W.C. No. 2002-110238.Industrial Claim Appeals Office.
January 13, 2004.
ORDER OF REMAND
Sundance Equestrian Center (employer) seeks review of an order of Administrative Law Judge Muramoto (ALJ) which imposed a fine based on the employer’s failure to carry workers’ compensation insurance, and assessed penalties based on the employer’s failure to respond to a request for information from the Division of Workers’ Compensation (DOWC). We affirm the order in part and set it aside in part insofar as it assessed a fine. With respect to penalties for failure to respond, we set the order aside and remand for further proceedings
On June 11, 2003, the DOWC filed an application for hearing, requesting the imposition of a fine pursuant to § 8-43-409(1), C.R.S. 2003, based on the employer’s failure to insure its liability for worker’s compensation. The application further sought penalties for violation of the Act under § 8-43-304(1), C.R.S. 2003, based on the employer’s alleged failure to provide the DOWC with requested information, as required by § 8-47-201, C.R.S. 2003. A hearing was set for September 24, 2003.
On July 30, 2003, the DOWC procured permission from the ALJ to serve twenty-one requests for admission upon the employer. The ALJ directed that the employer respond by August 25, 2003, or the requests for admission would be deemed admitted. The employer did not respond to the requests for admission.
On August 28, 2003, the DOWC filed a Motion for Summary Judgment. The motion alleged the matters deemed admitted and the affidavit of an investigator for the Coverage Enforcement Unit of the DOWC, established that the employer failed to carry the required insurance in 2002 and 2003, and the appropriate penalty was one year’s premium or $3,197.48.
The motion further alleged that beginning September 9, 2002, the DOWC sent a series of letters to the employer requesting information concerning the employer’s workers’ compensation insurance coverage. However, despite the letters and personal contacts with the investigator, the employer failed to produce the requested information. The DOWC requested the imposition of penalties of $500 per day commencing September 9, 2002, through the date of the scheduled hearing. The employer did not respond to the motion for summary judgment.
On September 11, 2003, the ALJ entered an order granting the Motion for Summary Judgment and vacating the hearing scheduled for September 24. The ALJ first found that the employer had employees subject to the Act, failed to maintain a policy of workers’ compensation, and continued to operate its business without a policy. Thus, based on the yearly insurance premium estimated by the investigator, the ALJ fined the employer $3,197.48.
Second, the ALJ found the DOWC “first sought workers’ compensation information” from the employer by letter dated September 9, 2002, and followed up by letter and phone conversations on subsequent occasions. However, the ALJ found that the employer willfully failed to respond to the requests for information, and that 379 days elapsed from the date of the September 9 letter to the date of the scheduled hearing. Relying on § 8-43-304(1), the ALJ imposed penalties of $10 per day for a total of $3,790.
The employer filed a petition to review the ALJ’s order. The petition states the employer did not “deliberately” fail to provide information to the DOWC. The employer further notes that a hearing was scheduled for September 24, 2003, and states the employer believed it could present its “entire defense” at that time. Finally, the petition states that the employer has never been involved in litigation and is uninformed concerning legal documents and procedures.
The employer filed a brief in support of the petition. However, the brief was filed beyond the deadline established by the Division of Administrative Hearings. Therefore, the brief has not been considered. Rule of Procedure VII (D)(4), 7 Code Colo. Reg. 1101-3 at 20 (a request for extension of time to file a brief shall be filed within the time period specified for filing of the brief or the request shall be denied).
I.
We first consider the ALJ’s imposition of a fine based on the employer’s failure to carry workers’ compensation insurance. We understand the employer’s petition to review as arguing the employer was entitled to a hearing to present its defenses, and that its status as pro se litigant excuses its failure to reply to the requests for admission and the motion for summary judgment. We conclude that there is a material issue of fact with respect to the amount of the penalty to be assessed, and the matter must be remanded for a hearing on this issue.
