Butler v. Huttig Bldg. Products, 02-113.

• Decision Date: 23 May 2003
• Docket Number: No. 02-113.,02-113.
• Citation: 830 A.2d 44
• Parties: Jean BUTLER v. HUTTIG BUILDING PRODUCTS.
• Court: Vermont Supreme Court

830 A.2d 44

Jean BUTLER v. HUTTIG BUILDING PRODUCTS.

No. 02-113.

Supreme Court of Vermont.

May 23, 2003.

Richard H. Munzing of Weber, Perra & Munzing, P.C., Brattleboro, for Plaintiff-Appellant.

Keith J. Kasper of McCormick, Fitzpatrick, Kasper & Burchard, P.C., Burlington, for Defendant-Appellee.

Present: AMESTOY, C.J., DOOLEY, JOHNSON and SKOGLUND, JJ., and ALLEN, C.J. (Ret.), Specially Assigned.

ALLEN, C.J. (Ret.), Specially Assigned.

¶ 1. Claimant suffered serious injuries in a workplace accident, and appeals from an order of the Commissioner of Labor and Industry terminating his workers' compensation benefits due to fraud. We reverse and remand the Commissioner's decision on claimant's right to permanent disability benefits, but affirm the remainder of her order.

¶ 2. The undisputed facts are as follows. On February 24, 1997, while working for defendant Huttig Building Products as a tractor-trailer driver, claimant was seriously injured after 1,000 pound glass doors fell on his head at a loading dock. His injuries included fractures and dislocations in his spine, trauma to his left knee, ruptured disks in his back, and a central spinal cord contusion. Upon being struck, claimant immediately lost consciousness and suffered paralysis of his arms and legs. Claimant underwent three surgeries to address his spinal injuries, and was discharged from the hospital at the end of March 1997. At that time, claimant was still unable to walk and required help from others to engage in daily living activities. After his release, claimant received treatment for pain, depression, headaches, and other problems. He also received extensive physical and occupational therapy and home nursing services. Claimant obtained workers' compensation benefits for his injuries, including temporary disability, medical, and vocational rehabilitation benefits.

¶ 3. On September 13, 2000, defendant filed a so-called Form 27 with the Workers' Compensation Division of the Department of Labor and Industry notifying claimant that it was discontinuing temporary disability payments and medical benefits effective September 22, 2000. Defendant cited claimant's fraudulent activity as the reason for terminating payments, and filed supporting evidence to substantiate its allegations of fraud. On October 26, 2000, the Commissioner of the Department of Labor and Industry approved the Form 27. The following day, claimant filed a notice and application for a hearing to contest the termination of his benefits. In his application for hearing, claimant sought restoration of his temporary total disability compensation, in addition to medical and vocational rehabilitation benefits and attorneys' fees.

¶ 4. Initially, the Director of the Workers' Compensation Division denied claimant's request for a hearing, explaining that the Department was investigating defendant's allegations of fraud separately under 21 V.S.A. § 708 to determine whether to issue an administrative penalty for claimant's conduct. The Director asserted that claimant was not entitled to a hearing on the termination of his benefits, but that claimant would be offered an opportunity for a hearing on the administrative penalty if one issued. After corresponding with claimant's counsel, the Director reversed herself. A hearing on defendant's termination of workers' compensation benefits was held in May and June, 2001. ¶ 5. Prior to the hearing, claimant and defendant stipulated to some facts concerning claimant's fraud. Specifically, claimant admitted that he falsified (1) two medical notes from one of his doctors, Dr. Katz, (2) three receipts for the Fitness Barn, the place claimant performed physical therapy exercises, seeking reimbursements for overpayments claimant allegedly made, and (3) mileage reimbursement requests on eight separate dates for medical treatments claimant never received. The mileage and Fitness Barn reimbursements claimant falsified totaled $1,463.96. One of the falsified notes from Dr. Katz increased the dosage for certain medications claimant was taking, including an increase in the pain killer OxyContin.

¶ 6. Claimant's fraud went beyond the facts to which he stipulated, however. The Commissioner found that claimant sought mileage reimbursement for four trips to see Dr. Katz that claimant never made. Claimant also lied to his health care providers and exaggerated his symptoms in their presence. Claimant tried to deceive his physicians as well as the workers' compensation hearing officer by presenting himself as having a claw-like deformity in his hands known as "main en griff posture." He alleged that his hands were cold, stiff, and required gloves because of the deformity, and he wore gloves to the hearing. A videotape made without claimant's knowledge contradicted those claims. The tape showed claimant holding a gun in snowy weather without gloves and without any sign of a claw-like deformity, or any difficulty in performing fine motor movement.

