Opinion
No. 88-CA-1702.
March 30, 1989.
APPEAL FROM CIVIL DISTRICT COURT, PARISH OF ORLEANS, DIVISION I, STATE OF LOUISIANA, HONORABLE BERNETTE J. JOHNSON, J.
Edward R. Drury, Jefferson, for plaintiff/appellee.
J. Guy, Romano, Metairie, for defendants/appellants.
Before SCHOTT, C.J., and ARMSTRONG and PLOTKIN, JJ.
This is a worker's compensation case. Plaintiff, a truck driver, was injured on the job when a tire he was changing exploded. He first filed his claim for benefits with the Office of Worker's Compensation of the State Department of Labor which recommended that benefits be paid for temporary total disability together with penalties and attorney fees. The employer and his insurer rejected this recommendation and suit followed. The trial court found that plaintiff was temporarily totally disabled and awarded him commensurate benefits with penalties and attorney fees. Defendant, the compensation insurance carrier, has appealed.
The principal issue is whether evidence produced by defendant showing that plaintiff was seen driving trucks from the time of the accident until the date of trial precludes the award for compensation benefits, penalties, and attorney fees.
On November 6, 1985 plaintiff was in the process of changing a truck tire when it exploded propelling the rim into his face. He was taken to Charity Hospital for emergency treatment. The records show that he suffered a laceration of the forehead and an open fracture of the frontal sinus bone with bone fragments pushed into the sinus cavity. A plastic surgeon cleaned the wound and connected the bone fragments into position before closing the wound. A CAT scan showed no abnormalities. He returned to the hospital three times for follow up treatment. Plaintiff continued to suffer with constant headaches, eye problems, and sensitivity to noise and light.
On February 17, 1986 plaintiff was examined by Dr. Gary F. Carroll, an internist. He recommended that plaintiff have a neurological evaluation to deal with his diagnosis of persistent headaches after head injury.
On August 29, 1986 plaintiff went to Dr. Jose Garcia Oller, a neurosurgeon, for a neurological evaluation. Dr. Oller recorded as plaintiff's principal complaint, "Severe headaches and blurring of vision — I can't trust my eyes for driving. I never had headache problems before." Upon examination of plaintiff, Dr. Oller found that plaintiff's reflexes were abnormal on the left side of his body, which indicated some brain involvement. He thought that plaintiff's accident necessarily produced a brain concussion. He described plaintiff's head injury as a compound, depressed fracture of the frontal sinus bone with a laceration of the sutra trochlear artery. He explained that this injury to the artery affected the trigeminal nerve which controls sensation in the forehead and that this injury to the artery and nerve in combination with the concussion caused his headaches as well as his sensitivity to noise and light. As to plaintiff's complaint of blurred vision, he opined that the accident affected the nerves behind the eye which control the pupil so that the pupil does not adjust properly as compared to the other eye causing blurred vision. However, he explained that the condition does not affect visual acuity. He also thought that had a second CAT scan been done a week after the accident it would have revealed delayed bleeding on the brain which would also explain the headaches. Dr. Oller strongly recommended further tests on plaintiff including a CAT scan, a magnetic scan, an EEG, an MRI of the brain and of the cervical spine and a psychological evaluation. He stated that plaintiff was disabled from performing the regular work of a truck driver as a result of these injuries and condition and would remain disabled for a substantial period of time.
Defendant referred plaintiff to Dr. John F. Schuhmacher, a neuro-surgeon. In a medical report he stated that he examined plaintiff on October 7, 1987. Plaintiff complained of constant headaches and blurred vision but Dr. Schuhmacher found no neurological deficits. However, he recommended that plaintiff have a complete neuropsychological evaluation because of "a large amount of depression and operant pain conditioning"; a psychiatric evaluation for his depression, and an evaluation by an ophthalmologist for his alleged visual problems.
On October 17, 1987 Dr. Walter Diaz, an ophthalmologist examined plaintiff and found his eyesight to be virtually normal in spite of some problem with his peripheral vision.
