IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pablo Munoz, :

: Petitioner :

:

v. : No. 58 C.D. 2022

: Submitted: July 15, 2022 Jermacans Style, Inc. (Workers ’ : Compensation Appeal Board), :

: Respondent :

BEFORE: HONORABLE MICHAEL H. WOJCIK, Judge

HONORABLE CHRISTINE FIZZANO CANNON, Judge HONORABLE STACY WALLACE, Judge

OPINION NOT REPORTED

MEMORANDUM OPINION BY JUDGE WOJCIK FILED: May 19, 2023

Pablo Munoz (Claimant) petitions for r eview of the order of the

Workers ’ Compensation Appeal Board (Board) affirming the decision of a workers ’
compensation judge (WCJ), which denied and dismissed Claimant ’ s Petition to
Reinstate Compensation Benefits (Rei nstatement Petition) and a Petition for
Penalties (Penalty Petition) (collectively, Instant Petitions) filed against Jermacans
Style, Inc. (Employer). Claimant argue s that the WCJ erred in dismissing the Instant

P etitions on the basis of res judicata where Employer ’ s underlying Petition to
Terminate Compensation Benefits ( Termination Petition ) was improperly granted.
Employer asks this Court not only to affirm the Board ’ s order, but also to award it

counsel fees based on Claimant ’ s advancement of what Employer believes is a2

frivolous appeal. For the reasons that follow

, we affirm the Board ’ s order

, but
decline to award counsel fees to Employer

.

I. Background

The facts are not in dispute

, and this appeal only involves a question of

law

. On September 12, 2018, Claimant sustained a work

- related injury in the nature
of a left shoulder rotator cuff strain, which Employer accepted

. Employer filed a
Termination Petition seeking to terminate benefits following an independent medical

examination (IME) of Claimant. WCJ James Stapleton (WCJ Stapleton) held a
hearing on the Termination Petition

. WCJ Stapleton noted that, although Claimant

was served with both the Termination Petition and the hearing notice, Claimant did

not file an a nswer in opposition and did not appear either in person or via counsel to

the hearing or otherwise defend against the allegations

. At the hearing, WCJ
Stapleton accepted Employer ’ s medical report of the IME doctor

, which reflected

the doctor ’s opinion that Claimant was fully recovered from his work injury a s of

March 20, 2019 , without objection

. Bas ed on this evidence alone

, WCJ Stapleton
determined that Claimant had fully recovered from his work injur y effective March

20, 2019. Thus, b y decision dated May 17, 2019 , the WCJ granted the Termination

Petition

. Claimant did not file an appeal.

Thereafter, o n November 14, 2019, Claimant filed a counseled
reinstatement petition and a penalty petition ( Prior Petitions) alleg ing that his

benefits should be reinstated on the g rounds that the Termination Petition was
improperly granted and that the finding of termination was not supported by

substantial, competent evidence. Claimant further averred that Employer violated3

the Pennsylvania Workers ’ Compensation Act (Act) 1 b ased on the stoppage of

benefits

. The Prior Petitions were assigned to WCJ Terry Knox (WCJ Knox) for
consideration. By decision dated January 17, 2020, WCJ Knox denied the Prior
Petitions upon concluding that WC J Stapleton ’ s order terminating Claimant ’ s

benefits was final and binding on Claimant because it was not appealed

. 2 WCJ Knox

concluded that Claimant was barred by res judicata from asserting that the
Termination Petition was improperly granted based on the evidence present ed

. 3
Claimant appealed to the Board, which affirmed. On further appeal to this Court,
we quashed the appeal as untimely filed. See Munoz v. Jermacans Style, Inc.
(Workers ’ Compensation Appeal Board) (Pa. Cmwlth., No. 35 C.D. 2021, filed

March 1, 2021) ( Munoz I )

. Thereafter, o n March 2, 2021, Claimant filed the Instant Petitions

, alleging :

On May 17, 2019, [] [C] laimant ’ s workers ’ compensation

benefits were terminated by order of the [WCJ ] . The termination order was not supported by substantial

e vidence and is void ab initio on the basis of hearsay. The attorney for [Employer] never took the deposition of the IME doctor

. . . , and instead just submitted a report. A decision to terminate benefits cannot be based on hearsay evidence alone.

. . . C laimant requests that the order terminating his benefits be considered void ab initio and his benefits be reinstated as of May 17, 2019

, along with

1 Act of June 2, 1915, P.L. 736, as amended

, 77 P.S. §§1

- 1041.4, 2501

- 27 10

.

