Opinion
No. 5-098 / 04-0585
Filed April 28, 2005
Appeal from the Iowa District Court for Polk County, Arthur E. Gamble, Judge.
Respondent, Second Injury Fund, appeals from the district court's reversal of the agency's determination petitioner's injury did not qualify for fund benefits. REVERSED.
Thomas J. Miller, Attorney General, and Julie A. Burger, Assistant Attorney General, for appellant.
Michael R. Hoffmann of Hoffman Law Firm, Des Moines, for appellee.
Heard by Sackett, C.J., and Huitink and Vaitheswaran, JJ.
Defendant-appellant, the Second Injury Fund of Iowa (fund), appeals from the decision of the district court reversing the arbitration decision of the Iowa Worker's Compensation Commissioner (agency). The commissioner denied benefits to the claimant-appellee, David Evans. On appeal, the fund contends substantial evidence supports the agency decision and the district court erred in finding the agency's interpretation of Stumpff v. Second Injury Fund, 543 N.W.2d 904 (Iowa 1996) was unreasonably restrictive. We reverse the district court and affirm the agency decision.
Background facts and proceedings.
Evans suffered a work-related injury in 1977 which is not at issue in this appeal. In 1999 he was working with a grinding wheel which exploded, severing his thumb from his right hand at the proximal phalanx between the metacarpophalangeal (mcp) joint and the interphalangeal (ip) joint. The thumb was reattached and the treating physician rated the impairment at three percent impairment of range of motion and nine percent functional impairment of the mcp joint, resulting in a twelve percent functional impairment of the thumb. An independent medical examination by Dr. Wirtz considered the loss of motion and the loss of sensation, resulting in a twenty-five percent impairment of the thumb. Doctor Wirtz also found:
Summation of the thumb impairments for loss of motion at thirteen percent, and loss of feeling at twenty-five percent, results in a thirty-five percent impairment of the thumb, which relates to a fourteen percent impairment of the hand.
The fourteen percent impairment of the hand would relate to a thirteen percent impairment of the right upper extremity.
In denying benefits, the deputy workers' compensation commissioner concluded:
A finger has been held not to be a qualifying member for Second Injury Fund purposes. Stumpff v. Second Injury Fund, 543 N.W.2d 904, 907 (Iowa 1996). The court in Stumpff recognized that the loss of a finger or thumb does affect the hand but did not find merit in the argument that such would provide a basis for Fund liability where the statute expressly limited recovery to the hand. Id. at 906. However, the court did foreclose the commissioner from allowing recovery for a hand injury where the site of the injury is at the point where the bones of the finger connect to the bones of the hand. Id. at 907.
Dr. Wirtz concluded without elaboration that the claimant's thumb limitations affected the hand. Absent further elaboration this would appear to be the same type of consequential effects that were rejected by the court in Stumpff.
On appeal, the workers' compensation commissioner viewed the Stumpff decision as deviating from normal rules of statutory construction that give terms their ordinary meaning when the court concluded the term "hand" as used in Iowa Code section 85.64 (1989) considers a hand to be complete and fully functional even if it lacks fingers or a thumb. Stumpff, 543 N.W.2d at 904. The agency ruled:
Loss of use of a finger or the thumb clearly causes a loss of use of the hand. The Guides referenced in rule 876 IAC 4.2 consider loss of all fingers and thumb to constitute 100 percent loss of use of the hand. The court [in Stumpff] did not follow that line of logic, however, because it concluded that since the schedule of benefits in section 85.34 provides a measure for benefits when the loss is limited to a finger or thumb, that the term "hand" when used in the later-enacted section 85.64 means a member consisting of the palm without fingers or thumb rather than considering the fingers and thumb to be integral parts of the hand. That construction is binding on this agency.
A review of the records shows that the anatomical and physiological location of the damage from the September 3, 1999, injury is located exclusively in the claimant's thumb. Nothing clearly demonstrates that there is damage or derangement within the hand, including the hand side of the [mcp] joint, that causes loss of use of the hand. . . . The reason for the loss of range of motion at the [mcp] joint is not explained and could readily be attributed to the extensor tendon laceration or perhaps to damage to the proximal phalanx itself. Those parts of the injury are clearly contained within and limited to the thumb.
The agency affirmed the deputy's decision denying benefits.
On judicial review of the agency decision, the district court determined both that the agency findings were not supported by substantial evidence and that the agency's reading of Stumpff was "unduly restrictive" and affected by error of law. The court concluded the agency finding the "`injury is located exclusively in the claimant's thumb' is not supported by substantial evidence because it ignores the undisputed medical evidence of loss of use of the MCP joint." The court also concluded that the deputy's reading of Stumpff "is the direct opposite of what the Stumpff court said." Because the agency adopted the deputy's "unduly restrictive" interpretation of Stumpff, the court concluded the agency applied the wrong legal standard to the evidence. The court reversed the agency decision.
Claims on appeal.
On appeal, the fund contends (1) substantial evidence supports the agency decision the injury was limited to the thumb, and (2) the court erred in finding the agency's reading of Stumpff unreasonably restrictive. The claimant contends (1) he has a qualifying injury because it was at the mcp joint and the impairment affects essential hand functions including grip and pinch, and (2) Stumpff and other case law allow recovery where the injury was to the mcp joint and the impairment extends beyond the injury site into the hand as a whole.
Scope of review.
