Johnson v. Workers' Comp. Appeals Bd.

• Decision Date: 19 November 1984
• Citation: 689 P.2d 1127,37 Cal.3d 235,207 Cal.Rptr. 857
• Court: California Supreme Court
• Parties: , 689 P.2d 1127 Arthur E. JOHNSON, Petitioner, v. WORKERS' COMPENSATION APPEALS BOARD, Trans World Airlines, Inc., et al., Respondents. L.A. 31928.

Page 857

207 Cal.Rptr. 857

37 Cal.3d 235, 689 P.2d 1127

Arthur E. JOHNSON, Petitioner, v. WORKERS' COMPENSATION APPEALS BOARD, Trans World Airlines, Inc., et al., Respondents.

L.A. 31928.

Supreme Court of California,

In Bank.

Nov. 19, 1984.

Howard N. Lehman, Rose, Klein & Marias, Los Angeles, for petitioner.

William Donohoe, Workers' Compensation Appeals Bd., San Francisco, Morrow, Nistler, Whitehead & Floyd, Westlake Village, Stockwell, Gleason, Anderson & Harris, Beverly Hills, Janet Brath, Hartford Acc. & Indem. Co., Los Angeles, for respondents.

BIRD, Chief Justice.

Is the Workers' Compensation Appeals Board precluded by Labor Code section 5811 from awarding printing costs incurred by an employee in answering a petition for writ of review summarily denied by an appellate court?

I.

Petitioner, Arthur E. Johnson, sustained work-related back injuries in 1972 and 1977 while employed as a ramp serviceman for respondent, Trans World Airlines, Inc. In July of 1977, Johnson filed applications with the Workers' Compensation Appeals Board (WCAB or board) for adjudication of his claims for permanent disability compensation benefits arising from the two injuries. Both applications named Trans World Airlines as a defendant. In addition, Liberty Mutual Insurance Company was named as a defendant in the application relating to the 1972 injury. Respondent, Hartford Accident and Indemnity Company (Hartford), was named as a defendant in the second application, which dealt with the 1977 injury.

In October of 1981, the workers' compensation judge issued separate awards of permanent disability indemnity on the two claims. In arriving at the award for the 1977 injury, the judge found that Hartford had unreasonably delayed paying Johnson a portion of the compensation owed. Pursuant to Labor Code section 5814, ¹ the judge assessed a penalty against Hartford equal to 10 percent of the delayed amount.

Johnson filed a timely petition for reconsideration, challenging the findings and awards on two grounds. Johnson contended that the record did not support the findings that the two injuries should be compensated separately because they occurred at different times. (See § 4750.) He argued that the injuries became permanent at the same time, so he was entitled to a single award for the combined disability. (See Wilkinson v. Workers' Comp. Appeals Bd. (1977) 19 Cal.3d 491, 494, 138 Cal.Rptr. 696, 564 P.2d 848.)

Further, Johnson argued that the 10 percent penalty against Hartford for unreasonable delay should have been assessed against the entire award rather than the delinquent portion. (See § 5814, ante, fn. 1.)

On January 11, 1982, a three-member panel of the board issued its Opinion and Order Granting Reconsideration and Decision after Reconsideration. The decision granted the relief requested by Johnson. ²

Hartford filed a petition for writ of review in the Court of Appeal. Johnson filed an answer. In his answer, he requested a remand to the board for an award of attorney fees incurred in opposing the petition. (See § 5801. ³ ) The Court of Appeal summarily denied the petition for writ of review and the request for attorney fees.

Johnson's answer was printed in accordance with California Rules of Court, rule 15(b). The total cost was $531.93. After the denial in the Court of Appeal, Johnson applied to the board for reimbursement of the cost of printing his answer. The board denied the application and Johnson's petition for reconsideration on the basis it lacked jurisdiction to award costs incurred in judicial proceedings.

Johnson filed a petition for writ of review and requested the Court of Appeal to order Hartford to reimburse him for the printing costs. In the alternative, he asked that the matter be remanded to the board with instructions to make the award. On June 1, 1984, the Court of Appeal summarily denied the petition. This petition for writ of review followed.

II.

As a general rule, the WCAB is authorized to award costs. Section 5811 provides in pertinent part: "In all proceedings under this division before the appeals board, costs as between the parties may be allowed by the appeals board." The issue in this case is whether section 5811 gives the WCAB authority to award reasonable costs incurred by an employee in answering an employer's or compensation carrier's petition for writ of review following summary denial of the petition by an appellate court. ⁴

This question has been addressed only once, in dictum contained in a footnote in the case of Employers Mut. Liab. Ins. Co. v. Workmen's Comp. Appeals Bd. (1975) 46 Cal.App.3d 104, 120 Cal.Rptr. 48 (hereinafter Rodriguez ). In Rodriguez, the Court of Appeal stated that "[t]he provisions of section 5811, which permit the board to allow costs as between the parties in proceedings 'before the appeals board,' are not applicable to appellate proceedings." (46 Cal.App.3d at p. 108, fn. 2, 120 Cal.Rptr. 48.) The court offered no analysis in support of this dictum.

