*1 SOLHEIM, Appellant, v. TOM DAVID D. RANCH, Employer, and STATE COMPENSA- DAVIS Respondent. FUND, Defendant TION INSURANCE No. 82-254. 10, Submitted Nov. 1983. Decided Feb.
J. Daniel respondent. for defendant and Opinion delivered
MR. JUSTICE WEBER Court. (Claimant) judgment appeals from the
David D. Solheim him finding ineligible Court Compensation of the Workers’ while un- injury sustained compensation following The Montana. hay Springs, near Sand loading a truck contrac- independent was an concluded that claimant Court Compensa- employee under the Workers’ tor rather than an tion Act. We affirm. issues are:
The erroneously Court Compensation 1. Whether the Workers’ was an concluded that claimant of the Work- meaning rather than an within Act? ers’ erred the Workers’ Whether automatically entitled was not
concluding that claimant deny his accept or failed to benefits because the insurer 39-71-606, required under Section within 30 claim relationship MCA, of an even in the absence the Act? under Ranch Tom Davis Davis of January Tom Augusta, near his ranch tons of from
agreed to sell 500 *4 Montana, Springs, Ranch near Sand Montana to the 7-W the hay. Because purchase the agreed to whose owner had Ranch the 7-W promptly and because hay was needed tons, all 500 delivery of hay upon pay for the agreed businesses, trucking approximately Tom Davis contacted hay including claimant, delivery in order to of the arrange possible. by as soon as The offer Tom Davis to made truckers, claimant, Pay- including per ton. pay $28 was to ment was to be to the all the was made truckers when paid by delivered and Tom Davis been 7-W when had All Ranch. of the contracted were to furnish their truckers truckers, own vehicles. including Davis advised the claim- ant, that Davis would have a stacker Freeman available trucks on load certain when of that week use stacker was not required otherwise on his feedlot a number of miles away. also Davis told the truckers there would help available at the 7-W un- Ranch to unload. Claimant derstood that the truckers would as help unloading general is the custom.
Claimant has run his own since He trucking business describes himself “independent as an his trucker” and files own income taxes a self-employed logo individual. The on his truck is Trucking.” pays “Solheim Claimant for insurance and on cargo licenses his truck. He carries insur- on ance his loads coverage and had effect during shipping hay. not generally Davis does pay work for hourly or weekly basis. Claimant works persons for other than Davis. 17, 1981, January
On approximately ten semi-trucks were loaded at the Davis Ranch use of Davis Freeman stacker. Claimant on January was unable to be there 17. On following day, January 18, claimant and two other truckers, McAdams, claimant’s father and Dick loaded their trucks at the for They Davis Ranch. used McAdams’ tractor loading because the Davis not stacker was available that day. Tom present Davis ten was about minutes pointed out the haystack from which bales were to He rough map showing way loaded. also drew a from Springs gave Sand to the Ranch. no instructions 7-W Davis as to the or the route to loading unloading of the trucks the 7-W Ranch. Davis testified if he were dissatisfied *5 right job, doing way had “a his he trucker was with the a correct the situation.” him about it and tell three their father, drove Claimant, and McAdams his together were directed Ranch and to the 7-W loaded trucks present unloading no one there was area. Because to the help they then first and them, McAdams’ truck unloaded point, Drew At this Solheim’s truck. on to the elder moved began with the to assist Ranch arrived and Burke of 7-W unloading. a Burke threw the stack when Claimant was on ground knocking with truck, claimant to bale from resulting hip femur. After and left to his left bone fracture by preliminary veterinarian, was claimant treatment hospitalization. brother Claimant’s Falls for flown Great transporting driving truck, from continued claimant’s tons entire 500 Ranch until the. the Davis Ranch to the 7-W hauling by for Da- truckers had been delivered the various payment by Immediately Ranch, Davis the 7-W vis. after payment paid The date claimant and all other truckers. injury. approximately the date one month after was 4, 1981, filed a claim for benefits June claimant On timely The claim was Division. the Workers’ 39-71-601(1), By pursuant letter ad- MCA. filed 1981, 17, claims ex- and dated June dressed to claimant Fund ac- Insurance for State aminer receipt knowledged claim for Solheim’s compensation compensation. That letter stated that before on medical evidence there must be benefits can be awarded been re- had file and that no medical information advised are, stated “We therefore ceived. The claims examiner any compensation this time.” therefore, at unable to award to claim- had been mailed The letter also said that a letter report. physician’s physician requesting ant’s receiving additional did submit denied the letter. Claimant information at a later date. medical petition July for an emer- 28, 1981, filed a On claimant hearing. dates, gency trial of trial After several vacations January Findings fact, 22, conclusions was held on by of law were entered judgment the defendants judg- June in its 1982. The Court concluded by ment as that claimant was not an defined Sec- 39-71-118(1)(a), MCA, tion but rather was an 39-71-120, defined MCA. The Court further concluded that claimant was not entitled to appeals benefits under the Act. Claimant from that judgment.
