Opinion
W.C. No. 4-334-414, 4-348-994, 4-348-996
November 21, 2000
ORDER OF REMAND
In these consolidated workers' compensation cases the claimant seeks review of an order of Administrative Law Judge Gallegos (ALJ) which determined that two claims were "administratively closed" because of the claimant's failure to object to two final admissions of liability. The effect of the ALJ's order is to deny the claimant an opportunity to seek a Division-sponsored independent medical examination (DIME). We set the order aside and remand for further proceedings.
This case has a complex procedural history, and a review of the history is necessary to understand the issues involved. The claimant was apparently employed at the Poudre Valley Hospital in 1996. On April 14, 1997, counsel for the claimant filed a claim for benefits alleging an "injury/disease" occurring on August 6, 1996. The injury was described as affecting the claimant's back, neck, right upper extremity, left hip, and causing bilateral thoracic outlet syndrome. This claim was assigned W.C. No. 4-334- 414. On May 7, 1997, the Colorado Compensation Insurance Authority (CCIA) filed a Notice of Contest alleging that the claimant was "not an employee of Poudre Valley Health Care."
On August 8, 1997, the employer, Poudre Valley Health Care, filed two separate first reports of injury. One of these documents states the claimant reported a "repetitive motion" injury to her right elbow on August 30, 1996. The second of these reports states that on November 29, 1996, the claimant reported that repetitive bending caused pain in her left hip.
On August 8, 1997, Poudre Valley Hospital filed a final admission of liability. This final admission referred to the November 29, 1996 (left hip) injury, and bore no workers' compensation claim number. However, at some point in time, this "claim" was assigned W.C. No. 4-348-996. The August 8 admission contains no admission of liability for any benefits, including medical benefits.
On August 15, 1997, "Support Services, Inc. for Poudre Valley Hospital," filed a final admission of liability referring to the August 30, 1996 (right elbow) injury. This admission bears no workers' compensation claim number, but does admit for $4615 in medical benefits. Eventually, the "claim" for this injury was assigned W.C. No. 4-348-994.
On September 29, 1997, counsel for the claimant filed an Objection to Final Admission of Liability. This document bore W.C. No. 4-334-414. However, Poudre Valley Hospital and Support Services, Inc. are listed as respondents in the caption, and the pleading registers the claimant's "Objection to the Final Admission of Liability filed in the above-captioned matter and mailed to the claimant on August 15, 1997." The document also states the claimant's objection to "all previous Admissions filed herein."
Eventually, the claimant requested a DIME with respect to all three claims. On September 27, 1999, the respondents moved to dismiss the request on grounds that W.C. No. 4-348-994 and W.C. No. 4-348-996 were closed because of the claimant's failure to object to the two final admissions filed in August 1997. On October 12, 1999, the respondents' motion to dismiss was granted by a Prehearing Administrative Law Judge. The claimant then sought a hearing to determine the correctness of the PALJ's ruling, and a hearing was held before the ALJ on February 1, 2000. No testimonial evidence was presented, although the parties submitted documents.
On April 18, 2000, the ALJ ruled that W.C. No. 4-348-994 and W.C. No. 4-348-996 were "administratively closed" because of the claimant's failure to object to the final admissions of August 8, 1997, and August 15, 1997. In so doing, the ALJ concluded that the "objection" filed by the claimant on September 29, 1997, was applicable to W.C. No. 4-334-414, and of no effect in preserving W.C. No. 4-348-994 and W.C. No. 4-348-996. The ALJ also concluded that the two final admissions of liability were not vitiated by the fact that the respondents attached the same medical report to each admission.
On review, the claimant first contends the September 29 objection, which was filed within 60 days of the August 8 and August 15 final admissions of liability, was sufficient to prevent closure of these claims. The claimant argues that placing the "wrong W.C. number" at the top of the objection did not nullify the effectiveness of the objection because the claimant "had no claim on file against said Respondents with said W.C. number," and it should have been obvious to the respondents "to which claim or claims the objection applied." The claimant also argues the objection should be effective with respect to both final admissions of liability because it expressly refers to the August 15 admission and contains an objection to all prior admissions. For their part, the respondents argue the objection was ineffective since it referred to a claim number involving Poudre Valley Hospital and the CCIA. Moreover, the respondents argue that it was not their "state of mind" which was at issue, but the claimant's failure to comply with the statutory requirements for objecting to a final admission. We agree with the claimant, although our reasoning is different with respect to the August 8 final admission.
