No. 88-186 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

RITA GOULD, 

Claimant and Respondent, 

-vsCOUNTY MARKET/SUPER VALU STORES, 

Employer, 

and 

LIBERTY MUTUAL FIRE INSURANCE COMPANY, 

Defendant and Appellant. 

APPEAL FROM: The Workers' Compensation Court, The Honorable 

Timothy Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

~OS-= 

Garlington, Lohn & Robinson; Larry Missoula, 

Montana 

For Respondent: 

Linnell, Newhall & Martin; Richard J. Martin, Great 

Falls, Montana 

Submitted on Briefs: July 21, 1988 

Decided: Septefnber 8, 1988 

* A~~JL Ih, 4- 

clerk 
The symptoms persisted, rendering Gould temporarily totally 

disabled. 

The Workers' Compensation Court appointed a Hearing 

Examiner for Gould's claim. The examiner held a hearing at 

which testimony was taken and evidence introduced. He subsequently issued his Findings of Fact and Conclusions of Law 

and Proposed Judgment. He denied Gould's claim on the ground 

that she had failed to notify her employer of her injury 

within 60 days as required by S 39-71-603, MCA (1985). The 

Hearing Examiner's proposed judgment was adopted by the court 

in an order issued the same day as the proposed judgment. 

The court's order also stated that any party to the dispute 

would have 20 days to request a rehearing. 

Gould timely filed her Motion For New Trial, in which 

she alleged that the Hearing Examiner did not consider two 

items of evidence she considered crucial. Gould pointed to a 

handwritten memo by the store manager in which he noted 

suggesting to Gould that she begin her retirement if working 

conditions at the store were detrimental to her health. She 

also cited an insurance claim form signed by Gould and the 

store manager on which Gould had answered "yes" to the question, "Is illness or injury due to Claimant's occupation?" 

Both documents were dated within 60 days of the date of 

Gould's injury, and she contended that they provided actual 

notice to her employer of her injury and its relation to her 

employment. The court granted Gould's motion in its order of 

March 16, 1988: 

These two written notices are sufficient to establish that actual notice was given to the employer 

within 60 days, as required by Section 39-71-603, 

MCA . 

The Court concludes that it erred in not recognizing the two written statements in evidence cited 

by claimant which do establish notice and that 
Mr. Justice R. C. McDonough delivered the Opinion of the 

Court. 

Liberty Mutual Fire Insurance Company (Liberty) appeals 

from the order of the Workers' Compensation Court of the 

State of Montana granting plaintiff Rita Gould's motion for a 

new trial. We affirm. 

Liberty frames four issues for review by this Court: 

1. Whether the grounds on which the Claimant based her 

motion for a new trial were insufficient as a matter of law 

to allow the Workers' Compensation Court to grant a new 

trial. 

2. Whether the Workers' Compensation Court Judge may 

grant a new trial by reversing his Hearing Examiner's findings of fact. 

3. If the Worker's Compensation Court Judge may grant a 

new trial by reversing his Hearing Examiner's findings of 

fact, then may he do so by substituting his judgment for that 

of his Hearing Examiner's of the credibility (i.e. competency) of a witness whose demeanor and character his Hearing 

Examiner has observed and judged but who he, the Workers' 

Compensation Court Judge, has never observed. 

4. Whether the Claimant complied with the 60-day notice 

requirement of § 39-71-603, MCA (1985). 

On September 8, 1986, Rita Gould filed a Petition For 

Hearing in the Montana Workers' Compensation Court. She 

alleged her preexisting conditions of cervical and lumbar 

spondylosis had been aggravated in the course of her employment, leading to an incident on May 26, 1985, when she experienced dizziness and severe neck, shoulder and back pain 

while at work. According to Gould's petition, the incident 

was a "culmination of symptoms" related to her employment. 
manifest injustice would be done if claimant were 

not granted a rehearing. 

This appeal followed. 

Our review of the record and relevant authorities indicates that the four issues framed by Liberty can be restated 

as one. What is really at issue in this appeal is whether 

the Workers' Compensation Court Judge can order a new trial 

on the ground that the Hearing Examiner apparently disregarded or was not aware of pieces of evidence that were 

crucial to the case. We hold that the judge has that power. 

Both parties acknowledge the court's ability to grant a 

new trial under rules 2.52.340 and 2.52.344 of the Administrative Rules of Montana. The parties disagree, however, on 

the propriety of the court's grounds for granting a new trial 

in this case. 

