Colmore v. Uninsured Employers Fun

No. 04-310
IN THE SUPREME COURT OF THE STATE OF MONTANA
2005 MT 239RUPERT M. COLMORE, III, a/k/a RUPERT M. COLMORE,
a/k/a RUPERT COLMORE, individually, and COLMORE
MANAGEMENT COMPANY, LLC, as general partner, and
RUPERT M. COLMORE, EUNICE R. COLMORE and FIRST
FARMERS AND MERCHANTS NATIONAL BANK as trustee
for MARY P. COLMORE, VIRGINIA DALE GUILD COLMORE,
and EUNICE BAXTER JACKSON COLMORE, as limited partners,
in COLMORE PROPERTIES, L.P. a/k/a COLMORE PROPERTY
LIMITED PARTNERSHIP,
Petitioners and Appellants,
v.
UNINSURED EMPLOYERS’ FUND and
JACQUELINE RENEE FORGEY,
Respondents and Respondents.
APPEAL FROM: Workers’ Compensation Court, State of Montana,
The Honorable Mike McCarter, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Michael J. Lilly, Berg, Lilly & Tollefson, P.C., Bozeman, Montana
For Respondent Uninsured Employers’ Fund:
Mark Cadwallader, Special Assistant Attorney General, Department of
Labor and Industry, Helena, Montana
For Respondent Forgey:
Daniel B. Bidegaray and Anna M. Bidegaray, Bidegaray Law Firm, L.L.P.,
Bozeman, Montana
Submitted on Briefs: November 18, 2004
Decided: September 22, 2005
Filed:
__________________________________________
Clerk
Justice John Warner delivered the Opinion of the Court.
¶1 Rupert M. Colmore (“Colmore”) appeals from a Judgment of the Workers’
Compensation Court concluding that the decedent, Douglas Forgey (“Forgey”) was
Colmore’s employee at the time he died in a work-related accident on September 14, 2000,
and that Colmore, as an uninsured employer, is required to indemnify the Uninsured
Employer’s Fund for death benefits paid to Forgey’s beneficiaries. We affirm in part and
reverse in part.
¶2 We address the following issues on appeal:
¶3 1. Did the Workers’ Compensation Court err in concluding that Forgey was not a
casual employee and, therefore, was entitled to Workers’ Compensation benefits?
¶4 2. Did the Workers’ Compensation Court err in determining that an error in
calculation of the benefits could be corrected more than a year after benefits were
determined?
I. FACTUAL AND PROCEDURAL BACKGROUND
¶5 Colmore is a long time resident of Tennessee. Colmore retired from farming in
Tennessee in 1994. However, he still owned a 400 acre clear-cut parcel in Tennessee that
he was in the process of re-planting in 2000. Prior to retiring, Colmore established a limited
partnership named Colmore Properties, L.P. (“Colmore Properties”), for the purpose of:
[I]nvesting in, acquiring, developing, holding, constructing, managing,
operating, leasing, subleasing, owning, selling, exchanging, or otherwise
dealing in land, buildings, improvements, and any interest or rights therein for
agricultural uses and management of natural resources . . . .
Colmore, his wife Eunice and their three daughters are limited partners of Colmore
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Properties. Colmore Management Company, L.L.C., is the general partner of Colmore
Properties. Colmore was the “Chief Manager” of Colmore Management Company.
¶6 Colmore Properties acquired Poison Creek Ranch near Livingston, Montana, in
August of 1997. When the ranch was initially purchased, it was primarily used for
recreational purposes. The ranch consists of 680 acres and a home. The property was
partially fenced, but the house and the fences were in a state of disrepair.
¶7 On January 1, 1998, Colmore individually leased the ranch from Colmore Properties.
The purpose of the lease was described as follows:
The express purpose of this lease is for agricultural purposes only, specifically
the grazing and caring of cattle, horses and livestock and the planting of feed
grains and other livestock supporting crops; and the exclusive use and
occupancy of the house located on the Premises.
The lease required Colmore to maintain the property as follows:
[L]essee agrees to furnish all necessary material, labor, chemicals, seeds,
fertilizers, and equipment to properly apply all necessary fertilizer; treat
noxious weeds; maintain the land as agricultural land; plant, grow and harvest
seasonal crops on the Premises; and conduct all agricultural practices
reasonably related to the growth and harvest of seasonal crops on the Premises
and grazing and care of cattle, horses, and livestock, all at the Lessee’s sole
cost and expense. Lessee shall cultivate the Premises in a good and
husbandlike manner in accordance with the best agricultural methods, and in
accordance with applicable laws, including environmental laws. Lessee shall
be responsible for the maintenance, care and upkeep of the property.
¶8 Colmore Properties paid for the repairs to the home to make it habitable for Colmore
and his wife. The Colmores moved into the home in November 1998. They lived there
during the summer and returned to Tennessee each year for the winter months. Colmore
maintained a small farming operation at Poison Creek Ranch, planting less than an acre of
wheat for the purpose of attracting birds to the ranch, and several acres of hay. Colmore
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pastured his wife’s horses at the ranch and he allowed a neighbor to pasture his horses on the
ranch in exchange for looking after the ranch during the winter months. The neighbor also
gave Colmore a horse and built a corral on Colmore’s property.
¶9 Colmore brought farm equipment with him from Tennessee including three tractors,
a plow, a roller, a hay rake, and a grain drill, and the auger involved in Forgey’s death. Prior
to the incident in question, Colmore had not sold any livestock or crops and had not filed a
Montana Income Tax Return. Colmore had not opened a Montana bank account, and
handled all of his financial transactions out of his Tennessee accounts.
¶10 Colmore became acquainted with Forgey in 1999 when he was working at a ranch
located next to the Poison Creek Ranch. In early August 2000, Forgey told Colmore that he
was considering quitting his ranch job and starting his own fencing business. Forgey asked
Colmore if he had any fencing work that he could do for him. Colmore said that he did not.
In late August, Forgey told Colmore he had quit his job and was starting his fencing
business. He asked Colmore if he could give him some work. Colmore agreed to employ
Forgey for three to four weeks.
¶11 Colmore agreed to pay Forgey $12 per hour. He also agreed to reimburse him for any
materials purchased. Forgey provided his own hand tools, but Colmore provided a tractor
and an auger. Forgey began fencing for Colmore on August 10, 2000. Colmore told Forgey
which sections of fence to work on and Forgey did the work. On September 14, 2000, while
working on the ranch, Forgey, who was working alone, was caught in the auger and died as
a result of his injuries. Colmore found his body at the worksite. Over the four weeks that
Forgey worked for Colmore he earned $1800, and was paid in cash.
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¶12 On April 30, 2001, Jacqueline Renee Forgey (“Mrs. Forgey”) filed a beneficiary’s
claim for compensation with the Montana Department of Labor and Industry (“Department”)
requesting Workers’ Compensation benefits for herself in connection with the death of her
husband. She stated in the form, that she signed and filed, that Forgey worked for Colemore
for four weeks and was paid $1,800. The Department determined that an employment
relationship existed between Colmore and Forgey at the time of Forgey’s death. The
Department further found that Colmore was required by law to carry Workers’
Compensation Insurance for Forgey. Accordingly, the Department ordered Colmore
Properties to pay Workers’ Compensation benefits to Mrs. Forgey.
¶13 As Colmore Properties failed to provide Forgey with Workers’ Compensation
Insurance, the Uninsured Employer’s Fund (“UEF”) began paying benefits to Mrs. Forgey
on July 27, 2001.
¶14 Colmore Properties filed a Petition for Dispute Resolution with the Workers’
Compensation Court (“WCC”) on October 17, 2002. On February 12, 2003, the WCC held
a trial to resolve the dispute. On April 18, 2003, the WCC was advised that an additional
issue concerning the appropriate wage and compensation needed to be addressed. On May
1, 2003, Mrs. Forgey filed a motion to amend the wage and compensation rate paid by the
UEF, thereby requesting an increase in the average weekly wage from $300 to $443. The
UEF stipulated that a calculation error was made and $443 was the proper average weekly
wage. Counsel for all parties submitted the issue on an agreed statement of facts and
documents. The WCC directed the parties to file the agreed statement of facts and briefs for
its consideration.
