Opinion
W.C. No. 4-773-953.
September 11, 2009.
ORDER OF REMAND
The claimant seeks review of an order of Administrative Law Judge Walsh (ALJ) dated April 30, 2009, to the extent that it ordered the respondents to pay a penalty in the amount of $4,000. We set aside the penalty portion of the order and remand for entry of a new order that provides more specific calculations of the penalties.
The ALJ made the following findings of fact, which are not in dispute on appeal. The claimant suffered a compensable foot injury caused by his work duties on May 31 and June 1, 2008. The employer had written notice of the injury and the claimant's physical restrictions on June 3, 2008. The ALJ found that the respondents should have filed a First Report of Injury no later than June 15, 2008, but had not done so even up to the time of entry of the ALJ's order. Therefore, the respondents violated § 8-43-101 C.R.S. 2009 and W.C. Rule of Procedure 5-2, 7 Code Colo. Reg. 1101-3 (2009). The insurer had notice of the lost time claim no later than October 24, 2008 when it received an application for hearing. The respondents should have filed an admission or denial of the claim no later than July 5, 2008. However, the Notice of Contest was not filed until February 18, 2009. Therefore, the respondents were in violation of § 8-43-203 C.R.S. 2009 and Rule of Procedure 5-2. The respondents' failure to file a First Report of Injury and failure to file an admission or denial were not objectively reasonable. The ALJ ordered the respondents to pay a penalty in the amount of $4,000 of which $3,000 was payable to the claimant and $1,000 was payable to the Subsequent Injury Fund.
The claimant brings this appeal requesting that the matter be remanded to the ALJ for additional findings. The claimant contends that the amount of the penalties imposed by the ALJ constitutes an abuse of discretion and that the ALJ's findings on the amount of penalties are insufficient to permit appellate review. We initially note that we may not disturb the ALJ's determination of the amount of the penalty to be imposed in the absence of fraud or an abuse of discretion. See Hall v. Home Furniture Co., 724 P.2d 94 (Colo. App. 1986); Brunetti v. Industrial Commission, 670 P.2d 1246 (Colo. App. 1983). However, in our opinion the matter must be remanded.
Section 8-43-203(1)(a) C.R.S. 2009 provides that the employer or, if insured, the employer's insurance carrier shall notify in writing the Division and the injured employee whether liability is admitted or contested. Section 8-43-203(2)(a) provides that if such notice is not filed the employer's insurance carrier may become liable to the claimant for up to one day's compensation for each day's failure to so notify. Fifty percent of any penalty paid pursuant to § 8-43-203(2)(a) shall be paid to the Subsequent Injury fund and fifty percent to the claimant.
Section 8-43-101, C.R.S. 2009 requires every employer to report injuries for lost time or injuries resulting in permanent physical impairment to the Division within ten days after notice or knowledge of the same. There is no specific penalty provided for violation of § 8-43-101. The ALJ assessed penalties under § 8-43-304 C.R.S. 2009 based on the employer's failure to file a first report of injury as required by § 8-43-101(1) and Rule of Procedure 5-2. Section 8-43-304 authorizes an ALJ to impose a penalty of up to $500 per day for each day a party violates any provision of the Workers' Compensation Act, fails or refuses to perform any duty lawfully enjoined within the time prescribed by the director, or refuses to obey any lawful order made by the director or the panel. Seventy-five percent of the penalty under § 8-43-304 is payable to the aggrieved party and twenty-five percent to the subsequent injury fund.
The ALJ first determined that the respondents' conduct violated both § 8-43-203(1)(a) and § 8-43-101. The ALJ also found that the respondents' conduct violated Rule of Procedure 5-2. The ALJ then determined that the respondents' actions were not objectively reasonable. This is the correct two-step process for imposition of penalties. See Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, 907 P.2d (Colo. App. 1995).
Nevertheless, we conclude the ALJ's findings of fact are insufficient to permit appellate review of the claimant's contention that the ALJ's imposition of penalties was an abuse of discretion. See Davila v. CF I Steel Corporation W.C. No. 4-343-840 (November 15, 1999). An abuse of discretion occurs when an ALJ's order is beyond the bounds of reason, as where it is unsupported by the law or the facts. Coates, Reid Waldron v. Vigil, 856 P.2d 850 (Colo. 1993).
Although the amount of the penalty is discretionary for violation of § 8-43-203(1)(a) and § 8-43-101, the ALJ's findings must be sufficient to indicate the basis of the order. Riddle v. Ampex Corp., 839 P.2d 489 (Colo. App. 1992). Further, the findings should not be stated in a purely conclusionary form which affords no meaningful basis to review the findings. Womack v. Industrial Commission, 168 Colo. 364, 451 P.2d 761 (1969).
Here the ALJ combined the penalties he imposed under § 8-43-304(1) for failure to report the injury to the Division within ten days as required by § 8-43-101 with the penalties he imposed for the respondents' failure to admit or deny as required by § 8-43-203(1)(a). The ALJ made a general award of $4,000. The ALJ penalties under § 8-43-304(1) allows for penalties up to $500 a day for failure to report the injury as required by § 8-43-101. In contrast penalties for failure to admit or deny as required by § 8-43-203(1)(a) allows for up to one day's compensation for each day's failure to admit or deny. We can not tell from the order what portion of the $4,000 is imposed for violation of § 8-43-101 and what portion is awarded for violation of § 8-43-203(1)(a). Further, we can not tell the basis for the award of $1000, to the Subsequent Injury Fund since the percentage of the penalty due the Subsequent Injury Fund varies from twenty-five percent of the penalty awarded under § 8-43-304(1) to fifty percent of any penalty paid pursuant to § 8-43-203(2)(a).
Accordingly, the ALJ's order is insufficient for us to ascertain the basis for the ALJ's imposition of penalties. On remand, the ALJ shall enter a new order with specific findings to support the ALJ's conclusion concerning the appropriate daily rate of the penalties imposed for the respondents' failure to timely report the injury and failure to file timely an admission or denial.
IT IS THEREFORE ORDERED that the ALJ's order dated April 30, 2009 is set aside, and the matter is remanded for further proceedings and entry of a new order consistent with the views expressed herein.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________
John D. Baird
______________________________
Thomas Schrnt
ROGER COX, TRINIDAD, CO, (Claimant).
PIONEER NATURAL RESOURCES, Attn: RON SCHINDLER, DENVER, CO, (Employer).
LIBERTY MUTUAL INSURANCE COMPANY, Attn: SHARON R JACKSON, LAS VEGAS, NV, (Insurer).
WILLIAM A ALEXANDER JR PC, Attn: MS. CHARLOTTE VEAUX, ESQ., COLORADO SPRINGS, CO, (For Claimant).
LAW OFFICE OF RICHARD P MYERS, Attn: APRIL MOORE, ESQ., DENVER, CO, (For Respondents).
PIONEER NATURAL RESOURCES, INC., Attn: MICHELE BENNETT/KIMBERLY BURKE, IRVING, TX, (Other Party).