MURILLO v. AIU (2026)

¶ 1 In this workers’ compensation action, Lusia Murillo appeals the final order of the Industrial Claim Appeals Office (Panel) reversing the orders of an administrative law judge (ALJ) granting her petition to reopen her workers’ compensation claim and awarding her benefits.

¶ 2 This case presents a question of first impression: whether a claimant whose claim was closed for failure to prosecute may reopen it based on “a change in condition” under section 8-43-303(1), C.R.S. 2026, of the Workers’ Compensation Act of Colorado (the Act), when compensability had been neither admitted nor determined before closure. We hold that a claim may be reopened on the basis of a change in condition only if, before the claim was closed, there was an admission or a determination that the claimant sustained a compensable injury.

¶ 3 Because no such admission or determination was made before the closure of Murillo's claim for failure to prosecute, we affirm the Panel's decision.

I. Background

¶ 4 Murillo contends that she suffered a lower back injury while working as a housekeeper for her employer, the Ritz-Carlton Bachelor Gulch. She filed a timely claim for workers’ compensation benefits. Her employer and its insurer (jointly, the Employer) responded by filing a notice of contest, denying liability for the claim.

¶ 5 Six months later, the Employer filed a petition to close the claim based on Murillo's failure to prosecute, contending that she had taken no action since filing her claim. The Director of the Division of Workers’ Compensation (Director) issued an order requiring Murillo to show cause within thirty days why her claim should not be closed. The order warned Murillo that, if she failed to timely respond, her claim would automatically close after thirty days. When Murillo did not respond to the show cause order, the claim was closed.

¶ 6 A few months later, Murillo filed a petition to reopen her claim and an application for a hearing on multiple issues — compensability, medical benefits, and temporary disability benefits. A prehearing ALJ ordered a bifurcated hearing, with the petition to reopen to be addressed first. Only if the petition was granted would the hearing proceed to the substantive issues.

¶ 7 At the hearing, Murillo argued that her claim should be reopened because her condition had “worsened” since her claim was closed. She testified that her back pain had increased since that time and that she was using over-the-counter medications to manage it.

¶ 8 The Employer responded that, as a matter of law, her petition could not succeed. Specifically, the Employer asserted, “[I]n order for an ALJ to assess whether a claimant's condition has changed, the claimant must have proved a compensable condition prior to the workers’ compensation claim closing.”

¶ 9 Following the hearing, the ALJ granted Murillo's petition to reopen her claim. The ALJ said that section 8-43-207(1)(n), C.R.S. 2026 — the failure to prosecute provision — did not apply to Murillo's case and that her claim should not have been closed. That provision, according to the ALJ, “allow[s] [the Employer] an avenue for closing cases in situations where benefits have been admitted, but no action has been taken by the injured worker to pursue said benefits.”

¶ 10 The ALJ then applied section 8-43-303 to reopen Murillo's claim, pointing out that the show cause order specifically advised her “that if the claim was closed for failure to prosecute, [it] could still be reopened pursuant to section 8-43-303, C.R.S. in the future.” The ALJ determined that Murillo met her burden under section 8-43-303(1) of proving that her condition had worsened based on her testimony that her back pain had increased since the claim was closed.

¶ 11 The ALJ later held another hearing to address Murillo's request for benefits related to the medical treatment she received at Vail Valley Health following her work injury. In a written order, the ALJ found that the treatment included examinations, telehealth conferences, physical therapy, x-rays, and an MRI, and that the cost of the treatment was reasonable and necessary to treat Murillo's work-related injury. The ALJ thus awarded Murillo the cost of such treatment.

¶ 12 The Employer appealed to the Panel both the order granting Murillo's petition to reopen and the order awarding her benefits. Relying on Amin v. Industrial Claim Appeals Office, (Colo. App. No. 17CA2165, Oct. 25, 2018) (not published pursuant to C.A.R. 35(e)),¹ the Panel set aside both orders and denied Murillo's petition to reopen. The Panel concluded that section 8-43-207(1)(n) applies to all cases, not just those in which the employer admitted benefits. However, it determined that a claim closed without an order on compensability cannot be reopened based on a “worsened condition” under section 8-43-303(1). Instead, it concluded that Murillo was limited, as relevant here, to reopening her claim by demonstrating that “the closure of the compensability issue was the result of error or mistake.” Thus, the Panel found the ALJ erred by reopening Murillo's claim based on a change in condition.

