Snowden v. Director, Office of Workers' Compensation Programs

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued April 13, 2001 Decided June 19, 2001

No. 00-1318

Florence Snowden,

Petitioner

v.

Director, Office of Workers' Compensation Programs,

United States Department of Labor, et al.,

Respondents

On Petition for Review of an Order of the

Benefits Review Board

Richard W. Galiher, Jr. argued the cause and filed the

briefs for petitioner.

Joshua T. Gillelan, II, Senior Attorney, argued the cause

for respondent Director, Office of Workers' Compensation

Programs. With him on the brief was Carol A. De Deo,

Associate Solicitor.

Roger S. Mackey argued the cause and filed the brief for

respondents Washington Hospital Center and Travelers

Property Casualty Company.

Before: Williams, Ginsburg and Rogers, Circuit Judges.

Rogers, Circuit Judge: This case is one of the last claims

likely to be brought by a District of Columbia employee under

the Longshore and Harbor Workers' Compensation Act, 33

U.S.C. ss 901-950 (1994).1 Florence Snowden appeals an

order of the Benefits Review Board of the United States

Department of Labor overturning a supplementary compen-

sation order of the Office of Workers' Compensation Pro-

grams. The underlying controversy is whether Ms. Snow-

den's compensation rate should include annual cost of living

adjustments under s 910(f) of the Act for the years between

her 1978 injury and the 1990 classification of her disability as

permanent and total. The only question the court reaches,

however, is whether the Board erred in asserting jurisdiction

to review the supplementary compensation order. We join

the other circuits that have addressed this question in holding

that the Board lacked jurisdiction to review the order because

it was issued pursuant to s 918(a), and thus became final

when issued, with relief available only from the district court.

Accordingly, we vacate the November 15, 1999 decision and

order of the Board.

I.

Florence Snowden injured her back in 1978 while working

__________

1 The Longshore and Harbor Workers' Compensation Act ap-

plies to injuries suffered by private-sector workers in the District of

Columbia before July 24, 1982. Thereafter, the District of Colum-

bia Workers' Compensation Act of 1979, D.C. Code s 36-301 to

36-345 (1981), applies. See District of Columbia Self-Government

and Governmental Reorganization Act, Pub. L. No. 93-198, ss 204,

302, 404, 87 Stat. 774, 783-84, 787-88 (1973). Because Ms. Snow-

den's injury occurred in 1978, we refer to the Longshore and

Harbor Workers' Compensation Act as it applies in the District of

Columbia as "the Act."

as a psychiatric nurse at the Washington Hospital Center.2

After a formal hearing, an Administrative Law Judge issued a

compensation order in 1992 awarding her benefits under the

Act for permanent total disability, "commencing December

18, 1990 and continuing for a period of 104 weeks thereafter,

including periodic increases to which she may be entitled

under the Act." Both the Office of Workers' Compensation

Programs ("OWCP") and Aetna appealed to the Benefits

Review Board; OWCP appealed the award of s 908(f)3 relief

to Aetna, while Aetna challenged the determination of perma-

nent total disability. The Benefits Review Board affirmed

the award of compensation but remanded the claim for

s 908(f) relief.4

The 1992 compensation order did not specify the manner in

which Ms. Snowden's benefit payments were to be calculated.

Rather, the order simply stated that Aetna must "pay all

periodic permanent total disability benefits ... including

periodic increases to which she may be entitled under the

Act." Thus, the order did not explicitly state whether Ms.

Snowden's compensation rate should reflect the annual cost of

living adjustments under s 910(f), i.e., the "catch-up" adjust-

ments, that had accrued in the years between her injury and

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2 For ease of reference, we refer to Ms. Snowden's employer,

the Washington Hospital Center, and its insurer, Aetna Casualty &

Surety Company (now known as Travelers Insurance Company) as

"Aetna." We also refer to "OWCP," the Office of Workers' Com-

pensation Programs, without distinguishing between actions taken

by various officials in or on behalf of OWCP.

3 Pursuant to s 908(f), the Special Fund, established in 33

U.S.C. s 944, will assume responsibility for permanent total disabil-

ity payments after 104 weeks if "the employee is totally and

permanently disabled, and the disability is found not to be due

solely to that injury...." 33 U.S.C. s 908(f)(1).

4 On remand, the Administrative Law Judge ruled that s 908(f)

was inapplicable and denied Aetna's request for reconsideration.

The Board affirmed on Aetna's second appeal. Aetna thereafter

reimbursed the Special Fund for payments it had made to Ms.

