Newman v. STATE EX REL. WORKERS'SAFETY AND COMPENSATION DIVISION

• Decision Date: 19 June 2002
• Docket Number: No. 01-191.,01-191.
• Citation: 2002 WY 91,49 P.3d 163
• Parties: In the Matter of the Worker's Compensation Claim of Beri NEWMAN, Appellant (Petitioner), v. STATE of Wyoming ex rel. WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION, Appellee (Respondent).
• Court: Wyoming Supreme Court

49 P.3d 163

2002 WY 91

In the Matter of the Worker's Compensation Claim of Beri NEWMAN, Appellant (Petitioner), v. STATE of Wyoming ex rel. WYOMING WORKERS' SAFETY AND COMPENSATION DIVISION, Appellee (Respondent).

No. 01-191.

Supreme Court of Wyoming.

June 19, 2002.

Steven R. Helling, Casper, Wyoming, Representing Appellant.

Hoke MacMillan, Attorney General; John W. Renneisen, Deputy Attorney General; Gerald L. Laska, Senior Assistant Attorney General; and David L. Delicath, Assistant Attorney General, Representing Appellee. Before LEHMAN, C.J., and GOLDEN, HILL, KITE, and VOIGT, JJ.

KITE, Justice.

[¶ 1] Beri Newman injured her neck and back while working at a restaurant in March of 1998 and received worker's compensation benefits for chiropractic treatments from March to November 1998. In July 1999, she again sought chiropractic care, this time for headaches and double vision. The Wyoming Workers' Safety and Compensation Division (division) and the Office of Administrative Hearings (OAH) concluded these symptoms did not result from the original accident and, therefore, were not work related. The district court affirmed the administrative decision. We affirm and clarify the appropriate standard of review.

ISSUES

[¶ 2] We rephrase the issues as follows:

1. What is the proper standard of review when both the claimant and the division present evidence at a contested case hearing?

2. Does the record support the hearing examiner's determination that Ms. Newman's testimony lacked credibility and she failed to prove her July 1999 physical complaints/symptoms were caused by her March 1998 work-related accident?

3. In denying benefits, did the hearing examiner err in applying Wyo. Stat. Ann. § 27-14-603(a) (LexisNexis 2001), which pertains to injury occurring over a substantial time period?

FACTS

[¶ 3] Ms. Newman was injured on March 13, 1998, while working at JB's Restaurant in Casper. She sought chiropractic care from H.R. Graber, D.C. In the written office questionnaire, Ms. Newman stated she had sprained her back while carrying "tray after tray" of dishes and had felt pain in her lower back immediately after the accident. In answer to the form's fill-in-the-blank questions, she indicated she never had headaches or vision problems but presently had low back problems, pain between her shoulders, neck problems, sore and weak muscles, and walking problems. In another form entitled Confidential Patient Case History, she indicated she had an occasional headache and had been previously treated by Dr. Graber in 1994 for neck problems. The insurance claim forms Dr. Graber submitted to the division indicated Ms. Newman received treatment from March through November of 1998 for low back pain and a lumbosacral sprain, and the division paid benefits for this treatment. Dr. Graber released Ms. Newman from his care on November 18, 1998, recording in his Daily Notes Report that her condition was progressing as anticipated and she had made satisfactory progress and was ready for discharge.

[¶ 4] In July of 1999, Ms. Newman returned to Dr. Graber for care. On or about July 14, 1999, he wrote a letter to the division stating he had previously treated Ms. Newman for a work-related injury for low back pain, lumbosacral subluxation, multiple cervical subluxations, cervicobrachial syndrome, lumbosacral sprain/strain, sacral/coccyx subluxation, and cervical neck pain. He further stated that Ms. Newman returned to his office on July 7, 1999, with symptoms similar to her March 1998 complaints and was continuing with treatment resulting from her original work-related accident. Dr. Graber did not mention in this letter that Ms. Newman had returned complaining of severe intermittent headaches and double vision, which were symptoms she had not experienced during the period of her prior treatment. The division denied benefits for several chiropractic bills stating variously that the services were not related to the original worker's compensation injury of March 13, 1998, "to the back" or "to the back and neck." The division based its denial of benefits in large part on an August 19, 1999, medical review panel recommendation. The three chiropractors who participated on the panel questioned the relationship between the new problems and the initial injury and opined the most recent symptoms were not a continuation of the previous injury.

