Hueth v. Mark Johnson Masonry

No. 89-571
IN THE SUPREME COURT OF THE STATE OF MONTANA
1990
DENNIS HUETH,
Petitioner and Appellant,
-vs-
MARK JOHNSON MASONRY\STATE COMPENSATION
INSURANCE FUND,
Employer\Defendant and Respondent.
APPEAL FROM: Workers' Compensation Court
The Honorable Timothy Reardon, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
James D. McKenna
0 -
Bozeman, Montana
CO
...
,.
.
-l
.
. r
:'
<. For Respondent:
c -> \
T--+ 1 , Mike McCarter
Helena, Montana
Submitted: March 8, 1990
Decided: October 3 0 , 1 9 9 0
Justice John C. Sheehy delivered the Opinion of the Court.
This appeal involves an application by Dennis Hueth to the
former division of Workers' omp pens at ion, Department of Labor and
Industry, for a waiver of the 12-month statute of limitations
applicable to the filing of a Workersf Compensation claim. Section
39-71-601, MCA. On July 30, 1987, the Division issued an order
denying the application for waiver. Eventually the Workersf
Compensation Court on appeal affirmed the denial of the
application. Dennis Hueth has appealed from the decision of the
Workersf Compensation Court. On consideration, we reverse.
Hueth alleged that he suffered a compensable work-related
injury in January, 1986, while employed by BronkenfsDistributing,
whose compensation insurer at the time was the Orion Group. His
employment with Bronkenfs continued until the end of February,
1986, when he was laid off. He went to work in early March, 1986,
for Mark Johnson Masonry and worked there for approximately a week
and a half. Hueth alleges that he aggravated the injuries to his
knees while working for Mark Johnson Masonry, citing at least two
separate instances of aggravation. He alleges that the aggravating
instances occurred on March 7, 1986.
Hueth retained the services of Attorney Jerry Bechhold (an
attorney later disbarred by this Court) to represent him in his
Workers' Compensation claims. One of those claims was pursued
before the Division and later in the Workersf Compensation Court
against Bronkenfs Distributing. While that claim was pending, on
June 1, 1987, Hueth filed a Workersf Compensation claim respecting
his alleged injuries at Mark Johnson Masonry. On July 13, 1987,
he made application to the Division for a waiver of the 12-month
statute of limitations in 5 39-71-601, MCA, pursuant to the power
given in that statute to the Department to waive the time
requirements up to an additional 24 months. On July 30, 1987, the
Division denied his application for waiver. No appeal was taken
from that decision.
In the meantime, in the parallel action relating to Bronkenvs
Distributing, to which the State Fund had been made a party, the
Workersv Compensation Court dismissed the claim against the State
Fund, the insurer for Mark Johnson Masonry, based on the denial of
the application for waiver entered by the Division. On August 19,
1987, the Workersv Compensation Court granted the motion of the
State Compensation Insurance Fund to dismiss.
Hueth thereafter pursued his claim against Bronkenvs
Distributing, and its insurer, the Orion Group. On December 11,
1987, the Workersv Compensation Court dismissedthat claim upon the
grounds that Hueth had failed to notify his employer, Bronkenvs
Distributing, of his injury as required by § 39-71-603, MCA. While
the Workersv Compensation Court gave the failure to notify the
employer as grounds for its decision dismissing Huethvs claim, it
is apparent from the findings that the Court had considerable doubt
that Huethvs claim against Bronkenvs had occurred on the day and
in the way that Hueth had alleged.
The claim against Bronkenvs and Orion was dismissed on
December 11, 1987.
On February 29, 1988, when Hueth was represented by a new
attorney, Michael Sand, he filed a petition for a contested case
hearing respecting his application for waiver of the one year
filing requirement. This hearing was held before a hearing
examiner appointed by the Division, who entered findings of fact
and conclusions of law on July 28, 1988. Hueth appealed from the
adverse decision in that order to the Workersf Compensation Court,
where it was discovered that the Division's recording of the
hearing had been misplaced. The Workersf Compensation Court
entered an order remanding the matter to the Division for a new
hearing.
