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Blanas v. The Brower Co. (6/13/97), 938 P 2d 1056
Notice: This opinion is subject to 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, telephone
(907) 264-0608, fax (907) 264-0878.
THE SUPREME COURT OF THE STATE OF ALASKA
HARRY BLANAS, )
) Supreme Court No. S-7352
) Superior Court No.
v. ) 3AN-94-3339 CI
THE BROWER COMPANY, ) O P I N I O N
TRANSAMERICA PREMIER )
INSURANCE CO., ) [No. 4833 - June 13, 1997]
Appeal from the Superior Court of the State of Alaska, Third Judicial
Karen L. Hunt, Judge.
Appearances: Harry Blanas, pro se, Anchorage. Tracey L. Knutson,
DeLisio, Moran, Geraghty & Zobel, Anchorage, for Appellees The Brower Company,
and Transamerica Premier Insurance Co.
Before: Compton, Chief Justice, Rabinowitz, Matthews, Eastaugh, and Fabe,
Harry Blanas entered into a compromise and release (C&R) with his employer
and its insurer to resolve his workers' compensation claim. Sixteen months
later he asked the Alaska Workers' Compensation Board to reopen his claim and
modify the C&R, in part because he claimed representatives of the employer's
insurer had fraudulently induced him to settle and sign the C&R. The Board
denied his request, and the superior court affirmed. Blanas now appeals to this
court. We reverse.
II. FACTS AND PROCEEDINGS
While employed by the Brower Company in 1990, Blanas fell from a ladder
and was injured. After the initial examinations and treatment, Blanas was
referred to Dr. Michael Newman and continued under his care until April 1991.
In March 1991 Dr. Newman declared Blanas medically stable and opined that Blanas
did not have a permanent partial impairment.1 Dr. Newman stated that he doubted
that Blanas would be able to return to his previous occupation, "put him on a
restriction with maximum lifting of 50 pounds and no repetitive lifting over 25
pounds,"and noted that he "may require continued physical therapy and other
treatments for symptom management."
As part of his workers' compensation claim, Blanas requested an evaluation
of his eligibility for reemployment benefits. The reemployment benefits
administrator assigned a rehabilitation specialist to perform an evaluation.2
Based on the specialist's recommendation, the administrator found Blanas
The rehabilitation specialist developed several rehabilitation plans for
Blanas. Blanas initially expressed interest in pursuing training and employment
in drafting or hazardous material handling, the latter specifically in tank
tightness testing. In mid-January 1992 the rehabilitation specialist learned
that the physical requirements of tank tightness testing were beyond Blanas's
post-injury capacities. Soon thereafter, the rehabilitation specialist noted
that Blanas expressed interest in the occupation of construction estimator; the
rehabilitation specialist explored this rehabilitation goal. In February and
March 1992 the rehabilitation specialist worked on a new reemployment plan for
Blanas in the estimator field. Before the estimator plan was completed,
however, Blanas and Brower signed the C&R. Blanas contends that before he
signed the C&R he had no knowledge of this new reemployment plan or the
inappropriateness of tank tightness testing as a rehabilitation goal for him.
The C&R specified that $2,500 would be paid to Blanas to defray the expenses of
attending a one-week stateside course in tank tightness testing. Other
provisions in the C&R implied that Blanas was free to choose an occupation for
retraining, and mentioned several occupations the specialist had explored with
Blanas, including hazardous material handling.
