NO. 92-488 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1993 

JESS BEERY, Conservator and Guardian 

for Danny Beery, an incapacitated person, 

Petitioner and Appellant, 

-vsGRACE DRILLING, 

Employer, 

and 

CNA INSURANCE COPIPANY, 

Defendant and Respondent. 

APPEAL FROM: Montana Workers1 Compensation Court, 

The Honorable Timothy W. Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: 

Gene R. Jarussi; Jarussi & Bishop 

Billings, Montana 

For Respondent: 

Todd A. Hammer; Warden, Christiansen, 

Johnson & Berg, Kalispell, Montana 

Filed: 

Submitted on Briefs: April 1, 1993 

Decided: August 26, 1993 
Justice John Conway Harrison delivered the Opinion of the Court, 

This is an appeal from a judgment entered in the Workerst 

Compensation Court, the Honorable Timothy W. Reardon presiding. 

The Workers' Compensation Court determined that the claimant, Danny 

Beery (Beery), was not entitled to receive domiciliary care 

benefits, nor was he entitled to his costs, attorney's fees, or a 

penalty. We affirm. 

In his brief, Beery raises issues concerning equitable 

estoppel, waiver, breach of contract, judicial estoppel, attorney's 

fees and costs, and statutory penalties. For reasons discussed 

below, however, the only issue before this Court is whether the 

Workerst Compensation Court erred in concluding that CNA was not 

equitably estopped from contesting Beery's entitlement to 

domiciliary care benefits. 

9- ?Zovemkcrr 4, 1984, Beery a:: industrial injur- ;.r;il= 

working for Grace Drilling. He fell approximately twenty-five feet 

from an oil rig, suffering multiple fractures to his left leg, 

first, second and third degree burns, and a closed head injury that 

initially went undetected. Respondent CNA Insurance Company (CNA) 

served as Grace Drilling's insurer under Plan I1 of the Workerst 

Compensation Act. Beery is currently receiving permanent total 

disability benefits. Those benefits are not contested or at issue 

here. 

In February 1989, CNA petitioned the district court to have a 

limited guardian and conservator appointed to represent Beery and 

manage his affairs regarding his workerst compensation claim. The 

2 
district court appointed Beery's son, Jess, for that purpose. 

Because Beery does not contest the Workers* Compensation 

Court's ultimate determination that he is not entitled to 

domiciliary care benefits under the five part test adopted in 

carlson v. Cain (19851, 216 Mont. 129, 700 P.2d 607, an extensive 

discussion of the medical evidence is not necessary. A summary of 

the three medical panel evaluations Beery underwent provides 

sufficient background for an understanding of this matter. 

In May 1987, the Yellowstone Valley Medical Evaluation Panel 

found that Beery demonstrated significant organic brain syndrome 

and that his intellect, thinking ability, judgment, affect, and 

potential were "markedly impaired." The panel expressed concerns 

about Beery's competency to manage his own affairs but found him 

self-sufficient. It suggested psychological retesting in six to 

twelve months. 

In November 1987, the same panel found that there had been *'no 

significant change' in the test results from the May evaluation; 

therefore, the panel anticipated that Beery's condition had 

stabilized. The panel felt that although Beery did not require 

constant supervision he would need **at least once daily assistance 

and supervision." It did not feel that he needed an attendant to 

help him perform independently the activities of daily living such 

as bathing, dressing, feeding and meeting basic bodily needs. The 

panel did feel that Beery would need assistance in handling his 

financial and legal affairs. 

At CNA's request, a Kalispell medical panel evaluated Beery in 
April 1991. The members of this panel conducted their own 

evaluations and reviewed Beery's extensive medical records and the 

results of the two previous medical panel evaluations. They also 

reviewed surveillance reports and video tapes of Beery that showed 

him driving his truck on numerous occasions and operating a tractor 

on his farm. The panel concluded that Beery did not need a 

personal attendant or domiciliary care. 

Prior to receiving the Kalispell report, CNA had been paying 

Beery domiciliary care benefits. In a letter dated September 25, 

1987, James Putman, CNA's adjuster, stated that CNA would initiate 

payments "pending further evaluation as to the necessity and extent 

of your client's domiciliary requirements . . . [and] as a 

compromise in an effort to avoid premature litigation . . . ." In 

a letter dated March 17, 1988, Putman agreed to pay $616 per week 

for Beery's past care and to continue at that rate in the future. 

On April 30, 1988, the parties entered an agreement entitled 

 compromise, Settlement And Release Of Claim For Payment For 

Domiciliary Care Previously Pro~ided.'~ That settlement covered the 

period from November 24, 1984 through April 16, 1988. The parties 

stated that they desired to "resolv[e] such claim without further 

cost, time, litigation or expense," and the settlement was made 

"without any admissions on anyone's part." 

