W.C. No. 4-148-045Industrial Claim Appeals Office.
December 21, 2000
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Stuber (ALJ) insofar as the ALJ denied the claim for penalties. We affirm.
The claimant suffered a compensable injury in 1992 The respondents admitted liability for temporary disability benefits commencing September 15, 1992. On April 30, 1996, the respondents filed a Final Admission of Liability which terminated temporary disability benefits, and admitted liability for the payment of permanent partial disability benefits from April 8, 1996 through May 29, 1997, in the amount of $19,995.74, based on 12 percent whole person impairment. On December 10, 1997, the respondents filed a General Admission of Liability for the payment of additional temporary disability benefits commencing October 10, 1997. The General Admission stated that previously paid permanent partial disability benefits would be credited against the payment of temporary disability benefits pursuant to Donald B. Murphy Contractors, Inc., v. Industrial Claim Appeals Office, 916 P.2d 611 (Colo.App. 1995), and the $60,000 benefit cap in § 8-42- 107.5, C.R.S. 2000.
Subsequently, in an order dated March 31, 1998, the ALJ awarded the claimant permanent total disability benefits commencing February 5, 1998. On November 9, 1999, the respondents filed a General Admission of Liability for permanent total disability benefits. The admission also asserted an overpayment of $20,163.66. However, the General Admission did not identify the previous payment of permanent partial disability benefits. On January 3, 2000, the respondents filed another General Admission of Liability which asserted an overpayment of $17,955.52 for previously paid permanent partial disability benefits. However, the admission did not contain an admission for permanent partial disability.
The claimant contested the asserted overpayment. The claimant also sought penalties under § 8-43-304(1), C.R.S. 2000, on grounds that the November 1999 and January 2000 general admissions of liability violated Rule of Procedure Part IV(K)(1), 7 Code Colo. Reg. 1101-3 at, 6.01, “§ 8-43-203(1)” and § 8-43-402, C.R.S. 2000.
The ALJ determined the asserted overpayment was incorrect because the claimant did not receive contemporaneous temporary and permanent partial disability benefits or contemporaneous permanent partial and permanent total disability benefits. However, the ALJ found that the respondents filing of the “general” admissions of liability for permanent total disability benefits did not violate Rule IV(K)(1) because the rule governs “admitted” liability. Furthermore, the ALJ was not persuaded the respondents violated §8-43-203 or § 8-43-402 by their assertion of the $20,000 overpayment. Therefore, the ALJ refused to impose penalties under § 8-43-304(1).
On appeal the claimant renews the arguments which were considered and rejected by the ALJ. We conclude the ALJ properly denied the claim for penalties.
I.
Initially we note the claimant’s “Designation of Record” included the “entire files maintained by the Division of Workers’ Compensation” as part of the record on review. It appears that only the Division of Administrative Hearings file record was transmitted to us for review, but there is no indication that the entire Division of Workers’ Compensation file was part of the record made before the ALJ. See Rule of Procedure Part VIII(A)(7), 7 Code Colo. Reg. 1101-3 at 22. Consequently, we have not considered the entire Division of Workers’ Compensation file.
II.
Section 8-43-304(1) allows an ALJ to impose penalties of up to $500 per day on an insurer “who violates any provision of articles 40 to 47 of this title,” but only when the Workers’ Compensation Act (Act) does not create a separate penalty for the specific conduct in question. Sears v. Penrose Hospital, 942 P.2d 1345 (Colo.App. 1997). In order to impose penalties under this statute, the ALJ must first determine that the disputed conduct constituted a violation of an express duty or prohibition established by the Act. Allison v. Industrial Claim Appeals Office, 916 P.2d 623 (Colo.App. 1995).
Rule IV(K)(1) provides that where the insurer admits liability for permanent total disability benefits, the insurer shall “file an admission of liability for permanent total disability on a final admission of liability form prescribed by the Division.” (Emphasis added). However, the rule does not impose any duty to file an admission where the respondents’ liability for permanent total disability benefits is the result of an order by an ALJ, and we may not read non existent provisions into the Rule. See Schelly v. Industrial Claim Appeals Office, 961 P.2d 547 (Colo.App. 1997); cf Calkins v. Albi, 163 Colo. 370, 431 P.2d 17 (1967) (statutes penal in nature strictly construed against party seeking penalties).
