Jeffrey Minor v. Aramark/VCU and Indemnity Insurance Company of North America ( 2012 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Elder, Kelsey and Alston
Argued at Richmond, Virginia
JEFFREY MINOR
OPINION BY
v. Record No. 1475-11-2 JUDGE ROSSIE D. ALSTON, JR.
FEBRUARY 21, 2012
ARAMARK/VCU AND
INDEMNITY INSURANCE COMPANY
OF NORTH AMERICA
FROM THE VIRGINIA WORKERS’ COMPENSATION COMMISSION
Robert L. Flax (Robert L. Flax, P.C., on briefs), for appellant.
S. Vernon Priddy, III (Two Rivers Law Group, P.C., on brief), for
appellees.
Jeffrey Minor (Minor) appeals a decision of the Virginia Workers’ Compensation
Commission (the commission) denying his request to take certain actions against Aramark/VCU
and Indemnity Insurance Company of North America (appellees) after appellees paid a portion
of Minor’s settlement award directly to the Department of Child Support Enforcement (DCSE).
Minor contends that the commission committed three errors. First, Minor argues that the
commission erred in failing to require appellees to pay Minor the balance of his settlement
award. Second, Minor contends that the commission erred in failing to rule that appellees should
not have paid DCSE more than 65% of Minor’s net settlement proceeds. Third, and finally,
Minor assigns error to the commission’s failure to assess a 20% late payment penalty against
appellees. For the following reasons, we conclude that the commission committed no errors and
affirm the decision below.
I. BACKGROUND
Prior to bringing this action, Minor and his wife were divorced in a bilateral proceeding,
with the court retaining continuing jurisdiction over both parties. As a result of the divorce,
Minor was required to pay monthly child support for the care and maintenance of his daughter.
These child support payments were deducted from Minor’s wages and unemployment benefits
through DCSE administrative support orders. These support orders obliged Minor to keep DCSE
informed of any changes in his address or employment status. Throughout the instant action,
Minor has claimed that he promptly notified DCSE each time his address or employment status
changed.
On June 19, 2009, Minor suffered a compensable work-related injury. On September 23,
2010, the commission approved a $30,000 settlement award for Minor’s workers’ compensation
claim. The settlement order specifically required appellees to comply with “any legally
enforceable” DCSE child support lien “to the extent required by law” in the course of paying the
award. The order also noted that legal fees of $6,000 and costs of $54.50 would be deducted
from the award, leaving Minor’s net proceeds at $23,945.50.
On an unknown date prior to the commission’s approval of the settlement award,
appellees received two administrative support orders from DCSE pertaining to Minor’s child
support obligation. The most recent order (hereinafter “the order”) stated that Minor owed a
child support arrearage in the amount of $22,784.46. The order commanded:
[Y]ou are hereby ordered:
1. To immediately withhold from access by the debtor or joint
account holder any property, assets, or money which is due, owing,
or belonging to the debtor with a value up to the full amount of the
child support debt shown above. All property above the amount of
the debt shall remain the property of the debtor.
* * * * * * *
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Failure to answer this order within the time prescribed, failure to
withhold property as directed in this order, release of assets subject
to this order to someone other than [DCSE], or failure to deliver
the withheld property pursuant to an Order to Deliver creates a
liability for you in an amount equal to 100 percent of the debt
specified in this order.
* * * * * * *
NOTICE TO DEBTOR/ABSENT PARENT:
* * * * * * *
To the extent that any property that is the subject of this order
constitutes “disposable income” as defined in [Code §] 63.2-100,
the maximum percentage of that income that is subject to this order
is 100%. (If previous space is blank, maximum percentage of
disposable income subject to this order is 65%). Any property that
does not constitute disposable income is subject to withholding in
its entirety.
If you wish to contest the order, you must file a written request for
an appeal hearing within 10 days from the date this notice is served
on you. Send your request to the Hearing Officer . . . .
* * * * * * *
If you disagree with the hearing officer’s decision, you can file an
appeal with the court within 10 days of receiving the decision.