Snowden since December 1992 and reinstated payments at rates

that included catch-up adjustments.

the classification of her injury as a permanent and total

disability.5 Consistent with Brandt v. Stidham Tire Co., 785

F.2d 329 (D.C. Cir. 1986), OWCP advised Aetna that Ms.

Snowden's weekly compensation rate would increase from the

$192.80 that she had received for temporary total disability to

$357.80 for permanent total disability, a figure reflecting the

s 910(f) catch-up adjustments compounded since her 1978

injury. Aetna paid Ms. Snowden as OWCP instructed.

Aetna did not challenge OWCP's methodology for comput-

ing Ms. Snowden's benefit payments until June 11, 1998.

Then, relying on the Board's recent decision in Bailey v.

Pepperidge Farm, Inc., BRB No. 97-1156, 1998 WL 285563

(Benefits Review Bd. May 19, 1998), Aetna unilaterally cut

Ms. Snowden's weekly benefit payments by nearly half, from

$438.00 to $236.00, and requested an order from OWCP

allowing it to take a credit under s 914(j) for $76,626.31 in

alleged overpayments.6 Ms. Snowden filed a claim under

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5 Under s 910, "Determination of Pay," subsection (f) provides

that cost of living adjustments to compensation benefits are avail-

able only to those claimants whose disability is classified by OWCP

as permanent and total. See 33 U.S.C. s 910(f).

6 In Brandt, 785 F.2d at 332, this court adopted the interpreta-

tion of s 910(f) set forth in Holliday v. Todd Shipyards Corp., 654

F.2d 415, 417, 422 (5th Cir. 1981), whereby s 910(f) catch-up

adjustments were retroactive to the date of injury. In this opinion,

we refer to "Brandt/Holliday" as the rule that applied when OWCP

issued Ms. Snowden's 1992 compensation order. In 1990, the Fifth

Circuit, sitting en banc, overruled Holliday. See Phillips v. Ma-

rine Concrete Structures, Inc., 895 F.2d 1033, 1035 (5th Cir. 1990).

Some years later, in 1998, the Board held in Bailey that

Brandt/Holliday "no longer applies to cases arising under the [ ]

Act." Bailey, 1998 WL 285563, at *4. Henceforth, catch-up bene-

fits under s 910(f) would no longer be retroactive to the date of

injury but would apply only to periods after an injury was classified

by OWCP as permanent and total. See id. In contrast to the

request made by Aetna for a credit reimbursement, no retroactive

adjustment arose in Bailey, 1998 WL 285563, at *1-*4, because the

employer had never commenced paying at the retroactive catch-up

s 914(f)7 for additional compensation for overdue installments

based on Aetna's failure to pay in accord with Brandt/Holli-

day. OWCP issued a "supplementary compensation order" in

1998, finding Aetna in violation for failure to make more than

$3500 in benefit payments, and liable, therefore, under

s 914(f) for a penalty equal to 20% of the shortfall. Aetna

paid Ms. Snowden the past-due benefits but not the 20%

penalty.8 Aetna then appealed the supplementary compensa-

tion order to the Benefits Review Board.

The Board reversed OWCP's award of catch-up adjust-

ments in the 1998 supplementary compensation order, while

noting that because the penalty had not been paid, it "lack[ed]

jurisdiction to address the propriety of the penalty." On

reconsideration, the Board rejected OWCP's argument that

the Board lacked jurisdiction because the 1998 supplementary

compensation order was issued pursuant to s 918(a), and thus

was subject only to review by the district court. The Board

took the position that there had never been a formal determi-

nation in the 1992 compensation order that Ms. Snowden was

entitled to s 910(f) catch-up adjustments retroactive to the

date of her injury, and thus the alleged default of the catch-

up adjustments was not "compensation due under any award

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rate, and in Phillips, 895 F.2d at 1035-36, the employer and the

Board agreed not to seek reimbursement from the claimant.

7 Section 914(f), "Additional Compensation for Overdue Install-

ment Payments Payable Under Terms of Award," provides:

If any compensation, payable under the terms of an award, is

not paid within ten days after it becomes due, there shall be

added to such unpaid compensation an amount equal to 20 per

centum thereof, which shall be paid at the same time as, but in

addition to, such compensation, unless review of the compensa-

tion order making such award is had as provided in section 921

of this title and an order staying payment has been issued by

the Board or court.

