Baker v. Endeavor Servs. ( 2018 )

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integrity of this document
New Mexico Compilation
Commission, Santa Fe, NM
'00'04- 12:00:46 2018.10.17
IN THE SUPREME COURT OF THE STATE OF NEW MEXICO
Opinion Number: 2018-NMSC-035Filing Date: September 6, 2018
Docket No. S-1-SC-36651
CASEY R. BAKER,
Worker-Petitioner,
v.
ENDEAVOR SERVICES, INC. and
GREAT WEST CASUALTY COMPANY,
Employer/Insurer-Respondents.
ORIGINAL PROCEEDING ON CERTIORARI
Terry S. Kramer, Workers’ Compensation Judge
Gerald A. Hanrahan
Albuquerque, NM
for Petitioner
Kelly A. Genova, P.C.
Kelly A. Genova
Albuquerque, NM
for Respondents
OPINION
CLINGMAN, Justice.
{1} Casey R. Baker (Worker) appeals the decision by the Workers’ Compensation
Administration denying his request that Endeavor Services, Inc. and Great West Casualty
Company (Employer) pay 100% of Worker’s attorney fees pursuant to the fee-shifting
provision set forth in NMSA 1978, Section 52-1-54(F)(4) (2003, amended 2013). At issue
is whether Worker made an offer of judgment that was sufficient to trigger the fee-shifting
provision. Worker’s offer of judgment put Employer on notice that Worker was proposing
an unambiguous partial settlement and that Worker intended to invoke the fee-shifting
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statute. We conclude that Worker made a valid offer under Section 52-1-54(F) (2003) and
hold that the workers’ compensation judge erred as a matter of law by declining to apply the
mandatory fee-shifting provision. We therefore reverse and remand.
I. DEFICIENCIES IN THE RECORD PROPER
{2} It is the duty of this Court to decide the cases before it if the factual record is
sufficient to do so. The record proper before this Court is lacking in a number of ways.
However, requiring a perfect record would mean this Court would rarely decide any cases.
The parties in this case do not dispute the factual findings of the workers’ compensation
judge, but rather the parties dispute the judge’s application of the law to the facts.
Unchallenged findings of fact are binding on this Court. State ex rel. State Highway Comm’n
v. Sherman, 1971-NMSC-009, ¶¶ 2-3, 82 N.M. 316, 481 P.2d 104; State ex rel. Thornton v.
Hesselden Construction Co., 1969-NMSC-036 ¶ 4, 80 N.M. 121, 452 P.2d 190 (“[F]ailing
to challenge any one of the trial court’s findings . . . , [a party] is bound by the findings.”);
Gallegos v. Kennedy, 1968-NMSC-170, ¶ 6, 79 N.M. 590, 446 P.2d 642 (“Unchallenged
findings are the facts upon which the case rests on appeal and are binding on this court.”).
“Unless findings are directly attacked, they are the facts in this court, and a party claiming
error on the part of the trial court must be able to point clearly to the alleged error.”
Sherman, 1971-NMSC-009, ¶¶ 2-3 (citing Morris v. Merchant, 1967-NMSC-026, ¶ 21, 77
N.M. 411, 423 P.2d 606). Nowhere in the brief in chief, answer brief, or reply brief do the
parties challenge the legitimacy of the facts presented. Instead, the parties dispute the
analysis by the workers’ compensation judge of the offer of judgment and the judge’s
application of Section 52-1-54(F)(4) (2003) to the offer. We conclude that sufficient factual
certainty exists in the record before us to decide this case.
II. BACKGROUND
{3} Worker suffered injuries as a result of a compensable motor vehicle accident on
October 14, 2011. On January 9, 2012, Worker filed his first workers’ compensation
complaint, seeking medical benefits, temporary total disability (TTD) benefits, and attorney
fees. The parties participated in a mediation conference on February 17, 2012, and both
parties accepted the mediator’s recommended resolution of Worker’s first complaint.
However, a number of issues remained unresolved, including the total amount of Worker’s
medical expenses, Worker’s preinjury weekly wage, and the compensation rate to which
Worker was entitled. These issues remained unresolved until December 21, 2016, following
a trial on the merits.
{4} On July 22, 2013, Dr. Balkman assessed Worker to determine whether he had
reached his maximum medical improvement (MMI). See NMSA 1978, § 52-1-24.1 (1990)
(“As used in the Workers’ Compensation Act, ‘date of maximum medical improvement’
means the date after which further recovery from or lasting improvement to an injury can no
longer be reasonably anticipated based upon reasonable medical probability as determined
by a health care provider.”). Once a medical care provider, like Dr. Balkman, finds a worker
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to be at MMI, the healing process is deemed complete, see id., and the worker’s permanent
physical impairment can be assessed. See NMSA 1978, § 52-1-26 (1990, amended 2017);
Smith v. Cutler Repaving, 1999-NMCA-030, ¶ 10, 126 N.M. 725, 974 P.2d 1182 (“Key to
determining MMI is ‘expert medical testimony’ regarding whether the injured worker ‘is
more likely than not’ to recover further.” (citation omitted)). A medical care provider
quantifies the worker’s permanent impairment into a percentage and, from that percentage,
the worker’s permanent partial disability (PPD) is calculated. See NMSA 1978, § 52-1-26.1
(1990); NMSA 1978, § 52-1-26.4(D) (2003). Dr. Balkman found Worker to be at MMI with
an associated whole person impairment (WPI) rating of only 5%.
{5} Employer accepted these findings and immediately began paying benefits in
accordance with the July 22, 2013, MMI date and the 5% WPI rating. Dr. Balkman’s
findings had the effect of limiting Worker’s available compensation, paid via PPD, to
significantly less than what Worker believed he was entitled to. Worker contested Dr.
Balkman’s findings, arguing that he had not reached MMI and was entitled to continued
payment of TTD benefits, rather than PPD benefits. Ultimately Worker argued that he had
not reached MMI on July 22, 2013, counter to Dr. Balkman’s findings, and in the future
when he did reach MMI, he would be entitled to a WPI rating of 37%. Dr. Balkman later
amended her findings on May 19, 2014, and determined Worker to have a WPI of 13% but
did not change the date of MMI nor agree with Worker’s assertion that his injuries warranted
a 37% WPI rating.
{6} On June 24, 2014, Worker was involved in a second motor vehicle accident, a rear
end collision, when he was driving from his home to Dr. Balkman’s office to be treated for
the injuries stemming from his October 14, 2011, accident. Following the second accident,
Worker filed a second workers’ compensation complaint concerning many of the issues that
remained unresolved from the first complaint. A second mediation occurred on September
4, 2014. Employer rejected the mediator’s recommendations. The parties continued to
litigate the implications of the second accident, the date of MMI, Worker’s WPI, and the
compensation to which Worker was entitled.
