566 April 26, 2023 No. 219

IN THE COURT OF APPEALS OF THE

STATE OF OREGON

In the Matter of the Compensation of 

Vern E. Giltner, Claimant.

Vern E. GILTNER,

Petitioner,

v.

SAIF CORPORATION 

and Dirt & Aggregate Interchange Inc.,

Respondents.

Workers’ Compensation Board

2001930; A176021

Argued and submitted October 25, 2022.

Jodie Anne Phillips Polich argued the cause for petitioner. Also on the reply brief was Law Offices of Jodie Anne 

Phillips Polich, P. C.

Michelle L. Shaffer argued the cause and filed the brief 

for respondents.

Before Shorr, Presiding Judge, and Mooney, Judge, and 

Pagán, Judge.

PAGÁN, J.

Affirmed.
Cite as 325 Or App 566 (2023) 567

PAGÁN, J.

Claimant seeks judicial review of an order of the 

Workers’ Compensation Board (board) determining that the 

SAIF Corporation (SAIF) was not required to make a lump 

sum payment of permanent partial disability (PPD) pursuant to ORS 656.230(1).1

 That statute addresses four circumstances when an insurer is not required to make a lump 

sum payment. We agree with SAIF that the board correctly 

interpreted the statute when it concluded that, even though 

claimant had waived his right to appeal the adequacy of the 

award, SAIF was not required to make a lump sum payment 

until expiration of the time to appeal the notice of closure. 

Accordingly, we affirm.

The relevant facts are procedural. In response to 

claimant’s workers’ compensation claim, SAIF mailed a 

notice of closure on March 20, 2020, awarding claimant PPD 

in the amount of $28,602.84. The notice stated that claimant was entitled to 34 percent loss of the whole person for 

impairment to his hearing. The date of injury was approximately seven years earlier, on April 10, 2013.

Under ORS 656.268(5)(e), the insurer has seven 

days from the date of the notice of closure to request reconsideration and the worker has 60 days to do so. SAIF did not 

request reconsideration of the award. Instead, on March 31, 

2020, SAIF issued a letter specifying the monthly payment 

schedule for the award and enclosing the first payment. On 

April 6, claimant applied for approval of a lump sum payment, and he waived his right to appeal the adequacy of the 

award. On April 8, SAIF denied the request, because the 

award had not become final by operation of law. On April 14, 

1 ORS 656.230 provides:

“(1) When a worker has been awarded compensation for permanent partial disability, and the worker requests payment of all or part of the award in 

a lump sum payment, the insurer shall make the payment requested unless 

the:

“(a) Worker has not waived the right to appeal the adequacy of the award;

“(b) Award has not become final by operation of law;

“(c) Payment of compensation has been stayed pending a request for 

hearing or review under ORS 656.313; or

“(d) Worker is enrolled and actively engaged in training according to 

rules adopted pursuant to ORS 656.340 and 656.726.”
568 Giltner v. SAIF

claimant requested a hearing on SAIF’s denial of his request 

for a lump sum payment. SAIF made a second monthly payment around the end of April and paid the remainder of 

claimant’s award in full on May 20, the sixty-first day after 

the notice of closure.

After a hearing on SAIF’s denial of claimant’s 

request for a lump sum payment, an administrative law 

judge (ALJ) decided in claimant’s favor. Interpreting and 

applying ORS 656.230(1) and OAR 436-060-0060(1),2 the 

ALJ determined that when claimant waived his right to 

appeal the adequacy of the award, and once SAIF’s sevenday window to request reconsideration had expired, the 

notice of closure became final by operation of law. According 

to the ALJ, “final by operation of law” meant

“the expiration of both parties’ rights to appeal—which 

could be accomplished by the passage of sixty days, or the 

passage of seven days coupled with claimant’s waiver of 

his right to challenge the adequacy of the award. SAIF’s 

refusal to pay claimant’s permanent disability as a lump 

sum until May 20, 2020, forty-four days after SAIF received 

claimant’s request, was unreasonable.”

