No. 84-112
IN THE SUPREME COURT OF THE STATE OF MONTANA
1984
MATTHEW I. GRIMSHAW,
Claimant and Respondent,
L. PETER LARSON COMPANY,
Employer and Appellant,
and
L. PETERSON LARSON COMPANY,
Defendant and Appellant.
APPEAL FROM: The \Jorkersl Compensation Court, The Honorable
Timothy Reardon, Judge presiding.
COUUSEL OF RECORD:
For Appellant:
Garlington, Lohn & Robinson; Robert E. Sheridan
argued, Missoula, Montana
For Respondent:
Monte Beck argued, Bozeman, Montana
Submitted: September 24, 1984
Decided: November 15, 1984
Filed: Bey 1 5 1984
Clerk
Mr. Justice L. C . Gulbrandson delivered the Opinion of the
Court.
This is an appeal from an order of the Workers'
Compensation Court. The court ordered that claimant's
permanent total disability benefits and permanent partial
disability benefits were to be paid concurrently. The court
also allowed the conversion of the permanent partial benefit
to a lump sum. We reverse the order requiring the payment
of concurrent benefits.
The claimant, Matthew I. Grimshaw, was injured on
September 11, 1980, while in the scope and course of his
employment for the L. Peter Larson Company, a self-insured
employer under Plan I of the Montana Workers' Compensation
Act. Claimant injured his back when the logging tractor he
was operating fell into a three to four foot hole. At the
time of his injury, claimant was twenty-five years old,
married, and with two dependent children.
L. Peter Larson Company accepted liability for the
injury and began paying the claimant total disability
benefits. His total disability rate is $219 per week.
After examining the claimant in September, 1982, Dr. Carl
Albertson of Plains, Montana, concluded that he had an 18%
impairment of the whole man as a result of his injury. He
also concluded that claimant was unable to return to his
former occupation to do manual labor, and recommended that
he consider training for a less strenuous job.
Claimant developed a rehabilitation plan which was
accepted by the Rehabilitation Services Division, and
enrolled in the mechanical engineering program at Montana
State University. Under that plan, in addition to his other
benefits, he is receiving reimbursement for his tuition and
a monthly expense payment of $75. On October 8, 1982, after
claimant had started school, the employer wrote to him
stating that, since his condition had stabilized, his
benefits were to be reduced to $109.50 per week for ninety
weeks, the 18% partial disability rate. The letter made no
mention of the rehabilitation benefits. Claimant then
retained counsel, who requested that the employer reinstate
total disability benefits, and also demanded that employer
pay claimant's impairment claim. Employer reinstated the
total disability amount, but contested its obligation to pay
any impairment claim.
The Workers' Compensation Court ruled that the
claimant was entitled to receive benefits based on his
undisputed impairment rating while concurrently receiving
the permanent total disabilty benefits during his vocational
re-training. The court also required employer to pay a
portion of the partial disability award in a lump sum.
The following issues are raised on appeal:
(1) Does Holton v. F. H. Stolze (1981), 195 Mont. 263,
637 P.2d 10, give rise to an impairment claim that is not a
class as contemplated by section 39-71-737, MCA?
(2) Does Part 10 of the Workers' Compensation Act give
rise to a separate rehabilitation benefit that is not a
class as contemplated by section 39-71-737, MCA?
(3) Did the Workers' Compensation Court err in
awarding part of the partial disability payments in a lump
sum?
(4) Should appellant-employer be required to pay the
20% penalty as provided for in section 39-71-2907, MCA, for
dilatory payment of workers' compensation benefits?
The Workers' Compensation Court required the employer
to pay permanent total disablity benefits (for
rehabilitation) and permanent partial disability benefits
concurrently to the claimant. The primary hurdle that must
be cleared in order to uphold the order of the Worker's
Compensation Court is section 39-71-737, MCA. It simply
states that: "Compensation shall run consecutively and not
concurrently, and payment shall not be made for two classes
of disability over the same period." It should be noted at
this point that the employer concedes that it will have to
pay claimant some amount for his partial disability, but
contends that it is not required to do this until after
claimant's permanent total period expires, citing 39-71-737,
MCA.
