February 2, 2006

Digest of
Appellate Decisions
January 2006

Trimmer v. WCAB (Monaghan Township), 277 C.D. 2005 (Pa. Cmwlth. 2005)

On a remand to determine amount of benefits, WCJ was not free to determine that Claimant was no longer disabled.

Commonwealth Court reversed the decision of the WCAB and the WCJ and remanded the case for determination of the amount of benefits available to Claimant. Claimant had received injuries while acting as a volunteer firefighter for Employer in 1989. Claimant was paid full disability thereafter until 1995, when Employer filed to suspend the benefits alleging that he had sufficiently recovered to resume his employment without loss of earnings. The WCJ agreed that Claimant had sufficiently recovered to make enough money to meet the labor market survey salary rate for an unimpaired garage supervisor. The Board affirmed. The Court remanded the matter so that the earning capacity of a garage supervisor with Claimant’s physical limitations could be determined, since the evidence had failed to establish that Claimant had regained his pre-injury capabilities.

The WCJ again determined that Claimant had regained his ability to perform pre-injury duties. The Board affirmed and the Court remanded a second time. The WCJ received more evidence and still determined that Claimant was able to perform the duties that supported the originally determined earning capacity. The Board again affirmed. On the third appeal, the Court strenuously pointed out that the market survey provided the earning capacity only of unimpaired garage supervisors and Claimant’s impairment was still established. The matter had not been previously remanded to give Employer additional opportunities to provide evidence of Claimant’s ability to work. Accordingly, the matter was remanded a third time for the WCJ to determine the amount of total disability benefits payable to Claimant. Judge Cohen Jubelirer dissented, agreeing with the WCJ.

City of Philadelphia v. WCAB (Sites),
1410 C.D. 2005 (Pa. Cmwlth. 2005)

Claimant proved that his hepatitis C was connected to his employment as a firefighter and EMT and was awarded benefits under the theory of work-related occupational disease.

Commonwealth Court affirmed the decisions of the WCJ and the Board, which awarded Claimant benefits based on his contraction of hepatitis C. Claimant worked for Employer as a firefighter and an EMT since 1996. Three years later, Claimant was diagnosed with hepatitis C. Claimant filed a petition for total disability benefits for workdays missed due to his disease. At the hearing, Claimant testified about his participation in approximately 1,000 medical runs, many of which left him covered in blood. During his 48-week period of treatment, Claimant called out sick often due to the significant side effects of his medication. Although Claimant received treatment for alcohol abuse over 20 years ago, his doctor testified that the liver damage he suffered did not fit the pattern of alcohol abuse and was consistent with a diagnosis of hepatitis C.

The WCJ found that Claimant had established by credible and persuasive evidence that he had sustained a work-related injury and allowed benefits for the days that he missed work. The Board affirmed this decision.

Initially, the Court held that Claimant’s petition was not barred by the statute of limitations, since Claimant was not made aware of his diagnosis until 1999, three years before his petition was filed. Secondly, the Court ruled that hepatitis C was a compensable occupational disease at the time Claimant received his diagnosis. The fact that the statute was amended to include the disease by name during the course of litigation did not prevent its application: immediate application of the amendment to an event occurring before its enactment was not prohibited, as long as the litigation had not been resolved. Finally, the Court supported the evidentiary findings of the WCJ as to the proof offered by Claimant to support his claim. Accordingly, the decisions were affirmed.

Virgo v. WCAB
(County of Lehigh-Cedarbrook),
1167 C.D. 2005 (Pa. Cmwlth. 2005)

Claimant’s several unsatisfactory performance reviews were sufficient to show bad faith on her part and support Employer’s suspension petition.

Commonwealth Court affirmed the decisions of the WCJ and the Board, which denied Claimant’s reinstatement petition and granted the suspension petition filed by Employer. Claimant was injured in 2002 and Employer issued an NCP. During the period between the injury and the time the NCP was issued, Claimant never stopped working for Employer, however she was placed on light duty a year after the injury. A few weeks after the change, Claimant was fired for cause. Alleging that she was not fully recovered from her work-related injuries on the day of her discharge because she was performing light duty, Claimant filed the instant petition seeking reinstatement. Employer filed for a suspension, alleging that benefits should be suspended because of Claimant’s failure to carry out her duties.

