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Workers' Compensation

California: Say It’s Not True! Apportionment and the Conclusive Presumption of Permanent Total Disability

In a split panel decision issued on March 5, 2020, the WCAB in Fraire v. California Department of Corrections and Rehabilitation/SCIF 2020 Cal.Wrk.Comp. P.D. LEXIS ___ rescinded the WCJ’s three decisions including two separate awards of 100% permanent total disability without apportionment. The WCJ based the two separate awards of PTD on Labor Code section 4662(a)(1), “Loss of both eyes or the sight thereof.” The WCJ also failed to apportion any of the applicant’s disability under Benson to any of the three separate consolidated specific injuries.

In rescinding all three decisions, including the WCJ’s two total permanent disability awards, the WCAB held that the Labor Code Section 4662(a) conclusive presumption of permanent total disability does not preclude apportionment based on Labor Code section 4663 and under Benson. At the heart of the WCAB’s decision is the “....clear and unambiguous language of section 4662(a) established that the disability in question-loss of sight in both eyes in this case-must be conclusively presumed to be “total in character” (emphasis added). That is, the “character of the overall permanent disability must be conclusively deemed to be “total,” i.e., 100%.”

The WCAB also stated that “....section 4662(a)’s conclusive presumption that certain specified disabilities are “total in character” does not establish that such conclusively presumed 100% permanent disabilities entirely resulted from industrial causation.”

In remanding the case back to the trial level, the WCAB indicated that with respect to applicant’s loss of sight in both eyes rendering her legally blind was apportionable based on 60% industrial (aggravation of her underlying diabetes) and 40% nonindustrial related entirely to her pre-existing diabetes. The WCAB in returning the matter back to the WCJ indicated the need for new decisions applying “apportionment to causation principles under sections 4663 and 4664(a).”

Addressing Benson apportionment, the WCAB indicated that with respect to the 60% industrial causation of applicant’s disability, 30% should be apportioned to the specific injury of September 11, 2006 and 30% to the specific injury of June 28, 2012.

Factual & Medical Overview: The facts were essentially undisputed. Applicant suffered three specific injuries on May 23, 2005, September 11, 2006 and June 28, 2012. The WCJ awarded two separate permanent total disability awards related to the specific injuries of September 11, 2006, and June 28, 2012. Moreover “...the WCJ found that although the medical evidence established that only half of applicant’s permanent disability was caused by her June 28, 2012 industrial injury, the conclusive presumption of section of section 4662(a)(1) precludes the apportionment of applicant’s total disability.”

The Medical Evidence: There were four Agreed Medical Examiners in internal medicine, ophthalmology, psychiatry, and neurology. There was also a QME in orthopedics. Regarding apportionment, the AME in ophthalmology opined that the applicant was “legally blind.” He also indicated applicant’s visual/ophthalmic disability was “proportional to the industrial causation of the underlying diabetes and/or hypertension, if present.” In doing so he deferred to the AME in internal medicine. In response the AME in internal medicine reiterated his prior opinion on apportionment that 60% of the applicant’s visual disability was industrial and 40% nonindustrial. With respect to the 60% industrial causation, 30% was attributable to the specific injury of September 11, 2006 and 30% to the specific injury of June 28, 2012.

Analysis: The Board majority began their analysis with the basic legal principles related to statutory construction. There is an initial acknowledgement that the clear and unambiguous language of 4662(a) that loss of sight in both eyes “...must be conclusively presumed to be “total in character” (original emphasis). That is, the “character” of the overall permanent disability must be conclusively deemed to be “total,” i.e., 100%.”The Board then qualified that statement by stating:

Nevertheless, section 4662(a)’s conclusive presumption that certain specified disabilities are “total in character” does not establish that such conclusively presumed 100% permanent disabilities entirely resulted from industrial causation.”

Significantly, the language of section 4662(a) is silent on the question of whether an industrially injured employee’s conclusively presumed 100% overall permanent disability is subject to apportionment. When a statute is completely silent on a point, the Appeals Board must construe it in the context of the entire statutory scheme, with the goal of harmonizing it with related sections and promoting the legislative objective (citations omitted).