The only case that has construed 39-71-737, MCA, is
Dosen v. East Butte Copper Mining Co. (1927), 78 Mont. 579,
254 P. 880. There this Court held that "[tlhe 'classes'
mentioned in section 2919 [the predecessor to 39-71-7371 as
originally enacted . . . evidently refer to the four
disabilities," which are: "(1) [tlemporary total disability;
( 2 ) permanent total disability; (3) temporary partial
disability; (4) permanent partial disability." Of those
classes, "[tjhe compensation shall run consecutively, -
successively, the payments succeeding one another in regular
order." 78 Mont. at 601, 254 P. at 887. In Dosen, the
claimant argued that he was entitled to compensation for
permanent partial disability while he was receiving
temporary total benefits. This Court emphasized the
"successive" nature of the various classes in holding that
the claimant was not entitled to both at once. Tee also
McDanold v. B.N. Transport, Inc. (Mont. 1984), 679 P.2d
1-188, 41 St.Rep. 472. (Temporary total disability benefits
are for the healing process, and only when that process is
complete is the claimant entitled to another class of
compensation.)
The language of 39-71-737, MCA, has remained unaltered
throughout the history of the Montana Workers' Compensation
Act. Originally it was contained in a section that dealt
primarily with payments made to deceased workers'
beneficiaries. That language has been recodified in section
39-71-723 and 724, MCA (1983). The "classes" that section
73'7's predecessors referred to have varied; from the medical
expense-wage loss scheme of the original act, to the present
wage loss-functional impairment scheme. The fact that the
Act has otherwise been amended so many times with the
section 737 language remaining intact leads strongly to the
conclusion that "classes" refers to all of the various
benefits provided by the Act that are not otherwise
specifically excepted.
Claimant mounts a two-prong defense of the Workers'
Compensation Court's order. Both arguments are to the same
effect; that one or the other of the payments ordered are
not classes within the contemplation of section 737.
The Workers' Compensation Court based its ruling on
this Court's decision in Holton v. F. H. Stolze (1981), 195
Mont. 263, 637 P.2d 10 as follows:
"The Court found the claimant had an
absolute entitlement to payment based on
the impairment rating ...
Although the
Court referred to the payment as a
payment of a 'disability' claim, the
holding, when read in context reveals
that the Court was in fact referring to
the payment of an 'impairment' claim
. .[T]he payment of an 'impairment' claim
is not a 'class of disability' for which
concurrent payment is prohibited by
section 39-71-737, MCA (1981)
separate and distinct from the other
...
It is
types of benefits to which an injured
worker [is] entitled." Grimshaw v.
Larson, Workers' Compensation Court
Docket No. 1959, decided February 4 ,
1984. (Citations omitted. )
'The Workers' Compensation Court misapplied and
misinterpreted Holton. In that case, the claimant was not
totally disabled, and was not receiving total disability
benefits at the time he requested partial disability
benefits. He had returned to work, and thus there was no
issue of concurrent payment of classes of compensation.
The lower court felt that Holton gave rise to a
so-called "indemnity benefit" as a new and wholly different
award under the Act. This is reading too much into Holton.
The language relied upon by the lower court came from the
part of the opinion that was discussing the 20% penalty.
Employer correctly points out the context of that language.
The claimant had an undisputed right to some amount of
temporary total disability benefits then and there, and the
issue was how much. The claimant in Holton had al.ready been
examined, and the insurer ha3 received a verification of the
claimant's physical impairment rating.
The impairment rating is the medical component of a
claimant's disability rating, which is a medical-legal
concept. See Robins v. Anaconda Aluminum Co. (1978), 175
Mont. 514, 575 P.2d 67; Grosfield, Montana Workers'
Compensation Manual, section 6.10. This Court in Holton
implicitly held that the impairment rating is the lowest
level the disability rating may reach, and when the legal
CORRECTION. In preparing this opinion for pub-
Hon. L. C. Gulbrandson lication, we noted in our verification of titles and
Justice, Supreme Court citations the matters listed below. Corrections have
Room 436 Justice Bldg. been made on our copy of the opinion.
215 North Sanders
Helena, Montana 59620
January 24, 1985
Grimshaw v. L. Peter Larson Co., No. 84-112, Nov. 15, 1984
Page 7, line 12 from bottom --- 268 N.W.2d - should read 268 N.W.2d
23
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28.
WEST PUBLISHING COMPANY
Box 43526
St. Paul, MN 55164
consequences of the impairment are ultimately known, the
disability rating may be greater. Jensen v. Zook Bros.
