Hagen v. Labor and Industry Review Com'n, 94-0374

CourtUnited States State Supreme Court of Wisconsin
Citation210 Wis.2d 12,563 N.W.2d 454
Docket NumberNo. 94-0374,94-0374
PartiesAdela S. HAGEN, Plaintiff-Appellant, v. LABOR AND INDUSTRY REVIEW COMMISSION, Hess Memorial Hospital Association, Inc., a Wisconsin corporation and Fire and Casualty Insurance Company of Connecticut, Respondents- Respondents- Petitioners.
Decision Date06 June 1997

For the respondent-respondent-petitioner, LIRC, there was oral argument by Lowell E. Nass, Assistant Attorney General, with whom on the briefs was James E. Doyle, Attorney General.

For the respondents-respondents-petitioners, Hess Memorial Hospital and Fire & Casualty Insurance Company of Connecticut, there were briefs by Ronald S. Aplin, Frederick J. Smith and Peterson, Johnson & Murray, S.C., Madison and oral argument by Ronald S. Aplin.

For the plaintiff-appellant there was a brief by John R. Orton and Curran, Hollenbeck & Orton, S.C., Mauston and oral argument by John R. Orton.

Amicus curiae brief was filed by Michael H. Gillick and Murphy, Gillick, Wicht and Prachthauser, Milwaukee for the Wisconsin Academy of Trial Lawyers.

Amicus curiae brief was filed by Thomas M. Rohe and Otjen, Van Ert, Stangle, Lieb & Weier, S.C., Milwaukee for the Wisconsin Insurance Alliance.

Amicus curiae brief was filed by James R. Gorton and Denissen, Kranzush, Mahoney & Ewald, S.C., Green Bay for the Civil Trial Counsel of Wisconsin.

Amicus curiae brief was filed by Eric E. Hobbs and Michael, Best & Friedrich, Milwaukee for the Wisconsin Manufacturers & Commerce.


¶1 The respondents, the Labor and Industry Review Commission (LIRC), Hess Memorial Hospital Association, Inc. (the Hospital), and Fire and Casualty Insurance Company of Connecticut (the Insurer), seek review of a published decision of the court of appeals. 1 The court of appeals reversed a circuit court decision which upheld LIRC's determination that injuries sustained by the plaintiff, Adela S. Hagen, were scheduled injuries for purposes of the Wisconsin Worker's Compensation Act (WCA). The petitioners assert that the court of appeals erroneously failed to defer to LIRC's long-standing view that under the permanent partial disability (PPD) schedule, 2 a shoulder injury is measured as "[t]he loss of an arm at the shoulder." We conclude that the court of appeals should have deferred to LIRC's reasonable interpretation. We also conclude that there is credible and substantial evidence supporting LIRC's determination that Hagen suffered only a scheduled permanent partial disability as a result of her injuries. Accordingly, we reverse the decision of the court of appeals.

¶2 Hagen worked as a nurse's aide at the Hospital from 1979 until 1989. On May 5, 1989, while lifting a patient out of a wheelchair and into bed, Hagen felt a "pull" in her right arm, chest, and shoulder that resulted in immediate pain and difficulty in lifting objects. After reporting her injury to the Hospital, Hagen saw a number of physicians and pursued several months of treatment involving physical therapy, medication, and eventual surgery on her shoulder.

¶3 Hagen filed a worker's compensation claim. At the hearing before the administrative law judge (ALJ), Hagen testified that she suffered from injuries to her arm, shoulder and upper back. Medical testimony and records supported her assertion. For example, Dr. James Logan testified as to Hagen's limited range of motion and pain in the shoulder and bicep area. He also stated that the poor posture produced by Hagen's injuries may eventually result in abnormal curvature of her spine. Dr. Diana Kruse, who performed surgery on Hagen's shoulder, concluded that she would:

award an additional 5% wholeperson disability on the basis of the myofascial pain in the upper and mid back area. This is related to the shoulder girdle muscle attachments to the trunk and abnormal muscle tension in the upper, mid and low back areas because of chronic pain that the patient experiences.

¶4 Other medical evidence suggested that Hagen's permanent partial disability was limited to injuries to the shoulder and arm. Dr. Panna Varia initially concluded that Hagen had a three percent total body disability due to right shoulder problems and the myofascial pain symptoms. However, after Dr. Kruse performed surgery on Hagen's shoulder, Dr. Varia changed her opinion, rating Hagen's permanent partial disability as seven percent at the shoulder joint.

¶5 The ALJ determined that Hagen's shoulder and arm injuries were scheduled injuries. The ALJ also found that Hagen's back injury was "very minor and not serious enough to serve as a basis for a loss of earning capacity claim." LIRC adopted the ALJ's factual determinations, with one modification not pertinent to our inquiry. In its memorandum opinion, LIRC found that "there is no doubt" that Hagen suffered both an arm and a shoulder injury. However, LIRC concluded that both were included in the PPD schedule under § 102.52(1), "[t]he loss of an arm at the shoulder."

