No. 94-296

IN THE SUPREME COURT OF THE STATE OF MONTANA

1995

STEPHEN P. WEBER,

Petitioner and Respondent,

PUBLIC EMPLOYEES' RETIREMENT BOARD,

Respondent and Appellant.

APPEAL FROM: District Court of the First Judicial District,

In and for the County of Lewis and Clark,

The Honorable Thomas C. Honzel, Judge presiding

COUNSEL OF RECORD:

For Appellant:

Kelly A. Jenkins, Special Assistant Attorney

General, Helena, Montana

For Respondent:

Eric B. Thueson, John A. Kutzman, Attorneys

at Law, Helena, Montana

Filed:

Submitted on Briefs: January 12, 1995

Decided: March 9, 1995

Cl&k
Justice W. William Leaphart delivered the Opinion of the Court.

The Board of Administration of the Public Employees Retirement

Division (PERB) appeals from the decision of the District Court of

the First Judicial District, Lewis and Clark County, which reversed

the decision of PERB denying Stephen Weber (Weber) disability

retirement benefits under Title 19, Chapter 3, Part 10, MCA.

Issues

1. Did the District Court improperly assume jurisdiction over

Weber's petition for judicial review which was filed more than

thirty days after Weber was personally notified of the

Administrative decision but within thirty days of the written

memorandum of decision?

2 . Did the District Court commit reversible error in

concluding that PERB misapprehended the effect of the medical

deposition testimony of Dr. Etter?

Backsround

From 1981 through September 9 of 1988 when he resigned his

position, Weber was the assistant administrator of the Tort Claims

Division (now known as the Insurance and Legal Division) for the

Montana Department of Administration. Weber suffers from Multiple

Sclerosis (MS), a disorder which affects the brain and nervous

system and is characterized by the appearance of "plaques" (scar

tissue) on the nerves which can disrupt the transmission of nerve

impulses. The symptomology of the disease includes numbness; lost

Or reduced mobility; loss of strength and coordination;

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deterioration of vision; and deterioration of speech. Another

aspect of this disease is that it is often characterized by

alternating periods of increased and decreased symptoms

("exacerbations" and "remissionI'), such that an MS victim may

appear normal during a period of remission, which may last for

days, weeks, or even months. Additionally, MS is known to be

aggravated by physical and emotional stress.

Weber has had MS at least since the early 1970s. Although he

was tentatively diagnosed with MS in 1976, he was not conclusively

diagnosed until June of 1991, when he underwent an MRI (Magnetic

Resonance Image) of his head. He had experienced symptoms

consistent with MS over the twenty-year period beginning around

1970, but given the non-debilitating nature of his symptoms for

most o f that time, along with the invasive nature of past

techniques for confirming MS (spinal tap), his physicians had

elected not to aggressively pursue a diagnosis. Consequently,

Weber did not know he had MS when he left his job with the State in

September of 1988, at which time he was suffering from what are now

known to have been stress related complications of the disease,

including double vision, loss of concentration and energy, ringing

in his ears, and slurred speech. At the time of leaving his job in

1988, Weber attributed those symptoms to work-related stress.

In August of 1988, Weber learned that his position was being

reclassified from pay grade level 16 to level 14. He believed that

this pay reduction, as well as other problems he was having with

his superiors at the time, was in retaliation for his refusal to

authorize payment of what he felt was an inflated claim submitted

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to his department by another State agency, an opinion with which

the Montana State Auditor concurred.

In August of 1989, Weber sued the State of Montana, alleging

that his superiors' treatment of him prior to his resignation

created an intolerable work environment and amounted to a

constructive discharge. On September 27, 1990, a jury agreed and

awarded Weber more than $30,000 in damages. This verdict was

upheld by the Montana Supreme Court on May 5, 1992, in Weber v.

State of Montana (1992), 253 Mont. 148, 831 P.2d 1359.

After learning that the physical problems he was experiencing

at the time he left his job were in fact stress induced

exacerbations of MS, Weber filed for disability retirement benefits

from the Public Employees' Retirement System (PERS) on August 6,

1991. In order to qualify for PERS disability benefits, the

claimant must prove that he has become unable to perform the duties

of his job by reason of physical or mental incapacity while in

active service. Section 19-3-1002, MCA. Furthermore, the

disability must be permanent, or of extended or uncertain duration

as determined by PERB on the basis of competent medical opinion.

