Opinion
No. 2-1014 / 02-0911
Filed March 26, 2003
Appeal from the Iowa District Court for Palo Alto County, Don E. Courtney, Judge.
Workers' compensation claimant appeals from the district court's decision on petition for judicial review affirming workers' compensation commissioner's order regarding penalty benefits. The employer cross-appeals from the district court's order remanding to the agency for further factual findings regarding permanent partial disability. REVERSED AND REMANDED WITH DIRECTIONS.
Mark Soldat, Algona, for appellant.
Michael Jacobs of Rawlings, Nieland, Probasco, Killinger, Ellwanger, Jacobs Mohrhauser, L.L.P., Sioux City, for appellees.
Considered by Vogel, P.J., and Zimmer and Hecht, JJ.
Nathan Rouse appeals from the district court's decision on a petition for judicial review. He claims the court erred by not reversing the commissioner's failure to impose certain penalties. He also asserts the court erred in failing to reverse the commissioner's taxation of a share of intra-agency appeal costs to the worker. H S Roofing Company and CNA Insurance Company (both "CNA") cross-appeal contending the district court's decision to remand to the agency for further factual findings regarding permanent disability was in error. We reverse and remand with directions.
I. Background Facts and Proceedings.
On November 25, 1997, Rouse fell from a scaffold and suffered a serious, complex fracture of a bone in his right lower extremity. Treating physician, Philip Deffer, M.D., performed successful surgery to anatomically realign the injury to claimant's ankle, which included application of hardware to fixate the displaced bone. Rouse was subsequently placed in a non-weight bearing cast.
On February 11, 1998, Dr. Deffer instructed claimant to begin range of motion exercises, placed him in a walker, and indicated he could put twenty to thirty pounds of weight on the affected leg. On March 13, 1998, Dr. Deffer indicated Rouse could begin full weight bearing. A month later, Rouse told Dr. Deffer he was doing well but was experiencing pain. Dr. Deffer placed claimant in an air stirrup splint and discontinued use of the walker. In May 1998, Rouse was referred to physical therapy. By the end of May, Rouse had returned to work as a roofer.
During early June of 1998, Dr. Deffer re-examined Rouse. His x-rays indicated appropriate alignment of the ankle. However, Rouse had limited range of motion and was restricted from running. Claimant returned to Dr. Deffer in April 1999 complaining of recurring pain. X-rays revealed that claimant might be developing early posttraumatic arthritis.
In early September 1998, Dr. Deffer examined Rouse for the purpose of offering a functional impairment rating for his right ankle. After the examination, Dr. Deffer opined that Rouse had suffered a thirty-seven percent lower extremity impairment. Later, Rouse obtained another impairment rating from Dr. Justin Ban. On April 12, 2000, Dr. Ban offered his opinion that Rouse had a thirty-six percent lower extremity impairment as a result of his injury.
Rouse filed his petition for workers' compensation benefits on September 17, 1998. CNA voluntarily paid Rouse healing period and temporary partial benefit compensation. Rouse was paid permanent partial disability benefits beginning June 7, 1998.
In October 2000, a deputy commissioner filed an arbitration decision. The deputy found Rouse had a thirty-seven percent impairment of his right lower extremity and accordingly was entitled to 81.4 weeks of benefits. The deputy concluded Rouse had already received the permanent partial, healing period, and temporary partial benefits which he was owed on his claim. In addition, a penalty of $1000 was assessed against CNA for untimely payment of weekly benefits. Both parties appealed.
In April 2001, the commissioner filed an appeal decision affirming the permanent partial disability award of thirty-seven percent to the lower extremity. The decision also affirmed the penalty award, but reduced the amount of the penalty assessed for delayed payments from $1000 to $231.66. Intra-agency appeal costs were taxed equally to Rouse and CNA.
In May 2001, Rouse filed a petition for judicial review. On January 31, 2002, the district court remanded the extent of disability issue for clarification of the impairment rating and deferred resolution of the penalty issue. Both parties filed motions requesting the court to enlarge, amend, or modify its decision. On June 3, 2002, the court responded by affirming the commissioner's penalty award and declining to modify its decision to remand regarding the issue of permanent impairment. These appeals followed.
II. Scope of Review.
An appeal from a district court decision on judicial review of an agency decision is limited to determining whether the district court correctly applied the law in exercising its review under Iowa Code section 17A.19(8) (2001). Herrera v. IBP, Inc., 633 N.W.2d 284, 287 (Iowa 2001). When we review findings of the workers' compensation commissioner, those findings carry the effect of a jury verdict. Kostelac v. Feldman's, Inc., 497 N.W.2d 853, 856 (Iowa 1993). We will reverse an agency's findings only if, after reviewing the record as a whole, we determine that substantial evidence does not support them. Terwilliger v. Snap-On Tools Corp., 529 N.W.2d 267, 271 (Iowa 1995). Evidence is substantial if a reasonable mind would accept it as adequate to reach the conclusion at issue. Kostelac, 497 N.W.2d at 856. The mere fact that we could draw inconsistent conclusions from the same evidence does not mean that substantial evidence does not support the commissioner's determination. Terwilliger, 529 N.W.2d at 271. The ultimate question is not whether the evidence supports a different finding but whether it supports the findings the commissioner actually made. Id.