2 WCJ Knox advised Claimant that he could file an appeal nunc pro tunc with the Board.
See WCJ Knox Opinion, 1/17/2020, Finding of Fact (F.F.) No. 6. There is no indication in the record that Claimant ever filed a nunc pro tunc appeal.

3 WCJ Knox furthe r advised Claimant that he could file a reinstatement petition based on worsening of his condition subsequent to the termination. See WCJ Knox Opinion, 1/17/2020,
F.F. No. 6.4 penalties of fifty percent (50%), statutory interest [,] and attorney fees.

Though [] [C] laimant filed a prior petition seeking reinstatement of his workers ’ compensation benefits with penalties raising the issue of uncorroborated hearsay as insufficient to support a termination, both th e [WCJ] and the [Board] ignored the issue raised. Therefore, the re is no res judicata as the issue raised was never addressed by the Court. The [WCJ ] lacked jurisdiction to terminate [] [C] laimant ’ s benefits. Issues of jurisdiction can be raised at any time.

Certified Record (C.R.) at 6

- 7

. 4

WCJ Jeffrey Mills (WCJ Mills) held a hearing on the Instant Petitions

on March 23, 2021, wherein Employer interpose d a motion to dismiss the Instant

Petitions asserting res judicata. C.R. at 59. By order circulated on April 12, 2021,

WCJ Mills denied and dismissed the Instant Petitions based on res judicata

. WCJ

Mills explained that WCJ Stapleton ’ s order was a final judgment , which was not
appeal ed

, and that the principles of technical res judicata precluded Claimant from
attempting to relitigate the term ination of his benefits. Claimant appealed to the

Board, which affirmed. Claimant now petitions this Court for review. 5

II. Issues

Claimant contends that the WCJ erred by dismissing the Instant

Petitions based on technical res judicata because the underlying Termination Petition

4 Because the Certified Record was filed electronically and was not paginated, the page numbers referenced in this opinion reflect electronic pagination.

5 Our review is limited to determining whether the WCJ ’ s findings of fact were supported by substantial evidence, whether an error of law was committed, or whether constitutiona l rights were violated. Department of Transportation v. Workers ’ Compensation Appeal Board (Clippinger) , 38 A.3d 1037, 1042 n.3 (Pa. Cmwlth. 2011).5

was improperly granted

. Employer counters that res judicata precludes Claimant’s
attempt to relitigate matters finall y adjudicated

. Employer see ks counsel fees
pursuant to P ennsylvania Rule of Appellate Procedure 2744 , Pa. R.A.P. 2744 (Rule

2744)

.

III. Discussion A. Res Judicata
First, Claimant contends that the Instant Petitions are not barred by res
judicata. Claimant maintains that the underlying Termination Petition was
improperly granted because it was based solely on hearsay evidence and was not
supported by competent medical testimony. Claimant argues that WCJ S tapleton ’ s order granting the Termination Petition is not final or unassailable because it
implicates the issue of whether the WCJ had jurisdiction to terminate benefits in the
first place absent competent medical testimony.

In Weney v. Workers ’ Compensation Appeal Board (Mac Sprinkler
Systems, Inc.) , 960 A.2d 949

, 954 (P a. Cmwlth. 2008), this Court recounted the
criteria necessary to establish res judicata and collateral estoppel . We opined :

Initially, we note that technical res ju dicata and collateral estoppel are both encompassed within the parent doctrine of res judicata, which prevents the relitigation of claims and issues in subsequent proceedings.

Under the doctrine of technical res judicata, often referred to as claim prec lusion, when a final judgment on the merits exists, a future suit between the parties on the same cause of action is precluded. In order for technical res judicata to apply, there must be: (1) identity of the thing sued upon or for; (2) identity of the ca use of action; (3) identity of the persons and parties to the action; and (4) identity of the quality or capacity of the parties suing or sued. Technical res judicata may be applied to bar claims that were actually litigated as well as those matters that should have been6 litigated. Generally, causes of action are identical when the subject matter and the ultimate issues are the same in both the old and the new proceedings.

The doctrine of collateral estoppel, often referred to as issue preclusion, is desi gned to prevent litigation of an issue in a later action, despite the fact that the later action is based on a cause of action different from the one previously litigated. Collateral estoppel applies where:

(1) the issue decided in the prior case is ident ical to the one presented in the later case; (2) there was a final judgment on the merits; (3) the party against whom the doctrine is asserted was a party or in privity with the party in the prior case and had a full and fair opportunity to litigate the is sue; and (4) the determination in the prior proceeding was essential to the judgment.

Id. at 954. ( internal citations and quotations omitted ; emphasis in original )

.

