Livingstone v. A-R Cable Services
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MAINE SUPREME JUDICIAL COURT					Reporter of Decisions
Decision:	2000 ME 18
Docket:	WCB-98-694 & Ken-99-388
Argued:	December 7, 1999
Decided:	February 4, 2000

Panel:WATHEN, C.J., and CLIFFORD, RUDMAN, DANA, SAUFLEY, ALEXANDER, and
CALKINS, JJ.

ERNEST LIVINGSTONE

v.

A-R CABLE SERVICES OF MAINE et al.

CLIFFORD, J.

	[¶1] The Travelers Insurance Company, one of the insurers for the
employer A-R Cable Services of Maine, appeals from a decision of the
Superior Court, (Kennebec County, Studstrup, J.), vacating an
apportionment decision of an arbitrator appointed pursuant to 39-A M.R.S.A.
§ 354 (Supp. 1998).{1}  The same decision of the arbitrator is also before us
via a different avenue, namely a petition for appellate review pursuant to
39-A M.R.S.A. § 322 (Supp. 1999).  The petition for appellate review was
brought by A-R Cable Service, through its insurer, Commercial Union
Insurance Company.  We have consolidated that petition with the appeal
from the Superior Court.  Because we conclude that the proper avenue to
seek appellate review of a section 354 apportionment decision of the Bureau
of Insurance is an appeal to the Superior Court pursuant to M.R. Civ. P. 80C,
we dismiss Commercial Union's 39-A M.R.S.A. § 322 appeal.  Concluding
that the arbitrator did not exceed his authority in its decision apportioning
liability between the insurers pursuant to 39-A M.R.S.A. § 354 (Supp. 1998),
amended by P.L. 1999, ch. 354, § 9 (Pamph. 1999) (effective September 18,
1999), we vacate the decision of the Superior Court and remand for entry of
a judgment affirming the arbitrator.

I.

	[¶2]  The employee, Ernest Livingstone, suffered three work-related
neck and shoulder injuries while employed as a line technician for A-R
Cable.  The first injury occurred in 1991, during a time when Travelers was
the insurer for A-R Cable.  Livingstone's second work related injury took
place in 1992 when Commercial Union was A-R Cable's insurer.  Livingstone
was injured a third time, in 1993, when Maine Employers' Mutual Insurance
Co. (MEMIC) was the insurer.  The insurers disputed which of the injuries
were responsible for Livingstone's incapacity and the benefits paid to him.
	[¶3]  Apportionment of liability between insurers is governed by
39-A M.R.S.A. § 354.  The applicable version of section 354 provides, in
pertinent part:

	1.  Applicability.  When 2 or more occupational injuries
occur, during either a single employment or successive
employments, that combine to produce a single incapacitating
condition and more than one insurer is responsible for that
condition, liability is governed by this section.

	2.  Liability to employee.  If an employee has sustained
more than one injury while employed by different employers, or
if an employee has sustained more than one injury while
employed by the same employer and that employer was insured
by one insurer when the first injury occurred and insured by
another insurer when the subsequent injury or injuries occurred,
the insurer providing coverage at the time of the last injury shall
initially be responsible to the employee for all benefits payable
under this Act.

	3.  Subrogation.  Any insurer determined to be liable for
benefits under subsection 2 must be subrogated to the
employee's rights under this Act for all benefits the insurer has
paid and for which another insurer may be liable.  Any such
insurer may, in accordance with rules adopted by the
Superintendent of Insurance, file a request for appointment of
an arbitrator to determine apportionment of liability among the
responsible insurers.  The arbitrator's decision is limited to a
choice between the submissions of the parties and may not be
calculated by averaging.  Within 30 days of the request, the
Superintendent of Insurance shall appoint a neutral arbitrator
who shall decide, in accordance with the rules adopted by the
Superintendent of Insurance, respective liability among or
between insurers.  Arbitration pursuant to this subsection is the
exclusive means for resolving apportionment disputes among
insurers and the decision of the arbitrator is conclusive and
binding among all parties involved.  Apportionment decisions
made under this subsection may not affect an employee's rights
and benefits under this Act.

