Case Law Update
BCPWQ Seminar
April 17, 2015
CAUSATION
Arising Out of and In the Course of – Parking Lot
Demario Davis v HCR ManorCare and Second Injury Fund, 2014 ACO #42. The plaintiff testified that he slipped and fell on his way to work in the employer parking lot, which was under construction. However, the employer argued that he fell while walking across a grassy slope instead of across an employer approved wooden walkway. In remanding, the Commission noted that the plaintiff’s history provided to several doctors and defendant’s employees all assert that the plaintiff fell on the slippery grass area before he reached the parking lot. Only the plaintiff’s trial testimony suggested that he fell in the parking lot. Also, he carefully avoided directly answering whether his slip and fall occurred while walking down the grassy slope. Therefore, the only reasonable finding is that the plaintiff fell on the grassy hill. As the ownership of the grassy hill was not established, the plaintiff failed to prove the fall occurred on the defendant’s premises. Finally, as the fall did not occur on the employer’s premises, the magistrate must make a finding that the plaintiff fell while traveling in a reasonably direct route to work in order to find plaintiff’s injury arose out of an in the course of plaintiff’s employment.
Arising Out of and In the Course of – Premises, Social/Recreational
Robert Burda, Personal Representative of Karen Burda, Dec’d v Lincoln Consolidated Schools, 2014 ACO #33. Pursuant to the second sentence of MCL 418.301(3), the Commission reversed the magistrate’s decision awarding benefits for the fatal injuries sustained by a school employee who was riding on the tailgate of a coworker’s truck during her lunch hour on school property when she was ejected from the vehicle. At the time of the accident, the decedent was travelling between the middle school, where she performed her work duties, and a nearby high school. In reversing, the Commission noted that MCL 418.301(3) created an exception to the presumption of an injury occurring in the course of employment upon the employer’s premises. Injuries incurred in the pursuit of an activity, the major purpose of which is social or recreational, are not covered under the WCDA. This statutory exclusion from coverage is controlling in this case because the magistrate found there was no dual purpose for the trip undertaken by the decedent to travel to the high school. The purpose of the trip was found to be strictly non-occupational – the decedent and her coworker wanted to see the swimming pool simply out of curiosity. Although this may have promoted a sense of comradery between the decedent and her coworker, this was manifestly social, non-occupational in nature. The Commission went on to address the defendant’s argument that the decedent’s injuries were the result of actions arising to the level of intentional and woeful misconduct, as contemplated by MCL 418.305. Reviewing case law, the Commission concluded that the decedent’s actions did not constitute intentional or woeful misconduct or willful negligence. There was no evidence of a violation of employer rules or evidence that the decedent was conscious that her actions in riding on a tailgate were an obstinate or perverse opposition to the will of her employer.
Arising Out of and In the Course of – To/From Work
William Little and Merchants Preferred Insurance Co., intervening plaintiff v Kappen Tree Service and Truck Insurance Exchange, (Court of Appeals, December 11, 2014). The majority of the Michigan Court of Appeals affirmed that the plaintiff was not acting in the course and scope of his employment when he suffered injuries in a motor vehicle accident after picking up the employer’s vehicle from headquarters and while driving to an out of town site. Evidence indicated that the employer had a special crane at the site. The employer only had one such crane and one crane operator, the plaintiff. In affirming, the Court found no evidence that the plaintiff was on a special mission on the day in question. He did not face circumstances different from his normal commute to work on the morning of his accident. Although the plaintiff was allowed to drive a company truck to the job site on the day of the accident, this was done as a favor to the plaintiff, so he would not have to miss work that day, rather than as a special instruction issued by the defendant. Next, the Court found no special benefit derived from the plaintiff’s travel on the day of the accident. Although the defendant enjoyed a benefit from the plaintiff coming to work on the day of the accident, the benefit was common to all employers. While the plaintiff was the only employee capable of operating a certain crane, which allowed the defendant to charge more for its services, that special benefit was enjoyed once the plaintiff arrived at work, not during his commute. Finally, the Court found the employee did not fall within the dual purpose exception. Although the plaintiff was driving a company truck to work at the time of his injury, the trip was personal in nature because the context in which the defendant’s employees are expected to travel and from work. The plaintiff is generally responsible, like all of the defendant’s employees, for providing his own transportation to and from work. The defendant did not derive any benefit from the plaintiff until he arrived at the worksite. Although he had been planning to give a coworker a ride at the end of the day, he would have done this in his own vehicle had it been available, and he did not actually provide the ride because of the accident on his way to work.