The second hearing was held before the hearing examiner in
Bozeman on January 5, 1989. At that time, claimaint was
represented by another attorney, James McKenna. After the hearing,
the hearing examiner filed findings of fact, conclusions of law and
a final order, which was adopted by the Division, and which denied
relief from the agency decision respecting the waiver.
Hueth went again before the Workersf Compensation Court on an
appeal from the decision in his contested case, and again, the
Workersf Compensation Court upheld the denial of the waiver. It
is from that order of the Workersf Compensation Court that this
appeal ensued.
In essence, Hueth alleges that he injured his knees in January
of 1986, while delivering kegs of beer during his employment with
Bronkenfs Distributing. He further claims that on or about March
7, 1986, he aggravated the injuries to his knees while working for
Mark Johnson Masonry, citing at least two separate instances of
aggravation.
He did not file a Workers1 Compensation claim respecting the
injuries at Mark Johnson Masonry until June 1, 1987, 15 months
after the alleged instances of aggravation.
In his testimony before the hearing examiner respecting the
denial of his requested waiver, Hueth testified that he had related
the alleged aggravations of his knee injuries at Mark Johnson
Masonry to his attorney Jerry Bechhold in April, 1986, but he
claimed that he had not realized until April 24, 1987, when his
physicianvs deposition was taken, that an aggravation of a pre-
existing injury was wcompensablell
under the Workersv Compensation
laws. He alleges that the failure to file a claim against Mark
Johnson Masonry within a year of his aggravation is the fault of
his former attorney Bechhold and although he filed an affidavit
stating otherwise, that he was merely following Mr. Bechholdls
instructions in not pursuing his claim against Mark Johnson
Masonry.
Bechhold himself testified at the hearing that he was aware
of the alleged aggravations in April, 1986, and that he had advised
Hueth at that time that Hueth had a possible claim against Mark
Johnson Masonry. He testified that Hueth had a hard time
understanding Workers1 Compensation matters and may not have fully
understood his rights.
Huethls contentions on which he requests reversal are, first,
that he was unaware that the injury he sustained at Mark Johnson
Masonry was a compensable injury and, second, that his attorney,
Bechhold, failed to pursue that claim until after the 12-month
period had ended, although Bechhold knew about the injury at Mark
Johnson Masonry shortly after it occurred. Because there is no
dispute as to the facts in this case, he contends that the standard
of review in this Court is whether the Workers1 Compensation
Courtls interpretation of the law is correct, and that this Court
is free to reach its own conclusions about the proper application
of law to the facts of the case. Wassberg v. Anaconda Copper
Company (1985), 215 Mont. 309, 697 P.2d 909; Solheim v. Tom Davis
Ranch (1984), 208 Mont. 265, 677 P.2d 1034.
The State Fund, on the other hand, contends that Huethls
appeal is blocked because he did not request a contested case
hearing before the Division following the denial of his application
for waiver under Division rules then promulgated by the Division,
and secondly, that his lack of knowledge of his specific legal
remedies and the neglect of his own counsel are not grounds for
waiving the one-year statute of limitations.
As the Workers1 Compensation Court noted, this Court has
tolled the statute of limitations in cases of latent injury,
Bowerman v. State Compensation Fund (1983), 207 Mont. 314, 673 P.2d
476; and when there is estoppel based on the employer's conduct,
Davis v. Jones (1983), 203 Mont. 464, 661 P.2d 859. Here, Hueth
relies on other circumstances which may have tolled the statute as
this Court stated Bowerman:
It is not exclusively evident that in enacting Subsection
(2) of section 39-71-601, MCA, the legislature was acting
only with respect to latent injuries unsuspected by
claimant. The language of Subsection (2) is broad and
could encompass any number of situations where in equity
the Division would be moved to extend the time for filinq
the notice of claim up to the 24 months provided. ...
