Shubert v. Blue Chips

DEITS, C. J.

Claimant seeks review of an order of the Workers’ Compensation Board (Board) denying him an award of permanent partial disability (PPD). He challenges the validity of a temporary rule adopted by the Director of the Department of Consumer and Business Services (Director) pursuant to ORS 656.726(3)(f)(C) that amended the disability standards to address his impairment but awarded him no compensation. We affirm.

We recite the facts as found by the administrative law judge (ALJ). The Board adopted them, and they are supported by substantial evidence. ORS 183.482(8)(c). Claimant injured his left shoulder on April 30, 1987, and was eventually awarded unscheduled PPD of five percent. That award was later increased to 17 percent. On July 30,1990, claimant underwent surgery to remove a screw that had been inserted in his shoulder to treat the original injury. Claimant filed an aggravation claim for his condition resulting from the surgery. That claim was closed by a July 30,1991, determination order that did not award claimant any additional permanent disability benefits.

Following the issuance of that determination order, claimant obtained a report from Dr. Brenneke concluding that claimant suffered from a chronic condition that limited repetitive use of his left arm and shoulder and that claimant’s surgery entitled claimant to an impairment value of 10 percent. Claimant’s treating physician, Dr. Tesar, concurred in Brenneke’s report. These reports were submitted by claimant in support of his request for reconsideration of the determination order awarding no additional PPD. The request for reconsideration also included a request to stay the reconsideration proceedings while, pursuant to ORS 656.726(3)(f), the Director adopted a temporary rule addressing the impairment value of the effects of the surgery. The ALJ concluded that a temporary rule was not required and affirmed the determination order. The Board, however, held that the effects of the screw-removal surgery was not addressed by the standards for rating disability and that, consequently, the Director was required to adopt a temporary rule.

Pursuant to ORS 656.726(3)(f)(C), the Board remanded the claim to the Director for adoption of a temporary rule addressing the appropriate standards for rating claimant’s disability. On remand, the Director adopted OAR E38-6617, which provides, in part:

“This worker underwent Bristow repair and malleolar screw removal in the left shoulder. * * * Bristow repair of a dislocating shoulder improves the function of the shoulder and reduces the chance of dislocation. Removal of the screw fixation device does not result in recognized loss of shoulder function. In this case, the impairment value for these procedures shall be a value of zero. * * * Notwithstanding OAR 436-35-003, this rule applies only to WCD file no. E386617.”

Claimant filed a request for hearing on the Director’s decision. The ALJ upheld the Director’s action. Claimant then appealed to the Board. The Board concluded that the Director, not the Board or the Hearings Division, has the statutory authority to adopt disability standards for particular conditions pursuant to ORS 656.726(3)(f)(C). The Board held that, under the specific statutory scheme, neither it nor the Hearings Division had the authority to substitute its judgment for that of the Director on disability standards.¹ The Board noted, as it had in previous decisions, that it did have the authority to review a temporary rule for consistency with the applicable statutes. See Weston C. Foucher, 47 Van Natta 1518 (1995); Timothy H. Krushwitz, 45 Van Natta 158 (1993). Based on its understanding of its review authority, the Board concluded that the rule at issue in this case was not inconsistent with the statute and that it lacked authority to invalidate the rule on any other basis.

Claimant first argues that the Board erred in concluding that it lacked authority to invalidate the Director’s temporary rule. Claimant’s argument in this assignment of error is based on the general assertion that the Workers’ Compensation Board and the Director of the Department of Consumer and Business Services are one agency and that, therefore, it necessarily follows that the Board has complete authority to review the Director’s rules. However, it is unnecessary to resolve the question of whether these entities technically constitute one agency, because the respective roles of the Director and the Board relating to the adoption of disability standards is specifically addressed by the applicable statutes. The Director is the entity specifically authorized by statute to adopt such standards. ORS 656.726(3)(f)(C) provides, in part:

“When, upon reconsideration of a determination order or notice of closure * * * it is found that the worker’s disability is not addressed by the standards adopted pursuant to this paragraph, * * * the director shall stay further proceedings on the reconsideration of the claim and shall adopt temporary rules amending the standards to accommodate the worker’s impairment.” (Emphasis supplied.)

Although throughout ORS chapter 656 the roles of the Director, Hearings Division and the Board, with respect to specific types of actions and how each is reviewed, are clearly detailed, there is no indication anywhere in chapter 656 that the Board has the authority to substitute its judgment for that of the Director regarding disability standards. The plain language of the statutes makes it clear that the legislature delegated that authority to the Director.

