Opinion
No. 2-084 / 01-0963
Filed August 28, 2002
Appeal from the Iowa District Court for Polk County, Larry J. Eisenhauer, Judge.
The employer appeals an award of worker's compensation benefits to an employee, raising issues of causation, disability, penalty benefits and interest.
AFFIRMED IN PART AND REVERSED IN PART.
Stephen Spencer and Joseph Barron, of Peddicord, Wharton, Spencer Hook, P.C., Des Moines, for appellant.
R. Ronald Pogge, of Hopkins Huebner, P.C., Des Moines, for appellee.
Heard by Vogel, P.J., and Miller and Vaitheswaran, JJ. Eisenhauer, J., takes no part.
An employer seeks further judicial review of an agency decision awarding a claimant workers' compensation benefits in his review-reopening proceeding. The district court affirmed the agency. We affirm in part and reverse in part.
I. Background Facts and Proceedings
Rick Kemp worked for Mid-Seven Transportation as an over-the-road truck driver. He was injured in 1991 when he slipped on some ice while getting out of his cab and fell six to eight feet to the ground. Kemp underwent spine fusion surgery that included insertion of a metal rod along one portion of his spine. His surgeon was Dr. Boulden. Following the surgery, Kemp was referred to Dr. Blessman for pain management. Dr. Blessman advised him to meditate, relax, and exercise to keep his pain under control. Kemp returned to work as a dispatcher in 1993.
Two years after returning to work, Kemp reached a settlement with Mid-Seven concerning his 1991 injury. At the time of the settlement, Kemp still experienced pain but had learned to control it without narcotic medication. He continued to work as a dispatcher.
In 1996, Kemp began to experience more intense pain in his back, radiating into his left leg. Dr. Blessman prescribed narcotic medication which Kemp took on a regular basis.
Kemp stopped working for Mid-Seven in 1998. A year later, a third physician, Dr. Kip, examined a 1996 spinal film of Kemp's back and determined the implanted rod had broken.
Kemp filed a petition for review-reopening of the settlement agreement. Following a hearing, the deputy commissioner concluded a change of condition had occurred, justifying a reopening of the settlement agreement and further concluded Kemp was permanently and totally disabled. The deputy awarded Kemp penalty benefits. This decision was affirmed on intra-agency review.
On judicial review, the district court affirmed the substance of the agency decision. Additionally, the court awarded interest of $1540.44 on the penalty benefits. The employer now seeks further judicial review.
Mid-Seven contends (1) Kemp suffered no change in condition justifying the award of benefits, (2) the determination that Kemp was permanently and totally disabled was unsupported by substantial evidence, (3) the agency should not have awarded penalty benefits; and (4) the district court should not have awarded interest on the penalty benefits. Our standards of review are set forth in Iowa Code section 17A.19(8) (1997).
II. Change of Condition
The claimant in a review-reopening proceeding must show that a change of condition has occurred since the original award. See Iowa Code § 86.14; Williamson v. Fansteel, 595 N.W.2d 803, 805 (Iowa 1999). The condition must not have been contemplated at the time of the settlement. E.N.T. Assocs. v. Collentine, 525 N.W.2d 827, 830 (Iowa 1994).
Mid-Seven contends Kemp could not show a change of condition because (1) there was no evidence to tie the broken rod to his current symptoms and (2) Kemp was warned of the risk of rod breakage when he underwent fusion surgery, placing the injury within his contemplation at the time of the settlement agreement.
The deputy commissioner addressed the question of whether there was evidence to tie Kemp's post-1996 symptoms to the broken rod, stating:
[T]he broken rod itself is a change of condition not contemplated by the parties at the time of the settlement. It is obvious from the medical records that the broken rod coincides with claimant's increased symptoms and additional medical treatment. Although the additional medical treatment would be contemplated under the agreement for settlement, the increased symptoms due to the broken rod would not have been anticipated. As a result, it is found that claimant has sustained his burden of proof by showing by a preponderance of the evidence that he has a change of condition since the agreement for settlement was approved in October, 1995.
The record contains substantial evidence to support this determination. Dr. Blessman opined that he sensed Kemp's pain level was greater in October 1996 than when Kemp was released from the pain management center in 1994. Dr. Boulden noted in late September 1996 that Kemp continued "to have more and more symptoms with the symptoms getting more sharp and more bothersome." Kemp testified that, although he experienced continuous pain after the 1991 injury, the intensity and location of the pain changed in late 1996 and he was forced to resume treatment with narcotic drugs after a fourteen month hiatus.