207 Mont. at 318, 319, 673 P.2d at 478.
The pertinent statute, as it existed at the time of Hueth's
injury read as follows:
39-71-601. Statute of limitations on presentment of
claim--waiver. (1) In case of personal injury or death,
all claims shall be forever barred unless presented in
writing to the employer, the insurer, or the division,
as the case may be, within 12 months from the date of the
happening of the accident, either by the claimant or
someone legally authorized to act for him in his behalf.
(2) The division may, upon a reasonable showing by the
claimant of lack of knowledge of disability, waive the
time requirement up to an additional 24 months.
In Dodd v. Champion International Corporation, (1989), 239
Mont. 236, 238, 779 P.2d 901, 903, we stated with respect to
subdivision (2) of 1 39-71-601, MCA:
In Bowerman, this Court established a three-part analysis
to determine whether the one year statute had been tolled
and the time for filing should be extended by the
Division: first, did the claimant recognize the nature
of his injuries? Secondly, did the claimant recognize
the seriousness of his injury? Thirdly, did the claimant
recognize the probable, compensable character of his
injury? Bowerman, 673 P.2d at 479.
determining, whether under Bowerman, the time for filing
his claim should have been extended by the Division, we find the
evidence shows that the claimant recognized the nature of his
injury, and that he also recognized the seriousness of his injury.
It is the third requirement, whether he recognized the probable,
compensable character of his injury, to which we must address our
attention.
The difficulty for us, and for the Workerst Compensation Court
and indeed the hearing examiner, was the competency of the
attorney, Jerry Bechhold, who was representing Hueth at the time.
In this connection, the findings of the hearing examiner are
important:
10. While Mr. Bechhold testified that he now is of the
opinion that Claimant suffered an aggravation of a pre-
existing injury while working for Mark Johnson Masonry,
he could not recall what his belief was back in 1986 and
could not recall whether in 1986 he was familiar with
Workers' Compensation Court decisions dealing with
aggravation.
11. Assessing the witnesses and the circumstances of
this case, it is doubtful to the hearing examiner that
Mr. Bechhold understoodthat aggravations of pre-existing
injuries were compensable under Montana Workerst
Compensation law or that he properly advised Mr. Hueth
of his potential claims against Mark Johnson Masonry and
its insurer. It appears more likely, based upon a
reading of the pleadings in the Workerst Compensation
Court case and Dr. Andersonts deposition, that Mr.
Bechhold was belatedly alerted to the possibility of a
claim against Mark Johnson Masonry by Steve Carey, the
attorney for the insurer against whom Claimant was
pursuing a claim in early 1987.
Nevertheless, the hearing examiner denied Huethts claim for
a waiver, and the examiner's decision was adopted by the Division.
When the matter was appealed by Hueth from the Division decision
to the Workerst Compensation Court, that court took the position
that Huethls failure to understand legal theories did not of itself
toll the statute. The court stated:
Clearly, Bechhold and Hueth knew of the claimanttsknee
problem in 1986 and his employment history in 1986.
Claimantts failure to understand legal theories of
compensability will not in and of itself toll the
statute. (Citing cases.)
The Workersf Compensation Court then went on to hold that the
failures of Bechhold as an attorney for Hueth were attributable to
Hueth under Ricks v. Teslow Consolidated (1973), 162 Mont. 469,
512 P.2d 1304. The Workerst Compensation Court noted that the
attorney's failures were also that Bechhold failed to file a claim
for compensation against Mark Johnson Masonry, he failed to seek
a contested case hearing before the Division to extend the time,
he failed to timely appeal the Division order and he pursued the
case with Hueth in full support against Bronkenfs Distributing.
In the light of the findings of the hearing examiner, however,
since Bechhold himself apparently did not understand the Workersv
Compensation law, it cannot successfully be asserted that Hueth,
as a claimant, met the third part of the Bowerman test, that he
recognized the probable compensable character of his injury, as
against Mark Johnson Masonry. Under the findings, Hueth obviously
did not recognize the probable compensable character of his injury.
