Title: Tauese v. State, Department of Labor and Industrial Relations. C.J. Moon and J. Levinson Concurring in the results only. S.Ct. Order of Correction, filed 11/21/2006 [pdf].

State: hawaii

Issuer: Hawaii Supreme Court

Document:

LAW LIBRA

‘*¥FOR PUBLICATION IN WEST'S HAWAI'I REPORTS AND PACIFIC REPORTERS®

Sse
IN THE SUPREME COURT OF THE STATE OF HAWAI'I

 

 

~000-==

 

SIONE TAUESE, Plaintiff-Appellant

 

STATE OF HAWAI'L, DEPARTMENT OF LABOR AND INDUSTRIAL
RELATIONS; RITZ-CARLTON KAPALUA; MARRIOTT CLAIMS
‘SERVICES CORPORATION, Defendants-Appellees
(No. 26389) (CIV, No. 02-1-0414)

 

 

SIONE A, TAUESE, Claimant-Appellant

RITZ-CARLTON KAPALUA and MARRIOTT CLAIMS SERVICES
CORPORATION, Employer/Insurance Carrier-Appellee

and

SPECIAL COMPENSATION FUND, Appellee
(NO. 26899) (CASE NO. AB 2002-462 (mM) (6-00-03858) )

nnn SSe EE

No. 26389

APPEALS FROM THE SECOND CIRCUIT COURT AND
THE LABOR AND INDUSTRIAL RELATIONS APPEALS BOARD
(CIV. NO. 02-1-0414) &

(CASE NO. AB 2002-462 (m) (8-00-03858))

NOVEMBER 20, 2006

NAKAYANA, ACOBA, AND DUFFY, JJ.
WITH MOON, C.J. AND’ LEVINSON, J., CONCURRING SEPARATELY
 

sesyoR PUBLICATION TH WEST'S HAWAT'T REPORTS AN PACIFIC REFORTER*'
ee
NU ‘THE COURT BY

In this consolidated appeal Plaintiff /Claimant~
Appellant Sione A. Tauese (Appellant) appeals from (1) the
vanuary 27, 2004 Judgnent of the circuit court of the second
circuit (the court), granting the motion to dismiss or in the
alternative for summary judgment filed by
petendant's/Employer/Insurance Carrier-Appellees Ritz-Carlton
Kapalua (Ritz-Carlton) and Marriott Claims Services Corporation
(marriott) on Appellant's August 28, 2002 complaint for
declaratory and injunctive relief against Ritz-Carlton, Marriott
‘and befendant-Appellee State of Hawai'i, Department of Labor and
Industrial Relations (DLIR or Department) to halt proceedings
against Appellant for a fraudulent insurance act under Hawai'i
Revised Statutes (HRS) § 366-98 (a) (&) (Supp. 2005)* in Civil No.

1 Hawai" Revised Statutes (HRS) $ 366-98 (Supp. 2005), entitled
spravd violations and penalties,” provides in relevant part as follows:

(a) A fraudulent insurance act, under this chapters,
sani benefits, obtain benefits compensation

PEM rvices provided, or provides legel sesistance or

Counsel to obtain benefite or recovery

Secelt by doing the following:

ie} * Hisrenresentine or concealing » material tact!)

ia) An‘ ofte
constitute a:

Ti), “Claes c felony if th

 

under subsections (a) and (b) shall

value

  

‘the moneys

 

Sbeained er denied 1s not less than $2,000:

(2) Misdeneanor Lf the value of the moneys obteined
Or denied is less than $2,000; oF

(3) Petty aisdeneanor if the providing of false

Information did not cause any ronetary loss.
Any person subject te a criminal penalty under this
section shall be ordered by a court to make restitution to
Ssvlnsurer or any other person for any financial loss
fsteined ny she ineurer'or other person caused by the

 

(contained...)
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ee
2-1-0414, and (2) the October 7, 2004 Decision and Order of the

Labor and Industriel Relations Appeals Board (LIRAB) affirming
the decision of the Director of the DLIR finding, inter alia,
that Appellant committed @ fraudulent insurance act under the
aforesaid section in Case No. AB 2002-462 (M) (8-00-03858)), and
ordering a total suspension of Appellant's workers’ compensation
benefits, that Appellant reimburse Ritz-Carlton for attorney's
fees and costs incurred because of the fraud complaint, and that
Appellant pay $5000.00 to the Special Compensation Fund.? We
hold that fraudulent insurance acts under HRS § 386-98(a) (8) must
be proven by clear and convincing evidence. Inasmuch as the

continued)
(e) inLieu of the criminal penalties set forth in
subsect lon tah any person eno +iolates subsections (a) and

: x e
Testitution of benefits oF paysente fraudusently received
Gover thie chapter, whether received from an enployer,
Ynsure:, or the special compensation fund, to be made to the
Source fren which the compensstion was received, and one or
nore of the following:

 

 

(2)"" A-tine of not more than $10,000 tor each
‘iclations

(2) Bipehsion or termination of benefits in whole
or in parts

ie)" Reimbursenent of attorney's fees and costs of
the party or parties defrauded.

(ey wae the se

ene penalty shell be inposea except
Giaaislderstion of « written complaint that specifically
Glicges a violation of this section cecurring within two
Years of the date of said complaint.R copy of the
Ueplaine specifying the alleged violation shall be served
promptly upen the person charged. The director or board
Ehall issue, where's penalty is ordered, # written decision
Stating ¢l1 findings following = hearing held not fewer than
Enenty deys after written notice to the person charged. Any
person aggrieved by the decision may appeal the decision
Under sections 366-87 and 38

 

   

(Enphases added.)

2 Ritz-Carlton, Marriott, and the Special Compensation Fund are
collectively referred £0 herein ae Appellees

3

 

 
 

LIRAB found on the complaint of Ritz-Carlton and Marriott that

Appellant violated HRS § 386-98(a) (8) by @ preponderance of the
evidence rather than by clear and convincing evidence, we vacate
its October 7, 2004 decision and order and renand to the LIRAB
for a rehearing in accordance with this opinion. Because we
remand, we hold, further, that (1) Appellant has failed to show
that HRS § 386-98 (Supp. 2005) improperly delegates the police
power of conmencing @ proceeding to a private entity when
administrative penalties are involved; (2) a fraudulent insurance
act under HRS § 386-98 requires proof that the logical result or
purpose of a person's acts or omissions is to fraudulently obtain
benefits, and does not require that benefits actually be
received: (3) administrative penalties imposed pursuant to HRS

§ 386-98(e) are not criminal in nature: (4) misrepresentations
before the DLIR are not constitutionally protected by the First
Amendment; and (5) statements made to a physician during an
independent medical examination (IME) are not subject to the
physician-patient privilege. MWe conclude that Appellant has
failed to establish reversible error as to other points he raises
on appeal from the LIRAB decision.

We discern no reversible error committed by the court
in Appellant's appeal from the court's January 27, 2004 judgment
and affirm that judgment.

1h

On November 2, 2000, Appellant suffered an on-the-job

accident while employed as a housekeeper by Ritz-Carlton.

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Appellant fell while using a desk and chair as a ladder to clean
the ceiling. On November 4, 2000, Appellant saw Helen Percy,
M.D. (Dr. Percy) for treatment of his injuries. Dr. Percy
diagnosed Appellant as having suffered a lumbosacral strain, a
contusion on his right buttock, and a contusion on his left knee.
She certified that Appellant’s accident resulted in -disabiljty
for work, with the disability beginning on November 4, 2000.
on November 5, 2000, Appellant filed a workers’
compensation claim for the injuries sustained in the accident.
On November 13, 2000, he began physical therapy through Rehab
Outpatient Services at the Rehabilitation Hospital of the Pacific
(Rehab Outpatient Services). On December 4, 2000, Appellant had
@ follow-up visit with Dr. Percy. She concluded that Appellant
was still unable to work, even on half-time light duty, and
referred him to Darren Egami, M.D. (Or. Egami), an orthopedic
surgeon. Dr. Egami began treating Appellant on December 7, 2000.
Dr. Egami referred Appellant to George E. Powell, M.D.

(Dr. Powell), a neurologist, for a magnetic resonance imaging
(RI)? study of the lumbosacral spine. The MRI study was
performed on February 6, 2001. in his report dated February 12,
2001, Dr. Powell diagnosed Appellant as suffering from “(1]umbar
strain” and “[plossible bruise of the sciatic nerve area with
persistent sciatica.” In the “Recommendations” section of his

2 Magnetic Resonance Imaging (MRI) is = noninvasive diagnostic
technique that produces computerized images of internel body tissues end is
based on nuciesr magnetic rescnence of atome within the bedy induced by the

application of radio waves. Webster's Third New Int'l Dictionary,
http: //unabridged.nerrian-uebster.con (leet visited Ost~ 31, 2006) «

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report, Dr. Powell stated that “[fJurther physical therapy might

 

be of benefit. One might also consider referral to a chronic
pain clinic.”

on February 15, 2001, Dr. Egami certified Appellant as
vnable to work until March 2, 2001, when he released Appellant to
Light duty Work. on March 7, 2001, Dr. Bgami certified Appellant
as unable to work for three days due to pain in Appellant's lover
back. ‘Thereafter, Appellant was to return to light duty work.

Appellant met with Dr. Egami on March 29, 2001, at
approximately $:00 a.m. Dr. Egami noted that Appellant reported
lower back pain with @ severity of five-out-of-ten, on a scale of
one to ten. Dr. Egami released Appellant for work beginning the
next day, March 30, 2001. The release certification dated
March 28, 2001 did not restrict Appellant's hours, but indicated
no lifting greater than twenty pounds and no bending.

on that same day, March 29, 2001, Appellant was under

surveillance by McCormack Investigations, Inc. for Ritz-Carlton.

 

At approximately 11:26 a.m., Investigator Ivan Alatan (Alatan)
videotaped Appellant, along with several other men, skinning and
cutting the carcass of a cow near a ranch along Hana Highway.
Alatan's “synopsis Surveillance Report” sunnarizes observations
of Appellant bending over while skinning the cow, cutting meat
from the carcass, placing the meat inte plastic bags, and moving

the bags around the back of a pickup truck for approximately one

hour:
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11:26 a.m, - videotaped [Appellant] over approximately the
ext 17 minutes as he stood on the right side of the cow's
Corcass, bent at the waist appearing to skin the cow with)

the unidentified males, walked around to the rear of the
Carcass, spread his feet end legs wider than shoulder width,
Bent atthe waist, walked to his right, appearing te squat
Continuing to clean the carcass.

  

 

    

 

 

 

1m, ~ Videotaped (Appellant) over the next 1¢ minut
fae he stood, bent at the waset at the front of the ca
Bppesring co cut axay the hide with his feet and legs spread
Niger than his shoulders, stood upright, bent at the waist
Gppearing to cut away the left front Leg of the carca:

Stbod while carrying the 1e9, placea the leg in a large
fresh bag that an unidentified female held.

  

 

 

iio’ p.m, - videotape(d Appeliant) over approximately’ the
ext 30 minutes as he stood with his feet and legs spread
bpert at shovlder width, bent at the waist, stretched to his
rEght Spreading his legs farther apart while bending at the
Hight knee appearing to cut the ribs of the carcass, placed
fis right elbew on Mis right knee appearing to brace himself
While zeaching with nis left ars. + Dent at the waist
With his feet end lege spread.» . stood upright while
Corsying 2 piece of rib into large trash beg that an
Ghidentities fenale held open, stocd upright, bent st the
Moist continuing te cut pieces of the carcass, bent at both
Thees and squatted, stood upright, walked to the rear of a
pick-up appearing to wash a piece of the carcass, walXed to
fhe rear of the Nissan, stood next to the pick-up, lifted
his left leg onto the tailgate bending at the left knee,
Lifeea hineel! into the bed of the pick-up, bent at the
waist appearing to tie and 1ift the large trash bage
Containing the mest, arranged the bags in the bed of the
Eick-up, stood upright, bent at both knees to climb down off
Ehe bed of the pick-up, sit [esc] on the tailgate fore
Brief time

 

    

 

   

  

 

 

on April 2, 2001, Appellant was discharged from
physical therapy. On April 10, 2001, Appellant underwent a
functional capacities evaluation (FCE) at Rehab Outpatient
Services with occupational therapist John Mizoguchi (Mizoguchi) .
Appellant reported constant low back pain and being able to sit
confortably for only one hour at a time, being able to stand for
only fifteen to thirty minutes at a time, and being able to walk
for only thirty minutes at a time. The FCE concluded that
Appellant “was able to safely demonstrate material handling up to

the light to 1ight-medium physical demand characteristic of work
 

FOR FUBLICAION 8 WEST! § HAKAI' REPORTS AND PACIFIC REPORTER:

 

 

category,” for an eight-hour work day. However, the FCE
concluded that Appellant was not able to perform the housekeeping
job as described.

By letter dated April 26, 2001, Appellant was informed
by Marriott that it had scheduled an independent medical
examination/rating examination (IME) for him with David Toeller,
M.D. (Dr. Toeller) on May 9, 2001. Dr. Toeller conducted the IME
and submitted his “IME/(Permanent Partial Disability (PPD))
Evaluation Report” (IME Report) to’Marriott on May 9, 2001.

According to the IME Report, during the IME, Appellant
reported that his back was no different than it was a few months
earlier. He complained of pain in the lover back radiating into
his right leg and pain in his right hip. Appellant maintained he
was unable to sit or stand for very long, and could not walk for
nore than fifteen minutes without having to stop due to pain.
Appellant reported ‘that he was much worse if he had to bend over
to pick things up. He stated that he can no longer play tennis
or rugby oF go hunting due to back pain. Dr. Toeller recorded
Appellant grimacing and complaining of pain throughout the
examination. He further noted that when Appellant left the
office, “he was walking with an antalgic gait, demonstrating a
pain behavior regardless on which leg he would bear the weight.”

Dr. Toeller tested Appellant’s range of motion in his
lower back, but determined that “patient's ranges of motion could
not be determined with an inclinometer as they were outside of
the valid range on repeat testing, exceeding 20% differences trom

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the beginning to the end of the exai.” Appellant showed Dr.
Toeller a bruise on his right hip which he stated was from the
Novenber 2, 2000 injury. Dr. Toeller stated in the IME Report
that this was “nedically impossible.”

br. Toeller also examined Appellent’s hip motions. He
reported that “[o)n the right side, [Appellant’s] hip motions
were not measured due to his pain complaints.” Dr. Toeller |
observed, however, that Appellant had “excellent hip flexion in
the seated position when I was not testing him but could not
tolerate the hip flexion in thé supine position when T was
formally testing him, This is inconsistent.” Regarding testing
of Appellant's ability to raise his legs, Dr. Toeller reported:

Straight leg raising tests could be tolerated to no nore
than 15, (degrees) on either side, Noticeable grinacing and
Conplainte sf pain accompanies this perfectly syemetrical
Toes. inediately thereafter, the patient was able to sit
up ih 2 Jackinife poeition exceeding 90. (degrees) of
aight leg raising and have © conversation with me without
‘se alec most inconsistent:

      

  

Dr. Toeller observed that Appellant “was tender to superficial
palpation throughout the entire 15 circle and both sacroiliac
joints” and that “[t}his was inconsistent with the fact that T
could press hard on his back when I was helping him get off the
table without complaints.”

Dr. Toeller concluded that Appellant’s examination “

clearly and purposely factitious” and that “(t]he only objective
abnormalities on today’s examination were findings of a purposely
factitious examination.” Regarding the FCE, he stated that it

was “in error” and that Appellant “should be returned to full
 

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duty immediately.” In his final conclusions, Dr. Toeller found:

‘This gentleman sustained a sprain/atrain to his low
Back, contusions to the right nip ang left knee at
work’ 6 months age.
By all cbjective criteria, he is fully recovered with
no inpairnent, He has reached maximum medical
Inprovenent and is capable of full duty.
3. the patient would disagree with my determination{.]
Nevertheless, I am essentially sgnoring his. profound
Subjective complaints of pain ana inpairment since
they are Unresronable, inconsistent with normal pain
behavior, incompatible with his known cbjective tests,
fand accompanied by 8 factitious exam.

    

 

 

 

Dr. Toeller thus rated Appellant's permanent whole person
impairment at 08.

on May 10, 2003, one day after Appellant’s INE,
Dr. Toeller reviewed the surveillance video of Appellant recorded
on March 29, 2001. Upon reviewing the video, Dr. Toeller

submitted to Ritz-Carlton an “Addendum to IME/PPD Evaluation,”

sed

 

which included images from the video. Dr. Toeller a!
Appellant's actions on the video and reaffirmed his previous

conclusions:

In this video, (Appellant) is participating in
cleaning = large animal. He spends extended periods of tine
forward flexed at che lumbosacral spine with his hi
cutstzetened in front of him working. During this video
{appellant}. ie yp snd down several tines from that bent over
position, His flexibility is superior with forward flexion
Exceeding 100 [degrees] during this perioc. He has the
Shility to get up and down several tines without any sign of
pein behavior, gfinacing nor sre there any actions that
Mould be protective of @ sore back.

My IME Yesterday concluded that (Appellant) had given
ne a purposely-factitious presentation. This video simply
Cenfirme that opinion. There are unacceptable differences
Between [Appellant's] rather extrene fluid motions in the
video va, the presentetion that he sade to Dr. Egant on the
fone day the performance at the [FCE) 2 week-and-evhalt
Inter; and the inpaires performance he denonstrated in ay
office yesterday.

  

 

 

 

 

The doctor also noted that “[t]his tape further cements ny

feeling that the [ECE] wes in error.” Dr. Toeller considered

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oo

several possible explanations for these differences, but
concluded that “the diagnosis of the factitious presentation is
the only reasonable conclusion 1 can make.”

nu.

on May 23, 2001, Ritz-Carlton and Marriott requested
hearing before the Department to address Appellant’ permanent
disability. On August 7, 2001, the Departnent issued a, “Notice
of Hearing” stating that @ hearing would be held before the
Department on September 6, 2001. At the Septenber 6, 2001
hearing, Appellant appeared with a Tongan interpreter‘ and
without counsel.

Relying on Dr. Toeller’s May 8, 2001 report, counsel
for Rite-Cariton and Marriott argued that Appellant was “less
than candid” with Dr, Toeller during his May 9, 2001 examination.
counsel for Ritz-Cerlton and Marriott stated that, based on
De. Toeller’s 0% whole person impairment rating, it was their
position that Appellant was not entitled to any permanent
disability as @ result of the Novenber 2, 2000 accident.

