Hartsell v. Richmond Lumber Co.

• Decision Date: 09 September 1986
• Docket Number: Docket No. 81580
• Citation: 398 N.W.2d 456,154 Mich.App. 523
• Parties: Katherine HARTSELL, Personal Representative of the Estate of Orville Hartsell, Deceased, Plaintiff-Appellee, v. RICHMOND LUMBER COMPANY, Defendant-Appellant, and Second Injury Fund, Defendant.
• Court: Court of Appeal of Michigan — District of US

Page 456

398 N.W.2d 456

154 Mich.App. 523

Katherine HARTSELL, Personal Representative of the Estate of Orville Hartsell, Deceased, Plaintiff-Appellee, v. RICHMOND LUMBER COMPANY, Defendant-Appellant and Second Injury Fund, Defendant.

Docket No. 81580.

Court of Appeals of Michigan.

Submitted June 12, 1986.

Decided Sept. 9, 1986.

Sablich, Ryan, Clinton & Zolkowski, P.C. by Theodore P. Ryan, East Lansing, for plaintiff-appellee.

O'Neill, Ackerman, Wallace & Doyle by Richard L. Alger, Jr. and Thomas E. Ackerman, Flint, for defendant-appellant.

Before MacKENZIE, P.J., and HOOD and MIES, ^* JJ.

PER CURIAM.

We entertain this case on remand from the Supreme Court, which directed this court to decide the matter as if on leave granted.

This case has a long and complex history. Employee Orville Hartsell injured his right knee in an October 8, 1965, accident which occurred during the course of his employment as a truck driver with defendant Richmond Lumber. Defendant paid Hartsell voluntary compensation from October 9, 1965, until February 25, 1967, where he was given favored work as a night watchman. He disliked the work and voluntarily quit. On October 9, 1967, Hartsell began working at Community Meat Plant and continued until that company closed on April 18, 1968.

Hartsell petitioned on December 22, 1967, for hearing on his claim for workers' disability compensation benefits arising out of the 1965 truck accident. At a hearing before referee James W. Nolan, defendant offered Hartsell his former night watchman job. In an April 28, 1969, decision, referee Nolan ordered compensation for total disability from the date of the accident to the date Hartsell began working as a night watchman, for partial disability up to the date of hearing, and for no compensation thereafter due to Richmond Lumber's offer of favored work employment, which Hartsell apparently refused. The Workers' Compensation Appeal Board (WCAB) affirmed referee Nolan's decision in an opinion and order issued on June 3, 1970. Both this court and the Supreme Court denied leave to appeal that decision.

Hartsell filed another petition for hearing on July 16, 1970, but voluntarily discontinued the action without prejudice. Thereafter, he began working part-time at Chamberlain's Shoe Mart, Inc., in September or October of 1974 and continued working there until at least September 19, 1979. On February 1, 1978, defendant Richmond Lumber closed the plant involved in this case.

Hartsell filed another petition for hearing on May 4, 1978, naming Richmond Lumber and the Second Injury Fund, alleging total and permanent disability arising from the 1965 accident and aggravation of this injury and additional injury caused by work in excess of restrictions. Following a September 19, 1979, hearing, hearing referee Edward H. DeVoe issued a decision holding: (1) that the WCAB's 1970 decision was res judicata; (2) that the only issue was whether Hartsell had lost industrial use of his legs owing to the 1965 injury; and (3) that Hartsell had not proven permanent and total disability or the loss of industrial use of his legs.

The WCAB dismissed Hartsell's appeal of hearing referee DeVoe's decision for failure to file a transcript on November 26, 1980. On December 19, 1980, Hartsell simultaneously moved to reinstate the WCAB appeal and filed an application for leave to appeal with this Court. This Court dismissed the appeal as premature, but the WCAB granted the motion to reinstate the appeal. In an opinion dated November 21, 1983, the WCAB (1) affirmed denial of differential benefits from the Second Injury Fund for total and permanent disability; (2) found that defendant Richmond Lumber had adequate notice of Hartsell's claim for continuing general disability, based upon withdrawal of favored work; (3) found that the 1970 WCAB opinion was not res judicata with respect to issues raised at the 1979 hearing; and (4) held that Hartsell was entitled to compensation from February 1, 1978, the date of the plant's closing (and withdrawal of the offer of favored work), to the date of Hartsell's death, which was sometime in 1983. Hartsell's personal representative was substituted as a party plaintiff following his death.

This Court denied defendant Richmond Lumber's application for leave to appeal. On November 9, 1984, the Supreme Court remanded to this Court for consideration of the appeal as if on leave granted. 419 Mich. 950, 357 N.W.2d 321 (1984).