Under these circumstances, the Workerst Compensation Division
should have granted a waiver under 1 39-71-601 (2), MCA, when the
filing was only three months past the 12-month statutory deadline,
and where the Division had discretion to extend the time for an
additional 24 months.
The State Fund has also argued that since Hueth did not file
a request for a contested case hearing within 90 days of the
adverse decision of the Division denying waiver, that such failure
precludes a court review of the substance of his case. The State
Fund cites Division Rule § 24.29.215 A.R.M., which was effective
July 31, 1987, one day after the Division denied Huethrs waiver
request. The State Fund may not rely on this administrative rule,
however, for the reason that the Division did not rely on it. The
hearing examiner noted the provisions of 5 24.29.215 A.R.M., but
stated that instead of relying on the rule, "the Division intends
to make a full record for further review." In addition,
subdivision (4) of the administrative rule provides that the time
limits for request from a contested case hearing may be extended
by the Division for good cause. The same reasons on which we have
determined that the 12-month statute of limitations for filing a
claim should have been waived by the Division are the same reasons
why the Division would have had to extend the time for a contested
case hearing request. The result would be the same in any event.
The administrative rule does not affect the jurisdiction of the
Workersr Compensation Court to determine disputes as to workers1
benefits under 5 39-71-2905, MCA, nor the power of this Court to
affirm, reverse or modify the decisions of the Workersr
Compensation Court on appeal. Section 39-71-2904, MCA and 5 3-2-
204, MCA.
We therefore reverse the Workers' Compensation Court in this
matter. The cause is remanded to the Workersr Compensation Court
for such other proceedings relating to the compensability of
Huethrsclaim, as may be required, without regard to the provisions
of 5 39-71-601, MCA.
We Concur:
-.-.
Chief ~usticg
Justice Diane G. Barz dissenting.
I dissent.
The majority opinion states that the difficulty for the
Workers1 Compensation Court and for this Court was the competency
of the claimant's attorney. That was not the only difficulty.
Another difficulty was the claimant's credibility on whether he
suffered a work-related injury at all on January 2, 1986, let alone
aggravated the injury on March 7, 1986, while working several days
at Mark Johnson Masonry. The findings of fact of the Workers1
Compensation Court dated December 11, 1987, state as follows:
January 2, 1986 Incident
3. On January 2, 1986, claimant alleges he
injured his knees while delivering kegs of
beer down the stairs at the Zoo Bar in
Bozeman, Montana. He felt that ' I . . . going
down the stairs had just aggravated them to
the point where they started hurting more."
(Transcript at 15, 16; Hueth April Deposition
at 85.)
4. Following the alleged January 2, 1986
injury, the claimant continued to work
throughout the entire months of January and
February without missing any work until he was
laid off on February 28, 1986. (Transcript at
39.)
5. Claimant did not seek any medical
treatment for his alleged injury at Bronkenls
Distributorship. He did not take any
medication for this alleged injury. He would
have continued working if he had not been laid
off. (Transcript at 40; Bronken Deposition at
38.)
6. Records of business transactions with the
Zoo Bar, kept in the ordinary course and scope
of business at Bronkenls Distributorship show
there were no deliveries to the Zoo Bar on
January 2. There were no deliveries to the
Zoo Bar from Bronken I s between November 2 1,
1985 and January 8, 1986. (Exhibit No. 4.)
The Zoo Bar is a college-oriented bar which is
essentially closed for Christmas break.
(Transcript at pages 56-58.)
7. Every transaction involving the sale or
exchange of kegs of beer by Bronkenls
employees requires that an invoice be made.
There was no evidence, by way of invoice or
other document, to show a delivery to the Zoo
Bar on January 2, 1986. (Transcript at 58,
59, 66.)
8. Claimant's uncorroborated testimony that
he delivered kegs to the Zoo Bar on January 2,
1986, is not persuasive.
