Malland v. State, Dept. of Retirement Systems

• Decision Date: 11 January 1985
• Docket Number: No. 50405-9,50405-9
• Court: Washington Supreme Court
• Parties: David V. MALLAND and Patrick Kuaimoku, Appellants, v. STATE of Washington, DEPARTMENT OF RETIREMENT SYSTEMS, Law Enforcement Officers & Firefighters Retirement Board, Respondents.

Page 484

103 Wn.2d 484

694 P.2d 16

David V. MALLAND and Patrick Kuaimoku, Appellants, v. STATE of Washington, DEPARTMENT OF RETIREMENT SYSTEMS, Law Enforcement Officers & Firefighters Retirement Board, Respondents.

No. 50405-9.

Supreme Court of Washington En Banc.

Jan. 11, 1985.

Reaugh & Prescott, J.E. Fischnaller, George E. Merker, Seattle, for malland.

Hans E. Johnsen, Seattle, for Kuaimoku.

Ken Eikenberry, Atty. Gen., Kathy Nolan, Donald F. Cofer, Asst. Attys. Gen., Olympia, Douglas Jewett, Seattle City Atty., Gordon Campbell, Asst. City Atty., Seattle, Linda Youngs, Bellevue City Atty., Richard L. Kirkby, Asst. City Atty., Bellevue, for respondents.

BRACHTENBACH, Justice.

These consolidated cases involve interpretation of the statutory scheme governing reexaminations of individuals granted disability retirement allowances under the Washington Law Enforcement Officers' and Fire Fighters' Retirement System Act (LEOFF). Appellants, a former Seattle police officer and a former Bellevue fire fighter, challenge the cancellations of their disability retirement allowances, arguing that such cancellations are improper absent a showing that the circumstances under which the allowances were originally granted have changed. We agree and hold that there must be some showing of a change of circumstances before a disability allowance may be canceled.

The facts of each case will be dealt with separately.

Malland

Appellant David Malland commenced employment as a Seattle police officer in March 1966. He was granted disability retirement effective November 1979 due to hearing problems.

RCW 41.26.130(5) and RCW 41.26.140 permit periodic reexaminations of LEOFF members who have been granted disability retirement allowances. Pursuant to these provisions, Malland was reexamined in 1982. The Seattle Police Pension Board determined Malland was no longer disabled and following a hearing, canceled his disability retirement allowance. Malland appealed to the Director of the Department of Retirement Systems (Director). The Director affirmed the local board, stating that a change or improvement in condition need not be proven because RCW 41.26 requires determinations of an individual's condition at different times.

Subsequently, a de novo hearing was held before an administrative law judge. At the administrative hearing, two medical doctors and an audiologist testified that Malland's condition had not improved since the original grant of disability. The experts, however, reached contrary conclusions on the central issue of whether Malland was still disabled. One doctor concluded Malland remained disabled. A second doctor, Dr. Sennewald, testified that Malland's condition did not prevent him from performing most of the functions of a police officer with average efficiency.

The administrative law judge concluded no change in medical condition need be shown to cancel a disability allowance but that Malland was still disabled. The Director agreed no change in condition need be proven, but concluded that Malland was not disabled. The Director therefore ordered cancellation of Malland's allowance.

Kuaimoku

Appellant Patrick Kuaimoku commenced employment as a Bellevue fire fighter in January 1969. Following a job-related back injury, Kuaimoku filed for disability retirement. The application was denied by the Bellevue Disability Board and the denial was affirmed by the State LEOFF Board. ¹ Kuaimoku appealed. Subsequently, in a March de novo administrative hearing, the hearing examiner concluded Kuaimoku was disabled from working as a firefighter and granted him a disability allowance. No appeal was taken from this order.

Subsequently, Kuaimoku was reexamined and, in 1979, the Bellevue Disability Board canceled his disability allowance. Kuaimoku appealed and a hearing de novo was conducted pursuant to RCW 41.26.220.

At the hearing, two doctors testified that there had been no substantial change in Kuaimoku's medical condition. A third doctor would not express an opinion on whether his condition had changed because he had not examined him at the time of the initial disability hearing. The two doctors who testified on behalf of the City of Bellevue concluded that Kuaimoku was not disabled. They based their opinion on the lack of objective signs of back injury. Kuaimoku's doctor, who had first examined Kuaimoku in 1975 in conjunction with the initial grant of disability, stated that Kuaimoku was disabled from working as a fire fighter. In his opinion Kuaimoku's subjective symptoms had improved somewhat because he had learned to take better care of his back.

