                             No.    91-041

           IN THE SUPREME COURT OF THE STATE OF MONTANA
                                   1991



DAVID HARMON,
           Petitioner and Appellant,
    -vs-
VERN D. HARMON,
           Employer,
    and
STATE COMPENSATION MUTUAL INSURANCE FUND,
           Defendant and Respondent.



APPEAL FROM:    The Workers' Compensation Court,
                The Honorable Timothy Reardon, Judge presiding.


COUNSEL OF RECORD:
           For Appellant:
                Michael G. Eiselein; Lynaugh, Fitzgerald, Eiselein
                & Eakin, Billings, Montana.

           For Respondent:
                Chris Mangen, Jr.; Crowley, Haughey, Hanson, Toole
                & Dietrich, Billings, Montana.



                                   Submitted on Briefs:   May 24, 1991

Filed:


                                    #
                                   Clerk
Justice Fred J. Weber delivered the Opinion of the Court.

    The claimant, Mr. David Harmon (Mr. Harmon), filed a petition
in the Workerst Compensation Court under 5 39-71-2905, MCA, to
resolve a dispute with the insurer, State Compensation Mutual
Insurance Fund (State Fund).     Following a hearing before hearing
examiner Robert J. Campbell, the Workers' Compensation Court found
that claimant had not proved by a preponderance of the evidence
that he was permanently totally disabled as defined in 5 39-71-
702, MCA, as a result of a September 18,         1979   injury in an
industrial accident.     Mr. Harmon appeals.   We reverse and remand
for further proceedings consistent with this opinion.
     The dispositive issues as restated are:
     1.     Is there substantial credible evidence to support the
conclusion that Mr. Harmon's current condition is not the result
of the 1979 accident?
     2.    Did the Workers1 Compensation Court err when it found that
Mr. Harmon had failed to prove that he is permanently totally
disabled?
          At the time of trial, Mr. Harmon was a 47 year old married
man with three children, two of whom still live at home.         Mr.
Harmon worked as a ranch hand for his father, Vern Harmon, near
Lavina, Montana.     He also worked a small ranch of his own.     On
September 18, 1979, Mr. Harmon was baling hay on his father's
ranch.    The baler was not tying knots properly and when Mr. Harmon
attempted to correct the problem the baling twine wrapped around
the end of his right index finger.    To prevent his arm from being
                                  2
pulled into the baler, Mr. Harmon jerked back and stripped the soft
tissue off the end of his index finger.            The jerking action also
injured his elbow and shoulder.         That evening a portion of his
right index finger was amputated midway between the first and
second joints.     Approximately four months after the accident Mr.
Harmon went to see Dr. Huard and Dr. Daniels about the continuing
pain in his shoulder.        Mr. Harmon's shoulder was diagnosed as a
rotater cuff tear.      Over the next five months Dr. Huard and Dr.
Daniels treated Mr. Harmon with cortizone shots for his shoulder
injury. On April 9, 1982, Mr. Harmon received a "HoltonW award of
$5,370.00 based on a 14 percent whole man impairment rating. While