{7} On June 18, 2015, Employer changed Worker’s treating physician to Dr. Reeve.
Employer did not authorize Dr. Reeve to provide a second impairment assessment, reasoning
that Dr. Balkman’s assessment was sufficient.
{8} On November 11, 2015, Worker served Employer with an offer of judgment. In the
offer of judgment, Worker included four relevant terms to settle the case:1
[1] . . . Worker’s weekly payment rate shall be $629.11 . . . .
1
Although Worker failed to include the offer of judgment in the record before this
Court, Employer does not dispute that Worker’s brief in chief accurately sets forth the terms
of the offer.
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[2] Worker’s work-related injuries and conditions have not reached
[MMI].
[3] Pursuant to [NMSA 1978,] § 52-1-25.1 [(2005), amended 2017)],
Worker is entitled to [TTD] benefits from October 14, 2011, and
continuing until MMI is reached in the future for all work-related
injuries and conditions.
[4] Employer . . . shall forthwith issue payment of arrears to bring
Worker’s TTD benefits current at the rate of $629.11 per week, less
$100.00. [Employer is] entitled to a credit for all indemnity payments
made to date to Worker, plus $100.00.
Additionally, Worker offered to split his attorney fees equally with Employer. Thereafter,
the workers’ compensation judge scheduled a settlement conference for February 1, 2016.
Employer rejected Worker’s offer of judgment.
{9} The parties failed to reach a settlement and proceeded to trial on December 14, 2016.
About a week before trial, Worker’s attorney paid the $3,219.48 cost of a second impairment
assessment by Dr. Reeve. Contrary to Dr. Balkman’s findings, Dr. Reeve found that Worker
reached MMI on December 7, 2016, and had a WPI rating of 37%. Also prior to trial the
parties stipulated that Worker’s TTD compensation rate was $629.11 per week. At the end
of the trial, the workers’ compensation judge issued a compensation order that included the
following findings and conclusions:
[1] Worker reached [MMI] on December 7, 2016.
[2] Worker has a combined thirty-seven percent (37%) impairment as a
result of his work injuries.
....
[3] The [second] motor vehicle accident was as a result of the work
accident and is part of the compensable claim.
....
[4] Worker’s compensation rate is $629.11.
[5] Worker is entitled to [TTD] benefits from date of accident to
December 7, 2016.
[6] Worker is entitled to [PPD] benefits at eighty-five percent (85%)
commencing December 8, 2016 and continuing until conclusion of
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the benefit period unless otherwise ordered.
....
[7] Employer is responsible for the $3,219.48 charge from Dr. Reeve for
preparation of his final report.
[8] Worker’s attorney is entitled to a reasonable fee to be set forth under
separate order.
{10} Following trial, Worker filed an application for attorney fees and asked the workers’
compensation judge to order Employer to pay 100% of Worker’s attorney fees under Section
52-1-54(F)(4) (2003). The workers’ compensation judge awarded Worker $42,925 in
attorney fees and ordered each party to pay 50% of those fees. The workers’ compensation
judge declined to order Employer to pay 100% of Worker’s attorney fees because “Worker’s
Offer of Judgment failed to address material facts and issues in dispute and determined at
trial.”
{11} Both parties appealed to the Court of Appeals. Employer contended that the workers’
compensation judge erred by awarding benefits based on an MMI date of December 7, 2016.
See Baker v. Endeavor Servs., Inc., A-1-CA-36142 and A-1-CA-36272, mem. op. ¶ 1 (Aug.
8, 2017) (nonprecedential). Worker filed a cross-appeal, arguing that the workers’
compensation judge erred by failing to order Employer to pay 100% of Worker’s attorney
fees. Id. ¶¶ 1-2. The Court of Appeals affirmed the compensation order, including the finding
that Worker reached MMI on December 7, 2016. Id. ¶ 1. The Court of Appeals also affirmed
the order requiring each party to pay 50% of Worker’s attorney fees, concluding that
Worker’s offer of judgment left unaddressed PPD benefits, medical benefits, “or any other
benefits, aside from attorney fees, that were contested issues and which worker was
ultimately awarded.” Id. ¶¶ 1-2. The Court of Appeals held that Worker’s “offer did not
supply an appropriate basis for application of the fee-shifting provision.” Id. ¶ 3.
{12} Worker filed a petition for writ of certiorari, asking this Court to review (1) whether
the workers’ compensation judge erred by not ordering Employer to pay 100% of Worker’s
attorney fees, and (2) whether the Court of Appeals opinion affirming the workers’
compensation judge conflicted with Section 52-1-54(F)(4) (2003) and Abeyta v. Bumper to
Bumper Auto Salvage, 2005-NMCA-087, 137 N.M. 800, 115 P.3d 816. We granted certiorari
to review the workers’ compensation judge’s application of the fee-shifting provision in
Section 52-1-54(F)(4) (2003) to Worker’s offer of judgment.
III. DISCUSSION
{13} Employer relies on Leonard v. Payday Professional, 2007-NMCA-128, ¶ 23, 142
N.M. 605, 168 P.3d 177, to argue that Worker’s offer was not a valid offer of judgment
under Section 52-1-54(F) (2003) because the offer failed to address two contested issues.
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Specifically, Employer asserts that Worker’s offer of judgment did not establish either the
date on which Worker reached MMI or the PPD benefit Worker was entitled to, issues that
were in dispute at the time Worker made his offer. Employer notes that before Worker made
his offer of judgment, Dr. Balkman had found Worker to be at MMI and assigned Worker
a WPI rating. Employer does not dispute the amount of attorney fees awarded but argues that
the fee-shifting provision in Section 52-1-54(F)(4) (2003) should not apply because
accepting Worker’s offer could not have ended the litigation in this case.
{14} Conversely, Worker argues that his offer of judgment was valid and that it was not
necessary to specify the date of MMI or the PPD benefit. Worker explains that Dr.
Balkman’s determination of MMI, on which Employer relies, was erroneous and that Worker
had not yet reached MMI at the time the offer was made. He further contends that MMI need
not be established as a prerequisite to a valid offer. In support of his argument, Worker relies
on Abeyta, 2005-NMCA-087, ¶ 13, to illustrate that an offer of judgment may be valid even
if the offer is made before a worker has reached MMI.
A. Standard of Review
{15} In this case, the parties do not dispute the factual findings of the workers’
compensation judge, so we need only to review the application of Section 52-1-54(F)(4)
(2003) to the facts. When we review a workers’ compensation judge’s interpretation of
statutory requirements and the application of the law to the facts, we apply a de novo
standard of review. Dewitt v. Rent-A-Center, Inc., 2009-NMSC-032, ¶ 14, 146 N.M. 453,
212 P.3d 341. “We look first to the plain meaning of the statute’s words, and we construe
the provisions of the [Workers’ Compensation] Act together to produce a harmonious
whole.” Id. (internal quotation marks and citation omitted). “Our main goal in statutory
construction is to give effect to the intent of the legislature.” Grine v. Peabody Nat. Res.,
2006-NMSC-031, ¶ 17, 140 N.M. 30, 139 P.3d 190 (internal quotation marks and citation
omitted).