The parties signed the C&R on February 13, but the Board initially
rejected it for reasons not relevant here.3 On March 11 the parties signed an
addendum containing changes that satisfied the Board. The addendum required
that $2,500 be paid for expenses on a cost incurred basis for Blanas's
"rehabilitation program as outlined." The Board approved the C&R and addendum
on March 12. The agreement resolved all disputes between the parties and
released Brower and its insurer from all claims for further benefits in exchange
Blanas asserts that after he entered into the C&R he learned that the
physical demands on a tank tightness tester exceeded his post-injury physical
capacity. Blanas contends that he then unsuccessfully searched for employment
for over a year. He enrolled in a real estate class, prepaid the fees, notified
the insurer of his change in rehabilitation plans, and requested that his
expenses be covered out of the settlement rehabilitation fund. The insurer then
proposed a second addendum to the C&R; this proposal stated that Blanas "has
determined, after the [C&R] was approved, that lifting restriction has prevented
him from performing"hazardous material handling (tank tightness testing). It
also stated that hazardous material handling was the goal of Blanas's
rehabilitation program when the Board approved the C&R. It also stated that
real estate was a different vocational goal than the one identified in the
release or explored with the rehabilitation specialist. It stated that a
maximum of $2,500 would be paid for rehabilitation training, and that the C&R
was not otherwise altered. Blanas withdrew from the real estate class when
computer examinations were added to the curriculum. Blanas refused to sign the
In July and August 1993 Blanas petitioned the Board to reopen his claim
and to modify the March 12, 1992, C&R, alleging misrepresentation, deceit, and
fraud by the representatives of Brower's insurer.5 In an affidavit filed with
the Board in October 1993, he affied that he entered into the C&R on the
representations of the insurer's representatives for "the specific purpose"of
receiving rehabilitation training in the field of tank tightness tester, to be
eligible for "available employment as represented."He affied that at the time
he signed the C&R, he had "no knowledge that the plan to retrain me as a tank
tightness tester had been abandoned as non-viable reemployment by the
rehabilitation experts." He also affied that the nonviability of that field had
been communicated to the insurer's representatives. He further asserted that he
understood, when he signed the C&R, that there was "genuine reemployment"
available in that field. Blanas sought, inter alia, payment for loss of
reasonable earnings from the date of the release forward, damages for the loss
of a reasonable rehabilitation program, and emotional and punitive damages.
Blanas also argued, in objecting to the Board chair's assessment of the issues,
that his affidavit established that the insurer's representatives knew the
rehabilitation field specified in the C&R offered Blanas no reemployability, but
that they elected not to disclose that fact to Blanas.
The Board denied Blanas's petition in mid-March 1994. It held that it
lacked jurisdiction to set aside the C&R due to unilateral or mutual mistake of
fact, citing Olsen Logging Co. v. Lawson, 856 P.2d 1155, 1159 (Alaska 1993). It
also held that, while it had the authority to permit an independent action to
set aside the C&R, Blanas's fraud allegations were "probably unfounded"and that
even if they were not, they did not rise "to the level of fraud required for an
independent action"as defined by Alaska case law.
Blanas asked the Board to reconsider. In a sworn statement filed with the
Board in late March, Blanas asserted that the insurer's representatives knew the
tank tightness testing goal had been abandoned January 15, 1992, and that,
although its representatives already knew that the goal was unsuitable for
Blanas, on January 19 the insurer made the settlement offer based on the tank
tightness testing goal. He characterized the result as the "theft of Blanas'
rights by deception." He filed new pleadings attempting to reopen the
modification issue. He asserted that the C&R was based on two considerations:
(1) the cash settlement for the injury, and (2) the tank tightness tester
rehabilitation training. He argued that Brower had admitted Blanas had not
received the "specific rehabilitation."
At a preconference hearing, the parties agreed that all issues presented
in Blanas's original petitions and subsequent pleadings would be addressed in a
final proceeding before the Board. Blanas argued that he had been deprived of
his right to call witnesses and right to due process of law. He had listed
witnesses who theoretically would have been knowledgeable about facts, allegedly
supporting his assertion that the insurer's representatives had induced him to
sign the C&R knowing he could not meet the specified reemployment goal. The
Board denied Blanas's request for reconsideration.
Blanas appealed to the superior court. (He filed his appeal before the
Board denied his motion for reconsideration, but obtained a superior court order
staying the appeal pending the Board?s resolution of that motion.)
The superior court affirmed the Board's denial of Blanas's petition to set
aside the C&R. Blanas then filed this appeal.
A. Standard of Review
We give no deference to the decision of a superior court acting as an
intermediate court of appeal, and independently review the merits of an
administrative decision. Handley v. State, Dep?t of Revenue, 838 P.2d 1231,
1233 (Alaska 1992). We there summarized the different standards for reviewing
We have recognized four principal standards of review of administrative
decisions. The "substantial evidence"test is used for questions of fact. The
"reasonable basis"test is used for questions of law involving agency expertise.
The "substitution of judgment"test is used for questions of law where no
expertise is involved. The "reasonable and not arbitrary"test is used for
review of administrative regulations.
Id. (citing Jager v. State, 537 P.2d 1100, 1107 n.23 (Alaska 1975)).
