*/
Workers’
Compensation Board
OPINION
ENTERED: June 20, 2014
CLAIM NO. 201176092
RHONDA FOX PETITIONER
VS. APPEAL FROM HON. DOUGLAS
GOTT,
ADMINISTRATIVE LAW JUDGE
SAM’S CLUB
and HON. DOUGLAS GOTT,
ADMINISTRATIVE LAW JUDGE RESPONDENTS
OPINION
AFFIRMING
*
* * * * *
BEFORE: ALVEY, Chairman, STIVERS and RECHTER, Members.
STIVERS,
Member.
Rhonda
Fox (“Fox”) appeals from the February 25, 2014, Opinion and Order of Hon.
Douglas Gott, Administrative Law Judge ("ALJ") in which the ALJ
sustained Sam's Club's October 21, 2013, Motion to Dismiss Fox's claims for income and medical benefits because
both were barred by the statute of limitations, KRS 342.185. No petition for
reconsideration was filed.
The Form 101, filed September 3, 2013,
alleges on January 21, 2011, and August 30, 2011, Fox injured her neck and back
respectively, in the following manner: "1. Plaintiff was walking into work
and was hit by a truck. 2. Plaintiff was lifting some grills when she felt
pain."
On October 3, 2013, Sam's Club filed a
Special Answer in which it asserted, in part, as follows: "G. Running of
periods of limitation or repose under KRS 342.195, 342.270, 342.316, or other
applicable statute." On October 3, 2013, Sam's Club filed a Notice of
Claim Denial in which it denied the claims for several reasons, one being the
claim is barred by the statute of limitations. After "Explain," Sam's
Club wrote as follows: "Under investigation, to be supplemented upon
completion."
On October 21, 2013, Sam's Club filed
a Motion to Dismiss asserting Fox's Form 101 is barred by the statute of
limitations and requesting the claims be dismissed with prejudice.
On December 11, 2013, Sam's Club filed
an "Amended Special Answer" in which it withdrew all of its previous
special defenses except for the running of the periods of limitation and
repose. Additionally, on December 11, 2013, Sam's Club filed an "Amended
Notice of Claim Denial" in which it maintained the claims were denied
because of the statute of limitations. After "Explain," Sam's Club
wrote as follows: "The claims were not filed within two (2) years of
either injury, pursuant to the applicable statutes. No TTD benefits were
paid."
The December 9, 2013, "Telephonic
Conference Order and Memorandum" indicates, in part, as follows:
"Parties agreed to cancel 1-15-13 BRC, & have Hearing scheduled on
bifurcated issue of limitations."
The January 23, 2014, order states, in
relevant part, as follows: "The parties have advised the ALJ of their
agreement to submit the bifurcated issue of whether Plaintiff's claim is barred
by limitations. It is so ordered." The February 25, 2014, Opinion and
Order reads as follows:
Statement of the case
This claim
has been bifurcated for a decision on whether the claims of Plaintiff Rhonda
Fox are barred by limitations. Fox’s
Form 101 alleges injuries while working for the Defendant on January 21, 2011,
and on August 30, 2011. Her claim was
filed on September 3, 2013. Because that
filing was more than two years after the two dates of injury, the Defendant
seeks dismissal. Fox argues that the
Defendant’s failure to make voluntary payments, or the lack of reporting its
denial of such payments, has tolled the limitations period.
KRS
342.185(1) and KRS 342.270(1) require a claim to be brought within two years of
the date of injury, or, if voluntary payments have been made, within two years
of the cessation of those payments. In
this case, it is undisputed that no voluntary income payments were made; and
that Fox did not file her claim within two years of either date of injury. Therefore, there must be a circumstance
serving to toll the limitations period and estop the Defendant from relying on
the limitations defense.
Fox relies on
KRS 342.040(1), which states in pertinent part:
Except as provided in KRS 342.020, no income benefits shall be payable for the
first seven (7) days of disability unless disability continues for a period of
more than two (2) weeks, in which case income benefits shall be allowed
from the first day of disability....In no event shall income benefits be
instituted later than the fifteenth day after
the employer has knowledge of the disability...If the employer’s insurance
carrier or other party responsible for the
payment of workers’ compensation benefits should terminate or fail to make payments when due, that party
shall notify the executive director of
the termination or failure to make
payments and the executive director shall, in writing, advise the employee
or known dependent of right to prosecute a claim under this chapter.
(emphasis added to
provisions relied upon by Fox)
Findings and
Conclusions.
I. January 21, 2011 injury
claim.