B. The Purpose of Section 52-1-54(F) (2003) Is to Encourage Prompt Settlement
of Workers’ Compensation Disputes
{16} The purpose of the Workers’ Compensation Act, NMSA 1978, §§ 52-1-1 to -70
(1929, as amended through 2017), is to expeditiously and efficiently compensate injured
workers while also being fair to employers. See NMSA 1978, § 52-5-1 (1990) (stating that
the intent of the legislation is the “quick and efficient delivery of indemnity and medical
benefits . . . at a reasonable cost to employers”). To aid in expeditiously disposing of claims,
a mediator “evaluates all initial complaints.” See 11.4.4.10(A) NMAC. Following a
mediation conference, the mediator issues a recommended resolution of disputed issues. See
11.4.4.10(C)-(D) NMAC. If either party rejects the recommended resolution, then the
employer or worker may serve on the opposing party an offer of judgment in accordance
with Section 52-1-54(F) (2003). The pertinent portion of Section 52-1-54(F) (2003) reads,
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After a recommended resolution has been issued and rejected, but
more than ten days before a trial begins, the employer or claimant may serve
upon the opposing party an offer to allow a compensation order to be taken
against [the employer or claimant] for the money or property or to the effect
specified in [the] offer, with costs then accrued . . . .
{17} An offer of judgment is essentially an offer to stipulate to the issuance of a formal
compensation order. See § 52-1-54(F) (2003); see also Rivera v. Flint Energy, 2011-NMCA-
119, ¶¶ 2-3, 9, 268 P.3d 525 (discussing the formal entry of a compensation order following
the employer’s rejection of an offer of judgment and after a trial of the worker’s claims). In
an effort to promote settlement and avoid lengthy litigation, Section 52-1-54(F)(4) (2003)
encourages making and accepting reasonable offers of judgment by imposing financial
sanctions on a party who rejects an offer of judgment and does not obtain a more favorable
ruling in the compensation order. See Hise v. City of Albuquerque, 2003-NMCA-015, ¶ 9,
133 N.M. 133, 61 P.3d 842; Leo v. Cornucopia Rest., 1994-NMCA-099, ¶ 28, 118 N.M. 354,
881 P.2d 714. Section 52-1-54(F)(4) (2003) states specifically,
[I]f the worker’s offer was less than the amount awarded by the
compensation order, the employer shall pay one hundred percent [100%] of
the attorney fees to be paid the worker’s attorney, and the worker shall be
relieved from any responsibility for paying any portion of the worker’s
attorney fees.
C. Worker’s Offer of Judgment Was Valid
{18} Three requirements must be met for a worker’s offer of judgment to trigger the fee-
shifting provision pursuant to Section 52-1-54(F)(4) (2003). See Rivera, 2011-NMCA-119,
¶ 3. To force the employer to pay 100% of the attorney fees, an offer of judgment must be
(1) a valid offer under Section 52-1-54(F) (2003), (2) for an amount less than the award at
trial, and (3) an offer which the employer rejected. Id. In this case, the parties dispute only
whether Worker satisfied the first requirement by making a valid offer under Section 52-1-
54(F) (2003). Employer does not dispute that Worker offered to accept less than he was
subsequently awarded at trial or that Employer rejected Worker’s offer.
{19} In Rivera, the Court of Appeals held that a worker’s offer of judgment was not a
valid offer for the purposes of Section 52-1-54(F) (2003) because it failed to provide the
employer with notice that the offer was intended to trigger the fee-shifting provision of
Section 52-1-54(F) (2003). Rivera, 2011-NMCA-119, ¶ 6. Rivera observed that this notice
requirement stems from basic contract principles. Id. ¶ 8 (citing Naranjo v. Paull,
1990-NMCA-111, ¶¶ 14-15, 111 N.M. 165, 803 P.2d 254). “In the law of contracts an offer
is a proposal setting forth the essential terms of the prospective transaction.” Naranjo, 1990-
NMCA-111, ¶ 14. Thus, “[t]he notion that a choice, to be legally binding, should be a
‘knowing’ choice is well-established in similar situations.” Id. ¶ 15. Rivera concluded that
these contract principles extend to an offer of judgment under Section 52-1-54(F)(4) (2003).
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Rivera, 2011-NMCA-119, ¶¶ 8-9.
{20} For an offer of judgment to be legally binding it must set forth language making clear
the intent of the offeror and implications of acceptance by the opposing party. See id. ¶ 9.
In this case, the offer of judgment made clear that Worker was “allow[ing] a compensation
order to be taken” if Employer accepted the terms of the offer. Section 52-1-54(F) (2003);
see Rivera, 2011-NMCA-119, ¶ 10 (holding a worker’s offer invalid under Section 52-1-
54(F) (2003) for failing to “put Employer on notice that the offer was one to allow a
compensation order to be taken against Employer”). Worker specifically mentioned that
attorney fees would be split equally if the offer was accepted. Unlike Rivera, 2011-NMCA-
119, ¶ 9, there was no question whether Worker proposed an offer of judgment or merely an
offer of settlement because the language “offer of judgment” was used in Worker’s
certificate of service. This language put Employer on notice that the offer was intended to
trigger the fee-shifting provision of Section 52-1-54(F) (2003); therefore, the offer was not
ambiguous in that regard.
{21} Just as the offer of judgment must put the opposing party on notice of its
implications, to be valid the offer must also address the critical issues raised in the
complaint. Leonard, 2007-NMCA-128, ¶¶ 23, 25-26. If an offer of judgment does not
dispose of the critical issues raised in a worker’s compensation complaint, the offer is
ambiguous and therefore invalid. Id. The offer must, at a minimum, provide a “frame of
reference regarding the [opposing party’s] liability.” Id. ¶¶ 23, 25. The opposing party
should be able to discern what its liability will be in order to make an informed decision to
accept or reject the offer. Id. The terms of the offer of judgment must also allow the workers’
compensation judge to ascertain whether the offeror received a more or less favorable
outcome in the final compensation order compared to what was offered in the offer of
judgment. Id. ¶ 25.
{22} The Court of Appeals in Leonard found critical issues to be absent from the offer of
judgment and concluded that the offer “was fatally defective.” Id. Leonard was concerned
with apportioning liability for a worker’s injury between two employers. Id. ¶¶ 1, 5. The
worker in Leonard presented an offer that did not address either employer’s liability relative
to the other employer. Id. ¶ 26. Therefore, the employers lacked any frame of reference as
to what their respective liabilities would be if they were to accept the offer. Id. ¶ 25.