The WCJ found that the performance reports presented by Employer were sufficient to support Claimant’s termination, even though she was found to still be suffering some symptoms from her injury. After a discussion as to which party had the burden of proof, the Court held that Employer always had the burden of establishing a lack of good faith on Claimant’s part, since there had never been a formal suspension of benefits. The Court disagreed with Claimant’s argument that a specific act of willful misconduct must be shown before benefits could be suspended. The Court held that Claimant’s succession of unsatisfactory performance reviews were sufficient to support a bad faith finding. Finally, the Court held that the reviews were properly entered under the business record exception to the hearsay rule, and because Claimant failed to object to their admission at hearing. Accordingly, the orders were affirmed.

Gardner v. WCAB
(Genesis Health Ventures),
14 EAP 2004, 103 MAP 2004 (Pa. Supreme Ct. 2005);
Wal-Mart Stores, Inc. v. WCAB
(Leroy Rider),
103 MAP 2004 (Pa. Supreme Ct. 2005)

Once a claimant comes into possession of 104 weeks of total disability benefits, the insurer has 60 days from that date during which it must request that the claimant submit to an IRE for the purposes of obtaining the automatic relief set forth in 77 P.S. 511.2(2).

The Pennsylvania Supreme Court considered companion cases and issued an opinion as to the appropriate timing for an employer’s request for an IRE for the purposes of obtaining an automatic reduction in benefits under the Act. In the Gardner case, Employer asked Claimant to submit to an IRE nearly 32 months after she began receiving benefits. Claimant declined and the Employer filed a petition to compel the exam. The WCJ denied the petition, the Board reversed and Commonwealth Court held, in a published opinion that an insurer must request that a claimant submit to a medical exam within 60 days of the claimant’s receipt of 104 weeks of total disability benefits, or be forever precluded from modifying the claimant’s benefits based on the procedure set forth in 77 P.S. 511.2. However, Commonwealth Court specifically noted that an employer may at any time request that a claimant submit to a medical exam under 77 P.S. 651 in order to modify a claimant’s benefits based on a change in medical condition and earning power. Employer filed the instant appeal.

In the Rider case, Employer requested the IRE 163 weeks after the date when total disability benefits began, but within 60 days of the final adjudication of Claimant’s claim. After the exam, Employer told Claimant that his disability status had changed from total to partial and reduced his benefits. Claimant filed the instant petition to reinstate his total benefits, arguing that the IRE request was untimely. The WCJ granted the petition and was affirmed by the Board. Commonwealth Court reversed the decision, finding the IRE timely requested, since Claimant did not “receive” 104 weeks of total disability benefits.

The Court consolidated both appeals to rule on the timing requirements of an IRE request. The Court dealt first with the Rider appeal and held that the 60-day period for the IRE request began to run once an employee has come into possession of 104 weeks of total disability benefits, regardless of the surrounding litigation regarding the entitlement to the benefits. Accordingly, the Rider decision was reversed. In Gardner, the Court found the plain language of the statute controlling and held that the request for an IRE had to be made within 60 days after the receipt of 104 weeks of total disability. The Court rejected Employer’s argument that the use of the world “shall” in the statute was not mandatory. The Court considered the plain language of the statute, as well as the ways the word was used in other parts of the statute in coming to their conclusion. The decision in Gardner was affirmed. The Court noted, that although an employer was excluded from requesting the IRE for automatic relief purposes, an IRE could still be requested and the results could be used to petition for reduction through the traditional administrative process. Justice Newman filed a dissenting opinion. (See VDC’s newsletter “IREs Under Gardner” for more detailed discussion of this decision.)

Panyko v. WCAB (U.S. Airways),
37 WAP 2004 (Pa. Supreme Ct. 2005)

Claimant may receive benefits for suffering a heart attack at work without showing that abnormal working conditions existed, but that his injury was a physical injury due to a psychic reaction to a working condition.

