Title: IN THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF: KIRK JACOBS v. STATE OF WYOMING, ex rel. WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION

State: wyoming

Issuer: Wyoming Supreme Court

Document:

IN THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF: KIRK JACOBS v. STATE OF WYOMING, ex rel. WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION 2009 WY 118216 P.3d 1128Case Number: NO. S-08-0255Decided: 09/25/2009
APRIL 
TERM, A.D. 2009

 
 
IN 
THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF:KIRK 
JACOBS,Appellant(Claimant),v.STATE OF WYOMING, ex 
rel., WYOMING WORKERS' SAFETY AND COMPENSATION 
DIVISION,Appellee(Respondent).

 
 
Appeal 
from the District Court of Albany County

The 
Honorable Jeffrey A. Donnell, Judge

 
 

Representing 
Appellant:

Bill 
G. Hibbler of Bill G. Hibbler, P.C., Cheyenne, Wyoming.

 
 

Representing 
Appellee:

Bruce 
A. Salzburg, Wyoming Attorney General; John W. Renneisen, Deputy Attorney 
General; James Michael Causey, Senior Assistant Attorney 
General.

 
 
Before 
VOIGT, C.J., and GOLDEN, HILL, KITE, and BURKE, 
JJ.

 
 
VOIGT, 
Chief Justice.

 
 
[¶1]      Kirk Jacobs (the 
appellant) injured his toe in a work-related accident in 1982.  He received workers' compensation 
benefits for a number of conditions related to this accident for many years, 
including payments for treatment of chronic abdominal pain.  In 2003, the Wyoming Workers' Safety and 
Compensation Division (Division) entered a Final Determination denying further 
benefits for chronic abdominal pain.  
The appellant challenged that action and the Office of Administrative 
Hearings (OAH) determined that the appellant's claim was barred by the doctrine 
of collateral estoppel.  Finding 
that the OAH erred in applying the doctrine of collateral estoppel, we reverse 
and remand.

 
 
ISSUES

 
 
[¶2]     1.     Did the OAH properly 
conclude that the appellant's claim for benefits relating to chronic abdominal 
pain was barred under the doctrine of collateral estoppel?

 
 
           
2.     Did the 
OAH lack jurisdiction to decide the compensability of the appellant's claim 
because compensability was not challenged pursuant to Wyo. Stat. Ann. § 
27-14-605 (LexisNexis 2009)?

 
 
FACTS

 
 
[¶3]      This matter began 
in 1982, when the appellant sustained a work-related toe injury.  This appeal is the fourth time the 
appellant has been before this Court since the original injury.  See State ex rel. Wyo. Workers' Comp. Div. 
v. Jacobs, 924 P.2d 982 (Wyo. 1996) (Jacobs I); Jacobs v. State ex rel. Wyo. Workers' Safety 
& Comp. Div., 2004 WY 136, 100 P.3d 848 (Wyo. 2004) (Jacobs II); Jacobs v. State ex rel. Wyo. Med. 
Comm'n, 2005 WY 104, 118 P.3d 441 (Wyo. 2005) (Jacobs III).  In the present appeal, the appellant 
challenges the denial of benefits for chronic abdominal pain, which pain he 
insists was related to the original toe injury.  The OAH determined that the question of 
whether the abdominal pain was related to the toe injury had already been 
conclusively decided, and thus the appellant's claim was barred by res judicata and collateral 
estoppel.  To properly review this 
decision, we must briefly examine the history of the appellant's claims to 
determine whether that issue has been decided.

 
 
[¶4]      In Jacobs I, the OAH awarded the appellant 
non-professional home health care benefits.  That award was reversed on appeal.  Jacobs I, 924 P.2d  at 984.  While the compensability of the 
appellant's chronic abdominal pain was not presented to, or decided by, the OAH, 
our opinion recognized that the appellant was suffering from such symptoms.  We said:

 
 
In 
September of 1982, Jacobs suffered a work-related injury to his right little 
toe.  In February of 1983, Jacobs 
experienced an allergic reaction to an antibiotic used to treat an infection 
which had developed in his right foot.  
The reaction manifested itself as colitis and nerve damage which left 
Jacobs with severe chronic pain and intermittent inability to accomplish the 
activities of daily life without assistance.

