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COURT OF APPEAL ISSUES DECISION IN NABORS, EXTENDING DOCTRINE OF
DYKES TO INSURED EMPLOYERS ON THE ISSUE OF APPORTIONMENT UNDER LABOR
CODE 4664
By Brian S. Grosenbach, Esq.
Danny Nabors v. Workers’ Compensation Appeals Board; Piedmont Lumber
Co., 8 WCAB Rptr. 10,171 (SRO 122159)
The Court of Appeal, First District, Div. 2, recently issued a
published opinion applying the holding of E & J Gallo Winery v.
WCAB (Dykes) (2005) 134 CA4th 1536, 34 CWCR 1, 70 CCC 1664, and
reversed the en banc decision concerning the method of calculating
permanent disability when the injured worker had a prior industrial
injury for which permanent disability was awarded. Therefore, when
an employee sustains multiple industrial injuries, the employee is
entitled to compensation for total disability above any percentage
of permanent disability previously awarded. This is accomplished by
the application of the Fuentes formula C: dollar value of
previous award, subtracted from the dollar value of total current
permanent disability.
The Court of Appeal quoted from Dykes:
“Turning its attention to the meaning of the new apportionment
provision, the court concluded the plain language of section 4664,
subdivision (1) (ante, pp. 2-3) means that “[a] n employer is
liable for the direct consequences of a work-related injury, nothing
more and nothing less.” Furthermore, “section 4664 contemplates
accumulating multiple disability awards rather than subtracting
percentage levels of disability.” But the court noted that while the
new statues, in conjunction with the permanent disability schedule
and the life pension provision, may be interpreted to permit several
different approaches to apportioning liability, yielding quite
disparate results, the Legislature did not specify any particular
method of calculating an award.
Guided by the specific legislative mandate of section 4664,
subdivision (a), as well as the overriding principle of liberal
construction of workers compensation laws for the benefit of injured
workers (section 3202), and mindful of the exponentially progressive
nature of the permanent disability tables, which serve to compensate
employees with higher levels of permanent disability “in greater
proportion” to those with lower levels, the court concluded that
only formula C ensures both that the employee is adequately
compensated and that an employer is liable only for the percentage
of disability directly caused by the current injury. In other words,
an employer is liable for that part of a worker’s overall disability
that exceeds his prior disability level.”
In this particular case, applicant Danny Nabors sustained an
admitted industrial injury on May 2, 1996 to his low back and
radiating pain to both lower extremities, while employed by Piedmont
Lumber & Mill Company. On August 2, 2001, applicant received a
stipulated Award of 49% permanent disability, equivalent to
$42,476.00, based on a preclusion from substantial work. During the
period ending August 19, 2002, applicant sustained a cumulative
industrial injury to his back and lower extremities while employed
by Piedmont. On September 29, 2004, the issues of permanent
disability and apportionment proceeded to trial before WCJ Mark
Fudem. WCJ Fudem then issued rating instructions: “Work preclusions
limiting applicant to sedentary work and need for a cane, Apportion
49% adjusted permanent disability per the August 2, 2001 Award.”
Subsequently the disability evaluator provided a recommended rating
of 31% permanent disability, amounting to total indemnity of
$22,610.00, on November 29, 2004 and served the same upon all
parties. The recommended rating was derived from an overall rating
of 80% permanent disability, based upon the work preclusions for
applicant’s low back limiting him to sedentary work and requiring
use of a cane from which the applicant’s prior Award of 49% was
subtracted. On December 24, 2004, WCJ Fudem issued his decision
finding 31% permanent disability after apportionment.
Applicant sought reconsideration contending that he should receive
an ward of 80% permanent disability for his injury, equivalent to
$118,795.00, less the amount of $42,476.00 for the prior 49%
permanent disability award. The Appeals Board in a 4-2 en banc
decision affirmed WCJ Fudem’s findings.
However, as referenced above, the Court of Appeal reversed the en
banc decision and remanded the case for recalculation of the
permanent disability benefits, relying on the 5th District Court of
Appeal opinion in Dykes. The Court of Appeal found no reason
why the Dykes rationale should not apply to a case of
successive injuries with the same employer insured by different
carriers. The Court of Appeal noted that “the Dykes court
expressly limited its analysis to the “narrow contest” in which “the
injured employee received a prior disability award while working for
the same self-insured employer.” The Court found this to be a
distinction without a difference.
This decision is likely to have an immediate effect, in view of the
large number of cases on the issue where writs have been granted and
the matters are pending at the appellate level.
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