A stipulation is an agreement between parties ordinarily entered into for the purpose of avoiding delay, trouble, or expense in the conduct of the action before the Board. Stipulation may be related to issues or even awards.
To be enforced stipulations must be approved by a Workers' Compensation Judge.
A stipulation between parties is not binding until approved and an award made by a Judge or the Board itself based on a proposed stipulation. Huston v. W.C.A.B. (1979) 44 Cal.Comp.Cases 798 (Published) and Lorenz v. Encino Hospital Medical Center, et. al. (2014) 2014 Cal.Wrk.Comp. P.D. LEXIS 410 (Panel Decision).
Further, an award based upon a stipulation may be reopened or rescinded if the stipulation has been entered into inadvertence, excusable neglect, fraud, mistake of fact or law, or for special circustances exist rendering it unjust to enforce to stipulation. Benavides v. W.C.A.B. (2014) 79 Cal.Comp.Cases ___ (Unpublished).
Stipulated awards that have been approved by a Workers' Compensation Judge are the same as awards that issue from a trial before a Judge. The only difference is the award is based on the agreement (stipulation) of the parties rather than a finding by a Judge after a trial.
Where there is no dispute as to the facts in the case, or where disputes have been compromised, the parties may submit written stipulations, signed by the parties, to the Appeals Board with a request that an Order or Award issue pursuant to the stipulation without the necessity for a hearing. If an attorney's fee is sought, the amount requested should be included in the stipulation or a request should be made to the Board to award a reasonable attorney's fee.
Labor Code section 5702 provides:
The parties to a controversy may stipulate the facts relative thereto in writing and file such stipulation with the appeals board. The appeals board may thereupon make its findings and award based upon such stipulation, or may set the matter down for hearing and take further testimony or make the further investigation necessary to enable it to determine the matter in controversy.
It is common for the parties to agree to insert the following statement in a proposed stipulation; "Applicant waives penalty and interest on this Award if the Award is paid within 30 days of service on the defendant of the Award signed by the Workers' Compensation Judge."
While stipulation between adversary parties concerning the existence or nonexistence of material facts are permissible in workers' compensation cases, the stipulations are not binding on the Appeals Board or the Workers' Compensation Judge. The Board or the Judge may reject the stipulation. ( Lab. Code sec. 5702; Turner Gas Co. v. W.C.A.B. (1975) 40 Cal.Comp.Cases 253 (Published).) See also Bekins Moving & Storage Company v. W.C.A.B. (Garner) (1980) 45 Cal.Comp.Cases 256 (Published).
An informal agreement between the parties to refer a case to an AME is not an enforceable order as it is not deemed a stipulation without a Judge's involvement. (Pedroza v. W.C.A.B. (2004) 69 Cal.Comp.Cases 287 (Writ Denied).)
If a Judge will not approve a request for stipulated award, he or she should set the matter for hearing. If the Judge issues an amended stipulated award without the consent of the parties, it is null and void. See Phillips Products, et al. v. W.C.A.B. (Rue) (2001) 66 Cal.Comp.Cases 1425 (Writ Denied). In Rue, the Court of Appeal stated, in part:
In Weatheral [sic], supra, at p. 4, the Court stated, "stipulations are not 'deemed amended' to conform to proof," and annulled the award with directions to consider the issue of good cause for setting aside the stipulation. Similarly in this case, the terms of the contract were improperly changed by the previous WCJ without approval from applicant. The fact that one could argue that the change was more favorable, e.g. the stipulation to permanent disability of 0% was changed to 3%, is not dispositive of the issue. (See, Weatherall v. Workers' Comp. Appeals Bd. [sic], supra, at page 5.)....
When parties file Stipulations with Request for Award the stipulations must be signed by the applicant, applicant's attorney (if any), and the attorney or authorized representative for the defendant.
Appeals Board Policy and Procedural Manual section 1.100 provides:
Where parties file Stipulations with Request for Award (DWC WCAB Form 3), the stipulations shall be signed by the applicant, applicant’s attorney (if any), and the attorney or authorized representative for defendant.
