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Caldwell v. County of Mercer


October 26, 2007


On appeal from State of New Jersey Division of Workers' Compensation, Department of Labor, Petition No.: 2005-23079.

Per curiam.


Argued September 11, 2007

Before Judges Axelrad and Payne.

Petitioner, formerly employed by Mercer County's Board of Social Services as a Human Services Specialist II whose duties included making welfare eligibility determinations for the Board's clients, appeals from a denial of medical and temporary disability workers' compensation benefits for an aggravation of pre-existing depression on the grounds that the psychiatric injury did not arise out of or in the course of his employment as required by N.J.S.A. 34:15-30 and N.J.S.A. 34:15-7.

On April 25, 2005, petitioner was informed by a supervisor, in a meeting that occurred in the presence of petitioner's union representative, that a former welfare benefits client had charged him with kidnapping and rape. Following the meeting, and while an investigation was occurring, petitioner was denied further client contact and confined to administrative duties, to the alleged ire of his colleagues, who were required to shoulder the extra work. On June 14, 2005, petitioner was served with a preliminary notice of disciplinary action, and at his request, a hearing was conducted before an internal Board of Social Services hearing officer on June 23, 2005, at which the complainant testified, as well as petitioner, the person investigating the complainant's allegations, and various other witnesses.

At the hearing, the complainant testified that petitioner had enticed her to come to a VFW hall in Ewing, on Sunday, February 13, 2005, with papers necessary to perfect her application for food stamps. Upon arrival and sign-in, petitioner, who was serving as a bartender at the hall, served complainant with a strong apple martini, and later gave her the keys to his Volvo, requesting that she wait for him in his car, which she described as dark and old. Complainant did so, and after being driven by petitioner to a KFC restaurant for food, petitioner drove her to Mount's Motel near the Brunswick Circle, where he forced her to have sex, leaving $20 on the bed after the assault had occurred. Complainant stated that, while in the motel, petitioner showed her a scar on his leg that he claimed had resulted from a vasectomy. Complainant's application for food stamps was denied a few weeks later, and in April, complainant reported the sexual assault to the Board at the urging of her mother. She did not report it to the police.

Petitioner denied complainant's allegations, stating that they had been fabricated as revenge following petitioner's determination that claimant sought to commit welfare fraud. He stated that he had never seen a client outside of the office, and that he had never had a sexual relationship with a client. However, petitioner confirmed that he had served as a bartender at the Ewing VFW hall from 6:00 p.m. to 1:00 a.m. on the night in question. He denied having a vasectomy, but confirmed that he had a scar on his right knee. Additionally, he admitted that he had visited Mount's Motel approximately eighteen times in the prior two and one-half years, although he claimed that he did so with his girlfriend.

During cross-examination, petitioner admitted that he had been disciplined for stating in writing that he had a valid New Jersey driver's license, when it was in fact suspended. He also admitted that he had been disciplined for visiting a client at her home, while not on agency time, and for taking possession of the client's passbook, which he subsequently lost. He stated that a further charge against him for visiting another client's house on two occasions and calling her during the evening hours was not substantiated.

Petitioner conceded that he owned a Volvo. He could not explain how the complainant would have known the make of his car, other than by seeing him in Trenton, and he could not explain how she knew of his work as a VFW bartender.

Testimony by the Board's investigator established that complainant had sought compensation for speaking to him. It also established the investigator's inability to confirm the complainant's presence at the VFW hall, because sign-in sheets maintained for the evening did not disclose her name. However, the investigator did not know whether the sign-in sheets, maintained by the bartenders, were complete. The investigator additionally was unable to confirm the couple's presence at the motel. However, he was told by its proprietor that a person identifying himself as "Junior" had signed in that night, as he frequently did. Petitioner's name is Amos R. Caldwell, Jr.*fn1 His use of Junior as a nickname was disputed.

During the course of the hearing, an armed guard escorted petitioner through the building and to and from its rest room. At the hearing's conclusion, the hearing officer reserved decision.

Petitioner did not return to work. On June 24, 2005, petitioner was seen by his treating internist, Dr. Mariam Maniya, for, among other things, depression reported by the doctor to have been caused by the death of petitioner's son in 2001. The doctor referred petitioner to psychiatrist Prakash Amin, M.D., for evaluation, and excused petitioner from work for three weeks.

