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IN THE WORKERS' COMPENSATION COURT OF THE STATE OF MONTANA
2002 MTWCC 23
WCC No. 2001-0412
TRANSPORTATION INSURANCE COMPANY
FINDINGS OF FACT, CONCLUSIONS OF LAW AND JUDGMENT
Summary: Claimant was injured in 1994 when a stretcher fell on her in a bathroom at work. She continued to have pain in her upper back and experienced depression which physicians suggested was attributable in part to her pain. Nonetheless, she returned to work full time and continued working for several years. Meanwhile, in 1995 she settled her claim for further benefits on a permanent partial disability basis with a 0% wage-loss factor. In August 1999, she was suffering from depression, panic attacks, agoraphobia, and post-traumatic stress syndrome and was unable to continue working. She requested that her settlement be reopened. The request was denied and she petitioned for mediation on November 29, 2000. The mediator's report issued January 4, 2001. She filed her petition for reopening with the Workers' Compensation Court on September 19, 2001.
Held: The petition is time barred under section 27-2-203, MCA, which requires that any action for rescission of a contract based on mutual mistake of fact must be brought within two years. While the two-year period may be extended and tolled during the pendency of mediation, which is required before filing of a petition with the Workers' Compensation Court, such extension applies only if the request for mediation is filed within two years and the pendency of mediation precludes filing with the Workers' Compensation Court within the two years.
¶1 The trial in this matter was held on April 3, 2002, in Great Falls, Montana. Petitioner, Laurie Preston (claimant), was present and represented by Mr. Richard J. Martin. Respondent, Transportation Insurance Company was represented by Mr. David M. Sandler.
¶2 Exhibits: Exhibits 1 through 12, 15, and 17 through 19 were admitted without objection. Exhibits 13, 14, and 16 were admitted over hearsay objections.
¶3 Witnesses and Depositions: Dr. Mary Ann Evans, the claimant, Roger Bridgeford, and Sandy Mayernik testified at trial. In addition the Court has received and considered depositions of the claimant and Dr. Mary Ann Evans.
(Pretrial Order at 2.)
¶5 Having considered the Pretrial Order, the testimony presented at trial, the demeanor and credibility of the witnesses, the depositions and exhibits, and the arguments of the parties, the Court makes the following:
FINDINGS OF FACT
¶6 The claimant is presently 39 years old. She has a GED and took secretarial courses. She was a credible witness.
¶7 In 1987 the claimant went to work for Bayside, a waste management company, doing secretarial and clerical work. Bayside was subsequently bought out by Waste Management, which is the employer in the present proceeding.
¶8 On September 14, 1994, while working for Waste Management, claimant went into the bathroom at her workplace. As she closed the door, an eight-foot metal stretcher, which was kept in the bathroom, fell on her from behind. Her description of the event was vivid and convincing. The stretcher bounced off her back and hit her for a second time. As she described it, she had the air knocked out of her and was sipping "tiny bits of air" in an attempt to reventilate. During the incident she thought that someone had been waiting for her behind the door and was attacking her. She was terrified.
¶9 Claimant injured her left arm in the incident and received medical treatment.
¶10 At the time of claimant's injury, Waste Management was insured by Transportation Insurance Company (Transportation). Transportation accepted liability for the industrial accident.
¶11 Claimant was off work for a period of time, returning to work on a full-time basis in approximately April of 1995. Following her return to work, she continued to experience back and shoulder pain.
¶12 On August 11, 1995, the claimant and Transportation entered into a settlement of her claim for the sum of $5,874.75. (Uncontested Fact 2; Ex. 3) The settlement provided for a lump-sum payment of permanent partial disability benefits. Claimant's entitlement to medical benefits was not settled and was left open.
¶13 Prior to the time of the settlement, claimant had been diagnosed as suffering from depression attributable to her accident.
¶14 Pursuant to Dr. Weinert's suggestion, claimant sought psychiatric treatment from Dr. John Mendenhall, a psychiatrist, who ultimately diagnosed claimant as suffering from depression. (Ex. 12.) Transportation's adjuster approved six visits to Dr. Mendenhall and claimant treated with him from August 23, 1995 to at least January 5, 1996. (Id.) Among Dr. Mendenhall's records is an office note dated March 15, 1995, but that note indicates it is for a "follow-up" visit. Dr. Mendenhall's note of August 23, 1995 (ex. 12-2), indicates that this was the first date he saw claimant and claimant testified that he first saw her after Dr. Weinert examined her in July 1995. I can only conclude that the March 15, 1995 date is erroneous and was likely made March 15, 1996.
