COURT OF APPEALS OF VIRGINIA
Present: Judges Elder, Annunziata and Humphreys
Argued at Richmond, Virginia
NORTON CONCRETE COMPANY, INC.
MEMORANDUM OPINION* BY
v. Record No. 1645-00-2 JUDGE LARRY G. ELDER
APRIL 17, 2001
MARIO ANTONIO ESCOBAR
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
E. Wayne Powell (Powell & Associates, on
briefs), for appellant.
Gregory O. Harbison (Craig B. Davis;
Geoffrey R. McDonald & Associates, on brief),
for appellee.
Norton Concrete Company, Inc., (employer) appeals from a
decision of the Workers' Compensation Commission awarding benefits
to Mario Escobar (claimant) on his change-in-condition
application. On appeal, employer contends the commission
erroneously (1) refused to remand to the deputy commissioner for
consideration of a defense based on Granados v. Windson
Development Corp., 257 Va. 103, 509 S.E.2d 290 (1999); (2) refused
to re-open the record to allow it to submit after-discovered
evidence relevant to that defense and a claim of fraud; and (3)
considered claimant's representations on brief as evidence in
ruling on those requests. We hold that the commission's rulings
* Pursuant to Code § 17.1-413, this opinion is not
designated for publication.
on these issues did not constitute reversible error, and we affirm
the award of benefits.
I.
A.
WAIVER OF GRANADOS STATUS DEFENSE
Commission Rule 3.1 provides that
[a] request for review [of a deputy's
decision by the full commission] should
assign as error specific findings of fact
and conclusions of law. Failure of a party
to assign any specific error in its request
for review may be deemed by the Commission
to be a waiver of the party's right to
consideration of that error.
Here, the original attorney for both the employer and its
carrier determined not to pursue the Granados status defense at
the hearing before the deputy commissioner. Employer had the
right to be represented by its own counsel in those proceedings,
but it chose to rely on the carrier's counsel, as it conceded on
brief in referring to its "former counsel." Therefore, it is
bound by all representations and actions of counsel not timely
disclaimed. Cf. Hunter v. Commonwealth, 15 Va. App. 717, 427
S.E.2d 197 (1993) (upholding defendant's conviction for
willfully failing to appear in part because evidence indicated
attorney of record had notice of trial date and "[t]he
attorney-client relationship presumes that attorney and client,
as servant and master, will communicate about all the important
stages" of the proceedings).
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Furthermore, the record establishes that the commission
mailed a copy of the deputy commissioner's January 21, 2000
decision, which addressed only the marketing issue, not only to
counsel but also to employer itself. Thus, employer had at
least constructive notice of counsel's abandonment of the status
defense and the commission's entry of an award, which
specifically indicated that a request for review could be filed
with the commission within twenty days from the date of receipt
of the award. Despite this constructive knowledge, employer did
not file its own request for review, and it did not ask the
original counsel to withdraw from representing employer until
February 24, 2000, which presumably was well after the appeal
period had expired.
Finally, when employer retained new counsel separate and
apart from that provided by the carrier, it did not request
leave to add additional issues to its request for review.
Instead, it first asserted the status defense in its written
statement. Thus, under Rule 3.1, the commission was entitled to
view employer's failure properly to assign error to this issue
as "a waiver of [employer's] right to consideration of that
[alleged] error." Commission Rule 3.1.
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Assuming without deciding that the Granados status defense
implicates the commission's subject matter jurisdiction, 1
employer nevertheless was required to raise the defense in a
procedurally proper fashion. This entailed presenting both the
defense and the evidence to support it at the proper stage of
the proceedings. Although subject matter jurisdiction "cannot
be waived or conferred on the court by agreement of the
parties," Morrison v. Bestler, 239 Va. 166, 169-70, 387 S.E.2d
753, 755 (1990), a party asserting the lack of subject matter
jurisdiction as a defense must provide a proper evidentiary
record to support his claim, cf. Friedman v. State, 249 N.E.2d
369, 374 (N.Y. 1969) (holding that issues of fact in challenge
to subject matter jurisdiction become binding and subject to res
judicata once litigated but that where determination "is a mere
legal conclusion" not depending on the resolution of any
disputed factual issues, "the want of jurisdiction . . . may
always be asserted and raised directly or collaterally"); 4
C.J.S. Appeal and Error § 38, at 111-12 (1993) (noting that
absence of subject matter jurisdiction may not be waived but
that parties "may be estopped to deny the existence of facts on
which jurisdiction depends").
1
Nowhere in employer's brief did it use the word
"jurisdiction," and its references at oral argument to the
claimant's status as being jurisdictional were minimal.