Whether the Board had jurisdiction or authority to set aside the C&R is a
legal question involving the interpretation of AS 23.30.012. We review
questions of statutory interpretation under the substitution of judgment
standard. Raris v. Greek Corner, 911 P.2d 510, 511 n.3 (Alaska 1996).
B. Denial of Blanas's Petition to Reopen or Modify the C&R without a
Blanas argues that the superior court erred in affirming the Board because
he was denied a fair hearing before the Board. Blanas asserts that the C&R
should be set aside because Brower's insurer secured the release through duress,
coercion, fraud, and misrepresentation. He claims that the insurer knew that
the rehabilitation goal identified in the C&R, tank tightness testing, was
physically unsuitable for him; he asserts that he would not have signed the C&R,
with its financial limitation on rehabilitation training, if he had known this
was not a realistic reemployment goal.6
Brower and its insurer correctly assert that the primary issue before us
is whether the Board had authority to set aside the C&R. They first argue that
the Board had no authority to set aside a C&R for a mistake of fact.
1. Mistake of fact as basis for relief
Alaska Statute 23.30.012 governs C&R agreements for workers' compensation
claims. In Olsen Logging, we interpreted that statute and held that the Board
has no authority to set aside a C&R for a mistake of fact. 856 P.2d at 1158.
We there stated:
Alaska Statute 23.30.012 governs the compromise and release of workers'
compensation claims. That statute provides that settlement agreements are not
valid until they are approved by the Board. Upon approval by the Board,
settlement agreements have the same legal effect as awards, except that they are
more difficult to set aside:
If approved by the board, the agreement is enforceable the same as an
order or award of the board and discharges the liability of the employer for the
compensation notwithstanding the provisions of AS 23.30.130 [modification of
awards], 23.30.160 [assignment and exemption of claims], and 23.30.245 [invalid
The Board has the authority to modify awards on its own initiative or upon
application of any party for a change in conditions or because of "a mistake in
its determination of a fact." This power, however, is subject to a time limit
of "one year after the date of the last payment of compensation benefits . . .
." AS 23.30.130(a). The power to modify awards for changed conditions or
mistakes of fact expressed under subsection .130
does not, however, extend to settlements. Subsection .012 provides that
approved settlement agreements discharge the liability of the employer for
compensation notwithstanding subsection .130. This is, therefore, an expression
of legislative intent that approved agreements may not be modified because of
mistakes of fact.
Id. at 1158-59 (emphasis in original) (footnotes omitted). Relying on
this passage from Olsen Logging, the Board held that it did not have the
jurisdiction to set aside the C&R based on Blanas's allegations that the release
was signed by mistake. It did not err in so holding.
2. Fraud as basis for relief
This appeal is not resolved by our conclusion that the Board could not set
aside the C&R for an alleged mistake of fact. Blanas expressly asserted that
the insurer had obtained his signature on the C&R by fraudulently concealing or
misrepresenting Blanas's reemployability in the occupation specified. He
claimed that rehabilitation training in that occupation was one of the two bases
for his willingness to settle, and argued that the $2,500 rehabilitation
training allowance would have covered tank tightness testing training, but would
have been insufficient to cover other training that would make him reemployable.
The Board acknowledged that Blanas was alleging fraud and
misrepresentation. The Board stated that footnote 4 of Olsen Logging recognized
the possibility of "an independent action to relieve a party from a judgment
under Civil Rule 60(b)." Based on this footnote and Professor Larson's
treatment of this issue in his treatise,7 the Board concluded that it had the
authority to permit an independent action to set aside the C&R based on fraud.
The Board held that the C&R could not be set aside, however, because the conduct
alleged by Blanas, if it occurred, did not rise to the level of fraudulent
behavior required for an independent action to set aside a judgment.
We first consider whether the Board even had the power to set aside a
fraudulently obtained C&R. In Greater Anchorage Area Borough v. City of
Anchorage, 504 P.2d 1027, 1033-34 (Alaska 1972), this court held that the Alaska
Public Utilities Commission exceeded its statutory authority when it adjudicated
a dispute not within the Alaska Public Utilities Commission Act. In so holding,
it approvingly quoted a Washington Supreme Court opinion containing the
It is well settled . . . that a public service commission is an
administrative agency created by statute and as such has no inherent powers, but
only such as have been expressly granted to it by the legislature or have, by
implication, been conferred upon it as necessarily incident to the exercise of
those powers expressly granted.
