Dale v. S & S Builders, LLC

Decision Date18 July 2008
Docket NumberNo. S-07-0145.,S-07-0145.
Citation188 P.3d 554,2008 WY 84
PartiesIn the Matter of the Worker's Compensation Claim of Bradley M. DALE, Appellant (Petitioner), v. S & S Builders, LLC, Appellee (Employer), and State of Wyoming, ex rel., Wyoming Workers' Safety and Compensation Division, Appellee (Respondent).
CourtWyoming Supreme Court

Representing Appellee State of Wyoming ex rel. Wyo. Workers' Safety & Comp. Div.: Bruce A. Salzburg, Wyoming Attorney General; John W. Renneisen, Deputy Attorney General; Steven R. Czoschke, Senior Assistant Attorney General; Kristi M. Radosevich, Assistant Attorney General.

Before VOIGT, C.J., and GOLDEN, HILL, KITE, JJ., and GUTHRIE, D.J.

KITE, Justice.

[¶ 1] Bradley M. Dale appeals from the district court's order affirming the Office of Administrative Hearings (OAH) denial of his claim for worker's compensation benefits related to an infection in his right knee. Contrary to Mr. Dale's contention, the OAH did not commit a fundamental error by comparing his testimony during two parts of the contested case hearing. In addition, the OAH decision was supported by substantial evidence. We affirm.


[¶ 2] Mr. Dale presents two issues on appeal:

1. Are the Hearing Examiner's Findings of Fact, Conclusions of Law and Order denying benefits arbitrary, capricious or an abuse of discretion?

2. Was it a fundamental error for the hearing examiner to acknowledge that due to his prescription medication the Appellant "was not always coherent in his testimony" and recess the hearing, then make ultimate findings of fact in which discrepancies in the Appellant's testimony between the first segment and the second segment of the hearing were used?

Although phrased somewhat differently, the issues presented by S & S Builders, LLC (Employer) and State of Wyoming ex rel. Wyoming Workers' Safety and Compensation Division (State) are substantially the same as Mr. Dale's.


[¶ 3] In the summer of 2004, Mr. Dale worked for Employer as a truck driver and heavy equipment operator. Mr. Dale had a history of serious problems with, and extensive medical treatment to, his right knee including at least fourteen surgeries and three total knee replacements. Because of his knee problems, Mr. Dale was restricted from performing manual labor for Employer.

[¶ 4] On August 4, 2004, Mr. Dale's supervisor, Rick Potter, directed him to "baby sit" a silica fume concrete pour on a bridge outside of Laramie, Wyoming. The pour had been completed the night before, but it needed to be watched to ensure the concrete remained moist while it cured. Mr. Dale was using a water truck to keep the concrete moist and he filled the truck from the river below the bridge. When the truck was full, he climbed to the top to disconnect the hose. As he was climbing back down, he slipped and injured his right knee. He claimed that the slip caused severe pain, swelling and a minor scrape on his knee.

[¶ 5] Mr. Dale consulted several different physicians over the next few months because of his pain and concern that he had loosened his knee prosthesis when he slipped on August 4, 2004. None of the physicians' records referenced a scab or wound on his knee until he saw Kirk Kindsfater, M.D. in early November 2004. Dr. Kindsfater cultured the wound and referred Mr. Dale to a wound care clinic. The results of the culture were positive for a staphylococcus aureus (staph) infection. David Cobb, M.D., a wound care specialist, immediately hospitalized Mr. Dale and began aggressive treatment to counter the infection. While he was in the hospital, Mr. Dale filled out a report of injury, indicating that he had injured his right knee when he slipped on the truck on August 4, 2004.

[¶ 6] The State initially opened a case for the injury. The Employer, however, objected and the State apparently later joined in that objection. The OAH convened a contested case hearing on February 16, 2006, and, after Mr. Dale's direct testimony, continued the hearing because the hearing examiner was concerned about Mr. Dale's ability to proceed.

[¶ 7] After the second part of the hearing on June 14, 2006, the OAH issued a denial of Mr. Dale's claims, ruling that he had not met his burden of proving the infection was causally related to his work-related injury on August 4, 2004. Mr. Dale filed a petition for review with the district court, and the district court affirmed the OAH decision. Mr. Dale then appealed to this Court.


