Kasper v. State Acc. Ins. Fund Corp.

• Decision Date: 05 October 1988
• Citation: 93 Or.App. 246,761 P.2d 1345
• Parties: In the Matter of the Compensation of Richard G. Kasper, Claimant. Richard G. KASPER, Petitioner, v. STATE ACCIDENT INSURANCE FUND CORPORATION and North Santiam Paving Co., Respondents. WCB 84-08210; CA A44502.
• Court: Oregon Court of Appeals

Page 1345

761 P.2d 1345

93 Or.App. 246

In the Matter of the Compensation of Richard G. Kasper, Claimant.

Richard G. KASPER, Petitioner, v. STATE ACCIDENT INSURANCE FUND CORPORATION and North Santiam

Paving Co., Respondents.

WCB 84-08210; CA A44502.

Court of Appeals of Oregon.

Argued and Submitted Feb. 19, 1988.

Decided Oct. 5, 1988.

Edward J. Harri, Salem, argued the cause for petitioner. On the brief were J. David Kryger and Emmons, Kyle, Kropp, Kryger & Alexander, P.C., Albany.

Darrell E. Bewley, Asst. Atty. Gen., Salem, argued the cause for respondents. With him on the brief were Dave Frohnmayer, Atty. Gen., and Virginia L. Linder, Sol. Gen., Salem.

Before RICHARDSON, P.J., and NEWMAN and DEITS, JJ.

RICHARDSON, Presiding Judge.

Claimant seeks review of a Workers' Compensation Board order upholding the validity of a disputed settlement agreement and denying his aggravation claim. We conclude that the agreement is valid under ORS 656.236 and that the Board did not err in denying claimant's aggravation claim.

Claimant has a long history of back ailments; however, we recite only those conditions pertinent to the issues on review. In 1974, he was involved in a work related car accident which resulted in acute lumbar and cervical strains. Spinal x-rays taken in conjunction with treatment showed degenerative osteoarthritis and spondylosis. In October, 1976, he was awarded 15 percent permanent partial disability for back strain.

In 1977, claimant began work as a truck driver for North Santiam Paving Co., which was insured by SAIF. He filed an aggravation claim on December 3, 1980, complaining that his back condition had worsened from driving over rough roads. SAIF denied that claim, as well as a second claim filed by his treating physician in March, 1981. Both denials were consolidated for hearing, and the referee concluded that claimant's back complaints were caused by work conditions and that he had an occupational disease. The resulting 1982 order was not appealed.

Claimant's back pains increased, prompting him to file two aggravation claims, which were denied. The parties executed a disputed claim settlement on March 16, 1984:

"The parties DO HEREBY STIPULATE AND AGREE that their [sic ] exists between them a bona fide dispute as to the compensability of the osteoarthritis and they do hereby desire to settle their differences and do hereby agree that SAIF will pay unto the claimant the sum of $7,720 in full and final settlement of claimant's request for hearing concerning the partial denial of October 12, 1983, * * * and that SAIF will have no further responsibility for any medical treatment or compensation resulting from osteoarthritis to the claimant's back; and

"IT IS FURTHER HEREBY STIPULATED AND AGREED that the claimant shall hold SAIF harmless for any responsibility for any past medical treatment for claimant's osteoarthritis and further agreed that claimant will be responsible for the cost of said medical treatment for the osteoarthritic condition, both in the past and in the future."

In April, 1984, claimant filed another aggravation claim. SAIF rejected it, because it concluded that the 1984 agreement settled all claims arising from claimant's osteoarthritic condition. ¹ Claimant did not contest the validity of the agreement, but contended that the condition for which he received compensation in 1982 had worsened. The referee, on his own, raised the issue of the validity of the agreement and then ruled that the agreement was invalid under ORS 656.236 and that the condition had worsened. On appeal, the Board reversed the referee on two bases: first, the agreement was a valid disputed claim settlement which precluded claims based on the osteoarthritic condition; and, second, claimant had failed to prove any worsening of a compensable injury.

Claimant first contends that the Board's reinstatement of the 1984 agreement and SAIF's reliance on it to deny his claim was error. ORS 656.236(1) provides:

"No release by a worker or beneficiary of any rights under ORS 656.001 to 656.794 is valid."

That provision is intended to protect injured workers and the public at large. Schulz v. Compensation Department, 252 Or. 211, 216-17, 448 P.2d 551 (1968). However, ORS 656.289(4) allows settlement of claims:

"Notwithstanding ORS 656.236, in any case where there is a bona fide dispute over compensability of a claim, the parties may, with the approval of a referee, the board or the court, by agreement make such disposition of the claim as is considered reasonable." (Emphasis supplied.)

See Greenwade v. SAIF, 41 Or.App. 697, 701, 598 P.2d 1265, rev. den. 288 Or. 173 (1979).

Claimant suggests that there was no bona fide dispute as to the compensability of his osteoarthritis, because that condition was determined to be compensable in the 1982 order which was not appealed. Consequently, he contends that the settlement was invalid. SAIF argues that the 1982 order and 1984 agreement cover different issues regarding petitioner's osteoarthritic condition. The order, it argues, concerns only job related acceleration of the arthritic condition, while the agreement covers preexisting osteoarthritis and any natural progression. After reviewing the 1982 order and agreement, we conclude that, under the circumstances in 1984, a bona fide dispute as to SAIF's responsibility for claimant's osteoarthritic condition existed.

The legislature has specifically authorized certain types of settlements under ORS 656.289(4). Settlements are to be encouraged within the limits of the statute and should be set...