                                                No.    88-186

                    I N THE SUPREME COURT O F THE STATE O F MONTANA




R I T A GOULD,
                      C l a i m a n t and R e s p o n d e n t ,
          -vs-

COUNTY MARKET/SUPER VALU S T O R E S ,
                      Employer,
          and
L I B E R T Y MUTUAL F I R E INSURANCE COMPANY,

                      Defendant and Appellant.




A P P E A L FROM:     T h e Workers' C o m p e n s a t i o n C o u r t , T h e H o n o r a b l e
                      T i m o t h y R e a r d o n , Judge p r e s i d i n g .

COUNSEL O F RECORD:

          For A p p e l l a n t :
                                                                                   ~OS-=
                      Garlington,          Lohn & Robinson;              Larry               Missoula,
                      Montana

          For Respondent:

                      Linnell,       Newhall & Martin;               R i c h a r d J. Martin, G r e a t
                      Falls, Montana




                                                      S u b m i t t e d on B r i e f s :   July 21,   1988

                                                         Decided:          Septefnber 8, 1988




                                    A~L
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                                                      clerk
The symptoms persisted, rendering Gould temporarily totally
disabled.
     The Workers' Compensation Court appointed a Hearing
Examiner for Gould's claim. The examiner held a hearing at
which testimony was taken and evidence introduced. He subse-
quently issued his Findings of Fact and Conclusions of Law
and Proposed Judgment. He denied Gould's claim on the ground
that she had failed to notify her employer of her injury
within 60 days as required by S 39-71-603, MCA (1985). The
Hearing Examiner's proposed judgment was adopted by the court
in an order issued the same day as the proposed judgment.
The court's order also stated that any party to the dispute
would have 20 days to request a rehearing.
     Gould timely filed her Motion For New Trial, in which
she alleged that the Hearing Examiner did not consider two
items of evidence she considered crucial. Gould pointed to a
handwritten memo by the store manager in which he noted
suggesting to Gould that she begin her retirement if working
conditions at the store were detrimental to her health. She
also cited an insurance claim form signed by Gould and the
store manager on which Gould had answered "yes" to the ques-
tion, "Is illness or injury due to Claimant's occupation?"
Both documents were dated within 60 days of the date of
Gould's injury, and she contended that they provided actual
notice to her employer of her injury and its relation to her
employment. The court granted Gould's motion in its order of
March 16, 1988:

    These two written notices are sufficient to estab-
    lish that actual notice was given to the employer
    within 60 days, as required by Section 39-71-603,
    MCA .
        The Court concludes that it erred in not recog-
    nizing the two written statements in evidence cited
    by claimant which do establish notice and that
Mr. Justice R.   C. McDonough delivered the Opinion of the
Court.

