t s i t . "'
Before proceeding t o a n a n a l y s i s of t h e f a c t s , we s h a l l
b r i e f l y s e t f o r t h p r o v i s i o n s p e r t a i n i n g t o agency. Sections
2-104, 2-105, 2-106, and 2-124, R.C.M. 1947, d e f i n e a c t u a l and
o s t e n s i b l e agency. S e c t i o n 2-106 s t a t e s t h a t a n agency i s
o s t e n s i b l e when t h e p r i n c i p a l i n t e n t i o n a l l y , o r by want of
o r d i n a r y c a r e , causes o r a l l o w s a t h i r d person t o b e l i e v e an-
o t h e r t o be h i s a g e n t who i s n o t r e a l l y employed by him.
The deceased pi l o t , Deichel, had worked f o r Herrod Avia-
t i o n from January 1968 u n t i l A p r i l 1968, when he q u i t because
he wanted a few days o f f p r i o r t o t h e commencement o f new em-
ployment w i t h Northwest A i r l i n e s a s a p i l o t . Deichel had a n
A i r l i n e Transport p i l o t ' s r a t i n g , t h e h i g h e s t a t t a i n a b l e . Deichel
had never worked f o r G i l l i s A v i a t i o n .
In February 1968, Dow, I n c . had begun n e g o t i a t i o n s w i t h
G i l l i s Aviation f o r t h e purchase of a n a i r p l a n e . O February
n
16, Dow made a d e p o s i t on t h e a i r c r a f t . On March 30, Dow made
a $1500 payment and f i n a n c i a l arrangements a t a bank t o ,pay t h e
balance. G i l l i s Aviation i s s u e d a b i l l of s a l e . This i s t h e
a i r c r a f t t h a t crashed on A p r i l 4 , 1968.
The two main o f f i c e r s and owners of Dow, Inc. were Donald
A . DOW, P r e s i d e n t , and Terry Lowell, Vice-President. They had
purchased t h e a i r c r a f t . They made a l l arrangements. The de-
ceased Heck was t h e i r employee. Both Dow and Lowell e i t h e r were
t a k i n g f l y i n g l e s s o n s from G i l l i s Aviation o r were planning t o .
The a i r c r a f t was t o be used i n Dow, Inc. t s b u s i n e s s .
I n a d d i t i o n t o t h e business d e a l i n g s between Dow, I n c .
and G i l l i s Aviation on t h e purchase of t h e a i r c r a f t , Dow, I n c .
had used c e r t a i n of t h e p i l o t s employed by G i l l i s A v i a t i o n t o
p i l o t t h e company a i r c r a f t . I t i s c l e a r from t h e d e p o s i t i o n s
t h a t t h e company r e l i e d on M r . G a l l a g h e r , manager of G i l l i s
A v i a t i o n , f o r many t h i n g s such a s a d v i c e , p i l o t arrangements,
f l i g h t t r a i n i n g and o t h e r s .
However, t h e d e p o s i t i o n s r e v e a l t h a t r l i g h t s were made by
Dow, Inc. personnel i n t h e a i r c r a f t involved w i t h one Barovich
a s t h e p i l o t and Dow, Inc. paid only f o r h i s meals and h i s room,
but n o t f o r h i s s e r v i c e s a s a p i l o t . No charge was ever made by
G i l l i s A v i a t i o n f o r any of t h e f l i g h t s of Barovich. The only
charges r e c e i v e d by G i l l i s were f o r t h e p i l o t who was t e a c h i n g
Dow how t o f l y and f o r log books, r a t h e r than f o r any c h a r t e r
flights.