Section 19-2-303(15), MCA.

In his application for disability benefits, Weber alleged that

he became unable to effectively perform his job at the Tort Claims

Division by August of 1988. At the hearing, Weber and his wife

testified regarding his physical condition in 1988. Weber also

presented the deposition testimony of his physician, Helena

internist Dr. Harry Etter, who testified that in his opinion, and

to a reasonable degree of medical certainty, Weber was disabled

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from performing his job by the.time he resigned his position in

1988.

On December 19, 1991, PERB denied Weber's application for

benefits. Weber requested administrative review of this denial

pursuant to the Montana Administrative Procedure Act, §§ 2-4-101

through 2-4-711, MCA. A contested case hearing was held on August

28, 1992, and on February 4, 1993, the hearing examiner recommended

that Weber's application for benefits be denied. On April 29,

1993, the parties presented oral argument to PERB concerning their

objections to the hearing examiner's proposed findings and

conclusions. On May 17, 1993, PERB adopted all of the hearing

examiner's proposed findings of fact, all but one of the

conclusions of law, and adopted the examiner's recommendation that

Weber's application for benefits be denied.

In support of its denial of benefits, PERB relied on previous

statements made by Weber which tended to show that he resigned his

position with the State in order to preserve the higher pay-out of

his unused benefits, and not because he believed himself to be

disabled; that he believed himself capable of continuing in his

job; that he offered to remain in his job if his pay would not be

cut; that he failed to seek medical attention for what he claimed

was a particularly difficult exacerbation; and that in the course

of his wrongful discharge trial, he characterized his health

subsequent to his military service as excellent.

Although PERB did not employ a medical expert, it nonetheless

concluded that Weber was not disabled at the time of his

resignation. PERB relied on Dr. Etter's response to a hypothetical

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question posed by PERB's counsel &cross-examination to support

its denial of Weber's application for disability benefits.

Issue 1

Did the District Court improperly assume jurisdiction over

Weber's petition for judicial review which was filed more than

thirty days after Weber Was personally notified of the

Administrative decision but within thirty days of the written

memorandum of decision?

PERB contends that its final decision was stated in the record

at the April 29, 1993 hearing, at which time Weber and his

attorneys were present and were personally notified of its

decision. On May 5, Weber requested a written memorandum of

decision, as allowed by § Z-4-623(5), MCA. Accordingly, on May 17,

1993, a written memorandum of decision was mailed to Weber and his

attorneys. Weber's petition for judicial review was filed June 8,

1993. PERB contends that the thirty-day period for filing a notice

of appeal began to run from April 29, 1993, the date PERB orally

announced its decision as opposed the May 17, 1993, the date it

forwarded a written memorandum of decision to Weber. The minutes

of the April 29, 1993, hearing indicate that the PERB attorney,

"explained that the next step, after the Board reaches its final

determination, when it rules on the exceptions before it and

renders a final decision in writing, is that under the law either

party has a right to petition [the] District Court for judicial

review."

Under the Montana Administrative Procedure Act, a party

seeking judicial review of an agency decision must petition for

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such review "within 30 days after service of the final decision of

the agency . . . .'I Section 2-4-702(2) (a), MCA. We find, in the

case at hand, the decision of the agency did not become "final" and

was not served until May 17, 1993, when PERB issued a written

document entitled "Findings of Fact, Conclusions of Law and Final

Decision." Weber's petition for judicial review was filed within

thirty days of May 17, 1993 and therefore was timely.

Issue 2

Did the District Court commit reversible error in concluding

that PERB misapprehended the effect of the medical deposition

testimony of Dr. Etter?

In its written memorandum, the District Court acknowledged

that, normally, its review of an administrative decision is

restricted to a determination as to whether or not the

administrative findings of fact are clearly erroneous, and whether

the agency's interpretation of the law is correct. Steer, Inc. v.

Dep't of Revenue (1990), 245 Mont. 470, 474, 803 P.7.d 601, 603.

The District Court then relied on this Court's decision in Shupert

v. Anaconda Aluminum Co. (1985), 215 Mont. 182, 187-88, 696 P.2d

436, 439, for the proposition that the reviewing court is in as

good a position as the lower tribunal to evaluate deposition

testimony. Roadarmel v. Acme Concrete Co. (1989), 237 Mont. 163,

168, 772 P.2d 1259, 1262.

