Pods, Inc., et al. v. WCAB (Grove & Travelers) (Majority Opinion)

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IN THE COMMONWEALTH COURT OF PENNSYLVANIA Pods, Inc. and Wausau Insurance, Petitioners : : : v. : : Workers Compensation Appeal Board : (Gregory Grove and Travelers), : Respondents : BEFORE: No. 2140 C.D. 2007 Submitted: March 20, 2008 HONORABLE DORIS A. SMITH-RIBNER, Judge HONORABLE ROBERT SIMPSON, Judge HONORABLE JIM FLAHERTY, Senior Judge OPINION NOT REPORTED MEMORANDUM OPINION BY SENIOR JUDGE FLAHERTY FILED: May 12, 2008 PODS, Inc. (PODS) and Wausau Insurance Company (Wausau) petition for review from an order of the Workers Compensation Appeal Board (Board) that affirmed the decision of a Workers Compensation Judge (WCJ) that held Wausau liable for benefits following a recurrence of a February 24, 2005 work injury. We affirm in part, reverse in part, and remand for the reasons stated below. Gregory Grove (Claimant) sustained an injury to his left shoulder in the course and scope of his employment with PODS on February 24, 2005. PODS, through its insurer at that time, Wausau, accepted a rotator cuff tear via a Notice of Compensation Payable. Claimant s benefits were subsequently suspended effective August 5, 2005. Claimant filed a Claim Petition on October 3, 2005 against PODS alleging he sustained a torn left rotator cuff in the course and scope of his employment on September 1, 2005. Claimant named Travelers as the at risk insurer for the September 1, 2005 injury date. On that same date, Claimant filed a Reinstatement Petition against PODS and Wausau alleging a worsening of his accepted work injury resulting in a decrease in earning power. The WCJ entered an interlocutory order pursuant to Section 410 of the Pennsylvania Workers Compensation Act (Act) (410 Order) directing the insurers to pay one half of Claimant s workers compensation benefits at the rate of $358.00.1 This was formally documented on November 30, 2005. (R.R. at 39a). Claimant testified that he was employed by PODS working to manufacture portable storage units. He stated that on February 24, 2005, he sustained an injury to his left shoulder in the nature of a rotator cuff tear while attempting to place a roof on a pod. He felt a burning sensation and stiffness in his left shoulder. He could not fully move his left arm or hand. Claimant underwent surgery and the normal course of therapy. He returned to light duty and experienced soreness upon his return. He felt a burning sensation on August 5, 2005 and sought medical attention. Ultimately, on September 1, 2005, his rotator 1 Section 410 of the Act, Act of June 2, 1915, P.L. 736, as amended, 77 P.S. § 751, provides in pertinent part: Whenever any claim for compensation is presented and the only issue involved is the liability as between the defendant or the carrier or two or more defendants or carriers, the referee of the department to whom the claim in such case is presented shall forthwith order payments to be immediately made by the defendants or the carriers in said case. After the department s referee or the board on appeal, render a final decision, the payments made by the defendant or carrier not liable in the case shall be awarded or assessed against the defendant or carrier liable in the case, as costs in the proceedings, in favor of the defendant or carrier not liable in the case. 2 cuff tore again. The incident occurred while Claimant was stretching out a piece of tape to apply to a pod and he felt the burning and tearing sensation. Claimant explained he was not reaching overhead. Claimant presented the testimony of Stein M. Sletten, M.D., board certified in orthopedic surgery, who first saw him on March 18, 2005 following Claimant s initial work injury.2 Dr. Sletten diagnosed a complete tear of the left shoulder rotator cuff with moderate retraction of a cuff tendon. On March 23, 2005, Dr. Sletten performed shoulder arthroscopy with mini rotator cuff repair. Dr. Sletten explained that non-soluble suture anchors are used to keep the tendon in place. He added that because the tendon was torn away from the bone and reattached it would never get back to full strength and that it increased the risk of subsequent injury. Claimant was cleared for light duty in August of 2005 with limited use of the left arm but permitted to lift up to thirty pounds. Dr. Sletten agreed that Claimant had complaints of soreness in his left shoulder upon returning to light duty. Dr. Sletten saw Claimant on September 