IN THE STJPREME COURT OF THE STATP OF MONTANA 

1989 

WILLIAM WHITCHER, 

Claimant and Appellant, 

-vsWINTER HARDWARE COMPANY, 

Employer, 

and 

PACIFIC EMPLOYERS INSURANCE CO., 

Defendant and Respondent. 

APPEAL FROM: The Workers' Compensation Court, The Honorable ~imothy 

Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Lloyd E. Hartford, Billings, Montana 

For Respondent: 

Michael P. Heringer, Billings, Montana 

Filed: 

Submitted on Briefs: Jan. 5, 1989 

Betided: February 23, 1989 
Mr. Justice Fred J. Weber delivered the Opinion of the Court. 

The claimant, Mr. Whitcher, filed a petition with the 

Workers' Compensation Court to reopen his Full and Final 

Compromise Settlement, to have medical benefits paid, and to 

receive vocational rehabilitation. The court denied the 

request to reopen the settlement agreement, but ordered that 

claimant is entitled to medical benefits, a 20% penalty on 

those medical benefits, rehabilitation, and costs and attorney' fees on the prevailing issues. Mr. Whitcher appeals that 

portion of the court's decision denying him the opportunity 

to reopen his full and final compromise settlement. We 

affirm. 

The issue is whether the Workers' Compensation Court 

erred in refusing to allow the claimant to reopen his full. 

and final compromise settlement based on the grounds of 

mutual mistake. 

On December 18, 1978, William Whitcher suffered an 

industrial accident arising out of and in the course of his 

employment with Winter Hardware in Billings, Montana. Mr. 

Whitcher was employed as a laborer for the hardware wholesaler, and hurt his back while attempting to move some angle 

iron. Although injured, he continued to work for the employer until January 12, 1979 before seeking medical treatment. 

Mr. Whitcher filed a timely claim for compensation and 

Pacific Employers Insurance, who insured Winter Hardware, 

duly accepted liability and paid biweekly benefits and medical expenses as incurred. Mr. Whitcher's temporary total 

weekly benefits were $95.53 and his permanent partial disability rate was $94.00 per week. He received the following 

lump sum advances during 1979, which were to be credited 

against his right to future permanent partial disability 

payments : 
1. October 1, 1979 - $750.00 

2. November 5, 1979 - $500.00 

3. November 21, 1979 - $1000.00 

At his employer's insistence, Mr. Whitcher sought medical treatment on January 9, 1979, due to pain in his lower 

back which radiated into his lower extremities. On March 15, 

1979, he underwent back surgery in an attempt to alleviate 

the pain. 

Seven months after surgery, the orthopedic surgeon who 

performed the surgery gave Mr. Whitcher an estimated impairment rating of 20% whole body permanent physical impairment 

and loss of function. That 20% impairment rating was confirmed by the doctor again on March 13, 1980, one year after 

surgery. On March 20, 1980, Mr. Whitcher signed a Petition 

for Full and Final Compromise Settlement in the amount o-F 

$8,000.00. Initial-ly, the proposed settlement offer of 

$8,000.00 was rejected by Levi Loss of the Compliance Bureau. 

However, Mr. Loss suggested to the claims adjuster that the 

the Bureau would approve the settlement if an additional. 

payment of 26 weeks of benefits at the claimant's temporarv 

total rate, or $2,483.78, was added to the original $8,000.OC 

settlement figure. The Workers Compensation Court found that 

Mr. Loss was aware of Mr. InJhitcherls 20% impairment rating 

which would have entitled him to 7-00 weeks of benefits at +he 

rate of $94.00 or some $9,400.00. 

Eventually, the claims adjuster agreed to amend the 

petition to include the additional payments. The settlement 

was processed and approved by the appropriate authorities in 

April 1980. Mr. Whitcher continued to receive benefits 

through September 11, 1980. Thereafter, he was notified by 

letter dated September ??, 1980 that he would no longer 

receive benefit-c pursuant to the compromise settlement 

agreement. 
On January 27, 1987, Mr. Whitcher filed a petition with 

the Workers' Compensation Court to reopen the 1.980 settlement. The court denied Mr. Whitcher's request based on hj.s 

failure to comply with the applicable statute of limitations. 