In Shupert, this Court reviewed a decision by the Workers'

Compensation Court and stated as follows:

Ordinarily, this Court will not substitute its judgment

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for that of the Workers' Compensation Court in

determining the weight and credibility to be given

testimony. The reason for this is that this Court defers

to the lower court's assessment of the demeanor and

credibility of witnesses. Rule 52 (a) , M.R.Civ.P.

However, when the critical evidence, particularly medical

evidence, is entered by deposition, we have held that

"this Court, although sitting in review, is in as good a

position as the Workers' Compensation Court to judge the

weight to be given such record testimony, as

distinguished from oral testimony, where the trial court

actually observed the character and demeanor of the

witness on the stand. Hert v. J.J. Newberry Co. (1978),

178 Mont. 355, 359-60, 584 P.2d 656, 659.

Shuuert, 696 P.2d at 439.

The District Court was correct in concluding that there is no

operative distinction between our reasoning in Shuoert and the

facts in the present case where the testimony of Dr. Etter was by

way of deposition. That being the case, the District Court was in

as good a position as the hearing examiner to judge the weight of

Dr. Etter's deposition medical testimony.

In applying the Shupert rationale that a reviewing court is in

as good a position as the trier of fact to review deposition

testimony, it must be noted that the standard of review on the

overall case remains the same. In McIntyre v. Glen Lake Irrigation

District (1991), 249 Mont. 63, 813 P.2d 451, we reviewed a decision

of the Workers' Compensation Court which was based upon deposition

medical testimony as well as live testimony from the claimant and

his spouse. In McIntvre we held that, although we could make an

independent review of the deposition testimony, in the final

analysis, we were still restricted to determining whether there was

substantial credible evidence to support the decision of the

Workers' Compensation Court. McIntyre, 813 P.2d at 454.

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The present case differs procedurally from McIntvre where the

Workers' Compensation Court had heard live testimony from the

claimant and had reviewed deposition medical testimony. Here, the

District Court did not hear any live testimony. Rather, it was

reviewing the proceedings of PERB which adopted a proposed decision

from a hearing examiner who heard testimony and reviewed both

medical and non-medical depositions. In other words, in the

present case, the live testimony is two steps further removed from

this Court than in McIntvre. Thus, unlike McIntvre, we are not

reviewing the district court to determine whether there is

substantial credible evidence to support its decision. Rather, we

are reviewing the District Court to determine whether it, in turn,

properly applied the correct standard of review to the

administrative decision of PERB. That is, did the District Court

determine whether the administrative findings of fact were clearly

erroneous and whether the agency's interpretation of the law was

correct. We conclude that the District Court, although engaging in

an independent review of the medical deposition, specifically

applied the three-part clearly erroneous standard. State Comp.

Mutual Insurance Fund v. Lee Rost Logging (19921, 252 Mont. 97,

102, 827 P.2d 85, 88. Further, we determine that the District

Court correctly applied that standard.

In support of Weber's claim for disability benefits, Dr. Etter

testified (by way of deposition) that Weber had been suffering from

MS for at least the last twenty years, but that the disease had not

become disabling until 1988 when Weber underwent a period of job

stress. He indicated that the MS symptoms had been progressively

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worsening since the stressful work events in 1988. Accordingly,

Dr. Etter concluded that, since 1988, the MS had continuously

disabled Weber from the kinds of accounting and administrative

functions he performed for the State.

Weber, however, did not realize that he was suffering from MS

until he was definitively diagnosed with MS in 1991 when he

underwent an MRI. It was then that he realized that MS, coupled

with the stress of his job with the State, caused the deterioration

of his job performance in 1988. He therefore filed for PERS

disability retirement benefits on August 6, 1991.

PERB did not present any medical testimony of its own. PERB

does not deny that Weber has MS now or that he has had the disease

for a number of years including the time period surrounding the

stressful events in the late summer and early fall of 1988.

Further, the agency does not dispute that MS is a progressive and

debilitating disease with symptoms that come and go. The agency

agrees that Weber is presently disabled from the last job he held

with the State of Montana.

Since PERB did not present any medical testimony of its own,

Dr. Etter's testimony and medical conclusions were uncontradicted.