Here , the reinstatement of Cla i mant ’ s benefits was addressed on two
prior occasions by the WCJ and Board

. Claimant filed the Prior Petition s seeking

reinstate ment of benefits and penalties on the basis that WCJ Stapleton ’ s order
terminating his benefits was not supported by substantial compe tent evidence

. WCJ

Knox denied the Prior Petitions, and the Board affirmed. Alth ough Claimant
appealed to this Court, the appeal was quashed as untimely. See Munoz I

. Claimant

then filed the Instant Petition s seeking the same relief on the same exact grounds.
WCJ Mills denied the Instant Petitions based on technical res judicata and the Board

affirmed.
Claimant argues that the doctrine of res judicata does not apply because

he did not have a full and fair o pportunity to actually litigate termination of benefits

or challenge the hearsay nature of the medical report in the Termination Petition
proceeding

. C ontrary to Claimant ’ s assertions, Claimant had the opportunity to7

litigate th ese issue s . However, by fa iling to answer the Termination Petition

, appear at the hearing on the Termination Petition , or appeal WCJ Stapleton ’ s order

, Claimant did not avail himself of this opportunity

. Res judicata applies not only to
claims that have already been litigated but also to claims that “ should have been
litigated

. ” Weney

, 960 A.2d at 954 (emphasis added). Claimant also fails to
recognize that the Instant Petition s seek the same relief on the same grounds as the

Prior Petitions , which were fully and finally adjudicated

. Upon review, WCJ Mills

did not err by dismissing the appeal based on the doctrine of res judicata

.

B. Counsel Fees
Turning to Employer ’ s request for counsel fees, Employer asserts it is

entitled to such fees because Claimant ’ s appeal is wholly frivolous and Claimant ’ s continued pursuit to challenge the termination of benefits despite final adjudications

is v exatious

. In support, Employer relies solely on Patel v. Workmen ’ s Compensation Appeal Board (Saquoit F i bers Company) , 520 A.2d 525 (Pa.
Cmwlth. 1987)

.

Rule 2744 provides that an appellate court may award attorneys ’ fees

“ if it determines that an appeal is frivolous or taken solely for delay or that the
conduct of the participant against whom costs are to be i mposed is dilatory, obdurate

or vexatious. ” Pa. R.A.P. 2744.

In Patel

, t he claimant filed three separate claim petitions on the same
claim and appealed each one to this Court

. This Court opined that “ [t]his appeal, the
third dealing with [the c] laiman t ’ s [] injury and the second to be dismissed due to
collateral estoppel and res judicata, is clearly wholly frivolous and constitutes patent
abuse of Claimant ’ s constitutional right to avail himself of the courts of this8

Commonwealth

. ” Patel , 520 A.2d at 526 (emphasis added)

. Accordingly, we awarded the employer costs under Pa. R.A.P. 2741. Patel , 520 A.2d at 526. In dicta,

we referenced Rule 2744 and suggested that an award of counsel fees to the
employer would also be appropriate based on the claim ant ’ s “ abuse of this Court ’ s appeals process

, ” but the Court declined to award such fees sua sponte

. Patel

, 520 A.2d at 526.

Later

, in Callahan v. Workmen ’ s Compensation Appeal Board
(Bethlehem Steel Corp.) , 571 A.2d 1108 (Pa. Cmwlth. 1990)

, we revisited Patel and
limited its application. In Callahan , the employer sought reimbursement of

attorneys ’ fees pursuant to Rule 2744 and Patel on the basis that the appeal was

frivolous. 571 A.2d at 1111 n.10. We emphasized that the discussion of Rule 2 744

in Patel was premised upon a “ patent abuse of the appellate process and not simply
on the basis of one frivolous petition for review

. ” Id. We opined t hat “ [t]he holding

in Patel is an extremely narrow one and is limited to the particular facts of that case. ”

Id. Noting the Act ’ s r emedial nature and humanitarian objectives, as well as the rule

of liberal construction, we declined to award counsel fees to the employer. Id. at

111 1

- 12.

In Phillips v. Workmen ’ s Compensation Appeal Board (Century Steel)

, 721 A.2d 1091 ( Pa. 1999)

, t he employer therein invoked Section 440 of the Act 6 and

Rule 2744 for reimbursement of counsel fees

. A divided Supreme Court foreclosed

the ability to assess counsel fees against the claimant under the Act. 7 It also declined

6 Added by the act of February 8, 1972, P.L. 25, as amended

, 77 P.S. §996

.

