McMILLEN v McKEE CO

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No. 12805 I N THE SUPREME COURT OF THE STATE OF M N A A OTN 1975 JOHN McMILLEN , Claimant and Respondent, ARTHUR G. McKEE and COMPANY, Defendant and A p p e l l a n t . Appeal from: D i s t r i c t Court o f t h e Second J u d i c i a l D i s t r i c t , Honorable John B. McClernan, Judge p r e s i d i n g . Counsel of Record: For Appellant : Poore, McKenzie, Roth and Robinson, B u t t e , Montana James A. Robischon a r g u e d , and Donald C. Robinson a r g u e d , B u t t e , Montana F o r Respondent : Hon. R o b e r t L. Woodahl, A t t o r n e y G e n e r a l , Helena, Montana Lon J. Maxwell, A s s i s t a n t A t t o r n e y G e n e r a l , a r g u e d , Helena, Montana Norman H. G r o s f i e l d , S p e c i a l A s s i s t a n t A t t o r n e y G e n e r a l , a r g u e d , Helena, Montana C o r e t t e , Smith and Dean, B u t t e , Montana Kendrick Smith a r g u e d , B u t t e , Montana Submitted: March 4, 1975 M. J u s t i c e Frank r Haswell d e l i v e r e d t h e Opinion o f t h e Court Our o r i g i n a l opinion h e r e i n appearing i n 3 1 St.Rep. subsequently withdrawn. . 1026, w a s A r e h e a r i n g was g r a n t e d l i m i t e d t o t h i s question: "Does s e c t i o n 92-616, R.C.M. 1947, deny e q u a l p r o t e c t i o n , o f t h e laws t o t h e employer and defendant i n v i o l a t i o n o f Sec. 1 of t h e 1 4 t h Amendment t o t h e United S t a t e s Cons t i t u t i o n o r Sec. 17 ( s i c ) , A r t i c l e I1 of t h e Montana Constitution?" T h i s c o n s t i t u t e s t h e complete opinion o f t h i s Court on a l l i s s u e s of t h i s c a s e following r e h e a r i n g : This i s a c o n s o l i d a t e d appeal by t h e employer and i t s i n s u r e r from two judgments o f t h e d i s t r i c t c o u r t of S i l v e r Bow County, awarding workmen's compensation b e n e f i t s t o two i n j u r e d employees i n companion c a s e s . Claimants a r e John and Robert McMillen, employees of Arthur G. McKee & Company, a c o n t r a c t o r engaged on a job o f s m e l t e r i m - provement i n Anaconda, Montana, under a w r i t t e n c o n t r a c t . Defendant i s General Accident F i r e & L i f e Assurance Corporation, a p r i v a t e i n s u r a n c e company, t h e Plan I1 i n s u r e r of t h e McKee Company under t h e Montana workmen's Compensation Act. The u l t i m a t e i s s u e f o r review i s whether t h e employees were i n j u r e d i n t h e c o u r s e and scope of t h e i r employment s o a s t o e n t i t l e them t o workmen's compensation b e n e f i t s under t h e Montana Act. The Workmen's Compensation D i v i s i o n and t h e d i s t r i c t c o u r t h e l d t h e y were. W affirm. e The two McMillen b r o t h e r s l i v e d i n B u t t e and t r a v e l e d each workday t o and from t h e Anaconda job s i t e where t h e y had been employed f o r about two y e a r s . Each was p a i d $4 p e r day t r a v e l allow- ance under t h e terms of a union c o n t r a c t providing i n m a t e r i a l p a r t : ** "* T r a v e l pay o r s u b s i s t e n c e s h a l l be f o r days worked. The mileage and amount of t r a v e l pay o r s u b s i s t e n c e s h a l l be a s follows: *** "zero -----------------none m i l e s --------------$2.50 t o 12-1/2 miles "Over 12-1/2 t o 25 John McMillen purchased a used Dodge t r u c k t h r e e days b e f o r e the accident i n question. It had some 71,000 m i l e s on i t a t t h e time of purchase, b u t John t e s t i f i e d he c a r e f u l l y checked t h e c a r b e f o r e purchase and found i t s a f e . O Monday morning, J u l y 2 , 1973, t h e two McMillan b r o t h e r s n were s e r i o u s l y i n j u r e d i n a s i n g l e c a r a c c i d e n t w h i l e e n r o u t e t o work. Due t o some mechanical f a i l u r e of t h e Dodge t r u c k , t h e r e a r wheels locked, t h e t r u c k o v e r t u r n e d , and both McMillens were injured. The a c c i d e n t occurred on t h e highway between B u t t e and Anaconda b e f o r e t h e y reached t h e job s i t e . The cause of t h e a c