Id. at 1033 n.19. Even though the legislature did not expressly give the
Alaska Workers' Compensation Board authority to set aside a C&R for fraud, we
conclude that the power to do so has "by implication, been conferred upon it as
necessarily incident to the exercise"of the adjudicatory power expressly
Courts in other jurisdictions considering this issue have held that the
board has the inherent or implied power to set aside settlement agreements that
it has approved when the agreement is procured by either the employee's or the
employer's fraud. See Beese v. First Nat'l Stores, 244 A.2d 689, 691 (N.J.
1968) (noting that the Worker's Compensation Bureau possesses the inherent
power, apart from a recently enacted statute providing the Board with express
power to reopen awards "for good cause shown"within one year of its judgment,
to reopen judgments for fraud, mistake, inadvertence or other equitable
grounds); Estelle v. Board of Educ., 102 A.2d 44 (N.J. 1954) (holding that the
Workmen's Compensation Division has "that power inherent in all tribunals to
reopen judgments in instances of fraud"); Hyman v. Essex City Carpet Cleaning
Co., 385 A.2d 257 (N.J. App. 1978) (holding "[i]rrespective of the absence of
express statutory authority and a one year limitation imposed upon such a
reopening in certain circumstances . . . it is abundantly clear that the
Division has the inherent power, 'comparable to that possessed by the courts . .
., to reopen judgments for fraud, mistake, inadvertence or other equitable
ground.'"(citation omitted) (emphasis omitted)).
In addition, the Florida Court of Appeal, relying upon a provision of
Florida's workers' compensation statute stating that a Judge of Industrial
Claims (JIC) has the "authority to do all things conformable to the law which
may be necessary to discharge the duties of the office,"found that the JIC had
the authority to set aside a settlement agreement it had approved when it was
discovered that the claimant had procured the settlement through
misrepresentations and fraud. Morgan Yacht Corp. v. Edwards, 386 So. 2d 883,
884 (Fla. App. 1980). The court further stated that "[i]t would be
inconceivable to give a Judge of Industrial Claims authority to approve a
settlement but no authority to rescind his action when it is based on
misrepresentations and fraud." Id.
Brower and its insurer do not argue that the Board erred in concluding
that it had this power; their argument instead seeks to demonstrate that the
Board correctly concluded that Blanas did not establish the existence of fraud
sufficient to justify relief. We conclude that the Board did not err
in holding that it has authority to set aside a C&R obtained fraudulently.
Alaska Statute 23.30.012 does not limit this inherent power; that statute simply
prevents the Board from reopening a settlement on grounds for relief covered by
AS 23.30.130, AS 23.30.160, and AS 23.30.245. Those sections do not discuss
fraud, and they and AS 23.30.012 have no application here.
In Olsen Logging we commented on the possibility that an independent
action might be maintained to relieve a party of a Board-approved settlement,
and cited Civil Rule 60(b), which adverts to the possibility of an independent
action. 856 P.2d at 1159 n.4. That dictum did not state or imply that Rule
60(b) necessarily governs a petition of the sort filed by Blanas. Nor did it
suggest that relief in such a case can be obtained exclusively by filing an
independent action. We now conclude that one permissible way to seek relief
from a Board-approved C&R on the ground it was fraudulently induced is to do
what Blanas did: petition the Board to set aside or modify the C&R in the same
workers' compensation case the C&R was intended to resolve.
Civil Rule 60(b) recognizes two categories of fraud that justify judicial
relief from a judgment. For most fraud, such as that perpetrated by one party
against another, a party can obtain relief from a judgment by moving under Rule
60(b)(3). Rule 60(b) also recognizes the inherent power of courts to set aside
judgments for fraud upon the court. Alaska R. Civ. P. 60(b) ("This rule does
not limit the power of a court . . . to set aside a judgment for fraud upon the
In a judicial proceeding, one important practical difference between
"regular"fraud and fraud upon the court is the amount of time a party has in
which to seek relief. A party asserting "regular"fraud must move for relief
within a reasonable time after the judgment, not to exceed one year. See Allen
v. Bussell, 558 P.2d 496, 499 (Alaska 1976); Alaska R. Civ. P. 60(b)(3). In
comparison, "the one-year time limitation does not apply to proceedings to
correct orders obtained by fraud upon the court." Mallonee v. Grow, 502 P.2d
432, 437 (Alaska 1972). Thus, whether a party asserts "regular"fraud or a
fraud upon the court potentially has an important bearing on the timeliness of
the Rule 60(b) motion.
