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Smiley v. State

Supreme Court of Vermont

March 6, 2015

Curtis Smiley
v.
State of Vermont

On Appeal from Department of Labor Anne M. Noonan, Commissioner

Christopher McVeigh of McVeigh ¨ Skiff, Burlington, for Plaintiff-Appellant

William J. Blake of Ellis Boxer & Blake PLLC, Springfield, for Defendant-Appellee.

PRESENT: Reiber, C.J., Dooley, Skoglund, Robinson and Crawford, [1] JJ.

DOOLEY, J.

¶ 1. Claimant appeals two decisions in which the Commissioner of the Department of Labor concluded, as a matter of law, that the State did not waive its statute-of-limitations defense and was entitled to summary judgment based on that defense. We concur that the State did not waive the affirmative defense by agreeing to claimant’s request for an impairment rating. We conclude, however, that the commissioner erred by holding that a regulation requiring employers/insurers to determine, at the time an employee with a work-related injury reaches a medical end result, whether the employee has any permanent impairment was not in effect. Nevertheless, we hold that violation of the regulation does not toll the statute of limitations and affirm the commissioner’s ruling that the instant claim for permanent partial disability benefits was barred by the applicable statute of limitations.

¶ 2. On January 20, 1996, claimant injured his left ankle during the scope of his employment as a game warden with the State of Vermont. On July 8, 1996, his treating orthopedic physician indicated in medical notes that: (1) it had been six months since claimant had undergone surgery on his ankle; (2) claimant was back at work and able to walk without limitation but still had trouble with stairs; (3) his limitations were characteristic of someone who had fractured his ankle six months earlier; (4) he was offered physical therapy but declined; (5) it generally takes a year to fully recover from such an injury; (6) claimant agreed to return for physical therapy if his situation did not improve within that time frame as expected; and (7) he would be seen again “as needed.” Based on that evidence, the commissioner found that “as of July 1996 [claimant] knew, or should have known, that he had reached an end medical result, and that whatever deficits he was left with were likely permanent in nature.” [2]

¶ 3. Meanwhile, on May 15, 1996-approximately four months after claimant’s injury and two months before his orthopedic physician wrote the July 8 note-the Department of Labor promulgated Workers’ Compensation Rule 18(a), which states, in relevant part, as follows:

The employer (insurer) shall take action necessary to determine whether an employee has any permanent impairment as a result of the work injury at such time as the employee reaches a medical end result.... A determination as to whether the claimant has any permanent impairment shall be made within 45 days of filing the notice of termination.

Before the department’s promulgation of Rule 18(a), a claimant could investigate a permanent impairment after reaching a medical end result by either directly obtaining an impairment rating from a qualified physician or asking the employer to arrange obtaining the rating; however, there was no express regulatory obligation on the part of the employer-irrespective of any request from the injured employee-to determine whether the employee had a permanent impairment. This was the holding of Longe v. Boise Cascade Corp., 171 Vt. 214, 762 A.2d 1248 (2000), a case in which the claimant applied in 1991 for benefits based on a 1983 injury and argued that because the employer had an obligation to determine whether the claimant had a permanent partial impairment, the statute of limitations was tolled. We held that the workers’ compensation statute imposed no obligation on an employer to investigate whether an employee had a permanent impairment or to inform a potential claimant of the right to permanent partial disability benefits. Id. at 225-26, 762 A.2d at 1257-58.

¶ 4. Claimant took no further action in this case until the fall of 2010, when he asked his employer’s (the State of Vermont’s) workers’ compensation adjuster to schedule a permanency evaluation for his 1996 injury. In response, the adjuster scheduled an independent medical evaluation with a physician, who concluded that claimant had a one percent permanent impairment rating attributable to the 1996 injury. Claimant arranged for a second evaluation with a physician, who reached the same conclusion.

¶ 5. On May 16, 2011, the State filed a form denying permanent benefits to claimant, asserting that the claim for permanent partial disability benefits was time barred because the six-year statute of limitations had expired. [3] Attached to the form was a letter in which the State’s workers’ compensation adjuster stated that, although the statute of limitations had run, she offered to pay the one percent impairment to claimant if he agreed to forego any claim for interest and penalties. In June 2011, claimant filed an application for a hearing on his claim for permanent partial disability benefits related to his 1996 work injury. On September 7, 2011, the State answered claimant’s hearing request by pleading the statute of limitations as an affirmative defense.

