Standard of Review – Comp Appeals

Standard of Review for Workers’ Compensation Appeals

I. Introduction

The Workers’ Compensation Act (“the Act”) provides its own template for appellate review.^[1]  Specifically, under § 9-745 of the Labor and Employment (“L&E”) Article of the Maryland Code, appeals out of the the Maryland Workers’ Compensation Commission (“WCC” or “the Commission”) proceed in one of two ways.^[2]  Regardless of the selected method, the initial review of the agency’s decision occurs in the circuit court.

One of the two options is found in L&E § 9-745(d) and provides for an entirely new evidentiary hearing before a jury in the circuit court.^[3]  This modality is also known as an “essential trial de novo” and is employed “where the question on review is ‘concerned only with findings of fact.’”^[4]

The second option, which is regarded as the “the routine appeal process” in workers’ compensation cases, is located in L&E § 9-745(c) and involves a judicial review of the record made before the Commission.^[5]  This modality is employed to address assertions of “legal error” and involves deference to the factual findings of the Commission unless clearly erroneous.^[6]

II. The Standard of Review Differs for Courts Exercising Appellate Jurisdiction under L&E § 9-745(c) and (d)

“Routine” appeals from the WCC function differently than appeals in other contexts.  In a criminal case, for example, the Court of Appeals may review the determination of the intermediate appellate court exclusively, without regard to specific rulings made at the trial court level.  In contrast, appeals under L&E § 9-745(c) operate the same at every level of the appellate food chain.^[7]  That is, whether it be the Court of Special Appeals or the Court of Appeals, an appellate court stands in the shoes of the circuit court and reviews the decision of the WCC directly.^[8]

However, this is not the case with an “essential trial de novo.”  Rather, subsequent review of the circuit court following an appeal under L&E § 9-745(d) proceeds the same as would review of “any other bench trial.”^[9]  That is, an appellate court considers the decisions of the lower courts instead of standing in the shoes of the circuit court and reviewing the agency directly.^[10]

III. The Review is for “Legal Correctness” under L&E § 9-745(c)

L&E § 9-745(c) mandates appellate consideration of three factors: (1) whether the WCC justly considered all the facts concerning the injury in question; (2) whether the WCC exceeded the powers granted to it by law; and (3) whether the WCC misconstrued the applicable law and facts.

According to the Court of Appeals, review under L&E § 9-745 (c) is “narrow,” and merely requires that a court assess the “legal correctness” of the agency’s decision.^[11]  The inquiry is expressly “limited” by L&E § 9-745(e), which mandates that legally correct decisions be affirmed, even if the reviewing court would prefer to hold differently de novo.^[12]

IV. The Concept of Deference to the Commission.

Appellate review is further limited by L&E § 9-745(b), which states that the WCC’s decision is presumed “prima facie correct.”  However, the Court of Appeals has made clear that the presumption extends solely to questions of fact; thus Maryland courts review questions of law independently.^[13]

Although the presumption in L&E § 9-745(b) does not reach questions of law, there are times where the agency’s ruling is nevertheless entitled to deference.^[14]  For example, in Wal Mart v. Holmes, the Court of Appeals explained that the WCC’s “interpretation of the statute it is charged with administering will be given deference unless its conclusions are based upon an erroneous conclusion of law.”^[15]

In other words, when the Commission’s ruling is not based upon erroneous conclusions of law – i.e. when the ruling is “legally correct” – a reviewing court’s “limited” inquiry is at its end, again because L&E § 9-745(e) mandates that the Commission be affirmed.

V. Conclusion

§ 9-745 of the Labor and Employment Article provides the standard of review for appeals out of the the Workers’ Compensation Commission.  Pursuant to L&E § 9-745(e), an appellate court is required to affirm WCC decisions that are legally correct under L&E § 9-745(c).  Further, the Court of Appeals has held that the “presumption of correctness” in L&E § 9-745(b) does not apply to questions of law; nevertheless, the WCC’s ruling may be entitled to some deference, provided that its rationale cannot be said to have been based upon a legal incorrectness.