Title: State ex rel. Wyoming Workers' Compensation Div. v. Rivera

State: wyoming

Issuer: Wyoming Supreme Court

Document:

State ex rel. Wyoming Workers' Compensation Div. v. Rivera1990 WY 83796 P.2d 447Case Number: 90-18Decided: 08/21/1990Supreme Court of Wyoming
STATE OF WYOMING, EX REL. 
WYOMING WORKERS' COMPENSATION DIVISION, 

APPELLANT 
(OBJECTOR-DEFENDANT),

v.

GERALD G. RIVERA, 

APPELLEE 
(EMPLOYEE-CLAIMANT).

Appeal from the District 
Court, Laramie County, Nicholas G. Kalokathis, J.

Joseph B. Meyer, 
Atty. Gen., and Larry M. Donovan, Sr. Asst. Atty. Gen., for 
appellant.

George Santini 
of Graves, Santini & Villemez, P.C., Cheyenne, for 
appellee.

Before 
THOMAS, CARDINE, MACY and GOLDEN, JJ.; and ROONEY, J. (RET.).

MACY, Justice.

[¶1]      Appellant State 
of Wyoming, ex rel. Wyoming Workers' Compensation Division, appeals the district 
court's decision affirming the grant of benefits to the grandchildren of an 
employee who received worker's compensation benefits for a permanent total 
disability.

[¶2]      We 
affirm.

[¶3]      The Workers' 
Compensation Division raises the following issues for our review:

     I. Whether or not the 
administrative hearing officer had statutory authority to hear this 
case.

     II. Whether dependent 
child benefits are an "award" for which timely application must be 
made.

     III. Whether an award 
of dependent child benefits is barred because of failure to timely file for said 
benefits.

     IV. Whether the 
administrative hearing officer erred by allowing the surprise hearsay testimony 
of a deputy county clerk to be used to estop the operation of the statute of 
limitations.

     V. Whether the 
administrative hearing officer erred by allowing the introduction of parol[] 
evidence to alter or amend a prior court decree.

[¶4]      Appellee Gerald 
G. Rivera was awarded benefits on August 13, 1981, under the permanent total 
disability section of the Wyoming Worker's Compensation Act (the Act).1 Rivera's wife subsequently went to 
the clerk of court's office and inquired as to whether her grandson and 
granddaughter, who had been living with her and Rivera since their mother's 
death, were eligible for benefits as Rivera's dependents. The deputy clerk 
contacted the Workers' Compensation Division, and an employee of the Workers' 
Compensation Division informed the deputy clerk that the grandchildren were not 
eligible for dependent child benefits because they were not Rivera's children. 
Neither Rivera nor his wife filed a claim for their grandchildren until 
1989.

[¶5]      Rivera and his 
wife adopted their granddaughter in 1988 and filed a claim for dependent child 
benefits on June 9, 1989. The Workers' Compensation Division objected, claiming 
that the granddaughter did not meet the Act's definition of a child. The matter 
was referred to the office of independent hearing officers,2 and the office established a 
hearing date.

[¶6]      At the hearing, 
the hearing officer addressed the issue of whether both grandchildren were 
entitled to dependent child benefits under the Act. The parties stipulated that 
the grandchildren met the Act's definition of children if they were 
substantially dependent upon Rivera. The Workers' Compensation Division 
contended that the grandchildren were not substantially dependent upon Rivera 
and that their claim for benefits was barred by the statute of limitations 
contained in the Act.

[¶7]      The hearing 
officer concluded that the grandchildren were entitled to benefits as dependents 
of an injured employee. In his findings of fact, the hearing officer found that 
the grandchildren had been substantially dependent upon Rivera and his wife from 
the time of Rivera's injury to the time of the application for dependent child 
benefits with the exception of a one-year period. He also found that Rivera's 
wife had made inquiries about the eligibility of their grandchildren for 
dependent child benefits after Rivera received an award for a permanent total 
disability; that the Workers' Compensation Division informed the deputy clerk of 
court that the grandchildren were not eligible for benefits as they were not the 
natural or adopted children of Rivera at the time of the injury; and that Rivera 
relied upon the Workers' Compensation Division's erroneous information and did 
not file for benefits on behalf of the grandchildren. The hearing officer 
concluded that he had jurisdiction to award benefits to Rivera's grandchildren; 
that they were entitled to benefits; that the Act did not contain a statute of 
limitations which prevented them from receiving benefits; and that, even if the 
Act did contain an applicable statute of limitations, the Workers' Compensation 
Division was estopped from denying the grandchildren's benefits because it gave 
erroneous information to the deputy clerk. Finally, the hearing officer ordered 
the Workers' Compensation Division to pay benefits to Rivera's grandchildren for 
the period of time between Rivera's permanent total disability award and the 
date the grandchildren reach the age of majority, excluding one year.3 The Workers' Compensation Division 
appealed the hearing officer's decision to the district court, and the district 
court affirmed the grant of benefits. This appeal followed.

