39-71-612, MCA


[1991] S.L.H. v. State Fund [12/28/00] 2000 MT 362 Under section 39-71-612, MCA (1991), costs and attorney fees may be assessed against an insurer by the workers' compensation judge when: 1) there is a payment or written offer of payment; 2) there is a controversy relating to the amount of compensation due; 3) the claim is brought before the court for adjudication; and 4) the judge's award is greater than that offered by the insurer. When the conditions for an award of attorneys fees pursuant to the section are satisfied, the award of attorney fees and costs to the claimant is not discretionary.

In contrast to section 39-71-2907, MCA (1991), which authorizes an award of penalty against an insurer for unreasonable delay where the insurer settled "on the courthouse steps," section 39-71-612, MCA (1991) does not allow an award of attorney fees unless the case was actually brought before the workers' compensation court for adjudication and the judge makes an award greater than that offered by the insurer.

An insurer's unfounded claim for subrogation with respect to benefits already paid does not constitute unreasonable denial or delay in paying benefits permitting an award of attorneys fees under section 39-71-612, MCA (1991). However, an insurer's claim for subrogation not well grounded in fact and law as required by section 39-71-2914, MCA (1991) warrants an award of sanctions under that statute against the represented party, the attorney, or both.

[1983] Galetti v. MPC [8/29/00] 2000 MT 234 Unlike subsequent versions of the statute, section 39-71-612, MCA (1983) allows an award of attorney fees where an insurer settles prior to trial, where the following conditions are met: (1) an employer or insurer must pay or tender payment of compensation under chapter 71 or 72; (2) there must be a controversy which relates to the amount of compensation due; and (3) the settlement or award must be greater than the amount paid or tendered by the employer or insurer.
[1979] Madill v. State Fund, 280 Mont. 450, 930 P.2d 665 (1996) Under 1979 version of statute, attorney's fee award was proper even though case settled without reaching WCC.
Salazar v. Montana State Fund [12/28/11] 2011 MTWCC 28 If the Court grants an award greater than the amount offered by the insurer, it may award attorney fees if it believes the insurer’s actions were unreasonable. However, the amount the insurer held in reserve has no relevance to a determination of attorney fees under § 39-71-612, MCA.
Briese v. Ace American Ins. Co. [02/20/09] 2009 MTWCC 5 Sections 39-71-611 and -612, MCA, address the potential liability of an insurer for reasonable attorney fees if the Court determines the actions of the insurer were unreasonable in its payment of benefits. A Lockhart lien, conversely, addresses the payment of attorney fees paid by the claimant “out of his or her medical benefits.” Therefore, Respondent’s reliance on these statutes for the argument that this Court lacks jurisdiction to determine a Lockhart lien is misplaced.

[1989] Doubek v. CNA Ins. Co. [11/10/04] 2004 MTWCC 76 An insurer acts unreasonably and is liable for attorney fees pursuant to § 39-71-612, MCA (1989), with respect to denied medical benefits where the treating physician finds a causal relationship between the medical condition treated and the industrial injury or occupational disease and where the physician expressing a contrary opinion was hired by the insurer, was provided with only selected records regarding the claimant's treatment, is less qualified than the treating physician, and relies on a medical test of questionable quality and value.

[1993] Nielson v. State Fund [2/20/04] 2004 MTWCC 12 Where arguments of insurer in opposition to claimant's request for impairment award of fifty percent were not unreasonable, claimant is not entitled to attorney fees. § 39-71-612, MCA (1993). However, if the 42% has not been paid, claimant is entitled to a penalty on that portion.
[1999] Bustell v. AIG Claims Service and The Ins. Co. of PA [11/14/03] 2003 MTWCC 66 While the attorney fee regulation of the Department of Labor and Industry, ARM 24.29.3802, was expressly enacted under section 39-71-613, MCA (1999), subsection (2) of that section generally authorizes it to establish attorney fees. The provision in section 39-71-614(2), MCA (1999), limiting the Court to the Department's schedule when awarding attorney fees is mere recognition of the Department's authority under section 39-71-613, MCA.
[2001] Pekus v. UEF [4/25/03] 2003 MTWCC 33, rev'd in part, 2012 MTWCC 42 The UEF is not an insurer under section 39-71-611 or 39-71-612, MCA (2001), and is not subject to an award of attorney fees.
[2001] Hernandez v. ACE USA [4/24/03] 2003 MTWCC 32 An insurer acts unreasonably when it allows a settlement proposed by its Montana adjuster to be vetoed by the employer/insured. Where the claimant has to petition the Court to effectuate the proposed settlement, he is entitled to attorney fees.

[1983] Galetti v. MPC [12/03/02] 2002 MTWCC 60 Under the attorney fee provision, section 39-71-612, MCA (1983), fees apply only to "compensation" awarded to claimant. A "penalty" is not compensation.

