Uninsured Employers' Fund: Generally

MONTANA SUPREME COURT DECISIONS
Nasca v. Hull, 2004 MT 306 Montana District Court could properly exercise personal jurisdiction over out-of-state insurance agent who allegedly represented to business entity with car dealership in Montana that he had obtained workers’ compensation insurance valid in Montana for Montana business where Montana insurance not obtained.
Lako v. ERD/UEF, 2004 MT 290 The Supreme Court affirmed the determination by the WCC that the Uninsured Employers’ Fund (UEF) was not equitably estopped from asserting time filing requirements against the claimant where the claimant did not prove the first element of equitable estoppel--that the UEF misrepresented or concealed a material fact. UEF’s 1984 statement that it was not paying benefits due to its determination of insolvency was not a misrepresentation.
Olson v. Daughenbaugh, 2001 MT 284 Where the injured employee of an uninsured employer has already received his full entitlement to compensation pursuant to settlement negotiated with the UEF and the uninsured employer, section 39-71-515, MCA does not provide an independent cause of action allowing duplicative recovery. The section is one part of a comprehensive statutory scheme designed to ensure an injured worker receives compensation. While an employee may pursue various statutory remedies in an uninsured employer case concurrently, he is not entitled to duplicative recovery, but is bound by the first venue to reach decision.
Thayer v. UEF, 1999 MT 304 Section 39-71-511, MCA (1991), which authorizes the UEF to discharge benefits payable to claimants of uninsured employers by the amount of third-party recovery, does not violate the "full redress" provision of Article II, Section 16 of the Montana Constitution. Where the UEF is not an insurer and was statutorily created to provide a substitute source of benefits to the employee of an uninsured and impecunious employer, limiting the UEF's obligation to the extent of the uninsured employer's ability to compensate the claimant does not diminish the right to full legal redress against the uninsured employer.
Thayer v. UEF, 1999 MT 304 The WCC properly concluded section 39-71-511, MCA (1991) authorized the UEF to discharge $74,301 of future benefits still payable to widow who recovered $100,000 from employer in tort suit related to worker's death. The rule emerging from Ness v. Anaconda Minerals Company, 279 Mont. 472 (1996), Zacher v. American Insurance Company, 243 Mont. 226 (1990) and Skauge v. Montana States Telephone and Telegraph Company, 172 Mont. 521 (1977) that an insurer could not claim a subrogation interest in third-party recovery until claimant had been made whole is not applicable to the UEF's setoff under section 39-71-511, MCA. The UEF is not an insurer which has received premiums to assume certain risks, but merely stands in the shoes of the uninsured employer affording a claimant or beneficiary some relief when recovery is not had against the employer.
 
WORKERS' COMPENSATION COURT DECISIONS

Car Werks, LLC v. Uninsured Employers' Fund v. Gawronski [06/12/15] 2015 MTWCC 13 Although the initial pleading specifically contests DLI’s acceptance of a claim, the allegation encompasses the UEF since the UEF is part of DLI; even the Montana Legislature refers to the UEF as “the department” in § 39-71-520, MCA.

Emanuel v. Montana State Fund [05/01/15] 2015 MTWCC 8 A party to the action can call the UEF’s agents as witnesses and can offer its documents into evidence without forcing the UEF to be a party to this action merely to explain its reasons for denying liability.

Emanuel v. Montana State Fund [05/01/15] 2015 MTWCC 8 In an action between an injured worker and State Fund under § 39-71-405(1), MCA, the UEF is not a proper third party; if the injured worker prevails, State Fund can only seek indemnification from the uninsured contractor. Furthermore, the statute of limitations for an appeal of the UEF’s denial of liability has run, and the Court therefore lacks jurisdiction over the UEF.  The UEF consequently has no stake in the outcome of the case.

Cleek v. Uninsured Employers' Fund [08/08/12] 2012 MTWCC 31 Where a claim is denied, mediation of that denial encompasses all subjacent compensation issues whether or not they are specifically mentioned in the request for mediation.  For the UEF to maintain that its right to reimbursement is unassailable and its denial of liability uncontestable because Petitioner did not re-mediate his claim every time the UEF made a new determination, strains credulity.  The initial petition, timely mediated and timely filed seeks a determination as to whether Petitioner’s claim is compensable and whether the UEF is liable for payment of his benefits. These issues are in dispute and properly before this Court.
UEF v. Big Sky Petroleum, Montana State Fund, and Melvin J. Strong [4/29/04] 2004 MTWCC 39 Where an insurer accepts liability based on the employer's misrepresentation of the date of injury and the employer was uninsured on the actual date of injury, the insurer is entitled to rescind its acceptance, in which event the Uninsured Employers' Fund and the employer are liable for benefits.

Gerald Thayer (Deceased), Phyllis Thayer v. UEF [10/28/98] 1998 MTWCC 77. Under section 39-71-511, MCA, the Uninsured Employers' Fund is entitled to discharge the remaining $74,301.22 of future benefits payable to decedent's widow based upon her recovery of $100,000 from the uninsured employer in a tort lawsuit. The statutory authorization that the UEF may discharge benefits payable to claimants of uninsured employers by the amount of third-party recovery does not violate the "full redress" provision of Article II, Section 16 of the Montana Constitution. See also Montana Supreme Court decision affirming WCC, Thayer v. Uninsured Employer's Fund, 1999 MT 304.

Beaulieu v.UEF [3/2/98] 1998 MTWCC 16 In response to petition filed against both the Uninsured Employers' Fund and a corporation, the corporation admitted that it was the insurer for claimant's employer. It then moved to dismiss the UEF and argued that the WCC did not have jurisdiction to determine insured vs. uninsured status. WCC held that the corporation could not frustrate claimant's desire to have the WCC determine which entity should adjust his claim. The corporation's admission carries no more weight than any other allegation in a pleading.
Garcia v. Department of Labor & Industry ERD/UEF [11/7/97] 1997 MTWCC 59A Although the UEF is not listed within the definition of insurer contained in section 39-71-116(13), MCA (1995), section 39-71-505, MCA (1995) provides that "all appropriate provisions in the Workers' Compensation Act apply to the [Uninsured Employers'] fund in the same manner as they apply to compensation plans 1, 2, and 3. Given this provision, the UEF is subject to the same requirements as insurers under the workers' compensation statutes.
Garcia v. Department of Labor & Industry ERD/UEF [10/23/97] 1997 MTWCC 59 Because section 39-71-519, MCA (1995) expressly allows settlement among "any" of the parties enumerated in the statute, the Department of Labor could not disapprove a settlement between a claimant and an allegedly uninsured employer on the ground the UEF was not a party to the agreement.