B&B attorneys have been arguing over these many months that the WCAB commissioners had it wrong in Torres (a panel decision) as well as Pendergrass and Baglione (two 1/24/07 en banc decisions).
It turns out that B&B was right! The panel in Torres v. SDM Precision Products (which included Commissioners Rabine, Brass, and Caplane) interpreted Labor Code §4660(d). The issue before the WCAB was whether a comprehensive medical/legal report that issued prior to 1/1/05, had to indicate evidence of the existence of permanent disability in order for the old Permanent Disability Rating Schedule (1997 PDRS) to apply. In Torres, an AOE/COE report was obtained on 3/18/04. It did not find permanent disability. The Panel held that in order for the 1997 PDRS to apply to a pre-1/1/05 injury, it is sufficient that any comprehensive medical-legal report issue prior to 1/1/05. In other words, obtaining an AOE/COE report (even a report that found applicant TTD or determined there was no injury AOE/COE) prior to 1/1/05 would require using the old (and significantly more expensive) 1997 PDRS.
Louis Larres, managing attorney of B&B’s Fresno office, wrote in the September/October 2006 B&B Blog that the Torres Commissioners should “Go Back to School.” Mr. Larres provided a brilliant linguistic analysis of Labor Code §4660(d), demonstrating that the Commissioners had put on blinders when applying their narrow interpretation of Labor Code §4660(d).
A few months later, on 1/24/07, the Torres Commissioners received support by way of an en banc decision: Baglione. In a 4-3 decision written by Commissioner Rabine, the WCAB concluded that Labor Code §4660(d)’s phrase “indicating the existence of [PD]” qualifies only the phrase immediately preceding it: “report by a treating physician.” Thus, Baglione determined any comprehensive medical-legal report that issued prior to 1/1/05 (whether or not it found PD, discussed PD, or even found that there was no injury AOE/COE), would be sufficient to place applicant’s PD rating under the old 1997 PDRS.
Taking a lead from Louis Larres, the undersigned declared in the B&B Blog, Q1 2007: “The WCAB is WRONG!” (https://bradfordbarthel.com/the-ramifications-of-pendergrass-baglioni/). It was further noted that Governor Schwarzenegger would soon be replacing Merle Rabine as a Commissioner. The new Commissioner would be the second Schwarzenegger appointee to the WCAB, the first having been Chairman Miller. The B&B Blog projected: “If the new appointee is anything like Chairman Miller, Baglione…[is] ‘on thin ice.'”
The ice melted! Commissioner Rabine was replaced by Commissioner Moresi. Mr. Moresi has 34 years of experience as a defense attorney. Almost immediately after his Senate confirmation, the newly restructured WCAB revisited the Labor Code §4660(d) issue in Baglione II. Comprising the new majority, Commissioners Miller, Cuneo, Brass and Moresi reversed the original Baglione determination: “We hold that for the 1997 Schedule to apply under §4660(d) the existence of permanent disability must be indicated in either a pre-2005 comprehensive medical-legal report or pre-2005 report from a treating physician.” The majority succinctly expressed their shock at the earlier Baglione determination: “We perceive no rationale for delaying use of the 2005 Schedule merely because a comprehensive medical-legal report has issued.”
On 1/24/07, the WCAB issued an en banc decision, Pendergrass vs. SCIF, providing that applicants who are TD prior to 1/1/05 will not be rated pursuant to the 2005 PDRS/AMA Guides (5th). Rather, based on the Pendergrass majority’s interpretation of Labor Code §4660(d), any applicant found to be temporarily disabled prior to 1/1/05 was to be rated pursuant to the 1997 PDRS. This determination was not insignificant; in so doing, the WCAB was effectively increasing the average PD awards by more than 50% (see California Commission on Health and Safety’s “Permanent Disability Schedule Analysis” 2/23/06).
At the heart of the issue was Labor Code §4660(d), which provides that the 2005 PDRS will apply to pre-1/1/05 injuries unless, inter alia, the “employer is…required to provide the notice required by Section 4061 to the injured worker.” A “Section 4061” notice is the “end-of-the-TD-gravy-train” notice that advises the applicant that TD is ending and discusses prospects of PD (that is, PD “will be paid,” “may be or is payable, but that amount cannot be determined” and so on). B&B declared in a B&B Blog article entitled “The Ramifications of Pendergrass and Baglione” that the WCAB is WRONG! “Pendergrass appears to be a clear-cut case of Commissioners being more interested in achieving their own agenda (that is, avoiding the application of the 2005 PDRS/AMA Guides wherever possible) rather than executing the California Legislature’s intent…”
B&B has been vindicated!
The WCAB revisited their earlier decision in Pendergrass II. Again, Commissioner Moresi had replaced Commissioner Rabine. Thus, Commissioner Moresi provided the essential “pivotal swing vote.” Stated the new majority: “Pursuant to the plain language…defendant’s obligation to provide [a Labor Code §4061] notice did not arise until the actual last payment of temporary disability indemnity…” Noting that “the legislature intended that the changes in [SB 899] take effect ‘immediately’ so as to provide relief ‘at the earliest possible time,'” the majority described SB 899 as reflecting “the legislature’s intent to solve the [workers’ compensation crisis] as quickly as possible by bringing as many cases as possible under the umbrella of [SB 899].”
It feels great to be vindicated!
Is Labor Code §4660(d) a Dead Issue?
Unfortunately, the interpretation of Labor Code §4660(d) (insofar as it impacts whether we are to use the old, more expensive 1997 PDRS or the new, objectively-based AMA Guides/2005 PDRS), is still “in the courts.” Thus, while the binding precedents of Baglione II and Pendergrass II are clear at this time, they could change. The Court of Appeals, First District, has granted a writ in Washington Mut. Bank v. WCAB (Helm). This case addresses both Baglione and Pendergrass issues. Further, the Court of Appeals, First District, Third District, and Fifth District have issued writs on Baglione and Pendergrass issues.
In short, we will be monitoring this situation and reporting it to you shortly.
Don Barthel is a co-founder of Bradford & Barthel, LLP and a founder of B&B Rating Services.
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