The ALJ assessed a 25 percent penalty against SAIF and 

awarded claimant $4,797 in attorney fees.

SAIF appealed the ALJ’s order. The board reversed. 

Interpreting ORS 656.230(1), the board determined that 

claimant’s waiver of his right to appeal the adequacy of the 

award did not automatically render the award final by operation of law, because “SAIF could have validly rescinded 

its closure notice and reclosed the claim, pursuant to OAR 

436-030-0023,” and claimant “could still request reconsideration and allege that his claim was prematurely closed, a 

2 OAR 436-060-0060(1) provides, in part:

“The insurer may only deny the request for lump sum payment if any of 

the following apply:

“(a) The worker has not waived the right to appeal the adequacy of the 

award;

“(b) The award has not become final by operation of law;

“(c) The payment of compensation has been stayed pending a request for 

hearing or review under ORS 656.313; or

“(d) The worker is enrolled and actively engaged in an authorized training plan under OAR 436-120.”
Cite as 325 Or App 566 (2023) 569

finding which could result in an order rescinding the Notice 

of Closure and its permanent disability award.” Under 

those circumstances, the board determined that SAIF was 

not required to immediately make the lump sum payment. 

The board reversed the penalty and attorney fee award. 

Claimant now seeks our review of the board’s order.

“We review the board’s statutory interpretation for 

errors of law.” Baker v. Liberty Northwest Ins. Corp., 257 Or 

App 205, 210, 305 P3d 139, rev den, 354 Or 597 (2013) (citing 

ORS 183.482(8)(a)(B)). We attempt to discern the meaning 

of the statute intended by the legislature, examining the 

text in context and any relevant legislative history. State 

v. Gaines, 346 Or 160, 171-72, 206 P3d 1042 (2009). When 

interpreting the board’s administrative rules, “[w]e will 

defer to the board’s plausible interpretation of its own rule, 

including an interpretation made in the course of applying 

the rule, if it is not inconsistent with the text of the rule, 

its context, or any other source of law.” McGuire v. SAIF, 

317 Or App 629, 634-35, 507 P3d 317, rev den, 370 Or 197 

(2022).

ORS 656.230(1), the statute at issue, states that the 

insurer shall make a requested lump sum payment of PPD 

“unless” certain circumstances apply. The related administrative code provision, OAR 436-060-0060(1), provides that 

the insurer may deny a request for a lump sum payment of 

PPD “if any” of those same four conditions applies. The conditions include when the worker “has not waived the right 

to appeal the adequacy of the award,” and when the award 

“has not become final by operation of law.” ORS 656.230

(1)(a), (b); OAR 436-060-0060(1)(a), (b).

On review, claimant argues that the board erred in 

interpreting and applying ORS 656.230(1) and OAR 436-

060-0060(1). He argues that when he waived his right to 

appeal the adequacy of the award, he “met the requirement” of ORS 656.230(1)(a). Relying on Cayton v. Safelite 

Glass Corp., 231 Or App 644, 220 P3d 1190 (2009), claimant 

argues that his waiver of the right to appeal the adequacy 

of the award was sufficient to trigger SAIF’s obligation to 

make a lump sum payment. SAIF argues that Cayton is 

distinguishable, because it interpreted an earlier version 
570 Giltner v. SAIF

of the statute, ORS 656.230(1) (2005), which was amended 

by Oregon Laws 2007, chapter 270, section 1. In addition, 

SAIF argues that it makes little sense to immediately make 

a lump sum payment, because waiver of a worker’s right to 

appeal the amount of the award does not waive the worker’s right to challenge other aspects of the notice of closure 

within 60 days.

We agree with SAIF. In Cayton, 231 Or App at 646, 

we interpreted ORS 656.230(1) (2005), which did not list 

exceptions to the requirement to make a lump sum payment 

of PPD.3 We construed the statutory phrase “waiver of the 

right to appeal its adequacy,” and we determined that only 

the claimant, not the insurer, could challenge an award’s 

adequacy or amount. Id. at 649-50. As a result, “the claimant’s waiver of his or her right to seek an increase in the 

amount awarded” was sufficient to trigger the insurer’s obligation to make a lump sum payment. Id. at 651.