The Pennsylvania Supreme Court reversed the decision of the Commonwealth Court, which affirmed the Board’s denial of Claimant’s claim petition. In 1997, Claimant suffered a heart attack during a meeting with one of his supervisors. Claimant had had triple bypass surgery two years earlier, but had missed only four days since his return to work. After his heart attack, Claimant returned to work and asked an administrator if he was eligible for benefits. When the administrator told him no, he did not file a claim. After reviewing a workers’ compensation book six months later, however, Claimant realized that he might be eligible for benefits and filed his claim.

The WCJ granted the petition and the request for counsel fees. On appeal, the Board affirmed the determination of benefits, but denied the counsel fees award, ruling that Employer reasonably contested the petition because the legal question of notice needed to be resolved. Employer again appealed and Commonwealth Court further reversed the award of benefits. Commonwealth Court held that Claimant was obligated to show not only that the psychic reaction to his working condition caused his heart attack, but also that the working condition that caused the psychic reaction was abnormal. The Court remanded the matter for further evidence. After further evidence, the petition was dismissed and this dismissal was affirmed by the Board and Commonwealth Court.

On appeal, Claimant argued that the matter had been improperly remanded; arguing that additional evidence of abnormal working conditions was required only when a psychic injury was claimed. The Court agreed that a claimant was not required to meet the restrictive abnormal working conditions test in situations where a purely physical injury such as a heart attack was suffered. The Court went on at length to distinguish the Davis decision as one where only a psychic injury with physical symptoms was alleged. Instantly, Claimant suffered a purely physical injury due to a psychic reaction to a working condition. The Court noted that Claimant’s injury was objectively verifiable and could be traced to an identifiable source. Since Claimant could show that he suffered from such a verifiable injury, which arose during and was related to the course of his employment, the denial of his claim petition was reversed. Justices Saylor and Newman dissented, arguing that the supervisors’ meeting was not sufficient basis to find causation of Claimant’s heart attack.

Department of Labor & Industry
v. WCAB (Exel Logistics),
23 EAP 2004 (Pa. Supreme Ct. 2005)

Forfeiture granted under Section 306(f.1)(8) due to refusal of treatment did not allow employer to collect Supersedeas Fund reimbursement, since the forfeiture was not granted under Sections 413 or 430.

The Pennsylvania Supreme Court affirmed the decision of the Commonwealth Court, which reversed the Board’s order granting Supersedeas Fund reimbursement. Employer issued a notice of compensation payable in 1993 for claimant’s shoulder injury. In 1997, Employer filed a petition for forfeiture, alleging that claimant had refused reasonable medical treatment, and requesting supersedeas while the petition was pending. The petition for supersedeas was denied, but the petition for forfeiture was granted a year later. Employer then filed the instant petition for reimbursement. The WCJ denied the petition, since the request for forfeiture was made pursuant to section 306(f.1)(8), not sections 413 or 430 of the Act. The Board reversed, finding that the request fell under section 430. Commonwealth Court reversed, agreeing with the WCJ’s reasoning.

On review, the Court held that Employer’s petition was not a suspension petition under section 413, since no change in Claimant’s status affecting his right to receive benefits needed to be alleged. Employer merely needed to show that claimant refused treatment. Nor did Employer’s petition fall under Section 430 because Employer did not contest claimant’s disability, but rather alleged that claimant had forfeited his right to benefits. The Court found that the plain language of section 443 did not authorize reimbursement to employers seeking relief under section 306(f) of the Act; nor did any language in 306(f) call for Supersedeas Fund reimbursement. The order of Commonwealth Court was affirmed. Justices Newman, Nigro, Castille and Baer dissented and agreed with Employer’s reasoning.

Acme Markets, Inc v. WCAB (Brown),
1147 C.D. 2005 (Pa. Cmwlth. Ct. 2006)

Claimant’s net income as a self-employed real estate appraiser was used to adjust the amount of his benefits, and included his deduction for his wife’s secretarial services.

Commonwealth Court affirmed the decisions of the Board and WCJ to reinstate Claimant’s partial disability benefits. Claimant suffered his injury in 1988 and received full benefits for six months. Claimant left the job in 1996 due to pains related to the injury, and filed this reinstatement petition shortly thereafter. The WCJ reinstated full benefits and credited Employer for Claimant’s net earnings based on his side earnings as a self-employed real estate appraiser. Employer filed this appeal and argued that Claimant’s gross income from his self-employment more accurately reflected his earning capacity.

