The June 2009 updates for Larson's Workers' Compensation Law were shipped to subscribers.

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Chapter Revisions

120, Third Party's Defenses
131, Reopening Awards
134, Witness Fees; Other Costs; Interest
Ch. 141, Successive Awards in Different States
Ch. 147, Conflicts Involving the FELA
Ch. 150, The Semi-Public Nature of Compensation Insurance
Ch. 153, Rights Between Insurers
Ch. 156, Compensation as Part of General Wage-loss System

Third Party Defenses.  Under most workers' compensation statutes, the third party suit--whether brought by employee or employer--is deemed to be primarily the employee's cause of action.  Accordingly, defenses which would be available against the employee are usually available against the subrogated employer or insurer.  This applies to the statute of limitations, unless modified by statute, and to the employee's contributory negligence.  Conversely, when the employee is the plaintiff, the employer's concurring negligence is generally not a defense, and most cases reach the same result even when the employer is also the subrogee plaintiff.  Chapter 120, which discusses those third party defenses which may be interposed in such settings has been revised and updated.  A substantial line of modern cases holds that the third party may not use as a defense any matter affecting the relations of employer and employee between themselves, and that therefore the statutory assignment of the cause of action to the employer cannot be raised by the third party.

Reopening Awards.  An important aspect of the workers' compensation system of delivering benefits is its flexibility.  For example, awards can often be reopened by the compensation board for modification to meet changes in claimant's condition, such as increase, decrease or termination of disability.   Chapter 131's discussion of reopening awards has been revised and updated as well.  As noted in the chapter, for reasons of administrative practicality, time limits within which such petitions may be brought are usually imposed.   Typical of these time limits is the Oklahoma requirement [Okla. Stat. tit. 85, § 43(B) (Supp. 2007)] that the employee must request a hearing and final determination within three years from either the date of filing of the claim or the date of the last payment.  In Stenhouse v. Multiple Injury Trust Fund, 2008 OK CIV APP 67, 190 P.3d 1194 (2008), the employee received his PPD benefits in a lump sum.  More than three years after receipt of the sum, he sought to reopen for change of condition.  Reversing the workers' compensation court, which found the employee’s request to reopen untimely, the appellate court held that if the employee had received his PPD benefits on a weekly basis, instead of in a lump sum, he would have received payments until May 2006, well within the three-year limit.  According to the court, the date of the conclusion of equivalent weekly payments was the date to be used for determining the Fund's liability because of the legislature's intent to treat all Fund claimants alike, regardless of the mode of payment of PPD benefits [see Ch. 131, § 131.02[2][c] n.21].

Witness Fees; Other Costs; Interest.  Chapter 134, which discusses the general rule that witness fees and other expenses incurred in connection with a compensation hearing must ordinarily be borne by the party incurring them, has been updated.  By express statute in a number of jurisdictions, allowance is made for recovery of some fees and expenses if the injured employee is "successful."  How much "success" is required is subject to some interpretation.  For example, in a recent case from Ohio, Azbell v. The Newark Group, Inc., 2008 Ohio 2639; 2008 Ohio App. LEXIS 2233 (May 27, 2008), the appellate court held it was error to deny reimbursement for claimant's expert witness's fees because, while claimant did not succeed on all claims, the expert supported all claims, and it was difficult, if not impossible, to apportion the fees and costs between the successful and non-successful ones [see Ch. 134, § 134.02 n.1].  Practitioners should be aware that on appeal, costs can usually be assessed against the losing party under general costs statutes and that some states also allow the claimant to collect interest on unpaid benefits.

Successive Awards in Different States.  The Chapter 141 discussion related to the "double recovery" problems that arise from the fact that an injured employee may sometimes be able to recover benefits under the workers' compensation laws of more than one statute has been revised and updated.  The chapter discusses the legal and historic importance of three United States Supreme Court decisions: Magnolia, McCartin, and Thomas and concludes that multiple awards can apply to a single compensable injury, so long as each state has a relevant interest in the case.  The injured employee is due but one total recovery, however.  Successive awards can be made in different states, so long as the first award is deducted from the second.