Petitioner saw Dr. Amin on July 6, 2005, at which time he complained of "false allegations against [him]." Dr. Amin diagnosed petitioner as suffering from "major depression, recurrent, moderate" along with "panic disorder without agoraphobia." Dr. Amin saw petitioner again on July 21 and on August 1, 2005, and ordered that he remain out of work until September 1, 2005.

In the meantime, in a memorandum dated July 5, 2005, the hearing examiner sustained the charge against petitioner of conduct unbecoming a public employee as set forth in N.J.A.C. 4A:2-2.3(a)6, and he recommended petitioner's dismissal. The hearing examiner found that the testimony offered by the complainant was credible, and that it remained consistent with her prior statements and upon cross examination. With respect to petitioner, the hearing examiner found:

By his own admission, Mr. Caldwell related that similar charges had been brought by other clients against him in the past. A review of his disciplinary record indicates that this was indeed the case. Though charges in all but one of these cases were either dismissed, were not pursued or unresolved by the clients' unwillingness or inability to continue, there appears to be disturbing similarities in their testimony regarding Mr. Caldwell's alleged inappropriate conduct, and that of the client in this matter.

This further lends credibility to client's testimony since she could not have known details of the past charges and allegations. It also establishes that there appears to be a continuing pattern of improper conduct, and possible predatory behavior exhibited by Mr. Caldwell's abuse of his official agency position to see clients outside of normal work hours for the purpose of allegedly conducting agency business.

A final notice of disciplinary action, issued on July 7, 2005, ordered petitioner's removal from employment, effective August 1, 2005. An appeal from that decision was filed and remains unresolved.*fn2

During the period from June 24, 2005 to December 22, 2005, petitioner received State temporary disability benefits. Petitioner remained out of work through January 2006.

While receiving temporary disability benefits, petitioner sought workers' compensation in a pro se petition that claimed psychiatric disability as the result of the client's allegedly false complaint. On November 23, 2005, following retention of counsel, a motion for medical and temporary workers' compensation benefits was filed on petitioner's behalf. In support of his claim, petitioner offered the January 11, 2006 report of Dr. Amin, who confirmed the work-related aggravation of petitioner's pre-existing depression. Jon Courtney, M.D., respondent's examining psychiatrist, concurred, stating in his February 10, 2006 report that petitioner's "psychiatric problems were markedly aggravated by a complaint that was made against him on 4/25/2005."

In the workers' compensation proceeding, petitioner claimed that his psychiatric disability had arisen as the result of the respondent's post-complaint determination to bar him from client contact, which caused petitioner to be shunned by co-workers who assumed his employment duties, and as the result of the embarrassment of being observed under armed guard on the day of his disciplinary hearing. Following a testimonial hearing, the workers' compensation judge found petitioner's psychiatric complaints did not arise out of and in the course of his employment as required by N.J.S.A. 34:15-30 and 34:15-7.

In a thoughtful written decision issued on June 23, 2006, the judge reiterated his refusal to relitigate the disciplinary matter that had resulted in petitioner's termination for engaging in conduct unbecoming a public employee, when he allegedly solicited sex in return for an agreement to "take care" of a client's food stamp application. Additionally, the judge rejected respondent's argument that petitioner's injury was the result of conduct that was outside the scope of his employment, finding that the injury did not arise from the solicitation of the complainant, but from workplace discipline. He observed:

Clearly, had the complainant blinded Petitioner with a punch when approached, his injury would not be compensable. However, as Petitioner contends, the injury in this instance was the result of Respondent's handling of the disciplinary process. The injury is therefore not, ab initio, non-compensable.

The judge also rejected the applicability of Goyden v. State Judiciary, 256 N.J. Super. 438 (App. Div. 1991), aff'd o.b., 128 N.J. 54 (1992), a case holding, under somewhat similar facts, that workplace stress causing psychiatric injury is compensable only if the conditions, objectively viewed, are in fact stressful. He found that, unlike the petitioner in Goyden, petitioner's "psychiatric problems were aggravated by a specific event, namely the disciplinary proceedings and not, as in Goyden, the general stress of the job, coupled with his fear of termination."