The WCAB referenced sections 4663 (a) and (b), as well as 4664(a). The Board also summarized several key apportionment cases related to the legal principles governing apportionment of permanent disability based on causation, specifically the California Supreme Court’s decision in Brodie v. Workers’ Comp. Appeals Bd. (2007) 40 Cal.4th 1313 (72 Cal.Comp.Cases 565); as well as Benson v. Workers’ Comp. Appeals Bd. (2009) 170 Cal.App.4th 1535, 1556 (74 Cal.Comp.Cases 113); and Escobedo v. Marshalls (2005) 70 Cal.Comp.Cases 604, 616 (Appeals Board en banc). Based on what the WCAB characterized as the clear and unambiguous language of sections 4663 and 4664(a) and interpretive case law the Board stated:

Therefore, the clear and unambiguous language of section 4663 and 4664(a) requires that the apportionment of permanent disability-be it permanent total disability or permanent partial disability-“shall” be based on causation. (See Acme Steel v. Workers’ Comp. Appeals Bd. (Borman) (2013) 218 Cal.App.4th 1137 [78 Cal.Comp.Cases 751] [apportionment to non-industrial causation applies even when effects of injury result in total loss of earning capacity and 100% permanent disability].) This plain language does not exempt permanent disability that is conclusively presumed to be total pursuant to section 4662(a).

The Significance of section 4664: The Board noted that when the Legislature enacted section 4664 in 2004, there was an express reference to disabilities that are conclusively presumed to be total in nature pursuant to 4662(a). Specifically, the reference in 4664 to section 4662 was included only in section 4664(c)(1) which relates to “...the accumulation of all permanent disability awards issued with respect to one region of the body.” This was significant to the WCAB’s analysis since:

“...[t]he fact that the Legislature did not concurrently exclude conclusively presumed disabilities under section 4662(a) from the apportionment to causation provision of section of section 4664(b) (original emphasis)-or from the apportionment to causation provision of section 4664(a) that was enacted by the same bill at the same time (citation omitted)-strongly suggests that the Legislature did not intend to exclude conclusively presumed total disabilities under section 4662(a) from those apportionment to causation provisions. (Cf. Pasquotto v. Hayward Lumber (2006) 71 Cal.Comp.Cases 223, 236-237 (Appeals Board en banc) (the principle that statutes relating to the same subject matter must be harmonized to the extent possible “applies with particular force when the two statutes relating to the same subject matter were enacted by the same bill and chaptered at the same time”) (citations omitted).

Avoiding Absurd Results and Promoting Employers to Hire Disabled Workers: With respect to apportionment of permanent disability based on causation, he Board could not find a reasonable rationale or logical basis “...for distinguishing between permanent disabilities that are conclusively presumed to be total in character pursuant to section 4662(a) and 4660.”

In responding to an argument in the concurring and dissenting opinion of Chairwoman Zalewski, the Board noted that with respect to the Legislative intent in enacting SB 899 and sections 4663 and 4664 there was intent to encourage employers to hire disabled workers. (citations omitted). “Yet under the dissent’s interpretation of section 4662(a), an employer who hired an employee with a pre-existing loss of the use of one arm or one eye would be liable for the employee’s entire 100% permanent disability if a workplace injury caused the loss of the use of the other arm or other eye.

Labor Code Section 4662(a) and the Phrase “total in character”: The WCAB discussed the fact that the Legislature must have “...had some purpose in mind when it used the phrase “total in character” in section 4662(a) (original emphasis.) (citations omitted).

The WCAB’s Conclusion and Holding: The Board concluded as follows:

We conclude that section 4662(a)’s language that certain specified permanent disabilities “shall be conclusively presumed to be total in character (original emphasis) simply signifies that the “one of the attributes,” but not the sole attribute, of permanent disabilities under section 4662(a) are that they are presumed to be total “in character” (original emphasis) does not mean that these disabilities cannot also have other characteristics such as being caused by non-industrial factors.”

