You can search the entire site. or go to the recent opinions, or the chronological or subject indices. Gunter v. Kathy-O-Estates (03/19/2004) sp-5789
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, phone (907) 264-0608, fax (907) 264-0878, e-mail firstname.lastname@example.org. THE SUPREME COURT OF THE STATE OF ALASKA JERRY GUNTER, ) ) Supreme Court No. S-10931 Appellant, ) ) Superior Court No. v. ) 3AN-99-12483 CI ) 3AN-88-843 P/C KATHY-O-ESTATES, et al., ) ) O P I N I O N Appellee. ) ________________________________) [No. 5789 - March 19, 2004] Appeal from the Superior Court of the State of Alaska, Third Judicial District, Anchorage, Elaine M. Andrews, Judge. Appearances: Jerry Gunter, pro se, Anchorage. Allan E. Tesche, Russell, Tesche, Wagg, Cooper & Gabbert, Anchorage, for Appellee. Before: Fabe, Chief Justice, Matthews, Eastaugh, Bryner, and Carpeneti, Justices. CARPENETI, Justice. I. INTRODUCTION I. Jerry E. Gunter was permanently and totally disabled by a brain injury he suffered while working for Kathy-O-Estates. Gunter and Kathy-O-Estates entered a compromise and release agreement settling their dispute over Kathy-O-Estatess workers compensation liability due to that injury. This case involves Gunters attempt to overturn that agreement. The superior court appointed the Community Advocacy Project of Alaska, Inc. as Gunters guardian/conservator and gave it the power, which the Community Advocacy Project then exercised, to dismiss Gunters claims. Gunter also sought reimbursement for various costs related to his brain injury. These claims were denied by the Alaska Workers Compensation Board and this denial was upheld by the superior court. We affirm the denial of Gunters reimbursement claims because the Alaska Workers Compensation Board correctly concluded that it lacked the authority to reimburse Gunter for the financial consequences of his work- related injury. We affirm the denial of Gunters attempt to overturn the compromise and release because the superior court properly vested Gunters guardian/conservator with the authority to dismiss the claim on Gunters behalf. II. FACTS AND PROCEEDINGS A. Facts Jerry E. Gunter suffered a severe head injury in a traffic accident on April 4, 1988 while working for Kathy-O- Estates, his parents business. He was permanently and totally disabled as a result of the accident. Kathy-O-Estates and its insurer, Firemans Fund Insurance Company, were liable for benefits under the Alaska Workers Compensation Act. The parties1 agreed to settle the workers compensation disputes stemming from the injury by entering into a partial Compromise and Release (C & R). The C & R provided that Gunter would be paid $175 per week for ten years and $200 per week after that. It was signed by both Gunters guardian and his attorney, and was approved by the board on November 18, 1992. B. Proceedings A. Gunter filed a workers compensation claim requesting that the board overturn the C & R in July 1998. The board originally refused to allow Gunter to proceed with his claim, ordering the Community Advocacy Project of Alaska, Inc. (CAPA) to seek a court- appointed guardian for Gunter. Gunter amended his complaint attempting to overturn the C & R in 1999 and added a number of claims against Kathy-O-Estates which have nothing to do with medical treatment, rehabilitation, or disability benefits. These claims included reimbursement for: a $500 fine imposed on him for disorderly conduct; the costs of court-ordered alcohol and drug testing and treatment; $500 in unpaid rent by one of his roommates; $10,000 for theft by a roommate; $4,000 for a stolen watch; and $6,000 for one-half of the value of his river boat. The board concluded that Gunters claims were not compensable under the Alaska Workers Compensation Act and, consequently, that it lacked authority to impose liability for them on Kathy-O- Estates. The board dismissed and denied all claims. Superior Court Judge Elaine M. Andrews affirmed the boards denial of Gunters reimbursement claims in February 2002, citing as justification the reasons stated in [the boards] decision, and based on the analysis contained in [Kathy-O-Estatess] brief. The boards December 1999 opinion reaffirmed its earlier refusal to allow Gunter to proceed with his attempt to overturn the C & R unless he was represented by a court-appointed guardian or other competent representative. In September 2001, after an unsuccessful attempt to find counsel willing to represent Gunter, the superior court appointed CAPA as Gunters guardian/conservator. In January 2002 the superior court ordered the board to dismiss all of Gunters pending