Conflicts Involving the FELA.  At the heart of most "conflicts" cases is the fact that there can be a marked difference in generosity of benefits between two competing statutes and often the injured worker is at a characteristic disadvantage in making an informed election between the respective remedies.  The conflicts problem can be particularly difficult and confusing when it involves the intersection between the Federal Employers' Liability Act [which gives employees of interstate rail carriers an action in negligence against their employers, free of the fellow servant and assumption of risk defenses, and with comparative negligence put in place of common-law contributory negligence] and the state compensation acts since the former is an expression of preeminent federal power over interstate commerce and, therefore, state jurisdiction is excluded.  The Chapter 147 discussion of this collision of laws has been revised and updated as well.  Practitioners should observe that in spite of the preeminence of FELA to interstate rail carriers, employees of other interstate carriers, such as motor and air lines, remain proper subjects for state legislation, since the federal government has for the most part made no attempt to legislate as to work injuries in such employments.

The Semi-Public Nature of Compensation Insurance.  Since compensation insurance is for the benefit of the employee as well as of the employer, some of the usual incidents of insurance are modified for the employee's protection.  Defenses, such as nonpayment of premium or breach of policy conditions, which the insurer might have against the employer, are not available against the employee.  Moreover, under many statutes a policy cannot be canceled merely by action of the insurer, the employer or both; notice to the compensation commission is ordinarily required, followed by an interval in which replacement of the insurance can be effected. Chapter 150 has been revised, bringing up to date the discussion of this important aspect of workers' compensation law.  As pointed out in the chapter's discussion, while the commission or other body charged with the responsibility of managing a state's workers' compensation act generally has jurisdiction to pass upon questions of compensation insurance when they affect the rights of the employee, such is not the case where the employee's interests are not at state.  Thus in one recent Louisiana decision, Broussard Physical Therapy v. Family Dollar Stores, 2008 La. LEXIS 2760  (December 2, 2008), where the dispute was between an employer and its Preferred Provider Organization, the court observed that the employer’s claim against its PPO arose not out of the Act, but out of the contract between the two entities.  The PPO could never owe the underlying workers’ compensation obligation and, therefore, could never be a workers’ compensation obligor.  Any claim against such a party belonged in the state’s district court, not before the Office of Workers' Compensation [see Ch. 150, § 150.04[2] n14].

Rights Between Insurers.  Quite often a work-related disability develops gradually, or comes about as the result of a succession of accidents.  Where successive insurance carriers insure the employer's workers' compensation obligation, disputes can arise between the carriers as to which must underwrite the employee's benefits.  Chapter 153, which discusses the resolution of this important issue, has been revised in this release.  Generally, the insurance carrier covering the risk at the time of the most recent injury or exposure bearing a causal relation to the disability is liable for the entire compensation.   For example, in Geathers v. 3V, Inc., 371 S.C. 570, 641 S.E.2d 29 (2007), where the evidence tended to show that the claimant’s disability was caused by a second accident, which aggravated claimant’s pre-existing condition cause by a first injury, and where there had been a change in the employer’s workers’ compensation carrier, the second carrier was responsible for the entire cost of claimant’s benefits [see Ch. 153, § 153.02[1] n.4].  The chapter also discusses the important "last injurious exposure rule," a concept that places full liability upon the carrier covering the risk at the time of the most recent injury that bears a causal relation to the disability.  Determination of these issues is generally driven by the particular facts of the case.  Commissions and courts are often called upon to draw fine lines.  For example, in Lanes v. Mont. State Fund, 2008 MT 306, 346 Mont. 10, 2008 Mont. LEXIS 461 (September 3, 2008), an employee contracted an occupational disease within his left knee while working for his primary employer.  He also served as a part-time minister at a nearby church.  The Montana court held that there was substantial credible evidence supporting the compensation court's factual findings that the employee's duties as a minister did not significantly aggravate his right knee condition; his last injurious exposure was with the employer, not with the church.

Compensation As Part of General Wage-Loss System.   Although the United States is not usually thought to have a ''comprehensive'' social security system, the cumulative effect of existing workers' compensation, unemployment, old-age, and disability plans produces a degree of protection surprisingly close to that afforded under some avowedly comprehensive systems found in other countries.  Chapter 156, the opening chapter in the Treatise's final part 17, dealing with the relationship between workers' compensation and other kinds of wage-loss protection, has been updated and revised as well.  The chapter sets important contextual markers for Part 17's overall discussion and it offers an overview of how the various wage-loss protections work together to lessen the impact of a loss of earning power.

