Opinion
W.C. No. 4-526-764
February 18, 2004
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Harr (ALJ) which reopened an award of temporary total disability (TTD) benefits, ordered that TTD benefits received be repaid, and denied a claim for medical benefits for treatment of a knee condition. The claimant contends the ALJ erred in determining the respondents showed grounds for reopening based on fraud. The claimant further contends the evidence does not support the finding that the claimant did not prove a causal relationship between the injury and the knee condition. We affirm.
The claimant sustained a compensable back injury on September 20, 2001, while performing duties as custodian for respondent SBM Cleaning Company (SBM). A treating physician imposed restrictions which precluded the claimant from performing her regular duties. However, the employer provided modified duties within the claimant's restrictions and the claimant returned to work at a facility operated by Hewlett Pakcard (HP).
On February 27, 2002, HP surveillance cameras detected the claimant leaving an HP building pushing a wheeled trash cart known as a brute. The claimant pushed the brute to her husband's car. The husband then removed a black trash bag from the brute and drove away.
The claimant's supervisor questioned the claimant concerning this incident and the claimant told her supervisor that the bag contained videotapes which had been given to her by a coworker, Lita Lerma (Lerma). The claimant also told the supervisor that she received the videotapes several weeks earlier, stored them in an HP building, and forgot to remove them until February 27. Based on this incident SBM terminated the claimant from employment because HP would no longer allow the claimant to work at its facility and no other jobs were available.
On July 18, 2002, the matter proceeded to hearing on the issue of the respondents' liability for TTD after the claimant's termination from employment on March 6, 2002. The claimant testified to facts largely consistent with her statements to the supervisor. The claimant also denied having contact with Lerma after the termination. Relying on the claimant's testimony concerning the videotapes, the ALJ entered an order on August 8, 2002, finding that the claimant was not responsible for the termination and awarding TTD benefits.
In November 2002, the respondents filed a petition to reopen the award of TTD benefits alleging that the claimant gave false testimony at the July hearing thus procuring the award by fraud. At the hearing on reopening Lerma testified that she gave the claimant a white plastic bag containing videotapes in early January 2002, and these videotapes were never taken inside the HP facility or transported in a brute. Instead, the claimant placed the tapes directly in her husband's car upon delivery by Lerma. Lerma also testified that the claimant contacted her after the termination and attempted to get Lerma to tell the supervisor that the videotapes had been stored in the HP facility. Further, the claimant attempted to contact Lerma some fifteen times after the termination. The claimant admitted that her July testimony was "mistaken" to the extent she denied contacting Lerma after the separation.
The ALJ, crediting Lerma's testimony and discrediting the claimant's testimony, found the claimant "lied" to her supervisor concerning the incident of February 27, and lied at the hearing in July 2002. The ALJ also determined that under these circumstances the claimant was "responsible" for the termination within the meaning of § 8-42-103(1)(g), C.R.S. 2003; and § 8-42-105(4), C.R.S. 2003 (termination statutes). Finally, the ALJ concluded the award of TTD benefits should be reopened because it was fraudulently procured by the claimant's false testimony, and ordered the claimant to repay the TTD benefits she received after March 6.
The ALJ also denied the claimant's request for medical benefits for treatment of a tear of the left medial meniscus. In so doing the ALJ credited the testimony of Dr. Pineiro that the alleged mechanism of injury was not likely to have caused a tear of the meniscus, and Lerma's testimony that the claimant did not complain of left knee pain after the injury.
I.
On review, the claimant contends the ALJ erred in reopening the award of TTD benefits based on fraud. In support, the claimant points out that prior to the July 2002 hearing Lerma had given a written statement to her supervisor stating that the claimant contacted Lerma after the termination and attempted to get her to "lie" on the claimant's behalf. The respondents contend the respondents knew or reasonably should have known of Lerma's potential testimony at the time of the July hearing, and their failure to call her at that hearing legally compelled the ALJ to deny the petition to reopen. We disagree.
An ALJ may reopen an award on grounds of fraud, and the ALJ may order repayment of benefits fraudulently procured. Section 8-43-303(1), C.R.S. 2003. The claimant does not deny that false testimony which provides the basis of an order awarding benefits constitutes a form of fraud sufficient to reopen a claim. Indeed, prior to inclusion of "fraud" in the reopening statute, perjured testimony was classified as a form of "mistake of fact" on which reopening could be predicated. See Lewis v. Scientific Supply Co., Inc. v. Industrial Claim Appeals Office, 897 P.2d 905 (Colo.App. 1995).
Reopening is a matter within the sound discretion of the ALJ, and we will not interfere with the ALJ's decision absent an abuse of discretion. An abuse is not shown unless the order is beyond the bounds of reason, as where it is contrary to law or unsupported by the evidence. See Jarosinski v. Industrial Claim Appeals Office, 62 P.3d 1082 (Colo.App. 2002). Generally, the ALJ must determine that the party seeking reopening has established one of the statutory bases for reopening, and that the circumstances justify reopening. See Travelers Insurance Co. v. Industrial Commission, 646 P.2d 399 (Colo.App. 1981) (appellate decision issued after order awarding partial dependency benefits justified ALJ's decision to reopen case to award full dependency benefits).