Liberty sets out two inconsistent arguments that sufficient grounds for a new trial do not exist. The first argument states the decision was improper under sections of the 

civil procedure code. The second argument is based on rules 

of administrative procedure. The inconsistency of these 

positions is symptomatic of the unique position occupied by 

the Workers' Compensation Court. On one hand, the Workers' 

Compensation Court is not a full-fledged District Court. Its 

jurisdiction is limited to workers' compensation matters, and 

its procedures are less formal. For example, 5 39-71-2903, 

MCA (1985), states that the Montana Administrative Procedure 

Act (MAPA) applies to the court's proceedings, while the 

rules of evidence do not. On the other hand, the court's 

decisions are something more than administrative agency 

decisions. Agency decisions are normally appealable to 

District Court, but $ 39-71-2904, MCA (1985) , provides that 

decisions of the Workers' Compensation Court are appealed 

directly to this Court. Liberty's reliance on both civil and 
administrative procedure is thus warranted. Both arguments 

are supported by authority from this Court. However, the 

focus of Liberty's argument is misplaced. 

We note that both of Liberty's arguments are premised on 

the limited power of the Workers' Compensation Court to 

review oral testimony. Liberty seeks to take advantage of 

this limited power of review by casting Gould's motion as a 

disagreement with the weight given her own testimony before 

the Hearing Examiner. This is a mischaracterization of 

Gould's argument, which is based on two written documents in 

evidence before the examiner. In addition to granting the 

power to order a new trial, 2.50.340, ARM, requires that the 

court conduct its review on the basis of the complete record, 

with its decision based on the evidence as a whole. Liberty's premise is thus faulty, and its arguments proceed on a 

tangent concerning the credibility and demeanor of witnesses 

that bears little relation to the issue at hand. 

Liberty's first argument suffers as a result of this 

faulty premise. Relying on our decision in Walter v. Evans 

Products Co. (1983), 207 Mont. 26, 672 P.2d 613, Liberty 

asserts that the authority of the Workers' Compensation Court 

to grant a new trial is governed by the general civil procedure standards in ss 25-11-102 and 103, MCA (1985): 

The former verdict or other decision may be vacated 

and a new trial granted on the application of the 

party aggrieved for any of the following causes 

materially affecting the substantial rights of such 

party: 

1) irregularity in the proceedings of the court, 

ury, or adverse party or any order of the court or 

.buse of discretion by which either party was 

prevented from having a fair trial; . . . 

(3) accident or surprise which ordinary prudence 

could not have guarded against; 
(4) newly discovered evidence material for the 

party making the application which he could not, 

with reasonable diligence, have discovered and 

produced. at trial; 

. . . 

Section 25-11-102, MCA (1985). 

No new trial may be granted in cases tried by the 

court without a jury, except on the grounds mentioned in subsections (1) , (3), and (4) of 

25-11-102. 

Section 25-11-103, MCA (1985). 

According to Liberty, none of these grounds were argued by 

Gould in her motion, nor are any presented by the record of 

this case. Rather, Liberty asserts that Gould merely disagreed with the court as to the weight and relevance of her 

own testimony. 

Liberty relies on Walter for the proposition that disagreement with the weight given to testimony is an insufficient ground for a new trial as a matter of law. However, 

the Walter decision did not turn on the review of oral testimony. The party seeking a new trial in that case argued (1) 

the court should have reopened the case to consider newly 

discovered evidence, and (2) there was a complete lack of 

probative, credible evidence in the record to support a 

number of the court's findings. Walter, 672 P.2d at 616. 

When we reviewed the Walter decision, we looked to 

§§ 25-11-102 and 103, MCA (1985), as the most directly applicable guide on the question of newly-discovered evidence. 

The issue turned on the fact that the moving party had custody of the evidence in question. In contrast with Walter, the 

question in this case is whether the examiner's proposed 

decision was actually contrary to evidence in the record. 

The question of newly-discovered evidence is not presented, 
and the civil procedure statutes cited by Liberty are not 

applicable. 

Liberty's second argument looks to the provisions of 

MAPA. Liberty points out that the Division of Workers' 

Compensation is an administrative agency, and that under our 

decision in Hock v. Lienco Cedar Products (Mont. 1981), 634 

P.2d 1174, 38 St.Rep. 1598, the rules of civil procedure are 

not directly applicable to the Workers' Compensation Court. 

