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                                  BRB No. 99-384

PETER GONZALEZ                          )
          Claimant-Petitioner           )
     v.                                 )
MATSON TERMINALS,                       )    DATE ISSUED:   12/23/1999
INCORPORATED                            )
          Self-Insured                  )
          Employer-Respondent           )    DECISION and ORDER

     Appeal of the Decision and Order of Alexander Karst, Administrative Law
     Judge, United States Department of Labor.

     David Utley (Devirian, Utley & Detrick), Wilmington, California, for

     William N. Brooks, II (Law Offices of James P. Aleccia), Long Beach,
     California, for employer.

     Before: SMITH, BROWN and McGRANERY, Administrative Appeals Judges.


     Claimant appeals the Decision and Order (98-LHC-347) of Administrative Law
Judge Alexander Karst rendered on a claim filed pursuant to the provisions of the
Longshore and Harbor Workers' Compensation Act, as amended, 33 U.S.C. §901
et seq. (the Act).  We must affirm the findings of fact and conclusions of
law of the administrative law judge which are rational, supported by substantial
evidence, and in accordance with law.  O'Keeffe v. Smith, Hinchman & Grylls
Associates, Inc., 380 U.S. 359 (1965); 33 U.S.C. §921(b)(3).

     Claimant injured his right hand on January 23, 1997, while pulling the handle
to the cover of a battery compartment on a bus.  Claimant was referred to Dr.
O'Hara, a hand specialist, who diagnosed a torn muscle and opined that claimant has
a ten percent impairment to his right hand.  Claimant sought permanent partial
disability benefits under the Act.  After the hearing on July 9, 1998, employer
submitted a letter to the administrative law judge dated July 23, 1998, which
stated that employer accepted liability for a ten percent impairment of claimant's
right hand. Claimant's counsel responded on July 28, 1998, requesting that the
issue be held in abeyance until claimant's return on approximately August 3, 1998. 
Employer replied on July 29, 1998, that it would withhold payment of the scheduled
permanent partial disability benefits until claimant's counsel had conferred with
claimant.  In a letter to the administrative law judge dated August 4, 1998,
claimant responded to employer's letter, stating that he did not object to
employer's post-hearing acceptance of liability for a ten percent impairment of the
hand.  In addition, he requested that the administrative law judge "retain
jurisdiction with respect to attorney fees and costs," and raised a new issue
regarding a violation of Section 49 of the Act, 33 U.S.C. §948a, which
occurred after the hearing.  Claimant also corresponded with employer on August 4,
1998, questioning the delay in the scheduled payment.  Subsequently, employer
submitted a letter to the administrative law judge dated August 14, 1998,
withdrawing the previous correspondence and requesting a decision on the record.

     The administrative law judge rejected claimant's contention that employer was
bound by the "acceptance of liability" letter submitted post-hearing.  He found
that the letter was a stipulation and that as it was not submitted prior to the
hearing, it was not binding on employer.  In addition, the administrative law judge
found that the weight of the more credible evidence shows that claimant's hand
injury has not caused him any ratable permanent disability.  Thus, the
administrative law judge denied permanent partial disability benefits.

     On appeal, claimant's assignment of error relates to the administrative law
judge's refusal to accept employer's July 23, 1998 letter as a binding acceptance
of liability.  Claimant contends that the letter constituted admissions which
should have been admitted into evidence and accepted by the administrative law
judge or, in the alternative, a written offer to claimant "with respect to the
issues referenced therein which was accepted by claimant by means of his attorney's
letter dated August 4, 1998," thereby resolving said issues and no longer requiring
the administrative law judge to resolve the issues.  Claimant also argues that the
letter constituted a withdrawal of controversion of the issues of the extent of his
disability.  Claimant does not contest the administrative law judge's finding that
claimant has no ratable impairment.  Employer responds, urging affirmance of the
administrative law judge's decision.

