Office of Administrative Law Judges
United States Department of Labor
MONTHLY DIGEST # 127
November 1996 - January 1997
James Guill
Associate Chief Judge for Longshore
Thomas M. Burke
Acting Associate Chief Judge for Black Lung
A. Circuit courts of appeal
In Ingalls Shipbuilding, Inc. v. Director, OWCP, ___ F.3d ___,
1996 U.S. App. LEXIS 33493 (5th Cir. Dec., 19, 1996), the court granted petitions for rehearing
in these claims involving § 33(g) issues wherein the district director declined to refer the
claims for a hearing before the administrative law judge upon the requests of employers/carriers.
The court withdrew its earlier opinion, reported at 81 F.3d 561 (5th Cir. 1996), and directed that
its December 1996 opinion be substituted in its stead. On rehearing, the court clarifies that the
district director's functions are ministerial in nature and the statute, as codified at 33 U.S.C.
§ 919(c), "clearly defines the time that a right to a hearing before an ALJ accrues (is)
upon application,'" and the district director is without discretion in determining whether to
refer a claim for such a purpose once a request is made. Therefore, where the district director
granted the withdrawal of claims upon claimants' requests, but after the employers/carriers
requested a hearing, such conduct exceeded the scope of the district director's authority as it
"denies the party requesting the hearing its procedural due process rights under the
LHWCA." The court further noted that "transferring the claim to the OALJ does not
deny the procedural right of the claimant to withdraw the claim, because the ALJ is authorized to
consider motions to withdraw following the transfer." Indeed, the Fifth Circuit held that
Employer was "denied its procedural rights when the motion for withdrawal was
considered by the district director, an administrative officer."
[ 19.1, claim must be referred for hearing/powers of the district director ]
In Papai v. Harbor Tug & Barge
Co., 67 F.3d 203 (9th Cir. 1995), cert. granted (oral argument heard on January
13, 1997), the Ninth Circuit applied a "totality of the circumstances" test to
determine whether an injured employee, who was hired by different employers through a union
hiring hall, had "seaman status" and was, therefore, covered by the Jones Act as
opposed to the LHWCA. The court held the following:
The proper inquiry is whether plaintiff's relationship with a vessel (or group of
vessels) was substantial in terms of duration and nature, which requires
consideration of the total circumstances of his employment. Scrutiny of the total
circumstances' is, necessarily, fact specific. On one hand, the status of a worker
may change by a change in the work assignment. On the other hand, it may be
necessary to examine the work performed by the employee while employed by
different employers during the relevant time period.
As a result, the court concluded that "[t]here would appear to be no reason that a group of
employers who join together to obtain a common labor pool on which they draw by means of a
union hiring hall . . ., should not be treated as a common employer for purposes of determining a
maritime worker's seaman status."
In addition, the court concluded that a worker's pursuit of a compensation
claim under the LHWCA does not preclude a subsequent Jones Act claim.
[ 1.4.2 seaman status/coverage under the Act v. Jones Act ]
B. Benefits Review Board
In Pool v. General American Oil Co., ___ B.R.B.S. ___, BRB No.
96-314 (Nov. 8, 1996), the Board held that the 1984 amended version of § 33(g) was
applicable to the claim where Claimant was injured in 1977 but the case "did not come
before an administrative law judge until 1993" such that it was pending on the effective
date of the amendments, i.e. September 28, 1984. Moreover, the Board concluded that a
federal district court judgment which led to a Rule 68 Offer of Judgment by third-party
defendents upon which a settlement was negotiated constituted a "settlement" within
the meaning of § 33(g). In addition, the Board concluded that Employer's participation in
the federal district court case as an intervenor was not sufficient to render § 33(g)
inapplicable nor did it constitute constructive approval of the settlement. Rather, Employer must
provide actual written approval of the settlement.
Finally, the Board held that it is possible to determine the amount of future
compensation benefits to which Claimant will be entitled and whether the amount obtained by
Claimant exceeded that to which he would be entitled such that § 33(g) would not bar his
recovery under the Act.
