Trax-Fax, Inc. v. Hobba

• Decision Date: 02 February 2006
• Docket Number: No. A06A0397.,A06A0397.
• Court: Georgia Court of Appeals
• Parties: TRAX-FAX, INC. et al. v. HOBBA.

277 Ga. App. 464

627 S.E.2d 90

TRAX-FAX, INC. et al. v. HOBBA.

No. A06A0397.

Court of Appeals of Georgia.

February 2, 2006.

COPYRIGHT MATERIAL OMITTED

Donald M. Shivers, Shivers & Associates, Alpharetta, for Appellant.

Akin & Tate, S. Lester Tate III, William F. Kelley, Cartersville, for Appellee.

BLACKBURN, Presiding Judge.

In this discretionary appeal, employer Trax-Fax and insurer Travelers Indemnity (collectively "Travelers") appeal a ruling of the superior court reversing the State Board of Workers' Compensation's (the "Board") award of reimbursement of disability benefits, previously paid to Buddy Hobba, in favor of Travelers. Travelers contends that the superior court erred by (1) failing to apply the "any evidence" standard in reviewing the Board's decision; (2) interpreting OCGA § 34-9-245 as a statute of repose and applying it retroactively to bar any claims for reimbursement of benefits paid more than two years prior to the application for reimbursement; and (3) reversing the Board's award of attorney fees, assessment of a civil penalty against Hobba, and referral of the matter to the Board's Fraud and Compliance Enforcement Division. For the reasons set forth below, we affirm in part and reverse in part.

In the absence of legal error, the factual findings of the Board must be affirmed by the superior court and the Court of Appeals when supported by any evidence in the administrative record. Ga.-Pacific Corp. v. Wilson.¹ "Moreover, in determining whether evidence in the case meets the `any evidence' rule, the evidence will be construed in the light most favorable to the party prevailing before the Board and every presumption in favor of the Board's award is indulged." (Punctuation omitted.) Footstar, Inc. v. Stevens.² However, erroneous applications of law to undisputed facts, as well as decisions based on erroneous theories of law, are subject to a de novo standard of review. Trent Tube v. Hurston.³

The record demonstrates that Hobba is the president and sole shareholder of the employer, Trax-Fax, a company in the business of inspecting railroad tracks to determine their compliance with regulatory standards. Other than Hobba's wife, the company does not employ any additional full-time employees. On July 28, 1998, Hobba was seriously injured in a work-related accident. Based on this injury, he was awarded temporary total disability ("TTD") workers' compensation benefits. Travelers suspended Hobba's benefits on April 24, 2002, but it was not until December 10, 2003, that Travelers filed a notice of suspension of benefits, alleging that Hobba had improperly continued to receive benefits despite returning to work less than a year after his accident. In conjunction with this notice, Travelers requested a hearing to determine whether it was entitled to reimbursement of all benefits paid to Hobba. Additionally, Travelers sought attorney fees, litigation expenses, civil penalties, and referral of the matter to the Enforcement Division for potential criminal prosecution.

After a hearing and review of briefs filed by both parties, the administrative law judge ("ALJ") found that Hobba was never totally economically disabled and that a statute of limitation defense raised by Hobba in his brief⁴ was waived because it had not been raised at the hearing. Consequently, the ALJ ruled that Travelers was entitled to full reimbursement of benefits pursuant to OCGA § 34-9-104(d). The ALJ further ordered Hobba to pay attorney fees and litigation expenses, as well as a civil penalty, and referred the matter to the Board's Enforcement Division. Hobba appealed this ruling to the Board, arguing that the ALJ incorrectly found OCGA § 34-9-245 to be a statute of limitation as opposed to a total bar against any reimbursement claims asserted more than two years after the actual overpayment. The Board upheld the ALJ's ruling that Travelers was entitled to full reimbursement, as well as attorney fees, and that Hobba be assessed a civil penalty, but reversed the award of litigation expenses. In addition, the Board agreed with the ALJ's finding that Hobba had waived any statute of limitation defense and further stated that because his injury predated the enactment of OCGA § 34-9-245, Hobba could not apply the statute retroactively as a defense to Travelers's claims.

