Connolly, J.
This workers' compensation appeal presents a due process issue. The original trial judge retired while the case was on appeal. The original trial judge found that the appellee, Adam Liljestrand, was permanently and totally disabled. The appellant, Dell Enterprises, Inc., doing business as The Dundee Dell (Dell), sought review with a three-judge review panel. The review panel remanded the cause because it was not clear how the judge had treated the presumption of correctness afforded to the vocational rehabilitation specialist's opinion of Liljestrand's disability. Dell appealed, and the Nebraska Court of Appeals
On remand, the case was assigned to a new trial judge, who reviewed the record and issued an order without an evidentiary hearing. The new trial judge found that Liljestrand had rebutted the presumption afforded to the specialist's opinion. We granted Dell's motion to bypass the Court of Appeals. We conclude that this procedure violated due process because the witnesses' credibility was relevant to the issues presented at trial. We reverse the order and remand the cause for a new trial.
Liljestrand originally injured his back in September 2001 while he was working for Dell as a bartender. After surgery, Liljestrand was given work restrictions of 30 pounds for lifting and no repetitive bending or twisting. He required alternative sitting or standing every 2 hours. In September 2002, the agreed-upon vocational rehabilitation specialist, Ronald Schmidt, concluded that Liljestrand had sustained a 60- to 65-percent loss of earning power. Schmidt recommended that Liljestrand attend college for retraining as a financial advisor. The original trial court awarded Liljestrand vocational rehabilitation, which ended in 2004. Liljestrand eventually secured a job as an independent contractor providing financial advice to clients regarding insurance and mutual funds. But he reported that the narcotic pain medications he had to take for his back pain made him groggy and sleepy. He felt unable to advise clients about their financial affairs. Because of his lack of mental acuity and inability to sit for prolonged periods, he also could not perform the work in a subsequent position he took in recruiting nurses. He was last employed in May 2008.
In 2010, the surgeon reexamined Liljestrand and determined that he was suffering from mechanical low-back pain and referred him to a pain clinic. He concluded that the restrictions that he originally ordered had not changed but deferred to the judgment of physicians who were currently treating Liljestrand's pain. A different physician, however, determined that Liljestrand had scar tissue from the surgery and further disk herniation that was causing his current pain. He diagnosed Liljestrand with "failed back syndrome" and determined that his condition had deteriorated since his 2002 loss of earning power evaluation. He believed that Liljestrand's medications were appropriate and that he was totally disabled.
In November 2010, Liljestrand's then vocational rehabilitation specialist, Stephen Schill, prepared a loss of earning capacity report. Schill believed that Liljestrand was unemployable and was permanently and totally disabled. In January 2011, Schmidt, the 2002 specialist, provided an updated loss of earning capacity report. Schmidt determined that Liljestrand had access to many sedentary jobs and that his loss of earning capacity was 34 percent. He discredited Schill's analysis and noted that Liljestrand's ability to care for his two preschool daughters while his wife worked showed that he had some flexibility and strength.
At the 2011 hearing, the sole issue was the nature and extent of Liljestrand's permanent disability. The trial court found
On appeal, the Court of Appeals determined that the review panel's order was final because it effectively vacated the trial judge's order, thus affecting Liljestrand's substantial right:
The Court of Appeals declined to infer that the trial judge had found the presumption rebutted, because Workers' Comp. Ct. R. of Proc. 11 (2011), as amended, requires sufficient findings to provide meaningful appellate review:
But the Court of Appeals noted that the trial judge had retired and could not render the new decision: "Thus, we leave the determination of who shall become the trial
The case was assigned to a new judge on remand, without instructions to conduct a new hearing. In December 2012, the new trial judge issued an "Award on Mandate" order. He concluded that the Court of Appeals' mandate required him to review the previous record and issue a new order. After reviewing the record, he concluded that the evidence presented at the trial had rebutted Schmidt's updated report. He noted that at the 2011 hearing, Schmidt believed Liljestrand's loss of earning capacity had decreased because of his vocational training. But Schmidt had admitted that he did not know the effect that Liljestrand's medications would have on his employability. The new trial judge concluded that Schmidt had not attempted to verify the effect of these medications but that the second physician's report had documented the effect of the medications. Because Schmidt did not consider this report or Liljestrand's reports of his actual experiences, his opinion was incorrect. In addition, based on the previous record, the new trial judge ruled that Liljestrand was permanently and totally disabled as of October 5, 2010, and awarded him permanent disability benefits of $508 per week.
Dell assigns that the court erred in (1) failing to conduct a new trial or abide by procedural due process requirements and (2) finding that Liljestrand was permanently and totally disabled.
The construction of a mandate issued by an appellate court presents a question of law.
Dell contends that the new trial judge violated its due process rights by issuing an order without notice or an opportunity to be heard on the meaning of the mandate, to present evidence, or to cross-examine witnesses. Dell argues the procedure was constitutionally deficient because a workers' compensation judge is the sole judge of the witnesses' credibility and the successor judge had no opportunity to assess their credibility. Instead, Dell argues the successor trial judge acted as an appellate judge by issuing an order based solely from his reading the record. It cites cases from other jurisdictions holding that due process requires a decision to be entered by the judge who heard the evidence and observed the witnesses.
Liljestrand, of course, sees it differently. He argues that the only issue on remand was whether the evidence had rebutted the presumption of correctness afforded Schmidt's report and that due process did not require a new trial on all the issues. But this argument ignores the effect of the Court of Appeals' decision and the trial court's rulings on remand.
The Court of Appeals found that it had jurisdiction over the first appeal because
That conclusion was the law of the case on remand, and the successor trial judge accordingly treated the original order as vacated. He did not limit his order to whether the evidence had rebutted the presumption. He also ruled on Liljestrand's entitlement to disability benefits, and Liljestrand argues on appeal that this finding was correct.
State courts generally agree that a successor judge may not make a decision based on conflicting evidence that a predecessor judge heard,
Moreover, the rule is consistent with the reason that we defer to a trial court's findings of fact. We have stated that in a bench trial of an action at law, the trial court is the sole judge of the witnesses' credibility and the weight to be given their testimony.
We need not consider here any exceptions that other courts have recognized because none are presented by this record. The parties did not consent to this procedure, and they clearly presented conflicting evidence at the original hearing whether the presumption should be rebutted. Moreover, the issues involved the credibility of witnesses.
It is true that Schmidt admitted to not considering the effect of pain medications on Liljestrand's ability to work. But he also testified that no physician provided him with restrictions based on Liljestrand's
We reverse, because the successor judge's ruling on these issues without a new evidentiary hearing violated Dell's right to due process. We remand the cause to the Workers' Compensation Court for a new trial.
REVERSED AND REMANDED FOR A NEW TRIAL.