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Defects in subject matter jurisdiction appearing on the
face of the record, therefore, may be challenged and reviewed at
any stage of a proceeding, whether at the trial level or on
appeal. However, a party wishing to establish a lack of subject
matter jurisdiction which is not apparent on the face of the
record must submit the evidence establishing that fact at the
proper stage of the proceedings. Here, employer was entitled to
submit evidence only to the deputy commissioner or, under
limited circumstances, to the commission on request for review,
as discussed infra in Part I.B. Because employer failed to
submit sufficient evidence to support its jurisdictional
challenge at the proper stage of the proceedings, its
jurisdictional challenge does not bar the contested award. 2
B.
AFTER-DISCOVERED EVIDENCE
The commission also did not err in refusing employer's
request to admit various documents as after-discovered evidence.
Commission Rule 3.3 provides:
No new evidence may be introduced by a
party at the time of review except upon
agreement of the parties. A petition to
reopen or receive after-discovered evidence
may be considered only upon request for
review.
A petition to reopen the record for
additional evidence will be favorably acted
2
We do not decide whether employer may be entitled to
assert the claim of lack of subject matter jurisdiction, based
on Granados, as a defense in any subsequent proceedings
involving claimant.
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upon by the full Commission only when it
appears to the Commission that such course
is absolutely necessary and advisable and
also when the party requesting the same is
able to conform to the rules prevailing in
the courts of this State for the
introduction of after-discovered evidence.
Therefore, the party seeking to re-open the record to submit
after-discovered evidence must prove that "(1) the evidence was
obtained after the hearing; (2) it could not have been obtained
prior to the hearing through the exercise of reasonable
diligence; (3) it is not merely cumulative, corroborative or
collateral; and (4) it is material and should produce an
opposite result before the commission." Williams v. People's
Life Ins. Co., 19 Va. App. 530, 532, 452 S.E.2d 881, 883 (1995).
Here again, employer did not seek leave to re-open the
record to submit after-discovered evidence in its request for
review, despite the fact that Rule 3.3 provides such request
"may be considered only upon request for review." Once employer
retained separate counsel, counsel did not seek leave to expand
the request for review and merely included the proffered
after-discovered evidence as attachments to employer's written
statement.
Further, the record supports the decision of the commission
that the documents employer proffered did not qualify as
admissible after-discovered evidence because, assuming without
deciding that they satisfy the first three prongs of the test,
they do not satisfy prong (4). First, proof that claimant
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falsified his driver's license and identification card was not
likely to produce a different result under Granados. Granados
specifically rejects the argument that an employer may deny
benefits to an injured employee simply because that employee
used forged citizenship documents to obtain employment. 257 Va.
at 106-08, 509 S.E.2d at 291-92. Under these circumstances,
"[an employer] fail[s] to demonstrate the required causal
relationship between [the employee's] false representation and
his resulting injury." Id. at 108, 509 S.E.2d at 292. In order
for an employer to deny benefits under Granados, it must
establish that the claimant was an illegal alien who could not
be employed lawfully in the United States such that "his
purported contract of hire was void and unenforceable." Id. at
108-09, 509 S.E.2d at 293. Thus, it is an employee's status as
an illegal alien rather than his actions in falsifying
citizenship documents which provides the basis for denying
benefits under Granados.
Here, the forgery conviction order employer sought to have
admitted, even viewed in conjunction with his employment
eligibility verification form and deposition, established at
best only that claimant presented falsified documents to
establish his citizenship. It did not establish that he was an
illegal alien or was otherwise unable to enter into a valid
contract for employment when hired by employer in 1995 or when
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injured in 1997. 3 Thus, employer was unable to prove admission
of the conviction order was likely to produce a different result
on the merits of the Granados status defense.
Second, admission of the proffered documents was not likely
to produce a different result on the disposition of this claim
because documents failed to establish that claimant fraudulently
induced employer to withdraw its Granados defense. 4 Fraud
requires proof of "'(1) a false representation, (2) of a
3
Employer argued in its written statement to the commission
that the conviction order was material because it established
claimant's guilt of crimes of moral turpitude which henceforth
would disqualify him from working in the United States under
federal immigration law. However, employer did not raise this
argument on brief or in oral argument to this Court, and we
consider it abandoned. See Tidewater Assoc. of Homebuilders,
Inc. v. City of Virginia Beach, 241 Va. 114, 118 n.2, 400 S.E.2d
523, 525 n.2 (1991).
Proof that claimant was not authorized to work in the
United States during the period of time for which he sought
partial disability compensation may have served as a valid
defense to claimant's change-in-condition application. See
Manis Constr. Co. v. Arellano, 13 Va. App. 292, 294, 411 S.E.2d
233, 235 (1991) (holding that partially disabled claimant who is
illegal immigrant is unable, as a matter of law, to market his
residual capacity because any such employment is illegal).
However, this defense, like the Granados status defense, was not
included in employer's request for review, and employer's
written statement to the commission referenced this issue only
in passing. The commission's majority opinion did not address
this issue, and employer did not assign error to this issue on
appeal to this Court. Thus, we consider this argument
abandoned, as well. See Tidewater Assoc. of Homebuilders, 241
Va. at 118 n.2, 400 S.E.2d at 525 n.2.
