Opinion
CLAIM NO. E812508
ORDER FILED APRIL 21, 2000
Upon review before the FULL COMMISSION in Little Rock, Pulaski County, Arkansas.
Claimant represented by the HONORABLE BILLY J. HUBBELL, Attorney at Law, Crossett, Arkansas.
Respondent represented by the HONORABLE BRIAN H. RATCLIFF, Attorney at Law, El Dorado, Arkansas.
Decision of the Administrative Law Judge: Affirmed in part and reversed in part.
OPINION AND ORDER
The claimant appeals an opinion and order filed by the administrative law judge on June 16, 1999. In that opinion and order, the administrative law judge found that the claimant failed to prove that he is entitled to any temporary disability compensation after June 30, 1998, and that the preponderance of the evidence fails to establish that the respondents controverted any paid or unpaid benefits which were a part of this claim. After conducting a de novo review of the entire record, we find that the clamant failed to establish by a preponderance of the evidence that he is entitled to any additional temporary disability benefits after June 30, 1998. Therefore, we find that the administrative law judge's decision in this regard must be affirmed. In addition, we find that, based on the procedural history of this case, the respondents did controvert the 1997 medical payments and the claimant's prior temporary disability payments which were eventually paid prior to the hearing, but only after extraordinary delay. Therefore, we find that the administrative law judge's decision in this regard must be reversed. In addition, we are referring the respondent-employer and the respondent-carrier to the Commission's Compliance Division for investigation.
Chronological History
The claimant was operating a weedeater at work on May 30, 1997 when flying debris cut his leg. The claimant testified that he reported the injury and finished the job. [T. 18] The injury did not heal within a day or two, and according to the claimant, the owner, Max Halley, was called and informed. Mr. Halley suggested that the claimant see Dr. Thompson in Crossett. [T. 19]
The claimant testified that he went to Dr. Thompson who determined that the ankle wound had developed an ulcer. The claimant was later referred to Dr. Jucas in El Dorado and later to Dr. Menendez. Dr. Menendez performed a full thickness debridement and applied a porcine graft on top of the ulcer on August 11, 1997 [C. Ex. P. 33]. This procedure was unsuccessful, and Dr. Menendez performed another debridement with a full thickness skin graft on August 22, 1997. [C. Ex. P. 83]. The claimant was discharged from the hospital on August 27, 1997 or August 28, 1997. [C. Ex. P. 162 and P. 77].
The claimant's medical records indicate that the claimant's next appointment with Dr. Menendez was scheduled for September 2, 1997 [C. Ex. P. 162], and the claimant testified that he last saw Dr. Menendez (prior to 1999) in December of 1997. [T. 21] The claimant testified that he determined that his medical supplies weren't being paid, and he determined that his hospital bills were never paid, so he stopped seeing Dr. Menendez in December of 1997. [T. 21-22].
The parties stipulated at the start of the hearing that the claimant was temporarily totally disabled during the following periods: August 11, 1997 — August 17, 1997; September 8, 1997 — September 14, 1997; September 29, 1997 — October 5, 1997; October 28, 1997 — November 28, 1997. The parties also stipulated that the claimant went back to work for the respondent from December 1, 1997 — June 30, 1998, when the claimant apparently turned in a resignation letter.
The parties have not offered into evidence any medical records for any treatment that the claimant may have received from Dr. Menendez or any other physician after his hospital discharge in August of 1997.
Kristie Hovey, who was a claims adjustor for the respondent carrier at one time, testified that the respondent carrier first received "the first report of notification" on February 4, 1998 when it received a Form N (not in the record) signed by the claimant on January 23, 1998. [R. Ex. 1 p. 6]. Ms. Hovey testified that the claim was accepted as compensable on June 5, 1998 (i.e., 4 months later) [R. Ex. 1 P. 7]. Apparently, the claim was accepted as a "medical only" claim, and no form was filed by the carrier with the Commission at that time (on the basis that the Commission would not require a filing for a medical only claim). [Id.]
