Opinion
W.C. No. 4-636-107.
November 4, 2009.
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Cannici (ALJ) dated May 28, 2009, that permitted the respondent to recover an overpayment of $546.14 from the claimant and that denied the claimant's claim for penalties. We affirm.
A hearing was held on the issues of whether the claimant had been overpaid, and if so, whether the respondent was entitled to recover the overpayment, and whether the respondent was liable for statutory penalties for its failure to correctly pay benefits. Following the hearing the ALJ entered findings of fact that for the purposes of this order may be summarized as follows. The claimant sustained a compensable injury to her right shoulder on December 8, 2004. At various times she received both temporary total and temporary partial disability benefits. She reached maximum medical improvement twice and underwent two Division-sponsored independent medical examinations (DIME). Her last date of maximum medical improvement was September 14, 2007, and on March 4, 2008 the respondent filed a final admission of liability admitted for the rating in Dr. Lindbergh's DIME report. The final admission also noted an overpayment of $4,979.89. The claimant objected to the final admission and sought a hearing on the issues whether she was permanently and totally disabled and whether her extremity impairment rating should be converted to a whole person impairment rating.
On October 23, 2008 ALJ Krumreich issued an order denying permanent and total disability benefits, but converting the claimant's extremity rating to a whole person rating. The order stated that "[r]espondents are entitled to credit for all amounts of permanent partial benefits previously paid pursuant to the Final Admission of March 4, 2008."
On November 14, 2008 the respondent filed a final admission admitting for permanent partial disability benefits based upon a 14 percent whole person impairment rating in the amount of $25,446.05. The final admission also noted that an overpayment existed in the amount of $13,363.81, leaving a balance to be paid of $12,082.24. On November 14, 2008 the respondent paid to the claimant a lump sum in the amount of $9617.11, which represented the respondent's liability for permanent partial disability benefits from February 26, 2008 through November 20, 2008.
At the claimant's request, the respondent recalculated the benefits admitted for in the November 14th final admission. The respondent reviewed the "payment log" and issued a new final admission on March 6, 2009, which asserted that the claimant was overpaid $546.14. The Division sent two "error letters" to the respondent, pointing out errors in the calculations contained in the final admission. The respondent corrected the errors and issued a new final admission on March 20, 2009, again asserting an overpayment of $546.14.
The ALJ also credited the testimony of the respondent's claims representative, Helen Sullivan, who stated that the "only method" to use to calculate an overpayment is to calculate the actual payments that had been made and compare that amount to the benefits owed on the claim. The ALJ found that the insurer's payment log reflects that permanent partial disability benefits had been paid in the amount of $16,319.32. When the amount paid for disfigurement is subtracted from that amount the total permanent partial disability benefits paid was $15,519.32. When the amount paid in temporary total and partial disability benefits is added to that amount, the total of indemnity benefits paid is $60,201.58. The ALJ found that the total amount owed in temporary disability benefits and permanent partial disability benefits is $59,655.44. The ALJ further found that subtracting that amount from the total paid results in an overpayment of $546.14.
Based on his factual findings, the ALJ concluded that the respondent had proved that the claimant was overpaid in that amount. The ALJ rejected the claimant's argument that the respondent was precluded by ALJ Krumreich's order from asserting an overpayment. The ALJ also found that the claimant had failed to show that she was entitled to statutory penalties for the respondent's alleged failure to pay permanent partial disability benefits properly.
The claimant appealed the ALJ's order and makes several arguments. First, the claimant argues that the ALJ erred in concluding that ALJ Krumreich's order was not the law of the case and did not preclude the respondent from asserting an overpayment. In connection with this argument, the claimant asserts that ALJ Krumreich issued an order requiring the respondent to pay permanent partial disability benefits, and that the order became final when no party appealed it. The claimant asserts that issue preclusion bars the relitigation of any issue that was actually decided in the final order, and also any issue that could have been raised at that time. The claimant argues that at the time the proper award of permanent partial disability benefits was being adjudicated the respondent could have raised any alleged overpayment, and their failure to do so precludes them from later raising that issue. We are unpersuaded by this argument.
