Sugano v. State, Dept. of Atty. Gen.

NO'I` F()R Pl.?lilil(l»&'l`l(')i\‘ lN \V}ES'I"S I~L&\VAI"I RICI’()R'I`S ANI) PACIFlC REP()R'I`EI{

NO. 29246

IN THE lNTERMEDlATE COURT OF APPEALS

or THE STATE oF HAWA;):‘:

WARREN A. SUGANO, Claimant~Appellant,
v.
STATE OF HAWAfI, DEPARTMENT OF THE ATTORNEY GENERAL,
Employer~Appellee, Self-Insured

APPEAL FROM THE LABOR AND INDUSTRIAL RELATIONS
APPEALS BOARD
(CASE NO. AB 2004-055 (2~OO~4l270))

SUMMARY DISPOSITION ORDER
(By: Nakamura, C.J., Foley and Fujise, JJ.)
Claimant-Appellant Warren A. Sugano (Sugano) appeals
from (l) the September 4, 2007 Decision and Order (D&O) of the
Labor and Industrial Relations Appeals Board (LIRAB), in which
LIRAB affirmed the denial of Sugano's Workers' compensation claim
and concluded that Sugano had filed his appeal to LIRAB in a
timely manner, and (2) the November 2, 2007 Order Denying
[Sugano's] Motion for Reconsideration and Reopening (Order
Denying Reconsideration).
On appeal, Sugano contends
(l) the D&O and Order Denying Reconsideration failed
to acknowledge and apply all relevant information
and statements and LIRAB failed to incorporate in
the D&O and Order Denying Reconsideration a ruling
upon each of Sugano's proposed findings of fact;
(2} LIRAB erroneously based its D&O Finding of Fact
(FOF(s)) 14 on Dr. Eliashof's inadmissible
evaluation of Sugano;
(3) LIRAB failed to address Dr. Koff's assessment of

Sugano;

NOT FOR F'UIKI.!ICA"|`I()N IN \‘\’EST‘S HAWi-Al`l REP()RTS ANI) PACIF`IC RF,POR'I`EI{

{4) L1RAB erroneously based its D&O FOF 2 on the
unsupported conclusion of Kaulana Young‘s lawful
authority;

(5) LIRAB erroneously drew D&O Conclusion of Law (COL)
1 in spite of a lack of evidence;

(6) LIRAB failed to address the audio recording of the
HawaFi Merit Appeals Board October 20, 2005
hearing;

(7) LIRAB erred in admitting Dr. Eliashof's August 28,
2001 Independent Medical Evaluation (IME) report
as an exhibit;

(8) LlRAB unnecessarily addressed in the D&O FOFs 21
through 25 and COL 2 the issue of the filing
timeliness of Sugano's appeal;

(9) LIRAB erred when it failed to address the issue of
Sugano's reimbursement for eight hours of sick
leave taken to attend to Dr. Eliashof's IME; and

(10) a conflict of interest exists because, on appeal,
Deputy Attorney General John H. Murphy (Murphy)
represents both LIRAB and the State of Hawafi
Attorney General's Office (Employer), violating
HawaFi Rules of Professional Conduct (HRPC) 1.7.

Sugano argues that these grounds justify vacating LIRAB's D&O.

Upon careful review of the record and the briefs

submitted by the parties and having given due consideration to
the arguments advanced and the issues raised by the parties, as
well as the relevant statutory and case law, we resolve Sugano’s
points of error as follows:

First, we must address Employer's argument that

Sugano's appeal was untimely because Sugano filed his notice of
appeal with the circuit court instead of with LIRAB.

On September 4, 2007, LIRAB entered its D&O. On

October 4, 2007, pursuant to Hawaii Administrative Rules (HAR)

§ 12~47-53, Sugano timely filed a “Motion for Reconsideration and

l\`(`)'l` I+`()l?l PLEBL`ICATI()N' IN \I‘&"PIS`T'S l*l,/\\\"A.l"`li R ¥L`,l’(`f)R"l`S .»\Nl) PACIFIC `R!SPOR'I`ICI{

Reopening of [D&Gl" with LlRAB. HAR § 12~47-53 requires that a
motion for reconsideration or reopening of a case be filed within
30 days after mailing of the D&O to the parties. On November 2,
2007, LlRAB denied the motion and mailed copies of the denial to
the parties. HAR § 12~47~53 further requires that "{ilf the
request for reconsideration or reopening is denied, the time to
initiate judicial review shall run from the date of mailing the
denial decision." HRS § 386~88 (Supp. 2009) provides that an
appeal must be filed within thirty days of mailing the decision
or order, On November 30, 2007, Sugano timely filed a document
titled "Notice of Appeal to the Circuit Court" with the clerk of
the circuit court and personally served a copy on LIRAB, as
indicated by the certificate of service attached to the motion.