The medical opinions of a claimant's treating' physician are

entitled to special weight and should not be disregarded absent

specific legitimate reasons for doing so. Embrey v. Bowen (9th

Cir. 19881, 849 F.2d 418, 421.

In contending that Weber was not disabled at the time of his

resignation, PERB relied on previous statements made by Weber in

1988 at which time Weber indicated that he was resigning his

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position in order to preserve the higher pay-out of his unused

benefits--not because he believed himself to be disabled. As the

District Court acknowledged, these statements, made by Weber in

1988, do nothing more than show that Weber did not believe himself

to be disabled at that point in time. The statements do not

conclusively prove that he was not, in fact, disabled at that time.

PERB places considerable weight on Dr. Etter's response to a

hypothetical question posed by PERB's counsel. Counsel for PERB

asked Dr. Etter to assume the following: that he had been shown

statements by Weber indicating that Weber felt he was capable of

performing the job functions that he had at the State; that Weber

felt so at the time he terminated his employment at the State; that

he felt so for some extended period of time after that; and that in

fact Weber anticipated that he could do that job and do the job of

a CPA in private practice. Counsel for PERB then posed the

following question, "on the basis of that information, would you

believe that he was completely disabled from performing his job

functions with the State?" Dr. Etter responded, "if he told me

that, then I would not think he was disabled, no, for performing

those tasks."

The question posed by counsel for PERB did not acknowledge

that multiple sclerosis is an incurable, progressive disease

subject to periods of remission and exacerbation. Furthermore, the

hypothetical question did not consider the possibility that the

statements attributed to Weber in 1988 might have been made during

a period of remission and thus Weber may have believed himself to

be in perfectly good health when, in fact, he was not. See Estes

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v. Railroad Retirement Board (9th Cir. 1985), 776 F.2d 1436, 1438,

in which the Court noted that "multiple sclerosis can be disabling

notwithstanding normal activity in periods of remission."

PERB also claims that Weber was ineligible to claim disability

benefits because he was not continuously disabled from the time he

left his job in 1988 until the time he applied for benefits in

1991. In concluding that Weber was not eligible for benefits, PERB

chose to treat the testimony of Weber and his wife as insufficient.

In its Finding of Fact No. 17, PERB stated:

Despite an exhaustive search of the record for

corroborating evidence, except for Stephen Weber's and

Beverly Weber's testimonv at hearinq, no evidence was

submitted that Mr. Weber's MS symptoms did not completely

abate following the August 1988 attack. [Emphasis

added.]

In its Finding of Fact No. 20, PERB stated:

Mr. Weber contends that the August 1988 "attack" was the

beginning of a change in character of the effect of MS on

his life and his abilities in that for the first time not

all of the symptoms of MS completely abated after this

attack. The particular symptom alleged not to resolve

was double vision. This contention is rejected as not

supported by a preponderance of credible evidence. The

onlv evidence to suooort this contention is the hearinq

testimonv of Stephen and Beverlv Weber [emphasis added].

Although choosing to discount the testimony of the Webers,

PERB did not attempt to refute the testimony of Stephen and Beverly

Weber by offering medical testimony of its own to show that from

1988 to 1991 Weber was capable of performing the duties of his

executive position with the State even though he was relatively

symptom free during that period. All that PERB offered in support

of these findings were statements made by Weber in 1988 before he

knew his problems were related to MS. It should be noted that PERB

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concedes that by May of 1991 Weber was disabled and, had he still

been working for the State at that time, it is quite probable that

disability benefits would have been appropriate. We hold that the

District Court did not err when it ruled that PERB's findings were

clearly erroneous in that PERB misapprehended the effect of Dr.

Etter's testimony. Further, the District Court did not err in its

definite and firm conviction that PERB, in denying Weber disability

benefits, committed a mistake. Lee Rost Loosing, 827 P.2d at 88.

We affirm the District Court's conclusion that, based on the

available medical evidence, Weber has been continuously disabled

from performing the duties of the Assistant Administrator of the

Tort Claims Division since his departure from that position on

September 9, 1988.

By way of clarification, it should be noted that the present

case differs from Moran v. Shotgun Willies, Inc. (Mont. 19951, (No.

