CURRIES COMPANY and TRAVELERS INSURANCE COMPANY, Petitioners-Appellants, vs. CHRISTOPHER A. MCCURDY, Respondent-Appellee.
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IN THE COURT OF APPEALS OF IOWA
No. 7-862 / 07-0427
Filed January 16, 2008
CURRIES COMPANY and TRAVELERS
INSURANCE COMPANY,
Petitioners-Appellants,
vs.
CHRISTOPHER A. MCCURDY,
Respondent-Appellee.
________________________________________________________________
Appeal from the Iowa District Court for Polk County, Don C. Nickerson,
Judge.
Petitioners appeal the district court’s ruling affirming that respondent
sustained a compensable work-related injury and was entitled to penalty benefits.
AFFIRMED.
Aaron T. Oliver, Hansen, McClintock & Riley Law Firm, Des Moines, for
appellants.
James T. Fitzsimmons, Fitzsimmons & Vervaecke Law Firm, Mason City,
for appellee.
Considered by Sackett, C.J., Vaitheswaran and Baker, JJ.
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SACKETT, C.J.
Petitioners-appellants,
Curries
Company
(Curries)
and
Travelers
Insurance Company (Travelers) appeal the district court’s ruling affirming the
Iowa Workers’ Compensation Commissioner’s findings that bilateral foot injuries
suffered by Christopher McCurdy arose out of his employment with Curries, and
McCurdy sustained a compensable work-related injury, and was entitled to
penalty benefits because the petitioners had no reasonable basis to deny his
claim. Curries and Travelers appeal these determinations. We affirm.
I.
BACKGROUND.
McCurdy filed the petition that led to this appeal with the commissioner on
March 3, 2003. He contended he was injured as a result of standing for long
periods on a concrete floor. He claimed an injury date of July 1, 2001, and stated
he was disabled from that date to the date of the petition and that the injury was
continuing. McCurdy began working at Curries in 1988. He worked in various
positions all of which required him to stand on concrete all day. He had job
changes in 2000 which involved less movement in the work area and the
availability of a rubber mat where he could stand.
In March 2001, McCurdy developed foot pain. In May, he reported the
pain to the plant safety manager. In July, McCurdy began seeing a podiatrist, Dr.
Henrich, for his foot problems.
Dr. Henrich diagnosed McCurdy with severe
bilateral plantar fasciitis which is commonly known as heel spur syndrome. Dr.
Henrich, in the medical report from the initial examination, noted that this was a
work-related situation. On October 11, a Travelers claim representative notified
McCurdy by letter that the claim was investigated and Travelers was denying the
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claim based on the information they had received. Dr. Henrich wrote several
letters to Travelers stating that McCurdy’s condition was work-related and due to
“walking on hard surfaces for prolonged periods of time.” He asked them to
approve the claim and permit McCurdy to have surgery for the condition.
Meanwhile, Dr. Henrich continued treating McCurdy’s plantar fasciitis with
conservative measures, including physical therapy, orthodic inserts, injections,
restrictions on footwear, and anti-inflammatory medications.
At an appointment in December of 2001, Dr. Henrich restricted McCurdy’s
work, advising that he could not work overtime. Curries had a policy that anyone
that had a work restriction that was from an injury that was not work-related, had
to take sick leave until they were able to work without any restrictions. Since
Travelers deemed the claim not work-related, and Curries considered the
doctor’s prohibition of overtime to be a restriction, McCurdy was forced to take
sick leave.
McCurdy took sick leave until April 2002 when a co-worker
intervened to get McCurdy back at work.
Despite multiple letters from Dr.
Henrich advising the injury was attributable to work, Travelers continued to deny
the claim, stating they had not received all of the medical notes and test results
related to the claim.
All of the medical records were subsequently sent to
Travelers. Travelers did not provide any initial response to the receipt of the
medical records but on April 17, 2002, Travelers confirmed to McCurdy’s attorney
that it had received the medical records.
The record shows no additional
correspondence indicating any further review or investigation of the claim by
Travelers despite additional letters sent by Dr. Henrich and McCurdy’s attorney in
May and June of 2002.
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McCurdy began suffering from night spasms and knee pain due to the
plantar faciitis and Dr. Henrich prescribed night splints in July of 2002.
