Title: IN THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF: STATE OF WYOMING, ex rel., WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION V. ROBERT C. MADELEY

State: wyoming

Issuer: Wyoming Supreme Court

Document:

IN THE MATTER OF THE WORKER'S COMPENSATION CLAIM OF: STATE OF WYOMING, ex rel., WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION V. ROBERT C. MADELEY2006 WY 63134 P.3d 281Case Number: 05-167Decided: 05/19/2006
APRIL 
TERM, A.D. 2006

 
 
IN THE 
MATTER OF THE WORKER'S COMPENSATION CLAIM OF:

 
 
STATE OF 
WYOMING, ex rel., WYOMING WORKERS' SAFETY 
AND COMPENSATION DIVISION,

 
 
Appellant

(Objector/Defendant/Respondent),

 
 
v.

 
 
ROBERT 
C. MADELEY,

 
 
Appellee

(Employee/Claimant/ 
Petitioner).

 
 
Appeal 
from the DistrictCourtofTetonCounty

 
 

Representing 
Appellant:

Patrick 
J. Crank, Wyoming Attorney General; John W. Renneisen, Deputy Attorney General; 
Steven R. Czoschke, Senior Assistant Attorney General; Kristi M. Radosevich, 
Assistant Attorney General

 
 

Representing 
Appellee:

Christopher 
S. Leigh, Jackson, 
Wyoming

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

 
 
GOLDEN, 
J., delivers the opinion of the Court; HILL, C.J., files a dissenting 
opinion

 
 

GOLDEN, 
Justice.

 
 
[¶1]      Robert Madeley 
(Madeley) suffered a compensable injury and was awarded temporary total 
disability benefits.  After 
receiving a permanent partial impairment award, Madeley applied for permanent 
partial disability benefits based on loss of earning capacity.  The Wyoming Workers' Compensation 
Division (Division) denied benefits.  
After a contested case hearing, the denial of benefits was upheld.  The district court, reviewing the case 
on the merits, reversed the hearing officer's decision and awarded 
benefits.  The Division now appeals 
to this Court.  We find that the 
Order denying benefits is facially insufficient to permit appellate review.  We therefore reverse the district 
court's decision and remand with directions to vacate the Order denying 
benefits.  The district court is 
directed to remand the case for supplemental findings of fact and conclusions of 
law or other proceeding consistent with this opinion. 

 
 

ISSUES

 
 
[¶2]      The Division 
presents two issues for our review:

 
 
I.  Whether the hearing examiner's decision 
that Madeley failed to prove he is entitled to permanent partial disability 
benefits was arbitrary or capricious[.]

 
 
II.   Whether the hearing examiner's 
decision that Madeley's loss of earning capacity is attributable to a non-work 
related cardiac condition, and also due to economic factors, is in accordance 
with law[.]

 
 

FACTS

 
 
[¶3]      On November 10, 
1999,1 Madeley suffered a work-related 
injury to his back, arms and hands while employed as a carpenter through Jackson 
Temporary Services. In December 1999, Madeley underwent surgery for bilateral 
carpal tunnel release.  He was 
released to full, unrestricted employment on June 7, 2000.2 

 
 
[¶4]      In July 2000, 
Madeley reported to his treating physician that he was dropping objects.  A functional capacity evaluation 
completed in September 2000 concluded that Madeley was capable of performing 
only light duty work.  On February 
2, 2001, Madeley was assessed with a 3% whole person permanent impairment and 
restricted from repetitive working above shoulder level, repetitive strong 
grasping, repetitive lifting over 25 pounds and lifting greater than 50 
pounds.  Madeley disputed the 3% 
impairment rating and a second evaluation was conducted, which resulted in 4% 
whole person impairment.  In 
September 2001, Madeley received the 4% impairment benefit award.   At some later time, Madeley 
submitted to the Division an Employment Plan which he had completed for the Utah 
Department of Workforce Services.  
The document indicated that he had recently worked as a flagger, but was 
no longer able to do flagging activities because of a heart attack he suffered 
in September 2001. 

 
 
[¶5]      Madeley filed an 
application for permanent partial disability (PPD) benefits in March 2002.  The Division issued a Final 
Determination denying Madeley's application for PPD benefits on the grounds that 
Madeley had not actively sought suitable employment and that his employment 
restrictions were due to his coronary condition, which was not compensable.  Madeley objected to the denial of 
benefits, and a contested case hearing was held on May 12, 2003.  Both parties presented evidence during 
the hearing.  In an order issued on 
August 16, 2003, the hearing officer upheld the denial of PPD benefits.  The hearing officer ultimately concluded 
that Madeley's inability to retain employment was due to a non-compensable heart 
condition and the economic conditions in Teton County, Wyoming.  
Madeley appealed to the district court, which reviewed the hearing 
officer's decision on the merits and reversed.  This appeal by the Division 
followed.

