                                              No.    81-12

                      I N THE SUPREME COURT OF THE STATE OF MONTANA

                                                     1981




STATE O F MONTANA, ex r e l . ,            CROCKETT
S. HARRY,

                                 Petitioner,



D I S T R I C T COURT OF THE NINTH J U D I C I A L
D I S R I C T O F THE STATE OF MONTANA, I N
AND FOR THE COUNTY O F GLACIER, e t a l . ,

                                 Respondents.




O R I G I N A L PROCEEDING:


C o u n s e l of R e c o r d :

          For P e t i t i o n e r :

                       John P. M o o r e a r g u e d , C u t B a n k , M o n t a n a


          For R e s p o n d e n t :

                       J a m e s C. N e l s o n argued, C o u n t y A t t o r n e y , C u t B a n k ,
                       Montana
                       M a r k Murphy a r g u e d , A s s t . A t t y . G e n e r a l , H e l e n a ,
                       Montana




                                              Submitted:         A p r i l 20,   1981

                                                 Decided :     1AR/ 2 6 1981


Filed:
             MAY 2 6 1961
Mr. Justice Gene B. Daly delivered the Opinion of the Court.
        This is an original proceeding wherein the petitioner
seeks a writ of prohibition or other appropriate relief.
Petitioner requests the relief from this Court in an attempt
to   vacate   and      annul    certain   orders   of    the    respondent,
Glacier County District Court, made and entered on November
17, 1980,     in the      case    of    State v.   Crockett      S.    Harry,
District Court Cause No. DC 80-24.             After a hearing on the
petition, the Court issues the following opinion.
        In September 1979 petitioner Crockett S. Harry was
injured in an industrial accident, entitling him to workers'
compensation benefits.          A lump sum settlement was eventually
received from the State Workers' Compensation Division by
petitioner        on   June    10,     1980.   The      proceeds      of   the
settlement, amounting to $7,000, were deposited with the
First National Bank in Cut Bank, Montana.                  The money has
remained on deposit with the bank throughout this proceeding
and has never been commingled with any other funds.
        On November 2, 1980, petitioner was                    arrested     and
charged with deliberate homicide.              He appeared with court-
appointed counsel for arraignment on November 5, 1980.                     Upon
interviewing petitioner, the District Court learned of the
$7,000 certificate of deposit and, as a result, found that
petitioner        was not      indigent and    could employ his own
attorney.     The court advised petitioner to retain private
counsel and that, if he chose to keep his court-appointed
attorneys, he would be required to defray the costs of their
appointment   .
        Petitioner, on November 17, 1980, again appeared with
appointed counsel and advised the District Court that he was
unable to find an attorney who would take his case.                        The
District Court         at   this time allowed           for petitioner's
continued representation by appointed counsel but with the
proviso that he utilize the $7,000 certificate of deposit to
reimburse Glacier County, Montana, for the fees and costs
incurred in his defense.             The court then issued an order
directing the Cut Bank First National Bank not to cash the
$7,000 certificate of deposit and ordering petitioner not to
assign, hypothecate, pledge or in any manner liquidate the
certificate without further order of the court.
         On December 15, 1980, petitioner filed a motion to
quash.     The grounds for the motion were: (1) the order was
made without any notice or opportunity to be heard; and (2)
the $7,000 workers' compensation settlement is totally
protected from any attachments, garnishments, assignments or
debts.      The     District Court denied         the motion,        and    the
petition for relief was filed with this Court. Petitioner
now seeks to vacate and annul the District Court's order
seeking the $7000 certificate of deposit                    to be used       to
reimburse Glacier County          for the costs of his appointed
counsel.
         The main      thrust of petitioner's           argument     is that
workers'        compensation   funds    are    exempt      from   being    held
liable     in    any manner    for     the    debts   of    the   recipient.
Section 39-71-743, MCA,          is pertinent in this regard and
provides as follows:
         "Assignment or attachment of payments.   No
         payments under this chapter [the Workers'
         Compensation Act] shall be assignable,
         subject to attachment or garnishment, or be
         held liable in any way for debts."
         This section has yet to be interpreted by this Court.
We   now c o n c l u d e ,       however,         that    t h e provided            exemption              is
absolute,         allowing a blanket protection                           a g a i n s t claims of
e v e r y k i n d , i n c l u d i n g t h e one a t i s s u e .

