No. 13536 IN THE SUPRElIE COURT OF THE STATE OF MONTANA 1977

TERRY N. WILLIAMS, Claimant and Appellant,

-vsWELLMAN-POWER GAS, INC., Employer, and HARTFORD ACCIDENT & INDEMNITY COMPANY, Defendant and Respondent.

Appeal from: hlorkers' Compensation Court Honorable William E. Hunt, Judge presiding. Counsel of Record: For Appellant: Greg J. Skakles argued, Anaconda, Montana For Respondent: Poore, McKenzie, Roth, Robischon and Robinson,

Butte, Montana David J. Wing argued, Butte, Montana

Submitted: October 7, 1977 Decided: 

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# .+- ClerkMr. Justice John Conway Harrison delivered the Opinion of the Court:
Claimant Terry N. Williams appeals from the finding, conclusions and order of theWorkers' Compensation Court dismissing his claim forbenefits on the ground the claimwas not timely filed. Claimant, an employee of defendantWellman-Power Gas, Inc.,

was injured inthe course and scope of his employment February 15, 1973, when he felland struckhis elbow. He reported the accident tohis employer and was taken to see

### Dr. John P. Lacey, who took X-rays of the elbow. The X-rays were negative, but the doctor could feelbroken cartilage in the injured area. He informed claimant the cartilagewas not likely togive him trouble but therewas a possibility of severe swelling, in which case surgerywould be necessary. No treatment was recommended or administered and claimant returned towork without any loss of wages. The employer was enrolled under Plan 

### 11 of the workers' Compensation Act with insurance coverage provided by defendant Hartford Accident & Indemnity Company. A report of occupational injury and disease was filedwith the Workers' Compensation Division February 20, 1973. The insurer paid the medical expenses for the initialexamination. On April 10, 1973, the divisionnotified the insurer to forward Form 

### 54, Claim for Compensation, to claimant. The Workers' Compensation Court found this form was duly mailed to claimant, along with a cover letter advising him to fillout the form and return it for the insurer's files. Claimant disputes this finding and denies receiving the form.Claimant did not filea claim and apparentlyhad no more trouble with the elbow until the summer of 1975, when he began to experience pain while working for a different employer in Alaska. He returned toDr. Lacey inGctober 1975, and surgery

was performed by a specialist. Claimant fileda claim for compensation with the division December 17, 1975.The division and theWorkers' Compensation Court denied the claim. Claimant presents three issue for review: 1) Did the twelve month statuteof limitation under section 92-601,R.C.M. 1947, prior toamendment in 1973, commence torun only after the discovery of a latent injury? 2) Does the amendment to section 92-601, effectiveJuly 

### 1, 1973, apply to this action? 3) Should the employer and insurerbe found tohave waived and be estopped from asserting the statuteof limitation? Because of our disposition of Issue 2), it is unnecessary todiscuss Issues 1) and 3). On February 20, 1973, the date of the accident, section 92-601, provided: "Claims must be presented within what time. In case of personal injury or death, allclaims shallbe forever barred unless presented inwriting under oath to the employer, the insurer, or theboard, as the case may be, within twelve months from the date of the happening of the accident, eitherby the claimant or someone legally authorized to act forhim inhisbehalf." On July 

### 1, 1973, an amendment to section 92-601 became effective. The amendment did not change the twelve month limitation period but added this paragraph: "The divisionmay, upon a reasonable showing by the claimant of lack of knowledge of disability, waive the time requirement, up to an additional twenty-four (24) months .I1 Claimant petitioned for an extension under this paragraph, but the court concluded the amendment could not be applied retroactively to give the division discretion to allow the claim.Atthe outset, we note that theWorkers' Compensation Act has always been liberally construed in favor of the injured claimant. Section 92-838, R.C.M. 1947; Rumsey v. Cardinal Petroleum, 166Mont. 

