KIMBERLY FIELDS v. HOSPITAL SPECIALTY; SPECIAL FUND; WILLIAM BRUCE COWDEN, JR., ARBITRATOR; DONNA H. TERRY, CHIEF ADMINISTRATIVE LAW JUDGE; AND WORKERS' COMPENSATION BOARD
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RENDERED: December 30, 1999; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-002821-WC
KIMBERLY FIELDS
APPELLANT
PETITION FOR REVIEW OF A DECISION
OF THE WORKERS' COMPENSATION BOARD
ACTION NO. 96-94997
v.
HOSPITAL SPECIALTY; SPECIAL FUND;
WILLIAM BRUCE COWDEN, JR., ARBITRATOR;
DONNA H. TERRY, CHIEF ADMINISTRATIVE
LAW JUDGE; AND WORKERS’ COMPENSATION BOARD
APPELLEES
OPINION
REVERSING AND REMANDING
** ** ** ** **
BEFORE:
JOHNSON, KNOX AND MILLER, JUDGES.
JOHNSON, JUDGE:
Kimberly Fields appeals from an order of the
Worker’s Compensation Board that reversed an order of the
Administrative Law Judge.
The ALJ had dismissed the employer’s
request for de novo review of a benefit review determination of
an arbitrator that had awarded Fields temporary total disability
(TTD) benefits and medical expenses.
Based upon the recent
Supreme Court case of KI USA, Corp. v. Hall, Ky., 3 S.W.3d 355
(1999), we reverse the Board’s granting of a de novo review by
the ALJ of the arbitrator’s benefit review determination.
Fields was a full-time employee of Hospital Specialty
from July 1989 to May 1997.
On November 13, 1995, she suffered
an injury to her right knee.
On January 13, 1998, she filed a
motion to resolve a medical fee dispute related to her November
1995 injury, and the matter was presented to an arbitrator.
The
arbitrator rendered a benefit review determination on May 21,
1998, which held Hospital Specialty responsible for medical
expenses incurred in the treatment of the work-related injury,
including the proposed surgery, and ordered TTD benefits from the
date of surgery until she reached maximum medical improvement.
The arbitrator bifurcated the claim and only decided issues
related to TTD and medical expenses. The arbitrator also held the
claim in abeyance, noting that upon Fields achieving maximum
medical improvement, any party could move to reactivate the
claim.
On June 11, 1998, Hospital Specialty filed a request
for a de novo hearing before an ALJ.
The Chief ALJ denied the
request on June 26, 1998, holding that the benefit review
determination was not a final order from which an appeal could be
taken.
Hospital Specialty filed a petition for reconsideration
of the June 26, 1998, order.
16, 1998.1
This petition was denied on July
Hospital Specialty then appealed the June 26, 1998,
1
A procedural oddity occurred at this point. The arbitrator
who had made the benefit review determination was W. Bruce
Cowden, Jr. In January 1998, Cowden, who had been appointed as
an Administrative Law Judge pursuant to KRS 342.230 was assigned
duties as an Arbitrator by the Commissioner in accordance with
KRS 342.230(3). Thus, ALJ Cowden became, for all practical
purposes, Arbitrator Cowden. The benefit review determination
that Cowden rendered on May 21, 1998, was done in his capacity as
an arbitrator. Hospital Speciality then sought a de novo
(continued...)
-2-
order that had denied its request for a de novo hearing, and the
July 16, 1998, order that had denied the petition for
reconsideration to the Board.
Hospital Speciality claimed that
the May 21, 1998, award was a final and appealable order.
The
Board reversed the decision of the Chief ALJ and held that the
May 21, 1998, award of TTD and medical benefits was not an
interlocutory order and that Hospital Specialty could appeal it
as a final order.
This appeal followed.
The purpose of a review by this Court “is to correct
the Board only where the the [sic] Court perceives the Board has
overlooked or misconstrued controlling statutes or precedent, or
committed an error in assessing the evidence so flagrant as to
cause gross injustice”.
