10/13/2026
DA 25-0808
Case Number: DA 25-0808
IN THE SUPREME COURT OF THE STATE OF MONTANA
2026 MT 243
GATEWAY CONSERVATION ALLIANCE,
Plaintiff and Appellant,
v.
STATE OF MONTANA, and MONTANA
DEPARTMENT OF ENVIRONMENTAL
QUALITY,
Defendant and Appellee,
TMC, Inc.,
Intervenor and Appellee.
APPEAL FROM: District Court of the Eighteenth Judicial District,
In and For the County of Gallatin, Cause No. DV-2024-838A
Honorable Peter B. Ohman, Presiding Judge
COUNSEL OF RECORD:
For Appellant:
Robert Farris-Olsen, David K. W. Wilson, Jr., Morrison Sherwood
Wilson Deola, PLLP, Helena, Montana
Graham Coppes, Emily Wilmott, Anders K. Newbury, Ferguson and
Coppes, PLLC, Missoula, Montana
For Appellee Montana Department of Environmental Quality:
Samuel King, Jeremiah Langston, Kaitlin Whitfield, Department of
Environmental Quality, Helena, Montana
For Appellee TMC, Inc.:
Mark L. Stermitz, Crowley Fleck PLLP, Missoula, Montana
For Amicus Curiae Montana Contractors Association:
Brian P. Thompson, Hallee C. Frandsen, Browning, Kaleczyc, Berry
& Hoven, P.C., Helena, Montana
Submitted on Briefs: August 5, 2026
Decided: October 13, 2026
Filed:
Clerk
2
Justice Beth Baker delivered the Opinion of the Court.
¶1 Appellant Gateway Conservation Alliance (Gateway) appeals the Eighteenth
Judicial District Court’s dismissal of its complaint for failure to exhaust administrative
remedies. We conclude that Gateway may challenge the constitutionality of the statute
authorizing the DEQ permit at issue only after completing its administrative appeal before
the Board of Environmental Review. We therefore affirm.
FACTUAL AND PROCEDURAL BACKGROUND
¶2 In March 2024, the Montana Department of Environmental Quality (“DEQ”)
approved Opencut Permit #3462 (“Permit 3462”). TMC, Inc., which applied for the permit
in May 2023, plans to mine clay, gravel, and sand at the “Black Site” in Gallatin County,
Montana, for twenty years.
¶3 Opencut mines must conform to The Opencut Mining Act (“the Act”), codified at
Title 82, chapter 4, part 4, MCA. The Act is intended to “provide adequate remedies for
the protection of the environment[] . . . from degradation and . . . to prevent . . . [the]
degradation of natural resources.” Section 82-4-402(1), MCA. DEQ is responsible under
the Act for determining whether to grant or deny opencut mining permits.
Section 82-4-422(1)(a), MCA. During the 2021 Montana Legislative Session, the
Legislature passed House Bill 599 revising opencut mining laws to “provid[e] less stringent
applications for certain opencut operations[.]”
¶4 The contested case provisions of the Montana Administrative Procedure Act
(“MAPA”) apply to permits issued under the Act. Section 82-4-427(4), MCA. A person
seeking to appeal approval of a permit application must submit a written request to the
3
Board of Environmental Review (“Board”) within 30 days of DEQ’s decision.
Section 82-4-427(1)(a), MCA. Gateway filed a notice of appeal with the Board in
March 2024. Gateway claimed that Permit 3462 violates the Act’s intentions, ground
water requirements, plan of operation requirements, and the requirement that DEQ verify
information submitted by the applicant. Gateway requested that the Board find that DEQ
violated statutory requirements and set aside the approval of Permit 3462.
¶5 Four months after filing its administrative appeal, Gateway filed a complaint against
DEQ in Gallatin County District Court, while the appeal was pending before the Board.1
Gateway asserted that the HB 599 amendments to the Act violated the right to a clean and
healthful environment under Article II, Section 3 of the Montana Constitution. Gateway
sought a declaration that HB 599 is unconstitutional, a permanent injunction against its
enforcement, and vacatur of Permit 3462. TMC intervened with leave of court.
¶6 DEQ moved to dismiss Gateway’s constitutional challenge to HB 599 because
Gateway did not exhaust its administrative remedies in accordance with MAPA. The
District Court agreed and granted the DEQ’s motion to dismiss. Gateway now appeals.