As for the employer's second contention that Kemp was warned of the rod breakage before the settlement was finalized, the record reveals Kemp was warned the rods could break if the surgery failed and a "nonunion" occurred. However, Dr. Boulder opined after the surgery that the fusion was "well-healed." Even in October 1996, when Kemp began experiencing more pain, Dr. Boulden opined that he had "a good solid fusion."
We agree with Mid-Seven that there is evidence from which one could draw a contrary inference concerning whether there was a change in Kemp's condition. However, we are not charged with drawing such inferences. It is the commissioner as trier of fact who has the duty to determine the credibility of the witnesses and to weigh the evidence. IBP, Inc. v. Harpole, 621 N.W.2d 410, 420 (Iowa 2001). The commissioner did so and we affirm.
III. Permanent and Total Disability
Mid-Seven next takes issue with the deputy commissioner's determination that Kemp was permanently and totally disabled. The employer points out that Kemp quit on his own, without a physician's recommendation. Mid-Seven also stresses Dr. Boulden's opinion that Kemp could still perform his job as a dispatcher. There is, however, substantial evidence supporting the deputy commissioner's contrary determination. That evidence, summarized in the deputy's decision, includes Dr. Blessman's opinion that Kemp could not return to work despite his previously exhibited strong work ethic. Having found substantial evidentiary support for the agency's determination on this question, our standard of review requires us to affirm the determination. Harpole, 621 N.W.2d at 419.
IV. Penalty Benefits
The deputy commissioner awarded penalty benefits of fifty percent on those benefits owed from September 14, 1998 through March 1, 2000. Mid-Seven takes issue with this award.
Iowa Code section 86.13 authorizes penalty benefits if an employer delays the commencement or termination of benefits "without reasonable or probable cause or excuse." Iowa Code § 86.13. In the absence of a reasonable excuse for a delay, penalty benefits are mandatory. Christensen v. Snap-On Tools Corp., 554 N.W.2d 254, 261 (Iowa 1996). The reason for a delay in payment must be conveyed to the employee contemporaneously with the delay. Meyers v. Holiday Express Corp., 557 N.W.2d 502, 505 (Iowa 1996) (reaffirming that if no reason is given for the delay, court will hold no cause or excuse exists).
Several months before Kemp quit, Kemp's attorney informed Mid-Seven's insurer that Kemp was again seeing Dr. Blessman, might not be able to continue working, and wished to receive immediate compensation in order to toll the statute of limitation for filing a review-reopening claim. That letter, together with the review-reopening petition filed within a week of Kemp's quitting and a letter from Dr. Blessman characterizing Kemp's pain as disabling, placed the employer on notice of the nature of Kemp's injury and his intent to reopen the settlement. The employer declined to reinitiate benefit payments and did not provide any reason or excuse for refusing to do so. We believe penalty benefits are mandatory under these circumstances. See Meyers, 557 N.W.2d at 505.
The insurer responded to the attorney's letter by stating it was not interested in making additional indemnity payments to extend the statute of limitations.
V. Interest on Penalty Benefits
Mid-Seven finally takes issue with the district court's award of interest on the penalty benefits on the ground that (1) the agency did not award such interest and (2) interest on penalties is not authorized. We need not decide whether interest on penalty payments is authorized because we conclude the district court exceeded the scope of its review in ordering the payment.
A district court on judicial review of agency action functions only in an appellate capacity. Iowans for Tax Relief v. Campaign Fin. Disclosure Comm'n, 331 N.W.2d 862, 863-64 (Iowa 1983). It has no original authority to declare the rights of parties. Id.; Public Employment Relations Bd. v. Stohr, 279 N.W.2d 286, 290 (Iowa 1979).
Kemp did not seek an expansion of the agency decision to include interest on the penalty benefits. As the issue of interest on the penalty award was not raised or litigated before the agency and was not a part of the agency record for review, the district court was precluded from sua sponte awarding this payment. See Grundle v. Iowa Dep't. of Revenue, 450 N.W.2d 845, 847 (Iowa 1990); Meads v. Iowa Dep't. of Social Servs., 366 N.W.2d 555, 559 (Iowa 1985). ("the district court may only review issues considered and decided by the agency.") Accord Fort Dodge Sec. Police, Inc. v. Iowa Dep't. of Revenue, 414 N.W.2d 666, 670 (Iowa Ct.App. 1987) (noting three issues raised in petition for judicial review "were not raised, preserved or appealed below before the department," precluding consideration by the district court); Iowa Electric Light Power Co. v. Iowa State Commerce Comm'n, 386 N.W.2d 132, 133 (Iowa Ct.App. 1986). Accordingly, we reverse the district court's award of interest on the penalty benefits.
AFFIRMED IN PART AND REVERSED IN PART.