 
 

Id. 
at 
983.  

 
 
[¶5]      Jacobs II began in 2001, when the 
appellant sought benefits for lung and knee problems, claiming they were related 
to his original injury.  Jacobs II, 2004 WY 136, ¶ 4, 100 P.3d  at 
849.  The Division denied benefits 
and referred the matter to the Wyoming Medical Commission ("Commission") for a 
hearing.  Id.  In his opening statement, the 
appellant's attorney set forth the issues to be presented in the hearing as 
follows:

 
 
These 
claims, at least to the best of our knowledge, involve two separate medical 
issues.  The first of these issues 
concerns [the appellant's] entitlement to supplemental oxygen and related 
medical costs to this treatment.

 
 
. 
. . . 

 
 
The 
second issue, in essence, that needs to be decided here concerns the arthritic 
and actual bone-on-bone condition of [the appellant's] knees.  

 
 
Although 
the knee and lung claims were the only two issues before the Commission, the 
question of whether the appellant's chronic abdominal pain was related to the 
original injury was raised at this hearing and discussed in the Commission's 
findings of fact and conclusions of law in connection with the Commission's 
consideration of the compensability of the knee and lung 
claims.

 
 
In 
this case [the appellant] contends that as a result of this injury he developed 
an infection in his toe which was treated with Keflex and the Keflex caused 
abdominal pain which has required his continued use of narcotic pain 
medication.  As a result of his need 
for large amounts of narcotic pain medication, he has developed breathing and 
pulmonary problems requiring treatment.  
Obviously critical to this inquiry is whether the abdominal pain and 
consequent need for medication is related to the work injury.  [The appellant] contends the issue of 
causation of abdominal pain has been previously determined and cannot be 
relitigated.  Initially, [the 
appellant] has not submitted anything to show there has been a judicial or 
administrative determination of causation. . . .

 
 
. 
. . .

 
 
[The 
appellant] has not met his burden of proof that his abdominal pain is related to 
his work injury.  A review of the 
record clearly shows that no health care provider to date has been able to 
determine the cause of his abdominal pain.  
At best there is only speculation and conjecture as to causation.  There is no objective evidence of 
colitis and even if antibiotic-induced colitis existed in the early 1980's, a 
brief bout of such colitis has not been shown to relate to chronic abdominal 
pain. Clearly the claimed abdominal pain is something of long standing 
duration.  If such were related to 
claimed colitis such would have resolved long ago and no evidence to the 
contrary has been shown. . . .

 
 
(Footnote 
omitted).  Although the Commission 
discussed the chronic abdominal pain, it made no specific findings regarding the 
compensability of such claims.  
Instead, the Commission's findings of fact and conclusions of law simply 
stated:

 
 
Following 
a careful review of all the evidence presented in the case, the Medical 
Commission finds that [the appellant] has not met his burden of proving that his 
treatment for breathing and pulmonary problems are related to his September 24, 
1982, work injury.  He has also not 
met his burden of proof that arthritis in his knees is related to the work 
injury.  Therefore he is not 
entitled to medical payment for the benefits in question.  

 
 
[¶6]      On appeal, the 
appellant did "not object to the denial of benefits for his knee and lung 
claims, but rather [took] exception to the Commission's finding regarding the 
causal connection between the 1982 toe injury and subsequent abdominal pain. . . 
."  Jacobs II, 2004 WY 136, ¶ 1, 100 P.3d  at 
849.  We affirmed the denial of 
benefits for the lung and knee claims, and with regard to the appellant's 
chronic abdominal pain, we found:

 
 
Benefits 
for [the appellant's] chronic abdominal pain have not been denied and no 
decision determining that issue has been formalized.  Until a final determination is made by 
the appropriate administrative agency, the issue is not fit for our review.  This Court cannot reverse or affirm a 
denial of benefits that has not occurred.

