Opinion
W.C. No. 3-843-951
January 12, 1999
FINAL ORDER
In this claim for death benefits the claimant seeks review of an order of Administrative Law Judge Wheelock (ALJ), insofar as the order denied a claim for penalties under § 8-43-304(1), C.R.S. 1998, based on the respondents' alleged failure to disclose three physician's reports. The claimant also contests the ALJ's refusal to exclude the testimony and reports of these physicians. We affirm the ALJ's denial of the claim for penalties. We dismiss without prejudice that portion of the petition to review pertaining to the admission of testimony and evidence.
This case has a lengthy procedural history which must be reviewed to understand the issues. In November 1995 the claimant filed an application for hearing seeking death benefits. The respondent-employer (Hewlett Packard) and the respondent-insurer (Liberty Mutual) filed separate responses to the application. Hewlett Packard's response, which was signed by attorney McCrea (McCrea) listed fifty-nine potential witnesses, including Dr. Kinsman, Dr. Gutterman, and Dr. Repsher.
On December 7, 1995, claimant's counsel, attorney Mullens (Mullens), filed a "Demand for Production of Essential Information/Answers to Interrogatories." This document requested Hewlett Packard to provide "a written statement as to the facts that will be testified to by each of the fifty-nine plus witnesses" identified in the response to application for hearing. On December 22, 1995, McCrea responded that Drs. Kinsman, Gutterman, and Repsher would testify or submit written reports concerning their "review of the records and their respective opinions as to the causal relatedness" between the decedent's death and the industrial injury. On December 27, 1995, Mullens responded by letter stating that the information provided by McCrea was "wholly inadequate" and insisting that McCrea provide a "capsule summation of each one of [the witnesses'] opinions" or face a "motion to compel."
It is undisputed that by May 6, 1996, McCrea had received written reports from all three physicians. However, these reports were not immediately provided to Mullens.
On October 4, 1996, after extensive litigation on various preliminary issues, the claimant filed a second application for hearing on the issue of death benefits. The hearing was set for February 7, 1997.
On January 6, 1997, Mullens sent a letter requesting McCrea to submit a copy of "all medicals" in his possession. On January 8, 1997, McCrea forwarded the previously withheld reports of Drs. Kinsman, Gutterman, and Repsher.
By letter of January 14, 1997, Mullens forwarded interrogatories to McCrea concerning McCrea's alleged "suppression of the reports." In a letter dated January 17, 1997, McCrea replied that he considered the physicians' reports to be "expert reports" which the respondents were not required to disclose until twenty days prior to the hearing.
On January 24, 1997, Mullens filed a motion alleging that under Rule of Procedure XI (B) (2), 7 Code Colo. Reg. 1101-3 at 39, McCrea was required to disclose the physicians' reports within fifteen days of receiving them. Consequently, the motion requested that the ALJ exclude the reports and testimony of the three physicians, or alternatively, grant "additional time" after the February 7 hearing to depose the physicians and present additional evidence. On or about January 30, 1997, Mullens filed a separate "Motion to Continue Hearing" alleging that he had not had sufficient time to review the reports and prepare adequate cross-examination prior to the hearing. On February 6, 1997, the ALJ granted the request for a continuance and provided that the matter could be reset at a later time.
In October 1997, the claimant filed an application for hearing listing the issues of death benefits, penalties under § 8-43-304(1) for McCrea's alleged violation of Rule XI (B)(2), and "sanctions under C.R.C.P. 37 including the preclusion of testimony and/or evidence." Subsequently, an order was entered "bifurcating" the issues of death benefits and penalties.
On March 12, 1998, the matter proceeded to a hearing on the claimant's request for imposition of penalties against McCrea based on the alleged violation of Rule XI (B) (2), Rule VIII (E) (3), 7 Code Colo. Reg. 1101-3 at 24, and imposition of sanctions for discovery violations under C.R.C.P. 37. During the course of the hearing, the ALJ orally ruled that no penalty could be imposed on McCrea for violation of Rule XI (B) (2) because McCrea presented a "rational argument" that the three physicians' reports did not constitute "medical reports" within the meaning of Rule XI (B) (2). (Tr. pp. 73, 109). However, the ALJ did not issue an oral ruling on penalties for violation of Rule VIII (E) (3) or discovery sanctions.
