Title: UFE, Inc v. Labor and Industry Review Commission
Citation: N/A
Docket Number: 1994AP002794
State: Wisconsin
Issuer: Wisconsin Supreme Court
Date: May 22, 1996

No. 94-2794 
 
 
 
 
 
 
 
 
 
NOTICE 
This opinion is subject to further 
editing and modification.  The final 
version will appear in the bound 
volume of the official reports.   
 
 
 
 
No. 94-2794 
 
STATE OF WISCONSIN             :                IN SUPREME COURT 
                                                                   
 
 
UFE Incorporated and 
Pacific Indemnity Company, 
 
 
Plaintiffs-Appellants-Petitioners, 
 
 
v. 
 
Labor and Industry Review Commission 
and Jerry Huebner, 
 
 
Defendants-Respondents. 
 
 
FILED 
 
 
May 22, 1996 
 
 
 Marilyn L. Graves 
  Clerk of Supreme Court 
  
Madison, WI  
                                                                 
  
 
 
 
REVIEW of a decision of the Court of Appeals.    Affirmed.   
 
DONALD W. STEINMETZ, J.   The issue in this case is whether 
Wis. Stat. § 102.42(2)(a) (1993-94),
1 a section of the Worker's 
                     
     
1  Wis. Stat. § 102.42(2)(a) provides:   
 
 
(2) Choice of practitioner.   (a)  Where the employer 
has notice of an injury and its relationship to the 
employment the employer shall offer to the injured 
employe 
his 
or 
her 
choice 
of 
any 
physician, 
chiropractor, psychologist or podiatrist licensed to 
practice and practicing in this state for treatment of 
the injury.  By mutual agreement, the employe may have 
the choice of any qualified practitioner not licensed in 
this state.  In case of emergency, the employer may 
arrange for treatment without tendering a choice.  After 
the emergency has passed the employe shall be given his 
or her choice of attending practitioner at the earliest 
opportunity.  The employe has the right to a 2nd choice 
 
No. 94-2794 
 
 
 
2 
Compensation Act (the Act), requires UFE Incorporated (UFE) to pay 
the out-of-state health care expenses incurred by one of its 
employees without UFE's consent.  The court of appeals interpreted 
Wis. Stat. § 102.42(2)(a) as not requiring UFE's consent to the 
out-of-state health care expenses since the  expenses were 
incurred through a referral from a practitioner who was chosen in 
accordance with the statute.  See UFE Inc. v. LIRC, 193 Wis. 2d 
361, 369-70, 534 N.W.2d 627 (Ct. App. 1995).  We conclude that the 
statute is ambiguous and the interpretation of the Labor & 
Industry Review Commission (LIRC) should be given due deference.  
Since we agree that this interpretation is the most reasonable 
under the statute, and since it promotes the underlying purpose of 
the Act, we affirm the court of appeals. 
 
Jerry Huebner worked as a press operator for UFE.  After 13 
years of employment, Huebner developed work-related right and left 
wrist problems.  After obtaining medical treatment from several 
doctors, Huebner's family physician, Dr. Eugene Jonas, eventually 
referred him to the Mayo Clinic in Rochester, Minnesota, for 
further evaluation.  Huebner visited the Mayo Clinic on three 
(..continued) 
of attending practitioner on notice to the employer or 
its insurance carrier.  Any further choice shall be by 
mutual agreement.  Partners and clinics are deemed to be 
one practitioner.  Treatment by a practitioner on 
referral from another practitioner is deemed to be 
treatment by one practitioner. 
 
 
All future references to Wis. Stats. are to the 1993-94 
statutes.   
 
No. 94-2794 
 
 
 
3 
occasions and incurred medical expenses totalling $2,204.40.  
Although Huebner did not seek or obtain UFE's consent prior to 
obtaining treatment at the Mayo Clinic, he presented his medical 
expenses 
to 
UFE 
for 
payment. 
 
