WCAB Lacks Authority to Act on Petition for Reconsideration After 60 Days

Tuesday, December 19, 2023 | 2

A California appellate court ruled that if the Workers’ Compensation Appeals Board does not act on a petition for reconsideration of a decision by an arbitrator or workers’ compensation judge within 60 days, it loses jurisdiction over the matter, and decisions on the petition after 60 days are void.

Carlos Uribe worked for XCEL Mechanical Systems Inc. He suffered an injury at work in September 2000. XCEL had workers’ compensation coverage through Reliance Insurance.

Reliance later became insolvent, and the California Insurance Guarantee Association assumed its liabilities by operation of law.

Nearly 20 years after Uribe’s injury, CIGA petitioned to join the Zurich American Insurance Co. to his claim, contending that Zurich provided coverage for XCEL in September 2000.

The Workers’ Compensation Appeals Board ordered Zurich joined as a party defendant, and Zurich denied liability for Uribe’s injury.

The parties arbitrated whether Zurich was liable for payments made on Uribe’s claim. On Aug. 23, 2021, the arbitrator denied CIGA’s petition, finding its claim that Zurich provided coverage for XCEL concerning Uribe’s injury was not supported by substantial evidence.

On Aug. 31, 2021, CIGA filed for reconsideration. The WCAB did not act on the petition within the 60 days allowed by Labor Code Section 5909. The petition was therefore deemed denied by operation of law.

CIGA did not file a petition for review of the denial in the Court of Appeal. Instead, it filed a brief arguing that the WCAB retained jurisdiction over the petition because it had not been forwarded to the board until Oct. 6, 2021, a month and a half after CIGA filed.

Citing Shipley v. WCAB (City of Whittier), CIGA claimed the WCAB’s jurisdiction continues to the extent that its failure to act on the petition within 60 days of its filing was due to the board's mistake or inadvertence, not CIGA’s own conduct.

The Shipley case held that the 60-day deadline in Section 5909 did not prevent the WCAB from exercising jurisdiction over a petition that had been lost or misplaced through no fault of the petitioner and due to circumstances entirely beyond his control.

More than nine months after CIGA filed its petition for reconsideration, the WCAB issued an order granting reconsideration to allow an opportunity for further study. The order also cited Shipley for the principle that an order granting the petition for reconsideration is timely if issued within 60 days of the WCAB receiving notice.

According to the WCAB, it did not receive CIGA’s petition until after the 60 days under Section 5909 had passed, due to an “administrative irregularity.” The WCAB also said petitions for reconsideration are usually filed in a district office or electronically and that staff must manually notify the board that reconsideration was being sought. As a result, transmission delays often occur because of “the nature" of the electronic system or “normal human error.”

In response to the WCAB’s grant-for-study order, Zurich filed a petition for a writ of mandate.

The Court of Appeal for the 2nd District of California explained that indicia of legislative intent to make a deadline jurisdictional include the provision of a consequence or penalty for failure to do the act within the time commanded.

The court said the language of Section 5909 contains such a provision, in that the statute says a petition will be deemed denied if it is not ruled on within 60 days. The appellate court added that the state Supreme Court “has held that statutory provisions stating that petitions or other requests to an agency are deemed denied by a specified date limit an agency’s jurisdiction, and decisions made after the deadlines are void as in excess of jurisdiction.”

The appellate court said Section 5909 does not require the WCAB to issue a final ruling on a petition for reconsideration within 60 days. Rather, Section 5906 envisions that the board may grant a petition for reconsideration and rule based on the evidence previously submitted in the case or elect to grant reconsideration and then direct the taking of additional evidence, the court said.

“But the plain language of Section 5909 and its legislative history make clear what the board cannot do — ignore the 60-day deadline and then rule on the petition for reconsideration — because after 60 days, the board no longer has jurisdiction to consider the petition,” the court said.

Accordingly, the court said, the WCAB acted in excess of its jurisdiction in granting CIGA’s petition after it was deemed denied under Section 5909.

Assuming that an exception to the 60-day deadline in Section 5909 may be carved out based on equitable principles, the court added, it "must be limited to the circumstances, as in Shipley, where a petitioner acts diligently to protect his or her rights, and the board misleads the petitioner into believing the board would consider the petition after the 60-day deadline had passed, thereby depriving the claimant of review by the board (and potentially any judicial review).”

To read the court’s decision in Zurich American Insurance Co. v. WCAB (CIGA), No. B321864, 12/18/2023, published, click here.