Defendant produced a number of witnesses who testified that they had seen plaintiff at various times and places and on numerous occasions driving trucks since the date of the accident. Most of these witnesses were acquainted or associated with plaintiff's former employer in some way. Dr. Oller testified that plaintiff was disabled as a professional truck driver. Asked on cross examination how this could be when he was seen driving trucks so often Dr. Oller stated that "he was not physically disabled from getting in a truck and driving it from here to Baton Rouge, he can physically do it but he would have headaches, he would have troubled vision, he might be subject to accidents, and I doubt that he could be a professional truck driver, we're talking about 12 hours a day behind that wheel throughout the country."
In finding that plaintiff's disability was temporary and total the trial court stressed plaintiff's need for further testing in order to determine the extent of his injury and the proper treatment for it. This conclusion is solidly supported by Dr. Oller's testimony and to some extent even by defendant's Dr. Schuhmacher.
Defendant assigns error first on the basis of its witnesses who saw plaintiff driving and who flatly contradicted plaintiff's testimony that he had not been able to work and had not once driven a truck since the accident. Defendant also produced video tapes secretly taken of plaintiff by an investigator who conducted a surveillance on plaintiff. Defendant argues that plaintiff's testimony was clearly impeached by these witnesses and tapes. The basis for plaintiff's case was his own testimony that he had recurring headaches, visual problems, and sometimes over sensitivity to noise and light. Defendant seems to suggest that the trial court should have rejected all of plaintiff's testimony and concluded that there was nothing wrong with him after hearing defendant's witnesses.
This court viewed the tapes. They are not clear and do not establish that plaintiff was without disability. As to defendant's witnesses, regardless of their number, their credibility was subject to evaluation by the trial judge who was able to observe their demeanor in person. Aside from their demeanor on the stand which this court cannot appreciate, the record does show that defendant's witnesses could have been biased because of their association with or relationship to plaintiff's employer. The record also shows that these witnesses failed to produce any records to support their testimony even though some of them testified that plaintiff drove for them.
Even if we were to question the trial court's credibility evaluation of these witnesses we would still not be persuaded that there was nothing wrong with the plaintiff. This is so because all the physicians seem to agree that something was wrong. Defendant's Dr. Diaz was careful to restrict his opinion to plaintiff's visual acuity but he found "hysterical field vision," a peripheral vision problem, and he deferred to neuro-surgical opinion and recommended psychiatric evaluation. In his report, Dr. Schuhmacher stated that plaintiff could return to work but the recommended further medical examination for plaintiff. Of course, Dr. Oller recommended a number of further tests to determine what was wrong with plaintiff. The unanimity among the physicians that something was wrong and that further testing was required before plaintiff could be given a clean bill of health seemed to be one of the key factors which led the trial court to conclude that plaintiff was disabled, not permanently, but temporarily.
In large measure, the trial court relied on the testimony of Dr. Oller which defendant would discredit because of its "rambling and hearsay nature" and because of alleged self-contradiction. The trial judge has great discretion in controlling the testimony of witnesses. Especially considering that this was a bench trial we find no error in the trial court's allowing Dr. Oller to ramble. The hearsay defendant complains about was Oller's testimony as to what plaintiff told him in providing the history of his injury and treatment. Defendant argues this was inadmissible based upon Roy v. Commercial Union Ins. Co., 486 So.2d 251 (La.App. 3rd Cir. 1986) in which the court stated: "Any hearsay evidence not necessary to a diagnosis of plaintiff's condition is inadmissible." Despite this pronouncement the court in Ray found that the physician's (the same Dr. Oller) testimony of the contents of medical reports was not sufficiently prejudicial to warrant a reversal. This was a jury trial of a tort suit not a bench trial of a compensation claim. The cited case does not support plaintiff's argument.