On appeal, Mr. Whitcher argues that he is entitled to reopen 

his settlement based on the mutual mistake of the parties in 

settling his claim, and does not address the applicability of 

the statute of limitations. For purposes of our review, we 

will first discuss the court's findings as they relate to Mr. 

Whitcher's claim of mutual mistake and then we will review 

the court's decision on the applicability of the statute of 

limitations. 

This Court has allowed the recission of a full and final 

settlement agreement based on a mutual mistake of fact in 

Kienas v. Peterson (Mont. 1980), 624 P.2d 1, 37 St.Rep. 1747. 

A mistake of fact is defined by statute as follows: 

Mistake of fact is a mistake not caused by the 

neglect of a legal duty on the part of the person 

making the mistake and consisting in: 

(1) an unconscious ignorance or forgetfulness of a 

fact, past or present, material to the contract, or 

(2) belief in the present existence of a thing 

material to the contract which does not exist or in 

the past experience of such a thing which has not 

existed. 

Section 28-2-409, MCA. 

Mr. Whitcher contends that there are three separate 

bases for a finding of mutual mistake which justify a settinq 

aside of the settlement agreement and that therefore, it was 

error for the Workers' Compensation Court to deny a reopening 

of the case. These accounts of mutual mistake relate to (I.) 

the parties' understanding of the settlement agreement; (2) 

the condition of the claimant's back at. the time of the 
settlement; and (3) the claimant's psvchol.ogica1 condition at. 

the time of the settlement. 

The Settlement Agreement 

First, Mr. Whitcher argues that because he was unable to 

understand the agreement, there was no meeti.ng of the minds 

as to what was being settled and that this constitutes mutual 

mistake. He contends that he thought the lump sum amount OF 

$8,000.00 was anal-ogous to his previous lump sum distribntions in t.hat he would continue to receive benefits. Whi1.e 

it is not clear how the insurer was in "unconscious ignorance" as to the meaning of the contract terms, we assume 

that Mr. Whitcher is charging the insurer with knowledqe of 

his own ignorance regarding the meaning and effect of t.he 

full and final settlement. 

A clinical psychologist testified by deposition regarding the claimant's ability to read. and understand the settlement agreement. The psychologist had. performed various tests 

on the claimant in 1980 at the request of Vocational Rehabilitative Services to determine Mr. Whitcher's vocational 

skills and interests. Those tests revealed. that in 1980, Mr. 

Whitcher had an IQ which was just below average intelligence 

and that his reading ability was at the 8th grade level. 

When asked whether the claimant would be able to comprehend 

the Petition for Fu13. and Final Settl-ement, the psychologist 

responded: 

A: I think that he would be able to comprehend jt 

with perhaps some concepts explained to him. 

Rut basically most of the wording is at a 

level which he could comprehend. 

Q: What would you feel would need to be explained 

to him? 

A: Oh, such words I think as duration, he might 

not he able to understand the meaning of that 

term without some---iust be able to pronounce 

it and understand jt. Tberp's just a matter 
of some single words and so forth. Concurrence. These are some more difficult words to 

read. And they're not in a typical type of 

vocabulary of people at Mr. Whitcher's level. 

However, I think that if there was some 

discussion along with this, he can understand 

the figures and terms of the amount of money 

involved. The fact that this is a lump sum 

payment, and that he's due some additional 

benefits, I think that would be fairly understandable to him. 

Levi Loss, the assistant bureau chief with the Workers' 

Compensation Division at the time of the settlement, stated 

that he would not approve a settlement if he thought a claimant did not understand it. Although Mr. Loss initially 

rejected the $8,000.00 settlement offer, he later approved it 

upon the addition of 26 weeks of benefits. When testifying 

about Mr. Whitcher's understanding of the finality of the 

settlement agreement, Mr. Loss stated: 

I believe at the time that he understood it. 

I think that he must have been in a position to 

where that was --- 

Somehow or another, it didn't seem to be that 

important to him. He just wanted his money, and it 

was more important to get it, although he was aware 

that it could have some gravity; and if they ask 

for it and insist on it, it gets to the point where 

if the adjuster and them, if that's what they work 

out, I can' t tell too many people just how far to 

go, if they insist. 

