Opinion
F060628 WCAB No. ADJ1371452
08-26-2011
COUNTY OF FRESNO et al., Petitioners, v. WORKERS' COMPENSATION APPEALS BOARD and PATRICK O'BRIEN, Respondents.
Law Office of Jeremy K. Lusk, Jeremy K. Lusk, for Petitioners. No appearance by Respondent Patrick O'Brien. No appearance by Respondent Workers' Compensation Appeals Board.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
OPINION
THE COURT
Before Gomes, Acting P.J., Dawson, J., and Kane, J.
ORIGINAL PROCEEDINGS; petition for writ of review from a decision of the Workers' Compensation Appeals Board. Alfonso J. Moresi, Joseph M. Miller, and James C. Cuneo, Commissioners. Dominic E. Marcelli, Workers' Compensation Administrative Law Judge.
Law Office of Jeremy K. Lusk, Jeremy K. Lusk, for Petitioners.
No appearance by Respondent Patrick O'Brien.
No appearance by Respondent Workers' Compensation Appeals Board.
The County of Fresno (Fresno) petitions for a writ of review from an order of the Workers' Compensation Appeals Board (WCAB). (Lab. Code, § 5950; Cal. Rules of Court, rule 8.495.) Fresno contends that in denying reconsideration and adopting the decision of a workers' compensation administrative law judge (WCJ), the WCAB exceeded its authority by effectively applying a cost of living adjustment (COLA) formula set forth in a Court of Appeal opinion that had already been granted review by the Supreme Court. (Duncan v. Workers' Comp. Appeals Bd. (X.S.)(Nov. 25, 2009, H034040) review granted Mar. 24, 2010, S0179194 (Duncan).)While the WCAB applied a somewhat different analysis here, the Supreme Court has since clarified that neither application of the COLA is correct. (Baker v. Workers' Comp. Appeals Bd. (X.S.)(Aug. 11, 2011) ___ S.Ct. ___[11 Cal. Daily Op. Serv. 10,194, 2011 Daily Journal D.A.R. 12,115, 2011 Cal. Lexis 8085] (Baker), sub nom. Duncan.)Given the recent clarification of law in existence at the time of the worker's injury, we will remand the matter to the WCAB to make the necessary findings and calculations.
References to Fresno include its workers' compensation adjuster, York Insurance Services.
Further statutory references are to the Labor Code unless otherwise indicated.
BACKGROUND
Patrick O'Brien was employed by Fresno as a deputy sheriff when, on April 25, 2003, he was struck by a drunk driver and ejected from his vehicle. O'Brien underwent multiple surgeries to treat his various injuries that included head fractures, brain hemorrhages, a fractured pelvis, and comminuted fractures of both lower extremities. Upon release from the hospital in June 2003, O'Brien continued treatment through September 2003 at San Joaquin Valley Rehabilitation Hospital and Outpatient Center, where his treating physician opined he was totally permanently disabled.
A workers' compensation hearing was held on March 16, 2010, to determine O'Brien's level of permanent disability, attorney fees, the applicable rating schedule, and the appropriate COLA calculations under section 4659, subdivision (c). The minutes of the hearing indicate the parties stipulated that O'Brien became permanent and stationary on April 26, 2008, and that he received his regular salary under section 4850 from April 26, 2003, through May 20, 2004, temporary disability benefits of $771 per week from April 26, 2003, through April 26, 2008, and permanent disability payments of $230 per week beginning on April 26, 2008.
The WCJ issued a Findings of Fact, Award, and Order on April 8, 2010, concluding the 1997 permanent disability rating schedule applied, that O'Brien was 100 percent permanently disabled, and that he was entitled to COLA's "beginning on 1/1/04 and continuing each January 1 thereafter." In awarding 12-percent attorney fees, the WCJ relied on the Division of Workers' Compensation Disability Evaluation Unit (DEU) calculations that the present value of O'Brien's award amounted to $1,515,395.28. Although not mentioned in the WCJ's opinion, the attached DEU calculation worksheet acknowledged that, "This calculation utilizes the approach set forth in Duncan v. WCAB (H034040) which has the effect of increasing the commuted value of benefits: This calculation will be invalid unless benefits are paid to applicant in a manner consistent with this decision."
Fresno petitioned the WCAB for reconsideration, arguing the WCJ erred in basing its COLA calculations on the Duncan decision because it had been granted review by the Supreme Court 15 days earlier on March 24, 2010. In a Report and Recommendation to the WCAB, the WCJ explained he "did not cite or rely on the Duncan case in rendering [the] decision in this matter" and instead applied his own interpretation of section 4659, subdivision (c) as it related to O'Brien's case. On June 30, 2010, the WCAB denied reconsideration, adopting and incorporating the WCJ's reasoning as its own.
Because O'Brien's injury occurred in 2003, however, the resulting calculation was the same as under Duncan.