Appellant described the Novenber 2, 2000 accident and
the treatment he had received from Dr. Percy, Dr. Powell, and
be. Egani. He testified that he still had pain in his back and
that he needed to Lie down for one hour after work due to the
pain. During cross-exemination by counsel for Ritz-Carlton and

+ Appellant states in hie opening brief in S.C. No. 26899 that he
immigrated free Tonga to find work. fe did not gradvate from high school in
Tongs of in the United States. Appellant's primary language 4s Tongan, which
he apesks st home. English i¢ his second language

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Marriott, Appellant maintained that his back was “very sore” when

he returned to work on March 30, 2001. He further stated that he

could no longer play tennis or go hunting.

Appellant testified that he had difficulty squatting

and bendin

 

[COUNSEL FOR RITZ-CARLTON AND MARRIOT?) : Can you bend
your knees? Can you squat down?

(APPELLANT) I can equat, but the pain will get worse
fon that on

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT): How Long can
you squat?

TAPPELLANT]: I think for squat, I no can go Jong and
stay on myself.

(COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: what's the
longest you can squat?

AIAEPELANT]? T don'® know. Maybe five seconds or
something.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: How about
bending over? If you are standing up end you have to bend
over, can you bend over?

TAPPELLANT]: can bend
it's not 10 seconds, 15 seconds

COUNSEL FOR RITZ-CARLTON AND MARRIOT?) ; Not longer?

[APPELLANT] Not longer.

(COUNSEL FOR RITZ-CARLTON AND MARRIOT2) : What heppens
Af you squat too long of you bend over too long, what
happens?

(APPELLANT) : You know, that point 1no can do that

{COUNSEL FOR RITE-CARLTON AND HARALOT?) ; Mould this

have been true beck in March, shen vou went back to-uorh of
‘thie wear?

TAPPELLAWT): Stil] the same the pain. If 1 no do
senething, it's not really worse the pain.” fut if T try to
force something, ‘that's when the pain cones on,

 

 

Fr but Like what T say,

 

(Emphases added.) Upon continued cross-examination, Appellant
reiterated that in March 2001, he could not squat for very long
and could not bend over for very long because of the pain. He
related that he disagreed with Dr. Toeller's report and that the
bruise he had on his right hip was from the Novenber 2, 2000

accident.

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Appellant was questioned ‘regarding Dr. Toeller’s 08

whole person impairment rating:

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: Did Dr. Egat
ever give you 2 rating - ~ ancther rating after he saw you?

(APPELLANT): No, he said he have to get back to you
quys because he already gave me to somebody else already.
He cane to the insurance, you guys supposed to find a doctor
for the rating. le seid’ if he is the ene to do it, he can
fell ne what rating on that tine, but the inaurance have to
find their own doctor for chat

(COUNSEL FOR RITZ-CARLTON AND MARRIOTT): This ie our
doctor, br. Toller? Or. Towller said you have a zero
percent rating?

TAPPELLANT) : Yeah.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT}: And you
Gteagres with he (rating)?

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT
you think st's woreh?

[APPELLANT]: 1 think Like 10.

{COUNSEL FOR RITZ-CARLTON AND MARRIOTT}: Ten percent?

[APPELLANT]: Yean. .

 

 

How much do

 

He testified that he did not do “any activities” and that “[a]11

I do is just go to church.” When asked if he was still able to

glean an animal after hunting, Appellant responded in the

negative,

(Emphases
Appellant
a week as

sometimes

but that he can try:
ICOUNSEL FOR RITZ-CARLTON AND MARRIOTT]: Can you do
that anymore = clean the aninal?

TAPPELLAN?] ¢ No
(COUNSEL FOR RI7Z~CARLTON AND MARRIOT?) : Did vou ever

TAFFELOANT]: Lcan trv. but 1 have a iot of friends, 2
Act of family they Sando that. Why | acing do ches if f'
use somebody to that?

TCOUNSEL FOR RITZ-CARLTON AND MARRIOTT]: That's if you

0 hunting:
TAPPELLANT] : That's if 1 go, but I don’t go hunting.

added). Upon questioning from the hearing officer,
recounted that he did stretching exercises three times
part of his rehabilitation and that pain in his back
woke him fron his sleep.

Prior to testifying at the hearing, Appellant had not

seen the surveillance video taken on March 29, 2001, and was not

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given Dr. Toeller's Addendum to IME/PPD Evaluation, dated May 10,
2001. After Appellant testified, the video was shown at the
hearing and Alatan narrated its contents. After the viewing of
the video, counsel for Ritz-Carlton and Marriott asserted, inter
alia, that the tape discredited Appellant's testimony and that
Appellant was being “less than candid” with ‘the DLIR.

Appellant then disputed that the tape discredited his

testimony:

 

Like even that one you can see the date. I no really 1
0 what 1 normally do. T can do but not too long. You can
See'the Gate: Ae soon a8 I bend a little bit, 1 feel the
Esck is sere, lots of tine I stand up. That one like be can
think whet Féting for accident. That one for ne i# not
Feally's big deal that one. Ino lifting snything heavy. 1
Jost try to help my friend for that one because we get some
DMN ike we take the com it's Just for the family, and Like
hat he say, he don't believe it, I think we can. show him
Tovhe can see with hie cun eye too. And that's all 1 can,
say.

 

After Appellant's statement, the hearing officer observed the
bruise on Appellant’s right hip. Upon viewing the bruise, he
stated that “[w]hat: T noticed was what appeared to be a bruise
mark approximately two inches by one inch on the right hip. And
it still actually retains the quality of a bruise, even though
one doctor - - was it May? And it’s now September?” The hearing
officer informed the parties that a decision would be forthcoming
and if they did not agree with it, they could appeal.

on Septenber 28, 2001, the Department issued its
Decision awarding Appellant benefits for temporary total
disability (27D), temporary partial disability (TPO), and
disfigurement. Specifically, regarding benefits, the Decision

state:

 

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a

‘a. (770]:_ (Wasting period: 11/4/2000 though 21/6/2000)
Beginning 11/7/2000 through 11/22/2000; 11/24/2000 through
B872e72080; 12/3/2000 through 3/1/2000) 3/7/2003 through
3/10/2001; 4/10/2001 only

NONBER OF WEEKS! 16.1429 '@ $ 402.49 = $6,497.36

Bo (teb]: beginning 11/25/2000 only: 11/27/2000 through
12/2/2000

NOMBER OF WEEKS: 1.0000 @ $262.49 = $262.49

 

 

4.) brSprouREMenn: 2" by 1" irregular scar, right hip, flat
Gnd faintly hyperpignented
ForAL: $400.00

 

Appellant was also awarded the cost of medical care, services,
and supplies as needed for the Novenber 2, 2000 accident. He was
not awarded permanent total disability or PPD benefits. There
was no appeal from DLIR's September 28, 2001 Decision.
ut.

on February 12, 2002, Ritz-Carlton and Marriott filed a
complaint for fraud against Appellant with the Department. In
Count I, the February 12, 2002 complaint alleged that Appellant

had made several misrepresentations resulting in him obtaining

 

benefits he was not entitled t

 

piaxenpasenieg the naate and en

ae st 7 Bh ha
abilities to nent hsb at Hao -auts 3
a ot Teel

5. [appellant] fraudulently obtained workers’
coapensation benefits under Chapter 366, (HRS), ax amended,
from ot lesst March 23, 2001 forward, by concealing
Information and/or misrepresenting to Mis medicel provider:
ane (Ritz-carlton/Marriott) the extent and/or nature of his
injuries, Be

‘Aisuch, the uadical providers continued to treat
Hopellane\ang-certify hin to be toabie to cesure Bia usus

emp custaay ie and collect [tsp1 end/or-chtain a soditied
position st ware

EAs ¢ Feavlt of (Appellant's) misrepresentations,
[nite-Carivon/iarriote) pase fer mecice) treatment end
Greninations which were not required, and made overpayment
SE tenporery Gusebility benefits and/or provided modi fied

 

 

 

 

45
‘*FOR PUBLICATION IN WEST’ S HAKAI'T REPORTS AND FACIFIC REPORTERS

ee

(Emphases

added.) In Count I1, Ritz-Carlton and Marriott further

averred that Appellant had misstated his work abilities and

therefore

Ritz-Carlton had provided him with housing benefits to

which he was not entitled:

(Emphases

8. JAppellant! ¢raudslenty sisrepresented hinselé to

be_disabled irom reallar duty work and requested (Bitz~
GGelscnl srovide hin with nousings Ae e result of these

Fequests, [Rits-Carlton/Marrictt) pase monetary
Feimbursenents to (Appellent) in an amount to Be shown at
hearing.

9. (Aopellanti fraudulently obtained workers’
‘sompensation benefits fron (Ricz-Cerlton| onder Chanter 306.
Beneritg, ‘These violations occurred from at least March 29,
2001 and continves ongoing.

 

added.) In Count ITI, Ritz-Carlton and Marriott

averred that Appellant had violated HRS § 386-98:

(Emphases

following

11. [Appellant) has Sntentionally or knowingly acted
s0 as to cbtein benefits or recovery through fraud or decest
a5 defined under [HRS § 386-96], as anendes, as follows:

false or fraudulent clein “for the payment of a loss.

. Making, oF causing to be made, a false or
fraudulent claim for payment of @ health care benefit;

facts :
fs

 

G. Fabricating, altering, concesling making @
‘entry Sh 8 document) and/or
fe. Making, or causing to be made, false or

fraudulent statenents or claims with regard to obteining
legal recovery or benefits:

 

added.) Ritz-Carlton and Marriott requested the

relief:

2. Criminal cenalties as afforded by law and/or;
2. (Auoellantl be assessed the fine cf not more than

‘3: Suspension or termination of workers’ compensation
benefits in whole or part and/or

4. Suspension or disqualification from medical caze,
services or supplies, vocational rehabilitation servic
Gther services rendered for payment under Chapter 286,
HRS}, 8 snended and/or

Si Recoupment by (Ritz-Carlton/Marrictt} of 311
peyment® of mecical and indemnity benefits, including
howsing, under Chapter 366, [HRS], 8 amended, nan amount
to be shown at heating

6, Rament of (Ritz-Carlton/Marriott's] attorney's
tees and costs

    

‘ane

 

 

16
 

“eePoR PUBLICATION IN WEST'S IAWAL'T REPORTS AND PACIFIC REPORTER*
a

4. Such other and furthér relief ax the Director (of
‘the Departrent] eens just and proper in the prenises.

(Emphases added.)

on February 20, 2002, the Department informed Appellant
that Ritz-Carlton and Marriott had filed a complaint for fraud
against him and provided him with 9 copy of the complaint. The
pepartment also informed Appellant that “[i]£ it is determined
that you violated [HRS § 386-98], you may be subject to’ criminal
or adninistrative penalties; and benefits may be suspended or
terminated.”

on March 14, 2002, Appellant responded to the complaint
denying that he had violated HRS Chapter 386. He also asserted
defenses to the complaint stating, inter alia, that the
application of criminal penalties under HRS § 386-98 was
unconstitutional, the Department did not have jurisdiction over
criminal matters, and the complaint and HRS § 386-98 were
unconstitutionally vague. Appellant asked that Ritz-Carlton and
Narriott be denied aii relief requested and that he be awarded
attorney's fees and costs. On April 12, 2004, Appellant sent a
letter to Ritz-Carlton and Marriott stating that the letter
should be considered “a demand that [Ritz-Carlton and/or
Marriott] withdraw its complaint.”

on dune 20, 2002, Appellant filed a motion with the
Department for @ bill of particulars and demand for a
prelininery hearing and jury trial on “eriminel and other

penalties charged against [him]." On June 25, 2002, the

n
 

}FOR PUBLICATION IS WEST'S HAWAI'I REPORTS AND PACIFIC REPORTER:

———

Department responded by returning Appellant's pleadings and
informing Appellant that the complaint was filed under HRS
§ 386-96 and Hawai'i Administrative Rules (HAR) § 12-10-77, which
are within the jurisdiction of the Department. the Department
also informed Appellant that it “lecks jurisdiction in criminal
proceedings.”

w.

On August 28, 2002, Appellant filed a complaint in the
court naming Ritz-Carlton, Marriott, and the DLIR as defendants.
His complaint was docketed as Civ. No. 02-1-0414(1). He asserted
that a hearing had been set by the Department for Septenber 4,
2002 on the February 12, 2002 complaint filed by Ritz-Carlton and
Marriott, and that allowing the hearing against Appellant as to
administrative and criminal fraud would constitute double
Jeopardy and violate the U.S. and Hawai'i Constitutions.
Appellant requested declaratory and injunctive relief prohibiting
the Department, Ritz-Carlton, and Marriott from proceeding with
the hearing and any other appropriate relief.

On September 3, 2002, a hearing was held before the
Department. At the hearing, counsel for Ritz-Carlton and
Marriott stated that they intended to voluntarily dismiss Count
Ti, and that they would not contest any benefits paid to
Appellant pursuant to the Departnent’s September 28, 2001
Decision, including the TTD benefits paid for April 10, 2001.
Counsel for Ritz-Carlton and Marriott stated that the complaint
related to treatment and benefits received by Appellant after

18
 

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ee
March 29, 2001. Counsel for Ritz-Carlton and Marriott also

 

asserted that the fraud complaint was based on alleged
nisrepresentations made by Appellant at the September 6, 2001

pepartment hearing. Counsel for Appellant sought clarification
that criminal penalties would not be addressed at the hearing:

[COUNSEL FOR APPELLANT]: Before we proceed, one last
clarification from [Appellant]. (Ritz-Carlton and
Sersiote’s] complaint. Goes aldege criminal penalties.

THEARINGS. OFFICER)
alti sel lta ant

  

     

[COUNSEL FOR APPELLANT): Yes, T want to make clear for
the record = =
“THEARINGS OFFICER); The nly ceneltiex chat we aaseas

 

ESSERE APPELLANT]: Thank yoo.
(Emphases added.)

Mizoguchi testified at the hearing and stated that he
still believed his findings from the FCE were accurate. He
related that viewing the video taken on March 29, 2001 did not
Impact his findings inasmuch as he believed Appellant's
activities on the video suggested that he was experiencing pain.
Mizoguchi observed Appellant's facial grimacing and possible
stretching of the back. He stated that although he did not
disagree with br. Toeller’s findings, they were different than
his. Lastly, Mizoguchi reported that Appellant “[dJenonstrated
motivation” to return to work, that the results of physical tests
run on Appellant were consistent with his injuries, and that
Appellant “put forth good and valid voluntary effort during the
(ce).

At the hearing, Dr. Egami also testified. He stated
that it would have been his routine to discuss with Appellant the

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———

restrictions contained in the March 29, 2001 release
certification. Upon questioning regarding the March 29, 2001
video, Dr. Egami testified:

Well, like 1 said, 1 mean, when I write something Like
this, you know, Limitations for work, there is an unepoken
understanding that that applies to work and also to general
ectivities. You know, T con't write them for nothing. T
expect patients on [sic] follow what it de I'm recommending.
od T wouldn't have, you know, Wanted [Appellant] to do
that. "mean, T wouldn't have said it's okay to do thet.
you look like’ you'were working Yeally hard. And St didn't
appear that you're having any trouble doing that, That's
ot what I would have wanted you to be doing. If 1 excused
you from doing that at’work, way would Tsay okay, you can
ost on your tree tine as well, And that's the only thing
I think ebout that viceo, it saz not what T would haves you
know wanted hin to be doing,

 

 

 

(Emphases added.) When asked if Appellant had been “less than
candid” during treatment after seeing the video, Dr. Egami
responded, “I would say no, but that’s a no with a little bit of

mark.” Dr. Bgami also testified that Appellant's

 

activities on the video would have aggravated Appellant's back
pain. Dr. Egami indicated that he saw Appellant at some time in
June of 2002 for a follow-up visit, He further stated that
Appellant did not appear to show discomfort or back pain on the
video. However, on cross-examination by counsel for Appellant,
De. Egami testified that if Mizoguchi did not believe Appellant
was “stepping out of the bounds [of the FCE] in that video, then
that's probably accurate.”

Part of the video was shown and Alatan again narrated
it. Upon questioning by counsel for Appellant, Alaten maintained
that his report was not meant to indicate that Appellant was

bending over for the entire duration of the video. He viewed

20
pon PUBLICATION TN WEST'S HAMA'T REPORTS AND PACIFIC REPORTER***
‘Appellant bending over and standing up throughout the video,

 

Appellant's immediate supervisor, Robert Kaninay
(Kaninau), recounted that upon Appellant's return to work on
March 30, 2001, his work responsibilities were modified to comply
with Dr. Egani's restrictions of no bending and no lifting of
over twenty pounds. Kaninau declared that if Appellant needed to
Lift anything weighing more than twenty pounds at work, he was
given help, that he did not do any bending, and that he did not
operate the carpet cleaner, He stated that the restrictions
imposed by Dr. Egami ended at some time around April of 2001.
upon questioning by the Hearing Examiner, Kaninau explained that
wniie Appellant was working under Dr. Egami's restrictions, he

did not clean mold in bathrooms or move beds, as those tasks

 

required bending.

After testimony had been taken, counsel for Ritz~
carlton and Marriott argued that Appellant had made
nisrepresentations to Dr. Toeller and provided a “factitious
evaluation” in violation of HRS § 386-98. He stated that
Ritz-Carlton and Marriott were seeking suspension of any benefits
to Appellant from April 11, 2001 forvard and an award of
attorney's fees and costs.

attorney for Appellant introduced Dr. Powells
February 12, 2001 report into evidence and asserted that it
confirmed that Appellant was actually injured and that
br. Toeller ignored Dr. Powell's report. He contended that
wizoguchi provided “the best evidence . . . so fer in this case”

a
 

‘**FOR PUBLICATION IN WEST’ S HAWAI'T REPORTS AND PACIFIC REPORTER

SSS

inasmuch as he was not hired by either party to conduct the FCE.
Counsel for Appellant maintained that even assuming Appellant
nade misrepresentations to Dr. Toeller, Appellant did not receive
any benefits after March 29, 2001. The Hearing Examiner
declared that a decision would be forthcoming and concluded the
hearing. .
vw -

In the court on September 23, 2002, Ritz-Carlton and
Marriott filed their answer to Appellant's August 28, 2002
complaint. Therein, they raised numerous defenses, including,

alia, failure to mitigate, failure to exhaust all

administrative remedies, unclean hands, and an assertion that
jurisdiction was with the Department and/or LIRA, Ritz-Carlton
and Marriott asked that Appellant's conplaint be disnissed or
that judgment be entered in their favor, and that they be awarded
attorney's fees and costs, and any further appropriate relief.

On Septenber 25, 2002, Appellant filed a demand for
jury trial with the court.