This Court granted the Montana Contractors Association leave to file an amicus curiae
brief supporting DEQ’s position.
1
Gateway also filed a separate action challenging DEQ’s Environmental Assessment in the District Court simultaneously with its challenge to the Board. That action is not involved in this appeal.
4
STANDARDS OF REVIEW
¶7 “We review de novo a district court’s ruling on a M. R. Civ. P. 12(b)(6) motion to
dismiss.” Roaring Lion Ranch, LLC v. YC Properties, 2026 MT 60, ¶ 10, 427 Mont. 201,
586 P.3d 278. We review a district “court’s decision that a party failed to exhaust
administrative remedies” for correctness as a conclusion of law. Flowers v. Bd. of Pers.
Appeals, Mont. Dep’t of Fish, Wildlife, & Parks, 2020 MT 150, ¶ 6, 400 Mont. 238,
465 P.3d 210.
DISCUSSION
¶8 Section 2-4-702(1)(a), MCA, allows judicial review in a contested agency case after
the exhaustion of all available administrative remedies. A party generally may not raise
any question not raised in front of the agency without a showing of good cause.
Section 2-4-702(1)(b), MCA. The statute provides, however, that “[a] party who proceeds
before an agency under the terms of a particular statute may not be precluded from
questioning the validity of that statute on judicial review[.]” Section 2-4-702(1)(b), MCA.
And an agency action “is immediately reviewable if review of the final agency decision
would not provide an adequate remedy.” Section 2-4-701, MCA.
¶9 The District Court looked to City of Great Falls v. Int’l Ass’n of Fire Fighters,
2024 MT 302, 419 Mont. 262, 560 P.3d 621 (City of Great Falls), for guidance in
considering DEQ’s motion to dismiss. The District Court explained that although City of
Great Falls recognized a facial constitutional challenge to the administrative scheme as an
exception to exhaustion requirements, the exception was not present in Gateway’s case.
5
¶10 In City of Great Falls, the City imposed a new drug and alcohol policy on all
employees, including union members subject to a collective bargaining agreement. City of
Great Falls, ¶ 3. The City failed to obtain the consent of the unions and denied demands
for collective bargaining regarding the new policy. City of Great Falls, ¶ 3. The unions
began filing individual labor practice complaints with the Montana Board of Personnel
Appeals (“MBPA”). City of Great Falls, ¶ 4. The MBPA consolidated the complaints for
a contested case administrative hearing and adjudication. City of Great Falls, ¶ 5. The
agency hearing examiner issued a decision in favor of the unions. City of Great Falls, ¶ 6.
Rather than file exceptions to the proposed decision and order for final MBPA review, the
City petitioned the district court for judicial review under § 2-4-701, MCA. City of Great
Falls, ¶ 7. In district court, the City argued that assertions of error for pure questions of
law are exempt from administrative remedy as required by § 2-4-702(1)(a), MCA. City of
Great Falls, ¶ 7. The City also argued that waiting for review of a final agency decision
by a “non-judicial board” would not remedy the asserted errors of law and would “not be
in the interests of judicial economy.” City of Great Falls, ¶ 7. The unions responded that
the City could not circumvent the exhaustion requirement and distinguished the case from
prior cases that allowed exception from administrative exhaustion. City of Great Falls,
¶ 7. The district court dismissed the City’s petition for failure to exhaust administrative
remedies in accordance with the remedy provided under the requirements of the Unfair
Labor Practices Act. City of Great Falls, ¶ 7.
¶11 On appeal, this Court reasoned that “a sweeping jurisprudential pure question of
law, or narrower pure question of constitutional law, exception to § 2-4-702(1)(a), MCA,
6
would irreconcilably conflict with the authorized scope of the final agency review remedy
expressly provided by [MAPA] . . . .” City of Great Falls, ¶ 28. A facial constitutional
challenge must contest the administrative procedure to escape the exhaustion requirement.
City of Great Falls, ¶¶ 28, 30. We clarified that a constitutional issue accompanied by
assertions of error regarding correctness of an agency decision does not qualify for the
exception to the exhaustion doctrine. City of Great Falls, ¶ 23; see generally
Shoemaker v. Denke, 2004 MT 11, 319 Mont. 238, 89 P.3d 4 (exception applies only to
pure constitutional law questions not dependent on fact-based determinations in the
jurisdiction of the agency to decide) (abrogated in part by City of Great Falls).
