March 20, 2008
LAWRENCE BROWN, PETITIONER-RESPONDENT,
MONMOUTH CROSSING/CENTRA STATE, RESPONDENT-RESPONDENT, AND SECOND INJURY FUND, RESPONDENT-APPELLANT.
On appeal from the New Jersey Department of Labor, Division of Workers' Compensation, 2002-3816.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued February 26, 2008
Before Judges Winkelstein and LeWinn.
The Second Injury Fund appeals from a final judgment of the Division of Workers' Compensation holding the Fund liable for fifty percent of petitioner Lawrence Brown's permanent total disability. We reverse.
Petitioner is sixty-four years old. Among other jobs, he was employed as a part-time bus driver for Monmouth Crossing from 1997 through December 2001. While so employed, he sustained a compensable accident to his left knee on October 28, 2000. He nevertheless continued his employment until December 2001, when he left his job after losing vision in his right eye.
In 2002, petitioner filed a claim for workers' compensation benefits based on his knee and leg disability. He did not seek benefits for his eye disorder. The workers' compensation court entered an order on June 11, 2003, authorizing a permanent disability award of thirty percent for petitioner's left leg and knee, with a "credit for 5% of the leg."
In March 2005, petitioner filed an application for review or modification of the June 2003 award, and in November 2005, he petitioned for Second Injury Fund benefits. The workers' compensation court bifurcated the case, and the trial between petitioner and Monmouth Crossing commenced on April 26, 2006, and continued on June 28, 2006; September 20, 2006; and October 6, 2006. The Fund was not a party to this trial, during which the following facts were elicited.
Petitioner continued to receive treatment for his left knee, which caused him difficulty walking. As a result of favoring his left knee, he developed a right knee injury, a torn meniscus, for which he required two surgeries. He suffers from constant pain and swelling in his right knee and wears braces on both legs.
Dr. Floyd Krengel, D.O., who examined petitioner in 2005, diagnosed him with left and right knee disorders. He estimated petitioner's disability at sixty-six and two-thirds percent on the left leg and fifty-five percent on the right leg. He opined that the petitioner was "100 percent totally and permanently disabled" based on his knee disorders and his "other disabilities, pulmonary and eye, which are most serious."
As Dr. Krengel observed, petitioner has a history of other medical conditions. In the early 1990's, he began having problems with his lower back. He has asthma dating back to 2000, and an enlarged heart and high blood pressure that require medication. He had surgery in the late 1990's to remove his thyroid and requires daily medication to treat that condition. As noted, in December 2001 petitioner was found to have lost his vision in his right eye. It is the date of the onset of that condition that is primarily at issue in this appeal.
Dr. Warren Klein, a board certified ophthalmologist, testified that petitioner was diagnosed with a chronic branch vein occlusion of the right eye on December 1, 2001, which required surgery. A branch vein occlusion is the "closing of the main veins in the retina related to [sic] usually hypertension." Symptoms are "visual disturbances. . . . He could see spots. He could see floaters. He would have [more difficulty] using the eye. If his eye waters, it's more from strain than anything else." Dr. Klein opined that petitioner was one hundred percent disabled in the right eye, and seventy-five percent disabled in both eyes because of cataracts in the left eye. As to the onset of the disabling right eye disorder, Dr. Klein testified that:
The records that I have indicate that [petitioner] had some visual complaints in his eyes dating back to 1997, but this vein occlusion is a result of hypertension. I have retinopathy that occurs spontaneously.
I mean, basically he didn't have a retinal branch vein occlusion that was decompensating his vision in 1997. Basically the symptomology started before. All we know is that in the 12-1-01, that was when the doctor noted a chronic branch occlusion of the right eye. I don't know exactly when it started.
Dr. Klein was of the opinion that, based solely on petitioner's knees, he was not totally and permanently disabled because he could perform sedentary activities. The doctor did not testify as to what extent petitioner's eye disorder contributed to his overall disability.
On November 17, 2006, the compensation court found that petitioner was totally and permanently disabled. The court made the following findings:
The overall impairments that this man presents are extensive. Keeping in mind the requirements of a bifurcated trial or bifurcated Fund trial, there is no question this man had an abundance of prior impairment which include macular damage, complete loss of vision of his right eye, some before 2000, chronic asthma which required the use of an inhaler prescribed by his treating doctor before the accident. . . . Eventually he required a bilateral knee replacement. . . . He can walk with some difficulty.