At the conclusion of the hearing, counsel representing McCrea and Hewlett Packard inquired whether she could prepare a written order memorializing the ALJ's oral ruling that McCrea made a rational argument prohibiting the imposition of penalties under Rule XI (B) (2). The ALJ directed McCrea's counsel to prepare the order, and also directed the establishment of a briefing schedule concerning the remaining issues. (Tr. pp. 109-111).
By letter dated March 23, 1998, counsel for McCrea submitted proposed findings of fact and conclusions of law dismissing the claim for penalties based on violation of Rule XI (B) (2) and directing the claimant to file a written argument concerning the remaining issues.
On March 26, 1998, Mullens wrote to the ALJ expressing confusion concerning the proposed order. Mullens stated that it was "my understanding that I have thirty days from March 12, 1998 in which to submit a brief position statement and proposed order on all issues, including whether Mr. McCrea is liable for sanctions under § 8-43-304 for failure to comply with Rule XI (B) (2)."
By letter dated April 2, 1998, the ALJ replied to Mullens' letter of March 26. The ALJ stated that at the March 12 hearing she denied penalties against McCrea based on her finding that he presented a rational argument concerning the "alleged difference between physician's [sic] reports and medical reports." However, the ALJ went on to state that "all other issues including potential violations under Rule 37 were reserved to be addressed pursuant to the briefing schedule." Despite the ALJ's April 2 letter, Mullens then filed a "Position Statement" which addressed all issues including penalties for violation of Rule XI (B) (2).
On April 16, 1998, the ALJ entered a "Procedural Order." The order notes that the issues to be decided at the March 12 hearing included "potential sanctions to be imposed against attorney McCrea for failure to provide discovery to claimant in a timely manner as well as Mr. McCrea's alleged failure to comply with Rule XI (B) (2)." In paragraph 1, the order states that the claimant was granted thirty days from March 12, 1998, to submit a proposed position statement "on all issues currently before the Court referred to above." (Emphasis added). Paragraph 2 of the order states that following receipt of the respondents' answer briefs, the ALJ intends to enter an order "on all issues not ruled on from the bench on March 12, 1998 including whether Mr. McCrea has violated an obligation to update the provision of discovery information . . . and potential sanctions for failure to update provision of discovery." Paragraph 3 of the order states that "Penalties against Mr. McCrea under § 8-43-304, C.R.S. pursuant to Rule XI (B) (2) are denied." Following entry of the April 16 order, counsel for claimant did not request specific findings of fact and conclusions of law.
On June 10, 1998, the ALJ entered a Summary Order. The Summary Order denied additional sanctions under C.R.C.P. 37 because the ALJ had continued the February 7 hearing, denied imposition of penalties for violation of Rule VIII (E) (3), and noted that the ALJ previously dismissed the claim for penalties under Rule XI (B) (2). Counsel for claimant then filed a timely request for specific findings of fact and conclusions of law.
On July 6, 1998, the ALJ entered Specific Findings of Fact, Conclusions of Law, and Order. The ALJ first concluded that because the claimant "took no further action to perfect an appeal of the April 16, 1998 order," the order became "final." Consequently, the ALJ did not address the merits of the claimant's request for penalties based on McCrea's alleged violation of Rule XI (B) (2).
The ALJ next denied the claim for penalties against McCrea based on the alleged failure to supplement discovery as required by Rule VIII (E) (3). The ALJ ruled that sanctions for failure to make discovery are explicitly provided in § 8-43-207(1)(e), C.R.S. 1998, which states that an ALJ "may rule on discovery matters and impose the sanctions provided in the rules of civil procedure in the district courts for willful failure to comply with permitted discovery." Relying on Sears v. Penrose Hospital, 942 P.2d 1345 (Colo.App. 1997), the ALJ reasoned that because § 8-43-207(1)(e) provides for specific discovery sanctions, the general penalty provisions of § 8-43-304(1) do not apply.
Finally, the ALJ denied the claimant's request to preclude the reports or testimony of Drs. Kinsman, Gutterman, and Repsher under C.R.C.P. 37. The ALJ concluded that granting the continuance of the hearing scheduled for February 7 constituted a sufficient remedy for any discovery violation, and declined to impose the "extreme sanction" of witness preclusion. The ALJ also found that McCrea's conduct was not "willful," and therefore concluded that no sanction could be imposed under § 8-43-207 (1)(e) and C.R.C.P. 37.
I.