Co-Worker's Jealousy Over Hotel Worker's Treatment of Customers Provides Nexus Between Employment and Hotel Worker's Death.  In Matter of Gutierrez v. Courtyard By Marriott, 46 A.D.3d 1241, 848 N.Y.S.2d 744, 2007 N.Y. App. Div. LEXIS 13248, 2007 NY Slip Op 10421 (2007), a New York appellate court held that a hotel worker's death arose out of her employment where a guest services agent was found murdered in the lower level of the employer's hotel and evidence pointed to the daughter's boyfriend, also an employee of the hotel, as the perpetrator of the murder.  A number of witnesses testified that the boyfriend was overly jealous as a result of the manner in which the deceased dealt with the hotel's customers.  The court indicated that such evidence provided the necessary nexus between the daughter's employment and her death, and constituted substantial evidence establishing that the death arose out of her employment.  [See Ch. 8, § 8.01[1][a] n.23]

Alabama Court Holds Racially-Motivated Attack on Restaurant Manager Did Not Arise Out of the Employment.  The Supreme Court of Alabama recently affirmed a finding that a female restaurant manager, who was assaulted, sexually brutalized, and burned with lit cigarettes as her assailants repeately told her “we’ll show you what we do to ## lovers” [they used a racial epithet], did not sustain injuries arising out of and in the course of her employment.  The court concluded that claimant's injuries were caused by the acts of third parties who intended to injure her for reasons personal to her and not directed against her as an employee or because of her employment.  [See In re: N.J.J. v. Wesfam Restaurants, Inc., 2008 Ala. LEXIS 223 (October 24, 2008). [See Ch. 8, § 8.03D n.30]

Federal District Court Favors State's New Gun Law Permitting Some Employees to Keep Weapons in Locked Vehicles in Employer's Parking Lot.  In Florida Retail Federation, Inc. v. Attorney General of Florida, 576 F. Supp. 2d 1281 (N.D. Fla. 2008), a federal district court indicated—at least for purposes of a preliminary injunction ruling— that the Florida Legislature, in enacting Fla. Stat. § 790.251, acted within its constitutional authority when it afforded a worker with a concealed-carry permit a statutory right to have a gun secured in a vehicle in a parking lot.  The Legislature also acted within its constitutional authority in protecting that right by prohibiting a business from (1) asking such a worker whether he or she had a gun in a vehicle in a parking lot, (2) taking action against such a worker based on a statement about whether the worker has a gun in a vehicle in a parking lot for lawful purposes, (3) searching such a worker's vehicle for a gun, (4) conditioning employment on whether a worker has a concealed-carry permit, or (5) terminating or otherwise discriminating against a worker with a concealed-carry permit for having a gun in a vehicle in a parking lot.  The court indicated, however, that the Legislature violated the United States Constitution when it imposed limitations on a business's treatment of its customers but made those limitations applicable only to a business with a worker with a concealed-carry permit, not to an otherwise-identically-situated business with no such worker.  On August 15, 2008, the district court issued a clarification making it clear that employees with concealed-carry permits only have the right to keep locked guns in their vehicles in employer parking lots; the new law does not authorize a person to carry a gun on his or her person on the property of another without that property owner’s consent.  [See Ch. 9, § 9.03D[1] n.4]

Police Officer's Fatal Injuries Outside Jurisdiction Not Compensable In Spite of Fact That He Was On Call.  In Lockman v. Town of Maringouin, 2008 La. App. LEXIS 1669 (December 12, 2008), a Louisiana appellate court held that a police chief's death was outside the course and scope of his employment in spite of the fact that at the time of the accident he was on call, was driving a police car (with police radio) issued to him, and that he had on his person a cell phone provided to him by his employer.  While he was expected to be on call 24 hours a day, he was outside his jurisdiction at the time of the accident and, according to the court, was not performing any law enforcement action at the time of the accident as required by La. Rev. Stat. Ann. § 23:1034.1.  [See Ch. 14, § 14.05[6] n.37.1]

