Clifford R. Mugrauer, Petitioner,
v.
Industrial Commission of
the State of Colorado; Director, Department of
Labor and
Employment; Division of Employment and Training; Rio Grande
Western Land Company, Inc.,
Respondents
No. 84CA0792
709 P.2d 47
Court of
Appeals of Colorado,
Div. II.
June 6, 1985
Colorado Rural Legal Services, Inc., Lisa Robinow,
Alamosa, Colorado, Attorneys for Petitioner.
Duane Woodard, Attorney General, Charles B. Howe, Chief Deputy
Attorney General, Richard H. Forman, Solicitor General, Dani R.
Newsum, Assistant Attorney General, Denver, Colorado, Attorneys for
Respondents Industrial Commission and Director, Department of Labor
and Employment.
No appearance for Respondent Rio Grande Western Land Company.
SMITH, Judge.
Claimant, Clifford Mugrauer, seeks review of a final order of the
Industrial Commission in which it determined that he had been
overpaid $1,596 in unemployment compensation benefits. We set aside
the order and remand for further proceedings.
Claimant applied for unemployment benefits on January 19, 1983,
alleging that he had been laid off. On January 26, 1983, the
employer, Rio Grande Western Land Company, protested payment
alleging that the claimant had voluntarily quit his job. The
Division of Employment wrote to claimant on May 11, 1983, informing
him of his employer's protest of payment. A hearing was held on
August 9, 1983, and the hearing officer determined that the claimant
was responsible for his separation from work and accordingly reduced
claimant's benefits. On September 2, 1983, the Division of
Employment sent claimant a Notice of Overpayment of Benefits in the
amount of $1596.
Claimant appealed the overpayment decision alleging that it would
be inequitable to collect the overpayment in that he had relied to
his detriment on his unemployment checks. The Commission found that:
"recovery of the overpayment is not
inequitable and waiver of same is not in order. While the
claimant was overpaid not as a result of misrepresentation,
the criteria for waiver of overpaid benefits as contained in
Regulation 15 to the Colorado Employment Security Act is not
met here. The claimant is still living and is not totally
and permanently disabled. The claimant has not removed
himself from the labor market, and while his financial
resources are limited at best, he has not been adjudicated
as bankrupt. There is no showing that the cost of collection
exceeds the amount of overpayment; or that the overpayment
is uncollectible or administratively impracticable."
The Commission concluded that the cases cited by claimant in
support of his claim that recovery of the overpayment would be
against equity and good conscience had been overruled in that the
relevant statute had been amended to delete the provision permitting
recovery of overpayment to be waived for reasons of "equity and good
conscience." The Industrial Commission affirmed the referee in form
orders.
The claimant contends that the findings of the Commission were
inconsistent with Colorado case law and statutory authority. We
agree.
The cases relied upon by claimant in support of his position were
Duenas-Rodriguez v. Industrial Commission, 199 Colo. 95, 606
P.2d 437 (1980) and Schmidt v. Industrial Commission, 42
Colo. App. 253, 600 P.2d 76 (1979). These two cases interpreted §
8-81-101(4)(a), C.R.S. , which provided in pertinent part:
"Any person who has received any sum as
benefits . . . . for which he was not entitled other than by
reason of his false representation or willful failure to
disclose a material fact, if so found by the division, shall
be liable to repay such amount to the division . . . . if
such recovery would not, in the opinion of the division, be
against equity and good conscience. The division may waive
the recovery or adjustment of all or part of the amount of
any such overpayment which it finds to be noncollectible, or
the recovery or adjustment of which it finds to be
administratively impracticable." (emphasis added)
At the time of claimant's hearing the above quoted statute, along
with other sections, had been amended. See Colo. Sess. Laws
1979, ch. 67, § 8-81-101 (4)(a) at 355. As part of these amendments
the words against equity and good conscience were deleted and were
replaced by "if such repayment in the opinion of the division would
not be inequitable."
Although Duenas-Rodriguez, supra, and Schmidt, supra,
were decided under the prior law, they remain pertinent in that
there is no substantial difference between the meaning of the
phrases "against equity and good conscience" and "not inequitable."
In Duenas-Rodriguez, supra, the pertinent phrase in the
previous statute was recognized as having the following meaning:
"'Against equity and good conscience
means that adjustment or recovery of an incorrect payment .
. . . will be considered inequitable if an individual,
because of a notice such payment would be made or by reason
of the incorrect payment, relinquished a valuable right . .
. . or changed his position for the worse . . . .'"
That definition remains applicable under the present statute.
Here, in reliance on the unemployment benefits, claimant had
relinquished certain rights, i.e., the right to obtain public
assistance in the form of food stamps and the right to participate
in the Low Income Energy Assistance Program. He also argued that if
he had not been receiving unemployment benefits he would have looked
for work in other areas and limited his expenses. However, the
hearing officer looked only at claimant's financial circumstances
and did not consider claimant's arguments. Under such circumstances,
the ruling cannot stand.
The order is set aside and the cause is remanded for a new
determination on the equitability of collection consistent with the
rule in Duenas-Rodriguez, supra.
Judge Kelly and Judge Metzger concur.
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