¶15 Both claimant and Sandy Mayernik (Mayernik), the adjuster who executed the settlement agreement on behalf of Transportation, were aware at the time of the settlement that claimant was suffering from severe depression. Neither of them, however, was aware that the claimant suffered from mental conditions that would become totally disabling. At the time of the settlement, claimant had returned to work full time and had been working for several months. The settlement was based on a permanent partial disability basis with no wage loss: the amount paid to claimant represented 9% of 350 weeks, 2% for age, 2% for education and 5% for impairment. (Ex. 4.) There is no indication in Dr. Peterson's or Dr. Weinert's notes that claimant could not work on account of her depression, only that she should be treated by a psychiatrist. Dr. Mendenhall's records of subsequent treatment indicate that claimant's depression improved with the medications he prescribed.
¶16 In fact, claimant continued to work for another four years. However, her mental condition deteriorated during that time, making it increasingly difficult for her to work.
¶17 Over the four years she worked, claimant's performance at work declined. She experienced memory loss and a declining ability to concentrate. She became afraid to go into the bathroom at work, developing a phobia which ultimately prevented her from going to the bathroom at all while at work. She had difficulty waking up in the morning and was late to work. She also became fearful of driving and was sometimes unable to do so. She avoided using bathrooms in public places.
¶18 On February 12, 1999, at the recommendation of her family physician, claimant sought care from Dr. Mary Ann Evans, a psychiatrist. By that time, according to her own report, she was "very sick." Dr. Evans' intake record reflects that claimant
Dr. Evans' diagnoses included severe panic disorder with agoraphobia,
major depression, and post-traumatic stress disorder. (Ex. 9-3.) Dr. Evans'
diagnoses have not changed.
¶20 Dr. Evans' informed claimant of her diagnoses on February 12, 1999.
¶21 Claimant's condition worsened after she began seeing Dr. Evans. She felt that her medications were not working.
¶22 On August 9, 1999, claimant felt unable to continue working and wrote a resignation letter effective August 25, 1999. She followed through: her last day of work was August 25, 1999, and she has not worked since then. While Dr. Evans did not advise claimant to stop working, she agreed that as of August 25, 1999, the claimant was no longer able to work on account of her mental illnesses. In Dr. Evans' opinion, claimant continues to be unable to work. However, she believes further treatment, including both psychotherapy and cognitive therapy, may enable claimant to return to work and has not placed claimant at maximum medical improvement.
¶23 Dr. Evans relates claimant's mental illnesses to her industrial accident. On October 19, 2000, she wrote:
(Ex. 9-6.) At trial she testified that there may be underlying, predisposing genetic factors to claimant's illnesses but that the industrial accident triggered her symptoms.
¶24 I find that on August 9, 1999, the day claimant penned her resignation, she was aware that she could no longer continue working on account of her mental condition and believed that her condition was related to her 1994 industrial accident. Thus, as of that date she was aware of the alleged mutual mistake of fact upon which she premises her present petition. At the latest, she was aware of the mistake and its connection to her industrial accident on August 17, 1999, when Mr. Randall O. Skorheim, the attorney representing her at that time, wrote a letter to Sandy Mayernik requesting the insurer to reopen the claimant's claim on account of her mental condition and disability. (Ex. 14-1.)
¶25 As set out in my prior Order on Motion for Summary Judgment, 2002 MTWCC 10:
¶26 The petition in the present matter was filed on September 19, 2001.
CONCLUSIONS OF LAW
¶27 This case is governed by the 1993 version of the Montana Workers' Compensation Act since that was the law in effect at the time of the claimant's industrial accident. Buckman v. Montana Deaconess Hospital, 224 Mont. 318, 321, 730 P.2d 380, 382 (1986).