I

First, we consider Richmond Lumber's contention that it did not receive adequate notice of Hartsell's intention to raise the favored work issue at the 1979 hearing because his petition raised only the issue of total and permanent disability due to loss of industrial use of both legs. We agree with the WCAB's finding that Richmond Lumber had actual notice that it was required to defend against the favored work issue.

Hartsell's injury occurred in October, 1965, but the two-year time period for filing the claim for compensation was extended by (1) Richmond Lumber's voluntary provision of compensation until February 25, 1967, and (2) the provision of favored work until Hartsell quit on June 24, 1967. See M.C.L. Sec. 418.381(1); M.S.A. Sec. 17.237(381)(1). Hartsell's timely December 22, 1967, petition was denied as it related to continuing compensation only because of decedent's refusal to accept favored work. The WCAB affirmed the denial in 1970 and admonished Richmond Lumber not to withdraw its bona fide offer of favored work.

Hartsell's second petition (against Richmond Lumber and Second Injury Fund) was filed after Richmond Lumber ceased operating in February, 1978. The petition identified the cause of the injury as the 1965 accident and "working in excess of restrictions ... [which] caused and aggravated back the bilateral leg pathology." The petition also stated: "Back and bilateral leg pathology--industrial loss of use of both legs--total and permanent disability."

Richmond Lumber claims this petition did not provide adequate notice that Hartsell was making a claim for general disability compensation benefits against Richmond Lumber based on withdrawal of the offer of favored work. The WCAB rejected this argument. In reviewing a Workers' Compensation Appeal Board decision, this Court must affirm if the proper legal standard has been applied, there is competent evidence to support the board's finding, and there is an absence of fraud. Collins v. Waterford Twp. School Dist., 118 Mich.App. 798, 801, 325 N.W.2d 585 (1982), lv. den. 417 Mich. 998 (1983), citing Const 1963, art 6, Sec. 28; M.C.L. 418.861; M.S.A. 17.237(861).

We find no legal impediment to affirming the WCAB's finding that Richmond Lumber had adequate and actual notice of the favored work issue. First, the petition itself cited the 1965 work-related accident as one cause of the injury. Although it did not specifically state "general disability," it stated "total and permanent disability" in describing the nature of the disability and referred to "back and bilateral leg pathology." The description of the nature of the disability in the petition, taken together with the cause of the injury, informed defendant Richmond Lumber that the 1965 injury and general disability compensation was at issue. With respect to general disability, the only continuing issue after the 1970 WCAB opinion was whether favored work was available.

The petition, although somewhat ambiguous, generally described the claim as required by M.C.L. Sec. 418.847; M.S.A. Sec. 17.237(847). Moreover, the uncontroverted affidavit of plaintiff's counsel demonstrates that Richmond Lumber had actual notice of the issue. The fact that Richmond Lumber was named at all in the petition demonstrates that favored work was at issue. ¹ Finally, Hartsell's counsel specified at the beginning of the hearing that the remaining issue concerned Richmond Lumber's liability after the plant's closing. After the parties argued about whether this ought to be an issue, hearing referee DeVoe concluded that Richmond Lumber was not out of the picture. Based on the foregoing, we affirm the WCAB's finding that Richmond Lumber had actual notice that it was required to defend against the favored work issue.

II

Richmond Lumber next argues that the WCAB improperly reinstated Hartsell's appeal because Hartsell did not order the transcript and no appeal may be reinstated without substantial compliance with procedural rules. Richmond Lumber cites Dries v. Chrysler Corp., 402 Mich. 78, 259 N.W.2d 561 (1977), for the proposition that the WCAB may reinstate an appeal dismissed for procedural reasons only if the appealing party has substantially complied with WCAB rules. This argument distorts the Dries holding. In Dries, the Court did not indicate that substantial compliance was the only ground which will permit the WCAB to reinstate a procedurally defective appeal.

In East Jordan Iron Works v. Workers' Compensation Appeal Board, 124 Mich.App. 324, 328, 335 N.W.2d 23 (1983), this court summarized the rules governing when reinstatement of an appeal is proper:

"In Pocs v Buick Motor Co, 207 Mich 591, 593; 175 NW 125 (1919), the Court pointed out that no provision in the statute or the rules allows a rehearing of a final order. In later cases, however, the Court stated the rule more broadly. In Letourneau v Davidson, 218 Mich 334, 339; 188 NW 462 (1922), the Court held that the board had no power to grant a rehearing to review the facts establishing liability as found by the board. On several occasions, the Court's statement of the rule was that the board had no power to grant a rehearing of its determinations. Panozzo v Ford Motor Co, 255 Mich 149, 150; 237 NW 369 (1931); Guss v Ford Motor Co, 275 Mich 30, 34; 265 NW 515 (1936); Fitzpatrick v Olds Div of General Motors Corp, 282 Mich 646, 648; 276 NW 709 (1937). Other cases explain that the rehearing which is prohibited is one which reopens a case for redetermination of...