April 9, 2019- Rodolfo Barrozo, Jr. v. Albertson’s Inc., No. A-1-CA-36197

1 	IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO
2 RODOLFO BARROZO, JR.,
3 	Worker-Appellant,
4 v. 	No. A-1-CA-36197
5 ALBERTSON'S, INC. and ACE
6 AMERICAN INSURANCE COMPANY,
7 	Employer/Insurer-Appellees.
8 APPEAL FROM THE WORKERS' COMPENSATION ADMINISTRATION
9 Shanon S. Riley, Workers' Compensation Judge
10 Gerald A. Hanrahan
11 	Albuquerque, NM
12 for Appellant
13 	Butt, Thornton & Baehr, P.C.
14 Rheba Rutkowski
15 	Neysa E. Lujan
16 Albuquerque, NM
17 for Appellees
18 	MEMORANDUM OPINION
19 M. ZAMORA, Chief Judge.
20 	{1} 	Rodolfo Barrozo, Jr. (Worker) appeals from the Workers' 	Compensation
21 	Judge's (WCJ) order denying his motion for summary judgment and the amended
22 compensation order entered following a trial on the merits. Worker argues that (1)
Court of Appeals of New Mexico
Filed 4/9/2019 8:31 AM
Mark Reynolds

1 the parties reached a binding settlement agreement at the mandatory mediation, and
2 the WCJ erred in finding that the agreement was not enforceable; and (2) the WCJ
3 erred in determining that Worker suffers a 20 percent partial loss of use to each of
4 his elbows. We hold that the WCJ erred in failing to enforce the settlement
5 agreement reached by the parties at the mandatory mediation. We therefore reverse
6 and remand with instructions to vacate the amended compensation order and enter a
7 second 	amended 	compensation 	order 	consistent 	with 	the 	parties' 	settlement
8 agreement. Accordingly, we need not consider the second issue relating to Worker's
9 loss of use.
10 BACKGROUND
11 	{2} 	Worker is employed by Albertsons, Inc. as a meat cutter. ACE American
12 	Insurance Company is Albertson's insurance carrier, and we refer to Albertson's and
13 	ACE collectively as Employer. Worker _developed carpal tunnel syndrome in both
14 of his wrists and lateral epicondylitis in both of his elbows as a result of the repetitive
15 	movements involved with his job duties. There is no dispute in this case that Worker
16 was injured within the course and scope of his employment with Employer. Worker
17 has an unrelated medical condition, which necessitates that he continue to work full
18 time in order to maintain health insurance benefits, and he continues to work full
19 time as a meat cutter for Employer.
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1 {3} 	Worker's health care providers determined that his condition would not
2 improve so long as he continued to work as a meat cutter, and that he would likely
3 need surgery to correct the condition. Worker elected not to have surgery, however,
4 because his pain would likely return after the surgery if he returned to. meat cutting
5 and because he would lose his health insurance benefits given the long recovery
6 period as a result of the surgery. Though he takes medications and has tried multiple
7 therapies intended to help alleviate his work-related pain, Worker continues to
8 experience constant stabbing or throbbing pain in his wrists and elbows. Worker
9 testified that he has to work forty hours per week so that he does not risk getting his
10 hours cut to the point where he suffers financial hardship or loses his health
11 	insurance benefits.
12 Mandatory Mediation
13 	{4} 	After Worker filed 	his complaint against Employer with the 	Workers'
14 Compensation Administration (WCA), the parties engaged in mandatory mediation
15 	as 	required 	by 	NMSA 	1978, 	Section 	52-5-S(C) 	(2013) 	of 	the 	Workers'
16 Compensation Administration Act (the Act), NMSA 1978, §§ 52-5-1 to -22 (1986,
17 as 	amended 2013). 	Worker, 	his 	attorney, 	the 	insurance 	claims 	adjuster, 	and
18 Employer's attorney were all present at the June 29, 2015 mediation, during which
19 the parties exchanged three offers of settlement through the Mediator. Employer
20 ultimately conveyed a "final offer" to pay Scheduled Injury (SI) benefits at 30
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1 percent for each of Worker's elbows, one for 160 weeks and the other for 155 weeks,
2 and 20 percent for each of Worker's wrists, one for 150 weeks and the other for 140
3 weeks. Worker accepted this "final offer" and the mediation ended. The parties did
4 not memorialize the agreement in writing or on the record.
5 {5} 	The next day, the Mediator filed his recommended resolution, pursuant to
6 Section 52-5-5(C), which stated:
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3. 	It is recommended that this case be resolved as follows:
The primary issue in this case is Worker's loss of
use due to the injuries to his bilateral upper extremities.
