No. 80-455
I N T H E SUPREME COURT O F THE S T A T E O F MONTANA
1981
S T A T E O F MONTANA, e x r e l . , UNINSURED
EMPLOYERS' FUND, D I V I S I O N O F WORKERS'
COMPENSATION,
P e t i t i o n e r and A p p e l l a n t ,
THE HONORABLE W I L L I A M E . HUNT,
WORKERS' COMPENSATION J U D G E ,
Respondent.
O R I G I N A L PROCEEDING:
For A p p e l l a n t :
Hon. M i k e G r e e l y , A t t o r n e y G e n e r a l , H e l e n a , M o n t a n a
Roy Andes, A s s i s t a n t A t t o r n e y G e n e r a l , Helena, Montana
a
For R e s p o n d e n t :
Tim Reardon, Helena, Montana
DiiRDRf R a G G 5, Kl/ss~uiA, r f c N T ~ N 4
l
Submitted: March 16, 1981
Decided: M a r c h 20, 1981
Filed: MAR 2 0 1981
Clerk
Mr. Justice John C. Sheehy delivered the Opinion of the
Court.
Petitioner Uninsured Employers' Fund, a Division of Workers'
Compensation, State of Montana, filed its petition with this
Court for a writ of prohibition addressed to the Hon. William
E. Hunt, Workers' Compensation judge, upon the ground that
Judge Hunt had no jurisdiction to determine the dispute
hereafter described.
On receipt of the petition by the Fund for prohibition,
we entered an order on December 12, 1980, temporarily
restraining the Workers' Compensation Court from further
proceeding in the cause before it, and requiring an appear-
ance from the Workers' Compensation Court.
The response was filed on January 2, 1981. We determine
that the petition for a permanent writ of prohibition should
be denied.
Norman Beebe was injured in August 1979, while driving
a tractor-trailer owned by Walker Leasing, Inc. (hereafter
Walker). Walker had leased the tractor to Western Wheels, a
division of E. R. Murphy Trucking Company (hereafter Murphy).
Beebe filed a Workers' Compensation claim with the
Division of Workers' Compensation, Uninsured Employers'
Fund. Beebe's claim was accepted by the Fund and continuous
benefits have been paid to him. At the time of the petition,
$11,000 had been paid, and there is a potential total
liability of $30,000.
Because of the Fund's determination that Beebe was
Walker's employee, the Fund attempted to charge Walker the
amount of Beebe's benefits pursuant to section 39-71-504,
MCA. The Fund also attempted to charge Murphy with those
benefits, seeking to collect, in the alternative, from
either party involved in the use of the tractor-trailer.
Both parties denied any responsibility for the employ-
ment of Beebe.
Walker filed a petition which is presently pending in
the Workers' Compensation Court. That petition sought
declaratory relief that:
"1. Claimant was an independent contractor,
and not an employee of Walker.
"2. Claimant always was an employee of some-
one other than Walker.
"3. That claimant consented to be, and was hired
and transferred from the general service of
Walker to Western Wheels for a particular and
special service so as to become the employee
of Western Wheels, who controlled and directed
his driving with claimant's assent."
When Walker filed its petition in the office of the
Workers' Compensation Court, the Fund appeared therein by
filing a motion to dismiss, raising the question of juris-
diction of the court, and also filing an alternative motion
in case its jurisdictional argument was lost, that Murphy be
made a party to the proceedings.
On November 5, 1980', the Workers' Compensation Court
denied the motion of the Fund to dismiss the petition in his
Court and on November 14, 1980, issued an order granting the
motion to join Murphy as a necessary party before the Workers'
Compensation Court.
In the meantime, the Fund itself brought an action in
the Fourth Judicial District Court, Missoula County, as
plaintiff, naming Walker and Murphy as defendants, in which
complaint the Fund contends that Murphy or Walker was liable
for the amounts of money which the Fund has been required to
pay to Beebe. The Fund alleges that demand has been made
upon both parties, that both deny liability, and that the
relief, sought in the alternative, is a judgment against
Walker or against Murphy for the amounts paid or to be paid
to Beebe, and for the penalties prescribed by the Workers'
Compensation statutes against uninsured employers. That
action is pending with nothing further in our file respecting
progress in the District Court. Presumably it is awaiting
our decision as to the authority of the Workers' Compensation
Court to continue with the cause before it.
The contentions raised by the Fund are that:
1. The matter pending before the Workers' Compensation
Court is not a "dispute" under section 39-71-2905, MCA, and
that such dispute could only be with respect to benefits
payable.
2. The legislative history of the Workers' Compensation
Court shows that the office is only to be adjudicatory
regarding workers' claims.
3. The relief sought is declaratory in nature and
outside the power of the Workers' Compensation Court.
4. The Workers' Compensation Court is not a full-
blown District Court but an administrative law court with
limited jurisdiction.
In the pending action before the Workers' Compensation
Court, the respondents are Walker and Murphy, after the
latter had been made a party to the action. Beebe is not a
party under any motion or order made by the Workers' Compen-
sation Court. Yet the dispute involves the benefits payable
to Beebe, and if it is determined in either court that Beebe
was an independent contractor at the time of the accident,
his benefits would presumably be terminated. It therefore
appears to be a dispute that involves benefits payable to a
claimant.
