Rusty's Welding Service, Inc. v. Gibson

Tuesday 18th
August, 1998.
Rusty's Welding Service, Inc. and
Harleysville Mutual Insurance Company, Appellants,
against Record No. 2552-97-1
Claim No. 173-33-21
Edward Wayne Gibson, Appellee.
Upon a Petition for Rehearing En Banc
Before Chief Judge Fitzpatrick, Judges Benton, Coleman, Willis,
Elder, Bray, Annunziata, Overton, Bumgardner and Senior Judge Baker*
On July 21, 1998 came the appellee, by counsel, and filed a
petition praying that the Court set aside the judgment rendered herein
on July 7, 1998, and grant a rehearing en banc thereof.
On consideration whereof, the petition for rehearing en banc
is granted, the mandate entered herein on July 7, 1998 is stayed
pending the decision of the Court en banc, and the appeal is
reinstated on the docket of this Court.
The parties shall file briefs in compliance with Rule 5A:35.
It is further ordered that the appellee shall file with the clerk of
this Court ten additional copies of the appendix previously filed in
this case.
____________________
*Judge Baker participated in the decision of this petition
for rehearing en banc prior to the effective date of his retirement on
July 31, 1998 and thereafter by his designation as senior judge
pursuant to Code § 17-116.01.
A Copy,
Teste:
Cynthia L. McCoy, Clerk
By:
Deputy Clerk
-2-
COURT OF APPEALS OF VIRGINIA
Present: Judges Baker, Annunziata and Senior Judge Cole
Argued at Richmond, Virginia
RUSTY'S WELDING SERVICE, INC. AND
HARLEYSVILLE MUTUAL INSURANCE COMPANY
OPINION BY
v. Record No. 2552-97-2 JUDGE ROSEMARIE ANNUNZIATA
JULY 7, 1998
EDWARD WAYNE GIBSON
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
S. Vernon Priddy, III (Sands, Anderson,
Marks & Miller, on brief), for appellants.
No brief or argument for appellee.
Rusty's Welding Service, Inc. (employer) appeals the
commission's award of benefits to Edward Wayne Gibson (claimant).
Employer contends the award is barred by principles of res
judicata and that the award improperly required employer
simultaneously to pay permanent partial disability (PPD) and
temporary partial disability (TPD) benefits. We agree with
employer's claim of res judicata, and reverse.
While carrying a bottle of acetylene on November 12, 1994,
claimant sustained an injury by accident to his back. Employer
accepted the injury as compensable and paid benefits. In
applications filed July 16, 1996 and October 29, 1996, claimant
sought an increase in TPD benefits, an order holding employer
responsible for medical expenses for claimant's left knee, and an
award of PPD benefits for a 40% impairment to claimant's left
leg. All of claimant's requests were based upon the medical
opinion of Dr. Gurpal S. Bhuller.
After an on-the-record review, Deputy Commissioner Gorman
issued an opinion on March 4, 1997, in which he wrote that Dr.
Bhuller did not adequately explain how claimant's leg injury was
caused by the compensable back injury. Deputy Commissioner
Gorman also noted that Dr. Bhuller did not explain that the 40%
leg impairment was permanent or that claimant had reached maximum
medical improvement. He wrote that, "on the evidence before us
we cannot conclude that maximum medical improvement has been
reached and accordingly deny permanent partial disability
benefits at this time." Deputy Commissioner Gorman ordered
employer's insurance carrier to submit a report showing
claimant's earnings and employer's payments to claimant, and
concluded as follows:
Accordingly, the claimant's application is
DENIED insofar as it has requested permanent
partial disability benefits for the left leg
and is DENIED to the extent requesting
payment for medical treatment to the left
knee. In all other respects, the claimant's
application is continued on the Dispute
Resolution Docket in accordance with the
provisions of this opinion with the carrier
to comply with the ORDERS stated above.
Neither party sought review of this opinion.
On April 9, 1997, claimant filed another application seeking
PPD benefits for a 40% impairment in his left leg. In support of
his application, claimant submitted an additional opinion of Dr.
Bhuller explaining claimant's 40% impairment in his left leg and
stating that claimant had reached maximum medical improvement.
-4-
In an opinion filed May 29, 1997, Deputy Commissioner Link
awarded claimant PPD benefits for a 40% loss of use of his left
leg. Deputy Commissioner Link ordered employer to pay claimant a
lump sum of $25,767.70 in accrued benefits.