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¶15 On March 4, 2004, the WCC entered its Findings of Fact, Conclusions of Law and
Judgment, in which it concluded that Colmore, individually, was Forgey’s employer, and that
Forgey was not a “casual employee” or “independent contractor.” Therefore, Colmore was
required to provide Workers’ Compensation Insurance to Forgey, and Mrs. Forgey was
entitled to payment based on an average wage of $443 per week. Colmore’s appeal is limited
to the WCC’s findings that Forgey was not a casual employee and the amount of the benefit
payment.
II. STANDARD OF REVIEW
¶16 We review findings of fact to determine if they are supported by substantial, credible
evidence, and we review conclusions of law to determine if they are correct. Hiett v.
Missoula County Pub. Sch., 2003 MT 213, ¶ 15, 317 Mont. 95, ¶ 15, 75 P.3d 341, ¶ 15. In
Workers’ Compensation cases, the law in effect at the time of the claimant’s injury
establishes the claimant’s substantive right to benefits. Hiett, ¶ 15.
III. DISCUSSION
ISSUE ONE
¶17 Did the Workers’ Compensation Court err in concluding that Forgey was not a
casual employee and, therefore, was entitled to Workers’ Compensation benefits?
¶18 Section 39-71-401(1), MCA (1999), provides that “[e]xcept as provided in subsection
(2), the Workers’ Compensation Act applies to all employers, as defined in 39-71-117, and
to all employees, as defined in 39-71-118.” Colmore does not dispute on appeal that he is
an employer as defined by § 39-71-117, MCA (1999), and that Forgey was his employee as
defined by § 39-71-118, MCA (1999). However, Colmore argues that the Workers’
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Compensation Act (“Act”) is not applicable under the facts of this case because Forgey was
engaged in “casual employment” as defined in § 39-71-116(7), MCA, and therefore, was
exempted from coverage under the Act. See § 39-71-401(2)(b), MCA (1999). Casual
employment is “employment not in the usual course of the trade, business, profession, or
occupation of the employer.” Section 39-71-116(7), MCA (1999). The Act does not define
“course of trade, business, profession, or occupation.”
¶19 Relying on Miller v. Granite County Power Co., 66 Mont. 368, 376-77, 213 P. 604,
607 (citing Marsh v. Groner (Pa. 1917), 102 A. 127, 129) and Nelson v. Stukey (1931), 89
Mont. 277, 300 P. 287, in which this Court stated that the word “business” means the
“habitual or regular occupation that a person [is] engaged in with a view to winning a
livelihood or gain,” Colmore argues that he was not engaged in a “trade, business,
profession, or occupation” because he did not lease the ranch to earn a livelihood.
Accordingly, Colmore argues that Forgey’s employment on the ranch was “casual
employment,” which exempted Forgey from mandated Workers’ Compensation coverage.
Colmore also relies on Vogl v. Smythe (Idaho 1953), 258 P.2d 355, and Barlow v. Anderson
(Tex. Civ. App. 1961), 346 S.W.2d 632, for the proposition that employment is not in the
usual course of trade, business, profession or occupation when there is no profit motive
involved.
¶20 Colmore argues that the WCC’s Findings of Fact support the conclusion that Colmore
was not engaged in any trade, business, profession or occupation, because he had retired
from farming in Tennessee in 1994; maintained minimal agricultural operations on the ranch;
had not filed a Montana tax return or opened a bank account in Montana; and Colmore only
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lived in Montana part of the year.
¶21 Colmore further argues that the fact that he deducted the expenses associated with the
ranch on his Federal Income Tax Return; signed a lease with Colmore Properties for the
purpose of grazing cattle, horses and livestock, for planting grain and other livestock
supporting crops; and intended to develop the ranch for agricultural purposes, provide
insufficient proof that he relied on the ranch to earn a livelihood or to make a profit.
¶22 As we previously have stated, “[t]he line of demarcation between what is and what
is not employment in the usual course of trade, business, profession, or occupation of the
employer is vague and shadowy.” Nelson, 89 Mont. at 286, 300 P. at 288. Therefore, such
determination must be made on a case-by-case basis and a single employer may, in fact, have
more than one trade or business. Nelson, 89 Mont. at 286, 300 P. at 288-89.
¶23 This Court has drawn the following distinction between improvements to property that
constitute activities in the usual course of business and those which do not:
The mere owning of a house, maintaining it, and keeping it in repair and
renting it, so that it may produce an income, is not sufficient to constitute a
business, nor does the owning and renting of more than one house necessarily
constitute a business; but such transactions at most only amount to a regular
business, within the meaning of the compensation act, when they are carried
on to such an extent as to require a substantial and habitual devotion of time
and labor to their management and operation.
Nelson, 89 Mont. at 289, 300 P. at 290 (quoting 50 A.L.R. 1177).
¶24 In Nelson, we held that a worker injured while building an addition to an apartment
complex owned by a dentist was employed in the usual course of the dentist’s business.
Nelson, 89 Mont. at 288, 300 P. at 289. We reached this conclusion because the dentist was
also engaged in the business of being the owner and operator of a 15 unit apartment complex,
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and the construction work was being done in the furtherance of his existing rental business.
Nelson, 89 Mont. at 288-89, 300 P. at 289-90.
¶25 Here, as in Nelson, Colmore hired Forgey to complete a task that was in furtherance
of his existing business–running an agricultural operation. See Nelson, 89 Mont. at 288-89,
300 P. at 289-90. The fact that Colmore may have been engaged in other businesses,
including Colmore Properties and Colmore Management Company, is inconsequential in our
analysis. See Nelson, 89 Mont. at 286, 300 P. at 288-89. The fact that Forgey was only
employed temporarily is also not significant. See Industrial Accident Board v. Brown Bros.
Lumber Co. (1930), 88 Mont. 375, 381-82, 292 P. 902, 904 (holding that a worker injured
while helping a truck driver get his lumber truck out of the mud was employed in the usual
course of the lumber company’s business even though he was employed to complete a single
task).
¶26 The important fact is that Forgey was employed to work for Colmore in the course
of his agricultural business, and that Forgey’s only occupation at the time was to repair and
replace fences for Colmore. See Carlson v. Cain (1983), 204 Mont. 311, 321, 664 P.2d 913,
918 (holding that the fiancé of a newspaper carrier hired to deliver papers was employed in
the usual course of the newspaper’s business when she was injured in a car accident while
making deliveries).
¶27 The facts in this case are distinguishable from those in Vogl and Barlow. In Vogl, the
employer was not required to provide Workers’ Compensation coverage for a worker he
hired to clear a road to his summer home because it was maintained separately from his
business properties. Vogl, 258 P.2d at 357. Here, Colmore hired Forgey to replace and
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repair fencing on a working ranch that Colmore leased as a tax write-off to decrease his
federal income tax on other income-producing ventures. In spite of what Colmore would
have us believe, the ranch was not maintained solely as a summer vacation home.
¶28 Likewise in Barlow, the employer was not required to provide Workers’
Compensation coverage for his horse trainer because there was no evidence that he kept the
horses for profit – he did not breed the horses or sell them, but kept them merely as an
expensive hobby. Barlow, 346 S.W.2d at 633-34. By contrast, while Colmore claims he
leased the ranch as a hobby, he deducted all of the expenses of running the ranch as
“business” expenses on his Federal Income Tax Return. Therefore, even though he did not
make a profit running the ranch, he did operate the ranch with a profit motive in mind – that
of reducing his overall income tax through the business expenses he incurred while operating
the ranch. We agree with the Texas Court of Appeals when it said:
We do not believe it is necessary to come within the Workmen’s
Compensation Act that the ‘employer’ must make a profit but we do believe
the profit motive is an important characteristic of an operation such as the one
we are here considering in order for the operation to come within the
designation of a trade, business, profession or occupation.