Const. Go. (1978), 178 Mont. 59, 582 P.2d 1191.
Holton did not address the issue of what to do with
the impairment claim when total disability benefits were
currently being paid. The context of the opinion, though,
suggests that physical impairment is a component of partial
disability benefits, and dependent thereupon for legal
efficacy. If the claimant is not presently entitled to
receive partial disability benefits, Holton does not apply.
Courts in a minority of states have upheld the
concurrent payment of permanent total and permanent partial
awards, "under the theory that the former is for loss of
earning capacity and the latter for physical impairment."
Larson, Workers' Compensation Law, section 57.14(f). This
trend was begun by the North Dakota court in Buechler v.
N.D. Workman's Comp. Bureau (N.D. 1974), 222 N.W.2d 858; and
Michigan, Redfern v. Sparks-Withington Co. (Mich. 1978), 268
N.W.2d
!S 35;
S, Kansas, Cody v. Jayhawk Pipeline Co. (Kan.
1977), 565 P.2d 264, 266; Minnesota, compare Pramschiefer v.
Windom Hospital (Minn. 1973), 211 N.W.2d 365 and Boquist v.
Dayton-Hudson Corporation (Minn. 1973), 209 N.W.2d 783, with
Minn. Stats. Ann. section 176.021 subd. 3 (1984); and
Hawaii, Cuarisma v. Urban Painters, Ltd. (Haw. 1979), 583
P. 2d 321, have followed suit. See also Larson, supra.
These states are still in the minority, and their situations
differ from Montana's in at least three respects: (1) a
reliance on explicit statutory language and history in
upholding concurrent benefits. See particularly, Cuarisma.
Montana does not have such a statutory scheme; (2) Montana
does not subscribe to exactly the same distinction (earning
capacity-physical impairment) between the types of benefits.
Here, partial benefits entail more than just physical
impairment, including also the loss of earning capacity; and
(3) none of these states have counterparts to section
39-71-737, MCA.
Alternatively, claimant argues that "rehabilitation
benefits" are not a "class" of benefits covered by
39-71-737, relying on language in section 39-71-1003: "The
eligibility of any worker to receive other benefits under
the Workers' Compensation Act is in no way affected by his
entrance upon a course of vocational rehabilitation ... "
Part 10 of the Act governs the rehabilitation program.
It allows the Division to make travel, living, tuition and
school related expense payments to qualified claimants. The
living expenses provided have a maximum of $ 5 Q per week.
These are the only payments specifically authorized by this
part of the Act.
Claimant's main argument is that rehabilitation
benefits serve a different purpose than the other benefits
provided by the Act, and stand on their own in Part 10. He
points out a previous Workers' Compensation Court ruling,
McKean v. Rosauer's, WCC Docket No. 881-186, decided March
31, 1982, where the court ruled that claimants undergoing
rehabilitation programs are entitled to permanent total
disability benefits for the reasonable duration of the
programs. He contends that what the Workers' Compensation
Court did in McKean was hold that the amount of
rehabilitation benefits should be determined by reference to
the permanent total rate.
The McKean court held:
"The issue presented here is one of the
basic, nagging problems which has not
been specifically addressed by the
Workers1 Compensation Act. It is
unfortunate that a fourth category of
disability benefits was not adopted to
provide for this situation where the
claimant cannot return to her previous
employment and must be retrained. ..
"This Court is of the opinion that the
claimant should be put on permanent total
disability benefits until her retraining
period is over. This option appears to
be the wiser course for several reasons.
First, a claimant whose physical
restrictions require vocational
rehabilitation better fits under the
definintion of permanent total disability
under section 39-71-116 (13) MCA. [It
provides: 1
"'(13) "Permanent total disability" means
a condition resulting from injury as
defined in this chapter that results in
the loss of actual earnings or earning
capability that exists af ter the injured
worker is as far restored as the
permanent character of the injuries will
-
permit and which results in the worker
having no reasonable prospect of finding
regular employment of any kind in -
-- --------- -the
normal labor market.'
"Clearly, the claimant here has no
reasonable prospect of finding a job in
the normal labor market when her physical
restrictions do not permit her to return
to her previous employments and she has
no other employment skills to offer a
prospective employer. Until claimant
acquires training for more sedentary
types of employment she is totally
disabled because she has no reasonable
prospect of finding regular employment of
any kind in the normal labor market."
