General Foundry Service v. Workers' Comp. Appeals Bd.

• Decision Date: 04 August 1986
• Docket Number: S.F. 24910
• Citation: 228 Cal.Rptr. 243,721 P.2d 124,42 Cal. 3d 331
• Parties: , 721 P.2d 124 GENERAL FOUNDRY SERVICE et al., Petitioners, v. WORKERS' COMPENSATION APPEALS BOARD, William Edwin Jackson et al., Respondents.
• Court: California Supreme Court

Page 243

228 Cal.Rptr. 243

42 Cal.3d 331, 721 P.2d 124

GENERAL FOUNDRY SERVICE et al., Petitioners, v.WORKERS' COMPENSATION APPEALS BOARD, William Edwin Jackson et al., Respondents.

S.F. 24910.

Supreme Court of California.

Aug. 4, 1986.

Sedgwick, Detert, Moran & Arnold, Thomas G. Rajspic, C. Gordon Taylor, Laughlin, Falbo, Levy & Moresi and Michael W. Laughlin, San Francisco, for petitioners.

Samuel E. Meredith and Goshkin, Pollatsek, Meredith & Lee as amici curiae for petitioners.

Steve Kazan, Victoria L. Edises, Oakland, and Bryce C. Anderson, Concord, for respondents.

James E. Miller and McCarthy, Johnson & Miller as amici curiae for respondents.

REYNOSO, Justice.

Exposure to asbestos in the workplace may cause cancer in a worker after a latency period of 20 to 40 years.The Labor Code contains a five-year statutory limitation on the Workers' Compensation Appeals Board's (Board) jurisdiction once a date of injury is established for a permanent disability.Thus, if a permanent disability rating takes place too early, an employee with a progressive lung disease such as asbestosis faces the risk of being precluded by the statute of limitations from seeking full compensation for his industrial injury.

A worker's compensation judge initially rated petitionerWilliam Edwin Jacksonat 21 1/2 percent permanent disability.However, the Board would not rate Jackson's lung disease as a permanent disability since medical reports unanimously agreed that his condition would continue to worsen.Instead, the Board awarded him temporary total disability payments to continue indefinitely.The Court of Appeal annulled the decision.Even though Jackson's health would continue to worsen, the Court of Appeal reasoned that his progressive disease should be considered permanent for rating purposes when the prognosis of his disease is sufficiently ascertainable to make a rating determination.

We reverse.The Board, we conclude, may tentatively rate the permanent disability of an employee with a progressive disease, and order advances based on that tentative rating.It may then reserve its jurisdiction for a final determination of permanent disability when the employee's condition is permanent and stationary, or when the employee's permanent disability is total (100 percent) and further deterioration would be irrelevant for rating purposes.

I.

Jackson worked as a molder for General Foundry Service (General) for 29 years from 1952 to 1981.During that period, exposure to asbestos and silica dust caused him to develop a progressive lung disease.Jackson stopped working in 1981 upon his doctor's advice that he avoid further exposure to dust.General has not provided Jackson with work within his capabilities and he remains unemployed.

In his initial award, the workers' compensation judge found that Jackson's lung disease was caused at least in part by exposure at work and that the disease was progressive and not yet stationary.The judge ruled that Jackson had no temporary disability.While it was too early to rate a permanent disability, the judge concluded that Jackson was entitled to an advance of 21 1/2 percent permanent disability.On petition for reconsideration, however, the judge decided that Jackson's disease was not stationary for a permanent disability rating.He concluded that Jackson should receive temporary total disability from the date he left his job.

The Board agreed with the judge's ruling on the petition for reconsideration, concluding that Jackson was temporarily disabled as of April 18, 1981, his last work day.It stated: "... owing to progression of his medical condition and the environment in which he worked, he is no longer able to perform his old job and his employer has not made work within his capabilities available to him.Thus, he has suffered wage loss, yet his condition is not stationary so that it can be rated.Under these circumstances, ... he is entitled to temporary disability indemnity until such time as his condition becomes stationary."Accordingly, the Board ordered temporary total disability payments to continue indefinitely.

The Court of Appeal annulled the Board's decision.The court determined that a progressive disease need not be stationary for a permanent disability rating.Instead, the Board should consider a progressive disease permanent when either: (1)"the disability is total and further deterioration would be irrelevant for rating purposes," or (2)"the prognosis of the disease is sufficiently ascertainable to make a rating determination."Thus, the court remanded the case to the Board to determine if Jackson came within either of these categories.

II.