¶6 As for Hagen's back injury, LIRC made the following finding of fact:

[w]hile applicant may have occasional problems in areas beyond the shoulder these appear to be of a relatively acute, transient, non-permanent nature. When compared to her shoulder and arm problems there is further doubt that any of these minor problems, per se, render applicant less employable. Rather it is the scheduled problems with applicant's shoulder and arm that are significant.

On that basis, LIRC determined that Hagen's back injury did not constitute an unscheduled permanent partial disability.

¶7 Hagen sought judicial review, and the circuit court affirmed LIRC's decision. Hagen appealed and the court of appeals reversed, concluding that LIRC's interpretation of § 102.52(1) was contrary to the plain meaning of the statute. While the court of appeals agreed with LIRC that Hagen suffered a scheduled arm injury, the court concluded that Hagen's shoulder injury was not covered by the § 102.52(1) PPD schedule. The court did not address LIRC's factual determination that Hagen suffered no permanent partial disability in areas beyond the arm and shoulder. LIRC, the Hospital, and the Insurer petitioned this court for review.

¶8 The first issue in this case is whether the § 102.52 provision covering "[t]he loss of an arm at the shoulder" includes an injury to the shoulder. Statutory interpretation is a question of law which a court generally reviews under a de novo standard. Stockbridge School Dist. v. DPI, 202 Wis.2d 214, 219, 550 N.W.2d 96 (1996). However, a reviewing court will employ one of three levels of deference when considering an administrative agency's interpretation of a statute: no weight, due weight, or great weight. See Jicha v. DILHR, 169 Wis.2d 284, 290-91, 485 N.W.2d 256 (1992).

¶9 Great weight deference to an agency's interpretation of a statute is appropriate when: (1) the agency is charged by the legislature with administering the statute; (2) the interpretation of the agency is one of long standing; (3) the agency employed its expertise or specialized knowledge in forming the interpretation; and (4) the agency's interpretation will provide uniformity in the application of the statute. See Harnischfeger Corp. v. LIRC, 196 Wis.2d 650, 660, 539 N.W.2d 98 (1995).

¶10 Applying the four-factor test set forth in Harnischfeger to this case, we conclude that LIRC's interpretation of § 102.52(1) is entitled to great weight deference. First, the Department of Workforce Development (DWD) 3 is charged under Wis. Stat. § 102.14(1) with administering Chapter 102, and both the DWD and LIRC are charged with interpreting the statute and making factual findings when determining a claimant's entitlement to worker's compensation benefits. 4 Second, we note that DWD and LIRC have consistently interpreted the phrase "the loss of an arm at the shoulder" to include injuries to the shoulder. 5 Third, we conclude that DWD and LIRC employed their specialized knowledge in the areas of employment injuries and compensation in arriving at the determination that shoulder injuries are scheduled under § 102.52. Finally, DWD and LIRC's interpretation provides uniformity in the application of § 102.52(1) to shoulder injuries.

¶11 Having determined that great weight deference is the proper standard of review in this case, we will sustain LIRC's interpretation of § 102.52(1) unless it is unreasonable. Lisney v. LIRC, 171 Wis.2d 499, 506, 493 N.W.2d 14 (1992). An agency's interpretation of a statute is unreasonable if it "directly contravenes the words of the statute, is clearly contrary to legislative intent, or is otherwise ... without rational basis." Lisney, 171 Wis.2d at 506, 493 N.W.2d 14.

¶12 The court of appeals concluded, and Hagen asserts, that LIRC's interpretation of § 102.52(1), which includes her shoulder injury as a scheduled injury, directly contravenes the language of the statute, is unreasonable, and is without a rational basis. Hagen v. LIRC, 201 Wis.2d 51, 57, 547 N.W.2d 812 (Ct.App.1996). According to the court of appeals, the plain meaning of the § 102.52(1) phrase, "[t]he loss of an arm at the shoulder," unambiguously excludes shoulder injuries from the PPD schedule. The court reasoned that "at the shoulder" simply identifies the location at which the arm is lost, and that accepting LIRC's interpretation of the statute would essentially require a court to rewrite § 102.52(1) as "[t]he loss of an arm and the shoulder," rather than "[t]he loss of an arm at the shoulder." Id. at 60, 547 N.W.2d 812 (emphasis in original).

¶13 While we conclude that the court of appeals' interpretation of § 102.52(1) is a reasonable one, we also conclude that it is not the only reasonable interpretation of § 102.52(1). As we stated in Harnischfeger:

The threshold question must be whether or not the statute in question is ambiguous. If the statute is ambiguous, an agency's interpretation cannot, by...

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