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Ceres Marine Terminal v. Hinton (5th Cir. 2001)
CERES MARINE TERMINAL,
DAVID HINTON;
and DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, U.S. DEPARTMENT OF LABOR
This case arises out of a claim for disability benefits by David Hinton pursuant to the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. § 901-950 (1994). Ceres Marine Terminals ("Employer") petitions for review of an order in favor of claimant Hinton entered by the United States Department of Labor Benefits Review Board ("the Board"). We enforce the order.
The Employer disputed Hinton's eligibility for total permanent disability compensation. At trial before an Administrative Law Judge ("ALJ") on August 11, 1998, the Employer contended that Hinton was capable of returning to his former employment or of obtaining suitable alternative employment. During the hearing, the Employer and Hinton stipulated to the following:
[Counsel for the Employer]: Yes, your Honor, specifically on page four, Employer's Exhibit 13. We are withdrawing as our prior offer of evidence of suitable alternate employment the listing for the Thrifty Car Rental sales agent position. However, we - counsel and I have agreed to allow the remainder of the jobs to be before the Court for consideration. If you decide Mr. Hinton cannot return to this former employment as to whether or not these positions - which one of them would equate to his residual earning capacity.
On February 2, 1999, the Employer deposed its vocational expert. In a letter that same day to the ALJ, the Employer, for the first time, stated that it was requesting partial relief of its liability for Hinton's permanent disability benefits under 33 U.S.C. § 908(f)("§ 8(f) relief"). The Employer served the Solicitor of Labor with its request for § 8(f) relief on February 9, 1999.
After considering the evidence, the ALJ concluded that the employer failed to establish the existence of jobs that Hinton could secure or retain, considering his age, cognitive skills, education, and physical impairments. The ALJ also denied the Employer's request for § 8(f) relief, finding that the request was untimely. The Board affirmed the ALJ's decision in full.
"[F]indings of fact in the decision under review by the Board shall be conclusive if supported by substantial evidence in the record considered as a whole." 33 U.S.C. § 921(b)(3). On further review, the Court's "only function is to correct errors of law and to determine if the [Board] . . . deferred to the ALJ's fact-finding. . . ." Avondale Shipyards, Inc. v. Vinson, 623 F.2d 1117, 1119 n.1(5th Cir. 1980). Accordingly, we will not disturb an ALJ's factual findings unless they are unsupported by substantial evidence in the record. Director, OWCP v. Ingalls Shipbuilding, Inc. (Ladner), 125 F.3d 303, 305 (5th Cir. 1997).
C. Did Hinton's prior injury increase his disability under § 8(f)? Section 8(f) of the Longshore and Harbor Workers Compensation Act, 33 U.S.C. § 908(f), was enacted to alleviate potential employment discrimination against handicapped employees. American Bridge Div., U.S. Steel Corp. v. Director, OWCP, 679 F.2d 81, 82 n.3 (5th Cir. 1982). Under the Act's aggravation rule, if an employment injury aggravates, accelerates, exacerbates, contributes to, or combines with, a previous infirmity, disease or underlying condition, the employer is liable for compensation for, not just the disability resulting from the employment injury, but the employee's total resulting disability. Strachen Shipping Co. v. Nash, 782 F.2d 513, 517 (5th Cir. 1986). Where certain conditions are met, § 8(f) limits an employer's compensation liability, with any additional compensation being paid from the special fund established by § 44 of the Act. 33 U.S.C. § 944.