claims, including his challenge to the C & R, upon the filing with the board of a stipulation by CAPA to dismiss Gunters claims. CAPA filed such a stipulation and the board dismissed Gunters pending claims.2 Gunter, appearing pro se, appeals these decisions.3 III. STANDARD OF REVIEW We independently review the merits of an administrative boards decisions when the superior court is acting as an intermediate court of appeal in an administrative matter.4 We have established that [i]n questions of law involving an agencys expertise, a rational basis standard will be applied and we will defer to the agencys jurisdiction as long as it is reasonable.5 But we will use our independent judgment in reviewing questions of law that do not involve an agencys expertise.6 In applying our independent judgment we will adopt the rule of law that is most persuasive in light of precedent, reason, and policy.7 We review the appointment of a limited guardian or conservator for abuse of discretion.8 We review factual findings involved in determining whether a guardian or conservator should be appointed for clear error.9 We decide today that we will review a wards challenge to the dismissal of his or her legal claims by a guardian or conservator by determining whether the ward presents a colorable legal claim. IV. DISCUSSION A. The Board Was Correct in Deciding that Gunters Claims Seeking Reimbursement for a Court-Imposed Fine, Court-Ordered Alcohol Treatment and Testing, Theft, Unpaid Rent, an Interest in a Boat, and an Interest in Kathy-O-Estates Are Not Compensable. A. Gunter claims that Kathy-O-Estates should reimburse him for a court-imposed fine for disorderly conduct, related court- ordered alcohol treatment and testing, rent that his roommates failed to pay, money and a gold watch allegedly stolen by his roommates, and a half-interest in a boat that he transferred to a mechanic because he was unable to maintain the boat on his own.10 He contends that Kathy-O-Estates should be held liable for all of these costs because none of them would have been incurred if his brain had not been injured in his work-related accident; he states that [m]y brain is broke in half from work. Therefore [Kathy-O-Estates] is responsible for everything that I do or what happen[s] to me. Specifically, he contends that he would not have been convicted of disorderly conduct and ordered to pay the associated fine and treatment costs if his brain had not been injured. He also reasons that if he had not been injured, he would not have been forced to live with roommates, and therefore would have been spared their alleged thefts. The board found that it had to dismiss Gunters claims because it lacked legal authority to award the relief he requested. It noted that it had no authority over Gunters reimbursement claims because claims for expenses for court- ordered alcohol abuse counseling, rent owed due from a former roommate, thefts and damage by another roommate, alcohol and drug testing, . . . one-half the value of a boat, and a stolen gold watch are either criminal matters or claims for general civil damages, not claims under specific provisions of the Alaska Workers Compensation Act. The board was correct in concluding that it can only adjudicate a dispute if the legislature has granted it adjudicatory authority.11 Therefore, we determine this issue by examining whether the board had authority over Gunters claims. We find it unnecessary separately to address the issue whether the board correctly determined that it lacked jurisdiction to interfere with criminal sanctions and penalties. Instead, we affirm the boards dismissal of all of Gunters reimbursement claims because those claims are not compensable under the workers compensation act.12 The board was created by the act and its authority is limited to the powers and duties prescribed by that act.13 Therefore, the board was empowered to grant Gunters reimbursement claims only if his claims were compensable under the act. The workers compensation act provides that employers are strictly liable to their injured employees for medical treatment, rehabilitation, and disability benefits.14 Gunters reimbursement claims do not involve issues of medical treatment, rehabilitation, or disability benefits.15 Because the board is empowered to provide compensation under the act and because the act does not provide a means of compensating employees for the remote consequences of their injuries, such as those for which Gunter seeks reimbursement, the board was correct in deciding that it did not have the authority to grant Gunters requested relief. To the extent that Gunter was seeking