[¶8]      Our review of a 
decision by the office of independent hearing officers is controlled by the 
Wyoming Administrative Procedure Act. Wyo. Stat. § 27-14-602(b) (1977).4 Wyo. Stat. § 16-3-114(c) (1977) of 
that act provides:

     To the extent 
necessary to make a decision and when presented, the reviewing court shall 
decide all relevant questions of law, interpret constitutional and statutory 
provisions, and determine the meaning or applicability of the terms of an agency 
action. In making the following determinations, the court shall review the whole 
record or those parts of it cited by a party and due account shall be taken of 
the rule of prejudicial error. 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. [Laws 1982, ch. 62, § 3]

[¶9]      The Workers' 
Compensation Division contends that the hearing officer did not have authority 
to decide this case since the legislature did not create the office of 
independent hearing officers until after Rivera's injury had occurred.5 The 1986 version of Wyo. Stat. § 
27-14-602 (1977) stated in pertinent part:

     (a) For the purposes 
of [the Worker's Compensation Act], the office of independent hearing officers 
is created. * * * An independent hearing officer shall conduct contested cases 
under this act in accordance with this section. * * *

     (b) If either the 
division or the employer object to the right of the employee to receive 
compensation, as to the amount of compensation or to amounts or procedures 
claimed for medical and health care, or at the request of the employee, the case 
shall be immediately referred to a hearing examiner who shall set the case for 
hearing at the earliest opportunity. The case shall be determined by a hearing 
examiner following the contested case procedures of the Wyoming Administrative 
Procedure Act. Appeals may be taken from the decision by any party to the 
contested case to the district court as provided by the Wyoming Administrative 
Procedure Act. Hearings may be held in any area of Wyoming giving consideration 
to the convenience of the employee, employer and division. [Laws 1986, Sp. 
Sess., ch. 3, § 3]

Chapter 5, 
section 1 of the 1987 Special Session Laws of Wyoming provides in relevant 
part:

Any worker's compensation 
claim filed with the clerk of court on or after July 1, 1987 and which is 
contested, shall be referred to a hearing examiner for disposition in accordance 
with W.S. 27-14-602 and the provisions of W.S. 27-14-101 through 27-14-804 shall 
apply to such claims in all respects.

We hold that 
Rivera's case was properly referred to and adjudicated by a hearing officer 
because the claim was filed after July 1, 1987.

[¶10]   The Workers' Compensation Division 
asserts that, due to a statute of limitations contained in the Act, Rivera's 
grandchildren are not entitled to receive dependent child benefits. Without 
deciding whether Rivera filed his claims in violation of a statute of 
limitations, we hold that the Workers' Compensation Division is estopped from 
denying payment of dependent child benefits to Rivera's grandchildren on the 
basis that Rivera failed to assert the claim in a timely manner. In Big Piney 
Oil & Gas Company v. Wyoming Oil and Gas Conservation Commission, 715 P.2d 557, 560 (Wyo. 1986), we stated:

     Equitable estoppel 
should not be invoked against a government or public agency functioning in its 
governmental capacity, except in rare and unusual circumstances and may not be 
invoked where it would serve to defeat the effective operation of a policy 
adopted to protect the public.

Our holding in 
Bauer v. State ex rel. Wyoming Worker's Compensation Division, 695 P.2d 1048 
(Wyo. 1985), delineates, however, a rare and unusual circumstance in which 
equitable estoppel operates against a public agency. In that case, the employer, 
the town of Saratoga, told the employee that she was not entitled to worker's 
compensation benefits since she was a part-time employee. On the basis of that 
information, the employee failed to file a claim for benefits in a timely 
manner.6 We held:

[T]he employer's 
misleading statements, although unintentional, were sufficient to constitute 
estoppel and prevent the employer and the state of Wyoming from invoking the 
statute of limitations as a defense.

