W.C. No. 4-010-622Industrial Claim Appeals Office.
May 6, 1996
ORDER OF REMAND
The claimant seeks review of an order by the Director of the Division of Workers’ Compensation (Director) which closed the claim. We set aside the order, and remand for further proceedings.
The Rules of Procedure, Part X(A)(2)(a), 7 Code Colo. Reg. 1101-3 at 37 (1995) provides that upon receipt of a request to close a claim for lack of prosecution:
“the director will issue an order requiring the parties to show cause why the request should not be granted. A response to such order shall be filed within 30 days of the date the order was mailed.”
Rule X(A)(2)(b) also states that if no response is filed within 30 days of the date the show cause order was mailed, the claim shall be automatically closed.
Insofar as pertinent, the record reveals that the respondents made several requests to close the claim. The latest request is dated July 7, 1995. On July 26, 1995, the Director issued a Show Cause Order. The certificate of mailing on the Show Cause Order indicates that a copy of the order was mailed to claimant’s counsel of record, but not the claimant. On September 5, 1995, the Director closed the claim based upon her finding that the claimant failed to respond to the July 26 Show Cause Order.
The claimant timely appealed the September 5 order. The claimant contends that he did not have notice of the Show Cause Order, and thus, argues that the Director’s order closing the claim violated his right to procedural due process.
In response, the respondents contend, inter alia, that the claimant is not entitled to actual notice of the Show Cause Order. We disagree.
Due process of law requires that all parties receive notice of administrative proceedings and determinations which could result in the deprivation of a significant property interest. See Colorado State Board of Medical Examiners v. Palmer, 157 Colo. 40, 400 P.2d 914 (1965). Workers’ compensation benefits are a property interest for due process purposes, and the claimant is entitled to procedural due process before benefits may be terminated. Colorado Compensation Insurance Authority v. Nofio, 886 P.2d 714 (Colo. 1994).
In Owens v. Ready Men Labor, Inc., W.C. No. 4-178-276, August 25, 1995, aff’d Ready Men Labor, Inc. v. Industrial Claim Appeals Office,
(Colo.App. No. 95CA1590, April 25, 1996) (not selected for publication) we concluded that where an employer seeks to terminate temporary disability benefits pursuant to a written offer of modified employment, section 8-42-105(3)(d), C.R.S. (1995 Cum. Supp.), requires that the claimant have actual notice of the written offer of employment. Therefore, in Owens, we held that § 8-42-105(3)(d) does not trigger the termination of temporary disability benefits where the claimant does not receive the written offer of employment from the employer.
We have also concluded in a series of cases that where the employer seeks to close a claim by the filing of a Final Admission of Liability, the claimant must be made “aware” of the effect of his failure to object to the Final Admission. Baran v. Denver Broncos Football Club, W.C. No. 3-875-498, November 8, 1995; Munford v. Bowlen, W.C. No. 3-889-101 et. al., July 13, 1995. The Court of Appeals agreed in Bowlen v. Munford, ___ P.2d ___ (Colo.App. No. 95 CA1285, May 2, 1996), and concluded, that mailing of a Final Admission to the employer’s premises is not sufficient to notify the claimant of the effect of his failure to object to the Final Admission. In so concluding the Munford court noted that the Rules of Procedure, Part IX(B)(1) at p. 39, provide that documents filed with the Division of Workers’ Compensation (Division) must be mailed to “each
party to the claim and attorneys of record.” (Emphasis added). We believe Rule IX(B)(1) also encompasses documents filed by the Division in the claim.
Furthermore, we perceive no rational basis for distinguishing between the closure of a claim pursuant to the claimant’s failure to respond to a Final Admission of Liability, and the closure due to the claimant’s failure to respond to an order to show cause. To the contrary, a Final Admission of Liability and an order to show cause both contemplate that the claimant will receive actual notice of the document, because both require the claimant to file a written response if he objects to closure of the claim.
The respondents’ further arguments to the contrary do not alter our conclusion. Consequently, we conclude that the closure of a claim under Rule X(A)(2) requires proof that the claimant had actual notice of the Show Cause Order before the failure to respond to the Show Cause Order triggers the automatic closure of the claim. Accordingly, we believe that the Director was required to mail a copy of the July 26 Show Cause Order to both the claimant and the claimant’s counsel of record. See also Adolph Coors Co., v. Charnes, 690 P.2d 893 (Colo.App. 1984); Loeffler v. Reeder, W.C. No. 3-940-761, September 14, 1992.
Here, the certificate of mailing on the July 26 Show Cause Order does not reflect that a copy of the order was mailed to the claimant. Furthermore, there is no assertion that the Show Cause Order was mailed or otherwise served upon the claimant. Consequently, we are compelled to conclude that the claimant did not receive notice of the Show Cause Order, and thus, was denied procedural due process.
IT IS THEREFORE ORDERED that the Director’s order dated September 5, 1995, is set aside, and the matter is remanded to the Director for further proceedings concerning the respondents’ request that the claim be closed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
Copies of this decision were mailed May 6, 1996 to the following parties:
Arthur Bluearm, 299 17th St., San Diego, CA 92101
Ready Men Labor, Inc., 965 E. 22nd Ave., Denver, CO 80205
Colorado Compensation Insurance Authority, Attn: Marjorie J. Long, Esq. (Interagency Mail)
Curtis R. Spencer, Jr., Esq., 1999 Broadway, Ste. 2440, Denver, CO 80202 (For the Claimant)
BY: _______________________