This claim is
clearly time barred. Fox testified that
she never sought medical treatment and never missed any work following this
injury. Therefore, there was never an obligation under KRS 342.040 for the
Defendant to have paid temporary total disability benefits, and, consequently,
no requirement for the Defendant to have provided any notice of denial of such
benefits. An employer has no duty to notify DWC that it was not paying benefits
if the claimant was never entitled to such benefits. J & V Coal Company v. Hall, 62 S.W.3d 392 (Ky. 2001). Fox’s
argument that undisputed permanent impairment separately triggers a requirement for payment and
notification (as discussed within the second claim below) is not applicable to
this claim because there is no evidence of any permanency; Fox’s own evaluator
did not assign impairment for this injury.
II. August 30, 2011 injury claim.
Fox argues
that (1) she was owed “income benefits” (2) because of the Defendant’s
“knowledge of her disability” within the limitations period, and (3) that its
failure to have notified DWC of its refusal to “make payments when due” tolls
the statute. The ALJ disagrees.
“Income
benefits.” For
this section, the ALJ addresses Fox’s argument that the “disability” for which
she was owed “income benefits” was temporary total disability. (Her claimed entitlement to income benefits
for being permanently partially disabled is addressed in the next section.)
“Temporary total disability” is defined at KRS 342.0011(11)(a) as the condition
of an employee who has not reached maximum medical improvement from an injury
and has not reached a level of improvement which would permit a return to
employment.
The ALJ makes
two findings in conjunction with Fox’s argument that she was owed TTD, and that
the Defendant’s failure to have paid it tolls the limitations period. First, if
Fox believed that she had been wrongfully denied TTD, she had to assert that
claim with a timely filed Form 101, which she did not do. She cannot present a stale claim to assert
that she should have been paid TTD, and that if she had been paid TTD then the
carrier would have been required to send the notice to the DWC when it was
terminated, which would have prompted the “WC-3” letter from the DWC advising
her that she had two years from the date of termination to file her claim.
Alternatively,
Fox has not proven that she was entitled to TTD benefits. She continued to work for the Defendant after
the injury, but she argues that she missed more than seven days of work and
therefore became entitled to TTD.
Specifically, she interprets attendance records from the Defendant as
showing that she missed nine days on account of her work injury over a period
of three years. (Brief, p. 6). The ALJ believes it was Fox’s burden to
demonstrate that she missed eight or more days work because of disability from
her work injury, and she did not do so. Snawder
v. Stice, 576 S.W.2d 276 (Ky. App. 1979).
In her Brief, Fox identified 35 missed days over the three years, and
conceded that the “vast majority” of them were for vacation or “comp time.”
(Brief, p. 5). The notation on the attendance records for the other dates is
simply “off,” and Fox asks the ALJ to accept that such “means she was of work
due to reasons related to her back injury.” (Id.) The ALJ is unwilling to
accept such a proposition. First, Fox’s own testimony contradicts the argument
that she missed more than eight work days because of her injury. She plainly
testified that she was aware of only two missed work days. (depo, p. 63). Second, she failed to present any doctor’s
appointment statements or other off-work medical statements to support her
claim that the work injury caused her to miss work on those days.
“Knowledge of disability” requires “payment.” The “knowledge of
disability” to which Fox refers here is alleged permanent partial disability.
The references to “income benefits” and “disability” within KRS 342.040(1) are
commonly viewed by practitioners and adjudicators in the context of temporary
total disability income benefits; in fact, all of the reported (and unreported)
cases involving a carrier’s alleged failure to comply with the notification
requirement of the statute deal exclusively with TTD. But Plaintiff accurately
points out in her Brief that the statute makes no distinction between temporary
and permanent disability in analyzing entitlement to “income benefits” under
KRS 342.040(1). In a case involving PPD payments, the Court in Pierson v. Lexington Public Library, 987
S.W.2d 316 (Ky. 1999), said that “KRS 342.040(1) refers only to ‘disability’
and does not distinguish between temporary and permanent disability.” Id. at 319.
Fox argues
that when the Defendant’s own evaluator assigned permanent impairment she
became entitled to permanent income benefits for the corresponding disability.
Dr. Banerjee’s report was issued on March 22, 2013. Thus, according to Fox, the
Defendant had “knowledge of (her) disability” prior to the expiration of the
limitations period, failed to “make payments when due,” and failed to notify the
DWC that it was not making such payments.
