Satterlee v. Lumberman's Mut. Cas. Co.

• Decision Date: 03 November 2009
• Docket Number: No. DA 08-0307.,DA 08-0307.
• Court: Montana Supreme Court
• Parties: Catherine SATTERLEE, Petitioner and Appellant, v. LUMBERMAN'S MUTUAL CASUALTY COMPANY, Insurer for Buttrey Food & Drug, Employer and Appellee. James Zenahlik, Petitioner and Appellant, v. Montana State Fund, Insurer for Eagle Electric, Employer and Appellee. Joseph Foster, Petitioner and Appellant, v. Montana State Fund, Insurer for Allen Electric, Employer and Appellee.

222 P.3d 566

2009 MT 368

353 Mont. 265

Catherine SATTERLEE, Petitioner and Appellant, v. LUMBERMAN'S MUTUAL CASUALTY COMPANY, Insurer for Buttrey Food & Drug, Employer and Appellee.

James Zenahlik, Petitioner and Appellant, v. Montana State Fund, Insurer for Eagle Electric, Employer and Appellee.

Joseph Foster, Petitioner and Appellant, v. Montana State Fund, Insurer for Allen Electric, Employer and Appellee.

No. DA 08-0307.

Supreme Court of Montana.

Argued June 10, 2009.

Submitted June 16, 2009.

Decided November 3, 2009.

For Appellants: James G. Hunt (argued); Hunt Law Firm; Helena, Montana, Thomas J. Murphy (argued); Murphy Law Firm; Great Falls, Montana.

For Appellees: Michael P. Heringer, Jon A. Wilson; Brown Law Firm, P.C.; Billings, Montana (for Lumberman's Mutual Casualty Company), Steven W. Jennings; Crowley, Haughey, Hanson, Toole & Dietrich, PLLP; Billings, Montana (for Intervening Insurers), Bradley J. Luck (argued); Garlington, Lohn, & Robinson, PLLP; Missoula, Montana (for Montana State Fund), Oliver H. Goe; Browning, Kaleczyc, Berry, & Hoven; Helena, Montana (for Montana Municipal Insurance Authority, Montana Association of Counties and Montana Schools Group Insurance Authority).

For Amici Curiae: Jon. W. Bennion; Attorney at Law; Helena, Montana (for Montana Chamber of Commerce, Montana Contractors' Association, Inc., and the National Federation of Independent Business Small Business Legal Center).

Justice W. WILLIAM LEAPHART delivered the Opinion of the Court.

¶ 1 Appellant Satterlee appeals from the Montana Workers' Compensation Court's (WCC) November 15, 2006 "Order Denying Petitioners' Motion to Allow Discovery and Granting Respondents' Cross-Motion for Partial Summary Judgment" and the WCC's June 4, 2008 "Order Granting Respondent Montana State Fund's Motion for Partial Summary Judgment."

¶ 2 We consider the following issues on appeal:

¶ 3 Did the Worker's Compensation Court err in determining that § 39-71-710, MCA, does not violate Satterlee's right to equal protection?

¶ 4 Did the Workers' Compensation Court err in determining that § 39-71-710, MCA, does not violate Satterlee's substantive due process right?

FACTUAL AND PROCEDURAL BACKGROUND

¶ 5 Three individuals, Catherine Satterlee, James Zenahlik and Joseph Foster (collectively Satterlee) all suffered work-related injures, which resulted in permanent total disability (PTD). Because of the injuries, Satterlee began to receive PTD benefits. When Satterlee became eligible for Social Security Retirement Insurance (SSRI), pursuant to § 39-71-710, MCA, the PTD benefits terminated.

¶ 6 Satterlee first challenged the constitutionality of § 39-71-710, as it applied to PTD benefits, in 2005 in the WCC. In its 2005 "Order Denying Motion for Partial Summary Judgment," the WCC held the statute to be constitutional as applied to PTD benefits.¹ Satterlee appealed and this Court dismissed the appeal without prejudice because the order fell short of a final judgment² and identified two remaining unresolved issues to be decided by the WCC: 1) Whether § 39-71-710, MCA, violates Satterlee's right to due process; and 2) Whether § 39-71-710, MCA, unconstitutionally or impermissibly discriminates against Satterlee based on age.

¶ 7 In January 2006, Satterlee moved for reconsideration of the WCC's 2005 order denying Satterlee's motion for partial summary judgment. The WCC granted Satterlee's motion for reconsideration and granted Satterlee leave to file a motion and brief requesting additional discovery, pursuant to M.R. Civ. P. 56(f). However, in its order granting Satterlee leave, the WCC noted that its previous analysis of the constitutionality of § 39-71-710, MCA, as it related to PTD benefits, "was not grounded on the specific economic analyses proffered by [Lumberman's]." However, the WCC noted that it did factor into its analysis that "providing PTD benefits to injured workers beyond the time they were eligible for retirement benefits had a general negative economic impact on the workers' compensation system." After entertaining arguments regarding whether additional discovery pertaining to specific economic impacts of a ruling on the constitutionality of § 39-71-710, MCA, in its 2006 order, the WCC denied Satterlee's motion to allow discovery and granted Lumberman's cross-motion for partial summary judgment. The WCC explained that its previous constitutional analysis "was not grounded on the specific economic analyses proffered by [Satterlee]" and it was not persuaded that additional discovery regarding economic costs would preclude summary judgment in favor of Lumberman's.