Moreover, because the offer in Leonard was silent regarding the apportionment of liability,
the workers’ compensation judge was unable to determine whether the final compensation
order provided a more or less favorable outcome to the worker. Id. Without answering that
critical question, the offer was too ambiguous to be valid. Id. ¶ 26.
{23} Here, although Employer points to uncertainty about the date of MMI and the rate
of PPD as sufficient to invalidate the offer of judgment, these are not critical issues if the
worker’s healing process is incomplete. See Abeyta, 2005-NMCA-087, ¶ 10 (“[T]here is no
basis for setting an MMI date if the healing process is still continuing.”). The absence of an
MMI date does not preclude an opposing party from ascertaining its potential liability set
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out in an offer of judgment. See id. ¶¶ 10-11. This reasoning of the Court of Appeals in
Abeyta is consistent with the statutory provision that no permanent physical impairment or
WPI can be deduced until the worker has completed the healing process because, until MMI
is reached, no PPD benefits can be determined. See § 52-1-26(D) (1990). Further, to force
a worker or employer to include details in an offer of judgment that are dependent on the
healing process of the worker would drastically delay settlements in compensation cases. See
Abeyta, 2005-NMCA-087, ¶ 13 (stating that authorizing only those settlements where offers
of judgment are delayed until completion of the healing process would “undercut” the intent
and purpose of the Workers’ Compensation Act). Unlike the offer of judgment in Leonard,
the offer of judgment in Abeyta was unambiguous because the employer’s liability was “not
susceptible to more than one interpretation” despite the absence of an MMI date. Abeyta,
2005-NMCA-087, ¶¶ 11-13.
{24} In this case, Worker set forth his proposed resolution of MMI and PPD in the offer
of judgment which states, “Pursuant to § 52-1-25.1 [(2005)], Worker is entitled to [TTD]
benefits from October 14, 2011 [date of injury], and continuing until MMI is reached in the
future for all work-related injuries and conditions.” Employer argues this language rendered
the offer of judgment fatally ambiguous because the MMI date was not set at the time of
Worker’s offer. However, the language in Worker’s offer of judgment was nearly identical
to the language used by the worker in Abeyta. The worker in Abeyta offered to accept “TTD
benefits paid for the time period from the date of injury until . . . [MMI] as determined by
[the treating physician].” Abeyta, 2005-NMCA-087, ¶ 3 (omission in original) (internal
quotation marks omitted). We recognize, as did the Court of Appeals in Abeyta, that the
absence of an established MMI date presents a degree of risk to the employer. See id. ¶ 11.
However, risk posed by an offer is different from ambiguity. The offers of judgment at issue
in Abeyta and in this case are not susceptible to more than one interpretation. See id. ¶¶ 10-
11. The Court of Appeals in Abeyta analyzed the language of the offer of judgment and
found that, although lacking specific details, the employer understood the implications of the
offer and understood the worker’s intent in offering it but “found [the offer] too risky to
undertake.” Id. ¶¶ 10-12. Moreover, the workers’ compensation judge in Abeyta was able
to subsequently ascertain that the amount proposed in the worker’s offer of judgment was
less than what was awarded in the final compensation order. See id. ¶ 1. We reach the same
conclusion as did the Court of Appeals in Abeyta. See id. ¶¶ 14-16.
{25} By November 11, 2015, when Worker filed the offer of judgment, Employer in
anticipation of the potential for fee-shifting under Section 52-1-54(F)(4) (2003) could have
filed an offer of judgment of its own. This would have exposed Worker to the same risk of
fee-shifting as that to which Employer was then exposed. See § 52-1-54(F)(3) (2003). Or
Employer could have entered into a partial settlement with Worker, effectively limiting its
liability by constraining the issues to be litigated. Instead Employer took no action and stood
by the July 22, 2013, MMI assessment which Worker found unreasonable. Although MMI
was not yet determined and the PPD benefits and WPI rating remained unknown at the time
of Worker’s offer of judgment, the framework of what Worker offered was clear, and
Employer was well informed as to the scope of its liability. Worker’s offer was
9
unambiguous.
{26} An argument premised on an employer’s dislike of the offer of judgment is not
enough to render the offer defective. An offer of judgment is like any other offer to enter into
a contract. If one side does not like the terms of the contract or does not agree with the other
side’s assertions, no contract need be formed. But in order “to encourage settlement of
compensation cases by authorizing both parties to make offers of judgment,” the Workers’
Compensation Act requires the imposition of sanctions on partieswho are unwilling to settle
on reasonable terms. See Abeyta, 2005 NMCA-087, ¶ 13 (quoting Leo, 1994-NMCA-099,
¶ 28 (internal quotation marks omitted)).
{27} Employer also argues that Worker’s offer of judgment is invalid because Employer’s
acceptance of the offer would not have ended the litigation. We do not read Section 52-1-
54(F)(4) (2003) as requiring a worker’s offer of judgment to propose the settlement of all
issues in order to shift all attorney fees to the employer, nor would an employer’s offer of
judgment need to propose the settlement of all issues in order to shift all attorney fees to the
worker under Section 52-1-54(F)(3) (2003). As we discussed previously, as long as the offer
of judgment provides a sufficient frame of reference concerning contested issues, questions
raised in the complaint may be left unresolved. See Leonard, 2007-NMCA-128, ¶¶ 25-26.
In workers’ compensation cases, the possibility of litigation continues until the worker is
both healed and fully compensated. Until that time, disputes regarding the worker’s medical
bills, compensation rate, disability rating, or any number of other issues may arise. The
purpose of an offer of judgment is to incentivize resolution of the complaint, but the offer’s
validity does not rest on all issues related to the worker’s injury being immediately and
completely resolved.
{28} We conclude, based on the plain language and stated purpose of the Workers’
Compensation Act and the collective reasoning of Abeyta, Leonard, and Rivera, that Worker
made a valid offer of judgment, sufficient to trigger the fee-shifting provision set forth in
Section 52-1-54(F)(4) (2003).
D. Fee-Shifting Is Mandatory If the Requirements of Section 52-1-54(F) (2003) Are
Met
{29} Employer relies on Abeyta, 2005-NMCA-087, ¶ 20, to contend that, even if Worker’s
offer was valid under Section 52-1-54(F) (2003), the workers’ compensation judge had
discretion to award Worker only 50% of his attorney fees. Worker argues that the workers’
compensation judge must apply the statute’s fee-shifting provision if the requirements of
Section 52-1-54(F) (2003) are met. Worker, therefore, asserts that the workers’
compensation judge erred as a matter of law by declining to order Employer to pay 100%
of Worker’s attorney fees. We agree with Worker.
