*1 THOMPSON, GREGG Petitioner/Appellant,
CIGNA,
Respondent/Insurer HOSPITAL, DEACONESS Employer/Respondent. No. 99-582. Briefs
Submitted
2000.
on
Decided December
2000.
For Leo S. & Hoven, Helena. Opinion
JUSTICE NELSON delivered the Court. Compensa- decision of the Workers’ Gregg appeals a *2 for un- declining penalty against tion Court to assess a 20% CIGNA reasonably delaying payment Thompson pursuant (1981). We affirm. Thompson following appeal: raises the issue on ¶2 refusing Whether the Court erred in ¶3 pursuant award the 20% to § Background Factual and Procedural 22,1981, Thompson injury suffered an to his knee on October ¶4 insured working Hospital. hospital while for Deaconess accepted liability claim and paid CIGNA who for the and medical dis fall ability Thompson’s injuries occurred in the benefits. Since 1981, applies the 1981 version of Workers’ Thompson’s Hosp. all claim. Deaconess facets of Buckman Montana 318, 321, 730 (citing Trusty v.Consoli 224 Mont. 1087; Freightways dated Argonaut Iverson v. Ins. Co.
1367). surgeries 13 knee injury, Thompson a result ofhis underwent As Thompson per- him permanently totally disabled. received left However, bi-weekly disability benefits on a basis. manent total week, benefits, frozen Thompson’s amounting per at $162.21 wage and benefit level. Sheehy attorney Patrick In March retained asserting claim after Thompson’s settle enough inflation, was not years per week benefit $162.21 family. his on June Consequently, sustain Sheehy requesting Thomp- information wrote CIGNA requested However, provide the informa- son’s claim. CIGNA did not 9,1997. September tion until 23,1997, Sheehy sent a letter wherein he September CIGNA On per- lifetime exposure permanent-total
calculated CIGNA’s for letter, $226,675.77. In his disability benefits at manent-partial Instead, Sheehy requested did not make a settlement demand. he an that CIGNA make offer settlement. 11,1998, sending after first On almost five months
letter, reply CIGNA, Sheehy, having received no sent another explaining Thompson’s requesting letter financial needs and discus- sions on or a partial settlement advance. When CIGNA again respond, Sheehy April 2, failed to sent third letter on setting present Thompson’s forth a value calculation of benefits of $106,879.88. Noting in present this letter that value reductions are claims, claim Sheehy not allowed on settle offered to for $150,000 lump-sum payment. finally responded in June negotiations began. and settlement By July had agreed annuity $121,132. However, the amount of adjuster, CIGNA’sin-state Michele Fairclough, did not have proposed for the Fairclough amount. indicated that she would need to request author- November, from a In early Fairclough CIGNA claims committee. Sheehy suggested signed contacted he send a settlement pe- $121,132 tition they discussed. she did not yet authority, Fairclough have settlement indicated that she was con- fident the proposal approved. would be him later testified that called in late Novem- *3 early
ber or him authority December to tell that she had settlement $121,132. However, contrary assertions, Sheehy’s to Fairclough testified that she did authority not have settlement at the time and Sheehy would not have told that she did. 1999, In January Fairclough’s supervisor her aget
¶11 directed to annuity $7,500 quote, overpayment account, new to take a into and to explore possible end, settlement of medical benefits. To Fairclough $117,100. annuity quote obtained new in the amount of Fairclough subsequently annuity quote discussed new with Sheehy along $7,500 prior with need to offset the advance and a Security overpayment. addition, Social Fairclough indicated that $10,000 they CIGNAwould add settlement amount if were able to close the medical benefits as well. Sheehy objected change to this in the settlement On terms. Feb-
ruary 9,1999, Sheehy Hearing requesting filed a Petition for Compensation agreement Court enforce the settlement $121,132 reached between the parties the amount of and award delay pursuant 20% increase for unreasonable attorney’s fees and costs. as well as 1999, corporate At the end of received final $121,132. authority to claim for She then forwarded settle the original petition, which she received November, Industry approval. 29, 1999, settlement on March department approved 26,1999. April issued the settlement checks on date, hearing regarding Thompson’s peti- held 14 That same was ¶ entitled issues were whether was presented tion. The he was entitled attor- to an of a 20% whether award 17,1999, August Compensation the Workers’ ney’s fees and costs. On Fact, Judgment Findings of Conclusions of Law and Court issued its unrea- determined case was wherein court the result of CIGNA’s violation of sonable designate an in-state requiring insurers the court deter- settle claims. unreasonably, it declined 20% mined that CIGNA acted Nevertheless, attorney’s his the court did award penalty. fees and costs. Court’s refusal Thompson appeals the Workers’ penalty.