Here, the respondents did not “admit” liability for permanent total disability benefits. Rather, they were ordered to pay permanent total disability benefits after a fully contested evidentiary hearing on the issue. Furthermore, the ALJ’s March 31 award does not require the respondents to file any admission of liability. Under these circumstances, we agree with the ALJ that the respondents were not required to comply with Rule IV(K)(1). Therefore, the ALJ did not err in refusing to impose penalties for a violation of Rule IV(K)(1).
Moreover, the obvious purpose of Rule IV(K)(1) is to provide notice to the claimant and the Division of Workers’ Compensation that the claimant’s entitlement to permanent total disability benefits is uncontested as to the rate and payment schedule contained in the admission. The purpose of Rule IV(K)(1) was fulfilled by the ALJ’s order which explicitly required the respondents to pay permanent total disability benefits at the rate of $335.95 per week commencing February 5, 1998, and for the remainder of the claimant’s life. The March 31 order also required the respondents to pay future medical benefits as provided by Grover v. Industrial Commission, 759 P.2d 705 (Colo. 1988). The claimant’s appellate rights concerning awards of permanent total disability and medical benefits are governed by the notice contained in the March 31 order. See § 8-43-301(2), C.R.S. 2000. Thus, it is immaterial that the respondents’ general admission failed to contain notice of the claimant’s appellate rights.
III.
Next, we agree with the ALJ that the claimant failed to prove a violation of § 8-43-203(2)(d), C.R.S. 2000, and HLJ Management Group v. Kim, 804 P.2d 250 (Colo.App. 1990). Section 8-43-203(2)(d) provides that where the respondents admit liability, “payments shall continue according to admitted liability.” HLJ holds that respondents may not retroactively withdraw an admission of liability. Instead, the respondents must pay benefits in accordance with admitted liability until the entry of an order which relieves the respondents of liability. See Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 99CA1624, June 22, 2000).
Admittedly, the respondents’ November 1999 and January 2000 general admissions of liability failed to reference the respondents’ prior admission for permanent partial disability benefits. Nevertheless, the record supports the ALJ’s finding that neither admission reflects an attempt to withdraw the previous admission of liability. To the contrary, the respondents paid all benefits due in accordance with the previous admission of liability for permanent partial disability benefits prior to their reinstatement of temporary disability benefits in October 1997 and prior to the award of permanent total disability benefits. In fact, the alleged overpayment was the result of the respondents’ payment of permanent partial disability benefits. Therefore, the ALJ correctly refused to impose penalties for a violation of §8-43-203(2)(d).
IV.
Finally, we conclude the ALJ properly refused to impose penalties under § 8-43-304(1) for a violation of § 8-43-402. That statute provides:
“If, for purposes of obtaining any order, benefit, award, compensation, or payment under the provisions of articles 40 to 47 of this title, either for self- gain or for the benefit of any other person, anyone willfully makes a false statement or representation material to the claim, such person commits a class 5 felony and shall be punished as provided in section 18-1-105 C.R.S., and shall forfeit all right to compensation under said articles upon conviction of such offense.”
Section 8-43-402 contains a specific penalty for the willful misrepresentation of a material fact. Consequently, even if the November 1999 and January 2000 general admissions contained willful misrepresentations, the misrepresentation does not support the assessment of penalties under § 8-43-304(1). In view of our conclusions, we need not address the claimant’s contention the ALJ erroneously found the respondents’ failure to list the previous permanent partial disability payments in the November 1999 and January 2000 general admissions were not willful misrepresentations of the amount of benefits owed the claimant.
To the extent the claimant has raised other arguments, they are not persuasive.
IT IS THEREFORE ORDERED that the ALJ’s order dated April 14, 2000, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2000. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed December 21, 2000 to the following parties:
Karen Malloy, 351 7th St., #19, Limon, CO 80828
Lincoln Community Hospital, 7335 E. Orchard Rd., #200, Englewood, CO 80111-2512
Colorado Hospital Association Trust, Sharon Thompson, Support Services, Inc., P. O. Box 3513, Englewood, CO 80155
Steven U. Mullens, Esq., P. O. Box 2940, Colorado Springs, CO 80901-2940 (For Claimant)
Fred Ritsema, Esq., 999 18th St., #3100, Denver, CO 80202 (For Respondents)
BY: A. Pendroy