The claimant refers both to the doctrine of the "law of the case" and to that of "issue preclusion." In our view the former has no applicability here. The law of the case doctrine is a discretionary rule, which provides that legal issues that have been litigated and decided ordinarily should not be relitigated in the same proceeding. Verzuh v. Rouse, 660 P.2d 1301 (Colo. App. 1982). The doctrine applies to decisions of law rather than to the resolution of factual questions. Mining Equipment v. Leadville Corp., 856 P.2d 81, 85 (Colo. App. 1993). Accordingly, an ALJ may preclude the relitigation of a legal issue, which has been previously resolved in the same action. The purpose of the law of the case doctrine is efficiency of disposition, and if the prior ruling results in error or is no longer sound because of changed conditions, then the doctrine should not apply. People v. Roybal, 672 P2.d 1003 (Colo. 1983). Here, the questions whether an overpayment exists and, if so, its amount, are largely factual ones. We perceive no prior legal ruling that resolves this issue and therefore there is no "law of the case" that governed this ALJ's resolution of the overpayment issue.
The claimant also contends that issue preclusion barred the relitigation of the question whether an overpayment existed. Issue preclusion refers to a court's final decision on an issue actually litigated and decided in a previous suit as being conclusive of that issue in a subsequent suit. See Estate of Scott v. Holt, 151 P.3d 642 (Colo. App. 2006) citing Rantz v. Kaufman, 109 P.3d 132 (Colo. 2005). Issue preclusion is an equitable doctrine that bars relitigation of an issue that has been finally decided by a court in a prior action. Bebo Construction Co. v. Mattox O'Brien, 990 P.2d 78, 84 (Colo. 1999). Its purpose is to relieve parties of the burden of multiple lawsuits, to conserve judicial resources, and to promote reliance upon and confidence in the judicial system by preventing inconsistent decisions. Id. Although issue preclusion originated as a judicial doctrine, it has been extended to administrative proceedings, where it "may bind parties to an administrative agency's findings of fact or conclusions of law." Sunny Acres Villa, Inc. v. Cooper, 25 P.3d 44, 47 (Colo. 2001). See also Holnam, Inc. v. Industrial Claim Appeals Office, 159 P.3d 795 (Colo. App. 2006). The supreme court has stated that:
Issue preclusion bars relitigation of an issue if: (1) the issue sought to be precluded is identical to an issue actually determined in the prior proceedings; (2) the party against whom estoppel is asserted has been a party to or is in privity with a party to the prior proceeding; (3) there is a final judgment on the merits in the prior proceeding; and (4) the party against whom the doctrine is asserted had a full and fair opportunity to litigate the issue in the prior proceeding.
Sunny Acres Villa, Inc., 25 P. 3d at 47.
Here, it is undisputed that the identical issue has not actually been determined in a prior proceeding. However, the claimant contends that because the respondent could have litigated the overpayment issue at the time ALJ Krumreich adjudicated the extent of permanent disability the respondent is now barred from raising the issue. We disagree that the respondent could have litigated the identical issue before ALJ Krumreich in the prior proceeding. The issues adjudicated by ALJ Krumreich were whether the claimant was permanently and totally disabled and, if not, whether her permanent partial disability should be paid based upon a whole person impairment rating or an extremity impairment rating. Here, the ALJ found that the overpayment resulted from the total payments of indemnity benefits exceeding the respondent's total liability for indemnity benefits by $546.14. In our view, that issue could not have been ripe prior to the time the respondent's liability for permanent disability benefits was fixed by ALJ Krumreich's order. Although the respondent at that time might have litigated the issue whether any overpayment existed then, it would not have been the "identical" issue litigated before ALJ Cannici regarding the amount of the overpayment after other sums had been paid. Accordingly, we reject the claimant's argument that the respondent was precluded from raising and litigating this issue.
We also disagree with the claimant's argument that the ALJ was barred from adjudicating the existence of the overpayment absent a petition to reopen filed by the respondent. It appears from the record that the respondent's latest final admission of liability was filed on March 20, 2009. The final admission asserted an overpayment, apparently based upon the respondent's having paid temporary disability benefits after the claimant's ultimate date of maximum medical improvement. The claimant objected to the final admission, specifically asserting that the respondent had not properly paid permanent disability benefits and, at least implicitly challenging the respondent's assertion of an overpayment. In our view, this specific objection to the respondent's payment of permanent partial disability benefits kept open the issue whether those benefits had been correctly paid. That issue encompasses the questions whether the benefits had, as the claimant contended been underpaid, or had, as the respondent contended, been overpaid. See Section 8-43-203(2)(b)(II), C.R.S. 2009 (providing the procedure for objecting to and for closing issues admitted to or denied in a final admission). See also Vigil v. Jefferson County, W.C. No. 3-993-995 (January 7, 2003) (written objection must be specific regarding issues); Campello v. Progressive Insurance Co., W.C. No. 4-205-461 (January 27, 2003) (same).
