Title: State ex rel. York Internatl. Corp. v. Indus. Comm.

State: ohio

Issuer: Ohio Supreme Court

Document:

[Cite as State ex rel. York Internatl. Corp. v. Indus. Comm., 107 Ohio St.3d 421, 2006-Ohio-
17.] 
 
 
THE STATE EX REL. YORK INTERNATIONAL CORPORATION, APPELLANT, v. 
INDUSTRIAL COMMISSION OF OHIO ET AL., APPELLEES. 
[Cite as State ex rel. York Internatl. Corp. v. Indus. Comm., 
 107 Ohio St.3d 421, 2006-Ohio-17.] 
Workers’ compensation — Mandamus – Adequate remedy at law — R.C. 
4123.522 – Due process – Failure to receive written notice of hearing and 
order does not violate due process when employer failed to seek relief 
under R.C. 4123.522. 
(No. 2004-1286 – Submitted July 26, 2005 – Decided January 18, 2006.) 
APPEAL from the Court of Appeals for Franklin County,  
No. 03AP-566, 2004-Ohio-3727. 
Per Curiam. 
{¶ 1} This is an employer’s appeal from the denial of mandamus on 
grounds of lack of notice of a workers’ compensation order.   
{¶ 2} Appellee, Robert Delaney, worked in the same plant in Elyria for 
over 25 years.  During that time, the plant changed ownership, the facility was 
expanded, and a new road was created for ingress to the grounds.  When Delaney 
began working there around 1970, the plant was owned by Luxaire, Inc.  On July 
1, 1981, Borg-Warner, the parent company of appellant, York International 
Corporation, acquired all of Luxaire’s assets, including the Elyria plant.  During 
his years at the plant, Delaney had several workers’ compensation claims.  A 
1979 foot contusion was minor and is not relevant to this appeal.  In June 1981, 
three weeks after York’s acquisition of the plant, Delaney injured his back.  This 
injury was much more serious, with extensive temporary total disability (“TTD”) 
benefits paid, followed by an assessment of 35 percent permanent partial 
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disability (“PPD”).  Delaney’s 1986 claim with York was also for a back injury, 
which resulted in a period of TTD and an assessment of 20 percent PPD. 
{¶ 3} Delaney eventually moved appellee Industrial Commission of 
Ohio for permanent total disability compensation (“PTD”), based on his two back 
claims.  Although Delaney listed his employer as “York International,” the 
commission sent the hearing notice only to “York-Luxaire, Inc.”1 and to a third-
party administrator, Gates McDonald & Company.  York was not notified. 
{¶ 4} Based on Delaney’s medical evidence and his nonmedical 
disability factors, the commission awarded PTD, splitting the payment 
responsibility evenly between Luxaire and York-Luxaire.  This time the order was 
mailed exclusively to Luxaire. 
{¶ 5} Luxaire, who was also represented by Gates McDonald, asked the 
commission to reconsider the allocation, since no impairment was attributable to 
the 1979 Luxaire foot claim.  The commission realized its error, and on March, 1, 
1995, issued a “corrected order” that reallocated the award equally between York-
Luxaire and York.  Again, that order was sent only to Luxaire. 
{¶ 6} On May 18, 1995, Gates McDonald, which represented York, 
wrote to the Bureau of Workers’ Compensation: 
{¶ 7} “Our office is in receipt of the attached notice from the DWRF 
[Disabled Workers’ Relief Fund] section that states that this injured worker has 
been declared permanently and totally disabled by the Industrial Commission. 
{¶ 8} “Please be advised that our records do not indicate that York 
International, Risk 3602, has ever been notified of any PTD hearings in for [sic] 
this claimant.  If there has been a determination of PTD it has not gone through 
                                                 