Fox advances
a novel theory under this long-standing statute for maintaining the viability
of her Form 101. The ALJ does not believe the legislature intended the
interpretation urged by Fox; and does believe that the practice of workers
compensation cases would be turned on end if it was adopted. The Workers
Compensation Act establishes an adversary proceeding, and the claimant has the
burden of proof. The Act does not impose a duty to pay permanent income benefits
absent ALJ approval of a Form 110 settlement agreement pursuant to KRS
342.265(1), or after the filing of a Form 101 when liability is dictated by an
award. There is no provision for an “advance” on
There are
adverse practice consequences to tolling the limitations period when evidence
of permanency develops during the two-year limitations period. For example,
employers and carriers will stop having claimants evaluated. These evaluations
are for settlement evaluation purposes and without them fewer claims will be
settled; and that is contrary to a strong public policy that encourages prompt
settlement of workers compensation claims with minimal litigation expense. Whittaker v. Pollard, 25 S.W.3d 466 (Ky.
2000).
The policy
encouraging prompt resolution of claims is further thwarted if an injured
worker obtains evidence of undisputed permanency in an [sic] compensable claim and
then has no time constraints on filing her claim. Without litigation initiated
within the limitations period, an employer could be deprived of the opportunity
for meaningful discovery that might lead to impactful information not
previously known; or prevented the opportunity for timely medical evaluations
that it did not appreciate the need to schedule. Related to that would be an
employer’s concern of how frequently to have the claimant evaluated while
waiting to see if she files a claim; or whether it should have the claimant
periodically put through intrusive surveillance to monitor activity while
waiting to see if a claim will be filed. (Fox’s inaction in this case prevented
a prompt settlement of her claim. She was sent a settlement offer on June 3,
2013, based on Dr. Banerjee’s impairment rating, and had about 90 days to
accept one of two options offered by the Defendant or file a Form 101 before
the limitations period expired.)
Another
complicating circumstance associated with potential, indefinite tolling of
limitations in a case like Fox’s is the impact on medical benefits, the
employer’s liability for which terminates with the expiration of the
limitations period. A finding for Fox would create employer liability for
medical expenses for more than two years after an injury as long as the
claimant possessed a medical report documenting that she had undisputed work
related impairment.
Yet another
complication would be the case where there is undisputed work related
impairment, but a difference of medical opinion on the extent of disability,
i.e., divergent impairment ratings, possible total disability, or application
of multipliers. Theoretically, adopting
Fox’s theory could allow a claimant to accept voluntary PPD payments for
400-plus weeks, and then, prior to the expiration of the 425-week period of
PPD, file a Form 101 to claim extended income benefits for total disability.
Fox posits that if the employer does not initiate voluntary payments at least
at the low end of what the evidence suggests, it has violated KRS 342.040(1).
(Brief, p. 8). The ALJ does not believe
that appellate bodies will agree.
“Notify” DWC of
“failure to make payments when due.” An employer’s failure to satisfy the
notification requirement of KRS 342.040(1), thereby negating the letter from
the DWC advising an injured worker of her right to make a claim, acts to toll
the limitations period and estops the employer from relying on that defense. H.E. Neumann Co. v. Lee, 975 S.W.2d 917
(Ky. 1998). It is undisputed in this case that the Defendant provided no notice
to DWC that it was not making payments to Fox. However, as found in the
preceding sections, there were no “payments” that were “due” Fox by the
Defendant, and therefore it had no reporting requirements. J & V Coal Company, supra.
In deciding this case, the ALJ was mindful
that the Workers Compensation Act is remedial in nature and requires liberal
construction to affect its “humane and beneficent purposes.” Wilson v. SKW Alloys, Inc. 893 S.W.2d
800, 802 (Ky. App. 1995). And the ALJ was further mindful that the history of
the Act demonstrates that the legislature has sought to broaden rather than
restrict the coverage it affords. Princess
Mfg. Co. v. Jarrell, 465 S.W.2d 45, 48 (Ky. 1971). However, the Wilson court also said that while liberal construction is proper to
effect beneficent purposes, a statute should not be construed so as to give a
meaning that the language of the statute does not fairly and reasonably
support. The ALJ finds that the Defendant’s actions, or inactions, considered
in the context of KRS 342.040(1), do not toll the limitations provisions of KRS
342.185(1) and KRS 342.270(1) so as to create a timely filed Form 101 in this
case.
The Defendant’s motion to dismiss is sustained.
On appeal, Fox asserts that pursuant
to KRS 342.040(1), she was entitled to voluntary permanent partial disability
("PPD") benefits during the two years following the date of her
injury.[1] Fox asserts Sam's Club's failure to pay
voluntary PPD benefits tolled the statute of limitations.