In its original decision the Board did not explicitly state that
Blanas was required to show fraud upon the court to obtain relief. Nonetheless,
its opinion defined this type of fraud and concluded that "we find nothing,
including any of the employee's allegations, which rises to the level of fraud
required for an independent action, as defined in the above cases."
Furthermore, when it denied reconsideration, the Board stated that it had
originally declined to set aside the C&R because it had concluded that it had no
jurisdiction to do so on the basis of mistake and because it "did not believe
that fraud had been committed on the board by the insurer." (Emphasis added.)
The Board thus appears to have concluded that Blanas, to prevail, had to
demonstrate fraudulent behavior constituting a fraud upon the tribunal. The
Board did not consider whether there was "regular"fraud, nor did it treat
Blanas's petition as a Rule 60(b)(3) motion alleging such fraud.
The Board's decision and the insurer's argument both imply that, because
Blanas sought relief more than one year after the Board approved the C&R, he had
to demonstrate there had been a fraud upon the tribunal. This notion is
apparently based on an assumption that Rule 60(b) governs Blanas's petition. In
our view, it does not. As we intimated in Olsen Logging, 856 P.2d 1159 n.4,
Rule 60(b) may provide a convenient model for seeking relief from a C&R approved
by the Board. Nonetheless, it is an inexact model. The beneficent purposes of
Alaska's Workers' Compensation Act would not necessarily be advanced by
wholesale adoption of a judicial rule whose purpose is to balance societal needs
for judicial finality against party needs for just treatment. Further, the
Alaska Workers' Compensation Act contains no time limits applicable here, and we
have been reluctant to impose time limits when the legislature has not chosen to
do so. Huston v. Coho Elec., 923 P.2d 818, 820 (1996); Tipton v. ARCO Alaska,
Inc., 922 P.2d 910, 913 (1996). Because we conclude that the one-year
limitation found in Rule 60(b) does not apply to a petition asking the Board to
set aside a C&R which was allegedly obtained fraudulently, a distinction between
"regular"fraud and fraud upon the court has no bearing on the timeliness of
Blanas's petition. To the extent it appears to have relied upon such a
distinction in denying Blanas's petition, the Board erred. It consequently may
have failed to weigh adequately the substance of Blanas's fraud claim or his
related misrepresentation claim.
It follows that we reject the insurer's argument that Blanas's petition,
filed some sixteen months after the Board approved the C&R, was untimely.
Nothing in the workers' compensation act makes Blanas's petition untimely. The
one-year limitation found in AS 23.30.130 applies to changes in conditions and
mistakes; it has no express application to claims of fraud or misrepresentation.
For reasons previously addressed, we decline to adopt Rule 60(b)'s one-year
limit for such a case.
3. Evidentiary Hearing
The Board held that even if Blanas's allegations were true and Brower knew
that the C&R rehabilitation goal was physically inappropriate for Blanas, these
facts would not justify setting aside the C&R. Quoting statements from the C&R
that Blanas had successfully run his own business and had been gainfully
employed for over thirty years, the Board concluded that Blanas was "motivated
to remove himself from the rehabilitation process"and "wished to become self-
employed."8 The Board did not explicitly articulate the basis for its holding.
It apparently believed that even if Blanas was unaware of the physical
requirements of tank tightness testing, "good conscience"did not preclude
enforcement of the C&R because Blanas had signed the C&R based on his desire to
be out of the workers' compensation system and had the experience and skills to
pursue rehabilitation and reemployment on his own.