 
 

Id. 
at 
¶ 8, at 851.

 
 
[¶7]      While Jacobs II was pending before this Court, 
several events occurred at the administrative level that led to the appellant's 
third appeal.  In March of 2003, the 
Division issued a Final Determination denying the appellant benefits for chronic 
abdominal pain.1  The Commission held a contested case 
hearing on October 28, 2003, to determine the relatedness of the chronic 
abdominal pain to the original injury.  Before the Commission could issue a 
decision on the merits, both the Division and the appellant filed competing 
motions requesting summary decision of the matter on grounds of res judicata and collateral estoppel.2  After considering both motions, the 
Commission issued an Order Granting Division's Motion for Summary Decision on 
January 22, 2004.  In its order, the 
Commission sustained the Division's denial of benefits for the appellant's 
chronic abdominal pain concluding that the claim was barred by the doctrine of 
collateral estoppel.

 
 
[¶8]      After the 
district court affirmed the Commission's determination, the matter was again 
before this Court in Jacobs III.  We reversed and remanded, finding that 
this was not a "medically contested case" and thus the Commission did not have 
subject matter jurisdiction to decide the claim.  Jacobs III, 2005 WY 104, ¶ 10, 118 P.3d  
at 444-45.  Although our decision 
was confined to the question of the Commission's jurisdiction, we noted the 
unsettled nature of the appellant's case, stating:

 
 
Most 
significantly, we have not decided whether [the appellant's] chronic abdominal 
pain was caused by his 1982 work injury.  
Neither have we decided whether that particular question has been 
previously litigated and decided.  
Thus, we have also not decided whether collateral estoppel or res judicata should be applied to bar 
his current claim.

 
 

Id. 
at 
¶ 11, at 445. 

[¶9]      On December 23, 
2005, following a remand from this Court, the Commission entered an order 
remanding the case to the Division, for ultimate referral to the OAH.  The OAH issued an order setting the 
matter for a contested case hearing.  No hearing was held; instead, the parties 
agreed that the matter be decided based on the evidence contained in the appeal 
file.  The OAH issued an order on 
June 28, 2007, sustaining the denial of the appellant's claim for benefits 
related to his chronic abdominal pain under the doctrines of res judicata and collateral estoppel. 
 Specifically, the OAH decided that 
the compensability of the appellant's claim for chronic abdominal pain had 
already been decided at the January 28, 2003 hearing and resulting order.  The district court affirmed this decision 
and the appellant filed a timely appeal therefrom. 

 
 
STANDARD 
OF REVIEW

 
 
[¶10]   When considering an appeal from a 
district court's review of an administrative agency's action, we give "no 
special deference to the district court's decision," but instead review the case 
as if it had come directly from the administrative agency.  Dale v. S & S Builders, LLC, 2008 WY 
84, ¶ 8, 188 P.3d 554, 557 (Wyo. 2008).  Our review of an administrative agency's 
action is governed by the Wyoming Administrative Procedure Act, which provides 
in pertinent part that the reviewing court shall:

 
 
(i)       Compel 
agency action unlawfully withheld or unreasonably delayed; 
and

(ii)      Hold unlawful and 
set aside agency action, findings and conclusions found to 
be:

(A)     Arbitrary, capricious, 
an abuse of discretion or otherwise not in accordance with 
law;

(B)     Contrary to 
constitutional right, power, privilege or immunity;

(C)    In excess of statutory 
jurisdiction, authority or limitations or lacking statutory 
right;

(D)    Without observance of 
procedure required by law; or

(E)     Unsupported by 
substantial evidence in a case reviewed on the record of an agency hearing 
provided by statute.

 
 
Wyo. 
Stat. Ann. § 16-3-114(c) (LexisNexis 2009).  

