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On Liens and Communication Problems

May 31st, 2013

We’ve seen a lot of panel decisions recently from the Workers’ Compensation Appeals Board holding that lien claimants must obey the law as stated in Labor Code section 4903.06Filing a petition for costs hasn’t worked.  Nor has waiting until appearing before the workers’ compensation Judge to pay the fee (in the hopes that settlement negotiations would eliminate the need for a fee payment).

So here’s an odd case for you (Ricardo Zambrano v. La Pinada): a lien claimant had paid the fee, in accordance with Labor Code section 9403.06, but failed to provide proof of such payment because the lien representative didn’t appear.  The WCJ dismissed the lien, and the lien claimant petitioned for reconsideration, arguing that Code of Civil Procedure Section 473(b).  Section 473(b) allows an order of dismissal to be rescinded based on the inadvertence or mistake of the party’s counsel.

Now, here’s where it gets odd: the lien representative’s claim of inadvertence comes as follows: “the hearing representative assigned to the case mistakenly failed ‘to communicate with [the lien representative] to allow them to email or fax him on the date of the hearing the proof of payment of the lien activation.”

Well, was the dismissal based on the “inadvertence, surprise, excusable neglect, or an honest mistake”?  Not according to your humble blogger.

What is the inadvertence?  It looks like no one made an appearance for lien claimant or the lien representative’s office to begin with.  Also, what’s the excuse for not knowing the law?  It’s one thing to be taken by surprise by having a party raise a last-minute argument or issue.  There is NO QUESTION that a lien claimant has to show up ready to prove payment of the lien activation fee.  This is an issue that cannot possibly not come up unless a dismissal is on the horizon.

This was an issue of the lien representative not being up to date on the law or disregarding the most basic calendaring function on Microsoft Outlook (or Mozilla Thunderbird).  Instead of affirming the dismissal of the lien, the WCAB will now require defendant to prepare for a second hearing, although the WCAB did recommend the WCJ impose sanctions.

In any case, this opinion suggests that lien claimants may be relieved of their duties under section 4903.06(a)(4) (“If the fee has not been paid or no proof of payment is available, the lien shall be dismissed with prejudice.”)  The language suggests that the legislature intended to have lien claimants make a timely payment AND provide proof of payment.

I wonder, dear readers, could the failure to pay the lien activation fee itself be “inadvertence” to trigger section 473(b)?  Let’s hope not…

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