Correctional Officer's Injury Emptying the Trash Held Not Compensable.  In Matter of Martino v. County of Albany, 47 A.D.3d 1052, 850 N.Y.S.2d 250, 2008 NY Slip Op 153 (3d Dep't 2008), a New York court held held that substantial evidence supported the determination that a correctional officer's injury when he removed a smelly garbage can located within his work area was not causally related to his range of duties and, therefore, was not compensable.  The court discounted the officer's contention that a number of visitors had complained about the odor.  [See Ch. 27, § 27.02[2][b] n.40]

Michigan High Court Finds Employee's Refusal To Attend Martin Luther King Day Event Was Misconduct--Employee's Psychological Injury Claim Resulting From Disciplinary Action Is Not Compensable.  In a rare case in which an employer has successfully defended a claim on wilful misconduct grounds not involving a violation of a safety rule, the Supreme Court of Michigan in Brackett v. Focus Hope, Inc., 442 Mich. 269, 753 N.W.2d 70 (2008) held the employee's wilful refusal to attend the event, in spite of her clear understanding that the event was important to the overall mission of her non-profit employer, was sufficient misconduct so as to disqualify her from recovering benefits for an alleged psychological injury resulting from discipline she received.  The employee had refused to attend the celebration had been moved to Dearborn, where she had bad experiences, and where she contended the city's history of oppression to African-Americans made it an inappropriate locale.   In a 4-3 decision, the high court reasoned that MCL § 418.305 prohibited the recovery of benefits for conduct that was deliberate or non-accidental and that disregarded the employer's interests, including its work rules. [See Ch. 34, § 34.01 n.17]

Marijuana Use, Even At Supervisor's Suggestion, Disqualifies Colorado Claimant From Recovering Benefits.  The Court of Appeals of Colorado, in Gilmore v. Indus. Claim Appeals Office, 187 P.3d 1129 (Colo. Ct. App. 2008), found unconvincing the discharged employee’s claim that his marijuana smoking shouldn’t disqualify him from receiving continuing benefits, since his supervisor told him to smoke the “joint” and the employer’s work rules required that he follow his supervisor’s instructions.  [See Ch. 36, § 36.03[6] n.51.1]

Suicide by Distraught Employee Might Be Compensable, Says Nevada Court.  Citing the Larson treatise, a Nevada court recently ruled that a bartender's suicide following a painful injury and recovery period might well be compensable in spite of the state's willful self-injury exclusion, provided the bartender's survivors could demonstrate that (1) the employee suffered an industrial injury, (2) the industrial injury caused some psychological condition severe enough to override the employee’s rational judgment, and (3) the psychological condition caused the employee to commit suicide [see Vredenburg v. Sedgwick CMS, 188 P.3d 1084, 124 Nev. Adv. Rep. 53 (2008)].  The bartender's doctor hd told him he would never be able to return to work.  Testimony from other witnesses spoke of deep depression that the bartender experienced.  Other testimony indicated that the bartender indicated the medication he took “made [him] think funny.”  [See Ch. 38, § 38.03D n.2]

Pennsylvania Court Says Being Singled Out as a “Non-Muslim” is Sufficient to Show "Abnormal Working Conditions" to Support Mental Injury Claim.  The Pennsylvania Commonwealth Court, in Community Empowerment Ass'n v. Workers' Comp. Appeal Bd. (Porch), 2008 Pa. Commw. LEXIS 582 (November 25, 2008), the worker alleged that she sustained psychological injuries as a result of unwanted sexual advances by the employer's president, and being singled out during meetings for being non-Muslim. The worker submitted a psychology report of a doctor who diagnosed her with major depressive disorder and opined that it was a result of the incidents that occurred while working for the employer.  The court concluded that weekly meetings where the worker was recognized as not being Muslim could certainly be considered abnormal in a professional environment. Also, a purification ceremony was a departure from the normal business environment.  Accordingly, the WCJ did not err in finding that the worker was subjected to abnormal working conditions.  [See Ch. 44, § 44.05[2] n.8.1 and Ch. 56, § 56.06[6] n.38]