33 U.S.C. s 914(f).

8 After Ms. Snowden filed for a default under s 918(a), OWCP

issued a second supplementary compensation order in 1999 declar-

ing the 20% penalty in default.

of compensation" pursuant to s 918(a). In the Board's view,

the 1998 supplementary compensation order was "an original

adjudication of the Brandt/Holliday issue which is subject to

review by the Board." The Board also ruled that Aetna

would not receive credit for catch-up adjustments made prior

to the Bailey decision but would be entitled to reduce Ms.

Snowden's payments subsequent to Bailey so as to recover

the amount of Brandt/Holliday overpayments.

II.

As a threshold matter, Ms. Snowden, joined by OWCP,

contends that the Benefits Review Board lacked jurisdiction

to review the 1998 supplementary compensation order be-

cause the order was issued under s 918(a), not s 921(a).

Our review of decisions and orders of the Benefits Review

Board is for errors of law and for confirmation that the Board

acted within the scope of its review in evaluating the decision

of the administrative law judge. See Brown v. I.T.T./Conti-

nental Baking Co., 921 F.2d 289, 293 (D.C. Cir. 1990) (citing

Stark v. Washington Star Co., 833 F.2d 1025, 1027 (D.C. Cir.

1987); Stevenson v. Linens of the Week, 688 F.2d 93, 96-97

(D.C. Cir. 1982); Sun Shipbuilding & Dry Dock Co. v.

McCabe, 593 F.2d 234, 237 (3d Cir. 1979)). The Board does

not make policy; "its interpretation of the [Act] thus is not

entitled to any special deference from the courts." Potomac

Elec. Power Co. v. Director, OWCP, 449 U.S. 268, 278 n.18

(1980) (citing Hastings v. Earth Satellite Corp., 628 F.2d 85,

94 (D.C. Cir. 1980); Tri-State Terminals, Inc. v. Jesse, 596

F.2d 752, 757 n.5 (7th Cir. 1979)). We hold that the Board

lacked the jurisdiction to review the 1998 supplementary

compensation order because it was a final order unreviewable

by the Board.

The Act provides for review of compensation orders in two

principal ways. Section 921 provides generally for the review

of compensation orders by the Board.9 Specifically, s 921(a)

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9 Section 921, "Review of Compensation Orders," provides in

subsection (b)(3):

provides that a compensation order shall become "effective"

upon its filing pursuant to s 919, "unless proceedings for the

suspension or setting aside [the] order are instituted" within

thirty days. 33 U.S.C. s 921(a). Until that time, the Board

has jurisdiction to "determine appeals raising a substantial

question of law or fact taken by any party in interest from

decisions with respect to claims of employees...." Id.

s 921(b)(3). In contrast, s 918(a) addresses the collection of

defaulted payments under an award of compensation.10 Thus,

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The Board shall be authorized to hear and determine appeals

raising a substantial question of law or fact taken by any party

in interest from decisions with respect to claims of employees

under this chapter and the extensions thereof. The Board's

orders shall be based upon the hearing record. The findings of

fact in the decision under review by the Board shall be conclu-

sive if supported by substantial evidence in the record consid-

ered as a whole. The payment of the amounts required by an

award shall not be stayed pending final decision in any such

proceeding unless ordered by the Board. No stay shall be

issued unless irreparable injury would otherwise ensue to the

employer or carrier.

33 U.S.C. s 921(b)(3).

10 Section 918, "Collection of Defaulted Payments; Special

Fund," provides in subsection (a):

In case of default by the employer in the payment of compensa-

tion due under any award of compensation for a period of thirty

days after the compensation is due and payable, the person to

whom such compensation is payable may, within one year after

such default, make application to the deputy commissioner

making the compensation order or a supplementary order

declaring the amount of the default. After investigation, no-

tice, and hearing, as provided in section 919 of this title, the

deputy commissioner shall make a supplementary order, de-

claring the amount of the default, which shall be filed in the

same manner as the compensation order.... The applicant

may file a certified copy of such supplementary order with the

clerk of the Federal district court for the judicial district in

which the employer has his principal place of business or

maintains an office, or for the judicial district in which the

injury occurred.... Such supplementary order of the deputy

where an employer has failed to make payment for thirty

days after a payment is due under a compensation award, the

claimant may file for a supplementary order declaring the

amount in default; the supplementary order becomes "final"

when issued. Id. s 918(a). Review is not available by the

Board, but only in an enforcement proceeding in the district

court. See id. The Ninth Circuit has described the three

prime distinctions between s 918 orders and s 921 orders:

(1) [O]rders issued under s 918, unlike s 921 orders, are

not appealable to the Board; (2) s 918 orders are final

when issued unlike s 921 orders which do not become

final until after 30 days or, if appealed, after appeal; and

(3) as a result, s 918 supplementary orders can immedi-

ately be filed with the federal district court for enforce-

ment.