As we held in our decision in Gallino v. Courtesy Pontiac-Buick-GMC, 124 Or App 538, 863 P2d 530 (1993), however, if the Board determines that there is no existing standard to rate a disability, it does have the authority to remand the matter to the Director to adopt a standard. In concluding that the Board had that authority, we relied on the statutory provision that “upon a finding that a disability is not addressed by existing standards the Director shall stay further proceedings and shall adopt temporary rules.” We concluded that if, in the course of a contested case proceeding on a claim, the Board decided that there was no disability standard that covered the claimant’s condition, it was necessary for the Board to remand the matter to the Director to adopt such a standard.² That, of course, is what happened here.

Further, there are no other general statutes that give the Board the authority to substitute its judgment for that of the Director regarding disability standards. ORS 183.400 generally governs the review of rules adopted by an agency. There is nothing in that statute, however, that provides authority for the Board to substitute its judgment for that of the Director regarding disability standards. Under ORS 183.400, the Director’s rules are subject to direct review by this court. The only instance where direct review to this court is not available is when

“the petitioner is a party to an order or a contested case in which the validity of the rule may be determined by a court.” ORS 183.400(1). (Emphasis supplied.)

Petitioner is a party to a contested case. Consequently, the rule may be and in fact is being reviewed pursuant to ORS 183.400 by this court in this judicial review.³ We conclude that the Board’s conclusions regarding its authority to review the Director’s rule were correct.

Claimant’s second assignment of error is that the Board erred in holding that the Director acted properly in promulgating a temporary rule awarding claimant zero disability. Claimant argues that the Board expressly found that claimant had sustained permanent impairment from the surgical procedure and that, by adopting a rule awarding zero disability, the Director “violated the law of the case.”

The Board’s order, however, directly disputes claimant’s assertion that it found that claimant had a rateable disability. As the Board explained:

“Here, pursuant to our remand order, the Director found that claimant’s left shoulder Bristow repair and malleolar screw removal surgery was not addressed by the ‘standards.’ Our order did not determine whether or not claimant had ratable [sic] impairment as a result of the surgery, but merely determined that the surgical procedure was not addressed by the Director’s ‘standards.’ In this regard, our review of a worker’s permanent disability is limited to the application of the Director’s ‘standards.’ ÓRS 656.295(5).

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“The promulgation of a temporary rule does not automatically result in a worker receiving an impairment value. Not all impairment necessarily results in a worker receiving an impairment value under the ‘standards.’ For example, a worker is not entitled to an impairment value for all range of motion losses. Rather, the lost range of motion must meet the requisite level established by the Director’s ‘standards.’ See OAR 436-35-330(1) (a worker not entitled to an impairment rating for the shoulder joint where he retains 150 degrees of forward elevation).”

Therefore, even assuming a law of the case principle would be applicable here, the Director’s action was not inconsistent with the Board’s determination and did not violate the law of the case.

Claimant’s final argument is that, even if the Board was correct that the Director could adopt a rule that awarded claimant no rateable disability, the rule is nevertheless invalid, because, under ORS 656.726(3)(f) and the general provisions of the Administrative Procedures Act (APA), a rule must concern matters of general applicability, and this rule does not. Claimant contends that this temporary rule is case specific and, because of that, comes within the definition of an “order” rather than a “rule” under the APA. Accordingly, claimant argues that the required procedures for the adoption of an order must have been followed here.

Claimant may be correct that the Director’s action here comes closer to the APA definition of an order rather than a rule. That argument would be persuasive were it not for the fact that here, a specific statute dictates the applicable procedures for the Director’s action and, accordingly, that statute controls over the general APA definitions. ORS 174.020. As noted above, ORS 656.726(f) specifically directs the Director to adopt disability standards for specific cases as temporary rules. It is within the legislature’s authority to designate specific procedures for particular actions, even if the procedures are somewhat unusual, and it has done so here. The Board did not err in refusing to invalidate the Director’s rule on the ground that it was improperly adopted as a rule.⁴

Affirmed.

1 However, the Board did hold alternatively that, even if it had the authority to substitute its judgment for that of the Director, it would not find the rule invalid.

2 The question of whether the Board could substitute its judgment for that of the Director on a disability standard was not before this court in Gallino, and we did not address that question.

3 Claimant did seek direct review by this court of the temporary rule in question here. We dismissed that request for review, however, based on our conclusion that we did not have jurisdiction, because

“petitioner is a party to a contested case pending before the Workers’ Compensation Board in which the validity of the rule may be determined by this court on judicial review of the Board’s order in that case.” (Emphasis supplied.) Shubert v. Department of Consumer and Business Services, CA No. A86479, dismissed May 17, 1995, citing ORS 183.400(1).

We adhere to that holding.

4 The dissent would hold that the Director’s rule is inconsistent with ORS 656.726(3)(f)(C) because it does not “accommodate” claimant’s impairment. However, claimant does not make that argument on review.