¶28 The claimant is seeking to rescind the 1995 settlement agreement and obtain reinstatement of compensation benefits. She urges that the 1995 agreement was predicated upon a mutual mistake of fact concerning the severity of her mental condition and the nature of her disability. Since general principles of contract law govern full and final compromise settlement agreements, the settlement may be set aside if the parties were operating under a mutual mistake of material fact when the agreement was made. Kienas v. Peterson, 191 Mont. 325, 524 P.2d 1 (1980); South v. Transportation Ins. Co., 275 Mont. 397, 401, 913 P.2d 233, 235 (1996).
¶29 Transportation urges that the request for reopening is barred by the statute of limitations provided in section 27-2-203, MCA, which states:
The section is applicable to requests for reopen. The limitations period begins running when the claimant discovered the mistake or would have discovered the mistake had she exercised ordinary diligence. Rath v. St. Labre Indian School, 249 Mont. 433, 439, 816 P.2d 1061, 1065 (1991).
¶30 Ordinarily, the claimant bears the burden of proving her entitlement to benefits. Ricks v. Teslow Consolidated, 162 Mont. 469, 512 P.2d 1304 (1973); Dumont v. Wicken Bros. Construction Co., 183 Mont. 190, 598 P.2d 1099 (1979). However, the statute of limitations is an affirmative defense. Rule 8(c), Mont.R.Civ.P. As with other affirmative defenses, the party here the insurer asserting that a claim is time barred bears the burden of proof. § 26-1-402, MCA and see Wareing v. Schreckendgust, 280 Mont. 196, 212, 930 P.2d 37, 46 (1996) (since estoppel is an affirmative defense, the party asserting the estoppel bears the burden of proof).
¶31 I previously denied Transportation's motion for summary judgment based on the statute of limitations because the date claimant learned or should have learned that her mental condition was totally disabling had not been established. I was therefore unable to determine whether claimant was aware or should have been aware of the alleged mistake more than two years prior to the filing of her action. Preston v. Transportation Insurance Company, 2002 MTWCC 10 (Order on Motion for Summary Judgment). However, after the trial of this matter, I have found that claimant became aware of the alleged mistake no later than August 17, 1999. She filed her petition September 19, 2001, more than two years thereafter.
¶32 Claimant argues that her petition was nonetheless timely because the statute of limitations did not commence running until the mediation process was complete. She cites the requirement that she submit her claim to mediation as a prerequisite to filing a petition with the Workers' Compensation Court, §§ 39-71-2401(1), -2408(1), and -2905, MCA. She argues that her claim or cause of action did not accrue until mediation was complete, citing section 27-2-102, MCA. If claimant's argument were adopted, the two-year statute of limitations applicable to the rescission of settlement agreements would never begin running until a claimant requests mediation. Thus, a claim for rescission could be brought five, ten, twenty, or more years after the claimant learns of the alleged mutual mistake of fact. Bizarrely, actions for rescission of a non-workers' compensation settlement or contract would remain subject to an absolute two-year bar based on discovery of the mistake.
¶33 Section 27-2-102, MCA, provides in relevant part:
The facts, as found herein, show that all of the elements of claimant's claim for rescission were present on August 9, 1999, and for certain no later than August 17, 1999. Claimant argues, however, that her action did not accrue at that time because this Court was not "authorized to accept jurisdiction of the action" until mediation was completed. Transportation replies that, unlike other statutes which provide for tolling of the limitations period during the pendency of special proceedings which are a prerequisite to any court filing, e.g., § 27-6-702, MCA, (tolling the statute of limitations respecting medical malpractice claims while the claim is being reviewed by a medical-legal panel), there is no provision for tolling or postponing the limitations period applicable to workers' compensation settlements and that the Court is barred from inserting any such provision, § 1-2-101, MCA.
¶34 "Jurisdiction involves the fundamental power and authority of the court to determine and hear an issue." State v. Diesen, 1998 MT 163, ¶ 5. As Deisen shows, where a statute imposes a specific prerequisite to invoking the jurisdiction of a court, the court is without jurisdiction until that prerequisite is met. Thus, it is clear that until mediation was complete this Court was without jurisdiction to entertain claimant's petition for rescission.
¶35 However, a fundamental rule of statutory construction requires that a particular provision of a statute not be read in isolation and that all provisions of a statute must be construed together to give effect and meaning to the entire statute. Section 1-2-101, MCA, which precludes judges and courts from inserting additional requirements or conditions in a statute, also provides, "Where there are several provisions or particulars [in a statute], such a construction is, if possible, to be adopted as will give effect to all."
