DARREN HALLS, Employee/Appellant, v. MINNESOTA SWARM LACROSSE/ARLO SPORTS and BERKLEY RISK ADM’RS CO., Employer-Insurer.

WORKERS’ COMPENSATION COURT OF APPEALS
APRIL 30, 2013

No. WC12-5478

HEADNOTES

JURISDICTION - SUBJECT MATTER.  The compensation judge lacked jurisdiction to grant a credit or offset to the employer and insurer for Minnesota workers’ compensation benefits they paid during the time that the employee was also receiving unemployment and/or sickness benefits from the Canadian government, and we reverse.

Reversed.

Determined by:  Hall, J., Wilson, J., and Stofferahn, J.
Compensation Judge:  James F. Cannon

Attorneys:  Raymond R. Peterson, McCoy, Peterson & Jorstad, Minneapolis, MN, for the Appellant.  Susan E. Larson and Christine L. Tuft, Arthur, Chapman, Kettering, Smetak & Pikala, Minneapolis, MN, for the Respondents.

 

OPINION

GARY M. HALL, Judge

The employee appeals from the compensation judge’s determination that “the wage loss benefits awarded to the employee during the time periods that he received Canadian unemployment and/or sickness benefits, shall be offset by the unemployment and/or sickness benefits actually received by the employee from the Canadian government during the same time of the wage loss benefits awarded.”  We reverse.

BACKGROUND

The employee, Darren Halls, is a native of Canada and a Canadian citizen.  On February 20, 2009, the employee sustained an admitted work-related right knee injury while employed as a professional lacrosse player for the employer, Minnesota Swarm Lacrosse/Arlo Sports.  The employee filed a claim petition on May 17, 2010, in which he sought payment of periodic temporary total disability and temporary partial disability benefits.

As a professional lacrosse player, the employee would typically travel from Canada to the United States to play lacrosse on weekends.  He would live and work in Canada from Sunday night through Thursday evening.  He would then travel to the United States to play professional lacrosse for the weekend.  While at home in Canada, the employee would work as an HVAC technician.  He has not been able to return to work in HVAC since his injury in February 2009.

After his injury, the employee underwent a right knee surgery in April 2009.  He also received permanent partial disability benefits in the amount of three percent as a result of his right knee injury.  After the April 2009 surgery, however, the employee continued to experience problems with his right knee.  The employee underwent a second right knee surgery in September 2011.  The employee testified that his right knee did improve significantly following the second surgery and continues to improve.  The employee testified that he eventually hopes to be able to return to work as a professional lacrosse player.  However, he has not been able to return to work as a lacrosse player since his 2009 injury.

Following his injury in February 2009, the employee began doing light roofing and construction work in Canada.  By the summer of 2010, the employee had worked enough hours to qualify for Canadian unemployment compensation, which he began collecting after a seasonal layoff in the fall of 2010.  The employee received unemployment benefits through the Canadian government from November 2010 through September 2011.  He was also receiving workers’ compensation benefits through the employer and its insurer, including wage loss benefits, during that time.

An intervention notice was sent to the Orangeville, Ontario, Canada Service Centre in February 2011.  According to the employee’s testimony, he had gone to that office to apply for unemployment benefits.  At the time of the hearing herein, the Canadian government had not intervened in this matter.

The employee testified that he spoke with a Mrs. Ross at the Orangeville Service Centre.  The employee knew Mrs. Ross’s daughter from high school.  The employee testified that he informed Mrs. Ross that he was pursing a claim for workers’ compensation benefits in Minnesota, and, as such, Canada would have a right to get its money back as a result of that claim.  The employee testified that Mrs. Ross told him that “the States work differently than Canada so they didn’t want to know anything about what was going on down here.”

The employee does not dispute that he received unemployment benefits through the Canadian government from November 2010 through September 2011.  He received approximately $15,450.00 in Canadian dollars.  The employee testified that between November 2010 and September 2011, he was primarily performing physical therapy, and he was not looking for work elsewhere while receiving unemployment benefits.  He did return to some roofing work the following summer, but he continued receiving unemployment because he only worked the minimum hours allowable before his Canadian unemployment benefits ceased.

By the time of the hearing, the employee had begun working as a heavy machine operator for a new employer, Universal Sand & Soil.  He testified that he is physically capable of performing that job.