Relying 
on 
Wis. 
Stat. 
§ 102.42(2)(a), UFE informed Huebner that it would not pay the 
Mayo Clinic expenses because Huebner had failed to obtain its 
consent prior to undergoing medical treatment out-of-state.   
 
Huebner subsequently filed an application with the LIRC 
seeking payment of the Mayo Clinic medical expenses.  A hearing 
was held before an administrative law judge (ALJ) who concluded 
that UFE was responsible for the expenses.  The ALJ found that 
Wis. Stat. § 102.42(2)(a) only requires an employee to obtain 
consent from his or her employer before undergoing out-of-state 
medical care when the employee "chooses" to obtain the out-of-
state treatment.  Here, however, the ALJ reasoned, Huebner's 
Wisconsin licensed physician referred him to the Mayo Clinic; 
Huebner did not "choose" the out-of-state treatment. 
 
On review, LIRC agreed with the ALJ's conclusion and 
reasoning.  It stated: 
[T]he commission agrees with the administrative law judge 
that the applicant did not go to the Mayo Clinic by 
choice but because his family doctor referred him there, 
and that prior permission of the carrier was not 
necessary for the referral to the Mayo Clinic. 
UFE, pursuant to Wis. Stat. § 102.23, petitioned for judicial 
review of the commission's decision.  The St. Croix County Circuit 
Court, Judge C. A. Richards, affirmed LIRC's interpretation of the 
 
No. 94-2794 
 
 
 
4 
statute.  UFE then sought relief from the court of appeals 
claiming that LIRC's interpretation contravened the plain language 
of the statute.  The court of appeals affirmed and UFE and Pacific 
Indemnity Company, UFE's insurer, petitioned this court for 
review.   This 
case 
requires 
us 
to 
interpret 
Wis. 
Stat. 
§ 102.42(2)(a) of the Worker's Compensation Act.  The ultimate 
goal of statutory interpretation is to ascertain the intent of the 
legislature.  See Rolo v. Goers, 174 Wis. 2d 709, 715, 497 N.W.2d 
724, 726 (1993).  The first step of this process is to look at the 
language of the statute.  See In Interest of Jamie L., 172 Wis. 2d 
218, 225, 493 N.W.2d 56, 59 (1992).  If the plain meaning of the 
statute is clear, a court need not look to rules of statutory 
construction or other extrinsic aids.  State Historical Society v. 
Maple Bluff, 112 Wis. 2d 246, 252, 332 N.W.2d 792 (1983).  
Instead, a court should simply apply the clear meaning of the 
statute to the facts before it.  If, however, the statute is 
ambiguous, this court must look beyond the statute's language and 
examine the scope, history, context, subject matter and purpose of 
the statute.  See Rolo, 174 Wis. 2d at 715.  Furthermore, if an 
administrative agency has been charged with the statute's 
enforcement, 
a 
court 
may 
also 
look 
to 
the 
agency's 
interpretation.
2  See State ex rel. Parker v. Sullivan, 184 Wis. 
2d 668, 699, 517 N.W.2d 449 (1994).    
                     
     
2 The plain meaning of a statute takes precedence over all 
extrinsic sources and rules of construction, including agency 
interpretations.  For example, even if an agency interpretation is 
 
No. 94-2794 
 
 
 
5 
 
We first, therefore, turn to the statute itself to determine 
if it is ambiguous.  Wisconsin Statute § 102.42(2)(a) allows an 
employee 
to 
have 
"his 
or 
her 
choice 
of 
any 
physician, 
chiropractor, psychologist or podiatrist licensed to practice and 
practicing in this state for treatment of the injury."  If, 
however, 
the 
employee 
wishes 
to 
choose 
a 
non-Wisconsin 
practitioner, the employer must consent.  The last sentence of the 
subsection, however, reads:  "Treatment by a practitioner on 
referral from another practitioner is deemed to be treatment by 
one practitioner."  Wis. Stat. § 102.42(2)(a).    
 