Initially, we reject the employer’s argument that its unfamiliarity with legal documents and proceedings excuses its procedural defaults. pro se litigant is presumed to know the law and must accept the consequences of procedural errors resulting from its decision to litigate the case without benefit of counsel. Dyrkopp v. Industrial Claim Appeals Office, 30 P.3d 821 (Colo.App. 2001).
We now turn to the question of whether, and to what extent, the employer may be entitled to a hearing concerning the fine for failure to carry insurance. In this regard, we note that summary judgment is a drastic remedy and is not warranted unless the moving party demonstrates it is entitled to judgment as a matter of law. Van Alstyne v. Housing Authority of Pueblo, 985 P.2d 97 (Colo.App. 1999). All doubts as to the existence of disputed facts must be resolved against the moving party, and the party against whom judgment is to be entered is entitled to all favorable inferences that may be drawn from the facts. Further, failure to file an affidavit in opposition to a motion for summary judgment does not relieve the moving party of its burden to establish entitlement to summary judgment. People v. Hernandez and Associates, Inc., 736 P.2d 1238
(Colo.App. 1986). Nevertheless, an ALJ may dispose of a case without a hearing if the record demonstrates there are no disputed issues of material fact and a party is entitled to the entry of an order as a matter of law. See Service Supply Co. v. Vallejos, 169 Colo. 14, 452 P.2d 387 (1969), Provo v. Industrial Claim Appeals Office, 66 P.3d 138
(Colo.App. 2002), aff’d. in part rev’d. in part on other issues, Dworkin, Chambers Williams, P.C. v. Provo, ___ P.3d ___ (Sup.Ct. No. 02SC792, December 1, 2003).
Here, the record supports the order for summary judgment to the extent that the ALJ found the undisputed facts establish the employer was notified of the scheduled hearing, the employer had employees subject to coverage, the employer failed to obtain and maintain workers’ compensation insurance since September 9, 2002, and the employer continued to operate its business. See § 8-43-409(2), C.R.S. 2003. These facts were deemed admitted by the employer’s failure to respond to the requests for admission. Section 8-43-207(1)(e), C.R.S. 2003 (ALJ may for good cause shown permit parties to engage in discovery); C.R.C.P. 36(a) (matter deemed admitted unless party responds to request for admission within time allotted by court).
However, § 8-43-409(1)(b)(I), C.R.S. 2003, provides that when a fine is imposed pursuant to this section the following parameters apply:
Impose a fine of not more than five hundred dollars for every day that the employer fails or has failed to insure or keep the insurance required by articles 40 to 47 of this title in force, or allows or has allowed the insurance to lapse, or fails or has failed to effect renewal of such coverage; except that the director shall not impose a fine that exceeds the annual cost of the insurance premium that would have been charged for such employer. (Emphasis added).
Thus, the amount of fine to be imposed is discretionary provided it does not exceed the caps of $500 per day or the cost of one year’s premium. Inherent in such discretionary authority is the right to submit evidence which might mitigate the amount of the penalty, and to confront evidence of aggravating circumstances. Cf. Marple v. Saint Joseph Hospital, W.C. No. 3-966-344 (September 15, 1995) (amount of penalty to be imposed by ALJ pursuant to § 8-43-304(1) is discretionary provided ALJ imposes at least one cent for each day of the violation).
Here, the employer was not asked to admit that a penalty in the amount of one year’s premium was appropriate, and cannot be deemed to have admitted this contention. Further, the affidavit of the investigator offers the “opinion” that a penalty equal to one year’s premium is appropriate. However, even the affidavit states that the employer offered reasons for its actions which might be deemed mitigating, even if legally mistaken.
Under these circumstances, the ALJ erred in granting summary judgment with respect to the amount of the fine to be imposed. Because the amount of the fine is discretionary and the employer did not admit that any particular amount is appropriate, the DOWC has failed to demonstrate that it is entitled to a penalty of $3197.48 as a matter of law. Rather, the amount of the penalty to be imposed remains a disputed issue of fact. Thus, the employer is entitled to a hearing at which it may present evidence concerning the amount of penalties to be imposed, and to confront any adverse evidence offered by the DOWC. Division of Workers’ Compensation v. Silva Floor Solutions, W.C. Invoice No. 2002-50381 (Corrected Order of Remand, January 9, 2004).