It is true, as the claimant argues, that when determining whether to reopen a claim based on mistake or fraud the ALJ may consider whether the alleged mistaken or fraudulent circumstances could have been discovered and presented at the first hearing through the exercise of due diligence. See Department of Agriculture v. Wayne, 30 Colo. App. 311, 493 P.2d 683 (1971); Bradley v. Ampex Corp., W.C. No. 4-211-540 (May 12, 1998), aff'd. Bradley v. Industrial Claim Appeals Office, (Colo.App. No. 98CA1026, December 10, 1998) (not selected for publication). However, the ALJ may balance this factor against competing interests, including the injustice which would result from giving final effect to an erroneous or fraudulently procured result. Renz v. Larimer County School District Poudre R-1, 924 P.2d 1177 (Colo.App. 1996) (reopening authority is evidence of legislative policy that goal of achieving fair and just result overrides litigants' interests in finality); Gurule v. Board of Developmentally Disabled, W.C. No. 3-595-093 (February 9, 1995); Harris v. Fire House Car Wash, Inc., W.C. No. 3-848-539 (June 18, 1992).
Here, we perceive no abuse of discretion in the ALJ's order reopening the award of TTD benefits based on the claimant's fraudulent testimony at the July 18 hearing. The ALJ found as fact that the claimant "lied" to her supervisor and to the ALJ at the July hearing concerning the removal of the trash bag from the HP premises. This finding is amply supported not only by the claimant's own admissions that her testimony on July 18 was "mistaken", particularly with respect to her contacts with Lerma, but by Lerma's testimony itself. Further, the ALJ determined that but for the fraudulent testimony he would not have issued the August 8 order awarding TTD benefits, but would instead have found the claimant responsible for the termination.
It is true that prior to the July hearing the employer was in possession of Lerma's written statement, and that this statement substantially contradicted the testimony which the claimant gave at the July hearing. However, the ALJ did not consider this factor to be decisive because the written statement had been misplaced by the employer before the July hearing and never provided to respondents' counsel. (Finding of Fact 10). Thus, the respondents' failure to call Lerma as a witness at the July hearing was mitigated because it was not the result of deliberate tactical judgment by respondents' counsel. Moreover, to the extent there was some negligence on the part of the respondents in failing to locate the statement and produce Lerma's testimony at the July hearing, the ALJ weighed that negligence against the claimant's action in giving false testimony, and the consequent injustice of the award of TTD benefits. Considering the totality of the circumstances, we cannot say the ALJ abused his discretion in granting the petition to reopen based on fraud.
II.
The claimant next contends the ALJ was compelled to find that the tear of the medical meniscus was caused by the industrial injury. In support, the claimant points out some medical records indicating that she complained of knee pain after the industrial injury, as well as the report of Dr. Donner. We find no error.
The claimant had the burden to prove the need for treatment of the knee was caused by the industrial injury. The question of whether the claimant did so was an issue of fact for determination by the ALJ, and we must uphold the ALJ's determination if supported by substantial evidence in the record. Section 8-43-301(8), C.R.S. 2003; Faulkner v. Industrial Claim Appeals Office, 12 P.3d 844 (Colo.App. 2000). This standard of review requires us to defer to the ALJ's resolution of conflicts in the evidence, credibility determinations, and plausible inferences drawn from the record. Cordova v. Industrial Claim Appeals Office, 55 P.3d 186 (Colo.App. 2002).
Here, there is ample evidence to support the ALJ's determination that the claimant failed to prove the requisite causal relationship. The September 20, 2001, medical report notes "radiation" of pain from the left SI joint into the left lower extremity, but not below the knee. The report also mentions an "acute low back injury," but contains no description of a discrete knee injury. Dr. Pineiro, whose opinions were credited by the ALJ, opined that under these circumstances the mechanism of the injury probably did not cause the meniscal tear. Further, Lerma testified the claimant did not report problems with her knee after the injury.
It is true that some evidence, including various medical reports and the opinion of Dr. Donner, would support a contrary finding. However, that mere existence of conflicting evidence which the ALJ did not find persuasive affords no basis for appellate relief. Wilson v. Industrial Claim Appeals Office, 81 P.3d 1117 (Colo.App. 2003).
IT IS THEREFORE ORDERED that the ALJ's order dated April 15, 2003, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________ David Cain
______________________________ Kathy E. Dean
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, Colorado 80203, by filing a Petition to Review with the Court, within twenty (20) days after the date this Order was mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2003. The appealing party must serve a copy of the Petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this order were mailed to the parties at the addresses shown below on February 18, 2004 by A. Hurtado.
Rose M. Calderon, 3125 E. Locust St., Fort Collins, CO 80524
SBM Cleaning Co., LLC, 5616 S. College Ave., #C, Fort Collins, CO 80525
SBM Cleaning Co., LLC, 2410 Manning St., #E, Sacramento, CA 95815
Christy Thomann, Zurich American Insurance, P. O. Box 20048, Kansas City, MO 64195
Lee E. Christian, Esq., 415 Mason Court, Bldg. 2, Fort Collins, CO 80524 (For Claimant)
Frank Cavanaugh, Esq., 1801 Broadway, #1500, Denver, CO 80202 (For Respondents)