BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
:
WILLIAM E. SMITH, :
:
Claimant, :
: File No. 976632
vs. :
: A P P E A L
CRST, INC. AND LINCOLN :
SALES AND SERVICE, : D E C I S I O N
:
Employer, :
Self-Insured, :
Defendant. :
___________________________________________________________
The record, including the transcript of the hearing before
the deputy and all exhibits admitted into the record, has been
reviewed de novo on appeal.
ISSUES
The issues on appeal are: whether the Iowa industrial
commissioner has jurisdiction over this matter and, if so, the
extent of claimant's industrial disability. These are the only
issues raised by defendant who is the only appealing party.
Findings of fact and conclusions of law contained in the
arbitration decision that have not been preserved by raising the
issues will not be reviewed. Therefore, the finding and
conclusion that CRST, Inc. and Lincoln Sales and Service had the
same business identity and that claimant was an employee of CRST,
Inc. will be applicable and accepted for purposes of this
decision. Only those facts and the law relevant to the issues
raised on appeal will be considered.
FINDINGS OF FACT
William E. Smith (hereinafter referred to as either Smith or
claimant) was born December 21, 1938 and completed the tenth
grade of high school. He had schooling and training in the Air
Force for four years (1956-1960) and attended a year of
vocational training at Kirkwood Community College (1984) prior to
his employment as a truck driver (Transcript pages 33-39). His
work experience includes working as a butcher for various meat
processing companies (Tr. pp. 40-41 and Joint Exhibit 8); a
materials handler; warehouseman; apartment manager and an
independent contractor delivering telephone books (Jt. Ex. 8 and
Tr. pp. 41-45). He began working for CRST in March 1989 (Jt.
Ex. 8).
Smith went through an employment orientation process in
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Schererville, Indiana and while in Schererville signed documents
relative to becoming an employee (Tr. pp. 118-119). He began
working for CRST as a semi-tractor driver in March 1989. CRST is
an Iowa Corporation that maintains its principal place of
business in Iowa (Claimant's Ex. 2, p. 4; Cl. Ex. 7; and Cl. Ex.
9). CRST is an interstate common and contract motor carrier of
property and it operates under Interstate Commerce Commission
authority (Cl. Ex. 9). CRST maintains terminals in Cedar Rapids,
Iowa; Schererville, Indiana; Richmond, Indiana; and Oklahoma
City, Oklahoma (Tr. pp. 61, 118-119 and Defendant's Ex. L).
When hired, Smith was a resident of Illinois. During the
initial months of the employer-employee relationship Smith did
not reside in Iowa. He did not work out of the employer's Iowa
terminal. He did, however, receive directions from the
dispatcher located in Cedar Rapids, Iowa. Claimant moved to
Cedar Rapids, Iowa in the spring of 1990 and has lived there
since (Tr. p. 58). After he moved to Cedar Rapids, Iowa, he was
dispatched from there (Tr. p. 62).
For dispatch dates from March 13, 1989 through December 28,
1989, Smith was dispatched 169 times. Seventeen of those 169
times either the origination or destination was in Iowa. Nine of
the 169 times involved both origination and destination in Iowa.
For dispatch dates January 1, 1990 through October 22, 1990,
Smith was dispatched 162 times. Twenty-two of these 162 times
either the origination or the destination was in Iowa.
Thirty-one of the 162 times involved both origination and
destination in Iowa. For the trips dispatched in 1990, Cedar
Rapids, Iowa was given as the origination 35 times; Schererville,
Indiana was given as the origination six times; Oklahoma City,
Oklahoma was given as the origination five times; and Richmond,
Indiana was given as the origination twice. For dispatches in
1990 from these four cities, two-thirds (35 out of a total of 48)
were from Cedar Rapids, Iowa (Def. Ex. L).
The trip which eventually resulted in his work-related
injury began from Cedar Rapids, Iowa on October 10, 1990 (Def.
Ex. L and Tr. p. 61). On October 23, 1993 the truck in which
claimant was riding was involved in an accident on an interstate
highway near Salt Lake City, Utah (Tr. p. 65).
Smith had degenerative changes in his spine which preexisted
the October 23, 1990 injury. Extensive care and diagnostic tests
have been conducted. None of the tests have shown any
physiological abnormality which resulted from the injury. The
injury is therefore found to have been an aggravation of the
preexisting degenerative condition and a lumbar sprain or strain.
While the degenerative condition preexisted the injury, it was,
for the most part, asymptomatic. The injury has caused it to
become symptomatic and as a result, it now limits Smith's
physical capabilities.
Smith's original care for the injury was provided by
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orthopedic surgeon Lawrence Strathman, M.D. The recuperation
from the injury, which is the subject of this case, was
compromised by an intervening automobile accident that happened
on or about February 6, 1991 (Def. Ex. D). That automobile
accident produced post-traumatic headaches, a cervical injury and
injury to the claimant's previously injured low back. It is
found that the injury to the low back, that occurred on February
6, 1991, was a further aggravation of the low back injury. Most
of that second aggravation was temporary. The automobile
accident is found to have not produced any significant permanent
or long-term change in the low back condition through it likely
delayed the healing process somewhat. This finding is based upon
the assessments of the case from Lawrence Strathman, M.D.,
Richard F. Neiman, M.D., and Ellen M. Ballard, M.D. Those three
doctors seem to be fairly consistent in their assessment of this
case and their assessments are generally accepted as being
correct. These opinions outweigh any contrary opinion by Daniel
J. McGuire, M.D.
At the time of the February 6, 1991 automobile accident,
Smith was working on a part-time basis performing tasks which
might be described as quite menial. He was working under a
restriction which limited him to 40 pounds of lifting and 40
minutes of sitting without being able to move from the seated
position. The records seem to indicate that he was progressing,
though somewhat slowly (Jt. Ex. 2, pp. 13-14). Dr. Strathman
expected that claimant would eventually have a good recovery
without any long-term effects from the truck accident (Def. Ex.
C, pp. 10-12). By late March Dr. Strathman seemed to be of the
opinion that claimant was not progressing in his recovery. A
functional capacity assessment was conducted on April 8 and 9,
1991 (Def. Ex. C, pp. 20-24). It is therefore found that Dr.
Strathman was correct. It is found that April 9, 1991 marks the
end of the period of time during which further recuperation from
the injury was reasonably anticipated. When looking back at the
record as a whole, a substantial improvement in Smith's
capabilities does not appear to have occurred since April 9,
1991. While it is recognized that there was some improvement in
his range of motion between December 1991 and May 1992, that
improved range of motion does not seem to have produced any
accompanied increase in his physical capabilities. Claimant
attempted care under the direction of Dr. Neiman. While that
care may have provided some benefit to Smith, there is no
indication in the record that it increased his physical
capabilities.
Dr. Neiman diagnosed claimant as being depressed but that
the depression responded to medication. The record does not show
that the depression was disabling or that it, combined with
claimant's other symptoms, were disabling in the sense that they
made claimant any more unfit for work than he had been before the
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onset of the depression or that he was after the depression had
been successfully treated by Dr. Neiman.
It is found that the headaches, cervical and upper back
complaints which limit Smith are not shown to have been caused by
the October 23, 1990 truck accident. When Smith's employability
is assessed as though he had sustained the truck accident, but
had not sustained further injury in the automobile accident, it
is found that the greater weight of the evidence tends to
indicate that he would have had a reasonably good recovery, that
he would have been able to resume full-time employment performing
work with a medium or moderate exertional requirements though he
would have had some restrictions. It is found likely that he
would not have been able to resume over-the-road truck driving
and that he would have continued to have some level of lifting
restriction and some restriction on his ability to remain seated
for extended periods of time.
Dr. Strathman was claimant's treating physician following
the work injury. He noted that claimant's complaints were
somewhat out of proportion to findings and that some of
claimant's limitations were self-limited (Def. Ex. C, pp. 7,
27-28 and Jt. Ex. 3, pp. 44-45, 50). On February 6, 1991 a
therapist gave claimant a release to return to work with a 45
pound lifting restriction and a sitting restriction of 40 minutes
and set a goal of a 50 pound lifting restriction and prolonged
sitting up to two hours (Jt. Ex. 3, p. 38). Dr. Strathman did
not assign claimant a functional impairment rating (Def. Ex. C,
p. 27). Dr. Ballard, who examined claimant on June 15 and June
29, 1993, found that he had a five percent permanent partial
"disability" based on the lumbar strain connected to the truck
accident (Jt. Ex. 4, p. 9). Dr. Neiman's later impairment rating
for claimant's lower back was nine percent (Jt. Ex. 5, p. 44).
In his deposition, taken May 13, 1993, Dr. Neiman was of the
opinion that claimant was incapable of being a cross-county type
of truck driver because of his work-related low back injury, but
was capable of doing short-haul type driving. The restrictions
he indicated for claimant were repetitive lifting of 20-25 pounds
and a maximum of 35-40 pounds four times an hour. Dr. McGuire
examined claimant on April 2, 1992 and found his neurological
examination basically normal and surgery unnecessary (Def. Ex. F,
p. 82).
Claimant was referred to the Kirkwood Community College
Skill Center for the period of August 19, 1992 through April 23,
1993. He was present for 80 days and absent for 68 days. He
completed the program. The counselor, Barbara Mussman, noted
that claimant did not show much drive and motivation nor much
initiative to become employed and at the time of leaving he had
not begun active job seeking (Jt. Ex. 7, pp. 30006-30007).
Another counselor noted on August 20, 1992 that claimant had near
average reading skills but had many math skill deficiencies (Jt.
Page 5
Ex. 7, pp. 300014-300015). When claimant's deposition was taken
on November 19, 1991 he had not made an effort to try to find any
light duty work (Def. Ex. A, p. 44). In his deposition, taken on
April 22, 1993, claimant stated that following his work-related
injury he had applied to only one employer for a job (Def. Ex. B,
p. 74).
CONCLUSIONS OF LAW
The first question to be resolved is whether the Iowa
industrial commissioner has jurisdiction over this matter.
Jurisdiction of the Iowa industrial commissioner for work
injuries suffered outside the state of Iowa is found in Iowa Code
section 85.71. Iowa Code section 85.71 provides in relevant
part:
If an employee, while working outside the
territorial limits of this state, suffers an injury on
account of which the employee, or in the event of
death, the employee's dependents, would have been
entitled to the benefits provided by this chapter had
such injury occurred within this state, such employee,
or in the event of death resulting from such injury,
the employee's dependents, shall be entitled to the
benefits provided by this chapter, provided that at the
time of such injury:
1. The employment is principally localized in this
state, that is, the employee's employer has a place of
business in this or some other state and the employee
regularly works in this state, or if the employee is
domiciled in this state, or
This language has been interpreted and applied.
Applying these principles to section 85.71(1), we
first analyze the language and purpose of the
provision. The express over-all purpose of section
85.71 is to specify employees who are entitled to Iowa
workers' compensation benefits for injuries sustained
during employment outside the territorial limits of
this state....
....
Defining employment that "is principally localized in
this state" to allow benefits to be based exclusively
upon the domicile of the employee, with no part of the
employment relationship either originating or performed
in Iowa would, in our opinion, be arbitrary.
....
The plain meaning of the enacting clause indicates that
the employee must perform the primary portion of his
services for the employer within the territorial
Page 6
boundaries of the State of Iowa or that such services
be attributable to the employer's business in this
state.
....
Accordingly, we hold that domicile in Iowa alone is not
sufficient to entitle an employee who has sustained an
injury outside the state to benefits provided by the
Iowa Workers' Compensation Act. There must be some
meaningful connection between domicile and the
employer-employee relationship....
Iowa Beef Processors, Inc. v. Miller, 312 N.W.2d 530, 533, 534
(Iowa 1981).
[W]e held in Iowa Beef Processors, Inc. v. Miller that
Iowa domicile is insufficient to entitle a worker
injured during the course of employment outside the
state to Iowa benefits, absent some "meaningful
connection between domicile and the employer-employee
relationship."...
Claimant's previous award of benefits under Nebraska
workers' compensation law does not preclude award of
benefits under our compensation law. In workers'
compensation cases it is unnecessary to identify the
jurisdiction with the greatest contacts and interest.
The test is not whether Iowa's interest exceeds or
excludes those of other states, but whether Iowa's
interest is itself sufficient, based on analysis of our
workers' compensation statutes....
....
We must determine whether a meaningful relationship
existed between claimant's Iowa domicile and the
employer-employee relationship....
....
Based on the enacting clause of section 85.71(1), we
ascribed to the legislature an intent that "the
employee must perform the primary portion of his
services for the employer within the territorial
boundaries of the State of Iowa or that such services
be attributable to the employer's business in this
state."...
....
In neither instance were the employee's services
attributable to business transacted in this state, nor
was any portion of the employee's services performed
here....
Page 7
George H. Wentz, Inc. v. Sabasta, 337 N.W.2d 495, 498, 501, 502
(Iowa 1983)
In the case at bar, we, then, must determine whether
a meaningful relationship existed between Orr's Iowa
domicile and his employment with McNair Inc. Our focus
is on the employer-employee relationship and whether
this relation existed within Iowa's boundaries.
None of Orr's services were attributable to any of
McNair Inc.'s business transacted in Iowa. On two
occasions Orr did assist his employer in transporting
equipment from Iowa to Oklahoma. However, he was not
compensated for those tasks and those were not the
services for which he was hired by McNair Inc.
Therefore, we find no meaningful connection between
Orr's domicile and the employer-employee relationship
in this case.
Orr v. McNair, 386 N.W.2d 145, 149 (Iowa App. 1986)
Regarding subsection (1), our supreme court has
held:
[D]omicile in Iowa alone is not sufficient to
entitle an employee who has sustained an
injury outside the state to benefits provided
by the Iowa Workers' Compensation Act. There
must be some meaningful connection between
domicile and the employer-employee
relationship....
However, the court reserved the question of how
substantial that connection must be to be "meaningful"
and merely stated the interpretation of subsection (1)
must be consistent with the model act. Id. The court
had previously noted:
[U]nder the model act employment is localized
in a particular state when the employee
regularly works in the state or is domiciled
in the state and a substantial portion of the
employee's working time is spent serving the
employer in the state.
