in Murer et al. v. Montana State Fund et al., 283 Mont. 210
(1997) (Murer III)
ORDER DENYING ATTORNEY FEES UNDER COMMON FUND
After successful litigation establishing right of claimants
to increase in benefit rate due to expiration of cap on
compensation benefits in 1987 and 1989 Acts, attorneys for
claimant argued the litigation had established a common fund
requiring insurers to increase benefits of all impacted
claimants and pay them attorneys fees on benefit increase for
Request for attorneys fees with respect to benefits obtained
for non-party claimants is denied.
commenced this action seeking an increase in the rate of
disability benefits payable to them subsequent to June 30,
1991. At the time of their injuries, subsection (3) of
section 39-71-701, MCA (1987) and (1989), provided a general
cap on benefits:
(3) Weekly compensation benefits for an injury producing
temporary total disability shall be 66 2/3% of the wages
received at the time of the injury. The maximum
weekly compensation benefits may not exceed the state's
average weekly wage at the time of injury. . . .
subsection (5) of the same section provided a more specific
cap with respect to the time period July 1, 1987 through June
30, 1991, providing:
(5) Notwithstanding subsection (3), beginning July 1, 1987,
through June 30, 1989, , weekly compensation benefits
for temporary total disability may not exceed the state's
average weekly wage of $299 established July 1, 1986.
caps were applicable to permanent total and permanent partial
disability benefits. §§ 39-71-702(6) and -703(3),
MCA (1987) and (1989).
and the respondent insurers interpreted the caps differently.
The insurers relied on the usual rule that the law in effect
at the time of the injury governs the payment of benefits,
Buckman v. Montana Deaconess Hospital, 224 Mont.
318, 730 P.2d 380 (1986), and interpreted the subsection (5)
cap as applying to all benefits payable with
respect to injuries occurring between July 1, 1987 and June
30, 1991. Petitioners interpreted the subsection as applying
only to benefits paid during that specific period of time.
For a claimant injured between July 1, 1990 and June 30,
1991, the maximum amount at stake is $24 a week, which is the
difference between the $299 cap specified in subsection (5)
and the state's fiscal year 1991 average weekly wage of
prevailed in Murer v. State Compensation Mut. Ins.
Fund, 267 Mont. 516, 885 P.2d 428 (1994) (Murer
II), and established a legal precedent that entitles
many of the other claimants who were injured between July 1,
1987 and June 30, 1991, to increased benefits.
Petitioners' attorneys now ask the Court to award
attorney fees with respect to additional amounts that may be
due those other claimants as a result of the precedent. In
conjunction with their request, they have notified the only
remaining respondent,  State Compensation Insurance Fund, that
they claim a lien on all amounts payable as a result of the
decision in Murer II.
attorneys concede that they have no attorney fee agreement
with the affected claimants from whose benefits the requested
fees would be paid. They also agree that they have no
statutory entitlement to such fees. Rather, they argue that
their entitlement is an equitable one arising under common
fund and/or substantial benefit doctrines.
present claim for fees surfaced shortly after remand
following Murer II. One of the initial issues raised
regarding the claim is what notice, if any, should be given
to claimants who may be affected by the claim.
Petitioners' attorneys argued that all potentially
affected claimants must be given notice. The Court asked for
case citations supporting their contention. After reading
some of the cases brought to my attention, I decided to ask
the parties to brief the merits of the claim. If the claim is
without merit, then no further notice is necessary. If the
claim appeared to have merit, I could then determine what
further notice should be given.
I granted a motion to intervene filed by a few of the
potentially affected claimants. I also permitted two insurers
-- Liberty Mutual and Liberty Northwest -- to intervene. Both
interventions were limited to the attorney fee issue. Since
the intervening insurers do not have a direct stake in the
dispute, their participation shall be treated as in the
nature of amicus curiae.
Fund and Substantial Benefit Doctrines
traditional American rule ordinarily disfavors the allowance
of attorneys' fees in the absence of statutory or
contractual authorization . . . ." Hall v.
Cole,412 U.S. 1, 4-5 (1974); accord, Fleischmann
Corp. v. Maier Brewing,386 U.S. 714, 717 (1967);
Alyeska Pipeline Co. v. Wilderness Society, 421 U.S.
240, 247 (1975). Montana follows the American rule. In re
Dearborn Drainage Area, 240 Mont. 39, 42, 782 P.2d 898,
899 (1989). It has "consistently adhered to the
principle that in the absence of some special agreement
between the parties or statutory authorization ...