The respondent carrier forwarded the claimant's medical expenses to National Comp Care for adjustment to the workers' compensation fee schedule on October 9, 1998 (4 months after the injury was accepted as a "medical only" claim). [R. Ex. 1 P. 8]. The record is not clear when National Comp Care completed its "adjustment", although checks for medical payments apparently began clearing in November of 1998. [R. Ex. 3]
On the advise of counsel, the carrier filed a Form 2, as a medical only claim, on October 14, 1998, in order to get a Commission claim number to try to consider a joint petition settlement. [R. Ex. 1 P. 8]
Ms. Hovey testified that the claimant filed a Form N (not in the record) with the Commission on November 2, 1998, and that the respondents received "the letter" (not in the record) on November 4, 1998. [R. Ex. 1 P. 11] Ms. Hover testified that she responded to Ms. Gray (Faydeane Gray) on November 16, 1998, and carbon copied the claimant's attorney. According to Ms. Hover's testimony and according to an amended Form 2 dated November 16, 1998 in the record, the respondents had determined that the claim was no longer a medical only claim, and the respondents indicated on their amended Form 2 that the claimant was entitled to temporary total disability for the periods indicated above. [R. Ex. 1 P. 11 and R. Ex. 2]. Ms. Hover's November 16, 1998 letter to Ms. Gray stated that "all temporary total disability had been paid". [R. Ex. 1 P. 12 and R. Ex. 4].
The claimant testified that he ultimately returned to a doctor (presumably Dr. Menendez) in 1999. The record is not clear whether the respondents have authorized this additional treatment, and that issue is not presently before us.
Issue 1: Additional Temporary Partial Disability After June 30, 1998
Since the claimant's injury occurred after July 1, 1993, the provisions of Act 796 of 1993 are applicable to this claim. However, Act 796 did not change the basic law regarding temporary total disability compensation. In this regard, temporary disability is determined by the extent to which a compensable injury has affected the claimant's ability to earn a livelihood. An injured employee is entitled to temporary total disability compensation during the period of time that he is within his healing period and totally incapacitated to earn wages. Arkansas State Highway and Transportation Department v. Breshears, 272 Ark. 244, 613 S.W.2d 392 (1981). An injured employee is entitled to temporary partial disability compensation during the period that he is within his healing period and suffers only a decrease in his capacity to earn the wages that he was receiving at the time of the injury. Id. The "healing period" is defined as the period necessary for the healing of an injury resulting from an accident. Ark. Code Ann. § 11-9-102(13) (Repl. 1996). The healing period continues until the employee is as far restored as the permanent character of his injury will permit. When the underlying condition causing the disability becomes stable and when nothing further will improve that condition, the healing period has ended, and the claimant is no longer entitled to receive temporary total disability compensation or temporary partial disability compensation, regardless of his physical capabilities. Moreover, the persistence of pain is not sufficient in itself to extend the healing period or to find that the claimant is totally incapacitated from earning wages. Mad Butcher, Inc. v. Parker, 4 Ark. App. 124, 628 S.W.2d 582 (1982).
In the present case, we find that the claimant has failed to establish that he was within his healing period or incapacitated to earn at any point after June 30, 1998. As to the claimant's healing period, the claimant testified that his leg never healed in 1998, that his leg still has not healed as of the date of the hearing, and that he went back to the doctor in early 1999. [T. 22, 23] However, as discussed above, the claimant has failed to offer into evidence any reports from any physician after the claimant's hospital discharge in August of 1997, to indicate what additional treatment, if any, that the claimant ever received between August of 1997 and April of 1999. The claimant has the burden of proof, and under these circumstances, we find that he has failed to establish that his healing period extended beyond June 30, 1998.