 
 
[¶11]   This appeal involves only questions 
of law.  "Absent evidentiary 
dispute, the standard of review for contested case hearings is simply stated as 
whether an agency's conclusions are in accordance with the law."  Parodi v. Wyo. Dep't of Transp., 947 P.2d 1294, 1295 (Wyo. 1997).  
Questions of law are reviewed de 
novo, and "[c]onclusions of law made by an administrative agency are affirmed only if they are in accord with the 
law.  We do not afford any deference 
to the agency's determination, and we will correct any error made by the 
agency in either interpreting or applying the law."  State ex rel. Workers' Safety & 
Comp. Div. v. Garl, 2001 WY 
59, ¶ 9, 26 P.3d 1029, 1032 (Wyo. 2001) (citations 
omitted).

 
 
DISCUSSION

 
 

1.     Did the OAH properly conclude that the 
appellant's claim for benefits relating to chronic abdominal pain was barred 
under the doctrine of collateral estoppel?

 
 
[¶12]   
The doctrines of collateral estoppel and res judicata apply in the administrative 
context.  Slavens v. Bd. of County Comm'rs for Uinta 
County, 854 P.2d 683, 685-86 (Wyo. 1993).  We have explained that although the 
doctrines are often used interchangeably, collateral estoppel is more often 
appropriately used in an administrative setting.

 
 
In 
Salt Creek Freightways, 
we noted that although many cases speak of res judicata 
in the administrative context, they actually apply collateral 
estoppel.  Salt Creek Freightways 
[v. Wyo. Fair Employment 
Practices Comm'n], 598 P.2d [435,] 437 [(Wyo. 1979)]. Collateral 
estoppel is the appropriate doctrine since collateral estoppel bars relitigation 
of previously litigated issues.  Salt Creek Freightways, 598 P.2d at 
438 (quoting Roush v. Roush, 589 P.2d 841, 843 (Wyo. 
1979) (per curiam)).  See also Bresnahan v. May Dept. Stores 
Co., 726 S.W.2d 327, 
329 (Mo. 1987) (when a fact is properly determined in one legal proceeding, 
it is given effect in another lawsuit).  Res judicata on the other hand bars 
relitigation of previously litigated claims or causes ofaction.  Salt Creek Freightways, 598 P.2d  at 437.  See also Batson v.  
Shiflett, 602 A.2d [1191,] 
1201 [(Md. 1992)] (quoting Parklane Hosiery Co., Inc. v. Shore, 439 U.S. 322, 99 S. Ct. 645, 
58 L. Ed. 2d 552 (1979)).  Since 
administrative decisions deal primarily with issues rather than causes of action 
or claims, collateral estoppel is the appropriate doctrine.  Salt Creek 
Freightways, 598 P.2d  
at 437.

 
 

Slavens, 
854 P.2d  at 685-86 (emphasis in original).  
With regard to collateral estoppel, we consider four factors in 
determining whether the doctrine applies:

 
 

(1) 
whether the issue decided in the prior adjudication was identical with 
the issue presented in the present action; (2) whether the prior adjudication 
resulted in a judgment on the merits; (3) whether the party against whom 
collateral estoppel is asserted was a party or in privity with a party to the 
prior adjudication; and (4) whether the party against whom collateral estoppel 
is asserted had a full and fair opportunity to litigate the issue in the prior 
proceeding.

 
 

Wilkinson 
v. State ex rel. Wyo. Workers' Safety & Comp. Div., 
991 P.2d 1228, 1234 (Wyo. 1999) (emphasis in original) (quoting 
Slavens, 854 
P.2d at 686).

