Cloutier-Hennigar v. Maine Workers' Comp. Bd.

STATE OF MAINE SUPERIOR COURT

CUMBERLAND) ss. CIVIL ACTION

DOCKET NO. ee

EC —Cupr Siag ’

LEA CLOUTIER-HENNIGAR, oe REC

Petitioner “2 vat ct A Ob]

vo ORDER ON 80C APPEAL

DONALD L CARBRECHT

j oad f

MAINE WORKERS’ COMPENSATION LAW LISRARY

BOARD,

Respondents. JUN 2 2005

Petitioner appeals from the decision of the Workers’ Compensation Board Abuse

Investigation Unit to impose a penalty of $1,000 and order repayment of benefits

received from 1992 through November 27, 1996.

FACTUAL BACKGROUND

From 1983 until November 11, 1987, Petitioner worked as a waitress for

Sheraton Tara Hotel (Sheraton), when she suffered a work-related injury compensable

under the Maine State Workers’ Compensation Act, then 39 MRS.A. §§ 1 - 195 (now

39-A M.R.S.A. § 101 — 909) (the Act). Pursuant to a 1989 decree, Petitioner was awarded

partial (15%) disability. R. at 12-13. Before and after the injury, Petitioner continued to

work for her second employer Maco Management Company. In June of 1992,

Petitioner began to work for the Mariner’s Church Banquet Center as an on-call

banquet waitress. R. at 212.

In 1995, Sheraton filed a Petition for Review with the Workers’ Compensation

Board (the Board) seeking: 1) a grant of the Petition for Review and an order that

weekly benefits cease; 2) a finding of a violation of 39 MRS.A. § 106(1) and 39-A

M.R.S.A. § 308(1); 3) a grant of forfeiture of benefits for failure to accept reinstatement

to suitable work; and 4) an order of repayment of compensation received by a violation

of the Act, fraud, or intentional misrepresentation, pursuant to 39 M.RS.A. § 66-A,

§218(5) and 39-A M.R.S.A. § 360(2). R. at 82.

On November 27, 1996, the Board found no indication that Petitioner was

notified of her duty to report her earnings to Sheraton, as required by 39-A M.RS.A. §

308(1) (1993). R. at 69. Absent that notice, the Board found that Petitioner could not be

held to have violated the reporting requirements of 39-A M.R.S.A. § 308(1). Id. The

Hearing Officer granted Sheraton’s petition to terminate compensation because

Petitioner’s new wages were greater than her old wages. R. at 70. All other claims of the

Sheraton were denied. Id. Specifically, the Hearing Officer determined that “[s]ection

360(2) provides possible remedies for the present employer/insurer, but . . . is not

within this hearing officer’s jurisdiction.” R. at 69. Section 360(2) provides for civil

penalties and repayment for “any willful violation of this Act, fraud, or intentional

misrepresentation. 39-A M.R.S.A. § 360(2); see also R. at 69. The Employer requested

Findings of Fact and Conclusions of Law, which the Hearing Officer decided were

unnecessary and left the decision unchanged. R. at 71-72.

The Board’s Abuse Investigation Unit (AIU), with which Sheraton filed a Petition

for Penalties simultaneously with the Petition for Review, disagreed with the Board

Hearing Officer, and on July 7, 2002, found Petitioner’s failure to report her earnings

constituted a willful violation or fraud pursuant to 39 M.R.S.A. §§ 106(3), 113(2). R. at

586-87.’ The AIU found Petitioner’s claim that she was unaware of the duty to report

“unpersuasive and incredible”; it also determined that she intentionally concealed her

return to work. R. at 585. The Board’s Executive Director, writing for the AIU,

' The AIU is an adnunistrative unit of the Board, which raises the issue that there exist two

decisions from the “Board,” based on identical facts, with seemingly different legal conclusions.

However, only the AIU decision is properly before the court.

2

determined that § 106(3) contained a requirement for the Board to notify the employee

of her duty to report.’

The AIU concluded in the alternative that if 39-A M.RS.A. § 308(1) is deemed

applicable, then “compliance by the Board with the language directing the Board to

notify employees of the duty to report returns to work, is not a pre-requisite to relief

before the Abuse Unit.” R. at 587. The AIU also concluded that the statutory notice

was fulfilled by the Petitioner’s independent knowledge of her duty to report.

Accordingly, the AIU assessed a $1,000 civil penalty against Petitioner and ordered the

repayment of all benefits received for incapacity between her return to work at

Mariner’s Church Banquet Center and the Board’s decree of November 27, 1996.