Arising Out of and In the Course of – Deviations
Edward Kosal, Sanilac County Road Commission, intervening plaintiff, v Sanilac County Road Commission, 2014 ACO #29. This case involves a claimant who was injured in the parking lot of a restaurant while taking an unscheduled lunch break. The Court held that the medical and testimonial record was clear that the plaintiff suffered a fall while getting out of his truck and either slipped on a step of the truck or on immediately adjacent ice, resulting in injuries to his neck and head that eventually resulted in fusion surgery. Moreover, citing precedent, the Court found that a slight deviation to carry out a personal mission precluding compensation is no longer the law in Michigan regarding workers’ compensation injuries. With regard to the facts at hand, the Commission found that the Plaintiff was expected to forgo his regular lunch period and work through it to accomplish the snow plowing of a certain road. He elected to stop and get a bowl of soup to eat with his sandwich after the plowing was done. The Court held that this is not such a personal errand as to take plaintiff outside the coverage of the workers’ compensation statute. Bolstering this conclusion was the testimony of plaintiff’s supervisor. He acknowledged it was not unusual for this sort of circumstance to happen when conditions were bad and roads had to be cleared. It appears from his testimony that the employer was aware of, tacitly sanctioned these minor deviations and had never disciplined anyone for not taking their lunch break within the scheduled period. Accordingly, the Commission held that plaintiff’s injury arose out of his employment was amply supported by the record.
Medically Distinguishable Condition/Pathologic Aggravation – Nerve Root Irritation
Delrel Laur v. General Motors Corporation, 2014 ACO #43. In this case the Commission addressed the findings of the Magistrate who, citing he lack of significant objective findings on any electro-diagnostic and imagining studies, found there was not a sufficiently “medically distinguishable” condition or “change in pathology” from plaintiff’s acknowledged degenerative conditions. Nevertheless, the Commission remanded the case for further inquiry. On a second appeal, the Court upheld the (new) Magistrate’s finding that although there was significant embellishment on the part of the plaintiff, the Magistrate found there was enough “trauma” to have the potential to cause nerve root irritation, in the nature of radiculitis, in an individual who is pre-disposed to same based upon the pre-existing non-work-related underlying pathology (e.g. degenerative disc disease with spurring). Upon the finding of the work-related injury (pathologic aggravation), Plaintiff was found to be disabled. Nevertheless, based on the testimony of defendant’s independent medical examiner, the plaintiff had recovered a short time later and any remaining pathologies were the result of plaintiff’s preexisting conditions.
Medically Distinguishable Condition/Pathologic Aggravation – Increase in pain, swelling and decreased range of motion
Kevin Meyers v. Big Lots Stores, 2014 ACO #46. In this case the Court addressed the findings of the Magistrate who found the Plaintiff disabled as a result of a work injury to his left knee. Medical records and testimony suggest the pre-existence of chondromalacia in the left knee. In overturning the Magistrate’s finding of a work related injury, the Court relied on Rakestraw and its progeny. Specifically, the Court found that the expert medical testimony adopted by the Magistrate which supported his finding of a pathologic change (e.g. increase in pain, swelling and decrease range of motion) did not arise to the standard under Rakestraw/Fahr. The Court went on to explain that pain complaints by themselves clearly do not suffice under Rakestraw/Fahr. The finding that limited range of motion was supported by insubstantial evidence. And, finally, inflammation does not constitute evidence of an injury sufficient to satisfy Rakestraw/Fahr.