Employer argues that under HRS § 386~88,3 Sugano should
have filed his notice of appeal of the D&O with the "appellate
board," i.e., LIRAB, not the circuit court. However, Sugano
personally served a copy of the notice of appeal on LIRAB.
Therefore LIRAB was on notice that Sugano had filed an appeal and
was appearing pro se, and LIRAB should have processed Sugano's
appeal despite the title of his document. We hold that Sugano's
appeal was timely filed, and we have jurisdiction.

Sugano failed to ensure that transcripts of hearings
were ordered and filed. Therefore, we are unable to address
Sugano's evidentiary challenges, as well as his challenges to
FOFs and COLs that require a review of the transcripts. §§e

Lepere v. United Pub. Workers, Local 646, AFL~C10, 77 HawaFi

47l, 474, 887 P.2d lO29, lO32 (l995).

1 HRS § 386-88 provides in part:

§386~88 Judicia1 review. The decision or order of the
appellate board shall be final and conclusive, . . . unless within
thirty days after mailing of a certified copy of the decision or
order, the director or any other party appeals to the intermediate
appellate court, subject to chapter 602, by filing a written
notice of appeal with the appellate board.

3

NO'I` FO,R K’I,F.BL[(.`.»\’I`_I(`)N IN Wl‘u`S'l"S HAW,A`|"I RE'P()R'I"S ANI) I’ACTIFK§` RHPORTER

Sugano contends that HRS § 91~12 (1993) required L1RAB
to address all 39 of his proposed FOFs iPFOFs}3 filed on
March l6, 2007. HRS § 91~l2 provides:

§9l~l2 Decisions and orders. Every decision and
order adverse to a party to the proceeding, rendered by an
agency in a contested case, shall he in writing or stated in
the record and shall be accompanied by separate findings of
fact and conclusions of law. If any party to the proceeding
has filed proposed findings of fact, the agency shall
incorporate in its decision a ruling upon each proposed
finding so presented. The agency shall notify the parties
to the proceeding by delivering or mailing a certified copy
of the decision and order and accompanying findings and
conclusions within a reasonable time to each party or to the
party‘s attorney of record.

(Emphasis added.) Although the plain language of HRS § 91~12
indicates a bright line rule, courts have interpreted the rule to
permit them some leeway in responding to the parties' PFOFs. §e§
Survivors of Timothy Freitas, Dec. v. Pac. Contractors Co., 1

Haw. App. 77, 34, 613 P.2a 927, 932 (i930> (h@1ding that although
the court has to respond to each proposed finding, a ruling on
each proposed finding is not indispensable).

The purpose of HRS § 91~12 "is to assure reasoned
decision making by the agency and enable judicial review of
agency decisions." ln re Hawaii Elec. Liqht Co., 60 Haw. 625,
64l~42, 594 P.2d 612, 623 (1979). We conclude that an agency
board can achieve this goal without responding to every proposed
finding of fact raised by the parties.

In Dedman v. Board of Land & Natural Resources, 69 Haw.
255, 265, 740 P.2d 28, 35 (1987), the HawaFi Supreme Court
explained that HRS § 91~12 "requires that the parties not be left
to guess, with respect to any material questions of fact, or to
any group of minor matters that may have cumulative significance,
the precise findings of the agency." The LIRAB's FOFs
appropriately address material questions of fact and those minor

matters with cumulative significance. Just because the FOFs do

3 This section addresses Sugano's points of error (l), (3), (6/, and

N()'l` FOR I’l.?'}¥L»`IC.»-\'l`I()N lN WIIS'I"S l~IA\‘V/KI‘I R.PII`~*OR"I`S ANI) IIA.C.`.IIY`IC REI’()R"|`}:II{

not address what Suganc himself deems significant does not
invalidate them.

Sugano contends LIRAB's acceptance of Dr. Eliashof's
IME report into evidence constituted an abuse of discretion.
Sugano maintains that the DLlR‘s decision to suppress the report
at the August l3, 2002 hearing barred LlRAB from subsequently
permitting the introduction of the report. we disagree.