2, 2005 following the work incident that occurred the day before. A new MRI was performed showing a recurrent full thickness tear. On October 11, 2005, Dr. Sletten performed another left shoulder arthroscopy and a mini open rotator cuff repair. He noted that at this time the cuff tendons had retracted and he was unable to bring the tendon back to its original attachments. Dr. Sletten indicated that the tear was in the same area as the original tear. Dr. Sletten issued a narrative report dated November 4, 2005 wherein he indicated that Claimant s left shoulder injury of September 1, 2005 was 2 Although not pertinent to our ultimate disposition in this case but, rather, for the sake of clarification, Dr. Sletten is board certified in Norway, not the United States. 3 a recurrence of his prior injury of February 24, 2005. He agreed that the event where Claimant extended his arm to pull the tape could have caused the re-tear of the cuff. He noted that rotator cuff tears are most frequently caused by a combination of prior wear and a new injury or trauma. According to Dr. Sletten, had the event of September 1, 2005 not occurred, he was prepared to release Claimant to unrestricted full duty on September 15, 2005. Dr. Sletten explained that it was evident at the second surgery that the tissues were not with normal elasticity suggesting that claimant did not heal from the first injury properly. Dr. Sletten testified that normal recovery time for a rotator cuff tear post surgery is nine months but considering Claimant s prior complications, he would expect the recovery time following the second surgery to be longer. He added that [t]he original injury from February 24th has caused the whole problem to occur. (R.R. at 177a). Dr. Sletten, on cross-examination, agreed that the event that occurred on September 1, 2005 was a significant event. He further agreed that in his November 4, 2005 report he indicated that Claimant sustained a new injury. Dr. Sletten conceded he completed a form as requested by Wausau wherein he indicated that Claimant sustained a new injury and/or an aggravation, exacerbation, or acceleration of his prior work injury of February 24, 2005. He further indicated that Claimant s current condition was not a direct result of the February 2005 injury therein. Nonetheless, while he acknowledged Claimant had a sudden onset of pain while utilizing the tape roll, Dr. Sletten reiterated Claimant s experience of feeling sore after returning to light duty. He further emphasized that the two tears were at the same location. Dr. Sletten also clarified his responses to Wausau s form that he completed and stated that [Claimant] probably had a new pull to that 4 tissue that was still in the healing phase down to the bone, and in that way aggravated the healing process. (R.R. at 195a). Travelers presented the testimony of Daniel P. Hely, M.D., board certified orthopedic surgeon, who examined Claimant on January 4, 2006. Dr. Hely stated Claimant re-injured or aggravated his initial injury on September 1, 2005. He noted it was the exact same problem in the rotator cuff that had originally been repaired. According to Dr. Hely, the fact that the rotator cuff tore again evidences that he did not fully recover following the first arthroscopy. He added that it is axiomatic that the cuff would not be the same as it was prior to the February 24, 2005 incident. Specifically, he stated [i]t was thought to be strong enough to go back to work; but, it, obviously, wasn t because normal work activity resulted in the same thing happening again. (R.R. at 236a). Dr. Hely further stated it certainly [was not] a new injury. It seem[ed] like a recurrence to me. (Id.) Dr. Hely agreed that in his report he wrote that Claimant sustained a new injury while at work on September 1, 2005. He further agreed that Claimant reported a discrete event occurring on that date whereupon he felt a tearing sensation. According to Dr. Hely, there were two separate events occurring to the same injured tissue. In a decision dated February 28, 2007, the WCJ explained the medical evidence presented contained elements that would tend to support a finding of a recurrence and other elements that would tend to support a finding of an aggravation or new injury. Nonetheless, he found that overall, the medical evidence indicated that Claimant sustained a recurrence as opposed to an aggravation on September 1, 2005. Specifically, the WCJ relied on the statements of Drs. Sletten and Hely that the