c i d e n t was something o v e r which n e i t h e r t h e employees n o r t h e employer had any c o n t r o l . P r i o r t o t h e day of t h e a c c i d e n t , b o t h employees had been p a i d $4 p e r day f o r each day worked i n a d d i t i o n t o t h e i r wages. The amount p a i d was c a l l e d "the mileage and amount of t r a v e l pay o r subsistence". O t h e itemized breakdown a t t a c h e d t o t h e i r n checks, t h e r e i s a column headed " ~ u b s . ~ r a v e l i n which t h i s " payment was e n t e r e d . The employer d i d n o t deduct any t a x e s on t h i s t r a v e l pay, b u t each employee p a i d income t a x e s on t h e t r a v e l money. N e i t h e r employee r e c e i v e d any t r a v e l pay on t h e day of t h e accident. The c l a i m s of each employee were heard by t h e Workmen's Compensation Division. The D i v i s i o n e n t e r e d f i n d i n g s o f f a c t , c o n c l u s i o n s of law, and an o r d e r awarding compensation. The sub- s t a n c e o f t h e D i v i s i o n holding was t h a t t h e t r a v e l allowance was p a i d a s an i n c e n t i v e "to g e t t h e men t o come on t h e job" and a b e n e f i t t o t h e employer; t h a t a c c o r d i n g l y each s u f f e r e d an a c c i d e n t a l i n j u r y a r i s i n g o u t o f and i n t h e c o u r s e of h i s employment; and, t h a t each was e n t i t l e d t o b e n e f i t s under t h e Montana Act i n c l u d i n g compensation, medical expense and a t t o r n e y f e e s . On a p p e a l t o t h e d i s t r i c t c o u r t , t h e c a s e s were heard on t h e t h e r e c o r d b e f o r e t h e Workmen's Compensation Division w i t h o u t a d d i t i o n a l evidence. The d i s t r i c t c o u r t adopted t h e f i n d i n g s o f f a c t and c o n c l u s i o n s o f law o f t h e D i v i s i o n and e n t e r e d judgment a f f i r m i n g t h e D i v i s i o n award of b e n e f i t s . The employer and i n s u r e r now a p p e a l from t h e judgment o f the d i s t r i c t court. The i s s u e i s whether under t h e f a c t s and circumstances of t h i s c a s e t h e two employees s u f f e r e d a c c i d e n t a l t n j u r i e s II arising o u t of and i n t h e c o u r s e o f " t h e i r employment w i t h i n t h e meaning of ~ o n t a n a ' sWorkmen's Compensation Act. S e c t i o n 92-614, R.C.M. A review of some p r i o r d e c i s i o n s of t h i s Court on compensation coverage where an employee i s i n j u r e d II going o r coming" t o and from t h e job f u r n i s h e s t h e background f o r our d e t e r m i n a t i o n . 1 I n G r i f f i n v. I n d u s t r i a l Accident Fund, 1 1 Mont. 110, 106 P. 2d 346, compensation was denied a foreman i n j u r e d i n a f a l l on a c i t y sidewalk when r e t u r n i n g home from work. The b a s i s of d e n i a l was t h a t t h e sidewalk was n o t used by t h e employer i n c a r r y i n g on h i s b u s i n e s s i n which t h e employee was employed and consequently t h e employee was i n j u r e d o n l y by an o r d i n a r y s t r e e t hazard common t o a l l pedestrians. I n Morgan v. I n d u s t r i a l Accident Board, 133 Mont. 254, 260, 321 P.2d 232, c l a i m a n t , a union shop steward, was i n j u r e d i n an automobile a c c i d e n t w h i l e t r a v e l i n g from Miles C i t y t o Forsyth. I n denying compensation, t h i s Court pointed o u t t h a t a t t h e time o f i n j u r y c l a i m a n t was on union b u s i n e s s and n o t w i t h i n t h e scope of h i s employment. The Court l a i d down t h i s p r i n c i p l e : "Under t h e p a r t i c u l a r circumstances, where t h e a c c i d e n t occurred i s i r r e l e v a n t . I f claimant was i n j u r e d w i t h i n t h e scope of h i s employment, t h e f a c t t h a t he was i n j u r e d ' a f t e r h o u r s ' and I o f f r e m i s e s ' i s i n c i d e n t a l . Even i n ' s t r e e t risks', t h e scope, n o t t h e p l a c e of employment c o n t r o l s . I1 Guarascio v. I n d u s t r i a l Accident Board, 140 Mont. 497, 501, 374 P.2d 84, granted compensation where an i t i n e r a