We first consider whether the August 15 final admission was sufficient to close W.C. No. 4-348-994, (right elbow, August 30, 1996 date of injury). The effectiveness of the August 15 final admission of liability is governed by former § 8-43-203(2)(b), C.R.S. 1996 [amended in 1998 for injuries occurring on or after August 5, 1998, 1998 Colo. Sess. Laws, ch. 313 at 1431-1432]. The statute provides as follows:
(2) (b) If the employer or, if insured, the employer's insurance carrier admits liability, such notice shall specify the amount of compensation to be paid, to whom compensation will be paid, the period for which compensation will be paid, and the disability for which compensation will be paid, and payment thereon shall be made forthwith. An admission of liability for final payment of compensation shall include a statement that this is the final admission by the workers' compensation insurance carrier in the case, that the claimant may contest this admission if the claimant feels entitled to more compensation, to whom the claimant should provide written objection, and notice that if the claimant does not contest the final admission in writing within sixty days of the date of the final admission the case will be automatically closed as to the issues admitted in the final admission. When the final admission is predicated upon medical reports, such reports shall accompany the final admission.
The purpose of this statutory scheme, which permits closure of claims by filing final admissions of liability, is to "promote, encourage, and insure prompt payment of compensation to an injured worker without the necessity of formal administrative determination in cases not presenting a legitimate controversy." Cibola Construction v. Industrial Claim Appeals Office, 971 P.2d 666, 668 (Colo.App. 1998). Thus, the apparent purpose of requiring a claimant to object to a final admission within sixty days is to notify the respondents that the claimant does not accept the respondents' "final" position concerning the claimant's entitlement to additional benefits, and to alert the respondents that there is an ongoing controversy which is not subject to resolution by administrative closure. Cf. Smith v. Myron Stratton Home, 676 P.2d 1196 (Colo. 1984) (purposes of requiring respondents to admit or deny liability are to alert the claimant that he is involved in a "situation with legal ramifications" and assist the Division in executing its administrative functions). The respondents' position notwithstanding, we conclude that the September 29 "objection" was sufficient to satisfy these statutory objectives and prevent closure of W.C. No. 4-348-994 based on the August 15 final admission.
By way of analogy, we note the statutes currently codified at § 8-43-203(1)(a) and (2)(a), C.R.S. 2000, permit the imposition of penalties against an employer or insurer who fails timely to file a written admission of liability or notice of contest upon notice of an injury. However, our courts have not strictly enforced the requirements of a written admission of liability or notice of contest where the respondents have substantially complied with the statutory mandate. In Hanson v. Industrial Commission, 716 P.2d 477 (Colo.App. 1986), the court held that a penalty for failure to file a written admission or denial terminated when the respondents appeared at a hearing and verbally admitted liability for certain benefits, and denied liability for other benefits. A similar issue was raised in Eastman Kodak Co. v. Industrial Commission, 725 P.2d 85 (Colo.App. 1986). In Eastman Kodak, the claimant sustained an admitted back injury in 1979. In 1982 the claimant experienced additional back symptoms and was unable to continue working. In September 1982 the employer filed an admission of liability in the claim for the 1979 injury. However, it was subsequently determined the claimant sustained a new compensable injury in 1982, and the ALJ imposed penalties for failure timely to admit or deny liability from August 16, 1982, through April 11, 1984, the date of the hearing on the new injury. However, the Court of Appeals concluded the penalty period terminated in September 1982 when the employer filed the admission of liability in the 1979 claim. The court reasoned that it would "exalt form over substance" to allow the penalty to run beyond the date of the September 1982 admission even though the admission was filed in the "previous proceeding." The court noted the admission informed the claimant that the employer considered the claimant's condition to be a continuation of the 1979 injury, and the employer intended to compensate the claimant's wage loss. Further, the court noted the employer could not predict whether the 1982 condition would be considered a continuation of the 1979 injury or a "new injury," and the imposition of penalties would "unfairly penalize the employer for reasonable actions it took based upon its initial classification of claimant's subsequent back injury as a worsening of claimant's first back injury." Id. at 87.