A.Reservation of Jurisdiction on the Issue of Permanent Disability for an Employee With a Progressive Disease

The Labor Code does not define the term "permanent disability."However, the applicable administrative rule states: "A disability is considered permanent after the employee has reached maximum improvement or his condition has been stationary for a reasonable period of time."(Cal.Admin.Code, tit. 8, § 9735.)This definition is inadequate, however, when applied to a progressive occupational disease."The reference to 'maximum improvement' obviously refers to the more classical concept of 'injury' which envisions a traumatic incident resulting in corporal injury with a period of healing to a point of greatest improvement.The term did not envision an insidious, progressive disease process that results from a remote, undramatic work exposure and is of little or no use in determining the status of such a condition....The Board rule for permanent disability, therefore, is not very helpful ... except to suggest that the condition is not permanent and stationary because of its progressive nature."(Piedemonte v. Western Asbestos(1981)46 Cal.Comp.Cases 475, 478.)Given this inadequate definition, the Board in this case relied on the following standard: " 'a disability is generally regarded as "permanent" where further change--for better or worse--is not reasonably to be anticipated under usual medical standards.' "(Sweeney v. Industrial Acc. Com.(1951)107 Cal.App.2d 155, 159, 236 P.2d 651, quoting1 Campbell, Workmen's Compensation(1935)§ 813, p. 719.)Since Jackson's condition was likely to deteriorate, the Board concluded that his disability was not permanent.

The Court of Appeal also recognized that the Board's administrative definition of permanent disability did not adequately address the issue of rating a progressive disease.However, the court then determined that a progressive disease need not be stationary for a permanent disability rating.Instead, the Board should rate a progressive disease (such as Jackson's) as a permanent disability when the prognosis is "sufficiently ascertainable to make a rating determination."The Board could rate a progressive disease by " 'peering into the future and determining so far as possible the reasonable probabilities....[as]courts and juries do every day in personal injury actions.' "(QuotingDahlbeck v. Industrial Acc. Com.(1955)135 Cal.App.2d 394, 400-401, 287 P.2d 353.)

This approach suffers from two fundamental flaws.First, if the Board makes a permanent disability rating too early, the employee faces the risk that the five-year statute of limitations will preclude him from seeking full compensation once his disease is stationary or he has reached 100 percent disability.(Lab.Code, §§ 5410,5804.)¹This risk is especially grave considering the long latency period of diseases arising from exposure to asbestos in the workplace.²

Second, the court's suggestion for the rating of the future path of a progressive disease is not practical under the present ratings procedure for permanent disability in the California workers' compensation system.The present system rates permanent disability based on an evaluation of the employee's condition as it exists at the time of the rating according to schedules established by the Division of Industrial Accidents.( § 4660, subds. (a) and (b);see generally, Swezey, California Workers' Compensation Practice(Cont.Ed.Bar 1985) § 16.)Both parties agree that it would be unworkable to factor into this rating the unknown future progress of an occupational disease, including such speculative factors as whether lung cancer or mesothelioma might develop.³

Both parties suggest that a practical solution to the problem posed by insidious, progressive diseases would be to allow the Board to reserve jurisdiction to make its final determination on an applicant's permanent disability once the disease is permanent and stationary.(See, e.g., Los Angeles Unified School District v. Workers' Comp. Appeals Bd.(Rainey)(1985)50 Cal.Comp.Cases 285;Los Angeles Unified School District v. Workers' Comp. Appeals Bd.(Anicich)(1983)48 Cal.Comp.Cases 880;Piedemonte v. Western Asbestos, supra, 46 Cal.Comp.Cases 475.)This approach appears to have merit.

The Legislature has mandated that courts liberally construe the Workers' compensation act"with the purpose of extending [its] benefits for the protection of persons injured in the course of their employment."( § 3202.)Accordingly, we have held that the statute of limitations in workers' compensation cases"must be liberally construed in favor of the employee unless otherwise compelled by the language of the statute, and such enactments should not be interpreted in a manner which will result in a right being lost before it accrues."(Fruehauf Corp. v. Workmen's Comp.App. Bd.(1968)68 Cal.2d 569, 577, 68 Cal.Rptr. 164, 440 P.2d 236;accord, Subsequent Injuries Fund v. Workmen's Comp.App. Bd.(1970)2 Cal.3d 56, 65, 84 Cal.Rptr. 140, 465 P.2d 28.)With this principle of liberal construction in mind, we approach the issue of the Board's reservation of jurisdiction.

The Board clearly has the power to continue its jurisdiction beyond the five-year period when an...