* Board Of Industrial Insurance Appeals, Appellant V. South Kitsap School Distict, Et Al., Respondents

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FILED
COURT O APPEALS
DIVISION 11
201111i/ 0' 20 fii110: 513
IN THE COURT OF APPEALS OF THE STATE OF WASHINGTON
DIVISION II
BOARD OF INDUSTRIAL INSURANCE No. 43688 -4 -II
APPEALS,
Appellant,
PUBLISHED OPINION
v.
SOUTH KITSAP SCHOOL DISTRICT;
DANIEL B. ZIMMERMAN; and
DEPARTMENT OF LABOR &
INDUSTRIES,
Respondents.
BJORGEN, J. — Under legislation adopted in 2011, injured workers may waive certain
lifetime workers' compensation benefits in exchange for a series of installment payments. This
is accomplished by negotiating a claim resolution structured settlement agreement ( CRSSA) with
the Department of Labor and Industries or self-insured employers and obtaining approval by the
Board of Industrial Insurance Appeals ( Board).
In this appeal the Board challenges a superior court order that reversed the Board' s
decision to reject a CRSSA between the workers' compensation trust for South Kitsap School
 	 	 	 	 	 	 	 	 	 	 	 	 	

No. 43688 -4 -I1
District, a self -insured employer, and Daniel Zimmerman, a worker injured in the course of his
employment with the District. The Board rejected the CRSSA because it could not determine
from the information provided whether it was in Zimmerman' s best interest. The District
appealed the Board' s decision to superior court, arguing that, because an attorney represented
Zimmerman in the negotiations, the Board should not have considered whether the CRSSA was
in Zimmerman' s best interest. We hold that the statute, as written, does not permit the Board or
its hearing examiner to reject a proposed CRSSA for a worker represented by an attorney
because they deem it not to be in the worker' s best interest. Therefore, we affirm the superior
court.
FACTS
In February 2012 Zimmerman and the District entered into a CRSSA in which
Zimmerman forfeited the right to receive future disability benefits in exchange for a series of
seven monthly payments totaling $60,000. The CRSSA concerned a claim Zimmerman had filed
in 1991 after suffering a low back injury. By April 2011 Zimmerman had received
approximately 19 years of time loss compensation benefits for that injury.
The three- member Board rejected the CRSSA by a vote of two to one,' because it could
not determine whether the CRSSA met the requirements under RCW 51. 04. 063( 3)( b).
Specifically, the majority stated that
a] s part of that determination, we believe we must evaluate whether the [ CRSSA]
1
The dissenting Board member expressed the view, also taken by the superior court, that the
statute did not allow the Board to consider the best interest of the injured worker in evaluating a
CRSSA submitted by a worker represented by an attorney.
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No. 43688 -4 -II
is in the best interest of the worker. We are unable to make that determination
based on the information that has been provided to us.
Clerk' s Papers ( CP) at 20.
The decision made clear that the parties could resubmit the same CRSSA if they provided
certain additional information. The majority described the apparent inadequacy of the CRSSA
and explained what additional infollnation it needed in the following terms:
According to the [ CRSSA], the self-insured employer paid Mr. Zimmerman
almost 19 years of time loss compensation benefits through April 2011. The
parties have provided no explanation for why those benefits were terminated at
that point. From the information provided, we cannot ascertain whether there is a
genuine dispute, based on specific opposing medical or vocational opinions,
regarding Mr. Zimmerman' s entitlement to continuing total disability benefits. If
there is such a dispute, that might explain why he is willing to relinquish a claim
for such benefits in exchange for $60,000. We should be provided the estimate of
the value of the claim or the pension reserve. Mr. Zimmerman must be aware of
the potential benefits he forfeits by entering into this [ CRSSA]. Alternatively, if
he now has some other source of income to support him or anticipates a reduction
in his compensation rate as a result of receiving other benefits, perhaps that would
explain why this settlement is in his best interest. But without further
information, we cannot say it would be in his best interest to forego total
disability benefits in light of his life expectancy, particularly with such a rapid pay
out and no explanation of how Mr. Zimmerman will support himself thereafter.
CP at 22. Zimmerman was born July 31, 1956, had an estimated life expectancy of 24.01 years
at the time of the CRSSA, and was single with one child. Thus, the majority was concerned that
60,000 would not cover Zimmerman' s living expenses for the remainder of his life and,
consequently, would not be in his best interests.
The District appealed the Board' s decision to the Kitsap County Superior Court. On its
motion for summary judgment, the District argued that the statute unambiguously precludes the
Board' s consideration of a represented worker' s best interest and that the Board may not .
substitute its own opinion for that of the worker' s attorney.
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No. 43688 -4 -II
After hearing argument from Zimmerman, the Board, the Department of.Labor and •
Industries, and the Washington Labor Council, the superior court granted the District' s motion.
The court entered an order reversing the Board' s decision and remanding the matter " to the
Board to review the agreement under RCW 51. 04.063( 3) with the caveat that subsection ( 3)( b)
does not include a finding of best interest of the worker but only those requirements that apply to
all CRSSAs." CP at 104. The Board timely appeals.