On review, the commission acknowledged that Dr. Bhuller's
opinion submitted in support of the May 29, 1997 award "was not
based on a contemporaneous evaluation but represented a more
complete discussion of the basis for the disability rating." The
commission also acknowledged that the issue addressed in the May
29, 1997 opinion was identical to the issue addressed in the
March 4, 1997 opinion. The commission held as follows:
[T]he issue was not determined with finality.
The Deputy Commissioner specifically stated
that, based "on the evidence before us,"
permanent partial disability benefits were
denied "at this time" [emphasis added]. The
Commission interprets the Opinion of March 4,
1997, to have left the issue of permanent
partial disability unresolved for future
determination.
The commission also held that it had discretion to order
simultaneous payment of TPD and PPD benefits.
Employer argues that the award of PPD benefits on claimant's
second application is barred by the doctrine of res judicata.
Unlike questions of fact, which are binding on this Court if
supported by evidence, we review questions of law de novo.
Sinclair v. Shelter Constr. Corp., 23 Va. App. 154, 156-57, 474
S.E.2d 856, 857-58 (1996) (citing City of Waynesboro v. Harter, 1
Va. App. 265, 269, 337 S.E.2d 901, 903 (1985)).
-5-
The doctrine of res judicata is applicable to decisions of
deputy commissioners and the full commission. K & L Trucking
Co., Inc. v. Thurber, 1 Va. App. 213, 219, 337 S.E.2d 299, 302
(1985). Generally, "[r]es judicata precludes the re-litigation
of a claim or issue once a final determination on the merits has
been reached." Gottlieb v. Gottlieb, 19 Va. App. 77, 81, 448
S.E.2d 666, 669 (1994) (citing Commonwealth ex rel. Gray v.
Johnson, 7 Va. App. 614, 617-18, 376 S.E.2d 787, 788 (1989)).
Therefore, absent fraud or mistake, "the decisions of the
Commission or its deputy commissioners from which no party seeks
timely review are binding upon the Commission." Thurber, 1 Va.
App. at 219, 337 S.E.2d at 302. There is no question in this
case that claimant's first and second applications were identical
for the purposes of res judicata. In both proceedings, claimant
sought PPD benefits on the basis of a 40% impairment in his left
leg from the same injury, under the same legal theory, against
the same employer, on the basis of the same medical examination.
See Balbir Brar Assocs., Inc. v. Consolidated Trading & Servs.
Corp., 252 Va. 341, 346, 477 S.E.2d 743, 746 (1996) (citing Smith
v. Ware, 244 Va. 374, 376, 421 S.E.2d 444, 445 (1992)).
As the party seeking to assert res judicata, employer must
prove that the deputy commissioner rendered a final opinion in
its favor. Straessle v. Air Line Pilots' Ass'n, Int'l, 253 Va.
349, 353, 495 S.E.2d 387, 389 (1997) (citing Bates v. Devers, 214
Va. 667, 671, 202 S.E.2d 917, 921 (1974)). Generally, a judgment
-6-
is final for the purposes of res judicata when "nothing more is
necessary to settle the rights of the parties or the extent of
those rights." 8B Michie's Jurisprudence, Former Adjudication or
Res Judicata § 13 (1994). The commission "interpret[ed] the
Opinion of March 4, 1997, to have left the issue of permanent
partial disability unresolved for future determination" and,
thus, held that the former adjudication was not final.
We hold that the commission erred. "While proceedings
before the commission must comply with the requirements of due
process, deputy commissioners generally have broad discretion to
adapt the conduct of hearings to the circumstances of the case."
Daniel Constr. Co. v. Tolley, 24 Va. App. 70, 78, 480 S.E.2d
145, 149 (1997) (citing Kum Ja Kim v. Sportswear, 10 Va. App.
460, 470, 393 S.E.2d 418, 424 (1990)). As the commission noted,
Deputy Commissioner Gorman wrote in the body of the opinion that
PPD benefits were denied "at this time." Nevertheless, Deputy
Commissioner Gorman ordered that "claimant's application is
DENIED insofar as it has requested permanent partial disability
benefits for the left leg." This denial of claimant's
application is all the more clear when contrasted with the issue
of TPD benefits, which Deputy Commissioner Gorman ordered
"continued on the Dispute Resolution Docket." Neither party
sought review of the deputy commissioner's decision, and the time
for requesting such a review has expired. See Faison v. Hudson,
243 Va. 413, 419, 417 S.E.2d 302, 305 (1992) ("[A] judgment is
-7-
not final for the purposes of res judicata . . . when it is being
appealed or when the time limits fixed for perfecting the appeal
have not expired."). Thus, the opinion of March 4, 1997 fully
determined the rights of the parties with respect to claimant's
application for PPD benefits for a 40% impairment of his left leg
and was final for purposes of res judicata.
