C.T.S. Corporation v. Schoulton, No. 2-774A178

Docket NºNo. 2-774A178
Citation354 N.E.2d 324
Case DateSeptember 13, 1976
CourtCourt of Appeals of Indiana

Page 324

354 N.E.2d 324
C.T.S. CORPORATION, Defendant-Appellant,
Philip SCHOULTON, Administrator of the Estate of Manley J.
Robinson, Sr., Deceased, Plaintiff-Appellee.
No. 2-774A178.
Court of Appeals of Indiana, Second District.
Sept. 13, 1976.
Rehearing Denied Oct. 7, 1976.
Opinion Superseded, see 383 N.E.2d 293.

Page 325

Arthur A. May, Crumpacker, May, Levy & Searer, South Bend, for defendant-appellant.

Frank J. Petsche, David L. Matthews & Associates, South Bend for plaintiff-appellee.


C.T.S. Corporation (Employer) appeals from an award by 4-2 vote of the Full Industrial Board granting workman's compensation hospitalization, medical, funeral and death benefits to the estate of Manley J. Robinson (Employee).

Employee died of acute liver and kidney failure which the Board found to be occasioned by inhalation of toxic fumes. The question before us is whether there was sufficient evidence of record to establish that the inhalation of toxic fumes was sustained in the course and scope of employment. More particularly Employer takes issue with the Board's consideration of hearsay evidence which established the causal connection.

There is undisputed evidence that trichloroethylene, a degreasing cleaning agent, was used by employees for many purposes in Employer's plant. Despite some discrepancy in terminology, 1 the cleaning agent used in the plant had toxic properties.

The Employee's treating physician saw Employee at a truck stop in Jones, Michigan on October 16 or 17, 1970 after Employee had complained of nausea, vomiting and general weakness. The condition worsened and Employee was hospitalized on October 19 with nausea, vomiting and distended stomach, enlarged liver and low urine output. On October 24, he died as a result of kidney and liver failure.

Employee had a medical history of alcoholism and a liver condition i.e., infectious hepatitis. An autopsy, however, disclosed that the liver was not cirrhotic and it was concluded by the pathologist that neither cirrhosis nor alcoholism caused the liver and kidney failure. It was the medical opinion of Employee's treating physician and a consulting physician that

Page 326

Employee died from the toxic effect of massive inhalation of cleaning solvent occasioned when a full drum or bucket of the solvent spilled on the floor at Employer's plant.

The only evidence that there was, in fact, such an occurrence came via hearsay evidence. Employee's treating physician testified that he was asked by Employee's sister-in-law, during Employee's hospitalization, whether his condition could have been caused by exposure to 'carbon tetrachloride'. 1 The inquiry promoted the physician to question Employee directly, who, in response, stated that 'he had tripped over a barrel or bucket of cleaning solvent and that it spilled all over the floor and that he got down and cleaned it up'.

Employee's representative takes the inferential position that such hearsay was properly considered by the Full Board and that in light of the surrounding circumstances, i.e., the availability and frequent use of the cleaning agent by employees, including the decedent here, such evidence is sufficient to support the award.

Employer concedes that a 'medical history', even though hearsay, might form the basis of a medical opinion but correctly asserts that prior case law has held that such 'history' may not be used as proof of the fact or facts contained in the history given by the patient, nor may such be considered as basis for an award. City of Anderson v. Borton (1962), 132 Ind.App. 684, 178 N.E.2d 904. It is not disputed by Employee's representative that the conclusions of the medical experts regarding the industrial spilling occurrence as the cause of toxic inhalation and the consequent kidney and liver failure, were based principally, if not entirely, upon the statement made by decedent to his treating physician.

We do not perceive the determinative issue clearly to be that posed by C.T.S., i.e., whether hearsay statements may be considered by the Board as evidence to establish that Robinson's death was due to an industrial accident. Rather, we view the issue to be whether such causal relationship may be established solely by such hearsay.

In an early case, McCoy v. General Glass Corp. (1938), 106 Ind.App. 116, 17 N.E.2d 473, it was held reversible error to admit a coroner's verdict as to cause of death in a Workman's Compensation claim. It further held reversible error in the admission of testimony as to cause of death when that opinion was premised upon hearsay information which the physician obtained in his investigation as coroner. This principle, as to establishment of cause of death, was reaffirmed in Indiana Steel Products Co. v. Leonard (1956), 126 Ind.App. 669, 131 N.E.2d 162. See also generally, Indiana Bell Telephone Co. v. Haufe (1924), 81 Ind.App. 660, 144 N.E. 844.