to award 20%
Discussion refusing to Compensation Court erred in the Workers’ Whether 39-71-2907, MCA penalty pursuant award the to § 20% findings of Workers’ fact We review credible evi they supported by are substantial to determine whether 5, Fund, 1999 MT v.State Ins. ¶ dence. Matthews (citing EBI/ Group Blythe, v. Orion ¶ ¶ 17). 356, 17, Our re ¶ 957 P.2d 1998 MT ¶ ¶ law ple conclusions of Court’s view of the Workers’ law correct. its conclusions of nary; determine whether Fund, MT Matthews, (citing Liberty ¶ State ¶ 5 7). Mont. ¶ ¶ although Compensation Court determined The Workers’ authority adjuster an in-state
CIGNA’s failure *4 case, court was this caused an unreasonable settle claims express because of the awarding Thompson penalty a precluded §39-71-2907, (1981), and provisions of§ of provides Section for conversion bi-weekly lump payments into a sum:
Compromise lump-sum payments settlements —divi- approval required. biweekly payments provided sion1 The for may converted, chapter part, in this be in whole or into lump-sum payment. upon Such conversion can be made injured application written of the worker or the worker’s benefi- insurer, ciary, with the concurrence ofthe and shall rest in the dis- division, of the such lump-sum cretion both to the amount of advisability payment and the of such The is conversion. division hereby authority, power, jurisdiction vested full to allow approve compromises chapter. of claims under this All settle- and compromises compensation provided chapter ments of Approval void without divi- division. of writing. directly sion must be in The notify every division shall approving claimant of division or denying a claimant’s compromise A controversy claim. between claimant and pay- an insurer ofbiweekly conversion into a dispute ments which considered a for the work- compensation judge jurisdiction ers’ determination. has make a [Emphasis added.]
Hence, lump-sum payment case, before a could be disbursed in it this approved by had to Department be what is now the In- of Labor and dustry. Under the in effect lump-sum law conversions
exception
general
payment
rule that the
of benefits under the
Workers’
Act
periodic.
should be
Sullivan v.Aetna Life
& Cas.
894 P.2d
280. Accord Utick v.
(citations
Utick
omit
ted).
reasoning
average
The
behind this rule
was
worker
whose protection
Workers’
is intended would
incapable
handling single large
money,
sum of
would
dis
soon
sipate it, and
then
as poor
would
be in
straits as if
Compen
(cit
sation
never
existed.
in v. Tomahawk pen ofthe clearly imposition 39-71-2907] allows that “[§ due, is, pay- owed and alty only upon those benefits which payable” in the case sub payment was “owed and lump-sum able.” No the settlement judice approved until of Labor settlement, And, department approved once the March 1999. issuing the check. promptly CIGNA acted failing actions in do not condone CIGNA’s we and letters requests for information promptly respond Thompson’s negotiations and to CIGNA’s violation au- an in-state failing claims, construe the thority agree with CIGNA that suggested by Thompson statutes as would ab- lump-sum department as the final decision rogate purpose their remove Furthermore, concerning Thompson is cor- maker settlements. while pertain in effect in 1981 that to his arguing rect statutes *6 (re- favor, 39-71-104, claim liberally should construed in his § 1987), pealed that does not entitle us to read into the Workers’ Com- “In construction of a stat- pensation Act terms that are not there. ute, judge simply the office of the to ascertain and declare what is in therein, terms or in contained not to insert what has been substance 1-2-101, omitted or to omit what has been inserted.” Section MCA. considered, Moreover, multiple provisions where code must be case, is, in if possible, adopted this “such a construction to be as will 1-2-101, give effect to all.” Section MCA. Accordingly, Compensation hold that the Court we Workers’
correctly plain wording precluded determined that the of the statutes in awarding penalty this case. Affirmed. TURNAGE,
CHIEF JUSTICE JUSTICES LEAPHART and GRAY concur. dissenting.