The case came on for hearing before Compensation Judge James F. Cannon on Friday, April 27, 2012.  The following issues were presented to the compensation judge:

1.  Whether the employee is entitled to temporary total disability and temporary partial disability benefits for the respective periods claimed from May 14, 2010 to September 6, 2011, due to his admitted work-related injury of February 10, 2009.
2.  Whether any wage loss benefits awarded should be offset by unemployment and/or sickness benefits received by the employee from the Canadian government during the same time periods, even though the Canadian government has not intervened.

The compensation judge found that an offset should apply to the award of wage loss benefits in this matter, even though the Canadian government had not intervened.  The compensation judge cited the case of Pierce v. Robert D. Pierce, Ltd., 363 N.W.2d 761, 37 W.C.D. 514 (Minn. 1985), and he found persuasive the employer and insurer’s argument that allowing a credit would avoid unjust enrichment in the form of double recovery to the employee.  The compensation judge found that the employee’s testimony regarding his conversation with Mrs. Ross at the Canadian unemployment office suggested that “the provider pursuing recovery against the employee is an unlikely outcome” in this case.

STANDARD OF REVIEW

In reviewing cases on appeal, the Workers’ Compensation Court of Appeals must determine whether “the findings of fact and order [are] clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.”  Minn. Stat. § 176.421, subd. 1.  Substantial evidence supports the findings if, in the context of the entire record, “they are supported by evidence that a reasonable mind might accept as adequate.”  Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 59, 37 W.C.D. 235, 239 (Minn. 1984).  Where evidence conflicts or more than one inference may reasonably be drawn from the evidence, the findings are to be affirmed.  Id. at 60, 37 W.C.D. at 240.  Similarly, “[f]actfindings are clearly erroneous only if the reviewing court on the entire evidence is left with a definite and firm conviction that a mistake has been committed.”  Northern States Power Co. v. Lyon Foods Prods., Inc., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975).  Findings of fact should not be disturbed, even though the reviewing court might disagree with them, “unless they are clearly erroneous in the sense that they are manifestly contrary to the weight of the evidence or not reasonably supported by the evidence as a whole.”  Id.

“[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).

DECISION

This case provides rather unique circumstances involving unemployment benefits paid in Canada and workers’ compensation benefits paid in Minnesota.  The employee argues that even if he does receive what amounts to, essentially, a double recovery, “the compensation judge had no jurisdiction to examine the unemployment compensation law of Canada to determine the eligibility of employee to receive such compensation or the right of the Canadian government to receive reimbursement.”  The employee also asserts that the compensation judge improperly “leapt to the conclusion” that it was unlikely that the Canadian government would pursue reimbursement.

The compensation judge decided to accept the employer and insurer’s argument that “as a matter of public policy,” a credit in the amount of the Canadian unemployment benefits should be awarded to the employer and insurer so that the employee would not receive the “unjust enrichment of a double recovery.”  In reaching his decision, the compensation judge relied on Pierce v. Robert D. Pierce, Ltd., 363 N.W.2d 761, 37 W.C.D. 514 (Minn. 1985).

In Pierce, an employee sustained an injury to his leg while working in Alaska in 1975.  Id. at 762, 37 W.C.D. at 515.  After payment of workers’ compensation benefits in Alaska, the employee was retrained as a cosmetologist and relocated to Minnesota to become self-employed.  Id.  In 1980, the employee developed a disabling thrombophlebitis in his leg.  Id.  The employee then filed a claim petition in Alaska for benefits related to the thrombophlebitis, claiming that it was the result of the 1975 leg injury.  Id.  The Alaska employer denied primary liability, but another settlement was reached in Alaska in June 1981.  Id.

In January 1982, the employee filed a claim petition in Minnesota related to the same thrombophlebitis.  Id. at 762, 37 W.C.D. at 516.  The Minnesota employer sought a credit.  Id.  A compensation judge determined that the thrombophlebitis arose out of the employee’s self-employment.  Id.  The compensation judge denied the credit, however, concluding that there was no evidence to indicate which of the employee’s Alaska claims were being compensated in the settlement, and this court affirmed.  Id.  The Supreme Court subsequently reversed, however, noting that a credit is permitted where there are successive awards in different states for the same injury, “to avoid the injustice of double recovery.”  Id. at 763, 37 W.C.D. at 517.