After full discussion and negotiations at the mediation
conference, the parties agreed that Worker is entitled to
loss of use/scheduled injury benefits at the rate of thirty
percent (30%) for his right elbow for a period of 160
weeks, thirty percent (3 0%) for his left elbow for a period
of 155 weeks, twenty percent (20%) for his right wrist for
a period of 150 weeks, and twenty percent (20%) for his
left 	wrist 	for 	a 	period 	of 	140 	weeks, 	beginning 	on
September 24, 2014, the date of the maximum medical
improvement. Employer/Insurer is entitled to a credit for
scheduled injury indemnity benefits paid to date. Worker
is 	entitled 	to 	a 	reasonable 	attorney[] 	fee, 	subject 	to
approval by a workers' compensation judge.
Medical benefits remain open. Both parties reserve
and retain all rights and defenses under [NMSA 1978,
Section] 52-1-49 [1991] of the Workers' Compensation
Act. Should the parties be unable to resolve any issue in
the 	future, 	then 	either 	party 	may 	file 	an 	amended
complaint with the accompanying documents required by
this 	Administration, 	even 	within 	six 	months 	of this
[r]ecommended [r]esolution.
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1 (Emphasis 	added.) 	Worker filed 	a notice 	of acceptance 	of the recommended
2 resolution, but Employer filed a notice of rejection of the recommended resolution,
3 stating that "[t]he [r]ecommended [r]esolution does not provide substantial justice
4 to the parties." The matter was assigned to a WCJ.
5 	Summary Judgment Proceedings
6 	{6} 	Worker filed a motion for summary judgment, arguing that the agreement
7 reached by the parties at the mandatory mediation created a binding, enforceable
8 contract. 1 In response, Employer argued that although an agreement was reached at
9 the mediation, it was only a "tentative" agreement, and that the parties could not be
10 bound by it until both parties either accepted the recommended resolution or failed
11 	to reject it within thirty (30) days of its issuance. Employer explained that it
12 considered the recommended resolution, and determined that because Worker was
13 	"back at work," 100 percent total loss of use compensation was not appropriate.
14 Employer argued that the thirty-day time period provided under the 	Act and
15 	accompanying regulations, which provides parties with the opportunity to either
1
Employer argues that it was improper for Worker to discuss the particulars
of the settlement negotiation with the WCJ, referring to Rule 11-408 NMRA, as
support for its argument. We disagree as Rule 11-408 only bars disclosure of
settlement offers as evidence that a party is liable for the claims at issue or to
impeach by a prior inconsistent statement or contradiction. See Rule 11-408(A);
Jesko v. Stauffer Chem. Co., 1976-NMCA-117, ~ 14, 89 N.M. 786, 558 P.2d 55
(recognizing where this is an acceptance of an offer that results in an enforceable
contract, subsequently one of the parties renounces the contract, the aggrieved party
may prove the offer, acceptance and surrounding circumstances).
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1 accept or reject the recommended resolution, is in place to allow parties to evaluate
2 the recommendation and determine whether it is in their best interest. Employer
3 further argued that this procedure is particularly important because the mandatory
4 mediation occurs before the parties have the opportunity to conduct full discovery
5 or fully evaluate the claims. The WCJ denied Worker's motion for summary
6 judgment, and the parties then proceeded to trial on the merits.
7 Trial on the Merits
8 {7} 	At trial, Worker again asked the WCJ to enforce the settlement agreement and
9 Employer, for its part, advanced the same arguments it made on summary judgment
10 to oppose enforcement of the settlement agreement. Worker testified that several
11 	offers went back and forth before Employer made a final offer that he accepted.
12 There were no conditions imposed on the offer. The mediation ended after he
13 	accepted 	Employer's 	offer. 	The 	insurance 	claims 	adjuster 	who 	attended 	the
14 mediation in Worker's case testified at trial. The claims adjuster could not remember
15 	anything about the mediation in this case but offered that she believed the parties
16 were 	not 	bound 	by 	any 	agreements 	until 	they 	filed 	an 	acceptance 	of the
17 recommended resolution.
18 	{8} 	The WCJ found that "the parties attend[ ed] a mediation conference. During
19 the mediation conference offers were exchanged and ultimately the parties reached
20 a tentative agreement." (Emphasis added.) Accordingly, the WCJ determined that
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1 the settlement agreement was not binding and issued a compensation order, which
2 was subsequently amended to correct a mistake in the benefit calculation. The
3 amended compensation order found that Worker was entitled to SI benefits at 20
4 percent for each elbow and 30 percent for each wrist. Worker appeals from the denial
5 of his motion for summary judgement and the amended compensation order.
