No. 87-207 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1987 

RUSSELL A. LAMB, 

Claimant and Appellant, 

-vsMISSOULA IMPORTS, INC., Employer, 

and 

UNIVERSAL INSURANCE CO., 

Defendant and Respondent. 

APPEAL FROM: The Workers' Compensation Court, The Honorable 

Timothy Reardon, Judge presiding. 

COUNSETJ OF RECORD: 

For Appellant: 

Williams Law Firm; Shelton C. Williams, Missoula, 

Montana 

For Respondent: 

Garlington, Lohn & Robinson; Robert E. Sheridan, Jr., 

Missoul-a, Montana 

Submitted on Briefs: Nov. 13, 1987 

Decided: January 19, 1988 

- .(. rJ 1988 , ; : 1- 

Filed: 
Mr. Justice William E. Hunt, Sr., delivered the Opinion of 

the Court. 

Claimant appeals from the judgment of the Workers' 

Compensation Court which denied him an award of attorney's 

fees after adjudging that he was entitled to permanent 

partial disability benefits. Because of a lack of the 

introduction of relevant wage figures, the judge was unable 

to determine the exact amount claimant should receive for 

permanent partial disability benefits. Claimant appeals on 

the issue of attorney's fees. We reverse and remand. 

The specific issues raised for our review are as 

follows: 

1. Whether claimant is entitled to attorney's fees 

pursuant to a prior ruling on the same case which awarded 

fees under 5 39-71-611, MCA. 

2. Whether claimant is entitled to attorney's fees 

under 5 39-71-612, MCA, after going to a hearing which 

resulted in an increase in benefits. 

In 1978, Russell Lamb worked for Missoula In~ports as a 

janitor. On September 11, 1978, he slipped and fell, hitting 

his head on the cement floor. He was diagnosed as having 

sustained a concussion. In February, 1979, Lamb was further 

diagnosed as suffering from epilepsy. Even with medication, 

Lamb had occasional seizures. 

On March 9, 1982, while driving down a busy street, Lamb 

had a seizure. He drove off the road, and hit his car head 

on with a tree, causing serious head injuries and permanent 

brain damage. This Court in Lamb v. Missoula Imports, Inc. 

(Mont. 1984), 684 P.2d 498, 41 St.Rep. 1414, (Hereinafter 

-- Lamb I), affirmed the Workers' Compensation Court in holding 

that Lamb's epileptic seizures were a direct cause of his 
1978 slip and fall injury while working for Missoula Imports. 

Lamb was awarded temporary total disability benefits, 

retroactive to the date of the auto accident. In -- Lamb I, 

claimant received attorney's fees pursuant to 39-71-611, 

MCA . 

In January, 1987, Lamb again went to hearing to 

determine whether he was entitled to increased permanent 

partial disability benefits and domiciliary care payments 

Defendant denied liability for domiciliary care payments, and 

disputed the proper amount of permanent partial disability 

benefits. 

The Workers' Compensation Court found that Lamb was 

entitled to receive payment for both domiciliary care as well 

as permanent partial disability benefits. However, claimant 

failed to introduce evidence of what the pay would be at the 

time of the hearing for someone working as a janitor in the 

same capacity as Lamb was at the time of his injury in 1978. 

Consequently, the court was unable to determine the correct 

amount which Lamb should receive for permanent partial 

disability benefits, but did provide a general formula from 

which to calculate the correct amount. In its order, the 

court encouraged the parties to resolve their dispute using 

the guidance the judge provided. The Workers' Compensation 

Court summarized the issue of a benefits increase in the form 

of permanent partial disability benefits by stating: "There 

is no question of whether claimant is disabled, the only 

question is how much to pay." 

In the -- Lamb I1 judgment, the Workers' Compensation Court 

awarded attorney's fees to claimant on all issues brought 

upon which he prevailed. Irnnlediately following the entry of 

the court's order, the parties agreed on an increase of 

benefits from $52.38 per week to $94.00 per week. In a 

memorandum subsequent to the -- Lamb I1 judgment , the court 
clarified the award of attorney's fees. The judge ordered 

defendant to pay as attorney's fees, 25 percent of claimant's 

future benefits for domiciliary care and a lump sum of 25 

percent of those benefits already received. As to the fees 

pertaining to the issues of permanent partial disability 

benefits, the court denied Lamb's claim on the grounds that 

he did not meet his burden of proof regarding the applicable 

rate. 