In
November, McCurdy was examined by another physician, Dr. Groen, for a
second opinion as to whether the condition was work-related. Groen’s initial
report stated:
I cannot say that Chris’[s] work was the sole factor causing his foot
condition. Although, in my opinion, the transition from a job
allowing movement to a job requiring standing for extended periods
of time in a welding position was a substantial contributing factor or
cause of his bilateral foot condition. It would have been helpful had
Chris’[s] foot condition been taken care of earlier.
In response to this opinion, counsel for Travelers advised Groen that McCurdy
had been in the same position throughout his employment at Curries. Groen
then revised his opinion to conclude that absent a job site change, Mr. McCurdy’s
condition could not be caused by his employment.
After Groen received
information clarifying McCurdy’s various positions at Curries, he concluded that
the position change was probably a contributing factor to the condition.
In April 2004, McCurdy decided he could no longer tolerate the pain and
needed to have the surgery even though Travelers had denied his claim and
despite his financial concerns.
Dr. Henrich performed surgery on McCurdy’s
right foot in May of 2004 and his left foot in October of 2004. At the time of the
hearing in February 2005, both feet were healing well with no permanent
impairment predicted although McCurdy had not been released to go back to
work. While recovering, McCurdy received some income from sick leave and
long term disability payments.
A hearing on McCurdy’s petition was held on February 9, 2005. A deputy
commissioner ruled in McCurdy’s favor finding (1) the injury arose out of and in
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the course of his employment, (2) McCurdy was entitled to payment of medical
expenses and healing period benefits, and (3) the denial of benefits without
explanation warranted an award of penalty benefits in the amount of fifty percent
of the healing period benefits, minus a credit for benefits previously paid. On
appeal from the arbitration decision, the commissioner held that the failure to
explain the denial of benefits “is not an independent ground for awarding penalty
benefits.” However, the commissioner found the penalty award was supported
because Travelers failed to pay benefits even after both examining doctors found
the syndrome work-related. The district court found the agency did not abuse its
discretion and its findings were supported by substantial evidence.
II.
STANDARD OF REVIEW.
In our review of workers’ compensation claims, we analyze the
commissioner’s decision under the standards set forth in Iowa Code section
17A.19(10) (2005) and decide whether the district court correctly applied the law
in exercising its judicial review function. Lakeside Casino v. Blue, __ N.W.2d
___, __ (Iowa 2007). “In determining the proper standard of review, we must first
identify the nature of the claimed basis for reversal of the commissioner’s
decision.” Id. Assertions that the commissioner incorrectly found an injury arose
out of and in the course of employment “presents a mixed question of law and
fact.” Id. We must carefully articulate the appellant’s challenge because review
of mixed questions of law and fact varies depending on the precise claim of error
asserted. Meyer v. IBP, Inc., 710 N.W.2d 213, 219 (Iowa 2006).
Here, Travelers and Curries do not disagree with the commissioner’s fact
findings or interpretations of law. Instead, their arguments are directed at the
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commissioner’s ultimate conclusion resulting from alleged misapplication of the
law. For these claims, the question on review is whether the agency abused its
discretion by reaching its conclusion through one of the forbidden means listed in
Iowa Code section 17A.19(10). Id. Travelers and Curries contend the agency
violated several provisions in this section by reaching a conclusion unsupported
by substantial evidence, ignoring important and relevant evidence, and
employing illogical and irrational reasoning. See Iowa Code § 17A.19(10)(f), (i),
(j).
III.
COMPENSABLE INJURY.
Travelers and Curries first argue that the agency decision was in error
because the commissioner ignored key evidence and there was not substantial
evidence to support the conclusion that McCurdy’s injury was related to his
employment. On this claim, “[e]rror occurs when the commissioner makes a
legal conclusion based on facts that are inadequate to satisfy the governing legal
standards.”
Meyer, 710 N.W.2d at 220 n.1.
This can happen “[i]f the
commissioner fails to consider relevant evidence in making a conclusion, fails to
make the essential findings to support the legal conclusion, or otherwise commits
an error in applying the law to facts.” Id.