The current structure of the statute is significantly different. It provides that the insurer must make the 

requested lump sum payment, “unless” paragraphs (a) to 

(d) apply, which indicates that they state exceptions to the 

requirement. ORS 656.230(1); see Canales-Robles v. Laney, 

314 Or App 413, 422, 498 P3d 343 (2021) (“By its use of the 

word ‘unless,’ the statute creates an exception to the requirement * * *.”). The four exceptions are stated in the disjunctive, which means that if any one of them applies, then the 

requirement does not. See Viking Industries v. Gilliam, 118 

Or App 183, 185, 846 P2d 1207, rev den, 316 Or 529 (1993) 

(When statutory provisions articulating exceptions to a 

requirement are stated in the disjunctive, then “[a]ny one 

of them provides an adequate basis for” concluding that the 

requirement does not apply.).

3 ORS 656.230(1) (2005) provided, in part:

“Where a worker has been awarded compensation for permanent partial 

disability, and the award has become final by operation of law or waiver of the 

right to appeal its adequacy, the insurer shall upon the worker’s application 

pay all or part of the remaining unpaid award to the worker in a lump sum, 

unless the insurer disagrees with payment, in which case the insurer, within 

14 days, will refer the matter to the Director of the Department of Consumer 

and Business Services to determine whether all or part of the lump sum 

should be paid.”
Cite as 325 Or App 566 (2023) 571

The first exception to the requirement to make a 

lump sum payment applies when a worker has not waived 

the right to appeal the adequacy of the award, and the second exception applies when the award “has not become final 

by operation of law.” ORS 656.230(1)(a), (b). “Operation of 

law” refers to “[t]he means by which a right or a liability is 

created for a party regardless of the party’s actual intent.” 

Black’s Law Dictionary 1124 (8th ed 2004).4 An insurer’s 

request for reconsideration “must be made within seven days 

of the date of the notice of closure,” and a worker’s request 

“must be made within 60 days of the date of the notice of closure.” ORS 656.268(5)(e). Thus, an award of PPD in a notice 

of closure generally becomes final by operation of law “60 

days after its issuance.” SAIF v. Coburn, 159 Or App 413, 

415, 977 P2d 412 (1999).

Here, the award of PPD, which appeared in the 

notice of closure dated March 20, 2020, had not become final 

by operation of law on April 6, when claimant applied for 

approval of a lump sum payment. Considering the text of 

the statute in context, it supports the board’s conclusion 

that the second exception applied, and that SAIF was not 

required to immediately make the lump sum payment. See 

Gaines, 346 Or at 171 (when interpreting a statute, we look 

first to the statute’s words in context).

In arguing otherwise, claimant contends that we 

can rely on Cayton’s interpretation of the earlier version 

of the statute, because the legislative history of House Bill 

(HB) 2218 (2007), the bill that resulted in the 2007 amendments to ORS 656.230, shows that it was merely a “regulatory streamlining bill,” and that its “sole purpose” was 

to eliminate the director of the Workers’ Compensation 

Division from the lump sum approval process. Therefore, 

according to claimant, the intent of the statute remained 

the same despite its restructuring. Claimant relies on the 

testimony of John Shilts, a former director of the Workers’ 

Compensation Division, from the first public hearing on the 

bill.

4 The phrase “by operation of law” is not defined in ORS 656.005, the statute 

that provides definitions that govern the Workers’ Compensation Law. Nor is it 

defined in Webster’s Third New Int’l Dictionary (unabridged ed 2002).
572 Giltner v. SAIF

We are not persuaded by claimant’s argument. 

Considering Shilts’ testimony as a whole, it actually provides support for the board’s conclusion that SAIF was not 

required to immediately make the lump sum payment. 

