Beck v. Flathead County

No. 89-235
IN THE SUPREME COURT OF THE STATE OF MONTANA
JOSEPHINE M. BECK,
Claimant and Respondent,
-vs-
FLATHEAD COUNTY, d/b/a FLATHEAD COUNTY
NURSING HOME, Employer, and
STATE COMPENSATION INSURANCE FUND,
Defendants and Appellants.
APPEAL FROM: The Workers' Compensation Court, The Honorable
Timothy Reardon, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Todd A. Hammer, Warden, Christiansen, Johnson & Berg
Kalispell, Montana
For Respondent:
Terry N. Trieweiler, Trieweiler Law ~ i r m ,
whitefish, Montana
Submitted on Briefs: September 27, 1989
Decided: December 1, 1989
Filed:
DEC Pa 1989
Justice Diane G. Barz delivered the Opinion of the Court.
Defendants, Flathead County and the State Compensation
Insurance Fund, appeal the decisions of the Workers'
Compensation Court of the State of Montana, to forego a trial
regarding whether claimant, Beck, had shown substantial
credible evidence of a reduced earning capacity; to adopt the
Findings of Fact and Conclusions of Law dated February 27,
1989; and to forego an evidentiary hearing regarding costs
and attorney fees. We affirm.
Defendants raise the following four issues on appeal:
1. Whether the Workers' Compensation Court erred by
not making any additional findings or conclusions regarding
claimant's pre-injury and post-injury earning capacity.
2. Whether the parties' stipulation regarding
claimant's permanent partial disability benefit rate was
binding for subsequent proceedings.
3. Whether a court should consider claimant's
subsequent injury when considering her future earning
capacity.
4. Whether the Workers' Compensation Court erred by
not holding an evidentiary hearing regarding costs and
attorney fees.
Claimant, Josephine M. Beck, sustained a work-related,
cervical injury on April 11, 1984 while working as a nurse's
aide at the Flathead County Nursing Home. On March 14, 1986,
claimant filed a Petition for Hearing in the Workers'
Compensation Court of the State of Montana. A pretrial order
was signed on May 14, 1986 by a hearing examiner, stating, as
an uncontested fact, that "[c]laimant's partial disability
benefit rate is $126.61. . ." After a May 21, 1986 hearinq
in front of a hearing examiner, the Workers' Compensation
Court adopted the hearing examiner's proposed Findings of
Fact, Conclusions of Law and Judgment. The court then
entered a judgment stating that claimant was not entitled to
permanent partial disability benefits under § 39-71-703, MCA.
Claimant appealed this ruling to the Montana Supreme
Court, arguing that the Workers' Compensation Court erred by
determining that $ 39-71-703, MCA, requires a claimant to
prove an actual wage loss to collect permanent partial
disability benefits. This Court reversed the Workers'
Compensation Court in Beck v. Flathead County (Mont. 1988) ,
749 P.2d 527, 530, 45 St.Rep. 215, 219, stating that " [tlhe
correct test for loss of earning capacity is whether the
injury has caused a loss of ability to earn on the open
market.'' Beck, 749 P.2d at 529, 45 St.Rep. at 217. This
Court then remanded the case to the Workers' Compensation
Court with the directive to "determine whether claimant Beck
[had] shown substantial credible evidence of a reduced
earning capacity." Beck, 749 P.2d at 530, 45 St.Rep. at 219.
The Workers' Compensation Court initially issued an
order scheduling a retrial. Claimant, however, filed a
written objection, by letter, arguing that in Beck this Court
remanded for the sole purpose of considering the previous
Findings of Fact in light of the correct rule of law and not
to issue new Findings of Fact. Claimant pointed out that
neither party appealed from the original Findings of Fact and
therefore argued that a new trial was neither necessary nor
proper. Defendants, however, argued that it had a right to
present additional evidence, in particular, evidence of an
injury claimant sustained subsequent to the April 11, 1984
injury. On April 15, 1988, the Workers' Compensation Court
determined that in light of this Court's decision in Beck, a
new trial was not needed. The Workers' Compensation Court
then entered an order on February 27, 1989 adopting the
hearinq examiner's Proposed Findings of Fact and Conclusions
of Law, and entered an amended Judgment which stated that
claimant had sustained a permanent partial disability and,
under the correct rule of law, was entitled to disability
benefits as agreed upon in the May 14, 1986 Pre-Trial Order.
On April 13, 1989, the court entered its Order awarding
attorney fees and costs based upon the contingent fee
agreement that existed between claimant and her attorney. On
May 1, 1989, defendants filed its Notice of Appeal to the
Montana Supreme Court.
The first issue raised on appeal is whether the
Workers' Compensation Court erred by not making any
additional findings or conclusions regarding claimant's
pre-injury and post-injury earning capacity.