Barlow, 346 S.W.2d at 634.
¶29 Colmore leased the property from his limited partnership for the express purpose of
running an agricultural business. Under the terms of the lease, Colmore was obligated to
furnish all of the material, labor, and equipment necessary to maintain the land as agricultural
land. Colmore was also required by the terms of the lease agreement to carry business risk
and liability insurance to cover any claims arising out of the agricultural operations of the
ranch.
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¶30 As part of the ranch operations, Colmore leased pasture land to area ranchers for
grazing purposes and was responsible for maintaining the fences on the property. Colmore
admitted in his deposition that he had hired at least two other people to repair and replace
fences on the property in addition to the work Forgey was hired to complete. Colmore also
allowed a local rancher to run horses on his property. In exchange, the horse owner built a
corral on Colmore’s property and gave Colmore a horse. The rancher also fed Colmore’s
horses and kept an eye on the property while Colmore was in Tennessee for the winter.
¶31 Perhaps most significantly, Colmore deducted $140,983 from his federal income
taxes, in 2000, based on the agricultural deductions and depreciation claimed for both his
Montana and Tennessee farming operations. Colmore claimed deductions for the rent he
paid to lease the ranch, depreciation on the farm equipment, and for payment of Montana
taxes. Additionally, Colmore claimed deductions for expenses incurred from repairing the
fences on the ranch.
¶32 These facts are sufficient to support the conclusion of the WCC that Colmore operated
the ranch with a profit motive, thereby qualifying Forgey’s employment for Workers’
Compensation coverage. See White v. Comm. of Internal Revenue (6th Cir. 1955), 227 F.2d
779, 779 (a profit motive is necessary to deduct ordinary and necessary business expenses
on a federal income tax return).
¶33 We conclude that the WCC did not err in concluding Forgey was not a casual
employee and, therefore, was entitled to Workers’ Compensation benefits.
ISSUE TWO
¶34 Did the Workers’ Compensation Court err in determining that an error in
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calculation of the benefits could be corrected more than a year after benefits were
determined?
¶35 Section 39-71-520, MCA (1999), provides that “[a] dispute concerning uninsured
employers’ fund benefits must be appealed to mediation within 90 days from the date of the
determination or the determination is considered final.”
¶36 Colmore argues that the WCC erred in concluding that § 39-71-520, MCA (1999), did
not prohibit the UEF from correcting a calculation error and from increasing the weekly
payments to Mrs. Forgey because she failed to appeal the determination of benefits within
the 90 days allowed by law. We agree.
¶37 The UEF notified Mrs. Forgey by letter dated July 27, 2001, that she was entitled to
death benefits based on an average weekly wage of $300. The letter included the following
explanation of how the benefits were calculated:
Pursuant to Section 39-71-721(2), MCA, your Beneficiary entitlement is
calculated as follows: $1,800.00 (total earnings) / 6 (total weeks worked) =
$300.00 (Average Weekly Wage)
$300.00 * 2/3 = $200.00 (Weekly Rate)
The letter also specifically stated:
If you do not agree with any of the determinations or calculations contained
in this letter, you may request mediation. Under section 39-71-520 of the
Workers’ Compensation Act if you do not appeal this decision within 90 days
this determination is considered final.
This notice is not in legalese. It is easily read by a layperson. It made clear to Mrs. Forgey,
and anyone else who bothered to read it, that it is calculated on six weeks of earnings.
Further, it makes it clear that it is a final determination if not contested in 90 days. When
Mrs. Forgey filed the First Report of Injury with the Department of Labor on April 30, 2001,
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she clearly indicated that her husband earned $450 per week. Therefore, it is not
unreasonable to expect that Mrs. Forgey should have recognized that the UEF made an error
in calculating Forgey’s average weekly wage by dividing $1800 by 6, instead of 4 weeks.
Both Mrs. Forgey and Colmore had 90 days to appeal the decision to the UEF. Colmore
appealed the decision on the grounds that Forgey was an independent contractor, or in the
alternative, was a casual employee, and therefore, was not entitled to benefits. Colmore’s
appeal was mediated on September 6, 2001, in accordance with the procedures set forth in
§ 39-71-520, MCA (1999). When the attempt at mediation failed, Colmore filed a petition
for dispute resolution with the WCC.
¶38 Mrs. Forgey argues that because Colmore appealed the UEF’s decision to grant
benefits within the 90 days provided by statute, that she was relieved from her statutory duty
to cross-appeal the calculation of Forgey’s average weekly wage. She further argues that she
could not have appealed within 90 days because she did not become aware of the mistake
in calculation until much later.
¶39 This Court has long held that the time limits for filing an appeal are mandatory and
jurisdictional. Joseph Eve & Co. v. Allen (1997), 284 Mont. 511, 514, 945 P.2d 897, 899.
Therefore, an appellant has a duty to perfect its appeal in the manner provided by statute.
Joseph, 284 Mont. at 514, 945 P.2d at 899. Absent such compliance, this Court lacks
jurisdiction to hear the appeal. Joseph, 284 Mont. at 514, 945 P.2d at 899. In a similar
fashion, this Court has held that failure to properly file a cross-appeal precludes this Court
from addressing the issues raised in the cross-appeal. Joseph, 284 Mont. at 514, 945 P.2d
at 899. A cross-appeal is necessary where the respondent seeks review of matters “separate
13
and distinct” from those sought to be reviewed by the appellant. Joseph, 284 Mont. at 514,
945 P.2d at 899 (citing Johnson v. Tindall (1981), 195 Mont. 165, 170, 635 P.2d 266, 268).
¶40 More than two parties are involved in this case. UEF and Mrs. Forgey may agree to
ignore the time requirement of § 39-71-520, MCA (1999). However, they and the dissent
ignore the rights of Colemore, the one who would be required to make the increased payment
if this Court were to affirm the order of the WCC. Colemore made no stipulation to increase
the average weekly wage calculation some 17 months after it became final by law. He had
the right to rely on the amount fixed in considering his position in this litigation and in going
about his business. The question of whether UEF is responsible to Mrs. Forgey is not before
us. As far as Colemore is concerned, Mrs. Forgey had a statutory duty to follow the same
procedure as Colmore because the issue she raised regarding the proper amount of benefits
was separate and distinct from the issue raised by Colmore as to whether benefits should
have been provided in the first place. She failed to appeal the issue to the UEF. Had she
done so, and had the issue not been resolved through mediation, she too could have filed a
petition with the WCC to resolve the dispute. It was not until sometime during discovery
in the underlying case that her attorney noticed what he believed was the error. On May 1,
2003, he filed a motion with the WCC requesting that the court order the error corrected,
even though the determination of benefits became final at the end of October 2001 and had
not been properly appealed to the UEF.
¶41 The WCC considered the motion to amend during trial in spite of the fact that the
issue was not properly before the court, as mediation is a prerequisite to filing a petition in
the WCC, and a failure to request mediation bars the court from reviewing UEF
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determinations. Sections 39-71-2401(1), 2408(1), and 2905(1), MCA (1999). In increasing
the benefit amount, the WCC erroneously relied on South v. Transportation Ins. Co. (1996),
275 Mont. 397, 401, 913 P.2d 233, 235, in which this Court concluded that full and fair
settlement agreements are contracts and may be rescinded if parties were laboring under
mutual mistake regarding material fact, at the contracts inception, which impacted the
agreement to such a degree that the contract may be rescinded. However, there was no
settlement contract in this case. Section 39-71-520, MCA (1999), places a limitation on the
time within which a claimant may dispute a determination of benefits regardless of the merits
of her position.
¶42 The notice sent to Mrs. Forgey was designed to tell her, without the necessity of
hiring a lawyer, the average weekly wage upon which her benefits would be calculated. UEF
advised her of this fact and also how her benefits would be calculated, in plain English. She
may not have examined the notice, and may not have realized that UEF had made a mistake.
