ALASKA WORKERS' COMPENSATION BOARD

P.O. Box 25512 Juneau, Alaska 99802-5512

 

 

 

 
ROBERT L. CHURCH, 
Employee, 
Applicant
v. 
SILVER BAY LOGGING INC,
Employer,
and
ALASKA TIMBER EXCHANGE INS.
Insurer,
Defendants.
 
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SUPPLEMENTARY ORDER
DECLARING DEFAULT
AWCB Case No. 199510849
AWCB Decision No. 99-0235
Filed with AWCB Fairbanks, Alaska 
on November 18, 1999

We heard the employer's request for a default order against the employee on the written record in Anchorage, Alaska on October 19, 1999. Attorney Michael Patterson represented the employee. Attorney Richard Wagg represented the employer. We closed the record at the conclusion of the hearing.

ISSUE

Shall we issue a default order under AS 23.30.170 against the employee for failing to timely pay reimbursements awarded to the employer in AWCB decision number 98-0139 (June 24, 1999)?

SUMMARY OF THE PROCEEDINGS AND EVIDENCE

On May 27, 1999, we heard the employer's August 25, 1998 petition to order reimbursement by the employee of the costs of all benefits obtained since February 25, 1997, and to pay the employer's attorney fees and costs pursuant to AS 23.30.250(b). The basis of the petition was the employer’s belief the employee knowingly made false or misleading statements or representations to obtain benefits.

On March 5, 1995, the employee injured his left arm (hand and elbow) while "running shovel" for Employer. The factual and legal history is set forth in detail in Church v. Silver Bay Logging, AWCB decision number 98-0139 (June 24, 1999) (Church I), issued following the May 27, 1999 hearing, and is hereby incorporated by reference. Our conclusions were summarized and the Order announced at pages 14-16 of the decision as follows:

In summary, we find Employee consistently portrayed himself as disabled and in extreme pain to the above named physicians and to Employer through non-verbal representations and statements. We find, however, that Employee's representations and statements were false and misleading. We make this finding, initially, based on the January 27, 1998 video surveillance tape made by Investigator Poth which showed Employee engaged in the repair of his pick-up truck. First, we find, Employee (as well as his wife) patently misrepresented facts related to work performed on his vehicles since Employee's third surgery. (Employee dep. 59).

Wagg: When was the last time you might have worked on your car?

Mrs.Church: It's been years. We haven't had one breakdown.

Wagg: (To Mrs. Church) I'm afraid I'm going to have to ask you not to answer.

Mr. Cox: You are not under oath.

Employee: I can't remember.

Wagg: Not, anyway, since your third surgery? We will put it in that time frame.

Employee: No.

(Id.).

We find, based on our review of the surveillance videos, Employee did not posture his arm in the same manner he did during his deposition, or in his evaluations Drs. Ochoa, Carter and Baker. We find Employee had no observable difficulty using both his hands to carry objects and perform work on his vehicle. We observed Employee rolling over, and laying on, his left arm in contraindication to his statement that such touching would cause him significant pain. Based on these observations, we agree with Dr. Ochoa testimony that Employee's "actual performance . . . is irreconcilable with his behavior when examined . . . and with his statements about his symptoms and his capacity to perform as volunteered to us and other medical providers." Additionally, we agree with Dr. Ochoa's conclusion that Employee's "behavior is irreconcilable with his stated incapacity and severity of symptoms: pain grade, ten; hyperalgesia, grade ten."

We also find Employee's use of his left arm and hand, to the level recorded on the January 27, 1998 video, was not isolated to that incident or day. Instead, we find Employee routinely and regularly used his left arm and hand in a manner similar to the use of his right arm and hand. We make this finding as follows. We find, based on Dr. Ochoa's testimony, disuse of a limb, as the result of organic nerve damage or conversion disorder, will cause marked atrophy. Based on Dr. Carter's May 18, 1998 report and Dr. Baker's December 2, 1998 letter to Dr. Ricketts, we find Employee did not have atrophy. Therefore, we conclude, as did Dr. Ochoa, that Employee was regularly using his arm in a manner which was not consistent with his deposition testimony and posturing, or his statements and posturing to Drs. Ochoa, Baker, and Carter during their evaluations.

We next consider whether Employee's false or misleading representations or statements were made knowingly. We find they were.

We make this finding based on the extended period of time over which Employee misrepresented his activities, and to the diverse number of physicians to whom he made misleading statements. We find Employee misrepresented his abilities and pain levels to Dr. Ochoa as early as February 1997, based on Dr. Ochoa's February 25, 1997 report. Furthermore, we find, based on the lack of atrophy in his arm, Employee was routinely using his limb from well before his visit with Dr. Carter in February 1998 through the time he was evaluated by Dr. Baker in December 1999 [Sic]. Based on these findings we conclude Employee's misleading and false representations were not isolated incidents of misspeaking. We find instead such statements and representations demonstrated a knowingly made pattern of deceit for the purpose of extending his workers' compensation claim.

Finally, we find, based on Pamela Scott's testimony, Employee received $12,018.36 in indemnity payments and $10,448.26 in medical benefits. Therefore, we find Employer has clearly and convincingly proven Employee knowingly made false and misleading statements or representations to obtain benefits. Accordingly, we will grant Employer's August 28, 1998 Petition under Section 250 (b) of the Act for reimbursement of benefits paid after February 25, 1997, and for an award of Employer's attorney fees and costs.