Here, the September 29 objection was sufficient to satisfy the statutory objectives of § 8-43-203(2)(b) by notifying the respondents that the claimant objected to the final admission filed on August 15. Admittedly, the objection referred W.C. No. 4-334-414, the claim number assigned to the April 14, 1997 claim for the August 6, 1996 injury. However, as the respondents acknowledge and the ALJ found, no final admission was ever filed in W.C. No. 4-334-414, and that claim has never been litigated. Therefore, it would be absurd to infer the September 29 objection was designed to object to a final admission of liability which was never filed. Moreover, the September 29 objection explicitly refers to the final admission mailed to the claimant on August 15, 1997, lists Support Services Inc. as a respondent in the caption, and was mailed to Support Services Inc. "for" Poudre Valley Hospital. In light of these circumstances, the only reasonable interpretation of the September 29 objection is that it was filed in response to the August 15 final admission submitted on behalf of Poudre Valley Hospital by Support Services Inc. It would elevate form over substance to conclude the reference to W.C. No. 4-334-414 deprived the respondents of notice that the claimant intended to object to the August 15 final admission in what would become W.C. No. 4-348-994.
Moreover, when the August 15 final admission was mailed, no claim had ever been filed for an August 30, 1996 elbow injury, and no workers' compensation claim number had been assigned for such an injury. Indeed, the August 15 final admission was filed only one week after the employer's first report, and the admission itself does not refer to any workers' compensation claim number. However, the claimant had filed a claim for benefits in W.C. No. 4-334-414, a claim which allegedly encompassed injury to the claimant's right upper extremity. Since there never has been an adjudication of the precise nature of the claimant's injury, disease, or diseases, and the claimant has alleged that all conditions are related to her employment, the claimant should not be penalized for timely objecting to a final admission and utilizing the claim number for the only claim she ever filed. Cf. Eastman Kodak Co. v. Industrial Commission, supra.
We also conclude the claimant's failure to file a separate objection to the August 8 final admission does not serve to close the "claim" in W.C. No. 4-348-996. As provided in § 8-43-203(2)(b), an admission of liability must specify the amount of compensation to be paid, to whom the compensation will be paid, and the period for which compensation will be paid. The claimant may then object to a final admission of liability if he believes he is entitled to additional compensation. Thus, the statute contemplates that an admission of liability, final or otherwise, will contain a concession that the respondents are liable to pay some form of compensation or benefit. If the final admission does not admit for some type of benefit it is nothing more than a notice of contest expressing the respondents' position that they are denying the claim and not liable for any benefits. Section 8-43-203(2)(b) does not require the claimant to object to a notice of contest in order to avoid closure of the claim, and failure to object cannot be treated as a voluntary relinquishment of the claim. See Johnson v. McDonald, 697 P.2d 810 (Colo.App. 1985) (decided under prior law).
The respondents' August 8 final admission does not admit liability for any benefits of any type. Therefore, this document is a notice of contest, not an "an admission of liability for final payment of compensation" under § 8-43-203(2)(b). Consequently, the claimant's failure to object to the document is of no consequence and did not close W.C. No. 4-348-996.
In light of this disposition, we need not consider the claimant's remaining arguments.
IT IS THEREFORE ORDERED that the ALJ's order dated to April 18, 2000, is set aside, and the matter is remanded for further proceedings consistent with the views expressed herein.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
Copies of this decision were mailed November 21, 2000 to the following parties:
Santha Bishop Blum, 3008 E. Locust, Ft. Collins, CO 80524
Yvonne Chudd, Poudre Valley Hospital, 1024 S. Lemay Ave., Ft. Collins, CO 80524-3998
Denise Groves, Support Services, Inc., P. O. Box 3513, Englewood, CO 80155-3513
Richard K. Blundell, Esq., and Lauren Cabot Oray, Esq., 1024 8th St., Greeley, CO 80631 (For Claimant)
Anne Smith Myers, Esq., 3900 E. Mexico, #1000, Denver, CO 80210 (For Respondents)
BY: A. Pendroy