FOR PUBLICATION
ATTORNEYS FOR APPELLANT:
DONALD S. SMITH
MICHAEL PATRICK DUGAN
Riley Bennet & Egloff
Indianapolis, Indiana
IN THE COURT OF APPEALS OF INDIANA
LAGARDA SECURITY, )
)
Appellant-Defendant, )
)
vs. ) No. 93A02-0401-EX-14
)
ALVA LAWALIN, )
)
Appellee-Plaintiff. )
APPEAL FROM THE WORKERS COMPENSATION BOARD
The Honorable Terrence Coriden, Chairman
Cause No. C-160686
July 30, 2004
OPINION - FOR PUBLICATION
SHARPNACK, Judge
The Single Hearing Member does not find these reasons to be of a
sufficient character and severity as to warrant the setting aside of an Award
related to an injury that occurred nearly two years ago and with respect
to which [LaGarda] has only recently begun participating in the proceedings. To
allow corporate mismanagement and upheaval to be a sufficient basis for setting aside
an Award, the burden of monitoring corporate internal affairs of a company would
shift onto injured workers.
The Single Hearing Member notes that although [LaGarda] never responded to any notice
of pre-trial or hearing in this matter it made an immediate response to
the Award in this matter.
Even were the cited circumstances deemed to warrant the setting aside of the
Award, the Workers Compensation system in Indiana provides a safety net whereby the
workers compensation insurance carrier will receive notice of claims and hearings even if
the employer [LaGarda] is unable to track its claims. For that reason,
among others, the existence and nature of coverage is required to be reported
to the Board. Although [LaGarda] presented evidence that a workers compensation insurance
policy existed to cover [Lawalin] on the date of his injury, it provided
no evidence that the proper notification to the Board of that coverage has
ever been made. Again, burdening [Lawalin] with a neglect not of his
making would be [an] anathema to the purpose of the Act.
Although [LaGardas] representative testified to having examined the file and having spoken to
witnesses as to this claim, no medical evaluation of Plaintiffs condition has yet
been undertaken by [LaGarda].
The Motion to Set Aside Award filed February 10, 2003 should be and
hereby is DENIED.
Appellants Appendix at 8. Upon LaGardas application for review by the full
Board, the Board adopted the single hearing members findings and conclusions.
The sole issue is whether the Board erred by denying LaGardas motion to
set aside the workers compensation award in favor of Lawalin.
See footnote Indiana Code
§ 22-3-4-8(b) (1998) provides that an award by the full board shall be
conclusive and binding as to all questions of the fact, but either party
. . . may . . . appeal to the court of appeals
for errors of law under the same terms and conditions as govern appeals
in ordinary civil actions. Accordingly, we apply a deferential standard of review
under which we are bound by the Boards findings of fact and may
not disturb its determination unless the evidence is undisputed and leads undeniably to
a contrary conclusion.
Greenberg News Network v. Frederick, 793 N.E.2d 311, 314
(Ind. Ct. App. 2003). We first review the findings to determine if
there is any competent evidence of probative value in the record to support
them. Id. at 315. We may neither reweigh the evidence
nor reassess the credibility of the witnesses. Id. Instead, we must
consider only the evidence, and the reasonable inferences therefrom, most favorable to the
Boards decision. Id. After reviewing the sufficiency of the evidence supporting
the findings, we determine whether those findings are sufficient to support the judgment.
Id.
LaGarda argues that the Board erred by denying its motion to set aside
the award because: (1) the death of its founder and principal owner led
to total chaos in the company; and (2) the rogue manager in charge
of workers compensation claims mishandled the notices and paperwork from the Board.
Appellants Brief at 6, 9-10. LaGarda argues that the exceptional circumstances of
the turmoil at LaGarda Security . . . [were] sufficient to justify setting
aside the award.
See footnote
Id. at 5.
The Board has the power on the application of any interested party to
vacate its own [award] order on application, seasonably and diligently made, where it
appears that any such order is a result of fraud, duress, mistake, or
gross irregularity affecting substantial rights. Rassbach v. Alcala, 775 N.E.2d 353, 359
(Ind. Ct. App. 2002) (quoting Armes v. Pierce Governor Co., 121 Ind. App.
566, 573, 101 N.E.2d 199, 203 (1951)). However, such a petition to
set aside an award should be closely and cautiously examined. Bituminous Cas.
Corp. v. Dowling, 111 Ind. App. 256, 263, 37 N.E.2d 684, 687 (1941).
We find Bituminous instructive in resolving whether the Board erred by denying LaGardas
motion to set aside the award. In Bituminous, the employee and employer
appeared before a single hearing member for a hearing on the employees adjustment
claim, and the Board issued an award in favor of the employee.
Bituminous, 37 N.E.2d at 685-686. Thereafter, the employers workers compensation insurance carrier
moved to vacate the award and to introduce additional evidence and argued that
it did not have the opportunity to do so at the hearing due
to the Boards failure to send it customary notice of the hearing.
Id. The Board found that the insurance carrier had knowledge and notice
of the hearing but had failed to appear, and the Board denied the
insurance carriers motion to vacate the award. Id.