¶ 13 Murillo now appeals the Panel's order.

II. Standard of Review and Governing Law

¶ 14 “We review matters of statutory construction de novo.” City & County of Denver v. Indus. Claim Appeals Off., 2021 COA 146, ¶ 18. Our primary objective in interpreting a statute is to ascertain and effectuate the legislature's intent. Sentinel Colo. v. Rodriguez, 2025 CO 58, ¶ 18. We begin with the plain and ordinary meaning of the statutory language, considering its words and phrases in context. Id. We read the statute as a whole, giving consistent, harmonious, and sensible effect to all its provisions. Id. In doing so, we consider how the statute's subparts interact and construe its provisions to be consistent with the overall statutory scheme. Id. We avoid interpretations that lead to illogical or absurd results. Id.

¶ 15 We likewise review administrative rules de novo, applying the same rules of construction as we would in interpreting a statute. Winter v. Indus. Claim Appeals Off., 2013 COA 126, ¶ 9. If the language of the rule is clear, we interpret it according to its plain and ordinary meaning. Id. at ¶ 8. “The provisions of an administrative rule should be read in connection with and in relation to each other, so that the rule itself may be interpreted as a whole.” Id. at ¶ 9.

¶ 16 Section 8-43-207(1)(n) authorizes the Director and ALJs to dismiss issues, including all unresolved issues in a case, for failure to prosecute:

(1) Hearings shall be held to determine any controversy concerning any issue arising under articles 40 to 47 of this title 8. In connection with hearings, the [D]irector and [ALJs] are empowered to:

․

(n) Dismiss all issues in the case except as to resolved issues and except as to benefits already received, upon thirty days notice to all the parties, for failure to prosecute the case unless good cause is shown why such issues should not be dismissed. For purposes of this paragraph (n), it shall be deemed a failure to prosecute if there has been no activity by the parties in the case for a period of at least six months.

¶ 17 In turn, Rule 7-1(C) of the Workers’ Compensation Rules of Procedure provides as follows:

When no activity in furtherance of prosecution has occurred in a claim for a period of at least [six] months, a party may request the claim be closed.

․

(3) Following receipt of a request to close a claim, the Director may issue the order to show cause why the claim should not be closed. If no response is mailed or delivered within [thirty] days of the date the order was mailed, the claim shall be closed automatically, subject to the reopening provisions of § 8-43-303 ․

Div. of Workers’ Comp. Rule 7-1(C), 7 Code Colo. Regs. 1101-3 (WCRP 7-1(C)); see § 8-47-107, C.R.S. 2026 (authorizing the Director to adopt “reasonable and proper rules relative to the administration of [the Act]”).²

¶ 18 Under the reopening statute, “[t]he party attempting to reopen an issue or claim shall bear the burden of proof as to any issues sought to be reopened.” § 8-43-303(4). As relevant here, section 8-43-303(1) sets forth the criteria for “reopening” a workers’ compensation “award”:

At any time within six years after the date of injury, the director or an [ALJ] may, after notice to all parties, review and reopen any award on the ground of fraud, an overpayment ․, an error, a mistake, or a change in condition ․

¶ 19 Courts have interpreted this provision broadly. See City & County of Denver, ¶ 27 (holding that receipt of limited partial disability benefits based on the employer's final admission of liability constitutes an “award” that “became final when the claim was closed for failure to prosecute”); Brown & Root, Inc. v. Indus. Claim Appeals Off., 833 P.2d 780, 784 (Colo. App. 1991) (noting that “an order dismissing the claim or closing the file” for failure to prosecute “constitutes an ‘award’ under the reopening statute”). Based on this broad interpretation and consistent with WCRP 7-1(C), we conclude that an order closing a claim for failure to prosecute constitutes an “award” within the meaning of section 8-43-303(1).³