I find Petitioner totally disabled. I will not apportion between the Respondent and the Fund at this time.
The matter will be set down for a hearing to determine apportionment.
Accordingly, on November 20, 2006, the court ordered, among other things, that "this matter shall be relisted with the Second Injury Fund for a determination as to apportionment between the parties."
The Fund was represented for the first time at a court proceeding on December 8, 2006. The Deputy Attorney General assigned to represent the Fund argued against Fund liability, asserting that the "most glaring problem" was that although petitioner suffered his compensable injury in October 2000, no evidence had been presented to quantify the degree of his eye disability prior to that date. She also pointed out that it was not until December 2001, after learning for the first time that he suffered from a serious eye disorder, that petitioner left his employment.
At the next court proceeding, counsel for the Fund argued that petitioner's "quantum of disability" as to his eyes prior to the accident needed to be determined, and accordingly, she requested that she be permitted to cross-examine Dr. Klein about that issue. The court denied that request, but allowed her to cross-examine petitioner via telephone.
Petitioner testified that his vision problem came on suddenly. He said: "I'm not sure when it happened, but all of a sudden I thought my glasses needed to be changed and it was several months before I went to the doctor and, to my surprise, I found out I lost my visibility." On December 13, 2001, the doctor determined that he had lost visibility in his eye. A month later, he had unsuccessful laser surgery performed in an attempt to correct his vision.
Against these proofs, the court made the following findings:
The permanent disability arises from two issues, . . . one is [petitioner's] knees. . . . Whatever residuals he had before, it only affected one leg and now it's both legs. His eyes were in trouble. His right eye was in trouble before his left eye and it started showing up by the time this accident happened. I may have made some comments earlier. Now, I'm going to rely strictly on the proofs in case as they come out today. I'll assume for purposes of this decision, that his right eye is functional and capable of working or giving him useable vision. His vision is 20/200 and a loss of some peripheral vision in that, that's one eye. Maybe this eye is worse than it was when he was working, but it increased, whether coincidental with his termination of employment or afterwards, or just before is irrelevant. It was not totally disabling. The impairment was there. The disease was there. It got worse, okay. I'll agree with that for academic purposes here, that doesn't mean he's frozen out of the Second Injury Fund. If the legislature intended to exclude people with any type of disease or condition, which can progress after a last compensable injury, they would have said so. They did not say that they were talking about conditions which are progressive and go onto total disability in and of itself. . . . . . . [W]hen his employment ended and after the treatment for his left knee ended, he was permanently partially disabled in that left leg. He had some visual disability when all that manifested and that condition was there before. . . . He can't go into any job driving, which is what he did for most of his working life because of his visual problem, which pre-existed the last accident, and the full manifestation of the last disability, and he cannot go into more sedentary employment . . . He just can not do that with those knees. He can not sit for any period of time. Consequently, he is totally disabled from all conditions disabled, partially from his eyes and part from his accident. . . . The disability is 50/50, 50% from the knee injuries, 50% for the loss of vision or vision in the right eye. There are other medical conditions, but I am not considering them in this case because I do not believe there is adequate proof.
The standard of review on decisions by the Division of Workers' Compensation is "whether the findings made could reasonably have been reached on sufficient credible evidence present in the record, considering the proofs as a whole, with due regard to the opportunity of the one who heard the witnesses to judge of their credibility." Peterson v. Hermann Forwarding Co., 267 N.J. Super. 493, 503 (App. Div. 1993) (citation omitted), certif. denied, 135 N.J. 304 (1994). Applying this standard, we conclude that the evidence does not support the court's conclusion that the Fund is liable.
The Fund is established by statute, N.J.S.A. 34:15-95, which provides, in part, that compensation payments in accordance with the provisions of paragraph (b) of R.S. 34:15-12 shall be made to persons totally disabled, as a result of experiencing a subsequent permanent injury under conditions entitling such persons to compensation therefor, when such persons had previously been permanently and partially disabled from some other cause; provided, . . . further, however, that no person shall be eligible to receive payments from the Second Injury Fund:
(a) If the disability resulting from the injury caused by the person's last compensable accident in itself and irrespective of any previous condition or disability constitutes total and permanent disability within the meaning of this Title.
(b) (Deleted by amendment.)