reimbursement outside of the structure provided by the workers compensation act, the board was correct that the act immunized Kathy-O- Estates from such civil liability. The act generally provides the exclusive remedy for injured employees: Alaska Statute 23.30.05516 establishes that an employers workers compensation liability, which the employer must pay irrespective of fault, is the exclusive remedy for an employee injured during the course of employment.17 This limited workers compensation remedy was made exclusive for the benefit of both employers and employees: The exclusiveness of the remedy reflects a quid pro quo exchange of rights and liabilities for both workers and employers. Workers gain an assured remedy without the burden of proving fault, but lose the right to sue their employers in tort. Employers gain relief from large tort damage awards and enjoy an absolute limit on liability under the Act, but are liable without fault for injuries covered under the Act. The remedy provided by the act is exclusive, and employees generally cannot obtain compensation outside of the system provided by the act. Because Kathy-O-Estates provided workers compensation benefits, the board was correct that Kathy-O-Estates is immune from Gunters claims seeking to impose general civil liability on it. Kathy-O-Estates is only liable for the benefits provided by the act because Kathy-O-Estates is paying compensation pursuant to AS 23.30.055 under the C & R. Gunters claims are not compensable because the limited and exclusive nature of workers compensation benefits precludes Gunter from pursuing any claims for compensation beyond the wage-based compensation provided by the act. B. The Superior Court Did Not Err in Allowing CAPA To Dismiss Gunters Attempt To Overturn the C & R that Governed Kathy-O- Estatess Workers Compensation Obligation to Him. A. Gunter also challenges the 1992 C & R in which the parties agreed that Kathy-O-Estates would pay Gunter $175 per week for ten years and $200 per week after that. Gunter filed a claim seeking to overturn the C & R on July 8, 1998. The board initially determined, based on the opinion of Dr. Paul L. Craig, that Gunter was not competent to represent himself in seeking to overturn the C & R. It postponed ruling on Gunters attempt to overturn the C & R because CAPA was attempting, pursuant to a superior court order, to find an attorney to represent Gunter in the matter. CAPA was unable to find an attorney willing to take Gunters case, and the superior court appointed CAPA as Gunters guardian/conservator to provide legally trained staff to informally advise and assist Gunter in [these] proceedings. The superior court ordered the board to dismiss all pending claims, including Gunters challenge to the C & R, if CAPA filed a stipulation to that effect. This stipulation was filed and the board dismissed Gunters pending claims.19 Gunter appeals the superior courts dismissal of his challenge to the C & R, and, by implication, the superior courts decision allowing CAPA, as Gunters guardian/conservator, to stipulate to the dismissal of Gunters challenge to the C & R. We must analyze Gunters appeal in light of the superior court order denying Gunter the power to challenge the C & R without the assistance of counsel or his guardian/conservator. The order would appear to prevent Gunter from pursuing this appeal. But we recognize that a ward must have some means of contesting legal decisions made by his or her guardian. We conclude that we should review a wards appeal of a tribunals dismissal of his or her case pursuant to a guardians or conservators decision to dismiss the case by determining whether the ward presents a colorable, or plausible, claim.20 If the ward presents such a claim, we will appoint counsel to assist the ward in pursuing it. In this case, we would appoint counsel to assist Gunter in pursuing his challenge to the C & R if he presented a colorable claim that the superior court should not have allowed CAPA to dismiss his attempt to overturn the C & R. Upon our review of the record, we conclude that Gunters challenge to the dismissal of the C & R is not colorable.21 In examining Gunters appeal of the dismissal of his challenge to the C & R, the key question is whether the superior court erred by granting CAPA the authority to dismiss Gunters claims. We have established that a properly appointed conservator has the authority to settle a lawsuit under AS 13.26.280(c)(19).22 Therefore, CAPAs dismissal of Gunters challenge to the C & R can be challenged on only two grounds on appeal: (1) that CAPA was improperly appointed as guardian/conservator with authority over Gunters workers compensation claims or (2) that CAPAs actions were unreasonable. Because CAPA was properly appointed as guardian/conservator over Gunters claims and because CAPAs actions with respect to those claims were reasonable, Gunter does not have a plausible challenge to the superior courts decision granting CAPA the authority to dismiss Gunters claims and the resulting dismissal of those claims. 