DISABILITY
Universe of Jobs
Karen Hinton v General Motors Corporation, 2014 ACO#28. The Commission found that the magistrate failed to correctly apply the current disability standard to create the list of jobs suitable to plaintiff’s qualifications and training. The magistrate simply listed the jobs plaintiff previously performed and then concluded that those jobs constitute the universe of jobs suitable to plaintiff’s qualifications and training. According to the Commission, this constitutes the specific error precipitated Stokes. Stokes necessitates that plaintiff prove the universe of jobs beyond the jobs plaintiff previously performed based on her qualifications and training. More specifically, plaintiff must prove the management jobs that her experience qualifies her to perform. Likewise, she must prove the supervisory positions that encompass transferable skills from her experience performing that task. In addition, plaintiff must prove the jobs that she could obtain with her BA in Business Communication.
The Commission also found the magistrate confused the burden of proof. The magistrate seemed to suggest that the plaintiff need only present the list of jobs previously performed in order to shift the burden of proof to defendant. Plaintiff bears the burden of proof. If the record does not establish the universe of jobs beyond plaintiff’s previously performed jobs, then plaintiff failed her burden of proof. Likewise, if this record does not establish the universe of jobs suitable to plaintiff’s college degree, then plaintiff has failed her burden of proof. Contrary proofs presented by defendant serve to expand the universe of jobs suitable to plaintiff’s qualifications and training. The absence of proofs by defendant cannot obviate plaintiff’s burden.
Restrictions Attributable to Preexisting Pathologies
Mary Ball v. State of Michigan, Department of Corrections, 2014 ACO #45. This case is about allocating plaintiff’s restrictions between preexisting pathology and the work injury. The magistrate concluded that all of plaintiff’s restrictions were attributable to her work injury because the records did not identify any restrictions before the work injury. The Commission determined that the absence of records does not constitute substantial evidence on the record. Specifically, the Commission pointed out that the medical records established significant preexisting pathologies unrelated to plaintiff’s work. The pathologies necessitated decades of treatment. Nevertheless, the magistrate found that the preexisting pathologies precipitated absolutely no limitations for plaintiff. The Commission opined that if the magistrate’s opinion were true then “the day before the injury the evidence showed that plaintiff could perform a job that required her to bend and lift 50 lbs, 100 times and hour, with a twisting motion.” The Commission found that the record could not support that conclusion. Therefore, the Commission remanded the case and required the magistrate to identify restriction related to the plaintiff’s preexisting condition and those related to her work injury. If the magistrate finds no restrictions before the injury, he must identify the evidence that allows him to allocate medical impairment to the preexisting condition and the work injury.
Impact of injury at Subsequent employer
Edwin Nichols v Howmet Corp. and Pacific Employers Insurance and Michigan Property and Casualty Association, (Court of Appeals, July 24, 2014). In a case involving a dispute between two insurance carriers of the same employer regarding liability for wage loss benefits to the plaintiff, who suffered two distinct injuries – a cervical spine injury in 1993 and a low back injury in 1998, the Michigan Court of Appeals held that the first carrier was only liable for wage loss related to the plaintiff’s 1993 cervical spine injury and partial disability, and the second carrier was liable for wage loss related to the plaintiff’s 1998 low back injury. To hold the first insurer liable for the employee’s entire amount of wage loss benefits when a second disabling injury causes the employee to lose his or her job defies principles of causation in workers’ compensation law for two reasons. First, an employee’s entitlement to wage loss benefit from an employer (or insurance carrier) is based on his or her reduction in wage earning capacity. Here, plaintiff’s 1993 cervical spine injury did not cause the vast majority of plaintiff’s wage loss. Rather, his 1998 low back injury caused much of that wage loss. Plaintiff’s ability to continue to earn $567.70 a week while performing reasonable employment after his 1993 cervical injury illustrates this point precisely. Second, an employee’s post-injury earnings or ability to earn operates as a credit and mitigates the employer’s liability to pay wage loss benefits. The Court of Appeals concluded that when a first injury partially disables an employee, that employee resumes working but then suffers a second disabling injury, the first insurance carrier is not liable for wage loss benefit attributable to the second disabling injury.