I *6 Did Compensation erroneously the Workers’ Court con- clude independent that claimant was an contractor rather than an under the Workers’ Act? mistakenly maintains Court the concluded he independent was an meaning contractor within 39-71-120, MCA, Section which states: “Independent ‘independent An con- defined. tractor’ is one in who renders service the course of an occu- pation (1) and: had been will and continue to be free from control or performance services, direction over the (2) both fact; under his contract in in and and an engaged independently trade, occupation, profession, established business.”
Claimant, defendants, and the Workers’ Court agree leading independent Montana case on v. Sharp Hoerner (1978), Corp. contractors is 178 Waldorf 419, Sharp, Mont. 584 adopted P.2d 1298. In this Court “four-factor for right test” of control set forth Lar Compensation Law, Workmen’s son’s 1C, Vol. 44.00, p. 8-31. We stated:
“Larson’s treatise enumerates four factors to consider when attempting to determine in a right given of control (1) situation. Those right factors are: direct evidence of (2) (3) control; exercise of payment; furnishing method of Larson, (4) 44.31, equipment; p. 8- right and to fire. 35. points The treatise further out that consideration to given rather balancing process, these factors is not a 272 usually contractorship. . .is established
\ . . tests, only by convincing and other of these accumulation solidly necessary employment often be if . . . can while strength [above].’ proved items the four of one of Mont, Sharp, supra.” 425, P.2d at 1301- 584 Larson, at 178 Sharp Sharp em- was an concluded In this Court independently ployee although established she owned an employer cleaning and rou- controlled business because paid cleaning tinely changed work, her details of her completed basis, monthly contract on a rather than any All these at time. her could terminate employer-employee strongly indicated factors relationship. (Mont. 1983), Cain Carlson v. recent case of St.Rep. 865, this
[204 311,] Mont. 664 P.2d Sharp. developed both Where the standard articulated challenged, legal are conclusions factual determinations apply. that factual the extent of review To two standards apply questioned, test set must we determinations are Sharp where substan the fact-finder and defer to forth support When, the determinations. evidence exists to tial only question law, this Court however, an issue raises evidence from the conclusions free to reach its own St.Rep. presented. 915-16, Carlson, at 868- at 664 P.2d *7 questions present Carlson, law case, of both In the presented. and fact are light of the case the facts of this
We will first consider support the lower the facts “four-factor test” and whether indepen- acting as an that claimant was Court’s conclusion accident. at the time of his dent contractor (1) right While or exercise of control. evidence of Direct right, emphasizes exercise and not the is the Larson that it points right, “if conclusive, con- out that is he of that which goes where to on than directions trol a trucker no farther of only usually up pick put load, held to be is this or down p. part 44.20, The 8-52. Larson Section a of the end result.” lower were free load as and court found that the truckers to they speed, wished, route, when time of choose their own Concluding travel, and driver. there was evidence that little right control, or exercise the court stated: makes that Davis told “Claimant much fact Tom transportation every them where load and unload. In point shipping contract has to a destination there and a agricultural transportation and in the informal world of supportive equally this a commodities fact contract relationship.” general contends statements Davis improper dangerous
was “the boss” and could correct an or employee situation should be sufficient to establish an rela tionship. right The of control Davis was lim Ranch required satisfactory ited to those few matters insure a end result. We conclude there is substantial evidence to support the conclusion of in the court that the first factor independent dicated an contractor status.
(2)
Payment. Payment
Method of
on
basis
a time
Mont,
strong
Sharp,
evidence of
status.
at
44.33(a), p.
1302; Larson,
ant was $28 ton after all the was hauled. There support is substantial evidence to This fac conclusion. weighs heavily against tor contention that he was claimant’s employee.