{30} The plain language of the statute is clear and unambiguous and requires attorney fees
to be shifted to the rejecting party if the final compensation awarded to the offeror exceeds
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what was initially offered. See § 52-1-54(F)(3)-(4) (2003). This type of sanction is consistent
with the intent of the statute, which incentivizes settlements in compensation cases. See Hise,
2003-NMCA-015, ¶ 9. We review for abuse of discretion the factual findings underlying the
judge’s compensation order that determined whether to impose statutory fee-shifting. See
Abeyta, 2005-NMCA-087, ¶¶ 9, 20 (noting that “an abuse of discretion can include a
discretionary decision that is premised on a misapplication of the law”). If the findings meet
the requirements of Section 52-1-54(F) (2003), then fee-shifting is mandatory. See id.¶¶ 19-
20. In Abeyta, there was a close factual question regarding whether the amount the worker
proposed in the offer of judgment was less than the amount awarded in the final
compensation order—a prerequisite to fee-shifting. Id. ¶ 20. The workers’ compensation
judge in Abeyta used sound discretion to determine that factual question in the worker’s
favor. Id. ¶¶ 14-16. It was not an abuse of discretion for the workers’ compensation judge
to find that the amount awarded in the compensation order exceeded the amount proposed
in the offer of judgment. Id. ¶¶ 14-15.
{31} After rejecting Worker’s offer of judgment, Employer incurred additional liability
for costs not included in the offer of judgment. Comparing findings and conclusions from
the December 21, 2016, compensation order to portions of the November 20, 2015, offer of
judgment provides a basis for the workers’ compensation judge to find that Worker’s
benefits received through the compensation order exceeded those he would have obtained
under the offer of judgment. Such a finding is a prerequisite to fee-shifting.
{32} The workers’ compensation judge erroneously declined to apply the fee-shifting
statute because the judge concluded that Worker’s offer of judgment “failed to address
material facts and issues in dispute.” But as we explained in the previous section, an offer
of judgment need not establish the date of MMI or amount of PPD benefits if the healing
process is still underway. We conclude that the workers’ compensation judge erred as a
matter of law by declining to apply the fee-shifting provision, Section 52-1-54(F)(4) (2003),
where Worker’s offer of judgment met all of the requirements to trigger fee-shifting under
the statute. We therefore hold that the workers’ compensation judge erred by failing to award
Worker 100% of his attorney fees.
IV. CONCLUSION
{33} We reverse and remand to the Workers’ Compensation Administration for further
proceedings consistent with this opinion.
{34} IT IS SO ORDERED.
____________________________________
GARY L. CLINGMAN, Justice
WE CONCUR:
11
___________________________________
PETRA JIMENEZ MAES, Justice
___________________________________
CHARLES W. DANIELS, Justice
___________________________________
BARBARA J. VIGIL, Justice
NAKAMURA, Chief Justice (dissenting).
NAKAMURA, Chief Justice (dissenting).
{35} Worker failed to offer terms resolving all of the disputed matters necessary to
determine whether his settlement offer was less than the compensation awarded.
Accordingly, Worker is not entitled to fee shifting. Both the Workers’ Compensation Judge
(WCJ) and Court of Appeals were correct and should be affirmed. For these reasons, I
dissent.
{36} “New Mexico has traditionally followed the American Rule by which each litigant
is ordinarily responsible for its own attorney’s fees.” Carrillo v. Compusys, Inc.,
2002-NMCA-099, ¶ 10, 132 N.M. 710, 54 P.3d 551. Nevertheless, “it is well settled that the
[L]egislature may override the American Rule by enacting a fee-shifting statute.” Id.Section 52-1-54(F)(4) is an example of just such a statute. Id.{37} “As a general rule, statutes in derogation of the common law are to be strictly
construed.” Albuquerque Hilton Inn v. Haley, 1977-NMSC-051, ¶ 7, 90 N.M. 510, 565 P.2d
1027. What is the consequence of this proposition for our assessment of Section 52-1-
54(F)(4)? The “purpose” provision of the Workers’ Compensation Act (WCA) bears on this
question. It states that
[i]t is the specific intent of the [L]egislature that benefit claims cases be
decided on their merits and that the common law rule of ‘liberal construction’
based on the supposed ‘remedial’ basis of workers’ benefits legislation shall
not apply in these cases. The workers’ benefit system in New Mexico is
based on a mutual renunciation of common law rights and defenses by
employers and employees alike. Accordingly, the [L]egislature declares that
the [WCA] . . . [is] not remedial in any sense and [is] not to be given a broad
liberal construction in favor of the claimant or employee on the one hand, nor
are the rights and interests of the employer to be favored over those of the
employee on the other hand.
Section 52-5-1. This provision was enacted to provide our courts with guidance when asked
to interpret the WCA. Garcia v. Mt. Taylor Millwork, Inc., 1989-NMCA-100, ¶¶ 9-10, 111
12
N.M. 17, 801 P.2d 87. “Section 52-5-1 calls for a balanced and evenhanded construction of
the [WCA].” Gomez v. B.E. Harvey Gin Corp., 1990-NMSC-057, ¶ 9, 110 N.M. 100, 792
P.2d 1143. This conclusion stems, in part, from the fact that “[f]undamental fairness to both
the workers and employers has long been a guideline.” Garcia, 1989-NMCA-100, ¶ 11.
{38} What conclusions can we draw from these authorities? It seems clear that, as a
general matter, we must favor neither workers nor employers when construing the WCA.
In this specific case, we must consider the text of Section 52-1-54(F)(4) in a neutral and
disinterested way and construe the provision in a manner that best advances the purposes and
policies it was enacted to advance.
{39} Section 52-1-54(F)(4) exists “to encourage the parties to resolve their differences
before hearing thus supporting the policy of judicial economy and allowing for more timely
resolution of claims.” Meyers v. W. Auto, 2002-NMCA-089, ¶ 25, 132 N.M. 675, 54 P.3d
79. It is designed to “require[] the parties to think very hard about whether continued
litigation is worthwhile.” Baber v. Desert Sun Motors, 2007-NMCA-098, ¶ 18, 142 N.M.
319, 164 P.3d 1018 (internal quotation marks and citation omitted).
{40} The Court of Appeals has embraced a pragmatic approach to resolve whether fee
shifting shall be imposed: “The compensation order is . . . compared to the offer of judgment
in order to determine whether attorney fees should be shifted.” Id. ¶ 17. This comparison
is exceedingly straightforward; the question is simply “Did the worker ultimately get more
than he asked for?” Meyers, 2002-NMCA-089, ¶ 26. Despite the rudimentary nature of this
analysis, complex questions regarding the applicability of the provision have arisen.
{41} In Rivera, the WCJ declined to apply the fee-shifting provision despite the fact that
the worker’s offer of settlement was less than the award he ultimately received.