 
 
[¶13]   While we question whether the first 
and fourth elements of collateral estoppel are satisfied in this case, it is 
clear that no prior adjudication has resulted in a judgment on the merits, thus 
the OAH should not have decided the matter on collateral estoppel.  In addressing that element, the OAH 
stated:

 
 
Second, 
the January 28, 2003, contested case hearing resulted in the Medical 
Commission's February 22, 2003, Findings of Fact, Conclusions of Law and Order 
of Medical Commission Hearing Panel.  
The Medical Commission's February 22, 2003, Order is clearly adjudication 
on the merits.  The finality of the 
Medical Commission's February 22, 2003, Order cannot be contested as the Order 
has already been upheld by the Wyoming Supreme Court.

 
 
This 
finding is simply incorrect.  To 
begin, although the February 22, 2003 Order discusses the chronic abdominal pain 
condition as it related to the appellant's lung and knee problems, the Order 
makes no specific finding addressing the past, present, or future compensability 
of any claim by appellant for benefits related to his chronic abdominal 
pain.  Furthermore, the Division's 
actions following the entry of that Order are inconsistent with the OAH's 
conclusion that the question of the appellant's chronic abdominal pain was 
decided in the February 22, 2003 Order.  
Approximately one month after the February 22, 2003 Order was entered, 
the Division issued a Final Determination specifically denying benefits related 
to the appellant's chronic abdominal pain and a second contested case hearing 
was held addressing that denial.  At 
that contested case hearing, the question of the compensability of the 
appellant's chronic abdominal pain was properly presented and directly at issue; 
however, the Commission did not rule on that question, but instead decided the 
case on grounds of collateral estoppel.3  A Final Determination denying benefits 
for chronic abdominal pain and contested case hearing on the merits would have 
not been necessary if that issue had been determined in the February 22, 2003 
Order.  

 
 
[¶14]   Finally, the OAH's finding that the 
compensability of the chronic abdominal pain was decided when this Court 
affirmed the February 22, 2003 Order in Jacobs II mischaracterizes the nature of 
that decision.  While we sustained 
the denial of benefits for the knee and lung claims, we specifically found that 
"benefits for [the appellant's] chronic abdominal pain have not been denied and 
no decision determining that issue has been formalized" and "[t]his Court cannot 
reverse or affirm a denial of benefits that has not occurred."  Jacobs II, 2004 WY 136, ¶ 8, 100 P.3d  
at 851.   

 
 
[¶15]   Our holding that no final 
determination was ever entered allowing for application of collateral estoppel 
is equally applicable to the appellant.  
In the proceedings below and in this appeal, the appellant asserted that 
under the doctrine of collateral estoppel the Division is precluded from denying 
his claims for benefits.  His 
argument is essentially based on the fact that the Division previously paid for 
the pain medication to treat his abdominal pain and recognized the existence of 
the condition in Jacobs I.  We have said that a claimant is not 
guaranteed future benefits on the basis of a prior award.  Snyder v. State ex rel. Wyo. Workers' 
Comp. Div., 957 P.2d 289, 293 (Wyo. 1998).  Furthermore, we find that the statement 
from Jacobs I falls far short of 
satisfying the requirements necessary to sustain an assertion of collateral 
estoppel.  Although we mentioned the 
appellant's abdominal pain in Jacobs 
I, the compensability of that condition was not at issue and, as we have 
already discussed, the record on appeal contains no order or final decision on 
the merits of that claim that would preclude the Division from later challenging 
the compensability of the appellant's chronic abdominal pain. 

 
 
2.       Did the OAH 
lack jurisdiction to decide the compensability of the appellant's claim because 
compensability was not challenged pursuant to Wyo. Stat. Ann. § 27-14-605 
(LexisNexis 2009)?