UEF presumably did not realize it miscalculated the average weekly wage. However, a
statute of limitations for actions based on a mistake does not depend on actual discovery of
the alleged mistake before it begins to run. D’Agostino v. Swanson (1989), 240 Mont. 435,
443, 784 P.2d 919, 924. Rather, the limitations period begins to run when the facts are such
that the party seeking relief would have discovered the mistake had he exercised ordinary
diligence. D’Agostino, 240 Mont. at 443, 784 P.2d at 924; Gregory v. City of Forsyth
(1980), 187 Mont. 132, 136, 609 P.2d 248, 251. In the exercise of ordinary diligence UEF
should have realized that it miscalculated the average weekly wage, as should have Mrs.
Forgey. Absent grounds for avoiding a statute of limitations, which were not advanced here,
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the determination of benefits became final when it was not contested. Accordingly, the
WCC was without jurisdiction to hear her motion to amend benefits. See § 39-71-2401(1),
MCA (1999).
¶43 We hold that the WCC erred in increasing the average weekly wage upon which
benefits are calculated to $443 per week.
IV. CONCLUSION
¶44 We affirm the judgment of the WCC that Forgey was not a casual employee. We
reverse the WCC’s judgment requiring an increase in benefits based on an average weekly
wage of $443 per week rather than an average weekly wage of $300.
/S/ JOHN WARNER
We Concur:
/S/ JIM RICE
/S/ GARY DAY
District Court Judge Gary Day
sitting in for Justice Leaphart
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Chief Justice Karla M. Gray, specially concurring.
¶45 I join the Court's opinion on issue one. I concur in the Court’s resolution of issue
two, but not in all that is said in that regard. In addition, with due respect for the dissent’s
understandable desire that Mrs. Forgey receive the benefit to which she would have been
entitled under different circumstances because of the erroneous original calculation of
benefits by the UEF, I cannot agree with the analysis presented to reach such a conclusion.
Moreover, while the dissent presents many arguments not raised by Mrs. Forgey, I address
portions of the dissent below.
¶46 In my view, the following facts are pertinent to the appropriate resolution of issue
two. Mrs. Forgey filed a claim for death benefits in April of 2001, at which time she was
33 years old. She filled in the required form by hand and, insofar as we can determine, was
not represented by counsel at that time or at any time prior to--or soon after--the UEF's
decision. Mrs. Forgey’s claim form reflects that she claimed benefits based on her deceased
husband’s gross earnings of $1,800 while working for Colmore for four weeks. The “four
pay period” time frame for which she supplied his gross earnings is part of the printed form.
Eighteen hundred dollars divided by four weeks results in an average weekly wage for Mr.
Forgey of approximately $450 per week for the purpose of calculating the benefits to which
Mrs. Forgey might be entitled.
¶47 On July 27, 2001, the UEF notified Mrs. Forgey by letter that her benefits entitlement
was calculated as
$1,800.00 (total earnings)/6 (total weeks worked) =$300.00 (Average Weekly
Wage)
$300.00 * 2/3 = $200.00 (weekly rate)
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(Emphasis added.) The final substantive paragraph of the letter stated, in its entirety:
If you do not agree with any of the determinations or calculations contained
in this letter, you may request mediation. Under section 39-71-520 of the
Workers’ Compensation Act if you do not appeal this decision within 90 days
this determination is considered final. To obtain the appropriate forms,
contact the Workers’ Compensation Claims Assistance Bureau, Mediation
Unit, P.O. Box 1728, Helena, Montana 59624 or call (406) 444-6534.
Mrs. Forgey did not “request mediation” or “appeal this decision” within 90 days. Indeed,
it appears likely she did not notice the discrepancy between her claim, as submitted, and the
UEF’s final decision within the 90-day period.
¶48 Colmore timely sought dispute resolution in the WCC. The WCC held a two-day
trial on one day in February, and one day in April, of 2003. During the second day of trial,
the parties informed the WCC that an issue had arisen regarding the proper rate of benefits.
On May 1, 2003, Mrs. Forgey formally moved to amend the UEF’s compensation rate. The
parties submitted an agreed statement of facts, which included that the original UEF
calculation was erroneous and that Mrs. Forgey had not timely objected. The WCC
ultimately concluded that § 39-71-520, MCA (1999), did not preclude Mrs. Forgey from
receiving the corrected amount of benefits.
¶49 These relevant facts require that we first focus on § 39-71-520, MCA (1999), which
provides that “[a] dispute concerning uninsured employers’ fund benefits must be appealed
to mediation within 90 days from the date of the determination or the determination is
considered final.” As stated in the UEF’s letter to Mrs. Forgey--written in less “legalese”
than the statute--any disagreement with determinations or calculations contained in the
UEF’s decision must be raised within 90 days and, absent objection within that time, the
UEF’s determination is final.
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¶50 The statute clearly constitutes a 90-day statute of limitations for a claimant seeking
further action on a UEF determination. Whether we focus on the word “dispute,” used in
§ 39-71-520, MCA (1999)--as relied on by the dissent--or the phrase “disagreement with
determinations or calculations”--contained in the UEF’s letter--Mrs. Forgey had 90 days to
review the UEF’s calculations and, if she disputed or disagreed with them, seek her statutory
remedy. She did not so do. On that basis, I join the Court in concluding that no issue
regarding the UEF’s calculation of the benefits to which Mrs. Forgey was entitled survived
the 90-day period of limitations.
¶51 Moreover, it is my view that our recent decision in Hand v. UEF, 2004 MT 336, 324
Mont. 196, 103 P.3d 994, is analogous. There, the claimant filed a claim for benefits under
the Occupational Disease Act (Act). At some subsequent time, the Department of Labor and
Industry (Department) entered an Order of Determination finding that the claimant had an
occupational disease and was entitled to certain benefits under the Act. The claimant
appealed pursuant to § 39-72-612, MCA (1997), which provided a 20-day limit for appeal--
absent which the Order would become final--and the case continued to the WCC. The UEF
did not appeal from the Department’s Order, but attempted to have portions of it reviewed
and changed in the WCC. See Hand, ¶¶ 8, 11, 12.
¶52 Notwithstanding the 20-day limit to appeal the Department’s Order contained in § 39-
72-612, MCA (1997), the WCC allowed the UEF to raise substantive affirmative defenses.
On appeal, we concluded the UEF lost its opportunity to have the Department’s findings and
conclusions reviewed by failing to timely perfect its appeal from the Department’s Order of
Determination, and that the Order had become final as to the UEF after the 20-day
19
limitations period. See Hand, ¶ 27.
¶53 Pursuant to our reasoning in Hand, Mrs. Forgey is as barred in the present case from
late-raising issues that became final 90 days after the UEF’s determination as the UEF was
barred in Hand. All of us no doubt have sympathies to Mrs. Forgey’s plight; however, it is
our obligation to apply the law as it is written and to do so evenhandedly. In both Hand and
the present case, one party timely “appealed” and one party did not. The result in both cases
must be the same.
¶54 On this latter point, applying the law as written, the dissent repeatedly suggests that
the Court has failed to set forth the applicable rules of statutory construction. There is some
truth here. At least as important, however, is the dissent’s purported reliance, in ¶ 77, on the
“plain meaning” rule, and its own interpretations of § 39-71-520, MCA (1999).
¶55 I agree generally with the definitions of “dispute” and related terms advanced by the
dissent. One could hardly disagree that Black’s Law Dictionary contains these definitions.
¶56 From these undisputed--at least by me--definitions, however, the dissent travels to
several very interesting places. It states without equivocation--and also without authority--
that a dispute cannot exist unless it is expressed. Thus, no expression of dispute equals no
dispute. This is a sympathetic interpretation in the present case. The plain words used in
the statute do not support it. If the Legislature intended to say “if you get around to
expressing a dispute within 90 days, go for it, but if you don’t get to it until some later time,
that’s OK
too,” it could readily have said so. Clearly, it did not.