Providence Wash. Ins. Co. v. Director, OWCP, 765 F.2d 1381,

1385 (9th Cir. 1985). OWCP maintains that "finality" under

s 918(a) means that "such an order is not subject to the

ordinary review process of s [9]21, at least where the amount

declared in default has not been paid in full, because such

review would be duplicative of that available from the district

court."

As other circuits have observed, the Longshore and Harbor

Workers' Compensation Act is "explicitly designed to encour-

age the prompt payment by employers of obligations under a

compensation order notwithstanding the existence of an ap-

peal." Id. at 1384. Thus, the Fifth Circuit stated that where

employers fail to meet their obligations, s 918(a) "provides a

quick and inexpensive mechanism for the prompt enforcement

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commissioner shall be final, and the court shall upon the filing

of the copy enter judgment for the amount declared in default

by the supplementary order if such supplementary order is in

accordance with law. Review of the judgment so entered may

be had as in civil suits for damages at common law. Final

proceedings to execute the judgment may be had by writ of

execution in the form used by the court in suits at common law

in actions of assumpsit....

33 U.S.C. s 918(a) (footnote omitted).

of unpaid compensation awards, a theme central to the spirit,

intent, and purposes of the [Act]." Tidelands Marine Serv.

v. Patterson, 719 F.2d 126, 129 (5th Cir. 1983). With that

statutory purpose in mind, it follows that a s 914 order and a

s 918 standard default order differ only in immaterial ways;

under the former, OWCP must compute the 20% penalty

amount that should be added to the default amount. An

order issued under s 914(f) thus "is nothing more than a

standard default order, plus an additional arithmetic compu-

tation." Providence, 765 F.2d at 1386. Because s 914 di-

rects that both the default amount and the penalty amount be

paid at the same time, the terms of the statute explicitly

reject any distinction between s 918 awards of "existing

compensation" and s 914(f) awards of "additional compensa-

tion." Id. Both awards are "based on an appealable prior

compensation order that resolves the substantive rights of the

parties." Id.

Both the statute and caselaw indicate that whether the

award of additional compensation for overdue installments

and the declaration of the default are separately issued

orders or combined into a single supplementary order is

irrelevant. See id. at 1385; Tidelands, 719 F.2d at 128-29 &

128 n.3. In Tidelands, when the employer failed to pay the

s 914(f) penalty due within thirty days after the filing of the

award, OWCP issued a supplementary compensation order,

finding the employer in default of the penalty under s 914(f).

See Tidelands, 719 F.2d at 128 & n.3. The Fifth Circuit held

that the second order was not a s 914(f) order because the

clear "substance [of] the order was a 'supplementary order

declaring the amount of the default' within the meaning of

Section [9]18(a) of the [Act]...." Id. at 128 n.3. In Provi-

dence, the supplementary compensation order awarding a

20% penalty and the supplementary compensation order de-

claring default of the 20% penalty were combined into a

single supplementary compensation order. See Providence,

765 F.2d at 1385. The Ninth Circuit adopted the Fifth

Circuit's approach, observing that were the s 914(f) supple-

mentary order "subject to s 921 procedures, it would be far

more difficult and cumbersome for a claimant to collect both

awards at the same time," as the Act contemplates. Id. at

1386. For, as the Ninth Circuit noted, the default amount

would be immediately collectible, while the 20% penalty could

be collected only after waiting for the expiration of the 30-

day review period under s 921 and then obtaining from

OWCP a second supplementary order under s 918 declaring

the first supplementary order in default. See id. The latter

scheme, the court concluded, "is obviously needlessly duplica-

tive and time consuming and completely at variance with

Congress' intent," id. (citing Tidelands, 719 F.2d at 129),

namely, to provide "a quick and streamlined mechanism for

the collection of compensation under the [Act]." Id.

Consequently, "notwithstanding the general grant of juris-

diction to the Benefits Review Board contained in 33 U.S.C.

s 921(b)(3)," the circuits to address the issue have concluded

that "actions for the enforcement of orders declaring default

in the payment of [installments] due under either s 914(f) or

any other substantive section of the [Longshore and Harbor

Workers' Compensation Act] are to be brought in the district

court and, only subsequent thereto, by appeal to the appropri-

ate court of appeals." Tidelands, 719 F.2d at 129; see also

Sea-Land Serv., Inc. v. Barry, 41 F.3d 903, 907 (3d Cir.