After entering that settlement, CNA continued to pay benefits 

at the rate of $616 per week. Then, based on the report of the 

Kalispell panel, CNA terminated all payments for domiciliary care 

on August 12, 1991. 
Beery responded to the termination of benefits by petitioning 

the Workers' Compensation Court for a hearing, praying that 

domiciliary care benefits be reinstated. The parties stated the 

issues in the pretrial order as follows: 

1. Whether the claimant has been since August 12, 1991, 

and currently is entitled to receive domiciliary care 

paid for by the Defendant? 

2. Is the claimant entitled to a penalty, reasonable 

costs and attorney fees pursuant to Montana law? 

The partiesb "Statement of Contentionsw in the pretrial order 

merely reiterated the issues stated above. Beery raised the issues 

of waiver, breach of contract, and judicial estoppel for the first 

time in his proposed findings of fact, conclusions of law and 

judgment. Beery raised and briefed the issue of equitable estoppel 

for the first time in his reply to CNAts proposed findings, 

conclusions, and judgment. 

* .. *. ,-.-------I:-- . & -- 7.. I -- L-J LII~ wuLnrLb- buIuprllbabLuu CUULL UUUU LuaL DrrLy uau 

failed to support his need for domiciliary care by medical evidence 

as required by Carlson. The court also concluded that CNA was not 

equitably estopped from terminating benefits. 

In reviewing a decision of the Workers' Compensation Court, we 

determine whether substantial credible evidence supports its 

findings. Richardson v. Columbia Falls Aluminum Co. (1991), 248 

Mont. 41, 43, 808 P.2d 500, 501. In reviewing conclusions of law 

we determine whether the Workers' Compensation Courtbs 

interpretation of the law is correct. Stanley Structures v. 

Scribner (1992), 253 Mont. 236, 239, 833 P.2d 166, 169. 

The Workers' Compensation Court did not address the issues of 

5 
waiver, breach of contract, or judicial estoppel, presumably 

because these were not raised in the petition or the pretrial 

order. Under Rule 16(e), M.R.Civ.P., the pretrial order 

gscontrol[s] the subsequent course of the action unless modified by 

a subsequent order." The pretrial order "should be liberally 

construed to permit any issues at trial that are 'embraced within 

its language." Bell v. Richards (1987), 228 Mont. 215, 217, 741 

P.2d 788, 790 (citations omitted). However, the limited statement 

of issues in the pretrial order in this case cannot be construed so 

liberally as to embrace the issues of waiver, judicial estoppel and 

breach of contract. The threshold question in determining 

entitlement to domiciliary care benefits is whether the five part 

test of Carlson is met. Furthermore, we said in Montana Deaconess 

Medical Center v. Doherty (1990), 241 Mont. 243, 246, 786 P.2d 669, 

671, that "[w]e may on appeal review only those issues decided by 

the District Court . . . . 11 

We distinguish this case from Akhtar v. Van De Wetering 

(1982), 197 Mont. 205, 642 P.2d 149, where we found that there was 

sufficient indication that due process was an issue at the trial 

level to consider it on appeal. There, we relied on the fact that 

due process was referred to extensively in the appellant's trial 

brief and proposed conclusions of law and the district court made 

a specific finding regarding due process. 642 P.2d at 152. In the 

present case, Beery did not argue these issues before the hearing, 

but only interjected them into his proposed findings and 

conclusions. As the Workerss compensation Court did not address 
these issues, we will not address them either. 

Beery does not contest the Workers1 Compensation Court's 

conclusion that he failed to meet the five part test of Carlson for 

entitlement to domiciliary care benefits, Because he did not raise 

or argue this issue in his brief, the issue is deemed waived and we 

need not address it. Teesdale v. Anschutz Drilling Co. (1960), 138 

Mont. 427, 431, 357 P.2d 4, 7: Hagerty v. Hall (1959), 135 Mont. 

276, 283, 340 P.2d 147, 151. See also Schaubel v. Pversen (Mont. 

1993), 848 P.2d 489, 50 St.Rep. 213 (issue of whether district 

court erred in determining that appellants had failed to establish 

prima facia case of negligence was waived because not raised or 

argued in their brief). "This Court will not endeavor to review a 

matter when appellant has directed no argument toward it." Sands 

v. Nestegard (1982), 198 Mont. 421, 428, 646 P.2d 1189, 1193. 

Furthermore, because we hold that CNA properly terminated 

domiciliary care benefits, Beery is not entitled to attorney's 

fees, costs or a penalty. See 55 39-71-611 and 39-71-2907, MCA 

(1983). 