¶57 The dissent also relies on a “mutual mistake of fact” notion in the context of its plain
20
meaning analysis. Apparently, the dissent believes the plain meaning of the statute of
limitations contained in § 39-71-520, MCA (1999), is that if, two years after a determination
is final, one party “discovers” an error and the other party agrees that an error was made, the
original determination never became final. Indeed, what the dissent seems to contend for,
in an overall sense, is the insertion of the clause “or the date the dispute is discovered” into
the existing language of § 39-71-520, MCA (1999). While in this case that language would
achieve a sympathetic result, the fact remains that the statute simply says nothing of the sort.
¶58 The dissent also urges that nothing in the plain meaning of the statute indicates that
all determinations are final if not appealed within 90 days. The statute says what it says:
“[a] dispute concerning [UEF] benefits must be appealed to mediation within 90 days from
the date of the determination or the determination is considered final.” Little more need be
said, except to note that nothing in the statute indicates that some determinations are not final
if not appealed within 90 days. Moreover, additional clarity for a proper understanding of
the situation by a lay person--if any were needed--was provided in the UEF’s determination
letter.
¶59 The dissent also attempts to tie the “plain meaning” of § 39-71-520, MCA (1999), to
the language contained in § 39-71-601(1), MCA (1999), on the Orr “context in which they
reside” theory. I agree wholeheartedly that the language used by the Legislature in these two
statutes is very different. I observe, however, while both statutes are part of the Workers’
Compensation Act, the statutes in Title 39, chapter 71, part 5--including § 39-71-520, MCA
(1999)--apply expressly to “uninsured” employers in the context of UEF proceedings.
Section 39-71-601(1), MCA (1999), on the other hand, is contained in part 6 of the Act,
21
captioned “Claims for Benefits.” The dissent’s effort to read something into these two
different statutes is murky at best.
¶60 The dissent properly highlights the Legislature’s public policy in the workers’
compensation arena. Indeed, § 39-71-105(3), MCA (1999), clearly provides that the system
is “intended to be primarily self-administering[, and] minimize reliance upon lawyers and
the courts to obtain benefits and interpret liabilities.” In the present case, Mrs. Forgey, a lay
person, competently and correctly filled out the simple UEF claim form. Upon receiving the
UEF’s determination on her claim, she could just as easily and competently have reviewed
the claim she had submitted and seen that the UEF’s calculation was based on a 6-pay-period
length of time, rather than the 4-pay-period time frame required by the form she had
completed. In other words, had Mrs. Forgey taken the time to merely contrast her claim with
the UEF’s calculation, I am confident she would have timely followed the instructions in the
UEF letter. She did not act with diligence in performing this simple task and, consequently,
the 90-day limitations period came and went. See D'Agostino, 240 Mont. at 443, 784 P.2d
at 924. As a consequence, under § 39-71-520, MCA (1999), the UEF’s determination
became final.
¶61 The dissent urges that the Court’s decision on this issue will force lay people to
“either have to become proficient in the fine points of benefit calculation, or employ
professional legal assistance” in reviewing the UEF’s benefits calculations, all in
contravention of the public policy set forth in § 39-71-105(3), MCA (1999). Under the facts
of this case, I cannot agree. The UEF’s letter determination set forth precisely how the
calculation was performed. Even I--known by virtually every one who knows me (and
22
readily admitted by me) to be “numerically challenged”--can readily see, by a quick
comparison with Mrs. Forgey’s claim, the UEF’s error. I believe that, having seen the error,
I would have followed the clear instructions contained in the letter setting forth how I should
proceed if I did not agree with the calculation and how to obtain assistance. Mrs. Forgey
could as easily have done so.
¶62 The dissent goes on to contend that, because Mrs. Forgey did not timely discover the
error as she could have done, no “dispute” existed under § 39-71-520, MCA (1999). To
follow this logic to its natural conclusion would, in essence, be the end of statutes of
limitations.
¶63 The purpose of statutes of limitations is to suppress stale claims for purposes of basic
fairness. Gomez v. State, 1999 MT 67, ¶ 25, 293 Mont. 531, ¶ 25, 975 P.2d 1258, ¶ 25.
Under the dissent’s logic, no limitations period for taking an appeal or the next step in an
administrative proceeding would exist so long as no one bothered to check on whether a
dispute should exist. Appeals or next step requirements with time limitations are intended
to require a person to timely determine whether a dispute or disagreement exists, from her
or his standpoint, with the outcome of a proceeding. I cannot conceive that the dissent
would conclude that a person involved in a civil action in a district court--whether
represented or appearing pro se--could simply ignore the usual 30-day time for filing a notice
of appeal from a trial court’s final judgment to this Court on the basis that she or he did not
have a “dispute” at that time, but might get around to discovering one later. Our cases are
legion that, absent a timely appeal, we are without jurisdiction to consider an appeal. See,
e.g., In re Matter of M.B. (1997), 282 Mont. 150, 152-53, 935 P.2d 1129, 1130 (citation
23
omitted).
¶64 Moreover, the dissent’s reliance on the “mutual mistake of fact, acknowledged by
both parties,” is somewhat misleading. It is arguable that the “mistake of fact” was really
a mistake of fact and law. In any event, however, the UEF’s erroneous calculation was not
a mutual mistake of any kind at the time of its occurrence. Nor was the calculation
“reached” pursuant to a mutual mistake as the dissent states. The UEF’s erroneous
calculation was simply an error, but one which could readily be seen. That the UEF made
an error is unfortunate. However, the reality is that we all make mistakes. The intent of §
39-71-520, MCA (1999), is to encourage claimants to timely review the UEF’s calculations
and determinations and, if a disagreement or dispute arises, to timely take the next step
required by law or lose the ability to do so.
¶65 In summary, I agree with the dissent that Mrs. Forgey originally was entitled to
benefits based on 4 weeks of work at an average weekly wage calculation of $443. I
disagree with the dissent’s position that she remained entitled to benefits based on that
average weekly wage calculation after letting the 90-day period of limitations run. Had a
party in an ordinary civil action failed to file a timely notice of appeal either to a district
court from a court of limited jurisdiction or to this Court from a district court, the party
would--by its own inaction--no longer be entitled to the relief which might have been
available on appeal. I cannot see that this case is any different.
¶66 For the reasons stated, I join in the Court’s conclusion that the Workers’
Compensation Court erred in increasing the average weekly wage upon which Mrs. Forgey’s
benefits are calculated.
24
/S/ KARLA M. GRAY
25
Justice James C. Nelson concurs and dissents.
¶67 I concur with our decision as to Issue One. I disagree with our resolution of Issue
Two and, therefore, dissent. I would affirm the Workers’ Compensation Court as to both
issues.
¶68 Issue Two turns on a statute that contains a time period for advancing an appeal. This
time period begins to run, as do all statutory time periods, upon the existence of certain
specified conditions. Here, the statute at issue provides that the existence of a “dispute” is
a prerequisite condition for the running of this time period. Thus, the “dispute” requirement
is just that--a requirement. It is not a condition which courts are free to disregard when they
see fit. Yet, the Court has ignored this requirement, and has effectively undercut the
legislature’s public policy determination regarding our interpretation of Workers’
Compensation laws.
¶69 Five things are undisputed as to Issue Two. First, the UEF--the State agency in
charge of correctly calculating UEF benefits--made an error in calculating Mrs. Forgey’s
benefits. This error substantially impacted her benefits by reducing the calculation of Mr.
Forgey’s average weekly wage from $443.00 to $300.00--a 32% reduction. Second, the
UEF stipulated that it made the error and that the error should be corrected. Third, Mrs.
Forgey not only did not know of the error--she relied on the State agency charged with
correctly calculating her benefits--but also, and more importantly, by the time she, through
her attorney, discovered the error, her cross-appeal time had long since passed. Fourth, upon
discovering the error, Mrs. Forgey immediately notified the UEF and Colmore’s counsel and
26
filed a motion to correct the clerical error. Fifth, Colmore stipulated that the UEF’s initial
benefit calculation was flawed, and that Mr. Forgey’s average weekly wage was in fact
$443.00. The error at issue here was simply a ministerial mistake unilaterally made by the
agency and mutually acknowledged by the UEF, the claimant, and the uninsured employer.