Impact of avocational injury on previously compensated work injury
Michael Deplaunty v Troy School District and Second Injury Fund, 2014 ACO #14. In 1988, plaintiff went to work for the defendant, Troy School District, as a Custodian. In June 1999 he sustained a work-related injury to his low back. He was off work for some time, undergoing surgery on August 27, 1999 and eventually returning to work in December of that year. Then, on October 2, 2000, while plaintiff was transferring school on property, he was rear-ended by another individual. As a result of his injuries he incurred in this accident, he underwent another back surgery by Dr. Easton on October 13, 2000. Following that surgery, plaintiff returned to work on March 2, 2001. However, he was taken off work by Dr. Easton on May 6, 2002. Dr. Easton believed that he performed the surgeries based upon objective testing, which he believed were related to plaintiff’s work injuries. Plaintiff told of a third accident, which he was involved in on July 19, 2003, when he was going on a recreational weekend with friends and the bus, in which he was riding, rear-ended another vehicle and plaintiff was thrown on the floor of the bus, resulting in increased pain. In September 2003, Dr. Easton performed a lumbar surgery. Plaintiff did not return to work after May 2002.
The magistrate provided plaintiff an open award of weekly benefits. The Order also required defendant to pay all reasonable, necessary and related expenses for treatment related to plaintiff’s lumbar spine from January 7, 1999 up to July 19, 2003, pursuant to cost containment.
The Commission found that the magistrate’s Opinion and Order is to be modified in that medical benefits for treatment of plaintiff’s condition resulting from his work related injury shall continue. Treatments for injuries resulting from non-work related bus accident are not covered. The Commission recognized that the separation of necessary work related injury treatment and non-work related injury treatment may be problematic but advised the parties to work it out amongst themselves.
Psyche injury and Significant Manner testing
Sheila Duncan v State of Michigan, Department of Corrections, 2014 ACO #17. On January 26, 1990, while working as a Corrections Officer, plaintiff was in the course of her employment when she walked outside of her assigned building and got into a vehicle with a coworker and drove away. When nearing the gate to the highway, plaintiff got out of her vehicle and was approached by five inmates. The inmates grabbed and began assaulting her. Plaintiff testified that she was on the ground and was kicked and beaten. Plaintiff eventually returned to work, but according to her testimony, she continued to have difficulty. Between 1991 and 2002, plaintiff did not have any psychiatric or psychological treatment and continued working.
Plaintiff never returned to work after July 2002, eventually applying for and receiving a duty-related retirement, due at least in part because of her back pain and other general pain. The magistrate found that the plaintiff had an ongoing condition and disability related to the injury of January 1990 and plaintiff was entitled to reasonable and necessary medical expenses related to her mental health, including Posttraumatic Stress Disorder and Depression. The magistrate did not find her entitled to medical treatment expenses related to any orthopedic condition. The Commission confirmed the magistrate’s finding of total disability as the result of the 1990 incident at work as fully supported by both medical witnesses on behalf of the plaintiff, treating practitioners and other examining expert witnesses.
Gino Soave v. City of Dearborn, 2014 ACO #15. This case discusses what is necessary to find mental disability under the significant manner test. The fact pattern in this case is very long and detailed. Essentially it involves a police officer who claimed that the cumulative trauma of his job as a police officer caused him mental disability that disabled him from work. The defense contends it was not the cumulative trauma of work, but the plaintiff’s criminal conviction that caused plaintiff’s mental disability. The Commission found that the magistrate appropriately selected the most persuasive medical testimony to find that plaintiff suffered from PTSD as a result of work events. However, the Commission remanded the case to the magistrate for a Stokes analysis. The case is significant in that it demonstrates the Commission’s adherence to the proposition that even though pathology (whether physical or mental) can be linked to a work event, there is no presumption of legal disability. In seeming contrast to the case above, the Commission requires that no matter what the medical diagnosis, the magistrate must still make a determination with regard to wage loss. The holding is also significant in that it applies the “significant manner test” not to the finding of work place injury but to the finding of the relationship of a mental disorder to disability. In essence, only after the plaintiff proved a mental condition, then does the magistrate apply the Stokes analysis to determine whether plaintiff has proven a disability. If the magistrate concludes plaintiff suffers disability, then the magistrate must apply the significant manner test to determine the work-relatedness of same. In this case, which likely distinguishes it from the case above, the plaintiff had a criminal charge which necessitated him from resigning from his position. Accordingly, further analysis was warranted to determine whether it was the mental disability or the criminal charge the resulted in plaintiff’s claimed wage loss. Thus, the Commission stated, without a finding of disability, the magistrate erroneously awarded benefits related to the plaintiff’s mental condition.
