“Labor Code section 5813 provides, in relevant part: "The . . . appeals board may order a party, the party's attorney, or both, to pay any reasonable expenses, including attorney's fees and costs, incurred by another party as a result of bad-faith actions or tactics that are frivolous or solely intended to cause unnecessary delay. In addition, . . . the appeals board, in its sole discretion, may order additional sanctions not to exceed two thousand five hundred dollars ($2,500) to be transmitted to the General Fund."”
(Lab. Code, § 5813, as quoted in Coldiron I, supra, at p. 5.)
“WCAB Rule 10561 (Cal. Code of Regs., tit. 8, § 10561) provides, in relevant part: "On its own motion . . ., the Workers’ Compensation Appeals Board may order payment of reasonable expenses, including attorney’s fees and costs and, in addition, sanctions as provided in Labor Code section 5813. Before issuing such an order, the alleged offending party or attorney must be given notice and an opportunity to be heard. In no event shall the Appeals Board, . . . impose a monetary sanction pursuant to Labor Code section 5813 where the one subject to the sanction acted with reasonable justification or other circumstances make imposition of the sanction unjust. "A bad faith action or tactic is one which results from a willfull failure to comply with a statutory or regulatory obligation or from a willful intent to disrupt or delay the proceedings of the Workers’ Compensation Appeals Board."”
(Coldiron v. Compuware Corp. (2002) SRO 0088351, 67 Cal.Comp.Cases 289 (Appeals Bd. en banc) [Coldiron I], quoting Cal. Code Regs., tit. 8, § 10561 [“willfull” so in original]. Source: scanned slip opinion; text proofread against the page images — see the transcript note at /api/verification, at p. 6.)
“Failure of the administrator to disclose the identity of its client may subject it to sanctions pursuant to Labor Code section 5813.”
(Coldiron I, supra; accord § 16.2 [the disclosure duties], at p. 2.)
“In addition, we will not impose sanctions on Gallagher Basset inasmuch as this is the first time that the Appeals Board has addressed the underlying issue presented by this case. But for this being a case of first impression, six years of "human error" would not be acceptable as a defense to the imposition of sanctions.”
(Coldiron v. Compuware Corp. (2002) SRO 0088351, 67 Cal.Comp.Cases 1466 (Appeals Bd. en banc) [Coldiron II] [“Gallagher Basset” so in original; first-impression forbearance; six years of “human error” otherwise indefensible], at p. 5.)
Cross-references: § 14.9 (defendant’s remedies for frivolous claims); § 16.2 (the Coldiron disclosures).
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