No. 89-575 

IN THE SUPREME COURT OF THE STATE OF MONTANA 

1990 

DONNA HANDLOS , 

claimant and Appellant, 

v. 

CYPRUS INDUSTRIAL MINERALS, 

Employer, Defendant and Respondent. 

APPEAL FROM: The Workers' Compensation Court of the 

State of Montana 

The Honorable Timothy Reardon, Judge presiding. 

COUNSEL OF RECORD: 

For Appellant: PPJ-l 

Monte D. Beck, Esq., and Chris J. Ragar, Esq., 

Beck Law Offices, Bozeman, Montana 

-i 

* -- 

- For Respondent: 

- i.-- 

Larry W. Jones, Esq., Garlington, Lohn & Robinson, - -! 

- ,, Missoula, Montana 

Submitted on Briefs: May 16, 1990 

Decided: July 121 1990 

Filed: 
Chief Justice J. A. Turnage delivered the Opinion of the Court. 

Donna Handlos appeals an order of the Workers1 Compensation 

Court, which she argues should have imposed a penalty and attorney 

fees and costs against her former employer, Cyprus Industrial 

Minerals. We remand for a determination of whether the delay in 

payment of benefits was unreasonable. 

Our opinion rests on our holding that the lower court erred 

in concluding that it was without power to impose a 20 percent 

penalty. Because we remand on that issue, our treatment of the 

other issues raised on appeal is limited. 

Donna Handlos was employed as a sorter for Cyprus Industrial 

Minerals (Cyprus) at its talc mine outside Ennis, Montana. On 

October 2, 1987, a fellow employee struck Handlos on the left side 

of her head while llfooling aroundv1 near the end of the Friday 

evening shift. Although Handlos was wearing a hard hat, she 

testified at trial that the blow resulted in immediate pain causing 

her knees to buckle and making her nauseous. She remained at work 

until the end of her shift, but then went to the emergency room at 

the Madison Valley Hospital complaining of headaches and pain in 

the left side of her neck and shoulder. She was given a shot of 

Demerol and released. 

Handlos saw a doctor the following Monday and on his advice 

did not return to work. He stated that her injury had resulted in 

left thoracic outlet syndrome. An orthopedic surgeon diagnosed her 
injury as left paraspinous muscle spasm exacerbated by a preexisting osteoarthritic condition. Some six months after her injury, 

Handlos was admitted to Ridgeview Treatment Center in Butte, 

Montana, for treatment of depression which was in part a result of 

her injury and resulting inactivity. 

Cyprus initially denied liability for Handlosls injury. In 

March 1988, after the conclusion of mediation proceedings and some 

five months after the injury, Cyprus accepted liability for medical 

expenses for the shoulder injury. It accepted liability for 

medical expenses related to Handlosls depression on August 22, 

1988. Cyprus explained the delays in accepting liability as 

reasonable because of questions as to whether Handlosls injury was 

work-related. Cyprus did not make payment to Ridgeview Treatment 

Center until during the trial. That delay was explained as a 

result of not receiving the bills prior to trial. 

When the trial began, the issues were whether the bills for 

treatment at Ridgeview Treatment Center had been paid and whether 

the delays in payment were unreasonable, justifying a penalty under 

§ 39-71-2907, MCA. After Cyprus paid the bills relating to the 

depression, the only issue remaining was unreasonableness. 

The Workers1 Compensation Court concluded that it was barred 

from awarding a 20 percent penalty under 3 39-71-2907, MCA, because 

Cyprus accepted liability for Handlosls treatment before any court 

order was issued. From that conclusion, Handlos appeals. 
Did the lower court err in concluding that it was without 

power to impose a 20 percent penalty? 

Section 39-71-2907, MCA, provides: 

Increase in award for unreasonable delay or 

refusal to pay. (1) When payment of compensation has been unreasonably delayed or refused 

by an insurer, either prior or subsequent to 

the issuance of an order by the workersv compensation judge granting a claimant compensation benefits, the full amount of the compensation benefits due a claimant between the 

time compensation benefits were delayed or 

refused and the date of the order granting a 

claimant compensation benefits may be increased by the workersv compensation judge by 

20%. The question of unreasonable delay or 

refusal shall be determined by the workersv 

compensation judge, and such a finding constitutes good cause to rescind, alter, or 

amend any order, decision, or award previously 

made in the cause for the purpose of making 

the increase provided herein. 

(2) A finding of unreasonableness under this 

section does not constitute a finding that the 

insurer acted in bad faith or violated the 

unfair trade practices provisions of Title 33, 

chapter 18. 

Handlos argues in the alternative that the Workersv Compensation 

Court was in error in finding that the delay in paying medical 

bills was not unreasonable. However, that was not the basis for 

the court's decision. The court opined that because Cyprus 

accepted liability to pay Handlosvs bill before any order was 

entered, there was no order granting a claimant compensation benefits. Therefore, the court concluded, it was without the power to 

award a penalty under 5 39-71-2907, MCA. 
The lower court's interpretation of 5 39-71-2907, MCA, renders 

all statutory reference to unreasonable delay in the payment of 

benefits as mere surplusage. If the lower court were correct, all 

penalty cases would by definition be refusal of benefit cases. If 

an insurer accepted liability and made payment of benefits at any 

time prior to the issuance of an order by the court, there would 

be no order for benefits making possible consideration of a 

penalty. The words @@unreasonably delayed1@ in the statute would 

then have no purpose. 

We cannot agree with the construction given the statute by the 

Workers1 Compensation Court. We do point out that the statute is 

ambiguous and that the legislature may wish to reword it. 

Where there are several provisions in an instrument, a court 

should give such construction as will give effect to all of them. 

Section 1-4-101, MCA. Additionally, the purpose of the workersg 

compensation system is to enable claimants to @@speedily obtain 

benefitsg@ and to @@minimize reliance upon lawyers." Section 39- 

71-105 (3) , MCA. In light of that purpose and in order to give 

effect to all provisions of the statute, we conclude that the 

penalty under 5 39-71-2907, MCA, is available where an insurer 

unreasonably delays paying a claim until the claimant takes the 

case to trial. We hold that 5 39-71-2907, MCA, allows the Workers1 

Compensation Court to award a penalty when payment of benefits has 

been unreasonably delayed until mid-trial. 
Because the determination of whether there was an unreasonable 

delay in payment of benefits is a factual question, we remand this 

case to the Workersf Compensation Court for an express determination of whether Cyprus unreasonably delayed paying Handlosfs 

benefits. If the court finds that there was an unreasonable delay 

and that a penalty is warranted, it may award a penalty under 5 39- 

71-2907, MCA. Cyprus argues that no penalty is possible within the 

limits set in Perry v. Tomahawk Transp. (1987), 226 Mont. 318, 322, 

735 P.2d 308, 311. However, in Perry the penalty which this Court 

reversed was for payments made in a timely manner, under court 

order, between May 8, 1985, and the date of judgment. There was 

no dispute that a penalty was proper for payments delayed from 

March 27, 1985, to the court order of May 8, 1985. Perry, 735 P.2d 

at 311. On remand, the court should also consider whether an award 

of attorney fees and costs is warranted under !j 39-71-612, MCA. 

Remanded for further proceedings consistent with this opinion. 
We concur: