Hussein v. Showplace Wood Products Inc. , 2023 S.D. 11 ( 2023 )

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2023 S.D. 11IN THE SUPREME COURT
OF THE
STATE OF SOUTH DAKOTA
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ABDIRAHMAN YUNIS HUSSEIN, Claimant and Appellant,
v.
SHOWPLACE WOOD PRODUCTS INC., Employer and Appellee,
and
DAKOTA TRUCK UNDERWRITERS, Insurer and Appellee.
****
APPEAL FROM THE CIRCUIT COURT OF
THE SECOND JUDICIAL CIRCUIT
MINNEHAHA COUNTY, SOUTH DAKOTA
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THE HONORABLE SANDRA H. HANSON
Judge
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STEVEN G. HAUGAARD
Sioux Falls, South Dakota Attorney for claimant
and appellant.
CHARLES A. LARSON
NICHOLAS M. RAMOS of
Boyce Law Firm, LLP
Sioux Falls, South Dakota Attorneys for employer and
insurer appellees.
****
CONSIDERED ON BRIEFS
FEBRUARY 15, 2023
OPINION FILED 03/01/23
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DEVANEY, Justice
[¶1.] In this workers’ compensation case, an administrative law judge
granted the employer and insurer summary judgment against the employee’s
petition claiming entitlement to workers’ compensation benefits. The employee
appealed the decision to the circuit court; however, because the employee did not
serve the notice of appeal on the Department of Labor, the court dismissed the
appeal for lack of subject matter jurisdiction. The employee appeals, and we affirm.
Factual and Procedural Background
[¶2.] On September 24, 2018, Abdirahman Hussein suffered a work-related
injury at Showplace Wood Products (Employer) when chemical solvent came into
contact with his eyes while he was cleaning the hoses for a pressurized sprayer.
After the incident, Employer and its insurer, Dakota Truck Underwriters (Insurer),
deemed his injury compensable and paid Hussein workers’ compensation benefits.
However, in June 2020, Employer/Insurer issued Hussein a letter denying further
benefits because a doctor opined that he did not require additional treatment for his
work-related injury.
[¶3.] On September 25, 2020, Hussein petitioned the Department of Labor
(Department) for a hearing on his claim that he is entitled to additional workers’
compensation benefits. He asserted that his work injury was and continues to be a
major contributing cause of his need for treatment and further asserted that his
injury was caused by Employer’s failure to follow state laws, OSHA guidelines, and
the safety recommendations for the products used. The administrative law judge
(ALJ) entered a scheduling order requiring Hussein to disclose and identify his
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experts by July 21, 2021. Hussein did not disclose experts by this date, and as a
result, Employer/Insurer moved for summary judgment, asserting that without an
expert witness, Hussein could not prove that his work injury was a major
contributing cause of his current claimed condition. In response, Hussein submitted
multiple affidavits from physicians, along with attached medical records, and
asserted that these submissions establish a material issue of fact in dispute
precluding summary judgment.
[¶4.] On November 1, 2021, the ALJ issued an amended letter decision,
granting Employer/Insurer summary judgment. The ALJ determined that no
genuine issue of material fact existed because “without a medical expert to testify
regarding the relationship between the medical evidence and his physical state,
Hussein cannot prove that the work-injury is a major contributing cause of his
current condition.” The ALJ further determined that Hussein’s claim that
Employer’s conduct caused the injury was not relevant to the question of causation
relating to his current condition and thus did not create a genuine issue of material
fact in dispute precluding summary judgment.
[¶5.] On November 15, 2021, counsel for Hussein submitted a letter by
email designated as a “formal request for an Appeal Hearing” to the ALJ and
counsel for Employer/Insurer. Hussein attached to the email: (1) a completed form
for a request for an appeal to the Reemployment Assistance Division; (2) a
document titled “Request for an appeal hearing on the amended letter decision on
motion for summary judgment”; and (3) a letter from Hussein’s counsel addressed to
the Division of Labor and Management formally requesting an appeal hearing. The
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ALJ replied to counsel for both parties, indicating that the appeal request form was
only for the Reemployment Assistance Division and that counsel could appeal the
workers’ compensation decision in one of two ways: directly to the circuit court
within 30 days after the decision; or through a request for a Department of Labor
review within 10 days after the decision. 1 The ALJ concluded the email by stating
that if counsel intended the “appeal request form to act as a request for
[Department] review,” the ALJ would “forward the matter to the appropriate
recipients[,]” but if Department review was not the request, then counsel “will need
to appeal directly to the circuit court.”
[¶6.] In a responsive email, counsel for Hussein indicated that he “would
rather request [Department] review[.]” However, he asked whether such review
would be possible given that his initial email and documents were sent more than
ten days after the ALJ’s workers’ compensation decision. The ALJ replied, “As it
has been longer than ten days, the petition for review would not be timely.”
[¶7.] On December 1, 2021, Hussein filed a notice of appeal in circuit court,
seeking to challenge the ALJ’s workers’ compensation decision. As part of his notice
of appeal, Hussein included a statement of issues and attached approximately 200
pages of documents from the underlying workers’ compensation record. Hussein’s
certificate of service indicates that the notice of appeal and statement of issues were
served on counsel for Employer/Insurer on November 30, 2021.
1. SDCL 62-7-16 provides in relevant part that “[a]ny party to proceedings
before the department may within ten days after service upon the party of a
decision of the department, as provided in § 62-7-13, file with the department
a petition for a review of the decision.”
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[¶8.] On December 17, 2021, Employer/Insurer moved to dismiss Hussein’s
appeal for lack of subject matter jurisdiction based on Hussein’s failure to serve the
notice of appeal on the Department. At the conclusion of a hearing on March 14,
2022, the circuit court orally granted Employer/Insurer’s motion to dismiss,
concluding that the failure to serve the notice of appeal on the Department deprived
the court of jurisdiction to consider Hussein’s appeal.
[¶9.] On March 23, 2022, Hussein filed a motion for reconsideration,
asserting that additional evidence would show that the notice of appeal was
properly provided to the Department. In his brief in support of his motion, Hussein
attached the November 2021 email exchange with the ALJ regarding his desire to
appeal the ALJ’s amended letter decision. After a hearing on May 9, 2022, the
circuit court issued an order denying Hussein’s motion to reconsider. It considered
counsel’s arguments and submissions and determined that Hussein failed to perfect
his appeal because he did not serve the notice of appeal on the Department. The
court issued a written order granting Employer/Insurer’s motion to dismiss
Hussein’s appeal on May 10, 2022.
[¶10.] Hussein appeals to this Court, asserting that the circuit court erred in
dismissing his administrative appeal for lack of subject matter jurisdiction.
Standard of Review
[¶11.] As the Court recently stated,
We review a circuit court’s dismissal for lack of appellate
jurisdiction as a “question of law under the de novo standard of
review.” Upell v. Dewey Cnty. Comm’n, 2016 S.D. 42, ¶ 9, 880
N.W.2d 69, 72 (quoting AEG Processing Ctr. No. 58, Inc. v. S.D.
Dep’t of Revenue and Reg., 2013 S.D. 75, ¶ 7 n.2, 838 N.W.2d
843, 847 n.2). See also Watertown Co-op Elevator Ass’n v. S.D.
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Dep’t of Revenue, 2001 S.D. 56, ¶ 7, 627 N.W.2d 167, 170
(holding that a decision to dismiss an administrative appeal to
circuit court is reviewed de novo). “Further, when statutory
interpretation is relevant to the inquiry, ‘statutory
interpretation is also a question of law, reviewed de novo.’”
Upell, 2016 S.D. 42, ¶ 9, 880 N.W.2d at 72 (quoting AEG, 2013
S.D. 75, ¶ 7 n.2, 838 N.W.2d at 847 n.2).
Abdulrazzak v. Bd. of Pardons and Paroles, 2020 S.D. 10, ¶ 9, 940 N.W.2d 672, 675.
Analysis and Decision
[¶12.] Under SDCL 1-26-31,
An appeal shall be taken by serving a copy of a notice of appeal
upon the adverse party, upon the agency, and upon the hearing
examiner, if any, who rendered the decision, and by filing the
original with proof of such service in the office of the clerk of
courts of the county in which the venue of the appeal is set,
within thirty days after the agency served notice of the final
decision or, if a rehearing is authorized by law and is requested,
within thirty days after notice has been served of the decision
thereon. Failure to serve notice of the appeal upon the hearing
examiner does not constitute a jurisdictional bar to the appeal.
(Emphasis added.) This Court has made clear that this statute “provides the basis
for the circuit court to exercise jurisdiction[,]” Schreifels v. Kottke Trucking, 2001
S.D. 90, ¶ 7, 631 N.W.2d 186, 188 (citation omitted), and that complying with its
requirements “is essential to a circuit court’s appellate jurisdiction[,]” Abdulrazzak,
2020 S.D. 10, ¶ 11, 940 N.W.2d at 675.
[¶13.] Here, Hussein timely filed his appeal in circuit court from the ALJ’s
amended decision and timely served the notice of appeal on Employer/Insurer.
However, he failed to serve the notice of appeal on the Department within 30 days
after the ALJ’s decision. In Stark v. Munce Brothers Transfer & Storage, this Court
held that such failure is a jurisdictional error and requires dismissal of the appeal.