It is unclear whether the requirement of employer consent 
applies to all out-of-state medical care or only the initial 
choice of practitioner made by the employee.  One reasonable 
interpretation is that if treatment by a second practitioner 
through a referral is characterized by the statute as "treatment" 
by the original practitioner, then only the original practitioner 
need be licensed to practice in Wisconsin.  UFE's position, 
however, that the statute expressly forbids all out-of-state 
treatment without mutual consent, is also reasonable.  
(..continued) 
accorded the highest level of deference by a court, great weight, 
it will not be upheld if the interpretation directly contravenes 
the clear meaning of the statute.  See Harnischfeger Corp. v. 
LIRC, 196 Wis. 2d 650, 661-62, 539 N.W.2d 98 (1995); State ex rel. 
Parker v. Sullivan, 184 Wis. 2d 668, 699-700, 517 N.W.2d 449 
(1994); Lisney v. LIRC, 171 Wis. 2d 499, 506, 493 N.W.2d 14 
(1992).   
 
No. 94-2794 
 
 
 
6 
 
The statute's ability to support two reasonable constructions 
creates an ambiguity which cannot be resolved through the language 
of the statute itself.  "[A] statutory provision is ambiguous if 
reasonable minds could differ as to its meaning."  Harnischfeger 
Corp. v. LIRC, 196 Wis. 2d 650, 662, 539 N.W.2d 98 (1995).  We 
therefore must turn to extrinsic sources and rules of statutory 
construction in order to determine the intent of the legislature 
in enacting Wis. Stat. § 102.42(2)(a). 
 
One such extrinsic source is the interpretation of the agency 
charged with enforcing the statute.  LIRC concluded that a 
referral by a practitioner in Wisconsin for out-of-state treatment 
remains "treatment" by the original Wisconsin practitioner.  
Furthermore, it reasoned that if an employee receives out-of-state 
treatment 
recommended 
by 
his 
or 
her 
initial 
Wisconsin 
practitioner, it is not because the employee has chosen such 
treatment, but because his or her physician has determined that 
such care is necessary for the employee's well-being.  Since 
Huebner's original physician was chosen pursuant to the statute, 
and since Huebner did not voluntarily choose to obtain the out-of-
state treatment, LIRC determined that he was not required to 
obtain approval from UFE. 
 
Although we are not bound by LIRC's interpretation, we do 
defer to agency interpretations in certain situations.  See 
Parker, 184 Wis. 2d at 699.  This court has identified three 
distinct levels of deference granted to agency decisions:  great 
 
No. 94-2794 
 
 
 
7 
weight deference, due weight deference and de novo review.  See 
Jicha v. DILHR, 169 Wis. 2d 284, 290, 485 N.W.2d 256 (1992).  
Which 
level 
is 
appropriate 
"depends 
on 
the 
comparative 
institutional capabilities and qualifications of the court and the 
administrative agency."  Parker, 184 Wis. 2d at 699.  Many times, 
as in this case, the parties to an action strongly disagree on the 
proper standard to be employed.  
 
LIRC 
contends 
that 
its 
interpretation 
of 
Wis. 
Stat. 
§ 102.42(2)(a) should be accorded great weight deference.  We 
disagree.  This court recently addressed great weight deference in 
detail in Harnischfeger.  In order for an agency interpretation to 
be accorded great weight deference, all four of the following 
requirements must be met:   
(1) the agency was charged by the legislature with the duty 
of 
administering 
the 
statute; 
(2) 
that 
the 
interpretation of the agency is one of long-standing; 
(3) 
that 
the 
agency 
employed 
its 
expertise 
or 
specialized knowledge in forming the interpretation; and 
(4) that the agency's interpretation will provide 
uniformity and consistency in the application of the 
statute.   
 
Harnischfeger, 196 Wis. 2d at 660.    
 
