Honeywell v. Workers' Comp. Appeals Bd.

• Decision Date: 20 December 2002
• Docket Number: No. B156438.,B156438.
• Citation: 104 Cal.App.4th 829,128 Cal.Rptr.2d 562
• Parties: HONEYWELL, Petitioner, v. WORKERS' COMPENSATION APPEALS BOARD of the State of California, and William Wagner, Respondents.
• Court: California Court of Appeals Court of Appeals

128 Cal.Rptr.2d 562

104 Cal.App.4th 829

HONEYWELL, Petitioner, v. WORKERS' COMPENSATION APPEALS BOARD of the State of California, and William Wagner, Respondents.

No. B156438.

Court of Appeal, Second District, Division 3.

December 20, 2002.

Kegel, Tobin & Truce and D'Arcy T. Swartz, Long Beach, for Petitioner.

Clopton, Penny & Brenner, Los Angeles, and Ronald R. Kolitz as Amicus Curiae on behalf of Petitioner.

Laughlin, Falbo, Levy & Moresi, LLP and James C. Hester, Pasadena, as Amicus Curiae on behalf of Petitioner.

Turchin & Turchin and Raymond L. Turchin, Los Angeles, for Respondent.

William A. Herreras, Grover Beach, as Amicus Curiae on behalf of Respondent.

CROSKEY, J.

The Workers' Compensation Appeals Board (WCAB) found that petitioner, Honeywell, formerly known as Allied Signal Aerospace Company (Honeywell), was "reasonably certain" in 1998 that its employee, respondent William Wagner, was psychiatrically injured or was claiming psychiatric injury under Labor Code section 5402.¹ The WCAB therefore determined that Honeywell had a duty to provide a claim form under section 5401,² which it failed to do. The WCAB concluded that by Honeywell's breach of its duty to provide the claim form, the 90-day period to deny the injury under section 5402 began and expired without rejection of Wagner's claim; as a result, his claimed psychiatric injury is presumed compensable.

Section 5401, subdivision (a), however, expressly requires that an employer have "notice or knowledge of injury under Section 5400 or 5402" before the duty to provide a claim form is triggered; the employer's 90-day period in which to reject an employee's claim does not even commence to run until the completed claim form has been filed with the employer.³ In this case, the WCAB has held that it is enough, in order to commence the running of the 90-day period, for the employer to simply be "reasonably certain" of the employee's injury and to have failed to provide the required claim form.

The WCAB had no legal authority to substitute "reasonably certain" for the statutory language enacted by the Legislature. Therefore, in the absence of a finding that Honeywell was precluded under the doctrine of estoppel, from asserting that the 90-day period could not begin to run until it had been served with the completed claim form, the WCAB could not properly find that the 90-day period had commenced to run at an earlier time.

We therefore annul the decision of the WCAB.

FACTUAL AND PROCEDURAL BACKGROUND

William Wagner, a sheet metalist for Honeywell for over 16 years, claimed work-related headaches and injuries to his psyche and skin due to employment from January 1, 1995, through October 16, 1998.

Honeywell provided an on-site medical clinic which recorded medical information reported by employees. Wagner's medical record dated July 20, 1998, indicates he informed the clinic that management was prejudiced against him and hampered his promotion and transfer. Such record also reflects that Wagner stated (1) he could not take it anymore, (2) his wife wanted him to quit due to stress, (3) he had lost 30 pounds, (4) he was anxious and agitated and (5) his doctor had prescribed medications for work stress.

On October 16, 1998, Wagner was admitted into a psychiatric hospital, and his wife, Linda Wagner, called Honeywell and left a message with the Human Resources Disability Coordinator, Nyssa Hawkins, to the effect that her husband had been hospitalized, and that his supervisor, Mike Rawlings, and others at work continued their head games and had pushed her husband over the edge.⁴ Linda Wagner also related there was concern about her husband's job and asked for disability forms. On October 20,1998, Hawkins phoned Linda Wagner to confirm receipt of a doctor's note verifying disability, and that disability forms would be sent.

On or about January 10, 1999, Wagner faxed to Honeywell a medical leave request form, on which a box was checked that the injury was work related. In a letter to Wagner dated January 11, 1999, Linda Wood, who was in personnel and handled workers' compensation, wrote that she had received the information from the medical department and was enclosing a claim form and pamphlet explaining workers' compensation.

On or about January 13, 1999, Wagner retained an attorney and completed a claim form, which was served on Honeywell on January 15, 1999. Honeywell then denied the claim by letter of March 31, 1999.