39-A M.R.S.A. § 354 (Supp. 1998), amended by  P.L. 1999, ch. 354, § 9
(Pamph. 1999).
	[¶4]  In 1994, the insurers sought an arbitration before the Bureau of
Insurance and a neutral arbitrator was appointed pursuant to section 354(3). 
In 1995, however, prior to the arbitration, the parties agreed to proceed
before the Board with petitions related to the 1991, 1992, and 1993
injuries.  In 1996, a hearing officer of the Board awarded Livingstone
protection of the Act for the 1991 injury, but did not find the 1991 injury
responsible for Livingstone's incapacity.  She found Commercial Union and
MEMIC equally responsible for that incapacity, and divided liability for
benefits equally between Commercial Union and MEMIC as a result of the
1992 and 1993 injuries.  The hearing officer completed her term prior to
responding to motions for further findings, however, and the parties agreed
to have the case reheard, de novo, before a new hearing officer. 
	[¶5]  Following the de novo hearing, the new hearing officer awarded
57% partial incapacity benefits for the period that Livingstone was out of
work immediately following the injury, and lower levels of partial incapacity,
thereafter, based on the difference between his post-injury and his
pre-injury earnings.   Pursuant to section 354, responsibility to pay all
benefits initially was placed with MEMIC as the insurer providing coverage
for the most recent injury.  The new hearing officer found further that the
three injuries "combined to produce an incapacitating condition at the time
of the employee's termination on May 11, 1994, and have continued to play
a causal role in periods of incapacity from that date to the present and
continuing."
	[¶6]  MEMIC again sought arbitration through the Bureau of Insurance
and, pursuant to section 354(3), an arbitrator was appointed by the
Superintendent of Insurance.  The insurers submitted proposals for
apportionment to the arbitrator pursuant to subsection 354(3).  The
submissions of MEMIC and Commercial Union provided that liability for
Livingstone's benefits be shared equally among the three insurers based on
the three injuries.  The submission of Travelers, however, proposed that
responsibility for the benefits being paid to Livingstone be divided equally
between the 1992 and 1993 injuries, with no liability being attributed to
Travelers for the 1991 injury.  The arbitrator issued a decision in December
of 1998 accepting Travelers's submission that responsibility should be split
50/50 between MEMIC and Commercial Union.  The arbitrator issued a
second "Supplemental Arbitration Decision" in January of 1999, reaffirming
his prior decision.  
	[¶7]  Uncertain of the proper avenue for appeal, Commercial Union
filed a petition for review of final agency action in the Superior Court
pursuant to M.R. Civ. P. 80C, and a motion to vacate the arbitrator's decision
pursuant to 14 M.R.S.A. § 5938.  Commercial Union also filed a petition for
appellate review in the Law Court pursuant to 39-A M.R.S.A. § 322
(Pamph. 1998).
	[¶8]  The Superior Court granted the motion to vacate the arbitrator's
decision, concluding that  

[t]he problem with the arbitrator's award in question is that it
appears to overturn a finding by the Workers' Compensation
Board that all three insurers had some responsibility for
payment.  In doing so, the arbitrator violated the principles set
forth in Rosetti v. Land Reclamation, 704 A.2d 312, 315 (Me.
1997), that the arbitrator may not enter into a factual
determination of contributive fault.  Although the court's review
is narrow, it concludes that the arbitrator's award did exceed his
authority and that the award should be vacated and remanded for
rehearing.

Travelers brought this appeal from the decision of the Superior Court
vacating the arbitrator's decision.  We also granted Commercial Union's
petition for appellate review pursuant to 39-A M.R.S.A. § 322 in order to
resolve the issue of the appropriate procedure for appeal from an
arbitrator's decision following a proceeding conducted pursuant to section
354, before its recent amendment assigning responsibility for deciding
apportionment to the Workers' Compensation Board.