94-361, decided February 15, 19951, another administrative appeal

decision handed down earlier this month. In Moran, we affirmed the

district court determination that there was competent substantial

evidence to support the hearing officer's findings and conclusions

and therefore the agency (Human Rights Commission) abused its

discretion and exceeded its authority under § 2-4-621(3), MCA, when

it rejected the hearing officer's findings. Moran, slip op. at 8.

Unlike the Human Rights Commission in Moran, PERB, in the present

case, did not disagree with its own hearing officer. Rather, PERB

adopted the hearing officer's findings of fact so the competent

substantial evidence test of § 2-4-621(3), MCA, was not an issue.

Also, Weber raised, and the District Court applied, the "clearly

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erroneous" standard rather than the "'abuse of discretion" standard

utilized in Moran--both of which are permissible standards under §

2-4-704(2) (a), MCA. In applying the three pronged "clearly

erroneous" standard, Lee Rest Loqqinq, 827 P.2d at 88, the District

Court did not find that there was a lack of substantial credible

evidence to support PERB's decision. Rather it relied upon the

second and third prongs of the test and found that PERB

misapprehended the effect of the testimony and, further, that it

had a firm conviction that PERB had committed a mistake.

Affirmed.

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Justice Karla M. Gray, concurring in part and dissenting in part.

I concur in the Court's opinion on issue 1 and, with great

reluctance, respectfully dissent from that opinion on issue 2. My

reluctance is personal, based on my own familiarity with MS and the

heartbreak of watching a close relative progress through the early

stages of that incurable and progressive disease to a state of

total physical incapacitation. My dissent, however, is based on

my perception that the Court's legal analysis of issue 2 is

erroneous.

It is important to keep in mind at the outset that the burden

of establishing entitlement to disability benefits is on the

claimant. Under § 19-3-1002, MCA (19911, an employee who has

become disabled while in active service is eligible for disability

retirement benefits. "Disabled" means "unable to perform his

duties by reason of physical or mental incapacity." Section 19-3-

1001, MCA (1991).

I raise the matter of who carries the burden because the Court

suggests, at least by implication, that the PERB itself had some

affirmative burden to meet. The Court does so by making the

following statements:

1 . "Although PERB did not employ a medical expert . . .'

2 . "PERB did not present any medical testimony of its own."

3 . "Since PERB did not present any medical testimony of its

own . . .I'

4 . "PERB did not attempt to refute the testimony of Stephen

and Beverly Weber by offering medical testimony of its

own . . .I'

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These repeated statements suggest that the PERB had a burden to

come forward with evidence, rather than merely to determine whether

Mr. Weber had carried his burden of proving by a preponderance of

the evidence that he was disabled--that is, unable to perform the

duties of his position--by MS in September 1988 when he resigned.

The Court's apparent shifting of the burden is erroneous; it also

reflects a lack of focus and clarity in other areas of the Court's

opinion on this issue.

In fact, the record in this case clearly supports the PERB's

finding that Mr. Weber did not meet his burden of proving that he

was disabled by MS from performing his job at the time of his

resignation in September 1988. Indeed, the only unequivocal

testimony supporting Mr. Weber's claim came from Mr. Weber and his

spouse; the PERB did not find Mr. Weber or his spouse credible

based on Mr. Weber's statements at the time of his resignation,

during his wrongful discharge suit and to a variety of health care

providers between 1986 and 1991 that evidenced no serious MS-type

symptoms. This is the province of the trier of fact, not the

District Court or this Court. I cannot agree to the reviewing

courts substituting their judgment for that of the factfinder.

Nor do I agree with the Court that the PERB misapprehended the

effect of Dr. Etter's deposition testimony. It is critical to note

that Dr. Etter provided the only medical opinions in this case and

he offered two such opinions. His first opinion, supporting Mr.

Weber's claimed disability as of August 1988, was based entirely on

Mr. Weber's statements to him at a significantly later date; it was

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not based on any medical testing done in 1988 or, indeed, on any

medical records for the period from August 1988 through August

1991.

Dr. Etter's second medical opinion did not support Mr. Weber's

claim of disability in August 1988. That opinion was based on

statements which had been made by Mr. Weber to others at various

pertinent times, specifically regarding his health and the reasons

he left his position with the State; those statements were

inconsistent with Mr. Weber's statements to Dr. Etter.