n t t e r r a z z o t i l e worker r e s i d i n g i n S a l t Lake C i t y was k i l l e d i n an automobile a c c i d e n t enroute from Utah t o Butte, Montana t o a i d i n c o n s t r u c t i o n of a h o s p i t a l t h e r e . A t t h e time of t h e a c c i d e n t Guarascio was being paid a , t r a v e l pay allowance based upon h i s hourly r a t e of pay m u l t i p l i e d by t h e number o f hours necessary t o t r a v e l from S a l t Lake C i t y t o B u t t e , p l u s an allowance f o r s u b s i s t e n c e and t r a n s portation costs. I n Guarascio a f t e r f i n d i n g "an informal, o r a l type of employment", t h i s Court l a i d down t h e t e s t of compensability i n "going and coming1 c a s e s i n terms of whether some reasonably immediate s e r v i c e t o t h e employer was involved: "1n t h e i n s t a n t c a s e , t h e decedent Guarascio was c a r r y i n g on t h e b u s i n e s s of h i s employer by t r a n s p o r t i n g himself t o B u t t e , Montana, s o t h a t he could be on t h e job a s soon a s p o s s i b l e . Furthermore, t h e employer recognized t h e b e n e f i t t o i t by v i r t u e of t h e f a c t t h e decedent workman was t o r e c e i v e monetary compensation f o r t h e time spent t r a v e l i n g t o t h e job. I n Morgan v. Ind. Acc.Bd., 133 Mont. 254, 321 P.2d 232, t h i s Court made t h e following observation: 11 What i s t h e underlying p r i n c i p l e ? I n c a s e s where some reasonably immediate s e r v i c e t o t h e employer can be discerned t h e c l a i m has been s u s t a i n e d . Where t h e r e has been no reasonably immediate s e r v i c e t h e c l a i m has been denied. Such impresses u s a s a fundamental r u l e and guide f o r t h e l i b e r a l i t y t o which t h i s Court i s n e c e s s a r i l y and properly committed and f o r which c l a i m a n t ' s counsel s o e a r n e s t l y contend. [ C i t i n g a u t h o r i t y ] . Beyond t h i s each d e c i s i o n must be cont r o l l e d by t h e p a r t i c u l a r f a c t s and circumstances of t h e p a r t i c u l a r case. [ C i t i n ? a u t h o r i t y ] . Our opinion proceeds upon t h a t premise. 11 I h he r e c o r d h e r e s u b s t a n t i a t e s t h e f i n d i n g s of t h e d i s t r i c t c o u r t , b u t we wish t o a a i n s t a t e , a s w e d i d i n t h e Morgan c a s e , t h a t we do n o t i n t e n a t o Our d e c i s i o n i s l i m i t e d e s t a b l i s h any precedent t o t h e f a c t s i n t h e c a s e now b e f o r e us. 111 * * *. F The employer and i n s u r e r contend t h a t Guarascio i s d i s t i n g u i s h a b l e on t h e b a s i s t h a t t h e r e t h e employee was paid h o u r l y wages f o r h i s t r a v e l time i n a d d i t i o n t o s u b s i s t e n c e and t r a v e l c o s t s i n d i c a t i n g t h a t t h e t r a v e l involved was f o r t h e b e n e f i t of h i s employer. They contend t h a t t h e method of payment i s c r u c i a l t o determination of b e n e f i t t o t h e employer, which c o n t r o l s compensability. W disagree. e Although b e n e f i t t o t h e employer i s an important f a c t o r i n determining compensability, t h e payment of hourly wages f o r t r a v e l time i s n o t n e c e s s a r i l y a u n i v e r s a l condition precedent. I n t h e i n s t a n t c a s e , t h e union c o n t r a c t s i n g l e d out f o r s p e c i a l c o n s i d e r a t i o n a t r a v e l allowance and testimony a t t h e hearing i n d i c a t e d i t was paid a s an i n c e n t i v e t o g e t men out on t h e job. This c o n t r a c t u a l f a c t supports t h e f i n d i n g of t h e Division and t h e d i s t r i c t c o u r t t h a t t h e t r a v e l allowance was f o r t h e b e n e f i t of t h e employer w i t h i n previous holdings of t h i s Court. This i s c o n s i s t e n t with t h e majority r u l e i n t h e United S t a t e s t h a t a workman i s u s u a l l y e n t i t l e d t o compensation when i n j u r e d during t r a v e l t o o r from h i s employment where he r e c e i v e s a s p e c i f i c allowance t o g e t t o and