¶ 6. In November 2011, the State moved for summary judgment, arguing in part that it had not waived its statute-of-limitations defense by scheduling claimant’s permanency evaluation. On April 15, 2012, in the first of the decisions being appealed, the commissioner granted the State summary judgment on the waiver issue, while preserving the issue of whether the State had any obligation in this case pursuant to Rule 18(a) to determine whether claimant had a permanent partial impairment. In February 2013, the State filed another motion for summary judgment, arguing that claimant’s request for permanent partial benefits was barred by the applicable statute of limitations insofar as Rule 18(a) did not retroactively apply to this case. On June 3, 2013, the commissioner granted the State’s motion for summary judgment, concluding as a matter of law that Rule 18(a) did not apply retroactively and claimant knew or should have known that he had reached a medical end result as of July 8, 1996.

¶ 7. Our review is limited to the following questions certified for appeal: (1) whether the commissioner erred by concluding as a matter of law that the State did not waive its right to deny the instant claim on statute-of-limitations grounds by arranging for claimant to undergo a permanency evaluation; (2) whether the claim was barred as a matter of law by the applicable statute of limitations; and (3) whether the commissioner erred by concluding as a matter of law that the State was not barred from asserting the statute of limitations based on a regulatory duty to investigate the extent of claimant’s permanent impairment. We will uphold the commissioner’s findings unless they are clearly erroneous, but our review of the commissioner’s interpretation of law not within her expertise is nondeferential and plenary. See Sanz v. Douglas Collins Constr., 2006 VT 102, ¶ 5, 180 Vt. 619, 910 A.2d 914 (mem.).

¶ 8. On appeal to this Court, claimant argues that the commissioner erred in granting summary judgment to the State, the moving party, by making inferences in favor of the State with respect to the waiver question and when claimant reached a medical end result. Claimant also argues that the commissioner misinterpreted this Court’s legal precedent in determining that Rule 18(a) should not be applied retroactively to his claim in this case. For its part, the State contends that the commissioner’s decisions were correct in all respects.

¶ 9. We begin with the waiver question. The commissioner rejected claimant’s waiver argument, noting that in past cases the payment of medical bills alone has not been considered a waiver of an employer’s right to contest other aspects of an injured worker’s claims for benefits, and stating that the evidence, even considered most favorably to claimant, does not demonstrate a clear and unequivocal intent on the part of the State’s workers’ compensation adjuster to waive a statute-of-limitations defense. On appeal, claimant argues that, in determining the issue of waiver on summary judgment, the commissioner erroneously gave the State, the moving party, rather than him, the nonmoving party, the benefit of all reasonable inferences. According to claimant, a reasonable inference would have been that the adjuster knew or should have been aware of the statute-of-limitations defense for a fourteen-year-old claim.

¶ 10. The commissioner and the parties have analyzed this issue under the general legal maxim that a waiver is an intentional relinquishment of a known right involving “both knowledge and intent on the part of the waiving party.” LaFrance Architect v. Point Five Dev. S. Burlington, LLC, 2013 VT 115, ¶ 38, ___ Vt. ___, 91 A.3d 364 (quotation omitted). Viewed as such, a waiver may be express or implied, but before a waiver may be implied, “caution must be exercised both in proof and application, ” such that “[t]he facts and circumstances relied upon must be unequivocal in character.” Holden & Martin Lumber Co. v. Stuart, 118 Vt. 286, 289, 108 A.2d 387, 389 (1954).

¶ 11. In this case, claimant is not alleging the existence of an express waiver, but rather asks this Court to find a waiver based solely on the insurance adjuster’s agreement, at claimant’s request, to schedule a permanent impairment evaluation. He contends that the adjuster should have been aware of a potential statute-of-limitations defense to his long-delayed claim, and that such a defense, if successful, would have acted as a complete bar to his claim, making any permanency evaluation unnecessary. He asserts that, at minimum, the state of the evidence was such that, ...


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