Hobba appealed to the superior court, focusing his argument on the assertion that OCGA § 34-9-245 constituted a statute of repose and that, therefore, any claims for reimbursement of overpayments made more than two years prior to Travelers's December 10, 2003 hearing request were abrogated. The superior court agreed and reversed the Board in part, ruling that because OCGA § 34-9-245 was a statute of repose, Travelers was entitled to reimbursement for benefits paid on or after December 10, 2001, but was not entitled to recover any benefits paid prior to that date. The court also reversed the award of attorney fees, the assessment of the civil penalty, and the referral of the matter to the Enforcement Division. This discretionary appeal sought by Travelers followed.

1. In its first enumeration of error, Travelers contends that the superior court erred in failing to apply the "any evidence" rule when it reversed the decision of the Board. It is axiomatic, as previously stated, that neither the superior court nor this Court may disturb the Board's findings of fact if they are based on any evidence contained in the record. See Ga.-Pacific Corp., supra. The superior court's partial reversal of the Board's reimbursement award to Travelers, however, was based on a legal interpretation of OCGA § 34-9-245 as a statute of repose rather than as a statute of limitation. In reviewing an application of the law, the superior court was not bound by the "any evidence" rule and, indeed, correctly scrutinized the Board's ruling on this issue under a de novo standard of review. See Trent Tube, supra.

In contrast to its review of the Board's interpretation of OCGA § 34-9-245, the superior court's review of the Board's findings warranting an award of attorney fees to Travelers, a civil penalty assessment against Hobba, and a referral of the matter to the Enforcement Division was governed by the "any evidence" standard. See Atlanta Janitorial Svc. v. Jackson.⁵ We examine in Division 3, below, whether the superior court correctly applied this standard in its reversal of the Board's findings as to these issues.

2. Travelers also contends that the superior court erred in justifying its partial reversal of the Board's reimbursement award on the ground that OCGA § 34-9-245 constitutes a statute of repose abrogating any claims for reimbursement asserted more than two years after the actual overpayment was made. Travelers specifically argues that OCGA § 34-9-245 is a statute of limitation which was waived when Hobba failed to assert it as a defense prior to the hearing before the ALJ. Alternatively, Travelers argues that even if OCGA § 34-9-245 constitutes a statute of repose, its enactment one year after Hobba's injury precludes its retroactive application. We disagree and find that OCGA § 34-9-245 constitutes a statute of repose which may be properly applied in this matter. Consequently, we affirm the superior court's ruling that Travelers's reimbursement claims for overpayments made prior to December 10, 2001, are abrogated.

(a) Statute of Repose. "Statutes should be read according to the natural and most obvious import of the language, without resorting to subtle and forced constructions, for the purpose of either limiting or extending their operation." Integon Indem. Corp. v. Canal Ins. Co.⁶ In reviewing a statute, we presume that the legislature enacts all statutes with knowledge of the existing laws. Simmons v. Sonyika. ⁷ Moreover, in specifically reviewing a statute to determine whether it was intended as a statute of repose, we consider that

[t]he distinction between the statute of limitation and the statute of repose ... is clear. A statute of limitation is a procedural rule limiting the time in which a party may bring an action for a right which has already accrued. A statute of ultimate repose delineates a time period in which a right may accrue. If the injury occurs outside that period, it is not actionable.

(Punctuation omitted.) Id. Furthermore, a statute of repose is also distinct from a statute of limitation in that

[a] statute of repose stands as an unyielding barrier to a plaintiff's right of action. The statute of repose is absolute; the bar of the statute of limitation is contingent. The statute of repose destroys the previously existing rights so that, on the expiration of the statutory period, the cause of action no longer exists.

(Citation omitted.) Id.

Here, OCGA § 34-9-245 reads:

Should the board find that a claimant has received an overpayment of income benefits from the employer, for any reason, the board shall have the authority to order repayment on terms acceptable to the parties or within the discretion of the board. No claim for reimbursement shall be allowed where the application for reimbursement is filed more than two years from the date such overpayment was made.

(Emphasis supplied.) The specific language "no claim for reimbursement shall be allowed" bears the distinctive hallmarks of a statute of repose in that it is prohibitive and contemplates an absolute barrier to a plaintiff's reimbursement right of action commenced more than two years after an actual overpayment.

A review of other statutes of repose reveals similar prohibitive language and delineations of time within which a right may accrue. For instance, OCGA § 9-3-71(b), the medical malpractice statute of repose, provides that "in no event may an action for medical malpractice be brought more than five years after the date on which the negligent or wrongful act or omission occurred." See id. The statute of repose pertaining to improvement of real property provides that "[n...