However, the judge found petitioner's circumstances to be analogous to those of the petitioner in Cairns v. City of East Orange, 267 N.J. Super. 395 (App. Div. 1993), a case in which the petitioner's emotional response to the receipt of a layoff notice was deemed non-compensable, despite his apparent ability to satisfy the threshold requirement of demonstrable medical evidence of psychiatric injury, because the risk of layoff was "neither peculiar to the employment, nor essentially related to the work or the nature of the work," id. at 401, but rather a risk, arising from the status of the economy, that was common to all employment. Ibid.

In a motion for reconsideration, petitioner urged the applicability of Prettyman v. State, 298 N.J. Super. 580 (App. Div. 1997), a case in which we found to be compensable those psychic injuries sustained by an exemplary employee interrogated by two State Troopers for two and one-half hours, photographed, and threatened with imprisonment of five to seven years after a videotape revealing her to be looking into a co-employee's desk drawer for a missing office key was mistakenly interpreted as evidence of theft of a valuable bracelet from the drawer. The workers' compensation judge rejected petitioner's position, distinguishing Prettyman on the grounds that the petitioner, there, was performing her job duties when accused, whereas the conduct of which petitioner was charged by complainant, here, was not susceptible of an innocent interpretation. Further, the judge found that Prettyman had no reason to expect harsh treatment, whereas, as the result of petitioner's disciplinary history, the disciplinary process applied to petitioner could not have been unanticipated.

On appeal, petitioner argues that the workers' compensation judge (1) misapplied the law by failing to recognize Prettyman as precedent in his case, (2) dismissed the opinions of the treating doctor, Dr. Amin, and respondent's medical expert, Dr. Courtney, (3) inappropriately relied on the merits of the administrative proceedings by determining petitioner did what he was accused of doing, and (4) extended the limitation of benefits violating the Workers' Compensation Act.

Our review of the record and relevant legal principles suggests that the workers' compensation judge reached the correct result, which for reasons that we will explain, we conditionally affirm. However, we base our decision on grounds different from those adopted by the workers' compensation judge, determining that he unnecessarily divorced the disciplinary process, which petitioner claimed to have been the root cause of his injury, from the conduct precipitating the discipline. See Isko v. Planning Bd. of Tp. of Livingston, 51 N.J. 162, 175 (1968) (an order may be affirmed if the correct result is reached, regardless of the reasoning employed).

N.J.S.A. 34:15-7 provides that workers' compensation shall be paid for personal injuries to a worker "by accident arising out of and in the course of employment." N.J.S.A. 34:15-30, while providing exceptions to the requirement for compensation, includes the same requirement that, in order for compensation to be ordered, the personal injuries or occupational disease claimed by the petitioner must arise "out of and in the course of his employment." In Cairns, we adopted as a "satisfactory outline of [the] parameters" of the definition of "arising out of employment" the following statement set forth in Furdo v. Scannell China Co., 17 N.J. Super. 339, 347 (Law Div. 1952):

An accident arises out of the employment when it is something the risk of which might have been contemplated by a reasonable person when entering the employment as incidental to it. A risk is incidental to the employment when it belongs to or is connected with what a workman has to do in fulfilling his contract of service.

Moreover, a risk may be incidental to the employment when it is either an ordinary risk directly connected with the employment, or an extraordinary risk which is only indirectly connected with the employment, owing to the special nature of the employment. [Cairns, supra, 267 N.J. Super. at 399.] Nonetheless, we recognized, in the context of injuries allegedly arising from receipt of a layoff notice, that: "Whether a layoff notice would satisfy the requirements of the definition of 'arising out of employment,' most likely depends on underlying policy considerations rather than the clear language of the Act." Ibid. (citing Williams v. Western Elec. Co., 178 N.J. Super. 571, 588 (App. Div. 1981), certif. denied, 87 N.J. 380 (1981)). We then discussed Walck v. Johns-Manville Prods. Corp., 56 N.J. 533 (1970), a case in which compensation was denied to an employee who suffered a fatal heart attack allegedly as the result of his feeling of insecurity about his job and fear that he might lose it, on the grounds that the heart attack did not arise from a risk of the employment and that a finding that it was compensable would make employers the insurers against job insecurity. We also discussed Goyden, supra, in which we found no objective evidence of work-related stress sufficient to lead to compensable injury. We concluded from those decisions that the appropriate focus in matters such as layoffs was on whether the precipitating events were "peculiar" to the workplace or "held some 'essential relation to the work or its nature.'" Cairns, supra, 267 N.J. Super. at 400-01 (quoting Goyden, supra, 256 N.J. Super. at 458 and Walck, supra, 56 N.J. at 556). We found that neither requirement had been met by petitioner Cairns.