In support of his injury claim, Wagner obtained a medical report from his treating psychiatrist, Thomas Curtis, M.D. Dr. Curtis diagnosed major depression with anxiety and panic attacks, which were industrial. Dr. Curtis concluded that Wagner had permanent mental impairment ranging from slight to slight to moderate, with a need for future medical care and vocational rehabilitation.

Honeywell obtained a rebuttal medical opinion from psychologist, Mory Framer, Ph.D. Dr. Framer concluded Wagner's psychiatric condition was caused by good faith personnel actions, and thus was not compensable,⁵ or non-industrial factors.

At trial, the matter was submitted to the workers' compensation judge (WCJ) without testimony in order to determine whether the injury should be presumed compensable under section 5402. The WCJ found that the 90-day period under section 5402 had ended on January 15, 1999, and the psychiatric injury was therefore presumed compensable unless rebutted by evidence not available by that date. The WCJ explained that Honeywell had sufficient information and notice as of July 20, 1998, to require provision of the claim form. Even if that were not so, the very latest the claim form should have been provided by Honeywell was following the contact with Linda Wagner on October 16, 1998. The WCJ further stated that his decision was supported by principles of estoppel, citing Shoai-Ahari v. Zenith Ins. Co. (1992) 21 Cal. Workers' Comp. Rptr. 14 (Shoai-Ahari ),⁶ or the duty that arose upon demand, citing Janke v. State of Calif. (1991) 19 Cal. Workers' Comp. Rptr. 310 (Janke).

In Janke, the employer and insurer refused to provide a claim form when requested by an employee who was claiming psychiatric injury. The employee retained an attorney as recommended by the insurer, and a completed claim form was served on the employer. The employer denied the claim within 90 days of being served with the completed claim form. The WCAB panel held, however, that the 90-day period allowed to the employer under section 5402 had already expired because it had commenced to run when the employer received knowledge of the injury claim and had deliberately refused to provide the claim form to the employee.⁷ The WCAB panel found such conduct to be egregious and stated that it would not allow claim procedures to be manipulated intentionally or negligently so as to extend the period in which a claim must be accepted or rejected.

In this case, Honeywell filed for reconsideration with the WCAB. It requested that the WCAB issue an en banc decision resolving the issue as to whether the 90-day period begins before the claim form is filed with the employer, and if so, under what circumstances. Honeywell argued that its denial of compensability under section 5402 was timely because it was within 90 days of the date when the claim form was actually delivered by Wagner.

Honeywell also argued that there was no egregious conduct to justify estoppel as in Janke. Moreover, according to Honey-well, Shoai-Ahari actually supports the proposition that before the 90-day period can begin to run, the completed claim form must be filed with the employer. Alternatively, Honeywell contended that even if the 90-day period begins with knowledge of an injury or claim, the evidence in this case did not establish the requisite knowledge since co-employees were aware of the non-industrial stresses documented in the medical records. Finally, Honeywell urged, the documentary evidence lacked foundation that an employee with sufficient authority had received or recorded the contacts with Wagner and his wife.

In the report on reconsideration, the WCJ recommended that the WCAB affirm the decision en banc, because Honeywell was twice placed on notice of the industrial injury or claim thus creating a duty to investigate and timely provide the claim form.

The WCAB granted reconsideration and issued an en banc decision in Wagner v. Allied Signal Aerospace (2001) 66 Cal. Comp.Cases 483, 2001 WL 548597 (Wagner). It held that the 90-day period alternatively begins when an employer is "reasonably certain" of an industrial injury or claim and breaches the duty to provide the claim form, citing Janke and Thompson v. County of Stanislaus (1996) 25 Cal. Workers' Comp. Rptr. 24 (no breach of duty to provide claim form because employer not "reasonably certain" of industrial injury or claim). The WCAB further held that when the employer belatedly provides the claim form, the 90-day period is tolled until the completed claim form is filed by the employee. The WCAB indicated it was persuaded by comments in Janke that sections 5401 and 5402 were intended to encourage employers to promptly provide benefits or investigate claims, which should not be circumvented by the failure to provide the claim form.

The WCAB rescinded the WCJ's decision and remanded the matter for application of the "reasonably certain" standard. The "reasonably certain" standard was basically defined as awareness of facts that would lead a reasonable person to conclude, with some certainty, rather than by guess or speculation, an industrial injury as set forth in section 5401, subdivision (a), had occurred or was being asserted. The WCAB also remanded for the record to be further developed, if needed, to determine whether the employees involved had sufficient authority to impute notice or knowledge to Honeywell.

The parties again proceeded to trial before the WCJ. Linda Wagner testified regarding the messages she left...