The Legal Buzz – Lee & Brown Newsletter and Case Law Update July 2019
Congratulations are in Order!
L&B welcomes M. Frances McCracken to the Firm as Partner. Ms. McCracken has been with L&B for 4 years after the dissolution of her previous Firm. Her 30 years of experience in insurance defense is a great asset to our Firm, as is her commitment to her profession and her clients. Ms. McCracken’s practice over the years has involved all aspects of the litigation process, including success in trials and appeals, arbitration, mediation and case settlement. She has defended cases in the Colorado State District Courts, Court of Appeals, the Supreme Court, as well as U.S. District Court. Her expertise as a legal writer and litigator raises the bar for not only our Firm, but in the insurance defense and legal community as a whole. Please join us in congratulations to Fran, for a well-deserved lifetime achievement.
L&B announces the promotion of Associate Jessica Melson to Of Counsel. Ms. Melson joined L&B in February 2012 with previous insurance defense experience. Since that time, she has grown tremendously as an attorney in her dedication and her commitment to provide the best legal defense for her clients while developing into a strong example as a professional to the Firm’s Jr. Associates and in the legal community. Ms. Melson regularly shares her knowledge of insurance defense by providing educational counseling to clients. She has volunteered pro bono legal services for the Colorado Lawyers Committee and Metro Volunteer Lawyers. The Firm congratulates you, Jessica, on your achievements thus far in the legal profession.
L&B promotes Associate Angela M. Lavery to Of Counsel. Ms. Lavery came to L&B in 2011 as a Paralegal. It soon became apparent that Ms. Lavery, who earned her law degree from the University of Denver Sturm College of Law in 1995, was capable of much more. Since receiving her license from the State of Colorado in 2012, Ms. Lavery has been diligently working to provide excellent legal defense to her clients, to whom she also regularly counsels on the ever-changing and evolving analysis of legal issues and the law. Ms. Lavery has blossomed into a patient and knowledgeable mentor for the Jr. Associates and Law Clerks in the Firm, as well as in the legal community. Outside of the Firm, she still makes time to contribute pro bono as a Court-Appointed Special Advocate for Children with Denver CASA. Congratulations, Angela, on a job well done. The Firm is proud to have you join us as Of Counsel.
You have all made L&B a better place by your contributions and your dedication and we look forward to sharing in your future accomplishments.
In Tremain v. Caterpillar, Inc. and Liberty Mutual Insurance, W.C. No. 5-092-748, Of Counsel Sheila Toborg and Of Counsel William Sterck successfully defended against Claimant’s claim of compensability for an injury he believed to be in the course and scope of his employment. Claimant argued that he sustained a compensable injury and that he was entitled to medical care and disability benefits. During hearing, Ms. Toborg argued that, per Respondents’ expert report, Claimant’s exhibited symptoms were chronic and not work-related. Mr. Sterck argued in the Respondents’ Position Statement that Claimant had no claim in fact, or in law, for the relief he was seeking. Because of the combined efforts of Ms. Toborg and Mr. Sterck, the ALJ found that Claimant failed to prove by a preponderance of the evidence that he had a compensable claim. The claim was dismissed.
In Thompson v. The Home Depot and Liberty Mutual Insurance, W.C. No. 4-886-616, Of Counsel Sheila Toborg and Associate Jessie M. Tasselmyer successfully defended against Claimant’s attempt to overcome the Division Independent Medical Examination for injuries sustained as a result of a May 2012 admitted work injury. ICAO affirmed the ALJ’s ruling and found that they had no basis to overturn the prior ruling. The ALJ appropriately credited the opinion of Respondents’ expert and that there was no perceivable error of law.
