Opinion
W.C. Nos. 3-616-169 4-116-336
September 27, 2001
ORDER OF REMAND
The claimant seeks review of an order of Administrative Law Judge Harr (ALJ) which dismissed the claim for penalties on the basis the claimant failed to make a timely request as required by § 8-43-304(5), C.R.S. 2001. The claimant argues the statute does not apply to the claim, and that, in any event, she complied with the statute. The claimant also disputes the ALJ's determination that she "voluntarily withdrew" the pending penalty claim. We set the order aside and remand for entry of a new order.
The claimant sustained a compensable injury in September 1991. In December 1996 the claimant underwent a Division-sponsored independent medical examination (DIME). On April 24, 1997, the respondent filed an application for hearing seeking to overcome the medical impairment rating issued by the DIME physician. On May 14, 1997, the claimant filed a response to the application for hearing listing the issue of penalties for violation of Rule of Procedure IV (N) (6), 7 Code Colo. Reg. 1101-3 (establishing time limit for respondent to admit liability or request a hearing after receiving DIME physician's impairment rating). However, no hearing was held, and the process was repeated with the respondent filing another application for hearing on September 30, 1997, and the claimant filing a response on October 21, 1997, again raising the issue of penalties under Rule IV (N). However, the parties agreed to cancel the hearing scheduled as a result of these filings.
On March 9, 1999, the claimant filed an application for hearing again seeking penalties under § 8-43-304 based on the respondent's alleged failure to file an admission of liability or application for hearing "within 20 days of knowledge or receipt of the Division IME." This application for hearing, as well as a series of subsequent applications, were dismissed for various reasons prior to the occurrence of any hearing on the merits. The claimant's last application was filed on June 21, 2000, and it is this application which was dismissed by ALJ Harr and is the subject of the appeal.
The matter first proceeded to a hearing before ALJ Wheelock on October 11, 2000. However no evidence was taken, and the only result was that ALJ Wheelock directed the parties to file all future motions with her. (Tr. October 11, 2000, pp. 29-30). On October 20, 2000, the respondent filed a "motion for summary judgment" alleging the claimant did not make a timely "request for penalties" within the meaning of § 8-43-304(5). As an evidentiary basis for this motion, the respondent attached two letters authored by respondent's counsel and mailed to the claimant's counsel. The first letter dated January 26, 1998, refers to a telephone conference of January 26, 1998, and confirms the parties' agreement that claimant's counsel "would advise the Division that Respondent was withdrawing its application for hearing and that you are withdrawing the claims stated in your response to the Respondent's application for hearing." The second letter, dated January 30, 1998, refers to a January 29, 1998 telephone conversation, and states claimant's counsel "agreed to withdraw issues listed in" the claimant's response to application for hearing, but "noted that [claimant's counsel] might file a new Application for Hearing with regard to the issues withdrawn." That respondent's counsel further stated that it was "not my understanding that by withdrawing the issues for hearing you agreed that you would or would not re-file such issues."
The claimant was granted an extension to November 15, 2000, to respond to the motion for summary judgment. On November 15 the claimant filed a "motion to strike" the motion for summary judgment and requested a prehearing conference with ALJ Wheelock. The motion to strike argued that inclusion of the January 26 letter in the respondent's motion for summary judgment was "inappropriate" for evidentiary reasons. The motion to strike also alleged that, on an unspecified date, claimant's counsel replied to the respondent's January 26 letter. The letter authored by claimant's counsel, quoted in the motion, stated that "that there had been no agreement to withdraw our claims, but only to withdraw the application for hearing and our response." The letter further stated there was "never any agreement that the claim for penalties against [the respondent] would be withdrawn on a permanent basis."
Apparently, no action was taken with respect to either of these motions prior to January 30, 2001. On that date, respondent's counsel filed a motion requesting a ruling on the motion for summary judgment. ALJ Harr then entered the order under review on March 29, 2001.
ALJ Harr found, after reviewing the motion for summary judgment, pleadings, and exhibits, that the "undisputed evidence" demonstrates the claimant "filed timely penalty claims alleging violation of Rule IV (N) (6)" on May 14, 1997 and October 21, 1997. However, ALJ Harr also found the undisputed evidence establishes the claimant "voluntarily withdrew those claims on January 26, 1998," and did not file another application for hearing asserting a penalty claim until March 9, 1999. ALJ Harr concluded the claimant's "voluntary withdrawal of her October 21, 1997 penalty claim, on January 26, 1998, extinguished that claim and that no subsequent claim for penalty" was filed prior to April 1, 1998 (one year from the date claimant's counsel first received notice of the DIME physician's report). Therefore, ALJ Harr dismissed the claimant's June 21 application for hearing.