6 DISCUSSION
7 {9} 	The issue before this Court is whether a binding agreement was reached
8 between the Worker and Employer at the mandatory mediation conference resolving
9 Worker's SI benefits claim. Worker asserts that the oral agreement reached at
10 mediation was a binding contract and that Employer should be bound to the terms
11 	of the settlement agreement despite its subsequent attempt to reject the agreement
12 memorialized in the Mediator's recommended resolution. Employer contends that
13 	although it made a "final offer" at mediation that Worker accepted, the agreement
14 was tentative 	because both parties had thirty days 	to 	review and reject the
15 	recommended resolution and both were required to 	accept the recommended
16 resolution before the agreement would be enforceable.
17 I. 	Standard of Review
18 	{to} 	Both parties make various arguments about whether the WCJ correctly denied
19 Worker's motion for summary judgment to enforce the settlement agreement
20 reached at the mandatory mediation. The issue that was the subject of the motion for
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1 summary judgment-i.e., whether a binding agreement was reached regarding
2 Worker's SI benefits during the mediation-also was a contested issue determined
3 at the trial on the merits. As such, we review the WCJ's resolution of this issue after
4 trial on the merits, not the WCJ's denial of summary judgment. See Green v. Gen.
5 Accident Ins. 	Co. of Am., 1987-NMSC-11 l, i1 19, 106 N.M. 523, 746 P.2d 152
6 (holding "a denial of a motion for summary judgment is not reviewable after final
7 judgment on the merits" and observing that "[i]f a summary judgment motion is
8 improperly denied, the error is not reversible for the result becomes merged in the
9 subsequent trial").
10 {11} 	We review the WCJ's factual findings under a whole record standard of
11 	review, Moya v. City of Albuquerque, 2008-NMSC-004, ,-r 6, 143 N.M. 258, 175
12 P.3d 926, giving deference to the WCJ as fact-finder where findings are supported
13 	by substantial evidence. SeeDeWittv. Rent-A-Ctr., Inc., 2009-NMSC-032, ,-r 12, 146
14 N.M. 453, 212 P.3d 341. The WCJ's application of the law to the facts is reviewed
15 	de novo. Ruiz v. Los Lunas Pub. Sch., 2013-NMCA-085, ,-r 5,308 P.3d 983. We also
16 apply a de novo standard of review to the extent that our analysis involves the
17 interpretation of workers' compensation statutes or regulations. See Ramirez v. IBP
18 Prepared Foods, 2001-NMCA-036, ,-r 10, 130 N.M. 559, 28 P.3d 1100 (stating that
19 	interpretation of a workers' compensation statute is a question of law to be reviewed
20 de novo), superseded by statute on other grounds as stated in Baca v. Los Lunas
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1 Cmty. 	Programs, 	2011-NMCA-008, 149 N.M. 	198, 246 P.3d 1070; 	Truong v.
2 Allstate Ins. Co., 2010-NMSC-009, ,r 24, 147 N.M. 583, 227 P.3d 73.
3 II. 	The WCJ's Determination That the Parties' Agreement Was Tentative
4 	Was In Error
5 	{12} 	Worker challenges the WCJ's finding that the settlement agreement was
6 "tentative." 	We 	tum 	to 	principles 	of contract 	law 	in 	reviewing 	the 	WCJ's
7 determination that there was no binding settlement agreement. See Herrera v.
8 Herrera, 	1999-NMCA-034, ,r 9, 	126 N.M. 705, 974 P.2d 675 ("All settlement
9 agreements are contracts and therefore are subject to contract law[.]"); see also
10 Sitterly v. Matthews, 2000-NMCA-037, ,r 15, 129 N.M. 134, 2 P.3d 871 (recognizing .
11 	that a settlement agreement is interpreted in the same way as any other contract).
12 {13} 	"The existence of a contract between parties is generally a question of law."
13 	See Garcia v. Middle Rio Grande Conservancy Dist., 1983-NMCA-047, ,r 22, 99
14 N.M. 802, 664 P.2d 1000, overruled on other grounds by Montoya v AKAL Sec.,
15 Inc., 1992-NMSC-056, 114 N.M. 354,838 P.2d 971. We review questions oflaw de
16 novo. See Rivera v. Am. Gen. Fin Servs., Inc., 2011-NMSC-033, ,r 27, 150 N.M.