WAGE LOSS
Impact of Criminal Activity on Wage Loss
Robert A. Cole v Consumers Energy Company, 2014 ACO #4. In this case, the plaintiff testified that in the four years prior to his 2010 injury he embezzled funds from his union. Eventually, the plaintiff plead guilty to three felony charges. After plaintiff began embezzling funds in 2006, he was injured at work. In October 2006, the plaintiff suffered an injury to his cervical spine. After surgery, plaintiff returned to work without restrictions in May 2007. On February 28, 2010, the plaintiff slipped and fell at work causing further injury to his cervical spine. By June 2010, plaintiff’s doctor restricted him from performing certain physical components necessary to execute job assignments. Following Stokes’ guidance to establish a wage earning capacity and subsequent wage loss, §361(1) requires an additional inquiry when the injured worker is unable to perform or unable to obtain work because he commits a crime or is in prison. Specifically, §361(1) notes that, “An employer shall not be liable for compensation under §351, 371(1), or this subsection for such periods of time that the employee is unable to obtain or perform work because of imprisonment or commission of a crime.”
Despite the plaintiff’s criminal convictions, the magistrate granted plaintiff benefits for his neck injury. The Commission found that the magistrate failed to properly evaluate the disability, wage loss and commission of a crime components of the Act. Specifically, the Commission stated that plaintiff’s testimony established that he began committing the crime of embezzlement sometime in early 2006. Instead of exploring the impact of the commission of the crime, the magistrate only considered the impact of the felony convictions in his analysis. Accordingly, this violates the last sentence of §361, which clearly mandates exploration of the impact of the commission of the crime, as well as any imprisonment. Additionally, the magistrate erred when he failed to recognize that Stokes, Harder, and the lead opinion in Sweatt all require an evaluation of wage earning capacity. Before plaintiff suffered his first injury in 2006, he committed his first crime. Therefore, to properly analyze plaintiff’s wage earning capacity at the time of either injury, the analysis needed to include an evaluation of whether embezzling funds impacts wage earning capacity. In other words, the magistrate failed to contemplate whether the commission of the crime changed plaintiff’s wage earning capacity before the injury occurred.
Because plaintiff committed the crimes before his disabling injury, the magistrate must consider whether the commission of the crime prevented plaintiff from performing or obtaining his jobs at his maximum wage earning capacity. We find that the ability to conceal either the crime or the convictions does not relieve the plaintiff’s burden of showing it did not adversely impact his wage earning capacity. Again, the magistrate’s analysis failed to recognize that before plaintiff suffered any injury in 2010, he had admitted to committing a crime, eliminating the possibility that the crime’s impact on employability was in any sense hypothetical or inchoate.
Miscellaneous
Independent contractor vs. employee
Auto Owners Insurance Company v All Star Lawn Specialists and Jeffrey Harrison and Joseph Derry, (Michigan Supreme Court, November 26, 2014). The Michigan Supreme Court reversed the special panel majority of the Court of Appeals’ interpretation of the definition of an employee as found in MCL 418.161(1)(N) prior to being amended in 2011. The special panel majority incorrectly found that all three of the statutory criteria in MCL 418.161(1)(N) must be met before an individual is divested of employee status. Rather, the term “employee”, as defined in the WDCA, was properly interpreted by the Court of Appeals in Amerisure Insurance Co. v Time Auto Transportation, Inc. In Amerisure, the Court of Appeals ruled that once one of the three provisions occurs, the individual is not an employee. The three criteria that must be met for a person “performing service in the course of the trade, business, profession, or occupation of an employer at the time of the injury” to be considered an employee or that a person “in relation to the service”:
- Does not maintain a separate business;
- Does not hold himself out to and render service to the public; and
- Is not an employer subject to this Act.
Thus, each provision must be satisfied for an individual to be an employee. As a result, if a person, in relation to the service in question, maintains a separate business or holds himself or herself out to and renders service to the public or is an employer subject to this Act (i.e. if the person fails to satisfy any one of the three criteria), then that person is excluded from employee status.