On October 11, 2002, the Department issued its
“Decision” stating that Appellant willfully misrepresented his
Physical abilities to Dr. Toeller and at the September 6, 2001

Department hearing for the purpose of obtaining benefits, in

 

S| this statenent nade by countel for Appellant thet Appellant did
not receive any benefits after March 75, 2001 appears to be incerfect insesuch
ae the Departnent's Septenber 26, 2001 Decision awarded Appellant Teeporary
Total pisability (770) benefite for April 10, 2001, As diecorsed gunea,
counsel for Ritz-Carlton and Marriott stated that they did net contest those
‘90 benefites

 

 

 

22
seepoR PUBLICATION IN WEST'S HAMAI'T REPORTS AND PACIFIC REFORTER***
a
violation of HRS § 386-98 (8):

Tt is clear that (Appellant) did not receive any
sete nSbtlon to which he wae not entitied as a result of his
Sections. fonetheless, based on the activities that
ieppellant] wes fined performing on March 29, 2001, it 48

mI I
sealing oie eeemanent eee tase Secret

pee eS convened Zor the purpose of determining the
Tippeliant’s] entituement to (PFO) benefits. Ine
a wilful «

see tentation or cencesiner

ts F #
Eiri tor unich aduinistrative penalties ball be
assessed

(emphases added.) The Department assessed the following

administrative penalties:

1. Pursuant to [HRS § 386-98 (6) (1)1, (Appediant) shall pay
a fine of one lump sun of $5,000.00 into the Workers’
Gonpencation Special fund.

so forsuant. te [ARS § 386-96 (e) (2)), the [Appellant s)

Jenene te
zs 0.

eee eMdart to {HRS 6 396-98 (e) (6)], the (Appellant) shall

fbke veinhursenent tothe exployer/insurance carrier £0r

thet the

ceassuabie-titice carfier incurred in pursving this matter.

 

(enphases added.) On October 16, 2002, Appellant appealed the
october 11, 2002 “Decision” to LIRAB. On November 7, 2002, LIRAB
issued notice stating that an initial conference would be held
in the instant case on December 5, 2002, 2 settlenent conference
would be held on April 12, 2004, and 2 hearing would be held on
May 11, 2004.

on Novenber 29, 2002, the Department filed its answer
to Appellant's August 28, 2002 complaint in the court. Therein,
the Department argued, inter alia, that Appellant's complaint was
oot because the Department had already conducted a hearing for

civil penalties on Septenber 4, 2002. The Department raised the

23
‘+4FOR PUBLICATION IN WEST’ S HAMAI'I REPORTS AND PACIFIC REFORTERS*Y
 ..m

October 11, 2002 “Decision” as a defense inasmuch as it did not

 

impose any criminal penalties and contended that Appellant was
not entitled to a jury trial.

The initial conference, originally scheduled by the
LIRAB for December 5, 2002, was rescheduled and vas held on
January 9, 2003. On January 10, 2003, LIRAB issued ite “Pretrial
Order,” stating that the issues it would determine on appeal

2. Whether the [Departnent] erred in determining that

{Gppeliant) comitced fraudulent insurance acte ender [HRS $

seerse ey)

2. If yes,
A appropri

  

inether the penalty assessed by the [Departeent]

 

 

on May 5, 2003, Ritz-Carlton and Marriott filed their
“Wotion to Dismiss or in the Alternative for Summary Judgment” in
the court. They argued, inter alia, that the Department had
exclusive original jurisdiction over all disputes arising under
HRS chapter 386 and that Appellant had not exhausted his
administrative remedies as the LIRAB hearing was still to be held
on May 11, 2004.

on May 22, 2003, the Department filed a substantive
Joinder to the “Motion to Dismiss or in the Alternative for
Summary Judgment” filed by Ritz-Carlton and Marriott. In
addition to adopting the arguments made by Ritz-Carlton and
Marriott, the Department maintained that “[Appellent’s]
contention that the Department intends to permit en
adninistrative hearing as to criminal penalties for fraud is

patently untrue.”

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ee
vi.

 

In the court on May 23, 2003, Appellant filed his
vcross-Notion for Sunmary Judgment and Preliminary Injunction and
for Writ of Mandamus.” Therein, Appellant azgued, inter alia,
that HRS § 386-98 is unconstitutional because it improperly
delegates the state’s police power to private entities such as
Ritz-Carlton and Marriott, the police power of the state‘cannot
criminalize Appellant's statenents made at the Department

they are usually protected by the First

 

hearings becau
Anendnent to the U.S. Constitution, the criminal and .
administrative provisions found in HRS § 386-98 cannot be severed
since the acts leading to penalties under each are inextricably
woven together, and that even if HRS § 386-98(e) was deened

d without regard to the

 

severable, penal penalties would be impo
rules of evidence, a proper burden of proof, and notice as to the
specifics of the crime.

ith respect to the burden of proof issue, Appellant’ s
primary argument was that HRS § 386-98 is unconstitutional on its
face and as applied because the “statute provides no requirement
as to a burden of proof for the imposition of administrative
penalties," and, therefore, a “lesser standard than proof beyond
a reasonable doubt required in criminal prosecutions” may be
dened to apply. Appellant stated that he was “charged,
prosecuted, and fined” under the “substantial evidence” standard
of proof, which was a lesser standard than the “clear and
convincing evidence” standard used in civil cases of fraud.

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Appellant requested that the court issue a restraining order to
Prevent the DLIR, Ritz-Carlton, and Marriott from proceeding
against him before the LIRAB.

On June 3, 2003, Ritz-Carlton and Marriott filed their
opposition to Appellant's cross-notion in the court, asserting,
inter alia, that HRS § 366-98(e) does not impose criminal
penalties and that criminal penalties do not apply to
administrative proceedings.

On June 4, 2003, Appellant filed his opposition to
Ritz-Carlton and Marriott's May 5, 2003 motion, arguing that the
instant case did not “arise under Chapter 386,” so the court had
jurisdiction, and that the Department lacked the power to
determine the constitutionality of HRS § 386-98.

Also on June 4, 2003, the Department filed its
opposition to Appellant's cross-motion in the court. The
Department argued that “[Appellant) should proceed through the
administrative process” before the LIRAB, and that HRS § 386-98
is not unconstitutional on its face or as applied inasmuch as it
“epecifically provides for criminal of administrative penalties
for fraudulent acts under chapter 386, not both.” (Emphases in
original.)

On dune 6, 2003, Ritz-Carlton and Marriott filed their
reply to Appellant's opposition to their May 5, 2003 motion.
‘Therein, they contended that Ritz-Carlton and Marriott need not
be parties to Appellant's constitutional challenge of HRS § 386-
98 and that HRS § 386-98 se constitutional.

26
 

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EE
Also on June 6, 2003, Appellant filed his reply brief

to the Department’ s objection to his cross-notion in the court.
therein, Apellent easerted that only the court could determine
ve conestat sonality of HRS § 88-98 20 he wan not required to
canaust sninistcoive cenedies and HAE § 286-38 4s punteive in
on auly 34, 2003, the coors denvd Sea Torder, ranting
tnits-cariton ond Marriott's} Hoton to Bienes, of{,) in he
pavesnative,) Zor Sumacy Judgnnt fied My 5, 2009, ad (the
bepartnnt's) Sobetntive Joiner Fited Way 22, 2009 nd order
Denying [Appellant's] Cross-Motion for Summary Judgment and”
preliminary Insonction and for Wt of Mandamus Filed Mey 23
aoos.r4 The coast found that tthe question of conststutsonlity

 

«the court reasoned that in 1995, Hawaii's workers’ compensation
statutes were anended and that the atendnents, for the first tine, allowed
Sifenies to'be prosecuted criminally under HRS § 386-98(d). Accotding to the
ceeeeee ner MRS § 306-38 (ec), alternatively, the Department can treat workers!
seebthention fraud os a civil matter, The court seid the Appellant had not
eee ERS hsE tagctng scninistestive proceeding was “cleariy criminal in
Seer ett tna stoted that HRS § 386-90 ellows the Department to pursue
Oi Spenaltice win place of criminal proceedings and not concurrent with
[lininbl proceedingss purevant to HRS § 36€-98(e).” Further, the court noted
Ghat Sfipbelient] has hot presented any case law that stands’ for the
piopoaitios thet @ statute which provides an adninistrative agency with two
Peereest cue civil ang one criminal, i# per se unecnstitutional.” The court
ceeieined that HRS $ 3e6-98(e) does not authorize a term of imprisonment and
Ghat the commen law hes alwaye recognized an action for civil fraud as well ss
NEED fitua: Pirther, it was recognized that the legislature had created @
SEEukery‘penaity schene sn RE §°386°90 that is less harsh than the criminal
SESEMOTY Fetes fo the monetary amcunt neeaed for an offense to qualify ase
felony charge. The court concludes that the other possible penalties, e.g,
AeNeMuelSeGaa suspension of benefite, vere clearly civil remedies. “the
[etre explained thot the legislature “took greet pains to seperate civil
SGnetsont from erininel sanctions” and that there was no possibility that
ABSUGNesE cose would becone s criminel matter. Finally, the court concluded
Met jopeiiane hed fasted to exhavet his acninictrative renedies.

Re teen erder granting sunnary Jucgnent, "(ule review an award of
summary judgnent under the cane standaro eppliea by the circuit court."
(7 Li n eee Maw. 5, 106, 039 Pe2d 20, 22
e ti the pleadines, depositions,
Sone on file, together with the
(continved. ..1

 

 

   

 

    

 

 

 

(i900), “Sureary sudgent is eppropris
Gnewers to interfogetories, and acai

 

2
/+EOR PUBLICATION IN WEST’ § HAKAS'T REPORTS AND PACIFIC REPORTERS+®
ee

of [HRS § 386-98] hinges upon [the court] being required to

 

conclude that the proceeding which was commenced and which [was]
still ongoing [was] clearly criminal in nature.” The court
found, however, that “[(blased upon the record and the statutes,
this was a finding that [{t) could not make.”

Nonetheless, the court found that “assuming for the
moment in spite of HRS § 386-73 [(1993)"] . . . [it] had] the
egal authority to pass on the constitutionality of HRS § 386-98,
. [appellant] failed to meet his burden of overcoming the

statutory presumption of constitutionality and has failed to

 

EE any, show that there is no genuine sssue of material fact and
the moving party i¢ entitled to's judgeent as a matter cf low." dd, (internal
quotation marks and citation omitted); While we decide the court’s order was
Ultimately” correct, we do s0 based on the grounds stated in this opinion.
“(wjhere the circuit court's decision ss correct, its conclusion will net be
aisturbed on the ground that {t gave the wrong reason fer its reling.”” eves
‘y Kuboyana, 16 Hawai'i 137, 140, £70 F.2d 1261, 12€5 (2994)  (eiting Bxogke te
Mina, “73 naw. $66, 576-77, 036 8,26 1083, 1087 (1982)
gE Honolulu, 67 Maw. €99,'s07, 682 P.2a 1188, 1165 (1988) ee
Haw. 425, (30, 664 .2¢ 434, 736 (1963)). “This court nay affirm a Grant of
summary Judgment on any ground appearing in the record, even if the circuit
court gig nct rely.on it.” Ig, (esting

2 gis Haw. 40, 45, 814 Pad €6l, Bet TIDTNT

Metarthy v. Yesouku, § Haw. App. 45, 52,'678'P.20 1i, 16 (1984))

73 (1993) entitled “Original jurisdiction over
states as follows!

 

 

 

 

 

 

 

controversies,

Unless otherwise provided, the director of Iabor and
industrial relations shali have original juriediction over
all controversies and disputes arising under this chepter-
The decisions of the director shall be enferceable by the
circuit court as provided in section 386-9. There shall be
4a ight of appeal from the decisions of the director to the
Sppellate beara and thence to the cuprene court subject to
chapter 602 ae provided in sections 286-67 and 286-88, but
in ho case shall an appeal operate as 6 supersedeas of stoy
unless the appellate beard cr the suprene court #0 orders.

 

Effective July 1, 2006, there is “z right of appeal from the decisions of the
director, to the ppellete beard and thence tot

‘SoULE[,]" and net to the supreme court. HRS § 386-75 [Supe ZOU) tenphesis
soced)

 

 

28
sespon PUBLICATION IN WEST'S IDWAL'T REFORTS AND PACIFIC REFORTERY®

sn
Genonstrate the degree of irreparable injury necessary for
injunctive relief.” The court did not issue a finding as to “che
appropriate standard of proof under HRS § 386-98, The court
pitimately found “[t)here [was] no genuine issue of material
fact, and the law limits the [clireutt [elourt’s authority with
regard to HRS [e}hepter 386," and that Appellant “failed to
exhaust his administrative and Supreme Court remedies.”* :

con August 11, 2003, Appellant filed his notice of
appeal from the court's duly 14, 2003 order. This appeal vas
docketed as SC No. 25954. On Decenber 12, 2003, this court
dismissed SC No. 25954 on the ground that the court's July i4,
2003 order had not been reduced to a separate judgment, a8
required by Hawai'i Rules of Civil Procedure Rule 59.

In the LIRAS on January 9, 2004, Appellant filed’a
motion to stay proceedings. Appellant asserted that he intended
to appeal the court’s July 14, 2003 order once a final judgment

was entered. He maintained that the LIRAB should stay all

+ Tnasmuch es the LIRAB proceeding has been completed, the issue es
to exhaustion ef saninistrative renedies has become moot. Tt is well
SEeSBISERES thet this court will not consider issues before it that ha
[Become moot:

 

‘The duty of this court, as of every other judicial tribunel,
Tees sacide ectual controversies by a Judgment which can be
Eisried into effect, and not te give opinions upon moot
Guest ions of sbetract propositions, or to declare principles
QEules of lew whieh cannot affect the matter in issue in
the case before it. Courts will net consune tine deciding
Sbierace propositions ef lew or moct cases, and have no
SOridiction te do so,

   

 

kong v. Bd. of Recents, Univ. of Hawaii, 62 Haw, 392, 394-95, 626 P.2d 201,
Heit Tait Giciticne tnitted). Accordingly, we need not address Ritz-Cariton
itd macriceers argument (1), the Departnent’s argument’ (3), and Appellant! =
and Marricnent (1) regarding exhaustion of administrative renedies in the
court sppeal- See infra.

28
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proceedings until the constitutionality of HRS § 386-98 was

 

subject to this court's appellate review.
On January 28, 2004, the court entered ite final

judgment in favor of Ritz-Carlton, Marriott, and the Department,

and against Appellant. On Febfuary 6, 2004, Appellant filed his

notice of appeal from the court’s January 28, 2004 final

SC No. 26389.

 

judgment. This appeal was docketed
vit.
a
In the LIRAB on February 6, 2004, Ritz-Carlton and
Marriott filed their opposition to Appellant's motion to stay the
LIRAB proceedings. ‘Therein, they azgued, inter alia, that
Appellant was unlikely to prevail on his appeal and that he
should exhaust his administrative remedies.
on February 11, 2004, the Special Compensation Fund
fled its opposition with LIRAB to Appellant’s motion to stay the
LIRAB proceedings. The Special Compensation Fund advanced
similar arguments as did Ritz-Carlton and Marriott in their
opposition.
on February 20, 2004, the LIRAB denied Appellant's
motion to stay the LIRAB proceedings.
On March 12, 2004, Appellant filed his “Motion to
Dismiss Complaint and/or for Summary Judgment, to Dismiss
Criminal Charges, Compel Specificity and Particulars, and to Bar
Independent Medical Examination Report of [Dr. Toeller]” with the
LIRAB. Appellant argued, inter alia, that Ritz-Carlton and
30
 

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SSS

Marriott had failed to show that Appellant had committed fraud

 

Ansofar as he did not receive any benefits after March 30, 2001,
Appellant was not treated by Dr. Egami after December 30, 2001,
except for a follow-up visit in June of 2002, Appellant would not
be able to cross-examine Dr. Toeller, who had passed away, and
Appellant's statements before the Department were “self-advocacy”
and constitutionally protected conduct.

on March 31, 2004, Ritz-Carlton and Marriott filed
their opposition to Appellant’s March 12, 2004 motion with the
LIRAB. They argued, inter alia, that the Department never
considered or imposed any criminal charges against Appellant, the
fact that Appellant did not receive any PPD benefits is
immaterial because HRS § 386-98 is violated when a person acts
“so as to obtain benefits” through misrepresentation, and
Appellant could offer rebuttal evidence to Dr. Toeller’s report.

On April 1, 2004, the Special Compensation Fund filed
its joinder to the opposition filed by Ritz-Carlton and Marriott
to Appellant’s March 12, 2004 motion with the LIRAB. The Special
Compensation Fund did not make any additional arguments.

On April 8, 2004, LIRAB denied Appellants March 12,
2004 motion.

On May 3, 2004, the parties participated in a

settlement conference. A settlement was apparently not reached.

n, as stated previously, this statenent appears to be
incorrect inasmuch ae Appellant was awarded 77D benefite for Apeii 10, 2001,
See supra note 5

 

 

3
 

‘ss+FoR PUBLICATION I WE:
OO

The LIRAB hearing was conducted on May 11, 2004. At
that hearing, counsel for Appellant objected to the adnission of
br. Toeller’s reports, asserting that Appellant was unable to
cross-examine Dr. Toeller as the doctor was then deceased, Dr.
Toeller's expertise had not been established, and his report, was
not expert testimony but was, rather, “a conment on
credibility." Counsel for the Special Compensation Fund argued
in response that Dr. Toeller was still alive when his reports
were introduced into evidence at the Septenber 6, 2001 Department
hearing and that she believed he died on December 29, 2001. The
hearing Officer denied Appellant's request to exclude Dr.
Toeller's reports inasmuch as Appellant did not move to exclude
them either at the Septenber 6, 2001 or September 3, 2002
hearings and they became part of the Department file, the reports
were relevant, material, and not repetitious, and Appellant had
anple tine to develop rebuttal evidence.

Appellant testified that he was born and raised in
‘Tonga and did not graduate from high school. He stated that he
came to the United States in 1978, but still spoke Tongan at
home, and that English was his second language. Appellant
related that on March 29, 2001, he told Dr. Egami that he wished
to return to work and, therefore, Dr. Egami released him for work

starting March 30, 2002.

 

an hie post-ne
Appellant alec asserted that br. Toeller’s reports were hei
Felis to rade this ieeve on appeal

ing brief filed with the LIRAB on June 25,
reay. However, he

 

 

32
‘+#+70R PUBLICATION IN WEST'S HAWAI'I REPORTS AND PACIFIC REPORTER**#
During direct examination, Appellant gave a brief |

description of his involvement in dressing the cow:

(APPELLANT): 1 was helping only for ~~ and 1f they
‘show the video, I’m not really selping then on thet. 1 was
Starting help on -- for == I don't know how to =~ peel the
Skin, something 1ike that. And when I feel start get pain
fon my lower back, and then T'was sitting down on owner. of
fhe"farm truck. "He was pot dowa his bed, and T'was sitting
Goun there and talk story until they finish make the com.
And then I help them put the bag thing up, put the seat
inside. And ny nephew put all the bag inside the truc)

icotusel roR APPELLANT): The Bags of meat, how many
pounds you figure they weigh? °

IAPPELLAWE] : About 16, 2 pounds.