In doing so, we recognized that "drastic personnel action may in certain circumstances result in adverse mental and even physical consequences." Id. at 401. But we held:

Nonetheless, in the absence of evidence of a clear legislative intent to require payment of workers' compensation benefits for disability caused by varying personalized responses of employees to bona fide personnel decisions that alter an employee's work status, we are constrained to conclude that the burden of providing compensation to such employees may not be imposed upon an employer. Even where instances of such harm may be predictable, the stress or trauma caused by such personnel decisions is an ordinary part of life and is not so peculiar to the specific employment as to be deemed to arise out of the employment. [Ibid.]

In essence, we found the risk of layoff to be so universal and an emotional response to a layoff notice to be so predictable that this particular cause and effect relationship could not have been envisioned to be compensable.

Respondent has invited us to accept the conclusion that petitioner was properly disciplined for unbecoming conduct and to draw an analogy between the workplace processes of layoff, at issue in Cairns, and discipline, at issue here, in affirming the conclusion of the workers' compensation judge that petitioner was not entitled to compensation. We do not find the analogy to be sufficient to adopt Cairns in this context. Employee conduct precipitating the stressor, discipline, is a markedly different causal factor from an employer's economic determination that layoffs are required. Such employee conduct, or the cause of the discipline, as the case may be, in fact is likely to have arisen in a specific work context and must be examined with particularity to determine its work relatedness. Here, that determination is made more difficult because petitioner's appeal from the disciplinary determination in his case remains undecided.

A similar factual circumstance arose in the California case of Pacific Tel. and Telegraph Co. v. Workers' Comp. Appeals Bd. and Blackburn, 169 Cal. Rptr. 285 (Cal. App. 1980). In that case, an advertising salesman sought compensation for psychiatric injury resulting from the stress of an accusation by his employer that he had forged signatures on advertising contracts, and from the stress of the subsequent investigation of that accusation and the termination of his employment. In a split vote, the Workers' Compensation Appeals Board ruled that a factual finding as to the worker's guilt or innocence was unnecessary to a resolution of his compensation case, since in any event, the injuries arose in the course of his employment. Id. at 286-87. The California Court of Appeal disagreed, holding that a determination of the existence or nonexistence of criminal conduct was essential to a finding with respect to compensability. Id. at 287. It stated:

We deem it beyond dispute that if applicant had not forged any signatures that any injury to his emotional state would be compensable under the Workers' Compensation Act. This would be true even assuming Pacific Telephone had acted reasonably and properly in its accusation, investigation and discharge of applicant; the resulting psychiatric conditions would be concerned with applicant's underlying legitimate conduct (entering into advertising contracts with customers) which, in fact, had been in the course of his employment. . . . The question here then becomes one of whether, if applicant did indeed forge customer signatures, his psychiatric condition is taken outside the scope of compensability under the Workers' Compensation Act. [Id. at 287-88.]

The court then drew a distinction between the performance of a duty in an unauthorized or even illegal manner, such as failing to follow rules or instructions or running a red light while making a delivery, and an unauthorized departure from the course of employment by acts such as forgery, finding the former compensable, whereas the latter was not. Id. at 288-89. Although the court recognized, as in the present case, that the petitioner's claim was that his injury flowed from the disciplinary process, not the allegedly illegal act occurring outside the scope of his employment, the court held that, if criminal activity had in fact occurred, the discipline flowing from it was not independent, but incidental to that activity, and thus was non-compensable. Id. at 289. It thus remanded the case to the Workers' Compensation Board, placing the burden of proof on the employer to establish by a preponderance of the evidence that petitioner had committed forgery. Ibid.

