### No. 82-141 IN THE SUPREME COURT OF THE STATE OF 

### XONTANA 1982

VICKI R. CHRISTENSON, Claimant and Appellant,

VS. 

### BILLINGS LIVESTOCK COM1\IISSION COMPANY,Employer, and STATE COMPENSATION INSURANCE FUND, Defendant and Respondent.

Appeal from: Workers' Compensation Court of the State of Montana, In and for the Area of Billings Honorable TimothyW. Reardon,Judgepresiding. Counsel of Record: For Claimant: Herndon, Harper & 

### Munro, Billings,Montana For Defendant: Allen B. Chronister, Helena,Montana

Submitted on briefs: July 15, 1982 Decided: November 9, 1982

Filed: 

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### ClerkMr. Justice Daniel J. Shea delivered the Opinion of the Court. Claimant,Vicki R. Christenson appeals from a judgment inWorkers' Compensation Courtwhich held that a settlement agreement negotiated with a claims examiner did not create a Sinding contractbetween claimant and the liability carrier, State Insurance Fund (StateFund). Claimant contends that the claims examinerwas authorized to negotiate a binding settlement agreement and that a binding agreementwas in fact created. We affirm the Workers' Compensation Court. Claimantwas injured atwork in 1973. Claimant's employer, Billings Livestock Commission Companywas enrolled under Workers' Compensation Plan 111. State Fund accepted liability and paid all of claimant's medical bills and compensationof $32.67 per week. From late in 1979 until spring of 1981, State Fund negotiated with claimant to arrive at some final settlement of claimant's disabilitybenefits. Claimantwas represented by counsel and negotiations were conducted through a claims examiner with State Fund. The State Fund bureau chief supervised thework of the claims examiner. InMarch of 1981, the parties reached a tentative settlement. Claimant and her attorney signed a petition for full and final compromise settlement. Under the terms of the proposed settlement, claimant would receive a lump

sumpayment of $13,000 and payments of $860per month for

one year,during which time claimantwas to undergo a rehabilitation program. In addition, State Fund would pay claimant'smedical expenses during her lifetime. When the signedpetitionwas presented to the State Fund bureau chief he rejected it as excessive and beyond the -2-liability of State Fund as an insurer. The bureau chief offered instead a single lump sum final settlementof $6,000. At this point, claimantbrought thematter before the Workers' Compensation Court, insisting that through the negotiations between her attorney and the State Fund claims examiner, she had entered into a binding final settlement agreementwith State Fund. After a trial on September 22, 1981,Workers' Compensation Court entered a judgment that the preponderance of evidence established that the proposed settlement agreementdid not create a binding contract between claimant and State Fund because State Fund had not consented to its terms. No penalties were awarded. Claimant argues that consent of the bureau chiefwas not necessary, that the State Fund claims examiner had either actual or apparent authority to negotiate a final settlement and that the State Fund was bound by the settlement that the claims examiner had negotiated. We agree with the Workers' Compensation Court holding that the claims examiner did not have either actual or apparent authority to enter into a binding final settlementon behalf of the State Fund. Actual authority is defined at section 28-10-402,MCA:

"Actualauthority is such as the principal intentionally confers upon the agent or intentionally or by want of ordinary care allows the agent to believe himself to possess." The Workers' CompensationCourt found that the bureau chiefwas the only person authorized to bind State Fund to a settlement contract, that the claims examinerswere continually reminded of their limited authority, and that this claims examinerwas aware that her authoritywas limited to negotiating proposed settlements. Negotiated proposedsettlementswere regularly submitted to the bureau chief for approval. The heading of the documentwhich claimant asserts is a binding contract is "Petition for Full and Final Compromise Settlement." (Exhibit2.) The heading alone suggests that it was not the final agreement between the parties. The record supports the Workers' Compensation Court's finding that the claims examiner did not have actual authority. Nor did the claims examiner have ostensible authority to bind the State Fund. Ostensible authority is defined at section 28-10-403,MCA: "Ostensibleauthority is such as a principal, intentionallyor by want of ordinary care, causes 

### or allows a third person to believe the agent to possess." Unrefuted testimony at trial established that the claims examiner never told claimant's attorney that she had authority to bind State Fund and that she always told claimant's attorney that shewould have to submit any proposed settlement to the bureau chief for approval. From this evidence, Workers' Compensation Court correctly concluded that the claims examiner did not have ostensible authority. There can be no binding contractwithoutmutual consent of the parties. Section 28-2-102(2), MCA. The proposed settlementwas never approved by the bureau chief of State Fund. &sent the bureau chief's approval, claimant had no right to rely on the petition for full and final compromise settlement as a binding agreement. TheWorkers1Compensation Court judgment was based on substantial evidence and we thereforewill not overturn the decision. The judgment is affirmed.We Concur: