Legal Odds and Ends

Saturday, December 17, 2005 | 0

by "Jake" Jacobsmeyer

Once a month or so I receive a message from Lexis advising me that they have posted new decisions to the California Compensation Cases. Many of the reported cases are ones that have already been the subject of my commentary during the preceding months. However included within the message are both decisions of the Courts of Appeal which are unpublished (upon which I almost never comment as we are specifically prohibited from citing these decisions as legal authority) and decisions which are reportable and citable as "writ denied" cases. Writ denied cases are reports of cases where a Petition for Writ of Review has been denied by the Court of Appeal.

Particularly in these days where we are looking for any source of medical authority for ongoing changes in the law, writ denied cases can provide some guidance on the law. Keeping in mind that these cases are interpretations decisions by the editors at Mathew Bender and Company (now owned by Lexis), I will periodically report on some of the more significant and hopefully useful cases where the Petition for Hearing has been denied by the courts and the principles identified in the case appear to be of relevance to the general workers' compensation community. Writ denied cases are citable as legal authority however they are persuasive only if there is no higher contrary authority and are not binding on trial courts. It is also important to note that there are frequently writ denied cases with conflicting decisions on what appear to be the same issue. It is therefore important to review the entire body of case law before placing too much reliance on such a low level of legal authority.

The following is a summary of a series of writ denied cases currently published in the California compensation cases:

1. HOLLAND v. WCAB, 70 CCC 1515:
Issue: Penalty and Sanctions

In this case the applicant attorney was sanctioned by the WCJ with her decision upheld on reconsideration, for filing what was deemed a frivolous and bad faith Petition for Penalties. The applicant attorney filed a Petition for Penalties asserting failure to pay a Compromise and Release appropriately but did not provide any additional details as to what the issue might be. When the parties appeared at the Mandatory Settlement Conference it turned out that what was claimed was $2.50 of interest. The defendant immediately paid the interest due and self-imposed a penalty of $.50. The workers' compensation judge denied the applicant's request for penalties holding that the delay was inadvertent, not unreasonable and that weighing of equities mandated the penalty was not appropriate. The WCAB also denied the request for penalty drawing on the new provisions of Labor Code section 5814(b), (c), (d) and (g) as amended in SB 899.

The trial judge determined that the applicant attorney's conduct in filing a Petition for Penalties and Declaration of Readiness to Proceed was frivolous and in bad faith where the only issue was a $2.50 interest claim and there was no effort to address the issue informally. The trial judge ordered the applicant attorney (not applicant) to pay attorney's fees in the amount of $1,520.00 for the efforts of attorney for defendant in defending the penalty issue.

Of particular interest also in this case was the fact that the Award was issued in 2001 and the claim for penalty was made more than two years later and after SB 899 had passed. Defendant not only paid the $2.50 once they were apprised of the issue but also imposed the self-imposed penalty on same. In spite of that applicant still asserted the penalty on the entire Compromise and Release of $15,000.00.

The WCAB was clearly not pleased with what it perceived as a waste of its resources on this issue.

2. AGUIRRE v. WCAB and CNA INSURANCE COMPANY, 70 CCC 1487
Issue: Psychiatric injury and 6 month rule

In this case the WCAB relying upon Wal-Mart Stores v. WCAB (2003) 112 Cal. App. 4th 1435, 68 CCC 1575 determined that applicant's psychiatric injury was barred pursuant to Labor Code section 3208.3(d) where the employee was employed with the specific employer for a period of less than six months before an admitted orthopedic injury but obtained employment out of a union hall with a group of employers who had a contract with the specific union.

Applicant had advanced the rather creative argument that since the injured worker was a Union employee for almost six years prior to the injury and had moved from job to job based upon assignments by the Union that the six years of employment should be strung together on the basis that the Union contract tied the employments together into, in effect, a single employment. The trial judge had accepted the argument holding that the employee was "constructively employed" by all of the employers who were contractually bound by the Union agreement.

The WCAB reversed holding Labor Code 3208.3 required a specific employer had to employ the injured worker for a period of six months prior to the development of the psychiatric injury in order for injury to be found on a psychiatric basis.

3. MELLO v. WCAB and SCIF, 70 CCC 1525
Issue: Apportionment to previously asymptomatic condition

This is an apportionment case in the post SB 899/Escobedo v. Marshall's world. The injured worker sustained an injury on 5/10/2002. She had a preexisting scoliosis condition for which she had undergone surgery subsequent to the injury.

The parties utilized an Agreed Medical Examiner who concluded that applicant was limited to light work and apportioned 50 percent of her disability to the preexisting scoliosis and 50 percent to the industrial injury. In describing apportionment the doctor specifically noted that the injured worker had a chronically weakened lumbar spine as a result of the scoliosis and that she was significantly more vulnerable to any injury than she would have been in the absence of such condition. The doctor's opinion on apportionment was based upon his perception that the preexisting condition clearly made her more vulnerable and the industrial injury clearly aggravated the condition to the point where surgery was required. He opined that the allocation of 50/50 was "reasonable" under the circumstances.