Based on Pamela Scott's testimony and the Affidavit of Attorney Wagg, Employer has paid a total of $44,941.88 since February 25, 1997 on Employee's claim. We find this amount includes the payment of indemnity and medical benefits, as well as the attorney fees and costs incurred by Employer in obtaining an order from the Board under this section. We find Attorney Wagg's fee rate, and the time he spent prosecuting this claim, are reasonable, based on his experience as a workers' compensation attorney. We further find the legal costs incurred, including the payment for surveillance, is reasonable. Accordingly, we will order Employee to reimburse Employer in the amount of $44,941.88.

ORDER

1. Employer's August 28, 1998 Petition is granted.

2. Employee shall reimburse Employer a total of $44,941.88 for the cost of benefits obtained since February 25, 1997, and for the reasonable attorney fees and litigation costs, including investigator fees, Employer incurred to obtain an order of reimbursement.

The employee appealed our decision in Church I and has made no payments, but the Order was not stayed by the Superior Court. Therefore, the employer now requests that we issue a supplementary order to allow it to pursue such payments through the Superior Court. The employee asserts, given the pending appeal, we have no authority to issue this supplementary order.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

AS 23.30.170 provides:

(a) In case of default by the employer in the payment of compensation due under an award of compensation for a period of 30 days after the compensation is due, the person to whom the compensation is payable may, within one year after the default, apply to the board making the compensation order for a supplementary order declaring the amount of the default. After investigation, notice, and hearing, as provided in AS 23.30.110, the board shall make a supplementary order declaring the amount of the default. The order shall be filed in the same manner as the compensation order.

(b)If the payment in default is an installment of the award, the board may, in its discretion, declare the whole of the award as the amount in default. The applicant may file a certified copy of the supplementary order with the clerk of the superior court. The supplementary order is final. The court shall, upon the filing of the copy, enter judgment for the amount declared in default by the supplementary order if it is in accordance with law. Any time after a supplementary order by the board, the attorney general, when requested to do so by the commissioner, shall take appropriate action to assure collection of the defaulted payments.

(c) Review of the judgment may be had as in a civil action for damages. Final proceedings to execute the judgment may be had by writ of execution. The court shall modify the judgment to conform to a later compensation order upon presentation of a certified copy of it to the court.

AS 23.30.250. provides:

(a) A person who (1) knowingly makes a false or misleading statement, representation, or submission related to a benefit under this chapter; (2) knowingly assists, abets, solicits, or conspires in making a false or misleading submission affecting the payment, coverage, or other benefit under this chapter; (3) knowingly misclassifies employees or engages in deceptive leasing practices for the purpose of evading full payment of workers’ compensation insurance premiums; or (4) employs or contracts with a person or firm to coerce or encourage an individual to file a fraudulent compensation claim is civilly liable to a person adversely affected by the conduct, is guilty of theft by deception as defined in AS 11.46.180, and may be punished as provided by AS 11.46.120 - 11.46.150.

(b) If the board, after a hearing, finds that a person has obtained compensation, medical treatment, or another benefit provided under this chapter by knowingly making a false or misleading statement or representation for the purpose of obtaining that benefit, the board shall order that person to make full reimbursement of the cost of all benefits obtained. Upon entry of an order authorized under this subsection, the board shall also order that person to pay all reasonable costs and attorney fees incurred by the employer and the employer’s carrier in obtaining an order under this section and in defending any claim made for benefits under this chapter. If a person fails to comply with an order of the board requiring reimbursement of compensation and payment of costs and attorney fees, the employer may declare the person in default and proceed to collect any sum due as provided under AS 23.30.170(b) and (c).

We find the employee was ordered to reimburse the employer in the amount of $44,941.88, as awarded in our July 24, 1999 decision and order. By the preponderance of the available evidence, we find the employee failed to pay any of the ordered reimbursement to the employer within the 30-day limit, defaulting on the full amount awarded. We also find the employer applied to us within one year of the default for a supplementary default order.

We find the award is in default; and we find the statutory criteria for a default order are met. The record contains no evidence the employee has obtained a stay of our decision, as provided for in Appellate Rule 603 and AS 23.30.125(a)&(c). The employee cited no other legal authority for the proposition this order should be delayed, pending appeal, and we are aware of no such authority. In the absence of a Superior Court interlocutory order, staying payment of our award, we conclude, pursuant to AS 23.30.170 we must issue a supplementary order, declaring default.

SUPPLEMENTARY ORDER OF DEFAULT

The employee is in default of AWCB decision number 98-0139 (June 24, 1999). The amount in default is $44,941.88, awarded under AS 23.30.250.

Dated at Fairbanks, Alaska this 18th day of November, 1999.

ALASKA WORKERS' COMPENSATION BOARD

/s/ Fred Brown
Fred Brown, Designated Chairman

/s/ S.T. Hagedorn
S. T. Hagedorn, Member

CERTIFICATION

I hereby certify that the foregoing is a full, true and correct copy of the Supplementary Order Declaring Default in the matter of ROBERT L. CHURCH, employee / applicant; v. SILVER BAY LOGGING INC., employer / ALASKA TIMBER EXCHANGE INS., insurer, defendants; Case No. 199510849; dated and filed in the office of the Alaska Workers' Compensation Board in Fairbanks, Alaska, this 18th day of November, 1999.

Lora Eddy, Clerk

SNO