 
 

STANDARD 
OF REVIEW

 
 
[¶6]      When reviewing an 
administrative agency order, we review the case as if it came directly from the 
administrative agency, affording no deference to the district court's 
decision.  Hicks v. State ex rel. Wyoming Workers' 
Safety and Comp. Div., 2005 WY 11, ¶ 16, 105 P.3d 462, 469 (Wyo. 2005).  The scope of our review of an 
administrative agency decision is governed by Wyo. Stat. Ann. § 16-3-114(c) 
(LexisNexis 2005), which provides:

 
 
(c)        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.

 
 
[¶7]      When both parties 
submit evidence in a contested case proceeding, we apply the substantial 
evidence test:

 
 
In 
reviewing findings of fact, we examine the entire record to determine whether 
there is substantial evidence to support an agency's findings.  If the agency's decision is supported by 
substantial evidence, we cannot properly substitute our judgment for that of the 
agency and must uphold the findings on appeal.  Substantial evidence is relevant 
evidence which a reasonable mind might accept in support of the agency's 
conclusions.  It is more than a 
scintilla of evidence.

 
 

Cramer 
v. State ex rel. Wyoming Workers' Safety and Comp. Div., 2005 
WY 124, ¶ 10, 120 P.3d 668, 671 (Wyo. 2005); see also Newman v. State ex rel. Wyoming Workers' 
Safety and Comp. Div., 2002 WY 91, ¶ 12, 49 P.3d 163, 168 (Wyo. 
2002).

 
 
[¶8]      Even if 
sufficient evidence is found to support the agency's decision under the 
substantial evidence test, this Court is also required to apply the 
arbitrary-and-capricious standard as a "safety net" to catch other agency action 
which might have violated the Wyoming Administrative Procedures Act.  Decker v. Wyoming Medical Comm'n, 2005 WY 160, ¶ 24, 
124 P.3d 686, 694 (Wyo. 2005).  
"Under the umbrella of arbitrary and capricious actions would fall 
potential mistakes such as inconsistent or incomplete findings of fact or any 
violation of due process."  Id. (quoting Padilla v. State ex rel. Wyoming Workers' 
Safety and Comp. Div., 2004 WY 10, ¶ 6, 84 P.3d 960, 962 (Wyo. 
2004)).

 
 

DISCUSSION

 
 
[¶9]      The parties 
squabble over whether or not the hearing officer's decision was supported by 
substantial evidence and was in accordance with law.  We need not decide the merits of the 
parties' arguments because we find that the hearing officer's findings of fact 
and conclusions of law are insufficient to permit an adequate judicial review of 
the Order denying benefits.

 
 
[¶10]   A hearing officer 
must

 
 
"make 
findings of basic facts upon all of the material issues in the proceeding and 
upon which its ultimate findings of fact or conclusions are based.  Unless that is done there is no rational 
basis for judicial review.  

 
 
*  *  
*  *

 
 
All of 
the material evidence offered by the parties must be carefully weighed by the 
agency as the trier of the facts; conflicts in the evidence must be resolved, 
and the underlying basic facts which prompt the ultimate conclusion on issues of 
fact drawn by the agency in sustaining the prima facie case made, or in 
rejecting it for the reason it has been satisfactorily met or rebutted by 
countervailing evidence, must be sufficiently set forth in the decision 
rendered."

 
 

Decker, ¶ 27, 
124 P.3d  at 695 (quoting Bush v. State ex 
rel. Wyoming Workers' Comp. Div., 2005 WY 120, ¶ 9, 120 P.3d 176, 180 (Wyo. 
2005)).  Simply put, a hearing 
officer must do more than state an ultimate fact or conclusion; he must 
thoroughly explain each ultimate fact or conclusion in order for an appellate 
court to determine upon what basis each ultimate fact or conclusion was 
reached.  Billings v. Wyoming Bd. of Outfitters and Guides, 2001 
WY 81, ¶ 13, 30 P.3d 557, 565 (Wyo. 2001).

 
 
[¶11]   In the instant case, the hearing 
officer failed to provide a sufficient explanation as to why he denied 
benefits.  For instance, aside from 
the minimal relevant facts set forth above, the Order simply contains a generic 
discussion of law the hearing officer deemed applicable.  Nowhere in the Order is an attempt by 
the hearing officer to apply his generic discussion of law to relevant 
facts.  Indeed, after finishing his 
generic, disjointed recitation of law, the hearing officer simply offers the 
following two statements:

 
 
14.       The 
evidence submitted to the Office indicates that the Employee's inability to 
retain employment was due primarily to a heart condition and not a compensable 
injury.

 
 
15.       The 
evidence submitted to the Office indicates also that the Employee's inability to 
find work is due to a large extent to economic conditions in the Teton County, 
Wyoming area.

