IN RE MARY DOUVILLE, Employee, by STATE, DEP'T OF LABOR & INDUS., Petitioner/Appellant, v. JOANN STORES, INC., and KEMPER INS. CO., Employer-Insurer.
WORKERS= COMPENSATION COURT OF APPEALS
JUNE 20, 2002
PENALTIES; NOTICE OF DISCONTINUANCE; STATUTES CONSTRUED - MINN. STAT. ' 176.101, SUBD. 1(h). Nothing in Minn. Stat. ' 176.101, subd. 1(h), indicates legislative intent to supersede the discontinuance provisions of Minn. Stat. '' 176.238 and 176.239. Where the employer and insurer improperly discontinued benefits based on the employee=s release to return to work without restrictions, and benefits were in fact due through the date of filing of the NOID, the Department=s penalty assessment was justified, and the compensation judge=s decision to the contrary must be reversed.
Reversed and penalties reinstated.
Determined by Wilson, J., Johnson, C.J., and Pederson, J.
Compensation Judge: Donald C. Erickson.
DEBRA A. WILSON, Judge
The Workers= Compensation Division of the Department of Labor and Industry [the Department] appeals from the compensation judge=s dismissal of penalties assessed by the Department against JoAnn Stores, Inc., the employer herein. We reverse the judge=s decision and reinstate the penalty assessment.
The pertinent facts in this matter are undisputed. The employee developed carpal tunnel syndrome as a result of her work activities for JoAnn Stores, Inc. [the employer], which was insured against workers= compensation liability by Kemper Insurance Company. The employer and insurer voluntarily paid the employee temporary total disability benefits following right carpal tunnel release surgery. On May 24, 2000, the employer and insurer filed a Notice of Intention to Discontinue Benefits [NOID], alleging that the employee had been released by her doctor to return to work, without restrictions, as of May 16, 2000, and indicating that temporary total disability benefits would be discontinued effective May 16, 2000. The employee did not file an objection or otherwise contest the discontinuance. However, the Department subsequently notified the insurer that the insurer was obligated to pay the employee benefits through the date of filing of the NOID, pursuant to Minn. Stat. ' 176.238, subd. 2. The insurer took the position that no benefits were due after May 16, 2000, and, on June 28, 2000, the Department issued a Notice of Penalty Assessment, for Aretroactive discontinuance,@ assessing penalties in the amount of $387.69, payable to the Assigned Risk Safety Account, and $110.77, payable to the employee. The employer and insurer objected to the penalty assessment, and the matter came on for hearing before a compensation judge on December 3, 2001.
The compensation judge issued his decision on December 11, 2001, concluding that, because the employee had been released to return to work without restrictions on May 16, 2000, her entitlement to temporary total benefits ended on that date pursuant to Minn. Stat. ' 176.101, subd. 1(h). Going on to rule that there was no basis for assessment of penalties based on benefits that were not owed, the judge dismissed the Department=s penalty assessment. The Department appeals.
STANDARD OF REVIEW
A[A] decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which [the Workers= Compensation Court of Appeals] may consider de novo.@ Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993).
In his Findings and Order, the compensation judge indicated that A[t]he employer and insurer stipulate to the accuracy of the Department=s calculation of any available penalties, only disputing whether imposition of penalties was appropriate, at all, under the circumstances. For this reason, and because the pertinent facts are uncontroverted, the sole issue before us is whether the Department=s imposition of penalties was statutorily permissible, based on the employer and insurer=s failure to pay the employee temporary total disability benefits from May 16, 2000, the day of her alleged release to work without restrictions, through May 24, 2000, the date of service of the NOID.
Minn. Stat. ' 176.238, subds. 1 and 2, read in pertinent part as follows:
Subdivision 1. Necessity for notice and showing; contents. Except as provided in section 176.221, subdivision 1, once the employer has commenced payment of benefits, the employer may not discontinue payment of compensation until it provides the employee with notice in writing of intention to do so. A copy of the notice shall be filed with the division by the employer. The notice to the employee and the copy to the division shall state the date of intended discontinuance and set forth a statement of facts clearly indicating the reason for the action. Copies of whatever medical reports or other written reports in the employer=s possession which are relied on for the discontinuance shall be attached to the notice.
Subd. 2. Continuance of employer=s liability; suspension. (a) Discontinuance because of return to work. If the reason for discontinuance is that the employee has returned to work, temporary total compensation may be discontinued effective the day the employee returned to work. Written notice shall be served on the employee and filed with the division within 14 days of the date the insurer or self-insured employer has notice that the employee has returned to work.
(b) Discontinuance for reasons other than return to work. If the reason for the discontinuance is for other than that the employee has returned to work, the liability of the employer to make payments of compensation continues until the copy of the notice and reports have been filed with the division. When the division has received a copy of the notice of discontinuance, the statement of facts and available medical reports, the duty of the employer to pay compensation is suspended, except as provided in the following subdivisions and in section 176.239.