Ewing v. George A. Hormel & Co., 428 N.W.2d 674, 675 (Iowa App.
1988)
In the instant case claimant moved to Iowa in March 1990.
There is no argument that claimant was domiciled in Iowa at the
time of his October 23, 1990 work-related injury. As the cases
above discuss domicile alone is not enough to trigger
jurisdiction under Iowa Code section 85.71(1). There must also
be some meaningful connection between domicile and the
employer-employee relationship. In this case there is a
meaningful relationship between claimant's Iowa domicile and the
Page 8
employer-employee relationship. The employer had a terminal in
Iowa. The employee would regularly pick up the semi-tractor
trailer he was assigned to drive from that Iowa terminal (See
Def. Ex. L). The employee was dispatched regularly from that
Iowa terminal.
In approximately ten months of calendar year 1990 that the
employee drove, prior to his injury, 19 percent (31 out of 162)
trips had originations and destinations both in Iowa. In this
same ten month period 14 percent (22 out of 162) trips either
originated or concluded in Iowa. The employee regularly drove
trips that originated or concluded in Iowa or both originated and
concluded in Iowa. Two-thirds (35 out of 48) of the times the
employee started a trip from a terminal location it was from the
Cedar Rapids terminal. The trip which ultimately ended in the
employee's work injury originated from Cedar Rapids.
All these factors distinguish the instant case from the
cases cited above where the employees had no or virtually no
relationship with their employment in the state. In this case
there is a meaningful relationship between Smith's domicile and
the employer-employee relationship. A substantial portion of the
employee's working time was spent serving the employer in this
state. The employer-employee relationship existed in Iowa.
Smith's services were regularly attributable to CRST's business
transacted in Iowa. The Iowa industrial commissioner has
jurisdiction over this matter pursuant to Iowa Code section
85.71(1).
The next issue to be resolved is the extent of Smith's
industrial disability.
The party who would suffer loss if an issue were not
established has the burden of proving that issue by a
preponderance of the evidence. Iowa R. App. P. 14(f).
In Guyton v. Irving Jensen Co., 373 N.W.2d 101 (Iowa 1985),
the Iowa court formally adopted the "odd-lot doctrine." Under
that doctrine a worker becomes an odd-lot employee when an injury
makes the worker incapable of obtaining employment in any
well-known branch of the labor market. An odd-lot worker is thus
totally disabled if the only services the worker can perform are
"so limited in quality, dependability, or quantity that a
reasonably stable market for them does not exist." Guyton, 373
N.W.2d at 105.
The burden of persuasion on the issue of industrial
disability always remains with the worker. When a worker makes a
prima facie case of total disability by producing substantial
evidence that the worker is not employable in the competitive
labor market, the burden to produce evidence of suitable
employment shifts to the employer, however. If the employer
fails to produce such evidence and if the trier of fact finds the
worker does fall in the odd-lot category, the worker is entitled
to a finding of total disability. Guyton, 373 N.W.2d at 106.
Even under the odd-lot doctrine, the trier of fact is free to
Page 9
determine the weight and credibility of evidence in determining
whether the worker's burden of persuasion has been carried, and
only in an exceptional case would evidence be sufficiently strong
as to compel a finding of total disability as a matter of law.
Guyton, 373 N.W.2d at 106.
Claimant argues in his appeal brief that he is an odd-lot
employee. Claimant has a limited functional impairment (three to
nine percent) and has not had surgical treatment for his work
injury. Most importantly, Smith has made no meaningful attempt
to gain employment. Making one application and looking at
newspaper ads is not a meaningful employment search. A claimant
must demonstrate a reasonable effort to secure employment as part
of a prima facie showing that his is an odd-lot employee. See
e.g. Emshoff v. Petroleum Transportation and Great West Casualty,
(Appeal Decision, March 31, 1987); Collins v. Friendship Village,
Inc., (Appeal Decision, October 31, 1988); Reed v. Glenwood State
Hospital School, (Appeal Decision May 24, 1991).
Functional impairment is an element to be considered in
determining industrial disability which is the reduction of
earning capacity, but consideration must also be given to the
injured employee's age, education, qualifications, experience and
inability to engage in employment for which the employee is
fitted. Olson v. Goodyear Serv. Stores, 255 Iowa 1112, 125
N.W.2d 251 (1963); Barton v. Nevada Poultry, 253 Iowa 285, 110
N.W.2d 660 (1961).
A finding of impairment to the body as a whole found by a
medical evaluator does not equate to industrial disability.
Impairment and disability are not synonymous. The degree of
industrial disability can be much different than the degree of
impairment because industrial disability references to loss of
earning capacity and impairment references to anatomical or
functional abnormality or loss. Although loss of function is to
be considered and disability can rarely be found without it, it
is not so that a degree of industrial disability is
proportionally related to a degree of impairment of bodily
function.
Factors to be considered in determining industrial dis
ability include the employee's medical condition prior to the
injury, immediately after the injury, and presently; the situs of
the injury, its severity and the length of the healing period;
the work experience of the employee prior to the injury and after
the injury and the potential for rehabilitation; the employee's
qualifications intellectually, emotionally and physically;
earnings prior and subsequent to the injury; age; education;
motivation; functional impairment as a result of the injury; and
inability because of the injury to engage in employment for which
the employee is fitted. Loss of earnings caused by a job
transfer for reasons related to the injury is also relevant.
Likewise, an employer's refusal to give any sort of work to an
impaired employee may justify an award of disability. McSpadden
v. Big Ben Coal Co., 288 N.W.2d 181 (Iowa 1980). These are
matters which the finder of fact considers collectively in
Page 10
arriving at the determination of the degree of industrial
disability.
There are no weighting guidelines that indicate how each of
the factors are to be considered. Neither does a rating of
functional impairment directly correlate to a degree of
industrial disability to the body as a whole. In other words,
there are no formulae which can be applied and then added up to
determine the degree of industrial disability. It therefore
becomes necessary for the deputy or commissioner to draw upon
prior experience as well as general and specialized knowledge to
make the finding with regard to degree of industrial disability.
See Christensen v. Hagen, Inc., Vol. 1 No. 3 State of Iowa
Industrial Commissioner Decisions 529 (App. March 26, 1985);
Peterson v. Truck Haven Cafe, Inc., Vol. 1 No. 3 State of Iowa
Industrial Commissioner Decisions 654 (App. February 28, 1985).
Compensation for permanent partial disability shall begin at
the termination of the healing period. Compensation shall be
paid in relation to 500 weeks as the disability bears to the body
as a whole. Iowa Code section 85.34.
Claimant was 51-years-old when the work injury occurred. He
has not had surgical treatment and has a relatively low
functional impairment rating (three to nine percent). His work
restrictions are consistent with the functional impairment
rating. His prospects for retraining are not good although some
of this relates to his non-work-related auto accident and
resulting physical limitations. His intellectual capabilities
and education are not favorable. He is precluded from doing the
job he was performing at the time of his injury. He cannot
return to long-distance truck driving. His employer has not
rehired him and has not assisted in his vocational
rehabilitation. His work history is primarily manual labor. He
is not motivated to return to work. He has not demonstrated
motivation to be retrained. Because he has not returned to any
work his actual loss of earnings is unknown. When all relevant
factors are considered Smith has suffered a 35 percent industrial
disability as a result of his October 23, 1990 work injury.
WHEREFORE, the decision of the deputy is affirmed.
ORDER
THEREFORE, it is ordered:
That defendants pay William E. Smith eight and six-sevenths
(8 6/7) weeks of compensation for healing period at the rate of
three hundred fifty-one and 70/100 dollars ($351.70) per week
payable commencing February 7, 1991.
That defendants pay William E. Smith healing period and
temporary partial disability compensation based on the weekly
rate of three hundred fifty-one and 70/100 dollars ($351.70) per
week commencing October 23, 1990, and continuing through February
6, 1991. Defendants are entitled to credit for the weekly
Page 11
compensation previously paid under the laws of the state of
Indiana in the amount of three thousand eight hundred eighty-nine
and 20/100 dollars ($3,889.20).
That defendants pay William E. Smith one hundred
seventy-five weeks of compensation for permanent partial
disability at the rate of three hundred fifty-one and 70/100
dollars ($351.70) payable commencing April 10, 1991. Defendants
are entitled to credit in the amount of four thousand four
hundred ten dollars ($4,410.00) for the permanent partial
disability compensation benefits previously paid under the laws
of the state of Indiana.
That all unpaid weekly compensation be paid to William E.
Smith in a lump sum together with interest pursuant to section
85.30 computed from the date each payment came due until the date
of its actual payment.
That claimant receive nothing in the way of additional
benefits under the provisions of the fourth unnumbered paragraph
of section 86.13 of the Code of Iowa.
That defendants shall pay the costs of this matter including
transcription of the hearing and shall reimburse claimant for the
filing fee if previously paid by claimant.
That defendant shall file claim activity reports as required
by this agency pursuant to rule 343 IAC 3.1(2).
That all benefits, interest and costs awarded in this
decision are assessed against defendants jointly and severally.
Signed and filed this ____ day of June, 1994.
________________________________
BYRON K. ORTON
INDUSTRIAL COMMISSIONER
Page 12
Copies To:
Mr. Thomas Wertz
Attorney at Law
4089 21st Ave SW STE 114
Cedar Rapids IA 52404
Mr. Chris J. Scheldrup
Attorney at Law
2720 First Ave NE
PO Box 1943
Cedar Rapids IA 52406-1943
1803; 2303
Filed June 24, 1994
BYRON K. ORTON
BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
WILLIAM E. SMITH,
Claimant,
File No. 976632
vs.
A P P E A L
CRST, INC. AND LINCOLN
SALES AND SERVICE, D E C I S I O N
Employer,
Self-Insured,
Defendant.
___________________________________________________________
1803
Poorly motivated claimant who was, nevertheless, foreclosed
from over-the-road truck driving awarded 35 percent
permanent partial disability. Claimant was 51-years-old at
time of work injury to his lower back.
2303
Claimant was an Iowa resident who drove over-the-road for
employer both within and out of the State of Iowa. Work
accident occurred in Utah. Employee regularly drove in Iowa
and drove from a terminal located in Cedar Rapids. Employee
regularly had trips either originate in Iowa or end in Iowa
or both originate and end in Iowa. There was a meaningful
relationship between the employee's domicile and the
employer-employee relationship. Iowa had jurisdiction over
this claim pursuant to Iowa Code section 85.71(l).
BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
:
WILLIAM E. SMITH, :
:
Claimant, : File No. 976632
:
vs. : A R B I T R A T I O N
:
CRST, INC. and LINCOLN SALES : D E C I S I O N
AND SERVICE, :
:
Self-Insured, :
Employer, :
Defendant. :
___________________________________________________________
STATEMENT OF THE CASE
This is a proceeding in arbitration brought by William
E. Smith against CRST, Inc., and Lincoln Sales and Service
based upon an injury that occurred on October 23, 1990.
Smith seeks compensation for healing period, permanent
disability and a penalty under section 86.13 of the Code.
The other issues in the case involve whether or not CRST,
Inc., is an employer of the claimant and whether the State
of Iowa has subject matter jurisdiction of this claim.
Based upon the subject matter jurisdiction issue
determination there is also an issue with regard to the rate
of compensation which should be paid depending upon whether
Iowa or Indiana law controls.
This case was heard in Cedar Rapids, Iowa, on August
10, 1993. The record consists of testimony from William E.
Smith, joint exhibits 1 through 8, claimant's exhibits 1
through 12, and defendants' exhibits A through I, L and N.
Official notice was taken of the motions which are part of
the agency file.
EMPLOYER-EMPLOYEE RELATIONSHIP
Issue: Smith asserts that CRST, Inc., was his employer
at the time of the injury. CRST, Inc., denies the existence
of an employer-employee relationship, but Lincoln Sales and
Service admits that it was Smith's employer.
Findings of Fact: William E. Smith went to truck
driving school and then applied to drive a truck for CRST,
Inc., working through Lincoln Sales and Service. The actual
application and other paper work associated with the hiring
all name Lincoln Sales and Service as the employer. Lincoln
Sales and Service then leased its employees to CRST, Inc.,
to drive the trucks used by CRST, Inc., in its trucking
business. Lincoln Sales and Service performs no other
substantial functions other than to hire and supply drivers
to CRST, Inc. It does not supply drivers to any other
trucking companies. Exhibit 9 which is entitled "Operating
and Service Agreement" provides the written contract between
Page 2
CRST, Inc., and Lincoln Sales and Service under which
drivers were purportedly leased. It is particularly noted
that with regard to paragraph five as far as selecting
routes and controlling the activities of drivers that these
are all matters which were performed by CRST, Inc., not by
Lincoln Sales and Service, despite the terms of the
agreement to the contrary. It is further interesting to
note, as shown in exhibit 8, that Lincoln Sales and Service
contracted with CRST, Inc., in order to have CRST, Inc.,
manage and operate Lincoln Sales and Service. Examination
of exhibit 7 shows that Lincoln Sales and Service and CRST,
Inc., are both Iowa corporations which have (1) the same
corporate address, (2) the same registered agent whose
address is at the office of the corporations and (3) the
same person serves as secretary treasurer for both
corporations. Exhibit 7 further shows that the majority of
the persons who serve as either officer or director of one
of the corporations also serves as an officer or director of
the other.
The day-to-day activities that Smith performed as a
truck driver were exclusively within the control of CRST,
Inc. It told him where to go, when to go, what truck to
drive, and what route to follow. CRST, Inc., gave him
commendations and awards when he performed well (ex. 12, pp.
7-8). It reprimanded him with warnings when he was not
performing well (ex. 12, pp. 1, 4, 6). Lincoln Sales and
Service also exercised the right to impose discipline on
Smith (ex. 12, p. 5).
It is clear from the record in this case that there
were no arms length transactions between CRST, Inc. and
Lincoln Sales and Service. Both corporations were
controlled and operated by the same individuals. They
operated as if they were one business with Lincoln Sales and
Service being merely a personnel office for CRST, Inc.
