The following summaries of recent noteworthy cases were written by Roland Legal PLLC.

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When Awarding PPD Benefits Begin at the Beginning. The issue on appeal in Sweasy v. Wal-Mart, 2009-SC-000219-WC, ( Ky. 2009) was whether the language of KRS 342.730(1)(d) created a choice for when PPD benefits in a 425 week award commenced. In Sweasy, the ALJ awarded benefits to commence from the time Sweasy reached maximum medical improvement, not from the date of injury.

KRS 342.730(1)(d), the statutory provision at issue, states as follows:

For permanent partial disability, if an employee has a permanent disability rating of fifty percent (50%) or less as a result of a work-related injury, the Compensable permanent partial disability period shall be four hundred twenty-five (425) weeks, and if the permanent disability rating, is greater than fifty percent (50%), the compensable permanent partial disability period shall be five hundred twenty (520) weeks from the date the impairment or disability exceeding fifty percent (50%) arises.

The Workers’ Compensation Board reversed the ALJ’s determination, holding that the benefits should commence from the date of injury. The Court of Appeals reversed the Board and reinstated the ALJ’s determination, interpreting KRS 342.730(1) (d) to mean that an award based on a disability rating of fifty percent or less (a 425 week award) "may or may not begin" when the impairment or disability from an injury arises.

The Court of Appeals interpreted this language to mean that in the case of a 520 week award the benefits would commence as of the date of injury, but in the case of a 425 week award the language failed to specify when that period of disability commences, thus leaving it up to the ALJ to decide when the award would begin.

On appeal, Sweasy alleged her disability began at the time of her injury and argued there was no justification for the Court of Appeals’ interpretation of KRS 342.730(1)(d).

The Supreme Court agreed with Sweasy, reversing the Court of Appeals. The Court disagreed with the Court of Appeals’ interpreting KRS 342.730(1)(3) to allow for benefits to commence from the date of injury for an award of 520 weeks, but not an award of 425 weeks (as in the case of Sweasy).

After discussing precedent relative to statutory construction and examining the underlying policy of the workers’ compensation statute, the Supreme Court considered the Court of Appeals interpretation and held that the “legislature intended no such absurdity,” and that the compensable period for partial disability begins on the date that impairment and disability arise, without regard to the date of MMI, the worker's disability rating, or the compensable period's duration.”

All justices concurred.

Commentary:  The Supreme Court made the correct decision in this claim, although it may have been a bit harsh characterizing the Court of Appeals’ interpretation as an absurdity. This is the second decision of 2009 involving a reviewing Kentucky court’s micro-analysis of a statutory provision resulting in a rejection of plain meaning and the statute’s traditional application. In March of 2009, it was the Supreme Court, not the Court of Appeals, who in Chrysallis House v. Tackett, 2008-SC-000221-WC (Ky. 2009), rendered a rather controversial decision relative to the application of benefit enhancements under KRS 342.730 effectively creating an exception to the phrase “with or without cause” where none had previously existed. This case is discussed in further depth at Roland Legal’s blog OUCH!

At the completion of proof and following the first final hearing, the ALJ entered an interlocutory opinion placing the claim in abeyance based on her finding that Bowerman had not attained maximum medical improvement (per the treating physician’s testimony), but that he had achieved a level of improvement permitting his return to some work, justifying abeyance, payment of medical benefits but not payment of temporary total disability (TTD) benefits. Bowerman filed a petition for reconsideration on the ALJ’s failure to award TTD benefits, but the ALJ denied the petition. Bowerman appealed that denial to the Workers’ compensation Board, who dismissed the appeal since the opinion was not a final appealable order.

Approximately seven months after entry of the interlocutory order, Bowerman motioned to remove the claim from abeyance. Updated medical records were filed followed by a second hearing and the ALJ’s final opinion.

Although the ALJ incorporated her prior findings of fact from her interlocutory order into her final opinion, she then reversed her original factual findings and concluded that as of September 2005 Bowerman had reached MMI and could return to all former work activities, thus adopting the conclusions of the employer’s IME physician.

Bowman filed a petition for reconsideration asserting that the ALJ’s findings in her final opinion should have been consistent with her original interlocutory opinion. The ALJ denied the petition and Bowman appealed to the Workers’ Compensation Board, who affirmed the ALJ.

The Court of Appeals reversed with a scathing critique of what it deemed to be a misunderstanding of the law by both the ALJ and the Workers’ Compensation Board.