In short, faced with statements made to others by Mr. Weber

which were inconsistent with those made to Dr. Etter, the doctor

changed his medical opinion to one which did not support Mr.

Weber's claim. How the Court can conclude that the PERB

misapprehended the effect of Dr. Etter's testimony in this regard

is inexplicable to me under these circumstances. Equally

inexplicable is the Court's use of such a technique to reject the

entirety of the PERB's decision.

Indeed, the weight of the medical evidence in this case

supports the PERB's determination. During more than thirty visits

to the VA Medical Center at Fort Harrison from October 1988 to May

1991, not a single complaint was recorded from Mr. Weber of an MSrelated symptom. In fact, doctors who saw Mr. Weber from August

1988 through May 1991 recorded a lapse of double vision complaints

during that time. Importantly, Dr. Etter-relied on by the

District Court and this Court as Mr. Weber's treating physician--

saw Mr. Weber once in August 1988 and did not mention any

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complaints of MS or stress-related symptoms made by Mr. Weber at

that time. He did not see Mr. Weber again until October 1991. As

discussed above, his medical opinion that Mr. Weber was disabled in

August 1988 was not based on medical testing or medical records for

the period August 1988 through August 1991; rather, it was based

entirely on Mr. Weber's statements to him regarding his condition

at that time.

In further regard to Dr. Etter's testimony, the Court states

that the medical opinions of a claimant's treating physician are

entitled to special weight and should not be disregarded absent

specific legitimate reasons for doing so. While I agree with these

general principles, it is my view that there are at least two

specific legitimate reasons for not giving Dr. Etter's medical

opinion supporting Mr. Weber's claim special weight in this case.

First, Dr. Etter was not Mr. Weber's only treating physician during

the period at issue; indeed, Dr. Etter did not even see Mr. Weber

between the time of the resignation and 1991. Second, Dr. Etter's

medical opinion was based entirely on the "history" Mr. Weber

provided him, and that opinion changed dramatically when presented

with other statements made by Mr. Weber which were inconsistent

with those Mr. Weber made to Dr. Etter.

Finally, I note in this regard that giving special weight to

a treating physician does not compel a factfinder to determine that

a claimant is credible; nor does it require giving such special

weight to only one portion of that physician's testimony that all

other evidence of record--including a contrary opinion from that

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physician--is counterbalanced. Yet that is the effect of the

Court's determination that the PERB "misapprehended the effect" of

Dr. Etter's deposition testimony.

The Court also suggests that Mr. Weber's earlier statements

about his health show only that he did not believe himself disabled

at the time of his resignation in September 1988. I could not

disagree more. On the record before us, Mr. Weber is the only

person in a position to state directly the extent to which he was

actually disabled--that is, totally unable to perform his job--in

September 1988. His various statements regarding his health during

that time, made in part in the context of a lawsuit in which he

successfully established that he was wrongfully discharged, are

evidence of the state of his health at that time and of his ability

to perform his job at that time.

In this regard, the Court also makes an anomalous comment on

Mr. Weber's inconsistent health-related statements which relates

back to my earlier-expressed concern regarding burden shifting.

The Court states that Mr. Weber's inconsistent statements "do not

conclusively prove that he was not, in fact, disabled at that

time." While the Court's statement is correct, it is also

irrelevant. Mr. Weber carried the burden of establishing his

eligibility for disability benefits; the PERB had no burden to

establish his ineligibility.

Finally, the Court attempts to undercut the hypothetical

question posed to Dr. Etter, and Dr. Etter's response, by stating

that the question did not acknowledge that MS is an incurable,

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progressive disease subject 'to periods of remission and

exacerbation. Here, the Court is apparently trying to rescue a bad

situation by suggesting that it has more specialized knowledge of

the disease and its ramifications than does Dr. Etter, the supposed

expert in this case. Moreover, the Court's undoubtedly true

statement about the nature of MS has no relevance to whether Mr.

Weber was, in fact, disabled by that progressive disease at the

time he resigned from his job in September 1988. That is the issue

before us.

I conclude that substantial credible evidence supports the

PERB's numerous and detailed findings. I conclude also that the

PERB did not misapprehend the effect of Dr. Etter's testimony or,

indeed, any other testimony; nor am I left with any conviction that

a mistake was made by the PERB. I would reverse the District Court

and reinstate the PERB's decision.

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