1.  Whether the Elyria plant ever operated under the ownership of “York-Luxaire, Inc.” is unclear.  
The hearing notice was sent to an address on Filbert Street, which was apparently the plant’s 
address at one time before York expanded the facility and created a new road for entering the 
grounds.  Apparently, that new road became the plant’s new address, although the facility never 
moved. 
January Term, 2006 
3 
the proper channels nor was proper notification of hearing been provided [sic] to 
the employer.  The employer does not recognize that this claimant is PTD in this 
claim or entitled to PTD compensation in this claim.” 
{¶ 9} On July 3, 1995, the commission issued a “corrected order revised” 
that repeated the allocation in the corrected order issued four months before and 
affirmed the grant of PTD benefits with a brief explanation.  This order was sent 
to York.  York did not respond. 
{¶ 10} For the next four years, self-insured York paid PTD without 
objection.  On August 31, 1999, York moved the commission to vacate its 
corrected and corrected revised orders, citing the lack of notice of the PTD 
hearing, the resulting PTD order, or the first corrected order.  At the hearing that 
followed, there was considerable debate as to why York had waited four years to 
seek relief from the PTD assessment against it.  After being pressed, York finally 
responded that it “did not pay attention” and decided to act only after the amount 
expended became significant. 
{¶ 11} A commission staff hearing officer vacated the 1994 PTD order 
and both corrected orders and reset Delaney’s PTD application for hearing.  
Delaney appealed to the commission and ultimately prevailed.  The commission 
ordered the prior orders reinstated after finding that York’s cause of action was 
barred by laches.  The commission found that York’s explanation for the four-
year delay was unacceptable, particularly considering that York was self-insured 
and responsible for monitoring its own claims.  The commission also determined 
that Delaney would be materially prejudiced: 
{¶ 12} “The final requirement for a finding of laches is that the opposing 
party be unfairly prejudiced by the delay.  The only proper relief available to 
York International, if not barred by laches, would be to rehear the permanent total 
disability application.  If this were done, this now 69-year-old injured worker has 
potentially lost eight years of time in which to seek vocational remediation.  York 
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International’s delay has limited the injured worker’s vocational options 
prejudicing both the injured worker and the administrator.  Furthermore, the 
passage of time has hindered the ability of any party to obtain reliable evidence in 
support of its position.  The unfair prejudice is obvious.” 
{¶ 13} York filed a complaint in mandamus in the Court of Appeals for 
Franklin County, alleging that the commission had abused its discretion.  The 
court of appeals denied the writ, citing both laches and the availability of an 
adequate remedy at law pursuant to R.C. 4123.522 that York did not pursue. 
{¶ 14} This cause is now before this court on an appeal as of right. 
{¶ 15} At issue is R.C. 4123.522, which entitles an employer to written 
notice of “any hearing, determination, order, award, or decision.”  This 
requirement, of course, derives from due process, and where notice has been 
compromised, so, too, have the aggrieved party’s due process rights. 
{¶ 16} York did not get written notice of the PTD hearing, nor did it 
receive the August 4, 1994 and March 1, 1995 orders that followed.  Delaney 
claims that York had notice nonetheless, because all employers used the same 
third-party administrator — Gates McDonald — and a Gates McDonald 
representative was present at the 1994 PTD hearing.  This assertion lacks merit 
for two reasons. 
{¶ 17} First, contrary to Delaney’s suggestion, Luxaire and York are not a 
single entity distinguishable only by name.  They are separate entities with 
separate interests to protect, 
notwithstanding 
their 
common 
actuarial 
representative.  Luxaire and York are both self-insured, so a single representative 
could not fairly represent the best interests of both on the same claim. 
{¶ 18} Second, unrebutted affidavits establish that the Gates McDonald 
representative present at the PTD hearing was not there on York’s behalf.  
Coupled with the commission’s failure to send any of the disputed documents to 
January Term, 2006 
5 
York, York has safely established that it did not receive the notice demanded by 
R.C. 4123.522. 
{¶ 19} R.C. 4123.522 also has a saving provision.  Upon discovering that 
it did not receive notice, a party can petition the commission for relief.  The 
commission will then determine whether the failure to receive notice (1) was 
beyond the control of and without fault of the aggrieved party and (2) was not 
ameliorated by any actual knowledge that the party may have had of the 
information contained within the notice.  Once the commission finds that these 
criteria have been satisfied, the party may “take the action afforded such person,” 
most commonly, the belated right to appeal, within 21 days. 
{¶ 20} The saving provision creates “an administrative remedy for a party 
claiming a failure of notice.” Cantrell v. Celotex Corp. (1995), 105 Ohio App.3d 
90, 94, 663 N.E.2d 708.  The availability of an adequate administrative remedy 
constitutes a plain and adequate remedy at law that forecloses mandamus relief.  
State ex rel. Buckley v. Indus. Comm., 100 Ohio St.3d 68, 2003-Ohio-5072, 796 
N.E.2d 522, ¶ 13.  York did not seek relief under R.C. 4123.522.  It cannot 
persuasively deny its failure, but instead seems to suggest that this failure be 
excused, either because of the type of order involved or because due process is 
involved.  A party seeking the extraordinary relief of mandamus cannot be 
relieved of the burden of proving the elements necessary for granting the writ.  
Mandamus cannot issue in the presence of a plain and adequate remedy at law.  
York refused to avail itself of that remedy.  Mandamus is, therefore, foreclosed 
regardless of the character of the order or underlying issue in dispute. 
{¶ 21} The judgment of the court of appeals is affirmed. 
Judgment affirmed. 
 
MOYER, C.J., RESNICK, LUNDBERG STRATTON, O’CONNOR, O’DONNELL 
and LANZINGER, JJ., concur. 
PFEIFER, J., concurs separately. 
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__________________ 
 
PFEIFER, J., concurring. 
{¶ 22} I agree with the majority opinion.  I write only to point out the that 
Gates McDonald & Company’s representation in the underlying case is a 
reflection of the type of ethical anarchy this court tacitly approved of in Cleveland 
Bar Assn. v. CompManagement, Inc., 104 Ohio St.3d 168, 2004-Ohio-6506, 818 
N.E.2d 1181.  In CompManagement, this court found that third-party 
administrators that represent employers before the Industrial Commission are not 
engaged in the unauthorized practice of law. Id. at syllabus.  Good for Gates 
McDonald.  Exempt from the ethical constraints of the legal profession’s Code of 
Professional Responsibility, this firm was able to represent one client against 
another client’s interest without obtaining a waiver regarding that conflict and 
then claim that the second client had no knowledge of the hearing that its 
representative had attended.  And Gates McDonald will never have to answer to 
this court for any ethical shortcomings in its representation of clients.  Nice work 
if you can get it. 
___________________ 
Buckley King, L.P.A., Michael J. Spisak, Theodore M. Dunn Jr., and 
Harold R. Rauzi, for appellant. 
Esther S. Weissman Co., L.P.A., and Esther S. Weissman, for appellee 
Robert Delaney. 
Jim Petro, Attorney General, and Dennis H. Behm, Assistant Attorney 
General, for appellee Industrial Commission. 
______________________