Retaliatory Discharge Claim
Nancy Snyder v Aldi, Inc., (Court of Appeals, September 2, 2014). In this case Plaintiff filed a workers’ compensation claim and then was fired a few days later after it was discovered she falsified the date on the accident report she filled out to report the injury. Plaintiff filed the complaint against her former employer alleging that the employer terminated her employment as a shift manager in retaliation for exercising her rights under the WDCA regarding an alleged work injury. The Court found the plaintiff failed to produce either circumstantial or direct evidence of a causal connection between the protected conduct and termination of plaintiff’s employment. As part of her direct testimony, plaintiff testified that she was unable to locate any accident report forms. Plaintiff checked for one week and there was no accident forms in the store. On August 1, 2009, seven days later, she located a stack of accident report forms. In the accident report, plaintiff indicated that the accident occurred on July 23, 2009, which was consistent with her claim, but she dated the report July 26, 2009 in two places. It was also evident that she initially dated the report July 24, 2009, before changing it to July 26. There is no dispute that the plaintiff filled out the report on August 1, 2009. The Commission concluded that the defendants articulated a legitimate, non-retaliatory reason for her discharge, i.e. falsification of the accident report. Aldi’s handbook provided that an employee was subject to discipline, up to and including termination, for “falsification of company documents”, and backdating the accident report certainly qualified as falsifying a company document.
Kathleen Larue v Gary Mulnix DDS, (Court of Appeals, October 21, 2014). The Court of Appeals affirmed the trial court’s determination that the plaintiff, a dental hygienist, could not establish a prima facie case that she was discharged from employment with the defendant for retaliation for her pursuit of workers’ compensation benefits. Evidence indicated the plaintiff was terminated one month after she was injured at work. The defendant contended that the plaintiff was terminated for poor work performance, not in retaliation for the workers’ compensation claim. In affirming, the trial court summary disposition in favor of the defendant, the appellate court noted that a correlation between the time of the protected activity and the time of the adverse employment action does not, by itself, demonstrate a causal relationship. Further, even if the plaintiff established a prima facie case, the record confirmed that the defendants met their burden of demonstrating legitimate business reasons for terminating the plaintiff’s employment.
Evidence established that the plaintiff was not properly cleaning teeth or timely providing x-rays. In addition, the trial court properly found that plaintiff did not demonstrate that the defendant’s legitimate business reasons were a pretext. Dr. Mulnix supervised plaintiff for 27 days between the time he purchased the practice and time when plaintiff was injured. Upon inspection after plaintiff cleaned a patient’s teeth, he averred, he more than once requested that plaintiff remove the remaining calculus. He asserted that he even rescheduled a cleaning once due to the amount of remaining calculus and informed family members to avoid plaintiff’s cleanings. He further averred that he personally reviewed about 10 patient records of patients treated by plaintiff between October 22, 2010 and December 3, 2010 that demonstrated plaintiff’s poor job performance, including poor calculus cleanings and failure to timely provide x-rays.
Coordination and Reimbursement
Frankenmuth Mutual Insurance Co. v Michael Osterhout, 2014 ACO #35. The Commission affirmed the magistrate’s ruling that the workers’ compensation carrier was entitled to recoup benefits paid to the employee, who received payments from his employer under a wage continuation plan in addition to disability payments made by the carrier. The Commission found that the employee’s receipt of wages from the employer along with workers’ compensation benefits from the carrier was an intentional act on part of the employee. The Commission further found that the employer’s policy to pay full wages to injured employees who missed work was a wage continuation plan within the meaning of MCL 418.354(1)(B). The Commission went on to reject the employee’s assertion that pursuant to case law, the carrier’s voluntary payment of weekly wage loss benefits cannot give rise to a recoupment obligation. The case law only applies when there is no intent on the employee’s part to collect benefits and wages from both the employer and carrier without informing the carrier. The plaintiff ignored the unchallenged findings of the magistrate as to the motives of both the employer and the employee: neither intended to provide any information to the carrier on a voluntary basis regarding the employer’s wage continuation policy.