the shots gave temporary relief, the pain became progressively
worse with time.
     On December 6, 1984, Mr. Harmon suffered another injury while
doctoring a 900 pound bull for his father.           The bull charged him,
hitting him in the mid-section.        The rope was wrapped around his
right     hand   and   the   bull   jerked   him    violently   along    for
approximately 8 feet.        Mr. Harmon's back and neck were severely
injured    in this     accident which    ultimately      resulted   in   the
determination that Mr. Harmon was permanently totally disabled as
a ranch hand.     Mr. Harmon's shoulder also became more painful for
a period of time after the accident.         The treating physician, Dr.
Lovitt, testified that it was normal to have pain in the shoulders
in back injuries such as that experienced by Mr. Harmon and thus
his main concern was the back and not the shoulders.            He agreed
with the diagnosis by Dr. Huard and Dr. Daniels that Mr. Harmon was
suffering from a rotator cuff tear and that the back injury caused
the pain in the shoulders to be more acute for a period of time
following the accident.
     Following    counseling   with   Mr.   Chet   Dever,   vocational
rehabilitation counselor for Crawford Rehabilitation Services, Mr.
Harmon was retrained as a taxidermist in 1987.          Mr. Harmon's
shoulder continued to cause discomfort and on May 15, 1988, Dr.
Lovitt performed a manipulation procedure under anesthesia to
loosen Mr. Harmon's shoulder joint. Dr. Lovitt testified that this
procedure along with physical therapy exercises was expected to
relieve Mr. Harmon of some of the pain to the point that he could
live with it and continue his work as a taxidermist.
     Three days later on May 18, 1988, the Workers* Compensation
Division approved a full and final settlement for a lump sum of
$30,000.00 for injuries resulting from the 1984 accident.         The
settlement acknowledged that Mr. Harmon may require future surgery
for the rotator cuff injury and reserved future medical and
hospital benefits for the 1984 injuries.
     Mr. Harmon suffered two heart attacks in the months following
the manipulation procedure and the full and final settlement. The
heart attacks postponed further physical therapy exercises for the
shoulder injury. Until March 6, 1989, Dr. Lovitt*~
                                                 medical records
continued to     reflect the belief    that Mr.    Harmon's shoulder
condition was caused by a rotator cuff tear.        At that time Dr.
Lovitt performed a special x-ray examination which revealed for the
first time Mr. Harmon was actually suffering from a degenerative
condition known as glenohumeral arthritis. At that time Dr. Lovitt
stated in his medical records that he suspected that sometime in
the future Mr. Harmon would need a total shoulder replacement. Dr.
Lovitt testified that glenohumeral arthritis takes years to develop
to the stage that Mr. Harmon's condition was in at the time of
trial and that the 1984 accident was too recent to be the cause.
Therefore Dr. Lovitt concluded that the glenohumeral arthritis was
caused by the 1979 accident.
     On April 5, 1989, Dr. Lovitt referred Mr. Harmon to Dr. Thomas
Johnson who testified that he agreed with Dr. Lovitt's diagnosis.
When questioned about the cause of the arthritic condition, Dr.
Johnson testified that he did not look into the cause and that the
cause was not of concern to him.    Upon further questioning, Dr.
Johnson testified that he did not have enough information about the
accidents and therefore he had no way of knowing which accident
caused the injury.
     In light of the new diagnosis, Mr. Harmon sought benefits
through State Fund.   Mediation was held on July 11, 1989 in an
attempt to resolve the dispute between Mr. Harmon and State Fund.
When mediation failed to provide a solution, Mr. Harmon filed this
petition pursuant to 5 39-71-2905, MCA, to resolve the dispute.


