No. 8 6 - 3 3 8
IN THE SUPREME COURT OF THE STATE OF MONTANA
1987
WILLIAM PERRY,
Claimant and Respondent,
-vs-
TOMAHAWK TRANSPORTATION, Employer,
and
ROCKWOOD SERVICES, INC.,
Defendants and Appellants.
and
TRAVELERS INSURANCE COMPANY,
Defendant and Respondent.
APPEAL FROM: The Workers' Compensation Court, The Honorable
Timothy Reardon, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Anderson, Brown, Gerbase, Cebull & Jones; Stephen J.
Harman, Billings, Montana
For Respondent:
Kelly & Halverson, P.C., William T. Kelly, Billings,
Montana (Perry)
Marra, Wenz, Johnson & Hopkins; Dan L. Spoon, Great
Falls, Montana (Travelers Ins)
Submitted on Briefs: Dec. 4, 1 9 8 6
~ecided: APR 7 - 1987
Filed: -
APR 7 1987
Mr. Justice L. C. Gulbrandson delivered the Opinion of the
Court.
Tomahawk Transportation (the employer and hereinafter
referred to as Tomahawk) and Rockwood Services, Inc. (the
insurer and hereinafter referred to as Rockwood) appeal a
Workers' Compensation Court order which (1) holds Rockwood
liable for a work-related injury to claimant William Perry
and (2) imposes a 20% penalty upon Rockwood for unreasonable
denial or delay of benefits. The issues on appeal are
(1) whether the court properly held Rockwood liable for
claimant's left arm injury, and (2) whether the court
properly imposed a 20% penalty upon temporary total benefits
paid by Rockwood pursuant to an interim court order and prior
to the court's final judgment. We affirm in part and reverse
in part.
The point of contention in the instant case is which of
Tomahawk's insurers is liable for claimant's left arm injury.
It is undisputed that claimant suffered two compensable
work-related injuries. While working for Tomahawk in May
1984, claimant suffered an injury to his left arm. At that
time, respondent Travelers Insurance Company (Travelers) was
the workers1 compensation insurer for Tomahawk and Travelers
accepted liability for the injury. In September 1984, again
while working for Tomahawk, claimant was injured when the
wind blew the truck he was driving over onto its side. The
truck landed on the driver's side causing a blow to the left
side of claimant's body. Rockwood was Tomahawk's workers'
compensation insurer at the time of this second accident.
Claimant alleges, and the lower court found, that the
September 1984 accident aggravated the injury to claimant's
left arm.
Rockwood voluntarily paid temporary total disability
benefits to claimant from September 1984 until approximately
six months later. On March 27, 1985, Rockwood terminated the
disability payments to claimant. On May 8, 1985, the
Workers1 Compensation Court ordered Rockwood to pay interim
benefits to claimant pending resolution of the question of
which insurer was liable for claimant's left arm injury.
Rockwood made those payments up until the court's June 1986
final judgment and apparently still continues to pay claimant
temporary total disability benefits.
In March 1985, claimant filed a petition for hearing
with the Workers' Compensation Court to resolve several
disputes he had with Rockwood. Rockwood moved to join
Travelers as a third party, which motion was granted. In
June 1986, the court filed its final judgment in the case.
The court held that Rockwood was liable for claimant's left
arm injury and imposed a 20% penalty on all temporary total
benefits claimant was entitled to from March 27, 1985, the
date that Rockwood temporarily terminated the benefits, until
the date of the judgment. This appeal followed.
To escape liability for the left arm injury, Rockwood
had to prove by a preponderance of the evidence that the
second injury did not aggravate the preexisting left arm
condition and/or that claimant's left arm had not reached a
medically stable condition prior to the second injury.
Belton v. Carlson Transport (1983), 202 Mont. 384, 658 P.2d
405. Rockwood had the burden of proof under Belton, 658 P.2d
at 409, 410, wherein we stated,
[Tlhe burden of proof is properly placed
on the insurance company which is on risk
at the time of the accident in which a
compensable injury is claimed.
The lower court found that the second injury did aggravate
the preexisting left arm condition and that Rockwood failed
to prove by a preponderance of the evidence that claimant's
left arm had not reached a medically stable condition.
Therefore, the court held Rockwood liable for the left arm
injury. Rockwood attacks both the above findings.
The standard of review is well settled.
