Thursday, June 8, 2017

Another OK Court Challenge

Oklahoma's workers' compensation system was back in the news recently. WorkCompWire reported that Governor Fallin named Megan Tilly to replace Robert Gilliland as Chair of OK's Workers' Compensation Commission. That appointment has been challenged in a lawsuit. WorkCompCentral has reported that an earlier (last year) Fallin Commissioner appointee, Jordan Russell, has been similarly challenged in a lawsuit filed by another "claimant's attorney." 

In October 2016, Governor Fallin reportedly requested current Chair Gilliland's resignation. Commissioner Gilliland declined to resign, but there was conjecture then that he would not be reappointed upon expiration of his term in 2017. That conjecture has come true. 

It is fair to say that Oklahoma's workers' compensation system has been challenged in recent years. Their statute was amended significantly in 2013. The most news-grabbing element of that legislation was the now famous Oklahoma Opt-Out, but other changes were also significant. Until 2013, Oklahoma workers' compensation benefit disputes were heard by a court system. In the 2013 reform, the legislature revamped that process, phased-out the court system, and transitioned to an administrative hearing process. 

The structure adopted in 2013 is not dissimilar from several other states. The Oklahoma workers' compensation system is now managed by three Commissioners. They are responsible for the regulatory system, including issues like carrier reporting, participant compliance, litigation rules and more. The Commission also hires and manages administrative law judges (ALJ), who have taken over the adjudication of disputes from the old court system (now called the "Court of Existing Claims"). And, the three Commissioners are also the primary appellate body, reviewing the decisions of the ALJs, which might thereafter nonetheless be appealed to the state courts. As with some other systems, there is no requirement that these (effectively) appellate judges/commissioners have any legal training whatever. 

Last year, when the Gilliland resignation was requested, the attorney now challenging Ms. Tilly perceived a "separation of powers problem" with Fallin's request, according to WorkCompCentral. At that time, there was some perception that Gilliland was being forced out "because of a decision by the commission." While the decision was not identified in either Fallin's resignation request or in Gilliland's response, many reportedly presumed that the dispute revolved around the Commission decision in Vasquez v. Dillards. The challenging attorney found Executive Branch management by the elected chief executive troublesome 

Vasquez was notable for two reasons. First, the Commission concluded that it, the Commission, acted as a "state court of competent jurisdiction." In the vast majority of jurisdictions, administrative bodies are not "courts," and therefore lack the inherent authority to make determinations regarding constitutional challenges. But, the Commission in Vasquez found such authority for itself in Oklahoma Statute 85A O.S. 211, which says:

Commission shall act as the court of competent jurisdiction under 29 U.S.C.A. § 1132(e}(l) and shall possess adjudicative authority to render decisions in individual proceedings by claimants to recover benefits due the claimant under the terms of the claimant's plan to enforce the claimant's rights under the terms of the plan or to certify the claim as right to future benefits under the terms of the plan. (Emphasis added).

Some may have viewed that Commission conclusion skeptically, but any tribunal always has the authority to decide whether it does or does not have authority or jurisdiction. In that regard, the Commission acted within its authority. After deciding that it had the authority to act, the Commission held that the 2013 Oklahoma Opt-Out was unconstitutional. Both of those conclusions were later affirmed by the Oklahoma Supreme Court, removing any doubt as to the Commission's authority; the authority to "act as" a court. 

The Oklahoma attorney challenging Commissioner Tilly has now filed a lawsuit, according to the Oklahoman. His legal challenge is statutory, but according to the Oklahoman, his motivation in challenging Tilly is that she "is the daughter of Fred Morgan, who is president of the Oklahoma State Chamber," who "helped write the 2013 workers' comp law." Because of that relationship, the attorney purportedly perceives a "a conflict of interest," and he believes the Oklahoma courts should intervene to preclude her appointment. In short, he disagrees with the law and decries Commission leadership by one so close to an author of that law.

Regarding last year's resignation request, the same attorney reminded WorkCompCentral of the Oklahoma Supreme Court affirmance of Vasquez, and the logic that "commissioners 'perform an adjudicatory function in deciding the fate of injured workers' benefits.'" Because of that authority, this attorney asserts that the Commission must be "treated as a court." He therefore asserted in 2016 that Governor Fallin's request threatened the very fabric of the law, the constitutional construction of government, the separation of powers. He perceived that gubernatorial request as the Oklahoma executive branch encroaching upon the courts, an independent branch of government (if they are to be "treated as a court," in his mind they must actually be a "court"). 

The actual statutory (legal) basis of this attorney's challenge to Tilly's appointment is in section 85A-19, which provides 
The Commission shall consist of three (3) full-time commissioners, each of whom must have been involved in the workers' compensation field for at least three (3) years, appointed by the Governor: one of whom is chosen from a slate of three selected by the Speaker of the House of Representatives, with all three confirmed by the Senate. 85A OK Stat § 85A-19 (2014). (Emphasis added).
The challenging attorney contends that Tilly lacks the three years required. According to Governor Fallin's appointment announcement, Ms. Tilly has been an assistant attorney general, and for more than three years she has managed "the attorney general’s multicounty grand jury unit." Furthermore, she has "assisted the workers’ compensation, insurance and Social Security fraud unit of the attorney’s general’s office." That experience with the criminal system, as it involved insurance and workers' compensation, is the foundation of her qualification under the three year requirement. This challenge is similar to the Commissioner Jordan Russell challenge; his workers' compensation experience is through work for the OK legislature. 