Lincoln Sales and Service functioned merely as a conduit
between CRST, Inc. and the persons who drove CRST, Inc.'s
trucks. CRST, Inc. paid money to Lincoln Sales and Service
which in turn paid the salaries to the drivers such as
Smith. It is clear that a great deal of effort was expended
in drafting lengthy and complex documents such as exhibits 8
and 9, yet when the actual day-to-day operations are viewed
it is clear that the two entities operated as though they
were one. Lincoln Sales and Services merely functioned as a
conduit. It had no other reason for existence and performed
no other function. Since CRST, Inc., actually operated
Lincoln Sales and Service and Lincoln Sales and Service did
not do business with any trucking company other than CRST,
Inc., it is clear that Lincoln Sales and Service was not
engaged in independent business. It is noted that CRST,
Inc. even provided the facilities and equipment with which
Lincoln Sales and Service operated (ex. 8, paragraph 5).
The fact that the employment arrangement with the drivers
contained a provision that all workers' compensation claims
would be covered by the state of Indiana is a very strong
Page 3
indication that Lincoln Sales and Service existed only as a
device through which CRST, Inc., attempted to avoid the
workers' compensation laws of the state of Iowa as the same
applied to the persons who functioned as employees of CRST,
Inc.
It is clear from the record made in this case that
Lincoln Sales and Service is not a bona fide good faith
independent business entity. It is merely a sham which was
created solely for the purpose of enabling CRST, Inc., to
avoid its legal obligations under the Iowa worker's
compensation laws and perhaps other laws and regulations of
the state and federal governments which come into play based
upon the existence of an employer-employee relationship. It
is recognized that there are some good faith independent
employee leasing businesses, such as Manpower, Inc. and
Kelly Services, but Lincoln Sales and Service was not one of
them. Lincoln Sales and Service was merely the alter-ego of
CRST, Inc. It is noted that even in the defense of this
proceeding CRST, Inc. and Lincoln Sales and Service are
represented by the same attorney.
Conclusions of Law: The law dealing with leased
employees is developing. It is a well regarded proposition
that the employee of an independent contractor is not to be
considered an employee of the general contractor. Krueger
v. Iowa Rails to Trails, Inc., 435 N.W.2d 391 (Ia. App.
1988); Bashford v. Slater, 252 Iowa 726, 108 N.W.2d 474
(1961); Larson, Workmen's Compensation Law, 85.61(3)(b).
That rule is not applicable in this case however, because
Lincoln Sales and Service was not an independent contractor.
It functioned exclusively as an arm of CRST, Inc. The facts
in this case are much like those in the case Crane v. Meier,
332 N.W.2d 344 (Iowa 1982). Meier was hired by a person by
the name of Werner. Werner had a contract with Crane which
provided that Werner could not perform work for other siding
companies. Crane exercised control over the employees hired
by Werner. It was held that Werner therefore had authority
to hire employees to do the work for Crane Siding Company.
Despite the fact that Werner had the authority to hire and
fire those employees, Meier was nevertheless held to be an
employee of Crane.
Section 85.18 of the Code states: "No contract, rule,
or device whatsoever shall operate to relieve the employer,
in whole or in part, from any liability created by this
chapter except as herein provided." It is clear that CRST,
Inc., went to a great deal of trouble and expense to create
Lincoln Sales and Service for no apparent purpose other than
to avoid workers' compensation liability and other legal
obligations which arise when an employer-employee
relationship exists. It is clear that CRST, Inc., was the
employer of William E. Smith.
Further the law dealing with identifying employers when
leased employees are the issue seems to be developing into a
quite logical, workable and fair status as evidenced by the
case Jones v. Sheller-Globe, Corp., 487 N.W.2d 88 (Iowa App.
Page 4
1992). In those situations the employee is prohibited by
the exlusive remedy provisions at section 85.20 from
bringing a tort action against both the labor broker and the
employer for whom the services are being performed. The
workers' compensation recovery is the exclusive remedy only
as to claims against the employer. If either were allowed
to escape from the workers' compensation remedy, then the
one which escaped liability under workers' compensation laws
should be subjected to liability under the tort laws. The
better rule is that both are employers and that they are
jointly and severally liable under the workers' compensation
laws for the injury sustained by the employee. This
situation is not greatly different than that in Carlson v.
Carlson, 346 N.W.2d 525 (Iowa 1984) and Beck v. Rounds, 332
N.W.2d 109 (Iowa App. 1982). It is in the public interest
that all employees be covered by workers' compensation
insurance. If either of the two employers defaults in its
obligation then the employee should be free to seek recovery
from the other. The two employers should be free to
contract between themselves as to which will actually pay
the premiums for purchasing the insurance but it is
incumbent upon them to be certain that the insurance is in
fact purchased since if one defaults in its portion of the
obligation the other will be left holding the bag. Those
two employers are in a much better position to be able to
acquire and monitor the activities of purchasing the
insurance than is the employee. If someone is to suffer
from a breach of the agreement between the two employers,
then it should be the employers who made the agreement. The
benefits paid by one should satisfy the obligations of both.
(There is some question about whether permanent or
indefinite leased employees should be treated differently
than temporaries. A reasonable argument can be made that
the short-term temporary employee is an employee only of the
labor broker. In this case, however, it is clear that
William Smith was not a temporary. He was hired to drive
indefinitely for CRST, Inc.)
It is therefore concluded that under any view of the
facts in this case it is clear that William E. Smith was an
employee of CRST, Inc., for purposes of workers'
compensation as well as an employee of Lincoln Sales and
Service.
SUBJECT MATTER JURISDICTION-SECTION 85.71
Issue: Smith contends that Iowa has subject matter
jurisdiction of his claim. Defendants assert that Indiana
is the proper forum.
Findings of Fact: It is clear, regardless of the fact
that CRST is actually the employer and that Lincoln Sales
and Service was acting as its agent or representative, that
the contract of hire was made in the state of Indiana. When
hired, Smith was a resident of Illinois. During the initial
months of the employer-employee relationship Smith did not
reside in Iowa. He did not work out of the employer's Iowa
terminal. He did, however, receive directions from the
Page 5
dispatcher located in Cedar Rapids, Iowa.
Smith then moved to Cedar Rapids, Iowa. He was
dispatched out of Cedar Rapids, Iowa. He parked his truck
at the employer's main terminal at Cedar Rapids, Iowa, when
he was off duty. Iowa became Smith's principle place of
residence and his domicile. Smith was residing at Cedar
Rapids, Iowa, and had been dispatched from Cedar Rapids,
Iowa, when the injury which performs the basis for this case
occurred. The injury was a traumatic event which occurred
in the state of Utah. Following the injury, Smith returned
to Iowa and received medical care in the state of Iowa.
Smith was paid workers' compensation benefits under the
Indiana statues. Apparently these were voluntary payments
and it is not known whether or not Indiana actually has
subject matter jurisdiction.
Conclusions of Law: Subject matter jurisdiction for
injuries which occur outside of this state must be based
under section 85.71 of the Code. At the outset, it is clear
that the facts are such that subsections three and four are
not applicable. The fact that payments were paid under the
laws of Indiana do not conclusively establish that the
Indiana workers' compensation laws are applicable but it is
a strong indication of such. This analysis is made assuming
that Indiana does have jurisdiction. It is also made based
upon the assumption that the state of Utah, where the
accident occurred, likewise has jurisdiction.
It must be recognized at the outset that subsection one
of section 85.71 is somewhat unclear and can be given
various interpretations. The Iowa statute is not completely
consistent with either Restatement (second) of Conflict of
Laws, section 181 or Counsel Of State Governments Model Act
Comprehensive Workman's Compensation Rehabilitation Law,
section 7(d)(4)(1963). The term "principally localized" can
be given different meanings. The last phrase of subsection
one which reads "...or if the employee is domiciled in this
state,..." constitutes a phrase which has not been
interpreted by the Iowa courts. It is certain that the
employer, be it CRST, Inc., or Lincoln Sales and Service,
certainly has a place of business in Cedar Rapids, Iowa. It
is further certain that Smith regularly received directions
regarding the employment activities he was directed to
perform from the Cedar Rapids terminal. We thus have a case
in which the employer had a place of business in the state
of Iowa, the employee regularly worked from that place of
business and the employee was domiciled in this state.
This issue is discussed at length in 4 Larson,
Workmen's Compensation Law, 87.42-87.71. Much was made at
hearing about the fact that the employer required Smith to
sign a document, as part of his employment application
process, which states that workers' compensation issues will
be handled under the laws of the state of Indiana. It is
well recognized that such a provision is void and illegal.
It violates section 85.18 of the Code of Iowa. Such a
provision is simply ineffectual (4 Larson, 87.71, 85.72).
Page 6
Simply stated, parties cannot, by contract, alter the
statutory plan for jurisdiction in workers' compensation
cases. While William Smith might not have sufficient
knowledge and expertise to understand that fact, it is clear
that an employer such as CRST, Inc., would be fully aware of
the illegality of that contractual provision.
It is well established that the mere domicile of an
employee in this state is not sufficient to grant
jurisdiction. George H. Wentz, Inc. v. Sebasta, 337 N.W.2d
495 (Iowa 1983); Iowa Beef Processors, Inc. v. Miller, 312
N.W.2d 530 (Iowa 1981); Ewing v. Geo. A. Hormel and Co., 428
N.W.2d 674 (Iowa App. 1988); and Orr v. McNair, 386 N.W.2d
145 (Iowa App. 1986). Nevertheless, it is recognized that
in appropriate situations the place of residence or domicile
of the employee is a factor to be considered (4 Larson,
87.60). The inclusion of the last four words in subsection
one of section 85.71 dealing with domicile in this state is
a statutory indication that the domicile of the employee is
a factor.
Another factor is the location of the employer's
business. Employer in this case is in the business of truck
transportation. It operates across the country though its
principle office and principle terminal is in Cedar Rapids,
Iowa. The location of the employer's place of business and
the significance of its operations in this state are another
factor (4 Larson, 87.42 - 87.71). It can reasonably be
urged that a situation such as the one in this case, where
the employer has its principle place of business in this
state, the employee is domiciled in this state and the
employee regularly works from the employer's principle place
of business in this state constitutes sufficient facts to
make the employment principally localized in this state.
The interest of this state in this case is certainly
substantial since both the employer and employee are
residents and domiciliaries of this state. While the
overwhelming majority of the work was actually performed
outside of the state of Iowa, the direction and control of
the work was transmitted to Smith and other CRST employees
from Cedar Rapids, Iowa. The brain or control center for
the work remained in Cedar Rapids, Iowa. Smith's job was to
travel but the routes started and ended in Iowa. This case
is unlike Orr, 386 N.W.2d 145, because the Iowa business
location of that employer was of insignificant importance
with regard to the employee's work and work assignment. In
this case, Smith's relationship with the state of Iowa is
much more substantial since there is a continuing and
recurring relationship with the state of Iowa since Iowa is
the base of operations. Hiller v. Workman's Compensation
Appeal Board, 569 A. 2d 1024 (Pa. Commw. Ct. 1990). In this
case it is clear that regardless of whether dealing with
Indiana or Iowa the employment contract did not provide for
all of the work to be performed outside of the state in
which the contract was made. Nevertheless, in those cases
much weight is given to the center or base of operations
Page 7
from which directions are given and from which control is
exercised [4 Larson, 87.42(c-e)].
Much litigation has occurred over the years attempting
to pinpoint the place at which a contract of hire is entered
into. Numerous fictions have been made based supposedly
upon factual matters such as who made the final acceptance
or from where the person spoke when making that final
acceptance of an offer. The ultimate fact of the matter is
that a contract of hire which is made when the parties are
located in different states at the time of the negotiations,
final offer and acceptance is made in both states from which
the parties speak. Who gets in the last word should not
control the legal rights and responsibilities which flow
from the employment relationship.
A contract of hire, once made, is not concrete and
unyielding. Like any other contract it can be rescinded,
renegotiated or modified. As indicated in cases such as
Ewing the place of the making of a contract of hire is
subject to change every time any term of the contract of
hire is altered. In this case, the initial contract of hire
was made in the state of Indiana. It is possible that some
directives may have emanated from Cedar Rapids, Iowa, but
whether or not they did is not critical to the outcome. The
fact critical to the outcome is that the contract of hire
was altered and remade when Smith moved to Cedar Rapids,
Iowa. It was at that time he became an Iowa domiciliary and
operated out of the Iowa CRST terminal. If his work as an
over-the-road truck driver is characterized as "not
principally localized in any state," the state of Iowa has
jurisdiction since the contract of hire under which he was
working at the time of injury was made in Cedar Rapids,
Iowa. It is a contract separate and distinct from the
earlier contract which was made in the state of Indiana. It
is very reasonable to urge, though unnecessary to decide,
that the state of Indiana lost jurisdiction at the time the
contract of hire was changed. It is clear that Smith no
longer worked out of the Indiana terminal at the time of his
injury. There was no significant contact between Smith's
employment and the state of Indiana, other than for the fact
that CRST chose to have a location in the state of Indiana
where some employee files were maintained and from which
payroll was computed and checks were issued. The location
from which a paycheck is issued is of very minor
significance. The location to which it is sent is of
significantly greater significance. Johnson v. United
Airlines, 550 So. 2nd 124 (Fla. Dist. Ct. App. 1989) reh'g
denied (Nov. 13, 1989). The doctrine of changing the place
of the situs of employment is approved in 4 Larson,
87.42(a).
It is therefore concluded that the state of Iowa has
subject matter jurisdiction of this case. This is so
because the employment was principally localized in this
state by virtue of the fact that the employer's main office
and principal terminal is located in Cedar Rapids, Iowa,
Page 8
that Smith worked from that terminal at the time of his
injury and that Smith was a resident and domiciliary of the
state of state of Iowa at the time of his injury. Further,
if it were to be held that the employment was not
principally localized in any state since a majority of
Smith's working time was not spent in any single state,
jurisdiction can be based upon section 85.71(2) because the
contract of hire was made when Smith changed from operating
out of the Indiana terminal to the Cedar Rapids, Iowa,
terminal. That act constituted a substantial change in the
contract of hire and in fact resulted in a new or amended
contract of hire being made. That contract of hire was made
in the state of Iowa.