(3) Furnishing equipment. According Larson, employer equipment, when an furnishes an em valuable ployment relationship invariably exists, almost but the test equal does cut in not both directions with force. Proof showing equipment a worker furnished is not nec- his own *8 Larson, Sec- status. essarily finding to a of fatal - 44.34, paid by A pp. 8-95 8-104. trucker who tion hour, employer, for one performs a continuous service party, for that leases his vehicle to another and then drives may employee. well be an The lower court found work exclu- equipment, claimant furnished his own did not Davis, equipment, lease his and was sively for Tom did not There is substantial evidence to paid by period. not a time support argues that Tom Davis findings. these supplied expensive to truckers and controlled its loader use, case, employment. present In the un- which indicates to disputed evidence shows that claimant did not choose any equipment by use furnished the Davis Ranch on loaded, day the tractor owned was and instead used indicate claim- undisputed a fellow trucker. The facts ant’s to when he chose. We therefore freedom load and as Court conclusion agree the Workers’ furnishing equipment independent indicates an relationship. - (4) 44.35, pp. Larson Right to fire. states at Section 8-116 8-122. power power
“The to fire ... is the to control. The abso- liability is right relationship lute to terminate the without contract, concept independent not consistent with the legal right under which the contractor should have complete any at- project contracted for and to treat tempt prevent completion as a breach of contract.” p. addition at Larson notes:
“Examples multiplied could be in which most of the other - payment, furnishing equipment, indicia method of work, provision by skilled nature of the sometimes the em- insurance, not ployee even of his own assistants and infrequently right contractual of control and disavowals - employment pointed relation toward have fire, with its contractorship; yet right the one element of control, day for implied attendant has carried the right to relationship.” Here, the concluded that Workers’ party shows that contract evidence either this could any terminate the contract at time. The court concluded *9 that Tom because Davis would he liable to claimant “for any tonnage previously claimant, if hauled” he fired Davis liability, could not terminate is an without which indication independent relationship. of However, contractor if performed claimant were an in and had fact work hay, hauling payment in he would also entitled to the performed though work even he had been terminated as an employee. Similarly, independent if claimant were an con- terminated, tractor had been he still would entitled payment performance to for his of the contract the haul- ing hay up of to the time of termination. response leading
Claimant testified as follows to the question of his counsel: you agreement
“Q. Davis, As understood Mr. with did you any right go Mr. Davis have to let time? at “A. Yes.”
On cross-examination, claimant testified: you hauling hay,
“Q. Before started Mr. he Davis’ did tell you you many hay? that had to make so runs
“A. No. you hay, you “Q. If made one that could have run with your relationship, right? terminated isn’t that Yes, “A. I could have. you only got paid
“Q. run, But would have for the one right?
“A. Yes. payment say
“Q. And he didn’t was conditioned on you making five runs runs or six or whatever?
“A. No.” testimony specify The whether or Tom Davis does not not he believed he terminate at could will. sup
We conclude that there substantial evidence port finding part the Workers’ arrangement party Court that either could terminate the at support a conclusion However, no evidence there is will. any right at exercised could be termination such example, Davis that Tom no indication there is As an time. driving stopped down he was Solheim while have could replaced uncon- The different driver. him with a road support claimant that either the conclusion facts tradicted relationship employer at terminated could have or the delivery any being run, at the end the end of jus- does not The evidence the 7-W Ranch. a load of tify employer at fire claimant could that the a conclusion Sharp. any conclude that We therefore time, as was true right termi- did not have an absolute the Davis Ranch liability. any relationship Such a time without at nate finding supports in- control conclusion dependent distinguished relationship, from employer-employee. that of Compensa by Workers’ conclusion
We affirm the *10 factors shows consideration of all four tion Court that and that he claimant was an coverage by of Section 39- virtue therefore excluded from 71-118(l)(a), MCA.
