TERESA LUNBECK, Employee, Claimant,
v.
FIRSTGROUP AMERICA INC, Employer,
and
NEW HAMPSHIRE INSURANCE CO, LT, Insurer, Defendants.
AWCB Decision No. 17-0107
AWCB No. 201112249
Alaska Workers' Compensation Board
September 5, 2017
FINAL DECISION AND ORDER
Kelly
McNabb, Designated Chair
FirstGroup
America and New Hampshire Insurance Company's (Employer)
March 31, 2017 petitions to dismiss the case pursuant to AS
23.30.110(c) and AS 23.30.015(h) were heard on July 20, 2017
in Fairbanks, Alaska. The original hearing date of July 6,
2017 was selected on April 28, 2017. The board rescheduled
the hearing to July 20, 2017, with the consent of the
parties. Non-attorney representative Terry Smith appeared and
represented Teresa Lunbeck (Employee). Attorney Krista
Schwarting appeared and represented Employer. Witnesses
included Employee, her former attorney John Franich, and Mr.
Franich's paralegal Heidi Wilson. The record remained
open so Employer could file documentation supporting its lien
against Employee's third-party settlement. The record
closed when the panel deliberated on August 3, 2017.
ISSUES
Employer
contends Employee did not file an Affidavit of Readiness for
Hearing (ARH) on her September 6, 2012 workers'
compensation claim (WCC). Employer concedes Employee filed an
ARH within two years of the post-claim controversion, but
argues the ARH specifically listed Employee's September
11, 2013 WCC appealing her denial of eligibility for
reemployment benefits and did not preserve her right to
pursue other benefits listed in her September 6, 2012 claim.
Employee
contends an ARH is not required, that it is directory rather
than mandatory, and relies on Kim v. Alyeska Seafoods,
Inc., 197 P.3d 193 (Alaska 2008). Employee also contends
she never received Employer's September 25, 2012
controversion and that all benefits should therefore be
re-instated.
1)
Should Employee's September 6, 2012 workers'
compensation claim be dismissed under AS 23.30.110(c)?
Employer
contends Employee's former attorney did not receive
written approval from Employer to accept the third-party
settlement agreement as required by statute. Employer
contends Employee settled for less than Employer's lien.
Employer seeks claim dismissal and an order disbursing the
settlement funds held in Employee's former attorney's
trust account.
Employee
contends she hired counsel to represent her and her plan with
counsel was to continue to pursue her workers'
compensation case after the third-party settlement. She
contends dismissal is inappropriate.
2)
Should Employee's claims be dismissed pursuant to AS
23.30.015(h) ?
FINDINGS
OF FACT
1) On
July 22, 2011, Employee was working as a school bus driver
when she injured her right shoulder by gripping the steering
wheel too hard when a trailer from another vehicle came off
and headed toward the school bus. (Report of Occupational
Injury or Illness, July 28, 2011).
2) On
January 27, 2012, Employer denied Employee's right to
benefits. (Controversion Notice, January 27, 2012).
3) On
May 3, 2012 and August 21, 2012, Employee called the
workers' compensation office about the controversion
notice she received. (ICERS Case Notes, May 3, 2012, August
21, 2012).
4) On
September 6, 2012, Employee filed a WCC for re-injury to her
shoulder and new injury to her neck. Employee, representing
herself, checked every box on the claim form, and then
crossed some boxes out and initialed those changes. Employee
checked: temporary total disability (TTD), temporary partial
disability (TPD), permanent partial impairment (PPI), medical
costs, transportation costs, review of reemployment benefit
decision (checked all boxes underneath this option, including
eligibility, plan review, employee cooperation and
"other" even though she had not been found
ineligible at that time), compensation rate, and the
"other" box in which she wrote "second
independent medical examination" (SJJVIE). Employee
checked and then crossed out: permanent total disability
(PTD), penalty, interest, unfair or frivolous controversion,
and attorney's fees and costs and wrote "not
now." (WCC, September 6, 2012; observations).
5) On
September 26, 2012, Employer filed a Controversion Notice.
The controversion includes a certificate of service
certifying filing and service to Employee, both by mail, on
September 26, 2012. (Controversion Notice, September 25,
2012; observations).
6) On
October 8, 2012, the parties attended a prehearing
conference. The designee listed both the January 27, 2012 and
September 25, 2012 controversions on a summary. (Prehearing
Conference (PHC) Summary, October 8, 2012).
7) On
November 6, 2012, attorney John Franich entered his
appearance for Employee. (Entry of Appearance, November 6,
2012).
8) On
November 7, 2012, the parties agreed to an SJJVIE, but noted
they needed pre-injury medical records. Employee amended her
September 6, 2012 WCC to include attorney's fees and
costs. (PHC Summary, November 7, 2012).
9) On
April 30, 2013, Employee filed a third-party complaint
against Daniel Ward, the driver of the motor vehicle that was
pulling a trailer that detached and struck the bus Employee
was driving. On May 6, 2013, Employee filed a notice in her
workers' compensation case that
she had
filed a third-party action. (Complaint, April 30, 2013;
Notice of Third Party Action, May 6,2013).
10) On
September 3, 2013, the reemployment benefits administrator
designee (RBA) found Employee not eligible for reemployment
benefits. (RBA Letter, September 3, 2013).
11) On
September 11, 2013, Employee filed a WCC for review of the
RBA's September 3, 2013 determination. (WCC, September
11, 2013).
12) On
October 4, 2013, Employer answered Employee's September
3, 2013 WCC. (Answer, October 1, 2013).
13) On
January 27, 2014, Employer denied Employee's September
11, 2013 WCC. (Controversion Notice, January 22, 2014).
14) On
June 10, 2014, Employee formally requested a hearing on her
September 11, 2013 WCC. (ARH, June 10, 2014).
15) On
June 23, 2014, Employer opposed the hearing request.
(Affidavit of Opposition (AO), June 23, 2014).
16) On
July 11, 2014, the parties did not want to set a hearing
because discovery was not complete and Employer was updating
an employer medical examination (EME). (ICERS Case Notes,
July 11,2014).
17) On
February 26, 2015, Employee entered into a third-party
settlement agreement with Daniel Ward and notified Employer
by letter the same day. The letter states the parties settled
the third-party claim for $12,000. Employee acknowledged
Employer had paid $10,423.51 in workers' compensation
benefits and applied the proration formula from Cooper v.
Argonaut Ins. Companies, 556 P.2d 525 (Alaska 1976), by
dividing $10,423.51/$12,000 = 0.8686 and concluded Employer
is responsible for 86.86% of the attorney fees and costs
incurred in the third-party litigation. The representation
agreement between Employee and Franich in the third-party
case provided he would receive one-third of the total
recovery in attorney fees and his out of pocket expenses.
Franich sought reimbursement for: $150 filing fee, $12.50 for
service of process by certified mail, $22.00 check to
Fairbanks Memorial Hospital for records, and $420 for half of
Employee's share of mediator fees (two cases); which
resulted in total costs of $604.50. Franich proposed the...