The legal standard for determining whether an injury “arises out of” and “in
the course of” employment has been defined by our case law:
An injury “arises out of” the employment if a causal connection
exists between the employment and the injury. The injury arises “in
the course of” employment when the injury and the employment
coincide as to time, place, and circumstances. Both tests must be
satisfied for an injury to be deemed compensable.
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Id. at 222. The “arising out of” element “requires that the injury be . . . a rational
consequence of the hazard connected with the employment.” Id. The causal
relation required is less demanding than that required under tort law. Id. at 223.
The employment must only be the “condition out of which the event arises.” Id.
The “course of employment” requirement is met if the injury occurs “within the
period of the employment, at a place where the employee reasonably may be,
and while the employee is fulfilling work duties or engaged in doing something
incidental thereto.” Id. at 222.
The commissioner found these legal standards were met, explaining,
The defendants acknowledge that the claimant worked on concrete
floors since he began his employment . . . yet argue that since
nothing changed when he changed jobs his current foot conditions
cannot be caused by the job change. It is of course not necessary
that the job change in 2000 be the cause of the claimant’s current
foot conditions. His burden is to show that his work conditions,
perhaps throughout the time he worked for the employer,
substantially caused his bilateral foot conditions. By pointing out
that the claimant worked for 12 years on a hard concrete floor, the
defendants only underscore the claimant’s case.
The commissioner noted that McCurdy’s condition was a cumulative injury which
seemed to worsen when his movement became more restricted due to a job
change. The commissioner rejected the argument that there lacked a causal
relationship since McCurdy did not develop symptoms until several months after
the job change stating, “by definition a cumulative injury will not result in
symptoms the first day of a job.”
The commissioner also found the legal
standard was met because “all of the medical opinions in this case establish that
the claimant’s current bilateral foot conditions are caused by his work
conditions.”
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Travelers and Curries argue the commissioner ignored evidence
favorable to them, such as evidence showing that, (1) McCurdy has worked the
entire time standing on a concrete floor at Curries, (2) McCurdy was actually
able to work on a rubber mat after a job change in 2000, and (3) he worked at
such position for several months before claiming his feet hurt.
The commissioner did consider this evidence and found these facts
actually supported the legal conclusion that the condition arose out of and in the
course of McCurdy’s employment.
The commissioner did not ignore this
information. Also, a cumulative injury “develops over time from performing workrelated activities and ultimately produces some degree of industrial disability.”
Ellingson v. Fleetguard, Inc., 599 N.W.2d 440, 444 (Iowa 1999). The facts that a
rubber mat was provided at one job position and that symptoms did not manifest
until 2001 do not undercut the finding that the cumulative injury was workrelated. McCurdy worked on a rubber mat for a relatively short period of time in
comparison to his other positions and this position restricted his movement,
which testimony showed aggravated the condition. The fact that McCurdy’s
symptoms manifested years into his career at Curries supports the finding that
the condition developed over time and was cumulative.
Travelers and Curries also argue the commissioner abused its discretion
in applying the law by employing illogical and irrational reasoning under Iowa
Code section 17A.19(10)(i). Specifically they contend the commissioner failed
to address inconsistencies in medical expert opinions and changing theories of
recovery. Travelers and Curries argue the medical records show no causal
connection because Dr. Henrich changed his opinions on the cause of the
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condition over time and thus, McCurdy’s theory of recovery changed. They
argue Dr. Henrich’s reports do not consistently state the cause of the condition,
varying between being caused by “being on hard surfaces for long periods of
time,” “standing in one spot all day,” and “walking on hard surfaces for long
periods.”
We find no inconsistency in Henrich’s conclusion on causation.
Dr.
Henrich’s testimony pointed out that the condition was due to the hard surfaces
and inability to relax certain foot tendons. The condition is exacerbated when
movement is restricted. McCurdy encountered these conditions while at work.
The symptoms were merely aggravated the more movement was restricted at
Curries.
There was no inconsistency in Dr. Henrich’s overall opinion and
conclusion that the syndrome was work-related. Dr. Henrich’s opinion on the
cause of the syndrome was supported by McCurdy’s co-workers’ testimony
about the working conditions in various positions at Curries.
The minor
inconsistencies argued by Travelers and Curries do not evince illogical
reasoning by the commissioner.