 
 
[¶16]   The appellant asserts that the 
Division lacked jurisdiction to consider the termination of benefits for his 
abdominal pain because the Final Determination was improper.  Specifically, the appellant asserts that 
the availability of benefits should have been determined under Wyo. Stat. Ann. § 
27-14-605 (LexisNexis 2009), which statute governs modification of benefits 
previously awarded.4  The appellant's attempt to apply this 
statute to his claim is misplaced inasmuch as the Division was not attempting to 
modify benefits previously awarded.  
The Division's Final Determination denying benefits for chronic abdominal 
pain was not an effort to modify benefits relating to the original toe injury, 
or retract or modify the previously-uncontested benefits paid in relation to the 
chronic abdominal pain.  Instead, 
the Final Determination dealt with a new claim and was a separate administrative 
determination.  Thus, Wyo. Stat. 
Ann. § 27-14-605 did not apply.  McIntosh v. State ex rel. Wyo.  Med. Comm'n, 2007 WY 108, ¶ 26, 162 P.3d 483, 491 (Wyo. 2007) ("the Division did not contest the 
compensability of [claimant's] original claim or seek to retract any payments 
already made to him.  Rather, the 
Division challenged his right to payment of future benefits  Therefore, § 27-14-605 is not 
applicable"); see also Spletzer v. State ex rel. Wyo. Workers' 
Safety & Comp. Div., 2005 WY 90, ¶¶ 13-14, 116 P.3d 1103, 1110 (Wyo. 
2005); Martinez v. State ex rel. 
Wyo. Workers' Comp. Div., 917 P.2d 619, 
622 (Wyo. 1996).

 
 
CONCLUSION

 
 
[¶17]   After carefully reviewing the 
record on appeal, we are unable say that a final decision was ever entered 
determining that the appellant's chronic abdominal pain was, or was not, 
causally related to his original compensable injury.  Thus, the OAH's conclusion that the 
appellant was estopped from raising a claim for benefits was not in accord with 
the law.  Similarly, we find that 
collateral estoppel does not preclude the Division from determining the 
compensability of benefits for the chronic abdominal pain.  Finally, because the Division is not 
modifying an award of benefits, its denial of benefits is not subject to the 
requirements of Wyo. Stat. Ann. § 27-14-605.  We reverse the district court's 
affirmance of the OAH's order and remand for proceedings consistent with this 
opinion.

 
 
FOOTNOTES

 
 

1The 
language of the Division's Final Determination is actually quite vague, stating: 
"Current treatment is not related to the original work injury to the right foot 
of 9-24-82."  While this statement 
is not clear as to what benefits the Division was denying, the record indicates 
that the Division's intent was to deny further benefits for treatment of the 
appellant's chronic abdominal pain.

 
 

2The 
unusual procedural course taken here (i.e. filing dispositive motions after a 
hearing on the merits) appears to have been precipitated by a post-hearing 
request by the Commission for additional information.  The Division objected to the request, 
arguing that the matter should be decided in its favor based on principles of 
collateral estoppel and res 
judicata.  Following these 
motions, the Commission entered an order staying the request for additional 
evidence and allowing the parties to file dispositive 
motions.

 
 

3We 
note that Jacobs III and the present 
appeal would have been obviated by a decision on the merits at that point.  We also note that based on our review of 
the record, the evidence and arguments presented at that hearing were likely 
sufficient to allow a deciding body to reach a conclusion on the question of 
whether the chronic abdominal pain is causally related to the original toe 
injury.

 
 

4Wyo. 
Stat. Ann. § 27-14-605, entitled "Application for modification of benefits; time 
limitation; grounds; termination of case; exceptions" reads: 

 
 
(a)   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.

(b)   Any right to benefits shall be 
terminated and is no longer under the jurisdiction of this act if a claim for 
any benefit is not filed with the division within the four (4) year limitation 
prescribed under subsection (a) of this section.

(c)   A claim for medical benefits which 
would otherwise be terminated under subsection (b) of this section and barred 
under W.S. 27-14-503(a) and (b) may be paid by the division if the 
claimant:

(i)      Submits medical 
reports to the division substantiating his claim;

(ii)     Proves by competent 
medical authority and to a reasonable degree of medical certainty that the 
condition is directly related to the original injury; and 

(iii)    Submits to an examination by 
a health care provider selected by the division and results of the examination 
validate his claim.