Oregon Court: Compensation Is Awarded for “Conditions,” Not “Symptoms.” Compensation may not be awarded for “symptoms,” only “conditions,” indicated an Oregon appellate court recently in Young v. Hermiston Good Samaritan (In re Young), 223 Ore. App. 99, 194 P.3d 857 (2008). The claimant had filed a new or omitted condition claim for lumbar radiculopathy. The employer denied the claim. The Board agreed with the employer's assertion that, under Or. Rev. Stat. § 656.267(1), symptoms did not qualify as "medical conditions" for purposes of a new or omitted medical condition claim.  The appellate court agreed that the distinction that the Board drew between noncompensable "symptoms" and compensable "medical conditions" was correct. Under § 656.267(a) a claim for new or omitted medical condition had to be for a condition; moreover, a condition and its symptoms were usually distinct. [See Ch. 83, § 83.07 n.8]

Police Officer's Conviction of Misdemeanor Charge Constitutes Abandonment of Employment.  A New York appellate court recently held that a police officer’s withdrawal from labor market was voluntary where he was formally terminated based upon his arrest and conviction of misdemeanor. [see Matter of Furrer v. Suffolk County Police Dept., 45 A.D.3d 996, 846 N.Y.S.2d 397, 2007 N.Y. App. Div. LEXIS 11177, 2007 NY Slip Op 8324 (3d Dep’t 2007)]. [See Ch. 84, § 84.04D[1] n.1]

Florida Wages Not Reported To IRS May Not Be Used to Compute Average Weekly Wage.  Where the employer has, in fact, paid the worker, but the worker has not reported the income to the Internal Revenue Service and a Florida statute [Fla. Stat. § 440.02(28)] refers to wages as “earned and reported for federal income tax purposes on the job where the employee is injured,” those wages may not be included in the computation of the worker's average weekly wage [see Fast Tract Framing, Inc. v. Caraballo, 994 So. 2d 355, 2008 Fla. App. LEXIS 14081, 33 Fla. L. Weekly D 2189 (Fla. Dist. Ct. App. 1st Dist. 2008)]. Claimant worked for Mendez, a subcontractor of Fast Tract Framing, a housing contractor.  He was paid in cash and claimant did not report his income to the IRS.  Claimant suffered a compensable accident and sought workers' compensation benefits against Fast Tract, contending it was his statutory employer.  Fast Tract contended it did not owe Claimant benefits because he had earned no wages within the meaning of Fla. Stat. § 440.02(28).  The judge of compensation claims determined that Fast Tract was Claimant’s statutory employer and granted Claimant full temporary total disability benefits for an 104-week period for an average weekly wage of $280 a week.  Fast Tract appealed, and the appellate court reversed.  [See Ch. 93, § 93.01[1][e] n.31.1]

Gastric Bypass Surgery Found Compensable In Treating Knee Injury.  An Oregon appellate court recently held that an injured worker's gastric bypass surgery was compensable because the surgery was performed for the purpose of treating a deep venous condition in the worker's right leg caused by her work-related accident.  That the surgery would also address other health problems caused by the claimant's obesity did not affect her right to compensation [see SAIF Corp. v. Sprague, 221 Ore. App. 413, 190 P.3d 443, 2008 Ore. App. LEXIS 1102 (July 30, 2008), rehearing granted, 345 Ore. 417, 2008 Ore. LEXIS 1028 (2008). [See Ch. 94, § 94.03[3][d] n.64.2]

Frozen Embryo Implanted After Worker's Death is Not A Dependent for Purposes of Workers' Compensation Benefits.  In Finley v. Farm Cat, Inc., 2008 Ark. App. LEXIS 748 (October 22, 2008), an Arkansas appellate court recently held that a frozen embryo implanted after a worker’s death is not a dependent, for purposes of workers’ compensation benefits.  The appellate court stated that it was unnecessary for it to decide whether the child was a "person" at the time of the husband's injury because, assuming for the sake of argument that the child was a "person," there was substantial evidence to support the Commission's decision that he was not "wholly and actually dependent" on the husband at the time of the husband's injury. There was no evidence demonstrating that at the time of his father's death, the son had a reasonable expectation of support from him. The son was a frozen embryo at the time of the death and was not born until almost two years after his father's death.  [See Ch. 96, § 96.05[3] n.43]