III. Change in Condition

¶ 20 Murillo argues that the Panel misconstrued section 8-43-303(1) by adopting an analysis that “precludes the claimant from raising the original issue of compensability at a later time by asserting this unproven injury has worsened.” According to Murillo, the statute does not require a determination of compensable injury before the claim was closed. While Murillo is correct that section 8-43-303(1) contains no express requirement that compensability be determined before closure, Colorado case law has interpreted “a change in condition” to require such a determination.

¶ 21 WCRP 7-1(C) provides that any claim closed for failure to prosecute is “subject to the reopening provisions of [section] 8-43-303.” Under section 8-43-303(1), an ALJ may reopen a “closed claim” on grounds of fraud, overpayment, error, mistake, or change in condition. Justiniano v. Indus. Claim Appeals Off., 2016 COA 83, ¶ 8 (referring to reopening “a closed claim” rather than an “award”). Murillo asserts that her claim should be reopened solely based on a change in condition.

¶ 22 “[C]hange in condition,” as used in section 8-43-303(1), refers to “a change in the condition of the original compensable injury or to a change in claimant's physical or mental condition which can be causally connected to the original compensable injury.” Heinicke v. Indus. Claim Appeals Off., 197 P.3d 220, 222 (Colo. App. 2008) (quoting Chavez v. Indus. Comm'n, 714 P.2d 1328, 1330 (Colo. App. 1985)); Cordova v. Indus. Claim Appeals Off., 55 P.3d 186, 189 (Colo. App. 2002). Thus, the statute presupposes that the claimant's original injury was “compensable.” “[W]hether [a] claimant sustained a compensable injury is a question of fact to be determined by the ALJ.” Salazar v. Indus. Claim Appeals Off., 2022 COA 13, ¶ 17. Absent such a determination of compensability — or the employer's admission that the injury is compensable — an original injury cannot be deemed compensable for purposes of section 8-43-303(1).

¶ 23 Therefore, a claim may be reopened based on a change in condition only if, before the claim was closed, there was an admission or a determination that the claimant sustained a compensable injury.

¶ 24 Two cases illustrate why this conclusion is consistent with Colorado workers’ compensation jurisprudence. In Chavez v. Industrial Commission, 714 P.2d 1328, 1329 (Colo. App. 1985), the claimant suffered a work-related injury to her right ankle, and the employer admitted liability for permanent impairment. Id. After the claim was closed, the claimant's right ankle gave out, causing her to fall and break her left ankle. Id. She sought to reopen her claim based on a change in condition. The claimant's doctor opined that the left ankle fracture was likely due to the previous injury to the right ankle. Id. The hearing officer found that her condition had worsened, reopened the claim, and awarded benefits. But the Industrial Commission reversed, finding there was insufficient evidence that the “claimant's right ankle condition had worsened.” Id. at 1329-30.

¶ 25 On appeal, a division of this court held that a “change in condition” as used in the predecessor statute to section 8-43-303(1) means

a “change in the claimant's physical or mental condition resulting from the compensable injury.” Thus, “change in condition” refers either to a change in the condition of the original compensable injury or to a change in claimant's physical or mental condition which can be causally connected to the original compensable injury.

Here, both the doctor's report and claimant's testimony established that her “weak right ankle that she previously injured” caused the injury to her left ankle. This was a change in her physical condition resulting from the original compensable injury. Hence, the Commission erred in not adopting this finding of the hearing officer.

Id. at 1330 (citations omitted).