4
As set out above in the discussion of Granados, proof that
an employee used fraudulent citizenship documents to obtain
employment is insufficient to permit a denial of workers'
compensation benefits. Granados, 257 Va. at 106-08, 509 S.E.2d
at 291-92.
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material fact, (3) made intentionally and knowingly, (4) with
intent to mislead, (5) reliance by the party misled, and (6)
resulting damage to the party misled.' The fraud must be proved
by clear and convincing evidence." Batrouny v. Batrouny, 13 Va.
App. 441, 443, 412 S.E.2d 721, 723 (1991) (quoting Winn v. Aleda
Constr. Co., 227 Va. 304, 308, 315 S.E.2d 193, 195 (1984)).
When employer's counsel deposed claimant, claimant implied
that he believed he would soon be receiving a work permit, but
he admitted he did not then have a green card and was not
otherwise authorized to work in the United States at that time.
He also admitted that the Department of Motor Vehicles (DMV) had
taken the only social security card and driver's license he had
and told him it did so because the cards bore an incorrect
number. He said he obtained the number on the cards from an
English-speaking Mexican woman who provided volunteer help to
the Hispanic community and accompanied claimant to the DMV to
fill out the application for him. Employer did not specifically
ask claimant whether he was an illegal alien or was otherwise
unable to enter into a valid contract for employment when hired
in 1995 or when injured in 1997.
Claimant's workers' compensation attorney represented at
the deposition only that claimant had an immigration appeal
pending and was legally entitled to remain in the United States
pending that appeal; he did not represent that claimant was
authorized to work at that time and made no representations
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regarding claimant's immigration status at the time he was hired
or the time he was injured. Although claimant's attorney said
he was unable to provide documentation regarding claimant's
current status, he indicated that he planned to subpoena
claimant's immigration lawyer to testify on that subject.
At the deputy commissioner's hearing, the parties
apparently had further discussions regarding claimant's status,
but those discussions do not appear in the record. The record
indicates only that employer did not assert the Granados status
defense at that hearing and that it believed claimant's
"immigration status is apparently pending and that he's legal
during the pending status."
Employer has failed to establish that any of the
representations claimant or his representatives made during the
deposition or at the deputy commissioner's hearing were false.
Employer had ample opportunity to conduct a more detailed
investigation of claimant's status prior to the hearing by
deposing claimant's immigration lawyer or subpoenaing records
related to the immigration proceedings, but the record contains
no indication that it did so. Thus, employer failed to make out
even a prima facie case of fraud.
For these reasons, employer failed to prove that admission
of the proffered documents was likely to produce a different
result. Therefore, we hold the commission did not commit
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reversible error in refusing to admit the proffered exhibits as
after-discovered evidence.
C.
CLAIMANT'S REPRESENTATIONS ON REVIEW AS EVIDENCE
Employer contends lastly that the commission erred in
considering as evidence arguments claimant made in his written
statement on review. It also contends that such statements were
immaterial because they related to the legality of claimant's
remaining in the country pending his immigration appeal rather
than to the impact of his immigration status on his ability to
contract for employment. We hold that the commission's reliance
on the challenged statements, if error, was harmless and that
the commission focused on the material issue in the case.
The commission stated in its opinion that claimant had
prepared to challenge employer's Granados status defense by
calling as a witness the attorney who was handling claimant's
immigration application and petition for asylum. The commission
noted its own records confirmed that this attorney had appeared
as a witness for an aborted hearing scheduled for August 10,
1999, but it went on to note that the attorney "appeared for the
evidentiary hearing on January 11, 2000, but was not called
because the defendants abandoned their illegal immigrant
defense." It indicated that "these representations are
uncontradicted and accepted as credible and probative." It then
considered those representations as evidence that "facts
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concerning [the status defense] [were] known to, but . . .
abandoned by, the defendants at that evidentiary hearing."
Assuming without deciding that the commission's reliance on
this proffer was error, the commission relied on it only as it
related to employer's waiver of the Granados status defense.
Contrary to employer's assertion, nothing in the record
indicates that the commission relied on it as substantive
evidence of claimant's ability to remain in the United States or
that the commission improperly focused on claimant's ability to
remain in the United States rather than on his status and
related ability to work. Because other undisputed evidence in
the record established employer's waiver of the status defense,
as discussed supra in Part I.A., any error of the commission in
relying on claimant's proffer was harmless. See, e.g., Ferguson
v. Commonwealth, 16 Va. App. 9, 12, 427 S.E.2d 442, 444-45
(1993).
II.
For these reasons, we hold the commission did not commit
reversible error in refusing to remand to the deputy commissioner
for consideration of a Granados status defense; refusing to
re-open the record to allow employer to submit after-discovered
evidence claimed to be relevant to that defense and a claim of
fraud; and considering claimant's representations on brief as
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evidence in ruling on those requests. Therefore, we affirm the
commission's award.
Affirmed.
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