The adjustor who handled the claim testified that he had 

no reason to doubt Mr. Whitcher's ability to understand that 

$8,000.00 was the maximum he was going to get. The evidence 

indicates that the adjustor had explained both verbally and 

in writing that after receiving the $8,000.00, the cl-aimant 

would he closin~ his right to compensation forever. 
The Workers1 Compensation Court found that Mr. Whitcher 

was capable of understanding the terms of the settlement 

agreement. We holcl that the above testimony substantially 

supports that finding so that the claim of mutual mistake as 

to what was being settled is without merit. 

In connection with that argument, Mr. Whitcher contends 

that the modification of the settlement agreement to include 

26 weeks of additional payments without his knowledge or 

consent constitutes mutual mistake since there was no meeting 

of the minds as to those provisions. No relevant findings 

were made by the Florkers' Compensation Court, and we are 

reluctant to serve as factfinders as to this issue. However, 

we fail to see why Mr. Whitcher would not have agreed to the 

additional terms of the settlement. since they were in his 

economic interest. 

Next, Mr. Whitcher contends that the parties were mutually mistaken in their understanding of the nature and extent 

of his back condition and how the injury mav have aggravated 

the claimant's pre-existing psychological impairments. The 

Workers' Compensation Court made no specific findings relating to the issue of mutual mistake and the claimant's mental 

or physical condition, and as a reviewing court, we will not 

make our own findings of fact in this regard. However, given 

our concern for this claimant whose impairment is serious and 

who was not represented by legal counsel at the time he 

entered into the settlement agreement, we will briefly examine the record to determine if there is any evidence which 

might justify further inquiry into these contentions. 

The Rack Injury 

This Court has been reluctant to reopen a Petition for 

Full and Final Settlement based on mutual mistake surrounding 

the injury except in a small number of situations. In Kimes 

v. Charlie's Family Dining & Donut Shop (Mont. 19881, 759 
P.2d 986, 45 St.Rep. 1402, this Court allowed an injured 

worker to reopen his petition where a new and different 

medical problem was discovered after the settlement. In 

Weldele v. Medley Development (Mont. 1987), 738 P.2d 1281, 44 

St.Rep. 1062, we allowed a reopening of the petition where 

the claimant's initial condition deteriorated substantially 

and the treating physician's initial assessment was a misdiagnosis of the actual extent of the injury. 

There is no evidence in the record indicating that Mr. 

Whitcher's back condition was originally misdiagnosed and 

that it subsequently worsened beyond the scope of the initial 

diagnosis. Nor is there evidence indicating that any new or 

different medical problem was diagnosed after the settlement. 

While we are sympathetic to the claimant's purported increased levels of pain, we find nothing in the record to 

indicate that the present state of his injury is anv different than at the time of settlement. The orthopedic surgeon 

who gave the claimant a 20% whole body impairment rating in 

1980 testified again in 1987 that, in his opinion, the impairment rating had not changed during that time. Also, in 

April of 1982 a myelogram was administered which revealed "an 

area where there was pressure which did not look significantly different from the time of the myelogram at the time of 

his first surgery (in 1980) ." 

The claimant's testimony indicates that he has suffered 

extreme and often debilitating pain ever since the injur;r, 

which appears to have gotten worse over the years. We note 

that during this time, Mr. Whitcher has been employed in jobs 

requiring heavy lifting, bending, and long periods of standing, which was discouraged by his phvsician. Toget-her with 

the lack of medical testimony justifying a reopening of the 

case, we conclude that while Mr. Whitcher mav indeed he 

experiencing an increased level of pain, there is nothing to 
indicate the parties were mutually mistaken about the condition of his hack at the time of the settlement. 

The Psychological Condition 

Mr. Whitcher also contends that the parties were mutual-- 

ly mistaken about certain diagnosed personality disorders, 

which he claims did not become "active" until after the 

injury and the settlement. This Court has found mutual 

mistake where a claimant's lower back injury was later determined to have aggravated a pre-existing condition of cerebral 

palsy which the parties did not. take into account at the time 

of the impairment ratj-ng and settlement agreement. Kienas v. 

