Title: POLICH v WHALEN S O K TIRE WAREHO

State: montana

Issuer: Montana Supreme Court

Document:

No. 81-153 IN T H E SUPREME C O U R T O F T H E STATE OF M O N T A N A 1981 WILLIAM T. POLICH, Claimant and Respondent, -vs- WHALEN'S 0 . K . TIRE WAREHOUSE, Employer, and GLACIER GENERAL ASSURANCE CO., Defendant and Appellant. Appeal from: The Workers' Compensation Court, The Honorable William E . Hunt, Judge p r e s i d i n g . Counsel o f Record: For Appellant : Garlington, Lohn & Robinson, Missoula, Montana For Respondent: Dowling Law Firm, Helena, Montana Submitted on B r i e f s : June 17, 1981 Decided: SEP 2 5 1 9 8 1 F i l e d : SEP 2 5 w- M r . J u s t i c e Fred J. Weber delivered t h e Opinion of t h e Court. The insurance c a r r i e r appeals from a judgment i n t h e Workers' Compensation Court finding t h e claimant t o t a l l y and permanently disabled and converting h i s f u t u r e biweekly bene- f i t s i n t o a lump sum payment. Appellant questions t h e s u f f i - ciency of t h e evidence presented t o t h e c o u r t i n support of a lump sum payment and questions whether claimant i s e n t i t l e d t o a t t o r n e y f e e s and c o s t s . W e a f f i r m t h e judgment of t h e Workers' Compensation Court. The following i s s u e s a r e presented t o t h i s Court f o r review: 1. Whether t h e r e was s u f f i c i e n t evidence t o support t h e Workers' Compensation C o u r t ' s holding t h a t claimant was en- t i t l e d t o a lump sum payment of f u t u r e b e n e f i t s . 2. Whether claimant i s e n t i t l e d t o a t t o r n e y f e e s and c o s t s . Claimant William T. Polich, a longtime r e s i d e n t of Butte, was 62 years o l d i n 1980 when t h i s a c t i o n arose. H e had worked most of h i s l i f e a t unskilled and p h y s i c a l l y demanding jobs. O n January 29, 1979, while employed by Whalen's O.K. T i r e Warehouse, Polich s u f f e r e d a back i n j u r y which was accepted a s compensable by Glacier General Assurance Company. Polich has been receiving biweekly b e n e f i t payments s i n c e t h e d a t e of h i s i n j u r y . I n March of 1979, Polich underwent a s u r g i c a l laminectomy t o c o r r e c t a herniated d i s c . Despite t h e surgery, he continued t o experience pain i n h i s lower back, buttocks and l e g s . The orthopedic surgeon, who t r e a t e d Polich, recommends t h a t Polich r e f r a i n from engaging i n any occupation which would r e q u i r e overhead work, bending, stooping, crawling, d r i v i n g o r l i f t i n g more than 20 pounds. W i l l i a m Polich owns h i s own house and c a r ; he has c e r t i f i c a t e s of d e p o s i t worth $13,000 and $3,000 i n a savings account. H e and h i s wife have a combined income of $1,887 p e r month. P o l i c h ' s wife works a s a r e c e p t i o n i s t a t t h e Department of Radiology a t S t . James Hospital i n Butte. She has b r i t t l e d i a b e t e s , migraine headaches, and c i r c u l a t o r y problems which make it d i f f i c u l t f o r her t o continue working. She was 6 2 y e a r s o l d i n 1980, is e l i g i b l e f o r retirement b e n e f i t s and d e s i r e s t o retire. O n J u l y 7 , 1980, claimant p e t i t i o n e d t h e Workers' Compensation Court t o g r a n t him a lump s u m s e t t l e m e n t s o t h a t he and h i s wife could sell t h e i r home and move south t o a more h o s p i t a b l e climate, r e l i e v i n g themselves of t h e stress and discomfort caused them by Montana's more severe winters. The p e t i t i o n a l l e