Case Title: Smith v. State, Wyoming Workers Safety and Compensation Div.

Citation: 

Docket Number: 

State: wyoming

Court: Wyoming Supreme Court

Date: 1998-10-14T00:00:00Z

Document:
Smith v. State, Wyoming Workers Safety and Compensation Div.1998 WY 132965 P.2d 687Case Number: 97-290Decided: 10/14/1998Supreme Court of Wyoming

In 
the Matter of the Worker's Compensation Claim of Denise F. SMITH, Appellant 
(Petitioner),

v.

STATE of Wyoming, ex rel., WYOMING WORKERS' SAFETY 
AND COMPENSATION DIVISION, Appellee (Respondent).

 

Appeal from the District Court, 
Carbon County, Stebner, J.

 

R. Michael Vang of Kirkwood, 
Nelson & Vang, Laramie, for Appellant 
(Petitioner).

William U. Hill, Attorney 
General; John W. Renneisen, Deputy Attorney General; Gerald W. Laska, Senior 
Assistant Attorney General; and Bernard P. Haggerty, Assistant Attorney General, 
Cheyenne, for Appellee (Respondent).

 

Before LEHMAN, C.J., and THOMAS, MACY, GOLDEN and 
TAYLOR,* JJ.

 * Chief Justice at time of oral 
argument.

 

TAYLOR, 
Justice.

 [¶1] Appellant, Denise F. Smith (Smith), underwent 
surgery shortly after she accepted a permanent partial disability award. She 
then sought to re-institute her temporary total disability benefits, claiming 
her acceptance of permanent benefits was premised on her erroneous belief that 
it would not preclude her receipt of future temporary disability payments. 
Finding no cognizable "mistake" under Wyo. Stat. § 27-14-605(a) (1997), the 
hearing examiner denied her request. We affirm.

 

              
                               I. 
ISSUES

 

[¶2] Two questions were 
identified in the certification of this case by the district court pursuant to 
W.R.A.P. 12.09:

 

Following the repeal and rewriting of the Wyoming 
Workers' Compensation Act in 1986 and the decision in State ex rel. Workers' 
Compensation v. Jerding, 868 P.2d 244, 248-49 (Wyo. 1994), does a mistake 
pursuant to W.S. § 27-14-605(a) require a showing of a material mistake of fact 
made by the "fact finder"?

 

If 
it does not, did the Petitioner establish a mistake pursuant to W.S. § 
27-14-605(a), which would allow her to recover temporary total disability 
benefits for the time period that she had not been released to return to work 
and had not reached maximum medical improvement?

 

                                             
II. FACTS

 

[¶3] The following facts are 
recounted from the stipulated statement of facts attached to the district 
court's order certifying the case to this court. In July 1994, Smith suffered a 
compensable injury while at work. From September 1, 1994 through July 1, 1995, 
Smith received temporary total disability benefits (temporary benefits) pursuant 
to Wyo. Stat. § 27-14-404 (Cum.Supp. 1994). In August 1995, Smith's physician 
certified that she had reached maximum medical improvement, and the Wyoming 
Workers' Safety and Compensation Division (Division) issued a permanent partial 
disability award which Smith accepted. Her temporary benefits were then 
discontinued.

 

[¶4] Approximately three 
months later, Smith underwent additional surgery for her injury. The Division 
paid for her medical costs, but denied her application under Wyo. Stat. § 
27-14-404(b) for additional temporary benefits. Thus began a long and 
procedurally tortuous route to this court.

 

[¶5] Smith objected to the 
Division's determination, and at her first contested case hearing argued the 
Division was equitably estopped from denying her additional benefits. She 
asserted she misunderstood the limitations on further receipt of temporary 
benefits, and the misunderstanding was created by the Division in the last 
paragraph of its letter awarding permanent benefits.1 The hearing examiner rejected this 
argument, finding Smith had not returned to work as required for additional 
temporary benefits under Wyo. Stat. § 27-14-404(b), and that the Division's 
letter contained no misrepresentations regarding the availability of future 
benefits.  The hearing examiner 
noted that Smith's medical costs had been paid, and no request for benefits 
under Wyo. Stat. § 27-14-605(a) had been submitted. Therefore, the hearing 
examiner declined to address Smith's eligibility for additional benefits under 
that provision.

 

[¶6] Smith then filed an 
application for benefits based on a "mistake of fact" under Wyo. Stat. § 
27-14-605(a), which allows an extension or modification of benefits for 
"increase or decrease of incapacity due solely to the injury, or upon grounds of 
mistake or fraud."2 The Division denied Smith's 
application, and Smith again objected.