"Our function in reviewing a decision of
the Workers' Compensation Court is to
determine whether there is substantial
evidence to support the findings and
conclusions of that Court. We cannot
substitute our judgment for that of the
trial court as to the weight of the
evidence on questions of fact. Where
there is substantial evidence to support
the findings of the Workers' Compensation
Court, this Court cannot overturn the
decision." (Citing cases.)
Denend v. Bradford Roofing & Insulation (Mont. 1985), 710
P.2d 61, 63, 42 St.Rep. 1778, 1780. Rockwood, citing Jones
v. St. Regis Paper Co. (1981), 196 Mont. 138, 639 P.2d 1140,
argues that this Court can determine what weight to assign
the testimony because much of the testimony was submitted by
way of deposition. We decline to do so since the court
specifically relied upon a substantial amount of live
testimony as critical evidence.
We find that there is substantial credible evidence to
support the lower court's finding that the September 1984
accident did aggravate claimant's left arm injury. Dr. Gary
Ray, who had treated or examined claimant numerous times over
several years, testified repeatedly and unequivocally that
the September 1984 accident aggravated the condition. We do
not agree with Rockwood's characterization of Dr. Ray's
testimony as incredible and unbelievable. Dr. Ray testified,
and the record demonstrates, that he was quite familiar with
both of claimant's accidents and the resulting problems.
Moreover, claimant also testified that his left arm was
substantially worse after the September 1 9 8 4 accident.
Therefore, we uphold the court's finding on this point.
Further, we uphold the court's determination that
Rockwood did not prove by a preponderance of the evidence
that claimant's left arm had not reached a medically stable
condition prior to the September 1 9 8 4 accident. We agree
that the evidence on this point was simply inconclusive.
Claimant testified that prior to the September 1 9 8 4 accident
he could tolerate his left arm condition and continue with
his job. He also testified that his left arm was not
improving prior to that accident. Dr. Frankel, who treated
claimant over a substantial period of time, was asked in
deposition how long he would expect claimant's healing period
to be after the May 1 9 8 4 accident. He replied that the
injury "may have quieted down in a week, and it may have
taken two or three years. There is just no way to answer
that question." Dr. Frankel also testified that he would
defer to the claimant's statements on whether the second
accident aggravated the left arm injury. We find credible
evidence tending to show that claimant had reached a
medically stable position. We also find credible evidence
that it was impossible to tell in this particular case, given
the peculiar circumstances of the injury and the timing of
claimant's medical examinations, whether claimant had reached
a medically stable condition. Thus, we sustain the ruling
that Rockwood did not carry its burden of proving that
claimant had - reached a medically stable condition.
not
The second issue is whether the lower court properly
imposed the 20% penalty for insurer unreasonableness upon
benefits paid by Rockwood. Only part of the 20% penalty
imposed on Rockwood is at issue. On March 27, 1985, Rockwood
terminated the temporary total disability benefits being made
to claimant. Rockwood began making the payments again on
about May 8, 1985, pursuant to a court order directing them
to do so. Rockwood does not appeal the 20% penalty as it is
imposed upon the benefits later awarded for this six week
period from March 27, 1985 to May 8, 1985.
Rockwood paid temporary total disability benefits to
claimant from May 8, 1985, until the lower court's final
judgment in June 1986. The court also imposed the 20%
penalty upon the benefits paid during this period. Rockwood
argues that the Montana statute governing the 20% penalty,
S 39-71-2907, MCA, does not authorize the imposition of the
penalty in this situation. Section 39-71-2907, MCA, provides
in part:
When payment of compensation has been
unreasonably delayed or refused by an
insurer, either prior or subsequent to
the issuance of an order by the workers'
compensation judge granting a claimant
compensation benefits, the full amount of
the compensation benefits - a claimant,
due
between the time compensation benefits
were delayed or refused and the date of
the order granting a claimant
compensation benefits, may be increased
by the workers' compensation judge by
20%. (Emphasis added.)
Those benefits which Rockwood paid from May 1985 until the
final judgment in June 1986 were not - at the time
due the
court imposed the penalty. The statute clearly allows the
imposition of the penalty only upon those benefits which are
due, that is, owed and payable. Therefore, the court
erroneously imposed the penalty on those benefits already
paid.
Remanded for entry of
opinion.
t
We concur: ~ 9 '
Justices
Justice John C. Sheehy did not pa.rt.icipate in this
decision, deeming himself disqualified.