Section 8(f)(3) provides that any request for § 8(f) relief must be presented to the District Director; that failure to make such request shall be an absolute defense to special fund liability; and that the failure to timely file such a request will be excused if "the employer could not have reasonably anticipated the liability of the special fund prior to the issuance of a compensation order." 33 U.S.C. § 908(f)(3).(1) Prior to 1984, § 8(f) contained no explicit restrictions on the time for raising a claim for relief under its provisions. See Pub.L. No. 98-426, § 8(e)(5), 98 Stat. 1646 (amending 33 U.S.C. § 908(f) to add paragraph (f)(3)). In a case decided under the pre-1984 version of § 8(f), we nonetheless construed it as requiring the claim for special fund apportionment to be raised before or at the initial hearing, and precluding an employer from raising a § 8(f) claim for the first time on review of the ALJ's award of total disability benefits. American Bridge, 679 F.2d at 83. Under the pre-1984 version of the law, the Director of OWCP, who is charged with representing the special injury fund, was usually unrepresented at the hearing before the ALJ, and thus, assertions of entitlement to § 8(f) relief often went uncontradicted when raised for the first time at the hearing. See 51 Fed.Reg. 4270, 4277-78 (February 3, 1986)(reviewing history of actions under prior 33 U.S.C. § 908(f) and legislative history of new § 908(f)(3)). To remedy this problem, Congress amended § 8(f) in 1984 to require that entitlement to § 8(f) relief be raised earlier, during informal proceedings before the deputy commissioner. When the claim cannot be resolved without a formal hearing and is referred to an ALJ for a hearing, the implementing regulation provides:
The Employer raised his claim for § 8(f) relief for the first time when it moved for modification of the ALJ's initial decision, citing Hinton's preexisting back problems as the basis of a claim that it ought not bear the entire liability of Hinton's total permanent disability. The Employer contends that because the Director did not raise the affirmative defense of untimeliness defined by 20 C.F.R. § 702.321(b)(3), that affirmative defense was waived. Thus it was improper for the ALJ to base his denial of § 8(f) relief on untimeliness.
The Employer is correct that the affirmative defense of untimeliness set out in 20 C.F.R. § 702.321(b)(3) is inapplicable to this case. However, the Employer remained obligated to submit an application for § 8(f) relief at or before the initial hearing unless special circumstances excused its delay in raising the issue. See Universal Maritime Corp. v. Moore, 126 F.3d 256, 267 (4th Cir. 1997). The 1984 amendment to the Act was designed to advance to a point even earlier in the claim process the employer's obligation to raise entitlement to § 8(f) relief. Id. Although the regulations promulgated under the 1984 amendments were designed to preserve the availability of the relief in cases in which the issue of § 8(f) relief could not be anticipated during the period of informal claim consideration before the deputy commissioner - cases in which there was then no claim of permanency - in general, they do not provide for a bifurcated liability determination process. Id. The Director argues that the 1984 amendment and its regulations did not abrogate our previously-established requirement that special fund liability be raised timely unless excused by special circumstances. Absent clear congressional intent to the contrary, we afford deference to a reasonable construction of the Act by the Director because of his policy-making authority with regard to the Act. Chevron U.S.A., 467 U.S. at 842-45 & nn. 9, 11.
The ALJ held that "post-hearing requests for section 8(f) relief are generally denied as untimely where the employer could have requested such relief at the time of the initial hearing but failed to do so, absent compelling circumstances[,]" citing American Bridge, 679 F.2d at 82-83. After examining and rejecting any potential special circumstances that may have excused the Employer's delay in making its § 8(f) claim, the ALJ concluded that he was "constrained to find that the Employer's request for section 8(f) relief is untimely." Significantly, the ALJ did not rely on or make any reference to 20 C.F.R. § 720.321 timeliness.
The Employer makes no argument on appeal that circumstances excused it from presenting its § 8(f) claim prior to or at the hearing, nor does our review of the record reveal that any such circumstances existed.
We therefore conclude that the ALJ did not err in rejecting as untimely the Employer's § 8(f) claim, presented for the first time on motion for modification.
1. The District Director is a person "authorized by the Director to perform functions with respect to the processing and determination of claims for compensation under [the] Act." 20 C.F.R. § 701.301(a)(7). The regulation substitutes the term "district director" for the term "deputy commissioner" which is used in the Act. Id.