In Beck, we directed the Workers' Compensation Court to
"determine whether claimant Beck [had] shown substantial
credible evidence of a reduced earning capacity." Beck, 749
P.2d at 530, 45 St.Rep. at 219. In Conclusion of Law No. 2,
dated February 27, 1989, the Workers' Compensation Court
concluded that claimant is permanently partially disabled as
a result of her April 11, 1984 industrial accident. Under
5 39-71-116 (12), MCA, (1985), permanent partial disability is
defined as:
[a] condition resulting from injury as
defined in this chapter that results in
the actual loss of earnings or earning
capability less than total that exists
after the injured worker is as far
restored as the permanent character of
the injuries will permit... (Emphasis
added. )
As this Court held in Beck, the correct test for loss of
earning capacity is whether the injury has caused "a loss of
ability to earn on the open market." Beck, 749 P.2d at 529,
45 St.Rep. at 217.
On review, this Court's role is limited to whether
substantial evidence supports the Workers' Compensation
Court's findings and conclusions. Walker v. H.F. Johnson,
Inc. (1978), 180 Mont. 405, 410, 591 P.2d 181, 184. The
hearing examiner found that, based upon a vocational expert's
testimony, if claimant "had to leave her present position to
take a lighter duty job, she would have a diminished earning
capacity." This Court has previously held that this sort of
testimony is sufficient to establish loss of earning
capacity. Hafer v. Anaconda Aluminum, Co. (19821, 198 Mont.
105, 11.1, 643 P.2d 1192, 1195-96; Walker, 180 Mont. at 411,
591 P.2d at 184. However, claimant's own testimony and the
testimonies of the examining physicians and vocational
experts further support this finding. The court then entered
an amended conclusion of law stating that claimant
[rleached maximum healing on May 8, 1986.
Returning to her employment as a nurse's
aide at Flathead County Nursing Home, she
experienced myofascial pain, shoulder
pain, and numbness in her hand, all of
which are aggravated by her work.
Claimant's physicians have recom-
mended certain work restrictions which
are inconsistent with her current
employment and once she leaves her
current employment, she will be
restricted in her ability to compete in
her normal market.
Defendants nonetheless attempt to argue that this Court
"implicitly" directed the Workers' Compensation Court to
conduct an evidentiary hearing so that the Workers'
Compensation Court could make additional findings and
conclusions regarding claimant's pre-injury and post-injury
earning capacity and so that they could have their "day in
court." We disaqree.
In Beck, we held that the Workers' Compensation Court
had to determine the threshold question of whether claimant
had shown substantial evidence of a reduced earning capacity.
The Workers' Compensation Court determined, based upon the
record, that claimant would have a diminished earning
capacity as a result of her accident. The court does not
need to conduct an additional evidentiary hearing because of
defendants' personal desire to have more specific and
tailored findings, conclusions and comparisons. In addition,
defendants have already had their day in court and thus have
had a full and fair opportunity to introduce all evidence of
claimant's pre-injury and post-injury earning capacity. An
additional evidentiary hearing is neither necessary nor
proper. First Bank-Billings v. Clark (Mont. 1989) , 771 P.2d
84, 92, 46 N.Y. St. Rep. 291, 300; Harrington v. Montgomery Druq
Co. (1941), 111 Mont. 564, 567-68, 111 P.2d 808, 810. Upon
review of the record, we hold that substantial credible
evidence supports the court's finding and conclusion
regarding the question of whether claimant had shown
substantial credible evidence of a reduced earning capacity.
The question remained, however, what disability benefit
rate the claimant should receive. Defendants therefore raise
the issue of whether the parties' stipulation regardinq
claimant's permanent partial disability benefit rate was
binding for subsequent proceedings.
The doctrine of res judicata bars this Court from
addressing this issue. This doctrine applies when a litigant
has had the opportunity to litigate an issue but has not
availed himself of the opportunity. The policy behind the
doctrine of res judicata is to prevent piecemeal litigation
and to accord finality as to all issues raised or which
fairly could have been raised. O'Neal, Booth and blilkes v.
Andrews ( 1 9 8 6 1 , 2 1 9 Mont. 496, 499, 712 P . ? d 1327, 1379; -
In
- Estate of Pegg (1984), 209 Mont. 71, 78-79, 680 P.2d 316,
re
320; Wellman v. Wellman (1982), 198 Mont. 42, 45-46, 643 P.2d
573, 575-76.
As already noted, claimant appealed the initial
decision of the Workers' Compensation Court in 1987. In that
appeal, claimant argued that under 5 39-71-703, MCA, she wa.s
entitled to permanent partial disability benefits upon proof
that she suffered a reduced earning capacity. Claimant also
argued that substantial evidence did not support the Workers'
Compensation Court's finding that she did not sustain
permanent partial disability pursuant to S 39-71-703, MCA.
In this second argument, claimant sets forth her testimony,
and the testimonies of her physicians, her rehabilitation
expert, and two vocational experts to illustrate that
substantial evidence did not support the Workers'
Compensation Court's finding that she did not sustain
permanent partial disability. In addition, claimant argued
in her brief that the defendants had stipulated to her
permanent partial disability rate at $126.61 per week and
that this stipulation was binding on the court. Defendants
did not once rebut or mention this matter in their reply
brief. Defendants failed to take the opportunity to litigate
this matter in Beck, and cannot now expect to be allowed to
bring up the issue now. Litigation regarding a matter must
come to an end at some point. Defendants' acquiescence on
this matter in the first appeal bars them from ra-ising it on
this appeal.