September 1, 2005 rotator cuff tear occurred at the 5 same location as the February 24, 2005 tear. Moreover, he noted that Dr. Sletten s testimony tended to establish that Claimant s second rotator cuff tear was more or less a complication in the recovery process following the first arthroscopy. The WCJ added that while the medical experts agreed that there was a significant event with a sudden onset of pain on September 1, 2005, the evidence indicated Claimant had complaints preceding this date following his return to work at light duty. Finally, the WCJ pointed out that Claimant was not reaching overhead when the second incident occurred but, rather, reaching out. In rendering his Decision, the WCJ noted I do think that notice was met and all the elements of a claim for a new injury as well. (Dec. dated 2/28/07, p. 6). Moreover, in Conclusion of Law No. 4, the WCJ indicated that Claimant met all the elements to establish a new injury. In Conclusion of Law No. 5, however, the WCJ again indicated that the evidence established Claimant sustained a recurrence of his original 2004 3 injury. Ultimately, although not expressly stated, the WCJ granted Claimant s Reinstatement Petition and denied Claimant s Claim Petition. The WCJ found Wausau to be the liable insurer and directed it to reimburse Travelers for the money paid pursuant to the 410 Order. The WCJ further indicated that there was a genuine dispute as to whether Claimant sustained a recurrence of his February 24, 2005 injury on September 1, 2005 or a new injury. Nonetheless, he awarded unreasonable contest attorney s fees of $9,288.00 reasoning I think the case law is clear that a reasonable contest between two 3 Wausau points out that that Claimant did not sustain an injury in 2004. We agree. This, however, is merely a typographical error and does not affect the outcome of this case. 6 defendants is not a reasonable contest with regard to the claimant ¦. (Dec. dated 2/28/07, p. 6). Claimant appealed to the Board which affirmed in an order dated October 24, 2007. This appeal followed.4 Wausau argues on appeal that the WCJ erred in holding it liable for Claimant s September 1, 2005 rotator cuff injury. It contends that the evidence of record supports a finding that Claimant sustained a new injury on that date and therefore Travelers should be the liable insurer. Wausau contends that the WCJ recognized as such but committed error by rendering further findings indicating Claimant sustained a recurrence. In turn, Wausau asserts that the WCJ failed to issue a reasoned decision because he rendered findings of fact and conclusions of law that are internally inconsistent with one another. If a compensable disability results directly from a prior injury but manifests itself on the occasion of an intervening incident that does not materially contribute to the physical disability, then the claimant has suffered a recurrence. Reliable Foods v. Workmen s Compensation Appeal Board (Horrocks), 660 A.2d 162 (Pa. Cmwlth. 1995). Conversely, where the intervening incident does materially contribute to the renewed physical disability, a new injury or aggravation has occurred. South Abington Twp. v. Workers Compensation Appeal Board (Becker), 831 A.2d 175 (Pa. Cmwlth. 2003). Whether or not the 4 Our review is limited to determining whether an error of law was committed, whether necessary findings of fact are supported by substantial evidence and whether constitutional rights were violated. DeGraw v. Workers Compensation Appeal Board (Redner's Warehouse Mkts., Inc.), 926 A.2d 997 (Pa. Cmwlth. 2007). In reviewing a workers compensation decision, we must view the evidence in a light most favorable to the party who prevailed before the WCJ. Birmingham Fire Ins. Co. v. Workmen s Compensation Appeal Board (Kennedy), 657 A.2d 96 (Pa. Cmwlth. 1995). 7 intervening incident materially contributes to a claimant s disability is a question of fact to be determined by the WCJ. C.P. Martin Ford, Inc. v. Workmen s Compensation Appeal Board (Dzubur), 767 A.2d 1164 (Pa. Cmwlth. 