¶ 26 In City & County of Denver v. Industrial Claim Appeals Office, 58 P.3d 1162, 1163 (Colo. App. 2002), the claimant sustained a work-related injury in a car accident and received a lump sum award based on a 26% whole person impairment rating. Id. Later, she petitioned to reopen her claim due to a worsened condition and was re-rated at 9% impairment. Id. Based on this reduced rating, the employer asserted an overpayment. Id. The claimant challenged the decreased rating and requested a division-sponsored independent medical examination (DIME). Id. When a DIME physician assigned a 0% rating, the employer increased its overpayment claim. Id. at 1164. Ultimately, the ALJ found that the claimant's condition had not improved after reopening and denied the employer's request to recover the lump sum benefit. Id.

¶ 27 On appeal, a division of this court affirmed. In rejecting the employer's argument that the claimant was bound by the DIME's 0% impairment rating and that the employer was automatically entitled to recoup the “overpaid” lump sum benefits, the division held,

After a case is reopened based on a change in condition, the causation issue is limited to whether there is a change in the claimant's physical or mental condition that can be causally connected to the original compensable injury. See Cordova v. Indus. Claim Appeals Office, 55 P.3d 186 (Colo. App. 2002). The original finding of causation has already been conclusively litigated and therefore cannot be challenged in reopening or post-reopening proceedings. See 8 Larson's Workers’ Compensation Law § 131.03(2)(a) (2001) (reopening based on a change in condition does not permit relitigation of every potential issue because the question is restricted to the “extent of improvement or worsening of the injury on which the original award was based”; “neither party can raise original issues such as work-connection, employee or employer status, occurrence of a compensable accident, and degree of disability at the time of the first award”); cf. Sunny Acres Villa, Inc. v. Cooper, 25 P.3d 44, 45 (Colo. 2001) (causation established at temporary disability stage could be relitigated at permanent disability stage, because employer did not have same incentive to fully litigate causation at first stage).

Thus, the change must be measured from claimant's condition when the claim was closed, as established in the original proceeding, and to her condition after reopening.

City & County of Denver, 58 P.3d at 1164.

¶ 28 Applying these cases, we agree with the Panel that Murillo could not reopen her claim based on a change in condition because, before the closure, there was no admission or determination that she sustained a compensable injury. The Employer contested compensability, and Murillo's claim was automatically closed after she failed to prosecute her claim for at least six months. See § 8-43-207(1)(n); WCRP 7-1(C). Because no compensability finding or admission of compensability was made before the closure, the ALJ erred by reopening the claim based on a change in condition. And on reopening, Murillo was prohibited from raising “original issues” such as compensability and work-connection. City & County of Denver, 58 P.3d at 1164 (quoting 8 Larson's Workers’ Compensation Law § 131.03(2)(a) (2001)).

¶ 29 We are not persuaded otherwise by Murillo's contention that section 8-43-303(1) contains no requirement that a compensable injury be determined before a claim is closed. First, as explained above, an injury cannot be deemed compensable before an ALJ determines it is compensable when, as here, the employer contests compensability. Second, “a change in condition” means a change in condition since the original award. See, e.g., id. As Larson's Workers’ Compensation Law explains,

(a) Reopening May Not Be Used to Retry Original Issues

[In c]hange-of-condition reopening proceeding, the issue before the Board is sharply restricted to the question of extent of improvement or worsening of the injury on which the original award was based. If the original award held that there was no connection between the accident and claimant's permanent disability, there is nothing to reopen, and claimant cannot retry the issue of work-connection through the device of a reopening petition. Conversely, when the employee reopens to show increased disability, the insurance carrier cannot raise the basic issue of liability. In short, no matter who brings the reopening proceeding, neither party can raise original issues such as work-connection, employee or employer status, occurrence of a compensable accident, and degree of disability at the time of the first award.

13 Lex K. Larson & Thomas A. Robinson, Larson's Workers’ Compensation Law § 131.03(2)(a) (2026) (emphasis added) (footnotes omitted). Because there was no admission or finding of compensability before Murillo's claim was closed, the “change in condition” provision does not provide a basis for reopening.