 

[¶7] At the initial 
contested case hearing to address this issue, Smith presented her own testimony 
and that of her doctor. Smith's doctor testified that at the same time he was 
doing Smith's impairment rating, he was also trying to evaluate her to determine 
if she would need a second surgery. He stated that when he made Smith's 
impairment rating, he did not believe she was at maximum medical improvement 
and, although not sure, he realized further surgery might be required. Smith's 
doctor further testified he was under the assumption his maximum medical 
improvement certification would have no effect on Smith's ability to receive 
future temporary benefits, and had he known, he would not have certified her at 
maximum medical improvement. Smith testified she discussed the possibility of 
surgery with her doctor while she was undergoing her impairment evaluation. She 
pointed out that the only reason she accepted the impairment award was because 
she believed she was automatically eligible for future disability benefits due 
to her original injury.

 

[¶8] The hearing examiner 
did not reach the merits of Smith's claim, however, finding that the claim was 
barred under the principles of res judicata and collateral estoppel because 
Smith failed to raise this issue at the first hearing. On appeal, the district 
court disagreed, and the case was remanded to the hearing examiner for an 
evidentiary hearing on the issue of mistake. The parties then stipulated as to 
the facts and agreed the hearing examiner may decide the issue on the basis of 
the stipulated facts and the parties' legal briefs.

 

[¶9] The hearing examiner 
issued an order denying benefits on August 20, 1997. Relying on our holding in 
Conn v. Ed Wederski Const. Co., 668 P.2d 649, 653 (Wyo. 1983), the hearing 
examiner found that Smith failed to meet her burden of showing that a mistake of 
material fact was made by the fact finder. Smith timely appealed, and this case 
was certified by the district court pursuant to W.R.A.P. 
12.09.

 

                                      
III. STANDARD OF REVIEW

 

[¶10] Although Smith refers 
to "certified questions" in her brief, this case is not limited to certified 
questions of law under W.R.A.P. 11, but comes before us as a certified case 
under W.R.A.P. 12. Judicial review of administrative action under W.R.A.P. 12.09 
is confined to "the issues set forth in the petition and raised before the 
agency" and is conducted in accordance with Wyo. Stat. § 16-3-114(c) (1997). 
Pursuant to Wyo. Stat. § 16-3-114(c)(ii)(A), the reviewing court will "[h]old 
unlawful and set aside agency action, findings and conclusions found to be * * * 
[a]rbitrary, capricious, an abuse of discretion or otherwise not in accordance 
with law[.]"

 

[¶11] An administrative 
agency's findings of fact will not be adjusted unless clearly contrary to the 
overwhelming weight of the evidence. Matter of Fritz, 937 P.2d 1345, 1348 (Wyo. 
1997). An agency's conclusions of law, however, are afforded no deference. If 
the agency's conclusions are correct, they are affirmed; if not, we correct 
them. Id.

 

                                          
IV. DISCUSSION

 

[¶12] The hearing examiner's 
conclusion at issue in this case is quite simple:

 

Smith has the burden to establish that a mistake of 
material fact was made by the fact finder. [Referring to Conn, 668 P.2d  at 653] 
She has failed to meet her burden. Smith was rated by Dr. Whipp, even though she 
was not at MMI [maximum medical improvement]. The Division accepted the rating 
and offered a physical impairment award. Smith accepted the award and it was 
paid. If Smith had problems with the award or felt it should not have been 
offered, she should have objected to it. By accepting the award, it was paid and 
Smith cannot now come back and argue it was improper or a mistake. Only error 
relating to material facts, not agency procedure may be challenged by a motion 
under Wyo. Stat. § 27-14-605 (1994). See [Matter of Worker's Compensation Claim 
of] Howton, 899 P.2d [869] at 871 [(Wyo. 1995)].

 

[¶13] In Conn, 668 P.2d  at 
653, we held that the term "mistake" in Wyo. Stat. § 27-14-605(a) applies to 
"those situations in which a mistake in the determination of a material fact has 
been made by a fact finder." On appeal, Smith claims the hearing examiner erred 
in applying this standard. Smith's argument rests solely on the proposition that 
the legislative change in 1986, transferring the determination of worker's 
compensation claims from a judicial to an administrative process, requires a 
departure from our ruling in Conn. Although somewhat convoluted, Smith 
apparently maintains that this result is necessarily implied by our recognition 
that, in some instances, the significant changes in the worker's compensation 
law accomplished in 1986 may affect the precedential value of previous 
decisions. See Tenorio v. State ex rel. Wyoming Workers' Compensation Div., 931 P.2d 234, 240 (Wyo. 1997) and State ex rel. Wyoming Workers' Compensation Div. 
v. Jerding, 868 P.2d 244, 248-49 (Wyo. 1994).

 

[¶14] We have never stated, 
however, that the shift of worker's compensation claims to an administrative 
process undermines all pre-1986 case law. To the contrary, an alteration in the 
existing interpretation of the worker's compensation statutes, based upon the 
shift to an administrative process, is compelled only in situations where 
pre-1986 common law is in irreconcilable conflict with the administrative scheme 
designed by the legislature. Tenorio, 931 P.2d  at 240. The party claiming that 
the prior law and the current system cannot co-exist has the burden of proof on 
such a claim.