Healing period and permanent partial disability
Issues: There is a dispute as to whether the healing
period was properly ended on or about February 9, 1991, or
whether it should continue, as claimant contends, until
December 18, 1991. There is also a dispute with regard to
the extent of permanent disability compensation which should
be payable with the claimant contending he is totally
disabled with reliance on the odd-lot doctrine and with
defendants asserting that the disability is minimal.
Findings of Fact: William E. Smith had degenerative
changes in his spine which preexisted the October 23, 1990
injury. Extensive care and diagnostic tests have been
conducted. None of the tests have shown any physiological
abnormality which resulted from the injury. The injury is
therefore found to have been an aggravation of the
preexisting degenerative condition and a lumbar sprain or
strain. While the degenerative condition preexisted the
injury, it was, for the most part, asymptomatic. The injury
has caused it to become symptomatic and as a result, it now
limits Smith's physical capabilities.
Smith's original care for the injury was provided by
orthopedic surgeon Lawrence Strathman, M.D. The
recuperation from the injury which is the subject of this
case was compromised by an intervening automobile accident
that happened on or about February 6, 1991 (ex. D). That
automobile accident produced posttraumatic headaches, a
cervical injury and injury to the claimant's previously
injured low back. It is found that the injury to the low
back that occurred on February 6, 1991, was a further
aggravation of the low back injury. Most of that second
aggravation was temporary. The automobile accident is found
to have not produced any significant permanent or long-term
change in the low back condition through it likely delayed
the healing process somewhat. This finding is based upon
the assessments of the case from Lawrence Strathman, M.D.,
Richard F. Neiman, M.D., and Ellen M. Ballard, M.D. Those
three doctors seem to be fairly consistent in their
assessment of this case and their assessments are generally
accepted as being correct. Daniel J. McGuire, M.D., is a
physician to whom defendants commonly refer patients with
back injuries. Dr. McGuire has a pattern in cases before
Page 9
this agency of providing the assessment which is the most
favorable to the defendants in comparison to assessments
from all the other physicians who are involved in the cases.
His assessments on issues of causation, impairment ratings
and activity restrictions in cases before this agency are
commonly more favorable to the defense of the case than that
of any other physician involved in the case. Accordingly,
the weight given to his assessments is reduced accordingly.
The fact that defendants would send someone from Cedar
Rapids, Iowa, to Des Moines for an assessment by Dr. McGuire
is a strong indication that they expect an assessment which
is very favorable to them when a number of well regarded
orthopedic surgeons are available in the Cedar Rapids-Iowa
City area. Accordingly, Dr. McGuire's assessment is
rejected where it differs from that of the other physicians.
At the time of the February 6, 1991, automobile
accident, Smith was working on a part-time basis performing
tasks which might be described as quite menial. He was
working under a restriction which limited him to 40 pounds
of lifting and 40 minutes of sitting without being able to
move from the seated position. The records seem to indicate
that he was progressing, though somewhat slowly, (jt. ex. 2,
pp. 13-14), Dr. Strathman expected that claimant would
eventually have a good recovery without any long-term
effects from the truck accident (def. ex. C, pp. 10-12). By
late March Dr. Strathman seemed to be of the opinion that
claimant was not progressing in his recovery. A functional
capacity assessment was conducted on April 8 and 9, 1991
(def. ex. C, pp. 20-24). It is therefore found that Dr.
Strathman was correct. It is found that April 9, 1991,
marks the end of the period of time during which further
recuperation from the injury was reasonably anticipated.
When looking back at the record as a whole, a substantial
improvement in Smith's capabilities does not appear to have
occurred since April 9, 1991. While it is recognized that
there was some improvement in his range of motion between
December 1991 and May 1992, that improved range of motion
does not seem to have produced any accompany increase in his
physical capabilities. Claimant attempted care under the
direction of Dr. Neiman. While that care may have provided
some benefit to Smith, there is no indication in the record
that it increased his physical capabilities.
Dr. Neiman diagnosed claimant as being depressed but
that the depression responded to medication. The record
does not show that the depression was disabling or that it,
combined with claimant's other symptoms, were disabling in
the sense that they made claimant anymore unfit for work
than he had been before the onset of the depression or that
he was after the depression had been successfully treated by
Dr. Neiman.
It is found that the headaches, cervical and upper back
complaints which limit William Smith are not shown to have
been caused by the October 23, 1990 truck accident. When
Smith's employability is assessed as though he had sustained
Page 10
the truck accident, but had not sustained further injury in
the automobile accident, it is found that the greater weight
of the evidence tends to indicate that he would have had a
reasonably good recovery, that he would have been able to
resume full-time employment performing work with a medium or
moderate exertional requirements though he would have had
some restrictions. It is found likely that he would not
have been able to resume over-the-road truck driving and
that he would have continued to have some level of lifting
restriction and some restriction on his ability to remain
seated for extended periods of time.
Conclusions of Law: A personal injury contemplated by
the workers' compensation law means an injury, the
impairment of health or a disease resulting from an injury
which comes about, not through the natural building up and
tearing down of the human body, but because of trauma. The
injury must be something which acts extraneously to the
natural processes of nature and thereby impairs the health,
interrupts or otherwise destroys or damages a part or all of
the body. Although many injuries have a traumatic onset,
there is no requirement for a special incident or an unusual
occurrence. Injuries which result from cumulative trauma
are compensable. McKeever Custom Cabinets v. Smith, 379
N.W.2d 368 (Iowa 1985); Olson v. Goodyear Serv. Stores, 255
Iowa 1112, 125 N.W.2d 251 (1963); Ford v. Goode, 240 Iowa
1219, 38 N.W.2d 158 (1949); Almquist v. Shenandoah
Nurseries, Inc., 218 Iowa 724, 254 N.W. 35 (1934). An
occupational disease covered by chapter 85A is specifically
excluded from the definition of personal injury. Iowa Code
section 85.61(5); Iowa Code section 85A.8.
Aggravation of a preexisting condition is one manner of
sustaining a compensable injury. While a claimant is not
entitled to compensation for the results of a preexisting
injury or disease, its mere existence at the time of a
subsequent injury is not a defense. Rose v. John Deere
Ottumwa Works, 247 Iowa 900, 76 N.W.2d 756 (1956). If the
claimant had a preexisting condition or disability that is
materially aggravated, accelerated, worsened or lighted up
so that it results in disability, claimant is entitled to
recover. Nicks v. Davenport Produce Co., 254 Iowa 130, 115
N.W.2d 812 (1962); Yeager v. Firestone Tire & Rubber Co.,
253 Iowa 369, 112 N.W.2d 299 (1961).
Section 85.34(1) provides that healing period benefits
are payable to an injured worker who has suffered permanent
partial disability until (1) the worker has returned to
work; (2) the worker is medically capable of returning to
substantially similar employment; or (3) the worker has
achieved maximum medical recovery. The healing period can
be considered the period during which there is a reasonable
expectation of improvement of the disabling condition. See
Armstrong Tire & Rubber Co. v. Kubli, 312 N.W.2d 60 (Iowa
Ct. App. 1981). Healing period benefits can be interrupted
or intermittent. Teel v. McCord, 394 N.W.2d 405 (Iowa
1986).
Page 11
It has been found that the claimant's recuperation
from the injury was substantially completed on April 9,
1991, and that he thereafter did not make any noticeable
improvement in his physical capabilities. It is therefore
concluded that his entitlement to healing period
compensation ends on April 9, 1991. Pitzer v. Rowley, No.
290/92-776, Iowa Supreme Court (October 10, 1993). In this
case is can be reasonably urged that the care from Dr.
Neiman should extend the healing period. It certainly
appears as though it was reasonable to attempt further
treatment but it cannot be said that the success was
particularly probable or expected. In view of the amount of
time that had elapsed since the original injury, the change
of care from Dr. Neiman being successful was merely
possibly, not probable. That care therefore does not
constitute a basis for extending the healing period
entitlement, particularly where it was unsuccessful from the
view point of its impact in enabling claimant to return to
work.
In view of the intervening automobile accident, the
claimant's failure to return to work was not voluntary. It
does not constitute a basis for terminating benefits. He is
therefore entitled to recover full healing period
compensation benefits from February 6, 1991 through April 9,
1991.
Industrial disability or loss of earning capacity is a
concept that is quite similar to impairment of earning
capacity, an element of damage in a tort case. Impairment
of physical capacity creates an inference of lessened
earning capacity. The basic element to be determined,
however, is the reduction in value of the general earning
capacity of the person, rather than the loss of wages or
earnings in a specific occupation. Post-injury earnings
create a presumption of earning capacity. The earnings are
not synonymous with earning capacity and the presumption may
be rebutted by evidence showing the earnings to be an
unreliable indicator. Bearce v. FMC Corp., 465 N.W.2d 531
(Iowa 1991); DeWall v. Prentice, 224 N.W.2d 428, 435 (Iowa
1974); Carradus v. Lange, 203 N.W.2d 565 (Iowa 1973);
Holmquist v. Volkswagon of America, Inc., 261 N.W.2d 516
(Iowa App. 1977) A.L.R.3d 143; Michael v. Harrison County,
Thirty-fourth Biennial Report of the Industrial Commissioner
218 (1979); 2 Larson Workmen's Compensation Law, sections
57.21 and 57.31.
Total disability does not mean a state of absolute
helplessness. Permanent total disability occurs where the
injury wholly disables the employee from performing work
that the employee's experience, training, education,
intelligence and physical capacities would otherwise permit
the employee to perform. See McSpadden v. Big Ben Coal Co.,
288 N.W.2d 181 (Iowa 1980); Diederich v. Tri-City Ry. Co.,
219 Iowa 587, 258 N.W. 899 (1935).
A finding that claimant could perform some work despite
claimant's physical and educational limitations does not
Page 12
foreclose a finding of permanent total disability, however.
See Chamberlin v. Ralston Purina, File No. 661698 (App.
October 29, 1987); Eastman v. Westway Trading Corp., II Iowa
Industrial Commissioner Report 134 (App. 1982).
In Guyton v. Irving Jensen Co., 373 N.W.2d 101 (Iowa
1985), the Iowa court formally adopted the "odd-lot
doctrine." Under that doctrine a worker becomes an odd-lot
employee when an injury makes the worker incapable of
obtaining employment in any well-known branch of the labor
market. An odd-lot worker is thus totally disabled if the
only services the worker can perform are "so limited in
quality, dependability, or quantity that a reasonably stable
market for them does not exist." Guyton, 373 N.W.2d at 105.
The burden of persuasion on the issue of industrial
disability always remains with the worker. When a worker
makes a prima facie case of total disability by producing
substantial evidence that the worker is not employable in
the competitive labor market, the burden to produce evidence
of suitable employment shifts to the employer, however. If
the employer fails to produce such evidence and if the trier
of fact finds the worker does fall in the odd-lot category,
the worker is entitled to a finding of total disability.
Guyton, 373 N.W.2d at 106. Even under the odd-lot
doctrine, the trier of fact is free to determine the weight
and credibility of evidence in determining whether the
worker's burden of persuasion has been carried, and only in
an exceptional case would evidence be sufficiently strong as
to compel a finding of total disability as a matter of law.
Guyton, 373 N.W.2d at 106.
The demeanor exhibited by William Smith at hearing is
consistent with the comments made in the discharge report
from Kirkwood Community College dated May 7, 1993 (ex. 7).
Claimant does not show much drive or motivation. He likely
has been compliant with instructions given to him but has
not shown any initiative on his own as far as significant
attempts to resume employment. The case is one in which the
anatomical and physiological results of the injury appear to
be minimal. They do appear, however, to have been
sufficient to make over-the-road, long distance truck
driving beyond the claimant's physical capabilities. As
shown by the wages Smith earned in this case that occupation
provides a very good rate of earnings in comparison to other
occupations which would be expected to be available to a
person with Smith's education and general work
qualifications. The fact that he can no longer engage in
over-the-road truck driving, his preferred occupation, is
convincing evidence that he has experienced a significant
loss of earning capacity. In view of the fact that his
efforts at obtaining re-employment have been less than
stellar, the fact of his current unemployment is given
little weight in the assessment of this case. Smith is
capable of working, though his physical capabilities are
certainly less than they were prior to the injury which is
the subject of this case. The case must be assessed based
Page 13
upon the best evidence available as though the February
automobile accident had not occurred. The subsequent slip
and fall does not appear to have been a significant injury
based upon the records which are in evidence.
When considering this claimant's loss of access to his
chosen career field, as well as all the other material
factors affecting industrial disability, it is determined
that William E. Smith sustained a 35 percent permanent
partial disability as a result of the October 23, 1990 truck
accident. This entitles him to recover 175 weeks of
permanent partial disability compensation payable commencing
April 10, 1991. The amount past due and owing draws
interest at the rate of 10 percent per annum pursuant to
section 85.30 of the Code.
RATE OF COMPENSATION AND CREDITS
Issues: The parties stipulated to claimant's rate of
earnings as providing a gross average weekly wage of $626.19
per week. Claimant contends that the rate should be based
on the Iowa benefit booklet while defendants contend that
the law of the state of Indiana should be controlling.
Findings of Fact: It is found that the stipulation is
correct. It was further stipulated that claimant was single
and entitled to one exemption. It was also stipulated that
claimant had been paid weekly benefits under the laws of the
state of Indiana in the amount of $3,889.20 for temporary
total and temporary partial disability. It was further
stipulated that he was paid $4410 in permanent partial
disability compensation benefits.
Conclusions Of Law: Since it has been determined that
the state of Iowa has jurisdiction of this proceeding, it
only follows that Iowa law controls all portions of the
proceeding. It was further stipulated that Smith was single
and entitled to one exemption, therefore, based upon
earnings of $626.19 per week, the correct weekly rate of
compensation is $351.70 per week. The law is well settled
that benefits paid under the laws of another state are
entitled to full faith and credit when concurrent
jurisdiction exits, as it does in this case. Defendants are
therefore entitled to credit for all amounts paid under the
laws of the state of Indiana regardless of whether or not
those amounts were correct and regardless of whether or not
the state of Indiana actually had jurisdiction. Thomas v.