On appeal, the insurance carrier argued that where an interested party is deprived
of its right to appear and defend its interests, a judgment or award
against such a party would violate the [Indiana] Constitution[.] Id. at 687.
We agreed that such a contention was correct as a general statement
but found that it was not applicable where such a party has notice
of the hearing. Id. After noting that the Workers Compensation Act
provided that notice to an employer constitutes notice to the insurance carrier, we
concluded that the Board had evidence before it from which it could have
concluded that the insurance carrier had actual notice of the hearing and held
that there was no gross irregularity that deprived the insurance carrier of any
of its substantial rights. Bituminous, 37 N.E.2d at 686-687; see also Ind.
Code § 22-3-5-5(c)(3) (1998) (providing that an employers notice or knowledge of an
employees injury is imputed to the workers compensation carrier). Thus, we affirmed
the Boards denial of the insurance carriers motion to set aside the award.
Id.
Similar to Bituminous, here, the Board did not err by denying LaGardas motion
to set aside the award because there was no gross irregularity. Lawalin
informed LaGarda that he had injured his neck on the job, and he
was later diagnosed as having a herniated disc in his neck that required
surgery. LaGarda verbally informed Lawalin that his workers compensation claim had been
denied and refused to provide him with a written denial that he could
submit to his health insurance. After Lawalin filed an application for adjustment
of claim against LaGarda with the Board, the Board sent LaGarda notices of
the pre-trial conference and adjustment claim hearing and ordered LaGarda to secure counsel
to represent it. LaGarda did not hire counsel and did not appear
at either the pre-trial conference or the claim hearing. LaGarda only responded
to the Board after the single hearing member issued its award in favor
of Lawalin.
During the hearing on LaGardas motion to set aside the award, a representative
of LaGarda testified that the company had been in total chaos after the
death of LaGardas founding owner and that the employee in charge of workers
compensation claims had the habit of putting things in the back of the
filing cabinet that could not be found. Appellants Appendix at 71.
In denying LaGardas motion, the Board concluded that the corporate upheaval after the
death of LaGardas founder and the improper processing of workers compensation claims were
not reasons of a sufficient character and severity as to warrant the setting
aside of an Award and that to allow corporate mismanagement and upheaval to
be a sufficient basis for setting aside an Award, the burden of monitoring
corporate internal affairs of a company would shift onto injured workers. Appellants
Appendix at 8. The Board further concluded that:
Even were the cited circumstances deemed to warrant the setting aside of the
Award, the Workers Compensation system in Indiana provides a safety net whereby the
workers compensation insurance carrier will receive notice of claims and hearings even if
the employer [LaGarda] is unable to track its claims. For that reason,
among others, the existence and nature of coverage is required to be reported
to the Board. Although [LaGarda] presented evidence that a workers compensation insurance
policy existed to cover [Lawalin] on the date of his injury, it provided
no evidence that the proper notification to the Board of that coverage has
ever been made. Again, burdening [Lawalin] with a neglect not of his
making would be [an] anathema to the purpose of the Act.
Id. We cannot say that the Boards conclusions are erroneous. Thus,
we conclude that the Board did not err by denying LaGardas motion to
set aside the award. See, e.g., Bituminous, 37 N.E.2d at 685-686; see
also Armes, 121 Ind. App. at 575-576, 101 N.E.2d at 203-204 (reversing the
Boards denial of an employees motion to vacate its order denying compensation after
finding a gross irregularity affecting the employees substantial right to cross-examine a Board-appointed
doctor where the Board failed to provide notice to the employee of a
hearing in which the Board-appointed doctor testified).
For the foregoing reasons, we affirm the Boards order denying LaGardas motion to
set aside the workers compensation award.
Affirmed.
DARDEN, J. and ROBB, J. concur
Except as provided below the industrial board will not be bound by any
technical rules of practice in conducting hearings, but will conduct such hearings and
make such investigations in reference to the questions at issue in such manner
as in its judgment are best adapted to ascertain and determine expeditiously and
accurately the substantial rights of the parties and to carry out justly the
spirit of The Indiana Workmen's Compensation Act (IC 22-3-2 IC 22-3-6)[.]
However, the industrial board incorporates by reference the provisions of Trial Rules 26
through 37 [the rules regarding depositions and discovery], as amended, of the Indiana
Rules of Trial Procedure, into this rule.
631 IAC 1-1-3. Thus, Ind. Trial Rules 55 and 60 regarding setting
aside a default judgment are not applicable to the Boards order denying LaGardas
motion to set aside the award.
See 631 IAC 1-1-3; see also
Clary v. Natl Friction Prods., Inc., 259 Ind. 581, 586, 290 N.E.2d 53,
56 (1972) (holding that the Ind. Trial Rules do not apply to actions
before the Board); Josam Mfg. Co. v. Ross, 428 N.E.2d 74, 75 (Ind.
Ct. App. 1981), (stating that the Ind. Trial Rules, except Trial Rules 26
through 37, do not govern or bind the Board), rehg denied.