1. CAPA was properly appointed as Gunters guardian/conservator with authority over his claims seeking to overturn the C & R. Gunter has a long history of guardianship and conservatorship proceedings, and the superior courts order appointing a guardian/conservator in September 2001 relies on that history. Though guardianship and conservatorship proceedings are quite similar, there are separate statutes governing each appointment. Alaska Statute 13.26.165, which governs the appointment of conservators, provides that: [u]pon petition and after notice and hearing in accordance with the provisions of AS 13.26.165-13.26.315, the court may appoint a conservator or make other protective order for cause as follows: . . . . (2) appointment of a conservator or other protective order may be made in relation to the estate and affairs of a person if the court determines that (A) the person is unable to manage the persons property and affairs effectively for reasons such as mental illness, mental deficiency, physical illness or disability . . . and (B) the person has property which will be wasted or dissipated unless proper management is provided . . . Likewise, AS 13.26.113(e), which governs the appointment of guardians, provides that after a hearing, [i]f it is found that the respondent is able to perform some, but not all functions necessary to care for the respondent, and alternatives to guardianship are not feasible or adequate to provide for the needs of the respondent, the court may appoint a partial guardian, but may not appoint a full guardian. The partial guardians authority is limited to the powers and duties respecting the ward enumerated in the court order.23 It is apparent from the record that CAPAs authority to dismiss Gunters claims for him was properly established in a manner that protected Gunters rights under either the guardianship or conservatorship statutes. In its September 2001 order, the superior court modified Gunters existing guardianship order to make CAPA Gunters temporary, partial guardian/conservator [f]or the purposes of advising and assisting Mr. Gunter in all administrative proceedings before the [board]. The superior court order specifically granted CAPA the authority to allow those proceedings to continue, engage in settlement negotiations and enter into binding settlement agreements on Mr. Gunters behalf, or dismiss those actions on behalf of Mr. Gunter where CAPA determines that such action is in his best interests. The superior court held a hearing, at which Gunter was represented by an attorney and had the benefit of a court- appointed visitor.24 The superior court based its appointment of CAPA, for the limited purpose of protecting Gunters workers compensation benefits, on the complexity of these proceedings and the severity of Mr. Gunters injury. The determination that these proceedings were too complex for Gunter to manage on account of his brain injury is supported by a significant amount of evidence establishing the severity of Gunters injury. Gunter himself establishes that his injury has left him unable to understand the C & R, stating that [a]ll I understand about [the] compensation rate is work me for life. I have not understood at all compensation rate. The superior court cannot be said to have committ[ed] clear error in accepting the evidence as clear and convincing proof of [Gunters] inability to manage his property and affairs effectively.25 Accordingly, the superior court did not abuse its discretion in appointing CAPA to protect Gunters workers compensation benefits.26 Therefore, Gunter does not present a colorable claim that the superior court erred by granting CAPA the authority to dismiss Gunters challenge to the C & R. 2. CAPA acted reasonably by dismissing Gunters claims attempting to overturn the C & R. The superior courts approval of CAPAs decision to dismiss Gunters claims also does not present a colorable claim of error because CAPAs decision was reasonable. After unsuccessfully attempting to secure representation for Gunter, CAPA stated in a report to the superior court that [t]he fact that no attorney seems interested in representing Mr. Gunter in this matter is evidence that this appeal may be unlikely to