Emerson Elec. Co. v. McLarty

• Decision Date: 23 April 1986
• Docket Number: No. 55460,55460
• Citation: 487 So.2d 228
• Parties: EMERSON ELECTRIC COMPANY v. Bessie Mae McLARTY.
• Court: Mississippi Supreme Court

Page 228

487 So.2d 228

EMERSON ELECTRIC COMPANY v. Bessie Mae McLARTY.

No. 55460.

Supreme Court of Mississippi.

April 23, 1986.

S.T. Rayburn, Richard C. Coker, Sumners, Hickman & Rayburn, Oxford, for appellant.

D. Briggs Smith, Smith & Phillips, Batesville, for appellee.

Before PATTERSON, C.J., and DAN M. LEE and ROBERTSON, JJ.

DAN M. LEE, Justice, for the Court:

Bessie Mae McLarty was awarded apportioned Workers' Compensation benefits by an administrative judge on January 26, 1982. On petition for review before the full Workers' Compensation Commission, the order of the administrative judge was affirmed. Appeal was made to the Circuit Court of Lafayette County where the circuit court judge affirmed the decision of the full commission.

Appeal is now perfected to this Court and the following assigned as error:

(1) The lower court erred in failing to recognize and apply the defense of estoppel by fraud or misrepresentation in the procurement of employment, thereby barring (sic) Workmen's Compensation benefits; and,

(2) The lower court erred in upholding the award of the Mississippi Workmen's Compensation Commission for additional temporary total, medical and permanent partial disability benefits from and after March 1, 1978.

I.

In 1969, Bessie Mae McLarty accidentally injured her back while employed by the Sam Shainberg Co. in Memphis, Tennessee. As a result, in 1970, McLarty underwent surgery in Tupelo, Mississippi, during which it was necessary that a disc be removed from her back. On her Workmen's Compensation Claim arising from that accident, McLarty was determined to have sustained a 15 to 20% disability to her body as a whole. McLarty returned to Shainberg's where she worked until 1972, at which time she and her family moved to the vicinity of Batesville and Oxford, Mississippi.

On October 24, 1972, McLarty sought employment with the appellee, Emerson Electric Company. In response to questions on her employment application form, McLarty indicated that her only serious illness or injury in the ten years preceding had been a complete hysterectomy performed May 18, 1971. Despite the fact that it had occurred only two years earlier, McLarty failed to mention her back injury of 1969 and the resultant 1970 disc surgery.

Emerson hired McLarty and her employment progressed without relevant incident for approximately five years until December 8, 1977. On that date, McLarty sustained an injury to her back while working on an Emerson assembly line. Approximately two weeks later, surgery was performed and another disc removed from McLarty's back. Emerson Electric accepted responsibility for McLarty's injury and paid all medical benefits and temporary total benefits accruing to her from January 8, 1977, through March 1, 1978.

McLarty received a medical release and returned to work at Emerson on March 1, 1978. She continued to work through April 5, 1978.

On April 6, 1978, McLarty was involved in an automobile accident, during which she sustained injuries to her shoulder and neck. She was unable to return to work until July 5, 1978.

Although her back continued to cause her pain, McLarty returned to work for Emerson on July 5, 1978. She continued to work until July 20, 1978, when the pain increased to the point that she was forced to leave the job.

McLarty filed a motion to controvert on July 21, 1978, seeking temporary and permanent compensation payments. Emerson answered, admitting the injury but contesting permanent benefits. Subsequently, Emerson amended its answer to include the defense of fraud in the procurement of employment.

The order of the administrative judge was entered on January 26, 1982. Relying on Sec. 71-3-7 Miss.Code Ann. (1972), the administrative judge denied Emerson's defense of fraud, stating that it was not one of the two statutory defenses to workers' compensation claims. The administrative judge also held that Emerson Electric had not sustained its burden of showing fraud by clear and convincing evidence. In his order, the administrative judge awarded Bessie Mae McLarty apportioned benefits amounting to 450 weeks of compensation at the rate of $25.00 per week (the minimum) for permanent partial disability benefits.

The decision of the administrative judge was appealed to the full Workers' Compensation Commission. After hearing testimony and argument, the Commission affirmed the order of the administrative judge on August 17, 1982. On the issue of fraudulent procurement of employment, the majority made two findings: (1) that no such defense existed in Mississippi jurisprudence; and, (2) even if such a defense did exist, Emerson Electric had not sustained its burden of proof.

II.

Did the lower court err in failing to recognize and apply the defense of estoppel by fraud or misrepresentation in the procurement of employment and, due to that failure, allow Workers' Compensation benefits?

Application of the estoppel doctrine in a Workers' Compensation case is explained at IC Larson, Workmen's Compensation Law (M.B.) Sec. 47.53 (Feb.1980). The following factors must be present before a false statement in an employment application will bar benefits:

(1) The employee must have knowingly and willingly made a false representation as to his physical condition.

(2) The employer must have relied upon the false representation, and this reliance must have been a substantial factor in the hiring.

(3) There must have been a causal connection between the false representation and the injury.

Reference is made to two previous cases wherein this Court was called upon to decide whether an employee with a preexisting disability, who procured employment without informing the potential employer of that infirmity, would later be estopped to make claim under Mississippi's Workers' Compensation Plan. See, I.B.S. Mfg. Co. v. Dependents of Cook, 241 Miss. 256, 130 So.2d 557 (1961); L.B. Priester and Son v. McGee, 234 Miss. 471, 106 So.2d 394 (1958). In neither of those cases was it necessary that this Court deny benefits as awarded.

In Cook, a woman suffered a heart attack and died due to conditions of her employment which aggrevated pre-existing heart disease. In her application for employment, she had stated that she had never experienced heart trouble. This Court first noted that a party charging fraud must prove it by clear and convincing evidence; it then found that there was a lack of proof that the woman knew she had heart trouble at the time she filed her application. The judgment of the lower court was affirmed.

In McGee, it was also found that the evidence was insufficient to establish that the employee concealed or misrepresented the state of his physical condition. As in Cook, the employee failed to tell the employer at the time of his employment that he had suffered a heart attack four years earlier; however, the employer had not inquired about the employee's previous or present state of health nor had a physical examination been required. Workers' Compensation benefits were allowed and upheld after the employee suffered a heart attack on the job.

In the case sub judice there also appears to be a lack of evidence sufficient to bar recovery by McLarty. Here the employer/carrier has failed to prove that there was any causal connection between McLarty's alleged false representation and the injury which she suffered on December 8, 1977.

In the order of the majority members of the commission, the following was noted:

[B]efore a false representation will bar a worker from recovery of benefits in those jurisdictions recognizing the defense, defendant must establish that the injury on which the claim is based is causally related to the employee's...