You can
search the entire site.
or go to the recent opinions, or the chronological or subject indices.
Binder v. Fairbanks Historical Preservation and AK Nat'l Insurance (8/26/94), 880 P 2d 117
<![CDATA[
Notice: This opinion is subject to formal correction
before publication in the Pacific Reporter. Readers
are requested to bring errors to the attention of the
Clerk of the Appellate Courts, 303 K Street, Anchorage,
Alaska 99501.
THE SUPREME COURT OF THE STATE OF ALASKA
JOHN BINDER, )
) Supreme Court No. S-5501
Appellant, )
) Superior Court No.
v. ) 3AN-92-1229 Civil
)
FAIRBANKS HISTORICAL ) O P I N I O N
PRESERVATION FOUNDATION )
and ALASKA NATIONAL )
INSURANCE COMPANY, )
) [No. 4117 - August 26, 1994]
Appellees. )
______________________________)
Appeal from the Superior Court of the
State of Alaska, Third Judicial District,
Anchorage,
Donald D. Hopwood,
Judge.
Appearances: Michael A. Stepovich,
Fairbanks, for Appellant. Theresa Hennemann
and Elizabeth D. Goudreau, Faulkner,
Banfield, Doogan & Holmes, Anchorage for
Appellees.
Before: Moore, Chief Justice,
Rabinowitz, Matthews and Compton, Justices,
and Bryner, Justice, pro tem.*
MOORE, Chief Justice.
This workers' compensation case concerns the extent of
an employer's liability for reemployment benefits pursuant to AS
23.30.041. John Binder (Binder) seeks a ruling permitting the
Alaska Workers' Compensation Board (Board) to require that his
employer pay for a second reemployment plan after Binder's first
plan failed to meet the expectations of all involved parties.
Binder asserts that, although he completed all of the training
contemplated by his first plan, the plan did not adequately
prepare him to compete in his chosen field.
The Board awarded Binder a second reemployment plan.
Binder's employer, the Fairbanks Historical Preservation
Foundation, and its insurance carrier, Alaska National Insurance
Company (collectively referenced as FHPF), contend that AS
23.30.041(k) and (l) set forth the maximum amount of time and
money available for any number of reemployment plans which Binder
pursues. Because the aggregate cost of Binder's first and second
plans will exceed the $10,000 limitation of AS 23.30.041(l), and
their total time will exceed the two year time limit of
AS 23.30.041(k), FHPF asserts that the Board erred as a matter of
law in approving Binder's proposed new plan.
The superior court agreed with FHPF, ruling that the
statutory time and cost constraints set forth in AS 23.30.041(k)
and (l) limit the Board's authority to extend Binder's
reemployment benefits. We affirm.
I. Facts and Proceedings
Most of the operative facts in this case are
uncontested. In 1988 Binder worked for the Fairbanks Historical
Preservation Foundation on the restoration project of the
riverboat "Nenana." In August 1988 Binder lost four fingers on
his left hand while performing carpentry work.
FHPF accepted Binder's worker's compensation claim. In
the fall of 1988, Binder was determined to be eligible for
reemployment benefits pursuant to AS 23.30.041. Binder and the
rehabilitation counselor of his choice agreed upon a written
reemployment plan that would provide Binder with on-the-job
training in the field of videotape editing. FHPF agreed to this
plan, which went into effect around January 13, 1989.
The goal of the written plan was to provide sixteen
weeks of training between January and May 1989, after which
Binder would be able to control video consoles and television
monitors and "edit[] video tapes, graphics and computerized
effects in order to create a variety of productions such as
television commercials, special broadcast segments and corporate
training films." To acquire these skills, Binder received two
weeks of technical training in the area of basic video editing
from Alaska Video Productions of Fairbanks. Binder then traveled
to California for two weeks of intensive training with CMX
Corporation, and he returned to Fairbanks for an additional
twelve weeks of on-the-job training with Alaska Video
Productions. Binder completed his training around May 5, 1989.
FHPF expended $6,058.12 to implement Binder's reemployment plan.
Shortly after his completion of the plan, Alaska Video
Productions terminated Binder because he lacked the technical
skills necessary for the job. Binder then requested that his
training period be extended so that he could obtain the necessary
skills for videotape editing. In the alternative, Binder
requested a new reemployment plan that would return him to
remunerative employability as set forth in AS 23.30.041(i) and
(p)(7).
The Rehabilitation Benefits Administrator designee
(RBA) determined that Binder's reemployment plan had failed
because it had not provided him with the skills necessary to
compete in the video editing labor market. The RBA concluded
that the plan could not be successfully modified to provide
Binder with adequate skills in video editing within the two year
time span mandated by AS 23.30.041(k), and that Binder therefore
was entitled to a new reemployment plan.
Pursuant to the RBA's decision, Binder and a new
rehabilitation specialist developed a second reemployment plan.
The proposed second plan was designed to train Binder in the
field of nondestructive testing. The plan required eighteen
months of out-of-state schooling in nondestructive testing and
was projected to cost approximately $9,913.
FHPF appealed the RBA's decision awarding Binder a
second plan. FHPF agreed that the first plan had failed to meet
the expectations of the parties in that it did not provide Binder
with all of the skills he had hoped to acquire. However, FHPF
claimed that it should not be held responsible for Binder's
disappointment in the outcome of his plan, particularly when
Binder had developed and pursued the plan with knowledge of the
limited broadcasting market in Fairbanks. More significantly,
Binder had not expressed dissatisfaction with his plan until its
completion. Accordingly, FHPF argued to the Board that (1) AS
23.30.041 provides for only one reemployment plan; (2) even if
additional plans are authorized, FHPF could only be liable for a
maximum of two years of reemployment benefits and a total $10,000
in cost for any number of plans; and (3) Binder was already
"remuneratively employable"as defined in AS 23.30.041(p)(7)
because he had returned to work for greater than 60% of his gross
wages at the time of injury.1 The Board reviewed
the RBA's decision for an abuse of discretion. It found that
"[i]f the video plan was fatally flawed from its inception, it
was not a valid 'plan' under the statute and the employee is
still entitled to one (and only one) valid plan." The Board
concluded that the RBA had not abused her discretion in finding
the first plan invalid because it could not provide Binder with
adequate skills within the time constraints provided by AS
23.30.041(k). The Board therefore upheld the RBA's order
requiring FHPF to pay for a second reemployment plan which could
cost up to $10,000 and could take up to two years.
The superior court reversed the Board's decision. The
court determined that the issue to be resolved was one of
statutory interpretation, which is not entitled to deferential
review. It then found that Binder's first reemployment plan was
valid at the time it was prepared; there was no evidence to
suggest that the procedures set forth in AS 23.30.041(h) were not
followed in developing the plan, or that the plan was premised on
an unreasonable expectation that Binder would acquire sufficient
skills to be remuneratively employable in the video editing field
after a sixteen week training period. Upon concluding that the
plan comported with the procedural aspects of the statute, the
court determined that the Board's award of a second
rehabilitation plan violated the express terms of AS 23.30.041(k)
and (l) because it exposed FHPF to aggregate reemployment
training costs greater than $10,000 and extended benefits past
the statutory two year time limit. Binder appeals.
II. Standard of Review
The issue in this appeal is one of statutory
interpretation: whether the Board violated mandatory statutory
limitations on available reemployment benefits by ordering FHPF
to finance a second reemployment plan that, in conjunction with
Binder's first plan, will exceed the $10,000 cost limitation and
the two year time limit set forth in AS 23.30.041(l) and (k).
This question is a legal one which does not involve any
administrative expertise or the formulation of fundamental
policy. We therefore apply the independent judgment standard of
review. Flisock v. State, Div. of Retirement & Benefits, 818
P.2d 640, 642 (Alaska 1991). Exercising our independent
judgment, we will adopt the statutory interpretation that is
"most persuasive in light of precedent, reason and policy."
Langdon v. Champion, 745 P.2d 1371, 1372 n.2 (Alaska 1987).2
Binder argues that application of the reasonable basis
standard of review is appropriate. He asserts that "how a
particular injured worker is evaluated, how a reemployment plan
is devised, and put into effect, and whether or not it ultimately
succeeds or fails"are vocational rehabilitation issues best
determined by experts in the field. Moreover, since the statute
does not address "failed"reemployment plans, Binder argues that
AS 23.30.041 is ambiguous, and that the Board made a policy
determination placing the financial risk of failed plans on
employers. According to Binder, this policy determination should
be accorded deferential review.
We disagree. The question in this case is not whether
the Board reasonably determined that Binder could not
successfully perform in the video editing field within the
statute's two year time limit. Nor is there any question about
the particular reemployment training that would be most
appropriate for Binder. Accordingly, the Board's expertise in
vocational rehabilitation is not implicated in this case. The
fundamental question is one of statutory interpretation to which
we apply our independent judgment.
III. Discussion
The Board's order for a second reemployment plan
violated AS 23.30.041(l).
Alaska Statute 23.30.041 provides for workers'
compensation reemployment benefits. Pursuant to subsection (h)
of the statute, an eligible injured worker must cooperate with a
rehabilitation specialist to formulate a reemployment plan which
contains a variety of information, including the occupational
goal of the plan, a detailed schedule for achieving the goal, an
estimation of time and cost, and an assessment of the worker's
skills and capabilities. See AS 23.30.041(h). As part of the
plan, the rehabilitation counselor must determine that, in light
of the worker's skills and capabilities, the worker "can be
reasonably expected to satisfactorily complete the plan and
perform in a new occupation within the time and cost limitations
of the plan." AS 23.30.041(h)(9).
The statutory time and cost limitations for the
reemployment plan are set forth in AS 23.30.041(k) and (l), which
provide:
(k) Benefits related to the
reemployment plan may not extend past two
years from the date of plan approval or
acceptance, whichever date occurs first, at
which time the benefits expire. . . .
(l) The cost of the reemployment plan
incurred under this section shall be the
responsibility of the employer, shall be paid
on an expense incurred basis, and may not
exceed $10,000.
Binder argues that the time and cost ceilings of
subsections (k) and (l) only begin to accrue when a reemployment
plan is in fact successful, i.e., when the injured worker is
successfully restored to remunerative employability as envisioned
by the plan. Binder asserts that, when a plan is not in fact
successful, the time and cost limitations of AS 23.30.041(k) and
(l) are not set in motion, and the employee still has the full
two years and $10,000 to use as part of a new, valid plan. Thus,
Binder argues, the term "reemployment plan"includes only valid
or successful plans, and employers must bear the financial risks
associated with failed plans. As a result, Binder claims that
FHPF may be lawfully required to bear the cost of his second
plan.
The definition of a "reemployment plan"urged by Binder
is inconsistent with a reasonable reading of the statute's
language. Binder proposes a very technical definition which is
not only unsupported by the language of the statute or its
legislative history, but would create unsound policy. Binder's
argument to recognize only "successful"plans would encourage
employees to bring hindsight challenges to their plans, thereby
undermining efficiency and finality in the implementation of AS
23.30.041. This construction would also transform employers into
insurers of every rehabilitation effort, a result the Legislature
surely did not intend. We therefore reject Binder's argument and
conclude that any time and money spent on Binder's first
reemployment plan must be counted toward the statutory maximums
for which FHPF may be liable.
A number of circumstances support this conclusion.