Appeals Board Policy and Procedural Manual, section 1.105 provides:
Except for settlements involving uninsured employers (see, P&P section 1.93), where a compromise and release agreement or stipulations with request for award is filed with lien claims that remain unresolved after good-faith attempts to resolve them, the WCJ reviewing the settlement should approve the settlement, if it is otherwise adequate. It is inappropriate for a WCJ to refuse to consider the adequacy of a settlement until all lien claims have been resolved. [Author's Note: Consider how this policy differs when the settlement involves an uninsured employer as set forth in the Appeals Board Policy and Procedural Manual section 1.93.]
When Stipulations with Request for Award are filed with lien claims that remain unresolved, after a good-faith effort to resolve them, the Judge should approve them if adequate. If deemed inadequate, the Judge should immediately initiate proceedings to resolve the liens pursuant to Title 8 California Code of Regulations section 10888 which provides:
Before issuance of an order approving compromise and release that resolves a case or an award that resolves a case based upon the stipulations of the parties, if there remain any liens that have not been resolved or withdrawn, the parties shall make a good-faith attempt to contact the lien claimants and resolve their liens. A good-faith attempt requires at least one contact of each lien claimant by telephone or letter. After issuing an order approving compromise and release that resolves a case or an award that resolves a case based upon the stipulations of the parties, if there remain any liens that have not been resolved or withdrawn, the workers' compensation judge shall (1) set the case for a lien conference, or (2) issue a ten (10) day notice of intention to order payment of any such lien in full or in part, or (3) issue a ten (10) day notice of intention to disallow any such lien. Upon a showing of good cause, the workers' compensation judge may once continue a lien conference to another lien conference. If a lien cannot be resolved at a lien conference, the workers' compensation judge shall set the case for trial. An agreement to pay, adjust or litigate a lien, or its equivalent, or an award leaving a lien to be adjusted, is not a resolution of the lien.
However, generally defendants refuse to agree to insert language in a Compromise and Release Agreement, stipulation, or agree that a Judge may issue a Minute Order wherein defendants agree to "hold harmless" an applicant as a result of any litigation by a lien claimant in the case. The reason for this reluctance is that defendants fear that they may be subjecting themselves to providing a civil or criminal attorney to such an applicant, depending on the circumstance.
In Ensley v. W.C.A.B. (1985) 50 Cal.Comp.Cases 704, a stipulation entered into between the parties that 50 percent of the applicant's heart permanent disability was caused by nonindustrial factors was found not binding in a subsequent heart claim for new and further disability. See also Develbiss v. W.C.A.B. (1985) 50 Cal.Comp.Cases 356 (Unpublished).
Stipulations once approved by a Judge and an award has issued becomes an executed contract and it is extremely difficult to convince a Court that good cause exists to be relieved from the stipulations. See Houston v. W.C.A B. (1979) 44 Cal.Comp.Cases 98 (Published) and Singh v. W.C.A.B. (2017) 82 Cal.Comp.Cases 983 (Unpublished).
Inadequacy generally, is not considered good cause for relief from a stipulation. See Robinson V. W.C.A.B. (1987) 52 Cal.Comp.Cases 419 (Published).See also Brannen v. W.C.A.B (1996) 61 Cal.Comp.Cases 554 (Published), where good cause was established to be relieved from the stipulation.
Inasmuch as an insurance carrier represents the employer an employer need not sign the stipulation unless the employer is self-insured
Stipulations for an award must be set forth on DWC-CA Form 102114(a) which may be downloaded at http://www.dir.ca.gov/dwc/forms.html
A stipulation is evidence upon which a judgment may be made and may by itself constitute substantial evidence in support of such judgment. However, stipulations are not binding upon persons who were not a party to the agreement.
