Deeter v. Safeway Stores, Inc.
| Decision Date | 21 December 1987 |
| Docket Number | No. 19022-9-I,19022-9-I |
| Citation | 747 P.2d 1103,50 Wn.App. 67 |
| Parties | Howard DEETER and Hermoine Deeter, husband and wife, Appellants, v. SAFEWAY STORES, INC., a foreign corporation, and Scott Wetzel Services, Inc., a foreign corporation, Respondents. |
| Court | Washington Court of Appeals |
William S. Bailey, Schroeter, Goldmark & Bender, Seattle, for Howard and Hermoine Deeter.
Ralph C. Pond, Lane, Powell, Moss & Miller, Seattle, for Safeway Stores, Inc.
Appellants Howard M. and Hermoine Deeter appeal from a judgment of dismissal for lack of subject matter jurisdiction. They brought this suit against respondents Safeway Stores, Inc. and Scott Wetzel Services, Inc. (collectively referred to as "Safeway") asserting that respondents engaged in unfair or deceptive claims practices and outrageous conduct in the administration of Mr. Deeter's claim under the Industrial Insurance Act (IIA). The Deeters allege that Safeway's actions over a period of 9 years in both the administrative and appeals processes constituted the tort of outrage separate and apart from IIA claims and created a further cause of action under both the Washington Consumer Protection Act (CPA), and the Washington Insurance Code (the Code). Having determined that the Deeters' claim was properly confined to the IIA, we affirm.
Deeter worked for Safeway Stores, Inc. as a warehouseman and truck driver from 1935 to 1977. On May 24, 1977, he injured his right knee while unloading a frozen food truck. On June 22, 1977, the Department of Labor and Industries (the Department) entered an order allowing the claim with Safeway Stores, Inc., and benefits were provided. After Deeter's claim was submitted, medical complications developed and, ultimately, his entire right knee had to be removed and replaced with a prosthesis. Safeway Stores, Inc., a self- insured employer for purposes of workers' compensation under the IIA, engaged Scott Wetzel, Inc. to administer its workers' compensation claims.
Deeter's medical history in association with this case may be summarized as follows: In May 1977, following his injury, Deeter recuperated for about a week and then returned to work until his retirement in July 1977. From May to December of 1977 Deeter was treated by Dr. Den Dulk, the family physician. Dr. Dulk performed three aspirations of Deeter's right knee and placed him on medication.
In 1978 Deeter was treated by three physicians. First, he was referred to Dr. Allen Jackson, an orthopedic surgeon. Dr. Jackson did an arthrogram, an x-ray of the knee into which dye is injected. He also performed an arthrotomy, a surgical technique involving the removal of the medial meniscus. Dr. Jackson continued to observe Deeter throughout the post operative period. Next, Deeter was examined at Safeway's request by Dr. Frederick Tokarcheck who concluded that additional surgery was not required and recommended closing the claim with a permanent partial disability award. Finally, Dr. Jackson referred Deeter to Dr. James B. Smith, an orthopedist, who recommended a total knee replacement.
In 1979 Deeter's condition worsened. He experienced persistent pain and difficulty when moving his right knee. In January 1979 Safeway referred him to Dr. J. Harold Brown who recommended total knee replacement. Dr. Jackson concurred with Dr. Brown's recommendation. Safeway then authorized Dr. Jackson to perform the total knee replacement. However, in November 1979 Dr. Jackson felt that Deeter's condition was stable and that total knee replacement should not be performed at that time. Dr. Brown then re-examined Deeter and concluded that he was totally disabled and unemployable as a truck driver. Dr. Jackson agreed.
In February 1980 Dr. Jackson indicated to People Systems, Inc., a vocational rehabilitation service retained by Safeway, that Deeter could do light work as the driver of a van, a private car, or an escort vehicle. In June 1980 Dr. Jackson again recommended a total knee replacement but, because of Deeter's need to take medication, advised against commercial driving. In June 1980 Deeter was examined at Safeway's request by an orthopedic panel that concluded he could perform some types of work and that his claim should be closed with a permanent partial disability rating. In August 1980 Dr. Jackson referred Deeter to Dr. William Gruber who stated that a total knee replacement was necessary.