2011-NMCA-119, ¶ 3. The WCJ determined that the letter submitted by the worker as the
offer “did not provide sufficient specificity or adhere sufficiently to the statute to trigger the
statute’s fee-shifting provisions.” Id. (internal quotation marks omitted). Specifically, the
letter “did not mention the statute or state that the offer it contained was valid only for the
ten-day period the statute requires.” Id. ¶ 9. Further, it “did not refer to the statute’s
fee-shifting provision.” Id. It also “did not state that accepting the offer would require [the
e]mployer to have a compensation order entered against it.” Id.
{42} For these reasons, the Court of Appeals concluded “that the [worker’s] offer did not
set forth any language that can support the type of agreement [the w]orker claims he
intended” and further concluded that “[s]uch an omission makes the offer ambiguous as to
whether [the w]orker proposed an offer of settlement or an offer of judgment.” Id. The
Court rightly speculated that the employer “could reasonably have concluded that accepting
[the w]orker’s offer to ‘settle’ the case would result in the simple dismissal of the action
before the [WCA], rather than the formal entry of an order that the statute requires.” Id. The
Court held that these flaws were “fatal” and rendered the offer “incomplete” and “a nullity.”
Id. (internal quotation marks and citation omitted). Rivera was rightly decided but has no
13
bearing on Worker’s appeal.
{43} We are not concerned here with whether Worker’s November 11, 2015 offer was a
communication constituting an “offer” for purposes of Section 52-1-54(F)(4). The parties
accept that Worker did convey an offer to Employer and that this offer did trigger Section
52-1-54(F)(4). The question before us is simply whether the WCJ correctly concluded that
the fee-shifting provision should not apply. To answer that question, we must resolve
whether Worker’s offer was less than what Worker ultimately received from the WCJ’s
compensation award. The parties’ positions as to this issue are clear. Worker contends that
“the benefits [he] obtained from the compensation order . . . exceeded the benefits that
Worker offered to accept . . . .” Employer counters that “the offer could not actually be
evaluated in terms of dollar value” as “Worker’s offer of judgment did not address the issues
in the case, including MMI and disability rating.”
{44} Employer’s argument is correct. The basis for this conclusion is explained in the
writing that follows. Here, it is necessary to emphasize that the majority’s erroneous
resolution of this case appears to be rooted in its belief that the sole issue before us is
whether Worker’s offer was “valid.” See Maj. Op. ¶ 18 (citing Rivera for the proposition
that fee shifting under Section 52-1-54(F)(4) shall apply where (1) a valid offer is conveyed;
(2) that is less than the ultimate award; and (3) which the employer rejected, and further
stating that, “[i]n this case, the parties dispute only whether Worker satisfied the first
requirement by making a valid offer under Section 52-1-54(F) (2003)”). According to the
majority, the validity of any offer is a question that is intertwined with the question of
whether that offer is “ambiguous.” See Maj. Op. ¶ 21 (citing Leonard for the proposition
that an offer, to be valid, “must also address the critical issues raised in the complaint” and
further stating that, “[i]f an offer of judgment does not dispose of the critical issues raised
in a worker’s compensation complaint, the offer is ambiguous and therefore invalid.”). The
consequence of this analytical framework is that the question of whether an offer is valid or
ambiguous becomes a matter entirely distinct from the question of whether an offer is
comparatively less valuable than the award. This is error.
{45} Employer’s argument here is that the terms of Worker’s offer were uncertain or
incomplete and, therefore, the value of his offer could not and cannot be measured against
the award to decide if fee shifting under Section 52-1-54(F)(4) is appropriate. To put it more
simply: the value of Worker’s offer is indiscernible and, therefore, cannot be compared to
the award and fee shifting cannot be imposed. The assertion that “Employer does not
dispute that Worker offered to accept less than he was subsequently awarded at trial[,]” Maj.
Op. ¶ 18, is simply incorrect. Employer does dispute this fact. Additionally, the majority
relies on Abeyta for the proposition that “[t]he absence of an MMI date does not preclude
an opposing party from ascertaining its potential liability set out in an offer of judgment[,]”
Maj. Op. ¶ 23, and relies on this assertion as a major premise for its resolution of this case.
This assertion and interpretation of Abeyta is incorrect.
{46} In Abeyta, the WCJ imposed the fee-shifting provision and ordered the employer to
14
pay all of the worker’s attorney fees. 2005-NMCA-087, ¶ 1. The employer appealed
arguing that the WCJ erred because the worker’s initial offer was “ambiguous,” and “[the
w]orker failed to show that his offer was less than the amount awarded in the final
compensation order . . . .” Id. The Court of Appeals proceeded to address these arguments
as conceptually distinct matters, and yet (knowingly or not) acknowledged their unity in the
course of its analysis.
{47} The Court of Appeals made special note of the fact that the employer and the worker
in Abeyta agreed (without reservation) that the worker had not reached MMI at the time he
provided his offer to the employer and, therefore, the offer did not and could not specify an
MMI date. Id. ¶¶ 10,13. The Court spent some time discussing the employer’s claim that
this feature of the offer rendered it ambiguous as a matter of contract law, id. ¶ 11, but this
aspect of Abeyta is inessential.
{48} Our Legislature’s decision to enact Section 52-1-54(F)(4) and punish employers who
refuse mutually advantageous settlement offers is rooted not in belief that the law of
contracts must be scrupulously upheld in the workers’ compensation context. Rather, the
motivation behind the statute is to encourage the maximally efficient resolution of cases.
Accordingly, the touchstone for determining whether fee shifting is appropriate is a simple
comparison of the value of the offer and award, a comparison that allows an empirical
assessment of whether an employer has wasted the worker and the Workers’ Compensation
Administration’s time and resources. It is this realization that lies behind the essential
conclusions reached in Abeyta.
{49} The Court determined in Abeyta that the lack of an agreement as to MMI given the
facts presented in Abeyta posed no impediment to the application of Section 52-1-54(F)(4).
Abeyta, 2005-NMCA-087, ¶ 13. The Court reasoned that it would thwart the underlying
purposes of Section 52-1-54(F)(4) to hold that parties cannot bargain around a variable
(MMI) both agree is indiscernible and concluded that an employer risks the imposition of
the fee-shifting provision as a penalty if it declines a settlement offer that resolves all other
variables for which fixed terms can be offered and that otherwise resolves the dispute.
Abeyta, 2005-NMCA-087, ¶ 13. These conclusions are correct.
{50} As both parties in Abeyta agreed that the MMI date could only be prospectively
assigned, the value of the worker’s settlement offer turned almost entirely on the other
assignable variables to the extent that they existed, i.e., TTD, WPI, medical costs, attorney
fees, etc. Because the worker offered terms as to those matters, the employer refused those
terms, and the worker ultimately got a better outcome as to those terms in the award, the
absence of an agreement as to MMI made only a marginal difference. The locus of the
“value” of the offer was the terms for the variables that could be fixed. Because the worker
offered less than he got as to those variables, the offer could be deemed less valuable than
the award and it was right to punish the employer for refusing the offer and prolonging the
proceedings. To be sure, leaving the question of MMI open necessarily meant that the
precise value of the offer in Abeyta was somewhat uncertain. But, that uncertainty was
15
tolerable and fell evenly on both parties. This reading of Abeyta is supported by the facts
presented there.