Shilts testified that the bill “consolidates into one section of 

the statute the law * * * identifying those four times when 

an insurer can deny a lump sum permanent partial disability award and it removes the director from the ** * process of automatically reviewing all denied lump sum payments.” Tape Recording, House Committee on Business & 

Labor, HB 2218, Jan 26, 2007, Tape 10, Side A (statement 

of John Shilts). At a later public hearing, Shilts stated that 

the insurer can deny the lump sum payment “for any of four 

reasons allowed by the statute.” Audio Recording, Senate 

Committee on Commerce, HB 2218, May 7, 2007, at 0:12:30 

(comments of John Shilts), https://olis.oregonlegislature.gov 

(accessed Apr 9, 2023). Thus, Shilts’ testimony supports the 

plain meaning of ORS 656.230(1), which indicates that if 

any one of the four exceptions apply, then the insurer is not 

required to make a lump sum payment. Here, SAIF was 

not required to immediately make a lump sum payment on 

April 6, 2020, because the award of PPD had not become 

final by operation of law.

In this case, the ALJ ruled in claimant’s favor based 

on the ALJ’s flawed understanding that the award became 

“final by operation of law” when the claimant waived his 

right to appeal the adequacy of the award “coupled with” the 

expiration of the insurer’s right to request reconsideration, 

which occurred seven days after the date of the notice of closure. However, a worker can challenge the notice of closure 

in ways other than by appealing the adequacy or amount of 

the award. For example, a worker can object to a notice of 

closure by arguing that “the notice of closure was premature 

and should be rescinded.” Duffour v. Portland Community 

College, 283 Or App 680, 682, 389 P3d 1162 (2017). Because 

a worker can do so, it makes sense to conclude that an award 

of PPD is not final by operation of law until 60 days after the 

notice of closure, even when the worker waives the right to 

appeal the adequacy of the award.

“As a general rule, we assume that the legislature 

did not intend any portion of a statute to be meaningless 
Cite as 325 Or App 566 (2023) 573

surplusage.” Cayton, 231 Or App at 650. Claimant also 

argues that if ORS 656.230(1)(a) does not apply when a 

worker waives the right to appeal the adequacy of the 

award, and after the insurer’s seven-day window to seek 

reconsideration expires, then it never applies, and it is rendered “meaningless surplusage.”

We conclude otherwise. In Landriscina v. RaygoWagner, 53 Or App 558, 563-65, 632 P2d 1281 (1981), when 

interpreting ORS 656.304,5 we determined that a worker 

who requested and received a lump sum payment of an 

award did not knowingly waive his right to seek reconsideration of the award. We arrived at that conclusion even 

though the worker’s application form contained a warning 

about the waiver consequences of accepting a lump sum 

payment. Id. at 561. Although those circumstances are not 

likely to be common, Landriscina suggests that there can 

be instances when a worker requests a lump sum payment 

of PPD but does not waive the right to appeal the adequacy 

of the award. ORS 656.230(1)(a) addresses those circumstances. As a result, even if the exceptions in paragraphs (a) 

and (b) overlap, the first exception is not meaningless surplusage.6

 We affirm the board’s order reversing the ALJ’s 

order.

Affirmed.

5 ORS 656.304 provides, in part, that “[a] claimant may accept and cash any 

check given in payment of any award or compensation without affecting the right 

to a hearing, except that the right of hearing on any award shall be waived by 

acceptance of a lump sum award by a claimant where such lump sum award was 

granted as a result of the claimant’s own request under ORS 656.230.”

6 Claimant complains that there could never be “a situation where the worker’s waiver of the adequacy of the award would allow them to receive a lump sum 

payment” before expiration of the 60 days, but that result is simply a function of 

the fact that ORS 656.230(1) articulates exceptions to the requirement to make a 

lump sum payment. It is also consistent with OAR 436-060-0060(1), which articulates four circumstances when an insurer can deny a request for a lump sum 

payment.