(Emphasis added.) This statute clearly indicates that, except in cases of discontinuance based on a return to work, an employer and insurer must continue to pay benefits through the date of filing of the NOID; no Aretroactive@ discontinuance is allowed. The employer and insurer contend, however, that Minn. Stat. ' 176.238, which was enacted in 1987, was effectively superseded by the 1995 amendments to Minn. Stat. ' 176.101, subd. 1, which specify various events that trigger Acessation@ of temporary total disability benefits. The specific provision cited as grounds for discontinuance in the present case is Minn. Stat. ' 176.101, subd. 1(h), which provides that A[t]emporary total disability compensation shall cease if the employee has been released to work without any physical restrictions caused by the work injury.@ Under the employer and insurer=s theory, an employer and insurer may discontinue temporary total disability benefits, without prior notice to the employee, upon the occurrence of one of the statutory Acessation@ events, as long as an NOID is eventually served and filed. As such, the employer and insurer allege, the retroactive discontinuance of benefits that took place in the present case was expressly authorized by statute. We disagree.
Most of the clauses listed in Minn. Stat. ' 176.101, subd. 1, including the clause at issue here, provide that temporary total disability benefits shall cease Aif,@ not Awhen,@ the specified event occurs. That is, these clauses provide a substantive basis for discontinuance but do not speak at all to either how or when the discontinuance may be accomplished. That aspect of discontinuance remains governed by Minn. Stat. '' 176.238 and 176.239, and related rules. To hold otherwise would require us to presume that the legislature simply overlooked the need to amend Minn. Stat. '' 176.238 and 176.239 in conjunction with its amendment of Minn. Stat. ' 176.101, subd. 1. We see no need to make such a presumption, as our interpretation gives effect to all pertinent statutory provisions. See, e.g., Minn. Stat. ' 645.16 (AEvery law shall be construed, if possible, to give effect to all its provisions@).
In Ansari v. Harold Chevrolet, 336 N.W.2d 276, 36 W.C.D. 49 (Minn. 1983), the Minnesota Supreme Court affirmed a decision of the Worker=s Compensation Court of Appeals upholding a finding by a compensation judge that the employee=s work injury was not a substantial contributing cause of the employee=s total disability. However, with regard to the employer and insurer=s discontinuance of benefits, the court wrote as follows:
 The record discloses, however, that the insurer discontinued payment of benefits on December 10, 1980, but did not file a notice of discontinuance pursuant to Minn. Stat. ' 176.241 (1980) until January 5, 1981. That statute plainly required the employer-insurer to continue payment of compensation until the notice had been filed. The decision under review is therefore reversed in so far as it affirmed denial in full of employee=s claim, and we remand so that it be amended to award employee temporary total disability compensation from December 10, 1980, to January 5, 1981, but not thereafter.
Id. at 277, 36 W.C.D. at 50 (footnote omitted). We acknowledge that Ansari was based on the statutory predecessor to Minn. Stat. ' 176.238; however, both discontinuance statutes provide for payment of benefits until the NOID is filed. As such, the holding in Ansari is equally applicable here. See also Turek v. Northfield Freezings, slip op. (W.C.C.A. May 30, 2002) (an employer and insurer who neglect or fail to file an NOID, as required by Minn. Stat. ' 176.238, subds. 1 and 2, are liable for payment of benefits for the 50-day period beginning when the NOID should have been filed, or the date of the last benefit payment).
Pursuant to Minn. Stat. ' 176.238, subds. 1 and 2, and Ansari, the employer and insurer were liable for payment of temporary total disability benefits through May 24, 2000, the date of filing of the NOID. Because the retroactive discontinuance was, as a matter of law, improper, the Department was justified in assessing penalties, and the compensation judge=s decision to the contrary is reversed.
 This matter was apparently heard by the compensation judge by telephone, and the hearing was not recorded. The better practice in cases such as this is to record the hearing, for later transcription in the event of an appeal, or for the parties to submit the case to the judge on written stipulated facts. Had there been any controversy over the facts relevant to the legal issue here, rehearing would have been necessary.
 The Department assessed penalties under Minn. Stat. '' 176.221 and 176.225 and Minn. R. 5220.2760. The applicability of Minn. Stat. ' 176.221, subd. 3, is uncertain, because that provision, by its terms, applies if an employer and insurer fail Ato begin payment of compensation@ within the time limits prescribed by statute, whereas this case involves a purportedly improper discontinuance. However, the employer and insurer do not argue on appeal, either, that the penalty was calculated incorrectly or that the Department applied the wrong penalty provision. Just as importantly, Minn. R. 5220.2720, subps. 1E and 2, would appear to authorize a substantially larger penalty than that assessed in this case. Under these circumstances, we will not consider this issue further.
 A few clauses indicate that benefits shall cease Awhen@ a particular event occurs, such as an employee=s return to work or the insurer=s payment of 104 weeks of benefits. Minn. Stat. ' 176.101, subd. 1(e) and 1(k). We need not determine, at this time, whether these cessation conditions should be treated differently.