Peterson, 624 P.2d at 3. However, there is no evidence here 

which would support a similar conclusion. While it is clear 

that Mr. Whitcher suffered a number of psychological impairments, there is no evidence to connect those impairments to 

the back injury. The psychologist's report indicates that 

Mr. Whitcher suffered a chronic personality di sorder, which 

he descrihed as: 

". . . (a) generally inadequate adjustment over a 

number of years, probably first appearing as a 

teenager, or maybe even a little earlier than that, 

inadequately adjusting to school, dropping out, not 

finding any consistent satisfactory type of work, 

having some family, marital problems." 

The evidence indicates that this described "condition" persisted following the claimant's injury. However, there is no 

evidence that it was the claimant's personality disorder 

which was the source of his frustration so much as it was 

just an unfortunate series of events which occurred following 

the injury. 

Mr. Whitcher was examined again in 1982 by a different 

clinical psychologist who also identified several personality 

disorders, one of which he characterized as a "schizoid" 
tendency. When asked about the relationship between the 

claimant's schizoid behavior and his back condition, the 

psychologist testified: 

" . . . I think that in this instance, that he is 

apt to show rather inconsistent behavior with 

regard to his back problem. It is going to bother 

him maybe sometimes a bit more; sometimes he is 

going to ignore it. He is going to take a very 

obtuse attitude, he might, I don't know; like 

nothing is wrong with me. I am going to go ahead 

and work. I am not going to lie, I am not going to 

tell anybody; it will be some irratic behavior 

about the way he treats his back. I don't think 

the back injury is going to make the schizoid 

personality disorder worse, it is not going to make 

it worse, it is just going from this way to this 

way. " 

Our examination of the record leads us to conclude that 

even if the parties did not take into account the existence 

of the claimant's personality disorder at the time of the 

settlement, there is no basis upon which to find a mutual 

mj-stake of fact. The evidence does not indicate that the 

personality disorder was aggravated by the injury or that 

there was anv connection between the injury and the disorder. 

Even if we had found some basis upon which to consider 

this case on the merits, the Workers' Compensation Court 

concluded that Mr. Whitcher's claim is barred hy the statute 

of limitations so that his request to reopen the petition 

should be denied. In declining to reopen Mr. Whitcher's 

settlement agreement based on the grounds of mutual mistake, 

the Workers' Compensation Court applied the following statute 

of Limitations: 

The period prescribed for the commencement of 

an action for relief on the ground of fraud or 

mistake is within 2 years, the cause of action in 

such case not to be deemed to have accrued until 
the discovery by the aggrieved party of the facts 

constituting the fraud or mistake. 

Section 27-2-203, MCA. 

Since the settlement was completed and approved by the 

proper authorities in April of 1980, the court concluded that 

under the statute, Mr. Whitcher had until April of 1982 to 

file his claim. Since it did not appear that he was seekins 

medical care during that time until he returned to see his 

doctor in April, 1982, the court noted that the statute ma17 

not have begun to run until that time. Rased on medical 

facts and Mr. Whitcher's debilitating condition in 1982, the 

court concluded that the limitation period would have expired 

by at least the fall of 1984. Thus, the claim filed in 1987 

was barred by the two year statute of limitations in either 

case. 

Finally, the court noted that the only possibility of 

not being precluded by the statute of limitations from bringing this claim would be if Mr. Whitcher's mental capacity was 

such as to make him unable to knowingly be charged with the 

statute. Since this possibility was neither raised or pursued by the claimant, the court did not consider it as an 

issue and stated, "Unfortunately, the harsh reality of his 

claim under the circumstances gives the Court no alternative 

but to deny his request." 

We conclude that the determination by the Workers' 

Compensation Court that Mr. Whitcher's claim is barred by the 

statute of limitations is a correct application of the law in 

light of the facts of this case. There is no evidence that 

the statute should be tolled either by latent discovery or by 

the claimant's mental condition. We affirm the court's 

denial of the claimant's request to open the Petition for 

Full and Final Compromise Settlement. 
We note the Workers' Compensation Court's concern for 

Mr. Whitcher's mental, physical, and emotional condition, and 

the benefits to which the court deemed him entitled. These 

benefits include medical coverage, a 20% penalty against the 

insurer, rehabilitation, and costs and attorney fees for the 

medical benefits issue upon which he prevailed. 