{51} The compensation award issued in Abeyta derived from a stipulation between the
parties that the employer’s second counteroffer fully settled the matter. 2005-NMCA-087,
¶ 5; see also id. ¶ 13 (“[A] compensation order entered pursuant to a settlement can be
utilized when evaluating whether an offer of judgment has been met under Section 52-1-
54(F).”). When comparing the offer and award, the Court of Appeals focused on the fact
that the TTD rate awarded exceeded the TTD rate offered and on the fact that the worker was
awarded payment for medical benefits he had not requested in his offer. Id. ¶¶ 14-15.
Because the parties stipulated that the offer fully settled the matter, we can infer that these
were the only variables apart from MMI at issue in the case. And because the employer
rejected a settlement offer with less valuable terms as to these variables, the Court correctly
concluded that the worker’s offer was less valuable than the compensation awarded.
Worker’s case is plainly distinguishable from Abeyta.
{52} Unlike Abeyta, the date of Worker’s MMI has nearly always been vigorously
disputed by the parties. Employer has insisted, since at least November 2013, that worker
reached MMI on July 22, 2013. From Employer’s perspective, Worker’s healing process
had already ended at the time he conveyed his settlement offer and he had reached MMI
years earlier. Worker’s case is unlike Abeyta in another crucial respect. Worker’s MMI date
was not the only term left unresolved in Worker’s offer. He failed to offer terms as to his
WPI rating. The record reflects that Employer has consistently contended that Dr. Balkman
correctly identified Worker’s WPI rating, while Worker has insisted that Dr. Balkman was
wrong and that his WPI was always much higher. These disputes—the date of Worker’s
MMI and his WPI rating—are legally significant to whether Worker’s settlement offer was
less valuable than the compensation awarded. To see why this is so, we must have some
general grasp of how workers’ compensation benefits are calculated and the benefits
calculation conducted in Worker’s case.
{53} TTD payments are issued until the date of MMI. Section 52-1-25.1 (2005); Madrid
v. St. Joseph Hosp., 1996-NMSC-064, ¶ 7, 122 N.M. 524, 928 P.2d 250 (“Eligibility for the
various temporary benefits provided under the [WCA] ends at the date of MMI. From this
point forward, the worker is entitled to further benefits only if he or she can establish a
permanent—either partial or total—disability.” (citation omitted)). “Compensation benefits,
including TTD benefits, are calculated based on a worker’s pre-injury ‘average weekly
wage.’” Baca v. Los Lunas Cmty. Programs, 2011-NMCA-008, ¶ 33, 149 N.M. 198, 246
P.3d 1070. “A worker is entitled to full TTD benefits if he is unable by reason of accidental
injury arising out of and in the course of the worker’s employment, to perform the duties of
that employment prior to the date of the worker’s [MMI].” Id. ¶ 32 (alteration in original)
(internal quotation marks and citation omitted). But see Ortiz v. BTU Block & Concrete Co.,
1996-NMCA-097, ¶ 10, 122 N.M. 381, 925 P.2d 1 (stating that the WCA “provides for
payment of [full] total disability benefits prior to [MMI] except in two enumerated
circumstances”).
16
{54} After MMI, a worker may be eligible for PPD benefits and, if eligible, will receive
a percentage of the compensation rate in PPD payments. See Hawkins v. McDonald’s,
2014-NMCA-048, ¶ 20, 323 P.3d 932 (“Once an injured worker reaches MMI, a different
statutory provision of the WCA takes effect. Under Section 52-1-26(B), a worker may be
eligible for PPD benefits if the worker has suffered a ‘permanent impairment.’ The
impairment constitutes the base value for the disability benefit award.”). The percentage of
benefit payments increases as WPI increases. Section 52-1-26.1. “If an injured worker
receives temporary disability benefits prior to an award of [PPD] benefits, the maximum
period for [PPD] benefits shall be reduced by the number of weeks the worker actually
receives temporary disability benefits.” Section 52-1-42(B) (1990); see Gurule v. Dicaperl
Minerals Corp., 2006-NMCA-054, ¶ 12, 139 N.M. 521, 134 P.3d 808 (citing with approval
the WCJ’s determination “that the duration of a worker’s benefit entitlement is based on a
weekly scheme, rather than an absolute dollar amount, and that the rate of the benefit may
vary over the duration of a worker’s entitlement”). Collectively, these provisions make clear
that a worker’s MMI and WPI are integral to assessing a worker’s total entitlement to
compensation. The facts of this case illustrate this point.
{55} The WCJ determined that Worker’s compensation rate is $629.11, his MMI date is
December 7, 2016, his WPI is 37%, and the “benefit period is 700 weeks.” Worker was
awarded roughly 268 weeks (October 14, 2011 through December 7, 2016) of TTD benefits,
a total of approximately $168,500 ($629 a week for 268 weeks). Worker was also awarded
roughly 432 weeks (the remainder of the 700 week benefit period) of PPD payments at
eighty-five percent (thirty-seven percent WPI plus forty-eight percent modifier points) of the
compensation rate, or approximately $231,000 (eighty-five percent of $629, a total of $535
a week for 432 weeks). As Worker’s MMI extended outward, he received additional weekly
TTD payments. As Worker’s WPI increased, his weekly PPD payment rate increased. To
see the significance of this observation, it is useful to compare what Worker would have
received had the WCJ accepted Dr. Balkman’s findings. This comparison is readily
achieved as Worker’s attorney offered this very comparison in his application for attorney
fees with the Workers’ Compensation Administration in an attempt to show just how much
additional benefits he obtained for Worker.
{56} If Dr. Balkman’s July 22, 2013 MMI determination governed, Worker would have
received $629 per week in TTD payments for only ninety-two weeks, a total of
(approximately) $58,000. This is nearly $110,500 dollars less than what Worker received
in light of the fact that the WCJ accepted Dr. Reeve’s findings. For PPD payments, if we
assume the modifiers remained forty-eight percent and then added only thirteen percent WPI
to reflect Dr. Balkman’s revised WPI determination, Worker’s weekly PPD payment would
have been only $384 per week (sixty-one percent of $629). This is $150 less per week than
what Worker was awarded.
{57} The WCJ was aware of the significance of MMI and WPI when he concluded that
Worker was not entitled to the application of Section 52-1-54(F)(4). The WCJ specifically
stated that Worker was not entitled to fee shifting because his offer did not “address material
17
facts and issues in dispute and determined at trial.” The WCJ’s conclusion can be translated
this way: because Worker failed to offer terms resolving all of the disputed matters bearing
on Worker’s entitlement to compensation benefits, Worker is not entitled to fee shifting
under Section 52-1-54(F)(4) because it was (and still is) impossible to determine whether
Worker’s settlement offer was less than the compensation awarded. This reasoning is sound.