To assess the accuracy of the Rodriguez court's statement, it is helpful to survey the history of WCAB practices in this area. Until 1971, the WCAB routinely defended its awards against petitions for review. Hence, the availability of appellate costs to an injured employee was not a significant problem. However, in 1971, the WCAB adopted a new policy under which it no longer answered such petitions unless they challenged WCAB procedures or policies. (See Cal.Workmen's Compensation Practice (Cont.Ed.Bar 1973) §§ 11.52, 11.53, p. 382.)

This change in policy left employees to defend their own awards against petitions filed by employers or compensation carriers. This is the policy in effect today.

An injured worker who fails to file an answer "runs the risk that the court will assume the petitioner's statement of facts is accurate and the contentions have merit." (Cal.Workmen's Compensation Practice, supra (Cont.Ed.Bar Supp.1982) § 11.52, p. 154, citing State Farm Fire & Casualty Co. v. Workers' Comp. Appeals Bd. (1981) 119 Cal.App.3d 193, 197-198, 173 Cal.Rptr. 778.) Of course, an employee who files an answer to ensure that his or her contentions are brought to the court's attention incurs additional costs. Whether the employee who prevails will be able to recover those costs turns on whether the appellate court summarily denies the petition for writ of review or issues a writ and files an opinion favoring the employee. That circumstance is beyond the employee's power to influence.

An appellate court normally awards costs through the issuance of a remittitur. (See Cal.Rules of Court, rule 26(b); Code Civ.Proc., § 1027; Arp v. Workers' Comp. Appeals Bd. (1977) 19 Cal.3d 395, 411, 138 Cal.Rptr. 293, 563 P.2d 849; Ulrich v. Workmen's Comp. Appeals Bd. (1975) 50 Cal.App.3d 643, 653, 123 Cal.Rptr. 435.) However, the vast majority of petitions for writ of review in WCAB cases are summarily denied without remittitur. ⁵ No mechanism exists for an appellate court to award costs to the prevailing employee when it summarily dismisses an employer's petition. (See 5 Witkin, Cal.Procedure (2d ed. 1971) Extraordinary Writs, § 175, p. 3937.)

The board quickly recognized the problem created by its 1971 policy change. A forum was needed in which an employee could recover costs incurred in answering a petition which the reviewing court summarily denied. Accordingly, in 1972, the board for the first time awarded appellate costs. (DeWall v. Ford Motor Co. (1972) 70 ING 11842.) In its opinion, the board concluded that "where the employer or carrier is the Petitioner, and where the Board has not appeared and answered the petition, ... the respondent employee should ordinarily be awarded costs of defending against the Petition for Writ of Review as an incident of the costs of proceedings before the Appeals Board." (Ibid.)

Following its decision in DeWall, the board occasionally awarded appellate costs when the issue was raised. ⁶ However, this practice was ended in 1975 because the board believed such awards were precluded by the Rodriguez dictum.

Article XIV, section 4 of the California Constitution provides, in part: "The Legislature is hereby expressly vested with plenary power, unlimited by any provision of this Constitution, to create, and enforce a complete system of workers' compensation ... [which] includes ... full provision for vesting power, authority and jurisdiction in an administrative body with all the requisite governmental functions to determine any dispute or matter arising under such legislation, to the end that the administration of such legislation shall accomplish substantial justice in all cases expeditiously, inexpensively, and without incumbrance of any character; all of which matters are expressly declared to be the social public policy of this State, binding upon all departments of the State government." (Emphasis added.)

This constitutional provision supports petitioner's contention that the WCAB should have the authority to award appellate costs. If injured workers were not permitted to recover costs incurred in successfully answering a petition for writ of review, the constitutional policy to ensure substantial justice "without incumbrance of any character" would be frustrated. Forcing employees to absorb such costs would diminish the minimal awards obtained under the Workers' Compensation Act ( § 3200 et seq.). It would also render the appellate review component of the law's administration impermissibly expensive.

Further, permitting the WCAB to award appellate costs after the summary denial of a petition for writ of review is consistent with the language of section 5811. That section refers to costs incurred in proceedings "before the appeals board." Technically, proceedings remain before the board and subject to its jurisdiction unless and until this court or the Court of Appeal grants a petition for writ of review. ⁷ Where, as here, the appellate court summarily denies the ...