III. Merits.
This appeal presents three issues:
(1) whether the trial court erred by not reversing the commissioner's assessment of certain penalty benefits pursuant to Iowa Code section 86.13,
(2) whether the district court erroneously remanded the issue of impairment to the commissioner, and
(3) whether the commissioner erroneously taxed the intra-agency appeal costs equally between the claimant and his employer. We address each issue in turn.
A. Penalty Benefits.
In resolving the penalty issue, the agency was required to apply Iowa Code section 86.13, which provides:
If a delay in commencement or termination of benefits occurs without reasonable or probable cause or excuse, the industrial commissioner shall award benefits in addition to those benefits payable under this chapter, or chapter 85, 85A, or 85B, up to fifty percent of the amount of benefits that were unreasonably delayed or denied.
In Christensen v. Snap-On Tools Corp., 554 N.W.2d 254, 260 (Iowa 1996), our supreme court held that the plain language of section 86.13 entitles an employee to penalty benefits when there has been a delay in payment unless the employer proves a reasonable cause or excuse. A reasonable cause or excuse exists if either (1) the delay was necessary for the insurer to investigate the claim or (2) the employer had a reasonable basis to contest the employee's entitlement to benefits. Christensen, 554 N.W.2d at 260. A "reasonable basis" for denial of the claim exists if the claim is "fairly debatable." Id. The agency must first ask if the employer had a reason for the delay and whether such reason was conveyed to the employee contemporaneously with the delay. Meyers v. Holiday Express Corp., 557 N.W.2d 502, 504 (Iowa 1996). If so, no penalty will be imposed if the reason is a "reasonable or probable cause or excuse." Id.
Weekly compensation payments are due at the end of the compensation week, Robbennolt v. Snap-On Tools Corp., 555 N.W.2d 229, 235 (Iowa 1996), and are "made" when mailed or personally delivered to the claimant. Meyers, 557 N.W.2d at 505. If a weekly benefit payment is not made on or before its due date, a penalty will be imposed pursuant to Iowa Code section 86.13 unless the employer provides a reasonable excuse for failing to do so and "conveys that reason to the employee contemporaneously with the beginning of the delay." Id. at 504.
The record reveals Rouse received healing period, temporary partial disability and permanent partial disability compensation following his injury. The commissioner found (1) the first payment of healing period benefits in the amount of $492.08 was at least two days late, (2) temporary partial disability benefits for the period March 18, 1998 through June 7, 1998 totaling $2143.35 were from two to nine days delayed, (3) six weeks of permanent partial disability benefits at a weekly rate of $332.97 were delayed, and (4) the employer offered no reasonable cause or excuse for delayed benefits totaling $4633.25.
Rouse claims the agency made an error of law in its determination of the penalty issue in this case. We agree. In order to determine whether a penalty is owed and the appropriate amount, if any, the agency must first make findings as to the timeliness of the payments. As noted above, the law measures timeliness by comparing the due dates of payments against the dates of mailing or delivery. We conclude the record is inadequate to accomplish judicial review of the penalty issue. First, we are unable to determine from the agency's appeal decision whether the agency correctly determined the payment due dates because they are not identified in the appeal decision. Second, although the agency made findings as to the "issue date" of payments from the date of injury through August of 1998, it failed to make the necessary findings as to the dates of mailing or delivery. Accordingly, we reverse and remand to the agency for proper findings as to the due date of each payment and the date each payment was made, a new determination of the amount of the penalty consistent with such findings, and taxation of costs in light of the new findings and penalty determination.
The issue date of each weekly compensation payment is noted on the face of the check. Defendants make no claim that the weekly checks were mailed on their issue dates. Moreover, the record reflects that checks issued by defendants on and after October 5, 1998 were always mailed after their issue dates.
B. Impairment Rating.
CNA cross-appeals from the district court's decision to remand for clarification of the commissioner's analysis regarding the consideration of lay witness opinions as to the extent of petitioner's injury. In the appeal decision, the commissioner granted Dr. Deffer's opinion greater weight and concluded petitioner suffered from a thirty-seven percent disability despite the testimony of Rouse, his girlfriend, and his mother, which suggested a higher impairment rating.
The determination of functional disability is not limited to impairment ratings established by medical evidence. Miller v. Lauridsen Foods, Inc., 525 N.W.2d 417, 421 (Iowa 1994). The workers' compensation commissioner must consider all evidence, both medical and non-medical, to determine the extent of an employee's disability. Terwilliger, 529 N.W.2d at 273.