{58} To hold, as the majority does, that an employer should be punished for refusing a
settlement offer the value of which is indiscernible and which left unresolved crucial matters
relating to benefits to which Worker claimed he was entitled and which the parties
vigorously disputed from nearly the inception of the proceedings is error. Our Legislature
could not have intended this result. Indeed, in the wake of this case, employers will likely
be confronted with some regularity by a Hobson’s choice: accept uncertain settlement offers
that do not propose terms sufficient to calculate liability, or reject such offers and run the
risk of the fee-shifting penalty. This outcome cannot be said to reflect a construction of the
WCA that is balanced and even handed to workers and employers.
{59} The majority justifies its conclusion on two closely related grounds. First, it states
that “[t]he absence of an MMI date does not preclude an opposing party from ascertaining
its potential liability set out in an offer of judgement” and cites Abeyta to support this claim.
Maj. Op. ¶ 23. From this assertion, the majority concludes that “Employer was well
informed as to the scope of its liability.” Id. ¶ 25. Second, the majority contends that
“[h]ere, although Employer points to uncertainty about the date of MMI and the rate of PPD
as sufficient to invalidate the offer of judgment, these are not critical issues if the worker’s
healing process is incomplete.” Id. ¶ 23. This point is repeated in later discussion. See id.
¶ 32 (“[A]s we explained in the previous section, an offer of judgment need not establish the
date of MMI or amount of PPD benefits if the healing process is still underway.”). I do not
agree with these claims.
{60} Where a worker declines to offer terms as to the date of MMI, the degree of WPI, or
any other term essential to calculating a Worker’s entitlement to benefits, the opposing party
will not be able to ascertain its liability because it will not be able to assess the value of the
offer. The majority’s assertions to the contrary are incorrect, and its reliance on Abeyta
misplaced.
{61} Abeyta is the exception, not the rule. As already noted, it holds that where both
parties agree that the MMI date is unknowable but the parties nevertheless settle all other
material variables bearing on benefit entitlement, the absence of a specified MMI date
produces only a tolerable range of uncertainty. This case is nothing like Abeyta, and the
preceding review of what Worker would have received with an earlier MMI date and a lesser
WPI rating reveals that Worker’s failure to offer terms created meaningful uncertainty that
cannot in any way be described as tolerable.
{62} It is possible that the majority believes this case is like Abeyta because the district
court ultimately found that Worker reached MMI on December 7, 2016—one year after
18
Worker submitted his settlement offer. This finding establishes that the WCJ did indeed
find that Worker was healing at the time he submitted his settlement offer. But the WCJ’s
findings cannot supply the basis for the imposition of a penalty where no offer fully
resolving the dispute is presented before the findings are issued. To put the point slightly
differently, the trial at which the WCJ made its findings about Worker’s MMI and WPI was
not unnecessary. Worker, having failed to issue a settlement offer that would sufficiently
resolve the disputed issues, cannot point to the outcome of trial and complain that Employer
should now pay a penalty for refusing terms and unnecessarily prolonging the litigation.
Terms were not offered. The litigation was not unnecessarily prolonged.
{63} Worker contends that this thinking is error as it necessarily requires him “to predict
an unknown date of MMI and to prematurely assess impairment and modifier values.” This
contention ignores the fact that medical professionals are routinely asked, in the course of
litigation, to make predictions. In fact, the doctor whose opinion was central to the dispute
in Abeyta made a prediction that has doubtless significance here: “Dr. Marchand predicted
an MMI date at a deposition taken two days before [w]orker’s offer, and by the time of the
hearing on attorney fees, it turned out that the MMI date was as Dr. Marchand had
predicted.” Abeyta, 2005-NMCA-087, ¶ 16. Moreover, the very question whether a worker
has reached MMI is itself predictive. See Smith v. Cutler Repaving, 1999-NMCA-030, ¶ 12,
126 N.M. 725, 974 P.2d 1182 (“[W]hether a worker has reached MMI turns on proof of a
reasonable medical probability of future recovery and lasting improvement.”). To the extent
a worker must make predictions about MMI or any other matter bearing on the worker’s
entitlement to benefits in order to present a settlement offer the value of which an employer
can assess, requiring the worker to make those predictions places no unusual burden upon
them.
{64} Leonard is the case to which the present matter bears the most resemblance. There,
the worker suffered two injuries to her back while working for two employers and filed two
workers’ compensation claims that were consolidated. 2007-NMCA-128 ¶¶ 1, 5. The
worker made an offer to the employers that was rejected, and she later prevailed at trial. Id.
¶¶ 5-7. Afterwards, the worker requested that the fee-shifting provision be applied and the
two employers pay 100% of her attorney fees. Id. ¶ 8. The WCJ rejected this request on
grounds that the offer did not address “the relative responsibilities of the [e]mployers . . . to
pay for surgical medical care for the [w]orker.” Id. ¶ 23.
{65} The worker appealed and argued that the WCJ’s reasoning was flawed because “her
offer of judgment, if accepted, would have disposed of all issues between her and the
employers.” Id. ¶ 24. She pointed out “that neither of the employers filed a cross-claim
against the other and that the employers would have had the option to move for
post-litigation proceedings for reimbursement, if necessary.” Id. The worker added that “the
legislative intent of Section 52-1-54(F) is to encourage settlement in workers’ compensation
cases and, in light of that purpose, [w]orker’s offer of judgment was not without legal effect
merely because it left some issues unresolved.” Id. The Court of Appeals was not
persuaded.
19
{66} It acknowledged that the worker was correct that “the purpose of Section 52-1-54(F)
is to encourage settlement,” but determined that the worker failed to proffer an offer that
specified each employer’s liability and, therefore, “cannot be said to provide a more or less
favorable outcome for the employers.” Leonard, 2007-NMCA-128, ¶ 25. In other words,
the worker’s offer could not be compared with the award to determine if the offer was of
lesser value. Worker’s case is analogous to Leonard.
{67} Worker’s offer failed to provide terms for specific, disputed matters relating to his
entitlement to benefits. Such an offer provides no basis for comparison to the compensation
award subsequently entered. Accordingly, Worker is not entitled to have Employer pay his
attorney fees.
{68} Worker cannot protest that Employer needlessly prolonged this litigation where
Worker failed to offer terms fully settling the benefit entitlement issues. The WCJ did not
err when he declined to impose Section 52-1-54(F)(4). The Court of Appeals correctly
affirmed the WCJ, and the Court of Appeals decision should be affirmed.
____________________________________
JUDITH K. NAKAMURA, Chief Justice
20