Frito-Lay v. Utah Labor Com'n

• Decision Date: 03 November 2009
• Docket Number: No. 20080818.,20080818.
• Citation: 2009 UT 71,222 P.3d 55
• Parties: FRITO-LAY and Transcontinental Insurance Company, Petitioners, v. UTAH LABOR COMMISSION and Amy C. Clausing, Respondents.
• Court: Utah Supreme Court

222 P.3d 55

2009 UT 71

FRITO-LAY and Transcontinental Insurance Company, Petitioners, v. UTAH LABOR COMMISSION and Amy C. Clausing, Respondents.

No. 20080818.

Supreme Court of Utah.

November 3, 2009.

Theodore E. Kanell, John H. Romney, Salt Lake City, for petitioners.

Alan L. Hennebold, Salt Lake City, for respondent, Utah Labor Commission.

Gary E. Atkin, K. Dawn Atkin, Salt Lake City, for respondent, Amy C. Clausing.

On Certiorari to the Utah Court of Appeals.

INTRODUCTION

DURRANT, Associate Chief Justice:

¶ 1 This appeal arises from Amy Clausing's claim against Frito-Lay and its insurance carrier, Transcontinental Insurance Co. (collectively, "Frito-Lay"), for temporary disability compensation under the Utah Workers' Compensation Act. It raises three issues that we must resolve: (1) whether the Utah Rules of Civil Procedure, and specifically rule 60, are applicable to administrative proceedings; (2) whether the Utah Labor Commission has statutory authority similar to the authority a district court would have under rule 60 to modify a former order; and (3) whether the court of appeals erred in addressing Frito-Lay's arguments under rule 60(a) or the discovery rule.

BACKGROUND

¶ 2 Clausing worked for Frito-Lay as a route sales representative. On March 18, 1999, she was injured when a pallet of Frito-Lay products fell on her while she was restocking a retail store display.

¶ 3 In 2001 and 2003, she filed applications for workers' compensation benefits relating to injuries she incurred in 1999. The 2001 application resulted in a settlement agreement and subsequent award of permanent partial disability payments and medical expenses.

¶ 4 After finalizing the settlement, Clausing suffered a neck injury and a stroke, which she contended were caused by the 1999 accident. She also alleged continuing knee, elbow, and lower back pain. Thus, on July 17, 2003, she again applied for compensation for injuries relating to the 1999 accident. For purposes of adjudicating the 2003 application, the parties stipulated to facts regarding Clausing's salary and work history between 1999 and 2004.

¶ 5 On September 23, 2005, an Administrative Law Judge ("ALJ") for the Utah Labor Commission ("Commission") entered an order that included, in part, temporary total disability ("TTD") benefits. The order specified a weekly TTD benefit of $487 for the period between March 18, 1999, and June 10, 2004. Although the order provided for offsets of amounts previously paid to Clausing and incorporated the stipulation of facts, it did not specifically acknowledge the parties' stipulation that Clausing had worked during substantial portions of the period encompassed by the order. Nor did it specify offsets for time worked.

¶ 6 Neither party appealed the order before the 30-day deadline provided by the Utah Administrative Procedures Act ("UAPA").¹ But on December 1, 2005, Clausing demanded payment for the entire period covered by the September 23 order, an award totaling $123,061.20. On December 6, 2005, Frito-Lay responded, stating that "no outstanding compensation" remained to be paid. Frito-Lay later recalculated the amount and determined it owed $4,451.18, which breaks down to $487 per week for 9.14 weeks—the number of weeks Clausing did not work between March 18, 1999, and June 10, 2004.

¶ 7 On December 20, 2005, Clausing filed an Abstract of Award, which set forth her belief that she had been awarded $183,561.85, representing 190.88 weeks at $487, plus interest. The next day, Frito-Lay filed a motion under rule 60(b) of the Utah Rules of Civil Procedure seeking relief due to surprise, mistake, and excusable neglect. Frito-Lay argued that it was entitled to relief because both parties were mistaken as to the effect of the September 23 order. Frito-Lay claimed that, in light of the stipulation, neither party anticipated the order would award payment of $487 per week for all weeks between March 18, 1999, and June 10, 2004. Further, Frito-Lay argued that, until Clausing filed her abstract of award on December 20, 2005, it did not realize that Clausing interpreted the order to require such payment.

¶ 8 In opposition to the rule 60(b) motion, Clausing argued that rule 60(a) would have been a more appropriate rule under which Frito-Lay could have sought relief because the order did not reflect the conclusion the parties understood the ALJ to have reached at the hearing.

¶ 9 On March 17, 2006, the ALJ issued an amended order, stating that the 60(b) motion was denied because (1) there were insufficient grounds to support it; (2) under UAPA, it was an untimely appeal of the September 23 order; and (3) UAPA does not grant the Commission authority to review the 60(b) motion.

