Nev. Dep’t of Corrs. v. York Claims Servs. (Nev. Supreme Ct. – May 07, 2015)
NRS 616B.028(1) entitles a person to coverage under the modified program of industrial insurance established by regulations adopted by the State of Nevada Division of Insurance if that person is an offender confined at the state prison, while engaged in work in a prison industry or work program. The issue is whether the State or a private employer is responsible for workers’ compensation coverage for individuals injured while in a prison work release program. More specifically, does NRS 616B.028(1) apply to offenders participating in a work release program.
In 2010, Piper, who was convicted and imprisoned for burglary two years earlier, was transferred to Casa Grande Transitional Housing in Las Vegas, Nevada, to serve out the remainder of his sentence. Casa Grande is similar to a halfway house and is operated by the Nevada Department of Corrections (NDOC) for offenders participating in NDOC’s work release program. Among other various rules and restrictions, an offender at Casa Grande must either have a job or be in the process of searching for a job in the private sector.
Washworks Rainbow, LLC, a full-service car wash in Las Vegas, hired Piper to wipe down vehicles after they were washed. Washworks paid premiums on behalf of Piper to York so that Piper was covered under its workers’ compensation insurance coverage, just as Washworks did for all of its employees. After discovering that Piper had a background in gardening, Washworks’ owner, Olden, asked Piper to trim some trees on Washworks’ property. While trimming the trees, Piper fell off his ladder and struck his head on the ground. Piper, rendered unconscious by the fall, suffered a traumatic brain injury and was taken to the hospital. An emergency craniotomy was performed in order to accommodate brain swelling, essentially saving Piper’s life. Over the next four months, Piper underwent various brain surgeries and was transferred between hospitals and rehabilitation centers.
Following Piper’s injury, Olden submitted the standard insurance forms he used anytime an employee was injured. York, the workers’ compensation insurance provider for Washworks, notified Piper that it denied his claim from his ladder fall. York asserted that Piper was in the legal custody of NDOC while working at Washworks. Thus, York asserted that pursuant to NRS 209.492 and NRS 616B.028, NDOC was financially responsible for Piper’s workers’ compensation coverage under its own insurance program.
NDOC and the State of Nevada Risk Management (Risk Management) appealed York’s denial of coverage to the State of Nevada Department of Administration Hearings Division. The assigned hearing officer found that York’s denial of Piper’s claim was improper. The hearing officer concluded that York was responsible for coverage because Piper was injured in the course and scope of his employment at Washworks.
Eight days later, while walking around his recovery facility, Piper suffered a major seizure and fell, striking his head. Once again, Piper required emergency brain surgery. York notified Piper that it would not cover any medical charges following the date of his second head injury. York asserted that Piper’s second head injury was not work-related nor was it a result of his first head injury because the seizure was a nonindustrial intervening event.
Following York’s second coverage denial, Piper, NDOC, Risk Management, and York stipulated to forego the initial hearing on York’s second denial of coverage and consolidate both issues—York’s challenge of the hearing officer’s decision and Piper’s challenge of York’s second denial—before an appeals officer. The hearing officer granted the stipulation.
Following two days of hearings and written closing statements, the appeals officer was tasked with determining two issues. First, whether the hearing officer’s decision finding York responsible for Piper’s workers’ compensation coverage from his first injury was correct. Second, whether Piper’s seizure was an intervening act precluding York from responsibility for workers’ compensation coverage for Piper’s second injury.
The appeals officer found York liable for workers’ compensation coverage for both of Piper’s injuries. As to the first issue, the appeals officer found York liable because it found that Piper was an employee of Washworks. Further, the appeals officer found that York’s reliance on NRS 616B.028 was without merit. As to the second issue, the appeals officer again agreed with NDOC, finding that the first injury was the substantial contributing cause of Piper’s second injury.
York then petitioned for judicial review of the appeals officer’s decision. On review, the district court focused entirely on York’s NRS 616B.028 argument. The district court posited that the critical question was what did the legislature intend when it used the term “work program” in NRS 616B.028(1). After a plain-language reading, the district court found that “work program” in NRS 616B.028(1) included the work release program. Thus, the district court concluded that York was not responsible for workers’ compensation coverage because NDOC was responsible under NRS 616B.028(1). Accordingly, the district court set aside the appeals officer’s decision. NDOC appealed the district court’s order.
NDOC argued that the district court erred when it found that “work program” in NRS 616B.028(1) encompassed the work release program in which Piper participated. In response, York argued that the district court correctly determined that the plain and ordinary meaning of NRS 616B .028 showed that the work release program fell within the ambit of work program.
The Nevada Supreme Court concluded that “work program” in NRS 616B.028(1) is subject to more than one reasonable interpretation and is thus ambiguous. “Work program” could be broadly construed to include the work release program, as the district court concluded. It could also be narrowly construed to refer to a specific type of program under the auspices of the prison industries.
The original version of NRS 616B.028(1) was codified in 1989. It read, “while engaged in work in a prison industry program,” as opposed to today’s version, which reads “while engaged in work in a prison industry or work program.” The “or work” addition was implemented by the Legislature in 1995. The legislative history reveals that “or work” was added to curtail a specific situation in which inmates who were participating in prison work camps with the Division of Forestry were suing the Division of Forestry for failure to train and inadequate equipment.
The Court reasoned that while NRS 616B.028’s legislative history might not precisely state the extent of what “work program” was meant to encompass, it was clear that it did not contemplate the work release program under consideration here. The work release program is codified in NRS Chapter 213. Prison industries and programs concerning forestry are codified in NRS Chapter 209. There is no evidence indicating that the Legislature intended to expand NRS 616B.028(1) in 1995 to include the work release program, which was already enacted at the time, by adding “or work.”
Therefore, the Court concluded that “or work,” which was added to the statute in order to resolve issues surrounding inmates working for the Division of Forestry, merely clarified that NRS 616B.028(1) refers to prison industry programs codified in NRS Chapter 209, whether they take place inside the prison walls, e.g., producing license plates, or outside the prison walls, e.g., outdoor day-labor projects.
Accordingly, the Court reversed the judgment of the district court and reinstated the decision of the appeals officer, which held York liable for Piper’s workers’ compensation coverage for both injuries.