(Emphasis in original.)
Clearly, the Workers' Compensation Court put the
claimant - permanent total disability benefits.
on Claimant,
Grimshaw, is already receiving tuition payments and $75 per
month for expenses under Part 10 of the Act. The permanent
total benefits stand on their own in Part 7.
Secondly, the words "other benefits" in section
39-71-1003, contradistinguish the rehabilitation program
payments from the other benefits provided by the Act. The
most reasonable construction of that statute is that it
specifically isolates the travel, tuition and living expense
payments under Part 10, from the limits in the other parts
of the Act.
This question is of first impression before this
Court, but a recent Kansas case, Cowan v. Josten's American
Yearbook Co. (Kan.App. 1983), 660 P.2d 78 dealt with a
similar situation. By Kansas law, rehabilitation benefits
are specifically designated temporary total benefits.
K.S.A. 44-510g(g). The claimant mounted a similar argument
there as here: that rehabilitation benefits, being based on
differing needs and purposes, should be considered separate
from, and should not count against, claimant's other
benefits. The court held that: "when a disability stems
from a scheduled injury, compensation paid during vocational
rehabilitation . . . is counted against, and is not
independent of, the total compensation due." 660 P.2d at
81. The Kansas court's holding was based on two grounds:
(1) the statutes specifically stated that payments during
rehabilitation programs were temporary total benefits, and
subject to the same treatment of those benefits in other
circumstances; and (2) that the legislature could have
easily provided that rehabilitation benefits were
specifically independent of all other benefits, but it did
I
not. This second factor was also recognized by the court in
McKean. Classifying rehabilitation benefits, other than
those specifically provided for in Part 10, as separate,
independent benefits, is best left to the legislature.
We hold that the concurrent payment of two classes of
benefits as ordered by the Workers' Compensation Court, is
prohibited by section 39-71-737, MCA. We recognize that we
are to construe the Workers' Compensation Act as liberally
as possible in the favor of the injured claimants. Section
39-71-104, MCA. But, this liberal construction does not
allow us to disregard the clear statutory provisions, State
ex re1 Magelo v. Industrial Accident Board (1936), 102 Mont.
455, 59 P.2d 785; Davis v. Industrial Accident Board (1932),
92 Mont. 503, 15 P.2d 919, or to use it to the point of
repealing or abrogating a statute. Klein v. In?. Wholesale
Associated Growers (1975), 167 Mont. 341, 538 P.2d 1358.
The effect of this decision is not to deny claimants
any benefits they are entitled to. We are simply holding
that 39-71-737, MCA applies to prevent the concurrent
payment of benefits provided under Part 7 of the Act, and
that the benefits provided under Part 10 are not affected.
In the case of Matthew Grimshaw, he is, and will be
entitled to total disability benefits during the reasonable
duration of his rehabilitation program. At the same time,
he will also be entitled to any rehabilitation benefits
awarded under Part 10 of the Act, and these benefits are
totally separate from, and not counted against his Part 7
benefits. When he has completed his rehabilitation program,
he will, at that time, be entitled to his partial disability
benefits. Under Holton, his 18% disability payments will be
due immediately. It may be that the effects of his injury
leave him disabled in the workplace to an extent greater
than his physical impairment level, in which case, the
Workers' Compensation Court will then set his final partial
disability rating. It is the employer's hope that, due to
his rehabilitation program, Matthew will suffer no greater
legal disability than the 18% physical impairment level. If
that is the case, employer is not obligated to pay anymore
than that, but the 18% amount must be paid regardless.
We reverse the order of the Workers' Compensation
Court, and remand for proceedings consistent with this
holding. Accordingly, we do not at this time reach the
issue of the lump sum payment.
Finally, as to respondent's request for the 20%
penalty, as provided for in section 39-71-2907, MCA, it is
apparent that Larson was not acting in an "unreasonable"
manner in witholding payment of the permanent partial
amount. There was, as evidenced by the foregoing
discussion, a bona fide legal dispute. Wight v. Hughes
Livestock Co., Inc. (Mont. 1981), 5 3 4 P.2d 1189, 38 St.Rep.
1632. The penalty is inappropriate in this case.
Reversed .
We concur:
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Chief Justice
Justices
Mr. Justice John C. Sheehy:
I concur in the result. --
f '
I