As an initial matter, it is important
to note that on appeal, Fox is not asserting Sam's Club should have voluntarily
paid temporary total disability ("TTD") benefits; thus, this opinion
will not discuss Fox's entitlement to TTD benefits. Fox makes this clear when
she states as follows:
While the Claimant presented a two-pronged argument to the ALJ
concerning the Employer's failure to pay either TTD or PPD income benefits,
this appeal concerns only the issue of whether the statute of limitation is
tolled as a result of the Employer's failure/refusal to pay PPD income benefits
and/or provide notification to the Commissioner.
Based on the record and Fox’s argument on
appeal, we summarily affirm the ALJ’s decision to dismiss Fox’s claim for the
January 21, 2011, injury. The record reveals Fox did not miss any work after
this injury and Sam’s Club was not required to pay TTD benefits after this
injury.[2]
Further, it is apparent the impairment rating assessed by Dr. Banerjee did not
relate to the January 21, 2011, injury.[3]
Thus, based on Fox’s own analogy, as Sam’s Club did not have an obligation to
pay TTD benefits, it would not have an obligation to pay PPD benefits within
the two year period following the January 21, 2011, injury. Therefore, Fox is
unable to arrive at any reason why the statute was tolled as to the January 21,
2011, injury.
Concerning the August 30, 2011, injury, as
articulated by the ALJ, while Fox's argument that the failure of Sam's
Club to pay voluntary PPD benefits tolled the statute of limitations on her
claim is "novel," there is no support for such an argument. The ALJ
stated:
The Act does not impose a
duty to pay permanent income benefits absent ALJ approval of a Form 110
settlement agreement pursuant to KRS 342.265(1), or until after the filing of a
Form 101 when liability is dictated by the award in an ALJ Opinion.
Indeed, the unambiguous wording of KRS 342.040(1) is only
relevant to when voluntary TTD benefits
are payable. It reads, in relevant part, as follows:
Except as provided in KRS 342.020, no
income benefits shall be payable for the first seven (7) days of disability
unless disability continues for a period of more than two (2) weeks, in which
case income benefits shall be allowed from the first day of disability.
Being unambiguous on its
face, a rule of
statutory construction long accepted by Kentucky courts is that unambiguous
statutes must be applied as written.
"[A]bsent an ambiguity, 'there is no need to resort to the rules of
statutory construction in interpreting it.'" Hall v. Hospitality
Resources, Inc., 276 S.W.3d
775, 784 (Ky. 2008). The legislature's intent
must be inferred "from words used in enacting
statutes rather than surmising what may have been intended but was not expressed.”
Hall v.
Hospitality Resources, Inc., supra. As the statutory language
of KRS 342.040(1) regarding the number of days of disability only has relevance
to the payment of voluntary TTD benefits, it cannot be interpreted as
pertaining to voluntary PPD benefits. Bolstering our interpretation of KRS
342.040(4) as it pertains solely to TTD benefits is the fact that KRS
342.040(2) speaks to overdue TTD benefits.
In addition, as
pointed out by the ALJ, permitting the statute of limitations "to be
tolled in a case like Fox's would have a detrimental impact on the practice and
resolution of workers compensation claims." The ALJ cited to several
reasons which have been cited verbatim in this opinion. Acceptance of Fox's
argument would mean that once an employer receives an impairment rating from a
physician of its choice, it is obligated to pay voluntary PPD benefits or to
advise the executive director of its failure to pay PPD benefits before having
had a chance to investigate the claim, obtain opinions from other physicians, and/or
determine whether the impairment rating was due to a non-work-related injury or
pre-existing active condition. We decline to interpret KRS 342.040(1) in this
manner.
Assuming, arguendo, that Fox's argument regarding KRS 342.040(1) is correct
and that it is equally as applicable to PPD benefits as it is TTD benefits, Fox
has failed to prove that she missed at least two continuous weeks of work
following the August 30, 2011, injury which is mandated by the wording
of KRS 342.040(1). On this issue, Fox testified as follows in her deposition:
Q: The question was, can you identify
any days that you missed for your back, specific days, following your injury on
August 30, 2011?
A: The only specific days after August-
well, like when I went to see- well, I had doctors' appointments.
Q: Yeah, I'm talking about off-work
days where you took the day. Did you take any days- can you identify any days
that you took off work due to any back- or issues associated with your injury?
A: Well, I didn't take a day off, I
don't think, until June when I threw my back out even worse.
Q: Of 2012? What year?
A: Yeah.
Q: Okay.
A: I don't miss work. You can look at
my schedules. I don't miss work for anything.
Q: What day or days did you take off in
June-
A: I don't recall.
Q: -for your back?
A: It's on my schedule. It's on there.