Washington Gas Light Co., 448 U.S. 261 100 S. Ct. 2647, 65
L.Ed. 2nd 757 (1980); Wentz, 337 N.W.2d 495. It has also
been held that this agency has no statutory authority to
apply the law of another jurisdiction when deciding a case
in this jurisdiction. Snyder v. Continental Grain Co., II-1
Iowa Industrial Commissioner Decisions 363 (1985).
PENALTY
Findings of Fact: There was a bona fide good faith
dispute with regard to whether or not the state of Iowa had
subject matter jurisdiction over this claim.
Page 14
Conclusions of Law: In view of the bona fide good
faith dispute, there is no basis of imposition of a penalty.
Covia v. Robinson, No. 302/92-1769, Iowa Supreme Court
(Iowa 1993).
ORDER
IT IS THEREFORE ORDERED that defendants pay William E.
Smith eight and six-sevenths (8 6/7) weeks of compensation
for healing period at the rate of three hundred fifty-one
and 70/100 dollars ($351.70) per week payable commencing
February 7, 1991.
It is further ordered that defendants pay William E.
Smith healing period and temporary partial disability
compensation based on the weekly rate of three hundred
fifty-one and 70/100 dollars ($351.70) per week commencing
October 23, 1990, and continuing through February 6, 1991.
Defendants are entitled to credit for the weekly
compensation previously paid under the laws of the state of
Indiana in the amount of three thousand eight hundred
eighty-nine and 20/100 dollars ($3,889.20).
It is further ordered that defendants pay William E.
Smith one hundred seventy-five weeks of compensation for
permanent partial disability at the rate of three hundred
fifty-one and 70/100 dollars ($351.70) payable commencing
April 10, 1991. Defendants are entitled to credit in the
amount of four thousand four hundred ten dollars ($4410) for
the permanent partial disability compensation benefits
previously paid under the laws of the state of Indiana.
It is further ordered that all unpaid weekly
compensation be paid to William E. Smith in a lump sum
together with interest pursuant to section 85.30 computed
from the date each payment came due until the date of its
actual payment.
It is further ordered that claimant receive nothing in
the way of additional benefits under the provisions of the
fourth unnumbered paragraph of section 86.13 of the Code of
Iowa.
It is further ordered that the costs of this action are
assessed against defendants.
It is further that all benefits, interest and costs
awarded in this decision are assessed against defendants
jointly and severally.
Signed and filed this ____ day of November, 1993.
______________________________
MICHAEL G. TRIER
DEPUTY INDUSTRIAL COMMISSIONER
Page 15
Copies to:
Mr. Thomas Wertz
Attorney at Law
4089 21st Ave SW STE 114
Cedar Rapids, Iowa 52404
Mr. Chris J. Scheldrup
Attorney at Law
2720 First Ave NE
PO Box 1943
Cedar Rapids, Iowa 52406-1943
2001 2003 1802 1803 1703 2303
4000.2
Filed November 15, 1993
Michael G. Trier
BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
WILLIAM E. SMITH,
Claimant, File No. 976632
vs. A R B I T R A T I O N
CRST, INC. and LINCOLN SALES D E C I S I O N
AND SERVICE,
Self-Insured,
Employer,
Defendant.
___________________________________________________________
2001
The CRST-Lincoln Sales and Service employee leasing
agreement was held to be sham. The two corporations were
not independent entities. They had interlocking
directorships, Lincoln Sales and Service did business with
no one except CRST and had a contract under which CRST
managed an operated Lincoln Sales and Service. Claimant was
held to be an employee of both Lincoln Sales and Service and
CRST. Whenever a leased employee situation exists, it was
held that the employee is free to pursue the claim against
either or both of the two employers involved and that the
liability of the employers is joint and several.
2303
Claimant was hired in Indiana and worked out of an Indiana
terminal as an over-the-road truck driver. He later moved
to Cedar Rapids and began operating out of the Cedar Rapids
terminal. He was injured in Utah. It was held that there
were two possible bases for jurisdiction. The move to Cedar
Rapids constituted a change in the employment contract and
that as a result thereof the new employment contract was
made in the state of Iowa rather than Indiana. It was
further held that under section 85.71 that when an employer
has its principle place of business in the state of Iowa and
the employee is an Iowa domiciliary who operates out of that
principle place of business that the employment is
principally localized in the state of Iowa, even though the
employee does not spend a majority of his working time in
the state of Iowa.
Page 2
1802
Healing period ended when initial treating orthopedic
surgeon determined that further improvement was not
anticipated. Subsequent care by a different physician which
was not successful at materially increasing the claimant's
employability was held to not extend the healing period.
1803
Poorly motivated claimant who was, nevertheless, foreclosed
from over-the-road truck driving awarded 35 percent
permanent partial disability.
1703 2303
Defendants granted credit for benefits paid under the law of
the state of Indiana.
4000.2
There was a bona fide good faith dispute regarding subject
matter jurisdiction and that was held sufficient to deny any
claim for penalty.
BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
BRADLEY LOFTSGARD,
Claimant,
vs.
File Nos. 976635/976636
WALTER FARMS, INC.,
A P P E A L
Employer,
D E C I S I O N
and
GRINNELL MUTUAL,
Insurance Carrier,
Defendants.
____________________________________________________________
The record, including the transcript of the hearing before
the deputy and all exhibits admitted into the record, has
been reviewed de novo on appeal.
ISSUES
Those portions of the proposed agency decision pertaining to
issues not raised on appeal are adopted as a part of this
appeal decision. Defendants state the following issues on
appeal:
1. The Deputy Industrial Commissioner erred in finding that
Claimant incurred an occupational disease (asthma) as a
result of and arising out of and in the course of his
employment at Defendant/Employer's farm on September 9,
1990.
2. The Deputy Industrial Commissioner erred in finding that
Claimant proved by the greater weight of the evidence that
Claimant's employment at Walter Farms, Inc. caused
compensable permanent disability.
3. The Deputy Industrial commissioner erred in determining
that claimant sustained his burden of proof with regard to a
30 percent award of industrial disability benefits
4. The Deputy Industrial Commissioner erred in including
Claimant's income from hog sales in Claimant's rate since
Claimant himself had declared such income for tax purposes
as profit from his business.
Claimant states the following issues on cross-appeal:
I. The Deputy Industrial Commissioner was correct in finding
claimant's occupational disease arose out of and in the
course of his employment with the employer.
II. The Deputy Industrial Commissioner was correct in
determining that claimant's employment caused permanent
Page 2
disability.
III. Claimant is entitled to more than 30 percent industrial
disability.
IV. The Deputy Industrial Commissioner correctly included
claimant's so called "hog sales commissions" in claimant's
income.
V. The Deputy Industrial Commissioner erred in failing to
include more in claimant's average weekly wage.
findings of fact
The findings of fact contained in the proposed agency
decision filed April 20, 1992 are adopted as final agency
action.
CONCLUSIONS OF LAW
The conclusions of law contained in the proposed agency
decision filed April 20, 1992 are adopted as set forth
below. Segments designated by asterisks (*****) indicate
portions of the language from the proposed agency decision
that have been intentionally deleted and do not form a part
of this final agency decision. Segments designated by
brackets ([ ]) indicate language that is in addition to the
language of the proposed agency decision.
Claimant has the burden of proving by a preponderance
of the evidence that he received an injury or occupational
disease on July 2, 1990, or September 9, 1990, which arose
out of and in the course of his employment. McDowell v.
Town of Clarksville, 241 N.W.2d 904 (Iowa 1976); Musselman
v. Central Telephone Co., 261 Iowa 352, 154 N.W.2d 128
(1967).
The claimant has the burden of proving by a
preponderance of the evidence that the injury or
occupational disease of July 2, 1990 or September 9, 1990,
is causally related to the disability on which he now bases
his claim. Bodish v. Fischer, Inc., 257 Iowa 516, 133
N.W.2d 867 (1965). Lindahl v. L. O. Boggs, 236 Iowa 296, 18
N.W.2d 607 (1945). A possibility is insufficient; a
probability is necessary. Burt v. John Deere Waterloo
Tractor Works, 247 Iowa 691, 73 N.W.2d 732 (1955). The
question of causal connection is essentially within the
domain of expert testimony. Bradshaw v. Iowa Methodist
Hospital, 251 Iowa 375, 101 N.W.2d 167 (1960).
However, expert medical evidence must be considered
with all other evidence introduced bearing on the causal
connection. Burt, 247 Iowa 691, 73 N.W.2d 732. The opinion
of experts need not be couched in definite, positive or
unequivocal language. Sondag v. Ferris Hardware, 220 N.W.2d
903 (Iowa 1974). However, the expert opinion may be
accepted or rejected, in whole or in part, by the trier of
fact. Id. at 907. Further, the weight to be given to such
an opinion is for the finder of fact, and that may be
affected by the completeness of the premise given the expert
and other surrounding circumstances. Bodish, 257 Iowa 516,
133 N.W.2d 867. See also Musselman v. Central Telephone
Co., 261 Iowa 352, 154 N.W.2d 128 (1967).
While a claimant is not entitled to compensation for
Page 3
the results of a preexisting injury or disease, the mere
existence at the time of a subsequent injury is not a
defense. Rose v. John Deere Ottumwa Works, 247 Iowa 900,
908, 76 N.W.2d 756, 760-61 (1956). If the claimant had a
preexisting condition or disability that is aggravated,
accelerated, worsened or lighted up so that it results in
disability, claimant is entitled to recover. Nicks v.
Davenport Produce Co., 254 Iowa 130, 115 N.W.2d 812, 815
(1962).
The Iowa Supreme Court cites, apparently with approval,
the C.J.S. statement that the aggravation should be material
if it is to be compensable. Yeager v. Firestone Tire &
Rubber Co., 253 Iowa 369, 112 N.W.2d 299 (1961); 100 C.J.S.
Workmen's Compensation sec. 555(17)a.
An employer takes an employee subject to any active or
dormant health impairments, and a work connected injury
which more than slightly aggravates the condition is
considered to be a personal injury. Ziegler v. United
States Gypsum Co., 252 Iowa 613, 620, 106 N.W.2d 591 (1960),
and cases cited.
Iowa Code section 85.27 provides, in part:
For purposes of this section, the employer is
obliged to furnish reasonable services and
supplies to treat an injured employee, and has the
right to choose the care. The treatment must be
offered promptly and be reasonably suited to treat
the injury without undue inconvenience to the
employee. If the employee has reason to be
dissatisfied with the care offered, the employee
should communicate the basis of such
dissatisfaction to the employer, in writing if
requested, following which the employer and the
employee may agree to alternate care reasonably
suited to treat the injury. If the employer and
employee cannot agree on such alternate care, the
commissioner may, upon application and reasonable
proofs of the necessity therefor, allow and order
other care. In an emergency, the employee may
choose the employee's care at the employer's
expense, provided the employer or the employer's
agent cannot be reached immediately.
Iowa workers' compensation law distinguishes
occupational diseases from work injuries. An occupational
disease is a disease which arises out of and in the course
of the employee's employment. The disease must have a
direct causal connection with the employment and must follow
as a natural incident from injurious exposure occasioned by
the nature of the employment. While the disease need not be
foreseeable or expected, after its contraction, it must
appear to have had its origin in a risk connected with the
employment and to have resulted from that risk. A disease
which follows from a hazard to which an employee has or
would have been equally exposed outside of the occupation is
not a compensable occupational disease.
Page 4
The claimant need meet only two basic requirements to
prove causation of an occupational disease. First, the
disease must be causally related to the exposure to the
harmful conditions in the field of employment. Second, the
harmful conditions must be more prevalent in the employment
than in everyday life or other occupations. Section 85A.8;
McSpadden v. Big Ben Coal Co., 288 N.W.2d 181 (Iowa 1980).
Where an employee is injuriously exposed to hazardous
conditions producing occupational disease while employed by
several successive employers, the employer where the
employee was last injuriously exposed is liable for the
total disability. Doerfer Div. of CCA v. Nicol, 359 N.W.2d
428 (Iowa 1984).
To be compensable, an aggravation of an occupational
disease must be more than a temporary aggravation curable by
removal from the exposure. McNeil v. Grove Feed Mill, II
Iowa Industrial Commissioner Report 261 (App. 1981).
If claimant has an impairment to the body as a whole,
an industrial disability has been sustained. Industrial
disability was defined in Diederich v. Tri-City Railway Co.,
219 Iowa 587, 593, 258 N.W.2d 899, 902 (1935) as follows:
"It is therefore plain that the legislature intended the
term `disability' to mean `industrial disability' or loss of
earning capacity and not a mere `functional disability' to
be computed in the terms of percentages of the total
physical and mental ability of a normal man."
*****
[The medical evidence consists of a rating of permanent
impairment by Dr. McMullan of ten percent. However, Dr.
McMullan acknowledged that he did not rely on the AMA Guides
to the Evaluation of Permanent Impairment. Although the AMA
Guides are not the only source of evaluation that can be
utilized in these proceedings, they are the source that have
been recognized by our rules. In addition, the fact that
Dr. McMullan did not offer a detailed basis as to how he
arrived at the rating tends to detract from the weight the
rating is entitled to.
Dr. Zorn, on the other hand, did rely on the AMA Guides, and
concluded that claimant had no permanency. Taken as a
whole, the record indicates that, whether or not claimant
had been diagnosed with asthma as a child, claimant has an
underlying susceptibility to asthmatic reactions when
exposed to dusts and other irritants. The record also shows
that when removed from exposure to these irritants, claimant
is not symptomatic. It cannot be concluded that claimant
has a permanent condition resulting from his work exposure
under these facts. Claimant's condition is disabling only
when he is exposed to irritants, and is not disabling when
he is removed from the irritants. Claimant's disability is
therefore temporary, rather than permanent, in nature.
