Director, Office of Workers' Compensation Programs, U.S. Dept. of Labor v. Quarto Min. Co.

• Decision Date: 24 April 1990
• Docket Number: No. 89-3453,89-3453
• Citation: 901 F.2d 532
• Parties: DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Petitioner, v. QUARTO MINING COMPANY; Elba F. Bellomy, Respondents.
• Court: U.S. Court of Appeals — Sixth Circuit

Page 532

901 F.2d 532

DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Petitioner, v. QUARTO MINING COMPANY; Elba F. Bellomy, Respondents.

No. 89-3453.

United States Court of Appeals, Sixth Circuit.

Argued Jan. 16, 1990.

Decided April 24, 1990.

Michael J. Denney (argued), U.S. Dept. of Labor, Office of the Sol., Washington, D.C., for petitioner.

William M. Hanna (argued), David J. Millstone, Squire, Sanders & Dempsey, Sanford A. Meizlish, Barkan & Neff, Columbus, Ohio, for respondents.

Before MARTIN and WELLFORD, Circuit Judges; and EDWARDS, Senior Circuit Judge.

BOYCE F. MARTIN, Jr., Circuit Judge.

This case addresses the propriety of the administrative law judge's determination that under the Black Lung Benefits Act, 30 U.S.C. Sec. 901 et seq., Quarto Mining Co. was entitled to transfer its liability for the reopened claim of Elba F. Bellomy to the Black Lung Disability Trust Fund.

Elba F. Bellomy was employed as a miner in the coal fields of West Virginia and Ohio. He filed a claim for black lung benefits with the Social Security Administration on December 16, 1970. That claim was denied on January 23, 1971. On September 11, 1972, he filed a second black lung benefits claim with the Social Security Administration which was also denied. These claims are categorized as "Part B" claims under the Black Lung Benefits Act because they were filed on or before July 1, 1973.

On April 16, 1979, Bellomy filed a third claim for black lung benefits with the Department of Labor. This claim is categorized as a "Part C" claim under the Black Lung Benefits Act because it was filed after December 31, 1973. The Department of Labor issued a Notice of Initial Finding on February 8, 1980, which awarded benefits to Bellomy. Bellomy's injury for the purposes of this claim occurred in the State of Ohio and his employer at this time was Quarto Mining Co. Quarto Mining Co. challenged this finding, and in an Initial Determination dated September 11, 1980, the award was affirmed, with a date of entitlement of April 1, 1979.

Quarto Mining Co. requested a formal hearing on this matter before an administrative law judge. On March 15, 1984, a formal hearing regarding Elba Bellomy's benefits award was held before an administrative law judge in Morgantown, West Virginia. At this hearing, Quarto Mining moved to be dismissed from liability under the Black Lung Benefits Amendment of 1981. That amendment, codified in pertinent part at 30 U.S.C. Sec. 932(c)(2), (j)(3), provides that liability for black lung benefits may be transferred from the employer to a trust fund administered by the Department of Labor in certain circumstances. Bellomy joined in this motion, and the hearing thereafter considered only the issue of Quarto Mining's liability. At the hearing, Bellomy testified that he had not received any notice from the Social Security Administration regarding his right to have his previously denied claims reconsidered pursuant to 30 U.S.C. Sec. 945.

The hearing was conducted without the presence of a representative of the Department of Labor. Consequently, on April 2, 1984, the administrative law judge issued an order granting the Director, Office of Workers' Compensation Programs, Department of Labor, twenty days in which to present evidence and argument regarding the applicability of the transfer provisions in the Black Lung Benefits Amendment of 1981. On April 10, 1984, the Director submitted an argument opposing transfer of liability but failed to offer any evidence either in support of that position or challenging Bellomy's assertion about his lack of notice. On May 19, 1984, Quarto Mining Co. filed a response brief noting the lack of any evidence by the Director which demonstrated that Bellomy received notice of his right to elect review of his previously denied claims. On May 22, 1984, the Director requested an additional twenty days to submit evidence in the form of a computer printout which listed the names of Bellomy and others and nothing more. There was no direct evidence that the card was ever mailed. When the Director was unable to carry its burden, the administrative law judge, on May 25, 1984, issued a Decision and Order.