DISCUSSION

Pursuant to a Rule 80C appeal, the Commission's decision is reviewed “directly

for abuse of discretion, errors of law, or findings not supported by the evidence."

Centamore v. Dep't of Human Serv., 664 A.2d 369, 370-71 (Me.1995). An administrative

decision will only be reversed or modified if the findings, inferences, or conclusions are:

“(1) In violation of constitutional or statutory provisions; (2) In excess of the statutory

authority of the agency; (3) Made upon unlawful procedure; (4) Affected by bias or

error of law; (5) Unsupported by substantial evidence on the whole record; or (6)

Arbitrary or capricious or characterized by abuse of discretion.” Hale-Rice v. Maine

State Retirement Sys., 1997 ME 64, [ 8, 691 A.2d 1232.

Applicable Law

Although not addressed by the parties, the court must first answer the threshold

question of which law applies to the present case: the pre-1993 law or the post-1993

law. Both the decision of the AIU, from which Petitioner appeals, as well as the

previous decision of the Hearing Officer, apply the facts to the pre-1993 law and, in the

* This is an inaccurate conclusion as of January 1992. See infra at 3-4.

3

alternative, to the post-1993 law. In 1991, the Legislature redrafted much of the Act,

which resulted in the repeal of Title 39 and the adoption of Title 39-A, effective January

1, 1993. In 1991, the legislature added language, which required employees to report

subsequent returns to work. L.D. 1981 (115th Legis. 1991) (effective January 1992); 39

M.R.S.A. § 106(3)(1989 & Supp.1992). The 1991 amendment to Title 39 included a

statement that the Board “shall send the employee notice of the employee’s

responsibility to notify the [Board] and the employer when the employee returns to

work.” 39 M.R.S.A. § 106(3) (1989 & Supp.1992). The Board continues to be responsible

for this notification under the post-1993 law. 39-A M.RS.A. §308(1)(1993 & 2003).

Therefore, whether the Title 39 or Title 39-A is applied, the law is the same—Petitioner

was required to notify of her return to work and the Board should have notified her of

this duty.

The ATU found that the Board’s failure to notify Petitioner of the obligation to

report her return. to work did not relieve Petitioner of her obligation to report. “The

administrative agency's interpretation of a statute administered by it, while not

conclusive or binding on this court, will be given great deference and should be upheld

unless the statute plainly compels a contrary result.” Thacker v. Konover Dev. Corp.,

2003 ME 30, { 14, 818 A.2d 1013 (internal quotations omitted). In the present case, the

duty of the Petitioner to report a return to work pre-existed the 1992 creation of the

Board’s obligation to notify employees. Furthermore, neither the 1992 statute nor any

subsequent amendments to the applicable present-day section, indicate that notification

by the Board is a prerequisite to imposition of the duty to report. 39 M.R.S.A. § 106(3)

(1989 & Supp.1992);. 39-A M.RS.A. §308(1)(1993 & 2003). For the above reasons, the

AIU’s interpretation is not error, notwithstanding the harmless error regarding the

1992 statute. See supra note 2.

Collateral Estoppel

Petitioner contends that the AIU is collaterally estopped from determining the

issue of whether Petitioner owed a duty to report her return to work because the Board

Hearing Officer previously determined that no duty existed due to the Board’s failure to

notify her of the duty. Collateral estoppel represents the "issue preclusion” prong of res

judicata and prevents the reopening, in a second action, of an issue of fact actually

litigated and decided in an earlier case. Camps Newfound /Owatonna v. Harrison, 1998

ME 20, J 11, 705 A.2d 1109. (describing the two species of res judicata: "issue preclusion"

and "claim preclusion"). See also Van Houten v. Harco Constr., Inc., 655 A.2d 331, 333

(Me. 1995) (collateral estoppel must be accorded to administrative proceedings).

Collateral estoppel applies only when the issue that the party is to be precluded

from relitigating has been (1) actually litigated; (2) determined by a final and valid

judgment and (3) the determination was essential to the Judgment. Cline v. Maine

Coast Nordic, 1999 ME 72, ¥ 9, 728 A.2d 686; Society of Lloyd's v. Baker, 673 A.2d 1336,

1341 (Me. 1996).

The facts of the present case do not support a finding that recovery is barred by

the doctrine of collateral estoppel because the issue was not essential to the judgment.

There is sufficient evidence on the record to determine that the Hearing Officer

addressed only the issues of Petitioner’s duty to report and her higher level of income.

