Solomon Motor Company v. Earnest Dean:

In this opinion released on December 19, 2008, the Alabama Court of Civil Appeals considered a trial court’s decision to sidestep the schedule set forth in §25-5-57(a)(3)a and award permanent and total disability benefits for a right knee injury. At trial, the court agreed with the plaintiff’s contention that his compensable right knee injury extended into and effected the efficiency of the plaintiff’s left knee and back. In reversing the trial court, the Court of Civil Appeals noted that the evidence only established a temporary problem with the plaintiff’s back. After a course of medication, the back problem resolved. In order for a trial court to be able to consider an otherwise scheduled member outside of the schedule, the effects of the injury to other parts of the body must be permanent. The court further noted that, even if you accept the plaintiff’s contention that his left knee problem was caused by his right knee injury, this would not remove the injuries from the schedule. The schedule set forth in §25-5-57(a)(3)a provides for the compensation of multiple members of the same class (i.e. both arms or both legs).

Greater Mobile Chrysler-Jeep, Inc. v. Charles Atterberry:

In this opinion released on December 19, 2008, the Alabama Court of Civil Appeals considered an employee’s claim of occupational disease. At trial, the employee presented evidence that his interstitial lung disease and adult respiratory distress syndrome was caused by exposure to chemicals at work. the trial court ruled in favor of the plaintiff on the limited issue of compensability. The plaintiff had not yet reached MMI and so the issue of disability remained open. Although the employer initially filed a petition for writ of mandamus, it was converted and treated as a timely appeal. In reversing the trial court’s finding of compensability, the Court of Civil Appeals held that the employee failed to identify the necessary causal link between his condition and the chemical exposure for his condition to be considered an occupational disease. The Court further held that the plaintiff failed to establish by clear and convincing evidence that he suffered a non-accidental injury because he could not prove that he was exposed to chemicals materially in excess of what ordinary people are exposed to in their everyday lives.

BACKGROUND:  On July 11, 2005, the Centers for Medicare and Medicaid Services (CMS) released its sixth policy memorandum with answers to frequently asked questions (FAQ’s) on Workers’ Compensation Medicare Set-Aside Arrangements. The fifteen new FAQ’s clarified two existing policies; amended or replaced three previously published FAQ’s; and introduced ten new CMS policy statements. Among the new statements was CMS’ policy that CMS would not compromise the amount projected for future medical expenses. CMS’ position was that the "compromise" language in 42 C.F.R. §411.47 only applied to overpayment of past medical expenses.

In 2007, a company and a law firm that provided consulting services for the settlement of workers’ compensation claims brought a declaratory judgment action against the Secretary of the U. S. Department of Health and Human Services and the Administrator of CMS (Protocols v. Leavitt). The law suit claimed that the above referenced memorandum opinion misinterpreted the Medicare statute and regulations and exposed the plaintiffs to unexpected liabilities arising out of settlements they had previously structured. The U.S. District Court for the District of Colorado granted the defendants motion for summary judgment because the plaintiffs lacked constitutional standing (they had not suffered the requisite injury).

HOT OFF THE PRESS:  On December 11, 2008, the 10^th Circuit Court of Appeals issued an Order reversing the district court. In support of its opinion, the circuit court noted that the only issue relevant to standing was whether CMS is now taking a position that is contrary to the plaintiffs’ past settlement practice thus exposing them to possible (contingent) liability.

I will continue to monitor this case and post any new developments.

MasterBrand Cabinets, Inc., f/k/a NHB Industries, Inc. v. Nacola Ruggs:

In this opinion released on December 12, 2008, the Alabama Court of Civil Appeals considered whether the trial court properly enforced the double penalty provision set forth in §25-5-8(e) which penalizes employers for either not properly maintaining workers’ compensation insurance or not being an authorized self-insurer. the Alabama Supreme Court previously determined that a motion seeking the double indemnity penalty provision was not subject to the time limitations set forth in Rule 59 of the Alabama Rules of Civil Procedure. The Court of Civil Appeals affirmed the trial court’s decision based on the testimony of the general counsel for the Alabama Department of Industrial Relations who stated that MasterBrand did not have insurance and was not an authorized self-insurer at the time of the accident.

As a practice pointer, it may be prudent to secure an early stipulation on the issue of insurance so there are no surprises at trial. If the double indemnity penalty is an issue then it should be taken into account when evaluating the case for possible settlement.

Child Day Care Association v. Victoria Christesen:

In this opinion released on December 12, 2008, the Alabama Court of Civil Appeals upheld the trial court’s decision not to apply the §25-5-57(a)(3) schedule to a leg injury and assign a permanent and total award. The evidence at trial revealed that the plaintiff initially incurred an ankle injury. The plaintiff then sustained a knee injury during physical therapy. The plaintiff testified that she suffered debilitating pain and that the effect of her injury extended into her back. Her physician testified that the effects of the plaintiff’s ankle and knee injuries extended into her back thus affecting the efficiency of her back by limiting mobility and range of motion. In Ex Parte Drummond Co., 837 So.2d 831 (Ala. 2002), the Alabama Supreme Court stated that the schedule is not exclusive if the effects of the loss of the member extend to other parts of the body and interfere with their efficiency. Applying the Drummond test to the evidence, the Court of Civil Appeals affirmed the trial court. The Court declined to address the issue of debilitating pain.

The schedule continues to erode away before our very eyes. What is the point of even having a schedule if the employee simply has to follow the Drummond blue print and claim that other parts of the body are somehow affected? The Court in this case did not even reach the issue of debilitating pain which is yet another means of circumventing the schedule. It makes it difficult to evaluate these cases and resolve them when the test is so dependent on the subjective complaints of the employee. There would be a lot less litigation if the courts used a strict application of the schedule.

Ex parte Saad's Healthcare Services, Inc.

In this opinion released on December 5, 2008, the Alabama Supreme Court held that the Alabama Court of Civil Appeals was correct in determining that an employee was not disqualified by the exclusion found in § 25-5-57(a)(4)d from being considered permanently and totally disabled based on her refusal of psychological and psychiatric treatment after she reached MMI. The subject exclusion states: "Any employee whose disability results from an injury or impairment and who shall have refused to undergo physical or vocational rehabilitation ... shall not be deemed permanently and totally disabled." In support of its opinion, the Court explained that because the post-MMI treatment the employee refused was not offered for the purpose of restoring her physical function or her ability to engage in gainful employment, but was instead offered to treat her mental impairments, that treatment was not "physical or vocational rehabilitation" within the meaning of the exclusion found in § 25-5-57(a)(4)d.