We also reject the claimant's argument that the statutory definition of an "overpayment" does not include the present circumstances. Section 8-40-201(15.5), C.R.S. 2009 defines an overpayment as "money received by a claimant that exceeds the amount that should have been paid, or which the claimant was not entitled to receive, or which results in duplicate benefits because of offsets that reduce disability or death benefits payable under said articles." The claimant argues that the phrase beginning "because of offsets. . ." modifies all three of the foregoing definitions. Therefore, because the present overpayment did not result from an "offset," the claimant argues that it is not a statutory "overpayment" that may be recovered.
The claimant apparently concedes, however, that this identical argument was resolved against her in Simpson v. Industrial Claim Appeals Office, ___ P.3d ___ (Colo. App. No. 07CA1581, April 16, 2009). In Simpson the court of appeals held that the claimant's argument interpreted the statutory language "too narrowly." The court held that the legislature's use of the disjunctive "or" to set apart the three categories of overpayments indicated its intent that only the last involved statutory offsets. The claimant notes here that a petition for certiorari review is pending before the Colorado Supreme Court in Simpson, and she argues that it was wrongly decided. We disagree; however, in any event, we are bound by the published decisions of the court of appeals.
Finally, we reject the claimant's argument that the ALJ's order "must be reversed and remanded" because the respondent failed to comply with ALJ Krumreich's order to pay permanent partial disability benefits. Indeed, this was the factual issue resolved by the ALJ here and we have no authority to reweigh the record and enter our own findings of evidentiary fact. The ALJ's factual finding that the respondent paid all the indemnity benefits to which the claimant was entitled is amply supported by substantial evidence in the form of the testimony of the claims adjuster. Therefore, we have no authority to disturb those factual findings. Section 8-43-301(8), C.R.S. 2009. Further, we perceive no legal error in the ALJ's order. In this regard, we note that Workers' Compensation Rule of Procedure 5-6(D) provides that "[a]n insurer shall receive credit against permanent disability benefits for any temporary disability benefits paid beyond the date of maximum medical improvement." In our view this rule evidences the Director's intent that credit for temporary total disability benefits paid after maximum medical improvement is automatically afforded a respondent. Therefore, ALJ Krumreich's order did not need to specifically address this issue in order to preserve the respondent's right to assert an overpayment of temporary total disability benefits.
It follows that we perceive no basis on which to disturb the ALJ's conclusion that the respondent did not violate any statute, rule, or order that would justify penalties pursuant to § 8-43-304, C.R.S. 2009. The imposition of penalties under § 8-43-304(1) requires an initial determination that a party has violated the Act in some manner, or failed to carry out a lawfully enjoined action, or violated an order. If no violation is found, penalties may not be imposed pursuant to § 8-43-304. See Allison v. Industrial Claim Appeals Office, 916 P.2d 623 (Colo. App. 1995). Here, we perceive no error in the ALJ's determination that the respondent did not violate the law in asserting the existence of an overpayment of temporary total disability benefits.
IT IS THEREFORE ORDERED that the ALJ's order dated May 28, 2009, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Curt Kriksciun
____________________________________ Thomas Schrant
DEANNA JIRON, CASTLE ROCK, CO, (Claimant).
DOUGLAS COUNTY SCHOOL DISTRICT RE 1, Attn: TJ. CRAWFORD, CASTLE ROCK, CO, (Employer).
CHRIS FORSYTH LAW OFFICE, LLC, Attn: CHRIS FORSYTH, ESQ., DENVER, CO, (For Claimant).
CLISHAM, SATRIANA BISCAN LLC, Attn: PATRICIA CLISHAM, ESQ., DENVER, CO, (For Respondents).
CCMSI, Attn: HELEN SULLIVAN, GREENWOOD VILLAGE, CO, (Other Party).