Director, Office of Workers' Compensation Programs, U.S. Dept. of Labor v. National Mines Corp.

• Decision Date: 15 June 1977
• Docket Number: 76-1731,Nos. 76-1694,76-1749 and 76-1788,s. 76-1694
• Citation: Director, Office of Workers' Compensation Programs, U.S. Dept. of Labor v. National Mines Corp., 554 F.2d 1267 (4th Cir. 1977)
• Parties: DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. NATIONAL MINES CORPORATION and Old Republic Insurance Company, Respondents. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. ISLAND CREEK COAL COMPANY, Respondent. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. Q AND G COAL COMPANY, INC. and Old Republic Companies, Respondents. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. KESSLER COAL COMPANY, Respondent.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1267

554 F.2d 1267

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Petitioner, v.NATIONAL MINES CORPORATION and Old Republic Insurance

Company, Respondents.

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Petitioner, v.ISLAND CREEK COAL COMPANY, Respondent.

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Petitioner, v.Q AND G COAL COMPANY, INC. and Old Republic Companies, Respondents.

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Petitioner, v.KESSLER COAL COMPANY, Respondent.

Nos. 76-1694, 76-1731, 76-1749 and 76-1788.

United States Court of Appeals Fourth Circuit.

Argued Nov. 10, 1976.

Decided April 5, 1977.

Rehearing Denied June 15, 1977.

Frank A. White, Atty., U. S. Dept. of Labor, Washington, D.C. (William J. Kilberg, Sol. of Labor, Laurie M. Streeter, Associate Solicitor, Mark E. Solomons, Jean S. Cooper and Mary A. Sheehan, Attys., U. S. Dept. of Labor, Washington, D.C., on brief), for petitioner.

John L. Kilcullen, Washington, D.C.(Kilcullen, Smith & Heenan, Washington, D.C., on brief) for respondentsNational Mines Corp., Island Creek Co., Q & G Coal Co. and Old Republic Ins. Co.

Scott L. Messmore, Charleston, W. Va., (Jackson, Kelly, Holt & O'Farrell, Charleston, W. Va., on brief), for respondentKessler Coal Co.

Gail Falk, Charleston, W. Va., for United Mine Workers of America as amicus curiae urging reversal.

Before HAYNSWORTH, Chief Judge, and BUTZNER and WIDENER, Circuit Judges.

BUTZNER, Circuit Judge.

These consolidated petitions for review deal with the procedure for adjudicating claims under the Black Lung Benefits Act of 1972.¹ The principal issues are these: Is the Director, Office of Workers' Compensation Programs, Department of Labor, a proper party?We hold that he is.Secondly, do the 1972Amendments to the Longshoremen's and Harbor Workers' Compensation Act govern the procedures for adjudication of black lung claims?The Benefits Review Board said yes, and we affirm.Finally, can hearing officers, instead of administrative law judges, adjudicate the claims?The Benefits Review Board said no.We reverse because we believe that the Secretary of Labor has authority to designate hearing officers.

The Federal Coal Mine Health and Safety Act of 1969² was amended by the Black Lung Benefits Act of 1972³ to provide for the payment of benefits to coal miners who are totally disabled by pneumoconiosis and to the survivors of stricken miners.During the first phase of the program, the Department of Health, Education and Welfare adjudicated and paid claims filed between December 10, 1969, and June 30, 1973.⁴ The procedures set forth in the Social Security Act for determination of disability benefits were used in adjudicating these claims.⁵

During the second, transitional phase of the program, responsibility for adjudicating and paying claims filed between July 1, 1973, and December 31, 1973, was transferred from HEW to the Department of Labor.⁶ Beginning January 1, 1974, employers were obliged to pay benefits to eligible claimants.

Under the third phase of the program, ⁷Congress intended that the states would decide claims filed after January 1, 1974, under their own compensation laws.The Act nevertheless provides that in the absence of adequate state coverage, the Secretary of Labor should adjudicate claims and employers should be responsible for their payment.⁸ Unless the Secretary provides otherwise by regulation, the procedures set forth in the Longshoremen's Act, as amended, govern the adjudication of those disputed black lung claims filed during the second ⁹ and third ¹⁰ phases.

Before October, 1972, the Longshoremen's Act provided that compensation claims should be adjudicated by the Department of Labor's deputy commissioners.¹¹Federal district courts had jurisdiction to review these administrative decisions.¹² Appeals could be taken to the courts of appeals.¹³

In October, 1972, the Longshoremen's Act was amended to provide for adjudication by administrative law judges.¹⁴The Amendments abolish review by district courts, and, in their stead, create an administrative forum, the Benefits Review Board, to hear appeals from the decisions of administrative law judges.¹⁵The courts of appeals are authorized to review decisions of the Benefits Review Board.¹⁶

In May, 1973, the Secretary of Labor requested the Civil Service Commission to appoint administrative law judges to begin hearing black lung claims on July 1, 1973.The Commission, however, took the position that, since the Black Lung Act was amended in May, 1972, only those provisions of the Longshoremen's Act effective at that time govern the adjudication of black lung claims.Therefore, the Commission refused to appoint judges on the ground that the October, 1972 Amendments to the Longshoremen's Act did not apply to the Black Lung Act.