¶12 Under § 82-4-427(1), MCA, “a person whose interests are or may be adversely
affected by a final decision of the department to approve or disapprove a permit
application . . . is entitled to a hearing before the board[.]” Gateway acknowledges that it
was required to proceed under this statute but asserts that because its District Court
complaint presents a “facial constitutional challenge,” it permissibly brought that claim
independently. Gateway argues that exhaustion is not required because the District Court
and the Board are considering different legal and factual questions and because exhaustion
would be futile, as the Board has no authority to resolve a facial constitutional challenge.
¶13 DEQ responds that Gateway’s complaint does not raise a pure question of
constitutional law that challenged the administrative scheme. It instead challenges the
statutory basis for the permit. DEQ argues that, in accordance with MAPA, Gateway
cannot evade its contested case proceeding before the Board by filing a separate action in
District Court because the request for declaratory relief is not independent of an agency
7
action. TMC and the Montana Contractors Association likewise urge this Court to follow
the rationale of City of Great Falls and affirm the District Court’s grant of DEQ’s motion
to dismiss.
¶14 Gateway’s appeal to the Board advanced various alleged violations of the Act
specific to TMC’s permit application and the Black Site. Gateway requested that the Board
set aside approval of Permit 3462 as unlawful and void. Gateway’s District Court
complaint similarly recounts the alleged errors specific to TMC’s application and the Black
Site in support of its request to declare HB 599 unconstitutional and vacate Permit 3462.2
Gateway pleaded that its “constitutional rights to a clean and healthful environment and
adequate remedies to prevent unreasonable environmental harms was infringed by []
DEQ’s permitting of the Black [Site] . . . .” Both in its appeal to the Board and in its
complaint before the District Court, Gateway requested vacatur of Permit 3462 because of
its alleged unconstitutional or otherwise unlawful issuance.
¶15 The District Court reasoned that “to have an adequate picture of the constitutional
implications of the challenged statute, the [c]ourt needs facts that pertain to that question[]”
presented to the agency. As discussed in City of Great Falls, constitutional issues
accompanied by assertions of error by an agency do not qualify for the exception to the
exhaustion doctrine as a pure question of law. City of Great Falls, ¶ 23. Gateway’s
2
Section 82-1-401, MCA, provides that “the plaintiff shall first establish the unconstitutionality of the underlying statute” prior to “invoking the [district] court’s original jurisdiction to challenge the constitutionality” of a permitting decision under Title 82. The parties do not cite this statute, but it does not in any event displace the administrative exhaustion requirement or the ability to petition properly for judicial review, at which time Gateway may bring its constitutional challenge.
8
constitutional challenge is not an independent claim for declaratory relief untethered to an
agency action. The present case fits squarely within the scope of what we explained in
City of Great Falls. Gateway’s constitutional claim is not a facial constitutional challenge
to the administrative scheme but instead implicates the agency’s action specific to the
challenged permit. Because of this, Gateway’s complaint does not fall within this Court’s
recognized exception to administrative remedy exhaustion. City of Great Falls, ¶ 28.
¶16 Gateway points out that the Board does not have the authority to decide
constitutional issues in a declaratory judgment action. Gateway argues that, due to the
jurisdiction conferred to the District Court and the doctrine of separation of powers,
proceeding with its constitutional question in front of the Board is improper. DEQ counters
that Gateway conflates the District Court’s jurisdiction to hear the constitutional question
with the timing of when it may exercise that jurisdiction. DEQ argues that the Uniform
Declaratory Judgment Act (“UDJA”) cannot be invoked to escape MAPA requirements.
¶17 Immediate review of an agency action is available “if review of the final agency
decision would not provide an adequate remedy.” Section 2-4-701, MCA. As stated
above, parties who have “exhausted all administrative remedies available within the
agency” and are “aggrieved by a final written decision in a contested case [are] entitled to
judicial review[.]” Section 2-4-702(1)(a), MCA. The administrative remedy exhaustion
requirement “prevents courts from ‘premature . . . entangl[ement] . . . in abstract
disagreements over [regulatory] policies’ . . . .” N. Star Dev., LLC v. Mont. Pub. Serv.
