State ex rel., Wyoming Workers' Compensation Div. v. Hollister

• Citation: 794 P.2d 886
• Decision Date: 06 July 1990
• Docket Number: No. 90-21,90-21
• Parties: STATE of Wyoming, ex rel., WYOMING WORKERS' COMPENSATION DIVISION, Appellant (Petitioner/Objector-Defendant), v. Lance E. HOLLISTER, Appellee (Respondent/Employee-Claimant), v. TEGELER LOGGING, Employer-Objector.
• Court: United States State Supreme Court of Wyoming

Page 886

794 P.2d 886

STATE of Wyoming, ex rel., WYOMING WORKERS' COMPENSATION DIVISION, Appellant (Petitioner/Objector-Defendant), v. Lance E. HOLLISTER, Appellee (Respondent/Employee-Claimant), v. TEGELER LOGGING, Employer-Objector.

No. 90-21.

Supreme Court of Wyoming.

July 6, 1990.

Joseph B. Meyer, Atty. Gen., Ron Arnold, Sr. Asst. Atty. Gen., for appellant.

Thomas E. Campbell, Sheridan, for appellee.

Before CARDINE, ^* C.J., and THOMAS, URBIGKIT, MACY and GOLDEN, JJ.

THOMAS, Justice.

The dispositive question in this case is whether a district court has authority to afford affirmative relief as a product of its review of a workers' compensation proceeding. A second question that must be resolved is whether the district court properly ruled that the injured workman had not engaged in conduct that justified the invocation of the injurious practices statute, § 27-12-412, W.S.1977. ¹ A question related to both of these issues is whether the district court improperly substituted its judgment for that of the administrative hearing officer. We agree with the contention of the Wyoming Workers' Compensation Division (Division) that the district court has no authority to afford affirmative relief in connection with a review of a workers' compensation proceedings. Its disposition is limited to the review of authority articulated in the Wyoming Administrative Procedure Act, §§ 16-3-101 to -115, W.S.1977 (Oct. 1982 Repl.). We agree, however, with the ruling of the district court that the injurious practices statute was not applicable, and we conclude that this ruling was properly made within the review authority of the district court. We reverse and remand this case for further proceedings in accordance with our opinion.

The Division sets forth the issues it has chosen to advance in this way:

"1. Whether the district court erred as a matter of law by reversing the administrative decision on the grounds that the injurious practice statute was not applicable.

"2. Whether the district court erred as a matter of law by substituting its judgment and opinion for that of the hearing officer.

"3. Whether the district court lacked statutory authority to award a permanent total disability award."

The injured worker, Lance E. Hollister (Hollister), restates the issues in this way in his brief:

"1. Whether the order of the administrative law judge (ALJ) that Hollister engaged in an injurious practice sufficient to invoke the harsh penalty of forfeiture is arbitrary, capricious and not in accordance with law.

"2. Whether the decision of the ALJ is unsupported by substantial evidence.

"3. Whether Hollister should be awarded permanent total disability benefits."

In July of 1984, while Hollister was working for Tegeler Logging, he slipped on a log and fell onto a rock, injuring his left knee. A few days later, Hollister filed his original report of injury with the Clerk of the District Court of Sheridan County. Tegeler Logging waived any objection to the claim and approved payment within a week. The treating physician, in February of 1985, rated Hollister as having a 50% disability of the knee based on pain, limited motion, and joint destruction. Hollister was next evaluated by the Division of Vocational Rehabilitation at the Gottsche Rehabilitation Center in Thermopolis. The product of that evaluation was the recommendation that he should give serious consideration to less strenuous work, but that he might go back to the logging industry in a different position if further surgery could make his knee more stable. In March of 1985, an award was made in the District Court of Sheridan County of a 50% permanent partial disability.

After that, Hollister had an osteotomy performed in August of 1985. He received temporary total disability during the period of recuperation from that surgery. The following May, Hollister was returned to his permanent partial disability status and, at that time, received the balance of the permanent partial disability award.