bring sufficient financial benefit to Mr. Gunter to justify the expense of pursuing it. If Mr. Gunter is successful in setting aside the compromise and release, he runs the risk that the ultimate decision could be the same or even less than he has been receiving under the settlement. For this appeal to benefit him, he must prevail in setting aside the agreement and then win substantially more. This result appears unlikely. CAPA appears to be correct that Gunter faced a very real threat that he would receive a lesser award if the C & R was overturned, as Kathy-O-Estates originally claimed that Gunter was entitled to compensation of only $74.99 per week, a claim that was probably correct. Kathy-O-Estates eventually agreed to the weekly compensation rate of $175 to $200 per week specified in the C & R. The reasonableness of CAPAs decision is supported by CAPAs inability to find a lawyer to represent Gunter on a contingency basis. CAPA was also correct in noting, as discussed above, that it was highly unlikely that Gunter would succeed in his novel attempt to gain compensation for the inheritance he believes he would have received but for his injury. We hold that CAPA acted reasonably in exercising its authority to dismiss Gunters challenge to the C & R. Therefore, we hold that Gunter does not have a colorable claim that the superior court erred by allowing the dismissal of his challenge to the C & R. V. CONCLUSION We hold that the board did not err in dismissing Gunters claims seeking reimbursement for the alleged financial consequences of his brain injury and that the superior court did not err by allowing CAPA to dismiss Gunters attempt to overturn the C & R. The decisions of the board and the superior court are accordingly AFFIRMED. _______________________________ 1 The Alaska Workers Compensation Board was added as a party, but declined to participate because it has no independent interest in this case. 2 Gunter v. Kathy-O-Estates, AWCB Decision No. 02-0054 (March 27, 2002). 3 The superior court also ordered the board not to accept any future claims, applications, or petitions by Gunter unless they were filed through Gunters counsel or guardian/conservator. Gunter has not challenged this ruling. 4 Dougan v. Aurora Elec. Inc., 50 P.3d 789, 793 (Alaska 2002). 5 Id. 6 Id. But cf. Palmer v. Municipality of Anchorage, Police & Fire Ret. Bd., 65 P.3d 832, 837 n.7 (Alaska 2003) (noting that [e]ven under the independent judgment standard we [g]ive some weight to what the agency has done, especially where the agency interpretation is longstanding. (quoting Usibelli Coal Mine, Inc. v. State, Dept of Natural Res., 921 P2d 1134, 1142-43 (Alaska 1996))). 7 Guin v. Ha, 591 P.2d 1281, 1284 n.6 (Alaska 1979). 8 See H.C.S. v. Cmty. Advocacy Project of Alaska, Inc., 42 P.3d 1093, 1096 (Alaska 2002). But see In re S.H., 987 P.2d 735, 738-41 (Alaska 1999) (applying clearly erroneous standard to determine whether it was appropriate to appoint conservator). 9 See In re S.H., 987 P.2d at 738-41. 10 Gunter also appears to seek reimbursement for the entire value of Kathy-O-Estates, which he contends he would have inherited but for his brain injury, stating that [b]ecause of this work accident I lost Kathy-O-Estates Inc. 4 million [dollars] & happy life. We decline to address this argument because the claim was not raised before the board or the superior court. See Reid v. Williams, 964 P.2d 453, 456 (Alaska 1998) (noting that we will not ordinarily consider issues unless they were raised in the trial court). 11 See Far N. Sanitation, Inc. v. Alaska Pub. Util. Commn, 825 P.2d 867, 871 n.5 & 873 (Alaska 1992) (holding that agency does not have powers beyond those which are authorized by legislative grant, express or implied). See also Blanas v. Brower Co., 938 P.2d 1056, 1061 (Alaska 1997) (quoting with approval idea 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) (quoting Greater Anchorage Area Borough v. City of Anchorage, 504 P.2d 1027, 1033 n.19 (Alaska 1972)). 12 AS 23.30. 13 See AS 23.30.005. 14 AS 23.30.045(a)-(b) (citing AS 23.30.041, which governs liability for rehabilitation, AS 23.30.050 and AS 23.30.095, which govern liability for medical costs, AS 23.30.145, which governs liability for legal costs, and AS 23.30.180-23.30.215, which govern liability for death and disability benefits). 