On review, the claimant first contends the ALJ erroneously held that her failure to request specific findings of fact and conclusions of law following the April 16 order precludes review of her claim for penalties based on McCrea's alleged violation of Rule XI (B) (2). The claimant argues that the April 16 "Procedural Order" does not constitute a "summary order" for purposes of § 8-43-215, C.R.S. 1998, because the ALJ did not sign the proposed order submitted by McCrea's counsel on March 28, because the April 16 order "appears to grant the Claimant's request to file a position statement on all the issues," and because the claimant sought "reconsideration of both the oral rulings at hearing and the letter issued subsequent to hearing." Alternatively, the claimant argues that the April 16 order was misleading and the confusion excuses her failure to request specific findings. We disagree with these arguments.
Section 8-43-215 states that at the conclusion of the hearing the ALJ "shall make a summary order allowing or denying said claim." Then, within "fifteen working days after the conclusion of such hearing, the administrative law judge or director shall reduce such order to writing." The statute goes on to provide as follows:
"Any party dissatisfied with a summary order may request specific findings of fact and conclusions of law in writing within fifteen days after the date of the certificate of mailing of the summary order. Such request shall be a prerequisite to a petition to review under section 8-43-301, and such request shall stay the time within which to file a petition to review until after the mailing of the specific findings and conclusions."
The procedural filing requirements of the Workers' Compensation Act are jurisdictional, and therefore, strictly construed. Schneider National Carriers, Inc. v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 98CA0393, November 27, 1998). In view of this rule, we have previously held that failure timely to request specific findings of fact and conclusions of law is jurisdictional and fatal to a request for further review. Royce v. Bullwhacker's Casino, W. C. No. 4-244-932 (July 25, 1996).
Here, it is undisputed that the claimant failed to request specific findings of fact and conclusions of law within fifteen days of the April 16 "Procedural Order." Thus, the question presented is whether the April 16 order constituted a summary order, within the meaning of § 8-43-215, with respect to the issue of penalties for violation of Rule XI (B) (2).
Initially, we note that the ALJ's denomination of the April 16 order as a "Procedural Order" is not decisive. Section 8-43-215 does not contain any requirement concerning the label to be attached to the written order. Compare § 8-43-301(5), C.R.S. 1998 (stating that a "supplemental order labeled as such" may be entered by the ALJ). In any event, it is the substance of the order, not the caption, which governs its legal significance.
The April 16 order memorializes an oral order issued at the March 12 hearing. Further, the April 16 order explicitly provides that the claim for penalties based on the alleged violation of Rule XI (B) (2) was resolved at the March 12 hearing, and unequivocally dismisses that claim in paragraph 3. The claimant's assertions notwithstanding, paragraph 1 of the order is not confusing because it refers to briefing all issues "currently" before the court. Under these circumstances, the record does not support the claimant's assertion that she did everything possible to preserve her rights, and was confused concerning the significance of the April 16 order. Moreover, the import of the April 16 order could not have been in doubt following the ALJ's April 2 letter explaining the procedural posture of the case.
It may be, as the claimant argues, that the ALJ's action in issuing a summary order on only one of the pending issues has the effect of causing "piecemeal" review. However, since the time limit for issuing a written summary order is not jurisdictional, we perceive no prohibition against issuing a written summary order on some issues and reserving determination on other issues. See Langton v. Rocky Mountain Healthcare Corp., 937 P.2d 883 (Colo.App. 1996). Further, it is not uncommon for an ALJ's order to be final and reviewable in some respects, but not final in other respects. Cf. United States Fidelity Guaranty, Inc. v. Kourlis, 868 P.2d 1158 (Colo.App. 1994).
Neither are we persuaded that the claimant was misled so as to require application of the "unique circumstances" rule described in Converse v. Zinke, 635 P.2d 882 (Colo. 1981). In Converse, a judge orally advised counsel that he would have fifteen days to file motions for post-trial relief. However, the applicable rule of procedure required post-trial motions to be filed within ten days. Under these circumstances, the Converse court allowed the late filing stating that the "unique circumstances" exception to jurisdictional requirements applies where a "party reasonably relies and acts upon an erroneous or misleading statement or ruling by a trial court regarding the time for filing post-trial motions." Id. at 886.
