K-Mart Corp. v. Novak

• Decision Date: 27 April 1988
• Docket Number: No. 93A02-8708-EX-330,K-MART,93A02-8708-EX-330
• Citation: 521 N.E.2d 1346
• Parties: CORPORATION, Defendant-Appellant, v. Joseph NOVAK, as Husband of Margaret M. Novak, and as Administrator of the Estate of Margaret M. Novak, Plaintiff-Appellee.
• Court: Indiana Appellate Court

Page 1346

521 N.E.2d 1346

K-MART CORPORATION, Defendant-Appellant, v. Joseph NOVAK, as Husband of Margaret M. Novak, and as

Administrator of the Estate of Margaret M. Novak,

Plaintiff-Appellee.

No. 93A02-8708-EX-330.

Court of Appeals of Indiana,

First District.

April 27, 1988.

Rehearing Denied June 8, 1988.

Douglas F. Stevenson, Stevenson, Rusin & Friedman, Ltd., Chicago, for defendant-appellant.

Terrence M. Rubino, Hammond, for plaintiff-appellee.

RATLIFF, Chief Judge.

STATEMENT OF THE CASE

K-Mart Corporation (K-Mart) appeals from the Industrial Board of Indiana's (Board) award of workmen's compensation death benefits to Joseph Novak, husband and widower of Margaret Novak, deceased employee. We affirm in part, reverse in part, and remand with instructions.

FACTS

On May 28, 1985, around 6:00 P.M. James Koslow engaged in a maniacal shooting spree in St. John, Indiana. Koslow's shooting spree began on the eastside of U.S. Highway 41 and crossed to the west side of the highway into a K-Mart parking lot and ended inside the store. During the shooting spree Koslow shot and killed three (3) persons and wounded five (5) others. Margaret Novak was one of the persons killed. Margaret was employed by K-Mart as a clerk and was working at her station in the store at the time of her death. Margaret was the wife of Joseph Novak.

On May 31, 1985, K-Mart wrote to Joseph as follows:

"Pursuant to the Indiana Worker's Disability Compensation Statute, you are entitled to reasonable expenses of burial in the amount not to exceed $5,000."

Record at 10. Thereafter, K-Mart paid Joseph Two Thousand Dollars ($2,000) for burial expenses. Joseph received another letter from K-Mart which stated in part as follows:

"Please be advised that at this time we do not agree that Mr. Novak is a presumptive dependent."

On August 8, 1985, Joseph filed an application for compensation with the Board. K-Mart responded and argued among other things that Margaret's death did not "arise out of" her employment. On February 20, 1987, the Full Industrial Board found that Margaret's death was an accident which arose out of and in the course of her employment and awarded death benefit compensation to Joseph who was found to be a presumptive dependent. The Board found further that K-Mart was estopped by its representations from denying applicability of the Workmen's Compensation act and from challenging Joseph's right to recovery. K-Mart appeals the Board's findings and award.

ISSUES

Six (6) issues have been presented for review:

1. Whether the Board improperly determined that Margaret's death arose out of her employment?

2. Whether the Victims of Violent Crimes Compensation Act, Indiana Code sections 16-7-3.6-1 et seq. supersedes and prohibits recovery under the Workmen's Compensation Act, Indiana Code sections 22-3-2-1 et seq.?

3. Whether the decision of Portman v. Steveco (1983), Ind. App., 453 N.E.2d 284, should be overturned to the extent that presumptive dependency is applied to husbands?

4. Whether the Board determined improperly that K-Mart was estopped from denying applicability of the Workmen's Compensation Act and from raising defenses other than Joseph's status as a presumptive dependent?

5. Whether the Board erred by decreeing a lump sum payment?

6. Whether this court should assess attorney's fees and damages against K-Mart for challenging compensation and for filing an appeal without merit?

DISCUSSION AND DECISION

In challenging an award of compensation by the Board, K-Mart confronts a strong standard of review. This court will not disturb the Board's findings unless the evidence is undisputed and leads unerringly to a contrary result. Sears Roebuck and Co. v. Murphy (1987), Ind.App., 508 N.E.2d 825, 829 (transfer pending); Blaw-Knox Foundry and Mill Machinery, Inc. v. Dacus (1987), Ind.App., 505 N.E.2d 101, 102; Burger Chef Systems, Inc. v. Wilson (1970), 147 Ind.App. 556, 558, 262 N.E.2d 660, 662. This court neither reweighs the evidence nor judges witness credibility as these are functions of the Board. Sears, at 829; Dacus, at 102; Wilson, 147 Ind.App. at 558, 262 N.E.2d at 662. This court must disregard all unfavorable evidence, and must examine only that evidence and the reasonable inferences that can be drawn therefrom which support the Board's findings and decision. Sears, at 829; Dacus, at 102.