17 398, 259 P.3d 803 ("Contract interpretation is a matter of law."). "Ordinarily, to be
18 	legally 	enforceable, 	a 	contract must 	be 	factually 	supported 	by 	an 	offer, 	an
19 acceptance, consideration, and mutual assent." See Garcia v. Middle Rio Grande
20 	Conservancy Dist., 	1996-NMSC-029, ,r 9, 	121 N.M. 728, 918 P.2d 7 (internal
21 	quotation marks and citation omitted).
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1 {14} 	The parties do not dispute that Employer made a "final offer" at the mediation
2 and that Worker accepted this offer, at which time the mediation concluded. Rather,
3 Employer disputes that its offer at the parties' mediation conference constituted an
4 enforceable contract once accepted.2 Thus, the narrow question before us is whether,
5 by their objective manifestations at the mediation, the parties intended to enter a
6 binding contract. See Pope v. Gap, Inc., 1998-NMCA-103, ~ 13, 125 N.M. 376, 961
7 P.2d 1283 (explaining "what is operative is the objective manifestation of mutual
8 assent by the 	parties, 	not their secret intentions"); 	see 	also Rojo 	v. 	Loeper
9 Landscaping, Inc., 1988-NMSC-065, ~ 5, 107 N.M. 407, 759 P.2d 194 (noting that
10 there is nothing in the Act that requires an agreement be in writing and so "an oral
11 	contract may be as binding as a written one").
2Employer spends significant time on its argument that the recommended
resolution was not binding on the parties because Employer timely rejected the
recommendation under Section 52-5-5 and its implementing regulations. Worker,
however, agrees with Employer that the recommended resolution is not binding.
Worker instead advances a different argument-that a separate binding agreement
was reached at the mediation and that Employer was not free to renege on this
separate agreement. Employer spends little time directly addressing this argument
and instead seems to suggest that Section 52-5-5, and its implementing regulations,
somehow preclude the parties from entering into. a binding settlement agreement
separate from the recommended resolution. To the extent Employer advances this
argument, 	it is 	not well-developed and we 	decline to 	address 	it. 	See Elane
Photography, LLC v. Willock, 2013-NMSC-040, ~ 70, 309 P.3d 52 ("We will not
review unclear arguments, 	or guess 	at what a party's arguments might be."
(alteration, internal quotation marks, and citation omitted)).
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1 {15} 	First, there was no evidence that the claims adjuster's objective manifestations
2 projected her otherwise private intention to 	make only a tentative 	settlement
3 agreement at the mediation conference. The claims adjuster had no recollection
4 whatsoever of the mediation with Worker and instead offered her personal beliefs
5 about the nature of the mediation process. Employer argues that the claims adjuster
6 understood "the mediation process to include a right to reject" the recommended
7 resolution, but Employer presented no evidence that it communicated, to either the
8 Worker, his attorney, or the Mediator, that its final offer was a tentative offer or
9 subject to any unstated contingency. Although counsel maintains that the Employer
10 understood the agreement to be tentative, the adjuster did not testify that she
11 	conveyed such an understanding to Worker. And, as indicated, the Employer's final
12 offer 	contained no 	conditional 	language 	that might raise 	questions 	as 	to 	its
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13 	legitimacy as a true settlement. In all, Employer points to no evidence to suggest that
14 Worker's acceptance of its offer was anything other than a "manifestation of
15 	unconditional agreement to all of the terms of the offer and an intention to be bound
16 thereby." Silva v. 	Noble, 	1973-NMSC-106, ,-r 6, 85 N.M. 677, 515 P.2d 1281
17 (internal quotation marks and citation omitted).
18 {16} 	Second, 	the 	Mediator's 	recommended 	resolution 	acknowledged 	and
19 memorialized that an agreement had been reached by the parties at the mediation:
20 "[a]fter full discussion and negotiations at the mediation conference, the parties
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1 agreed, that Worker is entitled" to specific SI benefits. It then set forth the Mediator's
2 recommendation on some remaining matters, including that Worker was entitled to
3 reasonable attorney fees subject to approval of the WCJ, and that medical benefits
4 remained open with both parties reserving and retaining their rights and defenses
5 under Section 52-1-49.
6 {17} 	Third, Employer had the option of ensuring the mediator's understanding of
7 or the mediator's language used in memorializing the purportedly tentative nature of
8 the 	parties' 	agreement 	resolving 	Worker's 	claims. 	See 	NMAC 	11.4.4.lO(F)
9 (10/1/14) (setting out process to amend recommended resolution). Indeed, in stating
10 its reasons for the rejection, the Employer indicated only that the recommended
11 	resolution did not provide substantial justice to the parties, with no mention of its
12 present claims that an agreement was not reached or was conditional or otherwise
13 	tentative.