Appellant testified that he had trouble speaking with

 
    

 

 

 

Dr. Toeller and that he did not understand several things Dr.
Toeller had said to him, He also stated that he could not «
understand Dr. Toeller’s May 9, 2001 report.

upon cross-examination, Appellant testified that he

 

stood up during the dressing of the cow to stretch his back:

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT}: And to do the
<- the butchering, you hed to bend forward at your waist; is
that Fight?

[APPELLANT]: Yes.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: And you were
bent over at your Malet for kind of long tines?

TAPPELLANT]:"If the guys see in the video, it’s not
too long? and mostly I Just bent down little bit for, 1ike,
helping on sie) skin the cow and I-have to stand up: Its
ike exercise, And what the doctor went explain on that.
gene hearing in Wailuko 48 the kind of exercise it was.

 

   

icduiséL FOR RITZ-CARLTON AND MARRIOTT]: Okay. 80
ing at the beginning of the video you have to
‘S'-= and streteh your back or something?
[APPEDLANT): Right.
[COUNSEL FOR RITZ-CARLTON AND MARRIOTT): Okay,
we watch the video closely, we'll see that, oF you

hot on the ideo?
APPELLANT]: I don’t know Af on the video or not on

the video.
(COUNSEL FOR RITZ-CARLTON AND NARRIOTE): What else did

you have to do while you were skinning this cow to protect

your beck?
TAPPELLANT] : That's all.

 

 

 

 

 

Appellant further testified that during the approximately one

33
/°FOR PUBLICATION IN WEST’S HAWAI'I REPORTS AND PACIFIC REFORTER*#
hour it took to butcher the cow, he did only @ small amount of

 

 

work:

(apretane] And 1 no even finish up skinning
the cow. It’s only one side. And then T'was feel pain on
my lower back, and 2 wes eitcing down with owner of the
fern.” And we was talk story, and they finish working on the
cow.” Some tine I only cone down to help little bit is just
held the bag and hold sture like =~

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT): So you said
you weren’e doing most of the work; somebody else was?

(APPELLANT): Yes. 1 had ay brother-in-law and my
nephew that mostly do che work.

(COUNSEL FOA RITZ-CARLTON AND MARRIOTT]: Okay. And
yying that you only helped skin part of the com, and
then’ jou sit down and rest; se that whet you're saying?

[APPELLMNT]: Yeah. I no even ~~ when T sit down rest,
then some tine they ask me for,nelp. 1 come down again,
Like hold some other thing. But T’m not even finishing the
mole cow ayselt

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT): Okay. Did
you finish skinning the com, oF you saying you not =~ you
Sian! even do that?

(APPELLANT]: T went start, bot I never finish skinning
the come

(COUNSEL FOR RITZ-CARLTON AND MARRIOTT] : And you're
eying, then, after that, you only helped once in a while?

{aPPELiavt]: Yeah, once in a while.

[COUNSEL FOR RITZ-CRRLTON AND MARRIOTT]: And how long
id it toke to butcher this cow?

[APPELLANT]: Ino rerenber exactly. Maybe an hour

[COUNSEL FOR RITE-CARLTON AND MARRIOT] Okay. And
for that one hovr, how much of it did you spend cuvting and
stoee?

[APPELLANT]; For that one hour, only about 18 minut
I vas helping then.

[eOUNSEL FOR RITZ-CARLTON AND MARRIOTT)

(APPELLANT): Right

 

you're

 

 

 

    

   

 

 

 

25 minutes?

Appellant was questioned regarding his specific activities in

dressing the cow:

(COUNSEL FOR RITZ-CARLTON AND MARRIOTT)
cut any-of the neat and put it in the bags?

TAPPELLANT]: No, I'never cut any meat. Only I do
was holding the bag.

[COUNSEL FOR ITZ-CARLTON AND MARRIOTT]: Okay. So you
said you never cut neat and put it into Bags? Is that what
yousay?

APPELLANT): I no renenber if T cut neat.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: You ever cut,
Like, @ leg off ang put it into bes?’

TAPPELLANT] I'never 1ift up a eg

[COUNSEL FOR AITE-CARLTON AND MARRIOTT]: You never
1ift up a eg?

APPELLANT): Yes. I was holding a leg when they try
to clean up the inside, This is only when the cow wes,
Mine, Taying on the Back, and ==

 

band did you

 

 

 

38
“s++POR PUBLICATION IN WEST'S HAMAI'T REPORTS AND PACIFIC REPORTERS**

Sees

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT}: Okay. And ==
and wnen you were bending a Little bit, or wnat we call 90
Segree angie?

jabpELLAWT]: 1 don’t remenber what - - how hard I was
bending.

Appellant explained that he did not 1ift any bags and only helped

to arrange them in a truck:

{COUNSEL FOR RITZ-CARLTON AND MARRIOT?) + And how many
bags of mest did yoo get from that con? .

[APPELLANT]? About 15, 17 bagi].

[COUNSEL FOR AITE-CARLTON AND MARRIOTZ) : 25 to 17.

Ang you said ~~ after the bags were full of meat, cid yéu
Lite "any ef the bags?

[APPELLANT]: No.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: So you never
Lifted = baa?

(APPELLANT) : 2 no even LSft a bag. 1 remember T 1ift
= = 1 had two bag[s] of three beg(e) ie the one ~~ don’t
now how to explain that one, but from the inside the cow
after they cleen up and they put in the different bag. 80
One is the cut or) like, the = = Ihave = hard time to
Cxplain thet one, ‘but 1¢7e a1] che one on the meat. 1 never
Gven Ist up that on the mest. 2 wes berping them’ when T
ae go up oh the truck, just chat all the etuff was on top,
and J'eriea to make it goin the right way.

 

Appellant related that he vas aware that a Ot rating
meant he would receive no PPD award, but that @ 108 rating meant
he would receive some money, but that he had not testified that
he believed he should get a 10% rating to receive money:

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT]: Did you think
zero percent would sean you get zero money and 10 percent
Mould mean you get some money?

TaPPELLAN?]; Ef =~ if there wes, 7 would say yes, T ——
1 == 10 percent.

[COUNSEL FOR RITZ-CARLTON AND MARRIOTT): Okay. So
you're saying that you thought 10 percent would give you
Hone honey and zere percent would give you no money?

TAPPELLANT]: Yes.

 

 

 

icouRSEL FOR RITZ-CARLTON AND MARRIOTT]: At the
hearing on September 6, 2001, you testified you could not
squat for nore then 5 feconds, you could not bend for nore
than 10 to 18 seconds, you know, you only went to church,
and you ceuidn’t go hunting, thst kind of stuff. And we
were talking about the 10 percent rating that you thought
Jou should get. le the resson you testified about all this
Zforf because you thought you would get some money?

 

iabeeviant) < «ALL I want know - - the hearing -
= i noleven know what 2 the 10 percent to get money. T

38
FOR FUBLICATION IN WEST’ § HAMAI'T REPORTS AND PACIFIC REPORTER*+#

never even testify for get money. T testify whet they ask
ime the question. I was answer the question.

 

 

Alatan testified and narrated the March 29, 2001 video
while it was being shown. He stated that the video showed
Appellant cutting meat from the cow and lifting bags. Upon
cross-examination, Alatan testified that there were children
helping to carry meat and that he did not know how much the bags
being carried weighed. He also stated that the video showed
Appellant standing by the car and doing no work and resting while
sitting on a truck. The hearing was then concluded.

on October 7, 2004, the LIRAB issued its “Decision and

Order.” The LIRAB issued the following relevant findings of fact

(findings) +

4, tnmediately after (Appellant's) warch 29, 2001
office visit with DF, Egami, [hitz-cariton’s) pri
Investigator felloved (Appellant) and videotaped him fron
approximately 11:26 a.m. to 12:12 pim., helping two to three
ether men skinning and slaughtering » 300-400 pound caress:
of a cow on a grassy area near the tide of a rod.

During this period of tine, [Appellant] was videotaped
standing with 2 knife in his right hand, and repeatedly
Bending over to skin and slaughter the cow, and to bag the
reat_in trash bags. hen bending, [Appellant) stood with
hie fect apart ins stance wider than hie hapa. Ke would
then bend over at the waist with his ame infront of him to
either skin or cut the carcass.

[Appellant] alternated between bending over and then
straightening up in 2 standing position throughout this
period. Between 11:26 acm, and 12:12 p.m., (Appellant) bent
Over and straightened up about 44 times. [Appellant] also
Walked about of around the animal in between the bending and
Standing in order to Work on another pert of the carcacs.

At tines, (Appellant) was bent over for several seconds? at
other tines, he was Dent over for close to 20 seconds.
There were a few instan [appellant] stayed bent
over continuously fer nearly one minute:

Between 12114 p.m. 6 p.m, [Appellant] was
videotaped repeatediy standing and bending ever in the bed
ofa pickup truck arranging bags of meat. [at ]bout 12:16
Finsy iAppellant) got cot of the truck and walked over to
another truck, At'12:17 p.m., [Appellant] mas shown sitting
om on 2 truck bes.

Between 11:26 81m, and 12:16 poms, [Appellant was on
his feet practically the entire tine, standing, walking, oF
Banding overs fhnaylinnt did nat ardagen or aaninit a

 

 

   

 

 

 

 

  

 

   

 

36
seepon PUBLICATION IN MEST’ HAMAI'T REFORTS AND PACIFIC REPORTER**|

©. On May 9, 2001, (Appeliant) sew Dr. Toeller for a
permanent. impairment evaluation. [Appellant] knew the
Burpose of che evaluation and that cepending on the extent
Be hie smpoitment, he would receive sone monetary benefits,

ve) that js rating war Ob, Ae

tr After the (IME, Dr. Tocller reviewed the
surveiliance video. In report dated May 10, 2002, Dr
Toeller stated that there vere marked differences betw
[appellant's] presentation in the video and at his office.
Recording to Dr. Toeller, the video confirmed his belief
thse (appellant) gave # ‘purposely factitious presentation’
at the (INE). .

‘Sgptanber 6, 2001 (Depertment] searing
7th September 6, 7001, 2 nearing was held at the
[nepartsent] before hearings officer Rick Kelley. A notice
of the hearing was sent to (Appellant), notifying him that a
Rearing wecla’be held on Septenber 6, 2001, for the purpose
ef determining PPD, TT, and disfigurenent|

eo at the September €, 2001 hearing, [Appellant]
testified that he and Or. Egani discussed the need for # PPO
Eiting so that he could get on with ie life. " (Appellant)
farther testified that he disagreed with Dr. Toeller’s OF
Eating end had ciscussed Dr. Toeller’s rating report with
Be. Eons, appellant] believes that he should have been
Pited si0i~ fer his work injury. [appellant] testified that
fe stiii hed pein in the back everyaay, that he sometines
Pook overthercounter Tylenol for the pain, that he had been
Eestricted in his activities since the work injury, that
Sotside of work, he did not do anything except. ge to church,
Gast he could no longer go honting or clean animals, that he
Could try to clean animals, but would not have to, since he
fed fenily co de its and that he could only squat’ for about
S*Seconds at a time’ and bend over from 2 standing position
for no. onger than 25 seconds,

‘gi adver the Septenber 6, 2001 hearing, the
tbepartaent] issued a decision dated Septenber 28, 2001,
{nse"Gnorced, ‘onong other thines, TIO snd [TPD) benefits for
Verlous periods up through Apri 10, 2001. The (Departnent]

fermined thet (hppeliant) ad not’ sustain any PPD as a
Fesult of the November 2, 2000 work injury.

 

 

 

 

 

  

 

 

 

it! Gn'septenter 3, 2002, « hearing was held before
the [oeparenent] cn [Rité-cariion ond Rereiett’s) fz0ud
EGiplotnt, "aU the bearing, [Ries-Cartten and Marriott]
Presented the surveillance evigence to show that (Appellant)
Pogaieeeg frau ey alerepresenting his physseal conaition te
Sr, teciler at the Hay 37 2001 {IME], and to the hearings
Chistes tee Ibeperemerti) at the September é, 2001 hearing
Gn the extent of FFD

se eecabiieh sierepresentations by (Appediant) at the
septenter 6, 2001 hearing, (Rits-Coriton one Marriott) read
{nko the record portions of the transcript of the bearing
atehout obSectich fron [Appellant]. (appellant) alse. aig
hot ebject to tRite-curlten and sarsioeera] rellance on the
Tebeenones he node ot the hearing to support Ite complaint,
for freud. a

 

2
‘s+4FOR PUBLICATION IN WEST'S HAWAI'I REPORTS AND PACIFIC REFORTER*#*

12. By decision dated October 11, 2002, the
[Department] determined that [Appellant] committed fraud, in
viglation of HRS § 386-36(2) (8), when he misrepresented
and/or concealed his actual physical capabilities to Or-
Toeller at the May 5, 2001 [IME], and to hearings officer
Kelley at the September 6, 2001 hearing, for the purpose of
obtaining PPD benefits. Pursuant to HRS § 386-98{e), the
[Department] assessed various sdminietrative penalties
against. [Appellant],

     

 

14. [Appellant] confines that between March 29, 2001
and September €, 2003, his back condition was about the.
Gene, and that what he could or ould not do on Mazch 29,
2001, was the sane for September €, 2001

IS. Based on our review of the surveillance video that
documented [Appellant's] ability to bend repetitively for
Shout ¢4 times during 2 forty-five minute period, sometines
{bp to 20 to 80 seconds at 2 tine, to skin and slaughter a
cow, without evidence of discomfort and pain, end besed on
Dr. 'Toeller’ s report that. [Appellant] grimaced in pain
Ehtoughout the entire examination snd conpisined about pain
when Bending over, and being severely restricted in his
activities due to pain, together with the statenents be nade
fo hearings officer Kelley, including his statement that
Bending significantly worsened his back pain and that he

could not bend longer then 15 seconds,
tlm 2 ncesied bis tro

hearing before hearin

The ability to bend ond engage
in physical activity, as well as the level of pain that
perienced while performing physical activity are ma
facts to be considered in the evaluation of impel tment. and

disability. Ke find that [sppellant’s] knowledge of the
purnose for the MEL with Or, Toeller and the Sentesber 6,
(2001 hearing shows shat [éupelTantl_intenticnalay or

fa Tier and -besrincs officer Reiley forthe

     

Te, At trial, TAppelisnt) tried to mininize his
participation in the slaughtering of the cow.” [Appellant]
Kestified that he only helped skin part of the cow and did
hot cut any meat, that he only bent down a “litele Bie” to
help, and that he only helped fer 15 minutes out of the hour
er 50 it took to skin and slaughter the cow. -anpellant]

Scattadicted binselt ona number of occasions urine trial.

i fen in th
butcher: of the animal is certsinl
sunported By the aurveiiiance video.

38
s+e7oR PUBLICATION IN MEST’ S HAWAI'I REPORTS AND PACIFIC REPORTERS##
ee

Benalsics
17, The [Department] imposed on [Appellant] :

adninistrotive penalties in the form of a fine of $5,000.00,

iotospension ef all benefite, snd reimbursenent of

Setorney's fees and costs incurred by [Ritz-Carlton and

Marriott] te prosecute the fraud complaint.

 

(Emphases added.)

‘The LIRAB also issued the following conclusions of law

(conclusions) :

We _coneds o

 

i neu

Tn this cade, we found that [appellant] intentionally
or knowingly acted to misrepresent and/or concesl # material
fect selating te his physical capability so as to obtain PPD
Benefise, (Appellant) committed these fraudulent insurance
pets ‘at ine Tine] with Ors Toeller and at the Septenber 6,
201 hearing to determine the extent of PPD.

Wie do not agree with [Appellant] that he cannot be in
viclation ef HRS § 586098(a),, Because whatever acts he may
have committed did not result in an award of PPD benefits:
ty no Feauirenent i ests ee

   

 

  

 

 

ie siso co net agree with (Appellant) that (Rite~
iten and Harriott] failed to establish fraud under HRS §
See-se (2) (6) beyond @ reasoneble doubt or with clear and
Gonvincing evidence. Porsvent to HRS § 91-10(5) [ (Supp.
S08)}, we believe that the correct standard of proof in
Contested case hearing under Chapter 366 is preponderance of
Eke evidence, unless the low provides otherwise. ie

nol ait ah ha "

 

 

 

hee Tar Bs arte
Ttiwss nenticned in [Appellant's] post-trial
nenorandun thet [Rite-Carlton and Marriott) did not
[pecificelly ellege in its froua complaint that (Appellant)
BES nisrepresented hie physical condition to hearings
beficer Kelley ot the September 6, 2001 hearing. He note:

 

is reo rent Di
el net and wae
z su The [Department] issued an

detener 11, 700! decision finding fraud based on

appellant's] stetesents to Dr. Toeller and to hearings

officer Kelley.

Fecsraingly. any Leave relating to the eileged
Geficrency of [kitz-cariton and Marriott's} fraud compleint
fe not Before us

 

 

38
‘*¥+70R PUBLICATION It WEST'S HAWAI'T REPORTS AND PACIFIC REPORTERCSH
$s
2. naged on the foregoing, we concluse that the

foravent to HRs’ § 3-90 (0) for vielationd cf ane # 306-

Sea) (8) were appropriate
(Emphases added.) The Department’s October 11, 2002 “Decision”
was, therefore, affirmed by the LIRAB.

On October 15, 2004, Appellant filed his notice of
appeal with this court pursuant to HRS § 386-88 (1993) and
Hawai'i Rules of Appellate Procedure (HRAP) Rules 3 and 4. This
appeal was docketed as S.C. No. 26899 (the administrative
appeal). On September 5, 2006, this court consolidated the court
appeal and the administrative appeal under S.C. No. 26389.

vit.

 

In his appeal Appellant requests that this court issue
a writ of mandamus to restrain the State of Hawai'i, Rite
Carlton, Marriott, and the LIRAB from proceeding against him
without substantive’ and procedural protections. In the court
appeal, Appellant contends that (1) “[HRS § 386-98) is
unconstitutional because it is an improper application of the

Police power of the state,” inasmuch as (a) “[t]he filing of the

_WRS § 386-88 (1993), entitied “Judicial Review,” provides in
relevant part:

The decision or order of the ILIRAS] shall be fina!
fang conclusive, except a8 provided in section 386-69, unless
within thirty days after mailing of  certitied copy of the
decision or order, the [Department] or any cther party
appeals to the suprene court subject to chapter €02 by
filing e written notice of appeal with the [LIRAE].

 

 

Effective July 1, 2006, the decision or order may be appealed to the
intermediate court of éppeals, ond not to the euprene court, HRS $. 386-68
(Supe. 2008).

