Court Opinion

ID: 9794025
Source: CourtListenerOpinion
Date Created: 2023-08-31 02:56:51.71499+00
Date Added: 2024-06-11T08:09:37.286642
License: Public Domain

WARREN, P. J.,
dissenting.
Because the majority opinion holds that the insurer should have complied with a procedural requirement that did not exist at the time of closure and that was, in fact, inconsistent with the law as it then existed, I dissent.
As the majority notes, before the legislature’s 1995 enactment of ORS 656.262(7)(b), an insurer was prohibited from issuing a current condition denial before closure of the claim. United Airlines, Inc. v. Brown, 127 Or App 253, 873 P2d 326, rev den 319 Or 572 (1994). Thus, in this case, had SAIF denied claimant’s current condition and ceased paying benefits before it closed the claim, it would have been subject to a penalty for unreasonable claim denial and termination of benefits.
The 1995 enactment of ORS 656.262(7) changed the law to permit an insurer to deny the compensability of a combined condition before claim closure, at the same time requiring the issuance of a written denial when the insurer becomes aware that the accepted injury is no longer the major contributing cause of the combined condition. As the majority correctly points out, we have held that the 1995 legislation is generally to be applied retroactively to cases pending on appeal, unless an express statutory exception exists. Volk v. America West Airlines, 135 Or App 565, 899 P2d 746 (1995). There is no statutory exception that would excuse SAIF’s compliance with the written denial requirement that did not exist at the time of closure.
Unlike the majority, I conclude that the analysis does not end there. The Supreme Court has held that courts will not apply a statutory provision if an application of the literal meaning would produce an unintended, absurd result or if the literal import of the words is so at variance with the apparent policy of the legislation as a whole as to bring about an unreasonable result. Johnson v. Star Machinery Co., 270 Or 694, 704, 530 P2d 53 (1974). We have held, further, that where retroactive application of an administrative rule is *578“unreasonable in its prejudice,” the rule should not be applied retroactively. Amfac, Inc. v. Garcia-Maciel, 98 Or App 88, 778 P2d 967 (1989).
In several of its decisions since the enactment of the 1995 legislation, the Workers’ Compensation Board has held that where retroactive application of the new law will defeat the general legislative intent by producing an absurd or unjust result that is clearly inconsistent with the purposes and policies of the workers’ compensation law, the statute will not be applied retroactively. See, e.g., Rick A. Webb, 47 Van Natta 1550 (1995); Ida M. Walker, 43 Van Natta 1402 (1991). The Board has recognized the unfairness of retroactively altering the rights and obligations of parties who have acted properly in reliance on the law in effect at the time of their actions, Webb, 47 Van Natta at 1551, and has held that substantial justice would not be served by requiring retroactive compliance with procedural requirements of the statute. Id.
In my view, the same rule applies in the context of ORS 656.262(7)(b). Retroactive application of the written denial requirement to SAIF in this case means imposition of an obligation that not only was not required but that was prohibited at the time of closure. I would hold that the legislature manifestly could not have intended that absurd and unjust result. Accordingly, I would reverse the Board’s decision and remand the case for reconsideration.
I dissent.