Gleneagles, Inc. v. Hanks

SHARER, J. In this appeal we are presented with the question of whether, in a workers’ compensation case, an employer and insurer can resort to injunctive relief, under the circuit court’s plenary equity power, to circumvent the “no stay” provision of Maryland Code Annotated (1999 RepLVol.), Labor and Employment Article § 9-741, and thereby delay payment of an award of compensation pending judicial review. The genesis of this case is a claim filed by appellee, Linda M. Hanks, with the Workers’ Compensation Commission (“the Commission”), seeking benefits for an occupational disease contracted in 1990 while employed by appellant, Gleneagles, ⁵⁴⁶ Inc. 1 After several proceedings, and substantial delays, an award of compensation was ordered by the Commission on May 9, 2003, awarding Hanks $282 per week (for 333 weeks) from appellant Gleneagles, and $144 per week (for 240 weeks) from the Subsequent Injury Fund (“the Fund”). Because none of the award had yet been paid, and because the award accounted from April 28, 1992, Gleneagles and the Fund were faced with obligations to Ms. Hanks, respectively, of $93,906 and $34,560. Appellants filed a petition for judicial review of the Commission’s decision, asserting primarily the issue of the statute of limitations.

They contemporaneously filed, in the Circuit Court for Harford County, a request for an immediate temporary restraining order and a request for stay and/or preliminary injunction, seeking to defer payment of the award until judicial review had been concluded. Of greater significance to appellants is the inability to recoup the funds should they ultimately prevail on the limitations issue. The circuit court, after an in-chambers, off-the-record, conference with counsel for all parties, granted a temporary restraining order on May 27, 2003. The effect of that order was to relieve Gleneagles’ insurer and the Fund of the obligation to make immediate payment of the award.

On September 19, 2003, following a merits hearing, the court entered an order striking its earlier order and directing payment of the award. 2 This timely appeal followed. Appellants present one question for review, which, reworded is: 3 ⁵⁴⁷ May the circuit court enjoin immediate payment of a Workers’ Compensation Award, thereby avoiding the “no stay” language of Md.Code Ann. § 9-741? We answer this question in the negative, and shall affirm the circuit court. FACTUAL and PROCEDURAL HISTORY Although not directly relevant to determination of the legal issue presented by this appeal, we will, to provide context, review the factual and procedural posture of the litigation.

Proceedings Before the Commission Ms. Hanks tiled a claim for benefits on February 12, 1991, for an occupational disease contracted on the job involving her left and right hands and/or arms. The claimed date of disablement was March 1, 1990. The claim was deemed compen-sable by the Commission on April 22, 1991, and Gleneagles paid benefits for temporary total disability, temporary partial disability, and/or vocational rehabilitation services for various periods from April 26, 1990, through April 27, 1992. The last payment of compensation was issued on April 20, 1992, for the period from April 14,1992 through April 27,1992.

Claiming worsening of her condition, Ms. Hanks filed issues on several later occasions, including a claim on December 8, 1995, for permanent partial disability to the left and right upper extremities, arms, shoulders, and hands. The Commission scheduled a hearing for April 30, 1996, which was continued, at Ms. Hanks’ request. On June 7, 1996, Ms. Hanks’ attorney requested that the matter be reset for hearing on September 10, 1996. A hearing was scheduled, but was again continued at Ms. Hanks’ request.

On September 11, 1996, she again requested that the matter be set for hearing, this time between November 6th and 15th, 1996. ⁵⁴⁸ The last request for hearing was followed by new issues requesting authorization for certain medical treatment and payment of medical expenses. At that time, she also asserted an issue of causal connection of her shoulder condition. No request for additional compensation, either temporary or permanent, was then made. In response to the newly filed issues, the Commission scheduled a hearing for November 19, 1996.

The hearing was continued, again at the request of Ms. Hanks. Hearings were rescheduled for December 18, 1996, January 13,1997, and February 11, 1997. All of those hearing were continued—two at the request of Ms. Hanks and one on motion of the Commission. Finally, a hearing was held on June 5, 1997, concerning issues of medical treatment, medical expenses, and causal relationship as to her shoulders.

The hearing also addressed two issues raised by Gleneagles: (1) whether Ms. Hanks should be required to file a new claim for the condition involving her shoulders; and (2) limitations as to the claim relating to her bilateral shoulder condition. The Commission issued an Order on August 7, 1997, which was amended on September 2, 1997, granting Ms. Hanks’ requests for medical treatment and payment of medical expenses, and finding causal relationship of the shoulders. That order denied Gleneagles’ issues. Subsequently, on February 2, 1998, Ms. Hanks filed issues relating to causal relationship of a neck condition, and a hearing was scheduled for October 27,1998.

The hearing was continued on Ms. Hanks’ motion made on the day of the hearing. Her claim remained dormant until September 7, 1999, when Ms. Hanks forwarded a letter to the Commission requesting a hearing on issues of permanent partial disability. Gleneagles contested Ms. Hanks’ entitlement to those benefits by filing an issue of limitations on September 28, 1999. A hearing was scheduled for April 10, 2000, but was continued at the request ⁵⁴⁹ of Ms. Hanks in order to implead the Subsequent Injury Fund due to the possibility of pre-existing impairments. 4 Ms. Hanks promptly filed issues impleading the Fund.