                                I
     Is there substantial credible evidence to support the Workers'
Compensation Court's conclusion that Mr. Harmon's current condition
is not the result of the 1979 accident?
     The standard to be applied is whether substantial credible
evidence exists to support the Workers1 Compensation Court's
findings of fact.   As stated in Lakey v. Kerrianls (1987), 228
Mont. 139, 141, 741 P.2d 416, 417, this Court will not substitute
its judgment for that of the Workers' Compensation Court where
there is substantial evidence to support that court's findings of
fact. The parties submitted several proposed issues to the hearing
examiner for determination.    Prior to trial the hearing examiner
determined that the following issues would be determined by the
Court :
     1. Whether or not claimant's current condition is a
     result of his 1979 injury.
     2. Whether the claimant is permanently totally disabled
     as a result of his 1979 injury.
     3.    Whether the claimant is permanently partially
     disabled under 5 39-71-703, MCA, as a result of his 1979
     injury.
           (Mr. Harmon's counsel moved to withdraw the issue
     of permanent partial disability benefits at this time and
     State Fund agreed that it could be addressed in a later
     proceeding.)
     4. Whether claimant is entitled to a 20 percent penalty
     pursuant to § 39-71-2907, MCA.
     5.   Whether claimant is entitled to his costs and
     attorney fees.
     The Workers1 Compensation Court did not specifically determine
whether the current condition of Mr. Harmon's shoulder was the
result of the 1979 accident.     Instead, the court stated in its
judgment that the claimant had not met the burden of proving his
September 18, 1979 right index finger injury resulted in his being
permanently totally disabled. This statement is incorrect because
it does not address the issue as presented and argued by the
parties. The condition at issue is the shoulder injury and not the
right index finger injury. Mr. Harmon did not argue or attempt to
prove that his current disability is due to the right index finger
injury. As presented to the Workers8 Compensation Court, the basic
issue was whether the injury to Mr. Harmon's shoulder was related
to the 1979 accident or to the 1984 accident.
     In its conclusions of law, the Workersv Compensation Court
made the following factual determination:
     claimant's position is that the September 18, 1979 injury
     to his right index finger also injured his right shoulder
     which has increased in pain to a point that he is
     psrmanently totally injured (sic) as a result of that
     injury. However, from the testimony of the claimant and
     the medical evidence, it is clear that his shoulder
     became substantially more painful after claimant's
     December 6, 1984 injury in which a bull struck him in the
     mid-section and pulled him by the right arm for 8-9 feet.
     There is no question that claimant was aware of his
     shoulder injury when he petitioned for a settlement of
     his December 6, 1984 claim.      The medical testimony
     concerning the present condition of his right shoulder
     establishes a long term arthritic condition that was
     accelerated by his 1984 injury. What ever (sic) symptoms
     he may have felt prior to that time cannot by medical
     testimony, be found to be the result of the 1979 injury
     to his right index finger.
This factual determination is not supported in the record by
substantial credible evidence.   The primary care physician, Dr.
Lovitt, testified that glenohumeral arthritis is a degenerative
condition that takes years to manifest itself to the stage that Mr.
Harmon8s shoulder was in at the time of trial.        The Workers8
Compensation Court based its conclusion that Mr. Harmon could not
relate his current condition back to 1979 on Dr. Johnson's
testimony that he had no way of knowing whether the claimant's 1979
injury or his 1984 injury caused his shoulder impairment more than
the other.    However, this statement by Dr. Johnson followed
testimony that he did not look into the cause of Mr. Harmon's
condition, that his primary concern was to treat the condition, and
that he did not have sufficient facts on the two accidents to make
such a determination.   In considering all the medical testimony as
a whole, the statement by Dr. Johnson that he could not relate the
condition to the specific accident does not rise to the level of
substantial evidence to support the Workers' Compensation Court's
conclusion that Mr. Harmon did not meet his burden of proof that
the shoulder injury was caused by the 1979 accident.   We conclude
that the medical      evidence establishes Mr.   Harmon's   shoulder
condition was caused by the 1979 accident. Therefore we hold that
the Workers* Compensation Court's conclusion that Mr. Harmon's
current condition was not the result of the 1979 accident is not
supported by substantial credible evidence.
     State Fund argues that it does not matter if the 1979 accident
originally   caused   the   shoulder injury because   the   evidence
indicates that the shoulder injury was aggravated by the 1984
accident and therefore the full and final settlement for the 1984
accident fully compensated Mr. Harmon for his shoulder injuries.
This argument is not persuasive. As we have already concluded, the
medical evidence establishes Mr. Harmon's shoulder injury was
caused by the 1979 accident.    At that point the burden shifted to
State Fund to prove that Mr. Harmon's shoulder had reached maximum
healing before the 1984 accident.       Belton v. Carlson Transport
(1983), 202 Mont. 384, 389-90, 658 P.2d 405, 408.      The record does
not contain any medical evidence to establish that Mr. Harmon's
shoulder had reached maximum healing prior to 1984.




     Did the Workers' Compensation Court err when it found that Mr.
Harmon had failed to prove he is permanently totally disabled?
     Section 39-71-116(13), MCA (1979), defines permanent total
disability as:
     "Permanent total disability" means a condition resulting
     from injury as defined in this chapter that results in
     the loss of actual earnings or earning capacity that
     exists after the injured worker is as far restored as the
     permanent character of the injuries will permit and which
     results in the worker having no reasonable prospect of
     finding regular employment of any kind in the normal
     labor market.
The hearing examiner determined that Mr. Harmon had failed to meet
the second requirement of   §   39-71-116(13), MCA, to establish that