HAR § l2~47-41 provides LIRAB with wide discretion in
managing evidence:

The board shall not be bound by statutory and common law
rules relating to the admission or rejection of evidence.
The board may exercise its own discretion in these matters,
limited only by considerations of relevancy, materiality,
and repetition, by the rules of privilege recognized by law,
and with a view to securing a just, speedy, and inexpensive
determination of the proceedings.

Dr. Eliashof‘s report, which addressed Sugano's mental state and
his claims against Employer, was clearly relevant and material.
lt is not privileged because the evaluation was never intended to
be confidential. lt was prepared to supply information to the
State of HawaFi Workers' Compensation Division to assess
Sugano‘s claims for compensation. The consideration of this
single report did not slow down or unfairly prejudice LIRAB's
disposition of Sugano's appeal. Therefore, LlRAB did not abuse
its discretion in permitting the introduction of Dr. Eliashof's
IME report.

Sugano contends LIRAB unnecessarily readdressed the
issue of the filing timeliness of his LIRAB appeal and takes
issue with this use of administrative resources. Sugano claims
the issue had been settled in his favor at a hearing on
Employer's motion to dismiss Sugano‘s LlRAB appeal and in the
June l4, 2004 Order Denying Motion to Dismiss Appeal. LIRAB's
D&O nonetheless concluded that Sugano's filing was timely. We
find no error in LIRAB‘s memorializing the issue of Sugano's

timely filing in its D&O.

NC)'T l?`()l~l Pl.?l%l.l(_T./»‘{MI`]'(JN IN WFES"I"S I'l/-\\\"Alf‘l' RI".P()R'I`S AN`D PACI’FIC R`EI’ORTEI{

Sugano contends the representation of Employer and
LIRAB by DAG Murphy created a conflict of interest in violation
of HRPC l.7. This court does not enforce the HRPC. §eQ Rules of
Supreme Court Rules 2.l~2.3 & 2.4(e>{l}. we can provide Sugano
no relief on this claim.

Sugano contends his stress~related injury was not the
result of good~faith disciplinary action. Employer argues that
if Sugano suffered from any stress~related injury, it resulted
solely from good~faith disciplinary action. HRS § 386~3(c)
(Supp. 2009) exempts claims for stress-related injuries arising
out of good-faith disciplinary action from workers' compensation

coverage:

(c) A claim for mental stress resulting solely from
disciplinary action taken in good faith by the employer
shall not be allowed; provided that if a collective
bargaining agreement or other employment agreement specifies
a different standard than good faith for disciplinary
actions, the standards set in the collective bargaining
agreement or other employment agreement shall be applied in
lieu of the good faith standard.

We agree with LIRAB's FOFs on the issue of Sugano's good-faith
discipline:
16. [Young] testified credibly at trial that
[Sugano] was not singled out or treated differently from
other investigators. He required all his investigators to
submit weekly time sheets. [Young] issued the October l3,
2000 memorandum because [Sugano] was repeatedly late with

his time sheets. For reasons unknown to him, the October 3,
2000 memorandum was not placed in [Sugano’s] personnel file.

l7. The Board finds that the October 13, 2000
memorandum was a written reprimand and, therefore, an act of
discipline.

l8. Employer's disciplinary action, in the form of

the October l3, 2000 letter of written reprimand, was taken
in good faith and with just cause.

l9. Despite his conflicts with Employer relating to
overtime, those conflicts did not prevent [Sugano] from
working and it was not until he received the October l3,
2000 memorandum that [Sugano] stopped work.

20. {Sugano‘s} mental stress injury, if any, on
October l3, 2000, resulted solely from disciplinary action
taken by Employer.

N(`)"l` F(`)R P\IBI.,IC.T.A'I`I()N IN \Vl»".`S'I"S I*IAWAI‘I I{EP()P.'I`S AND P.=XCIFIC RI:`,P()R'I`F,R

These findings substantially support LlRAB‘s COL that Sugano's
stress~related injury resulted from good-faith disciplinary
action. Sugano accordingly did not present a compensable claim
under HRS § 3SC»3.

Therefore,

The September 4, 2007 Decision and Order of the Labor
and industrial Relations Appeals Board and the November 2, 2007
0rder Denying [Sugano'sl Motion for Reconsideration and Reopening
are affirmed.

DATED: Honolulu, HawaFi, January 22, 2010.
On the briefs:

warren A. Sugano,
Claimant-Appellant pro se.

7/75£.»%»,»»~
James E. Halvorson and C::;%5

John H. Murphy, Chief Judge

Deputy Attorneys General,
(}Q;m»C%§?E?

for Employer»Appellee.
Associate Judge

drawn §§ r..~-

Associate Judge