In the recent past, we have upheld the exclusion of such hearsay evidence notwithstanding acknowledgment that the strict rules of evidence do not apply to workman's compensation proceedings. 2 Robinson v. Twigg Industries, Inc. (2nd Dist. 1972), 154 Ind.App. 339, 289 N.E.2d 733. Compare with Lewis v. Review Board (2nd Dist. 1972), 152 Ind.App. 187, 282 N.E.2d 876 and Red Cab Inc. v. Ziegner (1940), 108 Ind.App. 607, 29 N.E.2d 330.

A somewhat more relaxed rule is evidenced by a line of cases represented by City of Anderson v. Borton, supra, and White Swan Laundry v. Muzolf (1942),

Page 327

111 Ind.App. 691, 42 N.E.2d 391, which held that admission of hearsay of the nature rejected in McCoy, supra, while not cause for reversal, could nevertheless not form the basis of an Industrial Board award unless corroborated. But see Asbestos Insulating & Roofing Co. v. Schrock (1943), 114 Ind.App. 177, 51 N.E.2d 395 (overruled by American Security Co. v. Minard (1948), 118 Ind.App. 310, 77 N.E.2d 762). And more recently, in Bohn Aluminum & Brass Co. v. Kinney (2nd Dist. 1974), Ind.App., 314 N.E.2d 780, we affirmed the Board's exclusion of hearsay although we indicated that had the Board admitted such evidence, we might not have been compelled to reverse the award. See 314 N.E.2d at 786.

In a civil case, American United Life Insurance Co. v. Peffley (2nd Dist. 1973), Ind.App., 301 N.E.2d 651, a majority of this District recognized that hearsay not falling within a traditionally recognized exception might nevertheless be considered as having probative value if there were shown 'a circumstantial probability of trustworthiness, and a necessity, for the evidence'. V Wigmore, Evidence § 1420 (Chadbourn rev. 1974) at p. 251. 3

The evidence in controversy here bears both such attributes. Its necessity is obvious, for the declarant is deceased. V Wigmore, supra, § 1421. Its trustworthy characteristic is demonstrated by the fact that the decedent's statement was not volunteered but was given only in response to direct inquiry by his treating physician. The original source of the physician's information from decedent's sister-in-law does not reflect adversely upon the trustworthiness since she would have no ulterior motive or interest in the industrial workmen's compensation aspect of such information as conveyed to the physician.

The testimony here is thus different as to demonstration of trustworthiness than the testimony rejected in Robinson v. Twigg Industries, Inc., supra and Bohn Aluminum Brass Co. v. Kinney, supra (Workmen's Compensation cases) and is patently different as to necessity from that evidence rejected in Gold Bond Building Products Division v. Review Board (2nd Dist. 1976) Ind.App., 349 N.E.2d 258 (an unemployment security benefit case). We do not, however, end our consideration of this appeal upon the premise that it was not improper for the Board to consider such hearsay evidence. We must turn to the question we deem determinative, i.e., whether an award may be premised entirely upon hearsay. We answer the latter question in the affirmative.

A majority of the jurisdictions which have confronted the question appear to adopt what is termed the 'residuum rule' or a counterpart thereof. Anno. 36 A.L.R.3d 12.

The landmark case which originated the 'residuum rule' is Carroll v. Knickerbocker Ice Co. (1916), 218 N.Y. 435, 440, 113 N.E. 507, 509, in which the court concluded that the New York statute:

'. . . may be taken to mean that while the Commission's inquiry is not limited by the common law or statutory rules of evidence or by technical or formal rules of procedure, and it may, in its discretion, accept any evidence that is

Page 328

offered, still in the end there must be a residuum of legal evidence to support the claim before an award can be made.'

A salient observation was made, however, by the annotator in 36 A.L.R.3d 12 at 93--94:

'In Altschuller v. Bressler (1943) 289 NY 463, 46 NE2d 886, the Court of Appeals observed that the rule formulated in Carroll v. Knickerbocker Ice Co., text above, has been criticized by many scholars as the product of judicial reluctance to depart from long-accepted but technical common-law rules and concepts, and that the dissenting opinion (of Seabury, J.) has received correspondingly warm approval, but that nonetheless, the Court of Appeals has never overruled the Carroll Case, nor has the legislature amended the statute in a manner which would permit the trier of the facts to give greater probative force to 'hearsay' evidence.'

In any event, New York courts, since amendment of their Workmen's Compensation statute in 1922, have held that:

'. . . declarations of an employee, since deceased, concerning the accident support an award favorable to the claimant where the hearsay evidence as to the declarations of the deceased employee is corroborated by facts, circumstances, or other evidence.' Anno.: 36 A.L.R.3d 12 at 94, and cases there cited.

Thus, the 'residuum rule' appears to have been eroded even in the state of its birth. And even...

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