Moreover, a finding of failure to report was not essential to the Hearing Officer’s

determination because 39 M.R.S.A. § 113(2)(1989) still allows for the assessment of

penalties for other reasons. Id. (including “willful violation of this Act, fraud or

intentional misrepresentation”). The express language of the Hearing Officer’s 1996

decree lends additional support to this conclusion. The Hearing Officer granted

_ Sheraton’s petition to terminate compensation because Petitioner's new wages were

greater than her old wages. R. at 70. The mention of Petitioner’s liability for failure to

report pursuant to 39-A MLR.S.A. § 360 (1993 & Supp. 2002) was mentioned only as an

aside. R. at 69.°

There exists substantial evidence on the record that Petitioner did violate her

duty to report her return to work, thus satisfying the requirements for the AIU’s

imposition of penalties pursuant to 39 M.R.S.A. § 113(2) (1989): Petitioner admitted

beginning work at Old Port Tavern in June of 1992 (R. at 68.); she never reported this to

the Board or the Board until the November 1996 Petition for Review (Id. at 69.);

penalties were appropriate and within the discretion of the Board (39 MRS.A. § 113(2)

(1989)). Furtherrnore, the AIU correctly determined “that compliance by the Board with

the language directing the Board to notify employees of the duty to report returns to

work, is not a pre-requisite to relief before the Abuse Unit.” R. at 587. 39-A MRSA. §

308(1) imposes an independent obligation to report a return to work, notwithstanding

the failure of the Board to notify her of this obligation. Because collateral estoppel does

not bar the AIU’s determination and assessment of penalties, Sheraton’s contention of

prejudice need not be addressed.

> Tt cannot be determined if the Hearing Officer’s decision was valid under the pre-1993 law

because it is not known whether the Board Rules in effect at the time contained a provision

similar to ch. 15. § 9, which removes determinations of violations of § 360 from the Hearing

Officer’s jurisdiction and places them within the jurisdiction of the ATU. However, such a

determination is unnecessary in light of the finding that issue of reporting was not essential to the

Hearing Officer’s decision. In the alternative, if the post-1993 law is deemed to apply,

The entry is

The decision of the Workers’ Compensation Board Abuse Investigation Unit is

AFFIRMED.

Dated at Portland, Maine this 28th day of May, 2003.

KML

Robert E. Crowley

Justice, Superior Court

Petitioner’s collateral estoppel argument still fails because the Hearing. Officer lacked jurisdiction,

which precludes the entry of a valid judgment.

Date Filed 07-30-02 CUMBERLAND Docket No. AP-02-41

Action 80C APPEAL

LEA CLOUTIER STATE OF MAINE,

WORKERS ' COMPENSATION BOARD

SHERATON TARA/FLATLEY COMPANY

vs. & ZURICH AMERICAN INS. COMPANY

Plaintiff’s Attorney

JEFFREY NEIL YOUNG, ESQ.

McTeague, Higbee, Case, Cohen, Whitney

& Toker, P.A.

4 Union Park

Defendant’s Attorney

JOHN C. ROHDE, ESQ.

27 STATE HOUSE STATION (Workers'Comp)

AUGUSTA, MAINE 04333-0027

207-287-7086

Aug. 30

Oct. 2

ALISON DENHAM, ESQ.

P.O. 000 ’

Topchan. ve 04086 P.O. BOX 7108 (Sheraton Tara & Zurich)

(207) 795-558] PORTLAND, MAINE 04112-7108

744-1486

Date of

Entry

2002

July 30 Received 07-30-02:

Summary Sheet filed.

Plaintiff's Petition for Judicial Review of Final Agency Action with

Exhibits A-B filed.

Received 8-16-02:

Respondents State of Maine Workers Compensation Board Motion for

Enlargement of Time in Which to File Appearance and Statement of Position,

filed.

Received 08-22-02:

Entry of Appearance of John C. Rohde, Esq. as General Counsel for The

Workers’ Compensation Board's filed.

Administrative Record (Volume 1 & 11) filed.

On 8-27-02.

As to Respondents’ Motion for Enlargement of Time in Which to File.

Appearance and Statement of Position:

Granted without objection. (Crowley, J.)

Copies mailed Jeffrey Neil Young, Esq., John Rohde, AAG. and Timothy

Collier, AAG on 8-27-02.

Received 08-12-02:

Entry of Appearance of Alison Denham, Esq. as counsel for Sheraton Tara

Flatley Company and Zurich American Insurance Company filed.

On 8+30-02.

Briefing schedule mailed. Petitioner's brief due 10-1-02.

Received 10-1-02.

Plaintiff's brief in support of complaint and petition for review of

fianl agency action filed.