Of significance is also the fact that the doctor conceded absent the industrial injury, he would not have been able to state that she would have become disabled. Nonetheless the WCAB determined that his opinion met the criteria for apportionment under Labor Code section 4663 and Escobedo v. Marshall's (2005) 70 CCC 604.

This decision is significant because the arguments made by applicant were specifically based upon the footnote 7 in Escobedo where the Board indicated that they were not talking about "lighting up" cases. In this case the industrial injury clearly "lit up" the scoliosis which was previously asymptomatic to result in significant additional disability. Further, the fact that the Agreed Medical Examiner indicated he could not state with reasonable medical probability that the scoliosis would have progressed to become disabling absent the industrial injury, addresses one of the other arguments often raised by applicant attorneys and argued by physicians disputing apportionment. I have frequently seen commentary by applicant attorneys that in order to support a finding of apportionment, the physician must be able to state that absent the work injury the pre-existing condition must either have been disabling or would have become disabling absent the industrial injury. This is a case of a previously asymptomatic condition which made the injured worker clearly much more vulnerable to trauma, contributing in a very significant manner to her disability after an industrial injury, but the WCAB did not require a showing that there would have been disability in the absence of the injury; just that the pre-existing condition contributed to the disability that ultimately was found..

4. OLIVARES v. WCAB, CONSTRUCTION PROTECTIVE SERVICES INC. ADJUSTED BY SOUTHLAND CLAIMS SERVICES, 70 CCC 1358
Issue: Reopening Record for Deficits in Representation by Prior Applicants Attorney

In this case the WCAB granted a defendants' petition for removal from an order reopening discovery for further development of the medical record after discovery had been closed at an MSC, reversed the WCJs order reopening discovery and sent the case back to the trial level.

The applicant had petitioned to reopen discovery upon changing attorneys and arguing that the initial attorney had not raised all the issues that should have been raised or develop the medical record in a complete fashion. The WCAB rescinded the trial judge's reopening of discovery taking the matter off calendar holding that:

"&applicant claims in his deposition that he had back pain from the date of his injury, it is never mentioned in the reports of the treating physician. Although the applicant's medical reports are not in the Appeals Board's file, the WCJ states in his report that an MRI shows a nine millimeter disc protrusion in the back. Yet none of applicant's attorneys succeeded in getting a Qualified Medical Evaluation (QME) and one of applicant's attorneys apparently 'forgot' to list injury to the back as an issue at the MSC."

"In McDuffie v. L.A. County MTA (citations omitted) the Appeals Board stated: 'Before directing augmentation of the medical record&, the WCJ or the Board must establish as a threshold matter that the specific medical opinions are deficient&"

The significance of this decision is the manner in which the Board dictates that the record is to be evaluated for purposes of reopening discovery when there is an order of closure. The methodology dictated in McDuffie and relied upon in this case, is for the judge to complete the existing record and determine whether he has an adequate basis upon which to make a determination. If the record is deficient at that point the judge may make a determination that the record needs to be supplemented or completed in some fashion. However the judge is not simply to take an assertion that additional information is needed and proceed at that point but must make a finding based on the evidence as presented that the record needs to be completed. The question of whether the Injured Worker will be entitled to re-open the record will depend on whether the WCJ believes that he/she is unable to render a decision on the existing record.

5. PERMANENTE MEDICAL GROUP v. WCAB (ROSALES), 70 CCC 1370
Issue: Calculation of PERMANENT DISABILITY Benefits after Petition to Reopen Granted

This case addresses an issue which I have seen coming up in some frequency and demonstrates a fundamental lack of understanding of how workers' compensation permanent disability benefits are calculated. In this case the applicant had already received an Award of permanent disability benefits from the WCAB. Upon filing a Petition for New and Further Disability, the WCJ determined that the injured worker had demonstrated increased disability and awarded additional permanent disability. Defendants argued that exiting permanent disability rating should be subtracted from the increased rating. However the WCAB properly determined that the dollar value would be credited against the new Award not the percentage of disability. The WCAB determined that Nabors v Piedmont Mill and Lumber did not apply to this situation.

When a Petition for New and Further Disability is granted (or for that matter Petition to Reduce) it is the same injury that is being litigated not a new injury. There is no "preexisting" disability to be subtracted or considered on the basis of apportionment. This is not an apportionment issue but simply a re-determination of the same injury with a different (increased or decreased) level of disability. In making such an Award defendant is entitled to credit for the payments that have already been made for the prior Award, just as if it was taking credit for permanent disability advances. There is no legal basis for an argument that the defendant is entitled to subtract the prior permanent disability rating from the new permanent disability rating as can be argued where we have separate injuries.

There is nothing about Labor Code section 4663 or 4664 which has any impact on calculations of benefits for the same injury whether on the basis of a new and further disability or a reduction in a prior permanent disability Award. Those sections only impact apportionment to different injuries or different causes, not the same injury.

End of summary of writ denied cases.

By attorney Richard "Jake" Jacobsmeyer, managing partner of the Concorde office of Adelson, Testan, Brundo & Popolardo. Jake can be reached at richardjacobsmeyer@atblaw.net.

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