Comm’n, 2022 MT 103, ¶ 20, 408 Mont. 498, 510 P.3d 1232 (alterations in original)
(abrogated on other grounds by City of Great Falls). As noted, § 2-4-702(1)(b), MCA,
9
allows the constitutional claim to be coupled with a petition for judicial review of the
Board’s decision. We agree with Gateway that it did not waive its right to go to the district
court by appealing DEQ’s permitting decision to the Board. But because Gateway filed its
complaint without a final Board decision, administrative remedies have not been
exhausted.
¶18 Gateway attempts to liken its situation to Held v. State, 2024 MT 312, 419 Mont.
403, 560 P.3d 1235. It concedes, however, that “no underlying permit was at issue” in that
case. Gateway also cites Mont. Env’t Info. Ctr. v. Dep’t of Env’t Quality, 1999 MT 248,
296 Mont. 207, 988 P.2d 1236 (MEIC), to support its contention that this Court has allowed
facial challenges to proceed in the absence of an administrative proceeding. DEQ responds
that Held is distinct from the current case because it involved a constitutional challenge
that was independent from agency action.
¶19 Gateway’s reliance on Held and MEIC is misplaced. Held did not involve a
challenge to a specific permit. Held, ¶ 53. It instead involved a challenge to the Montana
Environmental Policy Act, untethered to an ongoing agency action. Held, ¶ 5. MEIC also
did not involve a pending administrative review; the plaintiffs there challenged an
amendment to the Water Quality Act that excluded “certain activities from review pursuant
to the act’s nondegradation policy[.]” MEIC, ¶ 37. Both of these cases thus presented a
procedural posture distinct from the current case. MEIC, ¶ 17. In MEIC, we did not disturb
the premise that parties are entitled to bring a direct action to enforce fundamental rights,
and we need not do so here. MEIC, ¶¶ 28, 45. In this case, both actions seek invalidation
10
of the same permit. Gateway’s pending administrative case requires it to comply with
MAPA requirements before filing in the District Court.
¶20 Section 2-4-702(1)(b), MCA, creates an exception to the exhaustion requirement for
a party to question the validity of a particular statute. But the statute makes clear the
required procedure and process. A party challenging an agency decision subject to MAPA
first must bring its claims to the agency and obtain a final ruling. Once that final agency
decision is issued, the aggrieved party may seek judicial review of (1) all questions raised
before the agency, (2) the validity of the statute underlying the agency’s actions, and
(3) upon a showing of “good cause,” “any other” question it did not first raise in the
contested case proceeding. Section 2-4-702(1)(b), MCA. Therefore, though Gateway is
correct that it does not have to litigate its constitutional claim to the Board, it does first
have to exhaust its contested case proceeding on the permit. If the Board rules adversely,
Gateway may petition for judicial review, at which time it may present the constitutional
claim.3
¶21 As City of Great Falls explained, this honors both the judiciary’s exclusive authority
“to determine, interpret, or apply applicable statutory or constitutional law” and the
Legislature’s express constitutional authority to “provide for direct review by the
district court of decisions of administrative agencies.” City of Great Falls, ¶ 28;
Mont. Const. art. VII, § 4(2). “As an express procedural prerequisite for judicial review of
3
Counsel for Gateway filed a notice of supplemental authority in this appeal on October 8, 2026, referencing two recent Montana district court decisions. Both decisions support our conclusion here that a facial constitutional challenge to a statute may be coupled with a petition for judicial review of the Board’s decision following a final decision by the Board.
11
contested case agency decisions under §§ 2-4-702 through -704, MCA, the exhaustion of
administrative remedies requirement of § 2-4-702(1)(a), MCA, is a threshold procedural
justiciability requirement for exercise of that district court subject matter jurisdiction.” City
of Great Falls, ¶ 18 (internal quotation marks and citations omitted).
¶22 As we further clarified, an exception to MAPA’s exhaustion requirement may be
found “only when the matter at issue involves a pure question of constitutional law, not
accompanied by an issue regarding a fact-based determination within the pertinent
jurisdiction of the agency to decide.” City of Great Falls, ¶ 23. In this action, Gateway
challenges the Permit—its constitutional arguments are “accompanied by” issues regarding
determinations within the Board’s jurisdiction. Section 2-4-702(1)(b), MCA, expressly
preserves Gateway’s ability to raise its constitutional challenge on judicial review of any
adverse Board decision.