¶ 30 Our interpretation is also consistent with the purposes of the Act. As the Panel explained,

The preamble to the [Act] explains that the intent of the [G]eneral [A]ssembly is to assure the quick and efficient delivery of benefits to injured workers at a reasonable cost to employers and “without the necessity of any litigation.” § 8-40-102(1)[, C.R.S. 2026]. Consistent with this stated purpose, § 8-43-207(1)(n) stipulates that an employer may expect that a worker claiming an injury will take the steps necessary to prove the compensability of that injury within six months of the employer's notice of contest regarding the claim. In the absence of that activity, the employer is given the statutory ability to request that the claim be closed without further litigation. To excuse their neglect, the statute requires that the workers must show “good cause” for their “failure to prosecute the case” within the six month period.

In the event the claimant delays the prosecution of the compensability dispute beyond six months, and the director orders the issue dismissed, allowing the claimant another opportunity to litigate the compensability issue upon a petition to reopen filed at any point within the six years allowed by § 8-43-303, would render the terms of § 8-43-207(1)(n) largely meaningless. Through the device of a petition to reopen the claimant could choose to ignore the director's order and demonstrate his injury as compensable at ․ some other, later, time selected by the claimant.

(Emphasis added.) We agree with the Panel's reasoning. Permitting a claimant to establish compensability for the first time through a petition to reopen based on a change in condition would circumvent the requirement that the claimant prosecute the case within six months of the employer's notice of contest. See § 8-43-207(1)(n).

¶ 31 Finally, Murillo contends that the Panel's order bars her from ever litigating compensability because it requires an original determination that she sustained a compensable injury. While that is true to the extent she sought to reopen her claim for “a change in condition,” she had other avenues to reopen her claim under the statute. Section 8-43-303(1) permits the reopening of a workers’ compensation claim on five grounds: fraud, overpayment, error, mistake, or change in condition. For instance, Murillo could have litigated the compensability of the original claim if she had shown that her claim was closed due to fraud, error, or mistake. Those reasons excuse a claimant's failure to prosecute the claim within the six-month window specified in section 8-43-207(1)(n). In contrast, a claimant's inaction while waiting to see whether the claimant's condition will worsen cannot justify the claimant's purposeful failure to timely move the claim along and contradicts the Act's purpose to “assure the quick and efficient delivery of disability and medical benefits to injured workers.” § 8-40-102(1).

¶ 32 Murillo did not show fraud, error, or mistake. Rather, she sought to reopen solely based on a change in condition. The Panel therefore reasonably concluded that Murillo could not establish a change in condition because no compensable injury had been found before closure. But that does not mean Murillo was foreclosed from pursuing one of the other avenues for reopening a claim enumerated in section 8-43-303.

¶ 33 Accordingly, we conclude the Panel did not err by holding that Murillo could not reopen her claim based on a change in condition.

IV. Other Contentions

¶ 34 Murillo takes issue with the Panel's statement that section 8-43-207(1)(n) “provides that compensability ․ may be required to be adjudicated within an approximately six-month period following the dispute of the issue.” Murillo argues that this creates a new, shorter statute of limitations than the two-year period in section 8-43-103, C.R.S. 2026.

¶ 35 But Murillo takes the Panel's statement out of context. As the Panel clarified,

The two statutory sections address distinct requirements involved in the claimant's submission of a claim for benefits. Section 8-43-103(2) sets a limit on the time following an injury during which a claimant must give notice that the claimant believes they were injured in the workplace. In contrast, § 8-43-207(1)(n) is aimed at the resolution of that claim once it has been filed. These are periods that do not normally overlap. The six-month time span regarding the latter period does not represent an inconsistency with the two year duration of the former period.

We agree with this analysis.

¶ 36 Applying both statutes as written does not shorten or otherwise alter the two-year statute of limitations. Section 8-43-103 simply requires that a claim be filed within two years of the injury; it does not address what happens after the filing. Once a claim is filed, section 8-43-207(1)(n) and WCRP 7-1(C) require the claimant to actively prosecute the claim. Because Murillo took no action to advance her claim for at least six months and did not respond to the Director's show cause order, the Director properly closed her claim. See WCRP 7-1(C).