[¶ 8] When we consider an appeal from a district court's review of an administrative agency's decision, we give no special deference to the district court's decision. Instead, "`we review the case as if it had come directly to us from the administrative agency.'" Newman v. State ex rel. Wyo. Workers' Safety & Comp. Div., 2002 WY 91, ¶ 7, 49 P.3d 163, 166 (Wyo.2002), quoting French v. Amax Coal West, 960 P.2d 1023, 1027 (Wyo. 1998). Our review is governed by Wyo. Stat. Ann. § 16-3-114(c) (LexisNexis 2007).

[¶ 9] In Newman, we attempted to clarify the standards of review applicable to administrative cases in order to dispel the general confusion in our case law regarding the application of the very specific statutory language in § 16-3-114(c)(ii). That statutory provision states:

(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.

Section 16-3-114(c) (emphasis added). We remarked that the arbitrary or capricious standard and the substantial evidence tests had been muddled in cases when agency decisions are reviewed. The blurring of these concepts had "led to the citation of every possible administrative review standard in a scattergun effort to hit the target." Newman, ¶ 8, 49 P.3d at 166. Moreover, the case law had failed to give separate effect to the distinct standards of review stated in § 16-3-114(c).

[¶ 10] We attempted to provide guidance as to when the different standards should be applied. Newman's salient teachings included:

[W]e hold the substantial evidence test is the appropriate standard of review in appeals from WAPA contested case proceedings when factual findings are involved and both parties submit evidence. We further hold, when only the party with the burden of proof submits evidence in the contested case proceeding and that party does not ultimately prevail, the arbitrary or capricious standard governs the judicial review of that agency decision.

Despite this holding, even if the factual findings are found to be supported by substantial evidence, the ultimate agency decision could still be found to be arbitrary or capricious for other reasons. The arbitrary or capricious standard works as a "safety net" to catch agency action which prejudices a party's substantial rights or which may be contrary to the other WAPA review standards yet is not easily categorized or fit to any one particular standard. Section 16-3-114(c)(ii); Community Savings and Loan Association of College Station, Texas v. Vandygriff, 630 S.W.2d 457, 459 n. 3 (Tex.App.1982).

Id., ¶¶ 22-23, 49 P.3d at 171-72 (footnote omitted). We noted that identification of the correct standard of review is important because, although both the substantial evidence and arbitrary and capricious standards require review of the entire record, they compel the reviewing court to apply different tests to the record. Id., ¶ 19, 49 P.3d at 170.

[¶ 11] The substantial evidence test is described as:

"In reviewing findings of fact, we examine the entire record to determine whether there is substantial evidence to support an agency's findings. If the agency's decision is supported by substantial evidence, we cannot properly substitute our judgment for that of the agency and must uphold the findings on appeal. Substantial evidence is relevant evidence which a reasonable mind might accept in support of the agency's conclusions. It is more than a scintilla of evidence."

Id., ¶ 12, 49 P.3d at 168, quoting State ex rel. Wyo. Workers' Safety and Comp. Div. v. Jensen, 2001 WY 51, ¶ 10, 24 P.3d 1133, 1136 (Wyo.2001) (citations omitted). In addition, we explained in Newman, ¶ 26, 49 P.3d at 173, that in conducting a substantial evidence review of the record,

the deference that normally is accorded the findings of fact by a trial court is extended to the administrative agency, and we do not adjust the decision of the agency unless it is clearly contrary to the overwhelming weight of the evidence on record. This is so because, in such an instance, the administrative body is the trier of fact and has the duty to weigh the evidence and determine the credibility of witnesses.

See also, City of Casper v. Wyo. Dep't of Employment, 851 P.2d 1, 3 (Wyo.1993); Board of Trustees of Laramie County School Dist. No. 1 v. Spiegel, 549 P.2d 1161, 1178 (Wyo.1976).

[¶ 12] We also held that the arbitrary and capricious standard is appropriate to review evidentiary...

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