39-71-511, MCA

MONTANA SUPREME COURT DECISIONS
[1991] Thayer v. UEF, 1999 MT 304 The WCC properly concluded section 39-71-511, MCA (1991) authorized the Uninsured Employers' Fund 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 Ins. Co., 243 Mont. 226 (1990) and Skauge v. Montana States Telephone and Telegraph Co., 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.
[1991] Thayer v. UEF, 1999 MT 304 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. 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.
 
WORKERS' COMPENSATION COURT DECISIONS
Hilbig v. Uninsured Employers' Fund [02/20/09] 2009 MTWCC 6 Under § 39-71-511, MCA, the UEF is entitled to a setoff against benefits paid if Petitioner recovers monetary compensation as a result of her third-party claim. However, this does not entitle the UEF to refuse to pay benefits until Petitioner's third-party claim is resolved.
[1991] Hand v. UEF [9/18/00] 2000 MTWCC 59 Under section 39-72-305(2), MCA, which states that provisions of the WCA relating to uninsured employers and benefits due uninsured claimants apply to and are incorporated into the ODA, the setoff provisions of section 39-71-511, MCA, apply to cases involving occupational disease benefits. In appropriate cases, the UEF is entitled to discharge or reduce claims for OD benefits on the basis of civil recovery for the same alleged condition or harm. Here, the WCC was unable to determine the propriety of setoff because the parties' factual stipulation did not state whether claimant's settlement compensated him for the same harm or condition for which he now seeks OD benefits.

[1991] Gerald Thayer (Deceased), Phyllis Thayer v. Uninsured Employers' Fund [10/28/98] 1998 MTWCC 77, aff'd, 1999 MT 304. 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. See also Montana Supreme Court decision affirming WCC, Thayer v. Uninsured Employer's Fund, 1999 MT 304.

[1991] Gerald Thayer (Deceased), Phyllis Thayer v. Uninsured Employers' Fund [10/28/98] 1998 MTWCC 77. 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.