The Fund filed its issues on July 28, 2000. On November 2, 2001, Ms. Hanks filed additional issues, raising permanent total disability. The case was next set for hearing on July 9, 2002, but was again continued and lay inactive until finally heard by the Commission on May 7, 2003. At that hearing, the Commission promptly addressed all of the issues raised by the parties, and entered an award of compensation on May 9, 2003.

The Commission ordered that the claim was not barred by limitations pursuant to Labor and Employment § 9—736(b)(3); and that: Ms. Hanks had sustained a permanent partial disability [ujnder “Other Cases” amounting to 60% industrial loss of use of the body, of which 50% is reasonably attributable to the occupational disease of 3/1/90 (both hands, both arms and both shoulders) and 10% of the right wrist due to Thomas which is not compensable and has pre-existing binaural hearing loss (right ear—100%; left ear—92%). In accordance with Section 9-630, claimant has a serious disability. As a result of the award of compensation, appellants were ordered to pay the sums that we have noted, supra. From the order of the Commission, appellants filed a timely petition for judicial review in the circuit court. ⁵⁵⁰ Proceedings Before the Circuit Court Contemporaneously with their petition for judicial review, appellants filed a request for an immediate temporary restraining order and a request for stay and/or preliminary injunction.

After an off-the-record conference with counsel for all parties on May 22, 2003, the circuit court granted the temporary injunctive relief sought by appellants in an order dated May 27, 2003. A full evidentiary hearing was set for July 28, 2003. After holding the matter sub curia, the court issued a thorough memorandum opinion and order dissolving the temporary injunction on the grounds that the circuit court was without jurisdiction to grant a stay of an award of compensation, pursuant to Md.Code Ann. Lab. & Empl. § 9-741, and Maryland Rule 7-205. The findings of the circuit court will be detailed further, infra, as necessary.

STANDARD of REVIEW We start with the well-established rule that a decision of the Commission is prima facie correct and the burden of proving otherwise on judicial review is upon the party attacking the decision. Blake Construction Co. v. Wells, 245 Md. 282, 286 , 225 A.2d 857 (1967). That rule, taken together with the mandate that the workers’ compensation law, as remedial legislation, is to be liberally construed in favor of the injured worker, forms the foundation for the prohibition of a stay of payment of benefits pending judicial review of the Commission’s order. Ordinarily, a decision of a circuit court regarding the grant or denial of injunctive relief will not be disturbed on appeal absent an abuse of discretion.

Antwerpen Dodge, Ltd. v. Herb Gordon Auto World, Inc., 117 Md.App. 290, 305 , 699 A.2d 1209 (1997), (citing Maryland Comm’n on Human Rel. v. Downey Communications, Inc., 110 Md.App. 493 , 678 A.2d 55 (1996)). If, however, the decision is based on a ruling of law the trial court must “exercise its discretion in accordance with correct legal standards.” Antwerpen Dodge, supra, 117 Md.App. at 305 , 699 A.2d 1209 (quoting Alston v. Alston, 331 ⁵⁵¹ Md. 496, 504, 629 A.2d 70 (1993)). There being no dispute of fact, we shall review the issue presented on the basis of legal error. DISCUSSION May the circuit court enjoin immediate payment of a Workers’ Compensation Award, thereby avoiding the “no stay” language ofMd.Code Ann. § 9-741?

Appellants argue that the circuit court erred in dissolving its prior grant of injunctive relief by finding that it had no authority or jurisdiction to enjoin the operation of an award of the Commission, and failed to apply the correct legal standard in making its decision. They argue that Md. Rule 7-205 permits a stay of an order or action of an administrative agency, 5 and that application of the court’s plenary equity power to issue injunctions is an appropriate vehicle by which to achieve a stay. Gleneagles also argues that its position is supported by the Commission’s own rule, codified as COMAR 14.09.01.24A(4), which directs that attorneys’ fees ordered by the Commission be placed in escrow until the 30-day appeal period has passed or, in the event of an appeal, until the appeal has been adjudicated. That provision Gleneagles argues, is precedent for the proposition that payment of an award can, in fact, be stayed.

Ms. Hanks, on the other hand, argues that the “no stay” provision of Md.Code Ann., Lab. & Empl. § 9-741 is absolute. Section 9-741 provides that an appeal of the Commission’s decision is not a stay of an order of the Commission requiring payment of compensation. She further asserts that Md. Rule 7-205 is inapplicable because a stay of an order of the Commission is “prohibited by law”—to wit, Lab. & Empl. ⁵⁵² § 9-741. Appellee concludes that, should Gleneagles be able to enjoin payment of the award, appellants will have successfully circumvented the statutory provision directing otherwise.

We believe appellee’s position to be the correct one. Md.Code Ann., Lab. & Empl. § 9-741, provides: Appeal not a stay An appeal [of the Commission’s order] is not a stay of: (1) an order of the Commission requiring payment of compensation; or (2) an order or supplemental order of the Commission requiring the provision of medical treatment. The purpose of the “no stay” provision in § 9-741 has been addressed by the Court of Appeals: Over four decades ago our predecessors proclaimed the validity of the “no stay” clause in § 56(a) [currently codified in Md.Code Ann., Lab. & Empl. § 9-741]. Judge Urner,