Here, we find no basis for concluding that the claimant "reasonably relied" on any "erroneous or misleading statement or ruling" of the ALJ concerning the necessity for filing a request for specific findings of fact and conclusions of law. To the contrary, the ALJ's April 2 letter explicitly set forth the procedural posture of the case, and reiterated that the ALJ had orally dismissed the claim for penalties based on violation of Rule XI (B) (2). Further, the April 16 order explicitly dismissed the claim for penalties, and directed the filing of a brief on other issues not ruled upon by the ALJ. Thus, there is no basis for holding that the ALJ did anything to mislead counsel concerning her intent to issue a written summary order dismissing the claim for penalties based on violation of Rule XI (B) (2).
In light of this ruling, we need not address the claimant's substantive arguments concerning the denial of penalties for violation of Rule XI (B) (2).
II.
The claimant next contends the ALJ erred in failing to impose penalties under § 8-43-304(1) based on McCrea's failure to supplement discovery as required by Rule VIII (E) (3). The claimant reasons that the ALJ could not have concluded that the proper sanctions for violation of Rule VIII (E)(3) are found in C.R.C.P. 37 when she previously ruled that it was inappropriate to impose any penalties for alleged discovery violations under C.R.C.P. 26. We find no error.
Section 8-43-304(1) provides for imposition of a penalty up to $500 per day when a party "fails or refuses to perform any duty lawfully enjoined within the time prescribed by the director or panel, for which no penalty has been specifically provided." Violation of a Rule of Procedure falls within the ambit of this statute if it imposes a duty to act. See Pueblo School District No. 70 v. Toth, 924 P.2d 1094 (Colo.App. 1995). However, where the "gravamen of the disputed conduct is a violation of the Act or a violation of a rule enacted by the director, the penalty set forth in § 8-43-304(1) applies only when the act does not create a specific penalty for the violation." Sears v. Penrose Hospital, 942 P.2d at 1347.
Here, as the ALJ correctly observed, § 8-43-207(1)(e) provides for the imposition of "sanctions" for failure to "comply with permitted discovery." Rule VIII (E) (3) is a form of "permitted discovery." The sanctions to which the statute refers are those found in C.R.C.P. 37. See Scheid v. Hewlett Packard, 826 P.2d 396 (Colo.App. 1991). Thus, the Act creates a wide array of possible punishments for discovery violations, including monetary and non-monetary sanctions. Under these circumstances, no separate discovery penalty may be imposed under § 8-43-304(1). Sears v. Penrose Hospital, supra.
The claimant asserts that the ALJ's ruling cannot be correct because the ALJ also ruled, in response to an argument by the claimant, that C.R.C.P. 26 does not apply to pre-hearing disclosure in workers' compensation cases. However, we perceive no inherent inconsistency in the ALJ's ruling concerning C.R.C.P. 26 and her ruling concerning C.R.C.P. 37 sanctions for violation of Rule VIII (E) (3). The ALJ's ruling concerning C.R.C.P. 26 constituted a determination that the prehearing disclosure requirements of C.R.C.P. 26 are greater than those imposed by Rule of Procedure VIII, and therefore, C.R.C.P. 26 is inapplicable in workers' compensation proceedings. See Nova v. Industrial Claim Appeals Office, 754 P.2d 800 (Colo.App. 1988) (rules of civil procedure apply in workers' compensation only insofar as they are consistent with the procedure and practice provided by the Act). However, § 8-43-207(1)(e) expressly incorporates the sanctions for discovery violations contained in C.R.C.P. 37, and to that extent C.R.C.P. 37 is not inconsistent with the Act.
In light of our conclusion that no penalty under § 8-43-304(1) is appropriate for violation of Rule VIII (E) (3), we need not consider the claimant's other arguments concerning the propriety of the ALJ's order.
We recognize that in Gillette v. Burlington Coat Factory, W.C. No. 4-231-877 (November 12, 1998), we upheld an order awarding penalties under § 8-43-304(1) for failure to comply with an order to make discovery. However, in Gillette, no argument was made concerning the applicability of § 8-43-304(1) in light of § 8-43-207(1)(e). Consequently, Gillette, did not consider this question and is not persuasive here.
III.
The claimant's final contention is that the ALJ erred in failing to order the exclusion of the reports and testimony of the three doctors as a sanction for McCrea's alleged violation of Rule VIII (E) (3). We conclude that this portion of the ALJ's order is not currently subject to review.