     Initially, we reject claimant's contention that the letter dated July 23,
1998, was a withdrawal of controversion pursuant to Section 702.351 of the
regulations, 20 C.F.R. §702.351.  Section 702.351 essentially assumes that the
parties have decided to voluntarily dispose of the claim in a manner consistent
with informal proceedings, thus obviating the need for a formal hearing on the
issues. Falcone v. General Dynamics Corp., 21 BRBS 145 (1988).  In the
instant case, the letter was submitted after the parties had already formally
presented the case to the administrative law judge, although a decision had not yet
been issued.  Moreover, before the administrative law judge addressed the issue
raised in the letter, namely the acceptance of liability, employer withdrew the
previous correspondence and requested a decision on the record.   Thus, as the
parties were not in agreement, we hold that Section 702.351 is not applicable in
this case. Falcone, 21 BRBS at 147; Sans v. Todd Shipyards Corp., 19
BRBS 24, 28 (1986).

     In addition, we reject claimant's contention that the letter constitutes a
binding admission pursuant to Section 18.801(2), 29 C.F.R. §18.801(2).  This
subsection is a definition of statements which are not considered hearsay in
administrative hearings, and is not applicable to find that employer in the instant
case made a binding "admission."  The section that does address admissions, 29
C.F.R. §18.20, outlines the discovery procedure to be followed prior to the
hearing in order to request or deny admission of the truth of any specified
relevant matter of fact.  Any dispute regarding admissions is to be resolved at a
prehearing conference or at a designated time prior to the hearing. 29 C.F.R.
§18.20(d).  Moreover, any matter admitted under this section is conclusively
established unless the administrative law judge, on motion, permits withdrawal or
amendment of the admission. 29 C.F.R. §18.20(e).  As employer did not send the
letter in question until after the hearing, and as the letter was withdrawn prior
to a decision by the administrative law judge, we hold that this regulation is
inapplicable in the instant case.

     Claimant also contends that the letter of July 23, 1998, should be construed
as an offer to settle the disputed issues, which claimant accepted by letter dated
August 4, 1998, resulting in a binding contract.  Although arguably an offer and
acceptance was made here, because a claim may not be withdrawn in exchange for a
sum of money, see 33 U.S.C. §915(b), as that would violate the Act's
explicit prohibition of waiver of compensation, the parties must follow the
settlement procedures of Section 8(i), 33 U.S.C. §908(i), if claimant wishes
to withdraw his claim in return for a sum of money.  Norton v. National Steel
& Shipbuilding Corp., 25 BRBS 79, 84 (1991), aff'd on recon. en banc,
27 BRBS 33 (1993)(Brown, J., dissenting); O'Berry v. Jacksonville Shipyards,
Inc., 21 BRBS 355 (1988), aff'd in pert. part on recon., 22 BRBS 430
(1989); see also Jennings v. Lockheed Shipbuilding & Construction Co., 9
BRBS 212 (1978); 33 U.S.C. §§908(i), 915(b).  Inasmuch as the
correspondence between the parties cannot be construed as an agreement to settle
the claim pursuant to Section 8(i), and as no settlement application was submitted
to the administrative law judge in accordance with the regulations found at 20
C.F.R. §§702.241-702.243, we reject claimant's contention that the letter
of July 23, 1998, was a binding settlement offer under the Act. Cf. Oceanic
Butler, Inc. v. Nordahl, 842 F.2d 773, 21 BRBS 33 (CRT)(5th Cir. 1988)(In the
absence of an express contractual provision, an employer has no right of rescission
from a properly submitted Section 8(i) settlement prior to administrative action
on the settlement).  There is no other mechanism available under the Act to enforce
a contract between the parties.
     In conclusion, the letter from employer dated July 23, 1998, was submitted
after the administrative law judge had heard the testimony and received the
evidence of record.[1]  Before a decision was
issued, employer withdrew the letter and requested a decision on the record.  As
claimant has identified no procedural error, and the case was properly before the
administrative law judge for a decision, we affirm the administrative law judge's
finding that the letter of July 23, 1998, was not a binding acceptance of liability
and thus affirm the denial of benefits.

     Accordingly, the Decision and Order of the administrative law judge denying
benefits is affirmed.


                              ROY P. SMITH
                              Administrative Appeals Judge

                              JAMES F. BROWN
                              Administrative Appeals Judge

                              REGINA C. McGRANERY
                              Administrative Appeals Judge

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1) 1The record was left open solely for a deposition by Dr. London, which was taken July 21, 1998. Back to Text

NOTE: This is an UNPUBLISHED LHCA Document.

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