Failure to Investigate Special Employee Status May Expose Lawyers to Legal Malpractice Claim.  Defendants, an attorney and his law firm, appealed the order of a New York trial court which denied their motion for summary judgment seeking to dismiss the legal malpractice complaint filed by plaintiff client [see Thompson v. Seligman, 53 A.D.3d 1019, 2008 N.Y. App. Div. LEXIS 6335, 2008 NY Slip Op 6496 (3d Dep't 2008)].  Plaintiff had retained defendants to represent her in a claim for workers' compensation benefits. She also inquired about suing the business she was working at where she was injured for pain and suffering, but defendants informed her she was precluded from pursuing such a claim upon the mistaken belief that she was employed by the business. In fact, plaintiff was employed by an agency that contracted with the business. By the time that plaintiff consulted with a different attorney who advised her that she could have brought a third-party claim for pain and suffering, the statute of limitations had expired. The trial court denied defendants' motion for summary judgment upon determining that plaintiff had raised questions of fact with respect to defendants' duty to investigate her claim and whether they were negligent in performing that duty. The court held plaintiff had established a question of fact as to whether defendants exercised the appropriate degree of care in performing their duty to investigate the availability of the third-party claim.  The court affirmed the order. [See Ch. 110, § 110.03D n.4]

"Firefighter's Rule" Bars Recovery of Wrongful Death Benefits in Shooting of Arizona Police Officers Responding to Disturbance Call.  After an apartment resident shot a person during a confrontation, the two police officers were shot and killed by the shooter when they responded to a 9-1-1 call and kicked in the apartment's front door. The officers' beneficiaries alleged that defendants' employees had previously evaluated the shooter but declined to place him into treatment. The beneficiaries alleged that defendants' failure to properly diagnose and treat the shooter amounted to negligence and resulted in his subsequent violent conduct. The appellate court determined that the beneficiaries could not pursue their negligence claims against defendants because defendants' alleged negligent conduct was protected by the firefighter's rule, which applied to police officers. Defendants' alleged negligence did not fall within the independent negligence exception to the firefighter's rule, because defendants' alleged negligence was not independent since (1) defendants allegedly acted negligently allowing the shooter to remain untreated, resulting in the officers' deaths, and (2) without proof of the shooter's conduct, the beneficiaries would be unable to link defendants' alleged negligence to the deaths of the officers[see White v. State, 2008 Ariz. App. LEXIS 145 (August 26, 2008)].   [See Ch. 110, § 110.08 n.7]

Florida Court Trumps Legislature's Attempt to Limit Attorney's Fees For Claimants' Lawyers; Adjusts Fee from $700 under Schedule to $16,000.  In a recent case that has prompted significant discussion among attorneys within (and without) the state of Florida and potential backlash from the state's legislature, the Supreme Court of Florida held that in spite of amendments to 2003 amendments to the workers’ compensation provisions governing attorney fee awards (Chapter 440, section 440.34) which had deleted any reference to consideration of “reasonable fee” factors, claimant's attorneys were nevertheless entitled to a reasonable attorney fee.  Observing that if the formula set out in the post-2003 version of the statute was followed, the attorneys would have been awarded approximately $8 per hour, the court indicated the following factors should be considered in setting the fee: (1) the time and labor required; (2) the novelty, complexity, and difficulty of the questions involved; and (3) the skill required to perform the legal services properly in accordance with the Rules Regulating the Florida Bar [see Murray v. Mariner Health & Ace USA, 994 So. 2d 1051 (Fla. 2008)].  The court adjusted the petitioner’s attorney fee award from less than $700 to $16,000. [See Ch. 133, § 133.03[3] n.21]

$2,000 Penalty Allowed for Delay in Paying $30 Medical Bill.  In Russell v. Regency Hosp. of Covington, LLC, 2008 La. App. LEXIS 1489 (November 14, 2008), a Louisiana appellate court allowed a penalty of $2,000 for the delay in payment of $30 medical bill.  An additional $2,000 penalty was not, however, justified by the statute. [See Ch. 135, § 135.02[2] n.27.1]