     Liberty Mutual Fire Insurance Company (Liberty) appeals
from the order of the Workers' Compensation Court of the
State of Montana granting plaintiff Rita Gould's motion for a
new trial. We affirm.
     Liberty frames four issues for review by this Court:
     1. Whether the grounds on which the Claimant based her
motion for a new trial were insufficient as a matter of law
to allow the Workers' Compensation Court to grant a new
trial.
     2. Whether the Workers' Compensation Court Judge may
grant a new trial by reversing his Hearing Examiner's find-
ings of fact.
     3. If the Worker's Compensation Court Judge may grant a
new trial by reversing his Hearing Examiner's findings of
fact, then may he do so by substituting his judgment for that
of his Hearing Examiner's of the credibility (i.e. competen-
cy) of a witness whose demeanor and character his Hearing
Examiner has observed and judged but who he, the Workers'
Compensation Court Judge, has never observed.
     4. Whether the Claimant complied with the 60-day notice
requirement of § 39-71-603, MCA (1985).
     On September 8, 1986, Rita Gould filed a Petition For
Hearing in the Montana Workers' Compensation Court.      She
alleged her preexisting conditions of cervical and lumbar
spondylosis had been aggravated in the course of her employ-
ment, leading to an incident on May 26, 1985, when she expe-
rienced dizziness and severe neck, shoulder and back pain
while at work. According to Gould's petition, the incident
was a "culmination of symptoms" related to her employment.
     manifest injustice would be done if claimant were
     not granted a rehearing.
This appeal followed.
     Our review of the record and relevant authorities indi-
cates that the four issues framed by Liberty can be restated
as one. What is really at issue in this appeal is whether
the Workers' Compensation Court Judge can order a new trial
on the ground that the Hearing Examiner apparently disre-
garded or was not aware of pieces of evidence that were
crucial to the case. We hold that the judge has that power.
     Both parties acknowledge the court's ability to grant a
new trial under rules 2.52.340 and 2.52.344 of the Adminis-
trative Rules of Montana. The parties disagree, however, on
the propriety of the court's grounds for granting a new trial
in this case.
     Liberty sets out two inconsistent arguments that suffi-
cient grounds for a new trial do not exist. The first argu-
ment states the decision was improper under sections of the
civil procedure code. The second argument is based on rules
of administrative procedure.     The inconsistency of these
positions is symptomatic of the unique position occupied by
the Workers' Compensation Court. On one hand, the Workers'
Compensation Court is not a full-fledged District Court. Its
jurisdiction is limited to workers' compensation matters, and
its procedures are less formal. For example, 5 39-71-2903,
MCA (1985), states that the Montana Administrative Procedure
Act (MAPA) applies to the court's proceedings, while the
rules of evidence do not.    On the other hand, the court's
decisions are something more than administrative agency
decisions.    Agency decisions are normally appealable to
District Court, but $ 39-71-2904, MCA (1985), provides that
decisions of the Workers' Compensation Court are appealed
directly to this Court. Liberty's reliance on both civil and
administrative procedure is thus warranted. Both arguments
are supported by authority from this Court.      However, the
focus of Liberty's argument is misplaced.
     We note that both of Liberty's arguments are premised on
the limited power of the Workers' Compensation Court to
review oral testimony. Liberty seeks to take advantage of
this limited power of review by casting Gould's motion as a
disagreement with the weight given her own testimony before
the Hearing Examiner.     This is a mischaracterization of
Gould's argument, which is based on two written documents in
evidence before the examiner.    In addition to granting the
power to order a new trial, 2.50.340, ARM, requires that the
court conduct its review on the basis of the complete record,
with its decision based on the evidence as a whole. Liber-
ty's premise is thus faulty, and its arguments proceed on a
tangent concerning the credibility and demeanor of witnesses
that bears little relation to the issue at hand.
     Liberty's first argument suffers as a result of this
faulty premise. Relying on our decision in Walter v. Evans
Products Co. (1983), 207 Mont. 26, 672 P.2d 613, Liberty
asserts that the authority of the Workers' Compensation Court
to grant a new trial is governed by the general civil proce-
dure standards in ss 25-11-102 and 103, MCA (1985):
    The former verdict or other decision may be vacated
    and a new trial granted on the application of the
    party aggrieved for any of the following causes
    materially affecting the substantial rights of such
    party:
      1) irregularity in the proceedings of the court,
      ury, or adverse party or any order of the court or
      .buse of discretion by which either party was
     prevented from having a fair trial;
     ...
     (3) accident or surprise which ordinary prudence
     could not have guarded against;
       (4) newly discovered evidence material for the
       party making the application which he could not,
       with reasonable diligence, have discovered and
       produced. at trial;
       .. .
       Section 25-11-102, MCA (1985).
       No new trial may be granted in cases tried by the
       court without a jury, except on the grounds men-
       tioned in subsections    (1), ( 3 ) , and (4) of
       25-11-102.
       Section 25-11-103, MCA (1985).

According to Liberty, none of these grounds were argued by
Gould in her motion, nor are any presented by the record of
this case.  Rather, Liberty asserts that Gould merely dis-
agreed with the court as to the weight and relevance of her
own testimony.
     Liberty relies on Walter for the proposition that dis-
agreement with the weight given to testimony is an insuffi-
cient ground for a new trial as a matter of law. However,
the Walter decision did not turn on the review of oral testi-
mony. The party seeking a new trial in that case argued (1)
the court should have reopened the case to consider newly
discovered evidence, and (2) there was a complete lack of
probative, credible evidence in the record to support a
number of the court's findings. Walter, 672 P.2d at 616.
       When we reviewed the Walter decision, we looked to
§§   25-11-102 and 103, MCA (1985), as the most directly appli-
cable guide on the question of newly-discovered evidence.
The issue turned on the fact that the moving party had custo-
dy of the evidence in question. In contrast with Walter, the
question in this case is whether the examiner's proposed
decision was actually contrary to evidence in the record.
The question of newly-discovered evidence is not presented,
and the civil procedure statutes cited by Liberty are not
applicable.
        Liberty's second argument looks to the provisions of
MAPA.      Liberty points out that the Division of Workers'
Compensation is an administrative agency, and that under our
decision in Hock v. Lienco Cedar Products (Mont. 1981), 634
P . 2 d 1174, 38 St.Rep. 1598, the rules of civil procedure are
not directly applicable to the Workers' Compensation Court.
Liberty asserts that under MAPA--specifically S 2-4-621, MCA
(1985)--the Workers' Compensation Court Judge "sits in a form
of appellate review of his hearing examiner's proposed deci-
sion," and is limited in his review of the hearing examiner's
findings of fact.       In relevant part, the statute states:

     The agency in its final order may reject or modify
     the conclusions of law and interpretation of admin-
     istrative rules in the proposal for decision but
     may not reject or modify the findings of fact
     unless the agency first determines from a review of
     the complete record and states with particularity
     in the order that the findings of fact were not
     based upon competent substantial evidence or that
     the proceedings on which the findings were based
     did not comply with essential requirements of law.
Section 2-4-621 (3), MCA (1985).    Liberty also notes that
2.52.340, ARM, contains a similar standard:

     Findings of fact made by a hearing examiner will
     not be rejected or revised unless the Court first
     determines from a review of the complete record and
     states with particularity in the order that the
     findings of fact were not based upon competent
     substantial evidence.. .
2.52.340 (3)(a), ARM.   Liberty argues that under these stan-
dards, it should have been impossible for the court to grant
Gould's motion.  According to Libertv, the decision in this
case required the court to substitute its judgment for that
of the examiner as to the weight given to testimony of
witnesses at the hearing.
     As with its first argument, Liberty's application of
MAPA suffers from the mistaken premise that only Gould's oral
testimony was before the Workers' Compensation Court. Liber-
ty is correct in its assertion that the judge in this case
sat in a form of review of the examiner's proposed decision.
However, Liberty's focus on the standard of review exercised
by agencies under § 2-4-621, MCA (1985) is inappropriate. As
we stated above, the procedure in the Worker's Compensation
Court is not the same as that followed by an agency. We have
previously noted this fact when distinguishing case authority
dating from before the court's creation.
    [The party's] principal case was handed down before
    the Worker's Compensation Court was established.
    At the time of that case, the division conducted
    - - contested case hearings - - other
    its own                             like all
    agency~ .
Hock, 634 P.2d at 1178 (emphasis added). While the Workers'
Compensation Court is not a full-fledged District Court,
§§ 39-71-2901 through 39-71-2909, MCA (1985), grant the court

authority broader than that exercised by an agency:
    Although the Workers' Compensation Court is not
    vested with the full powers of a District Court, it
    nevertheless has been given broad powers concerning
    benefits due and payable to claimants under the
    Act. It has the power to determine which of sever-
    al parties is liable to pay the Workers' Compensa-
    tion benefits, or if subrogation is allowable, what
    apportionment of liability may be made between
    insurers, and other matters that go beyond the
    minimum determination - - benefits payable - -
                          of the                  to an
    employee.
State ex rel. Uninsured ~mployers'Fund v. Hunt (~ont.  1981),
625 P.2d 539, 542, 38 St.Rep. 421, 425 (emphasis added). One
"other matter" specifically provided for in 2.52.340, ARM, is
the power to grant a new trial.
     In view of the broader powers exercised by the court, we
hold the standards for judicial review of a master's report
found at Rule 53 (e), M.R.Civ.P., are more applicable to the
facts of this case than the standard urged by T,iberty:
    Report.    (1)   Contents and filing.   The master
    shall prepare a report upon the matters submitted
    to him by the order of reference and, if required
    to make findings of fact and conclusions of law, he
    shall set them forth in the report ...
     (2) In nonjury actions. In an action to be tried
    without a jury the court shall accept the master's
    findings of fact unless clearly erroneous... The
    court after hearing may adopt the report or may
    modify it or may reject it in whole or in part or
    may receive further evidence or may recommit it
    with instructions.
The Workers' Compensation Court Judge appointed the Hearing
Examiner to hear the evidence in this case, but it was for
the court to make the final decision. The examiner's find-,
ings, conclusions and proposed decision were submitted to the
court for its approval.
     When reviewed in light of Rule 53(e), the record sup--
ports the court's decision to grant a new trial. The memo
and insurance form indicate that Gould's employer knew of her
injury and knew--or should have known--that the injury was
related to her employment.    This constitutes notice.    The
Hearing Examiner's denial of Gould's claim was based on the
lack of such notice. As Gould's properly-filed motion served
to point out, the examiner's findings of fact were therefore
clearly erroneous.   The court was correct in holding that
proper notice had been given, and a new trial should be
granted.
     We affirm the decision of the Workers' Compensation
Court that Gould gave proper notice of her injury, and remand
the case for a new trial on the merits of her claim.


                                  &*
                                   e       Justice


   Chief Justice