I n a t t e m p t i n g t o make arrangements for, t h e f l i g h t from
B i l l i n g s t o Eugene, which proved t o be t h e f a t a l f l i g h t , Dow, I n c .
r e p r e s e n t a t i v e s c o n t a c t e d v a r i o u s p i l o t s who had p r e v i o u s l y flown
them. They were a d v i s e d t h a t none of them could p i l o t t h e a i r -
craft. One o f t h e s e p i l o t s , Barovich, was a c o l l e g e s t u d e n t ,
h o l d e r o f a p r i v a t e l i c e n s e , who had worked a s a f l i g h t l i n e
employee of G i l l i s A v i a t i o n . D w r e p r e s e n t a t i v e s were t o l d t h a t
o
Barovich could n o t f l y them a s a f r e e - l a n c e o p e r a t o r , and they
would have t o go through G i l l i s Aviation t o g e t a p i l o t . Dow,
t h e p r e s i d e n t of Dow, I n c . , d i d u l t i m a t e l y c o n t a c t Gallagher and
requested t h a t he, G a l l a g h e r , s e c u r e a p i l o t . Gallagher f i n a l l y
c o n t a c t e d Deichel.
P i l o t Deichel was introduced by Gallagher t o t h e Dow, Inc.
r e p r e s e n t a t i v e s a s a q u a l i f i e d p i l o t who, w h i l e a w a i t i n g a c a l l t o
employment by Northwest A i r l i n e s , would t a k e t h e t r i p t o Eugene
t o e a r n some e x t r a money. P i l o t Deichel made i t c l e a r t o a l l
t h a t immediately upon Northwest's c a l l , Dow, Inc. would be r e q u i r e d
t o r e t u r n him t o B i l l i n g s .
There was never any d i s c u s s i o n w i t h G i l l i s A v i a t i o n by any
member of Dow, Inc. concerning any charges f o r t h e f l i g h t by
Deichel. The only testimony concerning any arrangements f o r
charges by Deichel came from Gallagher who s t a t e d t h a t he i n t r o -
duced Deichel t o Lowell and Dow and s a i d , "You fellows make your
own arrangements w i t h Andy Deichel."
Lowell simply d i d n o t know what arrangements were made w i t h
p i l o t Deichel. Diane Dow, w i f e of t h e deceased p r e s i d e n t o f Dow,
I n c . and i t s then bookkeeper, d i d n o t know what arrangements were
made w i t h Deichel, but s h e d i d know t h a t on a previous occasion
o r o c c a s i o n s , Dow, I n c . had paid f o r p i l o t s through G i l l i s Avia-
tion.
The deceased, Heck, was an employee of Dow, I n c . accompany-
ing h i s boss, Don Dow, and a p p a r e n t l y never knew what a r r a n g e -
ments had been made.
P l a i n t i f f , a p p e l l a n t h e r e , recognizes t h a t t h e r e i s no
d i r e c t testimony of a n agency, but i n s i s t s t h a t a l l i n f e r e n c e s
from f a c t s of p r i o r business t r a n s a c t i o n s between Dow, I n c . and
G i l l i s A v i a t i o n concerning a i r c r a f t , f l i g h t i n s t r u c t i o n , and
procurement o f p i l o t s , t o g e t h e r w i t h t h e foregoing summary of
how p i l o t Deichel was procured, supply c i r c u m s t a n t i a l evidence
s u f f i c i e n t t o withstand a motion f o r summary judgment. Plaint i f f
would go even f u r t h e r i n s e t t i n g f o r t h f a c t s by r e f e r r i n g t o
G l l a g h e r ' s a c t i v i t i e s i n checking weather information f o r t h e
a
t r i p ; making arrangements f o r an a i r s e a r c h i n Oregon after
h e a r i n g t h a t t h e a i r c r a f t was missing; v o l u n t e e r i n g f r e e t r a n s -
p o r t a t i o n of t h e bodies back from Oregon; and a s t a t e m e n t by
Gallagher t o a M r . Peterson a f t e r t h e a c c i d e n t - - - " ~ r . P e t e r s o n ,
d o n ' t be concerned about l i a b i l i t y . That i s covered. " A l l of
t h e s e m a t t e r s , mostly a f t e r t h e a c c i d e n t , p l a i n t i f f reasons a r e
c o n s i s t e n t w i t h an o s t e n s i b l e agency and a r e , i n t h e l i g h t most
f a v o r a b l e t o h e r , f a c t s proving a g o s t e n s i b l e agency.
