Food Lion, LLC and Delhaize America, Inc. v. Charles H. Dalton ( 2007 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Clements, Haley and Beales
Argued at Richmond, Virginia
FOOD LION, LLC AND
DELHAIZE AMERICA, INC.
OPINION BY
v. Record No. 0190-07-2 JUDGE JEAN HARRISON CLEMENTS
DECEMBER 11, 2007
CHARLES H. DALTON
FROM THE VIRGINIA WORKERS’ COMPENSATION COMMISSION
Dov M. Szego (William B. Pierce, Jr.; David G. Browne; William B.
Pierce & Associates, PLLC, on brief), for appellants.
No brief or argument for appellee.
Food Lion, LLC and Delhaize America, Inc., (collectively, employer) appeal a decision
of the Workers’ Compensation Commission (commission) refusing to docket for a hearing
employer’s application alleging Charles H. Dalton (claimant) unjustifiably refused selective
employment with employer and seeking the suspension of claimant’s open award of temporary
partial disability benefits on that basis. Employer contends the commission erred in concluding
employer’s application and supporting documentation failed to provide probable cause to justify
referring the application to the commission’s hearing docket. We agree with employer and,
therefore, reverse the decision of the commission and remand the case for referral to the
commission’s hearing docket.
I. BACKGROUND
The relevant facts are not in dispute. On October 2, 2004, claimant suffered a
compensable injury to his left foot while working for employer. After receiving medical care, he
was released to light duty work and returned to work with employer on November 8, 2004.
Claimant was suspended from work on November 9, 2004, and fired on November 29, 2004,
after employer learned that claimant had been convicted of aggravated sexual battery on October
28, 2004.
On December 17, 2004, employer filed with the commission an agreement to pay
benefits form and a termination of wage loss award form. Accepting the agreement to pay
benefits form, the commission entered an order on January 4, 2005, awarding claimant
temporary total disability benefits of $197.94 per week from October 28, 2004, to November 7,
2004, and temporary partial disability benefits of $51.27 per week beginning November 8, 2004,
and continuing. However, the commission rejected the termination of wage loss award form and
advised employer that a new, properly completed form would need to be filed.
After a number of unsuccessful attempts to get claimant to sign another termination of
wage loss award form, employer filed an employer’s application for hearing form on May 26,
2006, alleging a change in the circumstances that warranted claimant’s partial disability award.
The application indicated that employer sought suspension of claimant’s open award for
temporary partial disability benefits on the ground that claimant unjustifiably refused selective
employment within his physical capacity on November 29, 2004, the date he was fired because
of his felony conviction. The application further indicated that employer paid compensation to
claimant through May 13, 2006, as required by Commission Rule 1.4(C)(2). 1
As supporting evidence for the application, employer submitted copies of the October 28,
2004 and December 10, 2004 orders of the circuit court convicting claimant of aggravated sexual
battery and sentencing him to ten years in prison; the July 8, 2005 order of this Court denying
1
Commission Rule 1.4(C)(2) provides, in pertinent part, that “[c]ompensation shall be
paid through the date the application was filed, unless . . . [t]he application alleges a refusal of
selective employment . . . , in which case payment shall be made to the date of the refusal or 14
days before filing, whichever is later.”
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claimant’s petition for appeal; and the March 10, 2006 order of our Supreme Court refusing
claimant’s petition for appeal. Employer also submitted a copy of its personnel policy stating
that an employee “convicted of a criminal offense may be subject to dismissal.” Employer
submitted no medical records with the application.
By letter dated June 23, 2006, a senior claims examiner for the commission rejected
employer’s May 26, 2006 application for a hearing, finding that it did not provide probable cause
“to suspend compensation and grant a hearing.” Employer appealed that decision to the full
commission.
On December 21, 2006, the full commission affirmed the senior claims examiner’s
decision not to refer employer’s application to the hearing docket, holding that the application
and supporting documentation failed to provide probable cause to believe employer’s claim was
meritorious because employer did not submit contemporaneous medical evidence showing that
claimant had only partial, rather than total, work capacity as of May 13, 2006, the date through
which benefits were paid. In reaching that decision, the commission noted that claimant would
be entitled to benefits if he were totally disabled as of May 13, 2006, and that the most recent
medical evidence in the record concerned claimant’s work capacity in November 2004, which
“[was] irrelevant to an application filed in 2006.” Thus, the commission concluded, there was no
probable cause to believe that “grounds exist[ed] at a time proximate to May 13, 2006, to
modify, suspend, or terminate the outstanding award.”