As to the claimant's capacity or incapacity to continue working after June 30, 1998, the claimant testified that he could no longer work under restrictions imposed by his physician (not in the record) [T. 24] The claimant also testified that he resigned in June of 1998 because his leg wound kept opening up and was very painful. [T. 23] However, in assessing this testimony, we note that the claimant had worked without any disruption from his injury from December of 1997 through June of 1998, and we note that the claimant acknowledged on cross-examination that he had told Mr. Halley that, two weeks before he resigned, he had developed a problem with the use of his right arm and leg. [T. 36] The claimant also acknowledged that he has continued his other job as a crossing guard working 30 minutes in the morning and 30 minutes in the evening after resigning from the respondent in June of 1998 [T. 26], and the claimant has acknowledged that he has not looked for any work to replace his income with the respondent. [T. 37] Under these circumstances, we find that the claimant has also failed to prove by a preponderance of the evidence in the record that he was in fact incapacitated from continuing to work his job with the respondents after June 30, 1998.
Issue 2: Controversion, Controverted Attorney Fee, And Referral To The Compliance Division
The Arkansas Workers' Compensation Law specifically provides that the Commission shall direct that a fee be paid to the claimant's attorney "whenever the Commission finds that a claim has been controverted, in whole or part. . . ." Ark. Code Ann. § 11-9-715 (a) (2) (Supp. 1996) (previously codified at Ark. Stat. Ann. § 81-1332 (Cumm. Supp. 1985)); see, also, Tyson Foods, Inc. v. Fatherree, 16 Ark. App. 41, 696 S.W.2d 782 (1985). Making respondents liable for at least a portion of the attorney's fees serves the legitimate social purposes of discouraging oppressive delays in recognition of liability, deterring arbitrary and capricious denials of claims, and insuring the ability of a necessitous employee to obtain adequate legal representation.See, Aluminum Company of America v. Henning, 260 Ark. 699, 543 S.W.2d 480 (1976). Thus, the purpose of determining whether or not a claim has been controverted, and by whom, "is to place the burden of litigation expense upon the party; which made it necessary." Henning, supra; Buckner v. Sparks Regional Medical Center, 32 Ark. App. 5, 794 S.W.2d 6223 [ 794 S.W.2d 623] (1990). Consequently, whether a claim is controverted must be determined from the circumstances of each particular case. Buckner, supra, Masonite Corporation v. Mitchell, 16 Ark. App. 209, 699 S.W.2d 409 (1985);Climer v. Drake's Backhoe, 7 Ark. App. 148, 644 S.W.2d 637 (1983). The mere failure to pay compensation benefits does not amount to controversion, in and of itself. Revere Copper Brass, Inc. v. Talley, 7 Ark. App. 234, 647 S.W.2d 477 (1983). Likewise, controversion may not be found where the respondent accepts its compensability but delays payment in a reasonable attempt to investigate the extent of the disability. Horseshoe Bend v. Sosa, 259 Ark. 267, 532 S.W.2d 182 (1976); Hamrick v. The Colson Company, 271 Ark. 740, 610 S.W.2d 281 (1981). However, assuming a position which requires an injured employee to retain an attorney to take the actions necessary to assure that the employee's rights are protected may constitute controversion. New Hampshire Insurance Co. v. Logan, 13 Ark. App. 116, 680 S.W.2d 720 (1984); Turner v. Trade Winds Inn, 267 Ark. 861, 592 S.W.2d 454 (1980); Buckner, supra.