[ 33.7 prior written approval under § 33(g) ]
In Barnes v. General Ship Service, ___ B.R.B.S. ___, BRB No.
95-2177 (Nov. 13, 1996), the Board upheld the administrative law judge's order granting
summary judgment in a case involving § 33(g) of the Act. Specifically, the Board
concluded that § 33(g) applied to the post-death third party settlements entered into by
Claimant, thus barring her from further recovery under the Act as she did not receive Employer's
prior written approval of the settlements. In this vein, the Board declined to adopt Claimant's
argument that the settlements were executory, and therefore not final, where (1) she signed cover
letters to the settlements that Employer/Carrier's approval would be required, and (2) in the
interim the settlement proceeds were being held in trust by Claimant's counsel pending approval
by the Employer/Carrier. The Board noted the following:
The settlement releases themselves contain no provision requiring that employer's
approval be obtained; in accordance with the written terms of the releases,
settlement proceeds were paid to claimant's attorney as trustee and the civil
actions were dismissed with prejudice against three of the third-party
defendents.
. . .
Claimant avers that the employer approval condition outlined in the cover letters
as well as other documents which post-date the releases allows claimant to return
the settlement proceeds to the defendents and rescind the settlements should she
be unable to obtain employer's approval of the settlements. Recission of a
agreement, however, must return both parties to the settlement to the status
quo ante, and, here, the court's dismissal with prejudice of the third party
actions forecloses a restoration of the parties' original positions.
As a result, the Board concluded that the settlements with three of the third-party defendents
were fully executed and § 33(g)(1) barred recovery of further benefits under the Act.
[ 33.7 prior written approval under § 33(g) ]
In Wilson v. Crowley Maritime, ___ B.R.B.S. ___, BRB Nos. 95-1554 and 96-0607 (Nov. 20, 1996), the Board held that the administrative law judge properly
found that an injured employee was covered by the Act where he "spent seventy-five
percent of the time aboard employer's barges, (and) the barges were tied to the deck for loading
during these periods." The Board noted that "claimant was a land-based employee in
that he lived on shore, had a shore-based office, and except for a few occasions, in emergency
situations, claimant never went to sea with the barges."
The Board further concluded that, where Claimant established a prima
facie case of total disability because he was not able to perform his usual employment,
Employer failed to find suitable alternative employment (SAE) where Claimant resided.
Specifically, Claimant was injured in the Portland/Vancouver area, relocated to Seattle, and
returned to the Portland/Vancouver area "due to the dissolution of his marriage, his failure
to obtain employment, and his financial hardship." Thus, employment opportunities
presented by Employer for the Seattle area did not support a finding of SAE for Claimant; rather,
the Board found that "the Portland/Vancouver area (was) the relevant labor market in this
case." The Board further noted, with regard to Employer's job listing, that "claimant
did not have the requisite skills or experience, the jobs required physical activities inconsistent
with claimant's limitations, and/or the specific jobs were not available at the time claimant
contacted the potential employers."
In Boyd v. Ceres Terminals, ___ B.R.B.S. ___, BRB Nos. 96-526
and 96-526A (Jan. 3, 1997), the Board held that Claimant's injury, which arose as he assisted a
co-worker in pouring gasoline in a co-worker's carbeurator, occurred during the course of his
employment. In so holding, the Board stated the following:
While the act of pouring the gasoline in the carburetor to start the car may have
been a personal' activity designed to benefit (a co-worker), the deviation from
claimant's duties was at most minimal. The car was in the direct path from the
locker room to claimant's forklift, and the aid, according to the claimant's credited
testimony, should have taken no more than a few seconds. Therefore, any
deviation from his employment was insubstantial.
Moreover, the Board held that, because Employer "knew of the accident and the full extent
of claimant's injuries prior to receiving information on the health insurance form indicating that
the injury was non-industrial," the claim was not barred under § 12 for failure to
provide written notice of the injury with Employer or the district director.