¶ 37 Murillo also challenges the Panel's description of the ALJ's interpretation of section 8-43-207(1)(n). The ALJ stated that this section provides “an avenue for closing cases in situations where benefits have been admitted, but no action has been taken by the injured worker to pursue said benefits.” Murillo argues that the Panel mischaracterized the ALJ's ruling as saying a claim cannot be closed for failure to prosecute under section 8-43-207(1)(n) if “benefits have not been admitted.” Even if there was a mischaracterization, it had no effect on the Panel's decision. The Panel's ruling turned on its interpretation of “a change in condition” under section 8-43-303(1), not on the ALJ's interpretation of section 8-43-207(1)(n). Thus, any alleged mischaracterization was immaterial.

¶ 38 Murillo next contends that the Panel conflated the standard for closing a claim for failure to prosecute with the burden required to reopen a closed claim. True, the Panel observed that an ALJ's discretion to reopen a claim for “mistake or error” is “parallel to the ALJ's latitude when ruling on the § 8-43-207(1)(n) ‘good cause’ to relieve the claimant of sanctions for failure to prosecute their claim.” But the Panel clarified that “relying solely on evidence intended to show the closed issue itself could be proven by a preponderance of the evidence, without first addressing a mistake or error to account for the delay in the prosecution, would not fulfill the requirements” of section 8-43-303(1). Even if the Panel did conflate the two standards, it made no difference to the outcome because Murillo did not seek to reopen her claim on the basis of “mistake or error.” See C.A.R. 35(c) (errors not affecting substantial rights may be disregarded).

¶ 39 Murillo further asserts that the Panel misread the reopening statute to require that a claim closed for failure to prosecute can be reopened only for “mistake or error.” The statute, however, lists fraud, overpayment, mistake, error, or change in condition as grounds for reopening. § 8-43-303(1). Whether these grounds exist depends on the specific facts of each case. If the Panel implied that only “mistake or error” could justify reopening after a failure to prosecute, that was incorrect. Nevertheless, the error was harmless. See C.A.R. 35(c). As explained above, Murillo could not establish a change in condition in the absence of an original finding of a compensable injury. Nor did she seek reopening on any other statutory ground. Accordingly, her petition could not be granted as a matter of law.

¶ 40 Finally, Murillo argues that the Panel's decision contravenes the Act by concluding that section 8-43-207(1)(n) “places a premium upon the need for timely activity” in resolving compensability. Although the Panel's use of “premium” may be imprecise, this characterization was not critical to its application of the reopening statute or its ultimate conclusion. To the extent the Panel intended to emphasize the importance of timely prosecution, we find no conflict between that view and the Act's purpose. The Act is designed to “assure the quick and efficient delivery of disability and medical benefits to injured workers at a reasonable cost to employers.” § 8-40-102(1); Anderson v. Longmont Toyota, Inc., 102 P.3d 323, 331 (Colo. 2004). Timely prosecution, therefore, advances the Act's purpose by promoting the prompt resolution of benefit claims.

V. Disposition

¶ 41 We affirm the Panel's order.

FOOTNOTES

1.   Consistent with our policy, we cite the unpublished opinion only to explain the case history. See Colo. Jud. Branch, Court of Appeals Policies, Policy Concerning Citation of Opinions Not Selected for Official Publication (2026), https://perma.cc/ZQW2-H29D.

2.   Section 8-43-207(1)(n), C.R.S. 2026, uses the terms “dismiss” and “issues,” while WCRP 7-1(C) uses “close” and “claim.” The parties do not address the apparent inconsistency in this language. For purposes of this appeal, we need not resolve the arguable inconsistency, as both parties agree that Murillo's claim was properly closed for failure to prosecute, subject to the reopening provisions of section 8-43-303, C.R.S. 2026.

3.   Importantly, the parties agree that the closure of a claim for failure to prosecute constitutes an “award” under section 8-43-303. They simply dispute whether Murillo satisfied the reopening criteria under section 8-43-303(1).

Opinion by JUDGE YUN

JUDGE LIPINSKY and JUDGE SCHUTZ concur.