A stipulation is in the nature of a contract; its construction is governed by the general rules of construction of other contracts. See Jackson v. Puget Sound Lumber Co. (1898) 123 Cal. 97, 100 (Published); People v. Nolan (1917) 33 Cal.App. 493, 495 (Published). A stipulation should be given limited effect "so as not to extend beyond what the parties thereto clearly intended." (Orr v. Forde (1929) 101 Cal.App. 694, 699-670 (Published).) See also Dunlap v. W. C.A.B. (1983) 48 Cal.Comp.Cases 355 (Unpublished).
Where a stipulation has been entered into through inadvertence, excusable neglect, fraud, mistake of fact or law, where the facts stipulated have changed or there has been a change in the underlying conditions that could not have been anticipated, or where special Circumstances exist rendering it unjust to enforce the stipulation, a Court may exercise its sound discretion and set aside the stipulation. (L.A. City School District v. Landier Inv. Co. (1960) 177 Cal.App.2d 744, 2 Cal.Rptr. 662 (Published); In Re Marriage Carter (1971) 19 Cal.App.3d 479, 97 Cal.Rptr. 274 (Published); Harris v. Spinali Auto Sales Inc. (1966) 240 Cal.App.2d 447, 20 Cal.Rptr. 586 (Published).)
See Republic Indemnity Company of America v. W.C.A.B. (Hunter) (2008) 73 Cal.Comp.Cases 414 (Writ Denied), where the Board allowed an insurer a hearing on the issue of setting aside a prior stipulation as to coverage. In finding that Labor Code Section 5804 did not preclude the Board from reopening a prior award, the Board opined that the issue did not involve the issue of employment. The Board stated, in part:
In its answer herein, Republic asserts that Alea ''is the party who caused all of the problems in this case,'' and that Alea is estopped to deny coverage. These allegations do not provide a sufficient reason to deny Alea at least an evidentiary hearing and attempt to prove that there is good cause to relieve Alea of its stipulation to coverage. Moreover, if Republic received premiums for providing workers' compensation coverage on the date of applicant's injury, it would be anomalous for Republic to avoid paying any benefits. In any event, Republic will have opportunity, at trial level, to produce evidence and contest Alea's attempt to avoid its stipulation to coverage. For this reason, we do not perceive any denial of due process to Republic....
In setting aside a stipulation where the defense attorney incorrectly stated earnings as maximum, which applicant's attorney stood by knowing of the error but not correcting it in Davis v. W.C.A.B. (2001) 66 Cal.Comp.Cases 906 (Writ Denied), the Appeals Board, in upholding the Judge's setting aside of the stipulation, stated, in part:
We agree with the WCJ's conclusion that defendant's attorney did not fail to exercise due diligence in discovery and preparation, but instead made a negligent error in entering the indemnity rate. This was not a simple unilateral mistake, as urged by applicant's attorney. It is a mistake that was made by defendant's attorney, and tacitly agreed to by attorney Bailey. The intention of the parties was to enter into an agreement where applicant's permanent disability of 20% was to be indemnified at the correct rate. Both attorneys, and applicant, had knowledge of the mistake before the agreement was executed. In this sense, it was a mutual mistake, and recission was appropriate. The circumstances in this case render it unjust to enforce the stipulation. We see no error or abuse of discretion in the WCJ's decision to set aside the stipulation, and will deny applicant's petition for reconsideration....
The Board also pointed out, with respect to applicant's attorney's contention that he had no obligation to offer information under the circumstances of this case, that he is a member of the bar and an officer of the Court. The Board cited California Rules of Professional Conduct, Rule 5-200, which provides that, "In representing a matter to a tribunal a member: ... Shall not seek to mislead the judge, judicial officer or jury by an artifice or false statement of fact or law."
Stipulations cannot be set aside simply because they result in harm to an injured worker. They can only be set aside if entered into through inadvertence or mistake of fact. Commenting on this in County of Sacramento v. W.C.A.B. (Weatherall) (2000) 65 Cal.Comp.Cases 1 (Published), and holding that a stipulation can only be set-aside by the Board upon a showing of good cause, the Court of Appeal, Third District, stated, in part:
The workers' compensation system is designed to assure benefits to injured workers' without the need to resort to a lawsuit. Procedural informality which would make the civil practitioner shudder is normal. But even a "flexible" system must have structure. Here, the Workers' Compensation Appeals Board (Board) deprived a party of the benefits of a stipulation. We annul the Board's decision and remand the matter.
