CUMBERLAND STEEL, INC. PETITION FOR REVIEW OF A DECISION V. MORRIS ESTES; ROBERT L. WHITTAKER, Director of SPECIAL FUND; THOMAS A. NANNEY, Administrative Law Judge; and WORKERS' COMPENSATION BOARD
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RENDERED: October 23, 1998; 10:00 a.m.
NOT TO BE PUBLISHED
C ommonwealth O f K entucky
C ourt O f A ppeals
NO.
1998-CA-000729-WC
CUMBERLAND STEEL, INC.
APPELLANT
PETITION FOR REVIEW OF A DECISION
OF THE WORKERS' COMPENSATION BOARD
CLAIM NO. WC-96-06592
V.
MORRIS ESTES; ROBERT L. WHITTAKER, Director of
SPECIAL FUND; THOMAS A. NANNEY, Administrative
Law Judge; and WORKERS' COMPENSATION BOARD
APPELLEES
OPINION
AFFIRMING
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BEFORE:
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COMBS, EMBERTON, and GUIDUGLI, Judges.
COMBS, JUDGE:
Cumberland Steel, Inc. ("Cumberland Steel"),
petitions for review of a decision of the Workers' Compensation
Board that affirmed the opinion and award rendered by Hon. Thomas
A. Nanney, Administrative Law Judge ("ALJ"), and a subsequent
order denying petitioner's motion to reopen.
We affirm the
denial of relief.
On November 29, 1995, the claimant, Morris Estes,
suffered a severe injury to his pelvis while working at a
construction site in Bowling Green, Kentucky.
Estes was
apparently struck by a steel beam being hoisted by a crane.
He
lost consciousness at the scene, was hospitalized for six days,
and convalesced for approximately two months.
On August 27,
1996, he filed a workers' compensation claim against his
employer, Cumberland Steel.1
When the matter was heard by the
ALJ, the only medical evidence presented came from Dr. Philip
Singer, an orthopedic surgeon.
After considering Estes's
testimony and the medical evidence, the ALJ concluded that Estes
suffered from a 100 percent occupational disability.
Cumberland Steel appealed from the opinion and award.
At the request of Cumberland Steel, the appeal was abated.
Cumberland Steel indicated that it was prepared to file a motion
to reopen the claim based upon an alleged mistake.
In its motion to reopen, Cumberland Steel argued that
it had mistakenly been listed as Estes's employer.
An affidavit
signed by the President of Cumberland Steel indicated that Estes
was last employed by the corporation on November 10, 1995 -- a
number of days before Estes suffered his injury.
Also attached
to the motion was a Tennessee Employer's First Report of Work
Injury form.
This form identified Cumberland Construction Co. as
Estes's employer as of the date of the injury.2
Cumberland
1
The Special Fund was also joined as a party but was
ultimately dismissed from these proceedings, as there was no
evidence of its liability.
2
The report was prepared by Larry Summers, a site
supervisor, on December 5, 1995. A close inspection of the form
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Construction Co. had an address in Maryville, Tennessee;
Cumberland Steel has an address in Hendersonville, Tennessee.
The ALJ denied Cumberland Steel's motion to reopen the
claim.
In his order, the ALJ noted that while Cumberland Steel
had been duly served with pleadings throughout the proceedings,
it had elected not to defend against the claim in any manner.
Moreover, the ALJ explained, from the inception of the
proceedings, Cumberland Steel had been aware of each of the facts
it alleged as a basis for reopening the claim.
Cumberland Steel appealed to the Board, contending that
the matter should be remanded with directions to enter an award
against the appropriate defendant.
affirmed the ALJ's
The Board disagreed and
decision, stating as follows:
803 KAR 25:010 establishes the procedure for adjustment
of workers' compensation claims. The regulations in
effect on the date this claim was filed provided that a
defendant shall file a notice of claim denial or
acceptance within 20 days after the date of the
issuance of the notice that an application has been
filed and that if no notice of claim denial is filed,
all allegations of the application shall be deemed
denied. Section 2 of that regulation provides that
persons against whom the ultimate right to any relief
under Chapter 342 may exist are to be joined as
defendants.
Neither Cumberland Steel nor Fidelity nor CNA contend,
either in their motion to reopen or in this appeal,
that they were not served with the appropriate
pleadings required under both the regulations and the
Act, nor do they contest the ALJ's findings made below
that Estes is now 100 percent occupationally disabled.
What they wish to argue now is that Estes was actually
injured while working for a completely different
indicates that it was received at Cumberland Steel the following
day.
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company and that he was not even employed by Cumberland
Steel on the date of the injury, information that was
readily available to them prior to the time the ALJ
entered his original opinion and award. That opinion
and award decided all issues in controversy at that
time, and therefore the doctrine of res judicata
applies to it. Parsons v. Union Underwear, Ky.App.,
758 S.W.2d 43 (1988); Beale v. Faultless Hardware, Ky.,
837 S.W.2d 893 (1992).
Under the appropriate circumstances, the doctrine of
res judicata may be avoided in workers' compensation
proceedings through a motion to reopen. However, in
this claim, that motion to reopen must be grounded upon
ignorance before relief can be granted on account of
it. [citations omitted]. The "mistake" upon which the
petitioner's [sic] moved below to have this claim
reopened was based upon knowledge that was readily
available to them during the course of the proceedings
below and prior to the entry of the opinion and award.