Section 39-71-2905, MCA, provides as follows:
"A claimant - - insurer who -
or an - - has a dispute
concerning any benefits under chapter 71
a ..
- this title mav petition the wres
of - --- okr'
compensation judge - - a determination -
for of
the dispute. The judge, after a hearing,
shall make a determination of the dispute
in accordance with the law as set forth in
chapter 71 of this title. If the dispute
relates to benefits due a claimant under
chapter 71, the judge shall fix and determine
any benefits to be paid and specify the manner
of payment. - - workers' compensation judge
The
-
has exclusive jurisdiction - -
to make determinations
concerning disputes under chapter 71. The
penalties - assessments allowed G a i n s t a n
and
insurer under chapter - - -
71 are the exclusive-
penalties - assessments - -can be assessed
and that -
against an insurer - disputes arising under
for
-
chapter 71." (Emphasis added.)
The Workers' Compensation Court has handled cases not
strictly involving disputes between insurers and employees.
Little v. Structural Systems (1980), - Mont . -, 614 P.2d
516, 37 St.Rep. 1187, concerned liability between carriers;
Brandner v. Travelers Ins. Co. (1978), - Mont . -, 587
P.2d 933, 35 St.Rep. 1746, referred to subrogation; Hart1
v. Big Sky of Montana, Inc. (1978), 176 Mont. 540, 579 P.2d
1239, regarded apportionment between carriers; Vigue v. M
& M Const. Co. (1978), 175 Mont. 425, 574 P.2d 994, considered
extraterritorial coverage. In the recent case of Alaska
Pac. Assur. Co. v. L. H. C., Inc. (1981), Mont . I
622 P.2d 224, 37 St.Rep. 1616, we indicated in passing that
the Workers' Compensation Court operating as it does under
the Montana Administrative Procedure Act (section 39-71-
2903, MCA) has a limited right to issue declaratory rulings
(section 2-4-501, MCA) .
It seems clear therefore, that this is a dispute with
respect to the benefits payable to a claimant, and as such,
under section 39-71-2905, MCA, the Workers' Compensation
Court has exclusive jurisdiction. As the Workers' Compensation
Court points out in its response, we said in Sharp v. Hoerner
Waldorf Corp. (1978), - Mont . , 584 P.2d 1298, 35
St.Rep. 1430, that the criteria for finding liability under
a Workerst Compensation dispute in a case involving an
independent contractor may be different from other con-
tractual relationships. We said:
"It is therefore this Court's conclusion
the application of section 92-438.1,
R.C.M. 1947 [now section 39-71-120, MCA]
to the factual situation results in a
determination that appellant was in fact
subject to the control of Hoerner Waldorf
and thus is an employee for purposes of
the Workers' Compensation Act."
The legislative history relied upon by the Fund relates
to the Workers' Compensation scandals of a decade ago and
the subsequent establishment of the Workers' Compensation
Division. The Fund contends it was the intention of the
legislature in establishing the Workerst Compensation Court
to provide a forum for adjudicating workerst claims only.
However, the history of the court and the statute providing
exclusive jurisdiction in the court indicate that the
jurisdiction of the court goes beyond that minimum whenever
the dispute is related to benefits payable to a claimant.
As we have indicated above, the contention that the
Workers' Compensation Court has no declaratory power is not
in accord with the provisions of the statute nor the provisions
of the Montana Administrative Procedure Act.
Although the Workers' Compensation Court is not vested
with the full powers of a District Court, it nevertheless
has been given broad powers concerning benefits due and
payable to claimants under the Act. It has the power to
determine which of several parties is liable to pay the
Workers' Compensation benefits, or if subrogation is allowable,
what apportionment of liability may be made between insurers,
and o t h e r m a t t e r s t h a t go beyond t h e minimum d e t e r m i n a t i o n
o f t h e b e n e f i t s p a y a b l e t o an employee.
W e d e t e r m i n e t h a t t h e Workers' Compensation C o u r t
h a s e x c l u s i v e j u r i s d i c t i o n of t h i s c a u s e r e l a t i n g t o t h e
b e n e f i t s o f Beebe.
We, t h e r e f o r e , o r d e r t h a t t h e temporary p r o h i b i t o r y
o r d e r which w e e n t e r e d on December 1 2 , 1980, a g a i n s t t h e
Workerst Compensation C o u r t i s hereby v a c a t e d and it i s
f u r t h e r o r d e r e d t h a t t h i s c a u s e be remanded t o t h e Workers'
Compensation C o u r t f o r f u r t h e r p r o c e e d i n g s . The Worker's
Compensation C o u r t s h a l l d e t e r m i n e i f Beebe s h o u l d be made a
p a r t y t o t h e -proceedings i n t h a t court. A copy of t h i s
o p i n i o n and o r d e r , when s e r v e d by t h e C l e r k upon t h e p a r t i e s
by o r d i n a r y m a i l , s h a l l s e r v e t h e o f f i c e of a f o r m a l o r d e r .
The p e t i t i o n , i n t h i s c o u r t , o f t h e Fund i s d i s m i s s e d .
Justice 1
W e Concur:
Chsef J u s t i c e \
&" J u s t i c e s
-7-