dissenting in part.
I agree that the request for stay was improperly denied in this case. However, I would revise the interpretation of “irreparable damage” which we embraced in Wise Mechanical Contractors v. Bignell, 626 P.2d 1085 (Alaska 1981). Bignell and Johns v. State, Dep’t of Highways, 431 P.2d 148, 151 (Alaska 1967), established a two-prong test for stays of workers’ compensation. The test requires a showing of both the employee’s financial irresponsibility and the probability that the employer’s appeal will succeed on the merits. While this standard is adequate for most situations, the two prongs should not have been stated as elements of “irreparable damage,” as Bignell suggests. Bignell, 626 P.2d at 1087; see also Johns, 431 P.2d at 151. “Irreparable damage” is unquestionably a term of art describing one of the equitable requirements for injunctive relief. The “irreparable injury” requirement should not be conflated with the separate and distinct “likelihood of success on the merits” requirement.
Separating these two requirements results in a more straightforward analysis and allows for a proper focus on the balance of equities in a given case. The majority maintains that the A.J. Industries balance of hardship standard “provides guidance for motions for stays.” Rather than merely using the balance of hardship approach for guidance, I would adopt this standard and make the rules governing the issuance of stays in workers’ compensation cases the same as the rules for the issuance of preliminary injunctions.
I would also preserve the trial judge’s discretion to decide these motions on a case by case basis. The trial court should consider the nature of the award at issue, as well as the full effect on the parties of a denial or a grant of the requested stay, before determining whether to employ the “serious and substantial questions” standard or the “probability of success on the merits” standard. I believe that this methodology is preferable to a general rule on “lump sum payments” and is better suited to the equitable nature of the proceeding. Some lump sum awards will not be large. A stay of payment on a relatively small award may work hardship on an employee. Rigorous application of the balance of hardships test will weed out such cases from cases at the other extreme such as Lawson’s, which involve an unusually large lump sum award to an employee already regularly receiving maximum benefits.