2001). It should be noted that the terms recurrence and aggravation are legal terms of art and not medical terms. Reliable Foods, 660 A.2d at 166. Therefore, a final determination is not based upon specific words used by the medical experts, but rather upon a careful review of the medical testimony to determine its substance rather than its form. Id. at 166-167. If the claimant sustained an aggravation of an injury, the employer s current insurer is liable for all medical and wage loss benefits arising from the new injury. Becker, 831 A.2d at 182. Alternatively, if a claimant sustained a recurrence, the insurance carrier responsible for the original injury will be held liable for all disability benefits resulting from the most recent injury. Id. When there is a single disabling medical condition, there must be a determination as to whether there has been a recurrence or an aggravation. Id. It does not matter that there is other evidence of record that supports a factual finding other than that made by the WCJ. Hoffmaster v. Workers Compensation Appeal Board (Senco Prods. Inc.), 721 A.2d 1152 (Pa. Cmwlth. 1998). Rather, the proper inquiry is whether there is any evidence that supports the WCJ s factual finding. Id. at 1155. Nonetheless, it has been held that remand is appropriate when a WCJ makes findings of fact that are inconsistent with his conclusions of law. Haddon Craftsmen v. Workers Compensation Appeal Board (Krouchick), 809 A.2d 434 (Pa. Cmwlth. 2002). Upon review, we see no error in the WCJ s determination. Based on the WCJ s issuance of the 410 Order, there was no dispute that claimant sustained 8 a second rotator cuff tear while in the course and scope of his employment with PODS. The sole issue to be decided by the WCJ was whether Claimant sustained a recurrence of his original injury rendering Wausau liable for his benefits or a new injury or aggravation placing liability on Travelers. Becker. We recognize that both Dr. Sletten and Dr. Hely utilized the terms aggravation and recurrence in their deposition testimony when discussing the incident occurring September 1, 2005. Pursuant to Reliable Foods, we must be cognizant of the fact that medical experts may not use these terms as they may be used in the legal profession. Thus, a determination as to whether Claimant sustained a recurrence or aggravation must be made upon a review of the medical testimony as a whole. As indicated in Reliable Foods and Becker, whether Claimant sustained a new injury or a recurrence while working light duty turns on whether the incident whereupon he was stretching out a piece of tape to apply to a pod materially contributed to his renewed physical disability. This is a question of fact to be determined by the WCJ. Dzubur. The WCJ found that while there was an intervening incident, that incident did not materially contribute to Claimant s renewed disability. As such, he found Claimant sustained a recurrence and held Wausau liable for Claimant s indemnity benefits and resultant medical expenses. In so finding, the WCJ relied on the fact that the subsequent rotator cuff tear occurred at the same location as the February 24, 2005 tear, that Claimant had not fully recovered from his prior rotator cuff tear when the second incident occurred, that Claimant had complaints of soreness prior to September 1, 2005 after returning to light duty, and that Claimant was not reaching overhead when the second rotator cuff tear occurred. Looking at the evidence in a light most favorable to the party prevailing below as we are 9 required to do pursuant to Kennedy, we cannot agree with Wausau that there is not sufficient evidence of record to place liability upon it for a recurrence of Claimant s February 24, 2005 injury. While there may be evidence of record to support a finding that Claimant sustained a new injury on September 1, 2005, the proper inquiry is whether there is sufficient evidence to support the WCJ s findings of fact. Hoffmaster. We are cognizant of the fact that consistent with Haddon Craftsmen, a matter should be remanded when a WCJ s findings of fact are inconsistent with his conclusions of law. Nonetheless, we reject any argument by Wausau that the WCJ s findings of fact and conclusions of law are inconsistent. The WCJ expressly stated that the medical opinions can be read to support a finding of either a recurrence or a new injury. Nonetheless, he further stated I thought the medical opinions taken as a whole gave an opinion of recurrence as opposed to a new injury and provided the aforementioned reasoning for his determination. (Dec. dated 2/28/07, p. 6). Moreover, in his Order, the WCJ found Wausau liable consistent with his belief that the evidence as a whole established that it was more likely than not that Claimant s September 1, 2005 rotator cuff tear was a recurrence of his prior injury. This was his prerogative as fact finder.5 Dzubur. Wausau further argues on appeal that the WCJ erred in finding it presented an unreasonable contest and in awarding attorney s fees. We believe a remand is necessary on this issue only. 5 We do not hesitate to point out that the present case is not the first wherein the evidence could support a finding of either a recurrence or an aggravation. Indeed, such a situation was presented in Reliable Foods. Reliable Foods, 660 A.2d at 167-8. 