NO. 85-40 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1985 

RALPH V. RELTON, 

Claimant and Appellant, 

-vsCARLSON TRANSPORT, Employer, 

and 

HARTFORD ACCIDENT & INDEMNITY CO., 

Third-Party Defendant and Respondent, 

and 

RICE TRUCK LINE, Employer, 

and 

TRANSPORT INDEMNITY COMPAIU, 

Defendant and Respondent, 

APPEAL FROM: Workers' Compensation Court, The Honorable Timothy 

Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Kelly & Halverson, P.C.; Sheehy, Prindle & Finn; 

Victor Halverson, Billings, Montana 

For Respondent: 

Garlington, Lohn & Robinson; Larry E. Riley, Missoula, 

Montana 

Crowley Law Firm; L. Randall Bishop, Rillings, Montana 

Submitted on briefs: December 20, 1985 

Decided: February 13, 1986 

fLbi 

Filed: i'g@? 
Mr. Justice William E. Hunt, Sr., delivered the Opinion of 

the Court. 

The appellant, Ralph Belton, appeals the judgment of the 

Workers' Compensation Court. That court ordered a recoupment 

of an overpayment related to a social security offset.; denied 

a requested total lump sum conversion; granted a partial lump 

sum conversion; denied penalty for unreasonable payment of 

medical expenses; and ordered payment of medical expenses. 

We affirm in part and remand with instructions. 

Three issues are presented for review: 

1. Whether it was error to permit recoupment of 

overpayments. 

2. Whether it was error to deny a total lump sum 

conversion. 

3. Whether it was error to deny penalty for insurer 

medical payments. 

The appellant, Ralph Eelton, is now 61 years old. He 

suffered a back injury in 1977 while working for Carlson 

Transport. Carlson Transport's compensation insurer was 

Hartford Accident and Indemnity. Hartford accepted liability 

and made payments to the appellant. 

The appellant suffered injury to his back again in 1979. 

This time he was working for Barker Trucking. Barker was 

uninsured, but under contract with Rice Truck Line, insured 

by the respondent, Transport Indemnity. 

The issue of which insurer was liable for successive 

injury in this case was decided in Belton v. Carlson 

Transport, et al. (Mont. 1983), 658 P.2d 405, 40 St.Rep. 158. 

Pursuant to the opinion in Belton the Workers' Compensation 

Court ordered the respondent, Transport Indemnity, to pay the 
appellant's compensation benefits and accident-related 

m.edical costs incurred since the 1979 injury. 

The issues in this case, as it is presently before this 

Court, developed in 1984 when the appellant petitioned for a 

hearing before the Workers1 Compensation Court requesting a 

total lump sum payment, an order requiring the respondent to 

pay medical costs, and a statutory penalty for insurer 

unreasonableness. The respondent answered, requesting a 

denial and a termination of benefits until an existing 

overpayment related to the social security offset was repaid. 

The Workers' Compensation Court denied a total lump sum 

conversion, but it did grant a partial lump sum advance. It 

ordered the respondent to pay the medical expenses, but it 

denied invoking the statutory penalty for insurer 

unreasonableness. It then ordered recoupment on behalf of 

the respondent for overpayment. This recoupment was to be 

paid from the partial lump sum advance. 

The first issue is whether the Workers' Compensation 

Court erred in permitting recoupment of overpayments made by 

the insurers, Hartford and Transport Indemnity. In addition 

to appellant's biweekly compensation payments he received 

social security disability payments. Montana law allows an 

offset against compensation when an injured worker is also 

receiving social security disability. See, §S 39-71-701 (2) 

and 39-71-702(2), MCA. The insurers did not take this offset 

and by the time of the hearing on this matter overpayments 

equalled $18,461.58. Hartford had overpaid $14,630.81 of 

this amount and the respondent had overpaid the balance. 

We hold that the insurers are entitled to the offset as 

found by the Workers1 Compensation Court. 
The second issue is whether the Workers' Compensation 

Court erred in denying a total lump sum conversion. The 

appellant sought a lump sum conversion because he had unpaid 

debts, an inefficient automobile, and costly monthly rent. 

One of the appellant's theories was that an outright purchase 

of a house would help eliminate his financial problems. The 

FJorkers' Compensatjon Court determined that it was in the 

appellant's best interest to award a partial. Iump sum to 

allow discharge of debt and to purchase a fuel efficient 

automobile. However, it determined that the appellant did 

not submit substantial credible evidence that it was in his 

best interest to purchase a home. We agree. 

The Montana Workers' Compensation Act provides for lump 

sum payment. See, § 39-71-741, MCA. The Montana Legislature 

has recently amended this code section. See, Act of April 

1.5, Ch. 471, Laws of Montana (1985). The effective date of 

the amendment followed the hearing on this matter and the 

amendment does not apply in this case. 

The law in effect and applicable to the case presented 

here is that each case for a lump sum payment stands or falls 

on its own merits. Utick v. Utick (1979), 181 Mont. 351, 

355, 593 P.2d 739, 741. The denial of a lump sum settlement 

will not be reversed on appeal unless the Workers' 

Compensation Court is shown to have abused its discretion. 

Ruple v. Peterson Logging Company (Mont. 1984), 679 P.2d 

1252, 1254, 41 St.Rep. 704, 706. The general rule is that 

payments under the compensation act are periodic. Lump sum 

settlements are an exception to this rule. Utick (1979), 181 

Ilont. 351, 354, 593 P.2d at 741. Lump sum settlements are 

only granted where there is "outstanding indebtedness," 

"pressjng need," or where "the best interests of the 
claimant, his family and the general public will be served." 

Willoughby v. Arthur McKee & Co. (1980), 187 Mont. 253, 257, 

609 P.2d 700, 702. 

The appellant here demonstrated outstanding indebtedness 

in the amount of over $5,000 in addition to the $18,000 due 

the insurers for overpayment of benefits. He also 

demonstrated a pressing need for a better automobile. The 

Workers' Compensation Court granted a lump sum payment for 

the debts and the automobile hut denied a total sum that 

would enable the appellant to purchase a house. We hold that 

this denial was a proper exercise of the court's discretion. 

The appellant did not introduce evidence which showed he 

had age or health reasons which necessitated the purchase of 

a home. Testimony by appellant that he wished to avoid 

future escalation of rent payments is not adequate to meet 

the burden of advancing substantial credible evidence, Dumont 

v. Mickens Bros. Construction Co. (1979), 183 Mont. 190, 201, 

598 P.2d 1099, 1105, that there was "pressing need" for him 

to purchase a house. Therefore, we hold the partial lump sum 

advance was proper. 

The third issue presented is whether the Workers' 

Compensation Court erred in denying the appellant penalty for 

respondent's unreasonable treatment of the medical cost 

payment. The respondent was obligated to pay the appellant's 

medical costs but it had refused to make these payments. The 

Workers' Compensation Court found that this refusal was 

unreasonable. The Workers' Compensation Court determined 

that no statutory penalty applied, however, because the 

statute spoke of compensation and not medical benefits. 

This Court recently addressed this issue in Carlson v. 

Cain (Mont. 1985), 700 P.2d 607, 42 St.Rep. 695. We decided