With all of the faults alleged by defendant in the testimony of Dr. Oller the trial court had the primary responsibility to evaluate his testimony. From our review of Oller's testimony we are not convinced that the trial court erred in accepting his testimony despite its shortcomings.
Next defendant contends the trial court erred in awarding plaintiff penalties and attorneys fees. Defendant paid compensation benefits to plaintiff from November 7, 1985 until January 15, 1986. Defendant discontinued the payment because of the reports that plaintiff was driving trucks for others. On February 17, 1986 plaintiff was examined by Dr. Gary F. Carroll at the request of plaintiff's attorney. This physician recommended a neurological evaluation and stated that his prognosis was uncertain. The record is devoid of any clear evidence that demand was made upon defendant for benefits until plaintiff filed his claim with the State Department of Labor on May 30, 1986. In support of plaintiff's claim for attorney fees he filed an itemized statement of his attorney's services which includes an entry on April 15, 1986 of "Letter to Hartford", but this letter was not filed in evidence.
When an employer fails to pay benefits each unpaid installment is subject to an added penalty of twelve percent unless non payment results from conditions over which the employer or insurer had no control. R.S. 23:1201. An employer is bound to pay compensation benefits within sixty days after receipt of written notice of a claim by the employee. Failure to pay upon such notice subjects the employer to a reasonable attorney's fee where such failure to pay was arbitrary, capricious or without probable cause. R.S. 23:1201.2.
As to the twelve percent penalty the burden was upon the employer and insurer to show that nonpayment was the result of conditions beyond their control. They discontinued payments because plaintiff was allegedly driving, but the trial court found that the testimony concerning this was not worthy of belief. Plaintiff sustained an injury which defendant considered compensable until these reports surfaced. Defendant took no steps to determine his medical condition but simply discontinued the payments. The trial court's conclusion that plaintiff is entitled to the penalties is not manifestly erroneous.
As to attorney fees the first written notice of plaintiff's claim was in the form of his claim with the State Department of Labor on May 30, 1986. Since defendant could not be compelled to pay attorney fees unless payments were not made within sixty days after this notice plaintiff cannot recover attorney fees for legal services performed prior to that time. On the other hand, plaintiff filed suit on September 17, 1986 and defendant continued to ignore him in spite of the recommendations by Dr. Garcia and Dr. schuhmacher that he have additional treatment. Under these circumstances he was entitled to attorney fees.
Plaintiff answered the appeal seeking an increase in attorney fees. He presented a detailed record of the attorney's time spent on the case until trial time, and for this 135 hours plus the time for trial itself the court awarded $3,500. Even disallowing recovery for services prior to July 1, 1986, we have concluded that this is inadequate, and that plaintiff is entitled to additional attorney fees for the work done in this court in any event. The attorney's fee will be increased to $10,000.
Accordingly, the judgment appealed from is affirmed but amended to increase the attorney's fee to $10,000.
AMENDED AND AFFIRMED.
MEDICAL EVIDENCE
On November 6, 1985, plaintiff was facially injured when a truck tire exploded during the course and scope of his employment with defendant Alexander Trucking. He was taken to Charity Hospital, where he stayed for two days, until November 8. The only treatment he received was debridement of his wounds and splinting of his fractured little fingers. His injuries included a lacerated forehead and an open fracture of the frontal sinus bone. He later returned once to Charity Hospital on November 13, 1985 for observation only.
Plaintiff's next medical examination was performed at the request of his attorney by Dr. Gray Carroll on February 17, 1986. Dr. Carroll testified that he found nothing wrong with Burse, but referred him to a neurosurgeon because of his subjective complaints.
On May 30, 1986, plaintiff filed a claim with the State Department of Labor, and on July 15, 1986, the department recommended the payment of compensation. The defendant refused to consent to the order. The record is devoid of any medical basis for a finding of disability at that point in time. The only medical evidence existing was the Charity Hospital record and Dr. Carroll's reports, both negative in terms of disability. Therefore, the plaintiff was not entitled to receive compensation based on the evidence available at that point in time, despite the recommendation of the department. The defendant's refusal to pay was therefore justified.