40
/\FOR PUBLICATION JN MEST’S HAWAI'I REPORTS AND PACIFIC REPORTERS**
oe
complaint in the [Department] is the conmencement of criminal

 

 

charges,” (b) “{t]he police power of the state may not be
constitutionally delegated to a private entity,” (c) the
“[plolice power of the state may not criminalize or penalize
protected conduct,” (d) [HRS,§ 386-98} is a penal statute,” and
(e) “[s]ince the acts constituting criminal and administrative
penalties are inextricably interwoven, the statute is not
severable,” and (2) “[t)he statute is unconstitutional on its
face and as applied,” because (a) “[e]ven if the statute were
dened severable, it would permit penal penalties without
adherence to rules of evidence, burden of proof, and other
protections,” and (b) [t]he [Department] has unbridled

discretion to impose penalties without appropriate guidelines.”

 

% tn gegponge in the court appeal, Ritz-Carlton and Marriott
maintained that (1) Appellant foiled to exhaust administrative renedies,
T2i"s{alo criminal charges were initiated by the (Departaent),” (3) “(tibia
he does sot invoive common law freud =. nor criminal fraud,” (4) "RRS
$°58eC90 sa constitutional,” insofar ae (a) st bears a rational. relationship
fo the Jegitinere state interest of preventing and punishing workers
Conpencat ion fraud, (b] "[x]hen appropriate administrative penalties are
Smposes, HES § 286-98 te not a constitutionally serious offense,” (e) "[s]ince
ine § 386-98 does not specify ancther evidentiary standard, the preponderance
Of the evicence standard applies,” and (d) “HRS § 386-96 16 not
Unconststutsonelly vague.”

Th response in the court appeal, the Departnent ai
(2) “[e}he [court] correctly concluded that’ (HRS § 286-98) was
Constitutional,” insamich as fa) “[e]he plain language of [HRS § 366-98)
Srovides for criminal of adninistrative penalties to be brought in the courts
Er'the administrative agency, respectively,” (emphases in originel), and
te MfaRs's 4ee-30], on ite face, does not delegate the State's police power
iSia private perty,” (2) "[t]he [cosre) correctiy ruled that (HRS § 386-98]
Ole noe entitie [appellant] to protections afforded » criminal defendant when
{appeliant] only feced civil adninistrative penalties,” (3) [t]he [court]
Uiictiy tuled that Appellant] was required to exhaust administrative

nedies before challenging the constitutionality of [HRS § 386-56) in the

ESurtes* end (8) *[t]he court properly denied (Appellant's) request for
Gnjunction ox a writ Of mandamus es (Appellant] has other means to challenge
the alleged wreng.””

Tnteply dn the court appeal, Appellant argues that (1) “[t]ne
[court] has orisinal juriediction te determine the constitutional validity of

A Eetuces and edminigtrative exhaustion ie not required,” (2) “[Rite-Ceriton
(Goneinved.--)

 

ete that

 

 

 

 

 

a
+*6FOR PUBLICATION IN WES?’S HAWAI'I REPORTS AND PACIFIC REPORTER

 

8.
In the adninistrative appeal, Appellant posits that
(2) “(HRS § 386-98) is an unconstitutional application [of] the
police power of the state, and is void on its face, and as
applied in this case,” (2) “(Ritz-Carlton and Marriott have]
failed to prove the essential elements of fraud," insofar as,
(a) “[a}ssuming arauendo that [Dr. Toeller’s) report was .
admissible, there was no proof that the representations or acts
of [Appellant] were ‘false,’ (b) “(t]he LIRAB relied on an
impermissibly low standard of proof,” (c) “[t]here was no proof
that the statements made to Dr. Toeller were made in
contemplation of [Dr. Toeller’s] reliance on them, and that {Dr.
Toeller] did rely on those statements,” (d) “[t]he statements of
(appellant] were immaterial, since no benefits were paid after
March 29, 2001 (as charged),” and (e) “[t]here was no legal
injury, i.e., detrimental reliance by [Ritz-Carlton], (3) [Dr
Toeller’s] report did not comply with the requirements to the
guides to the evaluation of permanent impairment,” (4) “(the
LIRAB] should have taken judicial notice of The Guide to
Permanent Impairment, Sth ed., AMA Press 2001, which provides the
analytical framework for the assessment of permanent impairment,”
and (5) “[Dr. Toeller] rejected, and did not ‘rely’ on

[Appellant's] statements.” In conjunction with his points on

 

(. continued)
and Warrictt) were required to prove by ‘clear and convincing evidence’ that
fraud wes connitted under [RS § s86-98(2) (€)],” and (3) "[2instiation of
criminal charges by 2 private party, and concurrence by the (Department)
constitutionally prohibited.”

 

  
 

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‘appeal, Appellant challenges findings 5, 6 7, 8 9, 11, 13, 14,
15, and 16. He also objects to conclusions 1 and 2. Appellant
also maintains that HAR § 12-10-77 was violated “in that the
complaint does not indicate the date, the nature of the
violation(s), and related docusentation as required(.)”

Appellant requests that this court reverse the LIRAB/s

decision.”

tp response in the administrative appeal, Ritz-Carlton and
Moreiots assert thet (1) “HAS § 386-98 is constitutional,” (2) “(in the”
(herpretation of a statute, great deference must be given to the
iMGiEretacion by the stave regulatory authority cherged with ite
Uiniserstion,” (3) "lujhie self-advocacy is permitted, misrepresentation is
acriataropriate and the basis for a fraudulent complaint should include not
Rely Bhat is icentities ina complaint, put should include all subsequent
Probeedinges” (4) "this case does not involve common law fraud or the
PaSependent tort of fraud. - . nor criminal fraud,” (8) “(t]he fact thet
Heese Segustay dig net ‘roceive any monetary benefit from his freud should
BPGlasegerded eens, § 386-98 requires only that the acts be done ‘so as to
Shesin benefits,’ (6) "islince there is no specific statute or rule
SUitalning to the epplicable standard of proof in workers’ compensation
Peaidulene insurance act cases in Hewal'i, the ‘preponderance of the evidence’
itandard applies,” and (7) the “Guides to the Evaluetion of Permanent
Inpaimment [were] appropriately used.”

In responce in the administrative appeal, the Speciel Compensation
rund maintains thet 1) “[Xppeliant's] points of error regarding challenges to
i'tunber of [findings] were net argued, thus, pursuent to (HRAP) Rule
Bein) (7), the points not argued should be deemed waived,” (2), “{LTRAB]

2000) Us Setebained thst [appellant] committed 2 fraudulent insurance act
Under {aks § 366-360) (€)," insofer as (a) “(HRS § 386-88] sets forth the
Wegeicenents fer a fraudulent insurance act under chapter 366,” (b) “[tIhe
Statute does net require the schene to connit fraud De successful,” (c) “(t)he
[Sglalacive history vetlects a legislative concern about fraud and an intent
iG%gcal harshly with indivicuele wno attempt to defraud the workers’
SCopentation aysten,” and. (a) "(t]he (LIRAB) correctly found that (Appellant
Sieigcea hes e”seerée,""(a} *(e]ne (LIRA) correctly applied the preponderance
Ue the evisence burden of proof as provided in HRS § 91°10(5),” and (6) “(HRS
$'s868o6) 1s constitutional on its face and as applied, and (Appellant) has
failed to articulate @ coherent argunent in challenging the statute's
Constitutionaliey.”

Sn reply in the administrative appesl, Appellant argues that (1)
s[flatiure to require epecification of charges is'# violation of due process,”
UP ixgpetient’s)  foncemental right to confront and cross examine @ witness

inst’ hin wat @ violation of dve process,” (3) “(HRS § 386-98] must be
Cicely construed," insofar ae (a) *{t)he statute is penal in character since
Strapplies peneiti¢s and forfeitures,” and (b) “[s]tatutes in derogation of
RESBE'GG Euce be strictly construed,” and (4) “[t)he use of a preponderance
Of the evidence standara is viciative of due process.

43

 

 

 

 

 

   

 

 

 

 

    

 

     

 

 
 

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1x.
“Review of a decision made by a court upon its review
of an administrative decision is a secondary appeal. The
standard of review is one in which this court must determine

whether the court under review was right or wrong in its

decision.” Lanai Co. v. Land Use Comm'n, 105 Hawai'i 296, 306-
07, 97 P.3d 372, 382-83 (2004) (quoting Soderlund v. Admin, Dir.

ofthe Courts, 96 Hawai'i 114, 118, 26 P.3d 1214, 1218 (2001)
(internal quotation marks and citation omitted).

Appellate review of the LIRAB’s decision is governed by
HRS § 91-14(g) (1993), which provides that:

Upon review of the record the court may affirm the
‘deckaion of the agency or renand the case with inetructions
fer further proceedings; or it may reverse or modify the
decision end order if the substantial rights of the
petitioners may have been prejudices because the
Saninistrative findings, conclusions, decisions, or orders

     

(2) Im violation of constitutional or statutory
provisions) oF

(2) Ip excese of the statutory authority or

Shrisdiction of the agency! oF

13) Made upon unlawfa! prccedures or

(8) Affected by other error of laws oF

(3) Clearly erroneous in view of the reliabii
‘probative, and substantial evidence on the

snole record: oF

(6) Arbitrary, or capricious, or characterized
by abuse of discretion or clearly

unwarranted exereise of discretion:

 

 

    

“Under HRS § 91-14(g), [conclusions] are reviewable under
subsections (1), (2), and (4); questions regarding procedural
defects are reviewable under subsection (3)7 [findings] are
reviewable under subsection (5); and an agency's exercise of
discretion is reviewable under subsection (6). ="

Hawai'i Newspaper Auencv, 89 Hawai'i 411, 422, 974 P.2d 51, 62

44
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a

(1999) (internal quotation marks and citations omitted).

 

ss(t]he courts may freely review an agency's
conclusions of law./" Lanai Cox, 105 Hawai'i at 307, 97 P.3d at

363 (quoting Dole Hawaii Div,-Castle & Cooke, Inc, v, Ramil, 72
Haw. 419, 424, 794 P.2d 1115, 1128 (1990)). The LIRABYs

conclusions will be reviewed de nove, under the right/wrong

standerd. Tete v. GIE Hawaiian Tel. Co., 77 Hawai'i 100, 103,
961 P.2d 1246, 1249 (1994) (citing State v. furutani, 76 Hawai't

172, 180, 873 P.24 51, 59 (29940).
“an agency's findings aze reviewable under the clearly

erroneous standard to determine if the agency decision was '

clearly erroneous in view of reliable, probative, and substantial

evidence on the whole record.” poe v, Hawas't eat:

Hd, 67 Hawai'i 191, 195, 953 P.2d 569, 573 (1996) (citing

Alvarez v. Liberty House, Inc., @5 Hawai'i 275, 277, 942 P.2d
539, 541 (1997); HRS § 91-14(g) (5). “*An agency’s findings are

 

not clearly erroneous and will be upheld if supported by
reliable, probative and substantial evidence unless the reviewing
court is left with a firm and definite conviction that a mistake
hae been made.’” Poe vy, Hawai'i Labor Relations Bd., 105 Hawai'i
97, 100, 94 P.3d 652, 655 (2004) (quoting Kilauea Neighborhood
Ass'n vy, Land Use Comm'n, 7 Haw. App. 227, 229-30, 781 P.2d 1031,
1034 (1986).

“the interpretation of a statute is a question of law
which this court reviews de novo.” Kuhnert v, Allison, 76
Hawai'i 39, 43, 668 P.2d 457, 461 (1994); see also Franks v, City

as
‘**¥FOR PUBLICATION IN WEST'S HAWAI'T REPORTS AND PACIFIC REPORTER*#*
S$ County of Honolulu, 74 Haw. 328, 334, 843 P.2d 668, 671 (1993).

“When construing a statute, our foremost obligation ‘is to

ascertain and give effect to the intention of the legislature,’

 

which ‘is to be obtained primarily from the language contained in
the statute itself.’” franks, 74 Haw, at 334, 843 P.2d at 671
(citations omitted) .
x

Initially as to his request for a writ of mandamus from
this court, it appears that Appellaht did not file a petition for
writ of mandamus with the clerk of this court and, therefore, did
not satisfy the procedural requirements set forth in HRAP Rule

21. Accordingly, we would not have jurisdiction to issue a

 

M As to jurisdiction concerning the writ of mandamus, “(s]11 cases
addressed to the jurisdiction of the suprene court...” shall’ be filed with
the suprene court as shall be provided by the rule of court.” HRS § €02-5(8)
(1393); gee also WRAP Rule 17 (stating that *[o]riginal actions sneluding

cations for writs or other relict, shall conform to the requirenents of
any applicable statutes and to such orders as mey be entered by the appellate
court te which the case 1s assignes” (exchasis eddea) |

WRAP Role 21(b) sete forth the procedural requirements for “writs

sndanus directed to a public officer"!

 

 

 

   

 

of

 

v1 Ti rs 7
he subrane court with proof of service on the officer and
The attorney general or the chief legal officer of the
court, as applicable. The petition shall conform to the
Feguitenents of subsection (s) of this rule. Upon receipt
of the prescribed filing fee, the sppeliste cleft shall
Gocket the petition and submit it te the supreme court for a
Geternination as to whether it will be entertained, If the
court elects to entertein the petition, it will be handled

oitice:

 

 

 

(Emphasis added.) RAF Rule 21(a) requires that [t]he petition shell
contain: (i) « statenent of facts necessary to an understanding of the issues
present int of iscues presented and of the relief sovnty ane
Gi) isons for Leeuing the weit.” HRAP Rule 2i(a) further
Girecte thet "iclopies cf any erder or opinions oF parte of the record thet
ay be essential te an understanding of the satters eet forth in the petition
shail'be attached to the petition.”

 

 
  

 

 

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writ of mandamus in this case.

As to 2 writ of mandamus from the court, we observe
that Appellant has provided no discernable argument that would
support an issuance of this extraordinary writ from the court.
‘this court may “disregard [a] particular contention” if an
appellant “makes no discernable argument in support of that |
position{.]” Norton v. Adnin, Dir. of the Court, 80 Hawa‘ 197,
200, 908 P.2d 545, S48 (1995) (citations omitted). Therefore, we
disregard Appellant's contentions as to the court issuing a writ
of mandamus.”

xr.

Appellant asserts that HRS § 386-98 is unconstitutional
because it is an improper application of the police power of the
state. Appellant must overcome the presumption that HRS § 386-
98 ie constitutional.!” Except with respect to suspect
classifications, “where it is alleged that the legislature has
acted unconstitutionally, this court has consistently held .
‘that every enactment of the lecislature is presumptive:
constitutional, and a party challenging the statute has the
burden of showing unconstitutionality bevond a reasonable doubt.

. + The int n
%—-necordingly, we need not reach the Department's argunent, (4) in

‘the cout apes! thot the court properly denied Appellent’s request for an
Gnjunetion or e writ of mandamus.

 

‘See Appellant's argument (1) in the court eppesl, and axgunent (1)
in the administrative eppea =

1 See Rite-Carlten ond Marriott’ # argument (4) (a) in the court
appeal

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‘s+4F0R PUBLICATION IN WEST’S HAWAI'I REPORTS AND PACIFIC REFORTER*#

 

unmistakable.” Blair v. Cavetanc, 73 Haw. 536, 541-42, 836 P.2d
1066, 1069 (1992) (internal quotation marks, brackets, and
citation omitted) (emphases added). In this regard, Appellant
asserts that the filing of the complaint initiated criminal
charges and HRS § 386-98 improperly delegates the police power of
commencing criminal charges to @ private entity." Appellant
states that he “does not challenge the statute as having
relevance to public health, or welfare, but on the basis that it
permits a private party to initiate a criminal complaint against
2 citizen, as occurred in this case, without the protections
inherent in ali criminal prosecutions.” (Emphases added.)
However, Appellant was subjected to the administrative
penalties set forth in HRS § 386-98(e), and not criminal
penalties. Under a plain reading of HRS § 386-98, the criminal
penalties set forth in subsection (d) are imposed by a court, and
not administratively. HRS § 386-98(d) states that “Lalny person
subiect toa criminal penalty under this section shall be ordered
bya-coust to make restitution to an insurer or any other person
for any financial loss sustained by the insurer or other person
caused by the fraudulent act.” (Emphases added.) Therefore, his

argunent is inapposite to this case.

 

  

"Sue Appellant's argunents
(3) Sn the court eppeal, and argument

Dy (2) (8) (2) (b}, and reply argunent
in the adninistrative sppeal-

 

See Ritz-Cerlton and Marriott's argument (2), and the Department! s
argunent (2) in the court appeal. We need not reach Ritz-Carlton and
Mazrictt'e argument (2) inthe acninistrative oppeal,

48

 

 
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Furthermore, HRS § 386-98(e) states that administrative

 

penalties may be imposed “[iJn lieu of the criminal penalties set
forth in subsection (d)." “In lieu of” is defined as “instead of
or in place of.” Black's Law Dictionary 803 (8th ed. 2004).
Hence, by its plain language, HRS § 386-98 provides for the
imposition of either criminal or administrative penalties against
a party found to have violated sections (a) of (b), but not |
oth. appellant, then, is incorrect in his assertion that the
criminal and administrative penalties found in HRS § 386-98 are
“inextricably woven.” On its face, HRS § 366-98 distinguishes
criminal from administrative penalties. .
Additionally, pursuant to HRS § 386-98(f), it is the
administrative proceeding that commences with the filing of a
complaint by a private party. By reference to the “director”
and the “board,” that secticn™ refers to the Department and the
LIRAB, and not to court proceedings as suggested by Appellant.
As the Department maintains, the plain language of HRS § 386-
96(d), which governs criminal penalties, does not allude in any

way to the commencement of criminal charges as a result of the

 

eg Department's argunent (1) (a) in the court appel.

int''s axgunent (1) (e} in the court appeal.

 

* gee Appel!

= RS § 386-1 (1993) defines the “director”
lebor and industriel relations.”

 

“the director of

HRS § 386-1 defines the “appellate boarc” as “the labor and
industriel relations eppeais boerd.”

 

% gee supes note 2
49
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filing of a complaint by a private party.”

Moreover, and as stated previously, Appellant was
notified that the Department did not have the power to preside
over crininal charges and would not be doing so. On January 25,
2002, the Department informed Appellant thet it “lacks
jurisdiction in criminal proceedings.” further, at the Septenber
3, 2002 hearing, as maintained supra, Appellant sought
clarification as to which penalties would be assessed, and was
assured that the Department could nét, and would not, be
assessing any criminal penalties. Accordingly, Appellant's
argunents that HRS § 386-98 unconstitutionally delegates the
state’s police power to private parties by permitting such
parties to file a complaint axe unpersuasive in this case.

xII.

