No. 85-370
IN THE SUPREME COURT OF THE STATE OF MONTANA
1986
WILLIAM STELLING, JR.,
Claimant and Appellant,
RIVERCREST RANCHES, INC.,
Employer,
and
STATE COMPENSATION INSURANCE FUND,
Defendant and Respondent and
Cross-Appellant.
APPEAL FROM: The Workers' Compensation Court, The Honorable
Timothy Reardon, Judge presiding.
COUNSEL OF RECORD:
For Appellant:
Lloyd E. Hartford argued, Billings, Montana
For Respondent:
Hughes, Alke, Kellner & Sullivan; Mike McCarter argued,
Helena, Montana
For Amicus Curiae:
Milodragovich, Dale & Dye; Lon J. Dale argued for
Gary Larson, Missoula, Montana
Rossbach & Whiston; John Whiston argued for Rubye
Kauffman, Missoula, Montana
Submitted: July 24, 1986
Decided: December 1 2 , 1986
Filed:
Clerk
Mr. Justice Frank B. Morrison, Jr. delivered the Opinion of
the Court.
Claimant, William Stelling, Jr., appeals the June 27,
1985, judgment of the Workers' Compensation Court which
awarded him only a small portion of the lump-sum advance he
had requested. We affirm the lump-sum advance and dismiss
the remainder of Stelling's appeal for lack of standing.
Stelling was injured January 5, 1981, in the scope and
course of his employment with Rivercrest Ranches, Inc. He
continued to work through June 8, 1981, entered the hospital
June 10, 1981, and underwent back surgery June 15, 1981. A
second operation was performed November 1, 1982.
The State Compensation Insurance Fund commenced paying
Stelling workers' compensation benefits June 9, 1981. It
also paid all of his related medical expenses. Thereafter,
the Fund requested permission to relieve itself of liability
by purchasing an annuity to provide Stelling with the
expected benefits to which he would be entitled.
On December 6, 1984, Stelling filed a petition for
hearing with the Workers' Compensation Court, asking that the
Fund's request be denied and that he be awarded a substantial
lump-sum advance. A pre-trial conference was held February
15, 1985. The hearing was held March 20, 1985. After the
taking of a post-trial deposition and the filing of briefs by
all parties, the matter was submitted to the Workers'
Compensation Judge on May 31, 1985.
Meanwhile, on April 15, 1985, the Montana Legislature
enacted Senate Bill 281 in response to this Court's decision
in Willis v. Long Construction Co. (Mont. 1984), 690 P.2d
434, 41 St.Rep. 2050. Willis forbid discounting to present
value lump-sum awards to workers' compensation claimants.
The bill amended 5 39-71-741, MCA, by (1) creating new
criteria for establishing the need for a lump-sum award; and
(2) requiring that lump-sum payments of permanent total
disability benefits be discounted at 7% for each year of the
estimated compensation period.
Thereafter, with the permission of the Workers'
Compensation Judge, Stelling amended his pre-trial order to
include Contract Clause, due process and equal protection
challenges to the application of S.B. 281 to his case.
Findings of fact, conclusions of law and a judgment were
entered June 27, 1985, finding claimant to be permanently
totally disabled and entitled to $219 in weekly benefits and
a partial lump-sum payment sufficient to satisfy the balance
due on his 1984 pickup truck. The judge denied claimant's
request for a lump-sum award sufficient to purchase an
annuity paying $1297 a month for twenty years and to purchase
a $65,000 house and $12,000 in furnishings. The Workers'
Compensation Judge also held constitutional retroactive
application of that portion of S.B. 281 establishing
procedures for proving entitlement to a lump-sum payment.
However, he found retroactive application of the discounting
provision to be unconstitutional.
Stelling challenges the constitutionality of S.B. 281
again on appeal and raises the following issues:
1. Whether the application of 39-71-741, MCA, as
amended by Ch. 471, Laws of Montana (1985), in the
determination of workers' compensation benefits to be awarded
to workers injured before April 15, 1985, (the effective date
of the amendment):
A. violates the Contract Clauses found in art. 1, S 10
of the United States Constitution and art. 11, § 31 of the
1972 Montana Constitution?
B. denies due process guaranteed by the Fourteenth
Amendment to the United States Constitution and by art. 11,
§ 17 of the 1972 Montana Constitution?