¶ 10 Frito-Lay sought further administrative review, and the Commission's Appeals Board ("Appeals Board") also dismissed Frito-Lay's rule 60(b) motion. The Appeals Board determined that rule 60(b) is not applicable to administrative proceedings before the Commission. Rather, the sole avenue for relief is found in UAPA, which specifies that review of ALJ decisions must be sought within thirty days.²

¶ 11 Frito-Lay appealed the Appeals Board's decision to the Utah Court of Appeals. A panel majority of the court of appeals determined that there was nothing in the applicable statutes "that would prohibit modification of an order under rule 60."³ Rather, UAPA "merely grants administrative agencies the power to have internal appellate review of ALJ orders" within thirty days, and section 63-46b-13⁴ establishes "a method of review" of an order in the absence of an established appeals process.⁵ But because a rule 60 motion is distinct from a motion for review, the panel majority found "nothing in [UAPA] that would prohibit" granting relief under rule 60.⁶ The panel majority also determined that "rule 60(a) may also be applicable" to the extent any omission in the September 23 order could be viewed as a clerical error.⁷ Finally, the panel majority addressed Frito-Lay's alternative argument, apparently raised for the first time on appeal, that the discovery rule should have been applied to toll the time for seeking review under Utah Code sections 63G-4-301 or -302.⁸ Reasoning that Frito-Lay could not, through reasonable efforts, have discovered that Clausing would demand awards for days that she admitted she was able to or did actually work, the panel majority determined that the discovery rule tolled the filing deadline, making Frito-Lay's rule 60(b) motion a timely request for administrative review.⁹

¶ 12 Judge Thorne dissented. He first contended that the panel majority not only improperly considered rule 60(a) where Frito-Lay had not raised it as a distinct issue on appeal, but also that the majority erred in its determination that the September 23 order's omission constituted a clerical error. Then, as to the panel majority's rule 60(b) analysis, Judge Thorne noted that "UAPA has expressly incorporated the Utah Rules of Civil Procedure in just two areas, discovery and default."¹⁰ And he recognized that "in [all] other areas including the substantive review of agency orders, UAPA [establishes] procedures that are unique to the agency context."¹¹ Accordingly, Judge Thorne agreed with the Appeals Board's determination that Frito-Lay had waived its available remedies under UAPA by failing to appeal within the 30-day deadline set by UAPA.¹² He also found the cases cited by the panel majority distinguishable because they applied to "situations where newly discovered facts warrant a change in an existing order."¹³ Finally, he disagreed that application of the discovery rule would have resulted in a timely challenge to the September 23 order.¹⁴

¶ 13 We granted certiorari to determine whether the court of appeals erred in holding rule 60 of the Utah Rules of Civil Procedure applicable to the Commission's adjudicative proceedings or in addressing Frito-Lay's arguments under rule 60(a) and the discovery rule.

¶ 14 We have jurisdiction to review the court of appeals' decision pursuant to Utah Code section 78A-3-102(3)(a) (2008).

STANDARD OF REVIEW

¶ 15 On certiorari, we review the decision of the court of appeals for correctness and give no deference to its legal conclusions.¹⁵

ANALYSIS

¶ 16 The parties and the court of appeals agree that the legislature has not incorporated rule 60 of the Utah Rules of Civil Procedure into either UAPA or the statutes governing the Commission's administrative adjudications. Despite the legislature's decision not to incorporate rule 60, the panel majority of the court of appeals held that rule 60 is applicable in workers' compensation proceedings conducted by the Commission¹⁶ and that the Appeals Board should have applied rule 60(a), rule 60(b), and/or the discovery rule to modify the September 23 order.¹⁷ We address each of these holdings in turn and conclude that (1) the Utah Rules of Civil Procedure are inapplicable to administrative proceedings unless the legislature has specifically incorporated them, in whole or in part, by statute; (2) although rule 60 is inapplicable in this case, the Commission has statutory authority that grants it the same substantive authority that state and local courts are granted under rule 60; and (3) the issue of whether the court of appeals erred in addressing rule 60(a) or the discovery rule is moot in light of our determination that the Commission's statutory authority is sufficient to address the merits of Frito-Lay's motion. Accordingly, we reverse the court of appeals' decision and remand this case to the Appeals Board to reconsider Frito-Lay's motion under the Commission's statutory grant of authority.

I. THE UTAH RULES OF CIVIL PROCEDURE ARE INAPPLICABLE TO ADMINISTRATIVE PROCEEDINGS UNLESS EXPRESSLY INCORPORATED BY STATUTE

¶ 17 The Utah Constitution empowers and requires this court to "adopt rules of procedure and evidence to be used in the courts of the state and . . . by rule manage the appellate...