To Advance or Not to Advance: The New PD Problem
Every once in a while something crosses your desk on a file that you are not handling which catches your eye.
While reviewing some mail on an old file which we were no longer involved in, I received an Opinion and Order Granting Petition for Reconsideration and Decision after Reconsideration. This involved three cases in Bakersfield between an applicant named Dunehew and two insurance companies covering three separate injuries (ADJ4045682, ADJ2806318, ADJ6769921).
The applicant apparently had a cumulative trauma claim through August 16, 2000. A second cumulative trauma claim through June 30, 2007 and a specific injury occurring on March 31, 2003.
These cases went to Trial and ultimately the Court found that the applicant had permanent disability and awarded permanent disability of $6,336.25 on the specific injury of March 31, 2003 and permanent disability of $4,830.00 on the cumulative injury through June 30, 2007. It appears that no money was awarded to the cumulative trauma claim through August 16, 2000. So far so good. However, the defendant apparently advanced all of the permanent disability on the March 31, 2003 totaling $11,477.40. The adjsuter wanted to try and take credit for the overpayment in the specific injury claim against the balance of the money due in the cumulative trauma claim. The WCAB denied that request for credit.
Cutting through the WCAB analysis, they relied on a couple of cases. They did point out that the defendants received a benefit in the change of law under the Benson. As you know, Benson allows for apportionment of permanent disability amongst each separate injury resulting in a smaller amount of permanent disability awarded than if the permanent disability from all three injuries were combined. Since defendants receive such a benefit due to Benson, defendants must now accept the detriment of potentially over advancing on a single case.
Also, they point out that the WCAB has jurisdiction to determine that where a credit might wipe out the applicant’s award, they have discretion as to whether or not to allow that. In this instance, they point that allowing the credit into the cumulative trauma claim through 2007 would result in the applicant not receiving any “new money” for his 2007 injury.
For these reasons, they denied the defendant’s request for shifting permanent disability monies from one claim to the other.
So what is the lesson to be learned from this decision? First, I would point out that you need to make sure that permanent disability advances are made in each individual case according to the facts in that case.
Secondly, I think you now have an argument to limit permanent disability advances substantially in situations where there are multiple dates of injury.
In other words, if the applicant has multiple dates of injury for the same body part, I think you could argue that permanent disability advances be delayed until clarification of apportionment between dates of injury if you can document genuine doubt from a legal perspective. The leading case regarding the proper interpretation and application of LC §5814 is Kerley v. Workmen’s Comp. App. Bd. (1971) 4 Cal.3d 223. There, in a unanimous opinion, the court expressly recognized that “the only satisfactory excuse for delay in payment of disability benefits, whether prior to or subsequent to an award, is genuine doubt from a medical or legal standpoint as to liability for benefits. (Id. at p. 230). The burden is on the employer to present substantial evidence on which a finding of such doubt may be based. (Id. at p. 227; Johnson v. Workers’ Comp. Appeals Bd. (1985) 163 Cal.App.3d 770). Further, one must ensure that the decision is well-documented to avoid audit penalties and assessments.
However, unless the applicant’s attorney is willing to waive any issues regarding transferring funds from one injury claim to another, I think you are at risk in advancing permanent disability without an apportionment finding.
I think this case is interesting because the WCAB pointed out that the defendants now have to take the bad with the good, as far as this particular decision. However, I think the applicants now are going to have to take the bad with the good in future cases. The long term here is this decision clearly gives defendants a reason hold off on advancing permanent disability when there are multiple injuries for the same body part pending and there is no finding on apportionment. So the applicant won the battle but lost the war.
In summary, the lesson is make sure you know your file and how many injuries are on file. Advance permanent disability carefully and only where you have a clear indication as to the amount of permanent disability on each claim.