14 	{18} 	In sum, Employer points to no objective evidence from which Worker could
15 	have known that the offer was intended to be conditional. See Pope, 1998-NMCA-
16 	103, 1 13 ("Mutual assent is based on objective evidence, not the private, undisclosed
17 thoughts of the parties."). Accordingly, we conclude that the mutual assent necessary
18 to form a binding contract was present, see id., 	and that the WCJ's contrary
19 determination that the agreement was "tentative" is not supported by substantial
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1 evidence. Because the parties formed a valid and enforceable oral contract, the
2 WCJ's findings and conclusions to the contrary are in error.
3 III. 	New Mexico's Public Policy Favors Settlement Agreements
4 	{19} 	Finally, we address Employer's argument that in holding that parties are
5 bound by their offers at mediation, the mediation effectively becomes a mechanism
6 to force settlement prematurely and goes against the underlying purpose of the Act.
7 Employer suggests in its answer brief that if employers do not settle at mediation,
8 they risk being bound by the mediator's subsequent recommended resolution unless
9 the employers can prove the dl.!tails of "what happened" at the mediation or litigate
10 "the words used" in the recommended resolution. We are unpersuaded by this
11 	argument. Although the parties are required to come to mediation prepared to discuss
12 settlement, we are unable to find any authority within the Act that mandates that the
13 	parties settle claims ·at the mediation stage and Employer points us to none. "Where
14 a party cites no authority to support an argument, we may assume no such authority
15 	exists." Curry v. Great Nw. Ins. Co., 2014-NMCA-031, ,r 28,320 P.3d 482.
16 	{20} 	We also disagree with Employer's characterization of the mediation process
17 as ineffective or unfair because it occurs early after the case is filed. First, we note
18 that the parties are required to exchange all of the information that they have about
19 a claim prior to the mediation. See ll.4.4.10(B)(3) NMAC (10/1/14) (stating that
20 "[t]he purpose of mandatory production is to ensure that the parties and the mediator
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1 have access to 	all pertinent information regarding the issues disputed in the
2 complaint"). While each party is required to attend the mediation conference
3 prepared to discuss settlement, they are by no means obligated to settle. NMAC
4 11.4.4.10(C)(7)(c) (10/1/14). One of the express purposes of a mediation conference
5 is "to bring the parties together and ... attempt to settle disputed issues." NMCA
6 1 l.4.4.10(C)(6)(a) (10/1/14) (emphasis added). Employer was certainly free to
7 discuss various settlement options during the mediation, decline to reach agreement,
8 wait for the Mediator's recommended resolution, and then decide whether to accept
9 or reject the proposed resolution on all issues. That is not what happened in this case.
10 Rather, Employer chose to tender a "final offer," which Worker accepted in return
11 	for resolving his claims, and, as. stated, the Employer is bound by the agreement.
12 	{21} 	To allow Employer to rescind the agreement under these circumstances would
13 	undermine the long-standing public policy of this state favoring the settlement of
14 disputed claims. See Navajo Tribe ofIndians v. Hanosh Chevrolet-Buick, Inc., 1988-
15 	NMSC-010, ,-r 3, 106 N.M. 705, 749 P.2d 90 ("[I]t is the policy of the law and the
16 	State of New Mexico to favor settlement agreements."); Ratzlaffv. Seven Bar Flying
17 Serv., Inc., 1982-NMCA-071, ,-r 21, 98 N.M. 159,646 P.2d 586'(''[W]e must ... bear
18 	in mind that the policy of our law is to favor amicable settlement of claims without
19 litigation 	when 	the 	agreements 	are 	fairly 	secured, 	are 	without 	fraud,
20 misrepresentation, 	or 	overreaching, 	and 	when 	they 	are 	supported 	by
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1 consideration."); Esquibel v. Brown Constr. Co., 1973-NMCA-11 l,, 17, 85 N.M.
2 487, 	513 	P.2d 	1269 ("It is the policy 	of the 	law to 	favor 	compromise 	and
3 settlement.").
4 	CONCLUSION
5 	{22} 	For the foregoing reasons, we reverse and remand with instructions to vacate
6 the amended compensation order and enter a second amended compensation order
7 consistent with the settlement agreement entered into by the parties at mediation.
8 	{23} 	IT IS SO ORDERED.
9
10
11 	WECONCUR:
12 	~l~13 	JE~~.ATTP,JiiWge
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