DISCUSSION
The Board majority held a stipulation had to be justified, that is, based on evidence. Not so. A stipulation is "An agreement between opposing counsel ordinarily entered into for the purpose of avoiding delay, trouble, or expense in the conduct of the action," (Ballentine, Law Dict. (1930) p. 1235, col. b), and serves "to obviate need for proof or to narrow range of litigable issues" (Black's Law Dict. (6th ed. 1990) p. 1415, col. a) in a legal proceeding.
Judge Coffey elaborated on the hornbook with his usual eloquence as follows: "What is a stipulation " In the Roman law it was a verbal contract and was in that jurisprudence considered the most solemn and formal of all contracts. It was from [mouth to mouth], ore tenus; and, in that sense, in early times at this local bar it was considered as if in writing under seal; that is tradition; but times have changed and now a stipulation is, in practice, an engagement in writing fastened by the signatures of the parties thereto, and even then, in some instances, seems to be repudiable. Once a man's word was his bond, but we have changed all that; and the primitive methods have given way to a condition in which a solemn obligation scripturally incased has no more validity than the vapor of the breath of an inebriate. [¦] The law, however, remains to communicate virtue to the script, and it will not allow the court to exercise its imagination by supplying the alleged omissions in the stipulated statement." (Estate of Bainbridge (1914) 6 Coffey's Prob. Dec. 308, 323, affd. Estate of Bainbridge (1915) 169 Cal. 166 [146 P. 427]. See B. Nicholas, An Introduction to Roman Law (Oxford U. Press 1962) Contracts, pp. 193-194; W. Kunkel, An Introduction to Roman Legal and Constitutional History (Oxford U. Press 2d ed. 1972) The Development of Civil Law, p. 79, fn. 1.)
"A stipulation may lawfully include or limit issues or defenses to be tried, whether or not such issues or defenses are pleaded. [Citations.]" (Bemer v. Bemer (1957) 152 Cal.App.2d 766, 771; see Estate of Burson (1975) 51 Cal.App.3d 300, 306-307 [124 Cal.Rptr. 105] ["The stipulation furthers the public policies of settling disputes and expediting trials and is by no stretch of the imagination contrary to the policy of California. On the record here, it simply reflected what the parties agreed the pertinent language meant. The stipulation avoided the necessity of expenditure of the time and money of the parties and the public by removing from the litigation an item not in dispute."]; cf. Burrows v. State of California (1968) 260 Cal.App.2d 29, 33 [66 Cal.Rptr. 868], ["Obviously, plaintiffs did not intend to stipulate away their case while urging it;" there the stipulation would put the party out of court. Here, applicant eliminated one of two theories of recovery, and pressed the remaining theory].)
It is true the Board has the discretion to reject factual stipulations. (Lab. Code, §5702; see Frankfort General Ins. Co. v. Pillsbury (1916) 173 Cal. 56, 58-59 [159 P. 150] [decided under predecessor statute].) But discretion does not validate capricious decision making (Bailey v. Taaffe (1866) 29 Cal. 422, 424), and we are unaware of any statute permitting the Board to reject a stipulation clarifying the issues in controversy absent good cause. (See Robinson v. Workers' Comp. Appeals Bd. (1987) 194 Cal.App.3d 784, 790-791 [239 Cal.Rptr. 841, 52 Cal. Comp. Cases 419].)....
Persuaded that the Fluss declaration made a showing of inadvertence, the Judge recommended that the Board grant the petition. The Board denied reconsideration, for the same two reasons the Judge had previously articulated, stating that: "[t]he declaration of applicant's former attorney does not establish a mistake as to the facts or law, but simply indicates a lack of due diligence." It added: "To set aside the stipulation now would require that the issue of temporary disability be determined despite the now final finding contained in the December 15, 1981, decisions."