II any argues regardless as that, determination Claimant independent contractor, entitled to he is to his status as an compensation insurer’s failure benefits because 39-71-606(1), days. deny MCA Section his claim within 30 states: thirty days deny accept re- or claim within “Insurer to — — (1) Every employer.
ceipt denial notice notice payment any plan com- of workers’ for the insurer under receipt pensation of a claim shall, within 30 benefits deny accept compensation, claim, if and for either writing the division the claimant and denied shall inform of such denial.” liberally argues more not be that insurers should injured
treated than an worker. Injured requirements notice workers are held to strict may qualify 39-71-603, under if their MCA and not overlooking argues claims are filed late. Claimant 39-71-606(1), mandatory language MCA and of Section holding relationship must be an there eligible benefits, before Work- claimant can become for nullity” Compensation ers’ Court section “a rendered that unjust more established a harsh and double standard favorable to the insurers than to the workers. Claimant also Compensation refers this Court to Montana Workers’ Manual, which states: mandatory presumably
“This [39-71-606] section comply requirements insurer that does not with its is con- accepted any sidered to have claim benefits for submitted.” Compensation Grosfield, Norman H. Montana Workers’ p. Manual, 5.30, unappealed
Claimant also refers to an decision of Workers’ which that court con- accepted compensable cluded that a claim must be as until Court, further order of this because a defendant had failed accept deny days, required the claim within 30 39-71-606, under Section MCA. compa- 39-71-606,
Claimant contends that Section MCA is 60-day rable to 39-71-603, notice statute. Section MCA pertinent part: states in injuries “Notice other than to be death submitted sixty days.
within No claim to benefits under the recover injuries resulting Act, Workers’ not may compensable death, unless, be considered within days after the occurrence of the which is claimed accident injury, place to have caused notice of time and *11 injury where the accident occurred the nature of the and given employer employer’s by to the in- or the insurer the jured employee employee’s or . . .” someone on the behalf. (Emphasis added.) by Legisla-
In that section there is the clear the conclusion may compensable ture that no claim be unless considered 278 important days. no given note It is 60
notice is within provision 30-day notice in the such conclusion is contained 39-71-606, MCA. of Section limitations, general of manner, statute
In the a similar part: 39-71-601(1), pertinent MCA states - presentment waiver. claim on “Statute limitation of (1) personal injury shall be death, all claims In case of employer, writing presented in to the barred unless forever may be, division, within insurer, the case the or the happening accident, ei- the months from the date of legally to act authorized ther the claimant or someone for him in his behalf.” Legis- expression
Again intention of we find the clear unless barred shall be forever lature that the claim period. presented time within the 30-day provision construing 39- of Section In meaning plain 71-606(1), MCA, must determine we language interpreting in accordance used, the words meaning, ordinary accepted the inten usual, gathered Legislature lan from the tion of the should Indemnity Company Cosgrove guage v. Industrial therein. (1976), 249, 254, 624. Where 552 P.2d 170 Mont. provision, penalty Legislature we should inserted a has not penalty. inserting any extremely such cautious before significant particularly here where That caution seems granted coverage because should be contention is made that finding notwithstanding deny claim, of the failure to employee. not an that the claimant fact was disagreement this the members between view of the application MCA, 39-71-606, it is of Section Court as to and conclusions to consider the statements well Compensation Court: Workers’ prevail case, ir- in this he should
“Claimant contends that finding regardless claimant was whether of this Court’s independent contractor, basis on the or an deny accept within claim claimant’s that insurer failed inge- receipt While this claim of the claim. after *12 ignores nious, insurer must it fact that basic any found under MCA bene- liable Section 39-71-407 before Chapters may fits under 6 or 7 of the Act be awarded. Sec- provides: tion MCA 39-71-407 “ Liability Every insurer is Insurers. liable ‘39-71-407. payment compensation, for a in the manner to the provided, extent to the an em- hereinafter ployer injury arising it insures who receives an out of and employment in his . . .’ course emphasized portion “As the statute makes above employment relationship clear, first, there must an liability must be before established a claimant becomes eli- gible any Here, for benefits . . . the Court has found that employment relationship no existed between claimant and Tom . . Davis . and therefore the insurer is not liable to for claimant benefits under 39-71-606 MCA. Simply employment relationship stated, the is the corner- upon stone which all under the Act are benefits founded. employment relationship, there is no the insurer is not If added.) any (Emphasis liable for benefits.” agree relationship We that the is a corner- upon compensation stone which workers’ benefits are mandatory Nonetheless, founded. we must consider the re- quirement acceptance for or denial of a claim within 30 days. specific requirement. legislative This a the ab- legislatively penalty, designed sence of a must we consider approval granted whether or not in claim must be order to protection afford reasonable to a claimant. provision penalty
We therefore consider the of Section 39- pertinent part provides 71-2907, in for an in- MCA which delay payment: crease of award because in of a payment unreasonably compensation “When has been delayed by prior subsequent insurer, refused an either by compensation to the issuance of an order the workers’ judge granting compensation benefits, a claimant the full compensation amount of the benefits a claimant . . . may judge by compensation be increased the workers’ added.) (Emphasis 20%.” foregoing Section allows
It is clear that the 20% speaks penalty delay payment. That unreasonable deny directly delay problem the failure to the involved penalty days. a provision that this claim within 30 We conclude 20% delay applied there has been can be where days provided by making within the 30 a decision 39-71-606, MCA. show a has failed to
We hold that the claimant *13 ap penalty granting of claim need for such a drastic proval as the accept deny claim within 30 for failure to or days, penalty provision affords and conclude that the 20% position protection in the same reasonable for claimants 39-71-606, in Section claimant this case. We hold that automatically a claimant to benefits MCA does not entitle deny accept or because of the failure of an insurer to days. claim within 30 judgment
The of the Workers’ affirmed.