from h i s job. t i o n Law, 5 16.20 e t seq. 1 Larsen, workmen's Compensa- 1 Larsen, workmen's Compensation Law, 5 16.30, p. 4-112, summarizes t h e p r i n c i p l e and i t s r a t i o n a l e : 11 However, i n t h e majority of c a s e s involving a d e l i b e r a t e and s u b s t a n t i a l payment f o r t h e expense of t r a v e l , o r t h e provision of an automobile under t h e employee's c o n t r o l , t h e journey i s held t o be i n t h e course of employment. This r e s u l t i s u s u a l l y c o r r e c t , because when t h e subj e c t of t r a n s p o r t a t i o n i s s i n g l e d out f o r s p e c i a l c o n s i d e r a t i o n i t i s normally because t h e t r a n s p o r t a t i o n involves a considerable d i s t a n c e and t h e r e f o r e q u a l i f i e s under t h e r u l e h e r e i n suggested: t h a t employment should be deemed t o include t r a v e l when t h e t r a v e l i t s e l f i s a s u b s t a n t i a l p a r t of t h e s e r v i c e performed. The sheer s i z e of t h e journey i s f r e q u e n t l y t h e p r i n c i p a l f a c t supporting t h i s conclusion, a s i n t h e s u c c e s s f u l c a s e s involving t r i p s of e i g h t m i l e s , 20 miles, 22 miles, 30 miles, 50 miles, 54 miles, 60 miles, 120 m i l e s , and 130 miles. If The employer and i n s u r e r a l s o argue t h a t t h e union c o n t r a c t providing f o r a t r a v e l allowance i s i r r e l e v a n t t o compensability because t h e meaning of t h e phrase " a r i s i n g o u t of and i n t h e course of employment" must be determined by t h e r u l e s of s t a t u t o r y construction. They f u r t h e r contend t h a t employers and employees can n o t c o n t r a c t themselves i n and out of coverage under t h e Workmen's Compensation Act by t h e terms of a union c o n t r a c t . This contention i s specious, be i n t e r p r e t e d i n a vacuum. The s t a t u t o r y language can n o t It must be i n t e r p r e t e d i n t h e context of t h e f a c t s of t h e p a r t i c u l a r case before t h e c o u r t . c o n t r a c t providing f o r t r a v e l allowance i s a f a c t . t r a v e l allowance i s another f a c t , The union Payment of t h e The purpose of payment t o provide an i n c e n t i v e t o g e t t h e employees on t h e job i s a t h i r d f a c t . b e n e f i t t o t h e employer i s a f i n a l f a c t . The The s t a t u t o r y language i s simply a p p l i e d t o t h e s e f a c t s and t h e meaning determined. W have considered a l l t h e c a s e s , s t a t u t e s and a u t h o r i t i e s c i t e d e by counsel. W e hold t h a t t h e employees h e r e were i n j u r e d i n an a c c i d e n t " a r i s i n g out of and i n t h e course of employment" and t h e i r i n j u r i e s a r e t h e r e f o r e compensable. Our d e c i s i o n i s l i m i t e d t o t h e f a c t s of t h e case b e f o r e us. The employer and i n s u r e r a l s o r a i s e t h e i s s u e of t h e c o n s t i t u t i o n a l i t y of s e c t i o n 92-616, R.C.M. 1947, which provides, i n per- tinent part: "In t h e event t h e i n s u r e r denies t h e claim f o r compensation o r terminates compensation b e n e f i t s , and t h e claim i s l a t e r adjudged compensable, by t h e d i v i s i o n o r on appeal, t h e i n s u r e r s h a l l pay reasonable c o s t s and a t t o r n e y s ' f e e s a s e s t a b l i s h e d by t h e d i v i s i o n * * *." The employer and i n s u r e r contend t h i s s t a t u t e denies equal p r o t e c t i o n of t h e laws i n v i o l a t i o n of t h e United S t a t e s and Montana constitutions. Two s p e c i f i c v i o l a t i o n s a r e a l l e g e d : 1 ) Allowing c o s t s and a t t o r n e y s ' f e e s t o s u c c e s s f u l claimants, b u t not t o s u c c e s s f u l i n s u r e r s , . . 