Section 8-43-301(2), C.R.S. 1998, provides that a party may file a petition to review concerning an order "which requires any party to pay a penalty or benefits or denies a claimant any benefit or penalty." The question presented is whether the ALJ's refusal to preclude the testimony of the three doctors constitutes the denial of a "penalty" for purposes of this statute.
The term "penalty," as used in § 8-43-301(2), has been construed to mean "statutory sanctions imposed on a party for the failure to obey orders of the Panel or adhere to mandatory procedural requirements." BCW Enterprises, Ltd. v. Industrial Claim Appeals Office, 964 P.2d 533 (Colo.App. 1997). In BCW Enterprises, the court held that denial of a "fee award" imposed under § 8-43-211(1)(d), C.R.S. 1998, would constitute denial of a "penalty" for purposes of the statute. Thus, in some sense, the ALJ's refusal to exclude testimony at the upcoming hearing on death benefits could be viewed as the denial of a "penalty."
However, it has also been held that an order involving discovery does not impose a penalty, at least where the order does not "mandate the payment of a sum of money" for violation of an order or for refusal to perform a duty. See American Express v. Industrial Commission, 712 P.2d 1132, 1134 (Colo.App. 1985). It is for this reason that we have previously held that "orders concerning procedural issues, including discovery matters, do not satisfy the statutory definition of an appealable order." See Jones v. Chicken-N-Pasta, W.C. No. 4-197-841 (February 3, 1995) (order denying motion for protective order was not reviewable).
Here, the specific relief which the claimant seeks on appeal, namely an order precluding the testimony of witnesses, does not involve denial of any monetary fees or costs. Rather, the claimant is seeking an order overruling the ALJ concerning the admissibility of evidence at a pending hearing. Although the ALJ's decision to admit testimony may constitute the denial of a discovery "sanction," that denial does not rise to the level of a "penalty" for purposes of § 8-43-301(2). To hold otherwise would require us to engage in pre-hearing review of numerous discovery sanctions including the preclusion of defenses, the exclusion of evidence, and the granting or denying of continuances. Such pre-hearing intervention is particularly unreasonable since the result of the hearing may render the ruling moot.
In reaching this result, we do not preclude the possibility that the imposition or denial of some monetary sanctions, such as an award of attorney fees and costs, may be appealable under § 8-43-301(2). Similarly, dismissal of a claim as a form of discovery sanction would be appealable because it denies all benefits. See Scheid v. Hewlett Packard, supra.
IT IS THEREFORE ORDERED that the ALJ's order dated July 6, 1998, is affirmed insofar as the ALJ declined to impose penalties under § 8-43-304(1) based on McCrea's alleged violation of Rule XI (B) (2).
IT IS FURTHER ORDERED that the ALJ's order is affirmed insofar as the ALJ declined to impose penalties under § 8-43-304(1) based on McCrea's alleged violation of Rule of Procedure VIII (E) (3).
IT IS FURTHER ORDERED that the claimant's petition to review is dismissed without prejudice with respect to the ALJ's refusal to preclude the testimony and reports of the three doctors.
INDUSTRIAL CLAIM APPEALS PANEL
________________________________ David Cain
________________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate the 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, with service of a copy of the petition upon the Industrial Claim Appeals Office and all other parties, within twenty (20) days after the date the Order was mailed, pursuant to §§ 8-43-301(10) and 307, C. R. S. 1998.
Copies of this decision were mailed January 12, 1999 to the following parties:
Jacqueline Reed, 3122 Firewood Dr., Colorado Springs, CO 80918
Hewlett Packard, Attn: Sylvia Harding, R.N., P.O. Box 7050, Colorado Springs, CO 80933-7050
Liberty Mutual Insurance Company, Attn: Leona Zuffoletto, 13111 E. Briarwood Ave., Suite 100, Englewood, CO 80112
Steven U. Mullens, Esq., P.O. Box 2940, Colorado Springs, CO 80901-2940 (For Claimant)
Margaret Keck, Esq., 1777 S. Harrison St., Suite 1110, Denver, CO 80210 (For Respondent Hewlett Packard and McCrea)
Scott M. Busser, Esq., 300 S. Jackson St., Suite 570, Denver, CO 80209 (For Respondent Liberty Mutual Insurance Company)
Andrew Katarikawe, Esq., Assistant Attorney General, 1525 Sherman St., 5th floor, Denver, CO 80203
By: ___________