HIEU NGUYEN, Employee, v. COMPASS GROUP USA, and ZURICH INS., Employer-Insurer/Petitioners.

WORKERS= COMPENSATION COURT OF APPEALS

FEBRUARY 12, 2004

HEADNOTES

VACATION OF AWARD - FRAUD.  The findings by the compensation judge support a conclusion that good cause exists to vacate the compensation judge=s Findings and Order under Minn. Stat. ' 176.461.

Petition to vacate granted.

Determined by Stofferahn, J., Wilson, J., Johnson, C.J.

Attorneys: Debra J. Heisick, Drawe & Heisick, Minneapolis, MN, for the Petitioners.  Denise Lemmon, Maguire & Lemmon, Eagan, MN, for the Respondent.

OPINION

DAVID A. STOFFERAHN, Judge

The employer and insurer appeal from the compensation judge=s decision awarding benefits to the employee.  The employer and insurer have also petitioned to vacate the compensation judge=s decision.  We grant the petition to vacate and dismiss the appeal.

BACKGROUND

The employee claimed to have sustained a work injury on May 21, 2001 while in the employ of Compass Group USA.  At the time of his injury, the employee was also working a second job as a cleaner for H&H Aircraft.  The employee alleged that as a result of his work injury he was entitled to payment of medical expenses and temporary total disability compensation beginning May 21, 2001.  The employer and insurer initially paid benefits but then filed a Notice of Intention to Discontinue Compensation on January 7, 2002 alleging that the employee had not suffered a physical injury in the motor vehicle accident. 

The dispute was heard before Compensation Judge John Ellefson on January 25, 2002.  In his Findings and Order, served and filed February 7, 2002, the compensation judge refused to allow the discontinuance and ordered the employer and insurer to pay continuing temporary total disability compensation benefits.  The employer and insurer appealed to this court.

During the pendency of the appeal, the employer and insurer filed a petition to vacate the compensation judge=s Findings and Order.  The employer and insurer alleged that the decision of the compensation judge was procured by fraud and specifically, that, contrary to his assertions in his deposition and at hearing, the employee had continued to work at his job at H&H Aircraft.  The employee filed a response which denied the allegations.  In our decision of November 15, 2002, we stayed the appeal of the employer and insurer and remanded this matter for an evidentiary hearing pursuant to Minn. Stat. ' 176.381. 

The hearing was held at the Office of Administrative Hearings on August 19 and September 18, 2003 by Compensation Judge Ron Erickson.  In his Findings and Order of September 29, 2003, the compensation judge determined that the employee had continued to be employed at H&H Aircraft between May 21, 2001 and January 25, 2002.  The compensation judge also found that, while the employer and insurer had exercised due diligence in investigating the employee=s claim, they did not discover the employee=s work at H&H Aircraft.  Finally the compensation judge concluded that the employee made false representations of his physical condition and his employment status which were the proximate cause of the payment by the employer and insurer of temporary total disability compensation benefits.  This matter now returns for consideration of the petition to vacate.  There was no appeal of the September 29, 2003 Findings and Order.

DECISION

The Workers= Compensation Court of Appeals is given authority to vacate the decision of a compensation judge by Minn. Stat. ' 176.461 which allows vacation for good cause, including fraud.  In order to establish fraud there must be:

1.  a false representation of facts;

2.  the representation must deal with past or present fact;

3.  the fact must be susceptible of knowledge;

4.  the representing person must know the fact is false;

5.  the representing party must intend that another be induced to act upon the false representation;

6.  the other person must in fact act on the false representation;

7.  the misrepresentation must be the proximate cause of actual damages.