Eauitable EstoDDel 

Beery raised and briefed the issue of equitable estoppel in 

his reply to CNA1s proposed findings, conclusions and judgment. He 

explained that he raised the issue then for the first time because 

"it was not until receipt of the Defendant's Proposed Findings, 

Conclusions, and Judgment that the Claimant realized that the 

Defendant was going to ask this Court to relieve it from the 

obligation to pay for domiciliary care which it willingly undertook 
in 1988 by revealing that it really didn't mean what it said when 

the contract was negotiated." 

The Workersv Compensation Court addressed the issue of 

equitable estoppel, concluding that Beery failed to meet the first 

of six elements required for the doctrine to apply. We have stated 

the elements as follows: 

"1. There must be conduct--acts, language, or silence-- 

amounting to a representation or a concealment of 

material facts. 2. These facts must be known to the 

party estopped at the time of his said conduct, or at 

least the circumstances must be such that knowledge of 

them is necessarily imputed to him. 3. The truth 

concerning these facts must be unknown to the other party 

claiming the benefit of the estoppel, at the time when it 

was acted upon by him. 4. The conduct must be done with 

the intention, or at least with the expectation, that it 

will be acted upon by the other party, or under such 

circumstances that it is both natural and probable that 

it will be so acted upon. . . . 5. The conduct must be 

relied upon by the other party, and, thus relying, he 

must be led to act upon it. 6. He must in fact act upon 

it in such a manner as to change his position for the 

worse. . . . It 

Mellem v. Kalispell Laundry & Dry Cleaners (1989), 237 Mont. 439, 

442, 774 P.2d 390, 392 (quoting Davis v. Jones (1983), 203 Mont. 

464, 467, 661 P.2d 859, 861). We reaffirmed and readopted these as 

the six essential elements in Dagel v. City of Great Falls (1991), 

250 Mont. 224, 819 P.2d 186. However, "[elstoppel is not favored 

and will only be sustained upon clear and convincing evidence.vv 

, 819 P.2d at 193 (quoting Kenneth D. Collins Agency v. 

Hagerott (1984), 211 Mont. 303, 310, 684 P.2d 487, 490). 

We also pointed out in Daqel that 9 26-1-601, MCA, should be 

considered in an equitable estoppel case. 819 P.2d at 193. That 

statute provides: 
List of conclusive presu8lptions. The following 

presumptions are conclusive: 

(1) the truth of a declaration, act, or omission of a 

party, as against that party in any litigation arising 

out of such declaration, act, or omission, whenever he 

has, by such declaration, act, or omission, intentionally 

led another to believe a particular thing true and to act 

upon such belief[.] 

In the present case, CNA's aajuster, Pitman, sent a letter to 

Beery's lawyer on January 7, 1988, stating among other things, "For 

the record, the insurer does not contest your client's entitlement 

to domiciliary care, the full extent and value of which is yet to 

be determined." Beery relies solely on this statement to argue 

that "it must be conclusively presumed that Danny entitled to 

compensated domiciliary care." We disagree. The statement is 

qualified as to both extent and value. CNA made no representation 

that Beery would always be entitled to domiciliary care benefits. 

The extent of care Beery required certainly could change over time. 

The medical evidence from the Kalispell panel was that Beery did 

not require domiciliary care in April of 1991. Therefore, this 

statement did not establish conclusively that Beery was and would 

always be entitled to domiciliary care. This is distinguishable 

from &g.g& where the defendant made an affirmative, unqualified 

statement that the plaintiff was not covered by a contract or 

grievance procedure. 819 P.2d at 188. 

As for equitable estoppel, the Workers' Compensation Court 

found that Beery failed to meet the first of the six elements--a 

representation or concealment of material fact. The Workers' 

Compensation Court reviewed the parties' entire correspondence, 
concluding that it showed CNA's reservations about Beerj's 

entitlement to domiciliary care benefits. 

Specifically, the court relied on the document dated April 30, 

1988, entitled "Compromise, Settlement And Release Of Claim For 

Payment For Domiciliary Care Previously Provided." In that 

document the parties compromised and settled Beery's claim for 

domiciliary care for the period November 24, 1984, to April 16, 

1988. They acknowledged that the purpose of the agreement was to 

resolve any claim Beery had for domiciliary care during that period 

to avoid further cost, time, litigation, or expense. They also 

stated that it was made "without any admissions on anyone's part." 

Based on this, the Workers' Compensation Court concluded that Beery 

could not argue that he was never advised that CNA acknowledged his 

entitlement to domiciliary care only for the purpose of settlement 

and to avoid litigation. 

