NO. 89-66 

IN THE SUPREME COIJRT OF THE STATE OF MONTANA 

MARIE MELLEM , 

Claimant and Appell-ant, 

-vsKALISPELL TJAUNDRY & DRY CLEANERS, 

Empl-oyer , and 

STATE CONPENSATION INSURANCE FUND, 

Insurer and Respondent. 

APPEAL FROM: The Workers' Compensation Court, 

The Honorahl e Timothy Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Allan M. McGarvey; McGarvey, Feberling, Sullivan and 

McGarvey, Kalispell, Montana 

For Respondent: 

Steven J. Shapiro, Chief Legal Counsel and Charles 

Adams, Legal Counsel, Div. of Workers' Compensation, 

Helena, Montana 

L6, : 

c-3 ., ' ..,, Submitted on Briefs: April 27, 1989 ?$ - 0 ; 

T; , a Decided: June 1, 1989 

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Mr. Justice R. C. McDonough del.iverecJ the Opinion 0.F +.he 

Court. 

This appeal concerns the requirements for perfecting an 

appeal to the Montana Workers' Compensation Court under the 

terms of the Montana Occupational Disease Act (MODA) . Mari-e 

Mellem appeals from the court's order dismissing her appeal. 

for failure to comply with the jurisdictional requirements of 

MODA. We reverse and remand with instructions. 

Mellem presents three issues 'or review: 

1. Did Mellem fail to perfect an appeal to the Workers' 

Compensation Court because her request for rehearing was 

denominated "Statement of Exceptions"? 

2. Did the Workers' Compensation Court abuse its 

discretion by dismissing Mellem's appeal. without granting 

Leave to seek rehearing and later application for appeal? 

3. Has Me1I.em been denied due process of law bv the 

procedural errors of the Division o-F Workers' Compensation 

and the Workers' Compensation Court.? 

Mellem was employed by a Kalispell laundry from 1981. 

until 1986. She suffers from severe chronic obstructive 

pulmonary disease along with chronic pneumonia. Mellem 

alleges that her lung problems are due in part to her 

exposure to certain fumes and particles while employed at the 

laundry. She filed a claim for occupational disease benefits 

with the State Compensation Insurance Fund, which denied 

liability. Mellem's claim was then referred to the Division 

of Workers' Compensation, which in turn referred her to a 

member of the Occupational Disease Panel for medical 

examination. 

Based on the report of the medical examination, the 

Division issued an order stating its preliminary 

determination that Mellem would not be entitled to benefits. 
Mellem then requested a hearing before the Division, which 

bras held before a Hearing Examiner. After reviewing the 

record of Mellem's cl-aim, the Hearing Examiner issued his 

Findings of Fact, Conclusions of Law and Order, finding 

Mellem not entitled to occupational disease benefits. This 

document also contained a paragraph entitled "Notice", which 

reads in part as follows: 

You are hereby notified that you have the 

right to file exceptions and to present 

briefs and oral argument to the 

Administrator of the Division of Workers" 

Compensation who will decide whether or 

not to adopt or modify the foregoing 

Proposed Order. 

According to Mellem's brief to this Court, her counsel. 

contacted the Division to verify that the "exceptions" 

procedure was the same as the "rehearing" procedure required 

by § 39-72-61.2, MCA, and was informed that it was in fact the 

same. 

Mell-em then filed a Statement of Exceptions with the 

Division. The Administrator of the Pi-vision reviewed the 

Hearing Examiner's Findings of Fact, Conclusions of Law and 

Order, as well as the record of Mellem's claim. He then 

issued a Final Order, which again concluded that Mellem was 

not entitled to benefits. The Final Order reads i.n part: 

This Final Order is signed by the 

Administrator of the Division of Workers' 

Compensation under the authority of 

Section 39-72-202, MCA. Any party in 

interest may appeal this order to the 

Workers' Compensation Court as provided 

in Sections 39-71-2401 and 39-72-612, 

.MCA . 

Mellem thereafter filed an appeal with the Workers' 

Compensation Court. The court determined that it lacked 

jurisdiction to hear Mellem's appeal. According to the 
court, Mellem had not perfected an appeal, because she had 

failed to request a rehearing before the Division as required 

by $ 39-72-612, MCA. The court thus felt "compelled, - sua 

sponte, to dismiss" Mellem's appeal, which it did. This 

appeal followed. 