It appears that, whether diagnosed as asthma or not,
claimant has a preexisting condition that makes him unable
to be around certain irritants. His exposure to such
irritants while employed by defendant employer has resulted
Page 5
in an asthmatic reaction. Claimant's work exposure did not
cause his asthma; it merely aggravated it. Claimant had the
susceptibility to asthmatic reactions apparently since
childhood, and the medical evidence also seems in agreement
that his work did not give him asthma, but rather aggravated
his asthma.
Where a condition preexists the work injury or exposure,
such as preexisting asthma, and the condition is temporarily
aggravated by exposure to irritants, this agency was held
that a claimant is entitled to recovery for the aggravation
only. The fact that claimant cannot work around irritants
does not compel a conclusion of an occupational disease
caused by work. A worker with a preexisting condition such
as asthma already has the disability prior to working for
the employer, and work for the employer merely aggravates
the condition that already existed. Absent a showing that
the exposure has permanently worsened the underlying
condition, a claimant under such circumstances is entitled
only to temporary total disability for the times off work
caused by the exposure. See Gettler v. Robert Ticknor,
(Appeal Decision, April 15, 1988); Reynolds v. Amana
Refrigeration, (Appeal Decision, November 1992); Schwab v.
Pioneer Hi-Bred International, Inc., (Arbitration Decision,
May 22, 1991); and Senne v. Cedar Valley Farm Service,
(Arbitration Decision, May 9, 1991).
In this case, however, claimant did not experience a time
off work due to his asthmatic reaction, then a return to
work. Rather, claimant was medically advised to find
another job. Claimant then entered truck driving school and
was able to find a position in that field. Claimant's
preexisting asthmatic condition was temporarily aggravated
by his exposure to irritants at work, and this aggravation
prompted claimant to change jobs, tut it did not result in
time lost from work. Under these facts, claimant is not
entitled to temporary total disability benefits or permanent
disability benefits. Claimant's preexisting asthma
condition has caused him disability, but that disability is
not the responsibility of his employer. The employer is
responsible for the medical expenses caused by the work
exposure.]
WHEREFORE, the decision of the deputy is affirmed and
modified.
ORDER
THEREFORE, it is ordered:
That defendants shall pay claimant's medical expenses
as set out in joint exhibit 3.
That claimant and defendants shall share equally the costs
of the appeal including transcription of the hearing.
Defendants shall pay all other costs.
That defendants shall file a first report of injury for
the September 9, 1990 incident, as provided in Iowa Code
section 86.11.
Signed and filed this ____ day of June, 1993.
Page 6
________________________________
BYRON K. ORTON
INDUSTRIAL COMMISSIONER
Page 7
Copies To:
Mr. David Linquist
Attorney at Law
Breakwater Bldg
3708 75th St.
Des Moines, IA 50322
Mr. Philip H. Dorff, Jr.
Attorney at Law
Terrace Ctr, Ste 111
2700 Grand Ave
Des Moines, IA 50312
1801, 2203, 3000
Filed June 30, 1993
Byron K. Orton
BEFORE THE IOWA INDUSTRIAL COMMISSIONER
____________________________________________________________
BRADLEY LOFTSGARD,
Claimant,
vs.
File Nos. 976635/976636
WALTER FARMS, INC.,
A P P E A L
Employer,
D E C I S I O N
and
GRINNELL MUTUAL,
Insurance Carrier,
Defendants.
____________________________________________________________
1801, 2203
Claimant awarded temporary total disability for aggravation
of preexisting asthma.
3000
Found claimant's rate to be based on fair market value of
free house ($200 per month), free utilities ($70 per month),
free beef and pork ($500 per year) and commissions on hogs
sold by defendant employer who controlled which hogs to sell
and when, hauling, and determined amount of check hog buyer
was to write to claimant, usually four percent of sale.
Page 1
before the iowa industrial commissioner
____________________________________________________________
:
BRADLEY LOFTSGARD, :
:
Claimant, :
:
vs. : File Nos. 976635
: 976636
WALTER FARMS, INC., :
: A R B I T R A T I O N
Employer, :
: D E C I S I O N
and :
:
GRINNELL MUTUAL, :
:
Insurance Carrier, :
Defendants. :
___________________________________________________________
statement of the case
This case came on for hearing on April 6, 1992, in
Waterloo, Iowa. This is a proceeding in arbitration wherein
claimant seeks compensation for permanent partial disability
benefits as a result of either an alleged injury or an
occupational disease occurring on July 2, 1990, or September
9, 1990. The record in the proceedings consist of the
testimony of the claimant; claimant's wife, Gail Loftsgard;
Duane Walter; and Donald Blummer; and, joint exhibits 1
through 5.
issues
The issues for resolution are:
1. Whether claimant's condition and alleged permanent
disability is causally connected to the July 2, 1990, or
September 9, 1990 injury or occupational disease;
2. The extent of claimant's permanent partial
disability and entitlement to disability benefits;
3. The rate at which any benefits would be paid;
4. Claimant's entitlement to 85.27 medical benefits,
the issue being causal connection;
5. If liability is found, whether claimant recovers
under 85A, occupational disease, or Chapter 85; and,
6. Whether defendants are obligated to pay claimant's
medical bills, including those bills in 1988 and 1989, if
causal connection and liability are found.
findings of fact
The undersigned deputy, having heard the testimony and
Page 2
considered all the evidence, finds that:
Claimant is a 35-year-old high school graduate who also
graduated from truck driving school in 1990. Claimant grew
up on a farm and helped his parents in every aspect in the
livestock and grain farm operation.
Claimant played in various sports in high school and
took the normal high school courses. After graduation,
claimant worked in a cheese factory, then an implement
company, and then selling feed. He described the nature of
his work at these places of employment. He also continued
to help his parents with their farm work.
Claimant then did farming for his mother after his
father died, and another person for approximately one year
each until he began working for the defendant employer in
January of 1980 or 1981 at $750 per month plus other
benefits such as health insurance, a house to live in, free
utilities and beef and pork. Claimant described the nature
of the livestock and grain operation of defendant employer,
the nature of claimant's work for defendant employer, and
the full span of duties he did.
Claimant said he basically had no physical or health
problems while growing up and he played sports without any
problems. Claimant did relate an incident while in the
eighth or ninth grade in which he had a coughing spell and
his family doctor suggested claimant could have asthma but
there was no asthmatic diagnosis.
Claimant said he first noticed breathing problems in
the fall of 1988, the problems being coughing and tightening
of the lungs. Claimant said he was having a hard time
sleeping. Duane Walter, president of Walter Farms, had
received earlier a letter soliciting participation in a hog
and swine confinement and respiratory health project by the
University of Iowa. Claimant and Mr. Walter discussed
claimant going to Iowa City for this project and it was
agreed that claimant should go for testing.
Claimant related the tests he had and the number of
visits and who prescribed the drugs and inhalants.
Claimant indicated he was having coughing problems,
shortness of breath, became weak at times and felt like
vomiting around dust, cattle, hogs, grain, etc. Claimant
said Mr. Walter would let him get out of the buildings or
silo when he had these spells.
Claimant was referred to several medical reports (which
will be discussed later) but claimant did emphasize that
joint exhibit 2, page 99, a September 13, 1988 letter, was
the first time he actually knew he had a diagnosis of
asthma.
Claimant moved from one farmhouse he lived in on
defendant employer's farm to another farmhouse in which Mr.
Walter had previously lived before he moved off the farm
into town in 1988. This house placed claimant closer to the
Page 3
hog confinement buildings which enabled claimant to more
closely watch the hog operation and pig farrowing. Claimant
indicated that when he moved to this second house, he could
smell the hog urine more.
Claimant said he tried to move from the farm and was
going to buy a house but defendant employer wanted claimant
to stay at the farm and live on the premises so he would be
there in the evenings in case the electricity went out or
some other problem developed. The evidence showed the house
utilities were on the same system as the other building.
The evidence shows that at any one time defendant employer
had 900 hogs and 250 to 500 head of cattle.
In 1989, claimant received a raise in his monthly
salary from $750 per month to $1000 per month. The evidence
shows claimant began receiving a percent of the proceeds
from the sale of hogs of defendant employer beginning
sometime in 1989. The defendant employer was on a fiscal
year tax basis (July 1 to June 30 of each year). Claimant's
tax return (Joint Exhibit 1, page 143) shows claimant made
$16,034 gross income from this operation and $6,113 in 1990
(Jt. Ex. 1, p. 150). Claimant worked for defendant employer
only part-time from July 1, 1990 to September 9, 1990, when
he quit. Claimant said a load of hogs was sold every week
and that he would receive commissions once or twice every
two or three weeks. Claimant testified these checks came
directly from the hog buyer and not from defendant employer.
Claimant also received beef and pork to eat during his
employment with defendant employer. The meat and claimant's
housing and utilities were not reflected monetarily in
claimant's income, on any W2 or any 1099. Claimant did not
report the value of the house rental, meat or free utilities
on his income tax return. Joint exhibit 5 reflects an
appraisal value by Northeast Realty showing the rental value
of the farmhouse provided by defendant employer to the
claimant. Claimant obtained this appraisal. The appraisal
opined that the fair market rental value of the house in
which claimant was living at $250 per month. Mr. Walter,
the president of Walter Farms, Inc., defendant employer,
disagreed with this figure and through his inquiry felt that
$150 to $200 was the fair market value. Mr. Walter seems to
indicate there is not anyone in the area he could get to
give an appraisal.
Claimant never paid any utilities, which he estimated
averaged $70 or $80 per month based upon what he is paying
where he is now living. Claimant valued the one-half to one
whole steer and one to three hogs he received per year at
$500 to $700.
Claimant understood from the doctor in the spring of
1990, that he was to look for different employment or
occupation due to his condition. Claimant began looking for
another job. He filled out applications but found it hard
to find a job. Claimant then decided to go to Area 1 truck
driving school beginning July 2, 1990. He graduated on
August 20, 1990. Claimant began a new job with Olson
Explosives in September of 1990 driving a straight truck
daily round trip from Decorah to Minneapolis at $350 per
Page 4
week ($18,200 per year).
Claimant testified that if a better paying job came
along and is not too physical, he would take it; otherwise,
he intends to continue driving a truck for Olson Explosives.
Claimant currently takes medicine mainly in the form of
inhalers which he uses daily when he needs help in his
breathing.
On cross-examination, claimant was questioned
concerning his visit with Steven Zorn, M.D., and the
doctor's records indicating claimant thought he had asthmas
as a child. Claimant said he did have some wheezing
difficulty when exposed to oat and wheat dust when growing
up on the farm. Claimant testified he has seen no doctor
since December 1990, a Dr. McMullan visit, except he saw a
new local doctor last Saturday (April 4, 1992). Claimant
indicated he has no plans to farm again even though he would
like to.
Gail Loftsgard, claimant's wife, testified she and
claimant married in July 1977 and claimant had no physical
breathing problems nor was he going to the doctor at that
time. She said they moved to the Walter farm in January
1980 or 1981. She indicated the first time she became aware
of claimant having problems was in the summer of 1988 at
which time she thought claimant had a cold. He was sneezing
and coughing. Mrs. Loftsgard's testimony is cumulative as
to parts of claimant's testimony and there is no reason to
set out her testimony in any more detail.
Duane Walter, president of defendant employer, is a
shareholder of defendant employer along with his wife who is
also an officer of the company. He testified he has at any
one time 250 to 500 cattle and 900 hogs on his 330 acre
livestock and grain farm. He employs two people which was
the same number when claimant worked for him from 1980 to
September 9, 1990. He said it is a full-time job for the
employees. He acknowledged claimant began at $750 per month
plus the house, free utilities, and some free beef and pork.
He raised claimant's monthly salary to $1000 per month in
1989 and said he began giving claimant commissions on the
sale of hogs around the middle of 1988. The undersigned is
not sure whether this date is correct or if he misunderstood
as claimant's tax returns show no commissions until 1989 in
which year claimant's records (Jt. Ex. 1, p. 143) show
$16,034. Mr. Walter seemed surprised at the $16,034 figure
for 1989 and thought it was high. He commented that maybe
claimant put 1988 income into 1989. The undersigned finds
no evidence of this. In fact, defendant employer was sent
request for production of records which would indicate any
commissions, hog sale information, etc. (Jt. Ex. 1, p. 120,
121). Mr. Walter had in his possession records showing hog
sales and commissions to the claimant only for defendant
employer's fiscal year, July 1, 1989 to June 30, 1990. He
indicated he just gave those to his attorney the morning of
the hearing and didn't bring any others. He said he didn't
know until today (April 6, 1992) that the sale tickets had
claimant's commission amounts on the ticket.
Page 5
Mr. Walter said claimant began working part-time for
defendant employer in July 1990 when claimant started going
to truck driving school. At this time, claimant no longer
received commissions on the sale of hogs. Claimant worked
part-time around the first of July to September 9, 1990, at
which time he left the defendant employer.
Mr. Walter acknowledged that his reasons for giving
claimant commission is for claimant to have a more real and
personal interest in raising the hogs and not because
claimant had any outside expertise. Claimant had no contact
with the buyers and Mr. Walter made the sole decision when
and what hogs were to be sold each week and he took them to
the market himself and told the buyer what the commission
check to the claimant should be. The hog sale ticket showed
the gross sale and claimant's commission and the net to
defendant employer. Mr. Walter said a weekly hog load would
involve 45 to 48 hogs at $100 per hog. He said at one time
they were $150 per hog. Claimant was to get 4 percent
commission.
Mr. Walter, who has no other house rental income,
thought $250 was high for the rental value appraisal. He
thought $150 to $200 was more reasonable pursuant to his
inquiry. In his answer to interrogatory No. 7, he was
supposed to provide the fair market value. There has been
nothing placed in evidence in writing by the defendant (Jt.
Ex. 1, p. 348). Mr. Walter thought $70 per month as utility
value was high but offered no other figure. He never kept
track of the cattle and pigs he gave claimant to eat but
thought claimant's estimate was fair. He later estimated
the value at $300 to $400 for beef and $100 to $125 for a
hog.
Although claimant's Schedule C on his income tax return
showed claimant as broker, Mr. Walter acknowledged that
claimant had no separate business.