[¶ 5] Ms. Newman appealed the denials. The OAH held a contested case hearing on January 20, 2000, which was continued to April 13, 2000, for completion. It issued its Order Denying Benefits on June 16, 2000, concluding Ms. Newman had failed to prove by a preponderance of the evidence that her headaches and double vision were an injury as that term is defined in Wyo. Stat. Ann. § 27-14-102(a)(xi) (LexisNexis 2001) and an injury which occurred over a substantial period of time pursuant to § 27-14-603(a). In reaching this determination, the hearing examiner found Ms. Newman's testimony lacked credibility because it was inconsistent with her March 1998 injury reports. Similarly, she concluded the reports of Dr. Graber and Don Thai, M.D., an independent medical examiner, were of little evidentiary value because they were based on Ms. Newman's version of the events.

[¶ 6] Ms. Newman filed a petition for review pursuant to W.R.A.P. 12.01. On July 27, 2001, the district court issued a detailed decision letter and Order Affirming Agency Decision. It held the hearing examiner's decision was supported by substantial evidence and was not arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law. Ms. Newman appeals from this order.

STANDARD OF REVIEW

Appeal from District Court's Review

[¶ 7] "When considering an appeal from a district court's review of agency action, we accord no special deference to the district court's conclusions. Instead, we review the case as if it had come directly to us from the administrative agency." French v. Amax Coal West, 960 P.2d 1023, 1027 (Wyo.1998) (citation omitted).

Applicable Standard—Arbitrary or Capricious or Substantial Evidence?

[¶ 8] In appeals of agency decisions, both the court and the parties have historically treated the applicable standard of review in an imprecise and, consequently, often inconsistent manner. Specifically, with regard to worker's compensation cases appealed pursuant to the Wyoming Administrative Procedure Act (WAPA), Wyo. Stat. Ann. § 16-3-114 (LexisNexis 2001), it appears there has been an unintentional and incremental muddling of the arbitrary or capricious standard and the substantial evidence test when agency decisions are reviewed. The blurring of these concepts has led to the citation of every possible administrative review standard in a scattergun effort to hit the target. This particular case is no exception.

[¶ 9] Section 16-3-114(c) (emphasis added) provides:

(c) To the extent necessary to make a decision and when presented, the reviewing court shall decide all relevant questions of law, interpret constitutional and statutory provisions, and determine the meaning or applicability of the terms of an agency action. In making the following determinations, the court shall review the whole record or those parts of it cited by a party and due account shall be taken of the rule of prejudicial error. The reviewing court shall:

(i) Compel agency action unlawfully withheld or unreasonably delayed; and

(ii) Hold unlawful and set aside agency action, findings and conclusions found to be:

(A) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;

(B) Contrary to constitutional right, power, privilege or immunity;

(C) In excess of statutory jurisdiction, authority or limitations or lacking statutory right;

(D) Without observance of procedure required by law; or

(E) Unsupported by substantial evidence in a case reviewed on the record of an agency hearing provided by statute.

Despite being separately expressed in the statute, these two tests have come to be used interchangeably by courts and litigants alike so as to hardly have independent meanings, a result we conclude was not intended by the legislature. "In interpreting a statute, every word, clause and sentence must be considered so that no part will be rendered inoperative or superfluous. Each element must be given meaning." State ex rel. Wyoming Worker's Compensation Division v. Mahoney, 798 P.2d 836, 838 (Wyo.1990) (citation omitted); see also Merkison v. State, 996 P.2d 1138, 1142 (Wyo.2000)

.

[¶ 10] In what can be viewed as a first step in the direction of addressing the problem we hope to cure today, this court noted "[t]he relationship between the substantial evidence rule as it pertains in administrative proceedings and the [arbitrary or capricious] rule that is used when the agency concludes that there has been a failure of proof has produced some consternation." Helm v. State ex rel. Wyoming Workers' Safety and Compensation Division, 982 P.2d 1236, 1240 (Wyo.1999). We attempt, in this opinion, to provide further clarification of these rules for the benefit of litigants, counsel, administrative agencies, hearing examiners, and the district courts.

[¶ 11] We are not the only jurisdiction grappling with this conundrum:

There has been confusion under the Federal Administrative Procedure Act in distinguishing the substantial evidence test from the arbitrary and capricious standard. Thus, one federal court has noted "an emerging consensus of the Courts of Appeals" that the distinction between the two is "largely semantic." Pacific Legal Foundation v. Department of Transportation, 593 F.2d 1338, 1343, n. 35 (D.C.Cir.), cert denied, 444 U.S. 830, 100 S.Ct. 57, 62 L.Ed.2d 38 (1979). We conclude that under the APA ... the sole determination by the reviewing court as to issues of fact before the agency is whether there was substantial evidence in the agency record to support the agency decision.

State Board of Health of...