g e d t h a t Polich experienced pain when he attempted "even t h e s l i g h t e s t exertion." Claimant re- q u e s t s t h e lump sum payment f o r h i s projected move because t h e c o s t of l i v i n g i s considerably higher i n Phoenix, where t h e Polichs plan t o l i v e , and because, due t o t h e depressed economy i n Butte, claimant cannot expect t o r e c e i v e more than around $22,000 from t h e s a l e of h i s home i n Butte. Claimant's e f f o r t s t o n e g o t i a t e a lump sum s e t t l e m e n t with Glacier General had been unsuccessful. A hearing was held on October 20, 1980. Findings of f a c t and conclusions of law subsequently entered determined, among o t h e r things, (1) t h a t claimant i s permanently and t o t a l l y disabled; ( 2 ) t h a t claimant i s a prudent man, a b l e t o handle h i s f i n a n c i a l a f f a i r s ; ( 3 ) t h a t a lump sum s e t t l e m e n t would be i n claimant's b e s t i n t e r e s t s ; ( 4 ) t h a t i f t h e p a r t i e s could n o t settle upon t h e amount of t h e lump sum payment, t h e Workers' Compensation Court would do so a t a later d a t e ; ( 5 ) t h a t t h e Workers' Compensation Court would a l s o determine a t a l a t e r d a t e whether a t t o r n e y f e e s would be awarded and t h e amount of those f e e s . Appellant, Glacier General, has obtained a s t a y of t h e order of t h e Workers' Compensation Court; claimant w i l l continue receiving biweekly b e n e f i t payments pending t h e outcome of t h i s appeal. Appellant has n o t contested t h e Workers' Compensation Court's j u r i s d i c t i o n o r its finding t h a t claimant i s permanently and t o t a l l y disabled within the meaning of s e c t i o n 39-71- 116 ( 1 3 ) , MCA. The f i r s t i s s u e , regarding t h e nature and s u f f i c i e n c y of the evidence presented i n support of a conversion of f u t u r e biweekly b e n e f i t s t o a lump sum payment, has been addressed by t h i s Court i n many cases. S t a t u t o r y a u t h o r i t y f o r the conversion i n t o a lump sum of biweekly payments provided f o r under the Workmen's Compensation Act i s found i n s e c t i o n 92-715 R.C.M., 1947, now s e c t i o n 39-71-741, MCA. I n 1979, s e c t i o n 39-71-741, MCA, was amended t o g i v e t h e Workers' Compensation Court t h e a u t h o r i t y t o settle d i s p u t e s concerning lump s u m settlements where an i n s u r e r and a claimant disagreed. Willoughby v. Mont.- Arthur G. McKee & Co. (1980), - , 609 P.2d 700, Mont. I n a r e c e n t case, Utick v. Utick (1979), - - I 593 P.2d 739, 741, 36 St.Rep. 799, 801-802, t h i s Court discussed t h e broad p r i n c i p l e s governing lump sum payments: "The general r u l e i s t h a t payments under t h e Workmen's Compensation Act a r e periodic. Lump sum settlements a r e an exception t o t h e general r u l e . [ C i t a t i o n s omitted. ] This does n o t mean, however, t h a t lump sum awards a r e looked on with disfavor. They should be awarded without hesitancy 'where t h e b e s t i n t e r e s t s of the p a r t i e s demand it.' [Laukaitis v. S i s t e r s of Charity of Leavenworth (1959), 135 Jlont. 