Employer's Actions
Ms. Hovey's testimony, discussed above, indicates that the respondent carrier first learned of the May 30, 1997 injury by a Form N received by the carrier on February 4, 1998. However, the claimant's testimony discussed above indicates that the company owner, Mr. Halley, was promptly advised of the claimant's injury and that Mr. Halley, in fact, indicated to the claimant which doctor to go to in May or June of 1997. In the intervening period between May of 1997 and February of 1998, the claimant underwent at least 2 surgical procedures, and, according to Ms. Hovey's testimony, the employer's wage records also indicated the periods of temporary total disability stipulated to at the hearing. Under these circumstances, the record indicates that the employer knew, or should have known, that the claimant had a work-related injury causing lost time from work and surgical intervention, which the employer did not timely report to the employer's insurance carrier. This conclusion is not only supported by the testimony of the claimant and of Ms. Hovey, but also by three documents in the medical record dated August 1, 1997, August 13, 1997, and August 28, 1997, which each indicate that the claimant is a workers' compensation patient, each indicate the claimant's date of injury, each identify Halley Oil Company, and each indicate a specific contract number (C. Ex. P. 23, 28, and 77). We refer the respondent employer to the Compliance Division for investigation of its actions and inaction related to this injury. On this record, we also find that the preponderance of the record establishes that the employer controverted the claimant's entitlement to benefits by failing or refusing for eight months after the injury to take action to notify the carrier in order to provide the claimant benefits due to the claimant.
Carrier's Actions
If the carrier had immediately investigated the employer's wage records when the carrier purportedly first learned of the injury by a Form N received on February 4, 1998, the carrier would have determined that the claimant sustained a lost-time injury, entitling the claimant to accrued disability benefits in addition to medical expense payment. However, in this case, the carrier admittedly did not investigate to determine that a lost time injury had occurred. The carrier also admittedly delayed an additional 4 months (until June of 1998) in advising the claimant whether the carrier would accept his injury as compensable, and then delayed yet another 4 months (until October of 1998) to send the claimant's 1997 medical expenses off for "adjustment". According to Ms. Hovey, the carrier did not investigate the employer's wage records to determine the claimant's entitlement to temporary total disability for 1997 until sometime after the AR-2 (medical only) form was sent to the Commission on October 14, 1998 (8 months after receiving the claimant's Form N) but before an amended Form 2 (lost time from work acknowledged) was filed on November 16, 1998, which also happened to be two weeks after the claimant purportedly filed a Form N with the Commission on November 2, 1998.
The respondent carrier has not in any way explained (1) what initial investigation, if any, that the carrier performed after receiving notice of the claimant's injury in February of 1998, (2) why the carrier then took four months to accept the injury as compensable, (3) why the carrier took a total of eight months to send the claimant's prior medical expenses for "adjustment" and later payment, or (4) why the carrier took a total of eight to nine months to investigate and determine that the claimant actually had a lost-time injury which required payment of accrued temporary disability compensation.
We are particularly disturbed by the fact that, if the carrier had performed any investigation of the respondents' wage records initially, and had learned, as it would have, that the claimant had a lost-time injury, and not simply a "medical only" claim, that knowledge would have (1) required the carrier to immediately report the claimant's lost-time injury to the Commission (2) caused the carrier to receive a letter from the Commission (3) caused the carrier to perform a timely investigation within 15 days and to make a timely decision on accepting or denying compensability, and (4) required a much more timely payment of accrued temporary total disability, if the carrier determined to accept compensability, as it purportedly did four months after notice of the injury in this case. See, Ark. Code Ann. § 11-9-529; Workers' Compensation — First Report of Injury or Illness Form 1A-1, page 2; Ark. Code Ann. § 11-9-803 (a)(1); Workers' Compensation Form AR-2, page 2.
Even with regard to a "medical only" claim, the respondents had a duty to either accept the claim, controvert the claim, or seek an extension of time from the Commission for further investigation. The Arkansas Workers' Compensation Law is specific as to the procedures for the employer or carrier to obtain an extension of time for making payment of the first installment of compensation or, in the alternative, of controverting the claim.See, Ark. Code Ann. § 11-9-803 (b). We see nothing in the record of the present case to suggest that any good faith or diligent effort was ever made in this case to investigate or report this claimant's injury in a timely manner, or to obtain an extension of time from the Commission as permitted under Section 803(b). Under these circumstances, we are referring the respondent carrier for investigation by the Compliance Division, and we find that the carrier did, in fact, controvert the claimant's entitlement to benefits through its unexplained and dilatory delay in investigating and accepting the claimant's injury as compensable, before finally paying benefits. Compare, Shettler v. Jackson Hewitt Tax Services, Full Workers' Compensation Commission, Op. Filed Nov. 12, 1997 ( E606013).