[1999] Liberty Northwest Ins. Corp. v. Halling and Oliver [1/7/02] 2002 MTWCC 1 Where an insurer has filed a declaratory judgment action placing at issue the amount of a minor's workers' compensation death benefits, and has withheld some benefits due some beneficiaries, it is within the equitable power of the Court and the costs provision of section 39-71-612, MCA (1999), to treat guardian fees as a cost to be assessed against the insurer.
[1983] Galetti v. MPC [12/05/01] 2001 MTWCC 60 In a Subsequent Injury Fund case, an insurer or self-insured which fails to provide the notice required by section 39-71-908, MCA (1983), and denies a claim for further benefits, is liable for attorney fees and a penalty where the claim is subsequently submitted to the Subsequent Injury Fund and accepted by it.
[1991] Shepard v. Borden, Inc. [5/23/00] 2000 MTWCC 28 Although claimant found PTD, insurer did not act unreasonably where it kept claimant on TTD, without threatening to cut him off, pending resolution; diligently explored finding claimant productive employment; and relied on doctor's opinion claimant "can probably return to work in some capacity once he gets a better handle on his pain complaints."
[1985] Riley v. W.R. Grace [9/10/99] 1999 MTWCC 56 Attorneys fees must be awarded under a specific statutory provision. Section 39-71-613, MCA (1985) is not applicable to claim for attorneys fees following Declaratory Judgment action involving insurer's right to offset death benefits because the action did not involve a "hearing" as described within that statute. Fees are awarded under section 39-71-612, MCA (1985) because the dispute concerned "the amount of compensation due." The amount of attorneys fees is governed by section 39-71-614, MCA (1985), which awards fees based on the time spent by the attorney, not upon a contingency agreement.
[1991] Pattee v. Twin City Fire Ins. Co. [2/9/99] 1999 MTWCC 14 Where insurer agreed to send settlement checks within one week, but took three weeks, there was unreasonable delay. Claimant was not entitled to attorneys fees under section 39-71-612, MCA (1991), however, because that section requires a dispute over the amount of compensation due, which did not occur in this matter.
[1991] Pittsley v. State Fund [11/19/98] 1998 MTWCC 84 Where a claimant seeks penalty and attorneys fees following a grant of summary judgment turning interpretation of statutes, regulations, and case law, the question is whether the legal position taken by the insurer was unreasonable. In this case, important legal precedent was found by the Court's own research. It is difficult to find an insurer's legal position unreasonable when a claimant's attorney does not cite legal precedent to support his or her position. Attorneys fees and penalty denied.
[1995] McGillis v. State Fund [11/2/98] 1998 MTWCC 79 Attorney fees and penalty were awarded only with respect to the 10% wage loss (PPD benefits) which the insurer conceded at trial and should have conceded earlier based on the evidence.
[1981] Ranger Ins. Co. v. Bates [3/16/98] 1998 MTWCC 24 Under Madill v. State Compensation Ins. Fund, 280 Mont. 450, 930 P.2d 665 (1997) and section 39-71-612, MCA (1981), attorney fees were properly awarded to claimant with respect to all PTD benefits payable after the date on which she filed her petition for those benefits, even though hearing was not necessary. As in Madill, claimant demanded PTD benefits, her demand was refused, and the insurer ultimately conceded liability for those benefits. However, attorney fees are not properly awarded with respect to benefits which the insurer attempted to reduce through petition to the Court. Those benefits had already been paid, thus did not meet statutory criteria for allowing an award of attorneys fees.
[1995] Wall v. National Union Fire Ins. Co. [2/24/98] 1998 MTWCC 11 Penalty and attorneys fees are warranted based on the insurer's unreasonable denial of the claim, reflected in its failure to ascertain the IME physician's qualifications for the condition at issue, continued reliance on the IME physician's opinions despite information suggesting the treating physician was more qualified, denial of an OD claim in its entirety despite the IME physician's opinion 50% of the condition was occupational, and disregard for some facts and for the opinions of the nurse manager and treating physician.
[1995] Ardesson v. Legion Ins. [1/15/98] 1998 MTWCC 2 Attorneys fees awarded to claimant litigating inclusion of actual value of meals in wages for purposes of TTD benefit rate. While insurer had conceded liability for $3.00 per meal, a concession of liability is not an "offer" within section 39-71-612 cutting off liability for attorney's fees where the insurer did not pay the amount conceded and the concession was not implemented within 30 days as contemplated by section 39-71-612(2), MCA (1995). Insurer's delay and failure to pay conceded liability were unreasonable.
[1989] Stevens v. National Union Fire Ins. Co. of Pittsburgh [7/17/97] 1997 MTWCC 45 Despite the finding of unreasonable conduct, claimant was not entitled to attorneys fees or costs under sections 39-71-611 or -612, MCA (1989) where the claim for benefits was settled without an order of the workers' compensation court. See, Lasar v. E.H. Oftedal & Sons, 222 Mont. 251, 252, 721 P.2d 352 (1986); Yearout v. Rainbow Painting, 222 Mont. 65, 68, 719 P.2d 1258 (1986).
[1979] Madill v. State Compensation Insurance Fund [5/28/97] 1997 MTWCC 33 On remand following Supreme Court decision ordering award of attorneys fees, Workers’ Compensation Court refused to order attorneys fees on successful appeal to obtain attorneys fees where statute does not authorize such fees.
Caekaert v. State Compensation Ins. Fund [10/12/95] 1995 MTWCC 78 Costs in the Workers’ Compensation Court are not conditioned upon a finding of unreasonableness.
Robertson v. State Compensation Ins. Fund [01/23/95] 1995 MTWCC 4 Where insurer’s position on average weekly wage had support in the record, claimant, whose own position did not entirely prevail, was not entitled to attorneys fees on a theory of unreasonable insurer conduct. Affirmed in Robertson v. Aero-Power Vac, Inc. and Montana State Fund, 272 Mont. 85 (No. 95-089).