MR. MR. JUSTICES CHIEF JUSTICE HASWELL and HARRISON and GULBRANDSON concur. dissenting: MORRISON,
MR. JUSTICE 39-71-606(1), majority correctly quotes MCA. The Section every mandatory shall, insurer This statute makes it that days compensation receipt either within of a claim for 30 of consequence accept deny only logical of or the claim. The deny acceptance. Com- failure to pensation Montana Workers’ The p. Grosfield,
Manual, H. Norman Section agrees. fact, the un- I that this has been would surmise practitioners, although derstanding among I acknowl- and luxury edge goes record, is the this outside the dissent. 39-71-606(1), effectively repealed majority has
The nothing less than result-ori- MCA. This seems me to my generally judicial brothers ented activism from those opposed considered to be to such conduct.
I consistency judicial philosophy would like to see more achieving and less reliance on desired result. MR. JUSTICE SHEEHY concurs. SHEA,
MR. dissenting: JUSTICE I would reverse the Worker’s Court because mandatory the State statutory duty Fund failed its deny accept receipt. The days claim within 30 of its failure to so acceptance do results The the claim. 39-71-606(1), statute is clear. Section provides: MCA “(1) Every any plan insurer under payment workers’ compensation benefits shall within 30 of re- ceipt of a compensation, claim for accept deny either claim, denied shall the claimant and the di- if inform vision in writing such added.) (Emphasis denial.”
The majority no gives meaning to this other than statute together read it possible penalties apply 39-71-2907, under MCA, if an “unrea- insurer has sonably delayed or . pay refused . .’’to benefits to claim- ant. I assume by the if majority opinion that the insurer accept does not days, or reject a claim within 30 if it is later found majority would compensable, *14 percent hold the penalty 20 under Section 39-71-2907 to Or, rationale, automatic. under majority must claimant establish also that the insurer was “unreasonable” notifying days not him position within 30 of its on the claim.
While possible ap- it is to construe Section 39-71-2907 to ply 39-71-606(1) mandatory to a situation under where the statutory duty given, of notice has not been this statute serve purpose majority cannot it serve lets statutory here. The percent penalty nothing 20 statute has to fact, do with is reading notice. a fair of the statute it assumes to given a notice has been the claimant and only question is was position whether the insurer’s un- in “delaying” pay reasonable in “refusing” the bene- fits owed. statute, Sec- believe, hand, notice
I the other lim- determining the time 39-71-606(1), tion stands alone deny a accept must act its within which an insurer The insurer. statute presented it has to the claim once been as a matter is deemed to exist only coverage can mean that nor denied the accepted of law if the insurer has neither days. mandatory claim within the 39-71-606(1) It important. is The last clause of denied and the inform the claimant reads: “. . . and if shall added.) purpose is Its division of such denial.” (Emphasis a prejudice can befall claim- accepted, clear. If a claim no division, ex- immediately him and the notifying ant not receiving immediately cept prejudice of not perhaps - in almost all cases cured. prejudice benefits that can claim but But if insurer denies the prejudice is clear The statute notify of the denial. fails the claimant by impos- designed protect prejudice against that kind of within 30 notify the claimant ing duty on the insurer to give this rejected. has Failure to that his claim been acceptance of the claim statutory written notice results as a matter law.