In re Vazquez

• Citation: 65 N.E.3d 30 (Table),90 Mass.App.Ct. 1117
• Decision Date: 23 November 2016
• Docket Number: No. 16–P–186.,16–P–186.
• Parties: Ricardo VAZQUEZ'S CASE.
• Court: Appeals Court of Massachusetts

90 Mass.App.Ct. 1117

65 N.E.3d 30 (Table)

Ricardo VAZQUEZ'S CASE.

No. 16–P–186.

Appeals Court of Massachusetts.

November 23, 2016.

MEMORANDUM AND ORDER PURSUANT TO RULE 1:28

Once again, we are presented with an appeal involving Attorney James N. Ellis, Sr., and Ellis and Associates (collectively, Ellis), and attorney's fees under the Workers' Compensation Act.² We affirm.

Background. 1. Prior proceedings. In 2007, Ricardo Vazquez (employee), represented by Ellis, filed a claim for specific compensation benefits under G.L. c. 152, § 36(1)(e) (§ 36 ). On May 17, 2007, an order of payment entered (2007 order). The 2007 order expressly allowed the insurer to withhold the employee's share of attorney's fees pursuant to G.L. c. 152, § 13A(10) ( § 13A [10] ), and 452 Code Mass. Regs. § 1.02 (1997) (CMR § 1.02).

The employee appealed from the 2007 order for a hearing before an administrative judge (AJ) of the Department of Industrial Accidents (DIA). As relevant to the instant appeal, the employee sought penalties pursuant to G.L. c. 152, § 8(1) (§ 8 ), and G.L. c. 152, § 14(1) (§ 14 ), for the insurer's withholding of sums under the 2007 order. The AJ affirmed the 2007 order. He also denied the employee's request for penalties, holding that the insurer's withholding of sums was permitted because § 13A(10) and CMR § 1.02 apply to claims under § 36. A DIA reviewing board (board) affirmed this holding, and the board's decision was affirmed by a different panel of this court in a memorandum and order issued pursuant to our rule 1:28. Vazquez's Case, 78 Mass.App.Ct. 1112 (2010)(Vazquez I ). On January 3, 2011, a rescript in Vazquez I issued.

2. Instant action. On July 30, 2013, the Supreme Judicial Court decided that § 13A(10) does not apply to § 36 awards and that the language in CMR § 1.02 suggesting otherwise is void. Spaniol's Case, 466 Mass. 102, 108, 111 (2013). On October 21, 2013, Ellis brought a claim against the insurer "on behalf of the employee, whose present whereabouts are unknown," for payment of the amounts withheld from the 2007 order. Ellis also sought penalties against the insurer, pursuant to §§ 8 and 14, and certification of a class of employees whose § 36 awards were reduced pursuant to § 13A(10) and CMR § 1.02. The claim was not signed by the employee but by Ellis and a representative in his office. On November 4, 2013, the insurer paid the withheld amounts, plus interest from May, 2007, through November, 2013.

Payment notwithstanding, Ellis pursued the claim for penalties under §§ 8 and 14. After a hearing, the same AJ who had affirmed the 2007 order denied Ellis's request for class certification and concluded that Ellis's penalties claim is barred by res judicata. He also found that Ellis brought the claim without reasonable grounds because he did not have the employee's consent or participation, and he assessed against Ellis "the whole cost of the proceedings." The board summarily affirmed the AJ's decision, and from that decision, Ellis brings the instant appeal. See G.L. c. 152, § 12 ; Merchants Ins. Group v. Spicer, 88 Mass.App.Ct. 262, 267 (2015).

Discussion. 1. The merits. Because the board summarily affirmed the AJ's decision, we review the AJ's findings and conclusions "in accordance with the standards set forth in G.L. c. 30A, § 14(7)(a)-(d), (f), and (g)." Sikorski's Case, 455 Mass. 477, 479 (2009). See Eady's Case, 72 Mass.App.Ct. 724, 725–726 (2008). "We may reverse or modify the board's decision where, among other reasons, it is based on an error of law, or is arbitrary, capricious, or otherwise not in accordance with the law." Spaniol's Case, supra at 106.

Here, the AJ correctly concluded that Ellis's claim is barred by res judicata.³ The judgment in Vazquez I became final when the rescript issued. See Mass.R.A.P. 1(c), as amended, 454 Mass. 1601 (2009); Foxworth v. St. Amand, 457 Mass. 200, 206–207 (2010). The question of an insurer's ability to withhold payment from § 36 benefits pursuant to § 13A(10) and CMR § 1.02 was "actually litigated [by Ellis on behalf of the employee] in the prior action," Kobrin v. Board of Registration in Med., 444 Mass. 837, 844 (2005), and res judicata "bars further litigation of" that matter. Heacock v. Heacock, 402 Mass. 21, 23 (1988). "This is so even though [Ellis] is prepared in [this] action to present different ... legal theories" arising out the holding in Spaniol's Case. Ibid.