Discussion and Related Cases: Given what is at stake in this case for the applicant, i.e., two separate 100% PTD awards, it is almost a certainty the case will end up at the Court of Appeal even after the WCJ issues a second decision following remand. If it does end up at the Court of Appeal, it is safe to assume the case will attract a host of amicus petitions from CAAA, the CWCI and many others. Applicant’s counsel on appeal will no doubt expand upon the arguments and analysis in the concurring and dissenting opinion of Chairwoman Zalewski.

Another Suggested Analytical Perspective: There appears to be a very significant threshold issue in this case that was not fully developed by the Board. Is the applicant’s disability described by the AME in ophthalmology as “legally blind” as opposed to being “totally blind” medically and factually sufficient to trigger or establish the 4662(a)(1) required definitional criteria for the conclusive presumption of 100% permanent disability “total in character” that requires “....[l]oss of both eyes or the sight thereof.”

Is being diagnosed as “legally blind” the “total in character” equivalent to, or synonymous with, the loss of both eyes which clearly equates to total blindness or the total loss of sight? It can be argued that the plain meaning of the statute and the underlying Legislative intent requires total blindness as opposed to being “legally blind.” There is an argument that being legally blind as opposed to being totally blind is insufficient both medically and factually to establish the definitional criteria required to or trigger the 4662(a)(1) conclusive presumption. Chapter 12.2b, page 281 of the AMA Guides 5th Edition, indicates that the term “legal blindness” is patently ambiguous in noting “.....that the term legal blindness is a misnomer because 90% of individuals who have 20/200 or less visual acuity are not blind. The term severe vision loss as used in ICD-9-CM should replace the term legal blindness.”  

Total Blindness Compared to Legally Blind: Being legally blind generally refers to people that have less than 20/200 vision in the better eye or a limited field of vision that is 20 degrees or less at its widest point. People who are legally blind may in many circumstances have some useful vision. In some situations corrective eyewear or contacts can provide legally blind individuals with some degree of visual acuity. Individuals who are legally blind may qualify for disability benefits under Social Security even though they are only partially blind. Total blindness i.e., the absence of both eyes is an automatic qualification for Social Security disability benefits. However, in the California Workers’ Compensation system, qualifying for federal Social Security benefits is not a basis factually or legally to automatically establish an applicant is 100% permanently totally disabled let alone entitled to invoke the conclusive presumption of 100% permanent total disability based on any of the permanent disabilities set forth in section 4662(a),(1)-(4)

In comparison to legally blind individuals, totally blind or clinically blind individuals have a complete loss of vision and corrective eyewear such as eyeglasses or contact lenses cannot reverse or ameliorate the effects of complete vision loss. Totally blind and clinically blind individuals need Braille, audio recordings, raised line drawings, and other non-visual media as accommodation for accessing the content of visually presented materials.

Cases Related to the “Total in Character” Threshold Requirements Necessary to Establish or Trigger any of the Conclusive Presumptions of 100% PTD under 4662(a) (1)-(4): With respect to the issue of the Labor Code §4662(a) conclusive presumption of total disability foreclosing apportionment, much of the litigation focuses on whether the injured worker meets the definitional criteria or conditions for injuries resulting in “loss of both hands or the use thereof” (Labor Code §4662(a)(2)), or “an injury to the brain resulting in permanent mental incapacity. (Labor Code §4662(a)(4)) and “an injury resulting in a practically total paralysis.” (Labor Code §4662(a)(3)).

In Farren v. State of California, Dept. of General Services 2015 Cal.Wrk.Comp. P.D. LEXIS 589 (WCAB Panel Decision). The WCAB reversed a WCJ’s award of 100% permanent disability under the Labor Code §4662(a)(3) conclusive presumption based on “an injury resulting in practically total paralysis without apportionment on the basis that applicant was dependent upon the use of a wheelchair when she leaves her home, but used a walker in her home. The WCAB found that applicant’s condition as a whole did not equate to “practically total paralysis. As a consequence the WCAB found valid non-industrial apportionment related to applicant’s low back disability to a pre-existing condition found by the AME.