Issue One

K-Mart argues first that the Board erred by determining that Margaret's death "arose out of" her employment as required by Indiana's Workmen's Compensation Act. Specifically, K-Mart argues that an accident does not "arise out of" the employment unless the employment is shown to involve a risk that is uncommon to the public, and peculiar to the employment. K-Mart suggests additionally that the risk of being shot by a lunatic was a risk common to the public and did not "arise out of" Margaret's employment. Thus, K-Mart argues the Board improperly awarded compensation.

K-Mart correctly points out that the person seeking the benefit of the Act carries the burden of proving its applicability. Lona v. Sosa (1981), Ind.App., 420 N.E.2d 890, 894, trans. denied; Wilson, 147 Ind.App. at 559, 262 N.E.2d at 662; Stanley v. Riggs Equipment Co. (1961), 133 Ind.App. 86, 90, 178 N.E.2d 766, 768. To recover under the Act a claimant must establish that an injury occurred "by accident arising out of and in the course of employment". Ind. Code Sec. 22-3-2-5; Evans v. Yankeetown Dock Corp. (1986), Ind., 491 N.E.2d 969, 973. This court construes these terms of the Act liberally and in favor of the employee so that the humane purposes of the Act will not be defeated. Evans, at 971. K-Mart recognizes that "arising out of", and "in the course of" are two separate elements, and only challenges the Board's determination as to the "arising out of" element. The "in the course of" element, which refers to the time, place, and circumstances of the accident, is unchallenged and clearly was established.

The "arising out of" element is referred to as the causal connection between the accident and the employment. An accident "arises out of" the employment when a causal relationship exists between the injury and the employment. Evans, at 975; Murphy, at 830. The causal connection is established by showing that a rational mind might comprehend that the accident was a risk incidental to the employment. Dacus, at 102. However, the risk need not be expected or foreseeable to be incidental to the employment. Id. at 102-03. The determination of whether the accidental risk was an incident of employment is fact sensitive, and accordingly, is entrusted to the Board. Murphy, at 829; Wayne Adams Buick, Inc. v. Ference (1981), Ind.App., 421 N.E.2d 733, 736, trans. denied.

As a general rule, under Indiana law a risk is incidental to the employment if the risk involved is not one to which the public at large is subjected. E.I. DuPont DeNemours v. Lilly (1948), 226 Ind. 267, 272, 79 N.E.2d 387, 389; Segally v. Ancerys (1985), Ind.App., 486 N.E.2d 578, 581; Lincoln v. Whirlpool Corp. (1972), 151 Ind.App. 190, 196, 279 N.E.2d 596, 599-600; Citizens' Independent Telephone Co. v. Davis (1950), 121 Ind.App. 20, 25, 94 N.E.2d 495, 498, trans. denied 229 Ind. 217, 97 N.E.2d 490. This general rule is referred to as the "increased risk" test. Olinger Const. Co. v. Mosbey (1981), Ind.App., 427 N.E.2d 910, 913, trans. denied; Lincoln, 151 Ind.App. at 196, 279 N.E.2d at 599. Our courts do not always require proof of an increased risk. For example in assault cases, especially in those involving traveling employees or employees subjected to street perils, the "arising out of" element can be satisfied without proof of an increased risk to the employee. Clem v. Steveco, Inc. (1983), Ind.App., 450 N.E.2d 550, 553; Suburban Ready Mix Concrete v. Zion (1983), Ind.App., 443 N.E.2d 1241, 1242; Ference, at 737; Mosbey, at 913; Burroughs Adding Machine Co. v. Dehn (1942), 110 Ind.App. 483, 503, 39 N.E.2d 499, 507; Lasear v. Anderson (1934), 99 Ind.App. 428, 434, 192 N.E. 762, 765. Our supreme court also appears to have dispensed with the need to show an increased risk in a recent case in which an employee was attacked and killed by a lunatic. Evans, at 975. These cases allow proof of a causal connection under the "positional risk" test. Olinger, at 913; 1 Larson,Workmen's Compensation Law Sec. 6.50 (1985).

Larson comments on the "positional risk" test, as follows:

"An important and growing number of courts are accepting the full implications of the positional-risk test: An injury arises out of the employment if it would not have occurred but for the fact that the conditions and obligations of the employment placed claimant in the position where he was injured. It is even more common for the test to be approved and used in particular situations. This theory supports compensation, for example, in cases of stray bullets, roving lunatics, and other situations in which the only connection of the employment with the injury is that its obligations placed the employee in the particular place at the particular time when he was injured by some neutral force, meaning by 'neutral' neither personal to the claimant nor distinctly associated with the employment."

1 Larson, at Sec. 6.50. Larson suggests that the positional risk test is used increasingly in assault cases to show the causal connection when the assault is shown to fall into a category ¹ of neutral risks. Id. at Sec. 11.30. Larson's neutral category of assaults includes:

"Those assaults which are in essence equivalent to blind or irrational forces, such as attacks by lunatics, drunks, small children, and other irresponsibles; completely unexplained assaults and assaults by mistake."

1 Larson, Sec. 11.30. The facts of the present case fit within Larson's category of neutral assaults. Margaret was killed during the shooting spree of a lunatic. Therefore, as in the traveling employee and the street risks cases, this court will...