First, there is nothing to suggest that Binder's first
reemployment plan was not valid. From the record, it appears
that all of the procedural requirements of AS 23.30.041(h) were
satisfied in developing the plan. Further, all the parties
agreed to the plan, thereby satisfying the acceptance or approval
provision of AS 23.30.041(j). Significantly, had there been any
disagreement about the terms of the plan, any party could have
submitted the plan to the RBA for approval. AS 23.30.041(j).
The RBA's decision could be reviewed in a hearing before the
Board. Id. The Board's resulting order would operate as a final
adjudication of the issue. We view the parties' agreement on a
plan in a similar perspective. That is, once the plan has been
formulated and approved by the parties and the rehabilitation
specialist, see AS 23.30.041(h), (j), their agreement acts as an
adjudication which may be altered only for limited reasons, such
as a showing of fraud, misrepresentation, or a failure to
meaningfully or substantially comply with the statutory
requirements.
There is no evidence of such circumstances in this
case. Prior to signing the plan, FHPF's obligation was to review
it for compliance with the statute and, if reasonable, to agree
to the employee's desired reemployment training. FHPF met this
obligation here. It had no obligation to insure the ultimate
success of every aspect of or expectation associated with the
plan. Similarly, no evidence in the record suggests that
Binder's chosen rehabilitation counselor failed to comply with AS
23.30.041(h) in designing and approving the video editing plan.
One aspect of the counselor's approval was his finding that
Binder could "be reasonably expected to satisfactorily complete
the plan and perform in a new occupation within the time and cost
limitations of the plan." AS 23.30.041(h)(9). There has been no
determination that this finding was unreasonable at the time it
was made. Standing alone, Binder's apparent misperception either
of his own skills and interests, or of the nature of the video
editing market in Fairbanks is insufficient to invalidate his
plan.
Given that Binder's first plan was valid, we next
review the language of AS 23.30.041(k) and (l). In doing so, we
find that the unambiguous language of these subsections states
that an employer's total exposure for any number of reemployment
plans an employee pursues must be capped at $10,000 and two years
in time.3 We therefore reject Binder's arguments in favor of a
contrary ruling. See Yahara v. Construction & Rigging, Inc., 851
P.2d 69, 72 (Alaska 1993) (this court "will neither modify nor
extend a statute if its language is unambiguous and expresses the
legislature's intent, and if its legislative history reveals no
ambiguity"); Zoerb v. Chugach Elec. Ass'n, 798 P.2d 1258, 1260
(Alaska 1990) (where a statute's meaning appears clear and
unambiguous, the party asserting a different meaning bears a
heavy burden of demonstrating contrary legislative intent).
In addition to the express language of the statute, our
conclusion is compelled by the legislative history of the 1988
amendments to the act. Numerous committee hearing records
reflect that one of the primary goals in revising the vocational
rehabilitation system was to control the costs of rehabilitation.
This was accomplished by a number of measures, including making
reemployment training voluntary and limiting the time and money
available for that training. See, e.g., An Act Relating to
Workers' Compensation, and Providing for an Effective Date:
Hearings on SB 322 before the House Judiciary Comm., 15th State
Leg. (April 16, 1988) (statement of Committee Chairperson John
Sund that the revisions to the vocational rehabilitation system
attempted to remedy the problems of the act by making the system
voluntary, and by limiting rehabilitation to two years and a
maximum $10,000); id. (statement of Dick Cattanach, member of the
task force recommending changes to AS 23.30.041, that the intent
of the task force was to cut the cost of reemployment benefits);
id. (April 15, 1988) (statement of Committee Chairperson John
Sund that the bill attempted to control costs by measures
including the $10,000 cap on vocational rehabilitation); see also
House Judiciary Comm., 15th State Leg., Sectional Analysis of
House Judiciary Comm. Substitute for Senate Bill 322, at 5 (April
6, 1988) [hereafter House Analysis] (indicating that the purpose
of the two year and $10,000 limitations was "to encourage
efficient and realistic use of rehabilitation monies by placing a
reasonable limit on them,"and noting that the overall goal of
the revisions to the vocational rehabilitation system was to
promote a system that is more prompt, more efficient, more cost-
effective and less-litigated).
