Respondents can withdraw an admission of liability if it is based on materially false information.

The Court of Appeals recently announced a decision upholding the ALJ’s denial and dismissal of a claimant’s claim for benefits and voiding the respondents’ admission of liability ab initio.

On November 28, 2014, claimant worked as a cook for Qdoba Mexican Grill when he was assaulted by three or four people while allegedly taking out the trash.  He sustained multiple injuries and had been unable to work since the assault. Based on the facts that the assault occurred during claimant’s working hours and he repeatedly indicated he did not know his assailants, respondents admitted liability in April 2017 and agreed to pay permanent partial disability benefits based on his 42% whole person impairment rating. Respondents later obtained information that suggested claimant knew his assailants and his assault was the result of a drug deal gone wrong after he had stolen drugs from the assailants. The fact that he knew his assailants was important because personal assaults, although committed at the work place, are usually not deemed compensable. In July 2017, claimant sought permanent total disability benefits and respondents endorsed several issues for hearing including apportionment and offsets. By October 2017, respondents moved to add “withdrawal of admissions” to its defenses. This defense was also reiterated on the respondents’ case information sheet.

In the first of three hearings taking place in December 2017, respondents again asserted that they would be withdrawing their admission of liability. At hearing, claimant’s story had several inconsistencies and respondents presented evidence that this was a personal assault because claimant knew his assailants. The ALJ did not find claimant credible and agreed with respondents that this was a personal non-compensable assault. The ALJ ruled that respondents could withdraw their admission. The ALJ determined that respondents’ April 2017 admission was based on “materially false” representations that claimant was performing a work duty when he was assaulted by unknown assailants trying to rob him. The ALJ then ruled that the admission was void ab initio and denied claimant’s claim.

Claimant unsuccessfully appealed to the Industrial Claims Appeals Office (“the Panel”). Claimant argued he was not given sufficient notice that respondents sought to withdraw its admission, the ALJ failed to address each element of fraud in her ruling, and she incorrectly relied on a case that held respondents could withdraw an admission if based on materially false information. The Panel found no merit to claimant’s arguments, and instead held that claimant had sufficient notice of the defenses asserted, the case law relied on was appropriate, and the ALJ’s findings were sufficient as the court was able to discern from the order the reasoning which underlies it.

The claimant presented no evidence that would show the record was not supported by substantial evidence or that the ALJ abused her discretion.

In a subsequent appeal, the Court of Appeals upheld the ALJ’s Order finding that the record was supported by substantial evidence and agreed the withdrawal of admission was proper in this case.

Martin v. Industrial Claim Appeals Office, W.C. No. 4-968-114 (Colo. App. 2020)

Would you like to know more? Contact Brad Miller at bmiller@pollartmiller.com or 877-259-5693.

From the April 2020 Newsletter

2020-04-28T13:32:17-06:00