Appellant also asserts that HRS § 386-98 “is

unconstitutional on its face and as applied." As to the most

substantive of his arguments,” Appellant contends that the

* See Department's argument (1) (b) in the court appeal.

% See Appellant's argunent (2) in the court appeals see also Ritz~
Ceriton ang Marriot’s argunent (1), and Special Conpensstion Fong's argument
(4) in the sdninistrative appeal

 

 

 

Appellant's claim that HRS § 306-98 1 unconstitutionally vague ss
without merits! Appellant was charged with “aisrepresenting of concealing @
1" HRE § 386-98 (emphasis added), ond argues thst “[a) charge of
Risrepresenting or cencesling s material fact begs the question 22 to whe
facts are ‘waterial,” snd under what circumstances.” This court has stated

 

 

  

 

 

 

that "lal penal statute is vague if a person of ordinary intelligence cannot
obtain an Sdequate cescription of the prohibited conduct or how to avoid
Committing illegal acte.*" state vy kag, 69 Haw, 463, 467, 768 Pead 372,375
(2586) (citations omitted). The term material fact” ie Gefined as “a fact
that ie significant of essential to the sesue oF matter st hend,” re Law
Dictionary "629 (Eth ed, 2004)-. Because this term is eesily cefinable and
allows 6 person of ordinary intelligence to cbtain an adequate description of
Teontinued.s-)

so
 

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a
statute allows for the imposition of criminal penalties, but

because it “provides no requirenent as to a burden of proof for
the imposition of administrative penalties,” the “substantial
evidence” (default burden of proof) under HRS § 386-85 would
Likely apply which is 2 “Lesser standard than [the] proof beyond

a reasonable doubt [standard] required in criminal

prosecutions.”

However, as discussed above, the fine that Appellant
was ordered to pay was an administrative penalty. See also
infra. Because Appellant was not assessed @ Yeriminal penalty,”
RS § 386-98(d) does not apply to him, and he thus lacks standing
to assert this claim. “In the absence of well recognized
exceptions, this court has clearly held ‘(clonstitutional rights
nay not be vicariously asserted.’" Exeitas v. Admin. Dir. of
Courts, 104 Hawai'i 483, 486, $2 P.36 993, 996 (2004) (quoting

Kaneohe Bay Cruises; Inc. v. Hizata, 75 Haw. 250, 256, 861 P.2d

24. -continued)
the premibited conduct, the statute is not unconstituticnally vogue. See also
Riteeéarlton and Marriott's argument (4)(d) in the court appeal

‘appellant sigo aeserts that HRS § 366-98 is overbroad. “The
doctrine of overbreadth, although closely related to a vagueness clain, is
QESETEEE Gh Ense hile a Statute may be clear and precise in its ters, it may
GeEIPES broadly that censtitutdonally protected conduct is included in its
aeeee focions.”” Statewe ful, 106 Hawai'i 462, 465, 92 P.34 471, 474 (2004)
sree Sootation neria and citations onitted). Appellant makes no argunent
{he conseStotionally protected conduct ie included within the statute's
protefiptions, hse, this argument is also without merit.

Rgpellant states that "(w)here # fundamental right is involved, @
constitutiene! standard that a statute aust survive is serutiny.*
SSeslisne feiees ne discernible argument ebout any fondenentel rights that may
DePingiicated in this case.

 

    

 

* Seg Appellant's argunent 2(a) in the court appea!

 

st
‘s*9FOR PUBLICATION IN WEST’ S HAWAI'I REPORTS AND PACIFIC REPORTER®#

+ 9 (1993) (citation omitted)) (footnote omitted) (brackets in

 

original).
Exceptions to the rule against vicarious assertion of
constitutional rights include the right to privacy and First
Amendment rights. Id, at 486 n.6, 92 P.3d at 996 n.6 (citing
State v. Kam, 69 Haw, 483, 488, 748 P.24 372, 375 (1988) (holding
that “sellers of pornographic items . . . possess the standing to
assert the privacy rights of those persons who wish to buy those
items to read or view in the privacy of the hone” because buyers
of pornography will usually never be subject to prosecution under
the statute at issue); State v, Bloss, 64 Haw. 148, 151 n.6, 637
P.2d 1117, 1121 n.€ (1981) (explaining that overbreadth doctrine
is an exception to traditional standing rules because “courts
recognized that the possible harm to society from allowing
unprotected speech to go unpunished is outweighed by the
possibility that protected speech will be muted”); State vi
Kaneakua, 61 Haw. 136, 597 P.2d $90 (1979) (clarifying that
overbreadth doctrine is inapplicable to cockfighting because no
constitutional right is involved); and State v. Manzo, 5@ Haw.
440, 445, 573 P.2d 945, 949 (1977) (explaining that overbreath
doctrine as applied to the First Amendment is an exception to
“traditional rule that a person may not challenge a statute upon
the ground that it might be applied unconstitutionally in
circumstances other than those before the court”)). Appellant's
arguments do not implicate any exception. Furthermore, assuming,
arauendo, thet the proof did not satisfy the “beyond @ reasonable

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doubt” standard required in criminal cases, because Appellant was

not assessed @ “criminal penalty,” the statute is not
unconstitutional as applied to Appellant.

Next, Appellant argues that statements he made to an
independent medical examiner and before the Department were
coerced and their use in his charge constituted a violation of
the prohibition against coerced confessions. ‘There is no,
relevance to this argument because Appellant was not a party to a
criminal proceeding.

Appellant states that “the use of the medical report by
a deceased doctor was permitted, as against the right to confront
and cross-examine witnesses,” and cites to State v. Adrian, 51
Haw. 125, 453 P.2d 221 (1969). Although Appellant does not
provide any argument as to why he cites Adrian, we note that
Adrian recognizes s right to confrontation under both the U.S.
and Hawai'i Constitutions. $1 Haw, at 130-31, 453 P.2d at 225;
nee U.S. Const. amend. VI ("In all criminal prosecutions, the

accused shall enjoy the right . . . to be confronted with the

 

witnesses against him.” (Emphasis added.}); Haw. Const. Art. I,

$6 (“Inall criminal proceedings, the accused shall enjoy the
right . . . to be confronted with the witnesses against the

accused.” (Emphasis added.)). The right to confrontation only

 

applies in “criminal prosecutions.” U.S. Const. amend. VIy Haw.

Const. Art. I, § 6. Because Appellant was not criminally

 

1% Soe Appellant's argument (2) in the court oppeel, snd argument (1)
and reply ergurent’ (2) an the ecuinistretive appeal:

53
 

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SSS

prosecuted, we reject his argunent that the use of the medical
report violated his right to confrontation.
xu.

Appellant states that HRS § 386-98 is a penal statute
because “the statute, on its, face, makes clear that a [fraudulent
insurance] act was sought to be made a criminal act” inasmuch as
subsection “(d) designates classifications of criminal conduct,
and classifications of penalties.” However, as mentioned
above, Appellant was assessed adninistrative penalties under HRS
§ 386-98 (e), and was not subject to criminal penalties under HRS
§ 386-98(d). ‘Therefore, Appellant's argument pertaining to
penalties imposed pursuant to HRS § 386-98(d) is inapposite.

xIv.

Appellant also states in a heading to his points of
error in the opening brief of his administrative appeal that the
LIRAB “erred by failing to. . . compel specificity and
particulars[.]" Appellant maintains that there was a violation
of HAR § 12-10-77 “in that the complaint does not indicate the
date, the nature of the violation(s), and related documentation
as required{.]” However, Appellant has failed to provide any
discernable argument regarding this point in his opening brief.”
Accordingly, pursuant to HRAP Rule 26(b) (7), as discussed supra,

We deem his challenge pursuant to HAR § 12-10-77 waived. We note

 

* Sag Appellant’ s argument 1(d) in the court appeal

sdnindetrative

 

% sue Spectal Conpensstion Fund's ergument (1) in the
appeal,
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a
that although Appellant has provided some argument regarding fhe

specificity of charges in his reply brief,” he has waived this
issue, and it would be unfair for us to address it. See Taomae
vs Lingle, 110 Hawai'i 327, 333 n.24, 132 P.3d 1238, 1244 n.d
(2006) (denying plaintiffs’ request for attorneys’ fees on the
basis that the request was raised for the first time in their
reply nenorandum (citing In re Hawaiian Flour Mills. Ing 76
Hawai'i 1, 14 n.5, 668 P.2d 419, 432 n.5 (1994) (holding that
arguments raised for the first tine in the reply briefs on appeal
were deemed waived); HRAP Rule 28(d) (2005) (stating that “(t]he
reply brief shall be confined to matters presented in the
answering brief”))).

XV.

Appellant next states that “it is clear that [he]
received a punitive sanction since the $5,000.00 fine [imposed
pursuant to HRS § 386-98(e)] was not related to any benefits or
payments received, nor to restitution to [Ritz-Carlton or
Marriott)."" Appellant, however, failed to contest finding no.
17. To repeat, uncontested finding no. 17 describes the
administrative penalties imposed upon Appellant and states that
“(these penalties are permitted under HRS § 386-98 (e) and appear
reasonable based on the evidence.” Since Appellant has not

challenged finding no. 17, it is binding on him as well as this

See Appellant's reply argument (1) in the aduinistrative sppeal
2 seg appellant’ argunent 1(¢) in the court eppesi.
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court. See Kelly v, 1250 Oceanside Partners, 111 Hawai'i 205,

227, 140 P.3d 985, 1007 (2006) (stating that “[glenerally, a
court finding that {s not challenged on appeal is binding upon
this court” (citations onitted)).™

Appellant does, however, contest conclusion no. 2,
which states that “[bJased on the foregoing, we conclude that the
administrative penalties assessed by the [Department] pursuant to
HRS § 386-98(e) for violations of HRS § 386-98(a) (8) were
appropriate." Conclusion no. 2 is based upon and flows logically
from finding no. 17. A conclusion that penalties are
“appropriate” is rationally supported by a finding which states
that the subject penalties “are permitted under HRS § 386-98(e)”
and that they “appear reasonable based on the evidence.”
Inasmuch as conclusion no. 2 is supported by uncontested finding
no, 17 and logically follows from it, we believe conclusion no. 2
is right. See Kawatiata Farms, Inc, v, United Agri Prods., 86
Hawai'i 214, 252, 948 P.2d 1085, 1093 (1997) (opining that “Lif
2 finding is not properly attacked, it is binding; and any
conclusion which follows from it and is a correct statement of
lew is valig” (internal quotation marks and citations onitted)).
Even if Appellant had properly attacked finding no. 17, though,
he fails to demonstrate that the penalties imposed upon him were

penal in nature.

 

 

m _ _hithoush denominated ae a finding of fact, finding ne. 17 appears
to involve « mixed question of law and fect.

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xvr.

We note preliminarily, pursuant to HRS § 386-98(e),
that “any person who violates subsections (a) and (b) may be

ect tot nists en of
benefits or payments fraudulently received . . . , and one or
nore” of the administrative penalties enumerated in HRS § 386-
98(e) (1)-(6)- (Emphases added.) Therefore, it 4s of no,
consequence whether, as Appellant contends, Appellant “was
subjected to fine, without imposition of administrative penalty
of restitution or benefits made or any proof of ‘payments
fraudulently received.'”

Furthermore, HRS § 386-88(2) does not require
correlation between a fine imposed under subsection (e), and
benefits received. HRS § 386-98 (2) includes within its
dulent insurance act” “acts or omissions

definition of 2 “fi

committed . . . so a8 to obtain benefits{.)"* (Emphasis added) .

Regarding the definition of “so as," it is stated that “so” is

 

soften used with a[n] . . . infinitive phrase introduced by
[*as"] that shows the logical result or purpose of an action done
in a specific manner with the following clause or phrase serving
to indicate the desired manner as well as the outcome of the
action.” Nebster's Third New Int’] Dictionary 2160 (1961); see

Singleton v, Liquor Comm'n, 111 Hawai‘i 234, 243-44, 140 P.3d
1024, 1023-24 (2006) ("where a term is not statutorily defined

See Rite-Coriton and Marriot’® argunent (5), and the Special
compensation Fund's argument 2(b) in the aduinistrative eppeal..

3

 
‘**80R PUBLICATION IN WEST’ S HAWAI'I REPORTS AND PACIFIC REPORTERS*#
SSS
+ + We may rely upon extrinsic aids to determine such intent.

are extrinsic aids which may be

 

Legal and lay dictionari
helpful in discerning the meaning of statutory terms.” (Internal
quotation marks, brackets, and citation omitted.)).

Therefore, in the context of HRS § 386-98(a), for a
fraudulent insurance act to occur, the “logical result or
Purpose” of “acts or omissions” must be “to obtain benefits.”
HRS § 386-98(a), then, does not require that a party actually

obtain benefits to be subject to a penalty. It only requires

 

that obtaining benefits was the “logical result or purpose,
Webster's Third New Int’] Dictionary at 2160 (emphasis added), of
the party's “acts or omissions,” HRS § 386-96(a). By its terms,
HRS § 386-98(a) would include an attempt to obtain benefits
inasmuch as the “outcome” of obtaining benefits was the “purpose”
of Appellant's actions.
This court has stated that “[s]tatutory construction

+ + + does not authorize the interpolation of conditions into a
statute -- additional terms -- not found in the statute
considered as 2 whole.” Hawaii Pub, Employment Relations Bd. v.

it Workers, 66 Hew. 461, 469-70, 667 P.2d 783, 789
(2983) (internal quotation marks and citation omitted). Because
the plain language of HRS § 386-98 does not require receipt of
benefits in order for a fraudulent insurance act to occur, we
decline to add such a condition to the statute.

* We need not re
in the adninisteative. opp

ch the Special Conpensaticn Fund's argunent (2) (e)

   

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Furthermore, we are “bound to construe statutes so as

to avoid absurd results.” Franks v, Hawaii Planning Mil) Found.
88 Hawai'i 140, 144, 963 P.2d 349, 353 (1998) (citation omitted).

 

To hold that an individual must have succeeded in receiving
benefits would penalize a vigilant employer or insurance carrier
that interdicted a scheme to obtain benefits through fraud or
deceit. Such a construction would also cause unnecessary cost
and delay in the prevention of fraud.

XVII.

Appellant acknowledges that a fraudulent insurance act
under HRS § 386-98(a) (8) is not denominated @ crime, Courts of
this jurisdiction, however, have recognized that “(t)he
legislature's declaration that a violation is non-criminal and
does not constitute a crime does not compel the conclusion that
the penalties for conviction of @ violation are civil rather than
criminal.” State v. Simeona, 10 Haw. App. 220, 231, 864 P.2d
1109, 1115 (1993), overruled on other grounds, State v. Ford, 84
Hawai'i 65, 929 P.2d 78 (1996). “(T]he question whether @
particular statutorily defined penalty is civil or criminal is a
matter of statutory construction.” Jd, at 229, 864 P.2d at 1114
(citing One Lot Emerald Cut Stones v, United States, 409 U.S.
232, 237 (1972); Helvering v. Mitchell, 303 U.S. 391, 399
(1938); see also United States v, Ward, 448 U.S. 242, 248
(1980)

‘The U.S. Supreme Court in Ward set forth a two-part
inguiry for determining whether a statutorily defined penalty is

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civil or criminal:

 

 

Our inquiry in this regard has traditionally proceeded on
two levels. First, We have set out to determine whether
Congress, in establishing the penalizing mechanism,
Undicsted either expressly of impliedly a preference for one
Lebel or the other. See Que ict Eeerald Cut Stones, 403
Ors. at 236-38. Second, where Congress has Indicated an
intention to establish @ civil penalty, we have inquired
further uhether the statutory scheme was so punitive either
in purpose or effect 42 to negate that intention

363 U-S- 603, E1?=21 (1960). IR regard
fo this latter inquiry, we have hoted that “only the
Clearest proof could suffice to establish the
bneonseitutionality of a statute on such a ground.” Id. at
627, "ee alae One uot Emerald Cut Stanaa{, 409 0.5. at_
250}; Rex Gratien Coy. United stares, 380 0.5. 148, 15¢
(2956).

 

 

 

   

448 U.S. at 248-49 (citations omitted).
As to the first inguiry, it is clear that the
legislature intended to impose an adninistrative penalty under
HRS § 366-98(e). Significantly, the legislature labeled the
penalties in HRS § 386-98(e) administrative, “a label that takes
on added significance given its juxtaposition with the criminal

penalties set forth in the inmediately preceding subparagraph,

 

(HRS § 366-98(d)]."" Ward, 448 U.S. at 249 (stating that
“[£}nitdally, and importantly, Congress labeled the sanction
authorized in [the statute) a ‘civil penalty,’ a label that takes
on added significance given its juxtaposition with the criminal
penalties set forth in the immediately preceding subparagraph”).
Therefore, “we have no doubt that [the legislature] intended to
‘allow imposition of penalties under [HRS § 386-96 (e)] without
xegard to the procedural protections and restrictions available
in criminal prosecutions.” Id, Appellant fails to cite any

authority or provide any argument that would persuade us to

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conclude otherwise, and contrary to the express intent of the

statute.”

As to the second inguiry, we “consider whether [the
legislature], despite its manifest intention to establish a
civil, remedial mechanism, nevertheless provided for sanctions so
punitive as to ‘transform what was clearly intended as a civil
remedy into a criminal penalty."" Id, (quoting Rex Trailer Cow
350 U.S. at 154 (brackets onitted)). We have applied the seven
considerations enunciated by the U.S. Supreme Court in Kennedy v.
MendozacMaxtinez, 372 U.S. 144 (1963), to determine whether,
“despite the stated non-punitive intent of the legislature, the
statute’s effects negate the state's nonpunitive intent.” State
ve Guidry, 105 Hawai'i 222, 235, 96 P.3d 242, 255 (2004). “this
List of considerations, while certainly neither exhaustive nor
dispositive, has proved helpful in [the] consideration of similar
questions, and provides sone guidance in the present case.”
Ward, 448 U.S. at 249 (internal citation omitted); see also
Guidry, 105 Hawai'i at 235-36, 96 P.3d at 255-56.

The seven factors are as follows: (1) “{wjhether the
sanction involves an affirmative disability or restraint”;
(2) “whether it has historically been regarded as @ punishment”;

(3) “whether it comes into play only on a finding of scienter";

 

(4) “whether its operation will promote the traditional aims of

punishment-retribution and deterrence”; (5) “whether the behavior

gee Rite-Coriton and Marriott's argument (4) (b) in the court
eppesl

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to which it applies is already a crime”; (6) “whether an
alternative purpose to which it may rationally be connected is
assignable for it"; and (7) “whether it appears excessive in
relation to the alternative purpose assigned(.]” Mendoza-
Martinez, 372 U.S. at 168-69. “(T]hese factors must be
considered in relation to the statute on its face." Id. at 169.
“it is important to note that not all factors must be satisfied
in determining whether a statute has punitive effects." Guidry,
105 Hawai'i at 236, 96 P.3d at 286 (citing Russell v. Gregoire,
124 F.3d 1079, 1086 (Sth Cir. 1997) (explaining that even though
“the statute imposes an affirmative restraint and imposes a
sanction traditionally regarded as punishment[, this] does not
override its nonpunitive nature”); Smith v. Doe, 538 U.S. 84, 97
(2003) (stating that Mendoza-Martinez factors are “neither
exhaustive nor dispositive” and are “useful guideposts”}).

