Opinion
W.C. No. 4-351-216
September 30, 1998
FINAL ORDER
The respondents seek review of a final order of Administrative Law Judge Stuber (ALJ), which awarded the claimant medical benefits for a surgery recommended by the treating physician. The respondents contend the ALJ erred in excluding evidence that the claimant falsely represented his health status on the application for employment. The respondents also contend the ALJ erred in crediting the claimant's testimony that he hurt himself on the job. We affirm.
The respondent-employer (Brown) hired the claimant as a construction laborer on July 23, 1997. On the employment application, the claimant answered "no" to the following question: "Are you bothered with or have you ever had: Back Problems?" In fact, the claimant had sustained a back injury which necessitated surgery at L5-S1 in November 1988. The claimant filed a claim seeking benefits for a back injury which he allegedly sustained on August 25, 1997, while employed by Brown.
At the commencement of the hearing, the respondents offered to prove that the claimant's false statement concerning his prior back problems was "material" to Brown's decision to hire the claimant. Consequently, the respondents contended that the claimant could not be considered Brown's "employee" under the Court of Appeals decision in Artcraft Sign Co. v. McGrath, 679 P.2d 1103 (Colo.App. 1983). However, the ALJ ruled as a matter of law that the proffered evidence was irrelevant because false statements on the employment application would not constitute a defense to the claim for benefits.
The ALJ also credited the claimant's testimony that following the incident on August 25, 1997, he experienced a sharp increase in low back symptoms. The ALJ stated that the "most probable scenario is the claimant had a preexisting L5-S1 defect which caused him intermittent symptoms for several years, but the August 25, 1997 accident caused a significant aggravation of that problem." The ALJ noted that this theory was consistent with the medical evidence including the testimony of Dr. Odom. Consequently, the ALJ ordered the respondents to pay for the surgery recommended by Dr. Odom.
I.
On review, the respondents contend that the ALJ erred in refusing to admit evidence that the claimant made a false statement on the employment application, that the false statement influenced Brown's decision to hire him, and that the false statement played a causal role in the August 25 injury. Relying on Artcraft Sign Co. v. McGrath, supra, the respondents reason that the claimant cannot be considered Brown's "employee." We reject this argument.
The respondents recognize that in Kraus v. Artcraft Sign Co., 710 P.2d 480 (Colo. 1985), the Supreme Court reversed the Court of Appeals decision in Artcraft Sign Co. v. McGrath. However, the respondents assert that Kraus is not dispositive because the facts are distinguishable from those present here, and because Kraus involved the attempted withdrawal of an admission of liability. We agree with the ALJ that Kraus is dispositive of the respondents' arguments.
In Artcraft Sign Co. v. McGrath, supra, the facts indicate that the claimant wrote "none" when asked to list his "physical defects" on the employment application. The claimant also failed to answer a question concerning whether or not he had a prior injury. Under those circumstances, the Court of Appeals held that the matter should be remanded to the ALJ for a factual determination concerning whether or not the claimant knowingly and willfully made a false representation concerning his physical condition, and whether there was a causal connection between the false representation and the injury. (The ALJ had already found that the employer relied on the claimant's statements in the employment application.) If such facts were established, the Court of Appeals held that the insurer would be entitled to withdraw its admission of liability for workers' compensation benefits.
However, in Kraus v. Artcraft Sign Co., supra, the Supreme Court reversed the decision of the Court of Appeals. The Supreme Court recognized that an admission of liability is subject to withdrawal where the claimant makes "fraudulent statements regarding the specific injury for which benefits are claimed." 710 P.2d at 481. However, the court noted that the claimant's alleged misstatements occurred in the employment application, and did not concern the injury for which benefits were claimed. Moreover, the court stated that it was not empowered to "read nonexistent provisions into the Colorado Workmen's Compensation Act."
We have subsequently considered whether the Supreme Court's decision in Kraus v. Artcraft Sign Co., supra, extends to cases where no admission of liability has been filed and the respondents seek to impose an absolute defense based on a claimant's false representations in an employment application. We have consistently held that, because the Act does not contain any provision creating a defense based on a claimant's misrepresentations in the employment application, the General Assembly did not intend for any such defense to exist. E.g. Lujan v. National Service Co. of Iowa, W.C. No. 4-281-483 (July 14, 1997); Kennedy v. Albertson's, Inc., W.C. No. 3-922-698, 3-935-218 (March 5, 1991), aff'd., Albertson's, Inc. v. Industrial Claim Appeals Office, (Colo.App. 91CA0464, January 23, 1992) (not selected for publication). We see no reason to depart from these prior decisions and decline to do so now.
The respondents' attempt to distinguish Kraus on factual grounds is without merit. As noted, the statement of facts contained in Artcraft Sign Co. v. McGrath, supra, indicates the respondents were alleging an affirmative misrepresentation on the employment application because the claimant indicated "none" when asked to list his physical defects. In any event, we discern no meaningful distinction between affirmative misrepresentations and a deliberate failure to disclose pertinent facts. Whatever the particular form of the alleged fraud, the Act does not create any defense based upon misrepresentations in an employment application.