* * * * * * *
Code Section[s]
34-29 63.2-1953 63.2-1925 63.2-1929 63.2-1930
Minor’s address was not listed on the order, and he maintained that he never received it.
Minor sent approximately twenty emails to appellees between September and October 2010,
inquiring about the settlement proceeds. Although appellees had multiple communications with
DCSE concerning the order from August through October 2010, appellees did not inform Minor
of the order or discuss the issue with him prior to paying DCSE the full amount requested:
$22,784.46. This amount constituted approximately 97% of the settlement proceeds from
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Minor’s workers’ compensation settlement award. Minor received the balance of the award
minus attorneys’ fees and costs in late October 2010.
On November 22, 2010, Minor requested a hearing with the commission, maintaining
that appellees overpaid DCSE for child support arrearages out of the balance of his settlement
award. Specifically, he argued that appellees should not have paid more than 65% of the net
proceeds of the award and requested that the commission order appellees to reimburse him for
the difference along with a 20% late payment penalty.
In February 2011, the deputy commissioner convened an evidentiary hearing. Minor
testified to the course of events as described above. Additionally, he testified that he had
planned to use the settlement proceeds to pay for a place to live, clothing, physical therapy, and
tools to find work as a handyman. Minor further testified that he was homeless, sleeping
outdoors, and receiving food stamps. He asserted that although he was homeless, he was able to
receive mail at his girlfriend’s house and had given DCSE her address. In this regard, Minor
introduced DCSE computer records that he obtained from a subpoena but none of them showed
that he had informed DCSE of this most recent address change. The records also did not show
that Minor was ever served with the order he contests herein. Minor also stated that he contacted
DCSE only after receiving the settlement payment, which was less than he had expected.
The deputy commissioner dismissed Minor’s application, specifically finding that
appellees were not permitted to ignore administrative support orders from DCSE. Additionally,
the deputy commissioner relied on the commission’s decision in Snyder v. Triplett, No.
203-61-68, 2005 VA Wrk. Comp. LEXIS 193 (Mar. 31, 2005), holding that the commission has
no authority to modify an administrative order from a state child support enforcement agency.
Relevant to this appeal, the deputy commissioner noted:
[Minor] has chosen the wrong forum and the wrong procedure to
contest the withholding percentage. The Commission has not
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entered or enforced any order or process in conflict with [Code
§] 34-29. The Commission has repeatedly declined to interfere in
a proceeding among [Minor], [appellees], and [DCSE].
On review, the commission affirmed the deputy commissioner’s decision, noting that
“[i]t is well-established that the Commission has no authority to order the DCSE to change the
amount it orders to be paid.” The commission also found that appellees had complied with the
order as written, and thus had no choice but to comply or risk incurring liability themselves as
threatened by the order. On the issue of notice, the commission stated that while the evidence
appeared to suggest that Minor was not served with the orders, the proper forum for this
challenge was the circuit court, not the commission. The commission later denied Minor’s
motion to reconsider, and Minor noted this appeal.
II. ANALYSIS
Here, Minor raises three distinct arguments in his first two assignments of error. Minor
argues that the commission should have ruled that appellees should not have paid DCSE more
than 65% of his net settlement proceeds and should have ordered appellees to pay him the
balance of his settlement award because: (1) the commission should have invalidated the order;
(2) the commission should have interpreted the order differently; or (3) the commission should
have found that the payment violated Minor’s due process rights. We will examine each
argument in turn before addressing his third assignment of error.
A. The Commission’s Authority over DCSE Administrative Support Orders
Although this Court generally gives deference to the commission’s construction of the
Workers’ Compensation Act on appeal, “we are ‘not bound by the commission’s legal analysis
in this or prior cases.’” Peacock v. Browning Ferris, Inc., 38 Va. App. 241, 248, 563 S.E.2d 368,
372 (2002) (quoting USAir, Inc. v. Joyce, 27 Va. App. 184, 189 n.1, 497 S.E.2d 904, 906 n.1
(1998)). Therefore, our review of this question is de novo.
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It cannot be disputed that Code § 65.2-700 limits the commission’s jurisdiction to “[a]ll
questions arising under” the Workers’ Compensation Act “except as otherwise herein provided.”