Mr. Walter indicated he was related to claimant's
father (third cousin) and said he treated claimant as a son,
but now feels betrayed by the claimant's workers'
compensation action. He said claimant was a good, hard and
trustworthy employee.
Donald Blummer testified he has worked for defendant
employer since June 1988 and moved into the house on
defendant employer's farm that claimant originally lived in.
Mr. Blummer worked with claimant when they were both on the
farm. Blummer said he had just started working for
defendant employer and with claimant when claimant started
going to the University of Iowa in connection with the
research testing project. Blummer said claimant was a good,
hard, honest and trustworthy worker and able to do the work.
Blummer said the farm work was an all day job and sometimes
started early in the morning and ended late at night in
order to get all the work done, depending on the time of the
year, etc. He said claimant used inhalers and if he got
worse he would take other medicine.
Page 6
Steven K. Zorn, M.D., a specialist in internal and
pulmonary medicine, testified through his deposition on
February 28, 1992 (Jt. Ex. 4). Dr. Zorn examined claimant
on July 19, 1991. He had reviewed claimant's medical
records and those records of the claimant's treating family
doctor, Thomas M. McMullan, M.D., prior to his examination.
Dr. Zorn also said he has subsequently reviewed Dr.
McMullan's report of December 4, 1991.
He related the medical history he took from claimant.
The doctor said this included a diagnosis of asthma at age
10 and then claimant went into remission as claimant grew up
and was in high school (Jt. Ex. 4, p. 9). The doctor
indicated that claimant's present condition was an
exacerbation of the asthma claimant had since childhood.
The doctor indicated claimant related a change of homes on
the Walter farm in the fall of 1988 which placed claimant
closer to the hog confinement buildings and exposed claimant
to much longer periods of exposure to hogs, urine and odor
smell. The doctor indicated the 24 hour exposure aggravated
claimant where the eight hour day did not (Jt. Ex. 4, p.
12).
The doctor related the specifics of his physical
examination of claimant. Everything appeared normal. The
doctor testified there was a test given claimant which
included a pulmonary function study to see if there was
evidence of restrictive or obstructive lung disease.
Complete pulmonary functions study done on July 19, 1991 was
normal (Jt. Ex. 4, pp. 14 and 15).
The doctor then performed a methacholine challenge.
This substance in a person without asthma does not cause any
decrease in flow rate. Claimant did have a significant dip
in flow rates when given this and asthma was confirmed (Jt.
Ex. 4, p. 16). The doctor, therefore, said all the tests
were normal except the methocholine challenge test which was
positive for an asthmatic condition (Jt. Ex. 2, pp. 39, 44).
The doctor agreed the condition on the Walter Farms
likely exacerbated claimant's asthma but he did not think
the condition caused claimant's asthma. He believed
claimant has had the asthma since childhood. He also did
not think the farm conditions caused any permanency nor is
claimant currently suffering from any residual damage or
symptoms or physical permanent impairment as a result of his
acute episode in the summer of 1990 (Jt. Ex. 4, pp. 19, 20,
21).
The doctor disagreed with Dr. McMullan's 10 percent
permanent impairment if you use the AMA Guides which
indicate no impairment. There is no evidence that Dr.
McMullan used the AMA Guides. Dr. Zorn believes that
claimant will have no restrictions as to his current work as
regards claimant's 1990 exposure (Jt. Ex. 4, p. 22). Dr.
Zorn did opine claimant's current symptoms and complaints
were due to his asthma. He said claimant, being asthmatic,
may need treatment in the future (Jt. Ex. 4, p. 23).
Dr. Zorn said asthma is a reversible airway
Page 7
obstruction. People can have it as a child and nothing
shows up for twenty years and then it can then appear again
(Jt. Ex. 4, p. 24). On cross-examination, the doctor seemed
to indicate that claimant had a genetic predisposition to
asthma and when claimant moved from one house to another
house on defendant employer's farm in which claimant was
exposed twenty-four hours a day due to the hog fumes rather
than an eight hour day, that brought claimant to a level of
having symptoms (Jt. Ex. 4, pp. 28 and 29).
Dr. Zorn acknowledged that the University of Iowa
doctors that claimant went to, James A. Merchant, M.D., and
David A. Schwartz, M.D., are experts in their area and that
they work in the area of reaction to farming such as hog
confinement (Jt. Ex. 4, p. 29).
The doctor would not advise claimant to return to the
farm doing the same thing he originally did that caused
claimant his problems. In other words, duties such as
working in the hog confinement areas, around oat dust or
silage fumes (Jt. Ex. 4, pp. 32 and 33).
The doctor did agree that before the 1990 incident,
claimant was not on breathalyzers, inhalers or on
medication.
A September 25, 1986 letter from the University of Iowa
is a letter thanking claimant for participating in a swine
confinement and respiratory health project and reflected no
significant decrease in lung function. Certain tests did
not indicate claimant experienced any abnormal reaction to
his work environment but skin tests showed claimant
vulnerable to molds, short rag weed and tree pollen (Jt. Ex.
2, p. 17).
Dr. Zorn's history taken from claimant on July 19,
1991, has a note indicating that claimant was told when he
was in tenth grade he had an "exacerbation of asthma." It
appears to the undersigned that this is where Dr. Zorn
"understood claimant had asthma" and therefore 18 to 20
years later, this "same asthma" showed up again. There is
no diagnosis of asthma prior to 1990 and it appears to the
undersigned that that was a passing comment and no medical
determination that claimant had asthma. It is not unusual
for a comment to be made when one has congestion, allergies,
etc., that one might suggest an asthmatic condition. This
situation appears similar to a situation in which a person
may come in with a stomach or lower abdomen complaint and a
comment might be made that the condition is suggestive of
appendicitis or a hernia but was just a stomach ache.
Eighteen years later one had his appendix removed or a
hernia operation. This doesn't mean claimant had
appendicitis or a ruptured hernia eighteen years earlier
just because a comment in the record suggested it might be
an appendicitis or hernia situation even though no diagnosis
or follow-up was made. The undersigned believes Dr. Zorn
took off on a layman's medical comment of claimant and this
then tainted his follow-up that claimant has the asthmatic
condition he had 18 to 20 years earlier when actually there
was no asthmatic diagnosis earlier.
Page 8
Joint exhibit 2, page 1, reflects a December 4, 1991
letter of Dr. McMullan who opined that claimant's lung
condition was definitely aggravated by his employment at
Walter Farms and claimant had a 10 percent permanent
impairment related to his employment at Walter Farms.
Claimant was advised not return to his former employment.
A letter by David A. Schwartz, M.D., of the University
of Iowa College of Medicine, on December 17, 1990, reflects
that Dr. Schwartz medically cared for claimant for
approximately one and one-half years in the occupational
medicine program at the university. He opined claimant had
occupational asthma caused by exposure to fumes generated
from the hog confinement building. He told claimant that
claimant needs to seek employment elsewhere (Jt. Ex. 2, p.
46).
There is a series of letters or reports written by the
University of Iowa beginning September 13, 1988 to December
1990, referring to claimant's diagnosis of asthma (Jt. Ex.
2, pp. 46-99).
In an October 19, 1888 letter, Dr. Schwartz and Dr.
Merchants referred to claimant's childhood history of
asthma, but again the undersigned cannot tell where the
doctors received this information other than from the
claimant's comment, which has been previously referred to.
It is of importance that Dr. Schwartz diagnosed claimant's
condition as occupational asthma and causally connected it
to his workplace as set out above (Jt. Ex. 2, p. 46).
An October 30, 1986 letter from the University of Iowa
College of Medicine, occupational health department, signed
by Dr. Merchants, does not show any asthma diagnosis (Jt.
Ex. 2, p. 109).
There has been two alleged injuries. It is obvious
from the evidence and in visiting with the attorneys that,
in fact, if liability and causation is found, there would
only be one injury or one occupational disease and not two.
It would appear because of the nature of the issues that for
protection, two petitions for two separate dates were filed.
It would also appear and is agreed to by the parties that if
a permanent injury or occupational disease is found, it
would be in reference to the September 9, 1990 date (File
No. 976636). The undersigned, therefore, will be proceeding
on the basis of an alleged September 9, 1990 injury or
occupational disease.
Prior to claimant leaving the employment of defendant
employer on or around September 9, 1990, claimant did not
lose any time and therefore there is no claim for time loss,
healing period or temporary total disability. The record is
somewhat confusing in that the parties stipulated that as to
both the July 2, 1990 and September 9, 1990 incidents, an
injury arose out of and in the course of claimant's
employment. The prehearing form is not conducive to an
occupational disease as an occupational disease is not an
injury. In looking at the entire record and the parties'
Page 9
description of disputes, it is obvious that the defendants
did not agree there was a temporary occupational disease.
It is obvious the defendants contend that any disease
(asthmatic condition) was preexisting and not work related
and that any injury was not work related but if, in fact, it
was, it only resulted in a temporary aggravation or injury
and not permanent. The undersigned will proceed on that
basis and understanding.
The first main issue is whether there is causal
connection. The undersigned finds that there is no injury.
There is no evidence of any trauma or injury as defined
under the law. Of course, if there was a traumatic injury,
there could not have been an occupational disease finding.
There is an obvious disagreement among the medical
evidence. Defendants' specialist finds that there is no
permanency and that claimant's asthmatic condition is a
preexisting condition and not caused by his work. It is
obvious that Dr. Zorn would indicate that claimant's
asthmatic condition was exacerbated by the working
conditions at defendant employer's farm. Dr. Zorn seemed to
indicate that claimant had asthma when he was ten years old
and that it was in remission. As indicated earlier, the
undersigned believes that Dr. Zorn thought there was a
diagnosis of asthma. There is nothing in the record to show
that claimant was ever determined to have had asthma prior
to 1988. This consequently set Dr. Zorn off on a separate
course. Notwithstanding this, and assuming for argument
purposes, that claimant did have asthma at age 10, the
record shows that there was no reoccurrence until
approximately 1988, almost eighteen years later. Therefore,
it would appear that even from Dr. Zorn's testimony, there
was a material and substantial aggravation of a preexisting
condition and that this condition was caused by the
conditions at the defendant employer's farm.
The undersigned believes the greater weight of medical
testimony is that testimony or records of the University of
Iowa, whose doctor(s) cared for the claimant for one-half
years and where claimant was a participant in a swine
confinement and respiratory health project, are more
acceptable and credible. Dr. Schwartz opined that claimant
had occupational asthma as a result of exposure to fumes
generated from the hog confinement buildings and that
claimant needed to seek other employment obviously to
separate himself from the environmental conditions that
existed at defendant employer's farm. Dr. McMullan also
causally connected claimant's condition to his employment
with defendant employer. Therefore, the undersigned finds
that claimant incurred an occupational disease (asthma) as a
result of and arising out of and in the course of his
employment at defendant employer's farm on September 9,
1990. As indicted earlier, in any event, claimant would
recover even if the undersigned had taken the position that
there was a preexisting disease. If the undersigned had
taken that position, he would have found that claimant's
condition was substantially and materially aggravated,
lighted up and worsened as a result of claimant's employment
with defendant employer.
Page 10
It is obvious that claimant's last injurious exposure
to the hazardous disease was while employed at defendant
employer's farm. The evidence is undisputed that claimant
should remove himself from the hog, livestock and farming
operations because of the effect that those conditions have
on his asthmatic conditions. Claimant has followed the
doctor's advice and removed himself from that type of
employment and is now driving a truck. The undersigned
finds that claimant has actually become incapacitated from
performing the work that he was doing at the time of his
occupational disease in which he had to on September 9, 1990
sever his relationship with defendant employer because of
his medical condition. Because of the occupational disease,
claimant also has been prevented from earning equal wages in
other suitable employment. The undersigned therefore finds
that claimant has reached the necessary threshold under
85A.4 disablement.
There is a dispute as to rate. Defendants contend that
the claimant's income was $1,000 per month or $12,000 per
year and based on claimant's exemptions would amount to a
rate of $204.95 per week. Claimant contends that the $1,000
per month was only part of the actual salary he received and
that should also be increased by the value of other certain
fringe benefits that claimant received, namely, commissions
on sale of hogs, the rental value of claimant's free home,
the free utilities, and the cost of the beef and pork that
claimant received each year. Claimant contends the rate
should at least be $389.62 per week based on $626.50 gross
weekly wage. The evidence in the record in which to try to
arrive at a rate is confusing and not as complete as it
should be. It is obvious from claimant's counsel that he
had a hard time trying to determine the rate. The action or
failure to act on the part of defendant has contributed in
part to this dilemma, namely, that the defendants did not
completely respond to the request for production of
documents as to this area.
Mr. Walter testified on the date of the hearing that
he just brought some statements to the court and showed his
attorney just before the hearing started even though a
request had been made some time ago. Mr. Walter also
indicated that he didn't even know the statements had the
commission to which the claimant was entitled on them until
he was noticing them on the date of the hearing.
The claimant should not be penalized by the failure of
defendants to provide information that could clarify, at
least in part, some of the deficiencies in trying to
determine the true rate to which claimant would be entitled
based on the undersigned's determination. The undersigned
finds that claimant's $1,000 a month was not his sole
compensation for working for defendant employer. Based on
the testimony and evidence, the amount of pay, if it were
$1,000 per month, would be considerably low and unfair based
on the duties, obligations, and hours worked by this
claimant for defendant employer. It is obvious to the
undersigned that other benefits were given to the claimant
to make his compensation fair. Likewise, Mr. Walter
Page 11
indicated that the commission system was set up considering
the sale of hogs, to give claimant a more personal interest
in raising the hogs all of which was for the benefit of both
parties but more beneficial to defendant employer
considering the number of hogs the company had.
Even though claimant's tax returns refer to him as a
broker and this income is set out on Schedule C, the
undersigned finds this is for the convenience of the
defendant employer. Mr. Walter indicated he strictly
controlled the situation, not only when and how many hogs
were sold but he also delivered the hogs to the market and
actually told the buyer the percent of commission that
claimant was to make and that the check would be made out to
the claimant, all under the instructions of Mr. Walter.