With respect to the first factor, none of the
administrative penalties under HRS 366-98(e) impose any
disability or restraint and, therefore, do not approach “the
‘infemous punishment’ of imprisonment.” Hudson v. United States,
522 U.S. 93, 104 (1997) (quoting Flemming, 363 U.S. at 617)
(internal quotation marks omitted) .

As to the second factor, as stated above, Appellant
challenges that the $5,000.00 fine he vas assessed amounts to a
punitive sanction. However, money penalties have not
historically been regarded as punishment. Hudson, 522 U.S. at
104 (stating that “neither money penalties nor debarment has

«2
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historically been viewed as punishment”). Furthermore, “the |

 

 

payment of fixed or variable sums of money [is a] sanction which
ha{s] been recognized as enforcible by civil proceedings since
the original revenue law of 1789." Id. (quoting Helvering v.
Mitchel], 303 U.S. 391, 400 (1938) (internal quotation marks
omitted) (brackets in original). .

As to the third factor, a fraudulent insurance act
under HRS § 386-96(a) requires scienter, namely that an
individual act “intentionally or knowingly.” Accordingly, this
factor implicates an attribute of criminal punishment.

As to the fourth factor, we recognize that the
imposition of administrative penalties under HRS § 386-98(e) will
“deter others from emulating [Appellant's] conduct, a traditional
goal of criminal punishment.” Hudson, 522 U.S. at 105, However,
“the mere presence of this purpose is insufficient to render a
sanction criminal, as deterrence ‘may serve civil as well as
criminal goals.’” Id, (quoting U.S. v. Usery, 516 U.S. 267, 292
(1996) (citation omitted)). The legislative history of HRS $
386-98 indicates that fraud penalties were necessary to “insure

"conf. Comm.

 

the integrity of our workers’ compensation syst
Rep. No. 64, in 1985 Senate Journal, at 898. To hold that the
presence of a deterrent purpose renders such administrative

of the

 

penalties “criminal” would severely undermine the purpos!
workers’ compensation system. See Bocalbos v. Kapiolani Med,
Gir. for Nomen & Children, 69 Hawai'i 436, 442, 974 P.2d 1026,
1032 (1999) (stating that “[o]ne of the primary purposes of the

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Hawai'i workers’ compensation law is the prompt determination and

Gisposition of claims for compensation” (citing Iddings v. Mee
Lee, 82 Hawai'i 1, 8, 919 P.24 263, 270 (1996))).

As to the fifth factor, criminal penalties may be
imposed in lieu of adninistrative penalties for a fraudulent
insurance act under HRS § 386-98. See HRS § 386-98(e). However,
the U.S. Supreme Court has “noted on a number of occasions that
‘Congress may impose both a criminal and a civil sanction in
respect to the sane act or omission.’” Ward, 448 U.S. at 250
(quoting Helvering, 303 U.S. at 399; citing One Lot Enerald cut
‘Stones, 409 U.S. at 235). ‘The Court has “found significant the
separation of civil and criminal penalties within the sane
statute,” as in this case. id; see also Helvering, 303 U.S. at
404; One Lot Emerald Cut Stones, 409 U.S. at 236-37, Therefore,
this factor cannot be said to weigh in favor of Appellant's
argunent.

As to the sixth factor, as noted above, “to insure the
integrity of the workers’ compensation system,” the legislature
strengthened the prohibition against fraud within the system.
Conf. Conm. Rep. No. 64, in 1985 Senate Journal, at 698.
Therefore, it is apparent that there is an alternative purpose to
which the adninistrative penalties under HRS § 386-96(e) are
rationally connected.

As to the seventh factor, HRS § 386-98 (e) (1) Limits
Hines to “not more than $10,000 for each vielation” and,
accordingly, affords discretion in their imposition. Based on

6s
“s++POR PUBLICATION IN WEST'S HAWAI'I REPORTS AND PACIFIC REPORTERS##

 

that may be imposed under

 

this, it cannot be said that the fine

HRS § 386-98 (e) (1) would be excessive especially in light of the

 

legislatures objective of preserving the integrity of the
workers’ compensation system. See Flor v, Holauin, 94 Hawai"
70,.79, 9 P.3d 382, 391 (2000) (stating that the remedial purpose
of the system is to “provide compensation for an employee for all
work-connected injuries, regardless of questions of negligence
and proxinate cause” (internal quotation marks and citations
omitted)).

Six of the seven factors appear to weigh against
concluding that the sanction of a fine under HRS § 386-98 is
punitive. It cannot be said that Appellant has provided the
“clearest proof” that administrative penalties imposed pursuant
to HRS § 386-98(e) are criminal and punitive, despite the
legislature's expressed intent to the contrary. Therefore, we
reject Appellant's contention.”

XVIII.
Appellant argues that HRS § 386-98 is unconstitutional

inasmuch as the Department has “unbridled discretion to impose

% —tnasmuch a we conclude that HRS § 366-96 is not a penal statute,
kes intza, we need not reach Appellant's cub-argunents that “if the penalti
Ste deened Crininsi, the right to 2 jury trial is deened triggered"; that
fraudolent
jury tried:
With reasonable clarity the ect proscribed a
Judging guilt, of that the statute will be
in conjunction with Appellant's argunent 1(@) in the court eppeal

‘ach Appellant's reply argument 3a) in the

   

      
 
 

 

  

6s
 

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penalties without appropriate guidelines.” In support of this
assertion, Appellant appears to contend that he was denied due
process inasmuch as penalties were assessed even though he did
not receive any benefits to which he was not entitled. “the
basic elements of procedural due process of law require notice
and an opportunity to be heard at @ meaningful tine and in a
meaningful manner before governmental deprivation of a
significant property interest." Sandy Beach Def. Fund. v, city
Council, 70 Haw. 361, 378, 773 P.2d 250, 261 (1989) (citations
omitted). We have already rejected Appellant's assertion that he
was required to actually receive benefits in order to fall within
the penalty provisions of HRS § 386-98. Further, inaemuch as
Appellant took part in hearings before the Department and the
LIRAB, and insofar as pertinent to this argument he engaged in
court proceedings and filed several motions before the court
during the pendency'of this case, we conclude that Appellant was
not denied due process of law.
xIK.

Appellant also maintains that the police power of the
State of Hawai'i cannot criminalize or penalize conduct protected
under the First Amendment to the U.S. Constitution, namely free
speech, by statements he made at a hearing conducted by the

Department, primarily in response to questions by Ritz-Carlton

 

and Marriott's attorneys. According to Appellant “[i]f alleged

 

 

Set Appellant's argument (2) (b) in the court appesl
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a

smisrepresentation[s]’ based on self-advocacy are permitted, no
person can be free to make statements at (Department) hearings
under threat of criminal or administrative penalty,” and “an
enployer could easily ‘set-up’ such charges by questioning a pro
ge Claimant, to elicit inculpatory statements." Appellant
fails to cite to any case law or statute that would support his
contention that the First Amendment provides protection to a
party that makes misrepresentations to a court or administrative
agency under the mantle of “self-advocacy." Therefore, we
conclude that @ “nisrepresentation” before the Department is not
constitutionally protected by the First Amendment.“

Appellant also contends that “a person always has the
right to testify in his own defense,” and cites to the Fifth
Amendment to the U.S. Constitution, The Fifth Amendment states
that “Injo person . . . shall be compelled in any Criminal Case
to be a witness against himself{.]” (Emphasis added.) Because
Appellant does not provide any argument, it is unclear how the
Fifth Amendment supports Appellant’ s contention, especially
because Appellant has not been charged criminally, and has not
alleged that he was deprived of the right to testify. Therefore,
we reject Appellant’s assertion pertaining to the Fifth

Amendment.

“seg Appellant’s argument (1) (6) in the court appeal
+ gee Ritz-Carlton and Mareiott’s argument (3) in the adninistrative
appee

eo
   

 

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xx.

Appellant next asserts that Ritz-Carlton and Marriott
failed to prove the elements of civil fraud" under Hawai‘ law.®
As stated by Ritz-Carlton and Merrictt and the Special
Compensation Fund,‘ however, the instant case does not involve
civil fraud as defined by Hawai'i law. Appellant, nevertheless,
asserts that the language of HRS § 386-98(a) (8) incorporates the
elements of civil fraud. However, as indicated infra, HRS § 386-
98 (a) (8) does not require reliance or detrimental reliance by any

party, as Appellant contends, for a violation of its terms to

 

     

 

occur.

O eg, APPEllant, cites what appears to be Shoome vs Guccl An, Inc, 94
Hawas's 368, 386, 14.34 1049, 1067 (2000), (noting that “thie cours hes
long recogtized ‘that = party claining fraud must ectablish the following
elenents: (1) false representations were made by defendants, (2) wich

knowledge of their falsity (or without knowledge of their truth or falsity),
(G) in contenplation of plaintiff's reliance upen these falte representations,
and (4) plaintife aid rely upon then". (citations omitted) 17, dau e

union v. Keka, $4 Hawai'i 213, 230, 11 P-3d 1, 16 (2000) {stating thet
Nitjo constitute fraudulent inducement evtficient to invalidate the terms of &
contract, thee most be 1) 2 representation of  netersel fact, (2) made for
the purpose of inducing the other party £0 act, (3) known to be’ fall
reasonably believed true by the other party, and (4) upon whieh th
party relies and acts to (his or her) Gamage” (citations omitted) )y and

Mads, 101 F. Supp. 24 1515 (D. Hew. 1999) (atating thee “ander:

Hawaii Tews [tihe elenents of frauc include: (2) false representations mad
by the defendants (2) with knowledge of their falsity (or without knowledge of
their truth or falsity): (3) in contemplation of plaintiff's reliance upos
them: and (4) plaintiff's detrimental relience” (citation omitted) ]*

 

© Sgt Appellant’ s arguments (2), (2) (a), (2)(€)+ (24d), (2) (ely and
(2) in the adtinistrative appeal

 

Sige Ritz-Carlton and Marriott’ argument (4), and the Spectel
Compensation Fund’ s argument (2) (a) in the administrative appeal, Ritz
Cariton and Marriott also asserted in argunent (3) in the court appeel that
the instant case does not involve ceanon law or criminal travd.

 

 

Me decline to address Appellant's reply argunent 3(b) in the
adninistrative appeal insemueh as it wae raised for the first time in his
reply brief. Sea Jaonse, 110 Hawaii at 333 m-l4, 132 Pood at 124¢ molds gee

alse supra fort x1V.

 

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XXI.

 

Regarding the issue of the appropriate standard of
proof in the administrative hearing, Appellant asserts that Ritz-
carlton and Marriott were required to prove that he violated HRS
§ 386-98 by clear and convincing evidence.“ In response, Ritz-
Carlton and Marriott argue that “[s]ince HRS § 386-98 does not
specify another evidentiary standard, the preponderance of the
evidence standard applies” pursuant to HRS § 91-10(5) (Supp.
2005) .

HRS § 386-98 is silent as to the standard of proof
required. At the administrative hearing, the LIRAB rejected
Appellant's contention that the “clear and convincing evidence”
or “proof beyond a reasonable doubt” standards applied, and
determined that “[pJursuant to HRS § 91-10(5), . . . . the
correct standard of proof in a contested case hearing under [HRS
chapter 386] is preponderance of the evidence, unless the law
provides otherwise.” Applying the preponderance of the evidence
standard, the LIRAB concluded that Ritz-Carlton and Marriott “met
its burden of proof to show by a preponderance of the evidence
that [Appellant] violated HRS § 366-98(a)(8).” For the reasons
stated herein, we conclude that a violation of HRS § 386-98 must

be proved by clear and convincing evidence.

 

“appellant addresses the issue of burden of proof in his reply
gunent (2) in the court appeal, in his argument (2) (b) and in hie reply
argunent (4) in the administrative eppesl. Je i= addressed by Ritz-Carlton
and Marriott in argunent_ (4) (c] in the court appeal, and argument (6) in the
Sdninistrative appeal, This issue is addressed by the Special Cempensation
Ford in ergument (3) in the administrative appeal

6

 
 

‘s++70R PUBLICATION J WEST'S HANAI'T REPORTS AND PACIFIC REPORTER*

 

 

xxrt.

HRS § 91-10(5) of the Hawai'i Administrative Procedures
Act (HAPA) states that in contested cases, “Lelucept as otherwise
provided by law, the party initiating the proceeding shall have
the burden of proof, including the burden of producing evidence
as well as the burden of persuasion. The degree or quantum of
proof shall be preponderance of the evidence.” (Emphasis
added.)

‘The legislative history of HRS § 91-10 indicates that
in 1978, the legislature anended HAPA to provide that in
contested case hearings, “the party initiating the proceeding
shall have the burden of proof, including the burden of producing
evidence as well as the burden of persuasion.” Stand. Comm. Rep.
No. 682-78, in 1978 Senate Journal, at 1068. The legislature
further specified that “the degree of quantum of proof shall be a
preponderance of the evidence.” Id. However, the legislature
also added that this standard shall be applied only “le]xcept as
otherwise provided by law{.)” Id.

Prior to this amendment to HAPA, “in contested c

 

proceedings before the various State regulatory boards,
connissions, and agencies, it (was) not clear who ha[d) the
burden of proof and what the quantum of proof [was] required to
carry the burden.” Id. HAPA had no provision comparable to the
Federal Administrative Procedures Act which specified that “the
proponent of a rule or order has the burden of proof.” stand.
comm. Rep. No. 288-78, in 1978 House Journal, st 1817. “AS a

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i
result, the various bodies . . . adopted requirements that [were]

   

not uniform.” Stand. Comm. Rep. No. 682-78, in 1978 Senate
Journal, at 1068.

‘The legislature noted that “[d]ue to the absence of
such a provision it ha[d] been suggested in licensing cases that
the quantum of proof required is clear and convincing evidence, a
higher standard than by a preponderance.” Stand. Comm. Rep. No.
288-78, in 1978 House Journal, at 1517. Notably, the legislature
specified that “(t]he bill would addpt the common law standard es
established for other civil actions.” Stand. Comm. Rep. No. 268-
78, in 1978 House Journal, at 1517 (emphases added).

XXIII.

Under Hawai'i law, “clear and convincing” evidence is
“defined as an intermediate standard of proof oreater than a
preponderance of the evidence, but less than proof beyond a
reasonable doubt required in criminal cases.” Masaki v, Gen.
Motors Corp., 71 Haw. 1, 15, 780 P.2d 566, 574-75 (1989) (citing
Welton v. Gallagher, 2 Haw. App. 242, 245-46, 630 P.2d 1077, 1082
(1981); Bud Wolf Chevrolet, Inc, v, Robertson, 519 N.E.2d 135,
138 (Ind. 1998); E, Cleary, McCormick on Evidence, § 340, at 959-
60 (3d ed. 1984))? see alge Covle v, Compton, 85 Hawai'i 197, 940
P.24 404 (App. 1997). This standard requires “that degree of
proof which will preduce in the mind of the trier of fact a firm
belief or conviction ag to the allegations sought to be

established, and requires the existence of a fact be highly

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‘*APOR PUBLICATION IN WEST’ § HAWAI'I REPORTS AND PACIFIC REPORTE

 

 

probable.” Masaki, 71 Haw. at 15, 780 P.2d at 574-75 (citations
omitted) .

‘The “clear and convincing” standard “has been applied
to a wide variety of civil cases where for policy reasons the
courts require @ higher than ordinary degree of certitude before
making factual findings.” Id. at 15, 780 P.2d at 574 (quoting
Addington v. Texas, 441 U.S. 418, 424 (1979). This standard “is
typically used in civil cases involving allegations of fraud or
some other quasi-criminal wrongdoing by the defendant.” Id.
(quoting Addington, 441 U.S. at 424). In such cases, “the
interests at stake . . . are dened to be more substantial than
mere loss of money and sone jurisdictions accordingly reduce the
Fisk to the defendant of having his reputation tarnished
erroneously by increasing the plaintiff's burden of proof. Ida
(quoting Addington, 441 U.S, at 424).

“in keeping with these principles, Hawaii's appellate
courts have implemented the clear and convincing standard of

." Iddings, 62 Hawai'i at 14, 919

 

proof in a myriad of situation
P.2d at 276 (citing Carr v. Strode, 79 Hawai'i 475, 904 P.2d 499
State vw.

Miller, 79 Hawai" 194, 900 P.2d 770 (1995) (proof to establish

 

(1995) (proof to overcome presumption of paternity):

that criminal defendant is not a flight risk or danger to the
community); State vs Lopez, 78 Hawai'i 433, 896 P.24 889 (1995)
Galleon vy. Mivaai, 76 Hawai‘ 310,
876 P24 1278 (1994) (punitive damages); Maria v. Freitas, 73
Haw. 266, €32 P.2d 259 (1992) (constructive trust); Office of

 

(inevitable discovery rule)

R
 

'§ WWAT'E REPORTS AND PACIFIC REPORTER!

 

539, 777 P.24 720 (1989)

 

Disciplinary Council v. Rapp, 70 Hav.
(professional misconduct); Mehau v. Gannett Bac. Comp., 66 Haw.
133, 658 P.2d 312 (1983) (defamation); Hoodruff v. Keale, 64 Haw.
85, 637 F.2d 760 (1961) (termination of parental rights);

Boteilho v. Boteilho, $8 Haw. 40, S64 P.2d 144 (1977) (oral
contract for sale of real estate); Cresencia v. Kim, 10 Haw. App.

461, 878 P.2d 725 (1994) (fraud); Chan v. Chan, 7 Haw. App. 122,
748 P.2d 807 (1987) (civil contempt); Tar v. City and
of Honolulu, 2 Haw. App. 102, 626 P.2d 1175 (1981) (proof that

government official acted with malice)).

In Kekona v, Abastillas, this court held that the
Intermediate Court of Appeals gravely erred when it determined
that @ fraudulent transfer may be proved by a preponderance of
the evidence. No. 24051, 2006 WL 3020312, at *8 (Haw. Sept: 26,
2006). In reaching this holding, this court stated:

believe thet the higher protections afforded by the
far and convincing” standard of proof were necessary

ge a finding of liability for a fraudulent transfer
preduces the reputational harp that should not be inflicte
Ebcent the Sdegree of proof which will produce in the ming
Of the trier of fact a firm belief or conviction a6 to the
Sliegations sought to be established(.)”— (Masaki, 71 Ha
Gt ib, 780 Pe2d at 504-75 (citations omitted)]. Indesd the

 

 

   

 

    

 

sie notes di e
the with a s
‘suiminality.