The Workers' Compensation Court began its discussion by 

reciting the basis of its jurisdiction under MODA, which is 

defined by $ 39-72-612, MCA. The court noted the specific 

requirement in 5 39-72-612 (l), MCA, that in order to 

perfect an appeal, "the appealing party must request a 

rehearing before the division." According to the court, a 

careful review of the record failed to disclose such a 

request by Mellem. 

The Workers' Compensation Court was correct in that its 

jurisdiction is statutorily defined in 5 39-72-612, MCA, and 

that the record in Mellem's case does not conform strictly to 

that statute. There is no document entitled "Request for 

Rehearing" to be found in the file. However, the reason for 

the absence of such a request appears on the face of the two 

Division orders quoted above. The court noted that the 

record of this case showed "some confusion over procedures 

before the Division. " The court cited as examples the 

improper labelling of orders issued by the Division, which 

contained instructions for procedures not discussed in MODA. 

The court concluded that these variations were in form only, 

and did not affect Mellem's entitlement to an appeal. We 

disagree. 

This situation has not been addressed by this Court 

under MODA. Fowever, we have held in similar situations 

under the statute of limitations in the Workers' Compensation 

Act that where misstatements hy an employer or insurer 

prevent a claimant from filing a Workers' Compensation claim 

in a timely fashion, or mislead the claimant into believing 
that no claim can or need be filed, the doctrine of equitable 

estoppel applies to to]-1 the limitation period and allow 

filing of the claim. Davis v. Jones (1983), 203 Mont. 464, 

661 P.2d 859. The doctrine is equally applicable to the 

facts in this case, as is the maxim "No one can take 

advantage of his own wrong." Section 1-3-208, MCA. 

There are essentially six elements to equitable 

estoppel: 

"1. There must be conduct--acts, languaqe, or 

silence--amounting to a representation or a 

concealment of material facts. 2. These facts must 

be known to the party estopped at the time of his 

said conduct, or at least the circumstances must be 

such that knowledge of them is necessarily imputed 

to him. 3. The truth concerning these facts must 

be unknown to the other party claiming the benefit 

of the estoppel, at the time when it was acted upon 

by him. 4. The conduct must be done with the 

intention, or at least with the expectation, that 

it will he acted upon by the other party, or under 

such circumstances that it is both natural and 

probable that it will. be so acted upon. . . . 5. The 

conduct must be relied upon by the other party, 

and, thus relying, he must be led to act upon it. 

6. He must in fact act upon it in such a manner as 

to change his position for the worse ...." 

Davis, 661 P.2d at 861 (quoting Lindbolm v. ~mpl-oyers' 

T,iability Assurance Corp. (19301, 88 Mont. 488, 494, 795 

1007, 1009). 

As to the first element, the conduct at issue here is 

reflected in the language of the Division's orders. The 

Hearing Examiner's order stated that Mellem could file 

exceptions with the Division. Mellem's counsel asserts that 

he contacted the Division to confirm that the "excepti.onsW 

procedure was the same as the "rehearing" procedure, and was 

told that it was in fact the same. While this statement is 

not disputed in the Division's brief to this Court, assuming 

it to be untrue does not negate the Division's conduct. It 
is apparent from the face of the Division Administrator's 

Final Order that the Division considered a request for 

rehearing to have been made. 

The second element of estoppel is also present. 

Knowledge of the proper procedures under MODA can certainly 

be imputed to the Division. The third element is evident 

from the course of conduct of Mellern's attorney and the 

Division. Mellem's attorney could not have known that the 

Division did not treat an exceptions procedure as a rehearing 

procedure, especiallv given the Division's continued conduct 

as if proper procedures were being followed. The fourth 

element is evident from the fact that the Division's conduct 

took the form of orders. There was clearly an expectation 

that Mellem's counsel would act in accordance with those 

orders. The fifth and sixth elements are self-evident. This 

opinion is the result of Mellem's detrimental reliance on the 

Division's conduct. 

The Division cannot now be heard to argue that Mellem's 

counsel was on notice of the statutory requirements for 

perfecting an appeal to the Workers' Compensation Court, and 

therefore at fault for the appeal's dismissal. The Division 

is estopped from doing so by its own actions. Taking that 

position also violates the maxim quoted above. 

We therefore reverse the decision of the Workers' 

Compensation Court dismissing Mellem's appeal, and remand 

with instructions to return the case to the Division to 

afford Mellem the opportunity to perfect her appeal in 

accordance with 5 39-72-612, MCA. 

We Concur: 
4TVA 

Chief Justice