Neal v. Annett Holdings, Inc.

• Decision Date: 02 May 2012
• Docket Number: No. 10–2117.,10–2117.
• Citation: 814 N.W.2d 512
• Parties: Tim NEAL, Appellant, v. ANNETT HOLDINGS, INC., Appellee.
• Court: Iowa Supreme Court

814 N.W.2d 512

Tim NEAL, Appellant,

v.ANNETT HOLDINGS, INC., Appellee.

No. 10–2117.

Supreme Court of Iowa.

March 2, 2012.

Rehearing Denied May 2, 2012.

Christopher D. Spaulding of Berg, Rouse, Spaulding & Schmidt, P.L.C., Des Moines, for appellants.

Charles A. Blades and Sasha L. Monthei of Scheldrup Blades Schrock Smith Aranza, PC, Cedar Rapids, for appellee.

APPEL, Justice.

In this case, we must determine whether the Workers' Compensation Commissioner (commissioner) erred in concluding that light duty employment offered to an injured worker was not “suitable work” under Iowa Code section 85.33(3) (2009) because the offered employment was located 387 miles from the residence of the worker. We also must address whether substantial evidence supports the commissioner's finding that the employee suffered a sixty percent industrial disability as a result of an on-the-job injury. The district court reversed the commissioner's ruling on the “suitable work” issue, but affirmed the commissioner's ruling on industrial disability. For the reasons expressed below, we reverse the district court on the “suitable work” issue, but affirm the district court on the issue of industrial disability.

I. Factual and Procedural Background.

TMC Transportation, a division of Annett Holdings, employed Tim Neal as an over-the-road flatbed truck driver. In September 2007, Neal was sent to Michigan to pick up a load of plywood. A forklift driver loaded Neal's flatbed with the plywood in three stacks and left tarps on top of the load. In an effort to secure the tarps, Neal climbed onto the flatbed and, as he was lifting himself onto the first stack, injured his shoulder.

An MRI scan of Neal's shoulder revealed a partial full thickness tear of the rotator cuff, tendinopathy and thickening of the rotator cuff, and hypertrophic change of the AC joint. Due to the injury, Neal's doctor imposed work restrictions including limitations on the amount of weight Neal could lift. TMC offered Neal light-duty work in Des Moines, Iowa.

At the time, Neal resided with his wife and three children in Grayville, Illinois. Grayville is 387 miles from Des Moines. TMC offered to provide Neal a motel room while Neal worked in Des Moines. TMC also stated it would provide Neal transportation costs to allow Neal to return to Grayville every other weekend. According to Neal, if he were to participate in TMC's light-duty program he could return home every other week to see his family. Before the injury, Neal returned home every weekend and occasionally during the week.

Neal declined TMC's offer to perform light-duty work in Des Moines. As a result, TMC suspended Neal's workers' compensation benefits.

In February 2009, an arbitration hearing was held on Neal's workers' compensation claim. In the arbitration decision, the deputy commissioner concluded Annett Holdings properly suspended temporary disability benefits because Neal refused to accept “suitable work” as defined in Iowa Code section 85.33(3). The deputy commissioner also concluded Neal experienced a fifteen percent permanent partial disability.

Neal appealed the arbitration decision. Neal argued Annett Holdings failed to offer “suitable work” because the work was located 387 miles from Neal's residence. Neal also challenged the finding of a fifteen percent permanent partial disability.

On appeal, the commissioner ¹ modified the arbitration decision. Specifically, the commissioner concluded Annett Holdings failed to offer “suitable work” because the job was located a great distance from Neal's residence. The commissioner observed that Neal could return home only every other weekend, whereas prior to the injury he could return home every weekend. The commissioner reasoned a worker should not be required to uproot and move to a different location, observing that “[b]eing away from the support of your wife and family, especially while recovering from a serious work injury, is not an insignificant matter.” The commissioner also found Neal suffered from a sixty percent industrial disability. Annett Holdings filed a motion to reconsider, which the commissioner denied. Annett Holdings petitioned for judicial review.

The district court affirmed in part and reversed in part. The district court affirmed the commissioner's finding that Neal suffered a sixty percent industrial disability. The district court reversed, however, on the issue of whether Annett Holdings offered suitable work. The district court stated Iowa Code section 85.33(3) “does not define ‘suitable work’ in terms of its location; rather, ‘suitable work’ is that which is ‘consistent with the employee's disability.’ ” Because Annett Holdings offered light-duty work consistent with Neal's disability, the district court concluded that Neal refused suitable work and thus, forfeited his right to temporary partial, temporary total, and healing period benefits during his period of refusal. Neal appealed, and Annett Holdings cross-appealed.