On judicial review of agency action, the district court functions in an appellate capacity, applying the standards of Iowa Code section 17A.19 (2001). Section 17A.19(10)(f) provides that, in a contested case, the court shall grant relief from an agency decision if substantial rights of a person have been prejudiced because agency action is unsupported by substantial evidence in the record made before the agency when the record is viewed as a whole. We apply the standards of section 17A.19 to the agency action and determine whether our conclusions are consistent with those of the district court. Brown v. Quik Trip Corp., 641 N.W.2d 725, 727 (Iowa 2002).
Discussion. Legal error in the application of Stumpff.
In Stumpff, the claimant suffered a severe "fracture distal one-third proximal phalanx right index finger" and received benefits for a seventy-three percent loss to his index finger. Stumpff, 543 N.W.2d at 905. The treating physician found "the permanent physical impairment of the index finger is equal to seventy-three percent of that digit, which in turn is equal to eighteen percent of the hand." Id. at 906. Following fractures to his wrists thirteen years later, he sought benefits from the fund. Id. at 905. The deputy found no disability to the hand from the injury to the finger. Id. That decision was affirmed by the agency, the district court, and the supreme court. Id. The supreme court stated:
The Iowa legislature chose to allow a hand injury to qualify as a first injury against the Fund but not allow an injury to a finger to qualify. See Harry W. Dahl, The Iowa Second Injury Fund — Time for Change, 39 Drake L. Rev. 101, 119 (1989-1990) ("The first loss must be to one scheduled part named in the Iowa Act, that is, one arm, one hand, one foot, one leg, or one eye."). We think the industrial commissioner has correctly allowed recovery for a hand injury when the site of the injury is at the point where the bones of the finger connect to the bones of the hand (phalangeal-metacarpal joint), Vogel v. Second Injury Fund, File No. 925720, p. 2 (App. Decision April 30, 1993), and also has correctly denied benefits where only the finger was injured, Clester v. Second Injury Fund, File No. 990938, p. 3 (Arb. Decision February 2, 1994). This interpretation is consistent with the clear language of the statute and our prior cases. In the recent case of Second Injury Fund v. Nelson, 544 N.W.2d 258 (Iowa 1995) [as amended on denial of rehearing (1996)], the claimant suffered a nonscheduled shoulder injury. He suggested the injury to his shoulder was also an injury to his arm. We rejected the suggestion that a shoulder injury that affects the arm is sufficient to make the Fund liable. Nelson, 544 N.W.2d at 269-70. Likewise, we reject Stumpff's argument that the injury to his finger should be treated as a loss or loss of use of his hand thus qualifying as a first injury for the purpose of Fund liability.
Stumpff, 543 N.W.2d at 906-07.
In the case sub judice, the agency considered the loss of flexion of the mcp joint, but concluded it was not material because of the supreme court's construction of "hand" in Stumpff:
The reason for the loss of range of motion at the [mcp] joint is not explained and could readily be attributed to the extensor tendon laceration or perhaps damage to the proximal phalanx itself. Those parts of the injury are clearly contained within and limited to the thumb. Since virtually the entire function of the hand is provided by the fingers and thumb, it is obvious that this injury caused loss of use [of] the hand. That fact is not material, however, given the construction of the term "hand" the court adopted.
Iowa Code section 85.34 contains the list of scheduled injuries, including, inter alia, the thumb, individual fingers, and hand. Iowa Code § 85.34(2)(a) (thumb), (b-e) (fingers), and ( l) (hand) (Supp. 1996). In Stumpff, the court reasoned that the legislature chose to allow only injuries to certain scheduled members to qualify as injuries which could subject the fund to liability. Stumpff, 543 N.W.2d at 906-07; see Iowa Code § 85.64. Because Stumpff's injury was not to one of the members qualifying under section 85.64, he was not entitled to fund benefits. The same result is appropriate in this case.
Substantial evidence to support agency findings.
The agency's findings are binding if supported by substantial evidence when the record is viewed as a whole. Sierra v. Employment Appeal Bd., 508 N.W.2d 719, 720 (Iowa 1993). If there is conflict in the evidence or reasonable minds might disagree, deference is given to the agency's findings. Aluminum Co. v. Employment Appeal Bd., 449 N.W.2d 391, 394 (Iowa 1989). The question is not whether the evidence supports a different finding, but whether the evidence supports the findings actually made. Munson v. Iowa Dep't of Transp., 513 N.W.2d 722, 723 (Iowa 1994).
The district court concluded the agencies findings which ignored uncontroverted evidence were unsupported by substantial evidence. The parties agree the initial accidental amputation of claimant's thumb occurred in the thumb, not the hand or the mcp joint. "The commissioner is free to accept or reject, in whole or in part, expert testimony even if uncontroverted." Dunlavey v. Economy Fire and Cas. Co., 526 N.W.2d 845, 853 (Iowa 1995) (citing Sondag v. Ferris Hardware, 220 N.W.2d 903, 907 (Iowa 1974)). The agency has the obligation to state the reasons for disregarding uncontroverted medical causation testimony. Sondag, 220 N.W.2d at 908; see Langford v. Kellar Excavating Grading, Inc., 191 N.W.2d 667, 669 (Iowa 1971). In the case sub judice, the agency considered the uncontradicted opinions but gave reasons for rejecting them. The physical injury was to the thumb, even though an injury to the thumb or a finger affects the hand. Although a physical injury to the thumb or a finger may affect the use of the hand that does not mean the injury is to the hand, qualifying for second injury fund benefits. See Stumpff, 543 N.W.2d at 906-07. A thumb or finger is not among the injuries qualifying for second injury fund benefits. See Iowa Code § 86.64. The district court substituted its fact findings for those of the agency. We conclude the agency's findings were supported by substantial evidence in the record. Consequently, we reverse the decision of the district court allowing second injury fund benefits and affirm the agency decision denying those benefits.