LIRC's experience with Wis. Stat. § 102.42(2)(a) clearly does 
not satisfy the requirements of the Harnischfeger test.  It has 
only issued three decisions regarding which out-of-state medical 
expenses incurred without the employer's consent are covered under 
the Act.  See AMC v. LIRC, No. 84-CV-5736 Dane County (June 10, 
1985), based on commission decision dated September 27, 1984; 
 
No. 94-2794 
 
 
 
8 
Allans Electric Inc. v. LIRC, No. 88-CV-1058 Wood County (Nov. 16, 
1989), based on a commission decision dated October 10, 1988; and 
 Olson v. Northern Engraving Corp., No. 90-053540 (Dec. 30, 1992). 
 Furthermore, only one of these, Olson, addressed the specific 
issue involved in this case.  Although LIRC's position in Olson is 
consistent with its position here, one holding hardly constitutes 
the type of expertise and experience needed by an agency for it to 
be afforded great weight deference by a court.  Cf. Harnischfeger, 
196 Wis. 2d at 660-61; Parker, 184 Wis. 2d at 700-03.   
   
UFE, on the other hand, argues that this court should apply a 
de novo standard of review to LIRC's interpretation and not grant 
LIRC any deference.  We also disagree with this position.  A de 
novo standard of review is only applicable when the issue before 
the agency is clearly one of first impression, Kelley Co., Inc. v. 
Marquardt, 172 Wis. 2d 234, 244-45, 493 N.W.2d 68, 73 (1992), or 
when an agency's position on an issue has been so inconsistent so 
as to provide no real guidance, Marten Transport, Ltd. v. DILHR, 
176 Wis. 2d 1012, 1018-19, 501 N.W.2d 391 (1993).   As LIRC's 
opinions in AMC, Allans Electric, and Olson demonstrate, this is 
not the first time that questions concerning out-of-state medical 
expenses under Wis. Stat. § 102.42(2) have come before it.  LIRC 
has applied and interpreted this subsection over the last seven 
years and has developed some level of expertise in determining 
what medical expenses an employer is responsible for.   
 
No. 94-2794 
 
 
 
9 
 
UFE, however, contends that LIRC has been inconsistent in its 
treatment of this issue and as such should not be accorded any 
deference.  UFE points to LIRC's decision in Allans Electric where 
it did not allow an employee to recover certain out-of-state 
medical expenses.  However, it is clear that Allans did not 
involve expenses incurred through a referral by a Wisconsin 
practitioner.  Instead, the employee in Allans went to a doctor 
located in Illinois not because of a referral, but solely of his 
own volition.  Clearly, then, because of Allans' factual 
dissimilarity, LIRC's position in Allans is not necessarily 
inconsistent with its position in Olson or this case.  As such, it 
would be inappropriate to apply a de novo standard of review to 
LIRC's interpretation.   
 
The remaining level of agency review is due weight deference. 
 Under the due weight standard, "a court need not defer to an 
agency's interpretation which, while reasonable, is not the 
interpretation 
which 
the 
court 
considers 
best 
and 
most 
reasonable."  Harnischfeger, 196 Wis. 2d at 660 n.4.  Due weight 
deference is appropriate when the agency has some experience in an 
area, but has not developed the expertise which necessarily places 
it in a better position to make judgments regarding the 
interpretation of the statute than a court.  The deference allowed 
an administrative agency under due weight is not so much based 
upon its knowledge or skill as it is on the fact that the 
legislature has charged the agency with the enforcement of the 
 
No. 94-2794 
 
 
 
10 
statute in question.  Since in such situations the agency has had 
at least one opportunity to analyze the issue and formulate a 
position, a court will not overturn a reasonable agency decision 
that comports with the purpose of the statute unless the court 
determines that there is a more reasonable interpretation 
available. 
 
This is very different than the deference granted to an 
agency under the great weight standard.  If great weight deference 
is appropriate, a court will uphold an agency's reasonable 
interpretation that is not contrary to the clear meaning of the 
statute, 
even 
if 
the 
court 
feels 
that 
an 
alternative 
interpretation is more reasonable.  Under due weight, however, the 
fact that the agency's interpretation is reasonable does not mean 
that its interpretation will necessarily be upheld.  If a court 
finds an alternative interpretation more reasonable, it need not 
adopt the agency's interpretation.  However, the court of appeals 
in this case, relying upon another court of appeals opinion, 
Carrion Corp. v. DOR, 179 Wis. 2d 254, 265, 507 N.W. 2d 356 (Ct. 
App. 1993), improperly concluded that under both great weight and 
due weight deference, an agency's interpretation will be upheld as 
long as it is reasonable.
3  See UFE, 193 Wis. 2d at 366.   
                     