We will first address the issue of whether claimant is 

entitled to fees pursuant to § 39-71-611, MCA, or pursuant to 

the ruling and award of fees in -- Lamb I. 

Claimant was forced to hire an attorney and litigate his 

claim in order to receive temporary total disability benefits 

for his 1978 head injury and subsequent injuries sustained in 

1982. The insurer denied liability which was later adjudged 

compensable by both the Workers' Compensation Court and the 

Montana Supreme Court. In -- Lamb I the claimant was properly 

awarded attorney's fees pursuant to § 39-71-611, MCA. 

Following that decision, defendant paid claimant $52.38 

per week for approximately 5 years. When claimant reached 

maximum healing and requested permanent partial benefits 

calculated at a rate which would increase his weekly benefits 

to $120.50 per week, the insurer disputed the amount to be 

paid and denied liability for any amount greater than $52.38 

per week. 

This new round of litigation cannot be construed as 

falling under § 39-71-611, MCA. The insurer was not denying 

liability, but was disputing the amount of compensation owed. 

The facts fall squarely within the language of S 39-71-612, 

MCA (1983) , which was in effect on the date of Lanb's injury. 

The standards for computations of benefits for the claimant 

are fixed by the statutes in effect as of the date of injury. 

Ruckman v. Montana Deaconess Hospital (Mont. 1986), 730 P.2d 
380, 382, 43 St.Rep. 2216, 2218, citing Trusty v. 

Consolidated Freightways (Mont. 1984), 681 ~.2d 1085, 41 

Section 39-71-612, MCA (1983) states: 

(1) If 

payment 

this tit 

an employer or insurer pays or tenders 

of compensation under chapter 71 or 72 of 

le but controversy relates to the amount of 

compensation due and the settlement or award is 

greater than the amount paid or tendered by the 

employer or insurer, a reasonable attorney's fee as 

established by the division or the workers' 

compensation judge if the case has gone to hearing, 

based solely upon the difference between the amount 

settled for or awarded and the amount tendered or 

paid, may be awarded in addition to the amount of 

compensation. 

We hold that neither 5 39-71-611, MCA, nor the Workers' 

Compensation Court ruling in -- Lamb I, which awarded fees 

pursuant to that statute, apply to the facts of -- Lamb I1 as it 

is now before this Court. The applicable statute is 5 

39-71-612, MCA (1983) . Defendant next requests this Court to rule that 5 

39-71-612, MCA, does not mandate an award of attorney's fees 

either. We disagree. 

Defendant asserts that claimant did not prevail on the 

issue of permanent partial disability benefits and therefore 

does not merit an award of attorney's fees. Defendant relies 

on the fact that claimant was demanding benefits of $120 per 

week rather than the $52.38 per week being paid. Further, 

the order from the Workers' Compensation Court did not 

specify any correct amount owed to claimant. 

Although it is true that the court ultimately held that 

claimant did not prevail on his claim for permanent partial 

disability benefits, the language of the opinion and 

resulting increase in benefits would indicate otherwise. The 
specific language used by the Workers' Compensation judge is 

as follows: 

In order to calculate a diminution in earning 

capacity, one must first determine the wages earned 

at date of injury and then compare those wages with 

what claimant's capacity to earn is with his 

disability. Claimant has demonstrated that he has 

- no normal job market. i in din^ of Fact No. 12.) 

However, as the Montana Supreme Court has held in 

McDanold v. E. ~rans~ort, x., - Mont. , P. 2d - - , 41 St.Rptr. 472 (1984), earning 

capacity must be measured by comparing pre-injury 

earning capacity with post-injury earning capacity 

---- in the same time frame. So, in order to properly 

calculate claimant's permanent partial disability 

rate, we would need to know what the iob 4 claimani 

held in September of 1978 would pay today. No 

evidence was presented as to that pay rate. No 

determination -of permanent partial disability can 

be made by this Court. 