### 17, 530 P.2d 433 (1975); State ex rel. Romero v. District Court, 162Mont. 358, 513 P.2d 265 (1973); Ness v. Diamond Asphalt Co., 143Mont. 560, 393 P.2d 43 (1964). We alsonote the 1973 amendment to section 92-601 was passed toalleviate a condition thatwas directly contrary tothe stated purposes and policies of theWorkers' Compensation Act. Prior toJuly 

### 1, 1973, a claimwas required tobe filedwithin twelve months of the date of the accident, regardless of the circumstances. If an injury did not manifest itself untilmore than twelve months after the date of the accident, the injuredparty had no recourse and simply was required tobear the expenses of the injury. Criticismof this'situation 

### iswell expressed in 3Larson, Workmen's Compensation Law, 578.42(b), p. 15-104: "It 

### is odd indeed to find, in a supposedly beneficent piece of legislation, the survival of this fragment of irrationalcruelty surpassing the most technical forfeitures of legal statutes of limitation. Statutes of limitation generally proceed on the theory that 

### a man forfeits his rights only when he inexcusably delays assertion of them, and any number of excuses willtoll the running of the period. Buthereno amount of vigilance is of any help. The limitations period runs against a claim thathas not yet matured; and when itmatures, it isalready barred. 

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# **" The 1973 amendment offered a solution to this problem by granting the division the authority to extend the time period

on a reasonable showing of lack of knowledge of the disability. 

### Inview of these circumstances, it isnot unreasonable to construe the amendment liberally to give itbroad application..iowever, Jeienciallc .~SS~L is that to so construe the .smeridnlentto apply to the instant claim would be a retroactive application of the statute, contrary to section 12-201, R.C.M. 1347, which states: "No law contained in any of the codes or other statutes of Montana isretroactive unless expressly 50 declared." This statute should be read in light of the long-standing defiriition of "retroactive", expressed inButte & Superior Mining Co. v. McIntyre, 71Mont. 254, 263, 229 P. 730 (1924): 

# "* >y >? This isbut a rule of construction. A statutewhich takes away or impairs vested rights, acquired under existing laws, or creates a new 2bligation, imposes a new duty or attaches a riew disability, in respect to transactions already past, is deemed retroactive." See a1sd:City of Harlem 

### v. StateHighway Commission, 149 Mont.

To apply the amendment to claims not alreadybarred at +he tirne the amendment took effectwould not require retroac~ive application within the meaning of this amendment. No vested rights are taken away or impaired. No new duties or Jisabilities are imposed. The amendment simply grants the Jivision the discretion to extend the time period in limited circumstances. The California Supreme Court inMudd v. McColgan, 30 Cal.2d 463, 183 P.2d 10, 13 (1947), considered an amendment which extended a statute of limitations. The court's reasoning

"It isthe settled law of this state that an anlesldment which enlarges a period of limitation spplies topending matters where not otherwise expressly excepted. Such legislation affects the cemedy and is applicable tomatters not already 'mrred, without retroactive effect. Because the speration isprospective rather than retrospective, there 

### is no impairment of vested rights. Moreover aparty has no vested right in the running of a statuteof limitation prior to 

### its expiration. He isdeemed to sufferno injury if, atthe time of an amendment extending the period of limitation for recovery, he isunder obligation to pay. 

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# * Thus true retroactive operation of a limitation statute issuch aswould revive matters that had alreadybeen barred by the lapse of time." This case 

### istherefore distinguishable from Penrod v. Hoskinson, 

### M.D., Mont

# . ,552 P.2d 

### 325, 33 St.Rep. 705 (1976), relied upon by defendants. This Court inPenrod rejected an attempt toretroactively apply a new statute of limitation relating tomedical malpractice which would have limited plaintiff's right to sue under the "discovery doctrine". There was no question inPenrod that defendant was asking for retroactive applicationof the new statute, and we found no manifestation of legislative intent that it be so applied. The instant case does not involve the retroactive application of the amendment but rather the exercise by the division of discretionwhich it had the power to exercise while claimant

was 

### stillentitled to filehis claim. We hold the amendment applies toa11claims existing July 

### 1, 1973, without retroactive effect. Claimant's action had not been barred by July 

### 1, 1973, and therefore the division had the power to consider his petition for'anextension of time. The workers' Compensation Court erred inholding otherwise. While defendants argue thematter 

### is stilldiscretionary with the division and the divisionmay refuse toexercise its discretion, this argument has no merit here. The divisionwas obviously under the false impression ithad no jurisdiction to consider the matter, and refused toexercise 

### itsdiscretion for that reason.The judgment 

### is reversed and the cause 

### is remanded to theWorkers' Compensation Court for further proceedings consistent with this opinion.

We Concur:

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-- ''1 GI, chief Justice I

Justices.



# ........................... Mr. JusticeFrank I. Haswell, specially concurring: 

### I concur in the result in the foregoing Opinion.

Justice