The Board remanded for the taking of additional evidence, and the WCJ found that Claimant’s business deductions claimed on his tax returns were accurate and incurred in connection with his appraisal business, including the income he paid his wife for her secretarial services. The Board accepted the WCJ’s evidentiary determinations, but found that the WCJ had failed to answer the determinative question of whether Claimant’s net earnings or gross earnings accurately reflected his earning capacity. The WCJ took no additional evidence and issued a decision that found that the net earnings were a more accurate reflection of Claimant’s earning power. This decision was affirmed by the Board.

On appeal, the Court disagreed with Employer’s contention that the WCJ had disregarded the testimony of Employer’s vocational expert as to the income of Claimant’s wife. The testimony of the expert did not correlate to the secretarial and bookkeeping functions as they were performed by wife. Since the Court could find no reason to disturb the factual or legal conclusions of the WCJ, the decision was affirmed.

Zuback v. WCAB
(Paradise Valley Enterprise Lumber Co.),
1173 C.D. 2005 (Pa. Cmwlth. 2006)

Claimant was entitled to replacement costs of stair glides in his home, since the glides were more in the nature of an orthopedic appliance rather than a home modification.

Commonwealth Court reversed the Board’s denial of Claimant’s request for replacement costs of his two stair glides. Claimant had been injured on the job in 1976, which had resulted in the loss of his left leg, left arm and two toes on his right foot. After the injury, Employer installed two stair glides in Claimant’s house, which allowed him to move from floor to floor in his three-story house. In 2003, Claimant filed the instant petition, alleging that Employer had failed to pay for repairs to the stair glide. Claimant also requested penalties and counsel fees. Employer’s expert testified that two firms submitted estimates to replace the glides, since the current glides were determined to be too old to be adequately repaired. Employer then cancelled the repairs.

The WCJ concluded that Employer was not required to replace the glides, since the law required a one-time only expenditure for the necessary modifications to Claimant’s home. The request for counsel fees for the unreasonable contest of the petition was also denied. The Board affirmed. On review, the Court concluded that the stair glides were in the nature of an orthopedic appliance such as a wheel chair and should receive the same treatment, including replacement for wear and tear. The Court rejected the characterization that the glides were modifications to his home, to be limited to a one-time expenditure.

The Court did agree that Employer’s contest of the issue was reasonable, since no case law on the point existed. Accordingly, the denial of replacement costs was reversed and the denial of attorney’s fees was affirmed.

Hepler v. WCAB
(Penn Champ/Bissel, Inc.),
1727 C.D. 2005 (Pa. Cmwlth. 2006)

Claimant bears the burden of showing injury forced him out of entire job market; failure to seek light duty work that he was released to do made Claimant ineligible for benefits.

Commonwealth Court affirmed the decision the Board, which reversed the dismissal of Employer’s modification petition. Claimant began receiving benefits for a right knee injury suffered in 1993. Ten years later, Employer filed the instant petition requesting modification, alleging the Claimant had left the workforce voluntarily. Claimant filed an answer denying the allegations and stating that his work injury was the sole reason for his lack of employment. The WCJ denied the petition and concluded that Claimant did not voluntarily remove himself from the workforce, but was severely limited by his injury to perform even limited duty. The WCJ went on to state that Claimant’s receipt of a disability pension was his only viable option.

The Board reversed, holding that Claimant bore the burden of showing that his injury forced him out of the entire labor market, not just his pre-injury job. The Board concluded that Claimant had failed to meet this burden because he had not searched for work since he left his employment, and did not return to work after being released to do so by his doctor, who was treating him for a non-job related injury. On appeal, Claimant argued that he was not charged with such a burden, and if he was, he claimed that the Board erred in failing to remand the matter for the taking of further evidence related to the burden. The Court noted the burden was placed on a claimant following a retirement, and held that a claimant must show that he is seeking employment after retirement or that he was forced into retirement because of his work-related injuries in order to continue to receive disability compensation. Since Claimant testified to his absence of a job search since being released from treatment, the Board properly concluded that Claimant had failed to sustain his burden of proving that he had not voluntarily withdrawn from the entire labor market. Since Claimant had failed to sustain his burden, it was inappropriate to remand the matter in order to give him another opportunity to do so. Accordingly, the order was affirmed.