DISCUSSION
As our Supreme Court recently summarized, "Total permanent disability benefits are weekly payments made for life to injured workers who are 100 percent disabled. (§ 4659, subd. (b).) They commence on the date the injured worker reaches a medically stable condition (permanent and stationary) because, at that point, the full nature and extent of the worker's permanent disability, if any, can be determined." (Baker, slip opn. at p. 2, citing Department of Rehabilitation v. Workers' Comp. Appeals Bd. (2003) 30 Cal.4th 1281, 1292 (Department of Rehabilitation).)
Enacted under Assembly Bill No. 749 (Stats. 2002, ch. 6, pp. 91-95), section 4659, subdivision (c) establishes a COLA for injured employees receiving a life pension or total permanent disability award, providing in relevant part:
"For injuries occurring on or after January 1, 2003, an employee who becomes entitled to receive a life pension or total permanent disability indemnity as set forth in subdivisions (a) and (b) shall have that payment increased annually commencing on January 1, 2004, and each January 1 thereafter, by an amount equal to the percentage increase in the 'state average weekly wage' as compared to the prior year." (§ 4659, subd. (c).)
Acknowledging three potential methods of assessing the COLA, the Supreme Court in Baker considered:
"whether the operative language of subdivision (c) requires the annual COLA's for total permanent disability and life pension payments to be calculated (1) prospectively from the January 1 following the year in which the worker first becomes 'entitled to receive a life pension or total permanent disability indemnity' (§ 4659(c)), i.e., when the payments actually commence; (2) retroactively to January 1 following the year in which the worker sustains the industrial injury, the construction urged by real party in interest, or (3) retroactively to January 1, 2004, in every case
involving a qualifying industrial injury, regardless of the date of injury or the date the first benefit payment becomes due...." (Baker, slip opn. at pp. 2-3.)
Although for different reasons, both the Court of Appeal in Duncan and the WCAB in the present case calculated the COLA retroactively to January 1, 2004. Following the third formula described above, the Court of Appeal concluded the retroactive COLA was required under section 4659, subdivision (c) even though the injured worker was not injured until January 20, 2004, and did not become permanent and stationary until October 2006. (Duncan, supra, H034040.) In the present case, the WCAB effectively applied the second formula described above—or something close to it—by initiating the COLA on January 1, 2004, because O'Brien's injury occurred in 2003. In reviewing Duncan, however, the Supreme Court unanimously disagreed with either interpretation and instead applied the first formula summarized above, explaining:
"the Legislature intended that COLA's be calculated and applied prospectively commencing on the January 1 following the date on which the injured worker first becomes entitled to receive, and actually begins receiving, such benefit payments, i.e., the permanent and stationary date in the case of total permanent disability benefits, and the date on which partial permanent disability benefits become exhausted in the case of life pension payments." (Baker, slip opn. at p. 3.)
Although the WCAB here, in adopting the WCJ's Report and Recommendation, acknowledged substantial medical evidence supported a finding that O'Brien was 100 percent permanently disabled in 2003 as a basis for commencing the COLA in 2004, the parties' stipulated that O'Brien became permanent and stationary on April 26, 2008, when Fresno actually began making permanent disability payments. Because an injured worker is not entitled to permanent disability payments until he is deemed permanent and stationary (Department of Rehabilitation, supra, 30 Cal.4th at p. 1292), O'Brien's COLA should not have commenced until January 1, 2009.
A WCAB decision is not final until the appellate process has been exhausted. (See Marsh v. Workers' Comp. Appeals Bd. (2005) 130 Cal.App.4th 906.) Although Baker had not been decided when the WCAB issued its opinion in the present matter, it interprets the workers' compensation laws in existence at the time of O'Brien's 2003 injury. Under Baker, the WCAB's retroactive application of O'Brien's permanent disability COLA calculations under section 4659, subdivision (c) was incorrect as a matter of law based on the stipulated permanent and stationary date establishing his entitlement to his first permanent disability payment. Because the error is apparent on the face of the decision, certification of the record and further briefing would add nothing to the presentation already submitted. (See Goodenough v. Superior Court (1971) 18 Cal.App.3d 692, 697.)
This court has presumed the accuracy of the parties' stipulations listed in the WCJ's Minutes of Hearing and Summary of Evidence from the March 16, 2010 hearing, but acknowledges no express permanent and stationary date finding was made. Indeed, the WCJ opined in his Report and Recommendation to the WCAB that O'Brien was "'entitled'" to a 100 percent permanent disability award as early as 2003 based on the medical evidence. This court will leave to the WCAB to make the factual determination as to the sufficiency of the stipulation or to otherwise determine when O'Brien became permanent and stationary and entitled to permanent disability indemnity payments.
DISPOSITION
Let a writ of review issue forthwith. The WCAB's Order Denying Reconsideration, filed June 30, 2010, is annulled and the matter is remanded to the WCAB to reconsider its decision in light of Baker v. Workers' Comp. Appeals Bd. (X.S.), supra, ___ S.Ct. ___ [11 Cal. Daily Op. Serv. 10,194, 2011 Daily Journal D.A.R. 12,115, 2011 Cal. Lexis 8085].