¶ 8 Montana State Fund then moved the WCC for partial summary judgment on the two remaining issues identified by this Court. In 2008, the WCC granted Montana State Fund's motion for summary judgment.³ Satterlee appeals.

STANDARD OF REVIEW

¶ 9 In reviewing the WCC's grant or denial of summary judgment, this Court uses the same standard used in ruling upon a motion for summary judgment; we determine whether there is an absence of genuine issues of material fact and whether the moving party is entitled to judgment as a matter of law. Otteson v. Mont. State Fund, 2005 MT 198, ¶ 8, 328 Mont. 174, 119 P.3d 1188.

¶ 10 The issues before us involve questions of constitutional law. The standard for reviewing conclusions of law is whether they are correct. Henry v. State Compen. Ins. Fund, 1999 MT 126, ¶ 10, 294 Mont. 448, 982 P.2d 456.

The constitutionality of a legislative enactment is prima facie presumed, and every intendment in its favor will be presumed unless its unconstitutionality appears beyond a reasonable doubt. The question of constitutionality is not whether it is possible to condemn, but whether it is possible to uphold the legislative action which will not be declared invalid unless it conflicts with the constitution, in the judgment of the court, beyond a reasonable doubt.

Powell v. State Compen. Ins. Fund, 2000 MT 321, ¶ 13, 302 Mont. 518, 15 P.3d 877. The party challenging the constitutionality of a statute bears the burden of proving the statute unconstitutional beyond a reasonable doubt. Henry, ¶ 11. If any doubt exists, it must be resolved in favor of the statute. Powell, ¶ 13.

DISCUSSION

¶ 11 The issue before the Court is the constitutionality of § 39-71-710, MCA. Satterlee claims the statute is unconstitutional because it denies PTD benefits to Satterlee and other similarly situated individuals on the basis of their age. Satterlee argues that, based on our holding in Reesor v. Mont. State Fund, 2004 MT 370, 325 Mont. 1, 103 P.3d 1019, "the Court should find that § 39-71-710, MCA, violates the Equal Protection and Substantive Due Process Clauses of the Montana Constitution and illegally discriminates based on age." Appellee insurance companies urge this Court to uphold the WCC's decision finding § 39-71-710, MCA, to be constitutional, as it is applied to PTD benefit recipients who become eligible for SSRI benefits.

¶ 12 The declaration of policy supporting the Workers' Compensation Act (WCA) states:

[a]n objective of the Montana workers' compensation system is to provide, without regard to fault, wage-loss and medical benefits to a worker suffering from a work-related injury or disease. Wage-loss benefits are not intended to make an injured worker whole but are intended to assist a worker at a reasonable cost to the employer. Within that limitation, the wage-loss benefit should bear a reasonable relationship to actual wages lost as a result of a work-related injury or disease. § 39-71-105(1), MCA.

Section 39-71-710, MCA, provides:

[T]ermination of benefits upon retirement. (1) If a claimant is receiving disability or rehabilitation compensation benefits and the claimant receives social security retirement benefits or is eligible to receive or is receiving full social security retirement benefits or retirement benefits from a system that is alternative to social security retirement, the claimant is considered to be retired. When the claimant is retired, the liability of the insurer is ended for payment of permanent partial disability benefits other than the impairment award ... and medical benefits. (2) If a claimant who is eligible under subsection (1) to receive retirement benefits and while gainfully employed suffers a work-related injury, the insurer retains liability for temporary total disability benefits, any impairment award, and medical benefits.

¶ 13 Workers become eligible for SSRI when they reach full retirement age and have enough social security earnings to be fully insured. 20 C.F.R. § 404.310 (2009). Full retirement age has traditionally been 65 years. However, this age is gradually being increased based on an individual's date of birth. Under the current regulatory scheme, the full retirement age for individuals born after January 1, 1960 is 67 years. 20 C.F.R. § 404.409(a) (2009). Therefore, for the purposes of applying § 39-71-710, MCA, an individual will reach the age of "retirement" between the ages of 65 and 67 depending on his or her date of birth. With this understanding of the interplay between SSRI and PTD benefits we now turn to the issues at bar.

¶ 14 1. Did the Workers' Compensation Court err in determining that § 39-71-710, MCA, does not violate Satterlee's right to equal protection?

¶ 15 Article II, Section 4 of the Montana Constitution provides that "[t]he dignity of the human being is inviolable. No person shall be denied the equal protection of the laws." "The basic rule of equal protection is that persons similarly situated with respect to a legitimate governmental purpose of the law must receive like treatment." Rausch v. State Compen. Ins. Fund, 2005 MT 140, ¶ 18, 327 Mont. 272, 114 P.3d 192 (Rausch II) (citing Powell, ¶ 22). In addressing an equal protection challenge, this Court follows a three-step process. Henry, ¶ 27. First, we must identify the classes involved and determine whether they are...