     
3 The court of appeals in Carrion, 179 Wis. 2d 254, relied 
upon this court's holding in DILHR v. LIRC, 161 Wis. 2d 231, 245, 
467 N.W.2d 545 (1991), where we stated:  "'[W]e will affirm the 
[agency's] interpretation of the statute if it is reasonable, even 
if another conclusion would be equally reasonable.'"  See Carrion, 
179 Wis. 2d  at 265.  This holding is still a correct statement of 
law.  Under either due weight or great weight deference, an 
 
No. 94-2794 
 
 
 
11 
 
We find, as did the court of appeals, UFE, 193 Wis. 2d at 
367-68, that LIRC's interpretation should be granted due weight 
deference.  Although it has not developed the expertise and 
specialized knowledge necessary to be accorded great weight 
deference, this case is not the first time LIRC has interpreted 
subsection (2)(a) either.  LIRC has some experience in determining 
the proper medical expenses for which an employer is responsible. 
 Therefore, LIRC's interpretation of Wis. Stat. § 102.42(2)(a) 
should be upheld unless there is a more reasonable interpretation 
available.  UFE has not provided such an interpretation.   
 
Courts should also resolve statutory ambiguities so as to 
advance 
the 
legislature's 
basic 
purpose 
in 
enacting 
the 
legislation.  See Carkel, Inc. v. Lincoln Cir. Ct., 141 Wis. 2d 
257, 265-66, 414 N.W.2d 640 (1987).  The Worker's Compensation Act 
was created to ensure that employees who become injured or ill 
through their employment receive the prompt and comprehensive 
medical care that is necessary for their well-being.  See Nigbor 
v. DILHR, 120 Wis. 2d 375, 382, 355 N.W.2d 532 (1984); Cruz v. 
ILHR, 81 Wis. 2d 442, 449-50, 260 N.W.2d 692 (1978).  This court 
(..continued) 
equally reasonable interpretation of a statute should not be 
chosen over the agency's interpretation.  However, DILHR  does 
not, as the court of appeals thought in Carrion, eviscerate the 
important 
difference 
between 
great 
weight 
and 
due 
weight 
deference:  a more reasonable interpretation overcomes an agency's 
interpretation under due weight deference, while under great 
weight deference, a more reasonable interpretation will not 
overcome an agency's interpretation, as long as the agency's 
interpretation falls within a range of reasonableness.        
 
No. 94-2794 
 
 
 
12 
has repeatedly held that the Act should be construed liberally in 
order to fully effectuate this purpose.  See, e.g., West Allis 
School Dist. v. DILHR, 116 Wis. 2d 410, 421, 342 N.W.2d 415 
(1984); Nigbor, 120 Wis. 2d at 382.    
 
Of the two possible interpretations, LIRC's allows employees 
to more readily receive the treatment that they need.  It provides 
the employee's Wisconsin practitioner the option of referring the 
employee 
for 
out-of-state 
treatment 
if 
necessary. 
 
UFE's 
interpretation, however, requiring employer approval, creates a 
significant roadblock in an employee receiving such treatment.  It 
is clearly more beneficial for the employee to have the ultimate 
determination regarding out-of-state treatment in the hands of the 
employee's practitioner, rather than in the hands of the 
employee's employer.  This gives the employee's practitioner more 
flexibility when determining the appropriate treatment for the 
employee's injury without being concerned that the employer will 
refuse to consent to the suggested care.  Based on this reasoning, 
we conclude that LIRC's interpretation promotes the underlying 
purpose of the Act to a greater degree than UFE's.
4   
                     