The Board also stated that Blanas's "allegation that the employer had
knowledge that the reemployment goal . . . was physically inappropriate for him
to perform is probably unfounded." The record shows that the rehabilitation
specialist knew as of January 15 that tank tightness testing was inappropriate
and memorialized in the January 28 report the date when this knowledge was
acquired. Blanas's sworn averments assert or reasonably imply that he did not
know of the unsuitability of this occupation (and thus the futility of the
retraining) until after the Board had approved the C&R, and that the insurer
concealed or failed to disclose that knowledge in time for Blanas either to
negotiate settlement terms that guaranteed him retraining in an occupation he
could follow, or, alternatively, to proceed to hearing to pursue all his
Different conclusions might also be drawn. The day after the specialist
learned of the physical requirements which disqualified Blanas for the
occupation of tank tightness tester, she scheduled a meeting with Blanas to
discuss that occupation. The reemployment report states that when Blanas and
his wife met with the specialist on January 20, Blanas expressed an interest in
the occupation of construction estimator and requested that the specialist
explore this as an employment goal. This might imply that the rehabilitation
specialist informed Blanas of the physical requirements of tank tightness
testing at the January 20 meeting. The parties did not sign the C&R until
February 13, and the Board did not approve the C&R and addendum until March 12.
The Board apparently determined that Blanas was not influenced by the insurer's
alleged acts, and, moreover, that those acts did not constitute fraud upon the
court. Had it conducted a hearing at which evidence could be offered concerning
those issues, perhaps the Board could have permissibly so determined.
Given Blanas's affidavits asserting that he did not know what the insurer
knew when he signed the C&R, however, we conclude that the Board erred in
holding that Brower was probably aware of the inappropriateness of the
rehabilitation goal identified in the C&R and in implying that Blanas made a
considered choice, uninfluenced by any alleged fraud attributable to the
insurer. Substantial evidence does not support the Board's finding, because the
Board never heard the evidence necessary to resolve this dispute. Blanas listed
witnesses who allegedly would have testified on these matters, but the Board
never heard them. Blanas asked for a hearing, but never received one. We
cannot say that the Board's error was harmless just because some parts of the
record imply that Blanas was equally knowledgeable and made a considered choice.
Neither the Board nor we can conclude from the record that Blanas's allegations
of fraud are without merit as a matter of law.
Blanas also argues that he was denied a fair hearing before the Board
because it did not hear testimony and that the Board's procedures violated his
due process rights guaranteed by article I, section 7 of the Alaska
Constitution. It is not necessary to reach these arguments. Reversal and
remand are required because we have concluded that Blanas established that there
was a genuine fact dispute about whether the C&R was the product of fraud or
misrepresentations; this dispute can be resolved only by further proceedings
before the Board, including, if necessary, a hearing at which the parties can
4. Rehabilitation fund
Finally, Blanas argues that the Board's decision does not resolve his
rights to rehabilitation and to the $2,500 set aside for rehabilitation
expenses. The Board's decision denying Blanas's petition for reconsideration,
however, stated that the $2,500 was "apparently"still being held in trust and
"should be paid." Given this observation, and the position taken by the insurer
and Brower in their proposed second addendum (which authorized using the fund
for the cost of real estate agent training), it seems undisputed that retraining
costs up to the $2,500 maximum will be paid by the rehabilitation fund should
the Board not set aside or modify the C&R. If the Board sets aside the C&R and
reopens Blanas's claim, Blanas will have an opportunity either to seek an award
of all necessary rehabilitation costs from the Board, or to bargain for them if
the parties again discuss settlement. Alternatively, Blanas may succeed in
persuading the Board to modify the C&R provisions, including those dealing with
We REVERSE the superior court judgment and REMAND to that court with
directions to remand to the Board for further proceedings consistent with this
1 Dr. Morris Horning also rated Blanas at a zero percent
permanent partial impairment.
2 AS 23.30.041(c) states:
If an employee suffers a compensable injury that may permanently preclude
an employee's return to the employee's occupation at the time of injury, the
employee or employer may request an eligibility evaluation for reemployment
benefits. The employee shall request an eligibility evaluation within 90 days
after the employee gives the employer notice of injury unless the administrator
determines the employee has an unusual and extenuating circumstance that
prevents the employee from making a timely request. The administrator shall, on
a rotating and geographic basis, select a rehabilitation specialist from the
list maintained under (b)(6) of this section to perform the eligibility
3 Pursuant to AS 23.30.012, a settlement agreement is void if
not approved by the Board.
4 In pertinent part, the release stated:
In order to resolve this claim it is agreed that Mr. Blanas will be paid a
total of $32,500.00. Of that amount, $20,000.00 represents 18 months of .041(k)
benefits which is being paid to support Mr. Blanas through his retraining
process. In addition, $2,500.00 is being paid to Mr. Blanas to defray the cost
of transportation and schooling for a one week course in either Chicago or New
Jersey on tightness testing as part of the plan for hazardous material handling.
