Ruddick v. Boeing Co.

• Decision Date: 12 December 1997
• Docket Number: No. 78343,78343
• Parties: Martin RUDDICK, Claimant-Appellee, v. The BOEING COMPANY and Aetna Casualty & Surety Company, Respondent and Insurance Carrier/Appellants, and Workers Compensation Fund, Appellee.
• Court: Kansas Supreme Court

Page 1132

949 P.2d 1132

263 Kan. 494

Martin RUDDICK, Claimant-Appellee, v. The BOEING COMPANY and Aetna Casualty & Surety Company, Respondent and Insurance Carrier/Appellants, and Workers Compensation Fund, Appellee.

No. 78343.

Supreme Court of Kansas.

Dec. 12, 1997.

Syllabus by the Court

1. Review by the appellate courts of a decision of the Workers Compensation Board is in accordance with the Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-601 et seq. Under K.S.A.1996 Supp. 44-556(c), appellate review is explicitly limited to questions of law.

2. The timely filing of an appeal is jurisdictional.

3. Where constitutional grounds for reversal are asserted for the first time on appeal, they are not properly before the appellate court for review.

4. Rules or regulations of an administrative agency must be within the statutory authority conferred upon the agency. Those rules or regulations that go beyond the authority authorized, which violate the statute, or are inconsistent with the statutory powers of the agency are void.

5. K.A.R. 51-19-1 is in direct conflict with K.S.A. 44-528(d) and is, therefore, void.

Vaughn Burkholder, of Foulston & Siefkin, L.L.P, Wichita, argued the cause, and Stephen M. Kerwick, of the same firm, was with him on the briefs, for appellant.

Michael L. Snider, of Snider & Seiwert, L.L.C., Wichita, argued the cause and was on the brief, for appellee Martin Ruddick.

WAHL, Senior Judge, assigned:

This is a workers compensation case in which the respondent, Boeing Company (Boeing), appeals from a portion of an order of the Workers Compensation Board (Board) finding that Boeing should have continued permanent partial disability payments pursuant to the claimant's original award until the date the administrative law judge (ALJ) entered an order of review and modification, instead of ceasing payments as of the date the claimant returned to work.

The facts are not in dispute. Claimant, Martin Ruddick, was injured during the course of his employment with Boeing, having developed carpal tunnel syndrome and epicondylitis in both arms through repeated work activities as a sheet metal assembler. He underwent surgery to relieve these conditions. On March 29, 1994, Ruddick was laid off. On July 12, 1995, Ruddick's claim was resolved through an agreed award under which Ruddick received benefits based upon a permanent partial disability for 159.74 weeks and a work disability of 38.5%, which reflected a work disability in excess of his functional impairment rating. The parties stipulated to a 14% general bodily disability, and payments were to begin as of September 5, 1994.

On March 18, 1996, Ruddick was recalled to employment at Boeing for a wage comparable to his pre-injury wage. By that time, he had received 83 weeks of permanent partial disability benefits.

On April 2, 1996, Boeing filed an application for review and modification of the existing agreed award and discontinued compensation payments to Ruddick as of April 7, 1996. Boeing's position was based upon K.S.A. 44-510e(a), which provided that an employee "shall not be entitled to receive permanent partial general disability in excess of the percentage of functional impairment as long as the employee is engaging in any work for wages equal to 90% or more of the average gross weekly wage the claimant was earning at the time of the injury."

K.S.A. 44-510e(a) provides that an award of permanent partial disability benefits is to be paid at the full rate for a fraction of the statutory period comparable to the percentage of disability--in this case 14%. The amount of the ultimate award to which Ruddick was entitled for permanent partial disability had already been exhausted by the time he returned to work at Boeing, and Boeing contends it had no further liability for payments.

Boeing's application for review and modification was set for hearing before the ALJ on April 9, 1996. Ruddick opposed Boeing's application for modification of the award and contended that, according to K.S.A. 44-510e(a), the July award had to be paid for the number of full disability weeks at the full payment until fully paid or modified. On June 12, 1996, the ALJ ruled in favor of Boeing, noting that the appropriate amount of benefits for claimant's disability based upon functional impairment alone--that is, if he had remained employed throughout the period--would have been 58.1 weeks. Since Boeing had already paid 83 weeks of benefits due to the work disability resulting from Ruddick's layoff, the ALJ ruled Boeing was correct to terminate payments as of the date Ruddick returned to employment at Boeing. Ruddick appealed the ALJ's review and modification order to the Board.