I.
On review, the claimant first contends that § 8-43-304(5) does not apply to this claim because it is "substantive," and was enacted after the claimant's injury. We reject this argument.
Section 8-43-304(5) was enacted in 1994, and the statute contains no specific directive concerning its effective date. 1994 Colo. Sess Laws, ch. 309 at 1879. The statute provides as follows:
A request for penalties shall be filed with the director or administrative law judge within one year after the date that the requesting party first knew or reasonably should have known of facts giving rise to a possible penalty.
The claimant argues that "substantive"statutory amendments may not be applied retroactively, and that § 8-43-304(5) is a "substantive limitation" on a "previously vested right to request penalties." Under these circumstances, the claimant cites First Interstate Bank v. Central Bank, 937 P.2d 855 (Colo.App. 1996), for the proposition that when a statute creates a right unknown at common law, and also creates a period within which the right may be asserted, the "time limit is a substantive provision which qualifies or conditions the right, as distinguished from a statute of limitations which must be asserted as a defense." Id. at 861. We are not persuaded by these arguments.
We agree with the respondent that Colorado law clearly holds that statutes of limitation and statutes of repose are remedial rather than substantive in nature. Therefore, changes in such statutes may be applied to an existing claim for relief without violating the constitutional prohibition against retroactive legislation. See Vetten v. Industrial Claim Appeals Office, 986 P.2d 983 (Colo.App. 1999); Woodmoor Improvement Association v. Property Tax Administrator, 895 P.2d 1087 (Colo.App. 1994). The rationale for these decisions is that the abolition of an old remedy, or the substitution of a new one, "does not impair a vested right or impose a new duty, for there is no such thing as a vested right in remedies." Vetten v. Industrial Claim Appeals Office, 986 P.2d at 986; but see Diversified Veterans Corporate Center v. Hewuse, 942 P.2d 1312 (Colo.App. 1997) (holding cure provisions of § 8-43-304(4) are substantive because they modify a pre-existing liability for penalties and add an element of proof not previously required).
First Interstate Bank v. Central Bank, cited by the claimant, is not authority to the contrary. The issue in that case concerned whether application of a statute of repose, which applied to claims brought under the state securities act, could be waived by agreement of the parties or constituted a nonwaivable jurisdictional bar to the action. The court distinguished between a statute of repose which conditions a statutory right and is, therefore, a "substantive provision," and a statute of limitations which must be asserted as an affirmative defense. In any event, the court concluded the statute of repose at issue was not jurisdictional and could be waived by agreement of the parties. Thus, the case is inapposite to the issue presented here.
II.
The claimant next contends that even if § 8-43-304(5) applies, she complied with the statute by raising the penalty issue in the responses to application for hearing which she filed on May 14 and October 21, 1997. We agree with the claimant.
Section 8-43-304(5) requires merely that a "request for penalties" be filed with an ALJ within one year after the claimant reasonably should recognize facts giving rise to the possible penalty, and the statute does not prescribe any particular form of the request. It has been held that the purpose of a "notice of claim" is to identify the party seeking relief, to notify the other party that an allegedly compensable event has occurred, and convey the expectation of compensation. See Martin v. Industrial Commission, 608 P.2d 366 (Colo.App. 1980). Further, technical irregularity in an otherwise sufficient notice of claim does not preclude consideration of the claim. See Intermountain Rubber Industries v. Valdez, 688 P.2d 1133 (Colo.App. 1984).
We hold a response to an application for hearing may constitute a valid "request for penalties" for purposes of § 8-43-304(5), C.R.S. 2001. The Rules of Procedure VIII (A) (1), (3) and (5), 7 Code Colo. Reg. 1101-3, clearly contemplate that a party filing a response to an application for hearing may list penalties under § 8-43-304 as an issue to be considered in addition to the issues raised by the party which filed the application for hearing. By filing a response to application for hearing listing the issue of penalties the party seeking the penalty identifies itself as the party seeking relief, notifies the opposing party that an alleged violation has occurred, and notifies the alleged violator that relief is expected under the statute.