We agree with the AJ that Ellis litigated the underlying claim and appeal without "reasonable grounds," G.L. c. 152, § 14, as appearing in St.1991, c. 398, § 36, as there is no evidence that the employee knew of or authorized filing of the claim. The AJ, who noted that the employee did not sign the claim, was not required to credit partially executed documents from 2005, or Ellis's bare assertions that he had the employee's permission to initiate and pursue the claim and appeal. See Pilon's Case, 69 Mass.App.Ct. 167, 169 (2007) ("Findings of fact, assessments of credibility, and determinations of the weight to be given the evidence are the exclusive function of the administrative judge"). The employee was not entitled to penalties, as the 2007 order specifically allowed the insurer to withhold sums pursuant to § 13A(10) and CMR § 1.02, see Johnson's Case, 69 Mass.App.Ct. 834, 839 (2007), and, for the same reason, the insurer's withholding of payment was not "without reasonable grounds." DiFronzo's Case, 459 Mass. 338, 343 (2011) (setting forth standard for "reasonable grounds" under § 14 ). Ellis presented no "fair question of law" regarding the insurer's failure to pay sums withheld pursuant to the 2007 order where further appellate review in Vazquez I was not sought, and his appeal had no "plausibility" once the payments were in fact made one month after the claim was filed. Ibid.

2. Requests for fees. We allow the insurer's request for sanctions pursuant to Mass.R.A.P. 25, as appearing in 376 Mass. 949 (1979), because we agree that Ellis again has pursued a frivolous appeal.⁴ While the holding in Spaniol's Case may apply retroactively,⁵ see Tucker v. Badoian, 376 Mass. 907, 918 (1978) (Kaplan, J., concurring) ("Ordinarily a change of decisional law falls into place and is applied to past as well as to subsequent transactions or occurrences"); Murphy's Case, 84 Mass.App.Ct. 1110 (2013) (applying holding in Spaniol's Case to direct appeal from 2009 award), it cannot be "regarded as in any way benefiting or reviving" the employee's earlier §§ 8 and 14 claims where final judgment on those claims had entered. Bouchard v. DeGagne, 368 Mass. 45, 49 (1975). Ellis's appeal bore "not ‘a prayer of a chance’ " where the principles of res judicata are well settled. Tamber v. Desrochers, 45 Mass.App.Ct. 234, 237 (1998), quoting from Pires v. Commonwealth, 373 Mass. 829, 838 (1977). See Avery v. Steele, 414 Mass. 450, 455 (1993), quoting from Allen v. Batchelder, 17 Mass.App.Ct. 453, 458 (1984) ("An appeal is frivolous ‘[w]hen the law is well settled, when there can be no reasonable expectation of a reversal’ ").

Conclusion. The decision of the board is affirmed. Ellis's request for attorney's fees and costs is denied. The insurer is invited to file a verified and itemized application for fees and costs within fourteen days of the date of the rescript. Ellis will have fourteen days thereafter in which to file any opposition to the amounts requested. See Fabre v. Walton, 441 Mass. 9, 10 (2004).

So ordered.

2 "In the past five years alone, Ellis or his legal assistants (collectively, Ellis) have filed over one hundred and fifty workers' compensation appeals in this court." Ellis v. Commissioner of the Dept. of Industrial Accs., 88 Mass.App.Ct. 381, 382 (2015). "Ellis's attorney's fees and expenses frequently have been the main subject in these appeals. In a series of these cases, Ellis has been sanctioned for filing frivolous appeals and, similarly, for presenting frivolous claims involving fees and expenses before the department" (footnote omitted). Id. at 382–383.

3 Thus, we need not address the denial of Ellis's motion for class certification.

4 See, e.g., Ellis v. Department of Industrial Accs., 463 Mass. 541, 544 (2012) ; Kendrick's Case, 76 Mass.App.Ct. 1129 (2010) ; Continental Ins. Co. v. Ellis, 82 Mass.App.Ct. 1101 (2012) ; Rivera's Case, 87 Mass.App.Ct. 1134 (2015) ; Olivenza's Case, 87 Mass.App.Ct. 1130 (2015) ; Santelli's Case, 90...