The Court would hope that, given the findings and 

guidance herein, the parties should be able to 

resolve this dispute. There is no question of 

whether claimant is disabled, the only question is 

how much to pay. 

Following this judgment, defendant promptly agreed to a 

$41.62 per week increase in benefits to $94.00 per week. 

It is also true that claimant agreed to reduce his 

demand of $120.50, but that does not negate the fact that his 

benefits were ultimately increased as a result of the 

hearing. 

Section 39-71-612, MCA (1983), clearly states that 

claimant is entitled to attorney's fees if "the settlement or 

award is greater than the amount paid by the employer or 

insurer." (Emphasis added.) In this case, the employer 

settled with claimant for more than the amount that was being 

paid before the hearing. If a dispute in amount owed is 

resolved in favor of claimant, this Court inevitably finds 

that an award of attorney's fees is appropriate. Polich v. 
Whalen's O.K. Tire Warehouse (1983), 203 Mont. 280, 661 P.2d 

38; Walker v. H. F. Johnson, Inc. (1978), 180 Mont. 405, 591 

P.2d 181; Catteyson v. Falls Mobile Home Center (19791, 183 

Mont. 284, 599 P.2d 341. 

Although the discretionary word "may" is found in § 

39-71-612, MCA, it does not leave an award of attorney's fees 

totally up to the Workers' Compensation Court's discretion. 

It is a general principle in statutory construction 

that, where the word "may" is used in conferring 

power upon an officer, court, or tribunal, and the 

public or a third person has an interest in the 

exercise of power, then the exercise of the power 

becomes imperative. (Citations omitted.) 

Adoption of Bascon (1952), 126 Mont. 129, 136, 246 P.2d 223, 

The Workers' Compensation Court found that Lamb was 

entitled to permanent partial disability benefits. 

Obviously, the amount of $52.38 being paid by defendant was 

not considered adequate or the court would not have expended 

the time and energy in providing the parties with a formula 

to be used in calculating the correct amount. If the judge's 

formula was meant to lower Lamb's weekly benefits, it is 

inconceivable that defendant so readily agreed to an increase 

of $41.62 per week to $94.00 per week in benefits. 

In light of the foregoing discussion, we conclude with 

the most compelling reason to find that this claimant, under 

these facts, is deserving of an award of attorney's fees 

pursuant to § 39-71-612, MCA. As this Court has said: 

If therefore, the social purpose of Workers' 

Compensation Acts is to provide for the injured 

worker a fund which replaces his lost earnings or 

his lost earning capacity, the reasonable cost of 

effectuating such social purpose where litigation 

is necessary ought also be the burden of the 

industry. Any erosion of the workers' right of 

recovery by imposing upon the worker the cost of 
procuring his rights erodes to that extent the 

social purpose. 

It is clear to us that it is the objective of the 

statutes allowing attorneys fees in compensation 

cases to preserve intact the eventual award 

recovered by the claimant for his impairment, by 

assessing in addition his attorneys fees and costs 

against the insurer or employer. It is a further 

purpose of the statutes to allow the Workers' 

Compensation Court or Division to regulate 

attorneys fees for successful claimants. 

Wight v. Hughes Livestock Co., I~c. (Mont. 1983) t 664 

While the workers' compensation judge may determine 

which attorney's fees are reasonable, the clear 

meaning of [S 39-71-6121 is to provide attorney 

fees above and beyond the compensation awarded to a 

successful claimant. 

Holton v. F. H. Stoltze Land and Lumber Co. (1981), 195 Mont. 

263, 270, 637 P.2d 10, 14. 

We hold that claimant is entitled to an award of 

reasonable attorney's fees on the issue of his permanent 

partial disability benefit rate. The amount is to be based 

solely upon the difference between the amount settled for 

($94.00) and the amount paid ($52.38). Section 39-71-612, 

MCA (1983). 

Reversed and remanded to the Workers' Compensation Court 

for a determination of reasonable atporney's fees. 

We Concur: 
-\ 

Justices