The respondents cite several civil cases suggesting that an employee's false representation on an employment application constitutes a defense to certain claims based on breach of the employment contract. However, we do not consider these cases to be pertinent in the context of workers' compensation. To the contrary, workers' compensation is entirely statutory, and the "jurisdiction, powers, duties and authority" of tribunals adjudicating workers' compensation claims are limited to those created by statute. Lewis v. Scientific Supply Co., Inc., 897 P.2d 905 (Colo.App. 1995). Thus, if the Act itself does not create a defense based on false statements in an employment application, we have no power to create one.
We also note that § 8-40-202(1)(b), C.R.S. 1998, defines an "employee" as a "person in the service of any person, association of persons, firm, or private corporation... under any contract of hire, expressed or implied." Section 8-40-301(1), C.R.S. 1998, contains numerous categories of persons excluded from the definition of "employee." Neither of these statutes excludes from the definition of an "employee" a person who makes a false statement on an employment application.
It follows that the ALJ correctly ruled that the evidence concerning the allegedly false representations on the employment application was not relevant for purposes of establishing a defense to the claim for benefits. In view of this ruling, we need not consider the claimant's other arguments in support of the ALJ's ruling.
II.
The respondents next contend the ALJ failed to make adequate findings of fact concerning the claimant's credibility. Specifically, the respondents assert that the claimant contradicted himself concerning the type of work he performed at Slaughter Construction. We find no error.
The question of whether a claimant's need for treatment is causally connected to the alleged industrial injury is one of fact for determination by the ALJ. City of Durango v. Dunagan, 939 P.2d 496 (Colo.App. 1997). Consequently, we must uphold the ALJ's order if supported by substantial evidence in the record. See § 8-43-301(8), C.R.S. 1998. In applying this standard, we must defer to the ALJ's resolution of conflicts in the evidence, his credibility determinations, and the plausible inferences he drew from the evidence. Metro Moving Storage Co. v. Gussert, 914 P.2d 411 (Colo.App. 1995). Further, the ALJ is not required to make findings of fact concerning every piece of evidence. It is sufficient if the ALJ makes findings concerning that evidence which he finds determinative of the issues involved. Riddle v. Ampex Corp., 839 P.2d 489 (Colo.App. 1992).
Here, the ALJ found that the claimant's testimony concerning the mechanism of his injury is supported by the medical records as well as the testimony of Dr. Odom. The ALJ explicitly noted that the claimant's testimony was impeached, but the ALJ stated he was not persuaded by the impeachment. In fact, the ALJ found that the claimant's failure to disclose the prior injury on the employment application demonstrated the claimant's desire to work. Under these circumstances, the ALJ did not err in choosing to credit the claimant's testimony, and we decline the respondents' invitation to substitute our judgment for that of the ALJ concerning the claimant's credibility. Further, the findings are sufficient to indicate the basis of the ALJ's order.
III.
Citing § 8-43-301(14), C.R.S. 1998, claimant requests that we award attorney fees. The claimant reasons that the Supreme Court disposed of the respondents' arguments in Kraus v. Artcraft Sign Co., supra, and therefore, the appeal is not well grounded in fact or warranted by "existing law or a good faith argument for the extension, modification, or reversal of existing law." We disagree.
Although we rejected the respondents' attempts to distinguish Kraus v. Artcraft Sign Co., supra, we do not find their argument to be frivolous. So far as we know, no published appellate decision has determined whether Kraus applies in a case, such as this, where the issue does not involve withdrawal of an admission of liability. Thus, the respondents made a rational attempt to distinguish Kraus, and there is no basis for an award of attorney fees. See Tozer v. Scott Wetzel Services, Inc., 883 P.2d 496 (Colo.App. 1994).
IT IS THEREFORE ORDERED that the ALJ's order dated February 11, 1998, is affirmed.
IT IS FURTHER ORDERED that the claimant's request for attorney's fees is denied.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________ David Cain
______________________________ Bill Whitacre
NOTICE
This Order is final unless an action to modify or vacate the Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, Colorado 80203, by filing a petition to review with the court, with service of a copy of the petition upon the Industrial Claim Appeals Office and all other parties, within twenty (20) days after the date the Order was mailed, pursuant to §§ 8-43-301(10) and 307, C.R.S. 1998.
Copies of this decision were mailed September 30, 1998 to the following parties:
Benjamin J. Slaughter, 1053 Memphis St., Aurora, CO 80011
W. M. Brown Construction Co., 3489 W. 72nd Ave., Westminster, CO 80030
Kay Carnahan, California Indemnity Co., P.O. Box 6597, Englewood, CO 80155-6597
Daniel B. Galloway, Esq., 1777 S. Harrison St., #906, Denver, CO 80210 (For the Claimant)
Kent L. Yarbrough, Esq., 5353 W. Dartmouth Ave., #400, Denver, CO 80227 (For the Respondents)
BY: _______________________