           The      underlying           purpose         and    objective            of       workers'
compensation            legislation          is    to     insure       the       injured        worker
that     he      will     be     compensated             for   disabilities               caused           by

industrial          accidents          which,       when       added        to     his    remaining
e a r n i n g a b i l i t y , w i l l e n a b l e him t o f u n c t i o n w i t h o u t b e i n g a
burden t o o t h e r s .          S e e Mahlum v .         Broeder          ( 1 9 6 6 ) , 1 4 7 Mont.

386,      412        P.2d        572;      1      Larson,           T h e Law o f W o r k m e n ' s
C o m p e n s a t i o n , B 2.50 a t 11 ( 1 9 7 8 ) .

           I n a c c o r d a n c e w i t h t h i s o b j e c t i v e and t o a s s u r e i t s
maximum          benefit         for     the      injured           worker,         the        Montana

legislature           has      specifically          provided          that        payment           of     a
workers'         c o m p e n s a t i o n award s h a l l b e exempt f r o m a l l f o r m s
of    seizures.             If    this     exemption           is    to     now b e       liberally

construed         i n favor       of     t h e worker,         a s mandated              by    section
39-71-104,         MCA,     i t m u s t b e g i v e n e f f e c t a s w r i t t e n , and t h e

e x e m p t i o n m u s t be deemed c o m p l e t e .
           Respondent a r g u e s t h a t t h e exemption does n o t extend
t o governmental             e n t i t i e s s e e k i n g t o r e c o v e r p u b l i c monies

expended t o s u p p o r t t h e i n j u r e d worker.                 W e acknowledge t h a t

t h i s p o s i t i o n h a s b e e n u p h e l d i n o t h e r j u r i s d i c t i o n s on t h e
r a t i o n a l e t h a t g o v e r n m e n t a l e n t i t i e s s h o u l d be g r a n t e d t h e
s t a t u s of     an    "extraordinary"             creditor          so     as    to        keep        the
i n j u r e d w o r k e r f r o m becoming a p u b l i c c h a r g e .              See S t a t e v.
Coburn ( I o w a 1 9 8 0 ) , 294 N.W.2d              5 7 ; McDougald v , N o r t o n ( D . C .
Conn.     1 9 7 3 ) , 361 F.Supp.            1325.         The c i t e d c a s e s ,          however,
a r e not controlling,                 and w e r e j e c t t h e i r        application.                  We
h o l d t h a t t h e s t a t u t o r y e x e m p t i o n i s t o t a l as t o a n y and a l l
creditors, including a county governmental entity seeking to
recover funds expended for a defendant's appointed counsel.
      A    writ   of   prohibition   is   hereby   granted,   and   the
District     Court's    order   seizing     the    proceeds   of    the
petitioner's workers' compensation award is vacated.




We concur:



    Chief Justice
Mr.   Chief J u s t i c e Frank I. Haswell, s p e c i a l l y c o n c u r r i n g :
           I concur i n the r e s u l t .

           I n my v i e w t h e o r d e r o f t h e D i s t r i c t C o u r t d i r e c t i n g t h e

F i r s t N a t i o n a l Bank n o t t o c a s h t h e $ 7 , 0 0 0 c e r t i f i c a t e of d e p o s i t
and o r d e r i n g r e l a t o r n o t t o a s s i g n , h y p o t h e c a t e , p l e d g e o r
l i q u i d a t e t h e c e r t i f i c a t e m u s t be v a c a t e d and s e t a s i d e .        Relator

was d e n i e d p r o c e d u r a l due p r o c e s s by e n t r y o f t h i s o r d e r w i t h o u t
n o t i c e and an o p p o r t u n i t y t o a p p e a r and c o n t e s t t h e o r d e r .



                                                ------------
                                                Chief J u s t i c e