As to whether the claimant's attorney should receive a fee for services related to the respondent's controversion, our determination is somewhat frustrated by the lack of evidence indicating exactly when the claimant consulted his attorney, Billy Hubbell. However, we do know from the record that attorney Hubbell filed the claimant's November 2, 1998 Form N [See R. Ex. 4], and the respondents did not acknowledge liability for the claimant's temporary total disability from any evidence in the record until the carrier filed an amended Form 2 on November 16, 1998 (i.e., not until after the claimant had hired an attorney and filed a Form N with the Commission on November 2, 1998.). Under these circumstances, where the respondents did not accept liability for the claimant's 1997 temporary total disability until after the claimant hired an attorney and filed a Form N, we find that the preponderance of the evidence, when considered in light of all of the respondents' other unexplained delays, indicates that the claimant was required to hire an attorney in order to get paid his 1997 temporary total disability benefits. On that basis, we award the claimant's attorney the maximum controverted attorney fee on the stipulated 1997 temporary total disability of $1,440.00.
We also award the claimant's attorney the maximum attorney's fee on the claimant's $9,896.00 in 1997 medical expenses. In reaching this conclusion, we are aware that the respondents filed a Form 2 on October 14, 1998 [i.e., before the claimant's November 2, 1998 Form N], which purportedly accepted the injury as compensable as a medical only claim. This, by itself, would suggest the respondents intended to pay the claimant's medical expenses before the claimant filed his Form N on November 2, 1998. However, in the present case, we find it very significant that Ms. Hovey testified that she filed this Form 2 (as a medical only claim), after consultation with the respondents' attorney, for the purpose of getting a Commission claim number to try to consider a joint petition settlement. This testimony indicates that the respondents did not file the From 2 as an admission of liability for any particular medical expense, but only as a prerequisite to settlement negotiations. In light of the respondents unexplained delays discussed above, and in light of the lack of evidence that the respondents otherwise ever specifically accepted liability for the claimant's medical treatment prior to the claimant filing his Form N on November 2, 1998, we find that the preponderance of the evidence in this case indicates that the claimant was forced to hire an attorney in order to get his medical expenses paid.
Therefore, after conducting a de novo review of the entire record, and for the reasons discussed herein, we find that the claimant failed to prove by a preponderance of the evidence that he is entitled to additional temporary disability compensation for any period after June 30, 1998. Therefore, we find that the administrative law judge's decision in this regard must be affirmed. However, we find that the claimant's attorney is entitled to the maximum statutory attorney's fee on the claimant's temporary total disability compensation for 1997, and for the claimant's medical expenses.
All accrued benefits shall be paid in a lump sum without discount and with interest thereon at the lawful rate from the date of the administrative law judge's decision in accordance with Ark. Code Ann. § 11-9-809 (Repl. 1996). For prevailing in part on this appeal before the Full Commission, claimant's attorney is hereby awarded an additional attorney's fee in the amount of $250.00 in accordance with Ark. Code Ann. § 11-9-715 (Repl. 1996).
IT IS SO ORDERED.
___________________________
MIKE WILSON, Commissioner
CONCURRING AND DISSENTING OPINION
I concur in part and respectfully dissent in part from the majority opinion in this case. I concur in the finding with respect to controversion. Moreover, I am of the opinion that it is appropriate to refer respondent employer and respondent carrier to the Compliance Division for investigation. However, I cannot agree that claimant failed to prove entitlement to additional indemnity benefits. In my view, claimant has met his burden of proof. I would award additional indemnity benefits in accordance with claimant's request.
Based on the foregoing, I concur in part and respectfully dissent in part.
________________________________ PAT WEST HUMPHREY, COMMISSIONER