You Get a Fine, I Get a Fine, Everybody Gets a Fine: In Colorado Department of Labor and Employment v. Dami Hospitality, 2019CO47M (June 3, 2019)(awaiting publication), the DOWC fined Dami $841,200 for failure to carry workers’ compensation insurance for 1,698 days. Dami appealed. ICAO affirmed; however, the Supreme Court reversed the decision deciding the fine violated the Excessive Fines Clause of the 8th Amendment because the DOWC failed to consider Dami’s ability to pay the fine. The Colorado Supreme Court found the Court of Appeals applied the incorrect test to determine whether the fine was excessive. It held that the correct test to determine whether a fine is excessive is whether the amount of the fine is grossly disproportional to the gravity of the offense. The Court ruled, “The court of appeals’ ruling is thus reversed and the case is remanded to that court for return to the Division of Workers’ Compensation to determine whether the per diem fines at issue are proportional to the harm or risk of harm caused by each day of the employer’s failure to comply with the statutory requirement to carry workers’ compensation insurance.”
Moral of the Story: It is imperative to have workers’ compensation insurance coverage. Failure to do so can result in substantial fines.
Is it a Cure? In Rajabi v. ICAO; Arvada Fire Protection District…, 2018CA1599 (May 16, 2019)(unpublished), Claimant sustained an admitted injury to the right hand in April 2017 and was diagnosed with complex regional pain syndrome. Claimant requested help with housekeeping and yard work. The ATP recommended in-home housekeeping and yard services. Nonetheless, the ATP did not assign Claimant restrictions pertaining to the right hand.
The Colorado Court of Appeals affirmed ICAO’s Order finding that Claimant’s request for in-home housekeeping and yard services was not reasonable, necessary, and related to the claim. Specifically, the request for in-home housekeeping and yard services was not “medical in nature or incidental to obtaining such medical or nursing treatment.” The Court opined that Claimant’s request for in-home housekeeping and yard work did not relieve and or cure Claimant’s condition. As such, the request was not medically reasonable or necessary. The Colorado Court of Appeals affirmed the credibility determinations and legal standards utilized by the ALJ.
Moral of the Story: Treatment recommended by an ATP must cure and/or relieve a claimant of his/her symptoms resulting from a work-related injury.
Make it Count. In Humphrey v. FedEx Freight Inc., W.C. No. 4-911-782, the Claimant sought review of an Order denying his Motion to Strike the Respondents’ Final Admission of Liability (FAL). Respondents allegedly failed to attach the proper MMI medical report when filing the FAL. As such, the claim was never administratively closed and the Claimant was not required to pursue a reopening of his claim. ICAO set aside the ALJ’s Order and remanded the case to the ALJ for further findings. ICAO ruled that FALs are a jurisdictional requirement “and their inadequacy may be raised at any time…” The ALJ was instructed to address his findings of fact and conclusions of law as to why Claimant’s Motion was denied.
Moral of the Story: A FAL must be filed with the proper medical report to administratively close the claim.
Better to Be Assertive: In the Matter of the Claim of Quincy Bryant v. Transit Mix Concrete and Traveler’s Indemnity Company, W.C. no. 5-058-044-001 (ICAO June 5, 2019), ICAO affirmed in part, and remanded in part, an ALJ’s Order that Respondents overcame the DIME. First, the Panel held that the ALJ erred in reversing the DIME physician with respect to the Table 53 diagnosis. The ALJ incorrectly held that the law requires objective rigidity in order to assign a Table 53 diagnosis when rating the cervical spine. The law has no such requirement: the requisite rigidity may arise from the Claimant’s subjective complaints or objective evidence. Secondly, the Panel held that the ALJ properly found that Respondents did not waive their ability to assert a safety violation. Although Respondents did not assert a safety rule violation in the FAL, they did timely assert it in their Application for Hearing challenging the findings of the DIME. Ultimately, the Panel reversed the ALJ’s findings with respect to the Table 53 diagnosis and remanded for further findings on whether there was evidence, subjective or objective, of rigidity. The Panel affirmed the ALJ’s finding that Respondents did not waive the ability to assert a safety rule violation.
Moral of the Story: A Table 53 diagnosis requires objective evidence with respect to pathology, but not with respect to rigidity. Respondents must make sure to assert all implicated affirmative defenses on their pleadings in order to prevent waiver.