(c) If the disease or condition existing prior to the last compensable accident is progressive and by reason of such progression subsequent to the last compensable accident renders the person totally disabled within the meaning of this Title.
(d) If a person who is rendered permanently partially disabled by the last compensable injury subsequently becomes permanently totally disabled by reason of progressive physical deterioration or pre-existing condition or disease.
Nothing in the provisions of said paragraphs (a), (c) and (d), however, shall be construed to deny the benefits provided by this section to any person who has been previously disabled by reason of total loss of, or total and permanent loss of use of, a hand or arm or foot or leg or eye, when the total disability is due to the total loss of, or total and permanent loss of use of, two or more of said major members of the body, or to any person who in successive accidents . . . .
The Fund was enacted to protect employers who hire partially disabled workers from an unfair burden and to protect employees from being denied employment because of a pre-existing condition. Lewicki v. N.J. Art Foundry, 88 N.J. 75, 83 (1981).
[T]he Fund is liable when a partially permanently disabled worker becomes totally and permanently disabled as a result of a work-connected accident . . . that, in combination with the pre-existing physical impairment, results in permanent total disability. The worker receives compensation for the full measure of his disability and the employer is relieved of that portion of the burden unrelated to the employment. . . .
The intent of the Fund is to encourage the hiring by industry of people handicapped by pre-existing disabilities [by assuming] liability for the portion of the disability attributable to the pre-existing impairment. [Id. at 83-84 (citation omitted).]
Liability will only be attributed to the Fund "when the statutory requirements have been fully met." Id. at 84. The burden of proving Fund liability rests on the party seeking to impose it. Ibid.
The Fund initially asserts that the court made a finding of Fund liability in the first half of the bifurcated trial, before the Fund was even a party. Next, it asserts that the judge erred by not permitting the Fund to cross-examine Dr. Klein on the question of whether petitioner's right eye disorder pre-existed his October 2000 compensable injury. Finally, the Fund submits that even with those procedural errors, the court's decision must be reversed as the proofs at trial failed to establish that petitioner's eye disorder pre-existed the October 2000 compensable injury. We agree with each of the Fund's arguments.
We begin with the court's apparent finding that the Fund was liable at the conclusion of the first half of the bifurcated trial, even though the Fund had not participated in that trial. N.J.A.C. 12:235-5.1 provides for the general procedures to be followed by judges of compensation in cases alleging Fund liability, including the following:
(a)2. If a settlement cannot be effectuated . . . the matter may be bifurcated and listed for trial on a day when the probable responsible respondent is regularly scheduled to appear.
(e) If the Judge of Compensation finds that the petitioner is totally and permanently disabled and the total and permanent disability may be the result of the last compensable accident together with pre-existing conditions, the Judge of Compensation shall schedule a hearing upon the application for Fund benefits on a day when the Deputy Attorney General representing the Fund regularly appears.
1. The hearing to determine whether the petitioner is entitled to Fund benefits shall be upon the transcript of the hearing for benefits previously heard, supplemented by oral and documentary evidence as may be required in the discretion of the Judge of Compensation for a full and true disclosure of the facts as to Fund responsibility and where applicable, as to an apportionment of the responsibility of the Fund.
In other words, if in the initial trial the court finds that the petitioner is totally disabled, the court shall then schedule a hearing to determine if the petitioner is entitled to Fund benefits. The court here did not follow this procedure. Instead, it essentially found that the Fund was liable before the Fund had an opportunity to participate in the trial. At the November 17, 2006 proceeding, the court, although not making an apportionment of disability between the Fund and petitioner's employer, did find that the Fund was liable. The judge scheduled a hearing, not to determine if the Fund was liable, but to determine the extent of the Fund's liability. These findings were error in that the Fund had not had an opportunity to contest petitioner's claim for Fund benefits.
The court also erred by failing to permit counsel for the fund to cross examine Dr. Klein. As we expressed in Paco v. Am. Leather Mfg. Co., 213 N.J. Super. 90, 93 (App. Div. 1986), although workers' compensation regulations give the workers' compensation court the ability to relax the rules of evidence, the regulations may not be "construed to infringe upon the substantive rights of either party. . . . [A] party's fundamental right to due process which includes the right to present and cross examine a witness, must be respected."