Riggle v. WCAB
(Precision Marshall Steel Company),
1431 C.D. 2005 (Pa. Cmwlth. 2006)

Payment of medical benefits does not toll the statute of limitations for reinstatement of indemnity benefits under Section 413.

Commonwealth Court affirmed the decisions of the Board and the WCJ, which denied Claimant’s petitions for reinstatement for compensation in the form of indemnity and medical benefits. Claimant had sustained his injury in 1993 and was out of work for two months before he returned to light duty. Four months after his return, Claimant was suspended from the job for reasons unrelated to his injury. Claimant was given a choice to be fired or resign. Claimant resigned and his benefits stopped. Thereafter, Claimant filed a reinstatement petition and Employer sought termination of its liability for medical expenses. The WCJ granted the termination and denied the reinstatement.

Claimant filed another reinstatement petition, alleging his condition had worsened. The WCJ dismissed the petition and held that it was not timely filed, since it came more than three years after the most recent payment. Even though Claimant received payment of medical bills thereafter, those payments did not constitute payment of compensation for the purpose of extending the three-year statute of limitations found in section 413 of the Act. On appeal, the Board upheld the timeliness decision with regard to payment of indemnity benefits, but reversed and remanded the matter with regard to payment of medical benefits, since they were terminated after the litigation of the first reinstatement petition, less than three years prior to the filing of the second petition.

On remand, the WCJ found that Claimant’s condition had not worsened based on the credible testimony of Employer’s expert, and again denied the petition for reinstatement. The Board affirmed this decision. Initially, the Court affirmed the Board’s determination that the payment of medical expenses did not toll the statute of limitations under section 413. The Court rejected Claimant’s argument that since such an exception existed under section 315, it should be applicable to section 413, as the Pennsylvania Supreme Court had drawn a distinction between the two. Finally, the Court rejected Claimant’s argument with the WCJ’s determination on the merits, since Claimant made no specific argument to support his position. Accordingly, the dismissal was affirmed.

ConocoPhillips formerly Tosco Oil
v. WCAB (Logan),
515 C.D. 2005, (Pa.Cmwlth. 2006)

Employer was not entitled to reimbursement from Supersedeas Fund when it made payment of benefits prior to formal denial of its petition for supersedeas, and prior to the deadline at which the petition could be deemed denied.

Commonwealth Court affirmed the Board’s decision, which denied Employer’s application for superdeas fund reimbursement because Employer paid benefits before there was a denial of the request for supersedeas. Claimant filed a petition in 1999, claiming occupational hearing loss. Employer was ordered to pay benefits in 2001, but appealed and requested supersedeas. On the same day that supersedeas was granted, unbeknownst to Employer, Employer paid Claimant a lump sum award loss of over $50,000.00. On appeal, the Board partially reversed the award, prompting a $36,000.00 reduction in Claimant’s award. Employer sought reimbursement of the overpayment from the Supersedeas Fund. The Bureau answered and asserted that Employer was not entitled to reimbursement because the request for supersedeas was granted rather than denied and that Employer had failed to present grounds on which relief could be granted under section 443(a).

The WCJ held that the Employer was ineligible to receive reimbursement because the payment it made was not as a result of a denial of its request for supersedeas. Further, Employer could not argue that its original supersedeas request had been denied because it paid the benefit prior to the 50-day time limit for ruling on the petition. The Court found that the Special Rules issued by the Board regarding petitions for supersedeas and deemed denials controlled. Employer could not be assessed penalties for non-payment within 30 days if there was a supersedeas petition pending. Accordingly, a supersedeas petition could not be deemed denied prior to the exhaustion of the 50-day filing and answer period set forth in the Special Rule.

The Court sought to protect the Supersedeas Fund and prevent an escalation of workers’ compensation costs for employers and insurers. Accordingly, absent a formal or properly deemed denial from the Board, Employer was not entitled to reimbursement from the Fund. Judge Leavitt issued a concurring opinion.

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