¶ 7. Ultimately, the Commissioner upheld defendant's Form 27 termination and denied claimant further benefits. The Commissioner concluded that claimant's deceptive practices were ongoing, and that "what he tells to health care providers cannot be trusted." Although the Commissioner denied claimant's request to reinstate his benefits, she found that claimant's work-related injuries were undisputed and left him with a significant permanent impairment. The extent of the permanent disability had not been determined at that time, however.

¶ 8. Following the Commissioner's denial of claimant's motion to reconsider, claimant appealed to this Court. The Commissioner certified three questions¹ for our determination in accordance with 21 V.S.A. § 672, which we have reworked into a single question for clarity: Which, if any, compensation benefits should claimant forfeit because of his fraud? As we explain, the answer to that question is all benefits, except claimant's right to permanent disability benefits.

¶ 9. We first note that claimant does not contest the Commissioner's factual findings. In that case, we confine our review to the Commissioner's legal conclusions. Longe v. Boise Cascade Corp., 171 Vt. 214, 218, 762 A.2d 1248, 1253 (2000). If the Commissioner's conclusions are supported by the findings and reflect the correct interpretation of the law, we will affirm the Commissioner's decision. Id. at 218, 762 A.2d at 1252-53. Although we defer to the Commissioner's interpretation of the Workers' Compensation Act, we will not affirm an unjust or unreasonable interpretation of it. Clodgo v. Rentavision, Inc., 166 Vt. 548, 550, 701 A.2d 1044, 1045 (1997). In addition, we will not disturb a discretionary decision by an administrative agency unless the decision demonstrates the agency abused its discretion, see Piche v. Dep't of Taxes, 152 Vt. 229, 234, 565 A.2d 1283, 1286 (1989), or exercised it in an unrestrained manner. Lemieux v. TriState Lotto Comm'n, 164 Vt. 110, 113, 666 A.2d 1170, 1172 (1995).

¶ 10. Claimant argues that the Commissioner's decision to terminate all of his workers' compensation benefits, including permanent disability benefits, was disproportionate to claimant's fraud and amounted to an abuse of discretion. Defendant counters that claimant's fraud was so pervasive that the Commissioner properly exercised her discretion by refusing to approve any further compensation for his injuries. While we in no way condone claimant's fraud, we agree that the Commissioner abused her discretion by terminating claimant's right to permanent disability benefits.

¶ 11. To resolve the present dispute, we must review the Commissioner's interpretation of the Workers' Compensation Act. When construing the Act, we seek to implement the Legislature's intent as expressed in the words of the Act itself. See Colwell v. Allstate Ins. Co., 2003 VT 5, ¶ 7, 175 Vt. ___, 819 A.2d 727 (Court construes statutes to implement legislative intent found in the statute's plain language). We consider the relevant statutes at issue here in pari materia because they are part of the same statutory scheme governing workers' compensation. See id. at ¶ 20 (statutes that are closely related must be considered in reference to each other). We now examine the relevant provisions of the Act.

¶ 12. Workers who are injured during the course of their employment are entitled to compensation for their injuries. 21 V.S.A. § 618. The Act requires employers to provide the injured worker with medical, temporary and permanent disability, and in certain cases, vocational rehabilitation benefits. See 21 V.S.A. § 640 (medical); id. § 642 (temporary total disability); id. § 646 (temporary partial disability); id. § 644 (permanent total disability); id. § 648 (permanent partial disability); id. § 641 (vocational rehabilitation). Being a remedial statute, we construe the Workers' Compensation Act liberally so that injured employees receive benefits "unless the law is clear to the contrary." St. Paul Fire & Marine Ins. Co. v. Surdam, 156 Vt. 585, 590, 595 A.2d 264, 266 (1991); Montgomery v. Brinver Corp., 142 Vt. 461, 463, 457 A.2d 644, 646 (1983); Quinn v. Pate, 124 Vt. 121, 124, 197 A.2d 795, 797 (1964); see also 21 V.S.A. § 709 (rule that statutes in derogation of common law must be strictly construed shall not apply when construing Act).

¶ 13. The Act provides only two clear bases for terminating workers' compensation benefits following a compensable workplace injury.² First, temporary disability benefits, whether partial or total, terminate once the worker's disability ends. 21 V.S.A. §§ 643, 647. Second, all benefits under the Act are subject to forfeiture for fraud. Id. § 708(a). In cases of fraud, the Act vests discretion in the Commissioner to require forfeiture of "all or a portion" of workers' compensation benefits. Id. The obvious intent of § 708(a) is to deter and sanction false claims for compensation, and to relieve employers from having to pay...