The challenging attorney essentially seeks a judicial interpretation of "involved." The legislature did not define what it meant by "involved." Merriam Webster defines "involved" simply as "being affected or implicated." In the absence of some statutory definition of "involved" it is likely that Oklahoma's courts would turn to this ordinary definition. And so, perhaps the question will simply be whether Ms. Tilly was "affected or implicated" by workers' compensation for three years. That does not seem to be an exceptionally difficult standard. Some might argue that if the legislature intended a more demanding standard, it could have used a word other than "involved," or defined its intent for that word. For example, Florida Judges are required to be "knowledgeable in the practice of law of workers' compensation." Perhaps that is a more stringent standard, perhaps not. 

An interesting aspect of this Oklahoma lawyer's challenge is the attorney's perception of a separation of powers issues with the Governor's management of the Commission last year. The attorney contended then that the Governor, Oklahoma's chief executive, should not manage an Executive Branch agency, because it "acts as" a court. The argument seems to be that if it "acts as" a court, then the state's court system should exclusively supervise and manage it. No statutory authority for that conclusion has been located. Neither has any authority been found that a legislature cannot contrive an executive agency as it deems appropriate, short of some constitutional constraint. Whether it can create a court is up to the constitution, as is whether it can delegate authority to "act as" a court. But, neither of these seem to be the foundation of this challenge. 

In this current lawsuit this attorney is asking that the Oklahoma Courts actively interfere in that executive branch management. This is premised presumably on the "treated" or "act" language. That is, if it is treated or acts like a court, it must in fact be a court and subject to exclusive management of the state's court system, immune from the management of the Executive Branch. 

Executive Branch agencies like the Oklahoma Commission are created by statute in most instances. The statute alone provides the qualifications ("involved") for appointment, and the applicable "check and balance." The statute does not provide for judicial approval or interpretation of qualifications, although one might argue that interpreting statutes is what courts are inherently designed to do. The statute, through which the Oklahoma Legislature created the agency and conveyed authority to it, however, provides a "check and balance" in its plain language. The Governor's appointments to the Commission are subject to confirmation by the State Senate. 

Some will therefore argue that the legislature has thus created a process, which provides minimal definition ("involved"), and leaves interpretation of that to the executive. The Oklahoma courts may therefore decline jurisdiction over this attorney's challenge to Commissioner Tilly, concluding that this is an issue of Gubernatorial discretion. That outcome is perhaps even more likely because of the statutory Senate confirmation requirement. The statutory process for appointment involves part of the body (legislature) that granted authority (delegated), in interpreting that standard ("involved"). The Governor seemingly decides whether someone is qualified, and then that conclusion must be concurred by the legislature that granted the authority.

Thus, the legislature may make a decision that it agrees or disagrees with the Governor. The interpretation of what the legislature meant by that statute("involved") can be made by the legislature itself. This is arguably like asking me (legislature) to tell you what I meant in that last paragraph, instead of you asking your cousin Bernice (courts) what she thinks I meant. WorkCompCentral reported May 16, 2017 that the Oklahoma Senate Judiciary Committee recently voted to confirm Tilly and Russell. Presumably, that vote evidences the Senate's concurrence that Ms. Tilly is qualified under the statutory standard. 

Is it inappropriate for the State's chief executive to manage executive branch agencies? Is it more or less inappropriate if such an agency looks or acts like a court? By the same logic, is it inappropriate for a court to substitute its judgment of qualification for the judgment of that chief executive, and/or the judgment of the State Senate? Is separation of powers about the three branches themselves, or is it about how the subdivisions of the three branches act or look? If the state begins to allow judicial second-guessing of appointment processes in the Executive Branch, as advocated here, where will that court involvement end. Is that court involvement itself not a significant threat to the same separation of powers the challenger relies upon?

It is probable that any court action regarding this challenge will not conclude prior to the expiration of Chair Gilliland's appointment in August. The potential effects on this system may be interesting. Potentially, this challenge could impair, or at least cast shadow upon, the Oklahoma workers' compensation adjudication system for some time, as the "involved" issue is litigated. 

As likely, the courts will recognize the real separation of powers and decline to adjudicate the qualification issue, concluding that this is an executive branch management decision, subject to Senate approval that has been provided. Or, alternatively, that upon the concurrence of the Senate in these appointments, the issue has become moot. For the sake of all involved, challenged and challenger, hopefully the state's courts will render any decision in this case rapidly. 

UPDATE: on June 8, 2017 the challenger dismissed his petition for writ of prohibition. Tilly's Senate confirmation stands, and she will take office in August, according to the Executive Director of the Oklahoma Commission.

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