469, 474, 342 P.2d 752, 755.1 Each case f o r a lump sum payment stands o r f a l l s on i t s own merits. Codling v. Aztec W e l l Servicing Co. (1976), 89 N.M. 213, 549 P.2d 628." I n o t h e r c a s e s where t h i s Court has considered t h e Workers' Compensation Court's decision t o award o r deny a lump sum settlement, we have s t a t e d t h a t t h a t decision w i l l n o t be i n t e r f e r e d with on appeal unless t h e r e has been an apparent abuse of d i s c r e t i o n . Utick v. Utick, supra; Kent v. S i e v e r t (1971), 158 Mont. 79, 489 P.2d 104. The f i n d i n g s of t h e lower t r i b u n a l o r board w i l l be presumed c o r r e c t and affirmed i f supported by s u b s t a n t i a l evidence. Willoughby, supra, 609 P.2d a t 702, 37 St.Rep. a t 623, and cases t h e r e c i t e d . The Workers' Compensation Court o r board i s "more favorably s i t u a t e d than [ t h i s Court] t o f a m i l i a r i z e i t s e l f with t h e circumstances surrounding t h e a p p l i c a n t , t o consider h i s needs, and t h e r e s u l t s which probably w i l l follow a c t i o n g r a n t i n g o r denying the a p p l i c a t i o n . . ." Willouqhby, supra, 609 P.2d a t 704, 37 St.Rep. a t 625, ( c i t a t i o n omitted). Appellant maintains t h a t the evidence before t h e Workers' Compensation Court was too scanty t o support its conclusion t h a t a lump sum s e t t l e m e n t w i l l b e s t serve t h e c l a i m a n t ' s i n t e r e s t s . Appellant claims a c o n t r a d i c t i o n e x i s t s i n t h e c o u r t ' s finding t h a t claimant wants t o move t o a warm climate although claimant has not r e a l l y checked o u t the c o s t of l i v i n g i n Phoenix o t h e r than t o f i n d t h a t it would c o s t more than l i v i n g i n Butte, so t h a t t h e move might a c t u a l l y be detrimental t o claimant and h i s wife. W e do note t h a t more d e t a i l e d f a c t s regarding t h e a n t i c i p a t e d c o s t s and expenses should have been presented by claimant. The evidence d i d show t h a t claimant has been warned by h i s physician t o avoid stooping, bending, crawling, heavy l i f t i n g and overhead work; t h e s l i g h t e s t physical e x e r t i o n i s p a i n f u l t o him. H i s wife i s ill with d i a b e t e s , migraine headaches and impaired c i r c u l a t i o n . The claimant has i n d i c a t e d t h a t he and h i s wife keep mostly t o themselves; they have few c l o s e f r i e n d s l e f t i n t h e area. While l i t t l e evidence was submitted i n comparing Butte and Phoenix winter l i v i n g conditions, t h e f a c t s a r e s u f f i c i e n t t o show t h a t l i f e away from below zero weather, heavy snowfall and r u t t e d i c y roads and s t r e e t s would be i n the b e s t i n t e r e s t s of t h i s ill and aging couple. This Court has s t a t e d t h a t t h e i n t e r e s t s of s o c i e t y a r e u s u a l l y b e s t served by having d i s a b i l i t y payments made p e r i o d i c a l l y . "The purpose of [ t h e p e r i o d i c payment] method i s t o preclude any p o s s i b i l i t y of an imprudent employee o r dependent wasting t h e means f o r support and thereby becoming a burden upon society. [ C i t a t i o n omitted, 1 " Laukaitis, supra, 135 Mont. a t 472, 342 P.2d a t 754. But t h e Workers' Compensation Court has found " t h a t t h e claimant i s a prudent man, a b l e t o handle h i s f i n a n c i a l a f f a i r s . . ." The record i n d i c a t e s t h a t Polich i s solvent, and t h a t h i s wife i s e l i g i b l e f o r r e t i r e m e n t b e n e f i t s . I t i s only the a n t i c i p a t e d expense of t h e move t o Phoenix t h a t gives r i s e t o h i s r e q u e s t f o r a lump sum payment. I t i s p r e c i s e l y t h i s type of human need and f i n a n c i a l burden t h a t s e c t i o n 39-71-741, MCA i s designed t o cover. Without a lump sum payment of b