The Court of Appeal, First District, in reversing the Board and permitting withdrawal of the stipulation stated, in part:
We cannot agree that the facts of this case, in the board's words, "does not establish a mistake as to the facts or law, but simply indicate a lack of due diligence." The board accepted the declaration of attorney Fluss as credible testimony. So viewed, it plainly discloses that in 1981 Fluss made an inadvertent error, and committed an act of excusable neglect. [Footnote.] Fluss declared, not that he had failed to ascertain the facts, but that in the midst of a heated discussion of other issues, he "simply overlooked" the discrepancy between the facts as stipulated and the facts "as they existed." It is implicit that he knew his client had been temporarily disabled from working. Yet he ratified a stipulation which purported to establish, much to his client's detriment, and without gaining any reciprocal advantage, the exact opposite.
This act surely was inadvertent. It was also excusable, in view of the indirect and casual manner in which the second stipulation was made....
In a footnote, the Court stated, in part:
An act is inadvertent if it is the product of inattention or oversight, or is unintentional (Webster's New College Dict. (1977) p. 578.) Excusable neglect is that neglect which might have been the act of a reasonably prudent person under the same circumstances. (Tammen v. County of San Diego (1967) 66 Cal.2d 468, 476.)
However, where there has been no mistake but merely a lack of full knowledge of the facts, which was due to the failure of a party to exercise due diligence to ascertain them, there is no proper ground to set aside a stipulation. (Harris v. Spinali Auto Sales Inc. supra, 240 Cal.App.2d 447.) See Brannen v. W.C.A.B. (1996) 61 Cal.Comp.Cases 554 (Published), discussed in detail in section 20.1.13 of this book. See also Salazar, Estate of, v. W.C.A.B. (2020) 85 Cal.Comp.Cases 681 (Writ Denied), where the Court discusses the difficulty withdrawing from a stipulation.
In Oxnard School District, et. al., v. W.C.A.B. (Garcia) (2016) 81 Cal.Comp.Cases 69 (Writ Denied), the Appeals Board in finding that the defendant was bound my a stipulation as to applicant's entitlement to permanent disability noted that the party seeking to rescind a stiuptlaiton contract must prove that:
1. The party was mistaken as to a material fact,
2. the opposing party knew of the mistake and used it to his advantage,
3. the mistake was not caused by the neglect of a legal duty on the party making the mistake, and
4. that the party would not have entered into the contract had it known of the mistake.
In City of Monterey Park v. W.C.A.B. (Wood) (1983) 48 Cal.Comp.Cases 160 (Writ Denied), the Appeals Board refused to allow the City of Monterey Park to be relieved from its stipulation that a retired police officer was entitled to rehabilitation temporary disability benefits because the Board concluded that the city, had it exercised reasonable diligence, would have discovered prior to entering into the stipulation that a member of the Public Employees' Retirement System, as the police officer was, is not entitled to rehabilitation temporary disability indemnity benefits subsequent to retirement.
When parties entering into a stipulation knowingly take the risk of unsettled law and their settlement agreement reflects such basis for their stipulation, there is no good cause to reopen if subsequent appellate Court decisions clarify the law. Fireman's Fund Insurance Company v. W.C.A.B. (Allen) (2010) 75 Cal. Comp.Cases 1, 181 Cal.App.4th 752, 104 Cal.Rptr.3d 641 (Published).
An agreement or stipulation made in the presence of a Workers' Compensation Judge, although not reduced to writing and signed by the parties, may constitute a stipulation once the agreement is entered in the minutes of hearing. (Huston v. W.C.A.B. (1979) 44 Cal.Comp.Cases 798, (Published).) However, if the stipulation on which the award was made was entered into through inadvertence, excusable neglect, fraud, mistake of fact or law, or where special circumstances exist rendering it unjust to enforce stipulation, the stipulation may be set aside and a new award issued pursuant to Labor Code section 5803. See Benavides v. W.C.A.B. et al. (2014) 79 Cal.Comp.Cases 483 (Unpublished) and Antouri v. W.C.A.B. (2016) 81 Cal.Comp.Cases 604 (Writ Denied).
