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June 22, 1990.


American States Insurance Company (American) filed a declaratory judgment action, following a workers compensation case, against Hanover Insurance Company (Hanover). The trial court denied Hanover's motion to dismiss the case for lack of jurisdiction, and this court granted an interlocutory appeal.

In the workers compensation case, an injured workman, Robert C. Miller, filed a claim against both J.G. Shull Co. (Shull), who is insured for workers compensation purposes by American, and A.F. Byers & Co. (Byers), which is insured for workers compensation purposes by Hanover. Since Shull and Byers are no

[14 Kan. App. 2d 493]

      longer parties and their insurance carriers stand in their shoes, Shull and American will be referred to as American, and Byers and Hanover will be referred to as Hanover.

The Administrative Law Judge (ALJ) issued a preliminary order for American to pay the claimant's medical and temporary total disability compensation. The ALJ specifically reserved the question of any liability of Hanover.

  American then made a compromise settlement of the workers compensation claim for $44,625.37. Prior to the settlement, American filed a declaratory judgment action seeking a declaratory judgment that Hanover is liable for past and future benefits paid and alleging that the Division of Workers Compensation "lacks the power to determine and fix a comparative degree of liability" between American and Hanover.

  We are furnished a meager record on appeal, which consists of the petition for declaratory judgment, the journal entry denying the motion to dismiss (which contains no findings or conclusions and gives no clue as to the trial court's reasons for denying the motion), Hanover's motion to dismiss, and a one-paragraph memorandum in support of the motion to dismiss. The record also contains a second motion to dismiss and the trial court's bench notes. Appellant has attempted to supplement the record in the appendix to the brief. Appendices to a brief are not a substitute for a record. See In re Appeal of News Publishing Co., 12 Kan. App. 2d 328, 333, 743 P.2d 559 (1987). The record furnished makes it very difficult to review the case. We cannot tell from the record whether a workers compensation claim is still pending against Hanover, although at oral argument we were assured the workers compensation case was concluded and that there is no pending claim. We have some difficulty determining what the trial court decided.

  Hanover filed a motion on November 22, 1988, requesting dismissal of American's petition "for the reason that this Court lacks subject matter jurisdiction over the action and that plaintiff has failed to exhaust its administrative remedies." A one-page memorandum citing two federal cases and one Kansas Supreme Court case accompanied the motion. The trial court heard argument and deferred its decision "pending decision of Administrative Law Judge." Presumably, the benchnote entry refers to

[14 Kan. App. 2d 494]

      the workers compensation case. The record contains nothing concerning the workers compensation claim after that date. Both briefs contain copies of various documents in their appendices that show the workers compensation claim was settled, but indicate a workers compensation claim was still pending against Hanover when Hanover filed a second motion to dismiss American's petition.

  In its second motion to dismiss, American claimed it had filed a Form 12 "Worksheet for Settlement" in the workers compensation case admitting Shull was the employer and American the insurance carrier and that the admission mooted the declaratory judgment action. A copy of the Form 12 is attached to the motion and is part of the record before us.

  The trial court then denied the motion. The journal entry denying the motion to dismiss states, in pertinent part, "that defendant's motion to dismiss plaintiff's petition on the ground that the issue of which carrier extends coverage for the respondent in the workers compensation claim [is] not within the jurisdiction of the district court should be and is hereby overruled."

  On appeal, Hanover makes three arguments: (1) The ALJ had the power to decide the identity of the claimant's employer; (2) by settling with claimant, American waived any rights it had to have the ALJ decide the issue of who the employer was and; (3) the declaratory judgment action should have been dismissed for failure to exhaust administrative remedies.

  American responded that the district court, and not the workers compensation proceeding, is the proper forum to litigate "as the rights of the claimant are not at issue." American argued on appeal that it reserved all rights and claims to proceed with an independent action to determine liability and apportionment between the parties. The problem with this argument is that, if we assume American could reserve the right to an independent order, there is nothing in the record before us to show American did so. (The appendix to American's brief has material that, if it were in the record, would do so.)

  American also argues it had exhausted all administrative remedies and that, since Hanover did not raise waiver in the trial court, the issue of waiver cannot be raised for the first time on appeal.

[14 Kan. App. 2d ...

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