We find the reasoning of the court in Pacific Tel. with respect to eligibility for workers' compensation benefits to be compelling, and to establish the proper framework for analysis of the present matter. Like the claimant in Pacific Tel., if petitioner's injuries arose because he was wrongly accused in retaliation for his denial of welfare benefits to the complainant, they arose from a risk inherent in a job requiring a determination of another's entitlements. In this circumstance, petitioner's resulting psychiatric condition essentially could reasonably be found to have arisen from his underlying legitimate and work-related conduct, and he would be is entitled to compensation, regardless of the reasonableness of the steps taken by the Board to protect the public from petitioner's allegedly untoward conduct while its investigation continued and thereafter. In this respect, complainant's case would indeed resemble Prettyman. See 298 N.J. Super. at 592 (distinguishing Cairns on the ground that it is not reasonable to conclude that being the subject of a hostile investigation is an expected condition in all workplaces) and at 594 (refusing to divorce the petitioner's work-related conduct in searching the desk for a key from the police's subsequent interrogation). An opposite conclusion would follow upon a definitive finding of fault.

Although we have chosen to adopt the reasoning of Pacific Tel. in determining the issue of compensability, in the circumstances presented, we see no need to adopt its procedures. We agree with the workers' compensation judge in the present matter that relitigation of the disciplinary charges against petitioner in his workers' compensation case while his discipline remained on appeal would be unwise, since adoption of that procedure would permit a collateral attack upon the discipline and could result in inconsistent judgments relating to the substance of the charges. We conclude that it is proper under our workers' compensation laws for a decision on an award of medical and temporary disability benefits to be reached on the basis of the record existing at the time of the workers' compensation hearing, so long as due process has been satisfied at the disciplinary level, and so long as the workers' compensation proceeding can be reopened, if warranted, upon final resolution of any disciplinary appeals. Cf., e.g., State v. Haliski, 140 N.J. 1, 11 (1995) and State v. Bey, 96 N.J. 625, 629 (discussing use of a prior conviction for murder in the penalty phase of a capital prosecution prior to completion of appeals from the prior conviction), clarified, 97 N.J. 666 (1984); see also N.J.S.A. 2C:11-3c(4)(a) (permitting such use).*fn3

We recognize that permitting a workers' compensation proceeding to occur before the disciplinary proceedings have been finally resolved may, as here, result in a denial of medical and temporary disability workers' compensation benefits to the injured petitioner. However, the existence of benefits pursuant to the State's Temporary Disability Benefits Law, N.J.S.A. 43:21-25 to -56, utilized by petitioner in this case, provides at least partial relief to him in the circumstances.*fn4

The Temporary Disability Benefits Law specifically provides for payment when "a claimant's claim for compensation for temporary disability, under the provisions of subsection a. of R.S. 34:15-12, is contested, and thereby delayed," although reimbursement is required if workers' compensation is awarded. N.J.S.A. 43:21-30. Similarly, the Workers' Compensation Act recognizes this alternative means of relief, and provides for reimbursement to the State when it is later determined that workers' compensation was the appropriate remedy. N.J.S.A. 34:15-57.1. Thus, circumstances such as those experienced by petitioner have been foreseen, and a legislative remedy has been crafted. Further, if petitioner can offer proper proof that the Board unreasonably or negligently delayed or refused to pay him temporary disability compensation, petitioner may be entitled to the twenty-five percent penalty provided by N.J.S.A. 34:15-28.1.

Viewing the record as it presently stands, we are satisfied that, if the disciplinary action taken against petitioner is sustained or if the employer otherwise is found to have met its burden of proof of petitioner's misconduct, then petitioner was properly denied medical and temporary disability benefits under the Workers' Compensation Act in this case. Although we are not in complete agreement with the legal reasoning of the workers' compensation judge, we discern ample credible evidence in the record to support the conclusion that petitioner engaged in conduct wholly unrelated to his employment, that the disciplinary procedures employed by the Board were incidental to that conduct, and that although petitioner's largely conceded psychiatric disability flowed from the discipline,*fn5 it was nonetheless non-compensable. Close v. Kordulak Bros., 44 N.J. 589, 598-99 (1965); Prettyman, supra, 298 N.J. Super. at 590-91.

If the result of the disciplinary action against petitioner is reversed, petitioner may reopen his workers' compensation case, at which time that final disciplinary decision and its basis can serve as further evidence of relevance to a determination of petitioner's eligibility for temporary disability benefits.

The judgment of the workers' compensation court is affirmed, subject to the conditions specified in this opinion.

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