Malek v. Henry's Safety Supply Co., 89-512
| Decision Date | 13 March 1990 |
| Docket Number | No. 89-512,89-512 |
| Citation | 790 P.2d 965,242 Mont. 311 |
| Parties | David A. MALEK, Claimant and Respondent, v. HENRY'S SAFETY SUPPLY COMPANY, Employer, and State Compensation Insurance Fund, Insurer and Appellant. |
| Court | Montana Supreme Court |
Richard E. Bach, Charles Adams, Helena, for insurer and appellant.
Geoffrey R. Keller, Matovich, Addy & Keller, Billings, for claimant and respondent.
The State Compensation Insurance Fund appeals from a judgment of the Workers' Compensation Court ordering the Fund to return monies to the claimant. We affirm.
In this case we hold principally that the Workers' Compensation Court had subject matter jurisdiction to compel the State Compensation Insurance Fund, where no prior determination had been made as to subrogation rights by the Division of Workers' Compensation, to return subrogation funds to the claimant.
Respondent David Malek suffered an injury compensable under the Workers' Compensation Act when he was injured in an automobile accident on February 8, 1985. Malek fully settled the resulting third-party action for $25,000, the third-party driver's insurance policy limits.
On March 27, 1985, a claims examiner for the State Compensation Insurance Fund (Fund) informed Malek that the Fund was entitled to a 50 percent subrogation interest in his third-party settlement under the provisions of Sec. 39-71-414, MCA. Malek thereafter paid the sum of $12,500 to the Fund.
Malek retained counsel in 1988 to pursue a claim for permanent partial disability benefits. Shortly thereafter Malek filed a petition with the Workers' Compensation Court seeking, amongst other things, to have the $12,500 subrogation payment refunded as Malek alleged he had not been fully informed of the subrogation issues, and that until action by the Division no subrogation entitlement in favor of the Fund existed.
The Fund filed a motion to dismiss the portion of the petition relating to the determination and allocation of subrogation under the provisions of subsection (5) of Sec. 39-71-414, MCA. That section reads:
(5) If the amount of compensation and other benefits payable under the Workers' Compensation Act have not been fully determined at the time the employee, the employee's heirs or personal representatives, or the insurer have settled in any manner the action as provided for in this section, the department shall determine what proportion of the settlement shall be allocated under subrogation. The department's determination may be appealed to the workers' compensation judge.
The Workers' Compensation Court, pursuant to Sec. 39-71-414(5), MCA, granted the Fund's motion to dismiss the subrogation issue. It then ordered the Fund to return immediately the $12,500 payment to the claimant.
The Fund now appeals the lower court's order, maintaining that the Workers' Compensation Court was without jurisdiction to order a return of the subrogation funds.
This Court recently held, in First Interstate Bank v. Tom Sherry Tire, Inc. (1988), --- Mont. ---, 764 P.2d 1287, that the Workers' Compensation Court is without jurisdiction over the issue of subrogation where a third-party settlement precedes a petition for full and final settlement of workers' compensation benefits. In such a situation, under the statute, the Workers' Compensation Division, and not the Workers' Compensation Court, has jurisdiction.
The issue now before this Court requires a closer look at Sec. 39-71-414(5), MCA, and the jurisdictional powers of the Workers' Compensation Court.
The Workers' Compensation Court is granted general jurisdiction by Sec. 39-71-2905, MCA. This statute reads in part:
Petition to workers' compensation judge. A claimant or an insurer who has a dispute concerning any benefits under Chapter 71 of this title may petition the workers' compensation judge for a determination of the dispute after satisfying dispute resolution requirements otherwise provided in this chapter.
* * * * * *
... The workers' compensation judge has exclusive jurisdiction to make determinations concerning disputes under Chapter 71....
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Francetich v. State Compensation Mut. Ins. Fund
...1990, the State Fund refunded to claimant the aforesaid $5,391.03 pursuant to the decision of this Court in Malek v. Henry's Safety Supply Company (1990), 242 Mont. 311, 790 P.2d 965. 7. The State Fund has demanded that it only be required to pay any future compensation or medical benefits ......