The plaintiff was later referred by his attorney to Dr. Jose Oller, a neurosurgeon, on August 29, 1986. In a report dated January 30, 1987, Dr. Oller opined that the plaintiff had sustained an accident-related injury, recommended further testing and found that the plaintiff was disabled from working as a long-distance truck driver. The record does not indicate that this report was ever sent to the defendant. Had the defendant received this report, it would have been put on notice concerning the plaintiff's condition and the refusal to pay compensation would have no longer have been justified. However, since plaintiff failed to prove that the report was ever sent to the defendant, the continuing refusal to pay compensation was not improper.
Plaintiff filed suit September 12, 1986.
The next medical visit occurred October 7, 1987, when the plaintiff was examined by Dr. John F. Schumacker, a neurosurgeon, who found no neurological deficits, but recommended a neuropsychological evaluation because of the plaintiff's emotional problems and complaints. He also recommended an ophthalmological examination. The final medical examination was performed on October 17, 1987, by Dr. Walter Diaz, an opthalmologist, who found that plaintiff's eyesight was normal.
EMPLOYMENT EVIDENCE
Burse testified unequivocally, when asked repeatedly, that he had not worked a single day as a long-distance 18-wheeler truck driver since the accident and that his only income since November 6, 1985 was $200 from odd jobs.
The majority incorrectly dismisses, as discreditable because the trial judge ignored it, the overwhelming and unimpeached testimony of five witnesses, coupled with surveillance films, which indisputably proved that the plaintiff had returned to work as a truck driver, prior to trial.
Defendant Don Alexander testified that the plaintiff called him and asked to be allowed to return to work two weeks after the accident, but that he refused to rehire Burse until he had been discharged by his doctor. Although the trial judge improperly restricted his testimony on this point, Alexander stated that he observed the plaintiff driving dirt-hauling trucks three weeks after the accident and regularly thereafter.
Don Darensbourg stated that he hired the plaintiff as a tractor-trailer 18-wheel dirt-hauler driver for one week in 1987, and that he had observed the plaintiff driving for other companies during the period Burse said he had not worked.
Gilbert Brown also stated that he employed the plaintiff as a truck driver in 1987 for at least two or three months to haul rocks and sand. Burse had most recently worked for Brown the Monday before trial. Brown testified that the plaintiff requested that he be paid in cash for his services in order to avoid making any record of employment which might be used against him at trial.
Frazier Tompkins, a fellow truck driver, stated at trial that he had seen Burse driving trucks some 40 to 50 times during the time Burse said he had not worked.
Dennis Alexander testified that he spoke to the plaintiff after the accident and that Burse told him he was working because he needed money. Alexander stated that he saw the plaintiff working as a tractor-trailer driver and that he saw the plaintiff washing his truck.
Finally, and conclusively, an investigator filmed Burse driving an 18-wheel tractor-trailer dirt truck from his house to the Bonne Carre spillway, where he picked up a load of dirt. The tape unambiguously shows the plaintiff working as a dirt hauler without any apparent medical disability. The films indisputably corroborate the testimony of the defendant's witnesses.
It should be noted that the plaintiff failed to describe his duties, hours of employment or job requirements in the record. Additionally, he failed to rebut any of the evidence that he prevaricated about returning to work.
Therefore, on the issue of compensation, I concur and agree with the majority that Dr. Oller's testimony established that the plaintiff was entitled to workers' compensation benefits. However, those benefits should not begin until the defendant became aware of Dr. Oller's report, since that report was the first and only positive medical statement that the plaintiff had suffered any disability. Since the record indicates that the defendant was never sent copies of the report, I would order payments to begin when the defendant actually received the positive medical report or on the date of the judgment.
PENALTIES AND ATTORNEYS' FEES
The relevant workers' compensation statutes provide, in pertinent part, as follows:
. . . . .