Minnesota has long recognized that an award or settlement obtained in another jurisdiction does not bar a successive award in this state, even where the same condition or injury is the basis of both claims.  Pierce, 363 N.W.2d at 762-63, 37 W.C.D. at 517; (as cited in Rundberg v. Hirschbach Motor Lines, 51 W.C.D. 193, 206 (W.C.C.A. 1994), aff’d without opinion, 520 N.W.2d 747 (Minn. 1994)).  In such cases, workers’ compensation benefits previously received by the employee, whether through an award, settlement, or voluntary payment in the other jurisdiction, may be credited against the compensation the employee is awarded in this state to avoid any double recovery.  See Rundberg, 51 W.C.D. at 206 (citations omitted).

Cases such as Pierce are distinguishable from the present case.  In Pierce, the employee received settlement proceeds from the successive Alaska claim, which he filed after the thrombophlebitis developed.  As such, he received workers’ compensation benefits from both Alaska and Minnesota arising out of the same injury/condition.  In this case, however, the employee has received unemployment benefits from the Canadian government.  The employee has not received a double recovery of workers’ compensation benefits from multiple jurisdictions relating to the same injury, which is the public policy consideration in Pierce.

Furthermore, Minn. Stat. § 175A.01 governs the jurisdiction of compensation judges and of this court.  Minn. Stat. § 175A.01, subd. 5; Hale v. Viking Trucking Co., 654 N.W.2d 119, 123, 62 W.C.D. 701, 704 (Minn. 2002).  Pursuant to § 175A.01, subd. 5, that jurisdiction is limited to “questions of law and fact arising under the workers’ compensation laws of [Minnesota].”  Hale, 654 N.W.2d at 123, 62 W.C.D. at 704 (citing Minn. Stat. § 175A.01, subd. 5).  Thus, any claim not involving Minnesota workers’ compensation laws must be dismissed for lack of subject matter jurisdiction.  Id.  Compensation judges and this court have

jurisdiction to determine “all questions of law or fact arising under the workers’ compensation laws of the state.”  It is a jurisdiction expressly limited to this, and no more: “The workers’ compensation court of appeals shall have no jurisdiction in any case that does not arise under the workers’ compensation laws of the state.”

Rundberg, 51 W.C.D. at 206 (quoting Minn. Stat. § 175A.01, subd. 5).  Therefore, Minnesota workers’ compensation courts lack jurisdiction to consider questions of law arising under the workers’ compensation statutes of other states.  Martin v. Morrison Trucking, Inc., 803 N.W.2d 365, 369, 71 W.C.D. 361, 367-68 (Minn. 2011) (citing Hale, 654 N.W.2d 119, 62 W.C.D. 701 and Rundberg, 51 W.C.D. at 205-06).  In addition, Minnesota workers’ compensation courts generally do not have jurisdiction to examine statutes other than the Minnesota Workers’ Compensation Act.  See Martin, 803 N.W.2d at 369-70, 71 W.C.D. at 368 (citing Freeman v. Armour Food Co., 380 N.W.2d 816, 38 W.C.D. 445 (Minn. 1986)).

Here, the compensation judge’s determination involved, at least, an implicit consideration of the Canadian unemployment benefits the employee received and the likelihood that the Canadian government would pursue recovery from the employee.  This determination extended beyond the compensation judge’s jurisdiction.

In addition, unemployment benefits do not fall within the same type of benefits workers’ compensation benefits considered by cases such as PierceSee also Stolpa v. Swanson Heavy Moving Co., 315 N.W.2d 615, 34 W.C.D. 423 (Minn. 1982) (holding that a Wisconsin employee who had been injured in Minnesota and had received workers’ compensation benefits that were voluntarily paid by his Wisconsin employer could also seek workers’ compensation benefits in Minnesota related to the same injury, from which the Wisconsin benefits paid to him could be deducted).  Cases such as Pierce state that pursuant to Minnesota law, any Minnesota workers’ compensation benefits awarded are subject to being reduced by the amount of workers’ compensation benefits already paid by another jurisdiction in relation to the same injury or condition, which would entitle an employee to collect the difference in workers’ compensation benefits paid between the two jurisdictions.

Although public policy disfavors unjust double recovery in cases such as Pierce, which involve double recovery of workers’ compensation benefits, public policy also dictates that a windfall to the employer and insurer should be avoided.  See Springer v. Ladlie Trucking, slip op. (W.C.C.A. Aug. 22, 1991) (discussing Pierce).  We recognize that the employee has received both workers’ compensation benefits in Minnesota and unemployment benefits in Canada.  However, the employer and insurer have paid the workers’ compensation benefits due to the employee as the result of his work injury herein, and the employee has received no other workers’ compensation benefits from any other jurisdiction.  As such, the compensation judge awarded an equitable remedy that was beyond his jurisdiction, and we reverse.