JUSTICE REGNIER I Court and this disagree Compensation the Workers’ in penalty unique presented Court and would under the facts 39-71-2907, MCA my majority this case. In view the has construed § narrowly. too following findings Compensation The Court made the Workers’ adjuster, delay providing in its resident respect to CIGNA’s $121,132. The Fairclough, authority Michelle to settle for Workers’ matter would have been re- Court found that this Compensation legal never have ensued had solved in 1998 and this action would adjuster and had a resident with au- complied with the law thority telephone The Court further found that a present Montana.
conversation occurred November in which Ms. approved communicated with Mr. that CIGNA had the settle- $121,132. conversation, Subsequent ment to this CIGNA’s (words “corporate out-of-state bureaucratic maze” of the Workers’ Court) Compensation adjuster then their in-state in the put position change the terms of the attempting agreed-upon settlement. delay Workers’ found the resulted from requires CIGNA’s violation of Rule which compensation carriers to in-state with author- importantly, claims. Most the Workers’ settle especially light Court found that CIGNA’s was unreasonable 24.29.804, Rule of CIGNA’s violation of ARM. Because of CIGNA’s de- claimant lay, to file a petition hearing was forced on than more six months after Workers’ Court found that the matter should been resolved. have account, Notwithstanding compelling factual both the this Court and this Court conclude that a (1981), provides pen- is not allowed because “full compensa- alties can be awarded based on the amount of the majority tion benefits due a claimant ...” The then refers to § provides that all settlements void Com- specific without the written ofthe Division of Workers’ Industry. together, pensation, now the Read drags according majority, there can be no if an insurer processing specific its feet in settlement documents or even violates regulations that control insurers because settlement does exist Department. until it is approved correctly by majority, As noted must decide this case un- injured in 1981. Section applied persons der the law that *7 39-71-104, (1981), subsequently repealed, pro- MCA which has been vided: chapter. give
39-71-104. Court liberal construction interpreted thereof is chapter part Whenever this or section court, by court. by liberally it shall construed such be this mandate. In Tweedie v.In- my majority ignored In view the has (1936), Accident Board dustrial interpreted this statute to mean that the is to be liber- legislation purposes that the humane of the
ally construed by defeated narrow and technical construction. Given shall that the insurer findings ofthe Workers’ Court specific by not regulations govern of this state that insurers disregarded the claims, that the resident having a unreasonable, delay pre- that the by caused CIGNA was receiving by his settlement over six vented this claimant months, travesty I fol- it is a that a was not awarded. would 39-71-104, (1981), interpret § low the mandate of § due at a to mean that the time point July sifter when the Workers’ This Court determined that the matter should have been resolved. by Court accomplished could have been findings (concluding in 30 that this matter should following up its ¶ 1998) an additional finding have been resolved thereafter, allowing time compensation was due within reasonable for a the settlement of the Di- period process papers. vision, Industry, formality now the was a agreed upon when the claimant and the insurer a settlement. Cer- tainly legislature adopted prevent displayed by the conduct such as was case. In Utick v. Utick we faced a unique
similar situation and reversed the Workers’ denying request the claimant’s for a pay advance ment of benefits. our decision we directed that a be im posed. Just compelling pen the facts ofthis case are and a alty should be I awarded. dissent. TRIEWEILER, join
JUSTICE in the HUNT JUSTICE foregoing dissenting opinion.