Ids at *7 (emphases added).
Likewise, in this case, we conclude that “the higher
protections afforded by the ‘clear and convincing’ standard of

much ag a finding of liability for a

 

proof were necessary in
fraudulent [insurance act) produces the reputational harm that

should not be inflicted absent the ‘degree of proof which will

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produce in the mind of the trier of fact a firm belief or

conviction as to the allegations sought to be established(.]/"
‘Id. (quoting Masaki, 71 Haw. at 15, 780 P.2d at 574-75 (citations
omitted). Indeed, being held liable for fraudulent insurance
act for intentionally or knowingly acting so as to obtain workers
compensation benefits through fraud or deceit in violation of HRS

§ 386-98 “connotes dishonesty and effectively brands the liable

 

defendant with an imprimatur of quasi-criminality.” Id. We
hold, then, that a violation of BRS'§ 386-98, 2 fraudulent
insurance act, must be proved by clear and convincing evidence.
Accordingly, the LIRAB erred in applying the preponderance of the
evidence standard of proof under HRS § 91-10(5).

XXIV.

Ritz-Carlton and Marriott argue that a fraudulent
insurance act as defined by HRS § 386-98(a) (8) does not involve
common law fraud. With respect to fraud, this court has held
that “[t]he evidence must be clear and convincing to support a
finding of fraud.” Hawaii's Thousand Friends v, Anderson, 70
Haw. 276, 286, 768 P.2d 1293, 1301 (1989) (citation omitted). It

should be noted also that “this court has repeatedly required

 

proof by ‘clear and convincing evidence’ with respect to other
fraud-related claims.” Kekona, 2006 WL 3020312, at *8 (citing
Schefke v, Reliable Collection Agency, Ltd, 96 Hawai'i 408, 431,
32 P.3d 52, 75 (2001) (“fraud on the court under Rule 60(b) must
be established by clear and convincing evidence” (citation
omitted) ); Shoppe v. Guces Am., Inc., 94 Hawai'i 368, 386, 14

“
 

‘s++POR PUBLICATION IN WEST'S HAWAI'T REPORTS AND PACIFIC REFORTER'
P.3d 1049, 1067 (2000) (stating that a party alleging fraudulent

misrepresentation must establish its elements by “clear and”
convincing evidence”); Kana v. Harrington, 59 Haw. 652, 656-57,
587 P.2d 285, 289 (1978) (“In dealing with written contracts, the
standard of proof with respect to a showing of fraud is extremely
high. A written contract will be cancelled because of fraud only
in a ‘clear case and upon strong and convincing evidence.'*
(citation omitted.))). “This court has long recognized that a
party claiming fraud must establish the following elenents: (1)
false representations were made by defendant, (2) with knowledge
of their falsity (or without knowledge of their truth or
falsity), (3) in contenplation of plaintiff's reliance upon these
false representations, and (4) plaintiff did rely upon them.”
Shoppe, 94 Hawai'i at 386, 14 P.3d at 1067 (citations omitted);
see also Hawaii's Thousand Friends, 70 Haw. at 286, 769 P.2d at
1301.

Ae stated previously, under the plain language of HRS §
386-98 (a) (8) entitled “Eraud violations and penalties,” a
fraudulent insurance act includes (1) “acts or omissions
committed by any person[,]” (2) “who intentionally or knowingly
acts or omits to act[,]” (3) “so as to obtain benefits . . .
through fraud or deceit by” (4) “{m]isrepresenting or concealing
a material fact”:

A fraudulent ineurance act, under this chapter, shall
include acte or omissions committed by any peracn whe

Aptenticnally of knowingly acts oronite to act sos te
Sbtain-benetite Troueh fraud or deceit by doing the

Fetiowing

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ee
ej Miirepresenting or concealing # material factl.1
(Emphases added.)

Unlike common law fraud, HRS § 386-98(a) (8) does not on
its face require reliance or detrimental reliance by any party
for a violation of its terms.to occur. Rather, as discussed
previously, HRS § 386-98 includes within its definition of a
“fraudulent insurance act” “acts or omissions committed . . . so
as_to obtain benefits[,]” and does not require that an actual
benefit be obtained from any party.’ (Emphasis added.)

Therefore, HRS § 386-98 (a) (8) does not demand that either
reliance or detrimental reliance by another party be proven.

Nevertheless, this distinction does not dissuade us
from concluding that the “clear and convincing” standard must
apply in light of the interests at stake and the risk of
reputational harm to a defending party. See Masaki, 71 Haw. at
15, 780 P.2d at 574°(quoting Addington, 441 U.S. at 424); gee
also Kekona, 2006 Wi 3020312, at *7. As mentioned above, the
title of HRS § 386-98 reads “Exaud violations and penalties.”
(Emphasis added.) We have stated that “{w]here a statute is
ambiguous, its title may be referred to as an aid in construing
Honolulu Star Bulletin, Ltd. vs Burns, 50 Haw.
603, 606, 446 P.2d 171, 173 (2968) (citing Strathearn $.8, Co. v,
Dillon, 252 U.S. 348 (1920); Maguire v, Comm'r of Interna.

Revenue, 313 U.S. 1, 61 (1941)). Furthermore, a “fraudulent

 

the statute.

insurance act” under HRS § 386-98(a) includes “acts or omissions

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a

to obtain benefite . . / through fraud or deceit” by

 

doing any of acts enumerated in the statute.

‘The Hawai's legislature did not define the terms
sfraud” or “deceit” as used in HRS § 386-98 in HRS chapter 386.
therefore, these terms should be given their plain meaning. See
Singleton, 121 Hawai'i at 244, 140 P.3d at 1024 (stating that
because there was “no indication in the statute that the term
owner of record should be given a special interpretation other
than its common and general meaning . . . , under @ plain and
unambiguous reading of HRS § 261-89, real estate owned by the
government [fell] within the statute”). Where instructions $iven
to a jury did not include the legel definitions of “defraud” or
sdeceit,” this court has presuned that the jury applied the
cconnonly understood meaning of those terms, Roxas v. Marcos, 89
hawas"i 91, 148, 969 P.2d 1209, 1266 (1998) (citing ARS § 1-24
(3993) (the words of @ law are generally to be understood in
their most known and usual significetion(.1"))

Giving fraud its ordinary meaning, fraud is defined as
van instance or an act of trickery or deceit esplecially) when
involving micrepresentstion(.)” iebster's 7 wy Int!
Dictionary at 904. Additionally, the ordinary meaning of
sdeceit” is “the act or practice of deceiving (as by
falsification, concealment, or cheating) (.}” Idk at 564.
clearly, being held Liable under HRS § 386-98 (a) (8) for acting
veo a8 to obtain benefits” through “fraud or deceit” by
vnisrepresenting oF concealing a material fact” poses the sane

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harm to an individual's reputation as under conmon law fraud,
despite the absence of the reliance elenent. See Masaki, 71 Haw.
at 15, 780 P.2d at $74 (quoting Addington, 441 U.S. at 424); see
also Kekona, 2006 WL 3020312, at *7.

Ritz-Carlton and Marriott argue, however, that “[o]ther
Jurisdictions have determined that the burden of proof for
workers’ compensation fraud statutes is the preponderance of the
evidence based on the failure of the statutes to identify any

other specific standard,” and cite to Siostrand v. North Dakota

Workers Compensation Bureau, 649 N.W.2d 537 (N.D. 2002), and
Denuptiis v. Unocal Corp., 63 P.3d 272 (Alaska 2003), to support

ite contention. Because these cases do not comport with the law
and policies of this jurisdiction as to burdens of proof, they
are distinguishable.

In Denuptiis, the Suprene Court of Alaska considered
“whether the [state], Workers’ Compensation Board | (board)) erred
in applying a clear and convincing standard of proof to an
employer's claim for reimbursement of benefits based on fraud”
when the state workers’ compensation fraud statute was silent on
the standard of proof. 63 P.3d at 275. A subsection of the
state’s Administrative Procedure Act “call{ed) for a default
standard of proof by a preponderance of the evidence in cases
where ancther standard of proof is not set by applicable law[.]”
Id, at 277-78 (citation omitted). The court reasoned that
“[blased on the board's delegated rulemaking authority, the board
could adopt a rule that the standard of proof in reimbursement

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proceedings should be by clear and convincing evidencel,]” Put
because the board had not adopted such a rule, the default
standard of proof governed. Id, at 278. Therefore, the court
sconclude{d] that the board's application of the clear and
convincing standard . . . was not @ reasonable interpretation of
governing law." Ida

nowever, the court specified that “[a]ssuning that
applicable law! might xeasonably include a well-established

decision law principle as to the applicable standard of proof,

‘de at 278 n.24 (emphasis added). The court stated, “Zo the
ofthe evidence.” Id. at 278 n.14 (emphasis added) (citations
omitted). Conversely, as discussed supra, the case law of this
jurisdiction clearly requires that fraud cleims be proven by
clear and convincing evidence. Therefore, Denuntiis is
inapposite to this case.

similarly, in Siostrand, the Supreme Court of North
Dakota considered whether the Workers Compensation Bureau
(bureau) erred in using @ preponderence of the evidence standard

under the state's workers compensation fraud statute, rather than

 

a clear and convincing standard, when the state worke:
compensation fraud statute was silent on the burden of proof,
G49 N.W.2d at §47-49, North Dakota law also provided for a
defauit general standard of proof by a preponderance of the

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evidence. Id, at 547-48. The court noted that under North
Dakota law, in proving fraud, “the presumption, if any, is in
favor of innocence and the burden falls on him [or her] who
asserts fraud to establish it by proving every material elenent
constituting such fraud by a prevonderance of the evidence.” id.
at S48 (internal quotation marks and citation omitted) (emphasis
in original). Although the court recognized that it could
arguably supply an evidentiary burden of proof to the state fraud
statute because none was specified, it declined to do so, and
affirmed the bureau’s application of the preponderance of the
evidence standard. Id, at 549,

We observe that where there is no fraud statute in the
workers’ compensation scheme, courts have imposed a burden of
elear and convincing proof. In Namislo v, Azko, the Supreme
Court of Alabama stated that because “intentional tortious
conduct (isea, intentional fraud) committed beyond the bounds of
the enployer’s proper role is actionable, we deem it appropriate
to address the standard of proof to be applied in determining
whether a claim is due to be presented to a jury.” 671 so. 2d

1380, 1368 (Ala. 1995). The court, quoting from a previous

 

cision, stated that:

In order to ensure against borderline or frivolous claim
believe that @ plaintiff, in order to go te the Jury on &
glaim, must make «stronger showing than that required by the
“substantial evidence rule” as it applies to the esteblichment of
dary issues in regard to tort claine generally. Therefore we hold
Ehat in regard to'a fraud claim against an employers a fellow
eaployee, or an enployer’s insurer, in order to present s clein to
the jury, the plaintiff must present evidence thets if accepted
and believed by the jury, would qualify © cles 3

pusot of fraud.

 

 

 

 

 

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Sa

Id, at 1386-89 (internal quotation marks and citations omitted)
(emphasis added); see also Hobbs v. Alabama Power Co,, 775 So. 24
783, 787 (Ala. 2000) (holding “that in regard to a fraud claim
against an employer, a fellow employee, or an employer's insurer,
in order to present a claim to the jury, the plaintiff must
present evidence that, if accepted and believed by the jury,
would qualify as clear and convincing” (internal quotation marks
and citations omitted)); Kilbarger v. Anchor Hocking Glass Co.,
669 N.B.2d 08, 511 (Ohio Ct. App. 1995) (holding appellant was
not barred by collateral estoppel or res judicata because of a
jury verdict that appellant was not eligible to participate in
workers’ compensation because “(alt the first trial, appellant

was required to prove by # preponderance of the evidence that he

 

was injured” and in this case, “it will be appeliee’s burden of
ovina fraud b " ” (emphasis
added)), Similarly, in Light of the case law of this
jurisdiction and policy considerations discussed above, we
conclude that a fraudulent insurance act under HRS § 386-98 must
be proven by clear and convincing evidence.
xxv.

Appellant argues that the statements he made to Dr.
qoeller at the IMB “are protected by physician-patient privilege”
and “are in the nature of protected conduct recognized by lav."
however, statements made to @ physician during an IME are not
subject to the physician-patient privilege inasmuch as the
purpose of the IME is not to provide medical treatment to the

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patient but, rather, is conducted in the context of litigation.

See VanSickle v. MeHiuch, 430 N.W.2d 799, 801 (Mich. Ct. App.

1988) (holding that “the physician-patient privilege is

 

inapplicable when the medical examination or consultation is not
conducted for the purpose of rendering medical advice or care to
the person asserting the privilege”); Osborn v, Fabatz, 306+
N.W.2d 319, 322 (Mich. Ct. App. 1961) (stating that “[a]‘
communication between a person and a physician which is for the
purpose of a lawsuit, and not for treatment or advice as to
treatment, is not protected by the physician-patient privilege”
(citation omitted)). Additionally, Appellant does not argue that
he asserted a physician-patient privilege regarding statements
made during the IME and the record does not reflect that he did.
Appellant also fails to provide any discernible argument as to
how statements made to medical personnel “are in the nature of
Protected conduct recognized by law.” Accordingly, Appellant's
argument is without merit.

xxVI.

Appellant maintains that Dr. Toeller did not
appropriately use the AMA G th att erm
Ampaizment (Sth ed. 2001) (the Guides) and that the LIRAB should
have taken judicial notice of the Guides.‘ In support of this

contention, Appellant states that *

 

ince Mizoguchi and [Dr.

Egami} disclaimed being misled, [Ritz-Carlton and Marriott] had

 

 

‘This discussion relates to Appeliant’s arguments (3) and (4), and
response argument’ (7) made by Aits-carlton and Marriott in the adninistratioc
appeal

 

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ee
only [Dr. Toeller’s] report to rely on. That report should have

been evaluated with a critical eye since it purported to be proof
of fraud.” Appellant relies on a passage from the Guides which
states that “[i)t is not appropriate to question the individual’ s
integrity. If information from the individual is inconsistent
with what ds known about the medical condition, circumstances, or
written records, the physician should report and comment’ on the
inconsistencies.” Appellant also maintains that Dr. Toeller

conducted “an incomplete physical examination” because he “relied

 

on three tests only to reach his conclusions.”
We are not persuaded that Dr. Toeller’s reports
inappropriately questioned Appellant’s integrity or “purported to
be proof of fraud." Although Appellant does not specify which of
br. Toeller’s reports he is referring to or which parts thereof
he is relying on, we presume he is citing the part in which Dr.
‘Toeller concluded that Appellant had given a “purposely
factitious” exam in the May 9, 2001 IME report. Taken in the
context of his report, it would appear that Dr. Toeller was
commenting on the inconsistencies he observed while examining
Appellant. Dr. Toeller noted several inconsistencies between
Appellant's subjective complaints and physical reactions
throughout his May 9, 2001 report. Then, as noted previously, in
Light of those inconsistencies, he stated that “[t]he only
objective abnormalities on today’s examination were findings of a
purposely factitious examination.” His report of May 10, 2001
confirmed this finding. Taken in the context of the entire IME,

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we believe that this statement was @ permissible “comment on the
inconsistencies” that Dr. Toeller observed throughout the IME.
Nowhere in his reports does Dr. Toeller directly comment on
Appellant's “integrity,” nor does he assert that his reports are
proof of fraud. As such, Appellant’s argument is unpersuasive.

Appellant provides no argument as to why the LIRAB
should have taken judicial notice of the Guides, nor does he
assert that he requested that they do so. Appellant also
provides no discernible argunent in support of his position that
Dr. Toeller conducted “an incomplete physical examination.”
Accordingly, we disagree with his arguments.

xxvIT.

In the administrative appeal, Appellant contests
finding nos. 5, 6, 7, 8, 9 11, 13, 14, 15, and 16 in his points
of error on appeal. HRAP Rule 28(b) (4) requires that each point
of error “shall state (1) the alleged error conmitted by the
+ +s agencys (4) where in the record the alleged error
occurred; and (ii) where in the record the alleged error was
objected to or the manner in which the alleged error was brought
to the attention of the . . . agency.” HRAP 26 (b) (4) (c)
specifies further that “when the point involves a finding or
conclusion of the court or agency, a quotation of the finding or
conclusion urged as error” shall be included. Appellant has
properly set forth his points of error.

However, pursuant to HRAP 28(b) (7), the argument in the
opening brief must contain “the contentions of the appellant on

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the points presented and the reasons therefor, with citations to
the authorities, statutes and parts of the record relied on . «
points not argued may be deemed waived.” Appellant has failed to
provide any argument whatsoever and has not cited any
authorities, statutes or parts of the record to support his
challenge to the agency’s findings of fact and conclusions of
law, in violation of HRAP 28(b) (7). Accordingly, we deem,
Appellant's challenge to finding nos. 5, 6 » 7, 8, % 21, 13, 14
15, and 16 waived.
XXVIII.
pecouse ve renand for @ rehearing based on the burden
of clear and convincing evidence, we do not reach the arguments
of the parties as to credibility and the weight of the evidence
adduced at the administrative hearings.“
XIX.
Based on the foregoing, we affirm the court’s
ganuary 27, 2004 judgment. We vacate the LIRAB’s October 7, 2004
decision and order, and renand this case to the LIRAB for a
rehearing in accordance with this opinion.

on the brief:

 

 

Pescin Cb remlery ae t-

Herbert R. Takahashi,

Stanford #. Masui,

Danny J. Vasconcellos, and

Rebecca L. Covert (Takahashi,

Masui, Vasconcellos & Covert) Jane ¢. D6)

for Claiment-Appellant
Sione Tauese.

 

2) (e), (2) {e+ and (5) in the

“© Sos appellant's arguments (21 (0
ion Fund" e argument (2) (d)

adnin{stratsve appeal: See alga Special Comper
[nthe scmiaistrative eppeel~

 

as
 

"FOR PUBLICATION IN MEST’ S HAWAI'I REPCRES AND PACIFIC REPORTER

eS
Robert A. Chong and

J. Thomas Weber (Ayabe, Chong,

Nishimoto, Sia & Nakamura) for

Defendants~Appellees

Ritz-Carlton Kapalua and

Marriott Clains Services Corp.

 

Robyn M. Kuvabe and
Frances E. Lum (Deputy Attorneys
General) for Defendants-Appellees
Department of Labor and
Industrial Relations and Special
Compensation Fund.

ICURRENCE BY MOON, C.J. VIN:

Gre

eG

 

I concur in the result only.

ee