A stipulation may be a substitute for proof and, if within the authority of the attorneys offering the stipulation, is binding on the parties. It is also binding on the Court where it is not contrary to law, Court Rule, or policy. (Capital National Bank v. Smith (1944) 62 Cal.App.2d 328, 144 P.2d 665 (Published); Estate of Burson (1975) 51 Cal.App.3d 300, 124 Cal.Rptr. 105 (Published); Greatorex v. Board of Administration of the City Employee's Retirement System of The City of San Diego (1979) 44 Cal.Comp.Cases 553 (Published).) The employee as well as his or her attorney should sign the stipulation. All medical reports in the possession of both parties must be filed with the stipulations if they have not previously been filed with the Board. Stipulation forms may be obtained from any Board office.
Obviously, a stipulation may be reopened within five years from the date of injury, under Labor Code section 5803, if there exists some grounds, not within the knowledge of the party at the time of making the former decision (stipulation) which makes the original award inequitable. See Weishaar v. W.C.A.B. (2004) 69 Cal.Comp.Cases 151 (Writ Denied), where the Board reduced an award of 100 percent to 49 percent based on sub rosa films showing the applicant performing activities inconsistent with the level of disability that qualified the prior 100 percent stipulation.
In Edgington v. W.C.A.B. (2007) 72 Cal.Comp.Cases 1153 (Writ Denied), fraud was found, by the Board, to constitute good cause to set aside a stipulation. The Board, in its decision, stated, in part:
It is our constitutional mandate ''to accomplish substantial justice in all cases . . . '' (Cal. Const., Article XIV, § 4.) The public policy of the state to deny fraudulent workers' compensation claims would be turned on its head if there was no consequence to applicant. One should not profit from his own fraud. Holding applicant accountable for his fraudulent conduct accomplishes substantial justice and is consistent with the overriding public policy favoring the disposition of cases on their merits. (See Denham v. Superior Court of Los Angeles County (1970) 2 Cal.3d 557 [86 Cal. Rptr. 65, 468 P.2d 193]; Bland v. Workmen's Comp. Appeals Bd. (1970) 3 Cal.3d 324 [90 Cal. Rptr. 431, 475 P.2d 663] [35 Cal. Comp. Cases 513]; Marino v. Workers' Comp. Appeals Bd. (2002) 103 Cal.App 4th 485 [126 Cal. Rptr. 2d 812] [67 Cal Comp. Cases 1273].)
Defendant would not have stipulated to industrial causation if applicant and others had not conspired to hide the truth about the circumstances of the injury. We will not condone applicant's wrongdoing by denying defendant relief from the June 6, 2003 stipulation. The decision of the WCJ is reversed. [Emphases by WCAB]….
Stipulation to Reserve Jurisdiction
If the parties stipulate that an issue, such as permanent disability, is reserved for future determination, any party may file a Declaration of Readiness to Proceed more than five years after the date of injury and need not file a Petition to Reopen within five years within the date of injury pursuant to Labor Code section 5410. Verizon Communications v. W.C.A.B. (Head) (2013) 78 Cal.Comp.Cases 1353 (Writ Denied). See also section 20.12.5 of this book for a discussion of cases involving reserving jurisdiction in progressive disease cases.
Agree to Pay, Adjust, or Litigate a Lien
If a defendant stipulates to an Award wherein it agrees to "pay, adjust, or litigate" a lien, the lien claimant may file a Declaration of Readiness to Proceed, even more than five years after the injury was incurred as such an agreement defeats both the defenses of the Statute of Limitations and laches. San Bernadino (Hansen) (2012) 78 Cal.Comp.Cases 232 (Writ Denied) and Kern Labor Contracting (2012) 2012 Cal.Wrk.Comp.P.D. LEXIS 321 (Panel Decision).