However, the fact that an application for hearing or response to an application for hearing which lists the issue of penalties is subsequently withdrawn or dismissed does not vitiate the effectiveness of the "request for penalties" for purposes of § 8-43-304(5). Applications for hearing and responses to application for hearing are part of the administrative machinery for processing claims and they may be withdrawn or dismissed for many reasons. These reasons include the unavailability of witnesses, the parties' desire to continue a hearing for other reasons, and the desire to pursue further negotiation of pending claims. Thus, insofar as ALJ Harr's order may be read as holding the claimant's withdrawal of the response to the application for hearing vitiated the "request for penalties" and triggered a responsibility to file a new request within the one year period of limitation established by § 8-43-304(5), we disagree. The claimant did all the statute required when she listed the issue of penalties in the responses filed on May 14 and October 21, 1977.
III.
The claimant also contends the ALJ erred in holding the undisputed evidence establishes the claimant waived the request for penalties by agreeing to withdraw the October 21, 1997 response to application for hearing. Insofar as the claimant asserts there is a disputed issue of fact which entitles him to a hearing on this issue, we agree.
Where the pertinent facts are undisputed, an ALJ may dispose of an issue without conducting a hearing because the matter is one of law. See Service Supply Co. v. Vallejos, 169 Colo. 14, 452 P.2d 387 (1969). However, if an administrative adjudication turns on disputed issues of fact, due process requires that the parties be apprised of all evidence to be submitted and considered, be afforded a reasonable opportunity in which to confront adverse evidence, and afforded an opportunity to present argument in support of their positions. Hendricks v. Industrial Claim Appeals Office, 809 P.2d 1076 (Colo.App. 1990).
It is true a party may waive valuable rights. A waiver exists where there is evidence of an intentional relinquishment of a known right. A waiver may be explicit, or it may be implied if a party engages in conduct which manifests an intent to relinquish the right, or acts inconsistently with assertion of the right. Johnson v. Industrial Commission, 761 P.2d 1140, 1147 (Colo. 1988). If the claim of waiver is implied from conduct, the record must demonstrate the conduct is free from ambiguity and clearly manifests an intention not to assert the right. Department of Health v. Donahue, 690 P.2d 243, 247 (Colo. 1984). Generally, the existence of a waiver is a factual issue which must be determined by consideration of all the relevant evidence. Johnson v. Industrial Commission, supra.
Here, the ALJ found the "undisputed" evidence demonstrates the claimant voluntarily withdrew his "claims" for penalties on January 26, 1998. However, in the claimant's motion to strike the motion for summary judgment, the claimant expressly disputed the assertion that she withdrew her claim for penalties. Rather, the motion to strike alleges the existence of a letter in which claimant's counsel expressly reserved the "claims" for penalties while consenting to the respondent's withdraw of the application for hearing and agreeing to withdraw the claimant's response. Thus, at a minimum, the record reflects disputed issues of fact concerning the nature of the parties' agreement in January 1998, and whether the conduct of claimant's counsel may be considered unambiguous evidence of an intention to waive the claim for penalties. In reaching this result, we presume ALJ Harr considered the motion to strike because it is contained in the record and he expressly stated that he considered the "pleadings."
Under these circumstances, ALJ Harr's order dismissing the claim for penalties must be set aside, and the matter remanded with directions to conduct a hearing determining whether or not the claimant "waived" the claim for penalties. If it is found the claimant did not waive the claim for penalties, a hearing shall be conducted on the merits of the claim. In light of this determination, we need not consider the other arguments raised by the claimant.
IT IS THEREFORE ORDERED that ALJ Harr's order dated March 29, 2001, 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 September 27, 2001 to the following parties:
Brenda S. Kessler, 149 Rio Grande, Canon City, CO 81212
Susan M. Dillon, NHA, Mountain Meadows Nursing Center, 2277 East Dr., Monte Vista, CO 81144
Mary Ann Donelson, Support Services, Inc., P. O. Box 3513, Englewood, CO 80155-3513
Subsequent Injury Fund, Tower 2, #630, Division of Workers' Compensation — Interagency Mail
Jon C. Thomas, Esq., 1032 N. Wahsatch Ave., Colorado Springs, CO 80903-2484 (For Claimant)
William A. Richardson, Esq., 400 Sussex Building, 1430 Larimer Square, Denver, CO 80202 (For Respondents)
Jill Gallett, Esq., Office of the Attorney General, 1525 Sherman St., 5th floor, Denver, CO 80203 (For Subsequent Injury Fund)
BY: A. Pendroy