This amount would also defer the expenses of room and board and other related
expenses while attending the week long school.
The remainder of the $32,500.00 is allocated as a compromise of Mr.
Blanas' claim that he is entitled to further temporary total disability benefits
and permanent partial impairment benefits. In exchange, Mr. Blanas waives any
claims he may have against Transamerica, Wilton Adjustment, GAB and/or their
representatives for interference with his medical treatment or selection of
physician or any claims that he may make for bad faith. In addition, he waives
any rights that he may have under the Workers' Compensation Act with the
exception of medical benefits which are payable pursuant to the Workers'
Compensation Act in the future.
5 Blanas has appeared pro se before the Board, superior court,
and this court. Blanas and Brower dispute whether Blanas had an attorney review
the C&R prior to its signing.
6 Blanas also asserts that he signed the C&R under duress
because the insurer had coerced and improperly influenced his doctors to issue
premature medical stability diagnoses, to issue zero percent impairment ratings,
and to limit examinations and treatment. Because his appellate briefs contain
no legal discussion of those assertions as a basis for relief, we do not reach
them. Adamson v. University of Alaska, 819 P.2d 886, 889 n.3 (Alaska 1991)
("[W]here a point is given only a cursory statement in the argument portion of a
brief, the point will not be considered on appeal.").
7 The Board quoted at length from Professor Larson's treatise,
which describes the basic rule for reopening a case for fraud and defines the
fraudulent behavior that would justify a reopening. The following is a portion
of the treatise passage quoted by the Board:
Apart from reopening for change in condition where available under the
foregoing analysis, and apart from express statute, awards and settlements
cannot be disturbed except upon a showing that they were procured by fraud.
This remedy may be based on either specific provisions of the compensation act
or upon the general power of courts to set aside judgments obtained by fraud.
. . . .
Fraud may be in the form of intentional deception, as when the employer
dishonestly induced the signing of an agreement by telling the employee that
this was necessary if the employee was to have his medical expenses paid, or by
falsely telling the employee that he would be able to hold his old job, and as
when the employee in obtaining a settlement misrepresented the circumstances of
an accident, saying that it was the result of inadvertently tripping over an air
hose when in fact it was the result of horseplay. But the "fraud"may also be
constructive, and may even consist, for example, in the honest but entirely
erroneous opinion, expressed by the insurance representative and insurance
doctor in the agreement negotiations, that claimant's condition would clear up
in sixty days, when that opinion induced claimant to acquiesce in the agreement.
As to doctors, courts have found constructive fraud sufficient to justify
reopening when even an innocent misrepresentation has been made by a physician
chosen by the employer or its insurer, and those representations, have been
relied on by the claimant. If, however, claimant has relied on the
representations of her own physician, there has been no fraud.
Ignorance or misunderstanding on the claimant's part will not in itself
justify reopening a settlement or award, if the employer had nothing to do with
inducing claimant's misapprehension. So, when claimant alleges that he
belatedly discovered that he might have a claim under a different statute, or
when he says that he was incapable of understanding the legal implication of the
agreement he signed, reopening will not be granted in the absence of fraud or
insanity. And even as to insanity, North Carolina has ruled that an assertion
that claimant was mentally incompetent at the hearing due to his brain injury
was not of itself sufficient ground to set aside the judgment denying
3 Arthur Larson, The Law of Workmen's Compensation ? 81.51(a), (b), 15-
1120 to 1134 (1992).
8 In support of its holding, the Board quoted the following
language from the C&R:
Mr. Blanas selected Kathy Williams for preparation of a reemployment
benefits plan. Several options have been explored including computer assisted
drafting, hazardous material handling and at Mr. Blanas' request, paralegal. A
market was found for both the computer assisted drafting and the hazardous
material handling. Further training has been identified as available for both
and both present the option of remunerative employment.
Mr. Blanas is aware that he could continue participating in reemployment
benefits with the guidance of Kathy Williams. However, he feels that his
background provides him with sufficient experience and training to conduct his
own retraining program. Mr. Blanas, in the past, has been self-employed and
successful, ran his own business and has been gainfully employed for over 30
years. He does not desire to remain within the workers' compensation system,
but rather wishes to settle his case and pursue his own options for
reemployment, including the potential of paralegal.