The Court of Appeals analyzed the ALJ’s decision and the Workers’ Compensation Board’s affirming based on two inquiries: (1) whether the ALJ’s fact-finding discretion extended “to rendering a final opinion in which she completely abandoned and reversed dispositive factual findings initially determined by her in the interlocutory opinion which favored Bowerman and were supported by substantial evidence, absent a showing of new evidence, fraud, or mistake” and (2) “whether the ALJ erred in denying additional TTD benefits when, as initially determined in the interlocutory opinion, Bowerman was found not to have reached MMI and his claim was abated pending completion of medical treatment recommended by his treating physician, reaching MMI, and assignment of an impairment rating.”

After reviewing the procedural history and facts and after a careful and thorough analysis of precedent and analogous opinions, the Court of Appeals held that the two inquires mandated reversal.

The Court determined that factual findings rendered in an interlocutory opinion, absent new evidence, fraud or mistake cannot be reversed. The Court noted the ALJ’s reversal of previously rendered findings was arbitrary, unreasonable, unfair and constituted a violation of statutory authority and sound legal principles. The Court additionally noted that even the Board misinterpreted “its own cited legal authority.”

The Court further held that while abatement in and of itself did not compel payment of TTD, the ALJ’s findings of fact in her interlocutory opinion did. The Court chided the ALJ deeming her denial of TTD demonstrated a lack of understanding of the prerequisites for an award of TTD as she initially denied TTD benefits because she found Bowerman could perform “some type of work.”

The Court held that in so opining the ALJ was applying the standard for permanent total disability (PTD) benefits not TTD benefits. Since Bowerman had not reached MMI and could not return to his previous work duties or customary work, he had satisfied the requirements for an award of TTD under KRS 342.0011(11)(a). The Court reversed and remanded, with Judge Keller dissenting in a separate opinion.

Commentary: In and of itself, the opinion serves as a seminal guide for the standard of review for appeals involving the de novo review of decisions challenged based on a fact-finder’s abuse of discretion. The opinion, some 42 pages, and certainly a longer than normal appellate decision reviewing a workers’ compensation determination, seemed largely geared towards highlighting what the Court considered to be both a clear abuse of judicial discretion and a clear misunderstanding and application of the law by both the fact-finder and the Workers’ Compensation Board. The substantive holding in and of itself seemed elementary, and perhaps that is what precipitated the tenor of the opinion.

Medical treatment for an injured workers’ back pain is compensable even if the original injury was a hip injury, as long as the back pain was a symptom or natural consequence of the original hip injury. Ranger Contracting v. Morley, 2009 Ky. App. LEXIS 151, No. 2008-CA-0010307-WC (Ky. App. 2009) (designated to be published). Claimant originally settled his claim stemming from a work-related hip injury. Subsequent to settlement, claimant moved to reopen the claim seeking compensation for medical treatment of low back pain which he attributed to the original injury. While medical testimony regarding the relationship of the low back pain to the original injury differed, the ALJ relied on claimant’s treating physician who opined the back pain was related to the original injury. The employer challenged the finding on various grounds arguing (1) that claimant was alleging a new injury not brought at the time of the original claim even though it was known to him deeming it barred under KRS 342.270; (2) that the claim was barred by the statute of limitations and (3) that the pain was not causally related to the original injury. In dismissing the employer’s arguments, the Court held that the back pain was compensable, noting that the pain did not constitute a new medical condition or injury and medical proof established it was causally related to the injury. In short, the Court deemed the back pain was a symptom or “natural consequence” of the hip injury even though the claimant did not injure his back in the original work accident.

Commentary: The court’s reasoning was sound, although some legal practitioners and physicians might take issue with the Court’s statement that pain in and of itself is not a medical condition but merely a symptom of a medical condition.

Statutory law controlling distribution of an injured worker’s benefits to his widow upon his death apply whether the benefits are paid by opinion and award or by settlement. Bell v. Consol of Kentucky, Inc., 2009 Ky. App. LEXIS 155, No. 2009-CA-000673-WC (Ky. App. 2009) (designated to be published). Claimant Bell entered into a settlement for benefits to be paid as a result of injuries he sustained in a work-related accident. Bell thereafter died in an un-related accident and his wife motioned to receive the full amounts of the remaining settlement benefits. The ALJ allowed for distribution of benefits to the widow, but only at 50% of the rate specified in the settlement agreement as required under KRS 342.730(3). Bell 's widow essentially argued on appeal that since the benefits were paid per a settlement and not an opinion and award, KRS 342.730(3) did not apply. The Court of Appeals, noting that the claim appeared to be one of first impression, held that KRS 342.730(3) applied with the same effect for a settlement as with an opinion and award.

Commentary: While this claim did appear to address an issue of first impression in Kentucky, the Court was correct in applying the same statutory provision to a settlement as would apply to an opinion and award since Kentucky law conveys the same weight to an approved settlement agreement as it does to an opinion and award. See Jude v. Cubbage, 251 S.W.2d 584 (Ky. 1952) (cited by the Bell court).

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