Utick v. Utick

• Court: Montana Supreme Court
• Writing for the Court: HASWELL
• Citation: Utick v. Utick, 593 P.2d 739, 181 Mont. 351, 36 St.Rep. 799 (Mont. 1979)
• Decision Date: 20 April 1979
• Docket Number: No. 14558,14558
• Parties: Andrew J. UTICK, Claimant and Appellant, v. Andrew J. UTICK d/b/a Capital Motel and Service Station, Employer, and State Compensation Insurance Fund, Defendant and Respondent.

Page 739

593 P.2d 739

181 Mont. 351

Andrew J. UTICK, Claimant and Appellant, v. Andrew J. UTICK d/b/a Capital Motel and Service Station Employer and State Compensation Insurance Fund, Defendant and Respondent.

No. 14558.

Supreme Court of Montana.

Submitted March 14, 1979.

Decided April 20, 1979.

Hoyt & Lewis, John C. Hoyt (argued), Great Falls, for claimant and appellant.

Tim W. Reardon (argued), Helena, for defendant and respondent.

HASWELL, Chief Justice.

Claimant Andrew J. Utick appeals from an order of the Workers' Compensation Court denying his request for a lump sum advance payment of total disability benefits due him from the State Compensation Insurance Fund.

Andrew J. Utick was the owner of the Capital Motel & Service Station in Helena, Montana, which he had operated and managed for the past 30 years. He had elected coverage for himself with the State Compensation Insurance Fund. Utick sustained two separate industrial accidents; the first on July 11, 1974, and the second on August 26, 1975. In the first accident, he sustained a fracture of the left ankle and foot. The second accident occurred when his weak left ankle collapsed and he fell and injured his back. At the time of the second accident, Utick was 63 years old.

As to Utick's first injury, the State Fund accepted liability and medical benefits were paid. Disability payments, however, were denied because Utick had allegedly lost no wages due to that injury. On the second injury, the State Fund denied the claim entirely on the grounds that Utick allegedly failed to file some required forms.

On June 21, 1977, Utick filed a petition for hearing with the Workers' Compensation Court, alleging that the State Fund had wrongfully failed and refused to pay the compensation due him. The petition asked that he be awarded temporary total disability compensation for the appropriate periods of time as a result of both industrial accidents; that his medical expenses be paid; that he be awarded a permanent partial disability award as a result of his injuries; that the award be paid in a lump sum; that he be awarded reasonable attorney fees and costs; and that the State Fund be assessed the statutory ten percent penalty for unreasonable refusal to pay the claims.

A hearing was held on the petition on December 22, 1977, at which time the State Fund acknowledged that it had accepted payment of premiums from Utick in regard to the second accident and that therefore coverage as to that accident would be conceded despite his alleged failure to file the required forms. Findings of fact, conclusions of law, and judgment subsequently entered determined, among other things, that Utick was entitled to temporary total benefits for only a portion of what he had requested; that he was suffering a permanent partial disability of 50%; and that he was entitled to the 10% Penalty increase on the award.

Utick filed notice of appeal from the judgment, but the notice was subsequently withdrawn when the State Fund's petition for rehearing was granted by the Workers' Compensation Court. The petition for rehearing was based on the fact that the Workers' Compensation Court's order was not clear as to whether Utick's permanent partial 50% Disability was to be paid biweekly or in a lump sum, and on an alleged miscalculation of the rate of compensation. Utick concurred in the petition for rehearing, alleging that a new hearing was necessary because the court, contrary to the evidence, had not found that he was totally permanently disabled.

Prior to the second hearing, Utick filed an affidavit with the court again requesting that his benefits be converted to a lump sum settlement. The affidavit showed that if he could receive the present value of his future benefits in a lump sum, he would lend the money to a family corporation which in turn would finance expansion of a restaurant on property owned by the corporation. By so doing, the affidavit alleged, Utick would be guaranteed an income of $20,500 per year as his share of lease payments to the corporation, whereas compensation benefits paid to him on a weekly basis would amount to only $7,923.76 per year.

At the rehearing, the Division of Workers' Compensation conceded the permanent total disability of Utick. The only issue contested was whether his request for a lump sum settlement should be granted. The Division resisted Utick's request for a lump sum award, but stated no reasons in support of its position. Both the Division and the Workers' Compensation Court acknowledged that the investment plan submitted by Utick in his affidavit in support of his request for a lump sum settlement would work. Nonetheless, the court found that while a lump sum settlement would be in Utick's best interests, the request would be denied since there was no real need shown. In its order of denial, the Workers' Compensation Court reasoned that payment under the plan proposed by Utick was "not in keeping with the spirit of the Act which is to pay compensation for loss of wages rather than indemnity payments for establishment of a claim." The court found that in Utick's case periodic payments best complied with the purpose and intent of the law. From the order denying his request for a lump sum settlement, Utick has brought this appeal.

Statutory authority for the conversion into a lump sum of biweekly payments provided for under the Workmen's Compensation Act is found in section 92-715, R.C.M.1947, now section 39-71-741 MCA. The grant or denial of a lump sum settlement will not be interfered with on appeal unless there is an apparent abuse of discretion. Kent v. Sievert (1971), 158 Mont. 79, 489 P.2d 104; Kuehn v. National Farmers Union Property & Cas. Co. (1974), 164 Mont. 303, 521 P.2d 921. Thus, the only issue for our determination on this appeal is whether there was an apparent abuse of discretion by the Workers' Compensation Division in resisting, and the Workers' Compensation Court in denying appellant's request for a lump sum settlement under the circumstances present here.

The general rule is that payments under the Workmen's Compensation Act are periodic. Lump sum settlements are an exception to the general rule. Malmedal v. Industrial Accident Board (1959), 135 Mont. 554, 342 P.2d 745; Laukaitis v. Sisters of Charity of Leavenworth (1959), 135 Mont. 469, 342 P.2d 752; Legowik v. Montgomery Ward (1971),157 Mont. 436, 486 P.2d 867; Kent v. Sievert, supra; Kuehn v. Nat. Farmers Union Property & Cas. Co., supra. This does not mean, however, that lump sum awards are looked on with disfavor. They should be awarded...