¶36 In this case, two jurisdictions are in play that of the Workers' Compensation Court to issue a final, binding determination, and that of the Department of Labor and Industry to mediate the controversy. The Department's mediation role is provided in section 39-71-2401(1), MCA, which provides, "(1) A dispute concerning benefits arising under this chapter or chapter 72, other than the disputes described in subsection (2), must be brought before a department mediator as provided in this part." While the Department conducts an informal hearing and issues a recommendation for resolution, its recommendation is not in all cases final and enforceable; a party may reject the recommendation. § 39-71-2411(6), MCA.
¶37 In defining when an action accrues for purposes of statutes of limitations, section 27-2-102, MCA, refers to the time when "a court or other agency is authorized to accept jurisdiction of the action." On its face, the section contemplates not only the court's jurisdiction but also jurisdiction of any "other agency," which includes the Department of Labor and Industry (Department).
¶38 Under the mediation statutes applicable to workers' compensation cases, the claimant was required to submit to and exhaust the limited jurisdiction of the Department prior to invoking that of the Workers' Compensation Court. While it might be argued that the Department's authority does not amount to "jurisdiction" within the meaning of section 27-2-102(1)(a), MCA, because it does not have authority to issue a final and binding determination of controversy, a similar argument could be made with respect to justice courts, whose decisions in some cases can be appealed to district court on a de novo basis. E.g., § 46-17-311(1), MCA. While the decision of a justice court in some cases is non-binding if a party chooses to contest it, it can hardly be argued that the justice court lacked jurisdiction over the controversy: its decisions are binding lacking an appeal to district court. Similarly, a mediator's recommendation in a workers' compensation case is not binding if a claimant or insurer files a timely objection to the recommendation, but it is binding if a timely objection is not filed: section 39-71-2411(6), MCA, provides:
I therefore conclude that the "jurisdiction" within the meaning of section 27-2-102(1)(a), MCA, encompasses mediation of workers' compensation claims.
¶39 Having so concluded, it remains to be determined how section 27-2-102, MCA, applies to the dual jurisdiction situation presented in the present case. While claimant does not specifically do so, it might be argued that the section requires that she request mediation within two years and that following mediation she has another two years in which to petition the Court. The mere statement of the argument shows how absurd it is. Such construction would result in a four plus year statute of limitation, in effect creating two separate statutes of limitation. Under such construction, the claimant could file for mediation on the 730th day and then file her petition with the Workers' Compensation Court on the 730th day following completion of mediation.
¶40 Claimant has a singular cause of action for rescission. Section 27-2-102, MCA, provides a singular two-year limitation period for the commencement of that action. The only way the section can be reasonably interpreted in the dual jurisdictional situation involved in this case is to interpret it as requiring that the claimant file her petition for mediation within two years after discovery of the mutual mistake of fact and to toll the two- year limitation if the pendency of a mediation would otherwise preclude filing a petition in the Workers' Compensation Court within the two-year period. Failure to toll the limitation period under such circumstances would ignore the mediation requirement: a claimant could file for mediation weeks or even months prior to the expiration of the two-year limitation period yet be barred from pursuing her claim in the Workers' Compensation Court because the mediator's recommendation is not issued within the two-year limitation period. On the other hand, once the mediator's recommendation is issued, the claimant has the right to reject it and immediately file her petition with the Workers' Compensation Court. § 39-71-2411(6), MCA.
¶41 In this case, the mediator's recommendation was issued on January 4, 2001, some seven months prior to the running of the two-year period. Thus, there is no basis for tolling or extending the two-year limitations period. The petition is therefore untimely
¶42 The claimant's petition to rescind her 1995 settlement agreement with Transportation Insurance Company is time barred, § 27-2-203, MCA. Her petition is dismissed with prejudice.
¶43 This JUDGMENT is certified as final for purposes of appeal.
¶44 Any party to this dispute may have 20 days in which to request a rehearing from these Findings of Fact, Conclusions of Law and Judgment.
DATED in Helena, Montana, this 17th day of April, 2002.
c: Mr. Richard J. Martin
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