The hearing examiner concluded Kuaimoku had failed to show he was still disabled. The trial court reversed and remanded, ruling that the burden of proof had been improperly placed on Kuaimoku.

On remand before a different hearing examiner, the parties stipulated to use of the record from the prior hearing. The new examiner found, inter alia, that "[a]t the time of reexamination, Kuaimoku's back injury, though slightly improved, was essentially the same as at the time Kuaimoku was initially granted a retirement allowance." He found that Kuaimoku was still disabled and proposed an order reversing the cancellation of disability. The State LEOFF Board did not adopt this proposed order, however, and affirmed the cancellation. The State Board's finding of fact 9 provided: "At the time of reexamination KUAIMOKU'S back injury had improved somewhat from the time he initially was granted a disability allowance."

Kuaimoku again appealed. The trial judge affirmed, ruling that the State Board's order was neither "arbitrary and capricious" nor "clearly erroneous". The judge concluded that no change in medical condition or other circumstances need be shown to justify cancellation of a disability allowance. The judge further stated that even if such a change was required, the record supported the Board's finding of improvement in condition.

I

The issue presented in this case is whether a LEOFF Retirement System disability allowance may be cancelled absent a showing that the circumstances upon which the original grant of disability was based have changed. The Department of Retirement argues that the issue of a claimant's continuing disability is to be determined de novo in a reexamination hearing, without reference to the initial determination of disability. We disagree.

Disability retirement may be granted only upon a finding by a Disability Board that the claimant's mental or physical condition disables the claimant from the further performance of his or her duties. RCW 41.26.120. This is not a finding of temporary disability. Separate provisions are made for temporary disability leaves. RCW 41.26.120. RCW 41.26.130(5) allows all members who were awarded disability allowances before July 26, 1981, to be reexamined twice a year. However, this provision does not allow the Department to relitigate the issues resolved in the initial disability hearing. On reexamination, the Department is instructed to determine whether the member is "still unable to perform his duties". (Italics ours.) RCW 41.26.140(1). Inquiry is focused on the continuing nature of the disability, thus implying that some change in circumstances must be shown before a disability allowance may be cancelled. The burden of proving such a change in circumstances rests with the Department.

This interpretation of the statutory scheme is consistent with the judicial principles of finality and fairness embodied in the doctrine of collateral estoppel. The doctrine of collateral estoppel, or issue preclusion, seeks to prevent relitigation of previously determined issues between the same parties, to promote judicial economy, and to prevent harassment of and inconvenience to litigants. State v. Dupard, 93 Wash.2d 268, 609 P.2d 961 (1980). Without the requirement that some change in circumstances be shown on reexamination, the Department would be allowed to relitigate the same issues resolved in the initial disability hearing after the time for appeal has elapsed.

The requirements for application of collateral estoppel are: (1) identical issues; (2) a final judgment on the merits; (3) the party against whom the plea is asserted must have been a party to or in privity with a party to the prior adjudication; and (4) application of the doctrine must not work an injustice on the party against whom the doctrine is to be applied. Rains v. State, 100 Wash.2d 660, 674 P.2d 165 (1983).

The Department argues that the doctrine of collateral estoppel should not apply. It reasons that identical issues are not present in both proceedings because the initial disability determination and the reexamination determination involve consideration of the claimant's medical condition at different times. We reject this argument. While evidence presented at the reexamination proceeding may describe the disability at a later point in time, if the disability is unchanged and there is no change in job requirements or the law governing disabilities, the difference in time periods is irrelevant. As recognized in the Restatement (Second) of Judgments § 27, comment c (1982), preclusion doctrines may apply despite temporal disparities:

Sometimes, there is a lack of total identity between the matters involved in the two proceedings because the events in suit took place at different times. In some such instances, the overlap is so substantial that preclusion is plainly appropriate.... [I]n the absence of a showing of changed circumstances, a determination that, for example, a person was disabled ... in one year will be conclusive with respect to the next as well.

The remaining requirements for application of collateral estoppel are satisfied. The initial determination of disability is a final judgment, the local disability boards and the Department are parties in both proceedings, and no injustice will result from application of collateral estoppel.

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