15 The board has jurisdiction to grant permanent total disability benefits under AS 23.30.180, which provides that employees can only be compensated for their permanent total disabilities with a percentage of their weekly wages: [i]n case of total disability adjudged to be permanent 80 percent of the injured employees spendable weekly wages shall be paid to the employee during the continuance of the total disability. The method for calculating the employees spendable weekly wage is set out in AS 23.30.220(a), which provides in relevant part that [c]omputation of compensation under this chapter shall be on the basis of an employees spendable weekly wage at the time of injury. An employees spendable weekly wage is the employees gross weekly earnings minus payroll tax deductions. As these statutes make clear, the Alaska Workers Compensation Act attempts to replace an employees lost wage-based income. It does not provide an employee with benefits covering any future expenses that might conceivably have some relation to his or her injuries, such as those for which Gunter now seeks compensation. 16 Alaska Statute 23.30.055 provides in relevant part that [t]he liability of an employer prescribed in AS 23.30.055 is exclusive and in place of all other liability of the employer and any fellow employee to the employee. . . . However, if an employer fails to secure payment of compensation as required by this chapter, an injured employee or the employees legal representative in case death results from the injury may elect to claim compensation under this chapter, or to maintain an action against the employer in law or admiralty for damages on account of the injury or death. 17 Fenner v. Municipality of Anchorage, 53 P.3d 573, 575 (Alaska 2002). 18 Suh v. Pingo Corp., 736 P.2d 342, 344 (Alaska 1987). 19 Gunter v. Kathy-O-Estates, AWCB Decision No. 02-0054 (March 27, 2002). 20 A wards challenge to a guardians decision is analogous to an indigent defendants challenge to appointed counsels determination that the defendant does not have a colorable claim for post-conviction relief. See Alaska Rule of Criminal Procedure 35.1. In the event that an appointed attorney believes that his or her clients application for post-conviction relief is completely without merit, Rule 35.1(e)(2) provides that the attorney may: file with the court and serve on the prosecuting attorney . . . . (B) a certificate that counsel (i) does not have a conflict of interest; (ii) has completed a review of the facts and law in the underlying proceeding or action challenged in the application; (iii) has consulted with the applicant and, if appropriate, with trial counsel; and (iv) has determined that the application does not allege a colorable claim for relief. Rule 35.1(f)(2) provides that the appellate court must review a certificate filed under Rule 35.1(e)(2)(B) and permit counsel to withdraw and order the application dismissed if the applicant has no colorable claim for post-conviction relief or fails to respond to the certificate. 21 The procedural posture of this case is somewhat unusual. Only final judgments may be appealed. Here, the superior court remanded an administrative appeal to an agency for further proceedings. A remand order is not a final judgment. City and Borough of Juneau v. Thibodeau, 595 P.2d 626 (Alaska 1979). (Moreover, Gunter, who is pro se, did not appeal the boards dismissal of Gunters claims to the superior court.) But rather than dismiss Gunters appeal on the ground that the superior court remanded the case to the administrative agency, we treat it as a petition for review because Gunters injury poses a severe hardship in his efforts to navigate the court system. See Muncipality of Anchorage v. Anderson, 37 P.3d 420, 421 (Alaska 2001) (stating that we will treat an appeal improperly brought from a non-final order as a petition for review in order to prevent hardship and injustice (quoting Thibodeau, 595 P.2d at 631)). 22 In re S.H., 987 P.2d 735, 739 (Alaska 1999). Alaska Statute 13.26.280(c) requires that a conservator must be properly appointed and that the conservators actions must be reasonable in order to settle a lawsuit for his or her ward: [a] conservator, acting reasonably in efforts to accomplish the purpose for which the conservator was appointed, may act, without court authorization or confirmation, to . . . . (19) pay or contest any claim; to settle a claim by or against the estate or the protected person by compromise, arbitration, or otherwise; and to release, in whole or in part, any claim belonging to the estate to the extent that the claim is uncollectible. 23 AS 13.26.150(b). 24 The court must appoint a visitor to investigate the prospective wards incapacity and evaluate whether the prospective ward needs a guardian. AS 13.26.106(c); AS 13.26.108. 25 In re S.H., 987 P.2d at 741. 26 See H.C.S. v. Cmty. Advocacy Project of Alaska, Inc., 42 P.3d 1093, 1096 (Alaska 2002).