Lacking administrative law judges to consider black lung claims, the Secretary of Labor promulgated regulations and authorized hearing officers, who were not administrative law judges, to adjudicate the claims.Hearing officers rendered approximately 350 decisions from July, 1973, until February, 1976.The Benefits Review Board then ruled that only administrative law judges could hear the claims, and that, upon timely objection, judgments entered by hearing officers would be vacated.Fields v. A. K. P. CoalCo., BRB No. 75-155 BLA, 3 BRBS 269(Feb. 26, 1976).

In each of the four cases consolidated for review, the Benefits Review Board, relying on Fields, vacated the decision and remanded the case for a hearing before a duly-appointed administrative law judge.The Director petitioned for review, naming as respondents the coal companies and their insurance carriers from whom the miners seek compensation.

I

The coal operators and their insurance carriers contend that the Benefits Review Board should be named as a respondent to this proceeding.This contention, however, has been foreclosed by ITO Corp. v. Benefits Review Board, 529 F.2d 1080, 1088-89(4th Cir.1975).In that case, a panel unanimously held that the Benefits Review Board should be dismissed as a respondent to a petition for review of its own decision.Accord, Nacirema Operating Co., Inc. v. Benefits Review Board, 538 F.2d 73, 75(3d Cir.1976);Offshore Food Service, Inc. v. Benefits Review Board, 524 F.2d 967(5th Cir.1975);McCord v. Benefits Review Board, 168 U.S.App.D.C. 302, 514 F.2d 198, 200(1975).Subsequently, the court sitting en banc reheard ITO, but did not disturb this aspect of the panel's decision.ITO Corp. v. Benefits Review Board, 542 F.2d 903(4th Cir.1976).Accordingly, for the reasons stated in ITO, 529 F.2d at 1088-89, we adhere to the position that the Benefits Review Board is not a proper respondent.

A more difficult question concerns the standing of the Director to petition for review.In ITO Corp. v. Benefits Review Board, 542 F.2d 903, 906-09(4th Cir.1976), a majority of the en banc court held that the Director lacked standing to respond to a petition to review an order of the Benefits Review Board awarding compensation to a longshoreman.Because the Director had suffered no economic or other injury, the court concluded that he lacked the requisite stake to establish standing.The Third Circuit followed ITO in Director v. Rochester & Pittsburgh Coal Co., 556 F.2d 565(3d Cir.1977), holding that the Director does not have standing to petition for the review of orders of the Benefits Review Board vacating awards under the Black Lung Act.

In both ITO and Rochester & Pittsburgh Coal Co., the government, and consequently the Director, had no direct financial interest in the outcome of the cases.In ITO, only the stevedoring companies were potentially liable.In Rochester & Pittsburgh Coal Co., the court emphasized that awards were entered only against the employer and that the government's liability was secondary.In contrast, the Director, as the government's representative, has a direct financial interest in all of the four cases before us.¹⁷

Murphy, Ferrell, and Clear were filed under Part B of the Act, which includes the second or transitional phase of the black lung program.During this phase, the liability of both the government and the employer is adjudicated, but the government alone is liable for benefits payable before January 1, 1974.The employer becomes liable for payments commencing January 1, 1974, without any further adjudication.¹⁸ In both Murphy and Ferrell, the hearing officer found the claimants eligible for benefits.Because these cases were brought under Part B, he directed the Secretary to make payments during the transitional period and the coal operators to make payments thereafter.In addition, the coal companies were ordered to reimburse the Secretary for the payments he made after January 1, 1974.In Clear, the hearing officer found in favor of the Secretary against the claimant, denying any compensation during the transitional period.

Close was filed under Part C, dealing with claims filed on or after January 1, 1974.With respect to these claims, the employer is primarily liable, and the government's secondary liability arises only upon the failure of the employer to pay benefits.¹⁹ In Close, the operator was found liable, and ordered to pay benefits to the disabled miner.The operator was also ordered to reimburse the Secretary for benefits which the government paid after March 1, 1974.

Accordingly, the hearing officers' awards in all four cases were favorable, in whole or in part, to the Director in Murphy, Ferrell, and Close because he was adjudged entitled to reimbursement for funds expended, and in Clear because of an adjudication in his favor.The vacation of these favorable awards by the Benefits Review Board makes the Director a "person adversely affected or aggrieved...