Krauzer v. Farmland Industries, Inc.

• Decision Date: 24 April 1981
• Docket Number: No. 52100,52100
• Parties: Joe KRAUZER, Claimant-Appellee, v. FARMLAND INDUSTRIES, INC., Respondent-Appellant, and Employers Insurance of Wausau, Insurance Carrier-Appellant, and Workers' Compensation Fund, Appellee.
• Court: Kansas Court of Appeals

Page 1223

626 P.2d 1223

6 Kan.App.2d 107

Joe KRAUZER, Claimant-Appellee, v. FARMLAND INDUSTRIES, INC., Respondent-Appellant, and Employers Insurance of Wausau, Insurance Carrier-Appellant,

and

Workers' Compensation Fund, Appellee.

No. 52100.

Court of Appeals of Kansas.

April 24, 1981.

Review Denied June 12, 1981.

Syllabus by the Court

1. The appellate scope of review in a workmen's compensation case iterated and applied.

2. In a workmen's compensation case a negative finding by a trial court that the party upon whom the burden of proof is cast did not sustain the requisite burden will not be disturbed on appeal absent an arbitrary disregard of undisputed evidence.

3. Liberal construction of the workmen's compensation statutes is not afforded an employer against the workmen's compensation fund except in those instances where a liberal construction would advance the legislative aim of encouraging the employment of handicapped persons.

4. Where language of a statute is plain and unambiguous and conveys a definite meaning, the court has no right to impose a different meaning, and the plain and obvious expressions of legislative intent are controlling.

5. An employee who misrepresents the condition of his health to his employer solely by reason of accident or mistake without any awareness that he has done so cannot be said to have knowingly made the misrepresentation contemplated by K.S.A.1980 Supp. 44-567(b ).

Stephen J. Jones, Wichita, for appellants.

Timothy P. O'Sullivan, Hutchinson, for appellee Workers' Compensation Fund.

Before HOLMES, Justice Presiding, MEYER, J., and HARRY G. MILLER, District Judge Retired, Assigned.

HOLMES, Justice:

Farmland Industries, Inc. and its workmen's compensation insurance carrier, Employers Insurance of Wausau, appealed an award of compensation wherein the district court adopted the findings of the examiner and assessed full liability against the appellants and reversed the director's award which had assessed the workmen's compensation fund (the Fund) with a proportionate share of the liability. The original claimant, Joe Krauzer, is not a party to this appeal and the only dispute is between the appellants and the Fund as to who is responsible for payment of Krauzer's award.

The issue to be determined by this court is whether the district court was correct when it determined that Krauzer did not knowingly misrepresent his physical condition to Farmland when he sought employment and reemployment with that company.

The facts are not in dispute and will not be set forth at length. Krauzer, an air force veteran, was employed by Farmland in August, 1974. On July 1, 1977, he fell and injured his back while at work. The parties agree the resulting disability was compensable under the workmen's compensation act and the amount of the award is not in contention. Krauzer had a long history of arthritis which was substantiated by records from the air force and the Hutchinson Clinic. His air force records revealed an arthritic condition of the lower back which had existed for over ten years prior to May, 1966. The records indicated recurrent episodes of low back pain due to arthritic and degenerative changes in the area of the lumber spine. Mr. Krauzer was discharged from the armed forces in 1966 and records from the Hutchinson Clinic reveal that he had been treated there for low back pain as early as June, 1971.

At the time of his initial employment by Farmland, Mr. Krauzer was required to fill out a medical history form and undergo a physical examination. The form completed by Mr. Krauzer asked whether he had ever had forty-four different ailments or conditions, including arthritis or a back injury. Mr. Krauzer answered the questions as to arthritis and a back injury in the negative. Mr. Krauzer was examined at the same time for Farmland by the Hutchinson Clinic and the doctor's report indicated no history of back or spine problems and stated Mr. Krauzer had no disqualifying medical conditions and he was fully approved for employment. During his period of employment, Mr. Krauzer was temporarily laid off on two occasions. Upon his return to employment in September, 1975, and May, 1976, he again was required to complete the same medical history forms and undergo a physical examination, the forms were completed in the same manner as before and the physical examination results were the same. The personnel officer of Farmland testified that if Farmland had known of Mr. Krauzer's arthritic condition, he would not have been hired in the first place.