Smacking Some Sense into Loofbourrow: In this next case, Respondents filed a medical-only FAL. Seventy five days later, Claimant objected to the FAL and filed a Notice and Proposal to Select a DIME. Respondents moved to strike Claimant’s request for a DIME as untimely because it was filed outside of the 30-day time requirement. The ALJ agreed and struck Claimant’s request for DIME. Claimant appealed and argued, according to Loofbourrow, 320 P.3d 327 (Colo. 2014), a medical-only FAL does not close a claim, has no statutory significance, and does not trigger the statutory time requirements to request a DIME. The Panel disagreed. It distinguished Loofbourrow because it involved a claim where no FAL was filed. The Panel affirmed the ALJ and held that a medical-only FAL has the same legal effectiveness as any other FAL. Martinez v. Energy Savings Crew, LLC, W.C. No. 5-055-251 (May 31, 2019).
Moral of the Story: Filing a FAL triggers the statutory time requirements to request a DIME. Without a FAL, a claim may remain open indefinitely.
No Alter Ego Here: In McRobbie v. Estate of Mary E. Wales, W.C. No. 5-052-934 (May 24, 2019), Claimant worked as a caregiver to Mary Wales. She was seating Ms. Wales on a shower bench when she felt shooting pain going through her left arm into her fingers. Claimant was later diagnosed with a cervical disc herniation. Ms. Wales subsequently passed away. The ALJ found that Mary Wales and Carolyn Cargile (Mrs. Wale’s daughter who held Power of Attorney) were joint employers and that each were personally liable for Claimant’s injury. The ALJ found that Ms. Cargile was personally liable as Claimant’s employer based on the theory of an alter ego. The ICAO reversed, finding that when an individual is acting through a power of attorney as an agent and identifies as such, she cannot be named as an employer for a contract of employment or be personally liable. The ICAO further explained that the theory of an alter ego does not apply when an agent discloses that she is acting on behalf of an employer through a power of attorney. The ALJ’s Order was corrected to designate the sole employer to be the Mary E. Wales Revocable Trust.
Moral of the story: An individual acting as an agent to an identified principal cannot be held personally liable for a workers’ compensation claim.
Explanation is Key: In Gil De Prieto v. Spirit Hospitality II LLC, W.C. No. 5-019-619 (May 24, 2019), Claimant sustained a left shoulder injury while working as a housekeeper. As a procedural matter, Respondents were permitted to take a post-hearing deposition of a physician. Claimant then filed an Opposed Motion to Submit Rebuttal Evidence via a Deposition of another physician in order to rebut Respondents’ post-hearing deposition. The ALJ summarily denied Claimant’s Motion. The ICAO found that the denial of Claimant’s Motion was an abuse of discretion because the ALJ did not provide any basis or reasoning behind his Order. The ALJ’s Order was set aside and remanded for further findings.
Moral of the story: An ALJ’s findings of fact and conclusions of law are an abuse of discretion if they are not supported by the evidence or fail to provide an explanation behind the order.
Read Between the Lines: In Lopez v. Holsinger Drywall Inc., W.C. No. 5-066-416 (May 16, 2019), Claimant sustained several injuries, including fractures of his pelvis and vertebrae in his back, after falling 12 feet to the ground while working on an apartment construction project. Claimant’s claim for compensation was denied by Respondents on the basis that he was an independent contractor as defined by C.R.S. § 8-40-202(2)(b). At hearing, the ALJ found that Claimant was an independent contractor, not Respondents’ employee. ICAO reversed the ALJ’s Order, finding that the ALJ misapplied the legal standard when he placed undue reliance on two documents signed by Claimant wherein he declared himself an independent contractor. The Panel explained that “the nature of the working relationship” must be examined as a whole rather than relying exclusively on the requirements of the controlling statute. The Panel analyzed Claimant’s actual working relationship with the parties and found that the undisputed record showed that he was not engaged in operating an independent business and, therefore, was not an independent contractor. The ALJ’s Order was reversed and the claim was ordered to be compensable.
Moral of the story: Simply meeting the statutory requirements to establish an independent contractor status does not necessarily mean an individual is an independent contractor. Other circumstances surrounding a claimant’s employment relationship should also be considered when determining his/her employment status.