7 Section 440 of the Act provides for an award of counsel fees to a claimant where an employer contests its liability without “a reasonable basis for the contest.” 77 P.S. §996 . The Supreme Court held that Section 440 of the Act does not allow the award of counsel fees to an employer upon a finding that a claimant’s appeal was frivolous. Phillips , 721 A.2d at 1093

. (Footnote continued on next page...)9

to assess any counsel fees against the claimant under Rule 2744

, but it discussed the
possibility of such an award under Rule 2744 by comparing Callahan and Patel

. Phil lips , 721 A.2d at 1094

. Although t he Court signal ed its preference for Callahan

over Patel , it did not foreclose the possibility of sanctions under Rule 2744

. Id. ; see

Smith v. Workers ’ Compensation Appeal Board (Conso lidated Freightways, Inc.)

, 111 A.3d 235, 238 (Pa. Cmwlth. 2015).

Thereafter, this Court interpreted Phillips as leaving the door open for
appellate courts to impose sanctions under Rule 2744 in appropriate cases

. Smith

, 111 A.3d at 238

. In Smith , t he claimant had filed over 15 claim petitions regarding
the same injury, and again attempted to litigate the same claim that had been rejected
repeatedly for over a decade, and already had been deemed barred by res judicata
and collateral estoppel. Id. at 2 36. The case had been before this Court five times.

Id. Quoting from our earlier rejection of the claimant ’ s same frivolous appeal, this

Court noted that “ [p]ublic funds have been extensively expended as [the ] [ c]laimant
repeatedly attempts to re

- litiga te a case that was decided many years ago. Moreover,

[the ] [ c]laimant ’ s actions are, at the very least, unfair and unduly burdensome to

[the ] [ e]mployer, [which] has been forced to defend against each of these
unreasonable petitions. ” Id. In short, Clai mant ’ s actions amounted to a flagrant
abuse of process. Id. Thus, w e awarded costs and counsel fees incurred by employer

to defend against the “ obdurate and vexatious prosecution of a frivolous appeal

. ” Id.

at 238. Without such a sanction, there would be “ no way for our courts to curb the

sort of flagrant abuse of the system engaged in here. ” Id.

Rather, the “clear intent of Section 440 of the Act is to protect claimants from the costs of litigation, but not to provide comparable protec tion for employers.” Phillips , 721 A.2d at 1094. Thus, the Supreme Court found no basis upon which to award counsel fees to an employer. Id

.10 Here, Claimant ’ s conduct does not rise to the patent abuse of appellate

process involved in Smith or even Patel

. Althou gh Claimant filed two sets of
reinstatement and penalty petitions in which he impermissibly attack ed the
underlying grant of the Termination Petition

, this appeal is the first time in which

this Court has addressed the merits of Claimant ’ s case. See Munoz I

. Although we
agree that Claimant ’ s petition for review is frivolous, it falls short of a patent abuse
of process to warrant sanctions under Rule 2744

. See Phillips ; Smith

. Thus, we

decline to assess counsel fees against Claimant.

IV. Conclusi on Accordingly, we affirm the Board ’ s order affirming the WCJ ’ s order
denying Claimant ’ s Instant Petitions 8 but deny Employer ’ s request for counsel fees.

MICHAEL H. WOJCIK, Judge

Judge Wallace concurs in result only.

8 As the Board aptly noted in its opinion , res judicata does not preclude Claimant from filing a reinstatement petition that alleges a change in condition since the Termination Petition was granted. See National Fiberstock Corp. (Greater New York Mutual Insurance Co. v. Workers ’ Compensation Appeal Board (Grahl) , 955 A.2d 1057, 1062 (Pa. Cmwlth. 2008) (holding that a claimant may be entitled to reinstatement of benefits after a termination if the claimant proves that his disability has increased or recurred since the prior decision and that his phy sical condition has changed in some manner ). Claimant made n o such allegation n or submitted any evidence regarding a change in condition. Rather, Claimant merely sought to relitigate the underlying termination of benefits.IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Pablo Munoz, :

: Petitioner :

:

v. : No. 58 C.D. 2022

: Jermacans Style, Inc. (Workers ’ : Compensation Appeal Board), :

: Respondent :

O R D E R

AND NOW, this 19 th day of May , 20 2 3

, the order of the Workers ’
Compensation Appeal Board, dated December 22, 2021 , is AFFIRMED, and
Respondent Jermacans Style, Inc. ’ s request for counsel fees pursuant to

P ennsylvani a R ule of A ppellate P rocedure 2744 , Pa. R.A.P. 2744, is DENIED.

__________________________________ MICHAEL H. WOJCIK, Judge