Jones v. Cutler Oil Co.

• Decision Date: 01 October 1958
• Docket Number: No. 1,1
• Parties: Jacob C. JONES, Plaintiff-Appellee, v. CUTLER OIL COMPANY and State Accident Fund, Defendants-Appellants. ,
• Court: Michigan Supreme Court

Page 74

97 N.W.2d 74

356 Mich. 487

Jacob C. JONES, Plaintiff-Appellee, v. CUTLER OIL COMPANY and State Accident Fund, Defendants-Appellants.

No. 1, Oct. Term, 1958.

Supreme Court of Michigan.

June 6, 1959.

Harry F. Briggs, Lansing, for defendants-appellants. Richard J. Anderson, Lansing, of counsel.

Warner & Hart, Lansing, for plaintiff-appellee.

Before the Entire Bench.

SMITH, Justice.

The claimant and plaintiff, Jacob C. Jones, was hurt while working in a filling station. He fell, and injured his leg. After getting out of the hospital he was offered work by his former employer, but it involved climbing ladders, which he could not do, so he found another job, within his lessened capacity. This was with another employer and at a lower pay. For such loss in wage-earning capacity he was ultimately awarded compensation for two-thirds of the wage loss he had suffered. ¹ Had nothing else occurred he could have drawn this compensation as long as he was required to be on his favored work (up to 500 weeks from the date of the injury.)

But misfortune again smiled on him. He had been on the new, lower-pay job for only a few days when he suffered another accident. Fingers were cut off both of his hands. For such amputations our law provides specific payments, so much for a leg, so much for an arm, so much for a finger. C.L.S.1954, § 412.10 [Stat.Ann.1955 Cum.Supp. § 17.160].

Our issue arises in this way: Compensation for the leg injury had been paid voluntarily for a total of 42 weeks, representing total disability from December 16, 1954 to October 5, 1955. Such payments were then stopped, as of October 6, 1955, upon the ground that the employee had returned to work 'at the same wage as when injured.' Application for hearing was filed on March 4, 1957, contesting the fact of return to work at the same wage. Upon the hearing held thereon upon April 30, 1957 voluntary lump-sum payments by the second employer, on account of the amputations arising from the second injury, were made a matter of record. It was the ruling of the referee, with respect to such payments, that they did not 'alter plaintiff's entitlement to compensation' arising from the leg injury. Appeal to the Appeal Board resulted in a division upon the issue, the dissenting member stating that 'the plaintiff is not entitled to any further compensation for his first injury covering the period of time for which he has been fully compensated for his second injury at the rate of $42.00 per week,' and, further, that 'the plaintiff will not be eligible for further compensation for his first injury until the expiration of the time for which he has been paid full compensation for his second injury.' The majority held to the contrary and the case is before us upon leave granted.

Appellants assert that 'an award of continuing compensation is not proper where the plaintiff is also receiving compensation from another insurance carrier for a subsequent injury.' We are cited to no portion of the statute so stating. Rather, it is urged that such award 'would do violence to the original concepts embodied in the act' and that 'the combined compensation during this period exceeds the maximum provided in the act.' Such maximum, appellants argue, arises thus:

'The workmen's compensation act provides but a single rate of compensation, to-wit, 66 2/3[%] of the employee's average weekly wage, and this percentage is applicable to all disabilities and is the maximum compensation provided.'

The question presented involves the correlation of the wage-loss awards with those of the specific awards. Are they, upon the facts before us, mutually exclusive?

The question is not complex unless made so. Here the workman suffered two separate and distinct, unrelated injuries, to separate parts of the body, and while in the employ of different employers. We will first consider the matter of compensation for the leg injury. It was based upon the workman's decreased earning capacity because of the injury suffered. This, in turn, depends upon a host of factors: it involves the general wage level since the accident, the hours worked, the job performed, the skill and training required, even, at times, the payment of sympathetic wages out of the largess of the heart. Wages actually earned are a factor, but only one. The real inquiry relates to the monetary worth of the injured workman's services in the open labor market under normal employment conditions. See Hood v. Wyandotte Oil & Fat Co., 272 Mich. 190, 261 N.W. 295; Pigue v. General Motors Copr., 317 Mich. 311, 316, 317, 26 N.W.2d 900. Thus it was that plaintiff here was awarded compensation under section 10 of part 2 'at 66 2/3% of the difference between his average weekly wage before the December 15, 1954 injury of $97.85 and his average weekly wage he is able to earn thereafter of $66.16 per week which we [the Appeal Board] find is $21.18 per week.'