The Beck decision, like other judgments, are "binding
and conclusive between all the parties to the suit and their
privies and successors in interest, as to all matters
adjudicated therein and as to all issues which could have
been properly raised irrespective of whether the particular
matter was in fact litigated." Orlando v. Prewett (Mont.
1989), 771 P.2d 111, 113, 46 N.Y. St. Rep. 520, 523 (quoting Kramer
v. Deer Lodge Farms Co. (1944), 116 Mont. 152, 156, 151 P.2d
483, 484). We therefore hold that the doctrine of res
judicata applies in this case and therefore bars defendants
from asserting and arguing that the parties' stipulation
regarding claimant's permanent partial disability benefit
rate is not binding.
The next issue raised on appeal is whether a court
should consider claimant's subsequent injury when considering
her future earning capacity.
In light of the determination that claimant had shown
substantial credible evidence of a reduced earning capacity
and also in light of the parties' stipulation regarding
claimant's permanent partial disability benefit rate, this
issue is now moot. Furthermore, the effect, if any, two
separate injuries would have upon a claimant's disability
benefit rate would more appropriately be addressed at a
hearing regarding the most recent injury. This Co.urt
therefore does not need to address on this appeal whether a
court should consider a claimant ' s subsequent inj.ury when
considering her future earning capacity.
The last issue raised on appeal is whether the Workers'
Compensation Court erred by not holding an evidentiary
hearing regarding costs and attorney fees.
On April 13, 1989, the Workers' Compensation Court
issued an order setting attorney fees and costs. In this
order, the court granted claimant's costs in the amount of
$2,727.86 and her attorney fees in the amount of $20,004.38,
which were based upon the contingent fee agreement.
Defendants first note that they requested an
evidentiary hearing regarding claimant's attorney fees and
costs. Defendants then argue that the Workers' Compensation
Court committed reversible error when it did not hold an
evidentiary hearing on these matters. Defendants rely upon
Honey v. Stoltze Land & Lumber Co. (Mont. 1989), 769 P.2d 42,
46 St.Rep. 202, to argue that an evidentiary hearing must
always be held when addressing attorney fees and costs--even
in cases when an evidentiary hearinq is not requested. We
disagree.
In Honey, the claimant had a contingent fee agreement
with his attorney. After successfully representing the
claimant, the attorney claimed a much larger attorney fee
than was due him in light of the contingent fee agreement.
Under the contingent fee agreement, claimant's attorney was
entitled to $2,208.79. Claimant's attorney submitted time
records and an affidavit to support his claimed attorney fee
of $9,443.50, but he then did not request an evidentiary
hearing. The Workers' Compensation Court nonetheless awarded
attorney fees based on the contingent fee agreement. Honey,
769 P.2d at 43, 46 St.Rep. at 203-04. This Court then held
that the facts in Honey demonstrated a need for an
evidentiary hearing. ---
Honey, 769 P.2d at 44, 46 St.Rep. at
205-06. The facts in Honey, however, are not analogous to
the facts in the present case.
In the present case, defendants acknowledged that the
contingent fee agreement controlled the award of attorney
fees. Defendants' arguments at the lower court, however,
centered around whether the contingent fee rate should be 33%
or 40%, and what constituted a valid pretrial settlement
offer so as to determine the amount the percentage was to be
based upon. Both of these issues are legal issues that do
not require an evidentiary hearing.
Resides awarding claimant attorney fees based on the
contingent fee agreement, the Workers' Compensation Court
also granted claimant's costs in the amount of $119.11 for
travel expenses, $50.00 for a medical conference, and $139.00
i n p r i n t i n g c o s t s , t o t a l l i n g $308.11. Defendants a s s e r t t h a t
these c o s t s a r e not recoverable. Defendants f u r t h e r a s s e r t
t h a t t h i s C o u r t r e q u i r e d t h e Workers' Compensation C o u r t t o
c o n d u c t a n e v i d e n t i a r y h e a r i n g whenever i t a d d r e s s e s a t t o r n e y
fees and costs. On the contrary, t h i s Court i n Wight v .
Hughes Livestock Co. (1983), 204 Mont. 98, 664 P.2d 303,
stated that " [ i ] n t h e r a r e c a s e where a n e v i d e n t i a r y h e a r i n g
is necessary, t h e Workers' Compensation judge s h a l l extend
opportunity f o r hearing . . ." Wight, 204 Mont. a t 1 1 6 , 664
P. 2d a t 313. The f a c t s o f t h i s c a s e d o n o t w a r r a n t s u c h a
hearing.
W e t h e r e f o r e h o l d t h a t t h e Workers' Compensation C o u r t
did not abuse its discretion in determining that an
e v i d e n t i a r y h e a r i n g was n o t n e c e s s a r y i n t h i s c a s e .
Affirmed. I
W e concur: A