II.

	[¶9]  We conclude that the proper avenue of appeal from a Bureau of
Insurance arbitration decision is the Administrative Procedure Act,
5 M.R.S.A. § 11001, et seq. (A.P.A.) (1989 & Pamph. 1999) and
M.R. Civ. P. 80C.  In 39-A M.R.S.A. § 354, the Legislature delegated authority
to the Superintendent of the Bureau of Insurance to conduct arbitration
proceedings to apportion liability between insurers in workers'
compensation cases.  Title 24-A M.R.S.A. § 236 provides that appeals from
actions taken by the Bureau of Insurance "shall occur in []conformity with"
the Maine Administrative Procedure Act, Title 5, chapter 375, subchapter
VII [5 M.R.S.A. § 11001, et seq. (1989 & Pamph. 1999)]."{2}  Rule 80C
governs procedure applicable to administrative appeals brought pursuant to
the Administrative Procedure Act.  Section 11001(1) of the A.P.A., applicable
to adjudicatory proceedings, provides:

Except where a statute provides for direct review or review of a
pro forma judicial decree by the Supreme Judicial Court or
where judicial review is specifically precluded or the issues
therein limited by statute, any person who is aggrieved by final
agency action shall be entitled to judicial review thereof in the
Superior Court in the manner provided by this subchapter. 
Preliminary, procedural, intermediate or other nonfinal agency
action shall be independently reviewable only if review of the
final agency action would not provide an adequate remedy.  

5 M.R.S.A. § 11001(1).
	[¶10]  The arbitrator's apportionment decision pursuant to section
354 is an "adjudicatory proceeding."  See 2 Kenneth Culp Davis & Richard J.
Pierce, Jr., Administrative Law Treatise, §§ 6.1, 8.1 (3rd Ed. 1994).  The
A.P.A. defines an "adjudicatory proceeding" as "any proceeding before an
agency in which the legal rights, duties or privileges of specific persons are
required by constitutional law or statute to be determined after an
opportunity for a hearing."  5 M.R.S.A. § 8002(1) (1989).  The arbitration in
this case involved the legal rights of specific individuals, and is therefore
distinguishable from rulemaking.{3}  Moreover, the sole responsibility of the
Bureau of Insurance pursuant to subsection 354(3) is to appoint an
arbitrator, who issues an arbitration decision.  Since there is no further
action expected from the Bureau, and no further administrative review
available, the arbitration decision was final agency action and is appealable to
the Superior Court.

III.

	[¶11]  Commercial Union and MEMIC contend that, because the Board
found that all three injuries contributed to Livingstone's ongoing incapacity,
the arbitrator lacked authority to accept a proposal submitted by one of the
parties that relieved an insurer at the time of one of those injuries of
responsibility for the employee's ongoing condition.  They suggest that, if
the arbitrator had accepted a proposal attributing just one percent
responsibility for Livingstone's condition to the 1991 injury, then such a
decision by the arbitrator would not have been in excess of its authority. 
They contend, however, that the arbitrator lacked authority to adopt a
submission assigning no responsibility to the 1991 injury.  We disagree.  
	[¶12]  The standard for determining whether an arbitrator exceeded
his authority is "an extremely narrow one."  AFSCME Council 93 v. City of
South Portland, 675 A.2d 100, 102 (Me. 1996); see also Maine Cent. R. Co.
v. Bangor & Aroostook R.R. Co., 395 A.2d 1107, 1122 (Me. 1978).  Section
354(3) grants authority to the Superintendent of Insurance to determine
apportionment from among the submissions of the parties, and there is
little for a reviewing court to judge.
	[¶13]  As we stated in Rosetti v. Land Reclamation, 704 A.2d 312, 315
(Me. 1997), the arbitrator "is limited to a choice between apportionment
proposals submitted by the insurers."  It is quite conceivable that in some
cases none of the apportionment proposals submitted by the insurers would
be completely consistent with the findings of fact made by the Board.   
Travelers' submission did not strictly comport with findings made by the
Board, but we cannot say that the Travelers' proposal does not reflect a
division of responsibility for the injuries that is closer to reality.  Travelers'
proposal may more closely reflect which of the injuries actually contributed
to the incapacitating condition suffered by Livingstone, and may be a
"better" proposal than the alternative submissions, both of which
apportioned responsibility equally among all three insurers.  The fact that,
from among the proposals submitted to it, the arbitrator selected a proposal
that did not conform strictly to the findings of the Board does not, in this
case, under our very limited scope of review, compel us to conclude that the
arbitrator exceeded his authority.
	The entry is:

The appeal from the arbitrator's decision
pursuant to 39-A M.R.S.A. § 322 is dismissed. 
Judgment of the Superior Court vacated. 
Remanded to the Superior Court with
instructions to enter judgment affirming the
arbitrator's decision.

Attorney for employee:

Joseph T. Walsh Jr., Esq.
6 State Street
Bangor, ME 04401

Attorneys for employers and insurers:

Stephen J. Burlock, Esq., (orally)
Weatherbee, Woodcock, Burlock & Woodcock, P.A.
P O Box 1127
Bangor, ME 04402-1127
(for Maine Employers' Mutual Ins. Co.)

Christopher J. Cotnoir, Esq., (orally)
Ronald A. Ducharme, Esq.
Wheeler & Arey, P.A.
P O Box 376
Waterville, ME 04903-0376
(for Commercial Union York Ins. Co.)

Sheilah R. McLaughlin, Esq., (orally)
Douglas, Denham, Buccina & Ernst
P O Box 7108
Portland, ME 04112-7108
(for Travelers Ins. Co.)

FOOTNOTES******************************** {1} . Title 39-A M.R.S.A. § 354 has been recently amended to remove reference to and the authority of the Bureau of Insurance to decide apportionment. The statute now vests that authority to determine apportionment in the Board. See P.L. 1999, ch. 354, § 9 (codified at 39-A M.R.S.A. § 354 (Pamph. 1999)) (effective September 18, 1999). None of the parties have argued that the recently amended statute applies to the present appeal. {2} . Section 236 provides: § 236. Appeal from the superintendent 1. In general, judicial review of actions taken by the superintendent or his representatives shall occur in[]conformity with the provisions set forth in the Maine Administrative Procedure Act, Title 5, chapter 375, subchapter VII [14 M.R.S.A. § 11001, et seq.]. 2. An appeal from the superintendent shall be taken only from an order on hearing, or as to a matter on which the superintendent has failed to hold a hearing after application thereof under section 229, or regarding a matter as to which the superintendent has failed to issue an order after hearing as required by section 235. 3. Any person who was a party to the hearing may appeal from an order of the superintendent within 30 days after receipt of notice. Any person not a party to the hearing whose interests are substantially and directly affected and who is aggrieved by an order of the superintendent may appeal within 40 days from the date the decision was rendered. If the appeal is taken from the superintendent's failure or refusal to act, the petition for review shall be filed within 6 months of the expiration of the time within which the action should reasonably have occurred. 24-A M.R.S.A. § 236 (1989). {3} . The A.P.A. expressly excludes adjudicatory decisions of the Board from application of the A.P.A. provisions governing adjudicatory proceedings. Title 5 M.R.S.A. § 9051(1) delineates the scope of the adjudicatory proceedings subchapter, and provides that, "[i]n any adjudicatory proceedings, except those proceedings involving correctional facilities, the Workers' Compensation Board or the State Parol Board, the procedures of this subchapter apply." 5 M.R.S.A. § 9051(1) (Pamph. 1999) (emphasis added). See Kuvaja v. Bethel Sav. Bank, 495 A.2d 804, n. 3 (Me. 1985). Arbitration in this case is not an adjudicatory proceeding of the Board, but of the Bureau of Insurance, and is therefore not excluded from the application of the A.P.A.