ANALYSIS
The conclusive issue in this appeal is whether the Board may consider the best interest of
the worker in evaluating a CRSSA submitted by a worker represented by an attorney.
Concluding that the statute unambiguously removes that consideration from the Board' s reach
when the worker is represented by an attorney, we affirm the superior court.
I. STANDARD OF REVIEW
We review the Board' s interpretation of a statute de novo under the ' error of law '
standard, which allows us to substitute our own interpretation for that of the Board. Roller v.
Dep' t ofLabor & Indus., 128 Wn. App. 922, 926 -27, 117 P. 3d 385 ( 2005) ( quoting Cobra
Roofing Serv., Inc. v. Dep' t of Labor & Indus., 122 Wn. App. 402, 409, 97 P. 3d 17 ( 2004)). In
this context, however, we " give substantial weight to the agency' s interpretation of statutes and
regulations within its area of expertise" and " will uphold an agency' s interpretation ... if `it
reflects a plausible construction of the language of the statute and is not contrary to the
legislative intent.'" Cobra Roofing, 122 Wn. App. at 409 ( quoting Seatoina Convalescent Ctr. v.
Dep' t of Soc. & Health Servs., 82 Wn. App. 495, 518, 919 P.2d 602 ( 1996)); St. Francis
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No. 43688 -4 -II
Extended Health Care v. Dep' t of Soc. & Health Servs., 115 Wn.2d 690, 695, 801 P. 2d 212
1990).
In interpreting a statute, an appellate court' s " fundamental objective is to ascertain and
carry out the Legislature' s intent, and if the statute' s meaning is plain on its face, then the court
must give effect to that plain meaning as an expression of legislative intent." Dep' t of Ecology v.
Campbell & Gwinn, LLC, 146 Wn.2d 1, 9 -10, 43 P. 3d 4 ( 2002). We derive the plain meaning
from all that the Legislature has said in the statute and related statutes which disclose legislative
intent about the provision in question." Campbell & Gwinn, 146 Wn.2d at 11 - 12. That is,
t]he meaning of words in a statute is not determined from those words alone but
from all the terms and provisions of the act as they relate to the subject of the
legislation, the nature of the act, the general object to be accomplished and
consequences that would result from construing the particular statute in one way
or another.
In re Custody of E.A. T.W., 168 Wn.2d 335, 343 -44, 227 P. 3d 1284 ( 2010) ( internal quotation
marks omitted). If "the statute remains susceptible to more than one reasonable meaning" after
consideration of all relevant statutory language, it "is ambiguous and it is appropriate to resort to
aids to construction, including legislative history." Campbell & Gwinn, 146 Wn.2d at 12.
II. THE BEST INTEREST OF THE WORKER IN THE CRSSA STATUTE AND REGULATIONS
In 2011 the legislature made extensive modifications to industrial insurance law, codified
in Title 51 RCW. LAWS OF 2011, ch. 37, § 1. Among these, a new statute, RCW 51. 04.063,
authorized certain injured workers receiving benefits to negotiate structured settlements, or
CRSSAs, in which they would forfeit remaining benefits in return for a specific sum payable in
installments. Before this legislation, any agreement purporting to waive workers' compensation
benefits was void as a matter of law. RCW 51. 04.060.
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No. 43688 -4 -II
The purpose of the new statute is captured in the legislative findings set out in RCW
51. 04.062:
Washington state' s workers' compensation system should be designed to focus on
achieving the best outcomes for injured workers. Further, the legislature
recognizes that controlling pension costs is key to a financially sound workers'
compensation system for employers and workers. To these ends, the legislature
recognizes that certain workers would benefit from an option that allows them to
initiate claim resolution structured settlements in order to pursue work or
retirement goals independent of the system, provided that sufficient protections
for injured workers are included.
The statement of purpose in the session laws speaks of a similar rationale. See LAws OF 2011,
ch. 37, § 1. These findings make plain that " achieving the best outcomes for injured workers"
remains the " focus" of the system and that controlling pension costs is valued to the extent it
serves that end.
The new statute includes a number of safeguards aimed at preventing injured workers
from unwisely waiving their benefit entitlements: only workers over a specified age ( currently
55, but declining to 50 by 2016) may enter into CRSSAs; parties may initiate a CRSSA no
sooner than 180 days after issuance of a final order allowing the claim at issue; workers may not
waive medical benefits under a CRSSA; and workers must submit all CRSSAs for Board
approval. RCW 51. 04.063( 1), ( 2)( a). Further, any party may revoke its consent to the CRSSA
by notifying the Board and the other parties in writing within 30 days following the Board' s
approval of the CRSSA. RCW 51. 04.063( 6).
The statute also provides an additional layer of protection for workers not represented by
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No. 43688 -4 -II
a lawyer. RCW 51. 04.063( 2)( h) -(l). In those circumstances the parties must submit the
proposed CRSSA to the Board along with a request for a conference with an industrial appeals
judge (IAJ), who must approve the CRSSA before the Board considers it further. RCW
51. 04.063( 2)( h). The IAJ must ensure that the worker understands the terms of the CRSSA, the
benefits generally available under the workers' compensation system, and the consequences of
entering into a CRSSA.. RCW 51. 04.063( 2)( h), ( i). The IAJ may approve the CRSSA only " if
the judge finds that the agreement is in the best interest of the worker." RCW 51. 04.063( 2)( j).