* * * *
The petitioner refers to the alleged mistake by
claimant as to the appropriate defendant as being the
mistake under which this claim may be reopened. The
claimant, however, has not moved to reopen on the
grounds of a mistake. The ALJ therefore, in our
opinion, did not err in overruling the petitioner's
motion to reopen.3
In its petition for review, Cumberland Steel continues
to argue that the circumstances before us now are governed by the
"mistake" provision of the reopening statute and that the claim
should be remanded to the ALJ for judgment against the correct
defendant-employer.
We disagree.
KRS 342.125(1) provides that a party seeking to reopen
a workers' compensation award must establish a change of
occupational disability, mistake, fraud or newly discovered
3
The Board refused to consider the argument that the ALJ's
award illegally created insurance by estoppel as the issue had
not been properly raised before the ALJ.
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evidence in order to prevail.
Petitioner, however, has failed to
demonstrate that a misconception of any sort existed at the time
of the original award.
In Uninsured Employers' Fund v. Fox, Ky., 862 S.W.2d
902, 904 (1993), the court specifically stated that a "mistake,
regardless of whether it is of law or fact, must be founded upon
ignorance before relief may be granted on account of it."
Here,
there is no evidence indicating that any of the litigants labored
under a misapprehension as to the identification of the proper
party-defendant at the time the ALJ's award was entered.
While
Cumberland Steel maintains that it was not Estes's employer as of
the date of the injury, Estes presented persuasive evidence that
Cumberland Steel was indeed his employer at that time.
Julie
Pruitt, a legal assistant to Estes's attorney, attested, in part,
to the following facts:
1. When asked to obtain the precise name and address
of his employer, Estes reported that he was working on
a job site in Bowling Green, Kentucky for Cumberland
Steel. Cumberland Steel's address was 114 Canfield
Place, B-8, Hendersonville, Tennessee.
2. A letter received by counsel's office from CHUBB
Services Corporation indicated that the incident had
been reported by Estes's employer, Cumberland Steel.
3. Documents filed prior to the initiation of the
claim, including the Notice of First Payment, indicated
that "Fidelity & Casualty Company c/o CNA" was the
insurer.
4. Every pleading following the Form 101 had been
served upon Fidelity & Casualty Company pursuant to
information provided by the Department of Workers'
Claims.
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5. Despite correspondence and several telephone
conversations with representatives of CNA, there was
never any mention that the manner in which the employer
had been identified was erroneous.
6. Only in February 1997, did a representative of CNA
challenge (in a telephone conversation) claimant's
listing of Cumberland Steel as his employer as of the
date of the injury.
7. Fidelity & Casualty Company never entered an
appearance in the proceedings.
8. Cumberland Steel never challenged its designation
as the claimant's employer.
This information demonstrates that Estes was not acting
under a misconception when he indicated that Cumberland Steel was
his employer at the time of the injury.
To the contrary, it
demonstrates that Estes had a good-faith belief that he was
employed by Cumberland Steel at the time of his injury and that
he had reasonable grounds to support this belief.
While Cumberland Steel was aware of Estes's position,
neither it nor its insurer chose to challenge his contention
during the course of the proceedings.
In light of the
circumstances of this case, we conclude that Cumberland Steel was
in a position to respond to the pleadings and that, as a result,
it was compelled to present its arguments in the original
proceedings.
Clearly, it acted at its peril in failing to do so.
As was noted in Fox, reopening proceedings are designed
to prevent injustice resulting from the erroneous fact-finding of
an ALJ -- not to save litigants from the consequences of their
own mistakes.
Cumberland Steel was at all times aware of the
proceedings instituted against it.
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Therefore, it was obligated
to respond at the appropriate time, and its failure to do so and
the resulting consequences are not a proper basis for reopening.
Again, while the parties disagreed as to the identity
of Estes's employer as of the date of the injury, neither party
has asserted that it labored under any misapprehension or that it
operated on the basis of any "mistake" during the course of the
proceedings.
As a result, we cannot conclude that Cumberland
Steel can avail itself of the mistake provision of the reopening
statute.
Finally, we agree that Cumberland Steel's argument with
respect to its insurer's rights cannot be considered for the
first time on appeal.
It has not been shown that the Board
overlooked or misconstrued controlling statutes or legal
precedent -- or that the view of the evidence taken below was
either patently unreasonable or flagrantly implausible.
See
Western Baptist Hosp. v. Kelly, Ky., 827 S.W.2d 685 (1992).
Accordingly, the decision of the Board is affirmed.
ALL CONCUR.
BRIEF FOR APPELLANT:
BRIEF FOR APPELLEE MORRIS
ESTES:
Walter E. Harding
Louisville, KY
Robert M. Alexander
Glasgow, KY
BRIEF FOR APPELLEE SPECIAL
FUND:
Benjamin C. Johnson
Louisville, KY
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