Id. at 1053. The 
principle utilized in Bauer is applicable in this case. The record shows that 
the Workers' Compensation Division provided inaccurate information to Rivera's 
wife and that Rivera relied upon that information in failing to file a valid 
claim. Thus, the Workers' Compensation Division is estopped from invoking the 
statute of limitations as a defense.7 

[¶11]   The Workers' Compensation Division 
also argues that the hearing officer abused his discretion by allowing the 
testimony of the deputy clerk of court because such testimony was hearsay and 
because Rivera failed to disclose his intent to call the deputy clerk as a 
witness until the morning of the hearing. The deputy clerk testified, inter 
alia, that, in accordance with her normal course of business, she contacted 
one of the Workers' Compensation Division's claims supervisors to ask whether 
Rivera's grandchildren were eligible for dependent child benefits. She stated 
that the claims supervisor informed her that Rivera's grandchildren were not 
eligible for dependent child benefits.

[¶12]   We have defined an abuse of 
discretion as a decision which "`shocks the conscience of the court and appears 
so unfair and inequitable that a reasonable person could not abide it.'" Story 
v. Wyoming State Board of Medical Examiners, 721 P.2d 1013, 1018, 59 A.L.R.4th 
1089 (Wyo.), cert. denied 479 U.S. 962, 107 S. Ct. 459, 93 L. Ed. 2d 405 (1986) 
(quoting Waldrop v. Weaver, 702 P.2d 1291, 1293 (Wyo. 1985)). In addition, Wyo. 
Stat. § 16-3-108 (1977) addresses the issue of what evidence may be admissible 
in an administrative proceeding. That section provides in pertinent 
part:

     (a) In contested cases 
irrelevant, immaterial or unduly repetitious evidence shall be excluded and no 
sanction shall be imposed or order issued except upon consideration of the whole 
record or such portion thereof as may be cited by any party and unless supported 
by the type of evidence commonly relied upon by reasonably prudent men in the 
conduct of their serious affairs. Agencies shall give effect to the rules of 
privilege recognized by law. Subject to these requirements and agency rule if 
the interests of the parties will not be prejudiced substantially testimony may 
be received in written form subject to the right of cross-examination as 
provided in subsection (c) of this section. [Laws 1982, ch. 62, § 3]

Hearsay evidence 
is admissible in an administrative proceeding if it satisfies the requirements 
of § 16-3-108 and is probative, trustworthy, and credible. Story, 721 P.2d 1013.

[¶13]   The deputy clerk's testimony was 
not hearsay, however, because it was an admission by a party-opponent under 
W.R.E. 801(d)(2)(D). That rule states that a statement is not hearsay if it "is 
offered against a party and is * * * (D) a statement by his agent or servant 
concerning a matter within the scope of his agency or employment, made during 
the existence of the relationship." In addition, the Workers' Compensation 
Division has failed to demonstrate that the deputy clerk's testimony was 
irrelevant, immaterial, or unduly repetitious in violation of § 
16-3-108.

[¶14]   The hearing officer did not abuse 
his discretion by allowing the deputy clerk to testify despite the fact that the 
Workers' Compensation Division was not informed of Rivera's intent to call her 
as a witness until the morning of the hearing. We have previously dealt with the 
question of whether a court should allow the testimony of a witness who was not 
listed on the pretrial order. In Ford Motor Co. v. Kuhbacher, 518 P.2d 1255, 
1260 (Wyo. 1974), we stated:

The listing of the 
witnesses who would testify at a trial is not only permissible under Rule 16, 
W.R.C.P., but is desirable and should be encouraged. However, the requirements 
of adherence to such pretrial orders are within the discretion of the trial 
court, whose rulings will not be overturned except where there is an abuse of 
discretion. Courts should generally recognize the binding effect of all matters 
in the pretrial orders, but this does not mean that there should be rigid or 
pointless adherence to them in a trial but rather that avoidance of possible 
hardship to parties and the accomplishment of substantial justice to the merits 
of claims should be among the factors which the trial court 
considers.

See also 
Caldwell v. Yamaha Motor Co., Ltd., 648 P.2d 519 (Wyo. 1982). While Ford Motor 
Co. involved an appeal from a trial in a district court, we do not perceive any 
reason why the same general principle should not apply in this case. 