The record is clear that Hollister endeavored to find lighter work to support his family of seven, but he was unable to find suitable employment in either Wyoming or Montana. He then returned to his former occupation in the logging industry, and he worked for several employers. Eventually, his pain reached a level that prevented him from accomplishing his tasks in his logging occupation. Hollister applied for further benefits, and he received those for a short period. He then was denied any additional benefits, and the denial of that claim resulted in this case.

The administrative hearing officer found that Hollister had returned to logging and other heavy labor following his original injury and that this constituted an injurious practice that served to invoke the penalty of forfeiture of any further right to compensation. That conclusion was premised upon the demonstration in the record that he had been advised by physicians not to return to work in the logging industry, but to find some other line of work instead. Upon review, the district court ruled that Hollister's return to employment in the logging industry was not a violation of the statutory provision, § 27-12-412, W.S.1977, and then entered an award of permanent total disability in favor of Hollister. It is from the decision of the district court that the Division has taken this appeal.

One of the indubitable features of the 1986 revision of the Wyoming Workers' Compensation Act, § 27-14-101 to -804, W.S.1977 (June 1987 Repl.), is that the adjudicatory function was moved from our state district courts to the "office of independent hearing officers." Section 27-14-602, W.S.1977 (June 1987 Repl.). The appeal to the district court from the decision of a hearing examiner is taken pursuant to the Wyoming Administrative Procedure Act. According to the frequently quoted provisions of the Wyoming Administrative Procedure Act, § 16-3-114(c), W.S.1977 (Oct. 1982 Repl.):

" * * * The reviewing court shall:

"(i) Compel agency action unlawfully withheld or unreasonably delayed; and

"(ii) Hold unlawful and set aside agency action, findings and conclusions found to be:

"(A) Arbitrary, capricious, an abuse of discretion or otherwise not in accordance with law;

"(B) Contrary to constitutional right, power, privilege or immunity;

"(C) In excess of statutory jurisdiction, authority or limitations or lacking statutory right;

"(D) Without observance of procedure required by law; or

"(E) Unsupported by substantial evidence in a case reviewed on the record of an agency hearing provided by statute."

It follows that when a workers' compensation determination of the hearing examiner is appealed to the district court, this quoted language circumscribes the disposition by the district court.

The same standards that apply to this court in reviewing administrative determinations are applicable to district courts. With respect to our authority, we have said:

" 'For the purpose of reviewing the propriety of the district court's action, we will review the agency action as though the appeal were directly to this court from the agency. We are governed by the same rules of review as was the district court. [Citations.]

" 'Therefore, we will not substitute our judgment for that of the agency. * * *

" ' * * * * * *

" ' * * * Under this standard [§ 16-3-114(c), W.S.1977 (October 1982 Replacement) ], we do not examine the record only to determine if there is substantial evidence to support the Board's decision, but we must also examine the conflicting evidence to determine if the Board could reasonably have made its findings and order upon all of the evidence before it.' " Trout v. Wyoming Oil & Gas Conservation Commission, 721 P.2d 1047, 1050 (Wyo.1986), quoting Board of Trustees of School District No. 4, Big Horn County v. Colwell, 611 P.2d 427, 428-29 (Wyo.1980).

The inhibition upon substitution of the court's judgment for that of the agency has to extend to the affirmative relief afforded by the district court in this instance. It follows that the order of the district court awarding total disability benefits must be reversed, and the district court appropriately should remand the case to the office of hearing examiners after setting aside its determination on the ground that it is not in accordance with law.

This disposition flows from our agreement with the district court that the hearing examiner inappropriately invoked § 27-12-412, W.S.1977, relating to the forfeiture of right to compensation because of the knowing engagement or persistence in an unsanitary practice that tends to imperil or retard recovery. We are not in agreement with the Division's contention that the district court's ruling on this issue was erroneous.

In his decision letter, the hearing examiner noted that the treating physician felt that, to avoid " 'total knee arthroplasty [for] as long as possible,' " Hollister should change occupations. The hearing examiner also quoted from the report of the surgeon who performed the osteotomy that " 'he is permanently disabled as far as the left knee is concerned and will be forever limited to light activities.' " The latter physician went on to say that Hollister's knee would continue to degenerate, but he could not say when that would occur. Based upon this information, the hearing examiner held, as a matter of law, that one can impair or retard recovery of a knee that is...