10 Section 440(a) of the Act, added by Section 3 of the Act of February 8, 1972, P.L. 25, 77 P.S. §996, provides that if an employer contests liability it will be liable for claimant s costs, including counsel fees, if the matter is resolved in whole or in part in the claimant s favor. That section specifies, however, that attorney s fees may be excluded if the employer presents a reasonable contest. It has previously been held that when there is no dispute that a claimant sustained a work-related injury and the only remaining issue is which one of the employer s two insurance companies is liable, there can be no reasonable contest. Morgan v. Workers Compensation Appeal Board (Strock), 590 A.2d 1375 (Pa. Cmwlth 1991). See also Franklin Steel Co. v. Workmen s Compensation Appeal Board (Clark), 665 A.2d 1310 (Pa. Cmwlth. 1995). There can be no reasonable contest because a controversy between an employer s two insurance companies as to what insurer is liable is a controversy among parties on the same side, not a controversy between [the] [e]mployer and [the] [c]laimant. Morgan, 590 A.2d at 1378. Nonetheless, we have recently clarified that when the claimant himself raises the issue of what insurer is liable for his benefits by filing separate petitions on separate theories of liability, the entry of a 410 order ends the insurer s contest with the claimant. Bittinger v. Workers Compensation Appeal Board (Lobar Assoc., Inc.), 932 A.2d 355 (Pa. Cmwlth. 2007). Thus, the entrance of the interlocutory order ends the liable insurer s exposure to unreasonable contest attorney s fees. Id. at 359. The WCJ awarded unreasonable contest attorney s fees totaling $9,288.00, the full amount of fees sought by Claimant s counsel in Claimant s Exhibit No. 14. (R.R. at 230a). Despite the fact that there was a genuine dispute as to whether Claimant sustained a new injury or a recurrence on September 1, 11 2005, the WCJ awarded counsel fees reasoning I think the case law is clear that a reasonable contest between two defendants is not a reasonable contest with regard to a claimant. The WCJ, however, did not have the benefit of Bittinger at the time he issued his Decision. In the present matter, Claimant filed separate petitions under separate theories of recovery to obtain benefits for his second rotator cuff tear occurring on September 1, 2005. He filed a Claim Petition on October 3, 2005 against PODS alleging he sustained a torn left rotator cuff in the course and scope of his employment on September 1, 2005 and named Travelers as the at risk insurer. He also filed a Reinstatement Petition against PODS alleging a worsening of his previously accepted rotator cuff tear for which Wausau was liable. Bittinger dictates that any liability for unreasonable contest attorney s fees ended upon the entrance of the 410 Order. A cursory review of Claimant s Exhibit No. 14 reveals several charges for services rendered after the interlocutory order was entered. Thus, we must remand this matter to the Board for purposes of further remand to the WCJ to modify his award of unreasonable contest attorney s fees and limit it to fees incurred prior to the entry of the 410 Order on November 30, 2005. JIM FLAHERTY, Senior Judge 12 IN THE COMMONWEALTH COURT OF PENNSYLVANIA Pods, Inc. and Wausau Insurance, Petitioners : : : v. : : Workers Compensation Appeal Board : (Gregory Grove and Travelers), : Respondents : No. 2140 C.D. 2007 ORDER AND NOW, May 12, 2008, the Order of the Workers Compensation Appeal Board is reversed to the extent it affirms the WCJ s determination that Claimant is entitled to unreasonable contest attorney s fees in the amount of $9,288.00. We remand this matter to the Board for purposes of further remand to the WCJ to modify his award of unreasonable contest attorney s fees and limit it to fees incurred prior to the entry of the interlocutory order issued pursuant to section 410 of the Pennsylvania Workers Compensation Act. The above-captioned matter is affirmed in all other respects. Jurisdiction relinquished. JIM FLAHERTY, Senior Judge

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