The commission did not find that claimant's second
application was based on a change in condition. Indeed, the
commission found that the medical evidence from Dr. Bhuller which
claimant submitted in support of his second application merely
"represented a more complete discussion of the basis for the
disability rating." Furthermore, our review of the record shows
that claimant's second application was not based upon "a change
in physical condition [or] any change in the conditions under
which compensation was awarded, suspended, or terminated which
would affect the right to, amount of, or duration of
compensation." Code § 65.2-101 (defining "change in condition").
Instead, "it was based upon the same medical results and
findings as the first claim," explained in greater detail.
Childress v. Beatrice Pocahontas Co., 6 Va. App. 88, 93, 366
S.E.2d 722, 724 (1988); cf. Wood v. Allison Apparel Mktg., Inc.,
11 Va. App. 352, 355, 398 S.E.2d 110, 112 (1990) (finding no res
judicata bar where "the applications concerned injuries of
different natures, derived from different circumstances,
predicated on different medical diagnoses, and involving
-8-
different legal foundations"). Claimant's second application
was, therefore, barred by res
-9-
judicata. We reverse the decision of the commission and dismiss
claimant's application. 1
Reversed and dismissed.
1
Given our disposition of employer's res judicata claim, we
do not reach employer's second argument on appeal.
-10-
Baker, J., dissenting.
Because I believe the majority has incorrectly applied the
principle of res judicata, I respectfully dissent. I also
believe the majority erroneously finds that the commission did
not treat claimant's second application as one for a change in
condition and that the application was not based upon a change in
an attending physician's opinion.
In arriving at its decision, the majority concludes that
claimant's second application for a permanent disability rating
was "based upon the same medical results and findings as the
first claim." (Emphasis added). No evidence in this record
proves that the "same medical" evidence was in the first and
second applications for a permanency rating. When the first
application was considered by the deputy commissioner, the
attending physician had expressed no opinion as to whether
claimant had reached maximum improvement from his work-related
injury. Until the deputy or commission has received medical
evidence that the injured employee has attained maximum medical
improvement, the deputy is without authority to make an award for
permanent injury. See County of Spotsylvania v. Hart, 218 Va.
565, 568, 238 S.E.2d 813, 815 (1977). Therefore, on the first
application for an award based on permanency, the deputy
correctly ruled that "at this time" claimant's request had to be
denied because the compensation provided by Code § 65.2-503 is
not awardable "until the injury has reached a state of
-11-
permanency, i.e.[,] maximum [medical] improvement, when the
degree of loss may be medically ascertained." See id.; Nicely v.
Virginia Elec. & Power Co., 195 Va. 819, 823, 80 S.E.2d 529, 531
(1954).
The deputy commissioner's use of the words "claim denied,"
preceded by the phrase "at this time" due to premature
application filed before maximum improvement has been "medically
ascertained," was not a final determination on the merits of the
matter at issue as required for proper application of the
doctrine of res judicata. See Cook v. Clinchfield Coal Co., 215
Va. 599, 212 S.E.2d 263 (1975). In Cook, the record disclosed
that claimant's prior application "was dismissed by the deputy
commissioner because the medical evidence at the hearing before
him failed to disclose the existence of any occupational
disease." The Court held as follows:
Since claimant could not prove his 1968 claim
by medical evidence before the deputy
commissioner, he was not barred from filing
his second claim when he obtained a positive
diagnosis on June 13, 1973 . . . .
Id. at 600, 212 S.E.2d at 264. Similarly, here, claimant was not
barred from filing his second application when he reached maximum
medical improvement. Compare AMP, Inc. v. Ruebush, 10 Va. App.
270, 275, 391 S.E.2d 879, 881 (1990) (noting that res judicata
ordinarily applies to bar relitigation of "[t]he issue of
causation in [industrial accident] cases" because it "is not an
issue subject to change" (second emphasis added)).
-12-
In this case, no evidence concerning maximum medical
improvement was before the deputy at the hearing on the first
application. In its opinion, the commission decided that the
deputy's decision on the first application was not intended to be
a final decision which would support the application of res
judicata as a bar to the second application. If credible
evidence in the record supports that decision, we are required to
affirm the commission's judgment.
The majority fails to give appropriate deference to the
findings of fact implicit in the commission's award. As the
majority asserts, whether res judicata applies is a legal
question subject to de novo review on appeal. See Sinclair v.