2) Requiring payment of c o s t s and a t t o r n e y s 1 f e e s i f t h e s u c c e s s f u l claimant i s covered under Plans 2 o r 3 ( p r i v a t e insurance company and t h e s t a t e fund), b u t n o t i f he i s covered under Plan 1 (self -insurers). There i s ample a u t h o r i t y supporting t h e c o n s t i t u t i o n a l i t y of Montana's Workmen's Compensation Act a s a v a l i d e x e r c i s e of t h e state's police power. Cunningham v. Northwestern Improvement Co., 44 Mont. 180, 119 P. 554. Here our concern is whether or not, in exercising that police power, the legislature has violated constitutional guarantees of equal protection of the laws. The argument that insurers should be able to recover attorneys' fees when they prevail, in order to satisfy equal protection provisions, is not supported by any discoverable authority. To the contrary, the United States Supreme Court in Missouri, Kansas & Texas Railway of Texas v. Cade, 233 U.S. 642, 34 S.Ct. 678, 58 L.Ed. 1135, 1138;1139, held: I I If the classification is otherwise reasonable, the mere fact that attorney's fees are allowed to successful plaintiffs only, and not to successful defendants, does not render the statute repugnant to the 'equal protection' clause.* * * '* I * *The outlay for an attorney's consequence of the litigation, and upon one party or the other, it is it upon the party whose refusal to renders the litigation necessary. 1 1 fee is a necessary since it must fall reasonable to impose pay a just claim That holding has remained unchanged for over sixty years and controls the federal constitutional question here. For the same reasons, we hold that there is no violation of the equal protection clause in Article 11, Section 4, Montana Constitution. The second argument raised under federal and state equal protection clauses arises from an improper construction of section 92-616, R.C.M. 1947. The employer and insurer argue that section 92-435, R.C.M. 1947, defining an "insurer", controls the applicability of section 92-616. They argue that these sections, when read together, unlawfully discriminate against Plan 2 and Plan 3 employers and insurers by requiring them to pay costs and attorneys' fees while exempting Plan 1 employers. This argument ignores the provisions of section 92-401, R.C.M. 1947, which provide that statutory definitions will control unless the context otherwise requires. The context here requires that section 92-616 covers employers and insurers under all three plans. This conclusion is compelled by a number of considerations. First, if a statute is capable of two constructions, it is the duty of this Court to give the statute that construction which will make it constitutional. School District No. 12 v. Pondera County, 89 Mont. 342, 297 P. 498; Parker v. County of Yellowstone, 140 Mont. 538, 374 P.2d 328. Second, in the context of the legislative act (Ch. 477, Laws of 19731, it is clear the legislature intended that the challenged provisions apply to all three compensation plans. That legislative enactment began with the words "Every insurer under any plan the payment of workmen's compensation benefits supplied). ** for (Emphasis *.It The use of the word "insurer" throughout the remainder of the act (including what is codified as section 92-616) should be construed as referring to insurers I Iunder any plan" --- Plans 1, 2 or 3, as the context does not otherwise require. Employers are their own I1insurers" under Plan 1 . Finally, section 92-838, R.C.M. 1947, requires that the provisions of the workmen ' Compensation Act be liberally construed. s The construction employed in this opinion is in accord with the spirit of that Act, providing the employee with compensation undiminished by the expenses of seeking legal remedies when he is wrongfully denied compensation benefits. The judgment of the district court is affirmed. Justice Mr. Justice Wesley Castles dissenting in part and concurring in part: I dissent as to what the majority calls the ultimate issue. The accident did not arise out of and in the course of employment. Whether it be travel allowance or subsistence or any other negotiated fringe benefit, does not make it in the course of employment as far as industrial accidents are concerned. I concur on the issue of constitutionality of section 92-616, R.C.M. 1947. ---dr2-;----------,----------- Justice.

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