Beery argues to this Court that the language in the April 1988 

settlement referred only to the specific time period stated 

therein--November 24, 1984 to April 16, 1988--and no other. ,- 

However, it was entered into three months after the January p3, 

1988, letter on which Beery solely relies and covered any benefits 

he received during that period. The fact that those three months 

of payments were made only in the spirit of compromise and "without 

any admissionsw supports the Workers' Compensation Court's findings 

and conclusions that no representation or concealment occurred. 

The Workers' Compensation Court also concluded that the fact 

that the document of April 16 did not mention domiciliary care 
after that date could not be construed to mean that CNA admitted 

Beery was entitled to benefits after that date. 

The correspondence between the parties indicates CNA's 

reservations about Beery's need for domiciliary care. It also 

indicates CNA's willingness to initiate and pay benefits without 

admitting liability fortke reasons stated above. In the September 

25, 1987, letter to Beery's counsel indicating that CWA would 

initiate benefits, Putman stated: 

[Tlhis correspondence will serve to confirm the insurer's 

agreement to initiate biweekly domiciliary payments . . . pending further evaluation as to the necessity and 

extent of your client" domiciliary requirements. This 

agreement is intended as a compromise in an effort to 

avoid premature litigation and is not to be construed as 

an admission of liability [or] waiver of any future 

rights of defense. . . . [I]t is my understanding that 

you agree that the payment of these benefits are in lieu 

of further investigation of your client's cognitive 

impairment and the extent of cognitive deficit through 

further medical panel evaluation . . . . 

sent Beery's counsel a letter on December 10, 1987, stating: 

In addressing your concerns regarding the issue of your 

domiciliary care, I will remain flexible on this issue as 

well. However, prior to any final determinations in this 

regard, I believe it would be appropriate to see what 

changes result from the recommended treatment. 

To this point, CNA had made no representation or concealed anything 

from Beery. The January 7, 1988, letter on which Beery relies 

followed. In that letter, Putman prefaced the specific statement 

Beery relies on by stating, "In conclusion, my correspondence of 

December 10, 1987 clearly references the insure[rI1s position 

regarding the domiciliary care issue." 

The statement Beery relies on cannot be read in a vacuum. It 
must be read in light of the other correspondence between the 

parties and the agreement of April 16, 1988. It must also be read 

in light of the prefacing statement and the qualifying language in 

the statement itself. When read in this manner, it does not amount 

to the ''express[ 1 represent[ation], without qualificationp' that 

Beery argues CNA made. 

Furthermore, even if the first element of equitable estoppel 

were satisfied, Beery could not satisfy the sixth element, which 

requires that he be put in a worse position than he would have been 

had there not been a representation or concealment. The Workers' 

Compensation Court specifically concluded that Beery failed to 

satisfy the requirements that 1) the preponderance of credible 

medical evidence demonstrate a need for home nursing care, with a 

description of that care; 2) the services be performed under the 

direction of a physician; and 3) the services be of the type 

normally rendered by trained attendants and not within the scope of 

normal household duties. Beery argues that because he relied on 

Putmanps statement he made no further attempt after January 1988 to 

establish the five elements of the Carlson test. 

However, Beery had a full opportunity to develop this evidence 

for the hearing. The record before the Workers* Compensation Court 

contained the depositions of Beery's wife and two sons and the 

depositions of some of the doctors from the medical panels that 

evaluated Beery. It also contained the extensive medical records 

and reports and the surveillance tapes produced by the insurer's 

investigator. The Workers' Compensation Court concluded that the 
evidence showed Beery was not entitled to domiciliary care. 

Because he had full opportunity before the hearing to develop his 

case to show that domiciliary care was medically necessary, Beery 

cannot claim he was put in a worse position than he would have 

been. See Berglund and Berglund, Inc. v. Contributions Bureau 

(1990), 241 nont. 49, 784 P.2d 933 (equitable estoppel not 

applicable where plaintiff could not show by clear and convincing 

evidence that he relied on misrepresentation to his detriment). 

We hold that the Workers1 Compensation Court correctly 

concluded that CNA was not equitably estopped from contesting 

Berry's entitlement to domiciliary care benefits. 

Aff inned. 
August 26, 1993 

CERTIFICATE OF SERVICE 

I hereby certify that the following order was sent by United States mail, prepaid, to the following 

named: 

Gene R. Jarussi 

Jarussi & Bishop 

P.O. Box 3353 

Billings, MT 59103 

Todd A. Hammer 

Warden, Christiansen, Johnson & Berg 

P.O. Box 3038 

Kalispell, MT 59903-3038 

ED SMITH 

CLERK OF THE SUPREME COURT 

STAWOF MONTANA