     
4 UFE argues that there is legislative history which supports 
its interpretation of Wis. Stat. § 102.42(2)(a).  Specifically, it 
refers to various comments made by the Worker's Compensation 
Advisory Council when discussing out-of-state medical treatment.  
However, although these comments show that the commission wanted 
the initial choice of practitioner to be licensed in Wisconsin, no 
mention is made regarding out-of-state treatment based upon 
referral.  Furthermore, UFE asserts that the comments show the 
commission's 
concern 
that 
unlimited 
examinations 
would 
be 
performed outside the state at great expense to employers.  LIRC's 
interpretation, though, will in no way encourage unlimited out-of- 
 
No. 94-2794 
 
 
 
13 
 
This court sees no reason to discard LIRC's construction of 
the statute for an alternative interpretation.
5  Not only is 
LIRC's interpretation the most reasonable interpretation available 
under the language of Wis. Stat. § 102.42(2)(a), it is also the 
one which most clearly effectuates the purpose of the Act.  
  
By the Court.—The decision of the court of appeals is 
affirmed.     
(..continued) 
state treatment; the employer will only be responsible for 
treatment which is deemed necessary by the primary practitioner.  
It will be the exception rather than the rule that such treatment 
is required.  As the court of appeals noted, "[t]he suggestion 
that treating physicians will refer patients to expensive out-of-
state treatment centers without justification is contrary to the 
physicians' responsibilities."  UFE, 193 Wis. 2d at 371.   
     
5 In addition to its other arguments, UFE sets forth a number 
of public policy reasons why its interpretation should control 
rather than LIRC's.  Although these public policy arguments may or 
may not have merit, they shed little light on the intention of the 
legislature in drafting Wis. Stat. § 102.42(2)(a).  Furthermore, 
any merit they do have is not strong enough to overcome both the 
fact that LIRC's interpretation is entitled to due weight 
deference and the fact that LIRC's interpretation more readily 
effectuates the purpose of the Act. 
 
No. 94-2794 
 
 
 
 
SUPREME COURT OF WISCONSIN 
 
                                                              
 
Case No.: 
 
94-2794 
                                                              
 
Complete Title 
of Case: 
UFE Incorporated and Pacific Indemnity 
 
 
 
Company, 
 
 
 
 
Plaintiffs-Appellants-Petitioners, 
 
 
 
 
v. 
 
 
 
Labor and Industry Review Commission and 
 
 
 
Jerry Huebner, 
 
 
 
 
Defendants-Respondents. 
 
 
 
_________________________________________ 
 
 
 
 
 
 
REVIEW OF A DECISION OF THE COURT OF APPEALS 
 
 
 
Reported at:  193 Wis. 2d 361, 534 N.W.2d 627 
 
 
 
 
 
 
(Ct. App. 1995) 
 
 
 
 
 
 
PUBLISHED 
 
                                                              
 
Opinion Filed:  
May 22, 1996 
Submitted on Briefs: 
 
Oral Argument: 
April 2, 1996 
 
                                                              
 
Source of APPEAL 
 
COURT: 
Circuit 
 
COUNTY: 
St. Croix 
 
JUDGE: 
CONRAD A. RICHARDS 
 
                                                              
 
JUSTICES: 
 
 
Concurred: 
 
 
Dissented: 
 
 
Not Participating: 
 
                                                              
 
ATTORNEYS:  
For the plaintiffs-appellants-petitioners there 
were briefs by Bradley C. Lundeen, R. Michael Waterman and Mudge 
Porter Lundeen & Seguin, S.C., Hudson and oral argument by Bradley 
C. Lundeen. 
 
 
For the defendants-respondents the cause was argued by Lowell 
E. Nass, assistant attorney general, with whom on the brief was 
James E. Doyle, attorney general. 
 
 
No. 94-2794 
 
 
 
Amicus curiae brief was filed by Philip Lehner and Capwell 
and Berthelsen, Racine for the Wisconsin Manufacturers and 
Commerce and Civil Trial Counsel of Wisconsin.