Instead of a 100% permanent disability award, in Farren, applicant received three awards of 80.75%, 7%, and 9.75%. (see also, Alvarez v. American International Group 2017 Cal.Wrk.Comp. P.D. LEXIS 209 (WCAB panel decision) where the WCAB affirmed a WCJ’s award of 62% PD, after apportionment and that applicant was not “practically totally paralyzed” for purposes of the conclusive presumption of permanent total disability, without apportionment under Labor Code §4662(a)(3). The medical evidence did not reflect that applicant was diagnosed with paralysis. She was able to stand independently and to transfer independently from her wheelchair to her bed. Applicant was also able to stand a short time and walk two or three steps. She also did not lose her ability to feel her legs and retained the ability to move her lower extremities.

In Winnigham v. State of California Department of Corrections 2016 Cal.Wrk.Comp. P.D. LEXIS 251, the WCAB affirmed a WCJ’s award of 84% PD after apportionment. The WCAB also rejected applicant’s contention he was entitled to the conclusive presumption of permanent disability based on “an injury to the brain resulting in permanent mental incapacity” for purposes of Labor Code §4662(a)(4). Applicant had significant cognitive residuals including a GAF of 45 and other serious psychological symptoms and impairments as a result of an injury to his brain and other systems and conditions. The Board stated “[h]owever, given the legislative history of Labor Code §4662(a)(4), when viewed the partial cognitive impairments sustained as a result of the injury were not enough to raise the Labor Code §4662(a)(4) presumption.” The WCAB cited Schroeder v. WCAB 78 Cal.Comp.Cases 506 in support of its decision.

In a writ denied case, Kloeckner USA Holdings v WCAB (De La Rosa) (2019) 84 Cal.Comp. Cases 1020, 2019 Cal.Wrk. Comp. LEXIS 99 affirmed the WCAB’s award of 100% PTD without apportionment based on the conclusive presumption in 4662 (a)(4) an injury to the brain resulting in permanent mental incapacity. In De La Rosa, applicant’s industrial head injury aggravated or lit up applicant’s pre-existing neurodegenerative disorder which resulted in applicant suffering profound cognitive dysfunction. In addition, the Court of Appeal remanded the case to the WCAB for the purpose of making a supplemental award of attorney’s fees to applicant since the Court of Appeal determined there was no reasonable basis for defendant’s petition for Writ of Review.

In Kloecker, in contrast to the cases cited hereinabove, there was substantial medical evidence that applicant met or satisfied the threshold definitional criteria necessary to establish an injury to the brain resulting in permanent mental incapacity warranting application of the 4662(a)(4) conclusive presumption of 100% PTD.

In Hirschberger v. Stockwell, Harris, Wolverton, and Muehl/SCIF 2018 Cal.Wrk.Comp. P.D. LEXIS 482 (WCAB panel decision), a case cited in the concurring and dissenting opinion of Chairwoman Zalewski in Fraire, applicant was awarded 100% PTD on the basis of the conclusive presumption set forth in 4662(a)(4) “an injury to the brain resulting in permanent mental incapacity.” In Hirschberger there was evidence that applicant’s brain was already damaged as a result of the progressive nature of his Parkinson’s disease that existed prior to the industrial injury.

One of the key aspects of the case was the fact that the parties stipulated to applicant’s underlying pre-existing Parkinson’s disease was industrial and also that his “Parkinson’s disease involved “sequelae” of high blood pressure, lung injury, sleep disturbance, and psyche, brain and back problems.”

Without the critical early stipulation that applicant’s Parkinson’s disease was industrial and was by its very nature an insidious progressive disease directly effecting the brain, it is questionable whether there would have been substantial medical evidence to support that applicant’s brain injury resulted in permanent mental incapacity to the degree and severity necessary to invoke or trigger the 4662(a)(4) conclusive presumption of 100% PTD.

© Copyright 2020 Raymond F. Correio. All rights reserved. Reprinted with permission.

MARIE FRAIRE 4662a APPORTIONMENT DOES APPLY CASE.pdf