I don't recall what it was. It was like two or three days, I believe. I think
it had CIP on it, call in personal. I think it was the first of June, maybe. I
don't really remember.
Q: I'm looking at the week of June 9
and it looks like you were just off your regular scheduled two days, on the
10th and the 14th?
A: Somewhere it says on there CIP. On that
schedule.
Q: About June- the week of June 16, you
took vacation; do you recall that?
A: Not really.
Q: Okay. Up through- you took vacation
from Saturday, June 16, through Sunday, June 24; do you recall that?
A: No.
Q: And- okay. And the week of June 2,
which would have been the first week of June, these records reveal that you had
your regular scheduled off days on Wednesday and Thursday of that week
beginning June 2. So your records do not appear to reflect that- are you sure
you were off because your work schedule-
A: Well, I saw it on the schedule when
I was looking at those.
Q: Okay.
A: Maybe it wasn't until 2013. I mean,
I've been dealing with this for two years. I can't recall all of it.
Q: Okay.
A: So maybe it was 2013 instead of 2000
[sic]-
Q: Okay.
A: Can I look at that, or one of them,
see if I can find it? Because it's when I was getting my chiropractic treatment
that I had threw [sic] my back out and I had to miss like two or three days of
work. Well, I missed two days. I think I may have been off the third day.
Q: Okay. This is 2013 records beginning
June 1, and it shows you took two vacation days, on June 1 and June 2, and had
a comp day on Friday the 7th. And then the next week of June 8, you had your
regular off days on the 11th and 12th. And this is the week of June 14. You had
off days scheduled on the- I'm sorry, that's May. Strike that. I went the wrong
way.
A: The schedule specifically has a CIP
on it, because I saw it when I was looking at the schedules.
Q: Okay.
A: I just don't remember what month it
was. I know it was in the summer.
Q: Yeah, here's your regular off days
the week of June 15. You had your two regular off days, correct?
A: Right.
Q: And then the week of the 23rd of
June, you had your regular two off days on the 25th and 27th, correct?
A: Right.
Q: And then the last two days in June,
29th and 30, you have requested?
A: I'm pretty sure it had to be 2012,
though, because that's when I was doing my chiropractic was in 2012, I believe,
not 2013.
Q: Okay.
A: 2013 was more physical therapy
instead of chiropractic.
Q: Okay. This is the week of- beginning
Saturday, May 26, 2012, and you had your regular off days on Sunday, May 27,
and Monday, May 28. And is this what you're referring to, CIP?
A: Yes.
Q: On Tuesday, May 29, and Wednesday,
May 30?
A: Yes.
Q: Okay. And what does CIP mean?
A: Call in personal.
Q: Okay. And it's your testimony today
that you remember that you were off for your back on those two specific days?
A: Yes.
Q: Okay. Any other specific days off
for your back that you can identify?
A: I mean, as far as my back just
hurting and not being able to come to work, no. As far as doctors' appointment
and physical therapies and all that, I mean, that's in the record. There were-
you know, I tried to do most of them off the clock or most of them on lunch and
things like that, so- which took maybe a half an hour away from work, not like
a whole day. When I went to see Dr. Banerjee, that took a whole day.
Q: Yeah, I'm sorry, my question was off
for back problems, not treatment or something like that.
A: Okay.
Q: So you identified those two days in
May?
A: Yes.
Therefore, using Fox's own argument and analogy, she did
not meet the threshold number of missed days in order to trigger the provisions
of KRS 342.040(1) requiring the employer to pay income benefits or notify the
executive director of its failure to make payments. Thus, KRS 342.040(1) is
inapplicable.
Accordingly, the February
25, 2014, Opinion and Order is AFFIRMED.
ALL CONCUR.
COUNSEL
FOR PETITIONER:
HON JAMES D HOWES
5438 NEW CUT RD #201
LOUISVILLE KY 40214
COUNSEL
FOR RESPONDENT:
HON H DOUGLAS JONES
P O BOX 0095
FLORENCE KY 41022
ADMINISTRATIVE
LAW JUDGE:
HON
DOUGLAS W GOTT
400
E MAIN ST STE 300
BOWLING
GREEN KY 42101
[1] Fox does not specify to which injury she is
referring. However, it appears her argument is directed to August 30, 2011,
injury as her argument revolves around the fact Dr. Banerjee assessed a 7%
impairment for the August 2011 back injury.
[2] In her deposition, Fox was unable to identify any days missed because of back problems between the first injury and the second.
[3]
Dr. Banerjee’s March 22, 2013, report
speaks only to a diagnosis and impairment rating for the August 30, 2011,
injury.