Pendergrass and Baglione reversals might prompt petitions to reopen.

Sunday, October 28, 2007 | 0

--By Paula Montgomery

Labor Code Section 5803 provides that the Appeals Board has continuing jurisdiction over all of its’ orders, decisions and awards, and that the original order, decision, or award can be rescinded, altered, or amended for “good cause.”

In a recent case, Gonzalez v. Zurich, the WCAB reopened a prior PD Award decided pursuant to the decision in Pendergrass I and reduced the rating to apply the new PDRS under the AMA guidelines, pursuant to the en banc decision in Pendergrass II. For the proactive adjuster, this provides an opportunity to review all decisions issued between Pendergrass I and Pendergrass II, and consider filing a Petition to Reopen in order to reduce the permanent disability rating.

Example:

A Findings and Award issued on 3/15/07 for a 2004 date of injury, resulting in a sedentary work restriction for the back. The condition became permanent and stationary after 1/1/05 and temporary disability was paid commencing in late 2004 and ending after January 2005. At the time the F&A issued the law required the WCJ to use the old PDRS, as Pendergrass I and Baglione I were then in effect.

Seven months have passed since the issuance of the F&A in March and we are now in October 2007. The claim originally rated 75% PD, which equals under the old rating schedule approximately $122k, plus a life pension. Under the new schedule, the AME/PQME assigns a Category III WPI, which results in 20% PD. Potentially the defendant could now save in excess of $100,000.00 by filing a Petition to Reopen to Reduce the PD Award.

Gonzalez case:

After receiving an F&A based upon the old PDRS, Mullen & Filippi proceeded to attempt to reduce, or amend the F&A, by filing a Petition to Reopen. Although at trial the WCJ would not allow the F&A to be amended, upon reconsideration the WCAB agreed with defendant’s argument that the Pendergrass II (and by analogy, Baglione II) decision constituted “new law”, thus providing the requisite good cause. Accordingly, defendant’s Petition to Reopen under Labor Code Section 5803 was granted. The WCJ was ordered to amend the Award to apply the new PRDS under Pendergrass II.

Impact:

This decision means that under similar circumstances, defendants can file a Petition to Reopen and seek to amend Awards that used the old law and old PDRS. Especially important are claims with higher ratings and life pensions, where application of the new PDRS could result in significant savings.

**Caveat:

This is a Panel WCAB decision only and is not binding precedent. Another WCAB Panel could decide a similar case differently and the original decision may yet be challenged on appeal.

Practice Tip: Identify Old Awards Ripe for Reopening

1] Generally this will involve cases with a 2004 date of injury, but can include any case where TD ended after 1/1/05. (Or, in Baglione cases, where the medical determination of PD occurred after 1/1/05.)

2] Review Awards which issued during the period between 1/24/07 when Pendergrass I issued and 4/6/07 when Pendergrass II was released.

3] Verify that the case remains within the five year period from the date of injury. (Again, the vast majority of such cases will have a 2004 date of injury.)

4] Review cases with higher ratings and/or life pensions. Make sure that the case has not already been substantially paid out. (As everyone is well aware, it is difficult to “un-pay” an applicant.)

5] File a LC Section 5803 petition IMMEDIATELY. Delay could result in Awards being fully paid out before the proceedings end.