Gerlach v. State

• Decision Date: 26 March 2008
• Docket Number: No. 24608.,24608.
• Citation: 2008 SD 25,747 N.W.2d 662
• Parties: James GERLACH, Appellant, v. STATE of South Dakota, Appellee.
• Court: South Dakota Supreme Court

747 N.W.2d 662

2008 SD 25

James GERLACH, Appellant, v. STATE of South Dakota, Appellee.

No. 24608.

Supreme Court of South Dakota.

Considered on Briefs January 7, 2008.

Decided March 26, 2008.

Lee C. "Kit" McCahren of Olinger, Lovald, McCahren, Reimers, P.C., Pierre, South Dakota, Attorneys for appellant.

Christina L. Fischer of May, Adam, Gerdes & Thompson, L.L.P., Pierre, South Dakota, Attorneys for appellee.

MEIERHENRY, Justice.

[¶ 1.] James Gerlach, a Buildings and Grounds employee for the State of South Dakota, appeals an adverse ruling on a workers' compensation claim. We affirm.

FACTS

[¶ 2.] In 1998, Gerlach began his work for the State of South Dakota as a grounds employee. In September of 2003, Gerlach was moving chairs with a co-worker and injured his lower back. It is undisputed this 2003 injury was work-related. What is disputed is whether his complained of 2004 health problems were causally related to the 2003 injury. Gerlach claims that the 2003 injury was aggravated in the spring of 2004 by driving a tractor as part of his job. He claims that the tractor's rocking and jerking motion caused chronic pain in his lower back and legs, gait abnormalities and loss of coordination and balance.

[¶ 3.] Gerlach sought treatment from several doctors: Dr. Monroe, a chiropractor; Dr. Gerhart, a pain management specialist; Dr. Plumage, an internal medicine specialist; Dr. Koob, a neurologist; and other physicians including some from Mayo Clinic. Gerlach was also examined by Dr. Luther, the State's expert. Doctors Monroe, Koob, Plumage and Gerhart, determined that Gerlach's injuries were work-related. Dr. Luther determined that Gerlach's injuries were not related to his 2003 work injury. The other doctors gave no opinion as to whether Gerlach's condition was related to his work. None of the doctors were able to provide a diagnosis for his subjective complaints.

[¶ 4.] The physicians who determined that Gerlach's condition was work-related did not testify at the hearing or by deposition. Nevertheless, the parties stipulated to the admission of Gerlach's complete medical records for the Administrative Law Judge's (ALJ's) consideration. The State's expert, Dr. Luther, testified at the hearing.

[¶ 5.] Ultimately, the ALJ found Dr. Luther to be credible and adopted his opinion concluding that Gerlach was not entitled to workers' compensation. The circuit court affirmed the ALJ's decision. Gerlach claims on this appeal that the Department of Labor erred in denying his claim.

[¶ 6.] Our standard of review in workers' compensation cases is well established.

"When the issue is a question of fact, then the actions of the agency are judged by the clearly erroneous standard; and when the issue is a question of law, then the actions of the agency are fully reviewable [i.e., de novo]." "Mixed questions of fact and law are fully reviewable."

When findings of fact are made based on live testimony, the clearly erroneous standard applies. Deference and great weight are given to the hearing examiner on fact questions. "When factual determinations are made on the basis of documentary evidence, however, we review the matter de novo, unhampered by the clearly erroneous rule."

Orth v. Stoebner & Permann Constr., Inc., 2006 SD 99, ¶¶ 27-28, 724 N.W.2d 586, 592 (citations omitted). "We do not substitute our judgment for the Department's on the weight of the evidence or the credibility of witnesses." Mettler v. Sibco, Inc., 2001 SD 64, ¶ 7, 628 N.W.2d 722, 724 (citation omitted). "The standard of review in an appeal to the Supreme Court from a trial court's appellate review of an administrative decision is de novo: unaided by any presumption that the trial court is correct." Capital Motors, LLC v. Schied, 2003 SD 33, ¶ 10, 660 N.W.2d 242, 245 (citations omitted).

[¶ 7.] When applying for workers' compensation benefits Gerlach bears the burden of proving a causal connection between his condition and his work-related injury. Wise v. Brooks Constr. Serv., 2006 SD 80, ¶ 21, 721 N.W.2d 461, 468. SDCL 62-1-1(7) provides that a compensable injury must be "established by medical evidence," and that "[n]o injury is compensable unless the employment or employment related activities are a major contributing cause of the condition complained of. . . ." Whether Gerlach's employment was a major contributing cause of his condition is necessarily a question of fact.

In applying the statute, we have held "a worker's compensation award cannot be based on possibilities or probabilities, but must be based on sufficient evidence that the claimant incurred a disability arising out of and in the course of his employment." We have further said "South Dakota law requires [Gerlach] to establish by medical evidence that the `employment or employment conditions are a major contributing cause of the condition complained of.'" "A possibility is insufficient and a probability is necessary."