e n e f i t s , claimant and h i s wife w i l l be unable t o make a move t h a t i s c l e a r l y i n t h e i r b e s t i n t e r e s t s considering t h e i r age and d e t e r i o r a t e d health. I n a l l l i k e l i h o o d , once s e t t l e d i n Phoenix t h e Polichs w i l l continue t o l i v e , a s they have i n Butte, q u i e t l y and within t h e i r means. W e f i n d t h e r e i s s u b s t a n t i a l evidence upon which t h e Workers' Compensation Court could base i t s conclusion t h a t a lump sum settlement i s i n t h e b e s t i n t e r e s t s of t h e claimant. There i s no abuse of d i s c r e t i o n i n i t s judgment t h a t , i n accordance with s e c t i o n 39-71-741, MCA, Polich i s e n t i t l e d t o a conversion of h i s f u t u r e biweekly b e n e f i t payments i n t o a lump sum payment. The second i s s u e r a i s e d is whether t h e claimant i s e n t i t l e d t o a t t o r n e y f e e s and c o s t s . Appellant contends a t h a t , s i n c e it has a t a l l t i m e s been complying with t h e Workers' Compensation Act, claimant i s n o t e n t i t l e d t o recover a t t o r n e y f e e s and c o s t s . Compliance o r noncompliance with t h e Workers' Compensation Act i s n o t r e l e v a n t t o t h i s issue. The award of a t t o r n e y f e e s and c o s t s i n t h i s case i s governed by s e c t i o n 39-71- 612, MCA, which s t a t e s : " ( 1 ) I f an employer o r i n s u r e r pays o r tenders payment of compensation under chapter 71 o r 72 of t h i s t i t l e , b u t controversy r e l a t e s t o t h e amount of compensation due and t h e settlement o r award i s g r e a t e r than the amount paid o r tendered by t h e employer o r i n s u r e r , a reasonable a t t o r n e y ' s f e e a s e s t a b l i s h e d by t h e d i v i s i o n o r t h e workers' compensation judge i f t h e case has gone t o a hear- i n g based s o l e l y upon t h e d i f f e r e n c e between t h e amount s e t t l e d f o r o r awarded and t h e amount tendered o r paid, may be awarded i n a d d i t i o n t o the amount f o r compensation. ( 2 ) When an a t t o r n e y ' s f e e i s awarded a g a i n s t an employer o r i n s u r e r under t h i s s e c t i o n t h e r e may be f u r t h e r assessed a g a i n s t t h e employer o r i n s u r e r reasonable c o s t s , f e e s , and mileage f o r necessary witnesses attending a hearing on t h e c l a i m a n t ' s behalf. Both t h e n e c e s s i t y f o r t h e w i t - ness and t h e reasonableness of t h e f e e s must be approved by t h e d i v i s i o n o r t h e workers' compensa- t i o n judge. " The claimant has prevailed i n a hearing where t h e s o l e controversy was t h e d i f f e r e n c e between t h e amount awarded and t h e amount tendered. This m e e t s t h e s t a t u t o r y standard. This Court f i n d s t h a t t h e claimant i s e n t i t l e d t o reasonable a t t o r n e y f e e s and c o s t s within t h e meaning of s e c t i o n 39-71- 612, MCA. W e a f f i r m t h e judgment of t h e Workers' Compensation Court. I t i s t h e function of t h e lower c o u r t t o determine t h e amount of awards and f e e s , a s it i s t h e function of t h i s Court t o review t h e d e c i s i o n s of t h e lower courts. There- f o r e , w e remand t h i s case t o the Workers' Compensation Court f o r a determination of t h e amount of t h e lump sum payment and a t t o r n e y f e e s and c o s t s t o which c l a i m a n t i s e n t i t l e d . W e Concur: Chief J u s t i c e L ( a h e , ~jg~h, J u s t i c e s