Shelter Constr. Corp., 23 Va. App. 154, 156-57, 474 S.E.2d 856,
857-58 (1996). However, we must give deference to any findings
of fact made by the commission in awarding permanent partial
disability if those findings are supported by credible evidence
in the record, regardless of whether contrary evidence exists or
contrary inferences may be drawn. See Code § 65.2-706(A);
Stenrich Group v. Jemmott, 251 Va. 186, 192, 467 S.E.2d 795, 798
(1996); Roanoke Belt, Inc. v. Mroczkowski, 20 Va. App. 60, 68,
455 S.E.2d 267, 271 (1995).
When claimant filed his second application, he attached what
the commission termed "a new medical report from his treating
physician, Dr. Gurpal S. Bhuller," in which Bhuller fully
explained claimant's 40% permanent partial impairment rating.
-13-
Dr. Bhuller's report also contained claimant's statement that his
"symptoms still persist" and Dr. Bhuller opined, for the first
time, that claimant had reached maximum medical improvement.
Therefore, Dr. Bhuller's report of March 12, 1997 provides
credible evidence to support the commission's finding that
claimant's reaching maximum medical improvement was a change in
condition over his status at the time of his prior application,
and such a finding is implicit in the commission's award. See
Sergio's Pizza v. Soncini, 1 Va. App. 370, 375-76, 339 S.E.2d
204, 207 (1986) (holding that commission may treat application
for original injury or disease as application for review on
change in condition, even where application does not use such
terminology, and may conduct such review sua sponte at any time,
subject to due process limitations); see also Code § 65.2-708.
Furthermore, nothing in the record establishes that claimant
had, in fact, reached maximum medical improvement prior to his
first application. Employer, as the party seeking application of
res judicata, bears the burden of proving by a preponderance of
the evidence that an issue previously raised was decided on the
merits. See, e.g., Fodi's v. Rutherford, 26 Va. App. 446, 449,
495 S.E.2d 503, 505 (1998). Dr. Bhuller discussed claimant's
condition with him and confirmed that claimant's "symptoms still
persist[ed]" before Bhuller opined that claimant had reached
maximum medical improvement. For these reasons, I would hold
that credible evidence in the record supports the commission's
-14-
implicit finding that claimant's reaching maximum medical
improvement was a change in condition permitting re-examination
of his entitlement to payment of the rating.
On the issue of accrual of the benefits, however, the
commission said that, "[b]ased on the medical records, the
earliest date on which [claimant] could have reached maximum
medical improvement was August 1, 1996." (Emphasis added). As a
result, it held that "[o]nly the compensation . . . that had
accrued from August 1, 1996, should have been awarded in lump
sum." This statement conflicts with the commission's finding on
the res judicata issue, as discussed above. Therefore, I would
remand the case to the commission with instructions to make
consistent findings on the date of maximum medical improvement as
applied both to the issue of res judicata and the issue of
accrual of the award.
Because I would find the record supports the commission's
finding that the doctrine of res judicata did not apply, I would
reach employer's second assignment of error.
Employer contends the commission erroneously ordered
employer to pay the permanent partial disability benefits
simultaneously with ongoing temporary partial disability
benefits. Code § 65.2-503 provides that "[c]ompensation awarded
pursuant to this section [for a scheduled impairment] . . . shall
be payable after payments for temporary total incapacity pursuant
to § 65.2-500 . . . [but] may be paid simultaneously with
-15-
payments for [temporary] partial incapacity pursuant to
§ 65.2-502." (Emphasis added). Employer contends the statutory
language provides employer, rather than the commission, with the
discretion to make simultaneous or successive payments of
temporary partial and permanent partial disability benefits.
I disagree. The commission has the power under the Workers'
Compensation Act to enter awards granting or denying benefits
under the Act and dictating the terms under which those benefits
will be paid as long as those terms do not conflict with the
requirements of the Act. See, e.g., Code §§ 65.2-101, 65.2-201.
Therefore, the only reasonable construction of Code § 65.2-503,
which provides that payments for a rating "may be paid
simultaneously with payments for [temporary] partial incapacity,"
(emphasis added), is that the commission has discretion to order
such payments. In cases where the commission does not order such
payments, employer would be free to make simultaneous payments
voluntarily.
For these reasons, I would (1) affirm the commission's
authority to order the simultaneous payment of temporary partial
and permanent partial disability benefits and (2) remand the
matter to the full commission with instructions to make
consistent findings on the date of maximum medical improvement as
applied both to the issue of res judicata and the issue of
accrual of the award.
-16-