Travelers and Curries further argue that Dr. Henrich did not know some
specific details about when McCurdy changed positions at Curries, that he
worked on a rubber mat at one position, and that Dr. Henrich admitted to an
error in one report. They also urge that the article they provided about plantar
fasciitis from a Workers’ Compensation Manual provides a more reliable medical
opinion than those of the two doctors who examined McCurdy.
These
arguments pertain to credibility determinations rather than errors in the
application of law. Under our judicial review we give deference to the credibility
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determinations of the agency’s presiding officer and find no error on these
grounds. See Iowa Code § 17A.19(10)(f)(3); Lange v. Iowa Dep’t of Revenue,
710 N.W.2d 242, 247 (Iowa 2006).
IV.
PENALTY BENEFITS.
Travelers and Curries also contend that the commissioner abused its
discretion in awarding McCurdy penalty benefits. Travelers and Curries assert
error was committed because the commissioner reached its conclusion by an
erroneous interpretation of law, ignoring important and relevant evidence, and by
employing illogical or irrational reasoning under Iowa Code section 17A.19(10).
The commissioner awarded the penalty benefits, determining that Travelers had
no reasonable basis to deny the claim because McCurdy’s claim was not fairly
debatable.
The applicable legal standards are established by statute and case law.
If a delay in commencement or termination of benefits occurs
without reasonable or probable cause or excuse, the workers’
compensation commissioner shall award benefits in addition to
those benefits payable under this chapter . . . up to fifty percent of
the amount of benefits that were unreasonably delayed or denied.
Iowa Code § 86.13. This section imposes “an affirmative obligation on the part of
the employer and insurance carrier to act reasonably in regard to benefit
payments in the absence of specific direction by the commissioner.” Christensen
v. Snap-On Tools, Corp., 554 N.W.2d 254, 260 (Iowa 1996).
There is a
reasonable cause or excuse to withhold payments if “the employer had a
reasonable basis to contest the employee’s entitlement to benefits.” Keystone
Nursing Care Ctr. v. Craddock, 705 N.W.2d 299, 307 (Iowa 2005). There is a
reasonable basis for denial of benefits if the employee’s claim is “fairly
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debatable.” If payment was not made, we must focus on whether there was a
reasonable excuse for not making timely payment.” McIlravy v. North River Ins.
Co., 653 N.W.2d 323, 328 (Iowa 2002). The employer’s failure to provide the
employee with an explanation for the denial is not an independent ground
warranting penalty benefits.
Keystone, 705 N.W.2d at 308.
Failing to
reinvestigate a claim after receiving additional medical information can raise the
inference that there is no reasonable basis for denying the claim. McIlravy, 653
N.W.2d at 332-33.
In the original arbitration decision the commissioner cited the failure to
provide reasons for the denial as one justification for the penalty award. On
appeal, the commissioner noted that under Keystone, this alone cannot justify a
penalty award. Despite this error, the commissioner and district court found the
record provided ample grounds for imposing the penalty award. The district court
concluded “there was no good faith dispute that could be factually resolved in
favor of the employer” because:
There have been no efforts at on-going investigation on behalf of
Travelers and there was no reasonable decision which would
involve the denial of the claim when all relevant medical evidence .
. . supported the conclusion that [McCurdy’s] injury was workrelated. Petitioners argue that this claim is “fairly debatable” for
several reasons, none of which are persuasive enough to
overcome the fact that the only medical professionals consulted in
this proceeding indicated that the injury was work-related.
The court found Travelers also failed to reinvestigate the claim even when
additional medical records were provided. Travelers and Curries point to the
same “inconsistencies” and credibility arguments addressed above as reasons
why the claim is “fairly debatable.” We agree with the district court that these
arguments do not generate a reasonable basis to deny the claim in light of the
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examining physicians’ repeated assertions that the injury was work-related and
their recommendations that Travelers’ approve McCurdy’s treatment and
surgery. There was no abuse of discretion in affirming the maximum penalty
award.
In conclusion, the district court properly upheld the commissioner’s
determinations that McCurdy’s injury was work-related and the unreasonable
denial of benefits warranted a penalty award.
AFFIRMED.
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