C. denies equal protection of the laws guaranteed by
the Fourteenth Amendment to the United States Constitution
and by art. 11, S 4 of the 1972 Montana. Constitution?
2. Whether, under the test in effect at the time of his
injuries - best interests of the claimant, Stelling is
entitled to the conversion of his biweekly benefits to a
lump-sum payment?
The State Fund cross-appeals, raising the following
issue:
1. Whether the Workers' Compensation Judge erred in
refusing to retroactively apply that portion of S.B. 281
requiring that lump-sum payments to permanently totally
disabled claimants be discounted to present value?
The issue raised on cross-appeal is addressed in another
case decided this same day, Buckman v. Montana Deaconess
Hospital, Slip Opinion #85-530, the case with which this case
was consolidated for oral argument.
In Buckman, supra, we held that the procedures of
S.B. 281 merely expand the methods by which a claimant proves
entitlement to a lump-sum award. The threshold test remains
that of the best interests of the claimant. Here, the
Workers' Compensation Judge held that Stelling failed to
prove that a lump-sum award would be in his best interests.
... Claimant has requested a sum to purchase an
annuity which will pay him a sum certain for the
rest of his life. An annuity purchase does not
rise to the standard of best interests ...
... Under case law precedent claimant is equally
unsuccessful in demonstrating that it is in his
best interests that he be awarded a sum sufficient
to purchase a home . . . Claimant has established
that his current housing situation, in the back of
his pickup, is intolerable. This alone does not
establish that the cash purchase of a home is in
his best interests. Claimant offered no evidence
establishing an inability to live on his biweekly
benefits in the rental market in Missoula. The
file is equally bereft of other financing options
for claimant's proposed home purchase other than
cash. Claimant has not demonstrated that the cash
purchase of a home with new furnishings is in his
best interests.
Claimant has established that his monthly truck
payment is a significant drain on his budget.
Claimant is awarded a lump sum sufficient to pay
off the balance due on his 1984 pickup. This will
decrease his monthly expenses and allow him to
obtain decent housing.
Judgment, p. 27.
Because the trial judge failed. to find that Stelling's
best interests would be met by conversion of his biweekly
benefits to a lump-sum payment, Stelling lacks standing to
contest the constitutionality of S.B. 281 and S 39-71-741,
MCA .
Standing of parties to bring their claims is a
threshold question a court must face before
reaching the substantive issues of a case.
Traditionally, courts require that a plaintiff have
a. "personal stake" in the outcome of a case, "to
assure that concrete adverseness which sharpens the
presentation of issues upon which the court so
largely depends for illumination of difficult
constitutional questions." Baker v. Carr, 369 U.S.
186, 204, 82 S.Ct. 691, 703, 7 L.Ed.2d 663 (1962).
Stoianoff v. State of Montana (9th Cir. 1983), 695 F.2d 1214,
1223. If Stelling is not entitled to a lump-sum at all, then
he cannot challenge the constitutionality of the methodology
computation.
There is substantial credible evidence to support the
trial judge's determination that the purchase of a home is
not sufficient basis for awarding a lump-sum to this
claimant. As noted in the trial judge's opinion, once
Stelling is no longer making truck payments, he will have
more money with which to provide himself housing. In
addition, there is no evidence that Stelling is unable to
live within Missoula's rental market.
The lower court judgment is af
We concur:
/
Mr. Justice L. C. Gulbrandson, dissenting.
I respectfully dissent to that portion of the majority
opinion affirming the Workers' Compensation Court's
determination that retroactive application of the discounting
provisions of § 39-71-741, MCA, is unconstitutional.
I have set forth the basis for this dissent in my
dissent filed in Buckman v. Montana Deaconess Hospital and
State Compensation Insurance Fund, filed simultaneously with
this opinion.
Mr. Chief Justice J. A. Turnage:
I concur in the dissent of Mr. Justice Gulbrandson.