 

[¶15] Here, Smith offers no 
coherent reason why the shift to an administrative system creates an 
irreconcilable conflict with our ruling in Conn, 668 P.2d 649. We note that the 
language of Wyo. Stat. § 27-14-605(a) is identical to its pre-1986 predecessor. 
It is difficult to see how one can draw the inference that the legislature 
intended to change the accepted interpretation of the statute when employing the 
same language. Further, we have consistently applied the Conn standard in 
post-1986 cases. See Matter of Worker's Compensation Claim of Howton, 899 P.2d 869, 871 (Wyo. 1995) and Matter of Warehime, 806 P.2d 292, 296 (Wyo. 1991). 
Smith does not argue that these cases were improperly decided or conflict with 
the purpose of the current system. Absent any alternative argument for a 
departure from our ruling in Conn, 668 P.2d 649, we find no error in the rule of 
law applied in the proceedings below.

 

[¶16] Neither do we find 
error in the hearing examiner's application of the facts to the law. This is not 
a case where the Division's decision was based on a mutual mistake of material 
fact, relying on an erroneous diagnosis by a health care provider, as was the 
case in Matter of Warehime, 806 P.2d  at 296 (error in vocational evaluation 
submitted by independent agency mistake of material fact). See also 8 Arthur 
Larson, Larson's Workers' Compensation Law, § 81.52(b) n. 74 (1998). Here, the 
doctor admitted that he knew Smith had not reached maximum medical improvement 
when he submitted the maximum medical improvement certification to the Division, 
but that he did so on the "mistaken" assumption that the certification made no 
difference in Smith's procurement of future benefits. Indeed, even Smith did not 
agree that she had reached maximum medical improvement at the time she accepted 
the permanent benefits, but testified she did not object to the permanent award 
solely because she thought she would receive additional temporary benefits if 
more surgery was necessary.

 

[¶17] Smith asserts the 
mistake of fact in this case can be described as follows: "Because the Appellant 
had not reached maximum medical improvement, there was not an ascertainable loss 
that would allow the Division to require the treating physician to perform an 
impairment rating and terminate the Appellant's [temporary] benefits * * *." In 
so arguing, Smith ignores the fact that she and her doctor were the only parties 
who knew she was not at maximum medical improvement, but they allowed the 
Division to believe otherwise and to act on that belief.

 

[¶18] "The purpose of § 
27-14-605(a) is to balance the concept of finality with the desire to see that a 
claimant receives no less and no more than that to which he is lawfully 
entitled." Jerding, 868 P.2d  at 249. To permit a claimant to modify her benefits 
based on a "mistake of material fact" which she either created or condoned would 
effectively negate the finality the statute was designed to protect. We hold the 
hearing examiner did not err in finding that the procedural misunderstanding 
regarding the availability of Smith's future benefits was insufficient to 
support a modification of her benefits under Wyo. Stat. § 
27-14-605(a).

 

                                          
V. CONCLUSION

 

[¶19] The legislature's 1986 
application of an administrative process to worker's compensation claims does 
not provide a basis for departure from our previous interpretation that 
"mistake," pursuant to Wyo. Stat. § 27-14-605(a), requires a showing of a 
material mistake of fact made by the fact finder. Since Smith failed to make 
such showing, the order denying benefits is affirmed.

 

 THOMAS, Justice, concurring 
specially.

 

[¶20] I am in accord with 
the result reached in the opinion of the Court, and I have no fault to find with 
the rationale espoused. What seems painfully obvious to me, however, is that 
there never was any mistake of fact involved in this case. When the doctor 
testified that he was under the assumption that his maximum medical improvement 
certification would have no effect on Smith's right to future temporary 
disability benefits, the doctor was not articulating any mistake as to the 
facts, he was explaining that he was mistaken about the legal effect of his 
certification. His mistake was one of law, not of fact, and serves as a graphic 
reminder of the hazards that are encountered when one assumes to act outside the 
scope of professional competence.

 

 

FOOTNOTES

1 The 
last paragraph of the letter stated:

 You will 
continue to receive medical treatment for problems related solely to the 
original injury and the acceptance of the award does not prevent future claims 
of additional disability resulting from the original injury as specified under 
W.S. § 27-14-605.

  

2 Wyo. 
Stat. § 27-14-605(a) provides:

 If a 
determination is made in favor of or on behalf of an employee for any benefits 
under this act, an application may be made to the division by any party within 
four (4) years from the date of the last payment for additional benefits or for 
a modification of the amount of benefits on the ground of increase or decrease 
of incapacity due solely to the injury, or upon grounds of mistake or 
fraud.  The division may, upon the 
same grounds and within the same time period, apply for modification of medical 
and disability benefits to a hearing examiner or the medical commission, as 
appropriate.