By order dated January 16, 2007, the commission denied employer’s motion to
reconsider, and this appeal followed.
II. ANALYSIS
On appeal, employer contends the commission erred in affirming the senior claims
examiner’s refusal to docket employer’s May 26, 2006 application for a hearing on the ground
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that employer failed to submit contemporaneous medical evidence that claimant had only partial
work capacity as of May 13, 2006. Given that the award of benefits employer sought to have
suspended was an open award for temporary partial disability benefits and that neither party
alleged a change in claimant’s physical condition, the submission of such evidence was, as a
matter of law, not needed in this case to establish probable cause to believe employer’s claim
was meritorious, employer argues. Thus, employer concludes, the commission erroneously held
that employer’s application and supporting documentation failed to provide the requisite
probable cause to docket the application for a hearing. We agree with employer.
This appeal involves the commission’s application of its prehearing procedural rules to
the circumstances of this case.
The commission has the power to make and enforce rules not
inconsistent with the Workers’ Compensation Act in order to carry
out the provisions of the Act. Additionally, the commission has
the power to interpret its own rules. When a challenge is made to
the commission’s construction of its rules, the appellate court’s
review is limited to a determination of whether the commission’s
interpretation was reasonable. The commission’s interpretation
will be accorded great deference and will not be set aside unless
arbitrary or capricious.
Rusty’s Welding Serv., Inc. v. Gibson, 29 Va. App. 119, 129 n.2, 510 S.E.2d 255, 260 n.2 (1999)
(en banc) (citations omitted).
Pursuant to Commission Rule 1.4, an employer’s application for a hearing based on a
change in condition “must state the grounds for relief.” 2 Circuit City Stores, Inc. v. Scotece, 28
2
Commission Rule 1.4 provides, in pertinent part, as follows:
A. An employer’s application for hearing shall be in
writing and shall state the grounds and the relief sought. At the
time the application is filed with the Commission, a copy of the
supporting documentation shall be sent to the employee and a copy
to the employee’s attorney, if represented.
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Va. App. 383, 386, 504 S.E.2d 881, 883 (1998). In addition, the employer must submit
sufficient supporting documentation with the application to establish the requisite probable cause
to justify docketing the application for a hearing on its merits:
Under Commission Rule 1.5(A), the commission is required to
review the employer’s application for compliance with the
Workers’ Compensation Act and the commission’s rules. At this
preliminary stage, whether an employer is entitled to a . . . hearing
on the merits of its application hinge[s] upon whether its
application is “technically acceptable.” See Commission Rule
1.5(C). 3
. . . An employer’s application for hearing will be deemed
not “technically acceptable” and will be rejected unless the
employer’s designated supporting documentation is sufficient to
support a finding of probable cause to believe the employer’s
grounds for relief are meritorious. The commission has defined
the standard of “probable cause” as “[a] reasonable ground for
belief in the existence of facts warranting the proceeding
complained of.”
B. Each change in condition application filed by an
employer under § 65.2-708 of the Code of Virginia shall:
1. Be in writing;
2. Be under oath;
3. State the grounds for relief; and
4. State the date for which compensation was last paid.
3
Commission Rule 1.5 provides, in pertinent part, as follows:
A. After receipt the Commission shall review the claim or
application for compliance with the Workers’ Compensation Act
and Rules of the Commission.
* * * * * * *
C. If the employer’s application is technically acceptable,
the opposing party shall be permitted up to 15 days from the date
the application was filed to present evidence in opposition to the
application.
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Id. at 386-87, 504 S.E.2d at 883 (footnote added) (quoting Mixon v. Bay Area Movers &
Storage, Inc., No. 169-52-56 (Va. Workers’ Comp. Comm’n Apr. 21, 1997)).
Applying these principles to this case, we conclude that the commission’s interpretation
of its rules to reject employer’s application for lack of probable cause because employer did not
submit contemporaneous medical evidence that claimant had only partial work capacity as of
May 13, 2006, was unreasonable. For one thing, nothing in the commission’s record suggested
that claimant’s already-established partial work capacity had changed between November 8,
2004, and May 13, 2006.
Indeed, it is undisputed that, following his compensable injury on October 2, 2004,
claimant was released to light duty work and returned to work with employer in that capacity on
November 8, 2004. On December 17, 2004, employer filed a fully executed agreement to pay
benefits form stipulating that claimant was entitled to receive temporary partial disability
benefits beginning November 8, 2004. The commission accepted that agreement and entered an
order on January 4, 2005, awarding claimant temporary partial disability benefits based on his
return to selective employment as of November 8, 2004, and continuing.