There was no dispute involved and none to appeal.
Statutory Interpretation
¶70 Section 39-71-520, MCA (1999), requires that a “dispute” concerning uninsured
employers’ fund benefits must be appealed to mediation within ninety days from the date of
determination or the determination is considered final. Here, there was no “dispute” at issue
during the ninety days after the UEF’s benefit determination because Mrs. Forgey, not
surprisingly, was unaware that the UEF had erred in computing her benefits. Indeed, there
was a mutual mistake of fact1 by both the UEF and Mrs. Forgey as to the determination of
benefits--both parties thought the benefit amount was computed correctly, but both parties
were wrong. While § 39-71-520, MCA (1999), provides specific guidelines for the
resolution of disputes over benefit calculations, it says nothing of corrective re-calculations
where no such dispute has ever existed. Nonetheless, the Court disregards the plain
language of the statute and thereby bars a re-calculation of benefits based on an average
weekly wage of $433.00--a figure which Colmore, Mrs. Forgey, and the UEF have all agreed
is correct.
1
This use of the phrase “mutual mistake of fact” is not intended to signal the
operation of the legal doctrine of “mutual mistake” as it is known in the realm of contract
law. Rather, it is merely intended to be descriptive of the misunderstanding shared by
Mrs. Forgey and the UEF.
27
¶71 The Court fails to acknowledge that resolution of this issue requires statutory
interpretation and, consequently, fails to utilize or cite to any rules of statutory construction
in rendering its simplistic interpretation of the statute at issue here. This failure is necessary
to the Court’s Opinion, because not a single rule of statutory construction supports its
interpretation of § 39-71-520, MCA (1999). Moreover, this failure is indicative of the
Court’s casual approach to the interpretation of this statute, which amounts to nothing less
than a revision thereof.
¶72 Proper interpretation of this statute requires that we first consider what a “dispute”
is. The Workers’ Compensation Act does not define this term. Black’s Law Dictionary, 8th
Edition, defines a “dispute” as a “conflict or controversy, esp. one that has given rise to a
particular lawsuit.” In turn, Black’s defines a “controversy” as a “disagreement or a dispute”
and a “justiciable dispute.” Further, Black’s defines a “disagreement” as a “difference of
opinion” or a “quarrel.” These definitions indicate that a “dispute” can not exist unless a
party expresses an argument. Such an expression is inherent in the existence of a
“controversy” or “disagreement” and is, of course, necessary to the existence of any lawsuit.
In other words, the very nature of a “dispute” is the clashing of stated ideas or claimed
positions. This conclusion is supported by Black’s definition of a justiciable dispute as a
dispute that is “capable of being disposed of judicially.” Obviously, no dispute can be
“disposed of judicially” without an expression of argument from at least one party, which
is initially made in the pleadings, because no court can take notice of a dispute unless it is
presented by way of an expression of argument.
28
¶73 Our jurisprudence regarding the issue of standing provides further support for the
conclusion that a “dispute” necessarily entails an expression of argument. Standing is a
threshold issue in every case. In re Parenting of D.A.H., 2005 MT 68, ¶ 7, 326 Mont. 296,
¶ 7, 109 P.3d 247, ¶ 7. “[A] court that would otherwise have jurisdiction to hear and decide
a matter will not have jurisdiction if a person without standing attempts to bring the action.”
In re Parenting of D.A.H., ¶ 8. As our case law holds:
In the context of challenges to government action, we have stated that
the following criteria must be satisfied to establish standing: (1) The
complaining party must clearly allege past, present or threatened injury to a
property or civil right; . . . .
Armstrong v. State, 1999 MT 261, ¶ 6, 296 Mont. 361, ¶ 6, 989 P.2d 364, ¶ 6 (emphasis
added). Thus, we see that no judicially cognizable dispute exists without an expression of
argument.
¶74 Based on the foregoing, I conclude that a “dispute” necessarily entails an expression
of argument. That is not to suggest that this conclusion should be the starting point of
reference in every consideration of the term “dispute.” This term appears in various statutes
throughout the Workers’ Compensation Act, and may well take on different nuances of
meaning depending on the context and manner in which it is used. Here, the term “dispute”
is used in a unique and primary fashion--i.e., it is designated as the event which triggers the
running of the ninety-day time period for appeal. As such, I believe it is necessary to
consider the essence of a “dispute” in order to determine whether one occurred here.
¶75 Neither Colmore nor Mrs. Forgey expressed any argument regarding the UEF’s
determination of benefits during the ninety days after the initial calculation. Because no
arguments were expressed, no dispute existed. The fact that a mistake had been made does
29
not establish the existence of a dispute. Further, to the extent we can attach any meaning to
the silence of the parties, it appears that all were in agreement regarding the benefits
determination. The Special Concurrence claims that the natural conclusion of this reasoning
would spell the end of statutes of limitations. This hyperbole demonstrates either a failure
to recognize or, worse, the bald refusal to acknowledge the unique nature of the statute at
issue. More to the point, an interpretation of § 39-71-520, MCA (1999), which gives effect
to its unique use of the term “dispute” would have no bearing on a statute that does not
employ that term in the context used here.
¶76 Having found some meaning in the term “dispute,” a word which the Court apparently
refuses to recognize, I now turn to the consequences of such meaning in light of the rules of
statutory construction.
¶77 In construing a statute, the intent of the legislature is controlling, and such intent must
first be determined from the plain meaning of the words used. Security Bank v. Connors
(1976), 170 Mont. 59, 66-67, 550 P.2d 1313, 1317. Here, the plain meaning of the words
at issue indicate that only “disputes” must be appealed to mediation within ninety days. The
term “dispute” precedes and qualifies the requirement of appeal in this statute. Thus, a
claimant has no duty to appeal if no dispute exists.
¶78 If we are to allow this term to retain any meaning apart from the term “agreement,”
which is essentially what Mrs. Forgey and the UEF had reached pursuant to a mutual
mistake of fact, we must conclude that § 39-71-520, MCA (1999), designates an appeal time
for “disputes” only. As the Special Concurrence notes, our obligation is to apply the law as
it is written. In doing so, we must recognize that the term “dispute” has some meaning
30
which is consequential in the operation of the statute. Unfortunately, the Court and the
Special Concurrence choose to render this term meaningless.
¶79 General rules of statutory construction require this Court to interpret the statutory
language before us without adding to it or subtracting from it. Orr v. State, 2004 MT 354,
¶ 68, 324 Mont. 391, ¶ 68, 106 P.3d 100, ¶ 68. Here, the Court engages in either significant
addition to or subtraction from § 39-71-520, MCA (1999), thereby rewriting it. It appears
that the Court has either removed the term “dispute,” which is a prerequisite to the
application of this statute, or has added some other undisclosed phrase which renders the
term “dispute” meaningless. In other words, the Court’s approach requires us to either:
(1) assume that a “dispute” exists immediately and in every single case; or (2) ignore the
“dispute” requirement altogether.
¶80 Words and phrases used in the statutes of Montana are construed according to the
context in which they reside. Orr, ¶ 68. The Court treats § 39-71-520, MCA (1999), as a
typical statute of limitations. However, the legislature clearly set this statute apart from the
general statute of limitation governing presentment of claims under the Workers’
Compensation Act, which appears just a few code sections after the statute at issue in the
case sub judice. That statute of limitations provides:
In case of personal injury or death, all claims must be forever barred unless
signed by the claimant or the claimant’s representative and presented in
writing to the employer, the insurer, or the department, 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 on the claimant’s behalf.