Affirmed. 

We Concur: / 

Mr. Justice William E. Hunt, Sr., and Mr. Justice R. C. McDonough 

did not participate in this cause. 
Mr. Justice John C. Sheeh~r, dissenting: 

This worker's right to compensation payments should he 

reinstated on the law and on the facts. 

When Mr. Wood, representing Pacific Employer Insurance, 

offered an $8,000 settlement, on March 20, 1980, Whitcher had 

a whole body permanent physical impairment of 20 percent 

recognized by his doctor. The petition which Wood prepared 

and had Whitcher sign for $8,000 represented the payments 

that Whitcher would receive at $94 a week for 1.64 vears. 

The people then handling claims for the Workers' Compensat.ion 

Division recognized the proposal as unconscionable. Without 

contacting Whitcher, the Workers' Compensation Division 

negotiated with Wood for an additional 26 weeks of 

compensation. Whitcher never was consulted by either Wood or 

the Division as to whether OJhitcher would consent to the 

increase. The necessity for the increase would have 

impressed upon Whitcher, perhaps, that his dealings with Wood 

were not on all fours with propriety. Thus, we have a full 

and final settlement to which Whitcher never consented. As 

the opinion notes, the Workers' Compensation Court made no 

relevant findings as to this point. Nonetheless, the 

majority airily dismisses the lack of Whitcher's consent 

saying, "We fail to see why Mr. VJhitcher would not have 

agreed to the additional terms of the settlement since they 

were in his economic interest." Thus does the majority 

supply the missing element of consent to the agreement in 

this case. The majority does not attempt to explain how an 

agreement so detrimental to the interests of Whitcher are in 

his "economic interest." 

In Kienas v. Peterson (1980), 624 P.2d 1, 37 St.Rep. 

1747 (Harrison, J.) this Court set aside a full and final 
compromise agreement before the Workers' Compensation Court 

on the ground of mutual mistake. Section 28-2-1611, MCA, 

permits a contract to be revised by the court when through 

fraud or mutual mistake a written contract does not truly 

express the intention of the parties. It was on that hasi-s 

that Kienas was decided. However, S 28-16-1611, MCA, also 

permits the revision of a contract when there is a mistake of 

one party which the other party at the time knew or 

suspected. The evidence here shows that Whitcher's consent 

to the $8,000 settlement was a mistake. If Pacific did not 

know it was a mistake at the time, it soon found out when the 

proposal was submitted to the Workers' Compensation Division. 

The subsequent amendment of the proposal for settlement 

executed between Wood and the Division without the knowledge 

or consent of Whitcher constituted no contract as far as 

Whitcher is concerned and there should be no problem about 

reopening his case before the Workers' Compensation Court 

under S 28-16-1611, MCA. 

Section 27-2-203, MCA, provides that the two year 

statute of limitations for reopening a contract on the ground 

of fraud or mistake is not to be deemed to have accrued until 

the discovery by the aggrieved party of the facts 

constituting the fraud or mistake. The question of fact to 

he determined in this case should be when did Whitcher 

determine or discover that he had made a mistake in signing 

the faulty agreement. There is no doubt that Pacific knew or 

suspected that he had made a mistake. 

Whitcher has been completely disabled since his injury 

and is completely disabled now. The use of legal dodges to 

deny him his monetary relief where his medical need is 

verified, shows the absurdity of courts in this Workers' 

Compensation system. The consent of Whitcher to the final 

settlement here cannot be implied under our statutes because 
he was never offered a proposal which became the final 

settlement. Section 28-2-503, MCA. The purported contract 

could be altered here only by another contract here in 

writing which does not exist, or by an executed oral 

agreement which also does not exist. Section 28-2-1602, MCA. 

There being no contract, Whitcher has no problem with respect 

to his right to additional compensation, no contract, no bar 

throuqh the statute of limitations. 

\