he has a total loss of actual earnings or earning capacity as a
result of his shoulder injury.     The court stated:
     There is no question that claimant was aware of his
     shoulder injury when he petitioned for a settlement of
     his December 6, 1984 claim.     The medical testimony
     concerning the present condition of his right shoulder
     establishes a long term arthritic condition that was
     accelerated by his 1984 injury.     ..
The record does not support a factual determination that the long
term arthritic condition was accelerated by the 1984 injury.       It
is clear from the record that prior to 1989 neither the doctors,
the parties, nor the Workerst Compensation Court knew that Mr.
Harmon's shoulder condition was caused by degenerative glenohumeral
arthritis, and therefore the claimant and the State Fund both were
not aware of the nature and extent of Mr. Harmon's shoulder injury
when he was retrained as a taxidermist and when the full and final
settlement was signed. The medical testimony established that the
long term arthritic condition was not diagnosed for almost a year
after the settlement and two years after retraining.
     Chet Dever, the vocational rehabilitation counselor who
handled Mr. Harmon's retraining claim, testified that he is of the
opinion that Mr.         Harmon   is capable of    earning money     as a
taxidermist at this time.           Mr.   Harmon testified that he is
optimistic that he will eventually be able to continue as a
taxidermist.      Mr. Dever testified that his projections indicate
that in ten years Mr. Harmon will be grossing in excess of
$50,000.00   per year.     Mr. Harmon voiced this same expectation.
     However, Dr. Lovitt testified that the range of motion of Mr.
Harmon's right arm due to the shoulder's arthritic condition is
limited to   60   degrees of external rotation,   45   degrees of internal
rotation, and     90   degrees of abduction, which in layman's terms is
about eight o'clock forward, backwards, and out from the body.
This limited motion prevents Mr. Harmon from lifting his arm high
enough to pull, stretch, and sew animal skins onto the forms. Dr.
Lovitt is personally familiar with the profession of taxidermy and
all that the work entails.         Mr. Harmon admitted that he had to
depend on volunteer help to stretch and sew the animal skins on the
forms because he could not lift his right arm high enough to reach
around the forms.
     Mr.     Mark   Schwager, rehabilitation counselor employed by
National Rehabilitation Consultants, testified that based on his
study in his opinion Mr. Harmon is totally unemployable.         Mr.
Schwager reviewed the depositions and medical records of Dr. Lovitt
and Dr. Johnson.     He interviewed and observed several taxidermists
at work, including the taxidermist who operates the only taxidermy
school in Montana and who had trained Mr. Harmon.       Mr. Schwager
also considered the Vocational Diagnostic Assessment of Residual
Employability in light of Mr. Harmon's vocational history and
medical information.      Mr. Schwager concluded that Mr. Harmon's
limited shoulder motion prevents Mr. Harmon from pursuing his goal
to continue as a taxidermist. Mr. Schwager testified to the stiff
competition among Montana taxidermists, and stated that leading
Montana taxidermists with national reputations are fortunate to
make $20,000.00 per year.      Therefore Mr. Schwager concluded Mr.
Dever's and Mr. Harmon's expectations of an eventual income of
$50,000.00    a year were unrealistic.   The hearing examiner found
that Mr. Schwagerlstestimony was not credible because Mr. Schwager
had not personally observed Mr. Harmon working in his shop.
However, on remand Mr. Schwagerlstestimony warrants consideration
in light of the medical testimony and the extent of Mr. Schwager's
professional investigation.
     Mr. Harmon testified that in 1988 he made a "couple of hundred
dollarsw and in 1989 he made $826.00.    With the help of volunteers
doing the heavier work he expected to gross about $6,000.00 in
1990.    Mr. Dever testified that these figures are consistent with
his projections and that as Mr. Harmon's reputation increased his
income would increase.
        Dr. Lovittprovides insight into Mr. Harmon's optimistic point
of view by stating that Mr. Harmon is a
     hard-driving, hard-working type person that really
     doesn't consider himself to have the time to give in to
     lesser aches and pains. And we frequently see ranchers
     like this working themselves into a rather significant
     pickle because they don't have the time for   --you know,
     they consider their job and their ranch and so forth more
     important and they are supporting their family, more
     important than these what they would consider lesser
     aches and pains that may not be lesser [and who]
     obviously the way he has handled his back is certainly
     not a pain-prone guy. He is nobody's sissy or wimp, you
     know. And these guys can tend to play down things for
     whatever reason    ...
        In light of all the testimony, we conclude that there is
substantial evidence to establish that Mr.        Harmon has become
permanently disabled     due to the arthritic condition of his
shoulder.    We conclude that the Workers' Compensation Court erred
when it found that Mr. Harmon had failed to prove that he is
permanently disabled.     However, because the Workerss Compensation
Court based its determination on the premise that Mr. Harmon could
not relate the injury to the 1979 accident and because the court
reserved the question of permanent partial disability, we remand
this case back to the Workers' Compensation Court for further
proceedings consistent with this opinion to determine whether Mr.
Harmon's permanent disability is partial or total in nature.     The
Workers9 Compensation Court may properly hold additional hearings
or admit additional evidence as needed to determine the issues
before the court on remand.
     Reversed and remanded.




We Concur:   __,*
                                            July 30, 1991

                            CERTIFICATE OF SERVICE

I hereby certify that the following order was sent by United States mail, prepaid, to the
following named:


Michael G. Eiselein
Lynaugh, Fitzgerald, Eiselein & Eakin
P.O. Box 1729
Billings, MT 59103

Chris Mangen, Jr.
Attorney at Law
P.O. Box 2529
Billings, MT 59103

                                                ED SMITH
                                                CLERK OF THE SUPREME COURT