Wise, 2006 SD 80, ¶ 21, 721 N.W.2d at 468 (internal citations omitted).

[¶ 8.] We review evidentiary rulings under an abuse of discretion standard. McDowell v. Citibank, 2007 SD 52, ¶ 26, 734 N.W.2d 1, 10. An abuse of discretion "is not whether we would have made the same ruling, but whether we believe a judicial mind, in view of the law and the circumstances, could have reasonably reached the same conclusion." State v. Mattson, 2005 SD 71, ¶ 13, 698 N.W.2d 538, 544 (citations omitted). An error will not be overturned unless it "in all probability . . . produced some effect upon the final result." Id.; McDowell, 2007 SD 52, ¶ 26, 734 N.W.2d at 10.

[¶ 9.] Gerlach contends that the ALJ committed reversible error by failing to consider certain stipulated evidence. Specifically, Gerlach claims that the ALJ erroneously rejected South Dakota Retirement System (SDRS) (D-2) Physician Evaluation Forms. As part of the evidence submitted to the ALJ, the State assembled a binder containing all of Gerlach's relevant medical history and both parties stipulated to the files' admission. Within these voluminous records were six SDRS (D-2) Physician Evaluation Forms. A SDRS (D-2) form is a single sheet of paper with small areas for the physician's comments and boxes for the physician to check regarding the cause of the patient's injury and the patient's capacity to work. Each form was signed by a physician. On three of the forms, the respective physician checked the box which affirmed that Gerlach's "condition is due to injury or sickness arising out of [Gerlach's] employment."

[¶ 10.] Although the parties stipulated to the admission of the SDRS forms without objection, the ALJ acted sua sponte and disregarded the forms, based upon SDCL 3-12-142.¹ That statute provides:

An application for disability benefits pursuant to this chapter [South Dakota Retirement System], any associated evidence and documents, and the disability determination and decision related thereto shall be inadmissible and nondeterminative for any associated proceeding relative to [workers' compensation].

SDCL 3-12-142. (emphasis added).

[¶ 11.] Generally, a party's stipulation to admit evidence serves as a waiver to any evidentiary objections the party could have raised. Stipulations permit a more amiable proceeding, cut costs of litigation and expedite the judicial process. Therefore, stipulations that are "not against good morals, or sound public policy, have been and will be enforced." In re New York, L. & W. R.R. Co., 98 N.Y. 447, 1885 WL 10574, at *3 (N.Y. March 10, 1885) (stating that "[p]arties by their stipulations may in many ways make the law for any legal proceeding to which they are parties, which not only binds them, but which the courts are bound to enforce"). See also In re Malloy's Estate, 278 N.Y 429, 17 N.E.2d 108, 109 (1938) (stating "`[p]arties by their stipulations may in many ways make the law for any legal proceeding to which they are parties, which not only binds them, but which the courts are bound to enforce. They may stipulate away statutory, and even constitutional rights'") (citation omitted); Cobbs v. Allied Chem. Corp., 443 Pa.Super. 386, 661 A.2d 1375, 1377 (1995) (noting "[i]t is well-established that parties, by stipulation, may bind themselves on all matters except those affecting jurisdiction and prerogatives of the court") (citation omitted); WIGMORE, EVIDENCE § 7a (Tillers rev.1983) (stating parties may stipulate where law would exclude the evidence).

[¶ 12.] Stipulations are typically upheld, unless the "usual rule of exclusion thereby suspended were one affecting a specific third person's interests or affecting vital general policies independent of the contracting parties." WIGMORE, supra, § 7a (providing an example of a forbidden stipulation as: "a waiver of the privilege against disclosing official's secrets of state"). We cannot surmise any "vital" general policy that would forbid the parties' stipulation in this case.

[¶ 13.] When construing stipulations, courts "adopt the interpretation that is the most reasonable and probable, bearing in mind the objects which the parties intended to accomplish through the agreement." Cobbs, 661 A.2d at 1377. In this case, the stipulation allowed for the ALJ to consider all of the pertinent evidence which tended to prove or disprove the causation and extent of Gerlach's injuries. For the ALJ to disallow the stipulated forms was an abuse of discretion.

[¶ 14.] Although the ALJ erred by not considering the SDRS forms, as properly stipulated, the error did not constitute reversible error. The parties did "not stipulate that [the evidence] was to be taken as conclusive, and the question of [the experts'] credibility and the weight that should be accorded their [records] remained to be considered by the [fact finder]." Southern California Edison Co. v. Gemmill, 30 Cal.App.2d 23, 85 P.2d 500, 502 (1938); People on Complaint of DeAngelis v. Guiseppe, 97 N.Y.S.2d 486, 487 (N.Y.Child.Ct.1949), order aff'd, 276 A.D. 1102, 96...