However h e r e t o f o r e , we s e t o u t a b r i e f summary of pro-
v i s i o n s p e r t a i n i n g t o agency. There we noted t h a t where t h e
p r i n c i p a l , i n t e n t i o n a l l y o r by want of o r d i n a r y c a r e , causes o r
allows a t h i r d person t o b e l i e v e a n o t h e r t o be h i s a g e n t who i s
n o t r e a l l y employed by him r a i s e s a q u e s t i o n of agency. Dow, Inc.
is not a party. Everyone knew Dow, Inc. owned t h e a i r c r a f t .
The deceased, Heck, has n o t been shown, i n any manner, t o have
r e l i e d on p i l o t ~ e i c h e' l supposed agency from G i l l i s A v i a t i o n .
s
Heck h e r e i s t h e t h i r d person. There simply i s no evidence t o
show whether o r n o t he r e l i e d on, i n any manner, a n agency of
Deichel. As p r e v i o u s l y n o t e d , t h e burden of proving agency must
be borne by t h e p a r t y who a s s e r t s i t . Hamilton v. Lion Head S k i
L i f t , I n c . , 139 Mont. 335, 363 P.2d 716.
P r i o r t o t h e d e p a r t u r e o r t h e f l i g h t t h e r e i s no evidence
t h a t G a l l a g h e r , r e p r e s e n t i n g G i l l i s A v i a t i o n , d i d anything t o
c r e a t e a b e l i e f i n t h e mind of Heck t h a t p i l o t Deichel was
G i l l i s g via ti on's a g e n t f o r t h a t k l i g h t . A s t a r a s t h i s record
i s concerned, t h e r e i s no b a s i s f o r t h e a p p l i c a t i o n of t h e r u l e s
o t o s t e n s i b l e agency. O s t e n s i b l e agency n e c e s s a r i l y would be
p r e d i c a t e d upon an e s t o p p e l . The e s t o p p e l would a r i s e a g a i n s t
t h e p r i n c i p a l f o r t h e b e n e f i t of t h e p a r t i e s who have d e a l t with
t h e p r i n c i p a l p r i o r t o changing t h e i r p o s i t i o n i n r e l i a n c e upon
t h e r e p r e s e n t a t i o n s by t h e p r i n c i p a l . As s t a t e d h e r e t o f o r e ,
t h e r e simply i s no evidence of any r e p r e s e n t a t i o n . Statements and
a c t i o n s by Gallagher a f t e r d e p a r t u r e of t h e f l i g h t do n o t supply
t h e evidence of o s t e n s i b l e agency. W a r e n o t concerned h e r e
e
w i t h " r a t i f i c a t i o n " because t h e r e was no r e p r e s e n t a t i o n by t h e
p r i n c i p a l nor any evidence ok r e l i a n c e by t h e t h i r d p a r t y , Heck.
See S e a r l e v. Great Northern Railway Company, 189 F.Supp. 423,
f o r requirement of r e p r e s e n a t i o n o r "holding out" by t h e a l l e g e d
principal. Also s e e : H a r t t v. Jahn, 59 Mont. 173, 182, 196 P.
153; Elkins v. Husky O i l Co., 153 Mont. 159, 455 P.2d 329.
To t h e foregoing d i s c u s s i o n we add t h a t t o f u r t h e r develop
f a c t u a l testimony only amounts t o a n a t t e m p t t o prove t h e n e g a t i v e .
There was no a c t u a l agency r e l a t i o n s h i p shown. There was no
implied agency shown because t h e r e i s no proof t h a t p i l o t Deichel
believed he had such agency a u t h o r i t y . There i s no proof of
o s t e n s i b l e agency. Thus, t h e r e i s no genuine i s s u e of m a t e r i a l
f a c t and t h e summary judgment was p r o p e r l y g r a n t e d under Rule
5 6 ( c ) , M.R.Civ. P.
Accordingly, t h e judgment i s a ffirmed.
~ s s o c i a t Justice
d
I I-
Chief ~ u s c i c e
ci
Associate J u s t i c e s .