Finally, the Board upheld the judge's denial of compensation for
disfigurement under § 8(c)(20) of the Act. In so holding, the Board noted that
"claimant is correct in asserting that he need not show that a disfigurement to the head,
neck, or face impeded his employability, (but) he is incorrect in asserting an automatic right to
disfigurement benefits." The Board stated that "[o]nly serious disfigurement is
compensable." Therefore, because Claimant was not on medication, had no physical
complications, was not in need of surgery, and returned to work with no reduction in seniority, he
was not entitled to compensation for disfigurement.
[ 2.2.2, injury arising out of employment; 12.4.3, employer not
prejudiced/failure to file written notice of injury; 8.3.24, disfigurement
]
In Phillips v. A-Z International, ___ B.R.B.S. ___, BRB No. 96-564 (Dec. 23, 1996), the Board held that an administrative law judge cannot award repayment of
compensation paid by Employer nor award Employer's attorney's fees and costs against Claimant
under § 27(b) of the Act. The Board noted that, in applying § 27(b), "[t]he
administrative law judge in the present case found that a fraudulent claim of injury equates to
fraud against the administrative process which qualifies as disobedience to a lawful process'
within the meaning of § 27(b)."
The Board held, to the contrary, that the judge was without authority to
assess such sanctions as "claimant in this case has not refused to comply with a lawful
order of the administrative law judge, nor is there any contention that he did so." The
Board determined that the "term (process) refers to the use of summons, writs, warrants, or
mandates issuing from a court in order to obtain jurisdiction over a person or property."
On the other hand, the Board noted that § 31(a) provides that the United States Attorney
investigate any complaint of fraud and this is the avenue of relief in a claim involving fraud such
that "employer may not achieve the result of recoupment of previously paid compensation
through a broad reading of the contempt provisions of section 27 of the Act . . .."
[ 27.3, sanctions for fraudulent claim; 31.1, penalty for
misrepresentation of claim ]
In Barker v. Bath Iron Works Corp., ___ B.R.B.S. ___, BRB Nos.
96-0443 and 96-0443S (Nov. 20, 1996), the Board held that it was without authority to extend
the one year time period within which it must render a decision under the Act pursuant to Public
Law No. 104-134. However, the Board also concluded that "[i]n consolidated cases, . . .
the one-year period referenced in the aforementioned laws . . . commence(s) on the date of the
later appeal."
[ one year time limitation for Board to rule on appeal under the Act
]
In Stone v. Ingalls Shipbuilding, Inc., ___ B.R.B.S. ___, BRB No.
96-358 (Nov. 22, 1996), the Board concluded that Claimant was not covered under the Act as she
failed to meet the status requirement of § 2(3) to state that "although claimant may
perform a function that is integral to the shipbuilding process, she works in an office setting and
her visits to the ships were merely incidental to her clerical work."
[ 1.11.7, excluded from coverage/clerical ]
In Nelson v. American Dredging Co., ___ B.R.B.S. ___, BRB No.
96-0360 (Nov. 22, 1996), the Board held that, where Employer did not raise the issue of coverage
before the district director but listed it on the LS-18 and "the issue was addressed by the
parties during the formal hearing before the administrative law judge," then the issue was
timely raised and the judge properly considered it in his decision. On a related point, the Board
upheld the judge's finding that Claimant was not covered under the Act as his injury occurred on
the beach which was not considered an "adjoining area" because it was not used for
one of the maritime purposes set forth under the Act. Moreover, Claimant did not satisfy the
status test at § 2(3) as the judge "found that claimant's bulldozing activities in
furtherance of a beach renourishment project had no relationship with either maritime commerce
or the construction or repair of vessels."
[ 2.3, status under § 2(3); 19.02, issues at the hearing
]
In Story v. Navy Exchange Service Center, ___ B.R.B.S. ___, BRB
Nos. 96-0533 and 96-0533A (Jan. 9, 1997), the Board vacated an administrative law judge's
finding that tips do not constitute part of the average weekly wage under § 2(13) of the Act
and remanded the case to state that "if the contract of hire between Claimant and Employer
contemplated tips as part of the money rate' at which Claimant was to be compensated, then
Claimant's tips must be included in her average weekly wage."