Notice
9. The claimant wrote on his claim for
compensation which was received by the insurer
on April 14, 1986, that he had not notified
his employer of the alleged injury. After the
phrase, I1Who did you notify?I1, the claimant
wrote in Ifnoone.I1 (Transcript at 32, Exhibit
No. 1.) Claimant, in his first deposition,
stated that he did not notify anyone at
Bronken s about the alleged injury. (Hueth
April Deposition at 85; Transcript at 20, 32.)
After stating on his claim for compensation
that no notice was given and in his first
deposition, the claimant then filed an
Affidavit to Modify Deposition Testimony which
was dated July 10, 1987. The Affidavit stated
the claimant had given Peter Bronken notice of
the alleged injury three to five days after it
occurred. (Transcript at 33.)
10. Claimant believes that he told Bronken
about the injury as In. .. kind of a passing
thing. (Transcript at 16.)
11. Claimant's testimony is that he was
confused and nervous when he had written and
stated that he had not given notice to his
employer. The claim form was submitted on
April 11, 1986, over three months after the
alleged injury and after he retained counsel.
(Transcript at 37, 38.)
12. Claimant had filed previous workers'
compensation claims, including one for an
injury which occurred on October 15, 1985.
This claim was filed two and one-half months
prior to the alleged injury of January 2,
1986. (Transcript at 36, 37.)
13. Peter Bronken, who was a credible
witness, testified that he first learned of
the alleged injury on March 21, 1986 in a
phone call to his business while he was out of
state. (Transcript at 60; Bronken Deposition
at 16, 17.)
14. Claimant did not report to Peter Bronken
that he had suffered a knee injury on January
2, 1986, or at any time during January or
February of 1986. No other employees of
Bronken reported that Hueth had suffered a
knee injury. (Transcript at 55.) Claimant
has made no statement that he notified any
other supervisor at Bronkenls Distributorship
and there is no evidence otherwise.
15. Bronken filed an employer's first report
and indicated that he had no notice of the
alleged injury. (Transcript at 61.)
16. On page two of the accident history taken
in a chiropractor's office and signed by the
claimant, it is indicated that the claimant
'
had notified his employer of the alleged
injury on March 3, 1986. On that date
claimant was not employed at Bronken's. (Hueth
Deposition at 87.) (Emphasis in original.)
The claimant clearly had knowledge about filing claims prior
to the January 1986 alleged injury. He is a man with several years
of college. When the claimant filed seeking a waiver on January
13, 1987, he submitted an affidavit in which he disavowed any claim
against Mark Johnson Masonry. In it he stated:
1. It has always been my position that
Mark Johnson Masonry is not the proper party
with respect to my industrial injury. That I
have always believed that Bronkens [sic]
Distributorship is responsible for my
industrial injury. Therefore, at the time
that I filed my Claim Form 54 against Bronkens
[sic] Distributorship, I did not file a Claim
Form 54 against Mark Johnson Masonry.
However, subsequent to my filing my Form 54 I
have learned that possibly Mark Johnson
Masonry could be responsible for my industrial
injury. Said responsibility is premised upon
the fact that at. the time I realized I could
no longer work, I was employed by Mark Johnson
Masonry and not Bronkens [sic] Distributor-
ship. However, it is still my position and
will always be my position that Bronkens [sic]
Distributorship is the party responsible for
my industrial injury. However, at this time
I would request that I be allowed to file a
Claim Form 54 so that the Workers1 Compensa-
tion Judge may make a decision with respect to
the liability of Mark Johnson Masonry and
Bronkens [sic] Distributorship.
I declare the above to be true and
correct under penalty of perjury.
In the deposition taken April 20, 1987, the claimant testified
that he was never injured on the job while working for Mark Johnson
Masonry which contradicts his later testimony that he had suffered
such injuries and told attorney Bechhold about them.
The applicable statute at the time of injury, § 39-71-601,
MCA (1985), provided:
(2) The division may upon a reasonable
showins by the claimant of lack of knowledse
of disabilitv, waive the time requirement up
to an additional 24 months. (Emphasis added. )
The hearing examiner and the Workers' Compensation Court have
not erred in consistently rejecting this claimant's contentions
that the statute should be waived. l