But there is another basis for compensability in certain enumerated cases. These involve the 'schedule' awards (from the language of the statute saying that: 'In cases included by the following schedule, the disability in each such case shall be deemed to continue for the period specified, and the compensation so paid for such injury shall be as specified therein, to wit:' [here follow the specific awards for loss of fingers, toes, hands, arms, eyes, et cetera]. Emphasis above added.) These sums represent a stated legislative determination that the enumerated injuries shall have compensation at a fixed figure. Thus the injury is 'deemed' to continue for a specified number of weeks, regardless of the actual period of continuance. The compensation paid does not turn upon wages lost. Wage loss, in fact, or gain, is immaterial. See, e. g., Bethlehem Steel Co. v. Cardillo, 2 Cir., 229 F.2d 735. It is an arbitrary, fixed sum, and it 'shall' be paid as specified. The purpose of thus fixing an arbitrary sum was to attempt to minimize the uncertainty, with attendant litigation, over a mixed economic and medical question of the utmost complexity. See Riesenfeld and Maxwell, Modern Social Legislation, p. 293.

The law, it must be stressed, does not provide that the specific awards granted in section 10 depend upon the difference between wages earned before the accident and wages earned afterwards. In other words, the wage loss due to an amputation is not a factor in the amount of the recovery. The law presumes a fixed amount of loss. If a leg amputee, through some miracle, were able to return to his work, fully recovered, in two weeks, the award would nevertheless continue for a total of 215 weeks. The disability, says that statute, 'shall be deemed to continue for the period specified.'

On the contrary, in case of partial disability where a schedule award is not made by statute, compensation is based on 'the difference between * * * wages before the injury and * * * wages which he is able to earn thereafter * * *.' Thus the essential difference: With respect to the schedule awards the amount is fixed and arbitrary, though its numerical magnitude is not the same for all, since the amount of the arbitrary sum depends upon how much the injured party was earning when he was hurt. To be contrasted with these schedule awards, then, are the first group above mentioned, i. e., those dependent entirely upon loss of wage earning capacity. Here our law applies a 'before and after' test, the award being computed as a percentage of the difference between wages the accident victim was able to earn before the injury and those he is able to earn thereafter.

We have long, in fact, recognized that 'a claim for a statutory schedule award for loss of a member, such as the loss of an eye or an arm or a foot, under 2 Comp.Laws 1929, § 8426, is separate and distinct from, and should not be confused with, a claim under such statute for compensation for disability not resulting in the loss of a member. We have often recognized the distinction between the two types of disability under the compensation law.' Henderson v. Consumers Power Co., 301 Mich. 564, 580, 4 N.W.2d 10, 17. See also Morgan v. Lloyds Builders Inc., 344 Mich. 524, 73 N.W.2d 880.

The difference between the specific awards and those involving a wage loss was well put recently by the Supreme Court of the United States in Alaska Industrial Board v. Chugach Electric Ass'n, Inc., 356 U.S. 320, 78 S.Ct. 735, 737, 2 L.Ed.2d 795. In this case the workman's injuries necessitated amputation of the left arm, the right leg, and toes on the left foot. The injuries to the left foot were, because of burns received, slow in healing and, consequently, a long period of total disability ensued. The workman was paid a lump sum award because of the amputations (these also constituting 'total and permanent disability' under the Alaska workmen's compensation act ²) and he 'then applied to the Alaska Industrial Board for continuing benefits for temporary disability, despite his receipt of the lump-sum award for total and permanent disability.' In upholding such award the court spoke as follows:

'The lump-sum awards for total and permanent disability under this Compensation Act ignore wage losses. Whatever the employee may have made before, whatever his wages may be after the injury, the award is the same. To that extent it is an arbitrary amount. But it is the expression of a legislative judgment that on average there has been a degree of impairment, and whatever may be the fact in a particular case, the lump sum should be paid without more. See 2 Larson, Workmen's Compensation, § 58-10.

'There may, nevertheless, be a continuing ability to do some work; and as long as that remaining ability exists there is a factual basis for temporary disability awards. That seems to be the theory of the Act for it extends those awards to 'all injuries causing temporary disability' and bases them on the 'average daily wage earning capacity' of the injured employee, as...