E. If any installment of compensation payable without an order is not paid. . . . there shall be added to such unpaid installment a penalty of an amount equal to twelve percent thereof. . . .
Any employer or insurer who at any time discontinues payment of claims due and arising under this Chapter, when such discontinuance is found to be arbitrary, capricious, or without probable cause shall be subject to the payment of all reasonable attorney's fees for the prosecution and collection of such claim. . . .
(Emphasis added.)
The jurisprudence interpreting the above provisions has established that an award of penalties and attorney fees against an employer for failure to pay benefits due is precluded when the employer has asserted a good-faith defense. Chiasson v. Lafourche Parish Council, 449 So.2d 110, 114 (La.App. 1st Cir. 1984); Norred v. Traveler Ins. Co., 236 So.2d 637 (La.App. 2d Cir.), writ denied 256 La. 842, 239 So.2d 354 (1970). The imposition of penalties under the above provisions is considered harsh; therefore they should not be imposed where a genuine dispute exists. Dupre v. Sterling Plate Glass Paint Co., Inc., 344 So.2d 1060, 1065 (La.App. 1st Cir.), cert. denied 347 So.2d 246 (La. 1977). In such cases, the employer's refusal to pay is deemed to be in good faith and with just cause, but the court should nonetheless consider what information the employer used, of had available in making the decision, to determine whether the failure to pay was justified. Id. Penalties should not be imposed in doubtful cases, where a bona fide dispute as to entitlement to benefits exists. Ceasor v. Belden Corp., 536 So.2d 1261, 1267 (La.App. 3d Cir. 1988); Crooks v. Belden Corp., 334 So.2d 725, 727 (La.App. 3d Cir. 1976).
I believe that the record in the instant case indicates that a bona fide dispute as to the plaintiff's continued entitlement to workers' compensation benefits existed at the time the defendant discontinued the payments. In my view, the defendant presented sufficient evidence to support its belief that the plaintiff not only was able to return to work, but that in fact he had returned to work in the same type of job — driving a truck — that he held prior to the accident. Additionally, the record contains no medical basis for a finding of disability and no evidence that the plaintiff was actually disabled, except the trial testimony of Dr. Oller. The fact that the defendant's good faith belief later turned out to be wrong is insufficient to justify a hindsight finding that the discontinuance of the benefits was arbitrary, capricious and without probable cause, as required by the statutes. Coleman v. Crown Zellerbach Corp., 421 So.2d 300, 302 (La.App. 1st Cir. 1982).
Whether termination of workers; compensation benefits is arbitrary, capricious or without probable cause depends primarily on facts known to the employer at the time of the action. Lee v. Smith, 176 So.2d 413, 418 (La. 1965). In this case, the videotapes and the testimony of the defendant's witnesses prove that, at the time of termination of the benefits, the facts known to the employer were that the plaintiff was apparently able to return to work. Where information available to the employer and compensation insurers was that the injured workman was fit to return to former employment, the employer's refusal to pay further compensation benefits is not arbitrary and capricious even though subsequent events prove that conclusion of fitness to have been in error. Johnson v. Distribution and Transportation Co., 485 So.2d 589, 592 (La.App. 4th Cir. 1986); Jones v. Southern Tupelo Lumber Co., 233 So.2d 264, 267 (La.App. 1st Cir. 1970); affirmed in part, reversed in part, amended, on other grounds, 244 So.2d 815 (La. 1971).
For the above and foregoing reasons, I concur with the majority's decision granting the plaintiff workers' compensation benefits, but would not allow those benefits to begin until the defendant became aware of Dr. Oller's report or until the date of judgment. I also disagree with the majority's awarding the plaintiff penalties and attorneys' fees.
Although I would analyze and interpret the facts differently, I concur in the majority's decision that the plaintiff is entitled to worker's compensation. However, I disagree with the decision concerning when the compensation should begin and with the award of penalties and attorney's fees.