The legislative history also indicates that the two
year time limitation was intended to return injured workers to
the work force as expeditiously as possible. This goal was
premised on studies showing that the longer an employee is out of
the work force, the less likely it becomes that the worker will
successfully return to it. See House Analysis at 4-5 (noting
that all known rehabilitation studies conclude that early
rehabilitation is much more likely than later efforts to result
in a return to work).
Allowing a new or substantially revised reemployment
plan to restart the two year clock would impede this objective.
Similarly, interpreting the $10,000 limitation to apply
independently to every new reemployment plan would undermine the
goal of cost control. It would also adversely affect the
efficiency and certainty of the reemployment training program,
since there would always be a possibility that an employee could
have his or her first plan declared unsuccessful, and obtain a
new plan for which the employer would have entirely new
responsibility.4
For these reasons, we conclude that any time or money
spent on the implementation of a reemployment plan agreed upon or
approved pursuant to AS 23.30.041(j) must be counted toward the
statutory maximums set forth in AS 23.30.041(k) and (l). In this
case, the Board clearly violated AS 23.30.041(l) by ordering that
FHPF must pay for a second reemployment plan that, in conjunction
with the cost of Binder's video editing plan, certainly will
exceed the $10,000 limitation.5
IV. Conclusion
In sum, based on the express language of the statute as
well as all indications gleaned from its legislative history, we
conclude that subsections (k) and (l) set forth an employer's
total liability for any number of reemployment plans that an
employee pursues. As FHPF notes, the Board's holding to the
contrary could subject an employer to unlimited exposure for
multiple reemployment plans, in violation of the statute's
language as well as the Legislature's intention. Because the
Board's order clearly exposes FHPF to reemployment training costs
in excess of $10,000, we AFFIRM the ruling of the superior court
which reversed the Board's decision.6
_______________________________
* Sitting by assignment made pursuant to article IV,
section 16 of the Alaska Constitution.
1 Following his termination from Alaska Video
Productions, Binder was employed for various intervals by FHPF as
a painter and sander, by the Fairbanks North Star Borough as a
parks laborer, and by a car wash as an attendant.
2 When the superior court acts as an intermediate court
of appeal, we will directly and independently review the merits
of the administrative determination. Flisock, 818 P.2d at 642.
3 We reject FHPF's claim that AS 23.30.041 rigidly
authorizes only one reemployment plan which, once accepted or
approved, cannot for any reason be modified in favor of a
different plan. We see very little in the statutory language or
in its legislative history to suggest that a plan may not be
modified or terminated in favor of a more suitable plan if
circumstances arising during reemployment training so warrant and
if approval is obtained pursuant to AS 23.30.041(j). To find
otherwise would remove all flexibility from the statute and could
hinder the goal of providing effective reemployment training. We
find only that any time or money expended toward prior
reemployment efforts must be counted toward the employer's total
liability under subsections (k) and (l).
4 Moreover, the revisions making reemployment training
voluntary were designed to promote an employee's active
participation in selecting his or her rehabilitation specialist
and in designing the reemployment plan. AS 23.30.041(g), (h).
Given this, there is little justification for allowing the
employee to later challenge the plan as unsuccessful and obtain a
new plan with no offset for the time and money expended toward
the earlier plan.
5 In conjunction with Binder's first plan, the actual
training time taken by his proposed second plan would total 22
months. The parties do not specifically address whether this
time period violates AS 23.30.041(k), since they do not discuss
whether the two year time limitation may be tolled by
interruptions in an employee's actual training. Because the
parties focus primarily on the Board's violation of the cost
limitation of AS 23.30.041(l), and because this violation is
clear, we do not address whether subsection (k) was violated in
this case.
6 In light of our decision, we need not address FHPF's
argument that the Board failed to select reemployment benefits
consistent with AS 23.30.041(i).
]]>