II.
We next consider the employer’s right to a hearing concerning the penalty imposed for failure timely to provide information as required by § 8-47-201. This statute provides as follows:
Every employer receiving from the division any blanks with directions to fill out the same or requests for information required for the purposes of articles 40 to 47 of this title shall properly fill out the blanks and furnish information so requested fully and correctly. The director may require that any information requested by the division be verified under oath and may fix the time within which said information shall be returned. (Emphasis added).
Section 8-43-304(1) provides for penalties up to $500 per day if an employer violates any provision of the Act. Section 8-43-305, C.R.S. 2003, provides that each day an employer fails to perform a duty imposed by the Act constitutes a separate violation.
Initially, we conclude the record supports the ALJ’s determination that the employer failed to comply with the request for information mailed on September 9, 2002, and the employer is not entitled to a hearing on this issue. The employer failed to respond to the requests for admission, and this factual issue is deemed admitted. C.R.C.P. 36(a).
The ALJ commenced the $10 per-day penalty for failing to provide the requested information on September 9, 2002, the day the DOWC mailed the first request for information to the employer. However, the record does not support this date as the commencement date for the penalty. The DOWC’s letter is not contained in the record, and therefore, it cannot be shown that the Director demanded a response the same date the letter was mailed. Indeed, this seems doubtful. We do note that Rule of Procedure XI (B)(4), 7 Code Colo. Reg. 1101-3 at 39, provides that any person or entity “shall have fifteen (15) days from the date of mailing to complete and return any requests for release of medical, financial or any other information as allowed by law.” Thus, in the absence of other evidence, this rule could provide a commencement date for the penalty. On remand, the ALJ shall re-determine the commencement date for the penalty.
Moreover, as noted above, § 8-43-304(1) establishes a minimum penalty of one cent per day and a maximum penalty of $500 per day for each day the Act is violated. Because the amount of penalty is discretionary and the employer did not admit that penalties of $10 per day are appropriate, the record does not establish that the DOWC is entitled to penalties in this amount as a matter of law. Consequently, the employer is entitled to a hearing concerning the amount of penalties to be imposed for failure to provide information. Cf. Division of Workers’ Compensation v. Silva Floor Solutions, supra.
IT IS THEREFORE ORDERED that the ALJ’s order dated September 11, 2003, is set aside insofar as it determined the amount of the fine to be imposed for the employer’s failure to insure. Concerning that issue, the matter is remanded for a hearing and entry of a new order. The ALJ’s order is affirmed insofar as it determined the employer is subject to a fine under § 8-43-409(1).
IT IS FURTHER ORDERED that the ALJ’s order is set aside insofar as it determined the employer is subject to a penalty commencing September 9, 2002, based on failure to respond to the DOWC’s request for information. On remand, the ALJ shall re — determine the date the penalty commences, and may conduct a hearing to ascertain the facts concerning this issue. The order is further set aside insofar as it determined that penalties are to be assessed at the rate of $10 per day. The ALJ shall conduct a hearing concerning the amount of penalties to be imposed. The ALJ’s order is affirmed insofar as it determined as a matter of fact that the employer did not respond to the request for information, and therefore, violated the Act.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________ David Cain
______________________________ Dona Halsey
Copies of this order were mailed to the parties at the addresses shownbelow on January 13, 2004 by A. Hurtado.
Deborah Burns, Sundance Equestrian Center, 3776 W. Parker Rd., Parker, CO 80134-9310
Carol Walker, Coverage Enforcement Unit, Tower 2, #620, Division of Workers’ Compensation — Interagency Mail
Y. E. Scott, Esq., State Services Section, 1525 Sherman St., 5th floor, Denver, CO 80203 (For Division)