 
 
Immediately 
following these statements, and without any further explanation, 
is:

 
 

Order

 
 

IT IS 
HEREBY ORDERED that 
any and all claims for permanent partial disability benefits by the 
Employee/Claimant be, and hereby are, denied and this matter is returned to the 
Wyoming Workers' Safety and Compensation Division.

 
 
Because 
of the proximity to the clause ordering the denial of benefits, we can only 
conclude that the above-quoted two statements constitute the ultimate basis for 
the hearing officer's decision.  
However, we are unable to find any support in the Order for these two 
statements.

 
 
[¶12]   The hearing officer's first 
statement is that the evidence "indicates that [Madeley's] inability to retain 
employment was due primarily to a heart condition."  Absent from the Order is any explanation 
concerning the employment opportunities denied Madeley because of his heart 
condition versus his compensable injury.  
There is only one job referenced in the Order which Madeley was not able 
to retain because of his heart condition  his job as a construction 
flagger.  There is no mention of any 
other position or even any field of employment which Madeley is incapable of 
performing due to his heart condition.  
We fail to see how a reference to one job equates to the hearing 
officer's global finding that Madeley's coronary condition is the primary reason 
he cannot find work.  Further 
aggravating the situation is the obvious omission of the type of jobs Madeley is 
qualified for but cannot perform because of his compensable injury.  In the absence of such information we 
have no way to compare the two physical conditions and their impact on Madeley's 
employment prospects.  Given the 
lack of factual findings in the Order, we cannot evaluate the hearing officer's 
reasoning behind this first statement.

 
 
[¶13]   The hearing officer's second 
statement is that Madeley's "inability to find work is due to a large extent to 
economic conditions in the Teton County, Wyoming area."  This statement is likewise 
unsupported.  The Order contains no 
information regarding general economic conditions in the TetonCounty area.  The Order also fails to set forth any 
information concerning specific economic conditions which impacted Madeley's 
search for employment.  The Order 
only states that the same company that employed Madeley as a flagger would hire 
him as a traffic control supervisor, but that no such positions were available 
at the time.  Exactly how the 
unavailability of a specific job at a specific company reflects the economic 
conditions of the entire TetonCounty area is not explained.  The failure of the hearing officer to 
present any findings of basic facts to support this statement precludes this 
Court from finding a rational basis for judicial review.3

 
 

CONCLUSION

 
 
[¶14]   The hearing officer's findings of 
facts and conclusions are wholly inadequate to permit effective appellate review 
of the Order denying benefits.  The 
district court had before it insufficient information by which it could review 
the merits of the hearing officer's determination and, consequently, its 
decision is reversed.  We remand 
this case to the district court with directions to vacate the Order denying 
Madeley benefits for partial permanent disability.  The district court is directed to remand 
the case for supplemental findings of fact and conclusions of law or other 
proceedings consistent with this opinion.

 
 
FOOTNOTES

 
 

1In his 
Order, the hearing officer identified the year as 1998.  Reading the rest of the Order, it is 
apparent that this is a typographical error.  Other similar errors appear throughout 
the Order, of which we will not take further 
cognizance.

 
 

2While not in 
the Order, we note in passing that the record reflects that Madeley was awarded 
temporary total disability benefits.

 
 

3Also preventing rational review of the 
Order is the complete absence of any findings regarding credibility, the weight 
accorded the evidence, and the eligibility requirements for PPD benefits as set 
forth in Wyo. Stat. Ann. § 27-14-405(h) (LexisNexis 
2005).

 
 
HILL, 
Chief Justice, dissenting.

 
 
[¶15]   I respectfully dissent because I do 
not agree that the hearing examiner's order denying benefits is so insufficient 
as to preclude appellate review.  It 
is my conclusion that the findings made by the hearing examiner are, in some 
respects, in error but are sufficient given the record in this case.  It is also my view that the district 
court was correct in reversing the hearing examiner's order and directing that 
the Division award benefits.  
However, there is a threshold question with respect to the completeness 
of the record on appeal that, I believe, requires us to summarily affirm the 
district court's order.  

 
 
[¶16]   It is the appellant's burden to 
bring a complete record to this Court. Where a proper record is not provided, an 
appeal may be dismissed or review may be limited to those issues not requiring 
inspection of the record.  Befumo v. Johnson, 2005 WY 114, 
¶ 16, 119 P.3d 936, 942 (Wyo. 2005).  
Although that rule is more often applied in appeals coming directly to 
this Court from a trial court, there is no reason that it should not apply 
equally in these circumstances where the appeal comes to us from a district 
court sitting as an intermediate court of appeals.  The entire record was before the 
district court for its consideration.  
However, when the Division filed its designation of record in this case, 
it chose to designate mainly those portions of the record which were favorable 
to its position in this appeal.  
Resolution of the issues raised in this appeal requires that we have 
before us the complete agency record.  
For this reason, I would summarily affirm the district court's 
order.