The procedure followed by the compensation court deprived the Fund of its due process rights. Not only did the court make a determination that the Fund was liable before the Fund had an opportunity to participate, but when the Fund was made a party to the case, it was deprived of its right to cross-examine Dr. Klein, petitioner's medical witness. Id. at 96 ("It is firmly established in our jurisprudence that parties must be afforded the right to cross-examine witnesses and to produce evidence to address the relevant issues in a contested proceeding."); see also Katz v. Twp. of Howell, 68 N.J. 125, 129 (1975) ("remand contemplated further proofs in the normal manner, i.e., by in-court testimony subject to cross-examination"). The judge effectively precluded the Fund from litigating whether the petitioner had a pre-existing eye disability prior to his compensable injury. And it was that eye disability, in conjunction with petitioner's knee disorders, upon which the judge relied to hold the Fund liable.
That said, despite those due process violations, neither the petitioner nor his employer proved, by competent evidence, that petitioner had a measurable functional eye disability that pre-existed his compensable injury. See Lewicki, supra, 88 N.J. at 84 (burden of proving eligibility lies on party seeking to impose fund liability). Thus, Fund liability has not been established.
N.J.S.A. 34:15-95 provides, in part, that payments shall be made to persons totally disabled, as a result of experiencing a subsequent permanent injury under conditions entitling such persons to compensation therefor, when such persons had previously been permanently and partially disabled from some other cause . . . .
The party seeking to impose liability on the Fund must "establish by competent evidence that there is a previous measurable functional disability. . . . [Only then does t]he legislative scheme require that responsibility for such prior disability fall on the Fund." Gulick v. H.M. Enoch, Inc., 280 N.J. Super. 96, 115 (App. Div. 1995). N.J.S.A. 34:15-36 defines a "disability permanent in quality and partial in character" as: permanent impairment caused by a compensable accident or compensable occupational disease, based upon demonstrable objective medical evidence, which restricts the function of the body or of its members or organs . . . .
Here, the judge based his decision to impose fifty percent Fund liability on petitioner's vision loss. The judge found that "the impairment was there. The disease was there. . . .
[Petitioner] had some visual disability when all that manifested and that condition was there before. . . . his visual problem, which pre-existed the last accident." Medical evidence to support that finding, however, is absent from the record. Petitioner presented no "demonstrable objective medical evidence" that he had a "previous measurable functional [eye] disability" prior to his compensable injury in October 2000.
Petitioner testified that he began having "problems" with his right eye in 1999 or 2000. But it was not until 2001 that "all of a sudden" he needed to change his glasses and "to [his] surprise, [he] found out that [he] lost visibility." Dr. Klein testified that petitioner had had some visual complaints in his eyes dating back to 1997, but this vein occlusion is a result of hypertension. I have retinopathy that occurs spontaneously.
I mean, basically he didn't have a retinal branch vein occlusion that was decompensating his vision in 1997. Basically the symptomology started before.
All we know is that in the 12-1-01, that was when the doctor noted a chronic branch occlusion of the right eye. I don't know exactly when it started.
Thus, the evidence does not show when petitioner first experienced symptoms of the retinal vein occlusion. Petitioner did not suffer complete loss of vision in his right eye until December 2001. Dr. Klein admitted that he did not know when the retinal vein occlusion occurred. All he could say was that the disorder did not manifest itself until December 2001. He did not testify that the "problems" petitioner had experienced in his right eye prior to the date of his compensable accident, October 2000, were in any way related to the retinal vein occlusion that was first diagnosed in December 2001. Even petitioner's own testimony indicated that he was not aware when his vision problem began. Said another way, there was no competent evidence that petitioner's loss of vision in his right eye, which was the disorder that combined with his compensable injury to render him totally disabled, began before his October 2000 accident.
We are mindful that not every pre-existing "disability which contributes to an employee's total and permanent disability" must meet a "'rigorous literal formula' of 'fixed, measurable and arrested.'" Walsh v. RCA/Gen. Elec. Corp., 334 N.J. Super. 1, 9 (App. Div. 2000) (quoting Lewicki, supra, 88 N.J. at 86). Nevertheless, the Fund is only liable for the portion of the total disability attributable to "a previous permanent partial disability from some other cause" that combines with the compensable accident to render the employee totally and permanently disabled. Lewicki, supra, 88 N.J. at 79, 84. The medical proofs here simply do not establish that petitioner's right eye disorder, which combined with his compensable injury to render him totally disabled, pre-existed the date of the compensable accident.
Accordingly, we reverse the decision of the workers' compensation court holding the Fund liable.
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