461 N.W.2d 587, 588–89 (S.D. 1990). In so concluding, we rejected the employee’s
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argument that the failure to serve the Department could be excused because “the
agency is not a party to the appeal and only performs administrative functions.” Id.
at 588. The Court noted that “the notice of appeal to the Department of Labor does
more than order the completion of administrative functions”; it “serves as a notice of
transfer of jurisdiction from the executive branch to the judicial branch.” Id. at
588–89. Further and importantly, “[w]hen the legislature prescribes a procedure
for circuit court review of the action of an administrative body, the conditions of the
procedure must be complied with before jurisdiction is invoked.” Id. at 588.
[¶14.] Because SDCL 1-26-31 “is clear and uses mandatory language[,]”
Stark, 461 N.W.2d at 588, this Court has also held that a circuit court does not
acquire subject matter jurisdiction over an administrative appeal when the
employee fails to file the notice of appeal in the proper county, Schreifels, 2001 S.D.
90, ¶ 12, 631 N.W.2d at 189, or, under a prior version of SDCL 1-26-31, fails to serve
the notice of appeal on the hearing examiner, Slama v. Landmann Jungman Hosp.,
2002 S.D. 151, ¶ 10, 654 N.W.2d 826, 829. In Slama, the Court noted the apparent
harshness of the result, but left for the Legislature “to change the service
requirement if it is unnecessary or poses an unreasonable hurdle in certain
circumstances.” Id. ¶ 9.
[¶15.] Presumably in response to Slama, the Legislature amended SDCL 1-
26-31 in 2004 to provide that the failure to serve the notice of appeal on the hearing
examiner does not deprive the circuit court of subject matter jurisdiction. Yet the
Legislature did not likewise revise the jurisdictional provision in SDCL 1-26-31
requiring service of the notice of appeal on the agency in response to this Court’s
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decision in Stark. See Phen v. Progressive N. Ins. Co., 2003 S.D. 133, ¶¶ 20–21, 672
N.W.2d 52, 58 (noting that the Legislature was aware of this Court’s past decision
and chose to allow the ruling to stand despite making other changes to the
governing statutes). Therefore, Hussein was required to serve the notice of appeal
on the Department in order to invoke the circuit court’s appellate jurisdiction. 2
[¶16.] Hussein nevertheless notes this Court’s prior holding that “[n]otices of
appeal should be liberally construed in favor of their sufficiency.” See Int’l Union of
Operating Eng. v. Aberdeen Sch. Dist., 463 N.W.2d 843, 844 (S.D. 1990). He asserts
that because he sent his email request for an appeal hearing to the ALJ, the
Department of Labor and Regulation, and opposing counsel on November 15, 2021,
he “complied with notice requirements stated in SDCL 1-26-31[.]” He further
asserts that the ALJ’s email response on November 15 “clearly evidences that the
Request for an Appeal [was] served and accepted as [a] Notice of Appeal.”
[¶17.] While this Court has construed the sufficiency of the contents of a
notice of appeal liberally, the question here concerns whether the service of the
notice of appeal invoked the circuit court’s appellate jurisdiction. In that regard,
Hussein’s November 2021 email and submissions to the ALJ did not satisfy the
requirements of SDCL 1-26-31 because they do not constitute service to the
Department of his December 1, 2021 appeal filed in the circuit court.
[¶18.] Although not characterized as such by Hussein, it appears he is
suggesting that the doctrine of substantial compliance applies because his
2. Hussein also did not serve the notice of appeal on the ALJ. However, as
SDCL 1-26-31 now provides, such failure does not deprive the circuit court of
jurisdiction.
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November 2021 email and submissions show that he wanted to appeal the ALJ’s
workers’ compensation decision. “‘Substantial compliance’ with a statute means
actual compliance in respect to the substance essential to every reasonable objective
of the statute.” Larson v. Hazeltine, 1996 S.D. 100, ¶ 19, 552 N.W.2d 830, 835
(citation omitted). But “the doctrine of substantial compliance cannot be
substituted for jurisdictional prerequisites.” AEG, 2013 S.D. 75, ¶ 23, 838 N.W.2d
at 850. Therefore, full compliance with the jurisdictional prerequisites in SDCL 1-
26-31 is required. Schreifels, 2001 S.D. 90, ¶ 10, 631 N.W.2d at 189.
[¶19.] Because Hussein did not serve his notice of appeal to the circuit court
on the Department within 30 days after the ALJ served notice of its amended letter
decision, the circuit court properly dismissed Hussein’s administrative appeal.
Further, because the circuit court was without subject matter jurisdiction, this
Court likewise lacks jurisdiction over the merits of Hussein’s appeal. See Cable v.
Union Cnty. Bd. of Cnty. Comm’rs, 2009 S.D. 59, ¶ 52, 769 N.W.2d 817, 833.
[¶20.] Affirmed.
[¶21.] JENSEN, Chief Justice, and KERN, SALTER, and MYREN, Justices,
concur.
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