K.S.A.1977 Supp. 44-567, in effect at the time of Mr. Krauzer's injury provided, in pertinent part:

"(b ) Knowledge of the workman's preexisting impairment or handicap at the time the employer employs or retains the workman in his or her employment shall be presumed conclusively if the workman, in connection with an application for employment or an employment medical examination or otherwise in connection with obtaining or retaining employment with the employer, knowingly: (1) Misrepresents himself or herself as not having such an impairment or handicap; ... (5) misrepresents himself or herself as not having any mental, emotional or physical impairment, disability, condition, disease or infirmity; ...."

The question before the court is simply did Mr. Krauzer knowingly misrepresent his physical condition to Farmland? If so, the Fund is liable for a proportionate share of his disability award and if not, the appellants are liable for payment of the entire award.

The examiner found that the claimant did not knowingly misrepresent his condition and stated in his decision:

"The Examiner has looked at the employment applications filled out by the claimant as furnished as part of the deposition of Mr. Driver. It is true that in each instance claimant did not mark the box or boxes to show that he had arthritis or back injury. Claimant, to the best of the Examiner's knowledge, has never had a previous back injury as such, suffering only from arthritis in the back. Claimant filled out two or three of these applications and never marked arthritis as something that he had. Throughout claimant's testimony it was apparent that when the attorneys would ask him about back pain he would say that he had not had it, but would state that he had arthritis. Claimant testified that he answered the questions as honestly as he could when he filled out the pre-employment applications. When asked about the problems he had had the last four years he was in the Air Force and the fact that he'd worn a belt to aid him with his arthritic back, the claimant admitted that that was true but apparently did not relate that to a physical handicap or disability. Respondent had the claimant examined by a physician on more than one occasion in connection with his employment, and the physician did not discern any arthritic condition or physical handicap that the claimant had, and in fact, passed him for employment with the respondent. The Examiner does not feel that the testimony sustains the contention of the respondent that the claimant knowingly misrepresented himself when he was hired or after he was hired. Accordingly, no portion of any award should be set off against the Kansas Workmen's Compensation Fund." (Emphasis added.)

On review the director reversed the examiner and found knowing misrepresentation by the claimant and apportioned the award between appellants and the Fund. In his findings he stated:

"The claimant, Mr. Krauzer was asked, 'Did you tell them that you had prior back problems when you filled out your medical report?' He answered, 'I don't recall whether I did or not.' Claimant was asked whether he had any back problems while he was in the Army and he indicated, 'Just arthritis in my back is all.' He also testified he has a belt from the Army that was for the arthritis in his back. Claimant said he tried to honestly answer the questions when he filled out the application form and said that if there was a mistake, it would have been an honest mistake. Claimant was asked whether the respondent was aware of his arthritic pain at the time he was employed and he answered no. He was further asked, 'Do you remember any questions on the employment application regarding prior back problems?' He answered, 'No, sir, I don't. If there was, I overlooked it or something, you know.' Sherl Krauzer, the claimant's wife, was asked whether during the seven years that they had been married, had the claimant ever complained to her about arthritis or pains in the lower back. She noted, 'If he did heavy work, he did.' She further testified, 'Of course, that would cause him to have problems in his back, and it would gradually go away, or .' The witness further answered, 'With rest and pain pills, or aspirin, it would ease up, yes.' She further testified that the claimant would return to work after back problems and further noted that after the accident in July, 1977, the pain did not ease and the claimant was in terrific pain. On cross examination by the Fund attorney, Mrs. Krauzer indicated that the claimant would complain about his back following work and this had gone on for about a year prior to his injury.

"The examiner found that the testimony did not sustain the contention of the respondent that the claimant knowingly misrepresented himself when he was hired or after he was hired. The Director has some concern in regard to this finding. It would appear to the Director that the claimant was aware that he had some arthritis and back problems at the time he filled out the employment applications. Relying only on the claimant's testimony on this issue may not give a complete picture. A person who is seeking employment normally wants to put his best foot forward and may not want to be as candid about his prior medical problems (as) he might be otherwise. The Director feels that one must look at all the evidence in a case to determine whether it may be...