Section 39-71-601(1), MCA (1999) (emphasis added). Obviously, this provision includes
more comprehensive and restrictive language than is used in the statute at issue here, in that
31
it clearly bars any recourse for all claims not pursued within the applicable time period. If
the legislature had intended that § 39-71-520, MCA (1999), be treated as a typical statute of
limitations, thereby operating to bar any recourse not pursued within ninety days from the
time of initial benefit calculation, then the legislature would have undoubtedly used language
similar to that of § 39-71-601(1), MCA (1999), as it has done with the various other statutes
of limitations found in Montana’s code. Instead, the legislature chose to qualify
§ 39-71-520, MCA (1999), with the term “dispute,” as opposed to the phrase “all claims,”
thereby rendering it significantly distinct from a typical statute of limitations. We should
honor that choice by giving effect to the term “dispute” which qualifies the rest of the
language in the statute. The Court’s refusal to do so amounts to nothing less than a judicial
revision of § 39-71-520, MCA (1999).
¶81 When considered in the context of the Workers’ Compensation Act, particularly with
reference to the Act’s statute of limitations, it becomes abundantly clear that the legislature
did not intend that § 39-71-520, MCA (1999), operate as a typical statute of limitations. I
conclude that the Court’s statutory construction here is flawed because it makes § 39-71-520,
MCA (1999), and § 39-71-601(1), MCA (1999), operate in the same way despite their
substantial facial differences.
¶82 As we have previously stated:
Courts have developed many principles for interpreting statutes. Each
principle is designed to give effect to the legislative will, to avoid an absurd
result, to view the statute as a part of a whole statutory scheme and to forward
the purpose of that scheme.
Orr, ¶ 25. Here, the Court’s interpretation has undermined each one of these principles.
Disregarding the plain meaning of the term “dispute” thwarts the legislative will expressed
32
through the unique structure of this statute. Further, an absurd result obtains in that the UEF
is denied the opportunity to make a remedial calculation of benefits which it argues would
be proper, thereby denying a widow the full measure of the statutorily established death
benefit because of a mutual mistake of fact. Finally, the Court’s interpretation assigns
§ 39-71-520, MCA (1999), the same meaning as the general statute of limitations of the
Workers’ Compensation Act, ignoring the distinct nature of the two statutes and thereby
failing to view this statute as a part of a whole statutory scheme. In short, the rules of
statutory interpretation call for a different result than the Court has reached.
¶83 The Special Concurrence concludes that our decision in Hand v. Uninsured
Employers’ Fund, 2004 MT 336, 324 Mont. 196, 103 P.3d 994, is analogous to the present
case. Our resolution of that case was premised on § 39-72-612(1), MCA (1997). That
statute specifies a twenty-day time period in which a party may perfect an appeal. This time
period begins to run upon the existence of one condition: the issuance of an order of
determination regarding benefit entitlement. Section 39-72-612(1), MCA (1997), contains
no reference to the existence of a “dispute,” and is thus distinctly different from the statute
we consider here. Indeed, this argument typifies the sort of imprecise and scattershot
analysis employed by the Court itself. As such, reliance on the reasoning of Hand is
misplaced.
¶84 Finally, the Court’s resolution of this appeal is based in part on a mis-characterization
of Mrs. Forgey’s arguments. The Court states Mrs. Forgey has argued that she was relieved
of her statutory duty to cross-appeal the benefits calculation because Colmore timely
appealed the UEF’s decision to grant benefits. This theory is created out of thin air to bolster
33
a sought-for result. Neither Mrs. Forgey nor the UEF have made any argument remotely
similar to this. Nor have they even hinted at taking such a position. While I disagree with
the Court’s decision in this appeal, and while I disagree even more vigorously with the
manner in which the Court reaches its decision, I can not overstate my objection to this plain
mis-characterization of Mrs. Forgey’s arguments. It is simply wrong, and it deserves no
place in the Court’s Opinion.
Public Policy as a Guide for Interpretation
¶85 Not only has this Court misinterpreted § 39-71-520, MCA (1999), it has also ignored
the legislative mandate for the interpretation of such statutes and thereby contravened the
public policy of this State. The legislature has provided clear guidance to this Court
regarding the interpretation of the statute at issue:
39-71-105. Declaration of public policy. For the purposes of
interpreting and applying Title 39, chapters 71 and 72, the following is the
public policy of this state:
....
(3) Montana’s workers’ compensation and occupational disease
insurance systems are intended to be primarily self-administering. Claimants
should be able to speedily obtain benefits, and employers should be able to
provide coverage at reasonably constant rates. To meet these objectives, the
system must be designed to minimize reliance upon lawyers and the courts to
obtain benefits and interpret liabilities.
Section 39-71-105(3), MCA (1999) (emphasis added). In spite of the legislature’s clear
direction that our statutory interpretation should be guided by the principle of minimizing
reliance upon lawyers and the courts, this Court’s interpretation actually invites reliance
upon lawyers in the determination of proper benefits, and thereby ensures the involvement
of the courts. Clearly, the legislature did not intend that professional legal assistance, with
its attendant expense, should be necessary to the resolution of a benefits calculation. Yet,
34
under this Court’ Opinion, widows like Mrs. Forgey will either have to become proficient
in the fine points of benefit calculation, or employ professional legal assistance in order to
determine whether the UEF has rendered an accurate calculation, rather than depending on
the UEF to properly calculate benefits or at least make proper re-calculation when necessary.
¶86 Stated another way, the Court’s interpretation renders irrevocable a miscalculation
accomplished pursuant to a mutual mistake. This result demands that both claimants and
uninsured employers secure legal expertise to verify the UEF’s initial calculation, or risk
living under an erroneous decree. Yet, the statutory scheme does not indicate that such
mistakes must be blindly adhered to in perpetuity. As noted above, the plain meaning of
§ 39-71-520, MCA (1999), discloses nothing that bars a remedial adjustment of benefits in
cases where no dispute exists. Moreover, to allow for remedial adjustment is to minimize
the need for both claimants and uninsured employers to rely on professional legal assistance
in verifying the UEF’s initial calculation. This approach would honor Montana’s explicitly
stated public policy of minimizing reliance on lawyers so as to make the workers’
compensation system “primarily self-administering.” Section 39-71-105(3), MCA (1999).
¶87 In an apparent effort to pay tribute to the legislature’s guidance regarding our
statutory construction, the Court states that the UEF’s letter to Mrs. Forgey, which apprised
her of her benefit calculation, was “easily read by a layperson,” was written in “plain
English,” and was designed to inform her of her benefits “without the necessity of hiring a
lawyer.” Setting aside the vast differences in education, literacy, reading comprehension,
35
and sophistication2 that characterize our citizenry, these speculative conclusions are not at
all relevant to the legislature’s directions to this Court. It is our interpretation of statutes that
should minimize reliance upon lawyers, and our execution of that task is unrelated to the
quality of the UEF’s correspondence with claimants. Moreover, it is poor precedent to even
suggest that the language chosen by bureaucrats in correspondence can effectively amend
clear and unambiguous statutory language chosen by the legislature.
¶88 From the remoteness and safety of our chambers, and with the benefit of hindsight,
the Court deftly pinpoints the error of the UEF’s calculation. The Court then proceeds to
conclude that Mrs. Forgey could have easily done the same. The Special Concurrence goes
so far as to assert that even the “numerically challenged” could have readily detected the
error. Obviously the concurring Justice’s problems with mathematics are completely
irrelevant. No doubt, though, her conclusion might well be different if she, as a blue-collar
widow, had to detect the error while grieving the death of her blue-collar husband during the
process of applying for meager benefits to help feed her two children.
¶89 Additionally, the Special Concurrence asserts that the UEF’s letter of determination
“set forth precisely how the calculation was performed.” In fact, the UEF’s explanation was
anything but precise. The last step of the calculation explained in the letter contains a
two-thirds multiplier which reduced the average weekly wage figure and, in turn, reduced
Mrs. Forgey’s overall benefit. The letter includes no explanation for this significant
reduction. Rather, the calculation is surrounded by references to more than half a dozen
2
Mrs. Forgey did not have a college education, any legal training, or any judicial
experience. She graduated high school and worked as a house cleaner and a ranch hand.
36
workers’ compensation statues, leaving the reader to engage in relatively sophisticated legal
analysis in order to decipher the UEF’s calculation. Thus, in justifying the conclusion that
virtually anyone could have easily detected the UEF’s calculation error, the Special
Concurrence has improperly minimized the nature of the problem Mrs. Forgey faced.