Again, in reviewing the industrial commissioner's findings of fact in workers' compensation proceedings, the question is not whether the evidence might support a different finding, but whether it supports the findings actually made. Kiesecker v. Webster City Custom Meats Inc., 528 N.W.2d 109, 110 (Iowa 1995). The mere fact we could draw inconsistent conclusions from the same evidence does not mean substantial evidence does not support the commissioner's determinations. Terwilliger, 529 N.W.2d at 271. However, it is the duty of the commissioner to state the evidence relied upon and to detail the reasons for the conclusions reached. Id. at 274. The commissioner's decision must be "sufficiently detailed to show the path he has taken through conflicting evidence," but the law does not require the commissioner to discuss each and every fact in the record and explain why or why not he has rejected it. Id.
Rouse testified to his leg's lack of strength and endurance. Comparing the condition of his leg before and after the injury, Rouse testified that he has a seventy percent loss of function. His girlfriend, Terry Whitaker, testified that Rouse has a sixty to sixty-five percent loss of function since the injury due to pain and difficulty walking. Similarly, Rouse's mother testified that his activities are limited due to pain and a lack of endurance. Dr. Ban and Dr. Deffer offered professional opinions of claimant's disability based on the AMA Guides to the Evaluation of Permanent Impairment. See Sherman v. Pella Corp., 576 N.W.2d 312, 322-23 (Iowa 1998) (recognizing the Guides as an appropriate basis to determine the extent of an impairment). Dr. Ban opined the impairment to claimant's lower extremity was thirty-six percent while Dr. Deffer determined his impairment was thirty-seven percent.
Dr. Ban was claimant's own expert.
We find the commissioner sufficiently detailed the factual-findings framing the appeal decision's reasoning and conclusions of law. The language used in the appeal decision suggests the lay testimony was considered but not afforded the same weight as the professional opinions. Because Dr. Deffer was the treating physician and had the most familiarity with claimant's condition, the commissioner gave his opinion the greatest weight in reaching the thirty-seven percent impairment rating. Assessing the weight of the evidence remains within the agency's exclusive domain. Robbennolt, 555 N.W.2d at 234. Our review of the record reveals substantial evidence supporting the commissioner's conclusion.
C. Costs.
Taxation of costs at the agency level is a discretionary function of the commissioner. Christensen, 554 N.W.2d at 262. In view of our resolution of this case, we vacate the prior order taxing intra-agency costs.
IV. Conclusion.
We reverse the commissioner's decision to award penalty benefits and the amount of the award, and remand to the agency for further findings, a new determination of the penalty consistent with such findings, and taxation of costs. We reverse the district court's decision to remand to the agency for further factual findings regarding the extent of permanent disability. We remand for an order affirming the commissioner's decision regarding the extent of the claimant's permanent disability. The costs of this appeal are taxed one-half to the appellant and one-half to the cross-appellant.
REVERSED AND REMANDED WITH DIRECTIONS.
Vogel, P.J., concurs; Hecht, J., dissents.
I respectfully dissent. I part ways with the majority on the merits of the defendants' cross-appeal. In its discussion of the conflicting evidence on the extent of the claimant's disability, the agency concluded:
Based on the [lay witnesses'] interest in this case and the fact that they have had no medical training or familiarity with the AMA Guides in determining functional impairment of the lower extremity their opinion testimony will be given less weight than that of Dr. Deffer and in particular that of Dr. Ban since Dr. Ban was specifically asked to take into consideration of the functional loss that claimant contends that he now has.
I conclude the agency completely discounted the lay opinions in this case. The agency's mere reference to the lay witnesses' testimony is not tantamount to giving it weight in relation to the relevant expert evidence.
The agency's appeal decision represents that the lay evidence was rejected because of the witnesses' (1) interest and (2) lack of medical knowledge. These reasons effectively vitiate virtually all lay opinion testimony if in conflict with expert evidence of impairment because lay persons with the most knowledge about a claimant's loss of function will be those who know him best-his family and close friends. If the testimony of such persons may be reflexively discounted because of "interest," then of what value is lay evidence in workers' compensation cases? If such lay evidence may be routinely rejected in favor of testimony based upon the AMA Guides, our supreme court's recognition of the legitimacy of lay evidence in workers' compensation cases is rendered illusory.
That the agency discounted the lay evidence relevant to disability in this case because the witnesses had no medical training or familiarity with the AMA Guides is also, in my view, inconsistent with the law. If the agency is permitted to presumptively discount lay evidence because a witness has no medical training or special knowledge of the AMA Guides, lay evidence which conflicts with medical evidence will have no real significance in workers' compensation cases. See Christensen v. Snap-On Tools Corp., 602 N.W.2d 199, 201 (Iowa Ct.App. 1999).
Although I recognize the broad authority of the agency to assign such weight to conflicting lay and expert evidence as it deems appropriate, that authority does not, in my view, permit the agency to presume lay evidence intrinsically suspect (because of "interest") or universally less credible (because not expert). As I conclude the agency made such a presumption and failed to meaningfully weigh the lay evidence against the conflicting medical evidence in this case, I would affirm the district court's ruling on the cross-appeal and remand for further proceedings.