The undersigned finds that the value of the home, free
utilities, and the value of the beef and pork should be
considered in attempting to figure claimant's gross income.
The undersigned finds that the fair market rental of the
house is $200 per month, the utilities $70 per month, and
the beef and pork given to claimant as $500 per year. The
undersigned must determine the value of the commissions for
purposes of determining claimant's gross income. As
referred to earlier, this is not an easy task based on the
record. The undersigned believes that the value of the
commissions on the fiscal year beginning September 1, 1989
to August 31, 1990, amounted to $11,457.68. The undersigned
arrived at that figure by taking eight months in 1990 and
the four months of 1989 to make up a fiscal year of
September 1, 1989 to August 31, 1991. Joint exhibit 1, page
143, reflects that claimant had a gross income of $16,034
for the year 1989. Dividing that by 12, one arrives at a
monthly commission average of $1,336.16 per month. Taking
that times four months in 1989 amounts to $5,344.64. Taking
the figure on joint exhibit 1, page 150, claimant had income
from the commission on hogs of $6,113. This amount was
actually earned in the first six months of 1990. The
testimony indicates that claimant began driving school
around July 2, 1990 and finished in August 1990 and quit
employment with defendant employer around September 8, 1990.
Mr. Walter indicated that claimant was taken off the
commission basis when he began truck driving school and
became a part-time worker but he did continue to draw the
$1,000 per month wage. Taking the $6,113 as the commission
for the eight months that claimant was employed with
defendant employer in 1990 and add that to the $5,344.64
which is a four month commission for 1989, as figured above,
plus claimant's $12,000 salary ($1,000 per month), $840 for
the $70 per month for 12 months utilities, $2,400 for the
$200 per month free house based on its fair market rental
value found by the undersigned and $500 for the value of the
beef and pork given to claimant, this amounts to $27,197.68,
or $523.03 gross per week for the fiscal year of September
1, 1989 to August 31, 1990. The undersigned finds that the
weekly rate based on four exemptions is $331.27. Although
claimant's attorney thought the basic computation should be
Page 12
under 85.36(10), the undersigned finds the closest category
would be 85.36(4).
As to the 85.27 dispute, the issues within that were
causal connection and if found, whether defendants are
responsible for claimant's medical going back to 1988 to the
present or only from September 9, 1990. Having found causal
connection, the undersigned finds that defendants are
responsible for claimant's medical. The undersigned further
finds that this being found to be an occupational disease,
the medical bills incurred because of this disease should be
paid by defendants. Therefore, the bills beginning with the
medical services rendered in 1988 to the present are owed by
and shall be paid by defendants. No specific figure shall
be set out herein or in the order as the parties agree that
if causal connection is found and the particular years
involved are found by the undersigned, they then can work
out the amount of medical bills that would be owed and any
credit without the undersigned determining any exact figure.
The last issue is the determination of the extent of
claimant's permanent disability. There is only one
impairment rating and that is by Dr. McMullan of 10 percent.
The University of Iowa Hospital gave no impairment rating
and it appears from the records that no rating was requested
of them. It would appear from the record that considering
the manner in which the University of Iowa became involved,
which originated from a research project, it seems
reasonable that they weren't asked for an impairment rating
even though that might have helped to some extent. Dr. Zorn
indicated that the AMA Guides do not indicate any impairment
rating under the circumstances herein. There is no evidence
that Dr. McMullan used the AMA Guides. The AMA Guides are
only a guide and not the gospel as far as helping to
determine claimant's industrial disability and trying to
determine any impairment that may or may not have an
appreciable effect on the undersigned's determination of
industrial disability.
The greater weight of evidence shows that claimant has
a loss of income. Claimant is now making $18,200 per year
and obviously putting in less time and involved in less
rigorous work. As set out above, claimant was making the
equivalent of approximately $27,198 per year working for
defendant employer. The record indicates that claimant no
longer will be able to work in the industry that he has
devoted a considerable part of his life in which he had the
expertise and the transferable skills. Defendant employer
inferred he would not take the claimant back even if
claimant could come back.
Claimant searched for various jobs it and appears the
current job he has found suits his medical situation.
Taking into consideration all those items that the
undersigned must consider to determine claimant's industrial
disability, said items including but not necessarily limited
to claimant's age, work experience, medical history prior to
and after his September 9, 1990 occupational disease, his
Page 13
education, nature of his occupational disease, and
motivation, the undersigned finds that claimant has incurred
a 30 percent industrial disability. He is therefore
entitled to 150 weeks of permanent partial disability
benefits at the rate of $331.27 per week.
The undersigned finds that claimant takes nothing
concerning his allegation of an injury or occupational
disease occurring on July 2, 1990.
analysis and conclusions of law
Claimant has the burden of proving by a preponderance
of the evidence that he received an injury or occupational
disease on July 2, 1990, or September 9, 1990, which arose
out of and in the course of his employment. McDowell v. Town
of Clarksville, 241 N.W.2d 904 (Iowa 1976); Musselman v.
Central Telephone Co., 261 Iowa 352, 154 N.W.2d 128 (1967).
The claimant has the burden of proving by a
preponderance of the evidence that the injury or
occupational disease of July 2, 1990 or September 9, 1990,
is causally related to the disability on which he now bases
his claim. Bodish v. Fischer, Inc., 257 Iowa 516, 133
N.W.2d 867 (1965). Lindahl v. L. O. Boggs, 236 Iowa 296, 18
N.W.2d 607 (1945). A possibility is insufficient; a
probability is necessary. Burt v. John Deere Waterloo
Tractor Works, 247 Iowa 691, 73 N.W.2d 732 (1955). The
question of causal connection is essentially within the
domain of expert testimony. Bradshaw v. Iowa Methodist
Hospital, 251 Iowa 375, 101 N.W.2d 167 (1960).
However, expert medical evidence must be considered
with all other evidence introduced bearing on the causal
connection. Burt, 247 Iowa 691, 73 N.W.2d 732. The opinion
of experts need not be couched in definite, positive or
unequivocal language. Sondag v. Ferris Hardware, 220 N.W.2d
903 (Iowa 1974). However, the expert opinion may be
accepted or rejected, in whole or in part, by the trier of
fact. Id. at 907. Further, the weight to be given to such
an opinion is for the finder of fact, and that may be
affected by the completeness of the premise given the expert
and other surrounding circumstances. Bodish, 257 Iowa 516,
133 N.W.2d 867. See also Musselman v. Central Telephone
Co., 261 Iowa 352, 154 N.W.2d 128 (1967).
While a claimant is not entitled to compensation for
the results of a preexisting injury or disease, the mere
existence at the time of a subsequent injury is not a
defense. Rose v. John Deere Ottumwa Works, 247 Iowa 900,
908, 76 N.W.2d 756, 760-61 (1956). If the claimant had a
preexisting condition or disability that is aggravated,
accelerated, worsened or lighted up so that it results in
disability, claimant is entitled to recover. Nicks v.
Davenport Produce Co., 254 Iowa 130, 115 N.W.2d 812, 815
(1962).
The Iowa Supreme Court cites, apparently with approval,
the C.J.S. statement that the aggravation should be material
if it is to be compensable. Yeager v. Firestone Tire &
Page 14
Rubber Co., 253 Iowa 369, 112 N.W.2d 299 (1961); 100 C.J.S.
Workmen's Compensation sec. 555(17)a.
An employer takes an employee subject to any active or
dormant health impairments, and a work connected injury
which more than slightly aggravates the condition is
considered to be a personal injury. Ziegler v. United
States Gypsum Co., 252 Iowa 613, 620, 106 N.W.2d 591 (1960),
and cases cited.
Iowa Code section 85.27 provides, in part:
For purposes of this section, the employer is
obliged to furnish reasonable services and
supplies to treat an injured employee, and has the
right to choose the care. The treatment must be
offered promptly and be reasonably suited to treat
the injury without undue inconvenience to the
employee. If the employee has reason to be
dissatisfied with the care offered, the employee
should communicate the basis of such
dissatisfaction to the employer, in writing if
requested, following which the employer and the
employee may agree to alternate care reasonably
suited to treat the injury. If the employer and
employee cannot agree on such alternate care, the
commissioner may, upon application and reasonable
proofs of the necessity therefor, allow and order
other care. In an emergency, the employee may
choose the employee's care at the employer's
expense, provided the employer or the employer's
agent cannot be reached immediately.
Iowa workers' compensation law distinguishes
occupational diseases from work injuries. An occupational
disease is a disease which arises out of and in the course
of the employee's employment. The disease must have a
direct causal connection with the employment and must follow
as a natural incident from injurious exposure occasioned by
the nature of the employment. While the disease need not be
foreseeable or expected, after its contraction, it must
appear to have had its origin in a risk connected with the
employment and to have resulted from that risk. A disease
which follows from a hazard to which an employee has or
would have been equally exposed outside of the occupation is
not a compensable occupational disease.
The claimant need meet only two basic requirements to
prove causation of an occupational disease. First, the
disease must be causally related to the exposure to the
harmful conditions in the field of employment. Second, the
harmful conditions must be more prevalent in the employment
than in everyday life or other occupations. Section 85A.8;
McSpadden v. Big Ben Coal Co., 288 N.W.2d 181 (Iowa 1980).
Where an employee is injuriously exposed to hazardous
conditions producing occupational disease while employed by
several successive employers, the employer where the
employee was last injuriously exposed is liable for the
total disability. Doerfer Div. of CCA v. Nicol, 359 N.W.2d
Page 15
428 (Iowa 1984).
To be compensable, an aggravation of an occupational
disease must be more than a temporary aggravation curable by
removal from the exposure. McNeil v. Grove Feed Mill, II
Iowa Industrial Commissioner Report 261 (App. 1981).
If claimant has an impairment to the body as a whole,
an industrial disability has been sustained. Industrial
disability was defined in Diederich v. Tri-City Railway Co.,
219 Iowa 587, 593, 258 N.W.2d 899, 902 (1935) as follows:
"It is therefore plain that the legislature intended the
term `disability' to mean `industrial disability' or loss of
earning capacity and not a mere `functional disability' to
be computed in the terms of percentages of the total
physical and mental ability of a normal man."
It is further concluded that:
Claimant incurred an occupational disease that arose
out of and in the course of his employment and was caused by
exposure to harmful conditions in the field of employment
and that these harmful conditions were more prevalent in the
employment than the everyday life or other occupations.
Claimant was injuriously exposed to hazardous
conditions producing occupational disease while employed at
defendant employer, Walter Farms, Inc., and that this was
the employer in which the claimant was last injuriously
exposed.
Because of claimant's occupational disease, claimant is
incapacitated from performing the work that he was
performing for defendant employer and is incapacitated from
performing the work of helping to operate a livestock or
grain farm or a hog confinement operation.
Claimant has been unable because of his occupational
disease to earn equal wages in other suitable employment
because of his occupational disease.
Claimant did not have a medical diagnosis of asthma
prior to September 1988.
Claimant's medical bills incurred in 1988 to the
current are casually related to claimant's occupational
disease of September 9, 1990, and that said bills are the
obligation of defendant employer.
Claimant is entitled to weekly benefits at the rate of
$331.27 per week based on a weekly gross income of $523.03
and entitled to four exemptions.
Claimant's weekly benefits shall commence on September
9, 1990.
Claimant has incurred an occupational disease under the
provisions of Chapter 85A, which is caused by claimant's
employment at Walter Farms, Inc.
Page 16
Claimant has incurred a substantial loss of income as a
result of his occupational disease caused by defendant
employer.
Claimant has incurred industrial disability of 30
percent.
order
THEREFORE, it is ordered:
That claimant is entitled to one hundred fifty (150)
weeks of permanent partial disability benefits at the weekly
rate of three hundred thirty-one and 21/100 dollars
($331.21) beginning September 9, 1990.
That defendants shall pay accrued weekly benefits in a
lump sum and shall receive credit against the award for
weekly benefits previously paid. Defendants have paid no
weekly benefits prior to the date of hearing. Claimant
incurred no healing period as stipulated by the parties.
That defendants shall pay claimant's medical expenses
as set out in joint exhibit 3.
That defendants shall pay interest on benefits awarded
herein as set forth in Iowa Code section 85.30.
That defendants shall pay the costs of this action,
pursuant to rule 343 IAC 4.33.
That defendants shall file a first report of injury for
the September 9, 1990 incident, as provided in Iowa Code
section 86.11.
That defendants shall file an activity report upon
payment of this award as required by this agency, pursuant
to rule 343 IAC 3.1.
Signed and filed this ____ day of April, 1992.
______________________________
BERNARD J. O'MALLEY
DEPUTY INDUSTRIAL COMMISSIONER
Copies to:
Mr David Linquist
Attorney at Law
Breakwater Bldg
3708 75th St
Des Moines IA 50322
Mr Philip H Dorff Jr
Attorney at Law
Terrace Ctr Ste 111
2700 Grand Ave
Des Moines IA 50312
Page 17
1100; 1108; 2203; 5-2500
3000; 1803
Filed April 20, 1992
Bernard J. O'Malley
before the iowa industrial commissioner
____________________________________________________________
:
BRADLEY LOFTSGARD, :
:
Claimant, :
:
vs. : File Nos. 976635
: 976636
WALTER FARMS, INC., :
: A R B I T R A T I O N
Employer, :
: D E C I S I O N
and :
:
GRINNELL MUTUAL, :
:
Insurance Carrier, :
Defendants. :
___________________________________________________________
1100; 1108; 2203
Found claimant incurred an occupational disease (asthma) on
September 9, 1990, which arose out of and in the course of
his employment with defendant employer.
2203
Found claimant was disabled under the provisions of 85A.4.
5-2500
Found defendants to pay claimant's medical bills for his
September 9, 1990 occupational disease including bills in
1988 and 1989 when symptoms surfaced.
3000
Found claimant's rate to be based on fair market value of
free house ($200 per month), free utilities ($70 per month),
free beef and pork ($500 per year) and commissions on hogs
sold by defendant employer who controlled which hogs to sell
and when, hauling, and determined amount of check hog buyer
was to write to claimant, usually 4% of sale.
1803
Found claimant incurred a 30% industrial disability.