¶90 It is this kind of approach which engenders the sentiment that appellate judges reside
in ivory towers, rendering opinions without due regard for the realities facing ordinary
citizens. Moreover, the contention that Mrs. Forgey could have deciphered the UEF’s
calculation in the exercise of “ordinary diligence” rings hollow, given that the Court’s initial
draft of its Opinion contained glaring errors which demonstrated a fundamental
misunderstanding of the calculation.
¶91 Finally, the Special Concurrence bases part of its reasoning on the demonstrably false
assertion that Mrs. Forgey “competently and correctly filled out the simple UEF claim
form.” Upon this assertion, the Special Concurrence posits that Mrs. Forgey could have
“just as easily and competently” recognized the UEF’s mistake. In fact, however, Mrs.
Forgey failed to specify the date Mr. Forgey was hired. As the UEF stated in a brief to the
Workers’ Compensation Court, it was precisely this failure which resulted in the UEF’s
miscalculation.
“Ordinary Diligence”
¶92 The Court declares that Mrs. Forgey should have discovered the UEF’s miscalculation
in the exercise of “ordinary diligence.” In doing so, the Court refers to the rule that a statute
of limitations for actions based on mistake begins to run when the facts are such that the
party seeking relief would have discovered the mistake in the exercise of ordinary diligence.
37
This rule is wholly irrelevant because we are not dealing with a statute of limitations for
actions based on a mistake. Rather, we are dealing with a statute that explicitly designates
the existence of a “dispute” as a prerequisite condition for the running of the time period for
appeal. Therefore, the “ordinary diligence” standard has no bearing on the case at bar.
The “Right” to Rely
¶93 Before Mr. Forgey’s death, Colmore failed to secure workers’ compensation
insurance, and thereby failed to comply with the legal requirement designed to protect
families like the Forgeys in case of an untimely death of the household breadwinner. Now
that he has been called to account for this failure, Colmore attempts to avoid the full
responsibility that attends such disregard for the law. In doing so, he offers a statutory
interpretation that distorts the law at issue and effectively contravenes the stated public
policy underlying the Workers’ Compensation Act--that wage-loss benefits should “bear a
reasonable relationship to actual wages lost as a result of a work-related injury or disease.”
Section 39-71-105(1), MCA (1999).
¶94 In accommodating Colmore’s effort to avoid full responsibility for his disregard of
the law, the Court declares that Colmore “had the right to rely on the amount fixed” by the
UEF. The Court cites no authority for this bare assertion, because none exists. The Court
has simply concocted a “right” to rely on the UEF’s miscalculation, without providing a
supporting analysis and without reference to a single legal authority. Consequently, this new
“right” appears to have been created solely for the purpose of resolving this appeal in favor
of the uninsured employer. Obviously, Colmore had no legal right to rely on the
miscalculation which denied Mrs. Forgey her proper benefits. He had no more right to rely
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on that miscalculation than he had a right to employ Mr. Forgey without securing workers’
compensation insurance coverage. Simply put, there is no injustice in requiring Colmore to
pay the undisputedly correct amount of death benefits. The true injustice lies in denying a
widow her statutory death benefits based on a vague notion of reliance which is unsupported
by a single reference to legal authority.
¶95 The Court apparently feels no obligation to account in any way for its nonchalant
creation of this “right.” One wonders: does this “right” emanate from a statute or from a
constitution? Or does this “right” have its basis in equitable considerations? If so, why does
the Court feel compelled to bestow such privilege upon an uninsured employer in the name
of equity, without bothering to mention the equitable concerns inherent in denying the
statutorily established measure of death benefits to a widow with two children? Or, may we
ask, what principle of equity is served by reducing Mrs. Forgey’s death benefits so as to add
to Colmore’s six-figure tax deduction?
¶96 As the Court has not seen fit to disclose the basis for this “right,” it shall apparently
remain a mystery to courts and practitioners alike. This Court is remiss in its duty when it
resorts to cavalierly creating rights out of whole cloth without reference to one shred of legal
precedent. In this case, the Court’s impulsive creation of a “right” has allowed the uninsured
employer to evade the hand of justice, and thereby reap a windfall at the expense of Mrs.
Forgey and her two children.
Distinguishing Precedent
¶97 The rule established in Joseph Eve & Co. v. Allen (1997), 284 Mont. 511, 945 P.2d
897--a case of first impression, incidentally--involved a procedural background and an issue
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wholly dissimilar to the one at bar. In Joseph Eve & Co., the respondent, Allen, moved to
dismiss an appeal on the ground that the lower court’s judgment was not final. Joseph Eve
& Co., 284 Mont. at 512, 945 P.2d at 897. We denied the motion, and two days later Allen
filed her motion for leave to file a cross-appeal with this Court. Joseph Eve & Co., 284
Mont. at 512, 945 P.2d at 897. By then the fourteen-day time limit in which to file a
cross-appeal had expired. Joseph Eve & Co., 284 Mont. at 512, 945 P.2d at 897-98. In
Joseph Eve & Co., there was an issue of law from which to cross-appeal--the finality of the
trial court’s judgment. There was a “dispute.” In the case sub judice there was no issue of
law from which to cross-appeal, only a mutual mistake of fact, acknowledged by all parties,
that was just as capable of ministerial correction as it had been made, ministerially, in the
first place. The Court’s conclusion to the contrary, Mrs. Forgey had no “duty” to appeal
until she had a “dispute” with the UEF’s decision.
Conclusion
¶98 As noted above, § 39-71-105(1), MCA (1999), provides that the objective of the
workers’ compensation system is to provide wage loss benefits that bear a reasonable
relationship to actual wages lost as a result of a work-related injury. Under the law, Mrs.
Forgey was and is entitled to benefits based on an average weekly wage of $443.00. In its
decision here, the Court has handed the uninsured employer a windfall, denied a widow the
benefits to which she is entitled under the law, and, in misapplying the law, has frustrated
the public policy of this State as articulated by the legislature. This is accomplished in part
by the use of a newly created “right to rely” on UEF miscalculations which is unsupported
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by legal precedent, a wholly irrelevant “ordinary diligence” standard, and a plain
misrepresentation of Mrs. Forgey’s argument on appeal.
¶99 I dissent.
/S/ JAMES C. NELSON
Justice Patricia O. Cotter joins in the concurrence and dissent of Justice James C. Nelson.
/S/ PATRICIA O. COTTER
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Justice Morris concurs and dissents.
¶100 I concur with our decision as to Issue One and dissent to our resolution of Issue Two
for the following reasons. I would affirm the Workers’ Compensation Court as to both
issues.
¶101 The Court’s opinion today fails to give proper effect to legislative will, culminates in
an absurd result, and deprives the statutory scheme of its intended purpose. State v. Heath,
2004 MT 126, ¶ 24, 321 Mont. 280, ¶ 24, 90 P.3d 426, ¶ 24. The Court’s interpretation of
§ 39-71-520, MCA (1999), disregards the plain meaning of the term “dispute” and further
frustrates the legislative purpose that permits the parties to appeal a contention regarding
benefits. Weber v. Interbel Telephone Co-Op., Inc., 2003 MT 320, ¶ 10, 318 Mont. 295, ¶
10, 80 P.3d 88, ¶ 10 (construing statutory language according to its plain meaning and giving
effect to the legislative intent from the text of the statute). The Court’s opinion also harvests
an absurd result where UEF remains unable to make a remedial calculation to its own
benefits computation and thereby denies the beneficiary the full extent of the statutorily
enumerated benefits. Finally, the Court’s decision defeats the intended purpose of § 39-71-
105, MCA (1999), to diminish a claimant’s reliance upon lawyers and expeditiously obtain
benefits for him or herself. Section 39-71-105(3), MCA (1999).
¶102 I respectfully dissent from the Court’s resolution of Issue Two.
/S/ BRIAN MORRIS
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