Liberty asserts that under MAPA--specifically S 2-4-621, MCA 

(1985)--the Workers' Compensation Court Judge "sits in a form 

of appellate review of his hearing examiner's proposed decision," and is limited in his review of the hearing examiner's 

findings of fact. In relevant part, the statute states: 

The agency in its final order may reject or modify 

the conclusions of law and interpretation of administrative rules in the proposal for decision but 

may not reject or modify the findings of fact 

unless the agency first determines from a review of 

the complete record and states with particularity 

in the order that the findings of fact were not 

based upon competent substantial evidence or that 

the proceedings on which the findings were based 

did not comply with essential requirements of law. 

Section 2-4-621 (3), MCA (1985). Liberty also notes that 

2.52.340, ARM, contains a similar standard: 

Findings of fact made by a hearing examiner will 

not be rejected or revised unless the Court first 

determines from a review of the complete record and 

states with particularity in the order that the 

findings of fact were not based upon competent 

substantial evidence.. . 

2.52.340 (3) (a) , ARM. Liberty argues that under these standards, it should have been impossible for the court to grant 

Gould's motion. According to Libertv, the decision in this 

case required the court to substitute its judgment for that 
of the examiner as to the weight given to testimony of 

witnesses at the hearing. 

As with its first argument, Liberty's application of 

MAPA suffers from the mistaken premise that only Gould's oral 

testimony was before the Workers' Compensation Court. Liberty is correct in its assertion that the judge in this case 

sat in a form of review of the examiner's proposed decision. 

However, Liberty's focus on the standard of review exercised 

by agencies under § 2-4-621, MCA (1985) is inappropriate. As 

we stated above, the procedure in the Worker's Compensation 

Court is not the same as that followed by an agency. We have 

previously noted this fact when distinguishing case authority 

dating from before the court's creation. 

[The party's] principal case was handed down before 

the Worker's Compensation Court was established. 

At the time of that case, the division conducted 

-- its own contested case hearings -- like all other 

agency~ . 

Hock, 634 P.2d at 1178 (emphasis added). While the Workers' 

Compensation Court is not a full-fledged District Court, 

§§ 39-71-2901 through 39-71-2909, MCA (1985), grant the court 

authority broader than that exercised by an agency: 

Although the Workers' Compensation Court is not 

vested with the full powers of a District Court, it 

nevertheless has been given broad powers concerning 

benefits due and payable to claimants under the 

Act. It has the power to determine which of several parties is liable to pay the Workers' Compensation benefits, or if subrogation is allowable, what 

apportionment of liability may be made between 

insurers, and other matters that go beyond the 

minimum determination -- of the benefits payable -- to an 

employee. 

State ex rel. Uninsured ~mployers' Fund v. Hunt (~ont. 1981), 

625 P.2d 539, 542, 38 St.Rep. 421, 425 (emphasis added). One 
"other matter" specifically provided for in 2.52.340, ARM, is 

the power to grant a new trial. 

In view of the broader powers exercised by the court, we 

hold the standards for judicial review of a master's report 

found at Rule 53 (e) , M.R.Civ.P., are more applicable to the 

facts of this case than the standard urged by T,iberty: 

Report. (1) Contents and filing. The master 

shall prepare a report upon the matters submitted 

to him by the order of reference and, if required 

to make findings of fact and conclusions of law, he 

shall set them forth in the report ... (2) In nonjury actions. In an action to be tried 

without a jury the court shall accept the master's 

findings of fact unless clearly erroneous... The 

court after hearing may adopt the report or may 

modify it or may reject it in whole or in part or 

may receive further evidence or may recommit it 

with instructions. 

The Workers' Compensation Court Judge appointed the Hearing 

Examiner to hear the evidence in this case, but it was for 

the court to make the final decision. The examiner's find-, 

ings, conclusions and proposed decision were submitted to the 

court for its approval. 

When reviewed in light of Rule 53(e), the record sup-- 

ports the court's decision to grant a new trial. The memo 

and insurance form indicate that Gould's employer knew of her 

injury and knew--or should have known--that the injury was 

related to her employment. This constitutes notice. The 

Hearing Examiner's denial of Gould's claim was based on the 

lack of such notice. As Gould's properly-filed motion served 

to point out, the examiner's findings of fact were therefore 

clearly erroneous. The court was correct in holding that 

proper notice had been given, and a new trial should be 

granted. 
We affirm the decision of the Workers' Compensation 

Court that Gould gave proper notice of her injury, and remand 

the case for a new trial on the merits of her claim. 

&e* 

Justice 

Chief Justice