In January 1981 Dr. Jackson performed a total knee replacement of Deeter's right knee and requested a closing examination. In November 1981 Dr. John McDermott performed the closing examination stating that Deeter had a 40 percent permanent partial disability and that he could not return to work. Safeway then requested People Systems, Inc. to meet with Dr. Jackson to reassess Deeter's vocational prospects. Although Dr. Jackson approved two of the suggested jobs, he added that a 67-year-old man with Deeter's disabilities could not realistically be expected to work again.
In 1982 Deeter continued to have problems with pain. Dr. Jackson noted that a further revision of the knee replacement may be necessary in the future and that Deeter was incapable of resuming any type of work requiring significant physical activity. In March 1982 Deeter requested that Safeway award him a pension based on total disability. In April 1982 a Department disability adjudicator concluded that Deeter had viable job alternatives but that he wished to stay retired and should, therefore, receive a permanent partial disability award and closure of the claim.
Between 1979 and 1982 Safeway Stores, Inc. and Scott Wetzel Services, Inc. (Wetzel) exchanged numerous memoranda concerning Deeter's claim. A summary of these communications follows: First, regarding time loss benefits, in March 1979 Wetzel recognized the need to pay these benefits, but in April 1980 quit paying them based on Dr. Jackson's opinion that Deeter could return to work. Second, regarding Deeter's vocational prospects, Wetzel advised Safeway Stores, Inc. in February 1980 to create a "light duty job" for Deeter to avoid paying him a life pension. The same recommendation was made in May 1980 and in September 1981. Finally, regarding the pension, in February 1980 a Wetzel claims supervisor stated that unless a suitable area of employment was found for Deeter, he would probably be placed on a pension as a permanently and totally disabled worker. Wetzel's senior vice president responded that under no circumstances would Wetzel award Deeter a pension and that, instead, a job should be found for him. In November 1980 Wetzel had predicted that Deeter would receive a permanent partial disability award of 50 percent at closure. Thereafter, in April 1982, Wetzel sought closure of the claim with no pension, but left "reserves high" because of the possibility of a pension award. In September 1982 Wetzel engaged a security service to conduct a photographic surveillance activities check of Deeter.
On May 4, 1982, the Department closed Deeter's claim with a permanent partial disability award of 40 percent of the amputation value of the right leg at or above the knee joint. Deeter appealed. On May 10, 1982, after the Department entered an order correcting and superseding the May 4, 1982 order, Deeter again appealed. He then filed an application to reopen his claim based upon muscle spasms in his right calf. On February 25, 1983, the Board of Industrial Insurance Appeals remanded the case to the Department with the direction that Safeway be required to provide compensation to Deeter as a totally and permanently disabled worker. The Department complied with this order, placing Deeter on a pension retroactive to May 1, 1982. Safeway appealed to the Department, but review was denied. Safeway then filed a notice of appeal to superior court.
On March 5, 1984, while Safeway's appeal was pending, Deeter filed a second application to reopen his claim based upon chronic pain in his left foot and a painful right knee. After the filing of this application, Safeway's appeal to the superior court was resolved by an agreed order, which required that Deeter's claim remain open for medical treatment and any additional benefits and that Safeway pay Deeter's attorney's fees in connection with the appeal. The Department provided that the amount already paid to Deeter on his pension be considered an advance of any further payment of time loss benefits.
On February 6, 1985, the Deeters filed a summons and complaint alleging that Safeway failed in good faith to effect the fair and equitable settlement of Deeter's claim; refused to pay the claim without conducting a reasonable investigation; forced the Deeters to institute litigation to recover amounts due; and failed to promptly provide a reasonable explanation for the denial of the claim or for an offer of compromise settlement.
Safeway moved for summary judgment, arguing that Deeter's claim was barred by the exclusive remedy provisions of the IIA, RCW Title 51. The motion was denied, and the case was submitted to arbitration. The Deeters received an arbitration award of $25,000. On February 4, 1986, Safeway was granted a trial de novo on all issues. Before trial Safeway moved to dismiss for lack of subject matter jurisdiction, and the motion was granted. The trial court ruled that the Deeters had failed to establish a prima facie case of an intentional tort by Safeway. The court also dismissed their claims under the CPA and the Code. The Deeters' motion for reconsideration was denied. This appeal timely followed.
The primary issue in this case is whether the bar to suits for industrial injuries covered under the IIA, Title 51, should extend to the claims administration process. As a general rule the exclusivity provisions of the IIA bar an action against the employer for an injury incurred...
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