It is also undisputed that employer’s May 26, 2006 application for a hearing was based
solely on employer’s allegation that claimant had unjustifiably refused selective employment
with employer when he was discharged for cause on November 29, 2004, as a result of his
October 28, 2004 felony conviction. Moreover, neither party alleged or submitted evidence, in
connection with the application or otherwise, that there was any change in claimant’s physical
condition or work capacity. It is clear, therefore, that employer’s application for a hearing
concerned only a “change in the conditions under which compensation was awarded . . . which
would affect the right to, amount of, or duration of compensation” and not “a change in physical
condition of the employee.” Code § 65.2-101 (defining the term “change in condition”).
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Under these circumstances, the submission of contemporaneous medical evidence that
claimant had only partial, rather than total, work capacity as of the date through which benefits
were paid was not required to establish probable cause to believe claimant remained only
partially disabled as of that date. Because nothing in the record suggested claimant’s work
capacity had changed between November 8, 2004, and May 13, 2006, the open award for partial
disability benefits itself provided the requisite probable cause.
For another thing, the commission’s decision in this case was inconsistent with its prior
interpretation of its rules in Peters v. M & W Construction, Inc., No. 167-37-20, 2003 VA Wrk.
Comp. LEXIS 1463 (September 30, 2003), rev’d on other grounds, Uninsured Employer’s Fund
v. Peters, 43 Va. App. 731, 601 S.E.2d 687 (2004), a case factually analogous to this one. In
Peters, the claimant, who was receiving temporary partial disability benefits subject to an open
award, was incarcerated in September 2001. In 2003, the Uninsured Employer’s Fund (fund)
filed an application seeking to suspend the claimant’s benefits based on his incarceration. A
deputy commissioner entered an award suspending claimant’s open award for temporary partial
disability benefits effective December 27, 2001. The claimant argued on appeal to the full
commission that the fund’s application should have been dismissed because the fund failed to
submit contemporaneous medical evidence that he had been medically released to perform
selective employment, as required by Code § 65.2-510.1. The commission rejected the
claimant’s argument, reasoning as follows:
We disagree with the claimant’s contention that 65.2-510.1(iii)
requires an employer to provide “new” proof that an incarcerated
claimant—who is currently receiving temporary partial disability
compensation based upon his release to selective employment—
has been medically re-released to perform selective employment as
a condition of suspending the claimant’s outstanding award for
disability compensation. Code 65.2-510(iii) [sic] does not apply
when it has previously been established that a claimant has been
released to selective employment and is receiving temporary
partial disability compensation. Instead, the additional
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requirement of providing a medical release to selective
employment applies when an employer seeks to suspend an
incarcerated claimant’s award of temporary total disability
compensation based upon the employee’s ability to perform
selective employment.
Here, the record reflects that the claimant had already been
released to perform selective employment and that he was under an
outstanding award for temporary partial disability compensation
when he was incarcerated on September 22, 2001, based upon his
federal drug conviction. Under the circumstances, the Deputy
Commissioner did not err when he suspended the claimant’s award
for temporary partial disability compensation pursuant to Code
65.2-510.1.
Peters, 2003 VA Wrk. Comp. LEXIS 1463, at *5-*6. Although the instant application to
suspend benefits was based on Code § 65.2-510, rather than Code § 65.2-510.1, logic dictates
that the commission should have applied the same underlying rationale in this case.
Accordingly, we conclude the commission’s contradictory decision in this case was
unreasonable.
We hold, therefore, that the commission erred in determining that employer’s application
and supporting documentation were insufficient to provide probable cause to believe employer’s
claim was meritorious because employer failed to submit contemporaneous medical evidence
that claimant had only partial work capacity as of May 13, 2006. Given that claimant was
receiving compensation pursuant to an open award for partial disability benefits, that employer’s
application for a hearing did not allege a change in condition based on a change in claimant’s
physical condition or work capacity, and that neither party alleged or submitted evidence of a
change in claimant’s physical condition or work capacity, such contemporaneous medical
evidence was unnecessary to establish the requisite probable cause. Thus, employer’s
application and supporting documentation were sufficient to justify referring the application to
the commission’s hearing docket, and the commission erred in affirming the senior claims
examiner’s refusal to do so.
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III. CONCLUSION
For these reasons, we reverse the commission’s decision and remand this case to the
commission for referral of employer’s application to the commission’s hearing docket.
Reversed and remanded.
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