No. 88-396

INTHE SUPREME COURTOF THE STATEOF MONTANA
1989

GLORIA RIGHTNOUR, Claimantand Respondent,

v. KARE-MOR, INCORPORATED, Employer andAppell.ant,
and
INTERMOIJPJTAIN INSURANCE COMPANY,
Defendant and Appellant.

APPEAL FROM: TheWorkers' Compensation Court of the StateofMontana, The HonorableTimothy Reardon,Judgepresiding.
COUNSELOF RECORD:
ForAppellant: LarryW. Jones,Esq.; Garlingt.on,Lohn & Robinson, Missoula, Montana
ForRespondent: R. Lewis Brown, Jr., Esq., Butte,Montana David L. Holland, Esq., Butte, Montana

Submitted on Briefs: December 16, 1988 Decided: February 9, 1989

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# 'ClerkMr. Justice John Conway Harrison delivered the Opinion of the Court.

This casewas originallvbefore this Court in Rightnour

v. Kare-Mor, Inc. (Mont. 1987), 732 P.2d 839, 44 St.Rep. 141, where we concluded that claimant Gloria Rightnour was entitled to medical benefits which were reserved from the settlement agreement. IJpon Rightnour

### 's petition, the Workers' Compensation Court then reopened the final settlement and awarded claimant permanent total disability benefits. This appeal arises from that order and judgment. We affirm. The facts of this case arewell set forth in Rightnour, supra, but simply stated, the facts are these: Rightnour suffered a compensable injury to her lower back while employed by the defendant employer in January, 1983. Appellant accepted liability, and after Rightnour reached a state of maximum healing, a settlement agreement between the parties was reached. In March, 1984,Rightnour tripped and fell while caring for children in her home and re-injured her lowerback. New to the factsof this appeal, however, is the appellant's revelation that Rightnour was self-employed when the 1984 injury occurred. Appellant raises two issues for our review: 

### 1. Was the Workers' Compensation Court correct in concluding that good cause existed to reopen the final settlement? 2. Was the Workers' Compensation Court correct in concluding that, based on this Court's prior decision, Rightnourwas entitled todisabilitybenefits? The parties agree that a final settlement may be reopenedby theWorkers' Compensation Court within four years from the date the settlementwas accepted by that court, ifthere was either a mutual mistake of a material fact, a change in disability, or good cause shown. Section 39-71-204, MCA, (1983) provides in part: (1) Except as provided in subsection (2), the division shall have continuing jurisdiction over all its orders, decisions,and awardsandmay, at any time, upon notice, and after opportunity to be heard is given to the parties in interest, rescind, alter, or amend any such order, decision,or award made by it upon good cause appearing therefor. (2) The division or the workers' compensation judge shall not have power to rescind, alter, or amend any final settlement or award of compensation more than 4 years after the same has been approved by the division. Rescinding, alterinq, or amending a final settlement within the 4-vear period shall be bv agreement between the claimant and the insurer. If the claimantand the insurer cannot agree, the dispute shall be considered a dispute for which the workers

### ' compensation judge has jurisdiction to make a determination.

Section 39-71-2909,MCA, (1983) provides: The judgemay,upon the petition of a claimant or an insurer that the disability of the claimant has changed, review, diminish, or increase, in accordance with the law on benefits as set forth in chapter 71 of this title, any benefits previously awarded by the judge or benefits received by a claimant through settlement agreements. However, the judge may not change any final settlement or award of compensation more than 4 years after the settlement has been approved by the division or any order approving a full and final compromjs~settlement of compensation.The hearing examiner found Rightnour had presented sufficient medical evidence that her disabilityhas increased since the settlementwas entered. Dr. Murphy concluded that Rightnour's impairment rating increased from 20% to 35%; Rightnour hasbeen restricted to a five to eight poundweight restriction on repetitious lifting; and a rehabilitation consultant concluded that Rightnour is no longer able to engage in any occupation inher normal labormarket. We find sufficient evidence existed to enable the Workers' Compensation Court to reopenthe settlementagreement. Appellant next contendstheWorkers' CompensationJudge erroneously concluded that, because the insurer was liable for Rightnour's medical benefits, it logically follows that the insurer is also liable for her disability benefits. As stated in Rightnour, the Workers' Compensation Court concluded: [Tlheclaimanthasproven to a reasonable degree of medical certainty that the original compensable injury of January 19, 1982and the two subsequent surgeries weakened her back, and combined with the fall in her home inMarch, 1984,resulted in a third surgery being required. Such surgery and other medical bills related to that fall are the natural consequence of the original injury. Rightnour, 732 P.2d at 831. We agree the Workers' Compensation Court has not reached an erroneous conclusion. Appellant argues that, under the facts as it nowknows them, i.e., that Rightnour was self-employed when the 1984 injury occurred, it is not liable for the disability benefits. In other words,now that it has conducted proper discovery, appellantwants to relitigate or contest the same liability issue. However, it is of no benefit to the appellant that it failed ta take F.i.qhtnour 

### 's deposition andtherefore did not learn that she was self-employed. As stated in 46Am.Jur.2dI Judgments,

### 5 443: Clearly, the enforcement of the rule of res judicata may not be avoided by the discovery of new evidence bearing on a fact or issue involved in the original action, as distinguished from a subsequent fact or event which creates a new legal situation, even though the newly discovered evidencemight have been sufficient to justify a new trial in the first case.


# .. Furthermore, 46 Am.Jur.2dI Judgments, 474, reads in part: [Tlhe operation of a judgment as res judicata is not affected by a showing that the unsuccessful partv might have prevailed if he had been sufficiently diligent. Hence, the application of the rul-e does not depend upon whether the case was as comprehensively or pursuasivelv presented at the first trial as at the second. In accord with these principles, a litigantmay not avoid the effect of the doctrine, as to an issue presented for determination in the prior action, by failing to offerproof of it. Appellant failed to bring this evidence before the court during the initial litigation and is nowbound by that determination. Also of interest is the appellant's actual or constructive knowledge that Rightnour was self-employed. Rightnour wrote to the insurer prior to the execution of the settlement agreement and informed them shewas going to open
a "Children's Day Care Home" to earn a living. Appellant was, or should have been, well aware that Rightnour was self-employed and the failure to raise this defense does not prevent the appl.ication of res judicata to the initial judgment.Finally,appellant's suggestion that it is excused from adequately developing this defense because the law has changed is also unpersuasive. Whatever the appellant's interpretation may be of our decision in Guild v. Bigfork Convalescent Center (Mont. 1987), 747 P.2d 217, 44 St.Rep. 2139, itsunderstanding of the law as it stood at the time of the initial litigation included the defense of injury during other employment. Belton v. Carlson Transport (1983), 202 Mont. 384, 658 P.2d 405. There is no excuse for failing to raiseRightnour's other employmentas adefense. The judament of the Workers' Compensation Court is affirmed.

We concur:

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