The administrative law judge ruled that Bellomy never received an election card, therefore, "good cause" existed for his failure to respond to the election card because his failure to receive the card was due to a circumstance beyond his control or due to an unavoidable circumstance. Moreover, the fact that Bellomy filed a claim on April 6, 1979 indicated both that he was continuing to pursue his claims and that he would have filed an election had he in fact received a card. The administrative law judge then dismissed Quarto Mining Co. as the responsible operator and transferred liability to the Black Lung Disability Trust Fund, returning the case to the Deputy Commissioner for payment.

The Director appealed the administrative law judge's decision to the Benefits Review Board. The Director contended that the administrative law judge did not have the jurisdiction to make a "good cause" determination for failure to elect review. The Board rejected the Director's argument and affirmed the administrative law judge. From that decision, the Director appealed to this Court.

The Black Lung Benefits Act provides that no operator, here, Quarto Mining Co., shall be liable for a miner's death or disability due to black lung if that death or disability was the subject of a claim denied before March 1, 1978, provided that the claim has been approved in accordance with 30 U.S.C. Sec. 945. 30 U.S.C. Sec. 932(c). Liability for such approved claims is instead transferred to the Black Lung Disability Trust Fund. 30 U.S.C. Sec. 932(j)(3). The transfer provisions altered the liability for two types of denied claims which were reopened by the Black Lung Benefits Reform Act of 1977: those claims which had been filed with and denied by the Social Security Administration under Part B of the Act, and those claims which had been filed with and denied by the Department of Labor under Part C of the Act. 30 U.S.C. Sec. 945. 30 U.S.C. Sec. 945 provides that all claims denied prior to March 1, 1978 are eligible for reopening, but that such reopening is automatic only for Part C claims. Part B claimants, such as Bellomy, are required to request review of their claims, either with the Social Security Administration or the Department of Labor, as appropriate. 30 U.S.C. Sec. 945(a)(1)(A), (B).

The Code of Federal Regulations provides that for Part B claims:

No claim filed with and denied by the Social Security Administration is subject to the transfer of liability provisions unless a request was made by or on behalf of the claimant for review of such denied claim under section 435. Such review must have been requested by the filing of a valid election card or other equivalent document with the Social Security Administration in accordance with section 435(a) and its implementing regulations....

20 C.F.R. Sec. 725.496(d).

The Director claims that, because Bellomy failed to elect review under the Black Lung Benefits Act, and because his claim was not subject to automatic review, Quarto Mining is not entitled to transfer its liability for Bellomy's disability to the Black Lung Disability Trust Fund. The Director argues that the Black Lung Benefits Act requires the filing of a request for review as a precondition to liability transfer for any denied Part B claim. According to the Director, the date of the election card filing is critical because it determines the date of retroactive benefits absent evidence showing the specific date of the onset of the miner's disability.

The Director contends that the administrative law judge's finding that "good cause" existed for Bellomy's failure to file an election card is not tantamount to a triggering of review under the Black Lung Benefits Act. In essence, the Director argues that an excuse for not filing an election card is not a substitute for a specific request for review. The Code of Federal Regulations provides:

A request for review by the Social Security Administration ... must be received within 6 months from the date on which the notice is mailed.... If a request for review by the Social Security Administration ... is not received by the Social Security Administration within 6 months from the date the notice is mailed, the claimant shall be considered to have waived the right of review afforded by this Subpart G unless "good cause" may be established for not responding within this time period. "Good cause" may be established in the following situations:

(1) Circumstances beyond the individual's control, such as extended illness, mental, or physical incapacity, or communication difficulties; or

(2) Incorrect or incomplete information furnished by the individual the Social Security Administration; or

(3) Unusual or unavoidable circumstances, the nature of which demonstrate that the individual could not reasonably be expected to have been aware of the need to respond within this time period.

20 C.F.R. Sec. 10.704(d). The Director argues that the administrative law judge has allowed a claimant to elect review by merely not having waived the right to do so. In further support of this position, the Director contends that the legislative history of the 1981 amendments to the Black Lung Benefits Act supports the argument that a specific request for review must have been made in order for liability for that claim to have been transferred from the operator to the trust fund.

In order to not be swamped with cases as we once were, our scope of review in appeals from the Benefits Review Board is narrow. The administrative law judge hears the evidence and makes the findings of fact. The Board itself on review may only set aside an administrative law judge's findings of fact and conclusions of law if they are not supported by substantial evidence...