II. Standard of Review.

Judicial review of the decisions of the workers' compensation commissioner is governed by Iowa Code chapter 17A. Mycogen Seeds v. Sands, 686 N.W.2d 457, 463 (Iowa 2004). A district court acts in an appellate capacity when it exercises its judicial review power. Id. When reviewing a district court's decision “we apply the standards of chapter 17A to determine whether the conclusions we reach are the same as those of the district court. If they are the same, we affirm; otherwise, we reverse.” Id. at 464 (citation omitted).

In this case, we are asked to consider whether the commissioner erred in concluding that Annett Holdings failed to offer suitable work for purposes of Iowa Code section 85.33(3). To the extent the commissioner's decision reflects factual determinations that are “clearly vested by a provision of law in the discretion of the agency,” we are bound by the commissioner's findings of fact if they are supported by substantial evidence. Schutjer v. Algona Manor Care Ctr., 780 N.W.2d 549, 557 (Iowa 2010) (citation and internal quotation marks omitted); Meyer v. IBP, Inc., 710 N.W.2d 213, 219 (Iowa 2006). Further, the commissioner's application of law to the facts as found by the commissioner will not be reversed unless it is “irrational, illogical, or wholly unjustifiable.” Lakeside Casino v. Blue, 743 N.W.2d 169, 173 (Iowa 2007) (citation and internal quotation marks omitted).

The question of whether an employer offered suitable work is ordinarily a fact issue. See Schutjer, 780 N.W.2d at 557, 559;McCormick v. N. Star Foods, Inc., 533 N.W.2d 196, 199 (Iowa 1995). Whether the commissioner considered an improper factor in reaching its factual determination regarding suitability, however, is a question of law. Cf. Pac. Mills v. Dir. of Div. of Emp't Sec., 322 Mass. 345, 77 N.E.2d 413, 415 (Mass.1948).

With respect to questions of law, we have stated that no deference is given to the commissioner's interpretation of law because the “interpretation of the workers' compensation statutes and related case law has not been clearly vested by a provision of law in the discretion of the agency.” Schutjer, 780 N.W.2d at 558 (citation and internal quotation marks omitted). Shortly after Schutjer, this court decided Renda v. Iowa Civil Rights Commission, 784 N.W.2d 8 (Iowa 2010), which clarified and refined our approach to determining whether an agency has been delegated the authority to interpret a statute.

In Renda, we explained that “each case requires a careful look at the specific language the agency has interpreted as well as the specific duties and authority given to the agency with respect to enforcing particular statutes.” Renda, 784 N.W.2d at 13. We give deference to the agency's interpretation if the agency has been clearly vested with the discretionary authority to interpret the specific provision in question. Id. at 11. If, however, the agency has not been clearly vested with the discretionary authority to interpret the provision in question, we will substitute our judgment for that of the agency if we conclude the agency made an error of law. Id. at 14–15. Deference may be given to an agency's interpretation in a specific matter or an interpretation embodied in an agency rule. Sherwin–Williams Co. v. Iowa Dep't of Revenue, 789 N.W.2d 417, 422–23 (Iowa 2010). Indications that the legislature has delegated interpretive authority include “rule-making authority, decision-making or enforcement authority that requires the agency to interpret the statutory language, and the agency's expertise on the subject or on the term to be interpreted.” Id. at 423.

We conclude the legislature did not vest the authority to interpret the phrase “suitable work” for purposes of Iowa Code section 85.33(3) in the workers' compensation commission. First, the legislature has made no explicit grant of interpretive authority to the commission. See Renda, 784 N.W.2d at 11. Second, while we recognize Iowa Code section 86.8(1) creates in the commissioner a duty to “[a]dopt and enforce rules necessary to implement ... chapters 85, 85A, 85B, [86,] and 87,” the mere grant of rulemaking authority does not give an agency authority to interpret all statutory language. Renda, 784 N.W.2d at 13–14. Third, as discussed below, the concept of “suitable work” is found in similar contexts, including employment discrimination, wrongful termination, unemployment compensation, and the odd-lot doctrine. Therefore, we are not convinced “suitable work” is a specialized phrase within the expertise of the commissioner; rather, the phrase has a specialized legal meaning extending beyond the context presented in this case. Id. at 14. Consequently, we accord no deference to the interpretation of the commissioner and will substitute our own judgment if we conclude the commissioner made an error of law. Id. at 14–15;Swiss Colony, Inc. v. Deutmeyer, 789 N.W.2d 129, 133 (Iowa 2010).

III. Discussion.

A. Suitable Work.Iowa Code section...