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Taylor v. State Fund3/18/1996
11, MCA, and award the twenty-percent statutory penalty against State Fund pursuant to § 39-71-2907, MCA. Reasonableness is a question of fact. Stordalen v. Ricci's Food Farm (1993), 261 Mont. 256, 258, 862 P.2d 393, 394. We must determine whether substantial credible evidence supports the court's finding that State Fund's actions were reasonable and that Taylor was not entitled to the statutory penalty.
The statutory penalty set forth in § 39-71-2907, MCA, was not intended to eliminate an insurer's assertion of a legitimate defense to liability. Paulson v. Bozeman Deaconess Found. Hosp. (1984), 207 Mont. 440, 444, 673 P.2d 1281, 1283. Here, State Fund pled and proved the nine elements of fraud in defending its decision to terminate Taylor's benefits. Further, the court determined that State Fund's actions were not unreasonable and that Taylor was not entitled to attorney's fees or the statutory penalty. As is illustrated by the court's findings that two of Taylor's three claims were fraudulent, substantial credible evidence supports the court's finding that State Fund's actions in terminating Taylor's benefits were reasonable. Accordingly, we conclude that the Workers' Compensation Court did not err in failing to award attorney's fees, costs, or the statutory penalty.
Affirmed.
JUSTICES NELSON, GRAY and ERDMANN concur.
JUSTICE HUNT specially concurs.
I concur in the conclusions reached by the majority but do not agree with all that is said in the opinion.
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