In making this determination, the IAJ must consider:
i) The nature and extent of the injuries and disabilities of the worker;
ii) The age and life expectancy of the injured worker;
iii) Other benefits the injured worker is receiving or is entitled to receive and
the effect a [ CRSSA] might have on those benefits; and
iv) The marital or domestic partnership status of the injured worker.
RCW 51. 04.063( 2)( j)( i) -(iv). The statute does not specify whether this list is exclusive or
whether the IAJ may consider other factors in the best -interest analysis. It explicitly provides,
however, that "[ t] here is no appeal from the [ IAJ]' s decision." RCW 51. 04.063( 2)( k).
Whether or not the worker has legal representation, the parties must submit the CRSSA
to the Board for its approval. RCW 51. 04. 063( 2)( l), (4). The statute provides that the Board
shall" approve the CRSSA within 30 days unless it finds one of five enumerated defects:
a) The parties have not entered into the agreement knowingly and willingly;
b) The agreement does not meet the requirements of a [ CRSSA];
c) The agreement is the result of a material misrepresentation of law or fact;
d) The agreement is the result of harassment or coercion; or
e) . The agreement is unreasonable as a matter of law.
RCW 51. 04.063( 3)( a) -( e). Thus, the statute plainly limits the discretion of the Board to reject a
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No. 43688 -4 -II
CRSSA to these specific grounds.
The 2011 legislation also directed the Board to " adopt rules as necessary to implement"
the law. LAws OF 2011, ch. 37, § 305. The Board accordingly promulgated a rule governing the
contents of CRSSAs at WAC 263 -12 -052, requiring that all CRSSAs contain:
6) The nature and extent of the injuries and disabilities of the worker
and the conditions accepted and segregated in the claim;
7) The life expectancy of the worker;
8) Other benefits the worker is receiving or is entitled to receive and
the effect that a claim resolution structured settlement agreement may have on
those benefits;
9) The marital or domestic partnership status of the worker[.]
These elements correspond to those specified in the statute for an IAJ' s best- interest
determination. RCW 51. 04.063( 2)( j)( i) -(iv).
In sum, these statutes purport to serve the interests of injured workers by authorizing
them to exchange their continuing workers' compensation benefits for a structured settlement: a
negotiated sum paid out in installments. As noted, the legislation contains a number of
measures, applicable to all workers, designed as a curb against unwise decisions: only workers
over a set age may choose a structured settlement, only claims of a certain age may be settled,
medical benefits may not be waived, and any party may void a structured settlement within 30
days after Board approval. RCW 51. 04.063.
The legislation, understandably, guards even more the interests of workers without legal
representation. They may exchange their benefits for a structured settlement only if an IAJ finds
that the CRSSA is in the best interest of the worker after considering explicit criteria designed to
examine that interest. In contrast, the statute is wholly void of any requirement that workers with
legal counsel convince the state that a structured settlement is in their best interests. In fact, only
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No. 43688 -4 -II
before the IAJ does the statute require consideration of the worker' s interests, and only workers
without legal counsel go before the IAJ when proposing a CRSSA. Those with attorneys
proceed directly to the Board, which judges proposed settlements under five express criteria,
none of which require consideration of the worker' s best interests. RCW 51. 04.063( 3)( a) -( e).
Whether we apply the canons of construction in determining whether a statute is
ambiguous, see Campbell & Gwinn, 146 Wn.2d at 12, the rules articulated in that case and in
E.A. T.W., 168 Wn.2d at 343 -44; allow us to 'determine a statute' s meaning by considering all of
its terms as they relate to its subject. In doing so, the differing treatment of different classes may
throw the intended effect of the text into sharper relief. The statutory text before us extends
certain safeguards to all workers, but only for those without counsel does it require the state to
determine that the settlement is in their best interest. This approach assigns the determination of
one' s own interest to those arguably best positioned to make that determination, workers with
legal counsel. Inversely, it removes the same determination from those arguably most in need of
an independent review of their own interests, those without counsel. Whether we think it better
policy for the state to determine the best interests of all CRSSA applicants is beside the point.
The legislature has adopted a detailed, rational scheme in which the state decides whether a
structured settlement is in the interests of workers without legal counsel. The inclusion in WAC
263 -12- 052( 6) -( 9), which applies to all CRSSA applicants, of criteria touching on the worker' s
interest cannot override the statute' s limitation of that inquiry to workers without legal counsel.
By asking us to approve that inquiry for all workers, the Board asks us to take a seat in the
legislative chambers, an invitation we must decline.
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The superior court was correct in reversing the Board' s decision and remanding to the
Board with instructions to make its decision without considering whether the CRSSA was in
Zimmerman' s best interest. Therefore, we affirm the decision of superior court.
We concur:
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