The Board framed the issues as:

1. whether the ALJ properly calculated Ruddick's remaining benefits;

2. whether Ruddick was entitled to continue to receive permanent partial disability benefits through June 12, 1996, the date of the ALJ's review and modification order, rather than through March 18, 1996, the date he returned to work at Boeing; and

3. whether Ruddick was entitled to an award of attorney fees.

The Board found that the ALJ had properly calculated the disability award and had properly denied attorney fees. The Board, however, found that Boeing should have continued payment of permanent partial disability pursuant to the original award until the date the ALJ entered the order of review and modification on July 13, 1996, instead of ceasing payments on the date Ruddick returned to work. The Board based its decision upon K.A.R. 51-19-1, which provides:

"Where application for review and modification pursuant to K.S.A. 44-528 is made by a respondent from an award which is in full force and effect, compensation payments are to continue until it is finally determined that the original award is to be modified and the amounts determined. The filing of the application for review and modification does not carry with it the right to stop compensation being paid under an award."

The Board found, under a 3-2 decision, that Boeing should have continued to pay the ordered permanent partial disability compensation until July 13, 1996, the effective date of the award on review and modification. Boeing appeals from that portion of the Board's order awarding Ruddick compensation for the time period between March 18, 1996, and July 13, 1996.

Review of the Board's decision by the appellate courts is in accordance with the Act for Judicial Review and Civil Enforcement of Agency Actions (Act), K.S.A. 77-601 et seq. See K.S.A. 44-557. Under K.S.A.1996 Supp. 44-556(c), appellate review is explicitly limited to questions of law. See Kindel v. Ferco Rental, Inc., 258 Kan. 272, 277, 899 P.2d 1058 (1995). K.S.A. 77-621 states, in relevant part:

"(c) The court shall grant relief only if it determines any one or more of the following:

...

(4) the agency has erroneously interpreted or applied the law;

...

(7) the agency action is based on a determination of fact, made or implied by the agency, that is not supported by evidence that is substantial when viewed in light of the record as a whole ...; or

(8) the agency action is otherwise unreasonable, arbitrary or capricious."

The court may review an administrative agency action, e.g., promulgation of a regulation, as any other civil case would be reviewed. K.S.A. 77-623. We must determine whether K.A.R. 51-19-1 improperly conflicts with K.S.A. 44-528(d), which requires statutory construction. Statutory construction is a question of law, and this court has unlimited appellate review of these issues.

Moreover, K.S.A. 44-528 specifically provides for review where there is a change in the claimant's "work disability." "Work disability is: (a) The extent to which the ability of the employee to perform work in the open labor market has been reduced, and, (b) the extent to which the ability of the worker to earn comparable wages has been reduced." Hughes v. Inland Container Corp., 247 Kan. 407, 417, 799 P.2d 1011 (1990).

Ruddick raises an issue requesting affirmative relief from this court which he should have raised by appeal for judicial review. See K.S.A.1996 Supp. 44-556(a). Ruddick disagrees with the method of calculation of benefits used by the ALJ and affirmed by the Board. Timely filing of an appeal is jurisdictional. See K.S.A.1996 Supp. 44-556; Jones v. Continental Can Co., 260 Kan. 547, 920 P.2d 939 (1996). Since Ruddick has sought additional benefits beyond those awarded, he had to appeal or be limited only to arguments in support of the result below.

Ruddick also raises a constitutional issue which was not raised below and contends that his due process and equal protection rights were violated. Where constitutional grounds for reversal are asserted for the first time on appeal, they are not properly before the appellate court for review. In re M.M.L., 258 Kan. 254, Syl. p 1, 900 P.2d 813 (1995); Murphy v. IBP, Inc., 240 Kan. 141, Syl. p 3, 727 P.2d 468 (1986).

Turning to the issue regarding the impact of K.A.R. 51-19-1 on Ruddick's work disability compensation, we note that K.S.A. 44-528 provides:

"(d) Any modification of an award under this section on the basis that the functional impairment or work...