The Workers’ Compensation Act specifically makes awards, even those resulting from
settlements, subject to claims for child support. Code § 65.2-531(A) (“[B]enefits paid in
compensation or in compromise of a claim for compensation under this title shall be subject to
claims for spousal and child support . . . .”).
Although the question of the commission’s jurisdiction to settle the dispute in the instant
case is apparently one of first impression in this Court, the commission has repeatedly concluded
that it lacks jurisdiction and authority to modify, invalidate or interpret DCSE administrative
support orders. In Quinn v. Flowers Transport Inc., No. 197-02-82, 2002 VA Wrk. Comp.
LEXIS 1717 (Sept. 17, 2002), the commission addressed this issue, stating:
Should a “responsible person” (i.e. the claimant in the present
proceedings) wish to contest such an order [administrative
support order], Code § 63.1-250.3 [current Code § 63.2-1924]
sets forth the procedures, including an administrative hearing
pursuant to Code § 63.1-267.1 [current Code § 63.2-1942],
with appeal to an appropriate circuit court or juvenile and
domestic relations court. Significantly, the applicable statutes
do not grant the . . . Commission any authority to review or
modify a withholding order issued by [DCSE.]
Id. at *8-9 (emphasis added); see also Snyder v. Triplett, No. 203-61-68, 2005 VA Wrk. Comp.
LEXIS 193, *6-7 (Mar. 31, 2005) (citing Quinn for the same proposition and holding that the
commission “does not have the authority to interpret the order or to enter an award dictating how
the insurer will satisfy that order”); Feltus v. Gammon Well Co., No. 235-09-38, 2009 VA Wrk.
Comp. LEXIS 867 (Jan. 26, 2010) (citing Quinn and Snyder to hold the commission lacks
authority to order DCSE to change its orders or interpret them).
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We find the analysis in these decisions compelling.
Code § 63.2-1916 governs notice of an administrative support order, its contents, and
modification, stating specifically: “Any changes in the amount of the administrative [support]
order must be made pursuant to this section.” It also limits a support debtor to choosing between
two avenues when challenging the amount or validity of an administrative support order like the
order in this case. Id. Under Code § 63.2-1916, a support debtor may either: appeal the
administrative support order to DCSE (“The debtor and the obligee have 10 days from the date
of receipt of the notice to file an answer with the Commissioner to exercise the right to an
administrative hearing.”); or commence proceedings in the juvenile and domestic relations
district court (JDR court) or the circuit court (“The existence of an administrative order shall not
preclude either an obligor or obligee from commencing appropriate proceedings in a [JDR court]
or a circuit court.”).
When engaging in statutory interpretation, we are guided by the familiar principle that
“statutes concerning the same subject are to be read together, and construed, wherever possible,
so as to avoid conflict between them and to permit each of them to have full operation according
to their legislative purpose.” Eastlack v. Commonwealth, 282 Va. 120, 125-26, 710 S.E.2d 723,
726 (2011) (citing Hood v. Commonwealth, 280 Va. 526, 541-42, 701 S.E.2d 421, 430 (2010)).
Other than Code § 65.2-53.1 (recognizing that awards are subject to administrative support
orders), no other section of the Workers’ Compensation Act contemplates the commission’s
direct involvement or authority in the resolution of child support matters. Moreover, Code
§ 63.2-1916 specifies the remedies available to a support debtor who feels aggrieved by an
administrative support order, and those remedies do not include filing a claim with the
commission. Construing these two statutes to avoid conflict and allowing each to fully operate
according to its legislative purpose, we find that the validity of a DCSE administrative support
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order is not a question “arising under” the Workers’ Compensation Act, or “otherwise provided
for” in the Act. The commission therefore does not have the authority to modify, invalidate or
interpret the order in the case at bar. Minor’s remedy lies with DCSE, the JDR court, or the
circuit court.
Because the commission properly determined that it lacked authority to invalidate the
order as Minor requested, we affirm the commission’s refusal to invalidate the order.
