Esther Briones Parral v. The Cleaning Auth. and Zurich N. Am., No. WC22-6496 (March 21, 2024)
Zurich North America (“Zurich”) petitioned the Court of Appeals to vacate and set aside the default awards of workers’ compensation benefits and attorney’s fees pursuant to Minn. Stat. § 176.461. The Court found mutual mistakes of fact in the record and granted the petition. An award may be set aside “for cause.”, and under Minn Stat. § 176.461 (b), “for cause” includes a mutual mistake of fact, among a limited number of other items.
In this case, Zurich argued that the findings and order determining attorney’s fees should be set aside and vacated because Zurich did not provide workers’ compensation liability coverage for The Cleaning Authority on October 8, 2021. The parties agreed that on October 8, 2021, the Employee’s proper employer was M & M Business Enterprises, and not The Cleaning Authority, which was used on the Claim Petition, the pleadings, the findings and order, and the award on attorney’s fees. Further, the parties also agreed that M & M Business Enterprises was not insured for workers’ compensation liability by Zurich and, in fact, lacked workers’ compensation coverage in Minnesota entirely on October 8, 2021. There was no attempt by any party to amend the pleadings to indicate the proper employer and insurer prior to the issuance of the orders or the petition to vacate filed by Zurich. The Court found that mutual mistakes of fact existed regarding the identity of the Employer and the Insurer at the time of the injury on October 8, 2021.
Fundamental fairness is the overriding principle when determining whether to set aside an award. However, unfairness is not sufficient in and of itself to provide cause to vacate. Here, the Employee was a passenger in a car driven by her boss when she sustained a work injury arising out of and in the course of her employment. Since her injury, the Employee had been unable to pursue her claim either quickly or efficiently, and instead had been subjected to years of cyclical litigation as a result of the mutual mistakes of fact. Given the unwarranted litigation the parties created in this matter, the need for the injured employee to quickly and efficiently pursue her claim, and the discovery of pertinent facts after the issuance of the awards, basic fairness dictated that the awards at issue be vacated.
Finding good cause, the Court granted Zurich’s petition to set aside the award of benefits and vacated the findings and order dated September 2, 2022, and order determining attorney fees dated November 1, 2022.
Takeaway: When a party necessary to a claim is misapprehended during legal proceedings, is not represented during the process of the claim, and has no chance to be heard, the findings and order resulting from that claim must be vacated.