No. 90-560
IN THE SUPREME COURT OF THE STATE OF MONTANA
1991
WAUSAU INSURANCE COMPANY,
Petitioner,
LLOYD E. HARTFORD,
Defendant and Respondent,
and CLERK OF SUPWEi$lE &OUR-j
STATE OF MDNTApdA
LAVERN GARMANN,
Defendant and Appellant.
APPEAL FROM: The Workers1 Compensation Court,
The Honorable Timothy Reardon, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
William J. OIConnor, 11, Billings, Montana
For Respondent:
Lloyd E. Hartford, Billings, Montana
L. Randall Bishop; Jarussi & Bishop, Billings,
Montana
Submitted on Briefs: February 21, 1991
Decided: April 29, 1991
Filed:
Justice William E. Hunt, Sr., delivered the opinion of the
Court.
The Workers1 Compensation Court ordered claimant Lavern
Garmann to honor his contingency fee agreement with counsel Lloyd
Hartford, and ordered that the contingent attorney fees were a lien
on the benefits paid by Wausau Insurance Company to Garmann.
Garmann appeals.
We affirm.
On June 27, 1983, Garmann entered into a contingency fee
agreement with attorney Hartford for workers1 compensation
benefits. The agreement provided that Hartford would receive 33
percent of the amount of compensation benefits awarded by the court
if the case went to a hearing.
Trial was held on February 4, 1985; by judgment in April 1986
claimant was declared permanently totally disabled; and Hartford
was awarded attorney fees calculated as provided for in 5 39-71-
614, MCA (1985). The court subsequently ordered the insurer to pay
Hartford a fee of $13,600, plus costs of $1,628.
Hartford then requested that Garmann pay attorney fees in the
amount of 33 percent of the award, pursuant to the contingency fee
agreement. Garmann refused, and instructed Wausau not to pay any
part of his weekly benefits to Hartford as fees.
Wausau then filed a petition with the Workers1 Compensation
Court seeking a declaratory ruling as to whether Garmann owed
Hartford attorney fees pursuant to the contingency fee agreement.
2
On October 19, 1990, the court ruled that the contingency fee
agreement executed by the parties was enforceable and ordered the
parties to arrange a convenient method to have the benefits and
fees distributed. This appeal followed.
Sections 39-71-611 and -612, MCA, permit the Workers1
Compensation Court to assess costs and fees directly against an
insurer. Section 39-71-614(3), MCA, permits claimant and attorney
to enter into a contingency fee arrangement. The contingency fee
is separate from amounts assessed by the court against the insurer:
(3) This section does not restrict a claimant and an
attorney from entering into a contingency fee arrangement
under which the attorney receives a percentage of the
amount of compensation payments received by the claimant
because of the efforts of the attorney. However, an
amount equal to any fee and costs assessed against an
insurer under 39-71-611 or 39-71-612 and this section
must be deducted from the fee an attorney is entitled to
from the claimant under a contingency fee arrangement.
Section 39-71-614(3), MCA.
However, the costs assessed by the court against the insurer
(in this case the $13,600 plus costs) shall be deducted from the
fee to which the attorney is entitled under the agreement. We hold
that the October 19, 1990, order of the Workers' Compensation Court
is a correct application of
5 39-71-614 (3), MCA.
Affirmed. Let remittitur issue forthwith. See Rules 34 and
Pursuant to 5 I, Par. 3 (c), Montana Supreme Court 1988
Internal Operating Rules, this decision shall not be cited as
precedent and shall be published by its filing as a public document
with the Clerk of the Supreme Court and by a report of its result
to West Publishing Company.
Justice
Chief Justice
Justices
4/
Wausau Insurance v. Hartford Garm
Combined Opinion