[¶15]   The deputy clerk's testimony was 
relevant to the merits of Rivera's case because it was the basis for his 
estoppel claim. According to Rivera's disclosure statement contained in the 
appendix of the Workers' Compensation Division's appellate brief, the Workers' 
Compensation Division was cognizant that Rivera would attempt to prove he had 
relied upon erroneous information provided by the Workers' Compensation Division 
via the deputy clerk. After the hearing officer decided to allow the deputy 
clerk's testimony, the Workers' Compensation Division had an opportunity to 
cross-examine the deputy clerk. It did not seek a continuance, and it did not 
call a rebuttal witness to refute or impeach the deputy clerk's testimony. Under 
these circumstances, the Workers' Compensation Division has failed to show that 
the hearing officer abused his discretion by allowing the deputy clerk to 
testify.

[¶16]   Finally, the Workers' Compensation 
Division contends that the hearing officer erred by allowing admission of 
evidence for the possibility of amending or altering the court decree which 
granted benefits to Rivera for his permanent total disability. The Workers' 
Compensation Division bases its argument on Rivera's Order of Award, which 
contains the following statement: "That there were dependent upon said Employee 
at the time of the accident * * * Wife Virginia, and Son Christopher." The 
Workers' Compensation Division asserts that evidence of additional dependents is 
inadmissible parol evidence.

[¶17]   Since the parol evidence rule does 
not apply to judicial decrees, the Workers' Compensation Division's reliance 
upon the rule is meritless. See Cordova v. Gosar, 719 P.2d 625 (Wyo. 1986). 
Further, the Order of Award issued in 1981 does not have a preclusive effect, 
under the doctrines of res judicata and collateral estoppel, upon Rivera's claim 
for dependent child benefits as the 1981 order did not address the issue of 
whether Rivera's grandchildren were entitled to those benefits. See Delgue v. 
Curutchet, 677 P.2d 208 (Wyo. 1984). The hearing officer did not abuse his 
discretion when he allowed admission of evidence demonstrating that Rivera's 
grandchildren were also Rivera's dependents.

[¶18]   Affirmed.

ROONEY, Justice, Retired, 
dissenting.

[¶19]  My dissent in this case is for the 
reasons stated in my dissent in State of Wyoming ex rel. Wyoming Workers' 
Compensation Division v. Halstead, 795 P.2d 760 (1990).

[¶20]  Jurisdiction of the hearing examiner was 
here contested. As I stated in Halstead, the hearing examiner does not have 
authority to act as an independent judicial officer. An effort to give him such 
authority would be unconstitutional under the separation of powers 
doctrine.

FOOTNOTES

1 Chapter 12 of Title 27 
(Worker's Compensation, Wyo. Stat. §§ 27-12-101 to -805 (1977)) was repealed in 
1986 and recreated as current Chapter 14 (Wyo. Stat. §§ 27-14-101 to -804 
(1977)) effective July 1, 1987.

2 The office of 
independent hearing officers was created during the 1986 special session of the 
Wyoming Legislature. Effective July 1, 1989, the office of independent hearing 
officers was changed to the office of independent hearing examiners. Wyo. Stat. 
§ 27-14-602 (1977).

3 "An employee's claim is 
governed by the laws in effect at the time of injury." Shapiro v. State ex rel. 
Worker's Compensation Division, 703 P.2d 1079, 1081-82 (Wyo. 1985). See also 
Seckman v. Wyo-Ben, Inc., 783 P.2d 161 (Wyo. 1989). At the time of Rivera's 
injury, the amount of compensation available for dependents was $60 per month. 
Wyo. Stat. § 27-12-405(c) (1977).

4 Amended effective July 
1, 1989.

5 See supra note 
2.

6 Wyo. Stat. § 
27-12-503(a) (1977) provided:

(a) No order or award for 
compensation involving an injury which is the result of a single brief 
occurrence rather than occurring over a substantial period of time, shall be 
made unless in addition to the reports of the injury, an application or claim 
for award is filed with the clerk of court in the county in which the injury 
occurred, within one (1) year after the day on which the injury occurred or for 
injuries not readily apparent, within one (1) year after discovery of the injury 
by the employee. The reports of an accident do not constitute a claim for 
compensation. [Repealed 1986]

7 We recognize that the 
current version of the Act contains a tolling provision for mistake and fraud 
and that one of the bases for the Bauer decision was the lack of such a 
provision. Wyo. Stat. § 27-14-605 (1977). At the time of Rivera's injury, the 
Act did not contain a tolling provision for mistake or fraud. Therefore, 
regardless of whether the Act has or had a statute of limitations which applies 
to Rivera's claim, the equitable estoppel analysis used in Bauer is controlling. 
Seckman, 783 P.2d 161; Shapiro, 703 P.2d 1079 (holding that the laws in effect 
at the time of an employee's injury govern his worker's compensation 
claims).