¶23 This Court long has recognized that “courts should avoid constitutional issues
whenever possible.” In re License Revocation of Gildersleeve, 283 Mont. 479, 485,
942 P.2d 705, 709 (1997) (citation omitted). The District Court reasoned that if it issued
“a ruling that agreed with [Gateway] that the statutory scheme is facially an environmental
violation of constitutional proportions” and then the Board found no evidence of damage,
“it would operate as a reversal of the facial challenge.” We agree with the District Court.
Tethered as it is to Permit 3462 at issue, Gateway’s constitutional challenge may be mooted
if the Board invalidates Permit 3462 on other grounds. This process thus harmonizes with
our oft-invoked principle that the courts will not reach constitutional issues except as a last
resort. The exhaustion of administrative remedies “allows an agency to make a factual
12
record and correct its own errors within its specific expertise.” City of Great Falls, ¶ 17
(internal quotations omitted; citation omitted). If the Board agrees with Gateway’s
arguments in the administrative appeal, consideration of the constitutional claims would
be unnecessary to grant Gateway the relief it seeks.
¶24 Contrary to Gateway’s claim of futility (citing Schuster v. NorthWestern Energy
Co., 2013 MT 364, 373 Mont. 54, 314 P.3d 650), the relief of vacatur of Permit 3462 is
available both by action in front of the Board and on judicial review in the District Court.
Section 2-4-702(1)(b), MCA, expressly permits Gateway to challenge the statute on
judicial review of a final Board decision should it be unfavorable.4 Therefore, Gateway’s
argument that proceeding in front of the Board would be futile is incorrect.
¶25 Gateway also argues that developing a record about how the agency formerly
proceeded prior to the challenged statutory amendments would be irrelevant to the Board’s
review of the underlying permit, and it should be entitled to develop that record before the
District Court. DEQ responds that exhaustion is not futile just because of the possibility
that evidence will not be admitted by the Board or that it will not rule in Gateway’s favor.
We agree that Gateway has not demonstrated futility when it “has neither attempted to
exhaust its administrative remedies, nor [] alleged facts that if proven would show the
futility of the available administrative remedies.” Mountain Water Co. v. Mont. Dep’t of
Pub. Serv. Regul., 2005 MT 84, ¶ 15, 326 Mont. 416, 110 P.3d 20. What is more, MAPA
4
We ruled in Schuster that the plaintiff was not required to exhaust an administrative remedy before filing an action in district court because the administrative agency could not grant the requested remedy he sought—monetary damages for the defendant’s negligence. Schuster, ¶¶ 11-13.
13
provides a process for receipt of additional evidence on judicial review if certain criteria
are shown “to the satisfaction of the court[.]” Section 2-4-703, MCA. Administrative
review is not futile; it is a required part of the process.
¶26 The District Court additionally addressed its concern with piecemeal litigation.
Gateway argues that first requiring a permit at the administrative level gives the agency a
gatekeeping veto over statutory interpretation for whether statutes satisfy constitutional
protections. DEQ responds that the fundamental purpose of exhaustion would be defeated
if Gateway proceeds on its constitutional claim in the District Court. Montana Contractors
Association argues that Gateway’s appeal demonstrates an attempt at piecemeal litigation.
¶27 “The statutory bar until a final action is issued aims to avoid piecemeal
litigation and micromanagement by the court in the environmental review process.”
Jefferson Cnty. v. Dep’t of Env’t Quality, 2011 MT 265, ¶ 32, 362 Mont. 311, 264 P.3d
715. Exhausting administrative remedies “furthers both the interests of ‘judicial economy,’
by relieving congestion and stress on the overburdened judicial system, and the interest of
agency ‘efficiency’ in the attendant performance of legislatively-assigned legal duties and
functions.” City of Great Falls, ¶ 18 (citation omitted). We decline to abandon the
rationale of our prior cases. Gateway currently is pursuing three separate cases—one in
front of the Board and two in the District Court—to challenge a single permit. Here,
requiring administrative exhaustion avoids piecemeal litigation, furthers judicial economy,
and facilitates efficiency in the ongoing administrative action.
14
CONCLUSION
¶28 The District Court did not err in dismissing Gateway’s complaint for failure to
exhaust administrative remedies. The order of dismissal is affirmed.
/S/ BETH BAKER
We Concur:
/S/ CORY J. SWANSON
/S/ JAMES JEREMIAH SHEA
/S/ LAURIE McKINNON
/S/ JIM RICE
15