B. The Commission’s Interpretation of the Order
In addition to contending that the commission could have and should have invalidated the
order, Minor argues that the Commonwealth’s general statutes overrode the commission’s
interpretation of the order. Minor misconstrues the commission’s decision. The commission did
not engage in any interpretation of the order – it merely stated that appellees complied with what
otherwise appeared to be a valid DCSE administrative support order. In making this observation
the commission noted, and we agree, that appellees were essentially faced with a Hobson’s
Choice of paying Minor his settlement proceeds or risking their own liability for more than
$22,000 to DCSE for noncompliance with the order.
As we concluded above, the commission has no authority to interpret DCSE
administrative support orders like the order in this case. Interpretation of these types of orders is
not, under any applicable principles of law, within the specialized knowledge of the commission.
Consequently, the commission did not err in constraining its decision in this case to the proper
scope of its authority.
C. Minor’s Due Process Claim
Minor next contends that his due process rights were violated because the order required
appellees to pay a percentage of the proceeds that exceeded what is allowable under Code
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§ 34-29. Additionally, Minor asserts that he was not served with the order prior to appellees’
paying over the percentage stated in the order.
Constitutional arguments raise questions of law which we review de novo. Covel v.
Vienna, 280 Va. 151, 163, 694 S.E.2d 609, 617 (2010).
Under Code § 63.1-252.1 [current Code § 63.2-1916], a person
responsible for the support of a child is assured notice and an
opportunity to be heard prior to a final adjudication of any
indebtedness. At the hearing, a responsible party may contest
liability for the debt and the amount of the debt. . . . Therefore, we
hold that Code § 63.1-252.1 [current Code § 63.2-1916] satisfies
the constitutional requirements of due process by providing a
responsible party with notice and an opportunity to be heard
before the judgment is final.
Morris v. Commonwealth, 13 Va. App. 77, 83, 408 S.E.2d 588, 592 (1991) (emphasis added).
In its disposition, the commission observed that while Minor’s due process rights may
have been violated, Minor was raising the argument in the wrong forum. Additionally, the
commission held that it lacked jurisdiction to interpret the service requirements for DCSE
administrative support orders. Consistent with our decisions on the previous assignments of
error, we find that interpretation of the service requirements for DCSE’s administrative support
orders is not a question arising under the Workers’ Compensation Act.
Minor maintains throughout his brief that he was denied due process because the time has
now expired for him to request a hearing from DCSE. The contrary is true. The ten-day period
for a support debtor’s response to an order is not “a jurisdictional bar. If the [administrative
support order] is not contested within ten days of receipt, DCSE has discretion to conduct an
administrative hearing.” Carmon v. Dep’t of Soc. Servs., 21 Va. App. 749, 754, 467 S.E.2d 815,
818 (1996). Nothing precluded Minor from exercising his prerogative to obtain a hearing with
DCSE and raising the notice issue in that forum, among the other issues he argued to the
commission.
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Accordingly, we find no error in the commission’s determination that Minor sought relief
on this issue in the wrong forum.
D. The Late Payment Penalty
In his third assignment of error, Minor argues that the commission erred in not assessing a
late payment penalty against appellees because appellees should have only paid DCSE 65% of
the net settlement proceeds. 1 Because the commission appropriately concluded that it could not
take any action against appellees for complying with the terms of the order, we find this
argument moot and decline to address it on appeal.
III. CONCLUSION
For the foregoing reasons, we affirm the commission’s decision.
Affirmed.
1
Minor also argued on brief that appellees’ counsel violated the Rules of Professional
Conduct by paying 97% of the settlement award to DCSE. We decline to address this argument
because the commission did not address it, and Minor failed to request that the commission rule
on it in his motion for reconsideration. See Hodnett v. Stanco Masonry, Inc., 58 Va. App. 244,
253, 708 S.E.2d 429, 434 (2011) (refusing to consider an issue on appeal because claimant did
not file a motion to reconsider after the commission failed to address an issue he raised for
review (citing Williams v. Gloucester Sheriff’s Dep’t., 266 Va. 409, 411, 587 S.E.2d 546, 548
(2003))).
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