Western Baptist Hospital v. Kelly, Ky.,
827 S.W.2d 685, 687-688 (1992).
Hospital Specialty relies on the following language
from KRS 342.275 and 803 KAR 25:010 sec. 12, for its argument
that it is entitled to appeal the benefit review determination to
the ALJ:
(1) Within thirty (30) days after the
filing of the benefit review determination
with the commissioner, any party may appeal
1
(...continued)
determination before an ALJ. Chief ALJ Donna Terry on June 26,
1998, in her capacity as an ALJ, dismissed Hospital Speciality’s
appeal. Hospital Speciality on July 8, 1998, timely filed a
petition for reconsideration of the Chief ALJ’s order of June 26,
1998. It was at this point that a procedure irregularity
occurred. Cowden entered an order on July 16, 1998, that denied
the petition for reconsideration and modified on his own motion
his May 21, 1998, benefit review determination. Thus, the July
16, 1998, order is erroneous in two aspects: (1) Cowden, as an
arbitrator, had no authority to rule on the petition for
reconsideration that was before the ALJ; and (2) Cowden, as an
arbitrator, had no jurisdiction to sua sponte modify the benefit
review determination when the matter was at the ALJ level.
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that determination by filing a request for
hearing before an administrative law judge.
Proceedings before the administrative law
judge shall be de novo but subject to
penalties for unreasonable proceedings under
KRS 342.310.
KRS 342.275.
(1) Within thirty (30) days after the date of
the filing of a written benefit review
determination or ruling on petition for
reconsideration from that benefit review
determination by an arbitrator, any party
aggrieved by the determination may appeal to
an administrative law judge.
803 KAR 25.010 sec. 122
However, the Supreme Court in KI USA, Corp. v. Hall,
supra, held that an arbitrator’s order granting interlocutory
benefits was not a “benefit review determination” because it was
not a “final order”.
The Supreme Court stated that “a ‘benefit
review determination’ is a written document which resolves ‘all
matters at issue’ with regard to a particular claim and,
therefore, does not include an interlocutory award of TTD.
342.270(4).
KRS
An arbitrator’s order granting interlocutory
benefits is not a ‘final order’ as defined in 803 KAR 25:010,
Section 13(1) and, therefore, may not be directly appealed to an
Id. at 359.3
ALJ.”
2
Effective July 13, 1998, after the Chief ALJ’s decision to
dismiss the appeal had been made, 803 KAR 25.010 sec. 12(1) was
amended whereby the following sentence was added: “No appeal
shall be taken from a written benefit review determination that
does not grant or deny the ultimate relief sought as to all
parties without the need for further steps to be taken.”
3
KRS 342.270(4) provides:
Except when compelling circumstances
justify delay and except as provided in
subsection (3)(b) of this section, the
arbitrator shall render a written
(continued...)
-4-
In the case sub judice, the arbitrator awarded
temporary total disability benefits and ordered the claim held in
abeyance until Fields had reached maximum medical improvement.
No findings were ever made as to permanent impairment.
The May
21, 1998, order did not resolve all matters at issue and did not
grant or deny the ultimate relief sought, which was a full and
complete resolution of the claim.
Hospital Specialty argues that if it is later
determined that the surgery was not related to the 1995 injury,
then there is no way that it can be returned to its former
position after having paid for the benefits and the surgery, and
it therefore would be permanently divested of a right.
apparently agreed with this argument.
The Board
However, the Supreme Court
has rejected this argument, and we are required to follow their
precedent.
3
Ramada Inn v. Thomas, Ky., 892 S.W.2d 593, 594
(...continued)
determination upon all matters at issue
within ninety (90) days of the assignment of
the claim. Through written order, the
arbitrator may grant or deny any benefit
afforded by this chapter, including
interlocutory relief.
803 KAR 25.010, sec. 13(1) provides:
Within thirty (30) days after the date
of filing of a final order of an arbitrator
other than a benefit review determination or
ruling on a petition for reconsideration from
that benefit review determination, any party
aggrieved by the order may file a “Request
for De Novo Review by an Administrative Law
Judge”. As used in this section “final
order” means one that grants or denies the
ultimate relief sought as to all parties
without the need for further steps to be
taken.
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(1995); see also Transit Authority of River City v. Saling,
Ky.App., 774 S.W.2d 468 (1989).
Thus, the arbitrator’s order was interlocutory in nature, and
the appeal was properly dismissed by the ALJ.
The Board is
reversed and this matter is remanded for further proceedings
consistent with this Opinion.
KNOX, JUDGE, CONCURS.
MILLER, JUDGE, DISSENTS.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE, HOSPITAL
SPECIALTY:
Jim M. Alexander
Lexington, KY
David L. Helmers
James R. Carpenter
Lexington, KY
BRIEF FOR APPELLEE, SPECIAL
FUND:
Joel D. Zakem
Louisville, KY
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