1994); Providence, 765 F.2d at 1386. We agree, for reasons

set forth by the Fifth and Ninth Circuits, that such an

interpretation is consistent with the statutory language and

"far better" conforms to Congressional intent. Providence,

765 F.2d at 1386.

The 1998 supplementary compensation order was sought by

Ms. Snowden pursuant to s 914(f) and resulted in OWCP's

issuance of a supplementary order declaring Aetna in default

of paying installments due under the 1992 compensation

order. See supra n.8. As such, the 1998 order was manifest-

ly an order for the collection of defaulted payments within the

meaning of s 918(a). As OWCP states, the 1992 compensa-

tion order was "plainly premised on th[e] view" that

Brandt/Holliday applied to all awards for permanent total

disability under the Act, and "on the consequent proposition

that the compensation [ ] calculated and declared in default

was 'due under' the [1992 compensation order]." Respon-

dent's Brief at 15. The Board's characterization of the 1998

supplementary compensation order as "an original adjudica-

tion of the Brandt/Holliday issue" ignores both this circuit's

law at the time the 1992 compensation order was issued and

OWCP's contemporaneous understanding of the compensa-

tion rate for permanent total disability benefits in the District

of Columbia. The Board's interpretation would also mean

delays in receipt of amounts due to claimants contrary to the

purposes of the Act and the specific provisions of s 918 to

ensure quick payment of defaulted amounts. See Providence,

765 F.2d at 1386.

Essentially then, the Board failed to acknowledge the dis-

tinction between appeals of compensation orders and proceed-

ings relating to compensation orders that are not direct

appeals of the underlying compensation orders, but are "ap-

plication[s] for a supplementary order declaring a default in

the payment of compensation under s [9]18(a)...." Bray v.

Director, OWCP, 664 F.2d 1045, 1047 (5th Cir. 1981). "Such

a deficiency is distinct from an error of fact or law, which

must be asserted within 30 days after the filing of a compen-

sation order." Id. (citing s 921(a)). Given the undisputed

record that Aetna paid Ms. Snowden pursuant to the 1992

compensation order on the basis that she was entitled to the

benefit of the catch-up adjustments, the fact that s 910(f) was

not explicitly mentioned in the 1992 compensation order is not

dispositive of the jurisdictional issue. The reference was

implicit in light of Brandt/Holliday, and for years Aetna paid

without challenging OWCP's methodology for calculating Ms.

Snowden's compensation rate. When Aetna did challenge the

methodology, it relied on the Board's decision in Bailey,

which acknowledged a change of law in ruling that the

Brandt/Holliday rule "no longer applies to cases arising

under the [ ] Act." Bailey, 1998 WL 285563, at *4.

Finally, although Ms. Snowden and OWCP ask the court to

address whether Brandt/Holliday is still law in this circuit,

we decline to do so in view of our holding that the Board

lacked jurisdiction to review the supplementary compensation

order. Once the court has determined that the agency did

not have jurisdiction to act, the court has declined to consider

the merits of contentions that the agency erred. See, e.g.,

Stoddard v. Board of Governors of the Fed. Reserve Sys., 868

F.2d 1308, 1312 (D.C. Cir. 1989); see also Synovus Fin. Corp.

v. Board of Governors of the Fed. Reserve Sys., 952 F.2d 426,

428 (D.C. Cir. 1991); Seatrain Lines, Inc. v. Federal Mari-

time Comm'n, 460 F.2d 932, 949 (D.C. Cir. 1972), aff'd, 411

U.S. 726 (1973). In view of our practice, which is binding

absent en banc review, the court has no occasion to decide

whether it has jurisdiction to reach the substantive conten-

tions. Cf. Steel Co. v. Citizens for a Better Env't, 523 U.S. 83

(1998); Bender v. Williamsport Area Sch. Dist., 475 U.S. 534,

541 (1986).11

Accordingly, because the Benefits Review Board lacked

jurisdiction to review the 1998 supplementary compensation

order issued pursuant to s 918(a), we vacate the November

15, 1999 decision and order of the Board.

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11 The court, therefore, also does not reach Ms. Snowden's

contentions that any modification to Brandt/Holliday be prospec-

tive, and that the Board erred in ruling that the lower compensation

rates should be applied as of the date of Bailey. The court likewise

does not reach OWCP's contentions that the Board misread Brandt,

that this court should overrule Brandt, and that, in any event,

Aetna waived any objection to the application of Brandt by failing

timely to raise its objection.